Agenda packet — Pleasanton City Council, January 20, 2026 (part 5 of 5)

6 Hutton Centre Drive, Suite 1200
Santa Ana, California 92707

REPORT ON INT

ERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND

OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN

ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Independent Auditor’s Report
To the Honor
able Mayor and the Members of the City Council
of the City of Pleasanton
Pleasanton, California
We have audited, in accordance with the auditing standard s generally accepted in the United States of America, the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States (“ Government Auditing Standards ”), the financial statements of the Alameda County Transportation Commission Measure BB Program (the “Program ”) of the City of Pleasanton, California (the “City”), as of and for the year ended June 30, 2025, and the related notes to the financial statements and have issued our report thereon dated December 22, 2025.

Report on Internal Control Over Financial Reporting
In planning and performing our audit of the financial stat ements, 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 opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s inte rnal 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 assi gned 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 City’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material wea knesses or significant deficiencies may exist that were not identified.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

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18 Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the fi nancial statements of the Program are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct a nd material effect on the fina ncial statements. However, providing an opinion on compliance with these provisions was not an objective of our aud it, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Purpose of This Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entit y’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Santa Ana, California
December 22, 2025

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6 Hutton Centre Drive, Suite 1200
Santa Ana, California 92707

REPORT ON COMPLI

ANCE AND

REPORT ON INTERNAL CONTROL OVER COMPLIANCE
Independent Auditor’s Report
To the Honor
able Mayor and the Members of the City Council
of the City of Pleasanton
Pleasanton, California
Report on Compliance or Alameda County Transportation Commission Measure BB Program Required by Alameda County Transportation Commission
Opinion On Alameda County Transportation Commission Measure BB Program We have audited the Alameda County Transportation Commiss ion Measure BB Program (the “Program”) of the City of Pleasanton, California’s (the “City”) compliance with the types of compliance requirements described in the agreement with the Alameda County Transportation Commission, dated July 1, 2016 (the “Agreement”) for the year ended June 30, 2025.

In our opinion, the City complied, in all material resp ects, with the types of compliance requirements referred to above that could have a direct and material effect on the City’s compliance with the Agreement for the year ended June 30, 2025.

Basis for Opinion on Alameda County Transportation Commission Measure BB Program We conducted our audit of compliance in accordance with a uditing standards generally accepted in the United States of America (“GAAS”); the standards applicable to financial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States (“ Government Auditing Standards ”); and the audit requirements of the Agreement. Our responsibilities under those standards and the Agreement are further described in the Auditor’s Responsibilities for the Audit of Compliance section of our report.

We are required to be indepe ndent of the City and to meet our other ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on comp liance for the Program. Our audit does not provide a legal determination of the City’s compliance with the compliance requirements referred to above.

Responsibilities of Management for Co
mpliance
Management is responsible for comp liance with the requirements referred to above and for the design, implementation, and maintenance of effective internal control over compliance with the requirements of laws, statutes, regulations, rules, and provisions of contracts or grant agreements applicable to the Program.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

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20 Auditor’s Responsibilities for the Audit of Compliance

Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above occurred, whether due to fraud or error, and express an opinion on the City’s compliance based on our audit. Reasonable assurance is a hi gh level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS, Government Auditing Standards, and the Agreement will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about the City’s compliance with the requirements of the Agreement as a whole.

In performing an audit in accordance with GAAS, Government Auditing Standards, and the Agreement, we

 exercise professional judgment and maintain professional skepticism throughout the audit.

 identify and assess the risks of material noncompliance, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the City’s compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances.

 obtain an understanding of the City’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstan ces and to test and report on internal control over compliance in accordance with the Agreement, but not for the pur pose of expressing an opinion on the effectiveness of the City’s internal control over compliance. Accordingly, no such opinion is expressed.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any significant deficienci es and material weaknesses in internal control over compliance that we identified during the audit.

Report on Internal Control Over Compliance

A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal c ourse of performing their assigned functions, to prevent, or detect and correct, noncompliance with a co mpliance requirement on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncomplian ce with a compliance requireme nt of the Agreement will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over co mpliance with a compliance requirement that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.

Our consideration of internal control over compliance was for the limited purpose d escribed in the Auditor’s Responsibilities for the Audit of Compliance section above and was not designe d to identify all deficiencies in internal control over compliance that might be material w eakness or significant deficienci es in internal control over compliance. Given these limitations, during our audit we did not identify a ny deficiencies in internal control over compliance t h
at we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies may exist that were not identified.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

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21 Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.

The purpose of this report on internal control over compliance is solely to describ e the scope of our testing on internal control over compliance and the results of that testing based on the requirements of the Agreement. Accordingly, this report is not suitable for any other purpose.

Santa Ana, California
December 22, 2025

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City of Pleasanton
Alameda County Transportation
Commission
Measure F Program

Pleasanton, California

Independent Auditor’s Reports
and Financial Statements

For the Year Ended June 30, 2025

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City of Pleasanton
Alameda County Transportation Commission
Measure F Program
For the Year Ended June 30, 2025

Table of Contents

Page

Independent Auditor’s Report on the Audit of Financial Statements ...................................................................... 1

Financial Statements:

Balance Sheet ............................................................................................................................................................ 7

Statement of Revenues, Expenditures, and Change in Fund Balance ....................................................................... 8

Notes to the Financial Statements ............................................................................................................................. 9

Independent Auditor’s Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ............................................................................................. 13

Independent Auditor’s Report on Compliance and Report on Internal Control Over Compliance ..................................................................................................................... 15

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6 Hutton Centre Drive, Suite 1200
Santa Ana, California 92707

INDEPENDENT AUDITOR’S REPORT

To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

Report on the Audit of the Financial Statements

Opinion

We have audited the financial stat ements of the City of Pleasanton Alameda County Transportation Commission Measure F Program (the “Program”) of the City of Pleasant on, California (the “City”) as of and for the year ended June 30, 2025, and the related notes to the financial statements, as listed in the table of contents.

In our opinion, the accompanying financial statements referre d to above present fairly, in all material respects, the financial position of the Program of the City, as of June 30, 2025, and the change in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audit in accordance with auditing standards generally accept ed 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 (“ Government Auditing Standards ”). Our responsibilities under those standards are further described in the Auditor’s Responsib ilities for the Audit of the Financial Statements section of our report. We are required to be inde pendent 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 opinion.

Emphasis of Matters

Financial Statements Presentation

As discussed in Note 1, the financia l statements present only the Program and do not purport to, and do not, present fairly the financial position of the City as of June 30, 2025, the changes in its financial position, or where applicable, its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter.

Responsibility of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of these 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.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

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2 Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whet her the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.

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.

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.

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

Required Supplementary Information

Management has omitted the management’s discussion and analysis that accoun ting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, although not a part of the basic financial statements, is required by th e Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the financial statements in an appropriate operational, economic, or historical context. Our opinions on the basic financial statements are not affected by this missing information.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

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3 Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards , we have also issued our repor t dated December 22, 2025, on our consideration of the City’s internal control over financia l reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control ove r financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over the financial reporting or on compliance. That report is an integral pa rt of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over the Program’s financial reporting and compliance.

Santa Ana, California
December 22, 2025

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FINANCIAL STATEMENTS
5

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6

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Vehicle
Registration Fees
Special Revenue
ASSETS Fund
Cash and investments 376,726$
Measure F Direct Local Distribution Program receivables 62,180 Interest receivables 1,833
Total assets 440,739

LIABILITIES AND FUND BALANCE
Liabilities:

Accounts payable 39,991
Total liabilities 39,991
Fund Balance:

Restricted for Measure F Programs and Projects 400,748
Total fund balance 400,748
Total liabilities and fund balance 440,739$
Alameda County Transportation Commission
Balance Sheet
June 30, 2025
City of Pleasanton
Measure F Program
See accompanying Notes to the Financial Statements.
7

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Vehicle
Registration Fees
Special Revenue
REVENUES: Fund
Direct Local Distribution Funds Allocation 360,131$
Investment earnings:

Interest and earnings on fair market value of investments 35,440 Total revenues 395,571
EXPENDITURES:

Measure F Direct Local Distribution Program Expenditures:

Measure F Capital Outlay 799,823 , Total expenditures 799,823
NET CHANGE IN FUND BALANCE (404,252)
FUND BALANCE:

Beginning of year 805,000
End of year 400,748$
City of Pleasanton
Statement of Revenues, Expenditures, and Change in Fund Balance For the Year Ended June 30, 2025
Alameda County Transportation Commission
Measure F Program
See accompanying Notes to the Financial Statements.
8

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City of Pleasanton
Alameda County Transportation Commission
Measure F Program
Notes to the Financial Statements
For the Year Ended June 30, 2025

9 Note 1 – The Reporting Entity

All transactions of the Alameda County Transportation Commission – Measure F Program (the “Program”) of the City of Pleasanton, California (the “City”), are reported in a separate special revenue fund in the basic financial statements of the City.

Measure F Program is restricted to repair and maintain local streets and roads; improve traffic flow and bicyclist, pedestrian and driver safety; improve public transportation; and encourage green transportation options.

The accompanying financial statements are for the Program only and are not intended to fairly present the financial position of the City or the results of its operations.

Note 2 – Summary of Significant Accounting Policies

A. Basis of Accounting

The accompanying financial statements present only the Program and are not intended to present the financial position, and changes in financial position of the City in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

The accounting policies of the Program are in accordance with U.S. GAAP a pplicable to governmental units. The Governmental Accounting Standards Board (“GASB”) is the accepted standard-setting body for establishing accounting and financial reporting principles.

The accompanying financial statements of special revenue funds are prepared based on the modified accrual basis of accounting. Measure F program revenues are generally r ecorded when measurable and available (generally 90 days after year-end), and expenditures are recorded when the related liabilities are incurred.

The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a “current financial resources” measurement focus, wherein only current assets and current liabilities generally are incl uded on the balance sheets. Operating statements of governmental funds present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets.

B. Description of Funds

The Program fund is Special Revenue Fund which is used to account for the proceeds of specific revenue sources that are restricted or committed to expenditure for speci fied purposes other than debt service or capital projects.

The Program accounts are maintained on the basis of fund accounting. A fund is a separate accounting entity with a self-balancing set of accounts.

The Program fund accounts for moneys received from voter-approved Measure F which is to be used for transportation priorities that includes the City’s Local Streets and Road Program’s Annual Street Resurfacing and Reconstruction Capital Improvement Project.

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City of Pleasanton
Alameda County Transportation Commission
Measure F Program
Notes to the Financial Statements (Continued)
For the Year Ended June 30, 2025

10 Note 2 – Summary of Significant Accounting Policies (Continued)

C. Cash and Investments

The Program’s cash is pooled with the City’s internal investment pool. The share of each fund in the pooled cash account was separately maintained and interest income was apportioned to the participating funds based on the relationship of their average daily cash balances to the total of the pooled cash and investments at the end of each quarter.

D. Receivables

All receivables are shown net of an allowance for uncollectible amounts.

E. Fund Balance

Measure F fund balance is restricted. A restricted fund balance represents amounts that can be spent only for specific purposes because of constitutional provisions or enabling legislation or because of constraints that are externally imposed by creditors, grantors, contributors, or the laws or regulations of other governments.

When expenditures are incurred for purposes for which both r estricted and unrestricted fund balance is available, the City considers restricted funds to have been spent first.

F. Use of Estimates

The preparation of financial statemen ts in accordance with U.S. GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

Note 3 – Cash and Investments

The Program's cash and investments are pooled with the C ity of Pleasanton in the amount of $376,726. Each Fund's share of the pooled cash account is separately accounted for, and investment income is allocated to all participating funds based on the relationship of their daily cash balances to the total of the pooled cash and investments at the end of each quarter. Information regarding the authorized types of deposits and investments, the type of risks (i.e. credit, interest rate, custodial, etc.) and other disclosures associated with the Program's pooled cash and investments is included in the City's basic financial statements , which are available at the City of Pleasanton at 123 Main Street, Pleasanton, California 94566 or on the City’s website at https://www.cityofpleasantonca.gov.

Note 4 – Measure F Direct Local Distribution Program Receivables

The Measure F Direct Local Distribution Program receivable represents vehicle registration fee revenues from Measure F for the fiscal year, received from the Alameda County Transportation Commission after June 30, 2025. The Program recorded a receivable of $62,180 related to these revenues as of June 30, 2025.

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City of Pleasanton
Alameda County Transportation Commission
Measure F Program
Notes to the Financial Statements (Continued)
For the Year Ended June 30, 2025

11 Note 5 – Commitments and Contingencies

The City participates in several grant programs. These programs may be subject to further examination by the grantors and the amount of expenditures, if any, which may be disallowed by the granti ng agencies, and cannot be determined at this time. The City expects such amounts, if any, to be immaterial.

Note 6 – Measure F Funds

Under the Measure F Alameda County Vehicle Registration Fee (“VRF”) Program, approved by the voters of Alameda County in November 2010, the City receives a portion of the proceeds of the $10 per year vehicle registration fee to be used for transportation related expenditures.

The goal of the VRF program is to sustain the County’s transportation network and reduce traffic congestion and vehicle related pollution. The program includes four categories of projects:

 Local Road Improvement and Repair Program (60 percent)  Transit for Congestion Relief Program (25 percent)
 Local Transportation Technology Program (10 percent)
 Pedestrian and Bicyclist Access and Safety Program (5 percent)

The Alameda County Transportation Commission will distribut e an equitable share of the funds among the four planning areas of the County over successive five-year cycles . Geographic equity will be measured by a formula, weighted 50 percent by population of the planning area and 50 percent of registered vehicles of the planning area.

Measure F funds are currently budgeted for the City’s Lo cal Streets and Road Program’s Annual Street Resurfacing and Reconstruction Capital Improvement Project. There were Measure F expenditures for this project during the fiscal year and the project was still in progress at fiscal year-end. The City will utilize Measure F funding in Fiscal Year 2025/26 to complete the project.

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6 Hutton Centre Drive, Suite 1200
Santa Ana, California 92707

REPORT ON INT

ERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND

OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN

ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Independent Auditor’s Report
To the Honor
able Mayor and the Members of the City Council
of the City of Pleasanton
Pleasanton, California
We have audited, in accordance with the auditing standard s generally accepted in the United States of America, the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States (“ Government Auditing Standards ”), the financial statements of the Alameda County Transportation Commission Measure F Program (the “Program”) of the City of Pleasanton, California (the “City”), as of and for the year ended June 30, 2025, and the related notes to the financial statements, and have issued our report thereon dated December 22, 2025.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

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14 Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the fi nancial statements of the Program are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct a nd material effect on the fina ncial statements. However, providing an opinion on compliance with these provisions was not an objective of our aud it, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Santa Ana, California
December 22, 2025

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6 Hutton Centre Drive, Suite 1200
Santa Ana, California 92707

REPORT ON COMPLI
ANCE

AND REPORT ON INTERNAL CONTROL OVER COMPLIANCE
Independent Auditor’s Report
To the Honor
able Mayor and the Members of the City Council
of the City of Pleasanton
Pleasanton, California
Report on Compliance for Alameda County Transpor tation Commission Measure F Program Required by Alameda County Transportation Commission
Opinion on Alameda County Transportation Commission Measure F Program We have audited the Alameda County Transportation Commission Measure F Program (the “Program”) of the City of Pleasanton, California’s (the “City”) compliance with th e types of compliance requirements described in the agreement with the Alameda County Transportation Commission, dated July 1, 2016 (the “Agreement”) for the year ended June 30, 2025.

Basis for Opinion on Alameda County Transportation Commission Measure F Program We conducted our audit of compliance in accordance with a uditing standards generally accepted in the United States of America (“GAAS”); the standards applicable to financial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States (“ Government Auditing Standards ”); and the audit requirements of the Agreement. Our responsibilities under those standards and the Agreement are further described in the Auditor’s Responsibilities for the Audit of Compliance section of our report.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

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16 Auditor’s Responsibilities for the Audit of Compliance

In performing an audit in accordance with GAAS, Government Auditing Standards, and the Agreement, we

 exercise professional judgment and maintain professional skepticism throughout the audit.

Report on Internal Control Over Compliance

Our consideration of internal control over compliance was for the limited purpose d escribed in the Auditor’s Responsibilities for the Audit of Compliance section above and was not designe d to identify all deficiencies in internal control over compliance that might be material w eakness or significant deficienci es in internal control over compliance. Given these limitations, during our audit we did not identify a ny deficiencies in internal control over
compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies may exist that were not identified.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

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17 Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.

Santa Ana, California
December 22, 2025

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City of Pleasanton

Pleasanton, California

Single Audit and
Independent Auditor’s Reports

For the Year Ended June 30, 2025

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City of Pleasanton
Single Audit and Independent Auditor’s Reports
For the Year Ended June 30, 2025

Table of Contents

Page

Independent Auditor’s Reports:

Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ...................................................................... 1

Report on Compliance for Each Major Federal Program;
Report on Internal Control Over Compliance; and Report on the Schedule of Expenditures of Federal Awards Required by the Uniform Guidance ....................................................... 3

Schedule of Expenditures of Federal Awards .................................................................................... ........................... 7

Notes to the Schedule of Expenditures of Federal Awards ........................................................................................... 8

Schedule of Findings and Questioned Costs ................................................................................................................. 9

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6 Hutton Centre Drive, Suite 1200
Santa Ana, California 92707

REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND

OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN

ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

Independent Auditor’s Report

To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

We have audited, in accordance with the auditing standa rds 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 (“ Government Auditing Standards ”), the financial statemen ts of the governmental activities, the business-type activities, each major fund, and th e aggregate remaining fund information of the City of Pleasanton, California (the “City”), as of and for the year ended June 30, 2025, and the re lated notes to the financial statements, which collectively comprise the City’s basic financial statements, and have issued our report thereon dated December 30, 2025.

Report on Internal Control Over Financial Reporting

In planning and performing our audit of the financial stat ements, 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. Acco rdingly, we do no t 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 assi gned 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 significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. 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 or significant deficiencies may exist that were not identified.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

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2 Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions w as not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Santa Ana, California
December 30, 2025

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6 Hutton Centre Drive, Suite 1200
Santa Ana, California 92707

REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM;
REPORT ON INTERNAL CONTROL OVER COMPLIANCE; AND REPORT ON THE

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS REQUIRED BY THE UNIFORM GUIDANCE

Independent Auditor’s Report

To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

Report on Compliance for Each Major Federal Program

Opinion on Each Major Federal Program

We have audited the City of Pleasanton, California’s (the “City”) compliance with the types of compliance requirements identified as subject to audit in the OMB Compliance Supplement that could have a direct and material effect on each of the City’s major federal programs for th e year ended June 30, 2025. The City’s major federal programs are identified in the summary of the auditor’s results section of the accompanying Schedule of Findings and Questioned Costs.

In our opinion, the City complied, in all material respect s, with the compliance require ments referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2025.

Basis for Opinion on Each Major Federal Program

We conducted our audit of compliance in accordance with a uditing standards generally accepted in the United States of America (“GAAS”); the standards appli cable to financial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States (“Government Auditing Standards ”), and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (“Uniform Guidance”). Our responsibilities under those standards and the Uniform Guidance are further described in the Auditor’s Responsibilities for the Audit of Compliance section of our report.

We are required to be indepe ndent of the City and to meet our other ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We be lieve that the audit evidence we have obtained is sufficient and appropriate to provide a basis fo r our opinion on compliance for each major federal program. Our audit does not provide a legal determination of City’s compliance with the compliance requirements referred to above.

Responsibilities of Management for Compliance

Management is responsible for comp liance with the requirements referred to above and for the design, implementation, and maintenance of effective internal control over compliance with the requirements of laws, statutes, regulations, rules, and provisions of contracts or grant agreements applicable to City’s federal programs.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

Page 2 ends

4 Auditor’s Responsibilities for the Audit of Compliance

Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above occurred, whether due to fraud or error, and express an opinion on the City’s compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS, Government Auditing Standards, and the Uniform Guidance will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is considered material, if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about the City’s compliance with the requirements of each major federal program as a whole.

In performing an audit in accordance with GAAS, Government Auditing Standards, and the Uniform Guidance, we

• exercise professional judgment and maintain professional skepticism throughout the audit.

• identify and assess the risks of material noncompliance, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the City’s compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances.

• obtain an understanding of the City’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstan ces and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control over compliance. Accordingly, no such opinion is expressed.

Report on Internal Control Over Compliance

A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal c ourse of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of complian ce requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combinati on of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet im portant enough to merit attention by those charged with governance.

Our consideration of internal control over compliance was for the limited purpose d escribed in the Auditor’s Responsibilities for the Audit of Compliance section above and was not designe d to identify all deficiencies in internal control over compliance that might be material weaknesses or signi ficant deficiencies in internal control over compliance. Given these limitations, duri ng our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above . However, material weaknesses o r
significant deficiencies in internal control over compliance may exist that were not identified.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

Page 3 ends

5 Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.

The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance.

Accordingly, this report is not suitable for any other purpose.

Report on the Schedule of Expenditures of Federal Awards Required by the Uniform Guidance We have audited the financial statements of the governmental activiti es, the business-type activities, each major fund, and the aggregate remaining fund informa tion of the City as of and for the year ended June 30, 2025, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements. We issued our report thereon dated December 30, 2025, which contained unmodified opinions on those fi nancial statements. Our audit was conducted for the purpose of forming opinions on th e financial statements that collectively comprise the basic financial statements. The accompanying Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by Uniform Guidance and is 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 financ ial statements. The informa tion has been subjected to the auditing procedures applied in the audit of the basic financial statements and cer tain additional procedures, including comparing and reconciling such information direc tly to the underlying accounting and other records used to prepare the basic financial statements or to the basic fina ncial statements themselves, and other additional procedures in accordance with GAAS. In our opinion, the Schedule of Expenditure of Fede ral Awards is fairly stated in all material respects in relation to the basic financial statements as a whole.

Santa Ana, California
December 30, 2025

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City of Pleasanton
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2025
See accompanying Notes to the Schedule of Expenditures of Federal Awards. 7 Assistance
Federal Grantor/Pass-Through Grantor Listing Grant Federal Expenditures Program Title Number Identification Number Expenditures to Subrecipients U.S. De partment of Housing and Urban Development
Direct Programs:

Community Development Block Grant Cluster Entitlement/Special Purpose Grants:

Community Development Block Grants / Entitlement Grants 14.218 B-24-MC-06-0050 $ 342,042 $ 193,967 Total Community Development Block Grants Cluster Entitlements/Special Purpose Grants 342,042 193,967 Pass-through the County of Alameda:

HOME Investment Partnerships Program 14.239 M24-DC-060001 103,292 95,083 Total HOME Investment Partnerships Program 103,292 95,083 Total U.S. Department of Housing and Urban Developme nt 445,334 289,050 U.S. Department of Justice
Direct Programs:

Bulletproof Vest Partnership Program 16.607 BA-3A00S-SX02 11,496 - Total Bulletproof Vest Partnership Program 11,496 - Total U.S. Department of Justice 11,496 -
U.S. Department of Transportation
Pass-through the State of California, Office of Traffic Safety:

Highway Safety Cluster:

State and Community Highway Safety 20.600 PT25210 23,182 - State and Community Highway Safety 20.600 PT24149 6,416 - Total State and Community Highway Safety 29,598 - National Priority Safety Programs 20.616 TR24021 39,100 - Total Highway Safety Cluster 68,698 -
Minimum Penalties for Repeat Offenders for Driving While Intoxicated 20.608 PT25210 9,024 - Minimum Penalties for Repeat Offenders for Driving While Intoxicated 20.608 PT24149 801 Total Minimum Penalties for Repeat Offenders for Driving While Intoxicated 9,825 - Total U.S. Department of Transportation 78,523 -
U.S. Department of Energy
Direct Programs:

Energy Efficiency and Conservation Block Grant Program (EECBG) 81.128 IA-0000000763 140,450 - Total Energy Efficiency and Conservation Block Grant Program (EECBG) 140,450 - Total U.S. Department of Energy 140,450 -
U.S. Department of Homeland Security
Pass-through the California Governor's Office of Emergency Services:

Disaster Grants - Public Assistance (Presidentially Declared Disasters) 97.036 FEMA-4683-DR-CA 779,000 - Total Disaster Grants - Public Assistance (Presidentially Declared Disasters) 779,000 - Total U.S. Department of Home land Security 779,000 - Total Expenditures of Federal Awards 1,454,803$ 289,050$

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City of Pleasanton
Notes to the Schedule of Expenditures of Federal Awards For the Year Ended June 30, 2025

8 Note 1 – Reporting Entity

The financial reporting entity, as defined by the Governme ntal Accounting Standards Board (“GASB”) Codification, consists of the primary government, whic h is the City of Pleasanton, California (the “City”), organizations for which the primary government is financially accountable, and other organizations fo r which the nature and significance of their relationship with the primary government are such that exclusion would cause the City ’s financial statements to be misleading or incomplete.

The City Council acts as the governing body and is able to impose its will on the following organizations, establishing financial accountability:

• The Pleasanton Joint Powers Financing Authority
• The Pleasanton Public Housing Authority

Note 2 – Summary of Significant Accounting Policies

Basis of Accounting

Funds received under the various grant programs have been recorded within special revenue funds and enterprise funds of the City. The City utilizes the modified accrual b asis of accounting for special revenue funds and the accrual basis of accounting for the enterprise funds. The accompanying Schedule of E xpenditures of Federal Awards (the “Schedule”) is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (“CFR”) Part 200, Uniform Administrative Requirements, Cost Prin ciples, and Audit Requirements for Federal Awards (the “Uniform Guidance”). Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in, the preparation of City’s basic financial statements.

Schedule of Expenditures of Federal Awards

The accompanying Schedule presents the activity of all fe deral financial assistance programs of the City. Federal financial assistance received directly from federal agencies, as well as federal financial assistance passed through the County of Alameda, the State of California Office of Traffic Safety, and the California Governor’s Office of Emergency Services, are included in the Schedule. The Schedule was prepared from only the accounts of various grant programs and, therefore, does not present the financial position or results of operations of the City.

Indirect Cost Rate

The City did not elect to use the 10% de minimis cost rate.

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City of Pleasanton
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2025

9 Section I – Summary of Auditor’s Results

Financial Statements

Types of report the auditor issued on whether the financial statements audited were prepared in accordance with GAAP: Unmodified

Internal control over financial reporting:

• Material weakness(es) identified? No

• Significant deficiency(ies) identified? None Reported

Noncompliance material to financial statements noted? No

Federal Awards

Internal control over major federal programs:

• Material weakness(es) identified? No

• Significant deficiency(ies) identified? None Reported

Type of auditor’s report issued on compliance for major federal programs: Unmodified

Any audit findings disclosed that are required to be reported in accordance with 2 CFR 200.516(a)? No

Identification of major federal programs:

Assistance Listing Federal
Numbers Major Program or Cluster Expenditures

97.036 Disaster Grants - Public Assistance (Presidentially Declared Disasters) 779,000$ Total Expenditures of All Major Federal Programs 779,000$ Total Expenditures of Federal Awards 1,454,803$
Pe rce nt of Total Expe nditure s of Fe de ral Awards 53.55%

Dollar threshold used to distinguish between type A and type B programs: $750,000

Auditee qualified as a low-risk auditee in accordance with 2 CFR 200.520? Yes

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City of Pleasanton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2025

10 Section II – Financial Statement Findings

A. Current Year Findings – Financial Statement

No current year findings were noted.

B. Prior Year Findings – Financial Statement

2024-001 – Internal Control Over Financial Reporting – Prior Year Adjustments

Condition:

The City previously reported unavailable revenue in certain governmental funds to defer long-term loans receivable rather than reporting the balance as restricted fund balance while the proceeds from the collection of these receivables is restricted in accordance with Governmental A ccounting Standard Board Statement (“GASBS”) No. 54 – Fund Balance Reporting and Governmental Fund Type Definitions.

In addition, the City did not report the financed-pur chase assets and the associated liabilities in accordance with GASBS No. 87 – Leases.

Lastly, the City had reported the claims payable for its cu stodial funds instead of only reporting a liability when a demand for the resources has been made or when no further action, approval, or condition is required to be taken or met by the beneficiary to release the assets in accordance with GASBS No. 84 – Fiduciary Activities.

Recommendation:

We recommended the City conduct more thorough review of new GASB Statements and related GASB implementation guide to prevent differences in interpretation that resulted in improper financial reporting.

Status:

Finding was resolved during the year ended June 30, 2025.

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City of Pleasanton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2025

11 Section III – Federal Award Findings and Questioned Costs

A. Current Year Findings and Questioned Co sts – Major Federal Award Program Audit

No current year findings were noted.

B. Prior Year Findings and Questioned Costs – Major Federal Award Program Audit

No prior year findings were noted.

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City of Pleasanton

Pleasanton, California

Independent Accountant’s Report on
Applying Agreed-Upon Procedures to
Appropriations Limit Schedule

For the Year Ending June 30, 2026

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6 Hutton Centre Drive, Suite 1200
Santa Ana, California 92707

INDEPENDENT ACCOUNTANT’S REPORT ON

APPLYING AGREED-UPON PROCEDURES

To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

We have performed the procedures enumerated below on the accompanying Appropriations Limit Schedule of the City of Pleasanton, California (the “City”) for the year e nding June 30, 2026. The City’s management is responsible for the Appropriations Limit Schedule.

The City has agreed to and acknowledged that the procedures performed are appropriate to meet the intended purpose of meeting the requirements set forth in Section 1.5 of Article XIII B of the California Constitution. These procedures, which were suggested by the League of California Cities and presented in the publication entitled Agreed- upon Procedures Applied to the Appropriations Limitation Prescribed by Article XIII B of the California Constitution, were performed solely to assist you in meeting the require ments. This report may not be suitable for any other purpose. The procedures performed may not address all the items of interest to a user of this report and may not meet the needs of all users of this report and, as such, user s are responsible for determining whether the procedures performed are appropriate for their purposes.

The procedures and associated findings are as follows:

1. We obtained the completed worksheets used by the City to calculate its appropriations limit for the year ending June 30, 2026, and verified that the limit and annual calculation factors were adopted by resolution of the City Council. We also verified that the population and inflation options were selected by a recorded vote of the City Council.

Findings: No exceptions were noted as a result of our procedures.

2. For the accompanying Appropriations Limit Schedule, we added the prior year’s limit to the total adjustments, and agreed the resulting amount to the current year’s limit.

Findings: No exceptions were noted as a result of our procedures.

3. We compared the current year information presented in the accompanying Appropria tions Limit Schedule to corresponding information in worksheets used by the City.

Findings: No exceptions were noted as a result of our procedures.

4. We compared the appropriations limit presented in the accompanying Appropriations Limit Schedule matched the appropriation limit adopted by the City Council.

Findings: No exceptions were noted as a result of our procedures.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

Page 2 ends

2 We were engaged by the City to perfo rm this agreed-upon procedures engageme nt and conducted our engagement in accordance with attestation standards established by the American Institute of Certified Public Accountants. We were not engaged to and did not conduct an examination or review engagement, the objective of which would be the expression of an opinion or conclusion, respectively, on the accompanying Appropriations Limit Schedule.

Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you.

We are required to be independent of the City and to m eet our other ethical responsibilities, in accordance with the relevant ethical requirements related to our agreed-upon procedures engagement.

This report is intended solely for the information and use of the City Council and the management of the City and is not intended to be and should not be used by anyone other than these specified parties.

Santa Ana, California
December 22, 2025

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City of Pleasanton
Appropriations Limit Schedule
For the Year Ending June 30, 2026

See accompanying Notes to the Appropriations Limit Schedule. 3 Amount Source
A. Appropriations Limit FY 2024-2025 842,481,359 $ Prior year appropriation limit adopted by the City
B. Calculation Factors:
1) Population increase % 1.0031 California Department of Finance 2) Inflation increase % 1.0644 California Department of Finance 3) Total adjustment % 1.0677 (B1 x B2) C. Annual Adjustment Increase 57,035,685 {(B3-1) x A} D. Other Adjustments:
1) Loss responsibility (-) - N/A 2) Transfer to private (-) - N/A 3) Transfer to fees (-) - N/A 4) Assumed responsibility (+) - N/A E. Total Adjustments 57,035,685 (C+D) F. Appropriations Limit FY 2025-2026 899,517,044 $ (A+E)

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City of Pleasanton
Notes to the Appropriations Limit Schedule
For the Year Ending June 30, 2026

4 Note 1 – Purpose of Limited Procedures Review

Under Article XIII B of the California Constitution (t he Gann Spending Limitation Initiative), California governmental agencies are restricted as to the amount of an nual appropriations from proceeds of taxes. Effective for years beginning on or after July 1, 1990, under Section 1.5 of Article XIII B, the annual calculation of the appropriations limit is subject to an agreed upon procedures review in connection with the annual audit.

Note 2 – Method of Calculation

Under Section 10.5 of Article XIII B, for fiscal years begi nning on or after July 1990, the appropriations limit is required to be calculated based on the limit for the fiscal year 1986-87, adjusted for the inflation and population factors discussed in Notes 3 and 4 below.

Note 3 – Population Factors

A California governmental agency may use as its population factor either the annual percentage change of the jurisdiction’s own population or the annual percentage ch ange in population of the county where the jurisdiction is located. The factor adopted by the City for the year ending June 30, 2026, represents the annual percentage change in population for the County of Alameda.

Note 4 – Inflation Factors

A California governmental agency may use as its inflation factor either the annual percentage change in the 4 th
quarter per capita personal income (whi ch percentage is supplied by the Califor nia Department of Finance) or the percentage change in the local assess ment roll from the preceding year due to the change of local nonresidential construction. The factor adopted by the City for the year ending June 30, 2026, represents the annual percentage change for per capita personal income.

Note 5 – Other Adjustments

A California government agency may be required to adjust its appropriations limit when certain events occur, such as the transfer of responsibility for municipal serv ices to, or from, another government agency or private entity. The City had no such adjustments for the year ending June 30, 2026.

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6 Hutton Centre Drive, Suite 1200
Santa Ana, California 92707

December 30, 2025

To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

We have audited the financial statements of the governmental activiti es, the business-type activities, each major fund, and the aggregate remaining fund informa tion of the City of Pleasanton, California (the “City”) for the year ended June 30, 2025. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards and Government Auditing Standards , as well as certain information related to the planned scope and timing of our a udit. We have communicated such info rmation in our letter to you dated June 9, 2025. Professional standards also require that we communicate to you the following information related to our audit.

Significant Audit Matters

Qualitative Aspects of Accounting Practices

Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in Note 1 to the basic financial statements.

New Accounting Standards

GASB Statement No. 101 – In June 2022, 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 certa in previously required disclosures. Implementation of this Statement results in a restatement of the beginning net position as of July 1, 2024, as presented in Note 15 to the City’s Basic Financial Statements.

GASB Statement No. 102 – In December 2023, GASB issued Statement No. 102, Certain Risk Disclosures.

The objective of this Statement is to provide users of government financial statements with essential information about risks related to a government's vulnerabilities due to certa in concentrations or constraints which may limit a government's ability to acquire resources or control spending. Application of this statement did not have a significant effect on the City’s financial reporting for the fiscal year ended June 30, 2025.

No other new accounting policies were adopted and the app lication of existing policies was not changed during 2025.

We noted no transactions entered into by the City during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period.

Accounting estimates are an integral part of the financ ial statements prepared by management and are based on management’s knowledge and experience about past and current events and assum ptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financia l statements and because of the possibility that future events affecting them may differ significantly from those expected.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

Page 2 ends

The most sensitive estimates affecting the City’s financial statements were:

 Management’s estimate of the investment fair market value is based on information provided by The Bank of New York Mellon Trust Company (“BNY Mellon”), the custodial of the investments. We evaluated the key factors and assumptions used to develop the investment fair market value in determining that it is reasonable in relation to the financial statements taken as a whole.

 Management’s estimate of the depreciation and amortization on capital assets is based on the industry standard and past experience on actual useful life of the asset groups. We evaluated the key factors and assumptions used to develop the depreciation and amor tization on capital assets in determining that it is reasonable in relation to the financial statements taken as a whole.

 Management’s estimate of the net pension liability is based on the actuarial valuation on total pension liability and based on financial statements on fiduciary net position for CalPERS plans. We evaluated the key factors and assumptions used to develop th e net pension liability in determining that it is reasonable in relation to the financial statements taken as a whole.

 Management’s estimate of the net other postemploym ent benefits (“OPEB”) liability is based on the actuarial valuation on total OPEB liability and fi nancial statements on fi duciary net position. We evaluated the key factors and assumptions used to deve lop the OPEB liability in determining that it is reasonable in relation to the financial statements taken as a whole.

 Management’s estimate of comp ensated absences is based on th e City’s adopted methodology, consistent with the provisions of GASB 101. We evaluated the key factors and assumptions used to estimate the compensated absences liabilities determining that it is r easonable in relation to the financial statements taken as a whole.

Certain financial statement disclosures are particularly sensitive because of their significance to financial statement users. The most sensitive disclosures affecting the financial statements were:

 Note 1 – Summary of Significant Accounting Policies
 Note 2 – Stewardship, Compliance, and Accountability
 Note 10 – Membership in Insurance, Investment in Joint Ventures, and Jointly Governed Organization  Note 11 – Fund Balances
 Note 12 – Defined Benefit Pension Plan
 Note 13 – Post-Employment Health Care Benefits
 Note 14 – Commitments and Contingencies
 Note 15 – Changes to or within the Financial Reporting Entity and Restatements

The financial statement disclosures are neutral, consistent, and clear.

Difficulties Encountered in Performing the Audit

We encountered no significant difficulties in dealing with management in performing and completing our audit.

Corrected and Uncorrected Misstatements

Professional standards require us to accumu late all known and likely misstatements identified during the audit, other than those that are clearly trivial, and communicate them to the appropriate level of management. Management has corrected all such misstatements. In addition, none of th e misstatements detected as a result of audit procedures and corrected by management were material, either individually or in the aggregate, to each opinion unit’s financial statements taken as a whole.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

Page 3 ends

Disagreements with Management

For purposes of this letter, a disagreement with management is a financial accounting, repo rting, or auditing matter, whether or not resolved to our satisfaction, that could be si gnificant to the financial statements or the auditor’s report.

We are pleased to report that no such disagreements arose during the course of our audit.

Management Representations

We have requested certain representations from management that are included in the management representation letter dated December 30, 2025.

Management Consultations with Other Independent Accountants

In some cases, management may decide to consult with other acc ountants about auditing and accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation involves application of an accounting principle to the City’s financial statements or a determina tion of the type of auditor’s opinion that may be expressed on those statements, our professional standards require the c onsulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants.

Other Audit Findings or Issues

We generally discuss a variety of matters, including the a pplication of accounting principles and auditing standards, with management each year prior to retention as the C ity’s auditors. However, th ese discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention.

Other Matters

We applied certain limited procedures to the Manage ment’s Discussion and Analysis (“MD&A”), Budgetary Comparison Schedules, the Schedules of Changes in Net Pe nsion Liability and Related Ratios, the Schedule of the Proportionate Share of Net Pension Liability and Related Ratios, the Schedules of Contributions – Pensions, the Schedules of Changes in Net Other Postemployment Benefits Liability and Related Ratios, and the Schedules of Contributions – Other Postemployment Benefits, which are required supple mentary information (“RSI”) that supplements the basic financial statements. Our procedur es consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other know ledge we obtained during our audit of the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI.

We were engaged to report on the Combining and Individual Fund Financial Statements, which accompany the financial statements but are not RSI. With respect to this supplementary information, we made certain inquiries of management and evaluated the form, c ontent, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and r econciled the supplementary in formation to the underlying accounting records used to prepare the financial statements or to the financial statements themselves.

We were not engaged to report on the Introductory and the Statistical Sections, which accompany the financial statements but are not RSI. Such inform ation has not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on it.

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To the Honorable Mayor and the Members of the City Council of the City of Pleasanton
Pleasanton, California

Page 4 ends

Restriction on Use
This information is intende
d solely for the information and use of the City Council and management of the City and is not intended to be, and should not be, used by anyone other than these specified parties.

Very truly yours,
Santa Ana, California

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POPULAR ANNUAL FINANCIAL POPULAR ANNUAL FINANCIAL

REPORT FOR FISCAL YEAR REPORT FOR FISCAL YEAR
ENDED JUNE 30, 2025 ENDED JUNE 30, 2025

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CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024

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CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024

TABLE OF CONTENTS
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 GFOA Award for Oustanding Achievement in Popular Annual Financial Reporting . . . . . . . . . . . . . . . 3 Meet the City Council . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Community Profile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Types of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Governmental Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Enterprise Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Fund Balances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Long Term Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Pension Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Other Post Employment Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

GLOSSARY OF TERMS
Here is a quick reference to some terms used in the report:

Assets - Property or equipment that has a monetary value .

Deferred Outflows of Resources - A consumption of net assets that applies to future periods .

Deferred Inflows of Resources - An acquisition of net assets that applies to future periods .

Fiscal Year - A one year period that the City used for accounting purposes and preparing financial report .

The fiscal year for the City begins on July 1 of every year and ends on June 30 . The City issues its annual financial reports at the end of each calendar year .

Fund - A method to account financial transactions that are for a specific purpose .

Liability - A legal monetary obligation .

Other Assets - Cash, investments, and money owed to the City .

Public Entity - A state or local government, as well as any agency, office, or department run by a state or local government .

CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2025

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2 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024

INTRODUCTION
Pleasanton’s Popular Annual Financial Report contains financial highlights for the City of Pleasanton . The information has been presented in an easy to read format that simplifies complex data and avoids financial jargon . The City of Pleasanton is a General Law city with a Council-Manager form of government . The Mayor and City Council are elected officials that represent the will of Pleasanton residents and businesses . The City Manager and staff provide operations and management of services and facilities provided by the City . The City adopts a biennial Operating Budget and a five year Capital Improvement Plan in odd number years . For more information on the City’s various financial reports and information please visit the Finance page on City’s website located at www.cityofpleasantonca.gov .

Pleasanton is a thriving community that has something to offer everyone . From golf courses, major employers, prosperous vineyards and large community parks and recreation areas to small business, historic downtown with its boutique stores and restaurants, the city will capture the heart of all that visit just as it does for its residents .

The City of Pleasanton was incorporated on June 18, 1894 . Pleasanton’s history has been shaped largely by its geographic location, from its days as a stop on the transcontinental railroad, to its modern-day position as a center of commerce . Pleasanton enjoys a rich blend of historic turn-of-the-century charm and vital modern facilities that provide the quality of life and economic well-being desired by residents and businesses . This successful balance has been achieved through Pleasanton’s active and involved citizenry, strong community leadership and committed City government .

The city’s geographic location makes it strategically accessible . Pleasanton is located at the intersection of two major interstate freeways . These freeways link Pleasanton to Sacramento in the north, San Francisco Bay Area in the west, the Silicon Valley in the south and the San Joaquin central valley in the east . Along with the major freeways, the city also boasts connection with transit systems, including the Bay Area Rapid Transit (BART) and Altamont Corridor Express (ACE) which make traveling to and from the city extremely convenient .

The city’s location combined with abundant parks and recreational areas, thriving community, low crime, excellent business districts and a beautiful downtown makes Pleasanton the city of choice for new businesses, industry and residents .

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3 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2025

PAFR AWARD
Government Finance Officers Association
Award for
Outstanding
Achievement in
Popular Annual
Financial Reporting
Presented to
City of Pleasanton
California
For its Annual Financial Report
For the Fiscal Year Ended
June 30, 2024
Executive Director/CEO

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4 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024

MAYOR & CITY COUNCIL
Human Services Commission
Library Commission
Parks and Recreation Commission

HUMAN RESOURCES

LIBRARY & RECREATION

ECONOMIC DEVELOPMENT
FIRE

INFORMATION TECHNOLOGY
POLICE

CITY CLERK
Economic Vitality Committee
Civic Arts Commission
Youth Commission
Planning Commission
Bicycle, Pedestrian and Trails Committee
Energy and Environment Commission

PUBLIC WORKS

CITIZENS

FINANCE

CITY MANAGER CITY ATTORNEY
Council Member
Matt Gaidos
Mayor
Jack Balch
Council Member
Craig Eicher
Council Member
Julie Testa
Vice Mayor
Jeff Nibert

ORGANIZATION CHART
3 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2025CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024

COMMUNITY DEVELOPMENT
CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2025

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5 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 $186,206
Average Household Income
(Family of 4)
The Average
Pleasanton Resident
Possesses a
Bachelor’s Degree

68.7% of Residents
7 5,960
People Live Here
The City of Pleasanton is an
excellent community made
up of good people. These
facts/ﬁgures reﬂect the
average Pleasanton resident.

Industry Most Likely
to Work In

16.2% 15.4% 8.9%
Professional,
Scientiﬁc, &
Technical Services
Healthcare
& Social
Assistance
Administrative
& Support
Community Demographics Housing Economic Development
Fire
9 1 % of
Residents
Say Pleasanton is an
excellent or good
place to live
47 Parks
80 Trail Miles
6,939
Total Fire Department
Incidents
(Pleasanton Only)
197
Total Annual Fires
(Pleasanton Only)
Police
90,124
Total calls to communications center
1 74
Total 5 1 50 holds
White 41.9%
Black 1.7%
Asian 41.9%
Hispanic/
Latino 12.7%
Other 1.8%
51% 49%
Female Male
29,344 Total Residential Units
210 Miles
Maintained
City Streets
Workday Inc. . . . . . . . . 5,399 Employees
Kaiser Permanente . . . 3,019 Employees
Safeway Inc. . . . . . . . . 1,348 Employees
Stanford Tri-Valley
Health Care . . . . . . . . . 1,124 Employees
Veeva Systems . . . . . . . . 945 Employees
91%

68.7%
Sources: U.S. Census Bureau QuickFacts: Pleasanton city, California, 2023 Community Survey

COMMUNITY PROFILE

BY THE NUMBERS
CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2025 47 parks
82 .3 Trail Miles
Total Number of
Responses
People Live Here
Maintained
City Streets
Workday Inc . . . . . . . . . . . . . . . .5,387 employees The Permanente Medical
Group Inc . . . . . . . . . . . . . . . . . . . .1,414 employees Stanford Tri-Valley
Health Care . . . . . . . . . . . . . . . . .1,124 employees Safeway, Inc . . . . . . . . . . . . . . . . .1,110 employees 6,461
186
91,329
29,849 Total Residential Units
77,232
$186,206
(Family of 4) 70 .7% of Residents
70 .7%
30 .4% 20 .9% 11 .4%
Professional,
Scientific, &
Technical Services
Health
& Social
Assistance
Manufacturing
210 Miles
5,890
Traffic Stops
50% White 2% Black
44% Asian 4% Other

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6 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024

INTERNAL

SERVICE FUNDS

ENTERPRISE
FUNDS
Fees for services
or utilities: water,
sewer, golf courses
OTHER
FUNDS
Capital Projects
Debt Service
T rust funds

GENERAL
FUND
Taxes, fees, permits
police, ﬁre, general
City operations

SPECIAL REVENUE
FUNDS
Grants, donations,
funds districted for
special purposes
Cost allocation from
other funds, such as
equipment, vehicles,
technology

PUBLIC ENTITY
City of Pleasanton is a public entity that manages its monies as governed by the generally accepted accounting practices . A public entity must ensure appropriate use of public funds . 5 Types of City Funds
The City of Pleasanton manages a number of funds to provide a wide variety of programs and services to the community .

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7 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 Governmental funds are a group of funds (sources) that a government entity collects during the year and are used to provide most of the City services . These funds include monies collected through taxes, permits, licenses, fines, fees for services, etc . They are typically used for services that are not restricted by usage . Examples of programs funded through Governmental Funds include police and fire services, libraries, parks, and public works .

Where does money come from?
Taxes like property tax, sales tax, and transient occupancy tax comprise the largest portion of governmental funds .

This makes up about 68% of the total revenues in this category . The table below breaks down the different revenues collected by the City in FY 2024/25 compared with FY 2023/24 and FY 2022/23 . The increase in revenue in FY 2024/2025 is mainly due to large development projects and increased development activities and higher interest income and unrealized investment gain .

GOVERNMENTAL FUNDS
Where does money get spent?
The governmental funds are used for typical City operations split into five categories: General Government, Public Safety, Community Development, Public Works, and Community Activities . Public safety makes up for 34% of the expenses as firefighting and police services continue to develop as the city grows . The table below breaks down the different programs funded by the City in FY 2024/25 compared with FY 2023/24 and FY 2022/23 . The increase in expenditure in FY 2024/25 is mainly due to increases in salaries and benefits and capital outlay associated with large construction projects .

Revenue by Sources (in millions) FY 2023 FY 2024 FY 2025 Property Taxes & Special Assessments $86 .3 $90 .5 $92 .8 Sales Tax 26 .2 24 .6 25 .9
Other Taxes 12 .2 12 .0 12 .9
Other Sources 16 .4 29 . 5 37 . 2
Fines, Forfeitures & Fees 9 .2 6 .2 11 . 8
Intergovernmental 13 .0 14 .4 12 .0
Total $163.3 $177 .2 $192.6
Expenditures by Program (in millions) FY 2023 FY 2024 FY 2025 General Government $20 $25 .9 $27 . 0
Public Safety 57 . 4 64 .2 66 .7
Community Development 19 . 1 11 . 5 13 .6
Public Works 22 .8 30 .3 32 .0
Community Activities 15 .0 16 .2 15 .4
Capital & Debt 16 .7 14 .5 43 .4
Total $151 $162.6 $198.1
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8 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 Enterprise or Business Funds are a group of funds that are managed similar to a business entity . These funds collect fees to cover the cost of service and all monies collected can only be used to provide the same service . These funds are typically used for utilities – including water, sewer and storm drain, as well as golf and transit services .

Where does money come from?
The Water Utility is the biggest component, comprising of about 51% of the total group . Unlike governmental funds, each fund is a separate entity and funds from one source cannot be mixed with another . The “Other Enterprise Funds Category” represents three funds: Transit Fund, Cemetery Fund and Housing Fund . The table below breaks down the different revenues collected by the City in FY 2024/25 compared with FY 2023/24 and FY 2022/23 . The increase in revenue in FY 2024/25 is mainly due to the increase in water rate increase and transfers in to the Storm Drain Fund from other funds to support operations and capital projects .

ENTERPRISE (BUSINESS OR PROPRIETARY) FUNDS
Where does money get spent?
The Enterprise Funds are used specifically for the purpose for which the revenue is collected . For example, the amount paid on a water bill can only be used to provide water to a resident or business . This includes operating costs of the utility, capital projects needed to maintain the water system, and the cost of buying the water .

The table below breaks down the different programs funded by the City in FY 2024/25 compared with FY 2023/24 and FY 2022/23 . The increase in expenditure in FY 2024/25 is mainly due to increases in salaries and benefits, water purchase costs and sewer service charges, and loss on the disposal of capital assets due to the termination of projects and changes in project scopes .

Revenue by Sources (in millions) FY 2023 FY 2024 FY 2025 Water Fund $29 .5 $37 .1 $44 .9
Sewer Fund 16 .7 19 .4 20 .3
Golf Fund 5 .9 6 .3 6 .5
Storm Drain Fund 3 .9 3 .1 16 .2
Other Enterprise Funds 0 .9 1 .0 1 .1
Total $56.9 $66.9 $89.0
Expenditures by Program (in millions) FY 2023 FY 2024 FY 2025 Water Fund $34 .4 $39 .4 $48 .2
Sewer Fund 19 .5 19 .7 20 .8
Golf Fund 7 .7 7 .1 7 .4
Storm Drain Fund 3 .2 2 .6 2 .9
Other Enterprise Funds 0 .9 1 .0 1 .0
Total $65.7 $69.8 $80.3
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9 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 The net position is an overview of the City’s assets and liabilities . The change in total net position shows how much the balance of assets and liabilities has changed in the past year . The change in net position from FY 2023/24 to FY 2024/25 was an increase of one percent due to increased revenues over expenses . This indicates that the City gained more assets than the increase in liabilities . The goal is to ensure the City’s assets always exceed the liabilities .

NET POSITION
Net Position (in millions)
City Assets - What we own FY 2023 FY 2024 FY 2025 Current Assets (consisting mainly of cash and amounts owed to City) $336 .3 $356 .6 $376 .2 Capital assets consisting primarily of buildings, equipment and vehicles 688 .4 693 .1 706 .9 Total City Assets 1,024 .7 1,049 .7 1,083 .1
Deferred outflows of resources (future assets) 66 .2 67 .4 48 .8 Total City Assets and Deferred Outflows 1,090 .9 1,117 .1 1,131 .9 City Liabilities - What we owe
Current Liabilities consisting of all amounts the City owes, except for debt $29 .6 $37 .0 $46 .2 Non-current liabilities (including long-term debt and pension obligations) 246 .5 282 .5 290 .5 Total City Liabilities 276 .1 319 .5 336 .7
Deferred inflows of resources (future liabilities) 26 .6 17 .8 11 .4 Total City Liabilities and Deferred Inflows 302 .7 337 .3 348 .1 City’s Net Financial Position $788.2 $779.8 $783.8
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10 A fund balance is essentially the left over monies in a fund in addition to the assets owned by the fund after meeting all liabilities for the fund . Think of it as the account balance in a checking account left at the end of the month, after all the monthly purchases and bills are paid . These funds are then available for allocation to use in the next fiscal year and to retain as reserves . The City manages each fund to maintain a healthy fund balance that helps with long range planning and fiscal sustainability . The negative fund balance in the Miscellaneous Grants Fund is expected to be eliminated in the next budget cycle with annual allocations to the law program . The following charts show the fund balances for various governmental and enterprise funds .

FUND BALANCES
Governmental Funds - Fund Balance (in millions)
Enterprise Funds - Available Fund Balance (in millions) CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2025

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11 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 The City’s investment policy is designed to limit exposure to losses arising from a volatile market . The City limits investment to a maximum of five years of maturity . The City’s investments are rated by nationally recognized rating organizations . The following table shows the amounts contributed by the City in the various types of investments .

INVESTMENTS
Standard & Poor’s
U.S. Government Agencies
Federal Farm Credit Bank AA +
Federal Home Loan Bank AA +
Federal National Mortgage Association AA +
Federal Home Loan Mortgage Corporation AA +
Supranationals
International Finance Corporation AAA
International Finance Corp AAA
Asset Backed Securities
BMW Vehicle Owner Trust AAA
Hyundai Auto Receivables Trust AAA
US Treasury Securities
US Treasury AA ++
The City’s investments are rated by nationally recognized rating organizations . The City’s policy requires a rating of “A” or better . As of June 30, 2025, the ratings for the City’s investment portfolio, excluding pension related investments and LAIF , are as follows:

Amount
U .S . Government Agencies $137,087,385
Corporate 21,361,810
PARS Trust 56,332,350
California Local Agency Investment Fund (LAIF) 66,579,688 Other 40,456,687
Total Investments $ 321,817,920
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12 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 Standard & Poor’s
Medium Term Corporate Notes
Abbvie Inc . A -
Air Products and Chemicals, In A
Apple Inc . AA++
Bank of America A -
Bank of New York Mellon A
Caterpillar Financial Services A
Chubb Limited A
Cisco Systems, Inc . AA -
Duke Energy Corporation A
Eli Lily & Co A +
John Deere Capital Corp A
JPMorgan Chase & Co A
JPMorgan Chase Bank NA AA -
Marsh & Mcclennan Companies Inc A -
Meta Platforms Inc AA -
Morgan Stanley A -
Paccar Financial Corp A +
Prologis LP A
Royal Bank of Canada A
State Street Corp A
State Street Corporation A
Toyota Motor Credit Corp A +
U .S . Bancorp A
United Health Group Inc . A +

INVESTMENTS (CONTINUED)
CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2025

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CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 The City manages its long term liabilities and debt strategically . The following table compares the outstanding balances on the City’s long-term debt for FY 2024/25 compared with FY 2023/24 and FY 2022/23 . Overall, there is an increase in the amount owed mainly due to the new Costco loan associated with trasportation improvement costs incurred in the Johnson Drive Economic Development Zone (JDEDZ) . The City utilizes debt financing to fund capital related projects and strive to maintain good credit reatings to secure low interest debt and achieve savings .

Governmental activities debt increased by
$13.0 million in FY 2024/25 mainly due to:
• A $12 .8 million loan from Costco for fronting the
construction costs incurred in the JDEDZ area
• A $1 .7 million increase in subscription liabilities
mainly due to subscription addiions of $1 .3 million
with Accela Cloud to provide an SAAS multi-solution
user service
Business-type activities debt decreased by
$1.4 million in FY 2024/25 mainly due to:
• Debt service payments for the various loans, bonds,
and subscription liabilities

LONG TERM DEBT
CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2025 Governmental Activities FY 2022/23 FY 2023/24 FY 2024/25 Costco Loan Reimbursement - - $12,758,240
Finance Purchase - Vehicle $1,005,284 $984,037 $725,712 Finance Purchase - Fire Engine - 1,125,662 893,820
HUD Section 108 Loan 586,000 536,000 486,000
G3 - Sun Ridge Computer System - 684,188 684,188
Lease Liabilities - 220,353 111,773
Subscription Liabilities 987,411 1,094,421 1,927,824
Total $2,578,695 $4,608,661 $17,587,557
Business-Type Activities FY 2022/23 FY 2023/24 FY 2024/25 California Clean Water SRF Loan $9,238,640 $8,896,132 $8,550,198 Golf Course Financed Purchase $113,957 $87,460 $53,963
Golf Course Lease - 221,925 119,848
Water Revenue Bond - Series 2017 1,900,000 - -
Premium on Water Revenue Bond - Series 2024 - 1,959,574 1,953,482 Water Revenue Bond - Series 2024 - 17,275,000 16,875,000 Subscription Liabilities 504,169 767,498 235,728
Total $11,756,766 $29,207,589 $27,788,219
13

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CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 The City participates in the California Public Employees’ Retirement System (CalPERS) . The employee benefits are determined by type of work (Police, Fire or Miscellaneous Employee), date of hire, years of service and age at retirement . Both the City and employees contribute toward the pension fund .

The City’s pension liability is measured as the total pension liability less the plans’ assets . An increase to the pension liability can prove to be a challenge, since it increases pension contributions . The City has taken measures to smooth the impact of these rates by creating a long-term fiscal plan and establishing a Section 115 Pension Trust Fund, specially designed to manage pension rate fluctuations as needed .

To date, the City has allocated a total of $38 million toward this trust fund (balance at 6/30/25 with investment earnings is $56 million), which is administered by PARS Trust Fund, comprised of both short and long term investments . City Council also adopted policies that placed limits on the City’s ability to draw on the PARS Trust Fund to ensure funds are available for pension contributions during financially difficult times . In addition, to the extent to which the City is able to not draw on the PARS Trust Fund, the fund can grow through compounded investment earnings . The table below reflects the City’s pension liability for the different plans . The decrease in liability for FY 2024/25 is due to higher than expected CalPERS investment return in FY 2023/24 .1 For more information on the pension liability, please refer to the Annual Comprehensive Financial Report (ACFR) .

PENSION OBLIGATIONS
1 Pension liability decreased in FY 2024/25 due to higher than expected investment returns in FY 2023/24 . Pension liability increased in FY 2023/24 due to lower than expected investment returns in FY 2022/23 .

CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2025 14

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CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 The City of Pleasanton provides retiree health benefits to employees that retire directly from the City . The value of this benefit is defined by negotiated labor contracts . The City established an irrevocable trust set up with the California Employer’s Retiree Benefit Trust program (CERBT) administered by CalPERS, to help fund future health benefits . The table below reflects the City’s net OPEB liability as shown in the ACFR for FY 2024/25 as compared with FY 2023/24 and FY 2022/23 .2

OTHER POST EMPLOYMENT BENEFITS (OPEB)
Net Liability as of: Non-Fire Fire Total
As of June 30, 2023 $16,694,000 $4,083,500 $20,777,500
As of June 30, 2024 18,992,000 4,235,500 23,227,500
As of June 30, 2025 14,302,000 3,689,000 17,991,000
2 OPEB liability decreased in FY 2024/25 due to higher investment returns .

CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2025 15

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16 CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2024 City of Pleasanton
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CITY OF PLEASANTON POPULAR ANNUAL FINANCIAL REPORT | YEAR ENDED JUNE 30, 2025

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1/8/2026
1 FY 2024/25 Annual Comprehensive Financial Report (ACFR)Audit Committee MeetingJanuary 8, 2026 Agenda

ACFR CONTENTS

FINANCIAL HIGHLIGHTS AND UNFUNDED LIABILITIES
Q&A2
1 2

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1/8/2026
2 Review by Audit Committee•The Audit Committee (Mayor Balch and Councilmember Eicher) reviewed the ACFR and compliance reports on January 8, 2026•Committee recommendations/comments:Asked questions and discussed the audit process, audit results, financial results, significant accounting policies, significant estimates, and the implementation of the new accounting standard GASB 101oThe auditor commented on recording the general liability and workers’ compensation claims liability at the 70% level instead of the minimum level of 60% Accepted the ACFR and other related reports3 What’s in the ACFR?•Transmittal Letter•GFOA Award Certificate•Independent Auditors’ Report (Opinion)Unmodified/clean audit opinion•Management's Discussion and Analysis•Government-Wide and Fund Financial Statements•Notes to the Financial Statements•Supplementary Information•Statistical Schedules 4 3 4

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1/8/2026
3 Management's Discussion and Analysis•Financial Highlights•Government-Wide Financial AnalysisAccrual basis/private sector accounting standardAccounts for capital assets and long-term liabilitiesNegative unrestricted net position in some years •Fund Financial AnalysisModified accrual basis•General Fund Budgetary Highlights5 Financial Highlights5
6

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1/8/2026
4 Government-Wide Financial Statements Assets and Deferred Outflow of Resources (In Millions)•Assets and deferred outflow of resources total over $1.1B, increased by $15M from the prior fiscal year7 Cash, investments, and receivables represent 34% of total assets Cash, investments, and receivables represent 34% of total assets Government-Wide Financial Statements Liabilities and Deferred Inflow of Resources (In Millions)•Liabilities and deferred inflow of resources total over $340M, increased by $11M from the prior fiscal year8 GASB 101 implementation
GASB 101 implementation
$12.8M in new Costco loan
$12.8M in new Costco loan
FY24 investment gain lowered the liabilities
FY24 investment gain lowered the liabilities7
8

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1/8/2026
5 Government-Wide Financial Statements Net Position (In Millions)•Over $780M in net position, increased by $4M from the prior fiscal year9 Governmental activities unrestricted net position: -67.8M (liabilities exceed assets) Governmental activities unrestricted net position: -67.8M (liabilities exceed assets) Business-type activities unrestricted net position: 73.2M Business-type activities unrestricted net position: 73.2M Nonspendable resources
Nonspendable resources
General Fund – Fund Balance (In Millions)•Achieved 20% reserve target calculated based on unassigned fund balance10 Pension Trust Funds
Includes $6.6M in Capital Reserve9
10

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1/8/2026
6 Enterprise Funds – Net Position (In Millions)•Over $200M in total net position, increased by $8M from the prior fiscal yearOver $130M reflects net investment in capital assets that is not available for spending11 Pension and OPEB Liabilities11
12

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1/8/2026
7 Pension and OPEB Liabilities•Over $180M in net pension and retiree medical liability•Pension liability is net of funds in the PARS Pension Trust ($56M)13 Review of Investment Returns•Section 115 Pension Trust: generate resources to pay down pension obligations, ensuring long-term fiscal stability and budget predictability•PARS inception-to-date returns: 4.1% (Conservative) and 7.8% (Capital Growth)14 13 14

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1/8/2026
8 Next StepsFebruary 2026Mid-Year Budget UpdateMay 2026Mid-Term Budget UpdateJanuary - June 2026Citywide Organizational Assessment15 Thank You!
15 16

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Item #14

CITY COUNCIL AGENDA REPORT

January 20, 2026
Public Works - Utilities Division

TITLE: RECEIVE AN UPDATE ON UTILITIES SYSTEM ACTIVITY ADVANCING THE

ONE PLEASANTON STRATEGIC PRIORITY, INVESTING IN OUR

ENVIRONMENT

SUMMARY
This report provides an update on Utilities programs and projects supporting the City’s water, sewer, and stormwater systems from January 2025 through November 2025. The report highlights progress on the Water System Management Plan, Sewer System Management Plan, and Stormwater Management Plan; summarizes key regulatory requirements and implementation efforts; and provides a status update on current bond-funded projects.

The purpose of this report is to promote transparency and provide insight into the City’s ongoing efforts to effectively manage critical utility infrastructure in alignment with the City’s strategic goals, including the identified City Council strategic priority of Investing in Our Environment, ensuring reliable and sustainable water, sewer, and stormwater services for the community while advancing accountability, environmental stewardship, and long-term system resiliency.

RECOMMENDATION
Receive an update on Utilities System Activity advancing the ONE Pleasanton Strategic Priority, Investing in Our Environment.

BACKGROUND
The City distributes approximately 14,000 acre-feet of safe, reliable drinking water annually to over 22,000 customers. The City has traditionally relied on two sources of water supply:
treated surface water and groundwater purchased from the Zone 7 Water Agency (Zone 7), and groundwater from City-owned and operated wells (currently not in use). The City’s water distribution system consists of 20 storage tanks, 14 pump stations, and over 300 miles of primarily underground piping. The annual operating budget for the water system program for fiscal year (FY) 2025/26 is currently approximately $38 million, with approximately $11.5 million allocated to the Capital Improvement Program (CIP) budget.

The City owns and operates a sewer collection system comprising approximately 253 miles of gravity sewers, approximately 4.9 miles of force mains, eight siphons, 11 active pump stations, and approximately 21,000 service connections. The average dry weather flow is approximately 6 million gallons per day (MGD). The City has agreements with Dublin San Ramon Services District (DSRSD) and City of Livermore (for Ruby Hill service area) for wastewater treatment, and is a member of the Livermore-Amador Valley Water Management Agency (LAVWMA) for treated wastewater disposal. The City also has agreements with Alameda County that allow sewage flows from their Castlewood Service Area to be transported through the City’s collection system for treatment at DSRSD. The City’s sewer system operation and CIP is

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guided by the Sewer System Management Plan, approved by the City Council in July 2025.

The annual operating budget for the sewer system program for FY 2025/26 is currently approximately $19.3 million, with capital improvement needs funded separately through the City’s adopted CIP and long-term financial planning efforts.

The City maintains approximately 260 miles of storm drain infrastructure, including 6,252 individual storm drains, designed to convey runoff to local creeks and ultimately to regional water management systems. Unlike the City’s water and sewer utilities, the stormwater system is currently the only utility system funded through the General Fund. To support long-term system sustainability, the City Council approved the award of a contract on October 7, 2025, to establish the City’s first Storm Water Management Plan. One of the primary objectives of this effort is to evaluate funding and revenue generation options to better support ongoing operations, regulatory compliance, and capital investment needs for this critical utility system.

For FY 2025/26, the stormwater program operating budget is approximately $1.7 million, with an additional $12.8 million allocated through the Capital Improvement Program (CIP).

DISCUSSION
SECTION 1. WATER SYSTEM

1.1 Water System Management Plan
The Water System Management Plan (WSMP) was accepted by the City Council in January 2025. The document serves as a guiding document for the water rate study, which concluded on October 7, 2025.

1.2 Water Enterprise Fund Financials
Financing/Water Revenue Bonds
The City’s Joint Powers Financing Authority (JPFA) completed its sale of the 2024 Water Revenue Bonds on June 4, 2024, for a total of $19,164,268, including funds for issuance costs. The bond provides $19 million with a 4.11 percent true interest cost. The bond proceeds are being used to pay for the necessary near-term water infrastructure improvements and anticipated design costs for the regional groundwater wells project. The City has three years (June 2027) to complete the projects approved by the City Council as the Near-Term Water Improvements.

The City will use bond proceeds for four major water projects. Any remaining balance will be used to fund additional priority projects identified in the WSMP. The project budgets and fund balances are summarized in the table below. The status of each project is described later in this report and in more detail in Attachment 1. The total encumbered amount does not include the project contingency authorized by the City Council until a change order is issued to a contract.

Table 1. Summary of Major Water Revenue Bond-Funded Projects Project Name Total Budget Total
Expended/
Encumbered
Total
Remaining
CIP #24174 Regional Groundwater
Facility Project – In Design
$3,000,000* $339,387** $2,660,613

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CIP #24171 Turnout #4 and Stoneridge
Dr. & Sunol Water Main – In
Construction
$10,466,025 $10,122,121 $343,904
CIP #24172 Bernal Ave Water Line and
Turnout #1 - Completed
$1,985,791*** $1,985,791 $0
CIP # 24181 Turnout #4 Procurement –
In Construction
$1,300,000 $1,287,000 $13,000
Unappropriated/Contingency $2,248,184** $0 $2,248,184
Total $19,000,000 $13,734,299 $5,265,701
* Including Grant Total Budget $4,000,000
** Including Grant Total Expended $1,336,686.63
*** 24172 Original Budget $2,205,420 Project completed, remaining budget moved to unappropriated.

Water CIP Summary (Not included above) for FY 2025/26:

Table 2. Other Water CIP Projects for FY 2025/26
Project Name FY25/26 Budget Status
Water System Emergency
Power Improvements
Program
$856,990 On schedule, In Design
On Budget
Water System Management
Plan
$330,816 Completed
On Budget
Lemoine Bypass Pipeline $158,020 On-Hold, Completed design.

Pending Construction Budget and
competing priorities.

Recycled Water System
Management Plan
$300,000 On-Hold. System is in good condition.

Comprehensive management plan
postponed to 2027/2028
Annual Recycled Water
Repair & Replacement
$100,000 On-Hold. System is in good condition.

The fund is reserved for emergency
situation.

Water Meter and AMI System
Replacement
$2,770,000

On Schedule, Project is advertised.

Additional budget for construction needed
Annual Water Distribution
Improvements
$550,000 On schedule, In Design
On Budget

The City’s water meter replacement project has been accelerated to meet the target completion date of December 2028 per the settlement agreement with Zone 7. To avoid an impact on the water reserve fund and water rates, staff plans to postpone the Kilkare-Sunol Fire Flow project for a year, starting design in FY 2028/29.

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2025 Water Enterprise Operating Budget
According to the May 2025 Council-approved operating budget, the annual operating budget for FY2025-26 is $38 million.

The Operating Budget supports water supply purchases (~$25 million), routing repair and replacement (R&R, $800k) of water distribution system, lift station, booster pump station, and other water-related expenditures like personnel salary, transportation and training, debt services, regular operating maintenance, utility billings and business services, and water conservation services (~$12.2 million).

1.3 Water Supply and Distribution
The City’s water supply portfolio continues to rely on Zone 7 Water Agency deliveries. Zone 7 has indicated that adequate regional supply availability is expected through FY 2025/26.

Distribution system performance remains strong, with ongoing valve and hydrant maintenance programs ensuring system reliability and fire flow capability.

1.4 Water Rate and Connection Fee Studies
On October 7, 2025, the Prop 218 process was completed successfully. The City Council approved the new water rate increase for the next four years. The new rate took effect on January 1, 2026.

1.5 Regulatory Requirements and Implementation
This section outlines all the State-mandated regulatory requirements for the City of Pleasanton as a water distributor and water retailer, including how the regulation will impact the City, businesses, and residents.

PFAS Regulations
Description

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On April 10, 2024, the U.S. Environmental Protection Agency (EPA) announced the final National Primary Drinking Water Regulation (NPDWR) for six per- and polyfluoroalkyl substances (PFAS). According to EPA regulations, public water systems must initially monitor for these PFAS by 2027. Per the EPA regulation, public water systems must comply with the new PFAS MCLs by 2029.

The rule sets enforceable Maximum Contaminant Levels (MCLs) for six PFAS (PFOA, PFOS, PFHxS, PFNA, HFPO-DA, and mixtures) based on a Hazard Index. Public water systems have three years from the rule’s effective date to carry out initial monitoring/testing for these PFAS (i.e., by 2027). After that, systems must conduct ongoing compliance monitoring and report levels to the public (beginning in 2027). Within five years (by 2029), if levels exceed the MCLs, systems must implement treatment or other measures to reduce PFAS levels and notify the public of violations.

Funding
NA
Key Milestones:
2027- carry out initial monitoring/testing for these PFAS and conduct ongoing compliance monitoring and report levels to the public
2029 - if levels exceed the MCLs, systems must implement treatment or other measures to reduce PFAS levels and notify the public of any violations
Impact Analysis
To the City
Wells 5, 6, and 8 have been
shut down since November
2022. The City currently
purchases all water from
Zone 7.

To Businesses
No direct impact
To Resident
No direct impact
Current Status
The City has stopped supplying water using Wells 5, 6, and 8, which have exceeded the new EPA MCL on the six elements of PFAS, and is purchasing 100 percent of water from Zone 7.

By doing so, the EPA regulation is not applicable to the City. The City is partnering with Zone 7 on Phase 1-Feasibility Study to explore the possibility of diversifying our water supply with new groundwater wells. Staff is planning to present the Feasibility Study to the City Council in Spring 2026 with a recommendation for the next phase.

Making Conservation a California Way of Life Regulation Description
The State Water Resources Control Board (SWRCB) adopted the Making Conservation a California Way of Life regulation. Under this new regulation, urban water suppliers must comply with their annual “urban water use objective” (UWUO), which is the sum of standard- based budgets for an aggregate set of water uses, by January 2027. Critical data necessary to accurately analyze long-term implications for the City, compared to current usage, is not yet available. A water use budget will be established for Pleasanton’s entire service area, rather than individual households or businesses. The City will continue to work with

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customers to achieve water savings that may be needed to meet the new regulation. The City met UWUO compliance for both FY 2023/24 and 2024/25 reporting cycles, with actual usage over FY 2024/25 of 12,846 acre-feet (AF), compared to the City’s FY 2024/25 Objective of 14,878 AF.

Funding
Operating Budget: $40,000
Key Milestones:

Jan 2027 - Comply with UWUO
Impact Analysis
To the City
The impact analysis is currently
incomplete due to pending data
requirements, which will be
supplied by the Department of
Water Resources.

To Businesses
No immediate
impacts
To Resident
No immediate impacts
Current Status
Water conservation remains an integral part of the Tri- Valley’s water program. For the calendar year 2024, water customers’ conservation efforts fluctuated, as shown in the summary chart below. For the 11 months shown, water consumption was reduced by an average of 10 percent. February, March, and May were the months with higher conservation due to the wet weather. These are significant reductions, indicating that City water users are prioritizing conservation.

Water Loss Program

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Description
As part of the State’s “Making Conservation a California Way of Life” regulatory framework, the State WRCB has adopted Real Water Loss Performance Standards applicable to all urban retail water suppliers. These standards are designed to reduce physical water losses from distribution system leaks, breaks, and other inefficiencies. Collectively, these requirements advance statewide efforts to improve water system efficiency, strengthen accountability, and promote long-term water conservation as a permanent and sustainable practice in California.

Funding
Operating Budget
Key Milestones:

Annually - The water loss component is
incorporated into the City’s Urban Water Use
Objective with an annual report
January 1, 2028 - compliance with individualized
performance standards and the State-specified
water loss target
Impact Analysis
To the City To Businesses To Resident
The City will be required to
continue conducting
validated annual water loss
audits, enhance leak
detection and repair
programs, and maintain
detailed records of system
performance. Meeting the
new real water loss
standards by 2028 requires
capital investment in
pipeline rehabilitation,
pressure management,
advanced metering, and
improved data systems.

Part of the recent
water rate increase
is associated with
new water loss
control measures.

Part of the recent water rate increase is
associated with new water loss control
measures.

Current Status
Evaluating the City’s water loss target set by the State Water Board and establishing a program that supports the City to meet compliance by January 1, 2028.

Urban Water Management Plan
Description
An Urban Water Management Plan (UWMP) is a state-mandated, long-range planning document required by California law that demonstrates how the City will reliably meet water demands over a 20-year planning horizon, including during droughts and emergencies. The UWMP evaluates existing and future water supplies, projects water demands, documents water conservation and efficiency efforts, and incorporates the City’s Water Shortage Contingency Plan. The Plan must be updated every five years, adopted by the City Council

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following a public hearing, and submitted to the California Department of Water Resources.

Adoption of the UWMP supports sound financial and capital planning, ensures compliance with state requirements, and provides a policy framework for managing water resources under normal, dry, and emergency conditions.

Funding
Operating Budget - $100,000

Key Milestones:

By July 1, 2026 - City Council accepts the
Urban Water Management Plan; Urban Water
Management Plan due to the SWRCB
Impact Analysis
To the City To Businesses To Resident
Fulfills regulatory
requirement, provides basis
for future yearly Zone 7
delivery requests
No immediate impacts No immediate impacts
Current Status
The draft UWMP is currently under development, and a Notice of Preparation is anticipated to be released in January 2026.

AB1572 Nonfunctional Turf Ban
Description
AB 1572 is a new law systematically prohibiting the watering of “nonfunctional turf” with potable water (single-family homes are exempt). Nonfunctional turf is considered areas of grass that are not located in recreational-
use areas or community spaces with open access for assembly. Exceptions exist for watering to the extent necessary to ensure the health of trees and other perennial plants. No restrictions exist on residential yards, cemeteries, parks, sports fields, or golf courses.

Funding
CIP Project 26767 $1.1 million Total for
FY25/26 and FY 26/27

R&R Budget $150,000 for FY25/26
Key Milestones:

January 1, 2027 – All properties owned by the City
and other government agencies
January 1, 2028 –
All other institutional and commercial properties
January 1, 2029 – All common areas of
homeowners’ associations, common interest
developments, and community service
organizations or similar entities
January 1, 2031 – All government facilities in
disadvantaged communities (or the date at which
State funding is available)
Impact Analysis
To the City To Businesses To Resident
Upgrade City-owned
nonfunctional turf by January
Establishing a plan
and budget to
Reduction in turf areas around the city
and removal of nonfunctional turf in

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1, 2027 convert
nonfunctional turf
by the required
deadline.

HOAs to meet compliance.

Current Status
Staff has facilitated a study to identify underutilized turf areas at selected City-owned properties with opportunities for water reduction through turf replacement. A CIP Project with a total budget of $1.1 million was approved by the City Council in May 2025 with an R&R budget of $150k.

To meet the requirements, the City must revise its municipal code to include the prohibition of potable water use among the AB 1572 specified potable water customer categories and must communicate the new requirements to customers on or before January 1, 2027. Staff recommends adding this to the Pleasanton Municipal Code (PMC) Section 14.04.060(G), which lists the City's current definitions of water "waste" as prohibited uses of water. This revision will be presented to the City Council in the first half of 2026.

Staff will engage the community through outreach to stakeholders and customer classes that will be impacted by the new prohibition, as well as by addressing public calls, inquiries, and water waste reports. Proactively, staff will develop outreach content to educate customer classes about the new prohibition and provide guidance on alternatives to turf. Additionally, staff anticipates an increase in customer calls with concerns and questions regarding the new requirements.

Addressing the new AB 1572 requirements has been incorporated into the Public Works FY 2025/26 work plan, which has the added benefit of supporting the City's efforts in achieving its obligations under the new Making Water Conservation a California Way of Life regulation.

Cross-Connection Control Regulations
Description
The goal of the new Cross-Connection Control Policy Handbook (CCCPH), which went into effect July 1, 2024, is the protection of public health through the establishment of standards to protect public drinking water distribution systems through the prevention of backflow from end-user sources into the potable distribution system. In accordance with these new regulations, the City developed a Cross-Connection Control Plan (CCCP), which was submitted to the Division of Drinking Water prior to the July 1, 2025, due date. Additionally, staff continues to participate in regional technical work groups, which periodically meet to share information and ideas about implementing this regulation.

Funding
Operating Budget: $40,000
Key Milestones:

July 2028 – Compliance target for identification
and backflow of all parcels with wells and City
potable supply
July 2035 – City's proposed deadline for
completion of initial hazard assessment over all

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connections
Impact Analysis
To the City
Requires a substantial
amount of staff time to
implement.

To Businesses
Businesses
identified as being
out of compliance
will need to install
backflow prevention
devices.

To Resident
Residents identified as having a level of
cross-connection hazard requiring
backflow protection, if not currently
equipped, will be responsible for
installing the appropriate backflow
protection.

Current Status
Staff is in the process of conducting hazard assessments of the potable distribution system to detect possible cross-connection hazards within the framework outlined in the CCCP.

Educational content has been developed and is available on the City’s website to support the community with any questions regarding backflow protection and cross-connection controls, which may result from staff outreach efforts. City website has been updated with the current information: Cross-Connection Control & Backflow Prevention Program - City of Pleasanton

Lead and Copper Rule
Description
The State Division of Drinking Water (DDW) developed new guidelines for lead and copper, which require water agencies to inspect all service lines for lead and copper within their respective service area.

The next step is for DDW to review and provide a response to the lead service line inventory.

Sampling is conducted every three years, and the last residential sampling occurred in September 2025. The new Lead and Copper Rule for 2025 requires that community water systems test for lead in drinking water in elementary schools and childcare facilities they serve; previously, there was no federal requirement for community water systems to test for lead in drinking water in these types of facilities.

Funding
Phase 1-Operation
Phase 2-Unfunded
Phase 3-Unfunded
Key Milestones:

Phase 1 - October 16, 2024 – City staff submitted
a plan to Division of Drinking Water (DDW) using
the stratified sampling method to inspect 764
homes and businesses for lead service lines. Zero
lead was found. The identified homes were built
pre-1985. The plan was approved by DDW.

Phase 2 - December 31, 2025 – State required
water retailers to send notifications to all the
unknown/unverified property owners with properties
built before 1985. The City is exempt from this
requirement.

Phase 3 - October 16, 2027 – City must submit a
complete Lead Service Line Inventory (LSLI) to
the State Water Board (all public and private

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service lines classified as lead, galvanized requiring
replacement (GRR), non-lead, or unknown).

Starting 2027 – City must provide annual public
access to the inventory and update as
replacements occur.

Phase 4 - 2029–2039 – Mandatory 10-year lead
service line replacement program (LSLR)
begins, targeting all identified LSLs and GRRs, with
an annual replacement rate of at least 10 percent
unless approved otherwise.

Ongoing – Compliance with monitoring, customer
notification within 24 hours of elevated lead results,
and annual consumer confidence reporting.

Impact Analysis
To the City To Businesses To Resident
Additional coordination with
water meter replacement
project. Currently, no
additional funding needed.

If lead pipes or
connections are
found on private
property, property
owner will need to
mitigate the non-
compliance.

If lead pipes or connections are found on
private property, property owner will
need to mitigate the non-compliance.

Current Status
The City is on schedule to complete all tasks required under the State’s Lead and Copper Rule. Traditionally, the City is responsible for infrastructure from the water main to the water meter, while property owners are responsible for infrastructure from the meter to the building.

Under the new State requirement, the City must now verify and document both public and private service line materials.

To meet this requirement, staff implemented a three-phase approach:
• Phase 1: EPA finalized the Lead and Copper Rule Improvements. The Initial LSLI submission for City of Pleasanton (CA0110008) was accepted as timely on October 9, 2024. The inventory submission and work plan were reviewed and approved by the Lead and Copper Rule Unit on January 10, 2025. Staff conducted visual inspections of approximately 750 residential, commercial, and industrial sites. No lead pipes were found in Pleasanton’s drinking water system.
• Phase 2: Confirmed with the State Water Board that the City had fulfilled this requirement, as the statistical sampling completed in October 2024, showed the City has no lead pipes.
• Phase 3: The City will replace all 22,000 water meters by Spring 2028. Based on the State Water Board's requirement, staff is prioritizing 380 water meter replacements at properties built before 1985 and vulnerable facilities, such as schools, daycare facilities, and senior centers. During meter replacement, contractors will conduct concurrent inspections to confirm full compliance with lead and copper requirements.

It is anticipated that 75 percent of the water meters (about 15,700) will be replaced by

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the end of 2027, and 100 percent by 2028, exceeding the State’s requirement.

1.6 Recent Test Results and Reports
Annual Water Quality Report
The State-mandated water quality report, also known as the Consumer Confidence Report (CCR), was completed in May. The technical and analytical water quality information presented in the CCR is required by State health regulations. These regulations require water suppliers to inform customers about the source of their water, the contents of their water, and any violations of safe drinking water standards that may have occurred during the preceding reporting period. This report provides the results of all tests required to be performed on Pleasanton’s water supplies during 2024. The CCR reports that all 2024 water quality tests confirmed the water delivered to the Pleasanton community met all applicable federal and state drinking water standards without any violations. The report is posted online at www.PleasantonWater.com, and copies are available at the Public Works Department/Operations Service Center at 3333 Busch Road.

TTHM/ HAA5 Public Notification
Total Trihalomethanes (TTHM) and haloacetic acids (HAA5s) are disinfection byproducts (DBPs) that form when water disinfectants, such as chlorine and chloramine, react with other naturally occurring organic matter (dissolved leaves and other vegetation) in the water. Levels of TTHMs and HAA5s are affected by the organic content in the water, water age, storage practices, and warmer temperatures.

Since 2022, the City has relied solely on Zone 7 surface water. Surface water generally contains higher organic matter and DBP precursors compared to groundwater.

As part of our ongoing monitoring, if the City identifies a result above a drinking water standard, we are required to notify customers. These notices are not emergencies, but they provide important information about what was found, what it means, and the steps being taken to ensure compliance with state and federal standards.

On June 10, 2025, testing at one of the City’s 19 storage tanks (Tank 1600 in the Kilkare area) showed levels of TTHM and HAA5 above regulatory standards. This exceedance affected fewer than 200 customers and was addressed immediately. The City met with regulators and proposed a corrective action plan that includes three mitigation measures: ongoing flushing of the water distribution system, installation of a solar mixing device in Tank 1600 to reduce water age and improve circulation, and the engagement of a consultant to develop a long-term mitigation plan.

In December 2025, the City submitted a proposed near-term and long-term mitigation plan to the State for review. While the City is working with the State to implement an approved permanent solution, the City has implemented an interim action plan by flushing the affected system to prevent stagnant water and reduce the development of byproducts. The intermediate action plan has shown positive improvements, as evidenced by test results that indicate the TTHM/HHA5 level is below the MCL.

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SECTION 2. SANITARY SEWER SYSTEM

2.1 Sewer Enterprise Fund Financials
The Sewer Enterprise Fund remains financially stable through the first half of FY 2025–26.

Revenues and expenditures are tracking close to budgeted projections, with expenditures primarily related to system maintenance, regulatory compliance, and capital improvement projects. Fund reserves remain within the adopted reserve policy levels, providing adequate capacity to support planned rehabilitation and replacement projects.

Table 3: Sewer CIP Summary for FY 2025/26
Project Name FY25/26 Budget Status
Annual Sewer Inspection
System Improvements
$730,000 On schedule, In implementation
On Budget
Sewer System Emergency
Power Improvements
Program
$2,167,532 On schedule, At 65% design. Target to
start construction Summer 2026.

On Budget
Sewer Capacity Evaluation $36,673 Completed
On Budget
Sewer System Management
Plan
$132,759 Completed
On Budget
Sewer Station S-14 Electrical
Improvements
$643,138 On schedule, In Construction
On Budget
Denker Drive Emergency
Sewer Repairs
$650,000 Completed
Not budgeted
Sunol Boulevard Sewer
Improvements
$1,600,000 On schedule, In Design
On Budget

Sewer Operating Budget Summary for FY25/26:

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2.2 Sewer System Management Plan (SSMP)
Public Works continues implementation of the City’s Sewer System Management Plan (SSMP), consistent with the State's Waste Discharge Requirements. Recent efforts include updates to maintenance standards, staff training, and data collection for performance tracking.

A full SSMP was approved by the City Council in June and submitted to the State Water Board in July 2025, as required every five years.

2.3 Sewer Rate Study
The City’s multi-year Sewer Rate Study is underway to assess the adequacy of existing rates in supporting operating, maintenance, and long-term capital needs. Preliminary findings indicate that projected needs will necessitate rate adjustments to maintain fiscal sustainability.

Staff presented the Long Term Sewer CIP on November 4, 2025 that will be used as the basis for the sewer rate study. Staff anticipates presenting financial model results in early 2026, preliminary rates by mid-2026, and the completed sewer rate study and Prop 218 process by late 2026. Staff targets new sewer rates to be effective January 1, 2027.

2.4 Regulatory Requirements and Implementation
Staff continues to monitor and implement new and evolving State and Regional regulatory requirements, including compliance with the San Francisco Bay Regional Water Quality Control Board’s updated sanitary sewer order and reporting mandates. Implementation efforts focus on Fat, Oil, and Grease (FOG) inspection and enforcement, sewer condition assessment using CCTV, force main inspection, siphon inspection, and root foaming.

SEWER PIPE BLOCKAGE CONTROL PROGRAM
Description
In California, FOG (Fats, Oils, and Grease) management is regulated under the State Water Resources Control Board’s Waste Discharge Requirements (WDRs) for sanitary sewer systems. Specifically, the Statewide General Waste Discharge Requirements Order No. 2006-0003-DWQ, as amended by Order No. WQ 2013-0058-EXEC, requires all sewer

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system agencies to implement a Sanitary Sewer Management Plan (SSMP). One of the mandatory SSMP elements is a FOG Control Program, which outlines how the agency will identify and control sources of FOG that may cause blockages in the collection system.

Agencies must implement measures such as public education, inspection of food service establishments, enforcement of grease control device requirements, and maintenance of high-FOG areas in the system. These regulations are designed to reduce sewer spills, protect public health, and ensure compliance with state and federal Clean Water Act requirements.

Funding
Sewer Enterprise Fund
Key Milestones:
2025 - Establish FOG Program
Impact Analysis
To the City To Businesses To Resident
Resources and training
requirements
Educate on
regulations,
implement
measures, and
maintain
compliance. Non-
compliance may
result in fines and
service interruptions.

Little impact. Regulations mainly target
businesses and commercial facilities.

Current Status
Council approved adding an Environmental Services Specialist to the Environmental Services Division under the Utility Operation 2025 budget cycle to conduct FOG-related tasks, and this position was filled in December 2025. In addition, to support compliance with WDR requirements, the City hired a consultant to finalize the Sewer Pipe Blockage Control Program manual and provide as-needed temporary support with conducting FOG inspections while the program is being established.

Staff has conducted educational outreach to food service establishments that will receive FOG inspections, providing guidance on best management practices (BMPs) and advanced notification of inspections. In addition, City staff met with the Pleasanton Downtown Association (PDA) in October 2025 to provide information about the program and its impact on food service establishments. They also partnered with the PDA to distribute educational materials to downtown businesses.

To support food service establishments, staff have created educational outreach materials and updated the City’s website with current information. Staff also conducted the first public outreach engagement at the 2025 Fire Expo Public Works booth in October 2025. The inspection program will be in full effect early in 2026.

SEWER SYSTEM CONDITION ASSESSMENT- CLOSED-CIRCUIT TELEVISION (CCTV) Description
Under the State Water Board’s Waste Discharge Requirements (WDRs) Order No. 2006-

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0003-DWQ, as amended by Order No. WQ 2013-0058-EXEC, all wastewater collection system agencies in California are required to implement a Sanitary Sewer Management Plan (SSMP) to minimize the risk of sanitary sewer overflows. One of the key components of the SSMP is the requirement to evaluate and assess the condition of the sewer system using inspection techniques such as Closed-Circuit Television (CCTV). CCTV inspections provide detailed visual documentation of pipe conditions, helping agencies identify maintenance needs, structural deficiencies, and potential sources of blockages. This regulatory requirement ensures that agencies maintain an ongoing assessment program to support preventive maintenance, rehabilitation planning, and overall system reliability in compliance with state standards.

Funding
Sewer Enterprise Fund
Key Milestones:

Complete CCTV inspections of the entire sewer
system every 7 years
Impact Analysis
To the City To Businesses To Resident
Resource and budget needs None None
Current Status
The City has completed approximately 30 percent of the CCTV inspection of the sewer collection system. Funding is in place for FY 2025/26 and FY 2026/27 to continue the inspection program. Continuation of the program beyond FY 2026/27 will be contingent upon approval and adoption of updated sewer rates.

Internal sewer operations capacity remains constrained due to ongoing recruitment challenges. To support continuity of the inspection and cleaning program, the City has established on-call contractor services to augment internal staff resources.

Year-to-date, the City has completed approximately 239,561 linear feet of sewer cleaning and 127,023 linear feet of CCTV inspection, using a combination of City staff and contractor support. These production levels represent strong progress early in the fiscal year.

FORCE MAIN INSPECTION PROGRAM
Description
Under the State Water Board’s Waste Discharge Requirements (WDRs) Order No. 2006- 0003-DWQ, as amended by Order No. WQ 2013-0058-EXEC: Wastewater collection system agencies are required to properly operate, maintain, and manage all components of their sewer systems, including force mains. The SSMP requires the City to have a proactive program to assess the condition, reliability, and performance of these pressurized pipelines.

Inspections may include visual assessments, pressure testing, acoustic monitoring, or internal condition evaluation using specialized technologies. Regular force main inspections are critical for identifying potential leaks, corrosion, or structural failures, thereby reducing the risk of sanitary sewer overflows and ensuring compliance with state requirements for system integrity and environmental protection.

Funding: Key Milestones:

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Sewer Enterprise Fund 2025 - Establish Force Main inspection program and start inspection
Impact Analysis
To the City To Businesses To Resident
Resource and budget needs None None
Current Status
A consultant is being brought on board to establish a force main inspection program and initiate inspections in 2026, with projected completion in 2026. The result of the inspection will be used to initiate the CIP or R&R project. The current funding is allocated for the inspection. Funding for CIP and R&R projects on the force main system is pending approval and adoption of the new 20-year sewer CIP program, as well as approval of the new sewer rate adoption. Inspection will start after the City Council approves the issuance of an as- needed contract.

LIFT STATION INSPECTION PROGRAM
Description
Under the State Water Board’s Waste Discharge Requirements (WDRs) Order No. 2006- 0003-DWQ, as amended by Order No. WQ 2013-0058-EXEC, agencies that own or operate sanitary sewer systems are required to properly manage, operate, and maintain all parts of the collection system, including lift stations. As part of the SSMP, agencies must establish and implement inspection, maintenance, and monitoring procedures to ensure lift stations function reliably and do not contribute to sanitary sewer overflows. This includes routine inspections of pumps, wet wells, electrical and control systems, alarms, and backup power equipment to verify proper operation. Lift station inspection and maintenance programs must be documented and supported by appropriate staffing, preventive maintenance schedules, and emergency response plans to ensure compliance with state regulations and protection of public health and the environment.

Funding:

Sewer Enterprise Fund
Key Milestones:
2025 - Establish lift station inspection program
Impact Analysis
To the City To Businesses To Resident
Resource and budget needs None None
Current Status
The City completed inspection of all lift stations in 2024. Based on inspection results, several lift stations have been identified as requiring Priority A and B improvements, which are primarily minor in nature and intended to extend the useful life of assets through the end of the 20-year Capital Improvement Program (CIP) planning horizon. Only Lift Station S-5 is currently targeted for near-term full replacement.

The CIP scope and associated budget needs are identified in the 20-Year Sewer CIP Plan approved by the City Council on November 4, 2025. Funding to support the implementation of the CIP is contingent upon the completion of the sewer rate study and the adoption of

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updated sewer rates, anticipated in January 2027.

SEWER SIPHON INSPECTION PROGRAM
Description
Under the State Water Board’s Waste Discharge Requirements (WDRs) Order No. 2006- 0003-DWQ, as amended by Order No. WQ 2013-0058-EXEC, agencies that own or operate sanitary sewer systems are required to properly manage, operate, and maintain all parts of the collection system. This requirement includes sewer siphons, which are critical infrastructure elements designed to convey wastewater beneath roadways, waterways, and other obstructions. As part of the SSMP, the sewer siphon inspection program establishes routine inspection, maintenance, and monitoring procedures to ensure siphons remain structurally sound, hydraulically functional, and free of obstructions or excessive sediment buildup. Inspections typically include visual assessments of siphon barrels and appurtenances, evaluation of flow conditions, confirmation of accessibility and operability, and identification of conditions that could contribute to blockages or sanitary sewer overflows.

The program is documented and supported by appropriate staffing, inspection frequencies, maintenance protocols, and corrective action procedures to ensure compliance with WDR requirements and to protect public health and the environment.

Funding:

Sewer Enterprise Fund
Key Milestones:
2025 - Establish siphon inspection program
2025 - Root Foaming
Impact Analysis
To the City To Businesses To Resident
Resource and budget needs None None
Current Status
The City is implementing a consistent siphon inspection program. City staff have completed inspections of six out of the eight siphons, including locations that had not been previously inspected. During the inspections, heavy cleaning needs were identified, water valve pot lids were found, a siphon sag was observed at the Laguna Creek location, and several areas requiring corrective action were identified at the Highland Oaks siphon. Additionally, trough work was identified as needed at the Nob Hill siphon.

Lift Station S-5 had already been identified as requiring rehabilitation, and inspection results confirmed additional deficiencies to be addressed as part of that effort. The Meadowlark siphon, which was repaired several years ago and was not included in the initial inspection scope, was also evaluated.

Moving forward, siphon inspections will be conducted on a seven-year inspection cycle consistent with the City’s Sewer System Management Plan (SSMP).

The City also implemented root foaming within the sewer collection system for the first time.

During the fiscal year, approximately 64,699 linear feet of pipeline were treated, with efforts focused on known root intrusion areas and locations where sanitary sewer overflows had been historically root-related. CCTV inspection data were used to prioritize segments with

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operation and maintenance ratings of 4 or 5, where root intrusion was the primary contributing factor to the rating. This effort represents a significant milestone in the City’s proactive management of the sewer collection system.

2.5 Sewer Spill Report and Other Reportable Events
From January 2025 through the reporting period, the City did not have any sanitary sewer overflows (SSOs). This is evidence of a strong maintenance program by staff.

2.6 Asset Management and Capital Improvement Program
The City continues to implement its long-term sewer asset management program to guide reinvestment in aging infrastructure. Key activities during the reporting period include force main assessments, root foaming, siphon inspections, and the initial implementation of a maintenance hole inspection program utilizing SewerAI, as well as SCADA system upgrades.

Approximately 30 percent of the sewer collection system has been inspected through CCTV as part of the ongoing condition assessment program. Construction of priority replacement and rehabilitation projects is progressing on schedule and within budget.

2.7 Operations and Maintenance
During the reporting period, staff completed 239,561 linear feet of sewer main cleaning and 127,023 linear feet of CCTV inspection. Staff also initiated a root foaming program, treating 64,699 linear feet of pipeline. Targeted work focused on known root intrusion areas, existing trouble spots, and locations where SSOs had historically been root-related. CCTV inspection data are used to prioritize segments with operation and maintenance ratings of 4 or 5, identifying areas with O/M ratings of 4 or 5 where root intrusion is the primary contributing factor. Routine preventive maintenance continues to reduce the need for emergency responses. In addition, staff initiated updates to the computerized maintenance management system (CMMS) to improve data tracking and efficiency. Equipment replacements and training investments are ongoing to support system reliability and safety.

SECTION 3. STORM DRAIN SYSTEM

3.1 Storm Drain Fund Financials
The Storm Drain Fund remains within budget. Expenditures this period primarily supported maintenance activities, regulatory compliance, and preliminary design of infrastructure improvements. Staff continue to evaluate long-term funding needs for capital reinvestment to support aging infrastructure and compliance with stormwater permit requirements. The City's storm drain system is currently supported by the General Fund. Development of a Storm Water Management Plan (SWMP) is currently underway, with target completion in 2028. The SWMP will be used as the foundational document in 2029 to evaluate the financial needs of the City's storm drain infrastructure and to establish revenue sources to support the utility infrastructure.

The current CIP budget for the Storm Water System is approximately $13.4 million.

The Storm Water Operating Fund for FY25/26 is approximately $1.7 million. The budget is sufficient only to meet the minimum effort required to maintain compliance with the stormwater permit's operational needs outlined in the Municipal Regional Permit (MRP 3.0). Additional funding is needed to support ongoing system inspection, assessment, inspection, repair, replacement, and capital improvement needs.

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3.2 Municipal Regional Stormwater Permit Compliance
The City is obligated to implement requirements under the San Francisco Bay Regional Water Quality Control Board’s (Regional Water Board) Municipal Regional Stormwater NPDES Permit (MRP 3.0, Order R2-2022-0018), which governs stormwater discharges from municipal separate storm sewer systems (MS4s) in the Bay Area. Under MRP 3.0, the City implements a broad range of pollution prevention, maintenance, and planning activities designed to protect water quality and reduce pollutant discharges to local creeks. Staff submitted the City’s FY 2024/25 Annual Report to the Regional Water Board in September 2025, documenting the City’s compliance activities throughout FY 2024/25.

Key ongoing program implementation efforts during this reporting period include:
• Continued maintenance activities are necessary to maintain and demonstrate the 100 percent trash load reduction requirement as defined under the permit, through a combination of full trash capture devices, enhanced street sweeping, and hotspot cleanups.
• Continued implementation of the City’s green infrastructure strategies, integrating stormwater treatment measures into public and private development projects, and tracking cumulative impervious surface treated as part of the regional compliance effort. • Inspection of business facilities, industrial, and construction sites to ensure compliance with stormwater best management practices (BMPs).
• Addressing illicit discharge response and enforcement. • Coordinating with the Alameda Countywide Clean Water Program (ACCWP) in regional programming, including staff training, public outreach, monitoring, and reporting programs related to mercury and PCB controls.

3.3 Operations and Maintenance
Maintenance crews completed 60 catch basin cleanings and addressed 53 targeted hotspot locations, in addition to performing routine maintenance on storm lift stations. In addition, all

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140 catch basins equipped with full trash capture devices were inspected and cleaned.

Maintenance activities are ongoing during the winter storm season to ensure stormwater conveyance systems remain clear and fully operational, including work within Stream and Pond Maintenance Program areas. Preventive maintenance remains a key focus for reducing localized flooding and protecting water quality.

3.4 Capital Improvement and green infrastructure strategies The City continues to integrate storm drain capital improvement needs with implementation of green infrastructure strategies in support of compliance with the San Francisco Bay Regional Water Quality Control Board’s Municipal Regional Stormwater NPDES Permit (MRP 3.0).

Current projects include the Sassafras Court Storm Drain Interceptor, Sycamore Creek Storm Drain Improvements, and the development of the Stormwater System Management Plan.

These efforts support the required stormwater treatment, pollutant load reduction, and long- term system performance objectives under the permit. In addition, staff is evaluating long-term funding strategies through the Management Plan to support ongoing system renewal, regulatory compliance, and stormwater quality improvements.

Table 4. Storm Drain CIP Summary for FY25/26
Project Name Revised Budget Status
Annual Storm Repair/
Replacement (Puri Court)
$1,612,944 In Closeout
Sycamore Creek Storm Drain
Improvements
$4,904,137 Design on schedule
Sycamore Creek Storm
Improvements (Sycamore
Road)
$1,000,000 Design on schedule
Augustin Bernal Trail Creek
Crossing Culverts and
Retaining Wall
$1,125,695 Design on schedule
East Vineyard Detention Pond
Outfall Repair
$511,261 Design on schedule
Oak Tree Farm Outfall and
Channel Stabilization
$562,897 Design on schedule
Park Pathway Restoration
(Alviso Adobe & Tawny Parks)
$150,000 Design on schedule
Sassafras Court Storm Drain
Interceptor
$549,254 Design on schedule
Storm Water System
Management Plan
$2,200,000 Implementation on
schedule

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Annual Storm Water Repair
and Replacement
$200,000 Reserve
Annual Installation of Trash
Capture Devices
$20,490 Reserve

EQUITY AND SUSTAINABILITY
The water system improvements and planning efforts support the City’s Climate Action Plan

2.0 (CAP 2.0), specifically the Water Resources goal to reduce greenhouse gas emissions associated with water use and prepare community water resources for a changing climate.

These actions enhance system reliability and resiliency while supporting long-term sustainability.

OUTREACH
The City conducts ongoing outreach to residents, businesses, and community partners to share information on utility system operations, regulatory programs, and infrastructure investments. Outreach efforts include Citywide communication channels such as the Pleasanton Pipeline e-newsletter, updates to the City’s website, participation in community events, and targeted coordination with business groups and regional partners to support program awareness and regulatory compliance.

STRATEGIC PLAN ALIGNMENT
This item advances the ONE Pleasanton Strategic Plan goal of Investing in Our Environment, specifically Strategy 2 (Asset Management Planning), Strategy 4 (Complete the Water System Master Plan), Strategy 8 (Update the Sewer System Master Plan), and Strategy 9 (Develop the Stormwater Master Plan), by supporting ongoing utility system planning, operations, inspections, and capital improvements to maintain reliable, sustainable, and resilient infrastructure.

FISCAL IMPACT
The activities described in this report are supported through existing adopted operating and capital budgets including the year-end report. No immediate fiscal action is requested as part of this item. Ongoing and future program costs will continue to be evaluated and addressed through the City’s annual budget process, Capital Improvement Program, and related long- term financial planning efforts.

Prepared by: Submitted by: Approved by:

Siew-Chin Yeong, Director
of Public Works
Siew-Chin Yeong, Director of Public
Works

Gerry Beaudin, City
Manager

Attachments:

1. January 2026 Utilities System Update Presentation

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1 UTILITY SYSTEM REPORT AND UPDATEDRINKING WATER, SANITARY SEWER AND STORM DRAIN SYSTEM JANUARY 20 , 2026 ONE Pleasanton Strategic Goal: Investing In Our Environment•City Council Priorities:•Strategy 2: Asset Management Planning•Strategy 3: Fund and implement PFAS water supply solutions.•Also•Strategy 4: Complete the Water System Master Plan•Strategy 8: Update the Sewer System Master Plan•Strategy 9: Develop the Stormwater Master Plan

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2 Public Works Utilities Division - Goals•Protect public health and the environment•Ensures compliance with State and Federal regulations•Maintains critical infrastructure reliability•Plans responsibly for long-term system sustainability FY 2025/26 Mid-Year Key Takeaways•Regulatory programs are being fully implemented•Long-Term infrastructure needs for water system is secured through the water rate study and adjustment starting 1/1/2026•Long-Term infrastructure needs for sewer system requiring future rate adjustment is under study.•Sanitary sewer system recorded ZEROoverflows in 20254

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3 Water System Financial Report At A Glance•Financial Health•Bond: 2024 Water Revenue Bond (6/2024-6/2027)Total $19 million Bond with 4.11% interest costTotal expended/ encumbered $13.7 millionRemaining encumbrance $5.3 million•FY25/26 CIP Investment: $11.5 million•FY25/26 Operating Budget: $38 million5 Key Water CIP EffortsStatusProjectCompletedCIP #24172 Bernal Ave Water Line and Turnout #1Completed. On budgetedWater System Management PlanCompleting Feasibility StudyCIP #24174 Regional Groundwater Facility ProjectIn construction. CIP #24171 Turnout #4 and Stoneridge Dr . & Sunol Water MainIn construction. CIP # 24181 Turnout #4 ProcurementOn schedule, In Construction. On BudgetWater System Emergency Power Improvements ProgramOn Schedule, Project is advertised. Additional budget for construction neededWater Meter and AMI System ReplacementOn schedule, In Design. On BudgetAnnual Water Distribution ImprovementsOn-Hold, Completed design.Pending Construction Budget and competing priorities.Lemoine Bypass PipelineOn-Hold. System is in good condition. Comprehensive management plan postponed to 2027/2028Recycled Water System Management PlanOn-Hold. System is in good condition.The fund is reserved for emergency situation.Annual Recycled Water Repair & Replacement6

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4 Water System-Current Regulatory Compliance Efforts•PFAs monitoring, reporting, and management•Making Conservation a California Way of Life Regulation•Water Loss Control Program•Urban Water Management Plan•AB 1572 Nonfunctional Turf Ban•Cross-Connection Control Program•Lead and Copper Rule•Annual Water Quality Report (Consumer Confidence Report)•Public Notifications-TTHM/ HAA5 exceedance limit at Kilkare area7 Regulatory Compliance Timeline20252027202820292030 -20401/27-PFAs initial monitoring/ testing1/29-Implement PFAs Treatment/ Mitigation1/27-Comply with UWMP1/28-Comply with City Performance Standards and State specified water loss target7/26-Council accept UWMP1/27-Compliance by properties owned by City1/28-Compliance by all other institutional and commercial properties1/29-Compliance by HOA, common interest devlp., and community service org.7/28-Identify hazard area7/35-Complete hazard assessments11/27-Submit Baseline Lead Service Line Inventory to SWB1/29-Establish 10 year funding for replacement program for service linePFAsUWMPAB1572 Non-Functional Turf1/31 Compliance by all govt. facilities in disadvantaged communitiesCross Connection/ Backflow7/25-Updated municipal Code and implement requirement on new applicationLead and Copper 1/39-Complete replacement of LCRI service line by 20392026

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5 Sanitary Sewer System At A Glance•Financial Health•Sewer Rate Study: Prop 218 July 2026; Effective New Sewer Rate: 1/1/2027•FY25/26 CIP Investment: $5.96 million•FY25/26 Operating Budget: $19.3 million•Sewer Treatment Fee: $14 million•Sewer Operations: $5.3 million9 Sewer System - Current Regulatory Compliance Efforts•Sewer Pipe Blockage Control Program (FOG)•Sewer System Condition Assessment- Closed Circuit Television (CCTV)•Force Main Inspection Program •Lift Station Inspection Program•Sewer Siphon Inspection Program10CITY OF PLEASANTONZero Sanitary Sewer Overflows (SSO) 2025

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6 Key Sanitary Sewer CIP EffortsStatusProjectCompletedOn BudgetSewer Capacity EvaluationCompletedOn BudgetSewer System Management PlanCompletedNot budgetedDenker Drive Emergency RepairsOn schedule, In implementationOn BudgetAnnual Sewer Inspection System ImprovementsOn schedule, At 65% design. Target to start construction Summer 2026.On BudgetEmergency Power ImprovementsOn schedule, In ConstructionOn BudgetLift Station S-14 Electrical ImprovementsOn schedule, In DesignOn BudgetSunol Blvd Sewer Improvements11 Danker Drive Emergency Project $650,000
12

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7 Storm Drain System At A Glance•Financial Health•Supported by General Fund•2025-2028: Establish comprehensive Storm Water Management Plan•2029-2031: Establish revenue sources to support City’s Storm Water Infrastructure•FY25/26 CIP Investment: $12.84 million•FY25/26 Operating Budget: $1.7 million•Minimum maintenance and repair and replacement work13 Key Storm Drain CIP EffortsStatusProjectCompletedOn BudgetAnnual Storm Repair/ Replacement (Puri Court)Design. On Schedule and BudgetSycamore Creek Storm Drain ImprovementsDesign. On Schedule and BudgetSycamore Creek Storm Improvements (Sycamore Road)Design. On Schedule and BudgetAugustin Bernal Trail Creek Crossing Culverts and Retaining WallDesign. On Schedule and BudgetEast Vineyard Detention Pond Outfall RepairDesign. On Schedule and BudgetOak Tree Farm Outfall and Channel StabilizationDesign. On Schedule and BudgetPark Pathway Restoration (Alviso Adobe & Tawny Parks)Design on scheduleSassafras Court Storm Drain InterceptorImplementation on scheduleStorm Water System Management PlanReserveAnnual Storm Water Repair and ReplacementReserveAnnual Installation of Trash Capture Devices14

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8 Stormwater Permit Compliance & Operations (MRP 3.0)15•Maintain 100% trash load reduction through full trash capture devices, enhanced street sweeping, and hotspot cleanups•Implement green infrastructure strategies in public and private projects to improve stormwater quality•Conduct business, industrial, and construction inspections to ensure stormwater BMP compliance•Respond to and enforce illicit discharges•Coordinate regionally through the Alameda Countywide Clean Water Program (ACCWP)•Completed 60 catch basin cleanings and addressed 53 hotspot locations•Inspected and cleaned all 140 full trash capture devices•Ongoing winter storm maintenance to reduce flooding and protect water quality Questions and Answers16

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Pleasanton City CouncilJanuary 20, 2026

Pleasanton City Council
January 20, 2026