CITY OF PLEASANT HILL
CITY COUNCIL MEETING AGENDA
FEBRUARY 27, 2023
REGULAR MEETING – 7:00 PM
Per City Council resolution under AB 361, members of the City Council, City staff/consultants, and the public will be able to participate either in-person* at
City Hall, 100 Gregory Lane, Pleasant Hill, CA 94523
or remotely via Zoom.
*Due to social distancing requirements, limited seating is available in person; if capacity is reached, you may participate remotely via Zoom.*
Watch on YouTube at: www.pleasanthillca.org/councilmeeting To provide comments via teleconference, click on the meeting link and enter the meeting ID and Passcode:
Meeting link: www.zoom.us
Meeting ID: 856 0528 4263
Passcode: 699998
The meeting ID and Passcode will change each meeting. See more information on Public Participation Options below.
City Council Meeting Agenda Page 1 February 27, 2023
City Offices, 100 Gregory Lane, Pleasant Hill, CA 94523 Telephone (925) 671-5267
MAYOR TIMOTHY FLAHERTY COUNCILMEMBER SUE NOACK
VICE MAYOR MATTHEW RINN COUNCILMEMBER ALLEN VINSON
COUNCILMEMBER ZAC SHESS
Options for observing the meeting and participating in public comment are provided below.
Public Communication. The public is welcome to address the City Council on items on the Consent Calendar or other items not listed on the agenda but within the Council’s jurisdiction during the general Public Comment period. There is an opportunity for the public to comment on other agenda items at the time they are discussed.
Comments are generally limited to three minutes.
Public Participation Options
1)_ Watch the Meeting via Youtube Livestream at www.pleasanthillca.org/councilmeeting. 2) Submit Written Comments by 4 pm the Day of the Meeting to [email protected] (comments received by deadline will be provided to the City Council before the meeting). Please specify that the correspondence is for public comment at the Council meeting. 3) Make Public Comment During the Meeting
When the Mayor invites public comment (or public comments on specific agenda items), you may participate in one of the following three ways:
City Council Meeting Agenda Page 2 February 27, 2023
a. Via Zoom
Go to www.Zoom.us using your computer/smart device and enter the Meeting ID and Passcode provided near the top of this page. You are encouraged to turn on your camera/video with a blurred background during your public comment so the City Council and public can see you on screen. We ask that you state your name and city of residence for the record when you start your comments.
Please use the "Raise hand" feature in Zoom. You will be observing the meeting as an Attendee and will not be seen or heard until it is your turn to speak. You will be invited into the meeting as a Panelist and asked to speak when it is your turn.
Try to be in a room or space without a lot of background noise. Mute your microphone until it is your turn to speak.
Have a strong, reliable internet connection
b. Via Phone
Call (669) 900-6833 and enter the Meeting ID and Passcode. If connecting via telephone, press *9 to “raise your hand” to alert staff that you wish to speak. (Note that there may be multiple hearing items on the same agenda.)
Have a strong, reliable internet connection or cell phone signal. c. In Person
Members of the public may attend the meeting in person subject to the limited space available. You may speak on any matter within the City Council's jurisdiction. Please fill out a speaker's card, available at the entry to the Council Chambers, and turn it in to the City Clerk.
If, due to a disability, a reasonable accommodation is needed to participate in this meeting, please contact the ADA Coordinator 24 hours in advance of the meeting at (925) 671-5221 or via California Relay at 711.
Materials related to an item on this agenda submitted to the Council after distribution of the agenda packet are available to the public in the City’s Public Records Portal at https://cityarchive.pleasanthillca.org/WebLink/ (click on City Council Agenda Packets) or by contacting the City Clerk at [email protected] or 925-671-5221.
City Council Meeting Recordings and Broadcasts.
Recorded City Council meetings are broadcast on Comcast Channel 28, Wave Channel 1029, and AT&T UVerse Channel 99 on the Wednesday following the meeting. Video recordings are generally available within 48 hours of the meeting, and may be viewed on the City’s website at www.pleasanthillca.org/MeetingVideos and selecting “City Council” from the meeting groups.
Agendas are Available for Review on the City Hall official noticing bulletin board (100 Gregory Lane), at the Pleasant Hill Police Department (330 Civic Drive), the Pleasant Hill Senior Center (233 Gregory Lane), and on the City’s website at www.pleasanthillca.org/agendas. Agenda packets will be available to the public on the City’s website at the same time as they are made available to the City Council.
City Council Meeting Agenda Page 3 February 27, 2023
1. CALL TO ORDER
2. PLEDGE OF ALLEGIANCE
3. ROLL CALL
4. CLOSED SESSION REPORT
5. CITY MANAGER COMMENTS:
(Brief updates on pending City business without discussion by the City Council.)
6. COUNCIL ANNOUNCEMENTS AND REPORTS
6.1 Reports from Councilmembers on Meetings or Conferences Attended at City Expense
6.2 Announcements from Councilmembers
7. PUBLIC COMMENT:
The public is welcome at this time to address the City Council on items on the Consent Calendar or other items not listed on the agenda but within the Council’s jurisdiction. There is an opportunity for the public to comment on other agenda items at the time they are discussed.
Comments are limited to three minutes per speaker. To provide public comments, please see the Public Participation Options above.
8. CONSENT CALENDAR: All matters listed under “Consent Calendar” are considered by the Council to be routine and will be enacted by one motion. There will be no separate Council discussion of these items unless requested by a Councilmember prior to the time Council votes on the motion to adopt.
8.1 Approve Minutes for the Regular City Council Meeting of February 6, 2023 and the Special City Council Meeting of February 16, 2023
8.2 Adopt Resolution No. ___-23 Approving and Adopting Designated Alternates to Serve as Standby Officers to Allow the City Council to Reconstitute Itself in the Event of EmergencyCaused Vacancies and Rescinding Resolution No. 3-21
9. ACTION CALENDAR
9.1 Accept the Audited Annual Comprehensive Financial Report for the Fiscal Year Ended June 30, 2022
9.2 Measure K Update and Consideration of Capital Improvement Project Appropriations (Items 9.3,
9.4, 9.5)
9.3 Adopt Resolution No. ___-23 Approving the Appropriation of Measure K Funds to Fund the Resurfacing of Residential Zone 17 as Part of the 2022 Street Resurfacing Project No. PSC-01- 22 and Authorizing the Maintenance Superintendent to Execute a Change Order With MCK Services, Inc.
9.4 Adopt Resolution No. ___-23 Approving Measure K Reserve & Appropriating Additional Capital Improvement Projects
City Council Meeting Agenda Page 4 February 27, 2023
9.5 Adopt Resolution No. ___-23 Authorizing an Appropriation of General Fund and Measure K Funds for Janitorial Services at City Facilities and Authorize the City Manager to Execute a Contract with Frank and Grossman Landscape Contractor's Inc.
9.6 Adopt Resolution No. ___-23 Authorizing the City Manager to Execute a Design Services Agreement with Ruggeri-Jensen-Azar for Engineering Design Services for the Oak Park Boulevard Sidewalk Gap Closure Project
Item is continued to March 6, 2023
9.7 Adopt Resolution No. __-23 Opposing Initiative No. 21-0042A1, the Taxpayer Protection and Government Accountability Act, and Direct Staff to Send a Letter of Opposition to the League of California Cities Director of Public Affairs
9.8 Adopt Resolution No. ___-23 Proclaiming the End of the Local State of Emergency in the City of Pleasant Hill Due to the COVID-19 Pandemic
10. ADJOURNMENT
Next City Council Meeting: March 6, 2023
CITY COUNCIL STAFF REPORT
Meeting Date: February 27, 2023
TO: THE HONORABLE MAYOR AND CITY COUNCILMEMBERS
SUBJECT: APPROVE MINUTES FOR THE REGULAR CITY COUNCIL MEETING OF FEBRUARY 6, 2023 AND THE SPECIAL CITY COUNCIL MEETING OF FEBRUARY 16, 2023
RECOMMENDED CITY COUNCIL ACTION
Approve the minutes.
ATTACHMENT(S):
February 6, 2023 – Tentative Minutes
February 16, 2023 – Tentative Minutes
Prepared by: Carol Wu, City Clerk Recorder
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MINUTES OF THE
REGULAR MEETING – CITY COUNCIL
February 6, 2023
City Council Meeting Minutes Page 1 February 6, 2023
Mayor Flaherty called a Regular Meeting of the City Council to order at 7:00 PM, complete proceedings of which were electronically recorded. The meeting was a hybrid of both in person and teleconferenced attendees. The meeting agenda was posted on the City Hall outdoor bulletin board at 100 Gregory Lane, Pleasant Hill, CA on February 2, 2023, by Deputy City Clerk Juanita Davalos.
1. CALL TO ORDER
2. PLEDGE OF ALLEGIANCE
3. ROLL CALL
Attendee Name Title Status
Timothy M. Flaherty Mayor Present
Matthew Rinn Vice Mayor Present
Sue Noack Councilmember Present
Zac Shess Councilmember Present
4. PRESENTATIONS
4.1 Proclamation Designating the Month of February as Black History Month Mayor Flaherty presented a proclamation to Lloyd Schine, Civic Action Commission Diversity Subcommittee Chair, declaring the month of February as Black History Month.
5. CITY MANAGER COMMENTS
June Catalano, City Manager, reported that the Off the Grid food trucks will return to Pleasant Hill starting the third Wednesday in April.
6. COUNCIL ANNOUNCEMENTS AND REPORTS
6.1 Reports from Councilmembers on Meetings or Conferences Attended at City Expense
(A) Contra Costa Mayors Conference Hosted by the City of Walnut Creek on February 2, 2023
All Councilmembers reported that they attended the Contra Costa Mayors Conference held on February 2, 2023. Councilmember Noack provided a brief report on the topics discussed at the conference.
(B) Other Meetings Attended at City Expense
None
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Attachment: February 6, 2023 Tentative Minutes (Minutes) City Council Meeting Minutes Page 2 February 6, 2023
6.2 Announcements from Councilmembers
Councilmember Shess reported his attendance at the City staff luncheon and at the College Park High School Boosters Club Crab Feed.
Vice Mayor Rinn reported that he attended the same events as Councilmember Shess.
Councilmember Noack and Mayor Flaherty reported their attendance at the College Park High School Boosters Club Crab Feed.
7. PUBLIC COMMENT
Mayor Flaherty opened public comment.
The following members of the public appeared in person to provide a comment:
Beverly Posner
Khuloud Jamil
Naeemeh Sartip
Benu Chhabra
The following member of the public participated via teleconference to provide a comment:
Ady Olvera, Concord Communities Alliance
Mayor Flaherty closed public comment.
8. CONSENT CALENDAR
Motion (Noack/Rinn) to Approve all consent items, carried as follows:
AYES: Noack, Rinn, Shess, Flaherty
8.1 Approve Minutes for the Regular City Council Meeting of January 23, 2023 and the Special City Council Meeting of January 30, 2023
8.2 Approve Checks Dated: January 20, 2023; January 27, 2023
8.3 Accept Update on Contra Costa Transportation Authority and TRANSPAC
8.4 Reaffirm Resolution No. 33-22 Approving Continued Teleconferenced, Hybrid or In-Person Meetings of All City Legislative Bodies Pursuant to the Provisions of AB 361
8.5 Adopt Resolution No. 5-23 Directing the Preparation and Filing of the 2023/2024 Annual Report for Assessment District No. 20 (Commercial Area Landscape and
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Attachment: February 6, 2023 Tentative Minutes (Minutes) City Council Meeting Minutes Page 3 February 6, 2023
Lighting) and Adopt Resolution No. 6-23 Requesting Consent from the City of Concord for Ordering of Improvements and Assessments of Costs for Benefited Property in Assessment District No. 20
8.6 Adopt Resolution No. 7-23 Directing the Preparation and Filing of the FY 2023/2024 Annual Report for Assessment District No. 22
8.7 Adopt Resolution No. 8-23 Approving Continued Participation in the Stormwater Pollution Management Utility District and Authorizing the Contra Costa County Flood Control and Water Conservation District to Adopt the Fiscal Year 2023/24 Stormwater Utility Area Fee for the City of Pleasant Hill
9. ACTION CALENDAR
9.2. Adopt Resolution No. 9-23 Accepting the Gregory Gardens Storm Drain Rehabilitation Project No. 03-21 as Complete and Authorizing the Maintenance Superintendent to Issue and Record a Notice of Completion Item Taken Out of Order
Ann James, Maintenance Superintendent, delivered a presentation on the Gregory Gardens Storm Drain Rehabilitation. Ms. James reported that the project has been completed.
No one from the public spoke on the item.
Motion (Noack/Rinn) to Approve item 9.2, carried as follows:
AYES: Noack, Rinn, Shess, Flaherty
9.1 Determine the Interview Pool, Questions, Format, and Date to Fill the City Council Vacancy
The following members of the public appeared in person to provide a comment:
Chris Puglisi, Northern California Carpenters Union
Robert Kattenburg, Pleasant Hill
The following members of the public participated via teleconference to provide a comment:
Jason Lindsey
Ken Miller
Ady Olvera
Councilmembers selected the following applicants to be interviewed for the vacant City Council position:
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Attachment: February 6, 2023 Tentative Minutes (Minutes) City Council Meeting Minutes Page 4 February 6, 2023
Allen Vinson
Eslam Najjar
Chris Tipton
Zhanna Thompson
Councilmembers reviewed and discussed the draft interview questions, and determined the format of conducting the interviews and the final selection process.
The City Council recommended that the interviews be conducted at a Special City Council meeting held on Thursday, February 16, 2023 at 7:00 p.m.
10. ADJOURNMENT
Mayor Flaherty adjourned the meeting at 8:14 p.m. The next Special City Council meeting will be held on Thursday, February 16, 2023, beginning at 7:00 p.m.
CAROL W. WU, CITY CLERK RECORDER
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Attachment: February 6, 2023 Tentative Minutes (Minutes)
MINUTES OF THE
SPECIAL MEETING – CITY COUNCIL
February 16, 2023
City Council Meeting Minutes Page 1 February 16, 2023
Mayor Flaherty called a Special Meeting of the City Council to order at 7:02 PM, complete proceedings of which were electronically recorded. The meeting was a hybrid of both in person and teleconferenced attendees. The meeting agenda was posted on the City Hall outdoor bulletin board at 100 Gregory Lane, Pleasant Hill, CA on February 10, 2023, by Deputy City Clerk Juanita Davalos.
1. CALL TO ORDER
2. PLEDGE OF ALLEGIANCE
3. ROLL CALL
Attendee Name Title Status
Timothy M. Flaherty Mayor Present
Matthew Rinn Vice Mayor Present
Sue Noack Councilmember Present
Zac Shess Councilmember Present
4. ACTION CALENDAR
4.1 Interview Applicants and Adopt Resolution No. 10-23 to Fill the City Council Vacancy
Mayor Flaherty explained the format of the interview process.
Mayor Flaherty announced that Eslam Najjar withdrew from the interview pool.
The following members of the public provided a written comment:
Jack Prosek
Kevin Van Buskirk
The following members of the public appeared in person to provide a comment:
Jim Bonato
Tom Hansen
Sandra Bonato
Ken Burns
Robert Kattenburg
Valerie Sloven
Chris Puglisi
The following members of the public participated via teleconference to make a comment:
Karen Yapp
Rebecca Auerbach
Dick Offerman
8.1.b
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Attachment: February 16, 2023 Tentative Minutes (Minutes) City Council Meeting Minutes Page 2 February 16, 2023
Ady Olvera
Ena Silva
Councilmembers interviewed applicants Allen Vinson, Chris Tipton, and Zhanna Thompson.
Councilmembers voted unanimously in favor of Allen Vinson to fill the City Council vacancy.
Motion (Flaherty/Noack) to Approve item 4.1, carried as follows:
AYES: Noack, Rinn, Shess, Flaherty
Danielle Navarro, City Clerk, administered the Oath of Office to Councilmember Allen Vinson.
5. ADJOURNMENT
Mayor Flaherty adjourned the meeting at 9:23 p.m. The next Regular City Council meeting will be held on Monday, February 27, 2023, beginning at 7:00 p.m.
CAROL W. WU, CITY CLERK RECORDER
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Attachment: February 16, 2023 Tentative Minutes (Minutes)
CITY COUNCIL STAFF REPORT
Meeting Date: February 27, 2023
TO: THE HONORABLE MAYOR AND CITY COUNCILMEMBERS
SUBJECT: ADOPT RESOLUTION NO. ___-23 APPROVING AND ADOPTING
DESIGNATED ALTERNATES TO SERVE AS STANDBY OFFICERS TO
ALLOW THE CITY COUNCIL TO RECONSTITUTE ITSELF IN THE
EVENT OF EMERGENCY-CAUSED VACANCIES AND RESCINDING
RESOLUTION NO. 3-21
SYNOPSIS
The City Council has historically adopted a resolution to designate alternates to serve as standby officers, which would allow the City Council to reconstitute itself in the event of emergencycaused vacancies and provide continuity of government. The current resolution needs to be updated by approving the designated alternates to serve as standby officers to allow the City Council to reconstitute itself in the event of emergency-caused vacancies and rescinding Resolution No. 3-21.
DISCUSSION
Background
The California Emergency Services Act provides for the preservation of local government in the event of a state of war emergency, state of emergency or a local emergency by allowing the City Council to appoint a succession of standby officers in order to preserve law and order and, so far as possible, continue or restore government services.
Analysis
Pursuant to Government Code § 8638, the City Council has the power to appoint three standby officers for each City Councilmember and the City Manager. The attached proposed resolution includes the names of standby officers that have been selected by each City Councilmember and the City Manager. Each designated standby officer is required to take an oath of office to be scheduled after adoption of the resolution by the City Council and before performing the duties of the office.
8.2 Packet Pg. 12
FISCAL IMPACT
There is no fiscal impact to the City.
PUBLIC CONTACT
Public contact was made through posting of the City Council agenda on the City’s official notice bulletin board, at the Pleasant Hill Senior Center, and the Pleasant Hill Police Department. The agenda and staff report are posted on the City’s web page.
RECOMMENDED CITY COUNCIL ACTION
Staff recommends that the City Council adopt the proposed resolution approving designated alternates to serve as standby officers to allow the City Council to reconstitute itself in the event of emergency-caused vacancies and rescinding Resolution No. 3-21.
ALTERNATIVES TO RECOMMENDED ACTION
None recommended
ATTACHMENT(S):
Proposed Resolution
Resolution No. 3-21
Prepared by: Danielle K. Navarro, Principal Management Analyst/City Clerk Approved by: June Catalano, City Manager
8.2 Packet Pg. 13
RESOLUTION NO. __-23
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PLEASANT HILL
APPROVING AND ADOPTING DESIGNATED ALTERNATES TO SERVE AS STANDBY
OFFICERS TO ALLOW THE CITY COUNCIL TO RECONSTITUTE ITSELF IN THE
EVENT OF EMERGENCY-CAUSED VACANCIES AND RESCINDING
RESOLUTION NO. 3-21
WHEREAS, disasters/emergencies may strike at any time, without warning, requiring immediate governmental actions; and
WHEREAS, vacancies could occur in city government affecting its ability to carry out its duties during such emergencies; and
WHEREAS, Article 15 of the California Emergency Services Act (the “Act”) (Govt. Code §§ 8635-8644) provides for the preservation of local government in the event of enemy attack, state of emergency or local emergency; and
WHEREAS, the Act allows the governing body of a political subdivision to appoint up to three standby officers for each member of the governing body and the City Manager; and WHEREAS, those standby officers shall be designated numbers 1, 2, and 3 in descending order of succession.
NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Pleasant Hill as follows:
1. The following standby officers are designated and appointed to serve in their posts as standby officers at the pleasure of the City Council for the term of the elected officials:
COUNCILMEMBER STANDBY OFFICER
Councilmember Flaherty 1. William Bankert
2. Chris Tipton
3. Gretchen del a O
Councilmember Noack 1. David Durant
2. Jennifer Ortega
3. John Hanecak
Councilmember Rinn 1. Jody Lawson
2. Heather Rosmarin
3. Chris Osterholt
Councilmember Shess 1. Connor Day
2. Bobby Glover
3. Debbie Shess
8.2.a
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Attachment: Proposed Resolution (Designating Standby Officers 2023) Councilmember Allen Vinson 1. Sandy Vinson
2. Chris Tipton
3. Jim Bonato
City Manager Catalano 1. Chief of Police
2. Community Development
Director/Assistant City Manager
3. Maintenance Superintendent
2. Resolution No. 3-21 is hereby rescinded.
3. The City Clerk is directed to administer the oath of office to the standby officers.
ADOPTED by the City Council of the City of Pleasant Hill at a regular meeting held on the 27th day of February, 2023, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
___________________________________
TIMOTHY M. FLAHERTY, Mayor
ATTEST:
DANIELLE K. NAVARRO, City Clerk
8.2.a
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Attachment: Proposed Resolution (Designating Standby Officers 2023)
8.2.b
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Attachment: Resolution 3-21 (Designating Standby Officers 2023)
8.2.b
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Attachment: Resolution 3-21 (Designating Standby Officers 2023)
CITY COUNCIL STAFF REPORT
Meeting Date: February 27, 2023
TO: THE HONORABLE MAYOR AND CITY COUNCILMEMBERS
SUBJECT: ACCEPT THE AUDITED ANNUAL COMPREHENSIVE FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2022
SYNOPSIS
The Budget Committee reviewed the Annual Comprehensive Financial Report and the Management Letter as of June 30, 2022 on February 22, 2023 and recommends acceptance by the City Council.
DISCUSSION
Background
The City’s fiscal year operates from July 1 through June 30. The Annual Comprehensive Financial Report (ACFR) summarizes the City’s financial activities and fund balances as of June 30, 2022.
Analysis
The Annual Comprehensive Annual Financial Report (ACFR) summarizes the City’s financial activities for fiscal year (FY) 2021/22 and fund balances as of June 30, 2022. The ACFR was prepared in accordance with generally accepted accounting principles (GAAP) as promulgated by the Governmental Accounting Standards Board (GASB). The financial statements contained within the ACFR were audited by Macias, Gini & O’Connell LLP (MGO), the City’s independent Certified Public Accountant, which issued an unmodified opinion - the highest possible rating.
The ACFR for FY 2021/22 is attached for Council review and consideration for acceptance. The transmittal letter, independent auditor’s report, and management’s discussion and analysis section provide a summary of the City’s financial activities during the year.
MGO also prepares the Management Letter to the City Council. This report provides the auditors an opportunity to determine any audit issues and/or areas needing improvement. In summary, the auditors had no material audit issues, findings, or disagreements with the City.
9.1 Packet Pg. 18
FISCAL IMPACT
None
PUBLIC CONTACT
Public contact was made through posting of the City Council agenda on the City’s official notice bulletin board, at the Pleasant Hill Senior Center, and at the Pleasant Hill Police Department.
The agenda and staff report are posted on the City’s web page.
RECOMMENDED CITY COUNCIL ACTION
Accept the City of Pleasant Hill’s Annual Comprehensive Financial Report and Management Letter for the fiscal year ended June 30, 2022, as recommended by the Budget Committee.
ALTERNATIVES TO RECOMMENDED ACTION
Do not accept the City of Pleasant Hill’s Annual Comprehensive Financial Report and Management Letter for the fiscal year ended June 30, 2022.
ATTACHMENT(S):
1. City of Pleasant Hill Annual Comprehensive Financial Report (ACFR) At Fiscal Year-End June 30, 2022
2. Management Letter to the City of Pleasant Hill for June 30, 2022 Prepared by: Erick Cheung, Finance Manager
Approved by: June Catalano, City Manager
9.1 Packet Pg. 19
9.1.a
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
9.1.a
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
ANNUAL COMPREHENSIVE FINANCIAL REPORT
YEAR ENDED JUNE 30, 2022
Prepared by
FINANCE DIVISION
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Annual Comprehensive Financial Report
Year Ended June 30, 2022
Table of Contents
Page
INTRODUCTORY SECTION
Letter of Transmittal ............................................................................................................................................. i List of Principal Officials .................................................................................................................................... iv California Map ..................................................................................................................................................... v Organization Chart .............................................................................................................................................. vi GFOA Certificate of Achievement for Excellence in Financial Reporting ..................................................... vii
FINANCIAL SECTION
Independent Auditor’s Report ......................................................................................................................... 1 Management’s Discussion and Analysis (Required Supplementary Information - Unaudited).............. 5 Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Position ................................................................................................................. 17 Statement of Activities ..................................................................................................................... 18 Fund Financial Statements:
Governmental Funds:
Balance Sheet ................................................................................................................................... 19 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position - Governmental Activities ................................................................. 20 Statement of Revenues, Expenditures and Changes in Fund Balances ............................................ 21 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities - Governmental Activities ............................................................................................................. 22 Statement of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual:
General Fund ............................................................................................................................... 23 Traffic Mitigation Fund ............................................................................................................... 24 Measure J Growth Management Fund ........................................................................................ 25 Gas Tax Fund .............................................................................................................................. 26 American Rescue Plan Act Fund ................................................................................................. 27 Proprietary Fund:
Statement of Fund Net Position ........................................................................................................ 28 Statement of Revenues, Expenses and Changes in Fund Net Position ............................................. 29 Statement of Cash Flows .................................................................................................................. 30 Fiduciary Funds:
Statement of Fiduciary Net Position ................................................................................................. 31 Statement of Changes in Fiduciary Net Position .............................................................................. 32 Notes to Basic Financial Statements ...................................................................................................... 33
9.1.a
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Annual Comprehensive Financial Report
Year Ended June 30, 2022
Table of Contents
Page
FINANCIAL SECTION (Continued)
Required Supplementary Information (Unaudited):
Schedule of City’s Proportionate Share of the Net Pension Liability ......................................................... 65 Schedule of City Contributions .................................................................................................................... 66 Other Supplementary Information:
Nonmajor Governmental Funds:
Combining Balance Sheet ................................................................................................................ 70 Combining Statement of Revenues, Expenditures and Changes in Fund Balances ......................... 74 Schedules of Revenues, Expenditures and Changes in Fund Balances – Budget and Actual .......... 78 Custodial Funds:
Combining Statement of Fiduciary Net Position .............................................................................. 88 Combining Statement of Changes in Fiduciary Net Position ........................................................... 89
STATISTICAL SECTION
Financial Trends:
Net Position by Component – Last Ten Fiscal Years .................................................................................. 92 Changes in Net Position – Last Ten Fiscal Years ........................................................................................ 93 Fund Balances of Governmental Funds – Last Ten Fiscal Years ............................................................... 95 Changes in Fund Balances of Governmental Funds – Last Ten Fiscal Years ............................................ 96 Revenue Capacity:
Assessed and Estimated Actual Net Value of Taxable Property – Last Ten Fiscal Years ......................... 97 Property Tax Rates – All Direct and Overlapping Governments – Last Ten Fiscal Years ........................ 98 Principal Property Taxpayers – Current Year and Ten Years Ago ............................................................. 99 Property Tax Levies and Collections – Last Ten Fiscal Years ................................................................. 100 Debt Capacity:
Ratio of Outstanding Debt by Type – Last Ten Fiscal Years ................................................................... 101 Computation of Direct and Overlapping Debt .......................................................................................... 102 Computation of Legal Bonded Debt Margin – Last Ten Fiscal Years ..................................................... 103 Demographic and Economic Information:
Demographic Statistics – Last Ten Calendar Years .................................................................................. 104 Top 25 Sales Tax Producers – Current Year and Nine Years Ago ........................................................... 105 Sales by Categories – Last Ten Calendar Years ........................................................................................ 106 Operating Information:
Full-Time Equivalent City Government Employees by Function – Last Ten Fiscal Years ..................... 107 Operating Indicators by Function/Program – Last Ten Fiscal Years ........................................................ 108 Capital Asset Statistics by Function/Program – Last Ten Fiscal Years .................................................... 109
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) i
February 7, 2023
To the City Council and Residents of Pleasant Hill
I am pleased to submit the City of Pleasant Hill’s (City) Annual Comprehensive Financial Report (ACFR) for the fiscal year ended June 30, 2022. The ACFR, which contains the City’s basic financial statements, auditor’s report, and important supplemental information, is intended to present the reader with a comprehensive view of the City’s financial position and activities.
The ACFR was prepared by the City’s Finance Division, which assumes responsibility for its accuracy, completeness, and fairness. The City’s financial statements were audited by Macias Gini & O’Connell LLP, the City’s independent certified public accountant, in order to provide reasonable assurance that the financial statements are free of material misstatement and are fairly presented in accounting principles generally accepted in the United States of America (GAAP).
Macias Gini & O’Connell LLP issued an unmodified opinion, the highest possible level of assurance, for the fiscal year ending June 30, 2022.
The Management’s Discussion and Analysis (MD&A) section of the ACFR provides an overview of the City’s fiscal position and activities. The MD&A complements this transmittal letter and should be read in conjunction with it.
City of Pleasant Hill Government
Pleasant Hill is a general law city incorporated in 1961. It delivers a range of municipal services under the council-manager form of government, and offers outstanding quality of life to its approximately 34,000 residents across 8.1 square miles.
City Council
The City Council consists of five members who are elected at large for staggered four-year terms.
The City Treasurer was an elected position, but beginning December 2024, the City Manager will appoint this public official. The Mayor and Vice-Mayor are elected by the Council from its own ranks and serve for one-year terms. The City Council appoints the City Manager and City Attorney.
The City Attorney is a contracted position.
Budget Committee
While retaining authority to approve all actions, the City Council has established a Budget Committee to review and oversee financial matters. Staff provides the Budget Committee and Council with reports such as the ACFR, Long-Term Financial Plan, and quarterly budget-versusactual results that are utilized in evaluating the City’s financial position.
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) ii
Economic Conditions and Budget Challenges
The local and regional condition of the economy have significant influence on the City’s financial position. The City continues to deal with the impacts of the COVID-19 pandemic, from supply chain issues to changing health recommendations, which continues to cause disruption to the economy.
Economic recovery from COVID-19 appeared to continue as California job growth and consumer purchasing power continued to grow. Inflation concerns are rising due to the supply change shortage from COVID-19 and then exacerbated by a foreign military incursion, which has impacts on the global economy. The United States Treasury has raised interest rates to address inflation, but this will have negative impacts to jobs and housing market, which could cause a recession.
These issues could affect the City’s economically sensitive revenues, such as Sales Tax and Transient Occupancy Tax (TOT). Sales tax revenue has been at historical highs over the last couple of years due to the demand for goods and automobiles, but higher prices due to inflation and rising interest rates could level off this growth. Recession concerns could continue to hinder TOT recovery as this source, which continues to be below pre-COVID levels, and had just begun to improve.
The federal government approved the American Rescue Plan Act (ARPA) in March 2021 for $350 billion. The United States Treasury provided $1.2 billion to the State of California for smaller cities, which was allocated based on population. The City received $8.3 million in ARPA funds to help the City recover from COVID-19. These funds must be obligated by December 31, 2024 and spent by December 31, 2026. The City Council has allocated approximately $2.5 million for business improvement; health considerations, from COVID-19 testing to extra cleaning of facilities and vehicles; and unfunded projects and programs during the current fiscal year.
The City has prudently maintained or reduced costs whenever possible, but personnel costs continue to be a significant share of the City’s total expenditures. The City’s required contribution toward its CalPERS unfunded liability will continue to increase rapidly over the next few years despite the City’s best efforts on cost containment. The City will continue to work with experts in this area to analyze the City’s options for reducing the lifecycle net cost and volatility of required contributions. The City implemented one of the recommendations made by an independent actuarial firm and deposited $1 million into a Pension Trust Fund during the fiscal year. The Pension Trust Fund is an investment tool to offset future pension costs and is under the direction of the City. Unlike many municipalities, the City does not provide post-retirement health care and therefore has no related liability costs nor contributions to record.
Addressing critical capital asset and infrastructure needs continues to be a top priority. The City’s Capital Improvement Plan (CIP) for FY 2022-2027 illustrates the City’s infrastructure needs and proposes a plan for making infrastructure investments. Pleasant Hill residents recognized the need for additional local funding for capital improvements, and supported the Measure K sales tax increase in November 2016. Measure K is projected to generate in excess of $5.0 million annually.
The funds can be used for important City services including repaving and maintaining neighborhood streets; maintaining and upgrading the City’s storm drains; adding new sidewalks and walking and bike paths; constructing a new community library; and funding other City projects and services that Pleasant Hill residents and the City Council have identified as key
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) iii
priorities. The City achieved one of the major objectives with the opening of the new City Library, which had a grand opening on July 30, 2022.
Biennial Budget
During FY 21/22, the City adopted the biennial budget for FY 22/23 – FY 23/24. The goal was to create a realistic plan that addresses major revenue and expenditure issues while reflecting the priorities of the City Council and community.
Awards
The Government Finance Officers Association of the United States and Canada (GFOA) awarded the City a Certificate of Achievement for Excellence in Financial Reporting for the fiscal year ending June 30, 2021. The City has received this award for the past 30 years. To receive the award, a jurisdiction must publish an easily readable and efficiently organized ACFR that satisfies GAAP and applicable legal requirements. Staff believes that the ACFR for the fiscal year ended June 30, 2022 again meets the Certificate of Achievement Program’s requirements and will submit it to the GFOA for consideration.
Acknowledgments
This ACFR is the result of the combined efforts of the City’s Finance Division, other City departments, and Macias Gini & O’Connell LLP. Acknowledgment should also be given to the City Council Budget Committee for its thoughtful, prudent guidance and direction on the financial affairs of the City.
Respectfully submitted,
June Catalano Erick Cheung
City Manager Finance Manager
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) iv
ELECTED OFFICIALS
Michael G. Harris, Mayor
Timothy M. Flaherty, Vice Mayor
Kenneth Carlson, Councilmember
Susan Noack, Councilmember
Matthew Rinn, Councilmember
Andrew Kalinowski, City Treasurer (Appointed)
CITY STAFF
June Catalano, City Manager
Janet Coleson, City Attorney
Bryan Hill, Chief of Police
Ethan Bindernagel, Community Development Director/Assistant City Manager Zach Seal, Economic Development Manager
Troy Fujimoto, City Planner
Geoff Gillette, Public Information Officer
Danielle Habr, Senior Management Analyst/Deputy City Clerk Ann James, Maintenance Superintendent
Ling King, Chief Technology Officer
Erick Cheung, Finance Manager
Ericka Mitchell, Human Resources Manager
Ananthan Kanagasundaram, City Engineer
Geoffrey Simmons, Chief Building Official
Carol Wu, City Clerk
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
v
California Map
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CITY OF PLEASANT HILL
Organization Chart
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) www.mgocpa.com
Macias Gini & O’Connell LLP
2121 N. California Boulevard, Suite 750
Walnut Creek, CA 94596 1
Independent Auditor’s Report
Honorable Mayor and Members
of the City Council
City of Pleasant Hill, California
Report on the Audit of the Financial Statements
Opinions
We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Pleasant Hill, California (City), as of and for the year ended June 30, 2022, 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 accompanying financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City as of June 30, 2022, 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 (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Responsibilities of Management for the Financial Statements The City’s 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 GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) 2 In performing an audit in accordance with GAAS 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, the schedule of City’s proportionate share of the net pension liability, and the schedule of City contributions, as listed in 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 GAAS, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The combining and individual fund financial statements and schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with GAAS. In our opinion, the individual and combining fund financial statements and schedules are fairly stated, in all material respects, in relation to the basic financial statements as a whole.
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) 3 Other Information
Management is responsible for the other information included in the annual comprehensive financial report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditor’s report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.
In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated February 7, 2023, 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 report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.
Walnut Creek, California
February 7, 2023
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2022
5 The Management’s Discussion and Analysis (MD&A) section of the Annual Comprehensive Financial Report (ACFR) provides City management’s summary of the financial statements and assessment of the City’s financial condition.
Financial Highlights
The City’s total net position (assets and deferred outflows of resources less liabilities and deferred inflows of resources) was $64.9 million as of June 30, 2022, compared to $62.8 million as of June 30, 2021. The City’s General Fund reported an ending fund balance of $22.1 million, approximately $16.5 million of which was assigned, $4.2 million of which was restricted, and $1.4 million was unassigned. The City’s General Fund ending fund balance decreased $11.0 million, mainly due to the expected capital outlay costs of $13.4 million for the construction of the nearly completed library.
Overview of the Annual Comprehensive Financial Report
This Annual Comprehensive Financial Report is organized into five sections:
An Introduction, which includes the Transmittal Letter; Management’s Discussion and Analysis;
Basic Financial Statements and Notes;
Supplemental information; and
Statistical information.
Basic Financial Statements
The Basic Financial Statements summarize the City’s activities and financial position. They contain the Government-Wide Financial Statements, Fund Financial Statements, and Notes to these financial statements.
Government-Wide Financial Statements
The Government-Wide Financial Statements provide an overview of the City’s complete financial activities. They include the Statement of Net Position and the Statement of Activities.
The Statement of Net Position reports the City’s capital assets and long-term liabilities on a full accrual basis of accounting similar to that used by private-sector businesses in their balance sheets. Over time, changes in net position may serve as an indication of whether the City’s financial position is improving or deteriorating.
The Statement of Activities provides information about the City’s revenues and expenses on a full accrual basis, similar to that used by private-sector businesses in their income statements, with an emphasis on measuring net revenues or expenses for each of the City’s functions. The Statement of Activities explains in detail the change in net position for the year.
The amounts in the Statement of Net Position and the Statement of Activities are separated into Governmental and Business-Type Activities, as follows:
Governmental Activities - Governmental activities include all of the City’s basic services: general government, public safety, transportation, and community development. These services are supported by the City’s general revenues, such as taxes, and by specific program revenues, such as fees. Business-Type Activities - The City’s only enterprise activity, Diablo Vista Water, is reported as a business-type activity. The activity is supported by fees and assessments paid by the users.
The Government-Wide Financial Statements can be found on pages 17-18 of this report.
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CITY OF PLEASANT HILL
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2022
6 Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that are intended for specific activities or objectives. A fund is an independent accounting entity with a self-balancing set of accounts.
The City uses fund accounting to ensure compliance with finance-related legal requirements. The Fund Financial Statements provide detailed information about each of the City’s most significant funds, called major funds. All non-major funds are combined into a single column on each fund statement. The General Fund is always considered a major fund. The other funds that the City considers major funds may change from year to year based on City activities.
The Fund Financial Statements display the City’s operations in more detail than the Government-Wide Financial Statements. There are three main types of funds in governmental accounting: governmental funds, proprietary funds, and fiduciary funds, defined below.
Governmental funds: These are the funds that support most governmental functions. The fund types in this category include general, special revenue, debt service, and capital project funds. Proprietary funds: These funds are used to account for a government’s ongoing activities that are similar to those found in the private sector. This fund type includes Diablo Vista Water. Fiduciary funds: These funds are used to account for assets held by a governmental unit in a trustee capacity or as a custodian for individuals, private organizations, or other government agencies.
Governmental Funds
Governmental Fund Financial Statements are prepared on the modified accrual basis of accounting, which means they measure only current financial resources and uses. Long-lived assets, such as capital assets, and long-term liabilities, such as pension and compensated absences, are only presented in the Government-Wide Financial Statements.
Because the focus of governmental funds is narrower than that of Government-Wide Financial Statements, it is useful to compare the two. Reconciliation between the Governmental Fund Balance Sheet and the Governmental Fund Statement of Revenues, Expenditures and Changes in Fund Balances facilitates this analysis.
The City normally adopts a biennial budget on or before June 30 of even-numbered years for each of the ensuing two fiscal years. The Budgetary Comparison Statements are provided to demonstrate performance against budget.
The Governmental Fund Financial Statements and Budgetary Comparison Statements can be found on pages 19- 27 of this report.
Proprietary Funds
Proprietary Funds are prepared on the full accrual basis of accounting. These statements include all of their assets and liabilities, both current and long-term.
The Proprietary Fund Financial Statements can be found on pages 28-30 of this report.
Fiduciary Funds
Fiduciary Funds are used to account for resources held for the benefit of parties outside of the City. They are not reported in the Government-Wide Financial Statements because the resources of those funds are not available to support the City’s own programs.
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2022
7 The City has two different types of fiduciary funds: a Private-Purpose Trust Fund is used to report trusts or similar arrangements that benefit other entities, and a Custodial Fund is used to report resources held in a custodial capacity for other public entities.
The Fiduciary Fund Financial Statements can be found on pages 31-32 of this report.
Notes to the Financial Statements
The Notes to the financial statements provide additional information that is necessary to acquire a full understanding of the data provided in the Government-Wide and Fund Financial Statements. The Notes to the financial statements can be found on pages 33-63 of this report.
Required Supplementary Information (RSI)
RSI is presented in addition to the basic financial statements and accompanying notes. This required information includes the schedule of City’s proportionate share of the net pension liability and the schedule of City contributions. The RSI can be found on pages 65-66 of this report.
Other Supplementary Information
The combining statements referred to earlier in connection with non-major Governmental Funds are presented immediately following the Notes to the financial statements. Combining statements and schedules can be found on pages 67-89 of this report.
Financial Analysis of Government-Wide Financial Statements The City’s total assets and deferred outflows of resources in governmental activities exceeded its liabilities and deferred outflows of resources by $63.6 million at the end of the fiscal year (“FY”), an increase in net position of $1.9 million.
Condensed Governmental Activities Net Position at June 30 ($ in Millions) 2022 2021
Cash and investments 40.1 $ 44.9 $
Other assets 8.1 8.1
Capital assets 90.9 78.8
Total assets 139.1 131.8
Deferred outflows of resources - pension items 10.2 9.6 Net pension liabilities 29.0 45.0
Long-term debt 22.8 24.8
Other liabilities 10.4 7.7
Total liabilities 62.2 77.5
Deferred inflows of resources - pension items 23.5 2.2
Net position:
Net investment in capital assets 72.3 68.3
Restricted 13.7 13.7
Unrestricted (22.4) (20.3)
Total net position 63.6 $ 61.7 $
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CITY OF PLEASANT HILL
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2022
8 The largest portion of the City’s net position is its net investment in capital assets such as buildings, infrastructure (such as streets), and vehicles, less any related debt used to acquire those assets. The City uses these assets to provide services to citizens. This amount is reported separately because it cannot easily be liquidated to pay liabilities.
The restricted portion of the City’s net position represents resources that are subject to external restrictions on how they are used.
The Statement of Net Position for Government-Wide Statements includes three pension related balances: net pension liability, deferred outflows of resources, and deferred inflows of resources. Further details for the employee benefits can be found in Note 10 to the basic financial statements.
Cash and investments decreased by $4.8 million in FY 21/22 due to the construction of the new library for $13.4 million. This was offset by receiving $4.2 million in American Rescue Plan Act (ARPA) funds and $2.6 million in additional sales tax revenues from the previous year.
Net pension liabilities decreased $16.0 million to $29.0 million and deferred inflows of resources for pension items increased $21.3 million to $23.5 million in FY 21/22, due to strong investment returns by CalPERS in FY 20/21. CalPERS always reports financial information a year behind, so the impact of FY 20/21 investment returns of 21.3% are included in the City’s current year financial reports. The assumed rate of return by CalPERS is
7.15%, therefore the higher investment return results in lower pension liability and higher deferred investment income. It is important to note, CalPERS has disclosed its preliminary investment return is -6.1% for FY 21/22.
Governmental Activities
The table below shows that Governmental Activities net position increased by $1.9 million in FY 21/22.
Changes in Governmental Activities Net Position ($ in Millions) 2022 2021
Expenses
General government 13.2 $ 8.4 $
Public safety 13.8 12.9
Transportation 9.0 12.3
Community development 2.8 2.4
Interest and fiscal charges 0.4 0.5
Total expenses 36.5 39.2
Revenue
Program revenues:
Charges for services 3.1 2.8
Operating contributions and grants 4.6 7.4
Capital contributions and grants 0.2 0.6
Subtotal program revenues 10.8 7.9
General revenues:
Property taxes 8.7 8.3
Sales taxes 11.0 10.6
Measure K transactions and use tax 5.3 4.9
Transient occupancy tax 2.2 1.6
Other taxes 6.4 5.1
Investment earnings (0.5) 0.2
Miscellaneous 0.1 0.1
Subtotal general revenues 30.8 33.2
Total revenues 41.6 41.1
Changes in net position 5.1 1.9
Net position, beginning 61.7 56.6
Net Position, ending 63.6 $ 61.7 $
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CITY OF PLEASANT HILL
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2022
9 Revenue Highlights
Total governmental revenues decreased by $0.5 million to $41.1 million in FY 21/22 due to a decrease in program revenues of $2.9 million and an increase in general revenues of $2.4 million.
Program Revenues
Operating contributions and grants decreased by $2.9 million. The decrease is due to the City receiving $0.5 million in the current year and $4.0 million in the prior year from the County of Contra Costa and Pleasant Hill Recreation & Park District related to the Backbone Infrastructure Cost Sharing Agreement for the Oak Park Boulevard/Monticello Avenue Roadway Improvements project. Grant revenues and contributions from other agencies typically vary year over year depending upon the stage of projects underway during the year.
General Revenues
Property taxes increased by $0.4 million due to higher assessed valuations on residential properties that have changed ownership.
Sales tax and Measure K transactions use tax revenues increased by $0.8 million. The impact of the COVID-19 pandemic was mitigated by increased online sales that resulted in a larger pool allocation and strong auto sales.
Transient occupancy tax increased $0.6 million as COVID-19 health restrictions eased and both business and personal travel slowly return.
Expense Highlights
Expenses are classified by governmental function. Total expenses for governmental activities were $39.2 million, which was $2.7 million higher than the prior year. Major reasons for the net overall increase are explained below.
General government and public safety expenses increased due to higher costs related to several factors. California continues to be impacted by natural disasters and legal settlements, which have a direct impact on insurance premiums to the City. In addition, the City had higher accrual and benefit payments to former employees who retired after years of service. Finally, the City’s unfunded pension costs continue to rise to $3.5 million, which is a $0.6 million increase in FY 21/22. Transportation expenses were higher by $0.4 million due to the composition and timing of projects during the year primarily in the Gas Tax Fund.
The following table presents the net expense of each of the City’s governmental activities. Net expense is defined as total program cost over the revenue generated by the program through charges for services, grants, and contributions.
Net Expenses of Governmental Activities ($ in Millions) 2022 2021
General government (11.9) $ (7.7) $
Public safety (13.4) (12.6)
Transportation (5.1) (4.6)
Community development (0.4) (0.5)
Interest and fiscal charges (0.4) (0.5)
Total $ (25.9) (31.2) $
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CITY OF PLEASANT HILL
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2022
10 Overall, program revenues collected are significantly lower than the program expenses. Consequently, the City is very dependent upon general revenues, particularly property and sales taxes. In April 2022, the City Council adopted by resolution an updated General Fund reserve policy that kept the $5 million Reserve for Working Capital and modified the $5 million Budget Stabilization Reserve. The Budget Stabilization Reserve is $4 million with $1 million going to the Pension Rate Stabilization Reserve. The $1 million was deposited into a Section 115 Pension Trust to help the City address pension costs as interest income is earned over time. This contingency reserve is available for working capital needs and to mitigate the impacts of an economic downturn or unplanned major expenditure.
Business-Type Activities
The Statement of Net Position and Statement of Activities present a summary of the City’s Business-Type Activities, which is only comprised of the City’s Diablo Vista Water Enterprise Fund.
Condensed Business-Type Activity Net Position ($ in Millions) 2022 2021
Cash and investments 0.9 $ 0.7 $
Capital assets 0.4 0.5
Total assets 1.3 1.2
Net position:
Net investment in capital assets 0.4 0.5
Unrestricted 0.9 0.7
Total net position 1.3 $ 1.2 $
The net position of the business-type activity was $1.3 million at June 30, 2022, which consisted of a $0.4 million investment in capital assets and $0.9 million of unrestricted net position. The overall net position remained consistent when compared to the prior fiscal year.
Changes in Business-type Activity Net Position ($ in Millions) 2022 2021
Expenses
Diablo Vista Water 0.3 $ 0.4 $
Revenue
Program revenues:
Charges for services 0.1 0.1
General revenues 0.3 0.3
Total revenues 0.4 0.4
Changes in net position - 0.1
Beginning net position 1.2 1.2
Ending net position 1.3 $ 1.2 $
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CITY OF PLEASANT HILL
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2022
11 Financial Analysis of Governmental Funds
As discussed earlier, the City uses governmental fund accounting to ensure compliance with finance-related legal requirements.
Governmental Funds
The City’s Governmental Funds Statement provides information on short term inflows, outflows and the balance of spendable resources. Unassigned fund balance illustrates the City’s net resources available for discretionary use.
As of June 30, 2022, the City’s governmental funds reported a combined fund balance of $38.4 million.
Approximately $1.3 million of the combined total fund balance is unassigned and available for spending at the City’s discretion. The remainder of the fund balance is either restricted ($17.4 million), committed ($1.8 million), or assigned ($17.8 million). The restricted portion includes $4.2 million from loan proceeds for the library project in the General Fund. The assigned portion includes approximately $3.6 million for General Fund encumbrances, with $2.7 million related to library construction, $1.6 million for various capital projects, and $10.0 million for contingencies associated with cash flow, pension stabilization, economic uncertainty or catastrophic events.
General Fund
Balance Sheet
The General Fund is the primary operating fund of the City. At the end of FY 21/22, the fund balance for the General Fund was $22.1 million, compared to $33.1 million in the prior year. The $11.0 million decrease was due to capital outlay costs of $13.4 million for the construction of the nearly completed library. This was financed in the prior year when the City entered into a lease financing private placement loan transaction with the Bank of the West for $26.4 million.
Revenues
Total General Fund revenues, excluding other financing sources, increased by $4.2 million over FY 20/21 for a total of $34.9 million for FY 21/22. The year-over-year change in revenue sources is noted below.
General Fund Revenues for the Year Ended June 30 ($ in Millions) 2022 2021 Incr./(Decr.)
Revenues by Sources:
Property Tax 8.0 $ 7.7 $ 0.3 $
Sales Tax 11.4 9.2 2.2
Measure K Transaction & Use Tax 5.3 4.8 0.5
Transient Occupancy Tax 2.2 1.6 0.6
Other Taxes 6.2 5.2 1.0
Licenses and Permits 1.4 1.0 0.4
Intergovernmental 0.3 0.5 (0.2)
Charges for Services 0.5 0.5 -
Use of Money and Property (0.5) 0.1 (0.6)
Other 0.1 0.1 -
Total Revenues $ 30.7 34.9 $ 4.2 $
9.1.a
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2022
12 Property taxes increased by $0.3 million year-over-year to $8.0 million. The increase was primarily due to higher assessed valuations on residential properties that have changed ownership.
COVID-19 related business shutdowns and macroeconomics did not negatively affect local sales tax and Measure K transactions and use tax for the fiscal year. The City continued to see improving sales tax growth due to several factors: strong auto and other durable goods sales; the increase in business-to-business transactions; and additional taxes from marketplace facilitators from online sales, which led to a larger pool allocation.
Transient Occupancy Tax (TOT) revenues was heavily impacted by the COVID-19 pandemic due to less travel for personal and business purposes. TOT revenues are slowly recovering but have not returned to pre-COVID-19 levels. The revenue increased $0.6 million to $2.2 million in FY 21/22.
Intergovernmental revenue decreased primarily due to receipt of one-time Coronavirus Aid, Relief, and Economic Security Act (CARES Act) funding of $0.4 million in FY 20/21.
Use of Money and Property decreased $0.6 million due to rising interest rates, which caused a negative fair value adjustment. This adjustment resulted from the requirement by the Governmental Accounting Standard Board Statement No. 31 (GASB 31), beginning in 1998, to record the fair value of investments at June 30. The intent of GASB 31 was to reflect the resale value of the City’s investments at a point in time. The GASB 31 unrealized investment gain in the prior year was $0.1 million due to historically low interest rates. As inflation rose, the U.S.
Department of Treasury responded by raising interest rates. The One Year U.S. Treasury rate rose from 0.07% in FY 20/21 to 2.8% in FY 21/22, which is a significant increase. The increase in interest rates results in an unrealized loss of $0.6 million, since the City’s fair value of investments declined. In general, the City holds investments to maturity and the fair value adjustment has no impact to ongoing operations but is required to be reported. Further details can be found in Note 3 to the basic financial statements.
Expenditures
Total General Fund expenditures increased by $7.5 million over the FY 20/21 amount for a total of $43.1 million for FY 21/22. The year-over-year change in significant expenditures by function is noted below.
General Fund Expenditures for the Year Ended June 30 ($ in Millions) 2022 2021 Incr./(Decr.)
Expenditures by Function and Type
General Government 9.0 $ 7.8 $ 1.2 $
Public Safety 12.3 11.3 1.0
Transportation 3.7 2.7 1.0
Community Development 2.2 1.9 0.3
Capital Outlay 13.4 9.8 3.6
Debt Service - Principal 2.1 1.6 0.5
Debt Service - Interest and
fiscal charges 0.4 0.5 (0.1)
Total Expenditures $ 35.6 43.1 $ 7.5 $
The higher capital outlay expenditures of $13.4 million were mainly due to increased construction activity for the new library project. General government and public safety increased due to higher insurance premiums, benefit accrual payments and pension costs. FY 21/22 is the first full year of debt service on the lease financing the private placement loan that the City entered into during FY 20/21 for $2.1 million. Transportation costs returned to pre COVID-19 levels as work moved forward on 85 Cleaveland Road, traffic engineering support, and purchase of maintenance equipment.
9.1.a
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2022
13 Other Financing Sources (Uses)
General Fund Other Financing Sources (Uses) for the Year Ended June 30 ($ in Millions) 2022 2021 Incr./(Decr.)
Other Financing Sources (Uses)
Transfers In 0.7 $ 0.9 $ (0.2) $
Transfers Out (3.4) (1.8) (1.6)
Proceeds from issuance of
long term debt - 26.4 (26.4)
Total Other Financing Sources (Uses) $ 25.5 (2.7) $ (28.2) $ During FY 21/22, the City transferred $3.4 million out of General Fund Other Financing Sources, whereas $1.8 million was transferred during the prior year. Transfers to other funds were $1.6 million higher than prior years due to a couple of factors: a) General Fund transfers of Measure K funds to the Gas Tax fund increased $0.4 million to $1.2 million as initial concerns of a drop in sales tax revenues faded due to COVID-19; b) One time revenue for Republic Services was transferred to the Capital Projects Fund for $0.5 million; c) Additional funding for technology replacement and vehicle replacement funding for capital costs for $0.4 million. The transfer of funds fluctuates year-to-year due to the discretionary operating or capital needs among funds as directed by the managing departments.
Traffic Mitigation Fund
The Traffic Mitigation fund accounts for revenues such as grants and fees assessed on new development. Traffic Mitigation funds are primarily used for the enhancement and expansion to the City’s transit, bicycle, and pedestrian facilities. Revenues vary year–to-year based on the amount of fees collected by the City. During FY 21/22, the fund received charges for services and interest of $0.1 million and the fund balance was $0.2 million.
Measure J Growth Management Fund
The Measure J Growth Management fund accounts for resources for transportation improvement and maintenance that are distributed by the Contra Costa Transportation Authority to the City annually from the countywide Measure J program. Measure J is a one-half cent countywide transportation sales tax approved by Contra Costa County voters in 2004 to help generate funding for various transportation improvement and maintenance programs throughout Contra Costa County.
Total revenue and expenditures, including transfers between funds, were $1.0 million and $1.6 million, respectively. It is typical for revenue and expenditures to vary year-to-year due to the timing of projects and reimbursements for grants. The fund balance was $0.1 million as of June 30, 2022.
Gas Tax Fund
The Gas Tax fund accounts for gas taxes apportioned by the State and grants for capital projects. The authorization for the levy and expenditure of gas taxes is codified in the California Streets and Highway Code, Sections 2103- 2107. Gas tax is apportioned to cities based on three factors: vehicle registration, assessed valuation, and population. These funds are restricted to engineering and administrative costs related to street projects. On April 28, 2017, Senate Bill 1 (SB 1) was signed into law by the California Governor. SB 1 imposed additional fuel tax and vehicle fees to supplement funding for roadway maintenance and other transportation needs in the State. A portion of SB 1 is allocated to the City for roadway maintenance or improvement projects.
9.1.a
Packet Pg. 46
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2022
14 The Gas Tax fund had an excess of revenues over expenditures, including transfers to/from other funds, of $3.0 million during FY 21/22. Grant revenue and gas tax apportionments were $2.2 million, transfers in from other funds were $2.1 million, and expenditures were $1.4 million. During the year, $1.0 million in Measure K funds were transferred in from the General Fund. These funds will be used for the street program and pedestrian and bicycle program. The Gas Tax fund has a fund balance of $4.9 million at June 30, 2022.
Low and Moderate Income Housing Asset Fund
Redevelopment agencies in California were dissolved effective February 1, 2012. Successor agencies and oversight boards oversee the dissolution and the winding-down of redevelopment activities. At the City Council meeting on January 9, 2012, the City Council adopted Resolution 3-12 determining it would serve as Successor Agency to the Pleasant Hill Redevelopment Agency and elected to serve as the Housing Successor Agency, which would retain the housing assets, functions, and powers performed by the former Agency. The City no longer serves as the Successor Agency to the Redevelopment Agency, however, it continues to serve as the Housing Successor Agency. The Housing Successor Agency’s financial data and transactions are reported in the City’s Low and Moderate Income Housing Asset major governmental fund. The Low and Moderate Income Housing Asset Fund had a restricted fund balance of $5.2 million as of June 30, 2022. The fund balance remains consistent from prior years when the housing assets and liabilities were transferred to this fund.
American Rescue Plan Act Fund
The American Rescue Plan Act (ARPA) fund accounts for the resources provided by the federal government to assist with the impacts of COVID-19. ARPA established a State and Local Fiscal Recovery Fund which provided $130 billion for local governments to enable them to continue to support the public health response and assist with economic recovery. The City received an ARPA allocation for $8.3 million, which is paid in two tranches. The first tranche was received in July for $4.2 million and the second funding tranche was received in early Fiscal Year 2023. Eligible costs must be expended between March 3, 2021 and December 31, 2026, and obligated by December 31, 2024.
The City obligated $2.5 million and spent $1.0 million as of June 30, 2022. A majority of the ARPA funds were used to deal with health and safety considerations from COVID-19 and the Gregory Garden Storm Drain Project for $0.1 million and $0.7 million, respectively. The remaining $3.2 million received is considered unearned revenues until authorized expenditures are incurred.
Other Governmental Funds
These funds are not presented separately in the basic financial statements, but are individually presented as other supplementary information.
Financial Analysis of Enterprise Fund
Diablo Vista Water System Enterprise Fund
The Diablo Vista Water (“DVW”) system provides raw canal water for irrigation purposes to 474 homes. In order to maintain the system, a usage fee of $150 per household per year was adopted by City Council Ordinance No. 786 on June 21, 2004, and took effect in FY 2004/05. An additional Capital Improvements fee of $135 per household per year was also approved, and was phased in over three years, beginning in FY 2004/05. The fees help to provide a financially solvent system. See analysis of the fund in the Business-type Activities analysis above.
9.1.a
Packet Pg. 47
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2022
15 General Fund Budgetary Highlights
Revenues and other financing sources, were originally budgeted at $30.8 million and increased to $31.5 million in the final budget. Expenditures, including transfers to other funds, were originally budgeted at $47.7 million and increased to $50.3 million in the final budget.
The FY 21/22 final budget projected the General Fund would have a deficit of $18.8 million. It is important to note that the General Fund includes Measure K and $13.4 million in capital costs for the new library funded by $26.4 million in financing in the prior year. At the close of FY 21/22, the actual deficit was $11.0 million.
Significant items contributing to the variance of $7.8 million are as follows:
Total revenues were $3.9 million higher than budgeted. The most significant increase was due to sales taxes and Measure K transactions and use tax revenues which were $3.3 million higher due to solid growth in online sales and a surge in purchases of new and used vehicles.
Total expenditures were $4.0 million lower than budgeted. This variance was primarily due to the timing of expenditures for the Measure K library project, in which expenditures were lower than the budgeted amount by $3.0 million.
Capital Assets
The City’s infrastructure capital assets include streets, storm drains, streetlights, and traffic control devices. Each year, based on the determination of the City’s Engineering Division, completed projects that meet certain criteria are capitalized. Capitalizable projects that are under construction at fiscal year-end are recorded as constructionin-progress and are capitalized as depreciable assets in the year they are completed. Capital assets and accumulated depreciation that are recorded in the City’s financial statements are shown in the table below. Further details for the capital assets can be found in Note 7 to the basic financial statements.
Capital Assets as of June 30 ($ in Millions)
2022 2021
Governmental Activities:
Land 3.4 $ 3.4 $
Construction in progress 28.4 20.8
Buildings and improvements 15.1 15.1
Equipment and furniture 11.2 10.3
Streets and roads 68.6 65.4
Curbs and gutters 16.9 16.7
Storm drains 11.0 8.0
Street lights 4.1 4.0
Traffic control devices 6.7 6.4
Less: accumulated depreciation (74.5) (71.3)
Total 90.9 $ 78.8 $
Business-type Activities:
Water system infrastructure 0.8 $ 0.8 $
Less: accumulated depreciation (0.4) (0.3)
Total 0.4 $ 0.5 $
9.1.a
Packet Pg. 48
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2022
16 During FY 21/22, construction in progress increased by $7.6 million related to the new City Library project.
Streets and roads increased with the completion of the Oak Park Boulevard/Monticello Avenue Roadway Improvements project. The City also purchased $0.9 million in equipment and furniture during the year. The City depreciates its depreciable capital assets over their estimated useful lives. Current year depreciation expenses totaled $3.2 million. Additional information on the estimated useful life of each capital asset category may be found in Note 1(H).
Long-Term Debt
The City issued $26.4 million in long-term debt for the construction of a new library building, and a portion of the Oak Park Monticello Backbone Infrastructure Improvements through a private placement loan with a bank on August 1, 2020. As of June 30, 2022, total debt service remaining on the capital financing is $22.8 million with annual debt service of $2.5 million. Further details for the long-term debt can be found in Note 8 to the basic financial statements.
Economic Factors
The economic factors of the City is discussed in the accompanying Transmittal Letter.
Request for Information
This Annual Comprehensive Financial Report (ACFR) is intended to provide residents, taxpayers, investors, and creditors with a detailed overview of the City’s finances. Questions about this report should be directed to the Finance Department at 100 Gregory Lane, Pleasant Hill, CA 94523.
9.1.a
Packet Pg. 49
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Statement of Net Position
June 30, 2022
Governmental Business-Type
Activities Activities Total
Assets:
Cash and investments held in City Treasury 40,115,664 $ 891,024 $ 41,006,688 $ Receivables:
Accounts and others 4,075,544 - 4,075,544
Grants 118,890 - 118,890
Interest 73,477 1,691 75,168
Advances to the Successor Agency Trust Fund 572,835 - 572,835 Notes and loans receivable, net 1,983,094 - 1,983,094
Land held for redevelopment 191,049 - 191,049
Restricted cash and investments with trustees 999,755 - 999,755 Capital assets:
Nondepreciable 31,776,149 - 31,776,149
Depreciable, net of accumulated depreciation 59,150,758 439,940 59,590,698 Total assets 139,057,215 1,332,655 140,389,870
Deferred outflows of resources - Pension items 10,226,724 - 10,226,724 Liabilities:
Accounts payable and accrued liabilities 2, 35,967 838,474 2,874,441 Deposits payable 2,049,841 - 2,049,841
Unearned revenue 3,152,064 - 3,152,064
Interest payable 31,578 - 31,578
Compensated absences payable:
Due within one year 456,000 - 456,000
Due in more than one year 1,826,223 - 1,826,223
Noncurrent liabilities:
Long-term debt - Due within one year 2,102,993 - 2,102,993 Long-term debt - Due in more than one year 20,670,698 - 20,670,698 Net pension liability - Due in more than one year 29,035,811 - 29,035,811 Total liabilities 62, 35,967 163,682 62,199,649
Deferred inflows of resources - Pension items 23,541,729 - 23,541,729 Net position:
Net investment in capital assets 72,317,902 439,940 72,757,842 Restricted for:
Special revenue:
General government 583,332 - 583,332
Public safety projects 506,578 - 506,578
Transportation projects 4,351,431 - 4,351,431
Community development projects 8,127,558 - 8,127,558
Capital projects 114,655 - 114,655
Total restricted net position 13,683,554 - 13,683,554
Unrestricted (22,422,928) 856,748 (21,566,180)
Total net position $ 63,578,528 $ 1,296,688 $ 64,875,216 See accompanying notes to basic financial statements.
17 9.1.a
Packet Pg. 50
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Statement of Activities
For the Year Ended June 30, 2022
Net (Expense) Revenue and
Program Revenues Changes in Net Position
Operating Capital
Charges for Grants and Grants and Governmental Business-type Functions/Programs Expenses Services Contributions Contributions Activities Activities Total Governmental Activities:
General government $ 219,754 13,230,100 $ 1,066,328 $ 72,271 $ $ - (11,871,747) $ $ (11,871,747) Public safety 152,063 13,757,204 162,723 - - (13,442,418) (13,442,418) Transportation 9,043,753 559,516 3,219,883 136,110 - (5,128,244) (5,128,244) Community development 2,200,779 2,735,359 154,459 - - (380,121) (380,121) Interest and fiscal charges 422,838 - - - - (422,838) (422,838) Total governmental activities 39,189,254 3,132,112 4,603,393 208,381 - (31,245,368) (31,245,368) Business-type activities:
Diablo Vista Water System 133,950 267,391 - - - (133,441) (133,441) $ 3,266,062 39,456,645 $ 4,603,393 $ 208,381 $ (31,245,368) (133,441) (31,378,809) General revenues:
Taxes:
Property taxes 263,325 8,714,018 8,977,343
Sales taxes - 11,001,808 11,001,808
Measure K transactions & use tax - 5,344,293 5,344,293
Transient occupancy taxes - 2,236,918 2,236,918
Franchise taxes - 2,628,874 2,628,874
Other taxes - 3,545,685 3,545,685
Investment earnings 3,169 (447,458) (444,289)
Miscellaneous - 132,263 132,263
Total general revenues 266,494 33,156,401 33,422,895
Change in net position 133,053 1,911,033 2,044,086
Net position, beginning of year 1,163,635 61,667,495 62,831,130 Net position, end of year $ 1,296,688 63,578,528 $ 64,875,216 $ See accompanying notes to basic financial statements.
18 9.1.a
Packet Pg. 51
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Governmental Funds
Balance Sheet
June 30, 2022
Low and
Measure J Moderate American Other
Traffic Growth Income Rescue Plan Governmental
General Mitigation Management Gas Tax Housing Asset Act Funds Total Assets:
Cash and investments held in City Treasury $ 176,130 22,384,949 $ $ 4, 102,490 $ 2,997,775 755,330 $ 3,154,113 $ 6,544,877 $ 40,115,664 $ Receivables:
Accounts and other - 3,802,365 1,140 - 127,011 - 4, 145,028 075,544 Grants 27,500 - - - - - 91,390 118,890
Interest 332 56,566 193 9,217 - - 7,169 73,477
Advances to the Successor Agency Trust Fund - - - - - 572,835 - 572,835 Due from other funds 102,614 - - - - - - 102,614
Notes and loans receivable, net - - - - 1, - 983,094 - 1, 983,094 Land held for redevelopment - - - - - 191,049 - 191,049 Restricted cash and investments with trustees 999,755 - - - - - - 999,755 Total assets 27,373,749 $ 176,462 $ $ 4, 103,823 $ 5,744,753 891,558 $ 3,154,113 $ 6,788,464 $ 48,232,922 $ Liabilities, Deferred Inflows of Resources
and Fund Balances:
Liabilities:
Accounts payable and
accrued liabilities 2, $ - 155,732 $ 41,447 $ 15,304 $ 2,934 $ 2,049 $ $ 2, 621,008 $ 838,474 Deposits payable 2,049,841 - - - - - - 2, 049,841
Unearned revenue - - - - - 3, - 152,064 3, 152,064
Due to other funds - - - - - - 102,614 102,614
Total liabilities 4, - 205,573 41,447 15,304 2,934 3, 723, 154,113 8, 622 142,993 Deferred inflows of resources - unavailable revenue 1,069,827 - - - - 569,409 91,390 1, 730,626 Fund balances (deficits):
Restricted 176, 4,164,686 62,376 462 3, 5, 701,623 - 172,410 4, 17, 077,465 355,022 Committed - - - - - - 1, 1, 824,678 824,678
Assigned - 16,535,198 - 1, - 174,631 - 17, 175,000 884,829 Unassigned - 1,398,465 - - - - 1, (103,691) 294,774
Total fund balances 22,098,349 176,462 62,376 4, 5, 876,254 - 172,410 5, 38, 973,452 359,303 Total liabilities, deferred inflows of
resources and fund balances 27,373,749 $ 176,462 $ $ 4, 103,823 $ 5,744,753 891,558 $ 3,154,113 $ 6,788,464 $ 48,232,922 $ See accompanying notes to basic financial statements.
19 9.1.a
Packet Pg. 52
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position - Governmental Activities June 30, 2022
Total fund balances reported on the governmental funds balance sheet 38,359,303 $ Amounts reported for governmental activities in the statement of net position are different from those reported in the governmental funds above because of the following:
Capital assets:
Capital assets used in governmental activities are not current assets or financial resources and therefore are not reported in the governmental funds. 90,926,907 Deferred outflows of resources and deferred inflows of resources:
Certain items are not financial resources, and therefore, are not reported in the governmental funds:
Deferred outflows of resources - Pension items 10,226,724 Deferred inflows of resources - Pension items (23,541,729) Receivables not available:
Certain receivables are not available to pay for current period expenditures and therefore are deferred in the governmental funds. 1,730,626 Long-term liabilities:
The liabilities below are not due and payable in the current period and therefore are not reported in the governmental funds:
Bonds payable (22,773,691)
Interest payable (31,578)
Compensated absences (2,282,223)
Net pension liability (29,035,811)
Net position of governmental activities 63,578,528 $
See accompanying notes to basic financial statements.
20 9.1.a
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Governmental Funds
Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended June 30, 2022
Low and
Measure J Moderate American Other
Traffic Growth Income Rescue Plan Governmental
General Mitigation Management Gas Tax Housing Asset Act Funds Total Revenues:
Property taxes 8,037,560 $ - $ - $ - $ - $ - $ 676,458 $ 8,714,018 $ Sales taxes 11,377,990 - - - - - - 11,377,990
Measure K transactions & use tax 5,344,293 - - - - - - 5,344,293 Transient occupancy taxes 2,236,918 - - - - - - 2,236,918 Other taxes and
special assessments 6,167,749 - - - - - 812,529 6,980,278 Licenses and permits 1,380,049 - - - - - - 1,380,049
Intergovernmental 274,999 - 989,663 2,184,810 - 1,015,051 352,283 4,816,806 Charges for services 508,456 85,046 - - - - 311,690 905,192 Fines and forfeitures 9,739 - - - - - 38,119 47,858
Use of money and property 605 (555,702) 795 16,635 76,026 - 14,184 (447,457) Other - 73,042 - - - - - 73,042
Total revenues 34,855,093 85,651 990,458 2,201,445 76,026 1,015,051 2,205,263 41,428,987 Expenditures:
Current:
General government - 9,012,186 - - - 136,754 244,450 9,393,390 Public safety - 12,323,055 - - - - 321,787 12,644,842
Transportation 3,708,568 9,836 375,765 1,364,158 - - 818,083 6,276,410 Community development - 2,185,644 35,765 - 47,664 - 361,952 2,631,025 Capital outlay - 13,390,351 - - - - 2,148,938 15,539,289 Debt service:
Principal 2,066,668 - - - - - - 2,066,668
Interest and fiscal charges 425,704 - - - - - - 425,704 Total expenditures 43,112,176 9,836 411,530 1,364,158 47,664 136,754 3,895,210 48,977,328 Excess (deficiency) of revenues
over (under) expenditures (8,257,083) 75,815 578,928 837,287 28,362 878,297 (1,689,947) (7,548,341) Other financing sources (uses):
Proceeds from sale
of capital assets 279 - - - - - 19,510 19,789
Transfers in 648,295 - - 2,143,000 - - 3,144,004 5,935,299 Transfers out (3,395,502) - (1,000,000) - - (878,297) (661,500) (5,935,299) Total other financing
sources (uses) (2,746,928) - (1,000,000) 2,143,000 - (878,297) 2,502,014 19,789 Change in fund balances (11,004,011) 75,815 (421,072) 2,980,287 28,362 - 812,067 (7,528,552) Fund balances, beginning of year 100,647 33,102,360 483,448 1,895,967 5,144,048 - 5,161,385 45,887,855 Fund balances, end of year 22,098,349 $ 176,462 $ 62,376 $ 4,876,254 $ 5,172,410 $ - $ 5,973,452 $ 38,359,303 $ See accompanying notes to basic financial statements.
21 9.1.a
Packet Pg. 54
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities - Governmental Activities For the Year Ended June 30, 2022
Net change in fund balances - total governmental funds (7,528,55 $ 2) Amounts reported for governmental activities in the statement of activities are different because of the following:
Capital assets transactions:
Governmental funds report capital outlays as expenditures. However, in the statement of activities, the cost of those assets is capitalized and allocated over their estimated useful lives and reported as depreciation expense.
Expenditures for capital assets reported as:
Capital outlay 15,539,289
Current transportation (116,562)
Less current year depreciation (3,249,562)
Pension transactions:
Pension contribution made subsequent to the measurement date is an expenditure in the governmental funds, but reported as a deferred outflows of resources in the government-wide financial statements 5,263,128
Pension expense reported in the statement of activities does not require the use of current financial resources and, therefore, is not reported as an expenditure in governmental funds (10,023,328) Long-term debt transactions:
Repayment of debt principal is an expenditure in the governmental funds, but in the statement of net position the repayment reduces long-term liabilities. 2,066,668 Accrual of noncurrent items:
The amounts below included in the statement of activities do not provide or use current financial resources and therefore are not reported as revenues or expenditures in governmental funds:
Change in compensated absences 305,575
Change in interest payable 2,866
Change in deferred inflows of resources - unavailable revenue (3 48,489) Change in net position of governmental activities 1,911,033 $ See accompanying notes to basic financial statements.
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
General Fund
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2022
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
Revenues:
Property taxes 3,663,148 $ 3,663,148 $ 3,978,037 $ 314,889 $ Property tax in lieu of Vehicle License Fee 4,016,916 4,016,916 4,059,523 42,607 Sales taxes 9,412,285 9,412,285 11,377,990 1,965,705
Measure K transaction & use tax 4,053,000 4,053,000 5,344,293 1,291,293 Transient occupancy taxes 2,438,993 2,438,993 2,236,918 (202,075) Other taxes 5,272,124 5,272,124 6,167,749 895,625
Licenses and permits 944,571 944,571 1,380,049 435,478
Intergovernmental 108,321 108,321 274,999 166,678
Charges for current services 456,094 456,094 508,456 52,362 Fines and forfeitures 59,225 59,225 9,739 (49,486)
Use of money and property 253,705 101,805 (555,702) (809,407) Other 256,205 256,205 73,042 (183,163)
Total revenues 30,782,687 30,934,587 34,855,093 3,920,506 Expenditures:
Current:
General government:
City Council 167,209 167,209 136,192 31,017
City Manager 964,635 1,034,674 819,581 145,054
City Attorney 506,996 506,996 445,708 61,288
City Clerk 127,663 127,663 103,478 24,185
City Treasurer 11,290 11,290 11,930 (640)
Finance 856,537 871,187 897,780 (26,593)
Computer services 588,728 588,728 441,160 147,568
Human Resources 766,635 742,510 625,120 141,515
Risk management 739,458 739,458 805,855 (66,397)
City Hall facility 145,512 145,512 158,706 (13,194)
Measure K 4,630 - 17,284 (12,654)
Non-departmental 4,092,931 4,092,931 4,549,392 (456,461) Total general government 8,986,874 9,013,508 9,012,186 (25,312) Public safety:
Police 12,040,693 12,314,827 12,323,055 (8,228)
Transportation:
Public works administration 1,480,510 1,067,015 1,017,710 462,800 Public works maintenance 2,777,120 2,520,742 2,690,858 86,262 Total transportation 4,257,630 3,587,757 3,708,568 549,062 Community development:
Planning 994,327 982,583 882,410 111,917
Building inspection 681,562 681,562 765,471 (83,909)
Community relations 487,519 468,523 284,740 202,779
Economic development 403,293 402,560 253,023 150,270
Total community development 2,566,701 2,535,228 2,185,644 381,057 Capital outlay - Measure K 16,480,480 16,480,480 13,390,351 3,090,129 Debt Service:
Principal 2,066,668 2,066,668 2,066,668 -
Interest and fiscal charges 425,704 425,704 425,704 -
Total debt service 2,492,372 2,492,372 2,492,372 -
Total expenditures 46,150,038 47,098,884 43,112,176 3,986,708 Excess of revenues over expenditures (15,367,351) (16,164,297) 7,907,214 (8,257,083) Other financing sources (uses):
Proceeds from sale of capital assets 5,227 5,227 279 (4,948) Transfers in 511,500 - 648,295 136,795
Transfers out (1,520,764) (3,188,764) (3,395,502) (206,738) Total other financing sources (uses) (1,515,537) (2,672,037) (2,746,928) (74,891) Change in fund balance $ (18,836,334) (16,882,888) $ (11,004,011) 7,832,323 $ Fund balance, beginning of year 33,102,360
Fund balance, end of year $ 22,098,349
See accompanying notes to basic financial statements.
23 9.1.a
Packet Pg. 56
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Traffic Mitigation Fund
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2022
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
Revenues:
Charges for services 412,350 $ 412,350 $ 85,046 $ (327,304) $ Use of money and property 1,059 1,059 605 (454)
Total revenues 413,409 413,409 85,651 (327,758)
Expenditures:
Current:
Transportation 8,932 8,932 9,836 (904)
Change in fund balance 404,477 $ 404,477 $ 75,815 (328,662) $ Fund balance, beginning of year 100,647
Fund balance, end of year 176,462 $
See accompanying notes to basic financial statements.
24 9.1.a
Packet Pg. 57
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Measure J Growth Management Fund
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2022
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
Revenues:
Intergovernmental 525,000 $ 525,000 $ 989,663 $ 464,663 $ Use of money and property 8,823 8,823 795 (8,028)
Total revenues 533,823 533,823 990,458 456,635
Expenditures:
Current:
Transportation 667,531 667,531 375,765 291,766
Community development 33,600 33,600 35,765 (2,165)
Total expenditures 701,131 701,131 411,530 289,601
Excess (deficiency) of revenues over (under) expenditures (167,3 (167,308) 08) 578,928 746,236 Other financing sources (uses):
Transfers out (1,000,000) (1,000,000) (1,000,000) -
Change in fund balance (1,167,308) $ (1,167,308) $ (421,072) 746,236 $ Fund balance, beginning of year 483,448
Fund balance, end of year 62,376 $
See accompanying notes to basic financial statements.
25 9.1.a
Packet Pg. 58
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Gas Tax Fund
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2022
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
Revenues:
Intergovernmental 1,565,473 $ 1,565,473 $ 2,184,810 $ 619,337 $ Use of money and property - - 16,635 16,635
Total revenues 1,565,473 1,565,473 2,201,445 635,972
Expenditures:
Current:
Transportation 3,286,000 4,765,916 1,364,158 3,401,758
Excess (deficiency) of revenues over (under) expenditures (1,720 (3,200,443) ,527) 837,287 4,037,730 Other financing sources (uses):
Transfers in 2,143,000 2,143,000 2,143,000 -
Change in fund balance 422,473 $ (1,057,443) $ 2,980,287 4,037,730 $ Fund balance, beginning of year 1,895,967
Fund balance, end of year 4,876,254 $
See accompanying notes to basic financial statements.
26 9.1.a
Packet Pg. 59
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
American Rescue Plan Act Fund
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2022
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
Revenues:
Intergovernmental 4,150,000 $ 4,150,000 $ 1,015,051 $ (3,134,949) $ Expenditures:
Current:
General government 136,754 - 136,754 -
Excess of revenues over expenditures 4,150,000 4,013,246 878,297 (3,134,949) Other financing sources (uses):
Transfers out - (878,297) (878,297) -
Change in fund balance 4,150,000 $ 3,134,949 $ - (3,134,949) $ Fund balance (deficit), beginning of year -
Fund balance, end of year $ -
See accompanying notes to basic financial statements.
27 9.1.a
Packet Pg. 60
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Proprietary Fund
Statement of Fund Net Position
June 30, 2022
Diablo Vista
Water System
Enterprise Fund
Assets:
Current assets:
Cash and investments held in City Treasury 891,024 $
Interest receivable 1,691
Total current assets 892,715
Noncurrent assets:
Capital assets:
Depreciable, net of accumulated depreciation 439,940
Total assets 1,332,655
Liabilities:
Current liabilities:
Accounts payable and accrued liabilities 35,967
Net position:
Net investment in capital assets 439,940
Unrestricted 856,748
Total net position 1,296,688 $
See accompanying notes to basic financial statements.
28 9.1.a
Packet Pg. 61
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Proprietary Fund
Statement of Revenues, Expenses and Changes in Fund Net Position For the Year Ended June 30, 2022
Diablo Vista
Water System
Enterprise Fund
Operating revenues:
Water district assessments and charges 133,950 $
Operating expenses:
Purchased water 172,133
Personnel services 8,164
Contract services 13,913
Administration and office utilities 29,635
Repairs and maintenance 31,278
Depreciation 12,268
Total operating expenses 267,391
Operating loss (133,441)
Nonoperating revenues:
Property taxes 263,325
Interest income 3,169
Total nonoperating revenues 266,494
Change in net position 133,053
Net position, beginning of year 1,163,635
Net position, end of year 1,296,688 $
See accompanying notes to basic financial statements.
29 9.1.a
Packet Pg. 62
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Proprietary Fund
Statement of Cash Flows
For the Year Ended June 30, 2022
Diablo Vista
Water System
Enterprise Fund
Cash flows from operating activities:
Cash received from customers 133,950 $
Cash payments to suppliers for goods and services (237,643) Cash payments to other funds for services provided (8,164) Net cash used in operating activities (111,857)
Cash flows from noncapital financing activities:
Property tax received 263,325
Cash flows from investing activities:
Interest income received 2,039
Net change in cash and cash equivalents 153,507
Cash and cash equivalents, beginning of year 737,517
Cash and cash equivalents, end of year $ 891,024
Reconciliation of operating loss to
net cash used in operating activities
Operating loss (133,441) $
Adjustments to reconcile operating loss to
net cash used in operating activities:
Depreciation 12,268
Change in accounts payable and accrued liabilities 9,316 Net cash used in operating activities $ (111,857)
See accompanying notes to basic financial statements.
30 9.1.a
Packet Pg. 63
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Fiduciary Funds
Statement of Fiduciary Net Position
June 30, 2022
Private-Purpose
Trust Fund -
Successor Custodial
Agency Funds
Assets:
Cash and investments:
Held in City Treasury 2,905,503 $ 301,861 $
Receivables:
Interest 4,031 419
Loans receivable 169,104 -
Land held for redevelopment 86,100 -
Total assets 3,164,738 302,280
Liabilities:
Accounts payable and accrued liabilities 5,543 70,265
Interest payable 59,821 -
Advances from the Low and Moderate Income Housing Asset Fund 572 - ,835 Long-term debt:
Due within one year 285,000 -
Due in more than one year 3,665,000 -
Total liabilities 4,588,199 70,265
Net Position (Deficit):
Restricted for governmental entities and others - 232,015 Unrestricted held in trust (1,423,461) -
Total net position (deficit) (1,423,461) $ 232,015 $
See accompanying notes to basic financial statements.
31 9.1.a
Packet Pg. 64
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Private-Purpose
Trust Fund -
Successor Custodial
Agency Funds
Additions:
Redevelopment property tax revenues 3,798,667 $ - $
Investment earnings 20,937 904
Members contributions - 245,496
Others 29,981 -
Total additions 3,819,604 276,381
Deductions:
Community development expenses 1,629,032 -
Interest and fiscal charges 200,030 -
Benefits paid to participants or beneficiaries - 50,679 Administrative and general - 250,014
Total deductions 1,829,062 300,693
Change in net position 1,990,542 (24,312)
Net position (deficit), beginning of year (3,414,003) 256,327 Net position (deficit), end of year (1,423,461) $ 232,015 $
CITY OF PLEASANT HILL
Fiduciary Funds
Statement of Changes in Fiduciary Net Position
For the Year Ended June 30, 2022
See accompanying notes to basic financial statements.
32 9.1.a
Packet Pg. 65
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
33 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
The City of Pleasant Hill (City) was incorporated on November 14, 1961 under the laws of the State of California. The City operates under the Council-City Manager form of government and provides the following services: public safety, transportation, community development, and general government.
The basic financial statements include the financial activities of the City, Successor Agency to the Pleasant Hill Redevelopment Agency (Successor Agency) and the Pleasant Hill Joint Powers Financing Authority (Authority).
The Successor Agency is a separate governmental entity established on February 1, 2012 for the purpose of serving as a custodian of the assets of the former Pleasant Hill Redevelopment Agency (Agency) and winding down the former Agency’s activities subject to the direction of a Countywide Oversight Board.
The Countywide Oversight Board serves as the governing body and is comprised of seven members: 1) a County of Contra Costa (County) Supervisors representative, 2) a mayor appointed by a city selection committee, 3) a special district representative, 4) a school district representative, 5) a community college district representative, 6) a member of the public, and 7) a successor agency employee appointed from the largest employer of successor agency employees in the County. The Successor Agency’s financial transactions are accounted for in a private-purpose trust fund, a fiduciary fund type.
The Authority is a separate government entity whose purpose is to assist with the financing or refinancing of certain public capital facilities within the City. The Authority is controlled by the City and is governed by a board consisting of the City Manager, City Attorney, and Finance Manager, who also manage all accounting and administrative functions for the Authority. The Authority is a blended component unit, and is in substance part of the City’s operations and has a financial benefits and burden relationship with the City.
The Successor Agency and Authority do not issue separate financial statements and are reported in the City’s basic financial statements.
B. Basis of Presentation
The City's basic financial statements are prepared in conformity with accounting principles generally accepted in the United States of America. The Governmental Accounting Standards Board (GASB) is the acknowledged standard setting body for establishing accounting and financial reporting standards followed by governmental entities in the United States.
Government-Wide Statements: The statement of net position and the statement of activities display information about the City’s primary government. These statements include the financial activities of the overall City government, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities, except where interfund services have been received or provided.
These statements distinguish between the governmental and business-type activities of the City.
Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions. The City’s business-type activities are financed in whole or in part by fees charged to external parties.
9.1.a
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
34 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) The statement of activities presents a comparison between direct expenses and program revenues for the business-type activities of the City and for each function of the City's governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Program revenues include: (a) charges paid by the recipients for goods or services offered by the programs, (b) grants and contributions that are restricted to meeting the operational needs of a particular program, and (c) fees, grants and contributions that are restricted to financing the acquisition or construction of capital assets. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.
Fund Financial Statements: The fund financial statements provide information about the City's funds, including fiduciary funds and the blended component units. Separate statements for each fund categorygovernmental, proprietary, and fiduciary are presented. The emphasis of fund financial statements is on major individual governmental and enterprise funds, each of which is displayed in a separate column. All remaining governmental funds are aggregated and reported as nonmajor funds.
Proprietary fund operating revenues include charges for services provided to customers. Operating expenses for the enterprise fund include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses.
C. Major Funds
Major funds are defined as funds that have either assets and deferred outflows of resources, liabilities and deferred inflows of resources, revenues or expenditures/expenses equal to ten percent of their governmental or enterprise fund-type total and five percent of the combined grand total. The General Fund is always a major fund. The City may also select other funds it believes should be presented as major funds.
The City reported the following major governmental funds in the accompanying basic financial statements.
General Fund - Accounts for all of the general revenues and financial resources of the City not specifically levied or collected for the other City funds, as well as the related expenditures.
Traffic Mitigation Fund - Accounts for contributions received and traffic mitigation fees assessed on new developments to provide for street or other traffic improvements.
Measure J Growth Management Fund - Accounts for resources provided by the one-half cent sales tax dedicated to transportation improvement projects.
Gas Tax Fund - Accounts for gas tax apportioned by the State to cities based upon three factors: vehicle registration, assessed valuation, and population. These funds are used for street construction and maintenance.
Low and Moderate Income Housing Asset Fund – Accounts for housing assets and functions related to the Low and Moderate Income Housing Program retained by the City following the dissolution of the former Agency. Revenues are generated from the housing assets, including loan repayments and proceeds from the sale of the housing assets.
American Rescue Plan Act Fund – Accounts for funds received from the federal government from the American Rescue Plan Act of 2021. These funds provide relief from COVID-19 pandemic-related economic impacts to the City’s operations. The funds are to be used for general City services and capital projects.
9.1.a
Packet Pg. 67
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
35 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) The City reports its only enterprise fund as a major fund in the accompanying basic financial statements.
The Diablo Vista Water System Fund - Accounts for the financing of self-supporting activities, which render irrigation water to the homeowners in a specific geographical area of the City, paid from property taxes and user charges.
The City also reports the following fiduciary funds:
Private-Purpose Trust Fund - The Successor Agency was created to serve as a custodian for the nonhousing assets and to wind down the affairs of the former Agency. This fund accounts for the receipt of property tax revenues pursuant to the Redevelopment Dissolution Act and the value of the assets transferred from the former Agency. The Successor Agency’s assets can only be used to pay enforceable obligations in existence at the date of dissolution pursuant to the Recognized Obligation Payment Schedules approved by the State Department of Finance (DOF) under the Redevelopment Dissolution Act.
Custodial Funds - Custodial funds are used to account for assets held by the City as a custodian for individuals, private organizations, and other governments. The City maintains four custodial funds.
The financial activities of these fiduciary funds are excluded from the government-wide financial statements, but are presented in separate fiduciary fund financial statements.
D. Basis of Accounting
The government-wide, proprietary, and fiduciary fund financial statements are reported using the economic resources measurement focus and the full accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place.
For the Diablo Vista Water System Enterprise Fund, revenues are billed to customers by the County of Contra Costa and are included on each customer's property tax statement. Revenues for services provided but not billed at the end of a fiscal period are not considered material and are not accrued.
Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available.
Generally, the City considers all revenues, except property tax revenues, reported in the governmental funds to be available if the revenues are collected within 45 days after year-end. Property tax revenues are recognized by the City in the fiscal year they are assessed provided they become available within 60 days after year-end for governmental funds. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt, claims and judgments, and compensated absences, which are recognized as expenditures to the extent they have matured. Governmental capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of governmental long-term debt and acquisitions under capital leases are reported as other financing sources.
Revenues susceptible to accrual include taxes, intergovernmental revenues, charges for services, and interest. Fines, licenses, and permits are not susceptible to accrual because they are not measurable until received in cash.
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
36 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Non-exchange transactions, in which the City gives or receives value without directly receiving or giving equal value in exchange, include taxes, grants, entitlements, and donations. On the accrual basis, revenue from taxes is recognized in the fiscal year for which the taxes are levied or assessed. Revenue from grants, entitlements, and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.
The City may fund programs with a combination of cost-reimbursement grants, categorical block grants, and general revenues. Thus, both restricted and unrestricted net position may be available to finance program expenditures. The City's policy is to first apply restricted grant resources to such programs, followed by general revenues if necessary.
Certain indirect costs are included in program expenses reported for individual functions and activities.
Transactions representing the exchange of interfund goods and services have also been included.
E. Cash and Cash Equivalents
For purposes of reporting cash flows for the City’s proprietary fund, pooled cash and investments held by City Treasury are considered cash equivalents as the proprietary fund can access pooled cash and investments in a manner similar to a demand deposit account.
F. Investments
The City's investments are stated at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
The fair value measurements are categorized within the fair value hierarchy established by generally accepted accounting principles. The City adjusts the carrying value of its investments to reflect their fair value at each fiscal year end, and it includes the effects of these adjustments in income for that fiscal year.
G. Interfund Transactions
Interfund loans and balances related to unsettled service transactions are reported as receivables and payables as appropriate, and are subject to elimination upon consolidation of similar fund types, and are referred to as either “due from/to other funds” (i.e., the current portion of inter-fund loans and unsettled service transactions) or “advances to/from other funds” (i.e., the non-current portion of interfund loans).
Any residual balances outstanding between the governmental activities and the business-type activities are reported in the government-wide financial statements as “internal balances”.
Services provided or used, deemed to be at market or near market rates, are treated as revenues and expenditures or expenses. Transactions constituting reimbursements to a fund for expenditures/expenses initially made from it that are properly applicable to another fund are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed. All other interfund transactions are treated as transfers. Transfers between governmental or proprietary funds, if any, are netted as part of the reconciliation to the government-wide presentation.
H. Capital Assets
Capital assets are valued at cost or estimated historical cost if actual cost is not available. Donated capital assets are stated at their acquisition value. Infrastructure capital assets consisting of streets, roads, curbs, gutters, storm drains, street drainage, street lights, and traffic control devices have been capitalized and depreciated. Capital assets are defined as assets with an initial individual cost of more than $1,500 and a useful life of in excess of one year.
9.1.a
Packet Pg. 69
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
37 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Major outlays for capital assets and improvements are capitalized as projects are constructed. Some capital assets may be acquired using federal and state grant funds, or they may be contributed by developers or other governments. These contributions are accounted for as revenues at the time the capital assets are contributed.
Depreciation is recorded using the straight-line method over the following useful lives:
Buildings and improvements 10-50 years
Equipment and furniture 3-15 years
Streets and roads 50 years
Curbs and gutters 50 years
Storm drains 50 years
Street lights 50 years
Traffic control devices 50 years
Diablo Vista Water system infrastructure 50 years
I. Deferred Outflows and Inflows of Resources
In addition to assets, the statement of net position reports a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of net assets that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then.
In addition to liabilities, the statement of net position reports a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of net assets that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time.
The City reports the following deferred items:
Deferred Outflows and Inflows of Resources Related to Pensions These deferred items are recognized and measured in financial statements prepared using the economic resources measurement focus and the accrual basis of accounting. The deferral is for changes in the net pension liability that are not included in pension expense and must be amortized in a systematic and rational manner over a closed period depending on cause beginning with the current period. These causes may include changes of future economic and demographic assumptions or other inputs, differences between expected and actual experience with regard to economic or demographic factors, differences between projected and actual earnings on pension plan investments, changes in employer’s proportion, and differences between the employer’s actual and proportionate share of contributions.
Employer contributions subsequent to the measurement date of the net pension liability are also required to be reported as deferred outflows of resources.
Unavailable Revenue
Unavailable revenue is only reported in the governmental funds balance sheet. The governmental funds report unavailable revenues from sources such as housing loans, State-mandated cost reimbursements, expenditure-driven grants, etc.
9.1.a
Packet Pg. 70
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
38 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) J. Land Held for Redevelopment
Land held for redevelopment is carried at the lower of cost, net realizable value, or agreed-upon sales price if a disposition and development agreement has been made with a developer.
K. Compensated Absences
Compensated absences are comprised of vacation and vested sick time, which are accrued as earned. The City's liability for compensated absences is recorded in governmental activities. The liability for compensated absences is determined annually. For all governmental funds, amounts expected to be permanently liquidated (matured due to termination) are recorded as fund liabilities; the long-term portion is recorded in the statement of net position.
The changes of the compensated absences were as follows for the year ended June 30, 2022:
Governmental
Activities
Beginning Balance 2,587,798 $
Additions 139,565
Payments (445,140)
Ending Balance 2,282,223 $
Current Portion 456,000 $
The compensated absences of governmental activities are liquidated primarily by the General Fund.
L. Net Pension Liability
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the City’s California Public Employees’ Retirement System (CalPERS) plans (Plans) and additions to/deductions from the Plans’ fiduciary net position have been determined on the same basis as they are reported by CalPERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. The net pension liability is typically liquidated by the General Fund.
M. Property Tax
The County distributes property taxes to jurisdictions according to the “alternate method of property tax distribution” known as the Teeter Plan. Under this plan, the County remits 100% of the levied taxes to the appropriate jurisdictions by June 30 each year, pursuing delinquencies and keeping related late penalties to cover their costs. The City receives property taxes and property tax increments, respectively, on the following schedule: 55% in December, 40% in April, and 5% in June. The lien date for secured and unsecured property taxes is established as of January 1 of the preceding fiscal year.
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Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
39 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Secured property tax is due in two equal installments, on November 1 and February 1. It becomes delinquent after December 10 and April 10, respectively. Unsecured property tax is due upon receipt of billing and becomes delinquent on August 31. The term “unsecured” refers to taxes not secured by real property. These taxes are secured by liens on the property being taxed.
Pursuant to the Redevelopment Dissolution Act, funds that would have been distributed to the former Agency as tax increment, hereafter referred to as redevelopment property tax revenues, are deposited into the Successor Agency’s Redevelopment Property Tax Trust Fund (Trust Fund) administered by the City for the benefit of holders of the former Agency’s enforceable obligations. Distributions from the Trust Fund are to be made on the following cycles:
Distribution Dates
Covers Recognized Obligation Payment
Schedules to be Paid
January 2 January 1 through June 30
June 1 July 1 through December 31
N. Effect of New Pronouncements
The City implemented the following GASB Statements during the year:
In June 2017, the GASB issued Statement No. 87, Leases. The objective of this statement is to better meet the information needs of financial statement users by improving accounting and financial reporting for leases by governments. This statement increases the usefulness of governments’ financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract. It establishes a single model for lease accounting based on the foundational principle that leases are financings of the right to use an underlying asset. Under this statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources, thereby enhancing the relevance and consistency of information about governments’ leasing activities. The application of this statement did not have a material impact on the financial statements or footnote disclosures for the City for the fiscal year ended June 30, 2022.
In June 2018, the GASB issued Statement No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period. The objectives of this statement are 1) to enhance the relevance and comparability of information about capital assets and the cost of borrowing for a reporting period, and 2) to simplify accounting for interest cost incurred before the end of a construction period. Implementation of this statement did not have a significant impact on the City’s financial statements for the fiscal year ended June 30, 2022.
In January 2020, the GASB issued Statement No. 92, Omnibus 2020. The objectives of this statement are to enhance comparability in accounting and financial reporting and to improve the consistency of authoritative literature by addressing practice issues that have been identified during implementation and application of certain GASB statements. Implementation of this statement did not have a significant impact on the City’s financial statements for the fiscal year ended June 30, 2022.
9.1.a
Packet Pg. 72
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
40 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) In March 2020, the GASB issued Statement No. 93, Replacement of Interbank Offered Rates. The objective of this statement is to address those and other accounting and financial reporting implications that result from the replacement of an interbank offered rate. Implementation of this statement did not have a significant impact on the City’s financial statements for the fiscal year ended June 30, 2022.
In June 2020, the GASB issued Statement No. 97, Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans – an Amendment of GASB Statements No. 14 and No. 84, and a Supersession of GASB Statement No. 32. The primary objectives of this statement are to (1) increase consistency and comparability related to the reporting of fiduciary component units in circumstances in which a potential component unit does not have a governing board and the primary government performs the duties that a governing board typically would perform; (2) mitigate costs associated with the reporting of certain defined contribution pension plans, defined contribution other postemployment benefit (OPEB) plans, and employee benefit plans other than pension plans or OPEB plans (other employee benefit plans) as fiduciary component units in fiduciary fund financial statements; and (3) enhance the relevance, consistency, and comparability of the accounting and financial reporting for Internal Revenue Code (IRC) Section 457 deferred compensation plans (Section 457 plans) that meet the definition of a pension plan and for benefits provided through those plans. Implementation of this statement did not have a significant impact on the City’s financial statements for the fiscal year ended June 30, 2022.
In April 2022, the GASB issued Statement No. 99, Omnibus 2022. The objectives of this statement are to enhance comparability in accounting and financial reporting and to improve the consistency of authoritative literature by addressing (a) practice issues that been identified during implementation and application of certain GASB Statements and (b) accounting and financial reporting for financial guarantees. The requirements related to the use of LIBOR, accounting for SNAP distributions, disclosures of nonmonetary transactions, pledges of future revenues by pledging governments, clarification of certain provisions in Statement 34, as amended, and terminology updates related to statements 53 and 63 are effective upon issuance. Implementation of these requirements did not have any impact for the City.
The City is currently analyzing its accounting practices to determine the potential impact on the financial statements for the following GASB Statements:
In May 2019, the GASB issued Statement No. 91, Conduit Debt Obligations. The objectives of this statement are to provide a single method of reporting conduit debt obligations by issuers and eliminate diversity in practice associated with 1) commitments extended by issuers, 2) arrangements associated with conduit debt obligations, and 3) related note disclosure. The requirements of this statement are effective for the City’s fiscal year ending June 30, 2023.
In March 2020, the GASB issued Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangements. The objective of this Statement is to improve financial reporting by addressing issues related to public-private and public-public partnership arrangements (PPPs). This statement also provides guidance for accounting and financial reporting for availability payment arrangements (APAs). As defined in this statement, an APA is an arrangement in which a government compensates an operator for services that may include designing, constructing, financing, maintaining, or operating an underlying nonfinancial asset for a period of time in an exchange or exchange-like transaction.
The requirements of this statement are effective for the City’s fiscal year ending June 30, 2023.
9.1.a
Packet Pg. 73
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
41 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) In May 2020, the GASB issued Statement No. 96, Subscription-Based Information Technology Arrangements. This statement provides guidance on the accounting and financial reporting for subscription-based information technology arrangements (SBITAs) for government end users (governments). This statement (1) defines a SBITA; (2) establishes that a SBITA results in a right-to-use subscription asset—an intangible asset—and a corresponding subscription liability; (3) provides the capitalization criteria for outlays other than subscription payments, including implementation costs of a SBITA; and (4) requires note disclosures regarding a SBITA. The requirements of this statement are effective for the City’s fiscal year ending June 30, 2023.
In April 2022, the GASB issued Statement No. 99, Omnibus 2022. The requirements related to leases, public-private partnerships (PPPs), and SBITAs are effective for the City’s fiscal year ending June 30, 2023. The requirements related to financial guarantees and the classification and reporting of derivative instruments within the scope of statement 53 are effective for the City’s fiscal year ending June 30, 2024.
In June 2022, the GASB issued Statement No. 100, Accounting Changes and Error Corrections – An Amendment of GASB Statement No. 62. The primary objective of this statement 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. The requirements of this statement are effective for the City’s fiscal year ending June 30, 2024.
In June 2022, the GASB issued Statement No. 101, Compensated Absences. The objective of this statement is to better meet the information needs of financial statement users by updating the recognition and measurement guidance for compensated absences. That objective is achieved by aligning the recognition and measurement guidance under a unified model and by amending certain previously required disclosures.
The requirements of this statement are effective for the City’s fiscal year ending June 30, 2025.
O. Leases
A lease is defined as a contract that conveys control of the right to use another entity’s nonfinancial asset (the underlying asset) as specified in the contract for a period of time in an exchange or exchange-like transaction. Examples of nonfinancial assets include buildings, land, vehicles, and equipment. The City will record lease liabilities and lease assets for leases with an individual net present value of $100,000 or more.
The City had no leases with an individual net present value of $100,000 or more as of June 30, 2022.
P. 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 certain amounts and disclosures. Accordingly, actual results could differ from those estimates.
9.1.a
Packet Pg. 74
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
42 NOTE 2 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY A. Budgets and Budgetary Accounting
The City adopts a biennial budget on or before June 30 of even-numbered years for each of the ensuing two fiscal years generally for all funds except fiduciary funds. The Low and Moderate Income Housing Asset major governmental fund, as well as Parkland Dedication, Park and Recreation, and CLEEP Grant nonmajor governmental funds, were not budgeted for the year ended June 30, 2022. The operating budget takes the form of a two-year budget, which is adopted in its entirety by the City Council by resolution.
The operating budget is subject to supplemental appropriations throughout its term in order to provide flexibility to meet changing needs and conditions. The City Manager may approve supplemental appropriations up to $100,000 in the General Fund in increments no larger than $25,000. Council may approve additional appropriations throughout the year as well.
The City Manager is also authorized to transfer budgeted amounts between individual departments and funds. Budget transfers between accounts within a department may be approved by the department director.
Budgeted amounts reported in the accompanying basic financial statements include original and final budget amounts. The level of budgetary control (that is, the level at which expenditures cannot exceed the appropriated amount) is established at the fund level. Budgets for governmental funds are adopted on a basis consistent with generally accepted accounting principles.
B. Deficit Fund Balance and Net Position
At June 30, 2022, the Gas Tax 2107.5 Fund has a deficit fund balance of $11,224, the HCD Housing Grant fund had a deficit fund balance of $91,390, and the Computer Technology Replacement Fund had a deficit fund balance of $1,077. These deficits are expected to be cured in year ended June 30, 2023 through receipt of grant funding and transfers from other funds.
The Successor Agency Private-Purpose Trust Fund had a deficit net position of $1,423,461. The deficit is due to the nature of the redevelopment financing in which long-term debt were incurred for redevelopment activities. The deficit is expected to be eliminated with future redevelopment property tax revenues distributed from the Redevelopment Property Tax Trust Fund administered by the County.
C. Excess of Expenditures over Appropriations
The following funds had expenditures in excess of budget due to unanticipated expenditures for the year ended June 30, 2022, which are expected to be covered with existing fund balance and revenues in fiscal year 2023:
Amount
Major governmental funds:
Traffic Mitigation 904 $
Nonmajor governmental funds:
Traffic Safety 101,939 $
Supplemental Law Enforcement Services 44,577
HCD Housing Grant 91,390
Public Education and Governmental Access Capital Grant 48,843 Capital Projects 16,566
9.1.a
Packet Pg. 75
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
43 NOTE 3 – CASH AND INVESTMENTS
The City's dependence on property tax receipts, which are received semi-annually, requires it to maintain significant cash reserves to finance operations during the remainder of the year. The City pools cash from all sources and all funds except for cash and investments held with trustees. The City’s pooled idle funds are invested pursuant to investment policy guidelines adopted by the City Council. The objectives of the policy are to invest funds to the fullest extent possible and to invest in accordance with the provisions of the California Government Code with the priority of safety, liquidity, and return on investment. The policy addresses the safekeeping of securities, types of authorized investment instruments, diversification, maturities, and reporting requirements. The City maintains a cash and investment pool that is available for use by all funds.
Each fund type’s portion of this pool is displayed on the financial statements as “cash and investments – held in City Treasury.” Certain cash and investments are held by trustees in accordance to debt covenants for bond reserves, retirement of long-term debt, or capital projects.
A. Policies
The City invests in individual investments and in investment pools. Individual investments are evidenced by specific identifiable securities instruments, or by an electronic entry registering the owner in the records of the institution issuing the security, called the book entry system. Security instruments owned by the City are held in safekeeping by a third-party custodian acting as agent for the City under the terms of a custody agreement. The City has mitigated its exposure to custodial credit risks for investments at June 30, 2022.
California law requires banks and savings and loan institutions to pledge government securities with a fair value of 110% of the City’s cash on deposit, or first trust deed mortgage notes with a fair value of 150% of the deposit, as collateral for these deposits. Under California law, this collateral is held in a separate investment pool by another institution in the City’s name and places the City ahead of general creditors of the institution.
The City has mitigated its exposure to custodial credit risks for deposits at June 30, 2022.
B. Classification
The City's total cash and investments, at fair value, are presented on the accompanying financial statements in the following allocation:
Primary Private-Purpose Custodial
Government Trust Fund Funds Total
Cash and investments:
Held in City Treasury 41,006,688 $ 2,905,503 $ 301,861 $ 44,214,052 $ Held with trustees 999,755 - - 999,755
Total cash and investments 42,006,443 $ 2,905,503 $ 301,861 $ 45,213,807 $ C. Investments Authorized by the California Government Code and the City's Investment Policy The City's Investment Policy and the California Government Code allow the City to invest in the following provided the credit ratings of the issuers are acceptable to the City and approved percentages and maturities are not exceeded.
9.1.a
Packet Pg. 76
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
44 NOTE 3 – CASH AND INVESTMENTS (Continued)
The table below identifies investments that are authorized under the California Government Code and the City's Investment Policy:
Minimum Maximum Maximum
Maximum Credit Percentage of Investment in
Authorized Investment Type Maturity Quality Portfolio One Issuer U.S. Treasury bills, bonds, and notes 5 years N/A 100% No Limit U.S. Government Agency Securities 5 years N/A 100% No Limit Medium Term Corporate Notes 5 years A or better 30% No Limit Repurchase Agreements 1 year N/A 100% No Limit
Negotiable Certificates of Deposits 5 years N/A 30% No Limit Money Market Mutual Funds 5 years Highest Category 20% 10% State of California Local
Agency Investment Fund (LAIF) N/A N/A Up to $75 million No Limit D. Investments Authorized by Debt Agreements
The City must maintain required amounts of cash and investments with trustees or fiscal agents under the terms of certain debt issues. These funds are unexpended bond proceeds or are pledged reserves to be used if the City fails to meet its obligations under these debt issues. The California Government Code requires these funds to be invested in accordance with City ordinances, bond indentures, or State statutes. The bond indentures contain no limitations for the maximum investment in any one issuer or the maximum percentage of the portfolio that may be invested in any one investment type. The table below identifies the investment types that are authorized for investments held by trustees under the terms of the bond indentures.
Maximum Minimum
Authorized Investment Type Maturity Credit Quality
U.S. Treasury Obligations N/A N/A
U.S. Agency Securities N/A N/A
U.S. Governmental Sponsored Enterprise N/A N/A
State Obligations:
General Obligation N/A A to AA
General Short-term Obligation N/A A to AA
Special Revenue Bonds N/A AA
Municipal Obligations N/A Two Highest Categories
Pre-funded Municipal Obligations N/A AAA
Unsecured Certificates of Deposit 30 days A-1
FDIC insured deposits N/A N/A
Repurchase Agreements 30 days A
Commercial Paper 270 days A-1 to Highest
Bankers Acceptances 360 days A-1
Certificate of Deposit N/A N/A
Collateralized Certificates of Deposit 365 days A-1
Money Market Funds N/A AAAm or AAAm-G
Investment Agreement N/A N/A
Local Agency Investment Fund N/A N/A
9.1.a
Packet Pg. 77
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
45 NOTE 3 – CASH AND INVESTMENTS (Continued)
E. 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. The City generally manages its interest rate risk by holding investments to maturity.
Information about the sensitivity of the fair values of the City's investments (including investments held by trustees) to market interest rate fluctuations is provided by the following table that shows the distribution of the City's investments by maturity or earliest call date:
Less Than 3 to 12 1 to 5
Investment Type 3 Months Months Years Total
Investments Held in City Treasury:
U.S. Treasury Securities - $ 282,326 $ 1,682,172 $ 1,964,498 $ Local Agency Investment Fund * - 33,125,296 - 33,125,296 Money Market Mutual Funds * 18,520 - - 18,520
Medium Term Corporate Securities 64,975 179,984 998,782 1,243,741 U.S. Government Agency Securities 254,922 336,594 1,120,808 1,712,324 Total investments held in City Treasury 338,417 33,924,200 3,801,762 38,064,379 Investments Held with Trustees:
Equity Mutual Funds (Irrevocable Pension Trust) 999,755 - - 999,755 Total investments 1,338,172 $ 33,924,200 $ 3,801,762 $ 39,064,134 Cash and Deposits not subject to Interest Rate Risk:
Petty cash on hand 6,522
Cash in banks 6,143,151
Total cash and investments $ 45,213,807
Maturities in
* Weighted-average of maturity.
LAIF is part of the Pooled Money Investment Account (PMIA). PMIA oversight is provided by the Pooled Money Investment Board (PMIB) and an in-house Investment Committee. PMIB members are the State Treasurer, State Director of Finance, and State Controller. The Local Investment Advisory Board provides oversight for LAIF. The Board consists of five members as designated by statute. The Chairman is the State Treasurer or his designated representative. Two members are qualified by training and experience in the field of investment or finance, and the State Treasurer appoints two members who are treasurers, finance or fiscal officers, or business managers employed by any county, city, or local district or municipal corporation of this state. LAIF determines fair value on its investment portfolio based on market quotations for those securities where market quotations are readily available, and on amortized cost or best estimate for those securities where fair value is not readily available. The balance available for withdrawal by the City is based on the accounting records maintained by the State. At June 30, 2022, PMIA has a total amount of approximately $234.5 billion and of that amount, 98.12% was invested in non-derivative financial products and 1.88% in structured notes and asset-backed securities, while the weighted average maturity of LAIF was 311 days.
F. Credit Risk
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. The City manages credit risk in accordance with the City's Investment Policy.
9.1.a
Packet Pg. 78
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
46 NOTE 3 – CASH AND INVESTMENTS (Continued)
Presented below is the actual rating as of June 30, 2022 for each investment type, including those with trustees, as provided by Moody’s ratings:
Investment Type Ratings Total
Money Market Mutual Funds Aaam 18,520 $
U.S. Government Agency Securities Aaa 1,712,324
Medium Term Corporate Securities Aa1 59,619 $
Aa2 70,413
Aa3 64,975
A1 396,062
A2 470,868
A3 181,804
Total Medium Term Corporate Securities 1,243,741
Total rated 2,974,585
Exempt from credit rating disclosures:
U.S. Treasury Securities Exempt 1,964,498
Not rated:
Local Agency Investment Fund Not rated 33,125,296
Equity Mutual Funds (Irrevocable Trust) 999,755
Total investments 39,064,134 $
G. Concentration of Credit Risk
The City’s investment policy contains certain limitations on the amount that can be invested in any one issuer. No investment type held by the City accounted for more than 5% of total investments held in the City Treasury as of June 30, 2022.
H. 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 fair value of the assets. Level 1 inputs are quoted prices in an active market for identical assets; Level 2 inputs are significant other observable inputs; and Level 3 inputs are significant unobservable inputs. The City does not measure any of its investments using level 3 inputs.
The following is a summary of the fair value measurements of the City as of June 30, 2022:
Investment Type Total Level 2
Investment by fair value levels
U.S. Treasury Securities 1,964,498 $ 1,964,498 $
U.S. Government Agency Securities 1,712,324 1,712,324
Medium Term Corporate Securities 1,243,741 1,243,741
Total investment by fair value levels 4,920,563 4,920,563 $ Investment not subject to fair value levels
Money Market Mutual Funds 18,520
Local Agency Investment Fund 33,125,296
Equity Mutual Funds (Irrevocable Pension Trust) 999,755 Total investment not subject to fair value levels 34,143,571 Total investments 39,064,134 $
Fair Value Measurement Hierachy
9.1.a
Packet Pg. 79
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
47 NOTE 3 – CASH AND INVESTMENTS (Continued)
Securities classified in Level 2 of the fair value hierarchy are valued using prices determined by the use of matrix pricing techniques maintained by the pricing vendors of these securities. Matrix pricing is used to value securities based on the securities’ relationship to benchmark quoted prices.
NOTE 4 – INTERFUND TRANSACTIONS
A. Advances to the Successor Agency
For fiscal years 1985-86 through 1991-92, the former Agency deferred the required 20% set aside of all tax increment received annually on the original Commons Project Area totaling $638,957, which was recorded as advances to the Low and Moderate Income Housing Fund. No interest was charged on the outstanding balance. This advance was transferred from the former Agency to the Successor Agency on February 1, 2012, when all redevelopment agencies in California ceased to exist. At June 30, 2022, the outstanding advance balance was $572,835. This obligation has been included in the FY2022-23 Successor Agency’s Recognized Obligation Payment Schedule (ROPS) and the balance of $572,835 is scheduled to be paid off in FY2022-23.
During fiscal years 2009-10 and 2010-11, the former Agency borrowed $1,906,348 from the Low and Moderate Income Housing Asset Fund for the Supplemental Educational Revenue Augmentation Fund (SERAF) payment. No interest was charged on the outstanding balance. This advance was transferred from the former Agency to the Successor Agency on February 1, 2012, when all redevelopment agencies in California ceased to exist. This obligation was included in the FY2021-22 Successor Agency’s ROPS and was paid off during FY2021-22. At June 30, 2022, the outstanding advance balance was $0.
B. Transfers Between Funds
With Council or City Manager approval, resources may be transferred from one City fund to another. The purpose of the majority of transfers is to support capital projects activities or operating activities of another fund. The following schedule summarized the City’s transfer activities:
Amount
Fund Making Transfers Fund Receiving Transfers Transferred General Fund Gas Tax Fund 993,000 $
Nonmajor Governmental Funds 2,402,502
Measure J Growth Management Fund Gas Tax Fund 1,000,000 American Rescue Plan Act Fund General fund 136,794
American Rescue Plan Act Fund Nonmajor Governmental Funds 741,503 Nonmajor Governmental Funds General Fund 511,500
Gas Tax Fund 150,000
Total interfund transfers 5,935,299 $
D. Current Interfund Balances
Current interfund balances arise in the normal course of business and are expected to be repaid shortly after the end of the fiscal year. At June 30, 2022, the nonmajor Gas Tax 2107.5 special revenue fund and the nonmajor HCD Housing Grant special revenue fund owed the General Fund $11,224 and $91,390, respectively.
9.1.a
Packet Pg. 80
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
48 NOTE 5 – NOTES AND LOANS RECEIVABLE
Low and Moderate Income Housing Asset Fund
A. Owner-Occupied Housing Rehabilitation Loans
The former Agency administered a housing rehabilitation loan program under which very low and lowincome homeowners were eligible to receive loans up to $60,000 to be used to construct improvements on their homes. The loan was transferred from the former Agency to the City’s Low and Moderate Income Housing Asset major governmental fund and the annual operating grant commitment was transferred to the Successor Agency on February 1, 2012, when all redevelopment agencies in California ceased to exist.
These loans bear three to five percent simple interest, have a fifteen-year term, and are secured by deeds of trust. Payments on the loans may be made monthly or may be deferred and paid at the end of the term or transfer of ownership. At June 30, 2022, principal and interest related to these loans totaled to $287,963, of which the City determined the accrued interest of $117,047 to be unavailable.
B. Grayson Creek Apartments
In fulfillment of its obligation to replace low and moderate-income housing destroyed as part of the Pleasant Hill Downtown Project, the former Agency entered into a loan agreement with Bridge Housing Corporation, a non-profit housing developer. The loan was transferred from the former Agency to the City’s Low and Moderate Income Housing Asset major governmental fund and the annual operating grant commitment was transferred to the Successor Agency on February 1, 2012, when all redevelopment agencies in California ceased to exist. The loan bears three percent simple interest and will mature in year 2032. At June 30, 2022, principal and interest related to this loan totaled to $1,457,361 of which the City determined the accrued interest of $452,362 to be unavailable.
C. Rehabilitation Services of Northern California
On October 17, 2016, the City entered into a Predevelopment Loan Agreement with Rehabilitation Services of Northern California for feasibility studies for constructing a new facility to house its current programs as well as provide long-term supportive housing to low-income seniors. The loan bears 3% simple interest for a loan amount not to exceed $236,000. The loan matures at the earliest of following dates: (1) date of loan default, (2) date of borrower’s abandonment of the housing project or sale or transfer of interest, or (3) fifty five years after the loan date. At June 30, 2022, principal and interested related to this loan totaled $237,770 of which $1,770 is accrued interest.
D. Hookston Manor Apartments
On December 8, 1998, the City entered into loan agreement with Hookston Senior Associates for the acquisition and rehabilitation of the Hookston Manor Apartments to provide low income seniors with affordable housing. The loan bears no interest and the loan amount is $500,000. The loan matures at the earliest of following dates: (1) date of loan default by the borrower, (2) the expiration of applicable cure periods under the loan agreement, or (3) January 1, 2053. At June 30, 2022, the outstanding balance of the loan receivable is $500,000 and a full allowance was recorded against the balance as the City determined the balance to be uncollectible.
9.1.a
Packet Pg. 81
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
49 NOTE 5 – NOTES AND LOANS RECEIVABLE (Continued)
Successor Agency
Jack’s Restaurant
One property in the downtown area was vacant and in need of remodeling to improve its marketability and appeal to prospective tenants. A prospective tenant, Marcovici Management Group, LLC expressed interest in opening a casual fine dining restaurant, under the trade name Jack’s Restaurant if certain improvements were made to the property. Under the California Community Redevelopment Law, the former Agency was authorized to make rehabilitation loans for the purpose of financing rehabilitation of commercial buildings and structures within the Redevelopment Project area. The former Agency entered into a Façade Loan Agreement with Marcovici Management Group, LLC for $460,000 in order to make improvements to the property. The loan bears one percent simple interest and had a final maturity date on November 25, 2019.
The loan was transferred from the former Agency to the Successor Agency on February 1, 2012, when all redevelopment agencies in California ceased to exist. $100,000 of the loan was forgiven due to Jack’s Restaurant meeting certain criteria. On June 14, 2017, the City and Jack’s Restaurant entered into a settlement agreement on improvements disputes and the loan was adjusted to $330,000. The maturity date of the promissory note was extended to May 1, 2027. At June 30, 2022, the outstanding balance of the note was $169,104.
NOTE 6 – LAND HELD FOR REDEVELOPMENT
The former Agency purchased parcels of land in order to develop or redevelop blighted properties within the redevelopment areas. Land held for redevelopment in the amount of $191,049 and $86,100 were transferred from the former Agency to the City’s Low and Moderate Income Housing Asset major governmental fund and the Successor Agency, respectively, on February 1, 2012, when all redevelopment agencies in California ceased to exist. There were no additions or sales activities for the year ended June 30, 2022. At June 30, 2022, the land held for redevelopment was $191,049 and $86,100 for the City’s Low and Moderate Income Housing Asset major governmental fund and the Successor Agency, respectively.
9.1.a
Packet Pg. 82
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
50 NOTE 7 – CAPITAL ASSETS
A. Capital Asset Additions and Retirements
A summary of changes in capital assets for the year ended June 30, 2022 is as follows:
Balance, Balance,
June 30, 2021 Additions Retirements Transfers June 30, 2022 Governmental activities
Capital assets, not being depreciated:
Land and improvements 3,406,821 $ - $ - $ - $ 3,406,821 $ Construction in progress 20,803,865 14,481,959 - (6,916,496) 28,369,328 Total capital assets, not being depreciated 24,210,686 14,481,959 - (6,916,496) 31,776,149 Capital assets, being depreciated:
Buildings and improvements 15,108,347 - - - 15,108,347
Equipment and furniture 10,334,651 940,768 (63,542) - 11,211,877 Streets and roads 65,354,374 - - 3,207,397 68,561,771
Curbs and gutters 16,737,612 - - 171,604 16,909,216
Storm drains 8,017,593 - - 2,945,526 10,963,119
Street lights 3,935,483 - - 213,783 4,149,266
Traffic control devices 6,353,512 - - 378,186 6,731,698 Total capital assets, being depreciated 125,841,572 940,768 (63,542) 6,916,496 133,635,294 Less accumulated depreciation for:
Buildings and improvements (9,645,098) (283,660) - - (9,928,758) Equipment and furniture (8,262,614) (663,993) 63,542 - (8,863,065) Streets and roads (32,392,466) (1,236,316) - - (33,628,782) Curbs and gutters (10,011,106) (338,184) - - (10,349,290) Storm drains (6,855,671) (365,072) - - (7,220,743)
Street lights (1,432,628) (138,171) - - (1,570,799)
Traffic control devices (2,698,933) (224,166) - - (2,923,099) Total accumulated depreciation (71, (3,249,562) 298,516) 63,542 - (74,484,536) Total capital assets, being depreciated, net 54,543,056 (2,308,794) - 6,916,496 59,150,758 Governmental activities, capital assets, net 78,753,742 $ 12,173,165 $ - $ - $ 90,926,907 $ Business-type activity
Capital assets, being depreciated:
Water system infrastructure 781,443 $ - $ - $ - $ 781,443 $ Less accumulated depreciation for:
Water system infrastructure (329,235) (12,268) - - (341,503) Total capital assets, being depreciated, net 452,208 (12,268) - - 439,940 Business-type activity, capital assets, net 452,208 $ (12,268) $ - $ - $ 439,940 $ B. Construction in Progress
Project
Expended to
June 30, 2022
New Library Project 27,559,606 $
Gregory Lane Storm Drain Project 655,736
Contra Costa Blvd. Harriet-Viking Project 143,125
Other Construction in Progress 10,861
Total Construction in Progress 28,369,328 $
9.1.a
Packet Pg. 83
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
51 NOTE 7 – CAPITAL ASSETS (Continued)
C. Depreciation Allocation
Depreciation expense was charged to functions and programs based on their usage of the related assets. For the year ended June 30, 2022, depreciation expense was charged to each function or program for governmental and the business-type activities as follows:
Governmental activities
General government 340,175 $
Public safety 522,109
Transportation 2,387,278
Total depreciation expense - governmental activities 3,249,562 $ Business-type activity
Diablo Vista Water 12,268 $
Total depreciation expense - business-type activities 12,268 $ NOTE 8 –LONG-TERM DEBT
A. Composition and Changes
A summary of changes in long-term debt of the City’s governmental activities for the year ended June 30, 2022 is as follows:
Amount
Balance Balance Due Within
June 30, 2021 Retirements June 30, 2022 One Year
2020 Lease Financing Private Placement, New Library
Interest 1.75% per annum, due 6/1/2032 24,840,359 $ (2,066,668) $ 22, $ 2,102,993 773,691 $ A summary of changes in long-term debt of the Successor Agency for the year ended June 30, 2022 is as follows:
Amount
Balance Balance Due Within
June 30, 2021 Retirements June 30, 2022 One Year
Tax Allocation Refunding Bonds, Series 2002 625,000 $ (625,000) $ - $ - $ Special Tax Refunding Bonds,
Subordinated Series 2002 4,220,000 (270,000) 3,950,000 285,000 Total long-term debt - Successor Agency $ (895,000) 4,845,000 $ 3,950,000 $ 285,000 $
9.1.a
Packet Pg. 84
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
52 NOTE 8 –LONG-TERM DEBT (Continued)
B. Summary of Debt Terms
2020 Lease Financing Private Placement, New Library
The City is financing the construction of a new library building, a portion of the Oak Park Monticello Backbone Infrastructure Improvements, and incidental expenses in the amount of $26,396,078 through a lease financing private placement loan with Bank of the West executed on August 1, 2020. The interest rate on the private placement is 1.75% per annum. Payments are to be made semiannually on December 1 and June 1 with final maturity on June 1, 2032. The loan’s debt service payments will be funded with Measure K revenues.
The financing is being provided through a lease/leaseback structure. Under this structure, the City leases real property consisting of City Hall, Police Headquarters Building and Downtown Parking Garage to the Authority in return for a one-time site lease payment equal to the proceeds of the lease that were received on the closing date from Bank of the West. This amount is being used to finance the Project and pay the costs of issuance of the transaction. The Authority is a separate government entity authorized to assist with the financing or refinancing of certain capital public improvements within the City. As of June 30, 2022, total debt service requirements remaining on the Lease Financing are $24,923,718.
Tax Allocation Refunding Bonds Series 2002
On September 18, 2002, the former Agency issued Tax Allocation Refunding Bonds Series 2002 (Series 2002 Bonds) in the amount of $8,860,000 to refund the Tax Allocation Refunding Bonds Series 1991.
Interest was payable semi-annually on September 1 and March 1, and principal was payable each September 1 with final maturity on September 1, 2021.
The outstanding principal of the Series 2002 Bonds were transferred from the former Agency to the Successor Agency on February 1, 2012, when all redevelopment agencies in California ceased to exist.
Redevelopment property tax revenues (i.e. former tax increment) are pledged for the repayment of the Series 2002 Bonds. The redevelopment property tax revenues recognized during the year ended June 30, 2022 were $3,798,667 as against the total debt service payments made by the Successor Agency of $638,281. The bonds were paid off in full on September 1, 2021 and the balance at June 30, 2022 is $0.
Special Tax Refunding Bonds, Subordinated Series 2002
On November 20, 2002, the City assisted the Pleasant Hill Downtown Community Facilities District No. 1 (District) by issuing $7,290,000 of Special Tax Refunding Bonds, Subordinated Series 2002 (Special Tax Series 2002 Bonds) to refund Special Tax Bonds, Series 1998A. Interest ranged from 2.4% to 6.0% and is payable semi-annually on March 1 and September 1, and principal is payable each September 1 with final maturity on September 1, 2032. Property tax revenues allocated to the former Agency are pledged for the repayment of the Special Tax Series 2002 Bonds.
The outstanding principal of the Special Tax Series 2002 Bonds were transferred from the former Agency to the Successor Agency on February 1, 2012, when all redevelopment agencies in California ceased to exist. Total debt service requirements remaining on the Special Tax Series 2002 bonds are $5,031,027 payable through September 1, 2032. The redevelopment property tax revenues recognized during the year ended June 30, 2022 were $3,798,667 as against the total debt service payments paid by the Successor Agency of $458,155.
9.1.a
Packet Pg. 85
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
53 NOTE 8 – LONG-TERM DEBT (Continued)
C. Debt Service Requirements
Annual debt service requirements are shown below for the City’s governmental activities and the Successor Agency:
Governmental Activities:
For the Year
Ending June 30, Principal Interest
2023 2,102,993 $ 389,379 $
2024 2,139,956 352,416
2025 2,177,569 314,803
2026 2,215,843 276,528
2027 2,254,790 237,582
2028-2032 11,882,540 579,319
$ 2,150,027 22,773,691 $
Successor Agency:
For the Year
Ending June 30, Principal Interest
2023 285,000 $ 175,373 $
2024 300,000 161,901
2025 310,000 147,853
2026 325,000 133,228
2027 340,000 117,914
2028-2032 1,945,000 334,510
2033 445,000 10,248
$ 1,081,027 3,950,000 $
Special Tax Series 2002 Bonds
Lease Financing Private Placement - New
Library Loan
D. Events of Default and Acceleration Clauses
Generally, the City and Successor Agency are considered to be in default if the City or Successor Agency fail to pay the principal of and interest on the outstanding long-term debt when become due and payable.
For the Lease Financing Library Loan, if an event of default has occurred and is continuing, the principal of the debt, together with the accrued interest, may be declared due and payable immediately. For the Special Tax Series 2002 Bonds, there are no provision allowing for the acceleration of the debt service payments in the event of default.
9.1.a
Packet Pg. 86
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
54 NOTE 9 – NET POSITION AND FUND BALANCES
Net position is measured on the full accrual basis while fund balances are measured on the modified accrual basis.
A. Net Position
The government-wide, proprietary, and fiduciary fund financial statements utilize a net position presentation. Net position is categorized as follows:
Net Investment in Capital Assets – This category groups all capital assets including, infrastructure, into one component of net position. Accumulated depreciation and outstanding balances of debt and any debt-related deferred outflows and inflows of resources that are attributable to the acquisition, construction or improvement of these assets reduce the balance in this category.
Restricted – This category consists of restricted assets reduced by liabilities and deferred inflows of resources related to those assets. Enabling legislation authorizes the City to assess, levy, charge, or otherwise mandate payment of resources and includes a legally enforceable requirement that those resources be used only for the specific purposes stipulated in the legislation. A legally enforceable enabling legislation restriction is one that a party external to a government—such as citizens, public interest groups, or the judiciary - can compel a government to honor. At June 30, 2022, the government-wide statement of net position reported restricted net position of $13,683,554 in governmental activities, of which $922,718 are restricted by enabling legislation.
Unrestricted – This category represents net position of the City that does not meet the definition of “net investment in capital assets” or “restricted.”
B. Fund Balances
As prescribed by GASB Statement No. 54, governmental funds report fund balance in classifications based primarily on the extent to which the City is bound to honor constraints on the specific purposes for which amounts in the funds can be spent. Fund balances for governmental funds are made up of the following:
Nonspendable Fund Balance – includes amounts that are (a) not in spendable form, or (b) legally or contractually required to be maintained intact. The “not in spendable form” criterion includes items that are not expected to be converted to cash, i.e., prepaid items. There were no funds with nonspendable fund balance as of June 30, 2022.
Restricted Fund Balance – includes amounts that can be spent only for the specific purposes stipulated by external resource providers, constitutionally or through enabling legislation. Restrictions may effectively be changed or lifted only with the consent of resource providers.
Committed Fund Balance – includes amounts that can only be used for the specific purposes determined by a formal action of the City’s highest level of decision-making authority. The City Council is the highest level of decision-making authority for the City that can commit fund balances by adoption of an ordinance.
Commitments may be changed or lifted only by the City Council taking the same formal action that imposed the constraint originally.
9.1.a
Packet Pg. 87
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
55 NOTE 9 – NET POSITION AND FUND BALANCES (Continued)
Assigned Fund Balance – comprises amounts intended to be used by the City for specific purposes that are neither restricted nor committed. Intent is expressed by the City Council or the City Manager to whom the City Council has delegated the authority to assign amounts to be used for specific purposes by adoption of a resolution.
Unassigned Fund Balance – is the residual classification for the General Fund and includes all amounts not contained in the other classifications. Unassigned amounts are technically available for any purpose. Other governmental funds may only report a negative unassigned balance that was created after classification in one of the other four fund balance categories.
In circumstances when an expenditure may be made for which amounts are available in multiple fund balance classifications, fund balance is depleted in the order of restricted, committed, assigned, and unassigned.
The City Council has established reserve policy levels for contingency purposes. At June 30, 2022, $10,000,000 is reported as part of General Fund’s assigned fund balance.
Fund balances for all major and nonmajor governmental funds as of June 30, 2022, were classified as follows:
Measure J Low and Moderate Other
Traffic Growth Income Governmental
General Mitigation Management Gas Tax Housing Asset Funds Total Restricted for:
General government - $ - $ - $ - $ - $ 555,832 $ $ 555,832 Public safety - - - - - 506,578 506,578
Transportation - 176,462 62,376 3,701,623 - 422,194 4,362,655 Community development - - - - 5,172,410 2,477,129 7,649,539 Capital projects - new library & others 4,164,686 - - - - 115,732 4,280,418 Subtotal 4,164,686 176,462 62,376 3,701,623 5, 4,077,465 172,410 17,355,022 Committed to:
Capital projects - - - - - 1,824,678 1,824,678
Assigned to:
Contingency reserve 10,000,000 - - - - - 10, 000,000
Encumbrances - others 509,419 - - - - - 509,419
Capital projects 6,025,779 - - 1,174,631 - 175,000 7,375,410 Subtotal 16,535,198 - - 1,174,631 - 175,000 17,884,829
Unassigned: - 1,398,465 - - - (103,691) 1,294,774
Total 22,098,349 $ 176,462 $ 62,376 $ 4,876,254 $ $ 5,973,452 5,172,410 $ 38,359,303 $ NOTE 10 – EMPLOYEE BENEFITS
A. Sick Leave Conversion Benefits
Employees hired before certain dates (ranging from August 2011 to November 2011) as stated in the applicable Memorandum of Understanding are entitled to a sick leave conversion benefit. Specific terms of the conversion differ for each employee group. In general, when employees with more than 20 years of service retire, they may convert the net present value of their unused sick leave hours to a Retirement Health Savings plan in accordance with the terms of their bargaining group’s Memorandum of Understanding. A scaled down conversion plan exists for employees with a service retirement of 15 to 19 years of City employment for certain bargaining groups. Employees of the Police Officers Association bargaining groups were provided limited reimbursements for medical insurance based on the unused sick leave hours on the employee’s date of retirement. For the year ended June 30, 2022, the City provided medical benefits for 5 retirees from the converted sick leave bank and total benefits expended on a pay-as-you-go basis and amounted to $39,348.
9.1.a
Packet Pg. 88
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
56 NOTE 10 – EMPLOYEE BENEFITS (Continued)
B. Deferred Compensation Plan
City employees may defer a portion of their compensation under a City sponsored Deferred Compensation Plan created in accordance with Internal Revenue Code Section 457. Under this plan, participants are not taxed on the deferred portion of their compensation until it is distributed to them as defined by the plan.
The laws governing deferred compensation plan assets require plan assets to be held by a trust for the exclusive benefit of plan participants and their beneficiaries. Since the assets held under these plans are not the City's property and are not subject to City control, they have been excluded from these financial statements.
The City has a contract with International City Managers' Association (ICMA) to manage and invest the assets of the Deferred Compensation Plan; ICMA pools the assets of the Deferred Compensation Plan with those of other participants and does not make separate investments for employees.
The City's contract with ICMA was amended January 1, 1997 to substitute a separate trust for the City as owner of the assets in the plan, with the City becoming a trustee, but with no power over investment decisions. As a result, the assets in the Deferred Compensation Plan are not subject to claims by creditors of the City and are not reflected in the City's financial statements.
C. CalPERS Safety and Miscellaneous Employees Plans
Plan Description
The City participates in a cost-sharing multiple-employer pension plan that is administered by the CalPERS.
All qualified permanent and probationary employees are eligible to participate in the City’s CalPERS plan.
The City participates in six rate plans within the Miscellaneous and Safety Risk Pools of the CalPERS Public Agency Cost-Sharing Plan as follows:
CalPERS Plan Participants
Miscellaneous Plan All non-sworn employees who began employment between July 1, 1963 and April 15, 2012
Miscellaneous Tier 2 Plan
All non-sworn employees who began employment between April 16, 2012 and December 31, 2012, or on or after January 1, 2013 but were previously members of CalPERS through another agency.
Miscellaneous PEPRA
Plan
All non-sworn employees who began employment on or after January 1, 2013 but were not previously members of CalPERS through another agency.
Safety Plan All sworn employees who began employment between July 1, 1963 and April 15, 2012
Safety Tier 2 Plan
All sworn employees who began employment between April 16, 2012 and December 31, 2012, or on or after January 1, 2013 but were previously members of CalPERS through another agency.
Safety PEPRA Plan All sworn employees who began employment on or after January 1, 2013 but were not previously members of CalPERS through another agency.
9.1.a
Packet Pg. 89
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
57 NOTE 10 – EMPLOYEE BENEFITS (Continued)
CalPERS acts as a common investment and administrative agent for its participating member employers.
Benefit provisions under the Plan are established by State statute and City resolution. CalPERS issues publicly available reports that include a full description of the pension plan regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website at www.calpers.ca.gov.
CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on a final average compensation period of 12 months or 36 months. The cost of living adjustments for the CalPERS plans are applied as specified by the Public Employees’ Retirement Law. The California Public Employees’ Pension Reform Act (PEPRA), which took effect in January 2013, changes the way CalPERS retirement and health benefits are applied, and places compensation limits on members. As such, members who established CalPERS membership on or after January 1, 2013 are known as “PEPRA” members.
The CalPERS provisions and benefits in effect at June 30, 2022 for each rate plan are summarized as follows:
Miscellaneous PEPRA
Miscellaneous Second Miscellaneous
Plan Tier Plan Plan
Hire date Between
July 1, 1963 and
April 15, 2012
Between
April 16, 2012 and
December 31, 2012
On or after
January 1, 2013
Benefit formula 2% @ 55,
2% @ 60 2% @ 60 2% @ 62
Benefit vesting schedule 5 yrs of service 5 yrs of service 5 yrs of service Benefit payments monthly for life monthly for life monthly for life Retirement age 55 - 60 60 62
Required employee contribution rates 7.00% 7.00% 6.75%
Required employer contribution rates 48.26% 9.32% 7.96% Miscellaneous
Safety PEPRA
Safety Second Safety
Plan Tier Plan Plan
Hire date Between
August 1, 1969 and
April 15, 2012
Between
April 16, 2012 and
December 31, 2012
On or after
January 1, 2013
Benefit formula 2% @ 50,
3% @ 50 3% @ 55 2.7% @ 57
Benefit vesting schedule 5 yrs of service 5 yrs of service 5 yrs of service Benefit payments monthly for life monthly for life monthly for life Retirement age 50 55 57
Required employee contribution rates 9.00% 9.00% 13.00% Required employer contribution rates 90.34% 21.18% 13.77% Safety
9.1.a
Packet Pg. 90
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
58 NOTE 10 – EMPLOYEE BENEFITS (Continued)
Contributions
For the year ended June 30, 2022, the City’s contractually required contributions, which are actuarially determined, were as follows:
Miscellaneous - All Plans 2,394,414 $
Safety - All Plans 2,868,714
Total 5,263,128 $
Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. Funding contributions for both Plans are determined annually on an actuarial basis as of June 30 by CalPERS. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees.
In June 2022, the City established a Section 115 irrevocable trust with the Public Agency Retirement Services (PARS). The Trust Account allows more control and flexibility in investment allocations compared to the City’s portfolio which is restricted by State regulations to fixed income instruments. On June 27, 2022, the City made a one-time initial contribution of $1,000,000 into the trust. The City will consider making additional contributions to the Trust based on the net position of the General Fund recommended by the City Manager and Finance Manager. The amount will be based on unassigned General Fund Balance when revenues exceed costs (excluding Measure K funds) in the audited financial statements.
The recommended contribution amount will be based on the higher of 10% or $50,000 of the excess unassigned General Fund Balance. At June 30, 2022, the City reported the account balance of $999,755 as restricted cash and investments with trustees in the General Fund.
Net Pension Liability
At June 30, 2022, the City’s proportionate share of the net pension liability of Miscellaneous Plans and Safety Plans were 0.25036%, or $13,540,137 and 0.28652% or $15,495,674, respectively. The total net pension liability for the City was $29,035,811.
The City’s net pension liability was based on the proportionate shares (in dollars) determined by CalPERS based on individual actuarial measurements specific to each rate plan in the Miscellaneous and the Safety Risk Pools. The City’s total proportionate share of the cost-sharing plan pension amounts is the sum of the pension amounts allocated to each of the City’s Miscellaneous and Safety rate plans. The City’s net pension liability is measured as of June 30, 2021, using annual actuarial valuations as of June 30, 2020 rolled forward to June 30, 2021 using standard update procedures. The City’s proportions of the net pension liability for the Miscellaneous Plans and Safety Plans were actuarially determined as of the valuation dates.
The City’s proportionate share in the percentage of the net pension liability for the Miscellaneous Plans increased by 0.06191% while that for the Safety Plans increased by 0.0614%, from the previous measurement date.
9.1.a
Packet Pg. 91
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
59 NOTE 10 – EMPLOYEE BENEFITS (Continued)
Pension Expense, Deferred Outflows of Resources and Deferred Inflows of Resources For the year ended June 30, 2022, the City recognized pension expense of $10,023,328. At June 30, 2022, the City reported deferred outflows of resources and deferred inflows of resources related to pension from the following sources:
Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contributions subsequent to measurement date 5,263,128 $ - $ Differences between expected and actual experience 4,165,803 - Net differences between projected
and actual earnings on plan investments - 21,042,728
Changes in employer's proportion 797,793 979,327
Difference between the employer's contributions
and the employer's proportionate share of contributions - 1,519,674 $ 23,541,729 10,226,724 $
$5,263,128 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2023.
Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:
For the Year Ending June 30,
Deferred
Outflows/(Inflows)
of Resources
2023 (3,829,139) $
2024 (4,195,439)
2025 (4,749,150)
2026 (5,804,405)
$ (18,578,133)
9.1.a
Packet Pg. 92
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
60 NOTE 10 – EMPLOYEE BENEFITS (Continued)
Actuarial Assumptions
A summary of the actuarial assumptions and methods used to calculate the total pension liability as of June 30, 2021 are as follows:
Valuation date June 30, 2020
Measurement date June 30, 2021
Measurement period July 1, 2020 to June 30, 2021
Actuarial cost method Entry-age normal cost method
Actuarial assumptions:
Discount rate 7.15%
Inflation 2.50%
Payroll growth 2.75%
Salaries increase Varies by entry age and service
Mortality Derived using CalPERS Membership Data for all funds (1) Post Retirement Benefit Increase The lessor of contract COLA or 2.50% until Purchasing Power Protection Allowance Floor on Purchasing Power applies,
2.50% thereafter.
(1) The mortality table used was developed based on CalPERS’ specific data. The probabilities of mortality are based on the 2017 CalPERS Experience Study from 1997 to 2015. Pre-retirement and post-retirement mortality rates includes 15 years of projected mortality improvements using 90% of Scale MP-2016 published by the Society of Actuaries. For more details on the table, refer to the 2017 CalPERS Experience Study available on the CalPERS website.
All other actuarial assumptions used in the June 30, 2020 valuation were based on the 2017 CalPERS Experience Study for the period 1997 to 2015, including updates to salary increase, mortality and retirement rates. Further details of the 2017 CalPERS Experience Study can be found on the CalPERS website under Forms and Publications.
Discount Rate
The discount rate used to measure the total pension liability was 7.15 percent for each Plan. The projection of cash flows used to determine the discount rate assumed that the contributions from plan members will be made at the current member contributions rates and that the 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 long-term expected rate of return on pension 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 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 longterm market return expectations as well as the expected pension fund cash flows. Using historical returns of all the funds’ asset classes, expected compound geometric returns were calculated over the short-term (first 10 years) and the long-term (11+ years) using a building-block approach. Using the expected nominal
9.1.a
Packet Pg. 93
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
61 NOTE 10 – EMPLOYEE BENEFITS (Continued)
returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equal to the single equivalent rate calculated and adjusted to account for assumed administrative expenses.
The rate of return was calculated using the capital market assumptions applied to determine the discount rate and asset allocation. The long-term expected real rate of return by asset class and the target allocation adopted by the CalPERS Board effective on July 1, 2020, are as follows:
New Strategic Real Return Real Return
Asset Class Allocation Years 1 - 10 (a) Years 11+ (b)
Public Equity 50.00% 4.80% 5.98%
Fixed Income 28.00% 1.00% 2.62%
Inflation Assets 0.00% 0.77% 1.81%
Private Equity 8.00% 6.30% 7.23%
Real Assets 13.00% 3.75% 4.93%
Liquidity 1.00% 0.00% -0.92%
(a) An expected inflation of 2.00% used for this period. (b) An expected inflation of 2.92% used for this period On November 17, 2021, the CalPERS Board adopted a new strategic asset allocation. The new asset allocation along with the new capital market assumptions, economic assumptions and administrative expenses assumption support a discount rate of 6.90% (net of investment expenses but without a reduction for administrative expense) for financial reporting purposes. This includes a reduction in the price inflation assumption from 2.50% to 2.30% as recommended in the November 2021 CalPERS Experience Study and Review of Actuarial Assumptions. This study also recommended modifications to retirement rates, termination rates, mortality rates and rates of salary increases that were adopted by the CalPERS Board.
These new assumptions will be reflected in the accounting valuation reports for the June 30, 2022 measurement date.
Sensitivity of the Net Pension Liability to Changes in the Discount Rate The following presents the net pension liability of the City’s proportionate share of the net pension liability of the plan as of the measurement date, calculated using the discount rate of 7.15 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 (6.15 percent) or 1 percentage-point higher (8.15 percent) than the current rate:
-1% (6.15%) Current (7.15%) +1% (8.15%)
Net Pension Liability $ 29,035,811 50,586,495 $ 11,283,950 $ Discount Rate
Pension Plan Fiduciary Net Position
Detailed information about the pension plan’s fiduciary net position is available in the separately issued CalPERS financial reports.
9.1.a
Packet Pg. 94
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
62 NOTE 11 – RISK MANAGEMENT
Municipal Pooling Authority
The City is a member of the Municipal Pooling Authority (MPA), a joint powers agency that provides coverage against the following types of loss risks:
Type of Coverage Deductible Coverage Limits
Liability Program $25,000 $29,000,000
Vehicle Physical Damage $3,000 for police vehicles $250,000 $2,000 for all others
Workers' Compensation No deductible Statuory excess of $50,000,000 All Risk Fire & Property Including Flood $25,000 $800,000,000 Boiler & Machinery $10,000 $100,000,000
Cyber Liability $50,000 $2,000,000
Public Entity Pollution Liability $250,000 $1,000,000
Government Crime Coverage $2,500 $5,000,000
Employment Liability $50,000 $2,000,000
The MPA is governed by the MPA Board consisting of representatives from member municipalities. The MPA Board controls the operations of the MPA, including selection of management and approval of operating budgets, independent of any influence by member municipalities beyond their representation on the MPA Board. The City's premium payments to the MPA are calculated in accordance with formulas established by the MPA. Actual surpluses or losses are shared according to a formula developed from overall loss costs and spread to member entities on a percentage basis after a retrospective rating. Financial statements may be obtained from MPA at 1911 San Miguel Drive, Suite 200, Walnut Creek, CA 94596.
For the year ended June 30, 2022, the City paid MPA net premiums of $1,366,784.
Liability for Uninsured Claims
Municipalities are required to record their liability for uninsured claims and to reflect the current portion of this liability as expenditure in the fund financial statements. The City has insurance coverage for such claims, but it has retained the risk for the deductible or uninsured portion of these claims.
The City's liability for uninsured claims is incurred and expected to be repaid within the next fiscal year and was recorded under accounts payable and accrued liabilities in the General Fund. Settlements have not exceeded insurance coverage in the past five years. Changes in the balances of uninsured claims liabilities during the years ended June 30, 2022 and 2021 are as follows:
2022 2021
Uninsured claims, beginning of year 81,811 $ 26,811 $
Incurred claims and changes in estimate 96,012 130,981
Claim payments (81,586) (75,981)
Uninsured claims, end of year 96,237 $ 81,811 $
9.1.a
Packet Pg. 95
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Notes to Basic Financial Statements
For the Year Ended June 30, 2022
63 NOTE 12 – COMMITMENTS AND CONTINGENCIES
A. Contingent Liabilities
The City is subject to litigation arising in the normal course of business. In the opinion of the City Attorney there is no pending litigation which is likely to have a material adverse effect on the financial position of the City.
The City participates in Federal and State grant programs. These programs are audited by the City's independent accountants in accordance with the provisions of the Federal Single Audit Act as amended in 1996, Uniform Guidance and applicable State requirements. These programs are subject to further examination by the grantors, and the amount, if any, of expenditures which may be disallowed by the granting agencies cannot be determined at this time. The City expects such amounts, if any, to be immaterial.
B. Encumbrances
Under encumbrance accounting, purchase orders, contracts and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation. Encumbrance accounting is employed as an extension of formal budgetary integration in all budgeted funds.
Unencumbered operating appropriations lapse at year-end and may be reappropriated in the following year.
Encumbrances outstanding at year-end are not accounted for as expenditures and liabilities, but as part of fund balance.
As of June 30, 2022, the City had outstanding encumbrances for the following governmental funds by fund balance categories:
Fund Balance
Amount Classification
General Fund 3,029,508 $ * Restricted
General Fund 509,419 Assigned
Traffic Mitigation 8,932 Restricted
Measure J Growth Management 53,174 Restricted
Gas Tax 469,784 Restricted
Gas Tax 166,394 Assigned
Nonmajor Governmental Funds 860,075 Restricted
Nonmajor Governmental Funds 216,892 Committed
Total encumbrances 5,314,178 $
* General fund restricted fund balance relates to encumbrances for construction commitments that remain outstanding as of June 30, 2022 for the New Library construction project.
9.1.a
Packet Pg. 96
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) 64 This page is left intentionally blank.
9.1.a
Packet Pg. 97
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Fiscal year 2021-22 2020-21 2019-20 2018-19 2017-18 2016-17 2015-16 2014-15 Measurement period 2020-21 2019-20 2018-19 2017-18 2016-17 2015-16 2014-15 2013-14 City's proportion of the net pension liability (NPL) 0.53688% 0.41357% 0.42149% 0.41428% 0.40312% 0.40112% 0.39264% 0.39231% City's proportionate share of the NPL 29,035,811 $ 44,998,297 $ 43,189,907 $ 39,921,703 $ 39,978,270 $ 34,709,774 $ 26,950,065 $ 24,412,267 $ City's covered payroll 11,974,531 $ 11,569,693 $ 11,527,431 $ 11,198,394 $ 10,760,992 $ 10,723,402 $ 10,610,000 $ 10,107,834 $ City's proportionate share of the NPL
as a percentage of its covered payroll 242.48% 388.93% 374.67% 356.49% 371.51% 323.68% 254.01% 241.52% Plan's fiduciary net position as a percentage of the
Plan's total pension liability 88.29% 75.10% 75.26% 75.26% 73.31% 74.06% 78.40% 80.43% Note to schedule:
*
Benefit Changes - The figures above do not include any liability impact that may have resulted from plan changes, which occurred after the June 30, 2020 valuation date, as they have minimal cost impact. This applies for voluntary benefit changes as well as any offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes).
Change in assumptions - During measurement period 2014, the discount rate was 7.50%. During measurement period 2015, the discount rate was increased from 7.50 percent to 7.65 percent.
There was no change in assumptions during measurement period 2016. During measurement period 2017, the discount rate was reduced from 7.65 percent to 7.15 percent. During measurement period 2018, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study and Review of Actuarial Assumptions December 2017. There were no changes in assumptions during measurement periods 2019, 2020, or 2021.
Fiscal year ended June 30, 2015 was the first year of implementation of GASB Statement No. 68, therefore only eight years of information is shown.
CITY OF PLEASANT HILL
Required Supplementary Information (Unaudited)
Schedule of the City's Proportionate Share of the Net Pension Liability Last Eight Fiscal Years*
65 9.1.a
Packet Pg. 98
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Fiscal Year Ended 2022 2021 2020 2019 2018 2017 2016 2015 2014 Contractually required contributions
(actuarially determined) (CRC) 5,263,128 $ 4,664,449 $ 4,191,149 $ 3,701,227 $ 3,127,536 $ 2,771,458 $ 2,419,864 $ 1,797,824 $ 1,787,116 $ Contributions in relation to the CRC (5,263,128) (4,664,449) (4,191,149) (3,701,227) (3,127,536) (2,771,458) (2,419,864) (1,797,824) (1,787,116) Contribution deficiency (excess) $ - - $ - $ - $ - $ - $ - $ - $ - $ Covered payroll 12,420,321 $ 11,974,531 $ 11,569,693 $ 11,527,431 $ 11,198,394 $ 10,760,992 $ 10,723,402 $ 10,610,000 $ 10,107,834 $ Contributions as a percentage of
covered payroll 42.38% 38.95% 36.23% 32.11% 27.93% 25.75% 22.57% 16.94% 17.68% ADC for fiscal year June 30, 2022
Actuarial valuation date June 30, 2019
Actuarial cost method Entry-Age Normal Cost Method
Asset valuation method Actuarial value of assets
Inflation 2.50%
Salary increases Varies by entry age and services
Payroll growth 2.75%
Investment rate of return
Retirement age
Mortality
*
CITY OF PLEASANT HILL
Required Supplementary Information (Unaudited)
Schedule of City Contributions
Last Nine Fiscal Years*
7.00%, net of pension plan investment expenses, includes inflation.
The probabilities of retirement are based on the 2017 CalPERS Experience Study for the period 1997 to 2015.
The probabilities of mortality are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. Pre-retirement and Post-retirement mortality rates include 15 years of projected mortality improvement using 90% of Scale MP-2016 published by the Society of Actuaries.
Fiscal year ended June 30, 2015 was the first year of implementation of GASB Statement No. 68, therefore only nine years of information is shown.
The actuarial methods and assumptions used to set the actuarially determined contributions for the fiscal year ended June 30, 2022 were as follows:
66 9.1.a
Packet Pg. 99
Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Other Nonmajor Governmental Funds
Year Ended June 30, 2022
67 All funds not considered as major funds on the Fund Financial Statements are consolidated in one column entitled “Other Governmental Funds.” These nonmajor funds are identified and included in this supplementary section and includes all of the City’s Special Revenue Funds and Capital Project Funds.
SPECIAL REVENUE FUNDS:
The Special Revenue Funds are used to account for the proceeds of specific revenue sources that are restricted, committed or assigned to expenditures for specified purposes other than debt service or capital projects.
Traffic Safety Fund - accounts for fines collected from misdemeanor traffic violations involving a moving vehicle. These funds are used to provide crossing guards at major streets near elementary schools.
Gas Tax 2107.5 Fund - accounts for gas tax apportioned by the State to cities based on population. This fund is used for engineering and administrative costs only.
Unified Street Lighting Fund - accounts for an allocation of property taxes used to provide street lighting.
Parkland Dedication Fund – accounts for Parkland dedication fees paid by developers, which are distributed quarterly to the Pleasant Hill Recreation and Park District for parkland purposes.
Commercial Landscaping and Lighting District 20 Fund - accounts for assessments on commercial property that pay for landscape maintenance, street lighting and sidewalk repair costs within commercial districts.
NPDES Fund - accounts for storm water utility fees assessed to property owners citywide on their property tax bills. The funds are used to pay for the “National Pollution Discharge Elimination System,” mandated by the Federal government to prevent further polluting of streams and bays.
Supplemental Law Enforcement Service Fund - accounts for funds allocated by the State for front-line municipal police services.
Waste Management/Recycling Fund - accounts for activities to implement AB939, which mandates a decrease in the volume of landfill waste, as well as for household hazardous waste programs.
Police Special Services Fund - accounts for asset forfeitures from drug-related convictions. These funds may only be used for drug-related education and enforcement activities.
Park and Recreation Fund - accounts for funds received from the Pleasant Hill Recreation and Park District and from any park-related revenue source. Proceeds will be used for park-related and recreationrelated purposes.
Landscaping and Lighting Assessment District 22 Fund - accounts for assessments received from Grayson Woods and Gallery Walk property owners to pay for landscaping and lighting costs in these developments.
Senior Van Services Fund - accounts for donations and fare revenues, as well as City-paid expenses of operating a van service for transporting non-driving Pleasant Hill seniors to medical and dental appointments in the local area, shopping within Pleasant Hill, and to the Pleasant Hill Senior Center for social activities.
9.1.a
Packet Pg. 100 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Other Nonmajor Governmental Funds
Year Ended June 30, 2022
68 CLEEP (California Law Enforcement Equipment Program) Grant Fund - accounts for State grant funds to be used for law enforcement-related equipment purchases.
Vehicle Abatement Fund - accounts for funds received quarterly from the County of Contra Costa for vehicle abatement (based on the number of vehicles abated), as well as an annual year-end transfer from the General Fund to cover expenses beyond the amount of the County's contribution. On an annual basis, 40% of the Code Enforcement investigator's salary and benefits are charged to this fund to approximate the amount of time spent on vehicle abatement.
Affordable Housing Fund - accounts for fees received from developers in lieu of providing affordable housing in their project, as is otherwise required. The City is developing a plan to use these funds to provide assistance to low-income families and individuals in acquiring housing.
Traffic Congestion Relief Fund – accounts for the funds received from the State as a result of AB 2928 and SB 1662 (Statutes of 2000) and the related expenditures. These funds are to be used for maintenance, rehabilitation, and reconstruction projects for public streets and roads.
Disability Access Fund - accounts for funds collected through $1 fee from business license application and renewal for the purpose of increasing certified access specialist services and facilitate compliance with construction-related disability requirements.
General Plan Fee Fund - accounts for the accumulation of revenue levied on building permits for payment of expenditures related to the City’s General Plan Update and Housing Element Update.
HCD Housing Grant Fund - accounts for housing related activities for the City. The fund supports the update of the City of Pleasant Hill Housing Element Update required by the State of California and also supports the streamlining of the permitting of various types of housing projects throughout the City. These funds are supported by the State of California Department of Housing and Community Development grants.
CAPITAL PROJECTS FUNDS:
Capital Projects Funds account for the financial resources that are restricted or committed to expenditure for capital outlays, including the acquisition or construction of capital facilities and other capital assets.
Capital Outlay Fund - also known as Bedroom Tax Fund. Accounts for acquiring, building, improving or expanding public property and facilities.
Computer Technology Replacement Fund - accounts for scheduled and unscheduled replacement of computer-related technology (such as servers, computer, printers, etc.) for City Hall and the Corporation Yard. A flat amount is transferred from General Fund annually for that purpose.
Public Educational and Governmental Access Capital Grant Fund (PEG) - accounts for PEG grant revenues to be used to fund capital costs associated with acquiring PEG capital equipment Vehicles and Equipment Replacement Fund - accounts for acquiring City vehicles, and communication gear, and is funded by General Fund transfers.
9.1.a
Packet Pg. 101 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Other Nonmajor Governmental Funds
Year Ended June 30, 2022
69 Police Technology Fund - accounts for scheduled and unscheduled replacement of radios, copiers, and computer-related technology (such as servers, computers, printers, etc.) for the Police Department.
Annually, a flat amount is transferred from General Fund for that purpose.
Capital Projects Fund - accounts for making capital improvements and funding large maintenance projects.
9.1.a
Packet Pg. 102 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Combining Balance Sheet
June 30, 2022
Special Revenue Funds
Commercial
Landscaping
Gas Tax Unified Street Parkland and Lighting
Traffic Safety 2107.5 Lighting Dedication District 20 NPDES Assets:
Cash and investments:
Held in City Treasury 16,371 $ - $ $ 570,900 $ 359,370 $ 1, 288,018 $ 367,833 Receivables:
Accounts and other 4 - - - - 111,174
Grants - - - - - -
Interest 26 - 1,106 680 544 1,347
Total assets 16,401 $ - $ $ 572,006 $ 360,050 $ 1, 288,562 $ 480,354 Liabilities and fund balances:
Liabilities:
Accounts payable and accrued liabilities - $ - $ 16,174 $ $ 69,656 360,050 $ 18,529 $ Due to other funds - 11,224 - - - -
Total liabilities - 11,224 16,174 69,656 360,050 18,529 Deferred inflows of resources - unavailable revenue - - - - - - Fund balances:
Restricted 16,401 - - 555,832 1, 218,906 286,825
Committed - - - - - -
Assigned - - - - - 175,000
Unassigned - (11, - 224) - - -
Total fund balances (deficits) 16,401 (11, 224) - 555,832 1, 218,906 461,825 Total liabilities and fund balances 16,401 $ - $ $ 572,006 $ 360,050 $ 1, 288,562 $ 480,354 70 9.1.a
Packet Pg. 103 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Combining Balance Sheet
June 30, 2022
Special Revenue Funds
Supplemental Landscaping
Law Waste and Lighting
Enforcement Management/ Police Special Park and Assessment Senior Van CLEEP Vehicle Services Recycling Services Recreation District 22 Services Grant Abatement $ 318,375 $ 69,506 340,153 $ 2 $ 85,913 $ 17,415 $ 6 $ $ 153,411 - - - - - - - -
- - - - - - - -
642 639 131 - 163 33 - -
$ 319,014 $ 69,637 340,795 $ 2 $ 86,076 $ 17,448 $ 6 $ $ 153,411 $ 5,959 49,291 $ 2,600 $ - $ 1,143 $ - $ - $ - $
- - - - - - - -
5,959 49,291 2,600 - 1,143 - - -
- - - - - - - -
269,723 67,037 334,836 2 84,933 17,448 6 153,411
- - - - - - - -
- - - - - - - -
- - - - - - - -
269,723 67,037 334,836 2 84,933 17,448 6 153,411
$ 319,014 $ 69,637 340,795 $ 2 $ 86,076 $ 17,448 $ 6 $ $ 153,411 (Continued)
71 9.1.a
Packet Pg. 104 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Traffic
Affordable Congestion Disability General HCD Housing
Housing Relief Fund Access Plan Fee Grant
Assets:
Cash and investments:
Held in City Treasury 559,764 $ $ 68,011 118,355 $ $ - 264,746 $ Receivables:
Accounts and other 10,000 - - - -
Grants - - - - 91,390
Interest 1,058 - 127 500 -
Total assets 570,822 $ $ 68,138 118,355 $ $ 91,390 265,246 $ Liabilities and fund balances:
Liabilities:
Accounts payable and accrued liabilities - $ - $ 66,188 $ - $ - $ Due to other funds - - - - 91,390
Total liabilities - - 66,188 - 91,390
Deferred inflows of resources - unavailable revenue - - - - 91,390 Fund balances:
Restricted 570,822 1,950 118,355 - 265,246
Committed - - - - -
Assigned - - - - -
Unassigned - - - - (91, 390)
Total fund balances (deficits) 570,822 1,950 118,355 (91, 265,246 390) Total liabilities and fund balances 570,822 $ $ 68,138 118,355 $ $ - 265,246 $
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Combining Balance Sheet
June 30, 2022
Special Revenue Funds
72 9.1.a
Packet Pg. 105 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Public
Educational and
Computer Governmental Vehicles and
Technology Access Capital Equipment Police
Capital Outlay Replacement Grant Replacement Technology Capital Projects Total $ 25,895 47,966 $ 43,743 $ $ 311,176 $ 885,942 $ 6, 632,006 $ 544,877 - - 23,850 - - - 145,028
- - - - - - 91,390
- 91 82 - - - 7,169
$ 25,895 48,057 $ 67,675 $ $ 311,176 $ 885,942 $ 6, 632,006 $ 788,464 $ 26,972 - $ - $ - $ 4,446 $ - $ $ 621,008
- - - - - - 102,614
26,972 - - - 4,446 - 723,622
- - - - - - 91,390
- 48,057 67,675 - - - 4, 077,465
- - - 311,176 881,496 1, 632,006 824,678
- - - - - - 175,000
(1, - - 077) - - - ( 103,691)
(1, 48,057 67,675 077) 311,176 881,496 5, 632,006 973,452 $ 25,895 48,057 $ 67,675 $ $ 311,176 $ 885,942 $ 6, 632,006 $ 697,074 (Concluded)
Capital Projects Funds
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Combining Balance Sheet
June 30, 2022
73 9.1.a
Packet Pg. 106 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended June 30, 2022
Special Revenue Funds
Commercial
Landscaping
Gas Tax Unified Street Parkland and Lighting
Traffic Safety 2107.5 Lighting Dedication District 20 NPDES Revenues:
Property taxes - $ - $ 676,458 $ - $ - $ - $
Other taxes and special assessments - - - - 415,908 331,249 Intergovernmental 6,000 - - - - -
Charges for services - - - - - -
Fines and forfeitures 38,119 - - - - -
Use of money and property - 171 1,802 - 1,021 3,854
Total revenues 38,290 6,000 678,260 - 416,929 335,103
Expenditures:
Current:
General government - - 244,450 - - -
Public safety - 101,939 - - - -
Transportation 2,794 - - - 548,692 -
Community development - - - - - 142,552
Capital outlay - - - - - 729,386
Total expenditures 101,939 2,794 244,450 - 548,692 871,938 Excess (deficiency) of revenues
over (under) expenditures 3,206 (63,649) 433,810 - (131,763) (536,835) Other financing sources (uses):
Proceeds from sale of capital asset - - - - - -
Transfers in - - - - 97,946 830,736
Transfers out - - (301,500) - - -
Total other financing sources (uses) - - (301,500) - 97,946 830,736 Change in fund balances (63,649) 3,206 132,310 - (33,817) 293,901 Fund balances, beginning of year (14,430) 80,050 423,522 - 252,723 1,167,924 Fund balances, end of year $ 16,401 $ 555,832 (11,224) $ - $ 218,906 $ 1,461,825 $ 74 9.1.a
Packet Pg. 107 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended June 30, 2022
Special Revenue Funds
Supplemental Landscaping
Law Waste and Lighting
Enforcement Management/ Police Special Park and Assessment Senior Van CLEEP Vehicle Services Recycling Services Recreation District 22 Services Grant Abatement $ - - $ - $ - $ - $ - $ - $ - $
- - - - 58,562 - - -
63,069 161,285 1,438 - - - - 8,810
117,400 - - - - 1,813 - 100
- - - - - - - -
1,203 1,337 404 - 313 58 - -
181,672 162,622 1,842 - 58,875 1,871 - 8,910
- - - - - - - -
- 111,064 93,433 - - - - -
- - - - 56,834 - - -
123,955 - - - - 2,520 - 1,535
- - - - - - - -
123,955 111,064 93,433 - 56,834 2,520 - 1,535
57,717 51,558 (91,591) - 2,041 (649) - 7,375
- - - - - - - -
- - - - 8,005 - - -
- (20,000) - - - - - -
- (20,000) - - 8,005 - - -
57,717 31,558 (91,591) - 10,046 (649) - 7,375
277,119 238,165 158,628 2 74,887 18,097 6 146,036
$ 334,836 269,723 $ 67,037 $ 2 $ 84,933 $ 17,448 $ 6 $ 153,411 $ (Continued)
75 9.1.a
Packet Pg. 108 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Traffic
Affordable Congestion Disability General HCD Housing
Housing Relief Fund Access Plan Fee Grant
Revenues:
Property taxes - $ - $ - $ - $ - $
Other taxes and special assessments - - - - -
Intergovernmental 39,410 - - - -
Charges for services - - - 192,377 -
Fines and forfeitures - - - - -
Use of money and property - 2,201 251 1,024 -
Total revenues 2,201 39,410 251 193,401 -
Expenditures:
Current:
General government - - - - -
Public safety - - - - -
Transportation - - - 207,363 -
Community development - - - - 91,390
Capital outlay - - - - -
Total expenditures - - - 207,363 91,390
Excess (deficiency) of revenues
over (under) expenditures 39,410 2,201 251 (13,962) (91,390) Other financing sources (uses):
Proceeds from sale of capital asset - - - - -
Transfers in - - - - -
Transfers out - - - - -
Total other financing sources (uses) - - - - -
Change in fund balances 2,201 39,410 251 (13,962) (91,390) Fund balances, beginning of year 78,945 568,621 1,699 279,208 - Fund balances, end of year $ 118,355 570,822 $ 1,950 $ 265,246 $ $ (91,390)
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended June 30, 2022
Special Revenue Funds
76 9.1.a
Packet Pg. 109 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Public
Educational and
Computer Governmental Vehicles and
Capital Technology Access Capital Equipment Police Capital Outlay Replacement Grant Replacement Technology Projects Total $ - - $ - $ - $ - $ - $ 676,458 $
- 6,810 - - - - 812,529
- - 72,271 - - - 352,283
- - - - - - 311,690
- - - - - - 38,119
- 178 367 - - - 14,184
- 6,988 72,638 - - - 2,205,263
- - - - - - 244,450
- - - - - 15,351 321,787
- - - - - 2,400 818,083
- - - - - - 361,952
685,090 - 53,440 170,859 275,005 235,158 2,148,938
685,090 - 53,440 170,859 275,005 252,909 3,895,210
(685,090) 6,988 19,198 (170,859) (275,005) (252,909) (1,689,947) - - - 19,510 - - 19,510
708,034 - - 151,266 627,270 720,747 3,144,004
- - (340,000) - - - (661,500)
708,034 - (340,000) 170,776 627,270 720,747 2,502,014
22,944 6,988 (320,802) (83) 352,265 467,838 812,067
(24,021) 41,069 388,477 311,259 529,231 164,168 5,161,385 $ 48,057 $ 67,675 (1,077) $ 311,176 $ 881,496 $ 632,006 $ 5,973,452 $ (Concluded)
Capital Projects Funds
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended June 30, 2022
77 9.1.a
Packet Pg. 110 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Year Ended June 30, 2022
Traffic Safety Gas Tax 2107.5
Variance Variance
Final Positive Final Positive
Budget Actual (Negative) Budget Actual (Negative)
Revenues:
Property taxes - $ - $ - $ - $ - $ - $
Other taxes and special assessments - - - - - -
Intergovernmental - - - 6,000 6,000 -
Charges for services - - - - - -
Fines and forfeitures 70,000 38,119 (31,881) - - -
Use of money and property 171 1,268 (1,097) 990 - (990) Other - - - - - -
Total revenues 71,268 38,290 (32,978) 6,990 6,000 (990) Expenditures:
Current:
General government - - - - - -
Public safety - 101,939 (101,939) - - -
Transportation - - - 3,951 2,794 1,157
Community development - - - - - -
Capital outlay - - - - - -
Total expenditures - 101,939 (101,939) 3,951 2,794 1,157 Excess (deficiency) of revenues
over (under) expenditures 71,268 (63,649) (134,917) 3,039 3,206 167 Other financing sources (uses):
Proceeds from sale of capital asset - - - - - -
Transfers in - - - - - -
Transfers out - - - - - -
Total other financing sources (uses) - - - - - -
Change in fund balances 71,268 $ (63,649) (134,917) $ 3,039 $ 3,206 167 $ Fund balances, beginning of year (14,430) 80,050
Fund balances, end of year $ (11,224) 16,401 $
78 9.1.a
Packet Pg. 111 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Year Ended June 30, 2022
Unified Street Lighting NPDES
Variance Variance Variance
Final Positive Final Positive Final Positive
Budget Actual (Negative) Budget Actual (Negative) Budget Actual (Negative) $ 676,458 634,318 $ 42,140 $ - $ - $ - $ - $ - $ - $
- - - 411,899 415,908 4,009 350,000 331,249 (18,751)
- - - - - - - - -
- - - - - - - - -
- - - - - - - - -
1,802 5,290 (3,488) 14,416 1,021 (13,395) 4,518 3,854 (664) - - - - - - - - -
678,260 639,608 38,652 426,315 416,929 (9,386) 354,518 335,103 (19,415) 244,450 269,130 24,680 - - - - - -
- - - - - - - - -
- - - 582,852 548,692 34,160 1,000 - 1,000
- - - - - - 432,916 142,552 290,364
- - - - - - 1,879,195 729,386 1,149,809
244,450 269,130 24,680 582,852 548,692 34,160 2,313,111 871,938 1,441,173 433,810 370,478 63,332 (156,537) (131,763) 24,774 (1,958,593) (536,835) 1,421,758 - - - - - - - - -
- - - 97,946 97,946 - 830,736 830,736 -
(301,500) (301,500) - - - - - - -
(301,500) (301,500) - 97,946 97,946 - 830,736 830,736 - $ 132,310 68,978 63,332 $ (58,591) $ (33,817) 24,774 $ (1,127,857) $ 293,901 1,421,758 $ 252,723 423,522 1,167,924
$ 218,906 555,832 $ 1,461,825 $
(Continued)
Commercial Landscaping and
Lighting District 20
79 9.1.a
Packet Pg. 112 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Supplemental Law
Enforcement Services Management/Recycling
Variance Variance
Final Positive Final Positive
Budget Actual (Negative) Budget Actual (Negative)
Revenues:
Property taxes - $ - $ - $ - $ - $ - $
Other taxes and special assessments - - - - - -
Intergovernmental 161,285 - 161,285 9,921 63,069 53,148 Charges for services - - - 107,359 117,400 10,041
Fines and forfeitures - - - - - -
Use of money and property 1,337 - 1,337 3,056 1,203 (1,853) Other - - - - - -
Total revenues - 162,622 162,622 120,336 181,672 61,336 Expenditures:
Current:
General government - - - - - -
Public safety 66,487 111,064 (44,577) - - -
Transportation - - - - - -
Community development - - - 168,913 123,955 44,958
Capital outlay - - - - - -
Total expenditures 66,487 111,064 (44,577) 168,913 123,955 44,958 Excess (deficiency) of revenues
over (under) expenditures (66,487) 51,558 118,045 (48,577) 57,717 106,294 Other financing sources (uses):
Proceeds from sale of capital asset - - - - - -
Transfers in - - - - - -
Transfers out (20,000) (20,000) - - - -
Total other financing sources (uses) (20,000) (20,000) - - - - Change in fund balances (86,487) $ 31,558 118,045 $ (48,577) $ 57,717 106,294 $ Fund balances, beginning of year 277,119 238,165
Fund balances, end of year $ 334,836 269,723 $
Waste
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Year Ended June 30, 2022
80 9.1.a
Packet Pg. 113 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Police Special Services Senior Van Services
Variance Variance Variance
Final Positive Final Positive Final Positive
Budget Actual (Negative) Budget Actual (Negative) Budget Actual (Negative) $ - - $ - $ - $ - $ - $ - $ - $ - $
- - - 58,562 58,562 - - - -
1,438 8,227 (6,789) - - - - - -
- - - - - - 2,000 1,813 (187)
- - - - - - - - -
404 4,663 (4,259) 653 313 (340) 293 58 (235)
- - - - - - - - -
1,842 12,890 (11,048) 59,215 58,875 (340) 2,293 1,871 (422) - - - - - - - - -
93,433 102,751 9,318 - - - - - -
- - - 71,611 56,834 14,777 - - -
- - - - - - 2,810 2,520 290
- - - - - - - - -
93,433 102,751 9,318 71,611 56,834 14,777 2,810 2,520 290 (91,591) (89,861) (1,730) (12,396) 2,041 14,437 (517) (649) (132) - - - - - - - - -
- - - 8,005 8,005 - - - -
- - - - - - - - -
- - - 8,005 8,005 - - - -
$ (91,591) (89,861) (1,730) $ (4,391) $ 10,046 14,437 $ (517) $ (649) (132) $ 74,887 158,628 18,097
$ 84,933 67,037 $ 17,448 $
(Continued)
Landscaping and Lighting
Assessment District 22
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Year Ended June 30, 2022
81 9.1.a
Packet Pg. 114 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Vehicle Abatement Affordable Housing
Variance Variance
Final Positive Final Positive
Budget Actual (Negative) Budget Actual (Negative)
Revenues:
Property taxes - $ - $ - $ - $ - $ - $
Other taxes and special assessments - - - - - -
Intergovernmental 8,810 19,570 (10,760) - - -
Charges for services - 100 100 - - -
Fines and forfeitures - - - - - -
Use of money and property - - - 8,618 2,201 (6,417)
Other - - - - - -
Total revenues 19,570 8,910 (10,660) 8,618 2,201 (6,417) Expenditures:
Current:
General government - - - - - -
Public safety - - - - - -
Transportation - - - - - -
Community development 1,535 1,545 10 - - -
Capital outlay - - - - - -
Total expenditures 1,545 1,535 10 - - -
Excess (deficiency) of revenues
over (under) expenditures 18,025 7,375 (10,650) 8,618 2,201 (6,417) Other financing sources (uses):
Proceeds from sale of capital asset - - - - - -
Transfers in - - - - - -
Transfers out - - - - - -
Total other financing sources (uses) - - - - - -
Change in fund balances 18,025 $ 7,375 (10,650) $ 8,618 $ 2,201 (6,417) $ Fund balances, beginning of year 568,621 146,036
Fund balances, end of year $ 570,822 153,411 $
For the Year Ended June 30, 2022
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
82 9.1.a
Packet Pg. 115 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Traffic Congestion Relief
Variance Variance Variance
Final Positive Final Positive Final Positive
Budget Actual (Negative) Budget Actual (Negative) Budget Actual (Negative) $ - - $ - $ - $ - $ - $ - $ - $ - $
- - - - - - - - -
39,410 - 39,410 - - - - - -
- - - - - - 138,381 192,377 53,996
- - - - - - - - -
- - - - 251 251 - 1,024 1,024
- - - - - - - - -
39,410 - 39,410 - 251 251 138,381 193,401 55,020
- - - - - - - - -
- - - - - - - - -
- - - - - - 836,266 207,363 628,903
- - - - - - - - -
- - - - - - - - -
- - - - - - 836,266 207,363 628,903
39,410 - 39,410 - 251 251 (697,885) (13,962) 683,923
- - - - - - - - -
- - - - - - - - -
- - - - - - - - -
- - - - - - - - -
$ 39,410 - 39,410 $ - $ 251 251 $ (697,885) $ (13,962) 683,923 $ 1,699 78,945 279,208
$ 1,950 118,355 $ 265,246 $
(Continued)
Disability Access General Plan Fee
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Year Ended June 30, 2022
83 9.1.a
Packet Pg. 116 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) HCD Housing Grant Capital Outlay
Variance Variance
Final Positive Final Positive
Budget Actual (Negative) Budget Actual (Negative)
Revenues:
Property taxes - $ - $ - $ - $ - $ - $
Other taxes and special assessments - - - 4,474 6,810 2,336 Intergovernmental - 80,000 (80,000) - - -
Charges for services - - - - - -
Fines and forfeitures - - - - - -
Use of money and property - - - 1,268 178 (1,090)
Other - - - - - -
Total revenues 80,000 - (80,000) 5,742 6,988 1,246
Expenditures:
Current:
General government - - - - - -
Public safety - - - - - -
Transportation - - - - - -
Community development 91,390 - (91,390) - - -
Capital outlay - - - - - -
Total expenditures - 91,390 (91,390) - - -
Excess (deficiency) of revenues
over (under) expenditures 80,000 (91,390) (171,390) 5,742 6,988 1,246 Other financing sources (uses):
Proceeds from sale of capital asset - - - - - -
Transfers in - - - - - -
Transfers out - - - - - -
Total other financing sources (uses) - - - - - -
Change in fund balances 80,000 $ (91,390) (171,390) $ 5,742 $ 6,988 1,246 $ Fund balances, beginning of year 41,069 -
Fund balances, end of year $ 48,057 (91,390) $
For the Year Ended June 30, 2022
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
84 9.1.a
Packet Pg. 117 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Computer Technology and
Replacement
Variance Variance Variance
Final Positive Final Positive Final Positive
Budget Actual (Negative) Budget Actual (Negative) Budget Actual (Negative) $ - - $ - $ - $ - $ - $ - $ - $ - $
- - - - - - - - -
- - - 60,337 72,271 11,934 - - -
- - - - - - - - -
- - - - - - - - -
- - - 6,088 367 (5,721) - - -
- - - - - - 6,261 - (6,261)
- - - 66,425 72,638 6,213 6,261 - (6,261)
- - - - - - - - -
- - - - - - - - -
- - - - - - - - -
- - - - - - - - -
685,090 853,202 168,112 4,597 53,440 (48,843) 244,667 170,859 73,808 685,090 853,202 168,112 4,597 53,440 (48,843) 244,667 170,859 73,808 (685,090) (853,202) 168,112 61,828 19,198 (42,630) (238,406) (170,859) 67,547 - - - - - - 6,248 19,510 13,262
708,034 418,180 289,854 - - - 151,266 151,266 -
- - - (340,000) (340,000) - - - -
708,034 418,180 289,854 (340,000) (340,000) - 157,514 170,776 13,262 $ 22,944 (435,022) 457,966 $ (278,172) $ (320,802) (42,630) $ (80,892) $ (83) 80,809 $ 388,477 (24,021) 311,259
$ 67,675 (1,077) $ 311,176 $
(Continued)
CITY OF PLEASANT HILL
Replacement
Nonmajor Governmental Funds
Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Year Ended June 30, 2022
Public Educational and
Capital Grant
Governmental Access Vehicles and Equipment
85 9.1.a
Packet Pg. 118 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Police Technology Capital Projects
Variance Variance
Final Positive Final Positive
Budget Actual (Negative) Budget Actual (Negative)
Revenues:
Property taxes - $ - $ - $ - $ - $ - $
Other taxes and special assessments - - - - - -
Intergovernmental - - - - - -
Charges for services - - - - - -
Fines and forfeitures - - - - - -
Use of money and property - - - - - -
Other - - - - - -
Total revenues - - - - - -
Expenditures:
Current:
General government - - - - - -
Public safety - - - 13,990 15,351 (1,361)
Transportation - - - 748 2,400 (1,652)
Community development - - - - - -
Capital outlay 674,425 275,005 399,420 221,605 235,158 (13,553) Total expenditures 674,425 275,005 399,420 236,343 252,909 (16,566) Excess (deficiency) of revenues
over (under) expenditures (674,425) (275,005) 399,420 (236,343) (252,909) (16,566) Other financing sources (uses):
Proceeds from sale of capital asset - - - - - -
Transfers in 627,270 627,270 - 720,747 720,747 -
Transfers out - - - - - -
Total other financing sources (uses) 627,270 627,270 - 720,747 720,747 - Change in fund balances (47,155) $ 352,265 399,420 $ 484,404 $ 467,838 (16,566) $ Fund balances, beginning of year 164,168 529,231
Fund balances, end of year $ 632,006 881,496 $
(Concluded)
CITY OF PLEASANT HILL
Nonmajor Governmental Funds
Schedules of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Year Ended June 30, 2022
86 9.1.a
Packet Pg. 119 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Custodial Funds
Year Ended June 30, 2022
87 Custodial funds are used to account for assets held by the City in a fiduciary capacity on behalf of others.
Specific custodial funds are as follows:
Acme Landfill Closure Fund - accounts for funds collected by Pleasant Hill Bayshore Disposal Company from their Pleasant Hill ratepayers prior to February 8, 1993 and turned over to the City on that date for the purpose of covering future costs of the closure of the Acme Landfill. In addition, from November 1994 through June 1997, savings from the Keller Canyon Landfill rate reduction were deposited into this fund.
Transpac Fund - accounts for contributions from TRANSPAC member agencies in central County of Contra Costa and the use of those funds for transportation planning and information purposes.
TDM Fund - accounts for transportation funds advanced and reimbursed to TRANSPAC for Transportation Demand Management projects in central County of Contra Costa.
Asset Forfeiture Holding Fund - accounts for cash seized in drug cases, the distribution of which is determined later by the court. Distribution is most often among the law enforcement agencies involved in the arrest and investigation. If the City receives a portion, it is transferred to the Police Special Services Fund.
9.1.a
Packet Pg. 120 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Acme Landfill Asset Forfeiture
Closure Transpac TDM Holding Fund Total
Assets:
Cash and investments held in City Treasury 71,135 $ 150,563 $ - $ 80,163 $ 301,861 $ Interest receivable 135 284 - - 419
Total Assets 71,270 150,847 - 80,163 302,280
Liabilities:
Accounts payable and accruals - 70,265 - - 70,265
Net Position:
Restricted for:
Governmental entities and others 71,270 80,582 - 80,163 232,015 Total net position 71,270 $ 80,582 $ - $ 80,163 $ 232,015 $
CITY OF PLEASANT HILL
Custodial Funds
Combining Statement of Fiduciary Net Position
For the Year Ended June 30, 2022
88 9.1.a
Packet Pg. 121 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Acme Landfill Asset Forfeiture
Closure Transpac TDM Holding Fund Total
Additions:
Members contributions - $ 245,496 $ - $ - $ 245,496 $
Investment earnings - 904 - - 904
Others 278 - - 29,703 29,981
Total additions 278 246,400 - 29,703 276,381
Deductions:
Benefits paid to participants or beneficiaries - 39,503 - 11,176 50,679 Administrative and general - 249,851 163 - 250,014
Total deductions - 289,354 163 11,176 300,693
Changes in net position 278 (42,954) (163) 18,527 (24,312) Net position, beginning of year 70,992 123,536 163 61,636 256,327 Net position, end of year 71,270 $ 80,582 $ - $ 80,163 $ 232,015 $
CITY OF PLEASANT HILL
Custodial Funds
Combining Statement of Changes in Fiduciary Net Position For the Year Ended June 30, 2022
89 9.1.a
Packet Pg. 122 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) 90 This page is left intentionally blank.
9.1.a
Packet Pg. 123 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Statistical Section
Year Ended June 30, 2022
91 This part of the City’s Annual Comprehensive Financial Report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City’s overall financial health. In contrast to the financial section, the statistical section information is not subject to independent audit.
Financial Trends
These schedules contain trend information to help the reader understand how the City’s financial performance and well being have changed over time:
1. Net Position by Component
2. Changes in Net Position
3. Fund Balances of Governmental Funds
4. Changes in Fund Balances of Governmental Funds
Revenue Capacity
These schedules contain information to help the reader assess the City’s most significant local revenue source, the property tax:
1. Assessed and Estimated Actual Net Value of Taxable Property
2. Property Tax Rates, All Direct and Overlapping Governments
3. Principal Property Taxpayers
4. Property Tax Levies and Collections
Debt Capacity
These schedules present information to help the reader assess the affordability of the City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future:
1. Ratio of Outstanding Debt by Type
2. Computation of Direct and Overlapping Debt
3. Computation of Legal Bonded Debt Margin
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the environment within which the City’s financial activities take place:
1. Demographic Statistics
2. Top 25 Sales Tax Producers
3. Taxable Sales by Category
Operating Information
These schedules contain service and infrastructure data to help the reader understand how the information in the City’s financial report relates to the services the City provides and the activities it performs:
1. Full-Time Equivalent City Government Employees by Function
2. Operating Indicators by Function/Program
3. Capital Asset Statistics by Function/Program
Sources
Unless otherwise noted, the information in these schedules is derived from the Annual Comprehensive Financial Reports for the relevant year.
9.1.a
Packet Pg. 124 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Net Position by Component
Last Ten Fiscal Years
(accrual basis of accounting)
June 30,
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Governmental activities
Net investment in capital assets 59,197,790 $ 66,029,250 $ 65,099,649 $ 66,114,333 $ 66,589,844 $ 63,663,298 $ 65,031,586 $ 68,718,885 $ 68,319,097 $ 72,317,902 $ Restricted 11,608,039 11,586,938 11,474,912 12,279,862 8,990,013 10,184,878 10,926,436 12,540,185 13,702,342 13,683,554 Unrestricted 10,601,225 12,351,893 (19,918,513) (18,511,367) (20,106,826) (17,751,134) (21,879,791) (24,614,367) (20,353,944) (22,422,928) Total governmental activities net position $ 89,968,081 81,407,054 $ 56,656,048 $ 59,882,828 $ 55,473,031 $ 56,097,042 $ 54,078,231 $ 56,644,703 $ 61,667,495 $ 63,578,528 $ Business-type activities
Net investment in capital assets 449,206 $ 418,115 $ 532,590 $ 524,375 $ 508,158 $ 491,941 $ 479,673 $ 464,476 $ 452,208 $ 439,940 $ Unrestricted 522,825 593,780 530,294 641,480 752,682 481,814 570,177 688,812 711,427 856,748 Total business-type activities net position $ 1,011,895 972,031 $ 1,062,884 $ 1,165,855 $ 1,260,840 $ 973,755 $ 1,049,850 $ 1,153,288 $ 1,163,635 $ 1,296,688 $ Primary government
Net investment in capital assets 59,626,996 $ 66,447,365 $ 65,632,239 $ 66,638,708 $ 67,098,002 $ 64,155,239 $ 65,511,259 $ 69,183,361 $ 68,771,305 $ 72,757,842 $ Restricted 11,608,039 11,586,938 11,474,912 12,279,862 8,990,013 10,184,878 10,926,436 12,540,185 13,702,342 13,683,554 Unrestricted 11,124,050 12,945,673 (19,388,219) (17,869,887) (19,354,144) (17,269,320) (21,309,614) (23,925,555) (19,642,517) (21,566,180) Total primary government net position $ 90,979,976 82,359,085 $ 57,718,932 $ 61,048,683 $ 56,733,871 $ 57,070,797 $ 55,128,081 $ 57,797,991 $ 62,831,130 $ 64,875,216 $ (40,000)
(20,000)
0 20,000
40,000
60,000
80,000
100,000
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Thousands
Primary Government Net Position
Net investment in capital assets Restricted Unrestricted 92 9.1.a
Packet Pg. 125 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Changes in Net Position
Last Ten Fiscal Years
(Accrual Basis of Accounting)
For the Fiscal Year Ended June 30,
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Expenses:
Governmental Activities:
General Government $ 4,486,256 4,235,267 $ 4,800,859 $ 4,586,389 $ 5,701,798 $ 7,804,038 $ 7,507,044 $ 9,741,367 $ 8,432,265 $ 13,230,100 $ Public Safety 8,931,818 9,777,992 8,789,637 10,061,265 11,729,664 11,259,884 12,791,053 14,033,317 12,925,841 13,757,204 Transportation 7,597,694 6,618,300 16,701,264 9,105,613 14,220,552 13,224,055 13,283,195 8,187,274 12,319,001 9,043,753 Community Development 2,550,154 2,898,886 2,450,528 2,927,165 3,206,118 3,010,100 3,015,887 2,333,180 2,360,910 2,735,359 Interest and fiscal charges 223,433 118,921 176,388 120,227 60,991 17,092 - - 540,308 422,838 Total Governmental Activities Expenses 22,809,961 24,628,760 32,918,676 26,800,659 34,919,123 35,315,169 36,597,179 34,295,138 36,578,325 39,189,254 Business-Type Activities:
Water 225,220 240,045 253,159 217,928 244,104 639,196 293,878 277,436 374,555 267,391 Total Primary Government Expenses $ 23,035,181 24,868,805 $ 33,171,835 $ 27,018,587 $ 35,163,227 $ 35,954,365 $ 36,891,057 $ 34,572,574 $ 36,952,880 $ 39,456,645 $ Program Revenues:
Governmental Activities:
Charges for Services:
General Government $ 166,671 471,143 $ 166,381 $ 192,303 $ 211,572 $ 170,460 $ 184,576 $ 193,465 $ 169,873 $ 219,754 $ Public Safety 157,498 155,901 159,012 184,889 138,235 171,815 144,705 168,603 136,890 152,063 Transportation 403,149 663,656 401,395 404,750 689,386 459,815 517,371 443,989 588,604 559,516 Community Development 1,813,011 1,641,652 1,279,317 1,559,622 1,497,427 2,338,500 1,894,162 1,976,711 1,858,417 2,200,779 Operating Grants and Contributions 1,870,975 1,956,723 4,021,630 2,956,236 1,957,507 4,003,002 2,920,746 3,976,194 7,357,717 4,603,393 Capital Grants and Contributions 2,716,363 7,382,654 6,784,859 2,863,421 2,516,719 1,822,233 56,542 398,901 561,295 208,381 Total Governmental Activities Program Revenues 12,054,465 7,344,931 12,812,594 8,161,221 7,010,846 8,965,825 5,718,102 7,157,863 10,672,796 7,943,886 Business-Type Activities:
Charges for Services:
Diablo Vista Water System 134,520 134,520 134,520 134,235 134,235 133,950 133,950 133,950 133,950 133,950 $ 12,188,985 7,479,451 $ 12,947,114 $ 8,295,456 $ 7,145,081 $ 9,099,775 $ 5,852,052 $ 7,291,813 $ 10,806,746 $ 8,077,836 $ Net (Expense)/Revenue
Governmental Activities $ (10,755,496) (17,283,829) $ (20,106,082) $ (18,639,438) $ (27,908,277) $ (26,349,344) $ (30,879,077) $ (27,137,275) $ (25,905,529) $ (31,245,368) $ Business-Type Activities (90,700) (105,525) (118,639) (83,693) (109,869) (505,246) (159,928) (143,486) (240,605) (133,441) Total Primary Government Net Expense $ (10,846,196) (17,389,354) $ (20,224,721) $ (18,723,131) $ (28,018,146) $ (26,854,590) $ (31,039,005) $ (27,280,761) $ (26,146,134) $ (31,378,809) $ Total Primary Government Program Revenues
93 9.1.a
Packet Pg. 126 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Changes in Net Position (continued)
Last Ten Fiscal Years
(Accrual Basis of Accounting)
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Governmental Activities:
Taxes:
Property Taxes 5,342,185 $ 5,706,908 $ 5,975,571 $ 6,231,850 $ 6,619,240 $ 6,986,641 $ 7,257,893 $ 7,817,772 $ 8,298,137 $ 8,714,018 $ Sales Taxes 7,060,791 7,508,399 7,736,714 8,598,230 8,437,462 8,547,152 8,595,458 9,498,892 10,650,037 11,001,808 Measure K Transaction and Use Tax - - - - 913,316 3,934,343 4,419,035 4,182,302 4,885,076 5,344,293 Other Taxes (a) 6,050,845 6,036,889 6,510,044 6,830,548 7,120,733 7,238,645 7,739,278 7,626,265 6,840,111 8,411,477 Investment Earnings 18,997 81,307 137,025 113,924 117,561 168,458 657,998 472,936 190,610 (447,458) Miscellaneous 45,330 92,128 46,688 91,666 290,168 98,116 190,604 105,580 64,350 132,263 Total Governmental Activities 19,316,523 18,627,256 20,406,042 21,866,218 23,498,480 26,973,355 28,860,266 29,703,747 30,928,321 33,156,401 Business-Type Activities:
Property Taxes 137,890 149,214 168,073 184,412 199,345 209,118 222,338 234,529 247,463 263,325 Investment Earnings 1,350 1,482 1,555 2,252 5,509 9,043 13,685 12,395 3,489 3,169 Total Business-Type Activities 150,564 139,372 169,628 186,664 204,854 218,161 236,023 246,924 250,952 266,494 Total Primary Government $ 19,467,087 18,766,628 $ 20,575,670 $ 22,052,882 $ 23,703,334 $ 27,191,516 $ 29,096,289 $ 29,950,671 $ 31,179,273 $ 33,422,895 $ Extraordinary item:
Extraordinary gain from the dissolution of the
Redevelopment Agency - - - - - - - - - -
Change in Net Position
Governmental Activities $ (789,559) 7,871,760 $ 1,766,604 $ 21,866,218 $ 23,498,480 $ 26,973,355 $ 1,722,991 $ 29,703,747 $ 5,022,792 $ 1,911,033 $ Business-Type Activities 31,925 48,672 85,935 186,664 204,854 218,161 92,537 246,924 10,347 133,053 Total Primary Government $ (757,634) 7,920,432 $ 1,852,539 $ 22,052,882 $ 23,703,334 $ 27,191,516 $ 1,815,528 $ 29,950,671 $ 5,033,139 $ 2,044,086 $ (a) Includes franchise, transient occupancy, and other taxes General Revenues and
Other Changes in Net Position
94 9.1.a
Packet Pg. 127 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
General Fund
Nonspendable 6,718 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ Restricted 890,703 890,703 890,703 890,703 890,703 - - - 14,405,714 4,164,686 Assigned 8,373,037 8,088,146 8,138,277 8,244,143 9,079,046 12,403,387 11,923,505 11,829,908 17,254,645 16,535,198 Unassigned 4,286,921 5,087,502 5,031,285 5,175,170 3,386,999 2,955,251 386,350 575,986 1,442,001 1,398,465 Total General Fund $ 14,066,351 13,557,379 $ 14,060,265 $ 14,310,016 $ 13,356,748 $ 15,358,638 $ 12,309,855 $ 12,405,894 $ 33,102,360 $ 22,098,349 $ All Other Governmental Funds
Nonspendable 207,482 $ 124,489 $ 41,496 $ 217,163 $ 128,707 $ 41,750 $ - $ - $ - $ - $ Restricted 9,657,855 9,918,262 10,267,097 10,752,993 8,764,911 9,786,935 10,443,105 11,911,302 11,637,657 13,190,336 Committed 1,483,869 1,349,207 1,167,308 789,585 742,454 1,105,078 773,160 1,022,449 1,004,658 1,824,678 Assigned - - - - - - 676,000 857,771 181,631 1,349,631
Unassigned (223,195) (273,571) (292,053) (349) (2,442,390) (250,125) (122,615) (646) (38,451) (103,691) Total all other governmental funds 11,126,011 $ 11,118,387 $ 11,183,848 $ 11,759,392 $ 7,193,682 $ 10,683,638 $ 11,769,650 $ 13,790,876 $ 12,785,495 $ 16,260,954 $ Notes:
The change in total fund balance for the General Fund and other governmental funds is explained in the Management's Discussion and Analysis section.
June 30,
CITY OF PLEASANT HILL
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
‐
5,000
10,000
15,000
20,000
25,000
30,000
35,000
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Thousands
General Fund
Nonspendable Restricted Assigned Unassigned
95 9.1.a
Packet Pg. 128 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
Fiscal Year Ended June 30,
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Revenues
Taxes 19,171,702 $ 20,020,926 $ 21,004,157 $ 22,430,711 $ 23,702,930 $ 27,678,904 $ 28,803,232 $ 29,894,153 $ 30,053,298 $ 34,653,497 $ Licenses, permits and fees 494,091 583,804 532,040 713,527 672,519 937,122 935,597 992,074 979,185 1,380,049 Intergovernmental revenues 4,744,826 9,688,815 10,994,559 5,845,401 3,432,676 6,929,650 3,023,531 4,432,153 7,913,725 4,816,806 Charges for services 1,107,016 1,250,908 553,551 660,785 931,803 1,221,440 888,450 871,529 936,198 905,192 Fines and forfeitures 138,148 109,892 136,499 161,505 196,481 122,079 112,911 97,347 39,298 47,858 Use of money and property 81,307 18,997 137,025 113,923 117,560 168,458 657,993 472,935 190,610 (447,457) Other 204,705 58,310 32,808 58,241 274,902 79,873 159,503 51,431 39,217 73,042 Total Revenues 25,941,795 31,731,652 33,390,639 29,984,093 29,328,871 37,137,526 34,581,217 36,811,622 40,151,531 41,428,987 Expenditures
Current:
General government 4,195,631 4,184,701 4,519,012 4,562,647 5,345,224 6,913,938 7,150,693 8,143,854 7,983,400 9,393,390 Public safety 9,322,450 8,545,697 8,854,439 9,602,520 10,376,494 9,901,567 11,136,367 11,475,213 11,393,541 12,644,842 Transportation 8,566,692 12,454,552 14,431,482 8,881,519 12,915,352 10,119,727 11,056,926 9,834,764 12,231,771 6,276,410 Community development 2,226,519 2,540,791 2,527,121 2,985,366 3,058,412 2,934,130 2,908,926 2,289,434 2,265,054 2,631,025 Intergovernmental 647,518 - - - - - - - - -
Capital outlay 589,959 946,311 1,325,838 1,472,864 1,425,460 899,411 4,305,349 2,977,497 10,921,175 15,539,289 Debt service:
Principal repayment 660,000 1,458,000 1,499,000 1,550,000 1,668,000 872,000 - - 1,555,719 2,066,668 Interest and fiscal charges 120,425 220,609 179,575 123,524 64,593 18,283 - - 505,864 425,704 Total Expenditures 26,329,194 30,350,661 33,336,467 29,178,440 34,853,535 31,659,056 36,558,261 34,720,762 46,856,524 48,977,328 Excess (deficiency) of revenues over
(under) expenditures (387,399) 1,380,991 54,172 805,653 (5,524,664) 5,478,470 (1,977,044) 2,090,860 (6,704,993) (7,548,341) Other Financing Sources (Uses)
Transfers in 4,785,497 2,930,815 3,243,517 3,271,101 4,315,992 3,912,300 7,184,244 6,237,614 3,046,721 5,935,299 Transfers (out) (4,785,497) (2,930,815) (3,243,517) (3,271,101) (4,315,992) (3,912,300) (7,184,244) (6,237,614) (3,046,721) (5,935,299) Proceeds from issuance of long term debt 4,087,000 - - - - - - 26,396,078 - Proceeds from sale of capital assets 10,940 11,060 5,203 19,642 5,686 13,376 14,273 26,405 - 19,789 Total other financing sources (uses) 4,097,940 11,060 5,203 19,642 5,686 13,376 14,273 26,405 26,396,078 19,789 Extraordinary item:
Extraordinary (loss) from
dissolution of the Redevelopment
Agency (3,960,524) - - - - - - - - -
Net change in fund balances (249,983) $ 1,392,051 $ 59,375 $ 825,295 $ (5,518,978) $ 5,491,846 $ (1,962,771) $ 2,117,265 $ 19,691,085 $ (7,528,552) $ Debt service as a percentage of
noncapital expenditures 3.4% 7.7% 5.9% 7.2% 5.7% 3.0% 0.0% 0.0% 6.7% 8.8% 96 9.1.a
Packet Pg. 129 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Assessed and Estimated Actual
Net Value of Taxable Property
Last Ten Fiscal Years
Real Property Total Real Total
Fiscal Residential Commercial Industrial Secured Unsecured Total Estimated Direct Year Property Property Property Other Property Property Assessed (a) Full Market (a) Tax Rate (b) 2013 $3,404,271,566 $704,915,306 $15,341,949 $53,574,570 $4,178,103,391 $105,936,525 $4,284,039,916 $4,284,039,916 5.66% 2014 3,638,619,711 736,703,106 14,875,080 55,498,231 4,445,696,128 105,093,519 4,550,789,647 4,550,789,647 5.66% 2015 4,046,306,836 760,045,593 13,317,659 77,930,272 4,874,257,873 107,861,285 4,982,119,158 4,982,119,158 5.66% 2016 4,328,068,359 804,447,646 15,245,789 59,799,203 5,207,537,997 110,394,079 5,317,935,076 5,317,935,076 5.66% 2017 4,561,291,596 821,147,666 15,478,279 73,434,814 5,471,352,355 110,532,287 5,581,884,642 5,581,884,642 5.66% 2018 4,809,775,559 883,832,421 15,787,834 61,281,511 5,770,677,325 105,018,890 5,875,696,215 5,875,696,215 5.66% 2019 5,045,097,655 941,272,641 24,799,843 57,874,754 6,069,044,893 103,265,968 6,172,310,861 6,172,310,861 5.66% 2020 5,412,543,931 982,813,017 25,295,829 87,548,623 6,508,201,400 108,631,243 6,616,832,643 6,616,832,643 5.66% 2021 5,692,653,247 1,077,462,192 25,801,736 65,424,606 6,861,341,781 103,580,600 6,964,922,381 6,964,922,381 5.66% 2022 5,979,006,914 1,089,701,150 26,069,032 110,351,306 7,205,128,402 102,552,352 7,307,680,754 7,307,680,754 5.66% Source: Contra Costa County Assessor Combined Tax Rolls-report provided by HdL Companies (a) The State Constitution requires property to be assessed at one hundred percent of the most recent purchase price, plus an increment of no more than two percent annually, plus any local over-rides.
(b) California cities do not set their own direct tax rate. The State Constitution establishes the rate at 1% and allocates a portion of that amount, by an annual calculation, to all the taxing entities within a tax rate area.
Exempt Values are not included in totals.
‐
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Millions
Assessed Value
Unsecured Property Secured Property
97 9.1.a
Packet Pg. 130 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Property Tax Rates (1)
All Direct And Overlapping Governments
Last Ten Fiscal Years
##
Contra Schools and Miscellaneous Total
Fiscal Costa College Special Direct
Year County City (2) Districts Districts Rate
2013 0.1030 0.0566 0.5349 0.3055 1.0000
2014 0.1030 0.0566 0.5349 0.3055 1.0000
2015 0.1030 0.0566 0.5349 0.3055 1.0000
2016 0.1030 0.0566 0.5349 0.3055 1.0000
2017 0.1030 0.0566 0.5349 0.3055 1.0000
2018 0.1030 0.0566 0.5349 0.3055 1.0000
2019 0.1030 0.0566 0.5349 0.3055 1.0000
2020 0.1030 0.0566 0.5349 0.3055 1.0000
2021 0.1030 0.0566 0.5349 0.3055 1.0000
2022 0.1030 0.0566 0.5349 0.3055 1.0000
Source: County Auditor/Controller's Office
(1) Per $1,000 assessed value
(2) The rates shown are not levied rates, but rather "rate-equivalents." The County, in the application of the Tax Equity Allocation (TEA) formula specified by the 1987 amendments to the Trial Court Funding Act, created these rates to accomplish the property tax shift required by the law. See Note (1) on the "Property Values and Tax Levies and Collections" page for a more detailed explanation.
0.0 0.2
0.4 0.6
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Property Tax Rates (per $1000 Assessed Value)
City Contra Costa County Miscellaneous Special District Schools and College Districts 98 9.1.a
Packet Pg. 131 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) Percentage Percentage
of Total City of Total City
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxpayer Value Rank Value Value Rank Value
PH Crescent Drive Investors 112,750,643 $ 1 1.54% n/a n/a n/a IMT Capital IV Pleasant Hill 93,962,801 2 1.29% n/a n/a n/a 235 Camelback LLC 91,807,690 3 1.26% n/a n/a n/a
FW California PH Shopping Center LLC 72,988,721 4 1.00% 58,351,099 2 1.36% WM Villa Montanaro LLC 54,541,173 5 0.75% 46,904,818 3 1.09% Tilden Ellinwood LLC 48,244,690 6 0.66% n/a n/a n/a
Terra Hospitality-SFMSA LLC 45,675,807 7 0.63% n/a n/a n/a MGP X DVC LLC 42,453,283 8 0.58% n/a n/a n/a
Q Van Ness LLC 38,541,188 9 0.53% n/a n/a n/a
Villa Benedict 37,670,508 10 0.52% n/a n/a n/a
Loja Pleasant Hill LLC n/a n/a n/a 79,042,860 1 1.85%
GSG Residl Iron Horse Park n/a n/a n/a 37,856,114 4 0.88% Grupe Real Estate Investors 29 n/a n/a n/a 34,675,114 5 0.81% EQR Watson General Partnership n/a n/a n/a 31,780,767 6 0.74% Grosvenor USA Limited n/a n/a n/a 29,186,675 7 0.68%
Gallup and Whalen Santa Maria n/a n/a n/a 22,033,000 8 0.51% ERP Operating Limited n/a n/a n/a 21,517,923 9 0.50%
HCP Pleasnt LLC n/a n/a n/a 20,337,362 10 0.47%
Total Ten Total 638,636,504 $ 8.74% 381,685,732 $ 8.91% City Total 7,307,680,754 $ 4,284,039,916 $
Source: County Assessor Fiscal Year Combined Tax Rolls.
CITY OF PLEASANT HILL
Principal Property Taxpayers
Current Year and Ten Years Ago
2021-2022 2012-2013
99 9.1.a
Packet Pg. 132 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Property Tax Levies and Collections
Last Ten Fiscal Years (1)
2004
Collections
Total Tax as of the end
Levied and of the Levy Year
Fiscal Year Collected as a % of Levy
2013 5,342,185 $ 100%
2014 5,706,908 100%
2015 5,975,571 100%
2016 6,231,850 100%
2017 6,619,240 100%
2018 6,986,641 100%
2019 7,257,893 100%
2020 7,817,772 100%
2021 8,298,137 100%
2022 8,714,018 100%
Source: City of Pleasant Hill Annual Comprehensive Financial Reports and Contra Costa County Please note the County distributes property taxes to jurisdications under the "alternate method of property tax distribution known as the Teeter Plan Under this plan the County remits 100% of the levied taxes to the City by June 30 of each year. (1) Pleasant Hill was incorporated in 1961 as a "No-Property Tax" city. The citizens wanted a minimum-service city that could be supported by revenues other than property taxes. Annexations over the years brought a minimum amount of annual property tax revenue to the City from Contra Costa County, as required by the annexation process. Beginning in fiscal year 1989-90, and due to State legislation in 1988 which was designed to bring some relief to no/low property tax cities, the County shifted some of its property taxes to Pleasant Hill in exchange for state trial court funding. The shift was designed to be phased in over seven years, starting at 1% and increasing 1% per year for seven years, leveling out at 7%.
Due to later ERAF legislation, the shift was adjusted to level out at 6.09% instead of 7% and will remain there unless the law changes. The annual shift is a result of a formula specified in the law, and is included in the amounts listed here. In addition, the Redevelopment Agency has received property tax increments since 1975 to service debt and, as required by law since 1977, to fund low and moderate housing and rehabilitation; only the amount used for debt service is included here. $1.0
$2.0
$3.0
$4.0
$5.0
$6.0
$7.0
$8.0
$9.0
$10.0
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Millions
Taxes Levied and Collected
Taxes Levied
100
9.1.a
Packet Pg. 133 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Ratio of Outstanding Debt by Type
Last Ten Fiscal Years
Tax 2013 CalPERS Bank of the West Lease
Allocation Refunding Loan Loan for Revenue
Fiscal Year Refunding Bonds with Umpqua Bank Library Project Refunding Total 2013 n/a (a) 4,087,000 $ n/a 2, $ 7, 960,000 $ 047,000
2014 n/a (a) 3,319,000 n/a 2, 5, 270,000 589,000
2015 n/a (a) 2,530,000 n/a 1, 4, 560,000 090,000
2016 n/a (a) 1,715,000 n/a 2, 825,000 540,000
2017 n/a (a) 872,000 n/a - 872,000
2018 n/a (a) - n/a - -
2019 n/a (a) - n/a - -
2020 n/a (a) - n/a - -
2021 n/a (a) - $24,840,359 - 24, 840,359
2022 n/a (a) - 22, - 773,691 22, 773,691
Fiscal Year
Total Primary
Government
Percentage of
Personal Income Per Capita
2013 5,589,000 $ 0.40% 166.18
2014 4,090,000 0.29% 120.75
2015 2,540,000 0.18% 74.89
2016 872,000 0.06% 25.59
2017 n/a n/a n/a
2018 n/a n/a n/a
2019 n/a n/a n/a
2020 n/a n/a n/a
2021 24,840,359 (b) 1.26% 727.75
2022 22,773,691 (b) 1.12% 669.30
Sources: Reported as calendar year provided by HdL Companies report based on the following sources:
Population: California Department of Finance
Unemployment Data: California Employment Development Department (a)
(b)
Income, Age and Education Data: ESRI-Demographic estimates based on the last available Census. Projections are developed by incorporating all of the prior census data released to date. Post census trends in the population are extracted from a variety of date sources. Demographic Data is totaled form Census Block Groups that overlap the City's boundaries.
During fiscal year 20/21, the City entered into loan financing with Bank of the West for the library project.
During fiscal year 11/12, these bonds are transferred to the Successor Agency to the Pleasant Hill Redevelopment Agency upon dissolution of the former Agency.
Governmental Activities-includes General, Redevelopment and Special Assessment Debt (excludes Successor Agency) $‐
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Thousands
Amount of Outstanding Debt
Governmental Activities
101
9.1.a
Packet Pg. 134 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Computation of Direct and Overlapping Debt
June 30, 2022
202-22 Assessed Valuation $ 7,307,680,754
Percentage Amount
Net Applicable Applicable
Debt To City of To City of
OVERLAPPING TAX AND ASSESSMENT DEBT: Outstanding Pleasant Hill (1) Pleasant Hill Bay Area Rapid Transit District $ 0.821% 20,702,090 2,521,570,000 $ East Bay Regional Park District 1.311% 2,419,975 184,590,000 Contra Costa Community College District 568,780,000 3.133% 17,819,877 Mount Diablo Unified School District 425,126,661 15.307% 65,074,138 Mount Diablo Unified School District Community Facilities District No. 1 4,445,000 15.314% 680,707 Pleasant Hill Recreation and Park District 22,750,000 76.529% 17,410,348 TOTAL GROSS DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT $ 124,107,135 3,727,261,661 $ TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT $ 124,107,135 DIRECT AND OVERLAPPING GENERAL FUND DEBT:
Contra Costa County General Fund Obligations 224,500,000 $ 3.122% 7,008,890 $ Mount Diablo Unfiied School District Certificates of Participation 14,040,000 15.307% 2,149,103 Pleasant Hill Recreation and Park District Certificates of Participation 5,346,000 76.529% 4,091,240 Contra Costa County Fire Protection District Pension Obligations 10,900,000 6.746% 735,314 City of Pleasant Hill General Fund Obligation 22,773,691 100.000% 22,773,691 TOTAL OVERLAPPING GENERAL FUND OBLIGATION DEBT $ 36,758,238 277,559,691 $ Less: Contra Costa County self-supported 1,801,180
NET DIRECT AND OVERLAPPING GENERAL FUND DEBT $ 34,957,058 OVERLAPPING TAX INCREMENT DEBT (Successor Agency) 3,970,000 $ 100.000% 3,970,000 $ TOTAL DIRECT DEBT $ 22,773,691
TOTAL GROSS OVERLAPPING DEBT $ 142,061,682
TOTAL NET OVERLAPPING DEBT $ 140,260,502
GROSS COMBINED TOTAL DEBT $ 164,835,373
NET COMBINED TOTAL DEBT $ 163,034,193 (1) Percentage of overlapping agency's assessed valuation located within boundaries of the City.
RATIOS TO 2021-22 ASSESSED VALUATION:
Total Overlapping Tax and Assessment Debt 1.70%
Total Direct Debt ($24,840,359) 0.31%
Gross Combined Total Debt 2.26%
Net Combined Total Debt 2.23%
RATIOS TO REDEVELOPMENT SUCCESSOR AGENCY INCREMENTAL VALUE ($700,518,851):
Total Overlapping Tax Increment Debt 0.57%
Source: California Municipal Statistics, Inc.
Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds and non-bonded capital lease obligations. 102
9.1.a
Packet Pg. 135 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Computation of Legal Bonded Debt Margin
Last Ten Fiscal Years
ASSESSED VALUATION:
Secured property assessed value, net of exempt real property $ 7,307,680,754 BONDED DEBT LIMIT (3.75% OF ASSESSED VALUE) (a) $ 274,038,028 AMOUNT OF DEBT SUBJECT TO LIMIT (b): (22,773,691)
LEGAL BONDED DEBT MARGIN $ 251,264,337
Total net debt
Total Net Debt Legal applicable to the limit
Fiscal Debt Applicable to Debt as a percentage
Year Limit Limit Margin of debt limit
2013 $160,651,497 $2,960,000 $157,691,497 1.88%
2014 170,654,612 2,270,000 168,384,612 1.35%
2015 186,829,468 1,560,000 185,269,468 0.84%
2016 198,597,565 825,000 197,772,565 0.42%
2017 209,320,674 - 209,320,674 0.00%
2018 220,338,608 - 220,338,608 0.00%
2019 231,461,657 - 231,461,657 0.00%
2020 248,131,224 - 248,131,224 0.00%
2021 261,184,589 24,840,359 236,344,230 10.51%
2022 274,038,028 22,773,691 251,264,337 9.06%
NOTE:
(a)
(b)
California Government Code, Section 43605 sets the debt limit at 15%. The Code section was enacted prior to the change in basing assessed value to full market value when it was previously 25% of market value. Thus, the limit shown as 3.75% is onefourth the limit to account for the adjustment of showing assessed valuation at full cash value.
Includes special assessment bonds and all debt supported by general fund revenues, including capital lease obligations, general obligations, street bonds, and refunding lease revenue bonds. Excludes Pleasant Hill Redevelopment Agency tax allocation refunding bonds.
103
9.1.a
Packet Pg. 136 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Demographic Statistics
Last Ten Calendar Years
Calendar
Year
City
Population
Personal Income
(in thousands)
Per Capita
Personal
Income
Unemployment
Rate
Rank in Size
of California
Cities
2012 33,633 1,404,279 $ 41,753 $ 5.7% 225
2013 33,872 1,396,373 41,225 4.9% 225
2014 33,917 1,442,083 42,518 5.1% 225
2015 34,077 1,474,841 43,279 4.2% 225
2016 34,657 1,480,283 42,712 3.7% 224
2017 35,068 1,619,591 46,184 3.0% 225
2018 35,055 1,736,518 49,593 2.8% 225
2019 34,267 1,810,977 52,849 2.7% 225
2020 34,133 1,974,023 57,833 7.5% 225
2021 34,026 2,026,959 59,570 5.2% 225
Source: Reports as of calendar year provided by the HdL Companies 32,500
33,000
33,500
34,000
34,500
35,000
35,500
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
City Population
$‐
$20,000
$40,000
$60,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Per Capita Personal Income
0.0%
2.0%
4.0%
6.0%
8.0%
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Unemployment Rate
104
9.1.a
Packet Pg. 137 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Top 25 Sales Tax Producers
Current Year and Nine Years Ago
* Business in Top 25 of the Sales Tax Producers
Business Name Business Category 2021-22 2012-13
Arco Service Stations x
AT&T Mobility Electronics/Appliance Stores x
Back Forty Texas BBQ Casual Dining x
Bed Bath & Beyond Home Furnishings x x
Best Buy Electronics/Appliance Stores x x
Burlington Family Apparel x
Buskirk Chevron Service Stations x x
Buy Buy Baby Family Apparel x
Carmax Used Automobile Dealer x
Dick's Sporting Goods Sporting Goods/Bike Stores x
Floor & Décor Building Materials x
Friedman's Appliances Electronics/Appliance Stores x x
Harbor Freight Tools Building Materials x x
Hawk Ridge Systems Office Equipment x
Home Goods Home Furnishings x
In N Out Burger Quick-Service Restaurants x x
Jacks Restaurant Casual Dining x x
Kohls Department Stores x x
Lookingpoint Office Equipment x
Marshalls Family Apparel x x
Michaels Arts & Crafts Art/Gift/Novelty Store x
New U Life Drugs/Chemicals x
Nordstrom Rack Department Stores x
Pacific States Petroleum Petroleum Prod/Equipment x
Pleasant Hill Chevron Service Stations x
Ross Family Apparel x x
Safeway Grocery Stores x x
Safeway Fuel Service Stations x x
Staples Office Supplies/Furniture x
Sun Valley Chevron Service Stations x
Sun Valley Shell Service Stations x x
Target Discount Department Stores x x
TJ Maxx Family Apparel x
Total Wine & More Convenience Stores/Liquors x
Toys R Us Speciality Store x
USA Gas Service Stations x
Source: State Board of Equalization, California Department of Taxes and Fees Administration, the HdL Companies. 105
9.1.a
Packet Pg. 138 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR)) 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Apparel Stores 46,443 $ 51,402 $ 52,931 $ 57,028 $ 57,335 $ 53,372 $ 49,873 $ 56,898 $ 37,585 $ 58,351 $ General Merchandise 72,484 79,481 92,507 94,199 93,452 96,134 91,851 83,496 60,526 71,340 Food Stores 29,166 31,117 31,741 30,307 30,301 28,409 28,145 28,801 30,959 29,812 Eating and Drinking Places 95,374 102,044 108,418 118,019 122,786 123,547 126,721 127,459 97,095 123,174 Building Materials 27,532 29,894 28,809 29,659 34,630 36,243 35,637 31,577 33,646 44,168 Auto Dealers and Supplies 8,314 10,492 12,551 14,207 18,909 16,298 14,023 30,884 59,830 93,044 Service Stations 86,488 87,660 83,653 69,702 60,334 68,476 81,146 82,471 51,153 71,761 Other Retail Stores 210,601 221,871 239,409 252,981 252,283 255,579 258,428 263,121 243,043 302,240 All Other Outlets 141,166 152,112 161,136 185,845 194,760 201,247 198,932 273,187 316,118 291,347 Total 717,568 $ 766,073 $ 811,155 $ 851,947 $ 864,790 $ 879,305 $ 884,756 $ 977,894 $ 929,955 $ 1,085,237 $ Sources: State Board of Equalization, California Department of Taxes and Fees Administration, State Contoller's Office, the HdL Companies Note: Due to confidentiality issues, the names of the ten largest revenue payers are not available. The categories presented are intended to provide alternative information regarding the sources of the City's revenue.
CITY OF PLEASANT HILL
Taxable Sales by Category
Last Ten Calendar Years
(Dollars in thousands)
Adjusted for Economic Data
106
9.1.a
Packet Pg. 139 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Full-Time Equivalent City Government Employees by Function Last Ten Fiscal Years
#
Adopted for Fiscal Year Ended June 30,
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Function
General government 16.50 16.75 17.75 16.00 17.00 20.00 17.00 17.00 17.00 18.00 Public safety 55.00 54.00 55.00 56.00 58.00 56.00 57.00 58.00 58.00 59.00 Public works 23.00 23.00 23.00 27.00 24.00 26.00 28.00 25.00 24.00 23.00 Community development 11.00 11.00 11.00 8.00 7.00 7.00 7.00 7.00 6.00 7.00 Total 115.25 117.75 105.50 104.75 106.75 107.00 106.00 109.00 105.00 107.00 Source: City of Pleasant Hill
‐
20.00 40.00
60.00 80.00
100.00
120.00
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
FTE's
Number of Employees
General government Public safety Public works Community development 107
9.1.a
Packet Pg. 140 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Operating Indicators by Function/Program
Last Ten Fiscal Years
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Function/Program
Public safety: (a)
Incident numbers issued 20,700 19,582 20,685 20,054 21,145 21,473 27,185 25,634 22,921 23,035 Traffic citations issued 4,449 3,964 5,626 5,126 5,940 3,176 5,282 912 943 1,047 Violent Crimes 208 195 217 235 221 217 74 97 75 66
Willful homicide - - - - - 1 - - - -
Forcible rape 1 3 2 3 4 6 10 5 1 6
Robbery 40 30 37 44 37 32 42 50 34 18
Aggravated assaults 38 50 48 41 37 27 25 42 59 41
Property Crimes 1,590 1,564 1,854 1,511 1,623 1,536 1,439 1,476 1,220 1,448 Burglary 249 233 211 142 169 143 104 191 119 147
Motor Vehicle theft 165 158 189 198 170 77 86 153 132 143 Public works:
Miles of paved streets 110 110 110 110 110 110 110 110 110 110 Number of street lights 1,966 1,966 1,966 1,966 1,966 1,966 1,966 1,966 1,966 1,966 General Government:
Business Licenses renewals (excludes Out of City) 3,400 2,961 3,011 3,320 3,250 3,400 3,450 3,300 3,495 3,150 Business License Out of City Contractor 2,500 2,523 2,700 2,400 2,100 2,200 2,300 2,100 1,900 2,050 Community Development:
Building permits issued 1,054 1,074 2,217 2,145 1,428 1,564 1,558 1,492 1,784 1,472 Approximate value of building permits 27,497,070 29,054,093 31,562,332 43,311,461 32,110,238 52,602,460 38,848,143 58,981,804 83,578,342 123,776,547 Building inspections conducted 5,863 7,013 7,225 7,453 5,915 5,585 N/A 5,682 5,844 8,148 Source: City of Pleasant Hill
(a) Covers twelve months period November to November.
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9.1.a
Packet Pg. 141 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Capital Asset Statistics by Function/Program
Last Ten Fiscal Years
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Function/Program
Public safety:
Police stations 1 1 1 1 1 1 1 1 1 1
Public works:
Miles of streets 110 110 110 110 110 110 110 110 110 110 Street lights 1,966 1,966 1,966 1,966 1,966 1,966 1,966 1,966 1,966 1,966 Pavement Condition
Index 66 66 66 66 66 68 68 68 70 73
Recreation:
Open space acres 207 207 207 207 207 207 207 207 207 207 Number of parks owned 11 11 11 11 11 11 11 11 11 11
Number of acres 66.2 66.2 66.2 66.2 66.2 66.2 66.2 66.2 66.2 66.2 Fire protection:
Number of stations 2 2 2 2 2 2 2 2 2 2
Source: City of Pleasant Hill
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9.1.a
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9.1.a
Packet Pg. 143 Attachment: City of Pleasant Hill ACFR FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Report to the City Council
For the Year Ended June 30, 2022
9.1.b
Packet Pg. 144 Attachment: City of Pleasant Hill Management Letter FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Report to the City Council
For the Year Ended June 30, 2022
Table of Contents
Page
Transmittal Letter ........................................................................................................................................... i Required Communications ............................................................................................................................ 1 Current Year Recommendations ................................................................................................................... 6 Status of Prior Year Recommendations ........................................................................................................ 6 Summary of Uncorrected Financial Statements Misstatements .................................................................... 7
9.1.b
Packet Pg. 145 Attachment: City of Pleasant Hill Management Letter FY2022 (Annual Comprehensive Financial Report (ACFR)) www.mgocpa.com
Macias Gini & O’Connell LLP
2121 N. California Boulevard, Suite 750
Walnut Creek, CA 94596 i
Honorable Mayor and Members
of the City Council
City of Pleasant Hill, California
We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of City of Pleasant Hill, California (City), as of and for the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements. Professional standards require that we communicate to you the information related to our audit discussed on pages 1 through 4.
In planning and performing our audit of the basic financial statements of the City as of and for the year ended June 30, 2022, 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, we considered the City’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected, on a timely basis. A reasonable possibility exists when the likelihood of an event occurring is either reasonably possible or probable as defined as follows:
Reasonably possible. The chance of the future event or events occurring is more than remote but less than likely.
Probable. The future event or events are likely to occur.
Our consideration of internal control was for the limited purpose described in the second paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
The purpose of this communication, which is an integral part of our audit, is to describe, for management and those charged with governance, the scope of our testing of internal control and the results of that testing. Accordingly, this communication is not intended to be and should not be used for any other purpose. This report is a matter of public record and this does not limit the distribution of this report.
Walnut Creek, California
February 7, 2023
9.1.b
Packet Pg. 146 Attachment: City of Pleasant Hill Management Letter FY2022 (Annual Comprehensive Financial Report (ACFR)) ii
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9.1.b
Packet Pg. 147 Attachment: City of Pleasant Hill Management Letter FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL, CALIFORNIA
Report to the City Council
For the Year Ended June 30, 2022
1 REQUIRED COMMUNICATIONS
We have audited the financial statements of the City as of and for the fiscal year ended June 30, 2022, and have issued our report thereon dated February 7, 2023. Professional standards require that we advise you of the following matters relating to our audit.
Our Responsibility in Relation to the Financial Statement Audit As communicated in our engagement letter dated July 14, 2022, our responsibility, as described by professional standards, is to form and express opinions about whether the financial statements that have been prepared by management with your oversight are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America. Our audit of the financial statements does not relieve you or management of your respective responsibilities.
Our responsibility, as prescribed by professional standards, is to plan and perform our audit to obtain reasonable, rather than absolute, assurance about whether the financial statements are free of material misstatement. An audit of financial statements includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, as part of our audit, we considered the internal control of the City solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control.
We are also responsible for communicating significant matters related to the audit that are, in our professional judgment, relevant to your responsibilities in overseeing the financial reporting process.
However, we are not required to design procedures for the purpose of identifying other matters to communicate to you.
Planned Scope and Timing of the Audit
We conducted our audit consistent with the planned scope we previously communicated to you. The timing of our audit was delayed due to the transition of management in the finance department.
Compliance with All Ethics Requirements Regarding Independence The engagement team, others in our firm, as appropriate, our firm, and our network firms have complied with all relevant ethical requirements regarding independence.
Qualitative Aspects of the City’s Significant Accounting Practices Significant Accounting Policies
Management has the responsibility to select and use appropriate accounting policies. A summary of the significant accounting policies adopted by the City is included in Note 1 to the financial statements. As described in Note 1(N) to the City’s basic financial statements, the City implemented Governmental Accounting Standards Board (GASB) Statement No. 87, Leases; Statement No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period; Statement No. 92, Omnibus 2020; Statement No. 93, Replacement of Interbank Offered Rates; Statement No. 97, Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred
9.1.b
Packet Pg. 148 Attachment: City of Pleasant Hill Management Letter FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL, CALIFORNIA
Report to the City Council
For the Year Ended June 30, 2022
2 REQUIRED COMMUNICATIONS (Continued)
Compensation Plans – an Amendment of GASB Statements No. 14 and No. 84, and a Supersession of GASB Statement No 32; and certain requirements of GASB Statement No. 99, Omnibus 2022. The implementation of these statements did not have a significant impact on the City’s financial statements for the fiscal year ended June 30, 2022.
No matters have come to our attention that would require us, under professional standards, to inform you about (1) the methods used to account for significant unusual transactions and (2) the effect of significant accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus.
Significant Accounting Estimates
Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s current judgments. Those judgments are normally based on knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ markedly from management’s current judgments.
The most sensitive accounting estimates affecting the City’s basic financial statements were:
Fair value of investments. The City’s investments are generally carried at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. All of the City’s investments are measured using level 2 inputs, except for investments in California Local Agency Investment Fund, money market mutual funds, and equity mutual funds which are not subject to fair value hierarchy. Estimated allowance for losses on notes and loans receivable. The allowance for losses on notes and loans receivable was based on management’s estimate regarding the likelihood of collectability. Depreciation estimates for capital assets, including depreciation methods and useful life assigned to depreciable assets. The estimated useful lives of capital assets were determined based on the nature of the capital assets and management’s estimate of the economic life of the assets. Accrual of compensated absences. The accruals of compensated absences are based on accrued eligible hours of vacation and other compensated leave for eligible employees. Net pension liabilities, contributions, expenses, and other related balances. These balances are based on actuarial valuations performed by the California Public Employees’ Retirement System’s independent actuaries.
Claims loss reserve. The City is exposed to a variety of risks of loss due to general liability, workers’ compensation and other claims, and records an estimate of these losses based on actuarial studies performed by third-party actuaries. These studies are prepared based on the City’s prior claims history, which is used as a basis for extrapolating losses for known and incurred but not reported claims. Actual loss experience may vary from these estimates.
9.1.b
Packet Pg. 149 Attachment: City of Pleasant Hill Management Letter FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL, CALIFORNIA
Report to the City Council
For the Year Ended June 30, 2022
3 REQUIRED COMMUNICATIONS (Continued)
We evaluated the key factors and assumptions used to develop the accounting estimates described above and determined that it is reasonable in relation to the basic financial statements taken as a whole and in relation to the applicable opinion units.
Financial Statement Disclosures
Certain financial statement disclosures involve significant judgment and are particularly sensitive because of their significance to financial statement users. The most sensitive disclosures affecting the financial statements were the disclosures of the Employee Benefits in Note 10 and Risk Management in Note 11.
Significant Difficulties Encountered during the Audit
We encountered no significant difficulties in dealing with management relating to the performance of the audit.
Corrected and Uncorrected Misstatements
For purposes of this communication, professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that we believe are trivial, and communicate them to the appropriate level of management. Further, professional standards require us to also communicate the effect of uncorrected misstatements related to prior periods on the relevant classes of transactions, account balances or disclosures, and the financial statements as a whole and each applicable opinion unit. The accompanying Summary of Uncorrected Financial Statements Misstatements summarizes uncorrected financial statements misstatements whose effects in the current and prior periods, as determined by management, are immaterial, both individual and in the aggregate, to the financial statements taken as a whole and each applicable opinion unit. Uncorrected misstatements or matters underlying those uncorrected misstatements could potentially cause future-period financial statements to be materially misstated, even though the uncorrected misstatements are immaterial to the financial statements currently under audit.
In addition, professional standards require us to communicate to you all material, corrected misstatements that were brought to the attention of management as a result of our audit procedures. None of the misstatements identified by us as a result of our audit procedures and corrected by management were material, either individually or in the aggregate, to the financial statements as a whole and each applicable opinion unit.
Disagreements with Management
For purposes of this letter, professional standards define a disagreement with management as a matter, whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter, which could be significant to the City’s financial statements or the auditor’s report. No such disagreements arose during the course of the audit.
Representations Requested from Management
We have requested certain written representations from management, which are included in the letter dated February 7, 2023.
9.1.b
Packet Pg. 150 Attachment: City of Pleasant Hill Management Letter FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL, CALIFORNIA
Report to the City Council
For the Year Ended June 30, 2022
4 REQUIRED COMMUNICATIONS (Continued)
Management’s Consultations with Other Accountants
In some cases, management may decide to consult with other accountants about auditing and accounting matters. Management informed us that, and to our knowledge, there were no consultations with other accountants regarding auditing and accounting matters.
Other Significant Matters, Findings, or Issues
In the normal course of our professional association with the City, we generally discuss a variety of matters, including the application of accounting principles and auditing standards, operating and regulatory conditions affecting the entity, and operational plans and strategies that may affect the risks of material misstatement. None of the matters discussed resulted in a condition to our retention as the City’s auditors.
Other Information Included in Annual Comprehensive Financial Report Pursuant to professional standards, our responsibility as auditors for other information in documents containing the City’s audited financial statements does not extend beyond the financial information identified in the audit report, and we are not required to perform any procedures to corroborate such other information. However, in accordance with such standards:
Required Supplementary Information
We have applied certain limited procedures to the management’s discussion and analysis, and the schedules related to the pension plans, which are required supplementary information (RSI) that supplements the basic financial statements. Our procedures 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
We were engaged to report on the combining and individual fund financial statements and schedules, which accompany the financial statements but are not RSI. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic 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.
9.1.b
Packet Pg. 151 Attachment: City of Pleasant Hill Management Letter FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL, CALIFORNIA
Report to the City Council
For the Year Ended June 30, 2022
5 Other Information
We were not engaged to report on the introductory and statistical sections, which accompany the financial statements but are not RSI or supplementary information. 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.
Our responsibility also includes communicating to you any information which we believe is a material misstatement of fact. Nothing came to our attention that caused us to believe that such information, or its manner of presentation, is materially inconsistent with the information, or manner of its presentation, appearing in the financial statements.
9.1.b
Packet Pg. 152 Attachment: City of Pleasant Hill Management Letter FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Report to the City Council
For the Year Ended June 30, 2022
6 CURRENT YEAR RECOMMENDATIONS
None noted.
STATUS OF PRIOR YEAR RECOMMENDATIONS
Item 2021-001 Significant Deficiency
Improve Internal Controls over Capital Asset Accounting During our prior year audit, MGO observed that the City retired significant balances in their capital assets, construction-in-progress (CIP) account. The purpose of the CIP account is to accumulate costs that the City incurs in the progress of constructing capital assets. Therefore, the City should only include costs that will be capitalized at the completion of a capital project. In FY2020-21, the City identified within the CIP account significant transportation costs incurred during prior years that were not ultimately capitalized as road improvements within capital assets, such as infrastructure. Therefore, the CIP and net position balances were overstated in prior year, as these costs should have resulted in the recognition of repairs and maintenance type expenses in the period incurred, rather than capitalized as part of CIP.
It was recommended the City re-evaluate its capital asset policies and procedures and develop adequate internal controls over the identification of costs that meet the definition of capital outlay and that should be included in the capital asset financial reporting process. It was recommended that the City should conduct regular reviews of the CIP account to ensure costs within CIP are capitalizable in nature. It was recommended that the City should communicate the policies and procedures to department staff, such as the engineering division, who oversee the CIP projects in order to assist them in better understanding the expectations of management for financial reporting purposes. It was also recommended that the City should monitor the effect of these changes to ensure that the policies and procedures are designed appropriately and are operating effectively.
Status
Corrective action plan has been implemented.
9.1.b
Packet Pg. 153 Attachment: City of Pleasant Hill Management Letter FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY OF PLEASANT HILL
Report to the City Council
For the Year Ended June 30, 2022
7 SUMMARY OF UNCORRECTED FINANCIAL STATEMENTS MISSTATEMENTS Number Accounts/Adjustment Descriptions Debit Credit
#1 Loans Receivable $ 20,292
Interest Revenue $ 20,292
(Successor Agency Private Purpose Trust Fund - to record the impact of accruing interest on loans receivable)
#2 Loans Receivable 38,940
Interest Revenue 38,940
#3 Expenditures 27,938
Accounts Payable 27,938
(General Plan Fee Fund / Governmental Activities - to record expenditures incurred as of June 30, 2022)
(Low and Moderate Income Housing Asset Fund / Governmental Activities - to record the impact of accruing interest on loans receivable)
9.1.b
Packet Pg. 154 Attachment: City of Pleasant Hill Management Letter FY2022 (Annual Comprehensive Financial Report (ACFR))
CITY COUNCIL STAFF REPORT
Meeting Date: February 27, 2023
TO: THE HONORABLE MAYOR AND CITY COUNCILMEMBERS
SUBJECT: ADOPT RESOLUTION NO. ___-23 APPROVING THE APPROPRIATION
OF MEASURE K FUNDS TO FUND THE RESURFACING OF
RESIDENTIAL ZONE 17 AS PART OF THE 2022 STREET
RESURFACING PROJECT NO. PSC-01-22 AND AUTHORIZING THE
MAINTENANCE SUPERINTENDENT TO EXECUTE A CHANGE
ORDER WITH MCK SERVICES, INC.
SYNOPSIS
The Budget Committee received the audited annual Measure K Fund report for fiscal year 2021/2022 (FY 21/22). The Measure K Fund has approximately $10.2 million in total fund balance with $6.0 million that is unassigned. The unassigned fund balance could be used towards a reserve and projects that are currently unfunded and/or have insufficient funding to complete.
The 2022 Street Resurfacing Project No. PSC-01-22 provides for a pavement surface treatment on selected streets within the City. The purpose of this item is to consider the appropriation of available Measure K Funds to fund the inclusion of Residential Zone 17 in the project scope and to seek authorization to execute a construction change order with MCK Services, Inc. for the work. The Budget Committee reviewed staff’s proposal at its meeting of February 22, 2023 and approved forwarding a recommendation to the City Council to approve the funding for the project as proposed.
DISCUSSION
Background
Pleasant Hill voters adopted Measure K, a one-half cent transactions and use tax in November 2016. The tax became effective on April 1, 2017 and will sunset on March 31, 2037 unless extended by Pleasant Hill voters. At the time, annual revenues to the City were estimated at $4.0 million.
During 2020, the City was dealing with the health and financial impacts of the Coronavirus (COVID-19) pandemic. The assumption at the beginning of COVID 19 was that sales tax revenues would decline significantly. This was based on reduced sales since health officials’ guidance was to shelter at home and only purchase essential (i.e. food and medicine) goods. The
9.3 Packet Pg. 155
City Council was aware of this concern and reduced Measure K spending except for the costs related to the new library.
COVID-19 did cause disruptions to the economy but sales tax revenues was an exception as consumers continued to purchase essential and non-essential goods online during this time. The City has seen historical highs for sales tax revenues over the last couple of years including in the Measure K Fund. The City budgeted $3.8 million and $4.0 million and received $4.9 million and $5.3 million in sales tax revenue for FY 20/21 and FY 21/22, respectively.
This has resulted in the Measure K Fund having a fund balance of $10.2 million in FY 21/22, with $4.2 million restricted for debt proceeds for the library and $6.0 million that is unassigned. The Budget Committee, at its November 30, 2022 meeting, directed staff to utilize a portion of the unassigned fund balance for Measure K approved projects that are currently unfunded and/or not fully funded to complete.
On September 12, 2022, the City Council, under Resolution No, 81-22, awarded the 2022 Street Resurfacing Project No. PSC-01-22 to MCK Services in the base bid amount (including contingency) of $4,587,305. Construction began in October 2022, and to date this project has resurfaced two collector streets (Chilpancingo Parkway, and Grayson Road (Heritage Hills Drive to Reliz Valley Road)), utilizing 3,822 tons of new asphalt concrete. Construction stopped early in December 2022, due to inclement weather, and will restart early March 2023. Remaining project work includes the resurfacing of 41 residential streets in Poet’s Corner (RZ7 and RZ20).
Analysis
The contract documents originally identified 13,500 tons of Hot Mix Asphalt (HMA) to be constructed on two collector streets and 41 residential streets in the Poet’s Corner neighborhood as part of the contract. Given the increase in revenues from Measure K, it is appropriate to amend the project scope of the contract to include additional street resurfacing.
Residential Zone 17 was previously identified for a street resurfacing treatment in the City’s Five Year Street Resurfacing Program. Based on field data collected, staff has determined that RZ17 is a suitable candidate for the HMA treatment identified in the 2022 Street Resurfacing project specifications. Staff has coordinated with East Bay Municipal Utility District (EBMUD) and the Central Contra Costa Sanitary District (CCCSD) and confirmed that the potential resurfacing in this neighborhood does not conflict with any upcoming utility infrastructure projects.
The Engineer’s Estimate for this work is $1,100,000. Staff is recommending an appropriation of $1,100,000 from available Measure K funds to the Street Resurfacing Fund and that MCK Services, Inc. be issued a change order for the work, with all bid items being paid at the contract unit price for the 2022 Street Resurfacing Project. Additional work will include utility adjustments and thermoplastic restriping of project streets. By combining the resurfacing treatment of RZ17 with this project, staff believes that better economy of scale pricing will be obtained at a cost savings to the City. Staff has confirmed with MCK Services that they are available to perform the work as part of the 2022 Street Resurfacing Project.
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Staff has confirmed with the City Attorney’s office that the resurfacing of RZ17 may be added to the 2022 Street Resurfacing Project No. PSC-01-22 by change order, as the scope of work is not a material change to the contract.
The Budget Committee has reviewed staff’s request for an appropriation of $1,100,000 from unassigned Measure K funds to fund the resurfacing of RZ17 and authorize the Maintenance Superintendent to execute a change order to MCK Services, Inc. The Budget Committee has recommended the City Council approve the funding as proposed in the resolution.
FISCAL IMPACT
This change order will be funded from Fund 3, Measure K fund.
PUBLIC CONTACT
Public contact was made through posting of the City Council agenda on the City’s official notice bulletin board, at the Pleasant Hill Senior Center and at the Pleasant Hill Police Department. The agenda and staff report are posted on the City’s web page.
RECOMMENDED CITY COUNCIL ACTION
Adopt the proposed resolution to approve the resurfacing of Residential Zone 17 as part of the 2022 Street Resurfacing Project No. PSC-01-22 and authorize the Maintenance Superintendent to execute a construction change order with MCK Services.
ALTERNATIVES TO RECOMMENDED ACTION
Not authorize a change order to resurface Residential Zone 17 as part of the 2022 Street Resurfacing Project No. PSC-02-22.
ATTACHMENT(S):
Proposed Resolution
Project Map
Prepared by: Ann James, Maintenance Superintendent
Approved by: June Catalano, City Manager
9.3 Packet Pg. 157
RESOLUTION NO. ___-23
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PLEASANT HILL
APPROVING THE APPROPRIATION OF MEASURE K FUNDS TO FUND THE RESURFACING OF RESIDENTIAL ZONE 17 AS PART OF THE 2022 STREET RESURFACING PROJECT NO. PSC-01-22 AND AUTHORIZING THE MAINTENANCE
SUPERINTENDENT TO EXECUTE A CONSTRUCTION CHANGE ORDER WITH MCK SERVICES, INC.
WHEREAS, the City has adopted the FY 2022 – 2027 Capital Improvement Plan which includes the Street Resurfacing Program as a funded project; and WHEREAS, the 2022 Street Resurfacing Project No. PSC-01-22 provides for the repair of asphalt failure, ADA curb ramp installation, limited curb, gutter and valley gutter replacement, Full Depth Reclamation, asphalt concrete overlay, monument preservation and final striping in two residential neighborhoods and two collector streets within the City of Pleasant Hill; and WHERAS, Engineering staff has determined that Residential Zone 17 would benefit from a resurfacing treatment; and
WHEREAS, the resurfacing of Residential Zone 17 is identified in the City’s five year Street Resurfacing Program; and
WHEREAS, Maintenance staff has determined there is available budget in Fund 3, the Measure K fund to include the resurfacing of Residential Zone 17 in the 2022 Street Resurfacing Project No. PSC-01-22.
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Pleasant Hill as follows:
1. An appropriation of $1,100,000 from the Measure K Fund to the Street Resurfacing Fund is authorized for the resurfacing of Residential Zone 17.
2. The Maintenance Superintendent is authorized to execute a construction change order for the resurfacing of Residential Zone 17 with MCK Services Inc., as part of the 2022 Street Resurfacing Project No. PSC-01-22 at the unit prices set forth in the bid. [Signatures on the Following Page]
9.3.a
Packet Pg. 158 Attachment: Proposed Resolution (Appropriate Measure K funds for Resurfacing of RZ17) ADOPTED by the City Council of the City of Pleasant Hill at a regular meeting held on the 27th day of February 2023, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
___________________________________
TIMOTHY M. FLAHERTY, Mayor
ATTEST:
DANIELLE K. NAVARRO, City Clerk
9.3.a
Packet Pg. 159 Attachment: Proposed Resolution (Appropriate Measure K funds for Resurfacing of RZ17) TAY
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9.3.b
Packet Pg. 160 Attachment: Project Map (Appropriate Measure K funds for Resurfacing of RZ17)
CITY COUNCIL STAFF REPORT
Meeting Date: February 27, 2023
TO: THE HONORABLE MAYOR AND CITY COUNCILMEMBERS
SUBJECT: ADOPT RESOLUTION NO. ___-23 APPROVING MEASURE K
RESERVE & APPROPRIATING ADDITIONAL CAPITAL
IMPROVEMENT PROJECTS
SYNOPSIS
The Measure K Fund has approximately $10.2 million in total fund balance with $6.0 million that is unassigned. On February 22, 2023, staff provided proposals to the Budget Committee regarding allocation of the unassigned fund balance. The Budget Committee recommends the approval of staff proposals for additional Measure K Capital Improvement Projects and maintenance of a reserve fund balance.
DISCUSSION
Background
Pleasant Hill voters adopted Measure K, a one-half-cent transactions and use tax (TUT), in November 2016. The tax became effective on April 1, 2017, and will sunset on March 31, 2037, unless extended by Pleasant Hill voters. At the time, annual revenues to the City were estimated at $4.0 million.
During 2020, the City was confronting the health and financial impacts of the Coronavirus (COVID-19) pandemic. The assumption at the beginning of COVID-19 was that sales tax revenues would decline significantly. This was based on reduced sales since health officials’ guidance was to shelter at home and only purchase essential goods (i.e., food and medicine). The City Council was aware of this concern and reduced Measure K spending, except for the costs related to the construction of the new library.
COVID-19 caused disruptions to the economy, but sales tax revenue was an exception, as consumers continued to purchase goods online during this time. The City has seen historical highs for sales tax revenues over the last couple of years, including in the Measure K Fund. The City budgeted $3.8 million and $4.0 million, and received $4.9 million and $5.3 million in sales tax revenue for FY 20/21 and FY 21/22, respectively.
On November 30, 2022, this preliminary information was brought forward to the Budget Committee for its consideration. The Budget Committee directed staff to identify “shovel9.4 Packet Pg. 161
ready” projects for the Committee’s consideration and potential recommendation to City Council assuming no financial changes due to the Measure K audit.
Analysis
On February 23, 2023, the Budget Committee was presented with the Measure K audit and confirmed the fund balance that was provided to them last November. The improved sales tax revenues and conservative spending resulted in the Measure K Fund having a fund balance of $10.2 million in FY 21/22, with $4.2 million restricted for debt proceeds for the library and $6.0 million that is unassigned.
9.4 Packet Pg. 162
The Budget Committee reviewed proposals from staff to allocate the unassigned fund balance.
The table below provides a summary of the Measure K Unassigned Fund Balance, appropriations approved by City Council, and identifies the proposed projects and reserves.
Description Amount
Measure K Fund Balance - July 1, 2022 (audited) $ 10,191 Approved City Council Budget Amendments:
Bicycle Pedestrian Study $ (8)
Gregory Garden Storm Drain Final Project Costs $ (85)
Budget Amendments Subtotal $ (93)
Library:
FY 2023 Capital Paid to Date & Estimated Budgeted Costs Remaining (*) $ (4,869) Library Subtotal $ (4,869)
New Projects:
Maintenance -
Pothole Repair $ (100)
Street Resurfacing Program Residential Zone 17 $ (1,000) Maintenance Subtotal $ (1,100)
Engineering -
Oak Park Sidewalk Gap Closure $ (805)
Engineering Subtotal $ (805)
Measure K Reserve $ (2,500)
Ending Estimated Fund Balance $ 824
* Final project close out payments are currently being negotiated
SUMMARY OF MEASURE K
PROPOSED & ESTIMATED USES FOR PROJECTS AND RESERVES
($ in thousands)
The Budget Committee recommends establishing an assigned fund balance reserve and allocations for the following projects that are currently unfunded or lack sufficient funding to complete.
$2.5 million assigned Measure K reserve fund balance
$1.1 million budget appropriation for the Pothole Repair and the Street Resurfacing Program Residential Zone 17 which was not originally funded $730 thousand budget appropriation for the Oak Park Boulevard Sidewalk Gap Closure (the City Council approved $75 thousand in FY 2023/2024 for design, but the additional funds will now accelerate and fully fund the total project for $805 thousand) Staff will be presenting contract approvals following this introduction so that these “shovelready” projects can move forward.
FISCAL IMPACT
The fiscal impact would be to appropriate funding for Capital Improvement Projects with Measure
9.4 Packet Pg. 163
K funding and maintain an assigned fund balance reserve in FY 2022/2023.
PUBLIC CONTACT
Public contact was made through posting of the City Council agenda on the City’s official notice bulletin board, at the Pleasant Hill Senior Center and at the Pleasant Hill Police Department. The agenda and staff report are posted on the City’s web page.
RECOMMENDED CITY COUNCIL ACTION
Adopt resolution approving the appropriation of additional Measure K Capital Improvement Projects and the assigned reserved fund balance.
ALTERNATIVES TO RECOMMENDED ACTION
Do no adopt the resolution approving the additional Capital Improvement Projects and the assigned reserved fund balance, and provide direction to staff.
ATTACHMENT(S):
Proposed Resolution
Prepared by: Erick Cheung, Finance Manager
Approved by: June Catalano, City Manager
9.4 Packet Pg. 164
RESOLUTION NO. ___-23
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PLEASANT HILL
APPROVING MEASURE K FUND RESERVE AND APPROPRIATING ADDITIONAL
CAPITAL IMPROVEMENT PROJECTS
WHEREAS, on June 27, 2022, the City Council adopted the City’s Biennial Budget for the fiscal years (FY) July 1, 2022 through June 30, 2023 (“22/23”) and July 1, 2023 through June 30, 2024 (“23/24”) which included the Measure K funds; and WHEREAS, on July 11, 2022, the City Council adopted the FY 2022/2027 (“22/27”) Capital Improvement Plan and Expenditures for FY 22/23 and FY 23/24 which included Measure K projects and activities; and
WHEREAS, the audited Measure K fund has a fund balance of $10.2 million in FY 21/22, with $4.2 million restricted for debt proceeds for the library and $6.0 million that is unassigned; and
WHEREAS, the Budget Committee reviewed creating an assigned reserve and unfunded projects for consideration that aligned with the intended use of Measure K funds.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Pleasant Hill approves the Measure K reserve for $2,500,000.
BE IT FURTHER RESOLVED, that the City Council of the City of Pleasant Hill authorizes an appropriation and transfer of funds for the allocation of $1,905,000 for the following Measure K Projects to the Gas Tax Fund:
a) Pothole Repair - $100,000
b) Street Resurfacing Program Residential Zone 17 - $1,000,000 c) Oak Park Sidewalk Gap Closure - $805,000.
ADOPTED by the City Council of the City of Pleasant Hill at a regular meeting of the Council held on the 27th day of February, 2023, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
TIMOTHY M. FLAHERTY, Mayor
ATTEST:
DANIELLE NAVARRO, City Clerk
9.4.a
Packet Pg. 165 Attachment: Proposed Resolution (Authorize Measure K CIP & Reserve)
CITY COUNCIL STAFF REPORT
Meeting Date: February 27, 2023
TO: THE HONORABLE MAYOR AND CITY COUNCILMEMBERS
SUBJECT: ADOPT RESOLUTION NO. ___-23 AUTHORIZING AN
APPROPRIATION OF GENERAL FUND AND MEASURE K FUNDS FOR
JANITORIAL SERVICES AT CITY FACILITIES AND AUTHORIZE
THE CITY MANAGER TO EXECUTE A CONTRACT WITH FRANK
AND GROSSMAN LANDSCAPE CONTRACTOR'S INC.
SYNOPSIS
The City of Pleasant Hill requires janitorial services at its City facilities, including City Hall, the Police Department, the Public Services Center and the Library.
The purpose of this item is for the City Council to authorize an appropriation of $17,230 for the remainder of FY22/23 and $47,709 for FY23/24 from the General Fund for janitorial services at City Hall, the Police Station and at PSC, and $9,485 for the remainder of FY22/23 and $36,200 for FY23/24 from the Measure K fund for janitorial services at the Library, and authorize the City Manager to execute a General Services Agreement with Frank and Grossman Landscape Contractors, Inc. (F&G).
The Budget Committee reviewed staff’s proposal at its meeting of February 22, 2023 and approved forwarding a recommendation to the City Council to approve the funding for the project as proposed.
DISCUSSION
Background
In May 2017, the City entered into a three-year contract with Universal Building Services (UBS) to provide janitorial services for the following City facilities: City Hall; the Public Services Center (PSC); and the Police Department. The contract expired in June 2020, but due to staffing shortages caused by the Covid 19 pandemic, and limited interest from other janitorial contractors known to perform this work, the City continued to contract with UBS on a year to year basis once the original contract expired. In the past few years there has been a noticeable decline in the quality of janitorial services the City receives from UBS. Staff has met with UBS management several times to discuss and correct the issue. UBS cites a lack of quality staff as the reason for not meeting the contract requirements, and has been unable to correct the problem. The completion of the new Library has added to the scope of janitorial services the City requires, spreading UBS’s resources even thinner.
9.5 Packet Pg. 166
Due to the continued issues with UBS, the increased project scope with the addition of the Library, and a renewed interest in from other contractors, staff issued an RFP for janitorial services on December 1, 2022. In response, F&G, BSM Facility Group, and Welcome Building Services each submitted project proposals for the City’s consideration by the December 31, 2022 deadline. In order to obtain the most qualified firm for this project, staff reviewed each proposal, and ranked the three firms as follows:
1. Frank and Grossman
2. BSM Facility Group
3. Welcome Building Services
Analysis
Section 5.10.090 of the City Municipal Code typically requires that general services, such as janitorial services, be procured through a competitive bid process when the price exceeds fifty thousand dollars ($50,000), and that award be made in connection to the bidder representing the best value to the City considering the following factors: cost; contractor’s ability, skill; ability to perform within the time required; character, integrity, reputation, judgment, experience and efficiency; quality of contractor’s performance on previous purchases or contracts; and the ability of the contractor to provide future maintenance, repair, parts and services, if necessary.
The janitorial services the City requires however, due to the secure areas that must be accessed at City Hall, the PSC, the Police Department, and the Pleasant Hill Library, are of such a nature factors other than price and responsibility are critically important and must be considered when determining the best fit for the City. These factors significantly outweigh any value of the cost savings that would be associated with the other bidders’ bids and the RFP’s were ranked accordingly.
F&G was ranked highest based on the following evaluation criteria: qualifications of the project management and staff, understanding of the City’s needs, ability to meet each buildings individual needs and schedule for services, the quality of their work, and the quality of their work on previous contracts.
The authorized budgeted amount for FY22/23 for janitorial services for City Hall, the Police Department, the PSC and the Library is $133,291 ($93,291 from the General Fund for City Hall, the Police Department and PSC, and $40,000 from Measure K Fund for the Library). The annual cost for janitorial services for F&G, including labor, materials and consumables is 217,200 ($18,100/month), per the below breakdown:
City Hall (3 days) $6,200 per month $74,400 annually
Public Services Center (2 days) $1,050 per month $12,600 annually Police Department (3 days) $4,500 per month $54,000 annually Library (5 days) $6,350 per month $76,200 annually
F&G is a quality contractor located in Hayward, CA and employ a janitorial staff of over 30 people.
Their current janitorial contracts include the City of Brentwood, the City of Palo Alto and the City
9.5 Packet Pg. 167
of Gilroy. Staff has verified their references and believe they will provide quality service to the City.
Staff anticipates the new janitorial contract beginning March 1, 2023. The Budget Committee has reviewed staff’s request for an appropriation of $64,939 from the General Fund and $45,685 from the Measure K Fund for janitorial services at our City Facilities and recommends the City Council approve the funding as proposed in the resolution.
FISCAL IMPACT
The change in the janitorial contact will be funded from the General Fund and the Measure K Fund.
PUBLIC CONTACT
Public contact was made through posting of the City Council agenda on the City’s official notice bulletin board, at the Pleasant Hill Senior Center and at the Pleasant Hill Police Department. The agenda and staff report are posted on the City’s web page.
RECOMMENDED CITY COUNCIL ACTION
Adopt proposed resolution.
ALTERNATIVES TO RECOMMENDED ACTION
Not adopt resolution and provide direction to staff.
ATTACHMENT(S):
Proposed Resolution
Exhibit 1 - Agreement
Exhibit A - Proposal
Prepared by: Ann James, Maintenance Superintendent
Approved by: June Catalano, City Manager
9.5 Packet Pg. 168
RESOLUTION NO. -23
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PLEASANT HILL
AUTHORIZING AN APPROPRIATION OF GENERAL FUND AND MEASURE K FUNDS
FOR JANITORIAL SERVICES AT CITY HALL FACILITIES AND AUTHORIZE THE CITY
MANAGER TO EXECUTE A CONTRACT WITH FRANK AND GROSSMAN LANDSCAPE CONTRACTOR’S INC.
WHEREAS, the City of Pleasant Hill (“City”) has a need for janitorial services; and WHEREAS, the section 5.10.090 of the City Municipal Code generally requires that general services, such as janitorial services, be procured through a competitive bid process when the price exceeds fifty thousand dollars ($50,000), and that award be made in connection to the bidder representing the best value to the City considering the following factors: cost; contractor’s ability, skill; ability to perform within the time required; character, integrity, reputation, judgment, experience and efficiency; quality of contractor’s performance on previous purchases or contracts; and the ability of the contractor to provide future maintenance, repair, parts and services, if necessary; and
WHEREAS, the janitorial services are of such a nature owing to the secure areas that must be accessed City Hall, the Public Services Center, the Police Department, and the Pleasant Hill Library, that consideration of factors other than price and responsibility must be considered; and WHEREAS, City staff recommends that the janitorial services contract be awarded to the bid received from Frank & Grossman Landscape Contractors, Inc. (“F&G) on the basis of City staff’s analysis that F&G is the superior bidder on the basis of “ability, capacity or skill; ability to perform within the time required; character, integrity, reputation, judgment, experience and efficiency; quality of contractor’s performance on previous purchases or contracts, if applicable; and the ability of the contractor to provide future maintenance, repair, parts and services, if necessary”, and that such factors significantly outweigh any value of the cost savings that would be associated with the other bidders’ bids; and
WHEREAS, F&G has submitted a proposal to the Maintenance Division which is complete and acceptable.
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Pleasant Hill:
1. Authorizes an appropriation of $17,230 for the remainder of FY22/23 and $47,709 for FY23/24 from the General Fund for janitorial services at City Hall, the Police Station and at PSC, and $9,485 for the remainder of FY22/23 and $36,200 for FY23/24 from the Measure K fund for janitorial services at the Library.
2. Authorizes the City Manager to execute a General Services Agreement (Exhibit 1) with Frank and Grossman Landscape Contractor’s Inc. for janitorial services at City Hall, the Public Services Center, the Police Department and the Library in an amount not to exceed $18,100 per month, consistent with F&G’s bid.
9.5.a
Packet Pg. 169 Attachment: Proposed Resolution (New Janitorial Services Contract) ADOPTED by the City Council of the City of Pleasant Hill at a regular meeting held on the 27th day of February, 2023, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
___________________________________
TIMOTHY M. FLAHERTY, Mayor
ATTEST:
DANIELLE K. NAVARRO, City Clerk
9.5.a
Packet Pg. 170 Attachment: Proposed Resolution (New Janitorial Services Contract)
9.5.b
Packet Pg. 171 Attachment: Exhibit 1 - Agreement (New Janitorial Services Contract)
9.5.b
Packet Pg. 172 Attachment: Exhibit 1 - Agreement (New Janitorial Services Contract)
9.5.b
Packet Pg. 173 Attachment: Exhibit 1 - Agreement (New Janitorial Services Contract)
9.5.c
Packet Pg. 174 Attachment: Exhibit A - Proposal (New Janitorial Services Contract)
9.5.c
Packet Pg. 175 Attachment: Exhibit A - Proposal (New Janitorial Services Contract)
9.5.c
Packet Pg. 176 Attachment: Exhibit A - Proposal (New Janitorial Services Contract)
9.5.c
Packet Pg. 177 Attachment: Exhibit A - Proposal (New Janitorial Services Contract)
9.5.c
Packet Pg. 178 Attachment: Exhibit A - Proposal (New Janitorial Services Contract)
9.5.c
Packet Pg. 179 Attachment: Exhibit A - Proposal (New Janitorial Services Contract)
9.5.c
Packet Pg. 180 Attachment: Exhibit A - Proposal (New Janitorial Services Contract)
9.5.c
Packet Pg. 181 Attachment: Exhibit A - Proposal (New Janitorial Services Contract)
9.5.c
Packet Pg. 182 Attachment: Exhibit A - Proposal (New Janitorial Services Contract)
9.5.c
Packet Pg. 183 Attachment: Exhibit A - Proposal (New Janitorial Services Contract)
CITY COUNCIL STAFF REPORT
Meeting Date: February 27, 2023
TO: THE HONORABLE MAYOR AND CITY COUNCILMEMBERS
SUBJECT: ADOPT RESOLUTION NO. __-23 OPPOSING INITIATIVE NO. 21- 0042A1, THE TAXPAYER PROTECTION AND GOVERNMENT
ACCOUNTABILITY ACT, AND DIRECT STAFF TO SEND A LETTER
OF OPPOSITION TO THE LEAGUE OF CALIFORNIA CITIES
DIRECTOR OF PUBLIC AFFAIRS
SYNOPSIS
The Taxpayer Protection and Government Accountability Act would amend the California Constitution with provisions that limit voters’ authority and input, adopt new and stricter rules for raising taxes and fees, and may make it more difficult to impose fines and penalties for violation of state and local laws. The measure puts billions of local government tax and fee revenues at risk statewide with related core public service impacts and would have negative financial impacts to the City, which could affect funding for operations and core service delivery.
Staff supports the League of California Cities’ recommendation that the City Council adopt the proposed resolution opposing Initiative No. 21-0042A1, the Taxpayer Protection and Government Accountability Act, and direct staff to send the proposed letter of opposition to the Director of Public Affairs at the League of California Cities.
DISCUSSION
Background
On January 4, 2022, the California Business Roundtable filed the “Taxpayer Protection and Government Accountability Act” or AG# 21-0042A1. On February 1, 2023, the measure qualified for the November 2024 ballot. The League of California Cities (“Cal Cities”), along with a broad coalition of local governments, labor and public safety leaders, infrastructure advocates, and businesses, strongly opposes this initiative as local government revenue-raising authority is substantially restricted by state statute and constitutional provisions, including the voter approved provisions of Proposition 13 (1978), Proposition 218 (1996), and Proposition 26 (2010). The Taxpayer Protection and Government Accountability Act adds and expands restrictions on voters and local government tax and fee authority and would be retroactive to January 1, 2022.
Fees and Taxes
9.7 Packet Pg. 184
Local governments levy a variety of fees and other charges to provide core public services.
Major examples of affected fees and charges are:
Nuisance abatement charges, such as for weed, rubbish, and general nuisance abatement to fund community safety, code enforcement, and neighborhood cleanup programs. Commercial franchise fees.
Emergency response fees, such as in connection with DUI (driving under the influence). Advanced Life Support (“ALS”) transport charges.
Document processing and duplication fees.
Transit fees, tolls, parking fees, and public airport, and harbor use fees. Facility use charges, fees for parks and recreation services, and garbage disposal tipping fees.
Virtually every city, county, and special district must regularly (e.g., annually) adopt increases to fee rates and charges and revise rate schedules to accommodate new users and activities. Most of these would be subject to new standards and limitations under threat of legal challenge. Based on the current volume of fees and charges imposed by local agencies, including Council-adopted increases to simply accommodate inflation, Cal Cities estimates the amount of local government fee and charge revenue at risk is approximately $2 billion per year including those adopted since January 1, 2022. Over ten years, $20 billion of local government fee and charge revenues will be at heightened legal peril.
Per Cal Cities, hundreds of local tax measures were approved in 20221that likely do not comply with the provisions of the initiative. Nearly $2 billion of annual revenues from these voterapproved measures will cease a year after the effective date of the measure, reducing the local public services funded by these measures, unless the tax is re-submitted for voter approval.
Reductions on local government tax revenues have impacts on core services and infrastructure provided by the City, the County, and special districts, including fire and emergency response, law enforcement, streets and roads, drinking water, sewer sanitation, parks, libraries, public schools, affordable housing, homelessness prevention, and mental health services.
Fines and Penalties
Under existing law, cities are required to provide due process before imposing a penalty or fine for violation of its municipal code:
1. A local agency must adopt administrative procedures that govern imposing fines and penalties, including providing a reasonable period of time for a person responsible for a continuing violation to correct or remedy the violation [Gov't Code 53069.4].
2. Notice must be given to the violating party before imposing the penalty; and give the party an opportunity to be heard and present any facts or arguments [Merco Construction Engineers v. Los Angeles Unified School District (1969) 274 CA 2d 154, 166].
3. The fine may not be "excessive" [U.S. Constitution amendments VIII and XIV].
1 http://www.californiacityfinance.com/Votes2211final.pdf
9.7 Packet Pg. 185
The initiative converts administratively-imposed fines and penalties into taxes unless a new, undefined, and ambiguous “adjudicatory due process” is followed. This provision may put at risk authority to impose fines and penalties for violations of state and local law.
Analysis
The Taxpayer Protection and Government Accountability Act would amend the California Constitution with provisions that limit voters’ authority and input, adopt new and stricter rules for raising taxes and fees, and may make it more difficult to impose fines and penalties for violation of state and local laws. The measure puts billions of local government tax and fee revenues at risk statewide with related core public service impacts and would have negative financial impacts on the City of Pleasant Hill’s funding for operations and core service delivery.
9.7 Packet Pg. 186
I. MAJOR PROVISIONS
Fees and Charges2:
Except for licensing and other regulatory fees, fees and charges may not exceed the “actual cost” of providing the product or service for which the fee is charged. “Actual cost” is the “minimum amount necessary.” The burden to prove the fee or charge does not exceed “actual cost” is changed to “clear and convincing” evidence. Requires fees and charges paid for the use of local and state government property and the amount paid to purchase or rent government property to be “reasonable.” These fees and charges are currently allowed to be market-based. Whether the amount is “reasonable” (introducing a new legal standard aiming to force below market fee and charge amounts) must be proved by “clear and convincing evidence.”3 The standard may significantly reduce the amount large companies (e.g., oil, utilities, gas, railroads, garbage/refuse, cable, and other corporations) will pay for the use of local public property. Prohibits fees on new development based on vehicle miles traveled.
Taxes4:
Taxes and fees adopted after January 1, 2022, that do not comply with the new rules, are void unless reenacted5.
Invalidates Upland decision that allows a majority of local voters to pass special taxes.
The measure specifies that taxes proposed by the initiative are subject to the same rules as taxes placed on the ballot by a city council.
Expressly prohibits local advisory measures which allow local voters to express a preference for how local general tax dollars should be spent.6 Requires voter approval to expand existing taxes (e.g., Utility, Transient Occupancy) to new territory (e.g., annexations) or to expand the tax base (e.g., new utility service) New taxes can only be imposed for a specific time period. City charters may not be amended to include a tax or fee. All state taxes require majority voter approval.
2 Initiative No. 21-0042A1 (pgs.4-6; Section 1 (a)-(j)
3 Initiative No. 21-0042A1 (pg.5; (3))
4 Initiative No. 21-0042A1 (pgs.4-6; Section 1 (a)-(j)
5 Initiative No. 21-0042A1 (pg.7; Section 6 (Sec. 2)(g) 6 Initiative No. 21-0042A1 (pg.6 (3))
9.7 Packet Pg. 187
Fines and Penalties7
:
May require voter approval of fines, penalties, and levies for corporations and property owners that violate state and local laws unless a new, undefined adjudicatory process is used to impose the fines and penalties.
Support the League of California Cities’ recommendation that the City oppose Initiative No. 21- 0042A1, the Taxpayer Protection and Government Accountability Act, and direct staff to send the proposed letter of opposition to the Director of Public Affairs at the League of California Cities.
FISCAL IMPACT
There is no fiscal impact to the City to adopt the resolution and email the proposed letter to the Director.
If it passes, the Taxpayer Protection and Government Accountability Act will take billions of dollars away from local government services statewide. Pleasant Hill would likely face fee revenue loss, increased legal defense costs, and significant staff time to be in compliance with this measure.
PUBLIC CONTACT
Public contact was made through posting of the City Council agenda on the City’s official notice bulletin board, at the Pleasant Hill Senior Center, and at the Pleasant Hill Police Department. The agenda and staff report are posted on the City’s web page.
RECOMMENDED CITY COUNCIL ACTION
Adopt the proposed resolution opposing Initiative No. 21-0042A1, the Taxpayer Protection and Government Accountability Act and direct staff to send the proposed letter of opposition to the Director of Public Affairs at the League of California Cities.
ALTERNATIVES TO RECOMMENDED ACTION
Do not adopt the proposed resolution.
Give direction to staff to amend the resolution and/or letter.
ATTACHMENT(S):
Proposed Resolution
Proposed Letter Opposing Initiative 21-0042A1
7 Initiative No. 21-0042A1 (pg. 5 (4))
9.7 Packet Pg. 188
Summary of the Taxpayer Protection and Government Accountability Act Initiative No. 21- 0042A1
Fiscal & Program Effects of Initiative 21-0042A1 on Local Governments Correspondence
Prepared by: Danielle K. Habr, Principal Management Analyst/City Clerk Reviewed by: Erick Cheung, Finance Manager
Approved by: June Catalano, City Manager
9.7 Packet Pg. 189
RESOLUTION NO. ___-23
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PLEASANT HILLOPPOSING INITIATIVE NO. 21-0042A1, THE TAXPAYER PROTECTION AND GOVERNMENT
ACCOUNTABILITY ACT
WHEREAS, an association representing California’s wealthiest corporations and developers is spending millions to push a deceptive proposition aimed for the November 2024 statewide ballot; and WHEREAS, the measure includes undemocratic provisions that would make it more difficult for local voters to pass measures needed to fund local services and infrastructure, and would limit voter input by prohibiting local advisory measures where voters provide direction on how they want their local tax dollars spent; and
WHEREAS, the measure creates new constitutional loopholes that allow corporations to pay far less than their fair share for the impacts they have on our communities, including local infrastructure and our environment; and
WHEREAS, the measure may make it much more difficult for state and local regulators to issue fines and levies on corporations that violate laws intended to protect our environment, public health and safety, and our neighborhoods; and
WHEREAS, the measure puts billions of dollars currently dedicated to local services at risk and could force cuts to fire and emergency response, law enforcement, public health, parks, libraries, affordable housing, services to support homeless residents, mental health services, among other services.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Pleasant Hill opposes Initiative 21-0042A1.
BE IT FURTHER RESOLVED, that the that the City Council of the City of Pleasant Hill will join the No on Initiative 21-0042A1 coalition, a growing coalition of public safety, education, labor, local government, and infrastructure groups throughout the state.
BE IT FURTHER RESOLVED, that the City Clerk is directed to email a copy of this adopted resolution to the League of California Cities at [email protected].
ADOPTED by the City Council of the City of Pleasant Hill at a regular meeting of the Council held on the 27th day of February, 2023, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
TIMOTHY M. FLAHERTY, Mayor
ATTEST:
DANIELLE NAVARRO, City Clerk
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Packet Pg. 190 Attachment: Proposed Resolution (Oppose Taxpayer Protection & Government Accountability Act) Mayor
100 Gregory Lane, Pleasant Hill, CA 94523-3323 – (925) 671-5270 www.pleasanthillca.org
February 27, 2023
Bismarck Obando
Director of Public Affairs, League of California Cities 1400 K Street, Suite 400
Sacramento, CA 95814
RE: Letter Opposing Initiative 21-0042A1
On February 27, 2023, the City of Pleasant Hill City Council voted to adopt Resolution No. ___-23 opposing Initiative 21-0042A1, a deceptive, developer-sponsored proposition aimed for the November 2024 statewide ballot that would significantly jeopardize cities’ ability to provide essential services and infrastructure for our residents.
The measure includes undemocratic provisions that would make it more difficult for local voters to pass measures needed to fund local services and projects and would limit voter input by prohibiting local advisory measures where voters can express a preference on how they want their local tax dollars spent.
This measure creates new constitutional loopholes that allow corporations to pay far less than their fair share for the impacts they have on our communities, including impacts on local infrastructure and our environment.
This measure also may make it much more difficult for state and local regulators to issue fines and levies on corporations that violate laws intended to protect our environment, public health and safety, and our neighborhoods.
Unless defeated, the measure puts billions of dollars currently dedicated to local services at risk, and could force cuts to fire and emergency response, law enforcement, public health, parks, libraries, affordable housing, services to support homeless residents, mental health services, and more.
The measure benefits wealthy corporations and real estate developers while decimating our local communities and neighborhoods.
You may list the City of Pleasant Hill in formal opposition to Initiative #21-0042A1 and include our city as part of the growing coalition of public safety, labor, local government, infrastructure advocates, and other organizations throughout the state opposed to this deceptive proposition.
Sincerely,
Timothy M. Flaherty
Mayor
9.7.b
Packet Pg. 191 Attachment: Proposed Letter Opposing Initiative 21-0042A1 (Oppose Taxpayer Protection & Government Accountability Act) 1 The Taxpayer Protection and Government Accountability Act Initiative No. 21-0042A11
Feb. 1, 2023
Effective date: Any new or increased tax or fee adopted by the Legislature, a city council, or the local voters after January 1, 2022, must comply with the Act’s new rules.
Voters
• Local advisory measures are prohibited. No measure may appear on the ballot asking for approval of a general tax that would allow the voters to express a preference for how the revenue from the general tax will, could, or should be used.
• Overturns Upland decision which upheld a special tax that had been placed on the ballot by the voters to be approved by a majority vote. Taxes proposed by initiative will be subject to the same rules as taxes placed on the ballot by a city council.
• Voters may not amend a city charter to impose, extend, or increase a tax or fee.
Local taxes
• Requires voter approval in order to apply an existing tax:
o to territory that is annexed.
o to a new service or product, for example when a utility user tax is applied to a new service.
• All new or increased taxes adopted after Jan. 1, 2022, must include a sunset date.
State taxes
• All new or increased state taxes require statewide voter approval. • Prohibits a property tax “surcharge” (increase). Prohibits any allocation of property tax to the state.
1 This is a summary of some of the more significant provisions of the Act. Please review the Act for a complete understanding of the changes it makes to the Constitution.
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Packet Pg. 192 Attachment: Summary of the Taxpayer Protection and Government Accountability Act Initiative No. 21-0042A1 (Oppose Taxpayer Protection & 2 Fees and charges
• Fees and charges for services and permits may not exceed the “actual cost” of providing the product or service for which the fee is charged. “Actual cost” is the “minimum amount necessary.” Examples include planning services, excavation and encroachment permits, preparation of candidate statement, and permit parking.
• State and cities have the burden of proving by “clear and convincing evidence” that a fee/charge is not a tax, that the amount is reasonable, and that it does not exceed “actual cost.”
• Franchise fees — historically considered fees, not taxes — will more likely be considered taxes due to the elimination of an existing category of “fee” and the requirement that charges to entrance, purchase, rental, or lease of government property be “reasonable.” The state and cities issue franchises to oil companies, utilities, gas companies, railroads, garbage companies, cable companies, and other corporations.
• No fee or charge or exaction regulating vehicle miles traveled can be imposed as a condition of property development or occupancy.
Fines and penalties (administrative enforcement of state law and municipal codes)
• May require voter approval of fines and penalties for corporations and property owners that violate state and local laws unless a new, undefined adjudicatory process is used to impose the fines and penalties. Examples include nuisance abatement, organic waste reduction requirements, and failure to maintain a vacant property.
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Packet Pg. 193 Attachment: Summary of the Taxpayer Protection and Government Accountability Act Initiative No. 21-0042A1 (Oppose Taxpayer Protection & CaliforniaCityFinance.Com
Fiscal and Program Effects of
Initiative 21-0042A1 on Local Governments
If Initiative 21-0042A1 is placed on the ballot and passed by voters, it will result in:
Over $20 billion of local government fee and charge revenues over 10 years placed at heightened legal peril. Related public service reductions across virtually every aspect of city, county, special district, and school services especially for drinking water, sewer sanitation, and public health and safety. About $2 billion of revenues each year from fees and charges adopted after January 1, 2021 subject to legal peril.
1 Over $2 billion dollars of annual revenues from dozens of tax measures approved by voters between January 1, 2022 and the effective date of the act2 subject to additional voter approval if not in compliance with the initiative.
Indeterminable legal and administrative burdens and costs on local government from new and more empowered legal challenges, and bureaucratic cost tracking requirements. The delay and deterrence of municipal annexations.
Substantially higher legal and administrative cost of public infrastructure financing which will delay and deter new residential and commercial development.
Service and infrastructure declines including in fire and emergency response, law enforcement, public health, drinking water, sewer sanitation, parks, libraries, public schools, affordable housing, homelessness prevention and mental health services.
1. Local Government Taxes and Services Threatened
With regard to taxes, Initiative 21-0042A1:
Prohibits advisory, non-binding measures as to use of tax proceeds on the same ballot. o Voters may be less informed and more likely to vote against measures. Eliminates the ability of special tax measures proposed by citizen initiative to be enacted by majority voter approval (Upland).3
o Because the case law regarding citizen initiative special taxes approved by majority vote (Upland) is so recent, it is unknown how common these sorts of measures might be in the future. This initiative would prohibit such measures after the effective date of the initiative. Any such measures adopted after January 1, 2022 through the effective date of the Act should it pass would be void a year after the effective date of the initiative. Requires that tax measures include a specific duration of time that the tax will be imposed. This seems to require that all tax increases or extensions contain a sunset (end date). o This would require additional tax measures to extend previously approved taxes. A city charter may not be amended to impose, extend, or increase a tax might interfere with the ability of cities that do not already have such authority in their charters to adopt Property Transfer Taxes. o There are no more than a few of these every few years, but it is a valuable tax for those that adopt it.
1 Assumes fee increases since January 1, 2022 would be subject to possible legal challenge if not adopted in compliance with the Initiative.
2 The effective date of the initiative would be sometime in December 2024, the date the California Secretary of State certifies the election results of the November 5, 2024 election.
3 Unlike the initiative 17-0050, this initiative does not eliminate that ability of cities and counties to adopt general taxes by majority voter approval.
2217 Isle Royale Lane • Davis, CA • 95616-6616
Phone: 530.758.3952 • Fax: 530.758.3952
Rev. January 14, 2023
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Requires that a tax measure adopted after January 1, 2022 and before the effective date of the initiative that was not adopted in accordance with the measure be readopted in compliance with the measure or will be void twelve months after the effective date of the initiative. o If past election patterns and elections in 2022 are an indication, over 200 tax measures approving more than $2 billion annual revenues to support local public services would not be in compliance and would be subject to reenactment. Most will be taxes without a specific end date and special taxes (including parcel taxes). Because there is no regularly scheduled election within the 12 months following the effective date of the initiative, the measures would each require declaration of emergency and unanimous vote of the governing board to be placed on a special election ballot within a year for approval or the tax will be void after that date. I would expect most to succeed, but some will not, in particular citizen initiative majority vote special taxes which would have to meet a higher voter approval threshold to continue. Requires voter approval to expand an existing tax to new territory (annexations). This would require additional tax measures and would deter annexations and land development in cities. o If a tax is "extended" to an annexed area without a vote after January 1, 2022, it will be void 12 months later until brought into compliance. Because there is no regularly scheduled election within the 12 months following the effective date of the initiative, such extensions would each require unanimous vote of the agency board to be placed on a special election ballot or would be void a year later.
1.a. Number of Measures and Value of Local Taxes at Risk4 Over a hundred local measures were approved in 2022 that likely do not comply with the provisions of Initiative 21-0042A1. Nearly $2 billion of annual revenues from these voter approved measures will cease a year after the effective date of the measure, reducing the local public services funded by these measures. We can expect a similar volume of measures in 2024 and a similar volume of non-compliance. So the combined total of annual local funding directly affected by Initiative 21-0042A1 due to its retroactivity provision is about $4 billion.
Citizen Initiative Special Taxes in 2022.
Special taxes placed on the ballot by citizen initiative and approved after January 1, 2022 by a majority but less than two-thirds of the voters are out of compliance with Initiative 21-0042A1.
On June 7, 2022, there were three local special tax measures placed on the ballot by citizen initiative. Two failed to get majority voter approval. A one percent transactions and use tax (sales tax) for the John C. Fremont Healthcare District in Mariposa County received 69.6 percent approval, over the two thirds needed for any special tax under California Constitution Article XIIIC. So this measure was passed in compliance with Initiative 21- 0042A1.
On November 8, 2022, there were 14 local special taxes placed on the ballot by citizen initiative. Seven of these 4 Source: Compilation and summary of data from County elections offices.
June 2022 Initiative Special Taxes - majority voter approval Agency Name County Tax/Fee Rate
Estimated
Annual Revenue Use Sunset YES%
John C. Fremont
Healthcare District Mariposa Measure N Transactions & Use Tax 1 cent $ 150,000 hospital 40yrs 69.6% PASS County of Kings Kings Measure F Transactions
& Use Tax 1/2 cent $ 11,700,000 fire none 37.6% FAIL
Manhattan Beach
USD Los Angeles Measure A School Parcel Tax $1095/yr $ 12,000,000 schools 12yrs 31.2% FAIL
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measures failed with less than majority voter approval. The other seven measures received majority, but less than two-thirds, voter approval. These measures passed under current law but are out of compliance with Initiative 21- 0042A1. Taken together these seven taxes will provide estimated annual revenues of from $900,000 to $1.4 billion in support of parks and recreation, zoo, library, affordable housing, transportation, homelessness prevention, and schools in these communities.
Non-Specific Tax Durations in 2022
Voters approved 106 measures in June 2022 (10) and November 2022 (96) that do not provide a specific duration of time that the tax will be imposed (end date). Typically, the ballot titles for these measures state that the tax would be imposed “until ended by voters.” Four of these measures also did not include any estimate of the annual revenues that the tax would generate, another violation of initiative 21-0042A1. Taken together, these approved local measures generate $561 million per year that will expire a year after the effective date of the initiative if Initiative 21-0042A1 passes.
November 2022 Initiative Special Taxes - majority voter approval Agency Name County Tax/Fee Rate
Estimated
Annual Revenue Use Sunset YES%
Crockett Community
Services District Contra Costa Measure L Parcel Tax $50/parcel $ 60,000 parks/recr none 62.8% PASS Oakland Alameda Measure Y Parcel Tax $68/parcel $ 12,000,000 zoo 20yrs 62.5% PASS County of Mendocino Measure O Transactions
& Use Tax
1/8 cent then 1/4
cent in 2027 $ 4,000,000 library none 60.8% PASS
Los Angeles Los Angeles Measure ULA Property
Transfer Tax
4% if >$5m, 5.5%
if >$10m $600 m to $1.1 b affordable housing none 57.3% PASS County of Sacramento Measure A Transactions
& Use Tax same 1/2 cent $ 212,512,500 transportati
on
40yrs 55.3% PASS
San Francisco Proposition M Business
Operations Tax
$2500-$5000/
vacant resid unit $ 20,000,000 housing 30yrs 54.5% PASS Santa Monica Los Angeles Measure GS Property
Transfer Tax
$56/$1000 if
>$8m $ 50,000,000
schools,
homelessne
ss, afford.
housing
none 53.3% PASS
Total $900,000 to
$1.4 billion
Agency Name County Tax/Fee Rate
Estimated
Annual Revenue Use Sunset YES%
County of Calaveras Measure A Transactions
& Use Tax 1 cent $ 5,000,000 fire none 49.4% FAIL
South San Francisco
(for Schools) San Mateo Measure DD School Parcel Tax $2.50/sf $ 55,900,000 schools none 47.2% FAIL County of Fresno (for CSU ) Measure E Transactions
& Use Tax
1/5 ct,
1/40 ct (Reedley) $ 36,000,000 Calif State Univ 20yrs 46.9% FAIL Santa Cruz Santa Cruz Measure N Parcel Tax $6k/vacant SFU xxx vacant property
xxx 44.2% FAIL
County of Monterey Measure Q Parcel Tax $49/parcel $ 5,500,000 childcare 10yrs 41.1% FAIL San Francisco City
College
San
Francisco Measure O School Parcel Tax $150/sfu $ 37,000,000 schools 10yrs 36.7% FAIL Morro Bay San Luis
Obispo Measure B Parcel Tax $120+/parcel $ 680,000 harbor none 36.0% FAIL Inverness Public
Utility District Marin Measure O Parcel Tax $0.20/sf, $150/vacant $ 276,000 fire none 27.0% FAIL
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Packet Pg. 196 Attachment: Fiscal and Program Effects of Initiative 21-0042A1 on Local Governments (Oppose Taxpayer Protection & Government – 4 – rev January 14, 2023
CaliforniaCityFinance.com
Measures in 2022 with Non-Specific Durations
Agency Name County Tax/Fee Rate
Annual
Revenue Use Sunset YES%
Oakland Alameda Measure T Business Tax
General various $ 20,900,000 none 71.4% PASS
Culver City Los Angeles Measure BL Business Tax
General various $ 10,000,000 none 60.5% PASS
El Segundo Los Angeles Measure BT Business Tax
General various $ 3,000,000 none 51.2% PASS
Pico Rivera Los Angeles Measure AB Business Tax
General various $ 5,800,000 none 75.5% PASS
Santa Ana Orange Measure W Business Tax
General various neutral none 64.8% PASS
Tracy San Joaquin Measure B Business Tax
General various $ 3,200,000 none 72.6% PASS
Burlingame San Mateo Measure X Business Tax
General various $ 2,500,000 none 75.1% PASS
Los Gatos Santa Clara Measure J Business Tax
General various $ 1,100,000 none 53.4% PASS
Santa Clara Santa Clara Measure H Business Tax
General
$45/employee,
$15/rental unit $ 6,000,000 none 59.5% PASS
Brisbane San Mateo Measure O Business Tax
lodging busn $2.50/rm/day $ 250,000 none 69.2% PASS
East Palo Alto San Mateo Measure L Business Tax
resid. rentals
2.5%
grossRcpts $ 1,480,000 none 69.9% PASS
County of Santa Cruz Unincorporated Measure C Busn Tax - disp cups 12.5cents/cup $ 700,000 none 68.2% PASS
South Lake Tahoe El Dorado Measure G Busn Tax
Cannabis
6% retail,
manufacturing $ 950,000 none 62.9% PASS
McFarland Kern Measure O Busn Tax
Cannabis
8% of gross
receipts retail, $ 1,800,000 none 63.5% PASS
Avenal Kings Measure C Busn Tax
Cannabis
$25+/sf or
15% gr rcpts $ 600,000 none 61.8% PASS
Baldwin Park Los Angeles Measure CB Busn Tax
Cannabis
4%
grossRcpts $ 300,000 none 51.3% PASS
Claremont Los Angeles Measure CT Busn Tax
Cannabis
4%-7% gr
rcpts, $1- $ 500,000 none 61.1% PASS
County of Los Angeles Unincorporated Measure C Busn Tax Cannabis
4% gross
receipts retail, $ 15,170,000 none 60.1% PASS
Cudahy Los Angeles Measure BA Busn Tax
Cannabis
15%
grossRcpts $ 3,600,000 none 54.0% PASS
El Segundo Los Angeles Measure Y Busn Tax
Cannabis
10%
GrossRcpt, $ 1,500,000 none 72.8% PASS
Hermosa Beach Los Angeles Measure T Busn Tax
Cannabis
10%
GrossRcpt, $ 1,500,000 none 67.6% PASS
Lynwood Los Angeles Measure TR Busn Tax
Cannabis 5%to10% $ 3,000,000 none 66.4% PASS
Santa Monica Los Angeles Measure HM Busn Tax
Cannabis
10% gross
Rcpts $ 5,000,000 none 66.4% PASS
South El Monte Los Angeles Measure CM Busn Tax
Cannabis
6% special
excise tax on $ 126,000 none 53.7% PASS
Monterey Monterey Measure J Busn Tax
Cannabis 6% grossRcpt $ 1,300,000 none 65.2% PASS
Pacific Grove Monterey Measure N Busn Tax
Cannabis 6% grossRcpt $ 300,000 none 70.8% PASS
Huntington Beach Orange Measure O Busn Tax
Cannabis
6% retail, 1%
other $ 600,000 none 54.7% PASS
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Packet Pg. 197 Attachment: Fiscal and Program Effects of Initiative 21-0042A1 on Local Governments (Oppose Taxpayer Protection & Government – 5 – rev January 14, 2023
CaliforniaCityFinance.com
Notes
?= Ballot measure title did not include an estimate of annual revenues, also not in compliance with Initiative 21-0042A1. n/a*= Arcadia Measure SW passed but sports betting remains illegal after the failure of Propositions 26 and 27 on the November statewide ballot.
Measures in 2022 with Non-Specific Durations
Agency Name County Tax/Fee Rate
Annual
Revenue Use Sunset YES%
Laguna Woods Orange Measure T Busn Tax
Cannabis
4%-10% of
gross receipts $ 750,000 none 61.1% PASS
Corona Riverside Measure G Busn Tax
Cannabis
9% of gross
receipts for $ 5,000,000 none 61.6% PASS
Montclair San Bernardino Measure R Busn Tax
Cannabis
7%
grossRcpts $ 3,500,000 none 70.3% PASS
County of San Diego Unincorporated Measure A Busn Tax
Cannabis
6% retail, 3%
distribution, $ 5,600,000 none 57.4% PASS
Encinitas San Diego Measure L Busn Tax
Cannabis
4% to 7% of
gross receipts $ 1,400,000 none 65.1% PASS
Healdsburg Sonoma Measure M Busn Tax
Cannabis 8% grossRcpt $ 500,000 none 72.7% PASS
Exeter Tulare Measure B Busn Tax
Cannabis
10% retail and
other, $10/sf ? none 66.5% PASS
Tulare Tulare Measure Y Busn Tax
Cannabis
10% retail and
other, $10/sf ? none 65.2% PASS
Woodland Yolo Measure K Busn Tax
Cannabis
10%
grossRcpts
? none 66.2% PASS
Redlands San Bernardino Measure J Busn Tax
Distrib centers
from $0.047/sf
to $0.105/sf $ 530,000 none 53.5% PASS
Arcadia Los Angeles Measure SW Busn Tax
Sports Betting
5%
grossRcpts
n/a* none 63.9% PASS
Albany Alameda Measure K ParcelTax $0.074+/sf $ 1,950,000 fire/EMS none 76.0% PASS Cameron Park Airport
District El Dorado Measure J ParcelTax by $600 to $900/parcel $ 117,900 airport/ streets none 78.2% PASS Highlands Village
Lighting Benefit Zone El Dorado Measure L ParcelTax $140+/parcel $ 10,920 streets none 86.3% PASS Knolls Property
Owners CSD El Dorado Measure P ParcelTax by $300+ to $600+/parcel $ 8,400 streets none 75.5% PASS Sundance Trail Zone of
Benefit El Dorado Measure C ParcelTax $600+/yr $ 24,000 roads none 73.2% PASS South Pasadena Los Angeles Measure LL ParcelTax xxx ? library none 86.2% PASS River Delta Fire District Sacramento Measure H ParcelTax $90/yr $ 130,000 fire none 72.1% PASS Emeryville Alameda Measure O PropTransfTax $15/$1000 if $1m-$2m, $ 5,000,000 none 71.6% PASS
San Mateo San Mateo Measure CC PropTransfTax by 1% to 1.5% if >$10m $ 4,800,000 none 71.8% PASS
Alameda Alameda Measure F TOT by 4% to 14% $ 910,000 none 59.2% PASS Clovis Fresno Measure B TOT by 2% to 12% $ 500,000 none 69.7% PASS Kerman Fresno Measure G TOT 10% $ 40,000 none 62.3% PASS Trinidad Humboldt Measure P TOT by 4% to 12% $ 65,000 none 77.6% PASS Imperial Imperial Measure G TOT by 4% to 12% $ 600,000 none 56.2% PASS Arcadia Los Angeles Measure HT TOT by 2% to 12% $ 730,000 none 54.1% PASS Santa Monica Los Angeles Measure CS TOT by 1%, 3%
home shares $ 4,100,000 none 73.7% PASS
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Packet Pg. 198 Attachment: Fiscal and Program Effects of Initiative 21-0042A1 on Local Governments (Oppose Taxpayer Protection & Government – 6 – rev January 14, 2023
CaliforniaCityFinance.com
Measures in 2022 with Non-Specific Durations
Agency Name County Tax/Fee Rate
Annual
Revenue Use Sunset YES%
Anaheim Orange Measure J TOT online travel
companies $ 3,000,000 none 59.2% PASS
La Palma Orange Measure P TOT by 4% to 12% $ 200,000 none 71.1% PASS Colfax Placer Measure B TOT by 2% to10% $ 29,000 none 73.5% PASS Rocklin Placer Measure F TOT by 2% to 10% $ 300,000 none 59.8% PASS Roseville Placer Measure C TOT by 4% to 10% $ 3,000,000 none 73.0% PASS Big Bear Lake San Bernardino Measure P TOT by 2% to 10% $ 1,300,000 none 54.4% PASS Grand Terrace San Bernardino Measure M TOT new 10% $ 250,000 none 51.9% PASS Yucca Valley San Bernardino Measure K TOT by 5% to 12% $ 1,300,000 none 71.9% PASS Imperial Beach San Diego Measure R TOT by 4% to 14% $ 400,000 none 67.4% PASS El Paso de Robles San Luis ObispoMeasure F TOT by 1% to 11% $ 750,000 none 61.2% PASS Belmont San Mateo Measure K TOT by 2% to 14% $ 600,000 none 79.3% PASS Millbrae San Mateo Measure N TOT by 2% to 14% $ 1,500,000 none 75.8% PASS County of Humboldt Unincorporated Measure J TOT by 2% to 12% $ 3,080,000 none 63.3% PASS County of Placer -
North Tahoe TOT Area Measure A TOT by 2% to 10% $ 4,000,000 none 90.0% PASS County of Santa Cruz Unincorporated Measure B TOT by 1% to 12% $ 2,300,000 none 69.2% PASS County of El Dorado -
East Slope Tahoe Measure S TOT 2/3 by 4% to 14% $ 2,500,000 none 81.8% PASS Chico Butte Measure H TrUT 1 cent $ 24,000,000 none 52.4% PASS Mendota Fresno Measure H TrUT 1.25 cent $ 493,498 none 57.2% PASS Blue Lake Humboldt Measure R TrUT 1 cent $ 30,000 none 55.4% PASS Rio Dell Humboldt Measure O TrUT 3/4cent $ 400,000 none 53.3% PASS County of Kern unincorporated areas Measure K TrUT 1 cent $ 54,000,000 none 50.8% PASS McFarland Kern Measure M TrUT 1 cent $ 579,662 none 62.2% PASS Tehachapi Kern Measure S TrUT 1 cent $ 4,000,000 none 57.2% PASS Avenal Kings Measure A TrUT 1 cent $ 500,000 none 72.5% PASS Susanville Lassen Measure P TrUT 1 cent $ 1,750,000 none 54.7% PASS Baldwin Park Los Angeles Measure BP TrUT 3/4 cent $ 6,000,000 none 58.1% PASS Malibu Los Angeles Measure MC TrUT 1/2 cent $ 3,000,000 none 52.6% PASS Monterey Park Los Angeles Measure MP TrUT 3/4 cent $ 6,000,000 none 58.5% PASS Torrance Los Angeles Measure SST TrUT 1/2 cent $ 18,000,000 none 55.0% PASS Larkspur Marin Measure G TrUT 1/4 cent $ 700,000 none 59.4% PASS Sand City Monterey Measure L TrUT by 1/2cent to
1.5cents $ 1,400,000 none 68.7% PASS
Hemet Riverside Measure H TrUT same 1 cent $ 15,000,000 none 58.0% PASS Elk Grove Sacramento Measure E TrUT 1 cent $ 21,000,000 none 54.1% PASS Galt Sacramento Measure Q TrUT 1 cent $ 3,600,000 none 52.4% PASS Colton San Bernardino Measure S TrUT 1 cent $ 9,500,000 none 66.8% PASS Ontario San Bernardino Measure Q TrUT 1 cent $ 95,000,000 none 53.2% PASS Solana Beach San Diego Measure S TrUT 1 cent $ 3,000,000 none 66.7% PASS Brisbane San Mateo Measure U TrUT 1/2 cent $ 2,000,000 none 63.9% PASS Goleta Santa Barbara Measure B TrUT 1 cent $ 10,600,000 none 64.7% PASS Solvang Santa Barbara Measure U TrUT 1 cent $ 1,600,000 none 63.1% PASS
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Packet Pg. 199 Attachment: Fiscal and Program Effects of Initiative 21-0042A1 on Local Governments (Oppose Taxpayer Protection & Government – 7 – rev January 14, 2023
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Co-temporal Advisory Measures in 2022
At the November 2022 election, there was just one local general tax measure that was accompanied by an advisory measure as to the use of funds. The City of Santa Monica’s Measure DT property transfer tax failed with just 34 percent approval as voters instead chose the citizen initiative Measure GS.
There was also just one such tax use advisory measure on the June 2022 election. Susanville’s voters passed Measure P, a 1 percent transactions and use (sales) tax that generates $1.75 million per year5 for general city services. The measure was accompanied by advisory Measure Q, accompanied the city’s It asked, “If Measure P passes, should the revenues be used to balance the budget to maintain and enhance existing public safety services (police and fire), and provide funding to support street infrastructure improvements and provide funding to support economic development efforts designed to increase businesses, jobs and visitors to Susanville?” Both measures passed. Under Initiative 21-0042A1, the tax will expire a year after the effective date of the initiative (i.e., in December 2025).
1.b. Additional Costs and Public Service Effects of the Tax Provisions Assuming a similar volume of local measures through 2024 as we saw in 2022, there will be over 200 local measures that will need to be redrafted to comply with the Initiative and placed back on the ballot for the taxes to continue after December 2025. The costs of re-drafting, re-placing and re-voting on these measures, previously legally approved by voters, will be in the tens of millions in total statewide.
2. “Exempt Charges” (fees and charges that are not taxes) and Services Threatened With regard to fees and charges adopted after January 1, 2022, Initiative 21-0042A1:
Subjects new fees and charges for a product or service to a new "actual and reasonable test." Subjects fees and charges for entrance to local government property; and rental and sale of local government property to a new, undefined, “reasonable” test. Allows legal challenge to any tax adopted before the effective date of the initiative and after January 1, 5 The Susanville measure also did not include a specific end date and so is included in the list and totals of those measures.
Measures in 2022 with Non-Specific Durations
Agency Name County Tax/Fee Rate
Annual
Revenue Use Sunset YES%
Watsonville Santa Cruz Measure R TrUT 1/2 cent $ 5,000,000 none 64.4% PASS Vallejo Solano Measure P TrUT 7/8 cent $ 18,000,000 none 54.7% PASS Modesto Stanislaus Measure H TrUT 1 cent $ 39,000,000 none 62.8% PASS County of Colusa Measure A TrUT 2/3 1/2 cent $ 2,400,000 EMS none 69.4% PASS Atwater Merced Measure B TrUT 2/3 same 1 cent $ 4,000,000 police/fire none 73.7% PASS Truckee Nevada Measure U TrUT 2/3 by 1/4 cent to
1/2 cent $ 3,000,000 open space / trails none 76.4% PASS Palo Alto Santa Clara Measure L UtilityTransfer 18% gas $ 7,000,000 none 77.7% PASS Santa Clara Santa Clara Measure G UtilityTransfer 5 % $ 30,000,000 none 84.2% PASS Hercules Contra Costa Measure N UUT 8% $ 3,600,000 none 69.3% PASS Carson Los Angeles Measure UU UUT 2% electr, gas $ 8,000,000 none 78.4% PASS Sebastopol Sonoma Measure N UUT 3.75% (same) $ 700,000 none 83.5% PASS
9.7.d
Packet Pg. 200 Attachment: Fiscal and Program Effects of Initiative 21-0042A1 on Local Governments (Oppose Taxpayer Protection & Government – 8 – rev January 14, 2023
CaliforniaCityFinance.com
2022. Such a lawsuit could enjoin (stop) the enactment of the tax pending the outcome of the legal challenge.
Subjects a challenged fee to new, higher burdens of proof if legally challenged.
2.a. Value on New Local Government Fees and Charges at Risk6 Virtually every city, county, and special district must regularly (e.g., annually) adopt increases to fee rates and charges and revise rate schedules to accommodate new users and activities. Most of these would be subject to new standards and limitations under threat of legal challenge. Based on the current volume of fees and charges imposed by local agencies and increases in those fees simply to accommodate inflation, the amount of local government fee and charge revenue placed at risk is about $2 billion per year including those adopted since January 1, 2022. Of $2 billion, about $900 million (45 percent) is for special districts, $800 million (40 percent) is cities, and $300 million (15 percent) is counties.7 Major examples of affected fees and charges are:
1. Certain water, sanitary sewer, wastewater, garbage, electric, gas service fees.
2. Nuisance abatement charges - such as for weed, rubbish and general nuisance abatement to fund community safety, code enforcement, and neighborhood cleanup programs.
3. Emergency response fees - such as in connection with DUI.
4. Advanced Life Support (ALS) transport charges.
5. Business improvement district charges.
6. Fees for processing of land use and development applications such as plan check fees, use permits, design review, environmental assessment, plan amendment, subdivision map changes.
7. Document processing and duplication fees.
8. Facility use charges, parking fees, tolls.
9. Fines, penalties.
10. Fees for parks and recreation services.
2.b. Additional Costs and Public Service Effects of the Fee/Charge Provisions In addition to service delays and disruptions due to fee and charge revenues placed at greater legal risk, there would be substantial additional costs for legal defense. The risk to fees and charges will make infrastructure financing more difficult and will deter new residential and commercial development. ***********
mc
6 Source: California State Controller Annual Reports of Financial Transactions concerning cities, counties and special districts, summarized with an assumed growth due to fee rate increases (not population) of 2 percent annually. 7 School fees are also affected but the amount is negligible by comparison.
9.7.d
Packet Pg. 201 Attachment: Fiscal and Program Effects of Initiative 21-0042A1 on Local Governments (Oppose Taxpayer Protection & Government Correspondence
9.7.e
Packet Pg. 202 Attachment: Correspondence (Oppose Taxpayer Protection & Government Accountability Act) 1 Danielle Navarro
From: Danielle Navarro
Sent: Thursday, February 16, 2023 5:20 PM
To: Matt Rinn; Susan Noack; Tim Flaherty; Zac Shess
Cc: June Catalano; Juanita Davalos; Geoff Gillette; Janet Coleson; Ethan Bindernagel Subject: Taxpayer Protection and Government Accountability Act Attachments: SKM_80823021616551.pdf
Mayor Flaherty and Councilmembers,
Each of you received your own copy of the attached letter (this one is addressed to Mayor Flaherty) in the mail today.
Danielle
9.7.e
Packet Pg. 203 Attachment: Correspondence (Oppose Taxpayer Protection & Government Accountability Act)
9.7.e
Packet Pg. 204 Attachment: Correspondence (Oppose Taxpayer Protection & Government Accountability Act)
9.7.e
Packet Pg. 205 Attachment: Correspondence (Oppose Taxpayer Protection & Government Accountability Act)
CITY COUNCIL STAFF REPORT
Meeting Date: February 27, 2023
TO: THE HONORABLE MAYOR AND CITY COUNCILMEMBERS
SUBJECT: ADOPT RESOLUTION NO. ___-23 PROCLAIMING THE END OF THE
LOCAL STATE OF EMERGENCY IN THE CITY OF PLEASANT HILL
DUE TO THE COVID-19 PANDEMIC
SYNOPSIS
On March 23, 2020, the City Council adopted Resolution 22-20 ratifying the City Manager’s (acting as Director of Emergency Services), March 18, 2020 proclaimed local state of emergency due to the COVID-19 pandemic. On October 17, 2022, Governor Newsom’s office issued a press release stating that the State’s COVID-19 State of Emergency will terminate on February 28, 2023, and on February 7, 2023, the Contra Costa County Board of Supervisors adopted an order terminating the County’s COVID-19 State of Emergency. Staff recommends the City Council adopt a resolution proclaiming the end of the COVID-19 local emergency in Pleasant Hill effective 11:59 pm on February 28, 2023.
DISCUSSION
Background
On March 4, 2020, the Governor of the State of California proclaimed a State of Emergency to exist in California as a result of the threat of COVID-19; the Board of Supervisors of Contra Costa County adopted Resolution No. 2020/92 proclaiming that a local emergency exists throughout the County shortly thereafter; and the Contra Costa County Health Officer (and the health officers of five other Bay Area Counties) issued orders directing all individuals living in the counties to shelter at their place of residence with exceptions for essential services, activities, work and exemptions for people experiencing homelessness.
Section 3.45.040 of the City of Pleasant Hill Municipal Code establishes that the City Manager serves as the City’s Director of Emergency Services (“the Director”) and empowers the Director to proclaim the existence or threatened existence of a local emergency when the City Council is not in session. Taking into account the above facts, the City Manager, acting in her role of Director of Emergency Services, found that the efforts required to prepare for, respond to, mitigate, and recover from the increasing spread of COVID-19 imposed, and would continue to impose, extraordinary requirements and expenses on the City, requiring diversion of resources from day-to-day operations. In addition, she found that the conditions associated with the impacts of the COVID-19 outbreak were, or were likely to be, beyond the control of the services,
9.8 Packet Pg. 206
personnel, equipment, and facilities of the City.
As the City Council was not in session and could not immediately be called into session, on March 18, 2020, the City Manager determined that it was in the best interests of the City to proclaim the existence of a local emergency. The City Council adopted Resolution 22-20 ratifying the proclamation on March 23, 2020.
Analysis
On October 17, 2022, Governor Newsom’s office issued a press release (attached) stating that the State’s COVID-19 State of Emergency will terminate on February 28, 2023, and on February 7, 2023, the Contra Costa County Board of Supervisors adopted an order terminating the County’s COVID-19 State of Emergency (attached). Staff recommends the City Council adopt a resolution proclaiming the end of the COVID-19 local emergency in Pleasant Hill effective 11:59 pm on February 28, 2023. This action would ensure that the City of Pleasant Hill remains aligned with the State of California and Contra Costa County on COVID-19 emergency response.
The termination of the local state of emergency does not mean that the State will discontinue assistance to the City for cost recovery claims by CalOES for the period covered during the state of emergency. It is anticipated that the recovery process, as in most disasters, will continue for several years following conclusion of the state of emergency.
FISCAL IMPACT
No fiscal impact. The local emergency was declared to recognize the impact of COVID-19 on the City of Pleasant Hill, provide flexibility to the City in its response efforts, and to maintain eligibility for the City to pursue disaster relief funds to help cover costs related to the emergency response.
PUBLIC CONTACT
Public contact was made through posting of the City Council agenda on the City’s official notice bulletin board, at the Pleasant Hill Senior Center, and at the Pleasant Hill Police Department. The agenda and staff report are posted on the City’s web page.
RECOMMENDED CITY COUNCIL ACTION
Adopt the proposed resolution to terminating the local emergency.
ALTERNATIVES TO RECOMMENDED ACTION
The City Council could choose not to adopt the proposed resolution and provide direction to staff.
9.8 Packet Pg. 207
ATTACHMENT(S):
Proposed Resolution
Resolution 22-20
Proclamation of Local Emergency 2020-01
Governor's Press Release Ending the COVID-19 State of Emergency Contra Costa County COVID-19 Emergency Termination Board Order Prepared by: Danielle K. Navarro, Principal Management Analyst/City Clerk Approved by: June Catalano, City Manager
9.8 Packet Pg. 208
RESOLUTION NO. ___-23
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PLEASANT HILL
PROCLAIMING THE TERMINATION OF THE LOCAL STATE OF EMERGENCY DUE TO NOVEL CORONAVIRUS (“COVID-19”)
WHEREAS, the City Council adopted Resolution No. 22-20 confirming the existence of the local emergency due to COVID-19 in the City of Pleasant Hill proclaimed by the City’s Director of Emergency Services on March 18, 2020, and
WHEREAS, the Governor of the State of California issued a press release on October 17, 2022 stating that the State’s COVID-19 State of Emergency will terminate on February 28, 2023; and
WHEREAS, on February 7, 2023, the Contra Costa County (“County”) Board of Supervisors adopted an order terminating the County’s COVID-19 State of Emergency effective February 28, 2023; and
WHEREAS, the situation resulting from the described conditions of extreme peril is now deemed to be within the control of the normal protective services, personnel, equipment, and facilities of and within the City of Pleasant Hill.
NOW THEREFORE, the City Council of the City of Pleasant Hill, State of California, does hereby proclaim the termination of said local emergency.
ADOPTED by the City Council of the City of Pleasant Hill at a regular meeting held on the 27th day of February, 2023, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
___________________________________
TIMOTHY M. FLAHERTY, Mayor
ATTEST:
DANIELLE K. NAVARRO, City Clerk
9.8.a
Packet Pg. 209 Attachment: Proposed Resolution (Terminating Declared Emergency - COVID-19) RESOLUTION NO. 22-20
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PLEASANT HILL
CONFIRMING THE EXISTENCE OF A LOCAL STATE OF EMERGENCY DUE TO NOVEL CORONAVIRUS (" COVID-19")
WHEREAS, Section 3.45.040 ofthe City ofPleasant Hilt Municipal Code empowers the Director ofEmergency Services to request the City Council ofthe City ofPleasant Hill ("City Council") to proclaim the existence or threatened existence of a· 1ocal emergency ifthe City Council is not in session; and
WHEREAS, beginning on January 20, 2020, the World Health Organization (" WHO") declared the COVID-19 outbreak a public health emergency of international concern and on January 31, 2020, the U.S. Department ofHealth and Human Services declared a Public Health Emergency for the United States ofAmerica; and
WHEREAS, on March 4, 2020, the Governor ofthe State ofCalifornia proclaimed a State ofEmergency to exist in California as a result ofthe threat ofCOVID-19; and WHEREAS, on March 10, 2020, the Board ofSupervisors ofContra Costa County adopted Resolution No. 2020/92 proclaiming that a local emergency exists throughout the County; and WHEREAS, on March 16, 2020, to slow the spread ofCOVID-19 to the maximum extent possible, the Contra Costa County Health Officer and officers offive ( 5) other Bay Area Counties issued orders directing all individuals living in each county to shelter at their place ofresidence with exceptions for essential services, activities, and work and exemptions for people experiencing homelessness; and
WHEREAS, on March 18, 2020, the City's Director ofEmergency Services proclaimed attached) the existence of a local state ofemergency due to conditions ofextreme peril arising from COVID-19 in Pleasant Hill; and
WHEREAS, pursuant to Section 3.45.040 ofthe City ofPleasant Hill Municipal Code, whenever a local emergency is proclaimed by the City's Director ofEmergency Services, the City Council must take action to ratify the proclamation within seven ( 7) days ofits issuance or the proclamation shall have no further force or effect; and WHEREAS, the City Council does hereby find that the aforesaid conditions of extreme peril did warrant and necessitate the proclamation of the existence of a local emergency by the City's Director ofEmergency Services.
NOW, THEREFORE, BE IT RESOLVED, by the City Council ofthe City ofPleasant Hill, that:
1. a local emergency exists throughout the City ofPleasant Hill.
2. the local state of emergency shall be deemed to continue to exist until its termination is proclaimed by the City Council ofthe City ofPleasant Hill.
9.8.b
Packet Pg. 210 Attachment: Resolution 22-20 (Terminating Declared Emergency - COVID-19)
3. City staff is hereby authorized and directed to take any action that may be necessary or convenient to assist in obtaining federal, state or regional disaster or emergency relief funding ..
4. the City Manager or his or her designee is hereby designated as the authorized representative ofthe City ofPleasant Hill for the purpose ofreceipt, processing and coordination of all inquiries and requirements necessary to obtain county, state and federal relief assistance.
5. all City officers and employees shall continue to receive their regular rate ofpay through April 7, 2020.
6. the City Clerk shall forward a copy of this Resolution to the Governor, to the State Office ofEmergency Services, to the Contra Costa County Sheriff' s Office, and to all other appropriate county, state and federal agencies with an interest therein.
ADOPTED by the City Council of the City ofPleasant Hill at a special meeting held on the 23rd day ofMarch, 2020,'by the following vote: ·
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
Carlson,.Flaherty, Harris, Noack, Rinn
None
None
None
APPROVED AS TO FORM; .
NdET E. COLESON, City Attorney
CERTIFIED ATRUE COPY
9.8.b
Packet Pg. 211 Attachment: Resolution 22-20 (Terminating Declared Emergency - COVID-19) EMERGENCY PROCLAMATION NO. 2020- 01
A PROCLAMATION OF THE DIRECTOR OF EMERGENCY SERVICES OF THE CITY OF
PLEASANT HILL PROCLAIMING THE EXISTENCE OF A LOCAL STATE OF EMERGENCY DUE TO NOVEL CORONA VIRUS (" COVID- 19")
WHEREAS, the Federal Centers for Disease Control and Prevention (" CDC") has confirmed thousands ofcases ofindividuals who have severe respiratory illness caused by a novel corona virus known as COVID- 19, including deaths caused by this illness; and WHEREAS, beginning on January 20, 2020, the World Health Organization (" WHO") declared the outbreak of COVID- 19 a public health emergency ofinternational concern, and on January 31, 2020, the U.S. Department ofHealth and Human Services declared a Public HealthEmergency for.theUnited States ofAmerica; and
WHEREAS, on March 4, 2020, the Governor of the State of California proclaimed a State of Emergency to exist in California as a result of the threat of COVID- 19; and· WHEREAS, on March 10, 2020, the increase ofreported cases and deaths associated with COVID19 prompted the Board of Supervisors of Contra Costa County to adopt Resolution No. 2020/ 92 proclaiming that a local emergency exists throughout the County; and WHEREAS, on March 16, 2020, the Contra Costa County Health Officerissued an order directing all individuals living in the County to shelter at.their place ofresidence to slow the spread of COVID- 19 to the maximum extent feasiblewith exceptions foressential services, activities, and work and exemptions forpeople experiencing homelessness; and
WHEREAS, California Government Code Section 8630 and the Pleasant Hill Municipal Code section_ 3.45.010 empowers the City Manager, as the Director of Emergency Services, to proclaim the existence or threatened existence of a local emergency to protect the safety and welfare of the City; and WHEREAS, Section 3.45.040 of the City of Pleasant Hill Municipal Code empowers the Director of Emergency Services to request the City Council of the City of Pleasant Hill (" City Council") to proclaim the local emergency himself or herself ifthe City Council is not in session; and WHEREAS, the City Council is not in session; and
WHEREAS, the Director of Emergency Services has determined that conditions of extreme peril to the safety of persons and property have arisen within the City as a result of the COVID- 19, and a declaration will assist in a coordinated public health response to reduce transmission, assist health care providers, coordinate public services, and mitigate other effects of this emergency on the City.
WHEREAS, Government Code section 8630 generally requires the City Council to review the need forcontinuing the local emergency at least every sixty ( 60) days, but as part ofGovernor Gavin Newsom' s March 4, 2020 Declaration ofa State of Emergency in California due t0 COVID- 19, this provision has been waived forthe duration of the statewide emergency, allowing the City to maintain its emergency in place until terminated by the City Council. j;
9.8.b
Packet Pg. 212 Attachment: Resolution 22-20 (Terminating Declared Emergency - COVID-19)
9.8.b
Packet Pg. 213 Attachment: Resolution 22-20 (Terminating Declared Emergency - COVID-19) RECOMMENDATION(S):
TERMINATE, effective February 28, 2023, the local emergency throughout Contra Costa County proclaimed by the Board of Supervisors on March 10, 2020, due to the COVID-19 pandemic, consistent with the end of the statewide state of emergency.
FISCAL IMPACT:
No fiscal impact. The local emergency was declared to recognize the impact of COVID-19 on Contra Costa County, provide flexibility to the County in its response efforts and to maintain eligibility for the County, and its cities, to pursue disaster relief funds to help cover costs related to the emergency response. In October 2022, Governor Newsom announced that the State's COVID-19 state of emergency would be terminated as of February 28, 2023. This action would ensure that Contra Costa County continues to maintain alignment with the State of California on its COVID-19 emergency response posture.
APPROVE OTHER
RECOMMENDATION OF CNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE Action of Board On: 02/07/2023 APPROVED AS RECOMMENDED OTHER Clerks Notes:
VOTE OF SUPERVISORS
Contact: Timothy M. Ewell, (925)
655-2043
I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board of Supervisors on the date shown.
ATTESTED: February 7, 2023
, County Administrator and Clerk of the Board of Supervisors By: , Deputy
cc:
C.115
To: Board of Supervisors
From: Monica Nino, County Administrator
Date: February 7, 2023
Contra
Costa
County
Subject: TERMINATION OF LOCAL COVID-19 EMERGENCY DECLARATION
9.8.c
Packet Pg. 214 Attachment: Contra Costa County COVID-19 Emergency Termination Board Order (Terminating Declared Emergency - COVID-19) BACKGROUND:
On Tuesday, March 10, 2020, the Board of Supervisors declared a countywide emergency in response to the COVID-19 pandemic and subsequently requested that Governor Newsom include the County in the State's emergency declaration. (D. 3) Later that week, on Friday, March 13, 2020, President Trump declared a nationwide emergency in response to the growing COVID-19 pandemic pursuant to Sec. 501(b) of the Robert T.
Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. 5121-5207 (the “Stafford Act”). That action provided access to the Federal Emergency Management Agency (FEMA) Public Assistance program, which allows for a 75% federal cost share on certain emergency protective measures taken at the direction or guidance of public health officials in response to the COVID-19 pandemic. Later, the 75% federal cost share was increased to 100% for eligible costs through June 30, 2022.Qualifying expenditures are those that are not supported by the authorities of another federal agency (i.e. reimbursement for response activities funded by another federal agency grant program). Examples of reimbursable activities include the activation of Emergency Operations Centers, National Guard costs, law enforcement and other measures necessary to protect public health and safety.
The Governor's Office of Emergency Services (CalOES) facilitated the collection of FEMA Requests for Public Assistance (RPA) from agencies (public and private) impacted by the COVID-19 pandemic. CalOES advised that RPA documents, which do not include a specific dollar amount of public assistance being requested, be filed no later than April 17, 2020. Filing of this document allows agencies, including the County, to be on record stating that costs have been incurred as part of the response effort and allows for a request to FEMA that a portion of those costs be reimbursed in the future. In addition, CalOES requested that impacted agencies adopt required Project Assurances for federal Assistance and a resolution designating agents that can act on behalf of the impacted agency.
On March 31, 2020, the Board of Supervisors took action to adopt Resolution No. 2020/112 authorizing the County Administrator to submit the RPA documents discussed above to CalOES to ensure the opportunity for Federal cost reimbursement. The County subsequently filed its RPA with FEMA, which was approved on April 17, 2020 and serves as the basis for the County's FEMA reimbursement eligibility.
State Disaster Request and Presidential
Authorization
Following the President's action, Governor Newsom requested that the federal government declare a major disaster in California due to COVID-19. The President approved the State's request on Sunday, March 22, 2020, which activated additional federal resources directed to assist California, including deployment of mobile hospital units and a U.S. Navy hospital ship, among other things. Contra Costa County was a recipient of federal and state resources over the course of the pandemic, including mobile field hospital equipment, and took delivery of those resources at the Craneway Pavilion in Richmond, which served as a 250-bed alternate care site supporting the capacity of the County's hospital and clinic system. In addition, the state has provided for several COVID-19 testing centers strategically placed throughout the County.
County Reopening and Restoration of Procurement
Policies
On June 14, 2021, the County Administrator released reopening guidance for County departments following the Governor's termination of the “Stay At Home” order and retiring of the "Blueprint for a Safer Economy" both effective on June 15, 2021. This was to maintain continued County alignment with the State's COVID-19 response efforts. Specifically, department heads were provided guidance on face covering/workplace safety policies, emergency procurement procedures and restoration of employee travel. Most notably at the time, departments were directed to reopen lobbies of County facilities to the public.
9.8.c
Packet Pg. 215 Attachment: Contra Costa County COVID-19 Emergency Termination Board Order (Terminating Declared Emergency - COVID-19) In addition, the County Administrator authorized a two-phase restoration of pre-COVID procurement policies and procedures in recognition of ramp up time required to transition from an emergency procurement posture back to normal operations. Ultimately, full restoration of pre-COVID purchasing policies and procedures were effective October 31, 2021.
Announcement of Governor's Termination of
COVID-19 Emergency Declaration
On October 17, 2022, Governor Newsom announced that California's COVID-19 state of emergency would end on February 28, 2023. In a press release announcing the termination, the Governor's office stated that the lead time..."give(s) the health care system needed flexibility to handle any potential surge that may occur after the holidays in January and February, in addition to providing state and local partners the time needed to prepare for this phaseout and set themselves up for success afterwards." The termination of the state of emergency does not mean that the State will discontinue assistance to the County on its cost recovery claims by CalOES for the period covered during the state of emergency. It is anticipated that the recovery process, as in most disasters, will continue for several years following conclusion of the state of emergency.
Today's action requests that the Board of Supervisors terminate the local, County COVID-19 emergency declaration, consistent with termination with the statewide emergency declaration. The County Administrator's Office and the Health Services Department will continue to provide the Board with updates on the cost recovery and COVID-19 response transition process going forward.
CONSEQUENCE OF NEGATIVE ACTION:
The County's COVID-19 emergency declaration would remain in place even after the termination of the State of California's COVID-19 emergency declaration.
ATTACHMENTS
Press Release: Governor Newsom to End the COVID-19 State of Emergency, October 17, 2022
9.8.c
Packet Pg. 216 Attachment: Contra Costa County COVID-19 Emergency Termination Board Order (Terminating Declared Emergency - COVID-19) GovernorNewsomto End the COVID-19 State of
Emergency
Published: Oct 17, 2022
California’s pandemic response saved tens of thousands of lives, protected the economy, distributed nation-leading financial assistance and built up an unprecedented public health infrastructure
The SMARTER Plan will maintain California’s operational preparedness to support communities and quickly respond to outbreaks
SACRAMENTO – Today, Governor Gavin Newsom announced that the COVID-19 State of Emergency will end on February 28, 2023, charting the path to phasing out one of the most effective and necessary tools that California has used to combat COVID-19. This timeline gives the health care system needed flexibility to handle any potential surge that may occur after the holidays in January and February, in addition to providing state and local partners the time needed to prepare for this phaseout and set themselves up for success afterwards.
With hospitalizations and deaths dramatically reduced due to the state’s vaccination and public health efforts, California has the tools needed to continue fighting COVID-19 when the State of Emergency terminates at the end of February, including vaccines and boosters, testing, treatments and other mitigation measures like masking and indoor ventilation. As the State of Emergency is phased out, the SMARTER Plan continues to guide California’s strategy to best protect people from COVID-19.
SMARTER Plan progress update
“Throughout the pandemic, we’ve been guided by the science and data – moving quickly and strategically to save lives. The State of Emergency was an effective and necessary tool that we utilized to protect our state, and we wouldn’t have gotten to this point without it,” said Governor Newsom. “With the operational preparedness that we’ve built up and the measures that we’ll continue to employ moving forward, California is ready to phase out this tool.” To maintain California’s COVID-19 laboratory testing and therapeutics treatment capacity, the Newsom Administration will be seeking two statutory changes immediately upon the Legislature’s return: 1) The continued ability of nurses to dispense COVID-19 therapeutics; and 2) The continued ability of laboratory workers to solely process COVID-19 tests. “California’s response to the COVID-19 pandemic has prepared us for whatever comes next. As we move into this next phase, the infrastructure and processes we’ve invested in and built up will provide us the tools to manage any ups and downs in the future,” said Secretary of the California Health & Human Services Agency, Dr. Mark Ghaly. “While the threat of this virus is still real, our preparedness and collective work have helped turn this once crisis emergency into a manageable situation.”
Throughout the pandemic, Governor Newsom, the Legislature and state agencies have been guided by the science and data to best protect Californians and save lives – with a focus on those facing the greatest social and health inequities – remaining nimble to adapt mitigation efforts along the way as we learned more about COVID-19. The state’s efforts to support Californians resulted in:
Administration of 81 million vaccinations, distribution of a billion units of PPE throughout the state and processing of 186 million tests.
Allocation of billions of dollars to support hospitals, community organizations, frontline workers, schools and more throughout the pandemic.
The nation’s largest stimulus programs to support people hardest hit by the pandemic – $18.5 billion for direct payments to Californians, $8 billion for rent relief, $10 billion for small business grants and tax relief, $2.8 billion to help with overdue utility bills, and more.
9.8.d
Packet Pg. 217 Attachment: Governor's Press Release Ending the COVID-19 State of Emergency (Terminating Declared Emergency - COVID-19) California’s pandemic response efforts have saved tens of thousands of lives, kept people out of the hospital and protected the economy:
California’s death rate is the lowest amongst large states. If California had Texas’ death rate, 27,000 more people would have died here. If California had Florida’s rate, that figure jumps to approximately 56,000 more deaths.
In only the first ten months of vaccines being available, a study showed that California’s efforts saved 20,000 lives, kept 73,000 people out of the hospital and prevented 1.5 million infections.
California’s actions during the pandemic protected the economy and the state continues to lead the nation in creating jobs and new business starts:
“‘Lockdown’ states like California did better economically than ‘looser’ states like Florida, new COVID data shows,” with California’s economy having contracted less than such states – economic output shrank 3.5% on average for the U.S., compared with 2.8% for California.
Since February 2021, California has created 1,628,300 new jobs – over 16% of the nation’s jobs, by far more than any other state. By comparison, Texas created 1,133,200 jobs (11.3% of the nation’s) and Florida created 787,600 jobs (7.9% of the nation’s) in that same timeframe.
Since the beginning of 2019, data from the Bureau of Labor Statistics shows that over 569,000 businesses started in California, by far more than any other state. ###
9.8.d
Packet Pg. 218 Attachment: Governor's Press Release Ending the COVID-19 State of Emergency (Terminating Declared Emergency - COVID-19)