TOWN OF PORTOLA VALLEY
Regular Meeting of the Town Council
Wednesday, September 24, 2025
7:00 PM
A G E N D A
Judith Hasko, Mayor
Craig Taylor, Vice Mayor
Rebecca Flynn, Councilmember
Mary Hufty, Councilmember
Helen Wolter, Councilmember
HISTORICSCHOOLHOUSE- 765PortolaRoad,PortolaValley,CA 94028 Mayor Judith Hasko will be participating remotely from Warren Street Hotel, 86 Warren St., Room 708, New York, NY 10007
Remote Public Comments: Meeting participants are encouraged to submit public comments in writing in advance of the meeting. Please submit your comments using this online form by 1:00 PM on the day of the meeting. Time permitting, your correspondence will be uploaded to the website. All received questions will be forwarded to Council, Commission, or Committee members for consideration during the meeting and included in the public record. Additionally, technology permitting, the public body will take questions using the Raise Hand button for those who attend the meeting online or by phone. Phone callers may provide comments by pressing *9 on their phone to "raise your hand" and *6 to mute/unmute themselves. The meeting Chair will call on people to speak by the phone number calling in. Remote participation is provided as a supplemental way to provide public comment, but this method does not always work. The public is encouraged to attend in person to ensure full participation.
In-Person Public Comments: Please fill out and submit a Public Comment card to the Town Clerk or Mayor prior to speaking. The Mayor will call your name at the appropriate time. Each speaker’s time is limited to three (3) minutes. The Mayor reserves the right to limit speakers’ time, depending upon the number of speakers or other circumstances.
Assistance for People with Disabilities: In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the Town Clerk at (650) 851-1700 or by email at [email protected]. Notification 48 hours prior to the meeting will enable the Town to make reasonable arrangements to ensure accessibility to this meeting.
1. CALL TO ORDER / ROLL CALL
2. A.B. 2449 CONSIDERATIONS: Announcements/Consideration and approval of request to attend remotely by Town Council, pursuant to AB 2449 (just cause and emergency circumstances).
VIRTUAL PARTICIPATION VIA ZOOM
To access the meeting by computer:
https://us06web.zoom.us/j/82257978185?pwd=wMtXrlq34exU129MBBHJuzaVbSHL35.1 Webinar ID: 822 5797 8185
Passcode: 048294
To access the meeting by phone:
1-669-900-6833 or 1-888-788-0099 (toll-free)
Mute/Unmute – Press *6 / Raise Hand – Press *9
Town Council Agenda
September 24, 2025
3. PRESENTATIONS / PROCLAMATIONS
a. Acceptance of the Eagle Scout Plaque for Town Archives
4. TOWN MANAGER REPORT
There are no written materials, and the Town Council does not take action under this agenda item.
5. ORAL COMMUNICATIONS
Persons wishing to address the Town Council on any subject may do so now. Please submit a speaker’s slip located at the back of the room to the Town Clerk or Mayor, prior to speaking. Please note the Council is not able to undertake extended discussion or action on items not on the agenda. Each speaker’s time is limited to three (3) minutes.
6. CONSENT AGENDA
a. Approve Regular Meeting Minutes of September 10, 2025 b. Approve Warrant List of September 24, 2025
c. Consider Approval of an Amendment to the Town of Portola Valley Conservation Committee Charter
7. REGULAR AGENDA
a. Consider Acceptance of the FY 2021-22 Annual Comprehensive Financial Report b. Verbal Update from Revenue Enhancement Options Subcommittee
8. COUNCIL SUBCOMMITTEE, LIAISON COMMITTEE, AND REGIONAL AGENCIES
REPORTS
Oral and written reports arising out of Council subcommittee and liaison appointments to both in-town and regional committees and initiatives. The Town Council does not take action under this agenda item.
9. ADJOURNMENT
The next Regular Town Council meeting will be held on September 24, 2025, at 7:00 p.m. *************************************************************************************************************************************** Land Acknowledgement:
The Town of Portola Valley acknowledges the colonial history of this land we dwell upon the unceded territory of the Ramaytush (rah-my-toosh) Ohlone, Tamien Nation, and Muwekma (mah-WEK- mah) Ohlone, who endured a human and cultural genocide that included removal from their lands and their sacred relationship to the land. Portola Valley recognizes that we profit from the commodification of land seized from indigenous peoples and now bear the ecological consequences. We seek to understand the impact of these legacies on all beings and to find ways to make repair.
Volume 47
September 10, 2025
PORTOLA VALLEY TOWN COUNCIL REGULAR MEETING MINUTES – SEPTEMBER 10, 2025
1. CALL TO ORDER / ROLL CALL
Mayor Hasko called the meeting to order at 7:00 p.m. Roll call was taken by the Clerk.
Present: Councilmembers Helen Wolter, Rebecca Flynn, Mary Hufty, Vice Mayor Craig Taylor, Mayor Judith Hasko
Absent: None
Others: Town Manager Darcy Smith, Town Attorney Catherine Engberg, Special Projects Manager Terrence Grindall, Former Interim Town Manager Mark Linder, Town Clerk Veronica Dao
2. A.B. 2449 CONSIDERATIONS: Announcements/Consideration and approval of request to attend remotely by Town Council, pursuant to AB 2449 (just cause and emergency circumstances) – None
3. PRESENTATIONS / PROCLAMATIONS
a. Proclamation Designating September 2025 as Suicide Prevention Month Mayor Hasko introduced San Mateo County Behavioral Health Commissioner Leticia Bidó and Youth Action Board member Ariya Kaushek. They provided remarks and accepted the proclamation.
4. TOWN MANAGER REPORT
Town Manager Smith updated the Council on the following:
• Zotts to Totts and Town Picnic on September 20
• Road closures for the event
• FY21-22 financial audits scheduled for the next Council meeting
5. ORAL COMMUNICATIONS
The following members of the public addressed the Town Council:
• Rita Comes
6. CONSENT AGENDA
Mayor Hasko invited public comment. None were received.
Consent Agenda items 6a and 6d were pulled for separate discussion and action.
Item #6a
Volume 47
September 10, 2025
Motion and second (Flynn, Taylor) to approve Consent Agenda items 6b and 6c. The motion carried unanimously by voice vote.
Motion and second (Taylor, Hufty) to approve Consent Agenda item 6a. The motion carried unanimously by voice vote.
Motion and second (Flynn, Taylor) to approve Consent Agenda item 6d. The motion carried unanimously by voice vote.
a. Approve Regular Meeting Minutes of August 27, 2025
b. Approve Warrant List of September 10, 2025
c. Consider Accepting the Updated Reimbursement Policy
d. Consider Appointing Mayor Judith Hasko as the Voting Delegate, and Vice Mayor Craig Taylor and Councilmember Mary Hufty as the Alternate Delegates to Represent the Town of Portola Valley at the Annual General Assembly at the 2025 League of California Cities Annual Conference
7. REGULAR AGENDA
Mayor Hasko recused herself as she lives within the conflict-of-interest radius of the project site and left the room at 7:15 pm. Vice Mayor Taylor chaired the meeting for items 7a and 7b.
a. Consider Adoption of a Resolution Appropriating $70,026.76 for Town Planning Fees from the Town of Portola Valley Affordable Housing Fund to Jim White and Patty White for the Willow Commons Housing Project Owned by IACPV LLC at 4388 Alpine Road and Determining the Project is Exempt under the California Environmental Quality Act
Special Projects Manager Grindall presented the item.
Vice Mayor Taylor invited public comment.
Public Comment
• Rita Comes
Council asked questions and discussed the item.
Motion and second (Flynn, Hufty) to reimburse $70,026.26 of Planning Fees from the Affordable Housing Fund. The motion carried 4-0-1 by voice vote, with Mayor Hasko recused.
Volume 47
September 10, 2025
b. Consider Adoption of a Resolution Appropriating up to $3.5 Million from the Town of Portola Valley Affordable Housing Fund to Jim White and Patty White for the Willow Commons Housing Project Owned by IACPV LLC at 4388 Alpine Road, Authorizing the Town Manager to Enter into an Affordable Housing Grant Agreement, and Determining the Project is Exempt under the California Environmental Quality Act
Former Interim Town Manager Linder presented the item.
Vice Mayor Taylor invited public comment.
Public Comment
• Eiri Inenaga
• Jimmy Inenaga
• Tim Clark
• Betsy Morgenthaler
• Judith Murphy
• Rita Comes
• Ron Eastman
• Dale Pfau
• Karen Askey
• Sarah Wernikoff
• Greg
Council asked questions and discussed the item.
Motion and second (Flynn, Hufty) to approve the resolution to appropriate $1.35 million from the Affordable Housing Fund. The motion carried 4-0-1 by voice vote, with Mayor Hasko recused.
The Council recessed for a short break at 9:39 p.m. and returned at 9:50 p.m., with Mayor Hasko returning as well.
8. COUNCIL SUBCOMMITTEE, LIAISON COMMITTEE, AND REGIONAL AGENCIES
REPORTS
Councilmembers reported on several local and regional meetings they attended recently.
9. ADJOURNMENT
The meeting adjourned at 9:50 p.m.
Volume 47
September 10, 2025
_________________________ _________________________
Judith Hasko, Mayor Veronica Dao, Town Clerk
Submitted for approval to the Town Council at its September 24, 2025 regular meeting.
______________________________________________________________________________________ TO: Mayor and Members of the Town Council
FROM: Tony McFarlane, Finance Director
DATE: September 24, 2025
RE: Review and Accept Warrant List
RECOMMENDATION:
1. Review and accept the following Warrant List for the month of September:
09/24/2025 Warrant List
REPORT SUMMARY
The following table lists warrant activity by date, tracks starting and ending warrant numbers, and total amount of warrants issued.
The following table lists payments by fund.
Date
Ending
Warrant #
Warrant 9/24/2025 5433 5432 0 - 9/25/2025 9/10/2025 5432 Attached are Warrant Lists for:
Prior Warrant List
Type of Warrant Date
Starting
Warrant #
Ending
Warrant #
Total
Warrants Amount
Warrants
Released
Fund Date Amount
General 9/10/2025 53,704.69
Customer Deposits 9/10/2025 16,219.02
Total $ 69,923.71
Payments by Fund
TOWN OF PORTOLA VALLEY
STAFF REPORT
Item #6b
Warrant List September 24, 2025
The following table lists the warrants issued as EFT/ACH payments. EFT/ACH payments are recurring payments for contributions related to retirement and deferred compensation, workers’ compensation premiums, and utilities, etc.
The following table lists the warrants that were voided and the reason for the voided transaction.
The following table lists the warrants issued outside of the scheduled warrant list cycle for various reasons, such as processing error, reissuing a voided check, or employee separation.
DISCLOSURE
For additional information on any item disclosed in this report, please contact the Finance department directly at [email protected].
ATTACHMENTS
1. 09/24/2025 Warrant List Certification
Date Warrant # Issued to Fund Dept Purpose Amount
9/24/2025 5434 Bank of America 101 Various Aug Credit Card $ 8,541.23 9/24/2025 5437 CalPERS 101 140 GASB 68 Valuation 350.00 9/24/2025 5440 Missionsquare Retirement 101 Various Sep Contributions 4,551.64 9/24/2025 5445 Navia Benefit Solutions 101 Various Sep Contributions 1,048.20 9/24/2025 5446 PG&E 101 610 Sep Utilities 1,496.84
9/24/2025 5456 Amazon Capital Services 101 Various Office Supplies 351.27 Warrants issued as ACH/EFT
Date Warrant # Issued to Fund Dept Reason Amount
Warrants Voided and Reissued
Date Warrant # Issued to Fund Dept Purpose Amount
Warrants Issued Outside of a Scheduled Warrant List
Date Warrant # Issued to Fund Dept Purpose Amount
Disclosure
TOWN OF PORTOLA VALLEY
Warrant Disbursement Journal
September 24, 2025
Claims totaling $69,923.71 having been duly examined by me and found to be correct are hereby approved and verified by me as due bills against the Town of Portola Valley.
Date _____________________________ ________________________________ Corie Stocker, Assistant Town Manager
Motion having been duly made and seconded, the above claims are hereby approved and allowed for payment.
Signed and sealed this (Date) _____________________
_______________________________ _________________________________ Anthony McFarlane, Finance Director Mayor
Item #6b - Attachment 1
apachreg Town of Portola Valley mmagahiz 09/18/2025 10:14 Page 1 Check Register
Check Vendor Vendor Name Check Check BW CheckNumber Number Amount Date TypeChecks for Cash Account: 910-11011-000 5433 41 AT&T 302.39 09/24/255434 44 BANK OF AMERICA 8,541.23 09/24/25 EFTPS5435 55 BILL HAMILTON ROOFING 1,000.00 09/24/255436 78 CALIFORNIA WATER SERVICE CO 15,544.26 09/24/255437 80 CALPERS 350.00 09/24/25 EFTPS5438 124 COMCAST 748.43 09/24/255439 203 GREEN HALO SYSTEMS 114.00 09/24/255440 218 MISSIONSQUARE RETIREMENT 4,551.64 09/24/25 EFTPS5441 261 JON MYERS 500.00 09/24/255442 276 KUTZMANN & ASSOCIATES 12,219.02 09/24/255443 282 LAUTZENHISERS STATIONERY 325.58 09/24/255444 324 MIRANDAS LANDSCAPE 5,967.00 09/24/255445 330 NAVIA BENEFIT SOLUTIONS 1,048.20 09/24/25 EFTPS5446 367 PG&E 1,496.84 09/24/25 EFTPS5447 372 PINNACLE BUILDING & DESIGN 1,000.00 09/24/255448 376 PORTOLA VALLEY HARDWARE 124.09 09/24/255449 403 RON RAMIES AUTOMOTIVE INC. 1,369.22 09/24/255450 437 SMALL BUSINESS BENEFIT PLAN TR 2,303.00 09/24/255451 445 STANDARD INSURANCE CO. 543.13 09/24/255452 860 STEPFORD 621.50 09/24/255453 1037 BAY AREA REROOFING 1,000.00 09/24/255454 1076 KRISTY MODING 100.00 09/24/255455 1118 STERICYCLE, LNC. DBA SHRED-LT 119.04 09/24/255456 1152 AMAZON CAPITAL SERVICES, INC 351.27 09/24/25 EFTPS5457 1182 KELLY FEDORUK 100.00 09/24/255458 1186 AT&T CORP DBA ACC BUSINESS 735.08 09/24/255459 1216 WIZIX TECHNOLOGY GROUP, INC. 82.97 09/24/255460 1279 LISA SPRINGS 71.82 09/24/255461 1280 MARGARET ANDERSON 350.00 09/24/255462 1281 JENNIFER DER YUEN 364.00 09/24/255463 1282 ROTARY CLUB OF MENLO PARK 130.00 09/24/255464 1283 TIME CHANGE ROOFING 1,000.00 09/24/255465 1284 CHRIST EPISCOPAL CHURCH 1,000.00 09/24/255466 1285 PARAND BUCELLA 100.00 09/24/255467 1286 THE LEW EDWARDS GROUP 5,750.00 09/24/25Check totals: 53,584.53ACH totals:EFTPS totals: 16,339.18Wire transfer totals:Payment Manager totals:GRAND TOTALS 69,923.71
Check totals: 53,584.53
ACH totals:EFTPS totals: 16,339.18Wire transfer totals:Payment Manager totals:GRAND TOTALS 69,923.71
apackfnd2 Town of Portola Valley mmagahiz 09/18/2025 10:15 Page 1 Checks by Fund - 09/24/25 to 09/24/25
Vendor Name Account Invoice Invoice Amount Check Check
Compressed Description Number Date
Formatted
Fund 101 Dept Balance SheetCHRIST EPISCOPAL CHURCH 101-21051-000-000000 Deposit Refund - 1,000.00 5465 09/24/25 Community HallJON MYERS 101-21052-000-000000 Field Rental 500.00 5441 09/24/25 Deposit Refund
KELLY FEDORUK 101-21052-000-000000 Field Deposit 100.00 5457 09/24/25 Refund - Picnic Spaces
KRISTY MODING 101-21052-000-000000 Field Deposit 100.00 5454 09/24/25 Refund - Picnic Table
MISSIONSQUARE RETIREMENT 101-21036-000-000000 Deferred Comp - Sep 4,551.64 5440 09/24/25 15, 2025
NAVIA BENEFIT SOLUTIONS 101-21033-000-000000 Navia Benefit 343.33 5445 09/24/25 09/15/2025
PARAND BUCELLA 101-21052-000-000000 Field Deposit 100.00 5466 09/24/25 Refund - Picnic Spaces
ROTARY CLUB OF MENLO PARK 101-21052-000-000000 Litter Deposit 130.00 5463 09/24/25 Refund
--------------
Fund 101 Dept Total 6,824.97
Fund 101 Dept 115 Town CommitteesBANK OF AMERICA 101-63208-115-000000 August Credit Card 3,752.34 5434 09/24/25 Statement
--------------
Fund 101 Dept 115 Total 3,752.34
Fund 101 Dept 120 Town ManagerBANK OF AMERICA 101-65014-120-000000 August Credit Card 898.00 5434 09/24/25 Statement
SMALL BUSINESS BENEFIT PLAN TR 101-55024-120-000000 Dental/Vision 2,303.00 5450 09/24/25 STANDARD INSURANCE CO. 101-55031-120-000000 LTD/Life Premium 543.13 5451 09/24/25 --------------
Fund 101 Dept 120 Total 3,744.13
Fund 101 Dept 130 Town ClerkBANK OF AMERICA 101-65012-130-000000 August Credit Card 250.00 5434 09/24/25 Statement
LAUTZENHISERS STATIONERY 101-62301-130-000000 Town Council Minute 325.58 5443 09/24/25 Book
apackfnd2 Town of Portola Valley mmagahiz 09/18/2025 10:15 Page 2 Checks by Fund - 09/24/25 to 09/24/25
Vendor Name Account Invoice Invoice Amount Check Check
Compressed Description Number Date
Formatted
--------------
Fund 101 Dept 130 Total 575.58
Fund 101 Dept 140 FinanceCALPERS 101-62031-140-000000 GASB-68 350.00 5437 09/24/25 --------------
Fund 101 Dept 140 Total 350.00
Fund 101 Dept 320 Building DivisionGREEN HALO SYSTEMS 101-62305-320-000000 Sept Hosting & 114.00 5439 09/24/25 Access
--------------
Fund 101 Dept 320 Total 114.00
Fund 101 Dept 410 Community HallJENNIFER DER YUEN 101-43121-410-000000 CPASS Refund 364.00 5462 09/24/25LISA SPRINGS 101-43121-410-000000 CPASS Refund 71.82 5460 09/24/25MARGARET ANDERSON 101-43121-410-000000 CPASS Refund 350.00 5461 09/24/25 --------------
Fund 101 Dept 410 Total 785.82
Fund 101 Dept 420 Field RentalsMIRANDAS LANDSCAPE 101-61055-420-000000 Jul Landscape 3,159.00 5444 09/24/25 Services MIRANDAS LANDSCAPE 101-61055-420-000000 Aug Landscape 2,808.00 5444 09/24/25 Services --------------
Fund 101 Dept 420 Total 5,967.00
Fund 101 Dept 510 Public WorksBANK OF AMERICA 101-62014-510-000000 August Credit Card 465.14 5434 09/24/25 Statement
PORTOLA VALLEY HARDWARE 101-62014-510-000000 August Statement 124.09 5448 09/24/25 Tools
RON RAMIES AUTOMOTIVE INC. 101-61081-510-000000 2001 Speed Trailer 972.04 5449 09/24/25 Sherrif BatteryRON RAMIES AUTOMOTIVE INC. 101-61081-510-000000 Aug Fuel Statement 397.18 5449 09/24/25 --------------
Fund 101 Dept 510 Total 1,958.45
apackfnd2 Town of Portola Valley mmagahiz 09/18/2025 10:15 Page 3 Checks by Fund - 09/24/25 to 09/24/25
Vendor Name Account Invoice Invoice Amount Check Check
Compressed Description Number Date
Formatted
Fund 101 Dept 610 Non-DepartmentalAMAZON CAPITAL SERVICES, INC 101-62301-610-000000 Ergonomic Mouse 21.65 5456 09/24/25 AMAZON CAPITAL SERVICES, INC 101-62301-610-000000 Cable Matters 2-pk 95.63 5456 09/24/25 AMAZON CAPITAL SERVICES, INC 101-62301-610-000000 Office Desk Name 26.15 5456 09/24/25 Plate
AMAZON CAPITAL SERVICES, INC 101-62301-610-000000 Metal Book Adj 6.54 5456 09/24/25 Stand Holder
AMAZON CAPITAL SERVICES, INC 101-62301-610-000000 Febreze Air 30.14 5456 09/24/25 Freshener
AMAZON CAPITAL SERVICES, INC 101-62301-610-000000 Ergonomic Mouse 95.10 5456 09/24/25AMAZON CAPITAL SERVICES, INC 101-62301-610-000000 Wireless Keyboard 28.04 5456 09/24/25AMAZON CAPITAL SERVICES, INC 101-62301-610-000000 GreenWorks Heavy 48.02 5456 09/24/25 Duty Compostable Forks CertifiedUtensils
AT&T 101-62021-610-000000 August Statement 60.69 5433 09/24/25AT&T 101-62021-610-000000 August Statement 181.01 5433 09/24/25AT&T 101-62021-610-000000 August Statement 60.69 5433 09/24/25AT&T CORP DBA ACC BUSINESS 101-62021-610-000000 ACC Division of 735.08 5458 09/24/25 AT&TEthernet/InternetAccess Sept Stmt
BANK OF AMERICA 101-62305-610-000000 August Credit Card 2,379.43 5434 09/24/25 Statement
101-62399-610-000000 653.41 5434 09/24/25101-62331-610-000000 142.91 5434 09/24/25 CALIFORNIA WATER SERVICE CO 101-62022-610-000000 Water Service 588.68 5436 09/24/25 8/12/25 - 9/10/25
101-62022-610-000000 4,388.14 5436 09/24/25101-62022-610-000000 1,747.56 5436 09/24/25101-62022-610-000000 379.34 5436 09/24/25 101-62022-610-000000 8,323.45 5436 09/24/25
101-62022-610-000000 70.26 5436 09/24/25101-62022-610-000000 46.83 5436 09/24/25 COMCAST 101-62021-610-000000 WIFI-9.21.2025-10.2 232.27 5438 09/24/25 .2025
COMCAST 101-62021-610-000000 WIFI-9.16.2025-10.1 516.16 5438 09/24/25 .2025
NAVIA BENEFIT SOLUTIONS 101-55025-610-000000 Navia Flexible 704.87 5445 09/24/25 Benefit Plan 2024Balance Due
PG&E 101-62022-610-000000 August Statement 102.01 5446 09/24/25 July Usage
101-62022-610-000000 14.29 5446 09/24/25101-62022-610-000000 14.58 5446 09/24/25101-62022-610-000000 1,258.61 5446 09/24/25101-62022-610-000000 92.77 5446 09/24/25101-62022-610-000000 14.58 5446 09/24/25
apackfnd2 Town of Portola Valley mmagahiz 09/18/2025 10:15 Page 4 Checks by Fund - 09/24/25 to 09/24/25
Vendor Name Account Invoice Invoice Amount Check Check
Compressed Description Number Date
Formatted
STEPFORD 101-62305-610-000000 Veeam Backup and 621.50 5452 09/24/25 Replication for Disaster Recovery - Sep 25
STERICYCLE, LNC. DBA SHRED-LT 101-62301-610-000000 Paper Shredding 119.04 5455 09/24/25 ServicesTHE LEW EDWARDS GROUP 101-62099-610-000000 Aug Consultanting 5,750.00 5467 09/24/25 Services WIZIX TECHNOLOGY GROUP, INC. 101-62301-610-000000 Printer 82.97 5459 09/24/25 --------------
Fund 101 Dept 610 Total 29,632.40
--------------
Fund 101 Total 53,704.69
Fund 701 Dept 340 Customer DepositsBAY AREA REROOFING 701-62325-340 Deposit Refund - 1,000.00 5453 09/24/25 128 Santa Maria AveBILL HAMILTON ROOFING 701-62325-340 Deposit Refund - 1,000.00 5435 09/24/25 121 Escobar Rd
KUTZMANN & ASSOCIATES 701-62041-340 Aug 25 Plan Checks 12,219.02 5442 09/24/25PINNACLE BUILDING & DESIGN 701-62325-340 Deposit Refund - 1,000.00 5447 09/24/25 501 Portola Rd Unit 4J
TIME CHANGE ROOFING 701-62325-340 Deposit Refund - 45 1,000.00 5464 09/24/25 Bear Paw
--------------
Fund 701 Dept 340 Total 16,219.02
--------------
Fund 701 Total 16,219.02
--------------
**** Grand Total 69,923.71
* * * End of Report * * *
.
apapdinv2 mmagahiz Town of Portola Valley Page 1
10:15 09/18/25 Paid Invoices by Date
From: 09/24/2025 to 09/24/2025
Check Check Special Information Net Check Total Invoice Number Date Number Amount Invoices
Paid
Vendor: 41 AT&T
09/24/25 5433 August Statement 302.39 60.69 000024026527 August Statement 181.01 000024026528August Statement 60.69 000024026529 Vendor: 44 BANK OF AMERICA
5434 August Credit Card Statement 8,541.23 8,541.23 1388-AUG25 Vendor: 55 BILL HAMILTON ROOFING
5435 Deposit Refund - 121 Escobar Rd 1,000.00 1,000.00 BLDR0239-2025 Vendor: 78 CALIFORNIA WATER SERVICE CO
5436 Water Service 8/12/25 - 9/10/25 15,544.26 15,544.26 AUG-2025 Vendor: 80 CALPERS
5437 GASB-68 350.00 350.00 100000018034242
Vendor: 124 COMCAST
5438 WIFI-9.16.2025-10.15.2025 748.43 516.16 7290-SEP25 WIFI-9.21.2025-10.20.2025 232.27 1945-OCT25
Vendor: 203 GREEN HALO SYSTEMS
5439 Sept Hosting & Access 114.00 114.00 5987
Vendor: 218 MISSIONSQUARE RETIREMENT
5440 Deferred Comp - Sep 15, 2025 4,551.64 4,551.64 SEP-202515 Vendor: 261 JON MYERS
5441 Field Rental Deposit Refund 500.00 500.00 PROF-25-27 Vendor: 276 KUTZMANN & ASSOCIATES
5442 Aug 25 Plan Checks 12,219.02 12,219.02 2326825
Vendor: 282 LAUTZENHISERS STATIONERY
5443 Town Council Minute Book 325.58 325.58 13358
Vendor: 324 MIRANDAS LANDSCAPE
5444 Jul Landscape Services 5,967.00 3,159.00 2307
Aug Landscape Services 2,808.00 2308
Vendor: 330 NAVIA BENEFIT SOLUTIONS
5445 Navia Benefit 09/15/2025 1,048.20 343.33 09152025
Navia Flexible Benefit Plan 2024 Balance Due 704.87 14535
.
apapdinv2 mmagahiz Town of Portola Valley Page 2
10:15 09/18/25 Paid Invoices by Date
From: 09/24/2025 to 09/24/2025
Check Check Special Information Net Check Total Invoice NumberDate Number Amount Invoices Paid
Vendor: 367 PG&E
5446 August Statement July Usage 1,496.84 1,496.84 AUG-2025 Vendor: 372 PINNACLE BUILDING & DESIGN
5447 Deposit Refund - 501 Portola Rd Unit 4J 1,000.00 1,000.00 BLDR0237-2025 Vendor: 376 PORTOLA VALLEY HARDWARE
5448 August Statement Tools 124.09 124.09 193-AUG25
Vendor: 403 RON RAMIES AUTOMOTIVE INC.
5449 Aug Fuel Statement 1,369.22 397.18 G20250831-2
2001 Speed Trailer Sherrif Battery 972.04 81416
Vendor: 437 SMALL BUSINESS BENEFIT PLAN TR
5450 Dental/Vision 2,303.00 2,303.00 OCT-2025
Vendor: 445 STANDARD INSURANCE CO.
5451 LTD/Life Premium 543.13 543.13 2025-AUG
Vendor: 860 STEPFORD
5452 Veeam Backup and Replication for Disaster Recovery - Sep 25 621.50 621.50 2502083 Vendor: 1037 BAY AREA REROOFING
5453 Deposit Refund - 128 Santa Maria Ave 1,000.00 1,000.00 BLDR0113-2024 Vendor: 1076 KRISTY MODING
5454 Field Deposit Refund - Picnic Table 100.00 100.00 PROF-25-51 Vendor: 1118 STERICYCLE, LNC. DBA SHRED-LT
5455 Paper Shredding Services 119.04 119.04 8011853320
Vendor: 1152 AMAZON CAPITAL SERVICES, INC
5456 GreenWorks Heavy Duty Compostable Forks Certified Utensils 351.27 48.02 1YCD-MWXR-3JW9 Ergonomic Mouse 95.10 1R6Q-69KT-9CM6Febreze Air Freshener 30.14 1PQN-P37X-3K9MWireless Keyboard 28.04 1WN7-9NQN-HT3VErgonomic Mouse 21.65 113C-6LXM-C1DFOffice Desk Name Plate 26.15 1FRC-RFLM-3PDYCable Matters 2-pk 95.63 1CM9-411L-43QYMetal Book Adj Stand Holder 06.54 1FT7-77Q7-VLYL Vendor: 1182 KELLY FEDORUK
5457 Field Deposit Refund - Picnic Spaces 100.00 100.00 PROF-25-48
.
apapdinv2 mmagahiz Town of Portola Valley Page 3
10:15 09/18/25 Paid Invoices by Date
From: 09/24/2025 to 09/24/2025
Check Check Special Information Net Check Total Invoice NumberDate Number Amount Invoices Paid
Vendor: 1186 AT&T CORP DBA ACC BUSINESS
5458 ACC Division of AT&T Ethernet/Internet Access Sept Stmt 735.08 735.08 8969268016 Vendor: 1216 WIZIX TECHNOLOGY GROUP, INC.
5459 Printer 82.97 82.97 522018
Vendor: 1279 LISA SPRINGS
5460 CPASS Refund 71.82 71.82 042358630
Vendor: 1280 MARGARET ANDERSON
5461 CPASS Refund 350.00 350.00 41463169
Vendor: 1281 JENNIFER DER YUEN
5462 CPASS Refund 364.00 364.00 42875751
Vendor: 1282 ROTARY CLUB OF MENLO PARK
5463 Litter Deposit Refund 130.00 130.00 SEP-25-3
Vendor: 1283 TIME CHANGE ROOFING
5464 Deposit Refund - 45 Bear Paw 1,000.00 1,000.00 BLDR0263-2025 Vendor: 1284 CHRIST EPISCOPAL CHURCH
5465 Deposit Refund - Community Hall 1,000.00 1,000.00 PRCH-25-44 Vendor: 1285 PARAND BUCELLA
5466 Field Deposit Refund - Picnic Spaces 100.00 100.00 PROF-25-54 Vendor: 1286 THE LEW EDWARDS GROUP
5467 Aug Consultanting Services 5,750.00 5,750.00 002
Check Date Totals 69,923.71
Grand Total 69,923.71
______________________________________________________________________________________ TO: Mayor and Members of the Town Council
FROM: Veronica Dao, Town Clerk
Darcy Smith, Town Manager
DATE: September 24, 2025
RE: Consider Approval of an Amendment to the Town of Portola Valley Conservation Committee Charter
RECOMMENDATION
Staff recommend that the Town Council, by motion, approve an Amendment to the Town of Portola Valley Conservation Committee Charter updating the regular meeting day and time.
DISCUSSION
At its August 26, 2025 meeting, the Committee discussed the proposal of updating the charter to change its meeting day from the fourth Tuesday to first Tuesday of every month and changing the meeting time from 7:00 p.m. to 5:30 p.m. The Committee voted unanimously to change the day and time (Attachment 1).
The Proposed Redlined Conservation Charter is provided for Council review and approval (Attachment 2).
FISCAL IMPACT
There is no fiscal impact associated with the proposed charter amendment.
ATTACHMENTS
1. Conservation Committee August 26, 2025 Draft Meeting Minutes
2. Proposed Redlined Conservation Charter
TOWN OF PORTOLA VALLEY
STAFF REPORT
Item #6c
TOWN OF PORTOLA VALLEY
Conservation Committee Meeting
August 26, 2025
7:00 PM
In-person meeting
Conservation Committee Meeting Minutes - Draft
1. CALL TO ORDER & ROLL CALL
The meeting was called to order at 7:01
Members present: N. Chiariello, T. Coleman, M. Plunder, M. Richards, J. Murphy, D.
Walz
Members absent: N. Freire, J. Zimmermann
Also present: E. McGavin, Rebecca (Town Council Liaison) Attendance Via zoom: D. Cardinal, D. Breen
2. ORAL COMMUNICATIONS FOR ITEMS NOT ON THE AGENDA
a. N. Chiariello is coordinating with B. Lipman, D. Breen on plans to plant poppies at “poppy corner” (Triangle Park, at the corner of Alpine and Portola Road). With permission of Public Works, they plan to place craft paper, cover with soil and wood chips and plant seeds. Woodside Priory provides soil. Timing TBD, pending timing of soil delivery.
b. N. Chiariello contacted Stanford about Dittrichia at Portola Terrace and Wedge.
Stanford responded that the site is scheduled for weed abatement, including stinkwort removal activities.
3. APPROVAL OF MINUTES
a. Approved unanimously (M. Richards abstain)
4. COMMITTEE BUSINESS
a. D. Walz moved for E. Low to become a student member; Approved unanimously b. Conservation Committee (CC) plans to have a table at the town picnic on 9/20.
M. Plunder will plan, J. Murphy and N. Chiariello to assist. c. M. Plunder mentioned an upcoming video by POST on “Living with Coyotes,” 8/28 at 7pm; M. Plunder will place a notice on the forum. d. M. Plunder revived the discussion of moving the CC’s standing meeting time to facilitate attendance by staff or guests; unless moved to the first Tuesday of the month, timing would conflict with finance committee meeting. N. Chiariello moved to ask Town Council to move the CC meeting to the first Tuesday of the month at 5:30 pm; Approved unanimously
e. M. Plunder met with the new town manager; items discussed included that an intern may be available to assist CC with tasks such as wildlife corridor mapping and the potential to make Portola Valley rat poison free. The manager will assist with coordinating meetings with Public Works.
Item #6c - Attachment 1
5. OLD BUSINESS
a. ADU checklist - review & resubmit to Town - deferred b. Wildlife Corridors / Habitat Preservation / Fencing Ordinance - Subcommittee report (Appendices A, B, C) (Chiariello); The subcommittee has concluded that the primary impediment to preserving permeability to wildlife in town is that one acre parcels are permitted to construct 6 foot tall fences on side and rear property lines. The subcommittee’s proposed changes would add a fence type (wildlife friendly); modify horse fences to require that they provide 16” of clearance above the ground; and require that domestic fences be set back by 10 feet in side and rear yards. More stringent setbacks and restrictions would still apply, unchanged, in front yards, at creeks and on steep hillsides. The subcommittee will continue to revise the proposed language based on the following discussion:
i. T. Coleman expressed an objection to the 10 foot setback, particularly in the case of fence replacement on sites with existing structures. ii. T. Coleman questions if horse fences pulled back from the property line are also required to have the bottom rail 16” off of the ground. J. Murphy and M. Richards clarified that this is not the intent, and the subcommittee will review and revise the language for clarity.
iii. D. Cardinal emphasized that all of PV is wildlife habitat, and fencing should not be allowed to exclude wildlife from property; the historic lack of fencing is a primary reason that PV is as wild as it is. iv. R. Flynn asked how the committee plans to address that ADUs are allowed to build within 4 feet of the property line; the Committee currently does not have plans to address that issue, and recognizes that ADUs could result in pinch points.
v. J. Murphy proposes to remove allowance for double fence within the building envelope. N. Chiariello suggests that we also define double fences and/or the minimum allowable distance between two parallel fences. D. Breen emphatically objects to double fencing anywhere. vi. R. Flynn asked for holistic clarification of permits and ASCC review requirements, not just limited to wildlife friendly requirements. She recommends the subcommittee consider grandfathering in existing fence locations.
c. Tip of the Month (Plunder) - Dittrichia removal. M. Richards noted that this is the end of nesting bird season, and is an excellent time to prune trees. This topic may be used next month.
d. What’s Blooming Now (Plunder) - Hemizonia is abundant at the Frog Pond and above the Priory.
e. Kudos (Murphy) - Highlight the mountain lion video on town website (item h). f. Committee Spotlight final - vote (Appendix D) (Plunder) - approved unanimously g. Community Hall How-To List - Meet with Corie Stocker TBD - skipped h. Educational Mountain Lion Video UC Davis - Update (Plunder) - the link is on the town website, searchable using “mountain lion video”
i. Student Owl Box - Almanac article published; new Owl box placement article draft - review (Appendix E) (Low) - M. Plunder will ask E. Low if she would like to include her name and/or contact information as the author. Typically, Committee publications are credited to the committee as a whole. T. Coleman requests that an issue date is added. M. Richards suggests clarifying the definition of “suitable hunting territory. ”
j. Rat Poison Free Portola Valley Initiative - update (Chiariello, Plunder) - N.
Chiariello notes that we need advice from the Council re: what is allowable beyond the Town’s existing resolution, within the limitations of current state regulations; R. Flynn will follow up. M. Plunder and J. Murphy will have information on rodenticides at the town picnic; N. Chiariello will chair a subcommittee to meet and discuss an update to the 2016 information prepared by the Committee, the potential to liaise with Woodside on any ordinances; and to revive the rodenticide presentation that was prepared and cancelled in 2020.
Subcommittee is Chiariello and Plunder; they will ask E. Low to join. k. Updated CC Site Visit Template - review (Appendix F) (Murphy, Plunder) Marianne will revise to include: date of site visit at the top; number of reviews (in project summary); and date report is submitted under “submitted by” l. Wildlife Inventory Project - update (Plunder) - skipped m. Committee / Townwide Cooperation
i. Frog Pond (Zimmermann) - deferred
ii. Open Space (OS) (Chiariello) - OS submitted a letter to Council re: the committee’s position on revenue options for balancing the town budget. iii. Public Works (Plunder) - Meet with Robert Burtt TBD iv. Trails and Paths (Coleman) - The committee noted that the base of shady trail is overgrown. The joint subcommittee on town-owned openspace will meet and recommend to public works that the area is mowed. v. Wildfire Preparedness (Plunder) - deferred
vi. ASCC (Plunder) - deferred
6. SITE PERMITS - not discussed
a. 1 Tynan Way (Chiariello) - pending
b. 120 Bear Gulch (Coleman) - pending
c. 11 Brookside drive (Plunder) - pending
d. 140 Degas (Walz) - done
e. 5 Veronica Court (Murphy) - done
f. 111 Escobar 3rd submittal (Richards) - done
g. 2 Hayfields resubmittal (Richards) - pending
h. 286 Willowbrook Murphy - done
7. TREE PERMITS - not discussed
a. 41 Stonegate (fence)
b. 10 Redberry
c. 180 Golden Oak
d. 501 Portola Road
e. 130 Solana
f. 180 Pinon
8. NEW BUSINESS - None
9. ADJOURNMENT at 9:03 pm
a. The next regularly scheduled meeting date is September 23, 2025 at 7pm, unless otherwise approved.
CONSERVATION COMMITTEE CHARTER
OBJECTIVES
1. Conserve environmental (water, air, lack of noise) and aesthetic amenities of Portola Valley as outlined by the General Plan, the Open Space Plan and the Conservation Element.
2. Propose programs and projects to enhance aesthetic and environmental qualities of Portola Valley
3. Encourage acquisition and enlargement of Open Space Preserve lands.
4. Coordinate with and assist other Town agencies on matters involving conservation, recreation, land use, development and environmental problems.
DUTIES AND FUNCTIONS
1. Propose improvements and programs to enhance physical environment.
2. Review proposals which affect physical environment.
3. Advocate for environmental issues and provide information to Town residents.
4. Prepare standards and guidelines for use of public and Town in environmental matters.
5. Maintain broad acquaintanceship with area-wide conservation practices and programs.
6. Act as advisor and liaison to Town on matters regarding:
a. Open space.
b. Ecological questions.
c. Proposed developments.
RESPONSIBLE TO
The Town Council
COORDINATION
Architectural and Site Control Commission
Town Geologist
Parks and Recreation Committee
Planning Commission
Trails Committee
Item #6c - Attachment 2
CONSERVATION COMMITTEE- Continued
COMMUNICATIONS
1. Report to Council with recommendations for direct action.
2. Findings and recommendations to Planning Commission and other Town agencies for their information and consideration.
3. Suggestions and requests received from Town Council and other Town agencies.
MEMBERSHIP
Nine Members appointed by the Mayor with Council concurrence for one-year terms.
Rotating chair, selected by Committee.
Members may be appointed to act as liaison with other agencies.
Members to be appointed to study, recommend action
and follow through on specific projects.
MEETINGS
Meets 4
th 1st Tuesday of each month at 7:00 p.m5:30 p.m..
Charter Adopted by Town Council on 02/10/21
______________________________________________________________________________________ TO: Mayor and Members of the Town Council
FROM: Tony McFarlane, Finance Director
DATE: September 24, 2025
RE: Consider Acceptance of the FY 2021-22 Annual Comprehensive Financial Report
RECOMMENDATION:
By motion, receive, accept, and file the Annual Comprehensive Financial Report (ACFR) for Fiscal Year 2021-22 and related reports and direct staff to prepare and post the Town’s ACFR using the financial statements contained in the ACFR and in accordance with State law.
BACKGROUND
The Town’s independent auditor Maze & Associates has confirmed that the ACFR for the fiscal year ended June 30, 2022, attachment 1, is free from material misstatements and fairly represents the Town’s financial position. The auditor further provided clarification on several points.
• Change in Net Position: Town’s Net Position increased by $3.9M. • Change in Revenue: Total revenues increased by $1.4M to $8.65M. • Change in Expenditure: Total expenses decreased by $1.99M to $4.79M. • Change in Fund Balance: Fund Balance for the General Fund decreased by ($67K) to $5.47M.
• Internal Controls: Maze & Associates found no material deficiencies, however, did identify three significant deficiencies related to segregation of duties, journal entry review and approval, and timely bank reconciliations in their memorandum on internal controls.
• Reportable Errors: Maze & Associates found no reportable errors. • Single Audit Exemption: The Town is exempt from the federal government’s “Single Audit” requirement of federal award expenditures because less than $750K in federal awards was expended in 2021-22.
• Timeliness of Audit Completion: The Town is still late in completing its audit for Fiscal Years 2022-23 and 2023-24. These audits are in process.
TOWN OF PORTOLA VALLEY
STAFF REPORT
Item #7a
ACFR September 24, 2025
Finance Committee
The Finance Committee reviewed the financial statements and other reports provided by Maze and Associates at its August 26, 2025, meeting and recommended that the Town Council accept the Fiscal Year 2021-22 audited financial statements and other required reports.
Audit Schedule
As stated above, the Town is still three fiscal years behind in completing audits. Staff and Maze & Associates are attempting to complete these three audits by September 2026. The audit for FY 2024-25 is scheduled to be completed by September 2026.
Here is the audit schedule for the past three fiscal years and the current fiscal year.
Next Steps
If the Council accepts the Annual Comprehensive Financial Report (ACFR) for Fiscal Year 2021-22 and related reports, staff will prepare and post the Town’s ACFR using the financial statements contained in the ACFR and in accordance with State law.
ATTACHMENTS
1. 2021-22 Annual Comprehensive Financial Report
2. 2021-22 Memorandum on Internal Control
3. 2021-22 Required Communication
Nov-25 Staff provides completed trial balance and schedules prepared by client to Maze Dec-25 Maze provides a draft of the financial statements Jan-26 Finance Committee and Town Council review and accept audited financial statements Apr-26 Staff provides completed trial balance and schedules prepared by client to Maze May-25 Maze provides a draft of the financial statements Jun-26 Finance Committee and Town Council review and accept audited financial statements Jul-26 Staff provides completed trial balance and schedules prepared by client to Maze Aug-25 Maze provides a draft of the financial statements Sep-26 Finance Committee and Town Council review and accept audited financial statements Sep-26 Staff provides pro-forma financial statements
Audit Schedule
Fiscal Year 2022-23
Fiscal Year 2023-24
Fiscal Year 2024-25
Fiscal Year 2025-26
TOWN OF PORTOLA VALLEY
BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED
JUNE 30, 2022
.
Item #7a - Attachment 1
This Page Left Intentionally Blank
TOWN OF PORTOLA VALLEY
Basic Financial Statements
For the Year Ended June 30, 2022
Table of Contents
Page
Independent Auditor’s Report on Basic Financial Statements ....................................................................... 1 Management’s Discussion and Analysis .......................................................................................................... 5 Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Position ................................................................................................................ 18 Statement of Activities .................................................................................................................... 19 Fund Financial Statements:
Governmental Funds:
Balance Sheet ............................................................................................................................... 22 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position . 24 Statement of Revenues, Expenditures, and Changes in Fund Balance ....................................... 26 Reconciliation of the Statement of Revenues, Expenditures, and Changes in the Fund Balance of Governmental Funds to the Statement of Activities .......................... 28 Fiduciary Funds:
Statement of Net Position ............................................................................................................ 30 Statement of Changes in Net Position ........................................................................................ 31 Notes to Basic Financial Statements ...................................................................................................... 33 Required Supplementary Information:
Pension Plan:
Schedule of the Proportionate Share of Net Pension Liability ....................................................... 58 Schedule of Contributions ............................................................................................................... 59 OPEB Plan:
Schedule of Changes in the Net OPEB Liabilities (Assets) and Related Ratios ............................ 60
TOWN OF PORTOLA VALLEY
Basic Financial Statements
For the Year Ended June 30, 2022
Table of Contents
Page
Budgetary Comparison Schedules:
Schedule of Revenues Expenditures and Changes in Fund Balance – Budget and Actual:
General Fund ......................................................................................................................... 61 Open Space Restricted Special Revenue Fund ...................................................................... 62 Measure A Special Revenue Fund ........................................................................................ 63 Notes to Required Supplementary Information ............................................................................. 64 Supplementary Information:
Non-major Governmental Funds:
Combining Balance Sheet ................................................................................................. 70 Combining Statement of Revenues, Expenditures and Changes In Fund Balances ........................................................................................ 72 Schedule of Revenues, Expenditures and Changes
In Fund Balances-Budget and Actual ......................................................... 74 Custodial Funds:
Combining Statement of Net Positions ............................................................................. 80 Combining Statement of Changes in Net Positions .......................................................... 82 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 .............................................................................................................. 85
INDEPENDENT AUDITOR’S REPORT
To the Honorable Members of the Town Council
Town of Portola Valley, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Town of Portola Valley, California (Town) as of and for the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the Town’s basic financial statements as listed in the Table of Contents.
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining funds information of the Town as of June 30, 2022, and the respective changes in financial position and, where applicable, cash flows thereof and the respective budgetary comparisons listed in the Table of Contents as part of the basic financial statements for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Town and to meet our other ethical responsibilities, in accordance with the relevant ethical requirement relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
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; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Town’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our 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 generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists.
The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if, individually or in the aggregate, they could reasonably be expected to influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Town’s internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Town’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that Management’s Discussion and Analysis and other Required Supplementary Information as listed in the Table of Contents be presented to supplement the basic financial statements. Such information is the responsibility of management and although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Town’s basic financial statements. The accompanying Supplementary Information, as listed in the Table of Contents, is presented for purposes of additional analysis 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 financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the Supplementary Information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated August 11, 2025 on our consideration of the Town’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters.
The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Town’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Town’s internal control over financial reporting and compliance.
Pleasant Hill, California
August 11, 2025
This Page Left Intentionally Blank
MANAGEMENT’S DISCUSSION AND ANALYSIS
Fiscal Year Ended June 30, 2022
This section of the Town of Portola Valley’s annual Financial Report provides a narrative overview of the Town’s financial activities for the fiscal year ended June 30, 2022. We encourage readers to consider the information presented here in conjunction with the accompanying financial statements.
FINANCIAL HIGHLIGHTS:
• The Town’s Net Position, an indicator of its overall financial state, increased by $3.9 million to $51.0 million.
• Total revenues increased by $1.4 million to $8.65 million and total expenses decreased by $1.99 million to $4.79 million.
• General Fund revenues increased by $824 thousand to $6.69 million, and expenditures increased by $147 thousand to $6.18 million. • The General Fund unrestricted fund balance decreased by $67 thousand to $5.47 million.
• The beginning fund balance for the General Fund was restated by $324 thousand to $5.47 million.
Government-Wide Financial Statement Highlights:
Net Position - The assets and deferred outflows of resources of the Town exceeded its liabilities and deferred inflows of resources at fiscal year end June 30, 2022, by $51.01 million, up 8.2% from the prior year. Of this amount, $7.01 million was reported as “unrestricted net position” and may be used to meet ongoing obligations.
Changes in Net Position – The Town’s total net position increased by approximately $3.86 million at fiscal year end June 30, 2022. Net position of governmental activities increased by 8.2% from the prior year, which is due in large part to an increase in assets of $581 thousand and a decrease in liabilities of $878 thousand.
The total liabilities and deferred inflows or resources decreased 59.10% to $1.5 million, primarily due to the combined decreases in accounts payable of $747 thousand, current customer deposits of $48 thousand, and the combined decreases in Pension and OPEB obligations of $1.37 million.
OVERVIEW OF THE FINANCIAL STATEMENTS:
This discussion and analysis serve as an introduction to the Town’s basic financial statements that are comprised of three components:
1. Government-Wide Financial Statements - Provides both short-term and long-term information about the Town’s overall financial status.
2. Fund Financial Statements - Focuses on individual parts of the Town’s financial information – reporting these operations in more detail than the government-wide financial statements.
Town of Portola Valley - Financial Statements for FYE 6/30/22 Management’s Discussion and Analysis
• The governmental funds statements and the agency funds statements tell how basic services such as operations, administration, and restricted funds were financed in the short-term as well as what remains for future spending.
3. Notes to Basic Financial Statements – Provides explanation of the information contained in the basic financial statements.
The basic financial statements also include notes that explain some of the information in the statements and provide more detailed data analysis. Figure A-1 shows how the various parts of this annual report are arranged and relate to one another.
Figure A-1
Organization of the Town of Portola Valley’s Financial Report Government-Wide Financial Statements:
The government-wide financial statements present the financial picture of the Town and provide readers with a broad view of the Town’s finances. The current year’s revenues and expenses are considered, regardless of when cash is received or paid.
The first of the government-wide statements is the Statement of Net Position. The Statement of Net Position reports the difference between the Town’s total assets and total liabilities and includes all the Town’s capital assets and all its long-term debt.
Management Discussion and Analysis
Basic Financial Statements
Notes to the
Financial
Statements
Required
Supplementary
Information
Fund Financial
Statements
Government-wide
Statements
Town of Portola Valley - Financial Statements for FYE 6/30/22 Management’s Discussion and Analysis
Although the Statement of Net Position reports a total net position of $51.01 million, the Town has restrictions over the use of these funds. The investment in land, buildings, and equipment (capital assets, net of related debt) is necessary for the successful operation of the Town. Governmental laws segregate funds and place restrictions on spending. This should be considered when reviewing the report.
The second of the government-wide financial statements is the Statement of Activities.
This statement shows the result of operations that caused net position to change from the prior year to the amount reported on the Statement of Net Position as of June 30, 2022.
This change in net position is important because it tells the financial statement user whether the financial position has improved or diminished for the Town. The causes of this change may be the result of many factors. To assess the Town’s overall health, consideration should be given to additional non-financial factors such as building and land improvements, governmental mandates, and staffing levels.
The Statement of Activities classifies expenses by functional area. The report also shows corresponding charges for services and restricted grants for each function that help support the expenses. The resulting Net Revenue/(Expenses) and Changes in Net Position for OPEB, Pension, Fund Balance, Capital, and other assets shows the remaining expenses not supported by charges for services and restricted grants. General revenues are then applied to the remaining expenses resulting in a total change in net position.
Fund Financial Statements:
The fund financial statements provide detailed information about the Town’s major funds, defined as funds having significant activities and balances in the current year. Non-major funds are combined in a single column, referenced in the Supplemental section of this report.
Funds are accounting devices used to keep track of specific sources of funding and spending on specific programs. These are not reflective of the Town as a whole. It is important to note that:
• Some funds are required to be established by State law. • The Town establishes other funds to help it control and manage money for specific purposes or to show that it is meeting legal responsibilities for using certain taxes, grants, and other monies.
The fund financial statements include statements for governmental funds only. These are considered major funds and include:
• The General Fund – This fund accounts for the sources and uses for most of the Town’s basic services.
• Open Space Restricted Fund – This fund accounts for revenue received from a special voter-approved 2% utility tax. The use of these funds is for the acquisition and preservation of open spaces within the Town.
• Inclusionary-in-Lieu Fund – This fund accounts for fees collected from developers.
The use of these funds is for affordable housing.
Town of Portola Valley - Financial Statements for FYE 6/30/22 Management’s Discussion and Analysis
• Measure A Fund – This fund accounts for revenue received from a special voterapproved sales tax measure. The use of these funds is for the improvement of local transportation and road maintenance services.
The governmental funds statements provide a detailed short-term view that helps determine whether there are more or fewer financial resources that can be spent in the future to finance the Town’s programs. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. Reconciliations are provided for both the governmental funds Balance Sheet and Statement of Revenues, Expenditures, and Changes in fund balances to facilitate this comparison.
Fund Financial Statement Highlights:
Governmental Funds – As of the close of fiscal year 2021–22, the Town’s governmental funds reported a combined ending fund balance of $19.35 million. This is a $1.46 million increase from the prior year, which is primarily due to the reduction in OPEB and Pension liabilities.
With the implementation of GASB-54 in 2011, the usefulness of fund balance information has been enhanced by providing clearer fund balance classifications that can be more consistently applied and by clarifying the existing governmental fund type definitions. In the case of the Town’s statements, fund balances within the General Fund that were formerly classified as “designated” by the Council are now reclassified as “assigned” fund balances. In the case of the Town’s loan receivable, these have now been reclassified as “non-spendable” fund balance.
The total combined balance for governmental funds as of June 30, 2022, $19.35 million, is classified into four categories of fund balance (nonspendable, restricted, assigned, and unassigned) to provide the reader of these financial statements with a better understanding of the City’s available resources as well as its plans to ensure fiscal stability in the near term. A detailed explanation of these categories can be found in Note 5 of the financial statements. Of the total, $144 thousand is categorized as “non-spendable”, $14.28 million is “restricted”, $3.48 million is “assigned” and the remaining $1.45 million is “unrestricted”.
The Town’s largest and most active government fund is the General Fund which decreased in fiscal year 2021–22 by $391 thousand compared to the prior year. General Fund revenues, transfers-in, and extraordinary gains totaled $6.69 million, and expenditures/transfers out totaled $7.08 million. This increase is due to transfers to the capital project fund of $897 thousand and the overall increase in costs to carry out the maintenance and operations of the Town. General Fund revenue and expenditure for the reporting period will be discussed in more detail later in the MD&A.
The beginning fund balance for the General Fund was restated by $324 thousand due to accounting entry errors from the prior year that resulted in overstating current liabilities and General Government expenses.
Town of Portola Valley - Financial Statements for FYE 6/30/22 Management’s Discussion and Analysis
Notes to Basic Financial Statements:
The notes provide additional information that is essential for a full understanding of the data provided in the government-wide and fund financial statements.
Required Supplementary Information:
In addition to the basic financial statements, this report also presents certain Required Supplementary Information including the Town’s budgetary comparison schedules for the General, Open Space Restricted, Inclusionary-in-Lieu and Road Impact Fee funds.
Other Supplementary Information:
Supplementary schedules concerning balance sheets and changes in fund balances for all other funds are presented immediately following the Required Supplementary Information. Financial activity related to the Town’s agency funds (maintenance districts) is also presented separately in this section.
GOVERNMENT-WIDE FINANCIAL ANALYSIS:
Statement of Net Position:
The Town’s net position as of June 30, 2022, increased 8.94% from $46.8 million to $51.0 million and has increased significantly in comparison to the prior year. The following are major components of the Town’s net position:
2021-22 2020-21 Variance Percent
Other Assets $ 19,902,656 20,791,434 $ 888,778 $ 4.47%
Capital Assets, net 29,726,034 30,078,648 (352,614) -1.17% Total Assets 50,517,468 49,981,304 536,164 1.07%
Deferred Outflows of Resources 1,998,493 521,285 1,477,208 283.38% Current Liabilities 1,211,985 2,008,154 (796,169) -39.65% Noncurrent Liabilities 154,582 1,481,241 (1,326,659) -89.56% Total Liabilities 1,366,567 3,489,395 (2,122,828) -60.84% Deferred Inflow of Resources 136,269 184,294 (48,025) -26.06% Net Investments in Capital Assets 29,726,034 30,078,648 (352,614) -1.17% Nonspendable 144,134 12,528 131,606 1050.49%
Restricted 14,280,879 12,836,376 1,444,503 11.25%
Unrestricted 6,862,078 3,901,348 2,960,730 75.89%
Total Net Position $ 46,828,900 51,013,125 $ 4,184,225 8.94% Portola Valley Town's Net Position
Governmental Activities
Town of Portola Valley - Financial Statements for FYE 6/30/22 Management’s Discussion and Analysis
The Town’s net position of $51.0 million consists of $29.7 million in net investment in capital assets, $14.3 million in restricted net assets, and $7.0 million in unrestricted assets. Restricted net assets are established by State law, the municipal code, and contractual obligations to be utilized for public works, public safety, and open space. Unrestricted assets are not restricted by law; however, $3.48 million of these funds remain assigned by the Town for special programs.
The decrease in Long-Term Liabilities is primarily due to adjustments totaling $1.54 million for Net Pension (Note 6) and OPEB liabilities (Note 7). As a result of these adjustments, these liabilities are now classified as Net Assets. The OPEB liability should continue to decline as the Town continues to fund the CalPERS OPEB trust.
The Town uses capital assets to provide services to the Town’s populace; consequently, these assets are not available for future spending.
Statement of Activities:
Total revenues increased by $1.43 million, or 19.84%, from the prior year. Total expenses decreased by $1.99 million, or -29.43%, which included adjustments for capital depreciation of $1.04 million and adjustments to OPEB and pension liabilities totaling $3.07 million. Taken together these adjustments resulted in a significant increase in the Town’s Net Position of $3.86 million, or 8.24%.
Town of Portola Valley - Financial Statements for FYE 6/30/22 Management’s Discussion and Analysis
2021-22 2020-21 Variance Percent
Change in OPEB Liability (471,373) (965,433) 494,060 -51.17% Change in Pension Liability (1,075,468) 193,434 (1,268,902) -655.99% Change in Fund Balance 1,459,817 657,879 801,938 121.90% Change in Capital Assets (352,614) (987,668) 635,054 64.30% Change in Other Assets 888,778 833,536 55,242 6.63%
Net Position – Beginning, restated 47,153,089 46,398,537 754,552 1.63% Net Position - Ending 51,013,125 46,828,900 4,184,225 8.94% 2021-22 2020-21 Variance Percent
Revenues:
Program Revenues:
Charges for Services $ 1,209,452 $ 1,075,416 $ 134,036 12.46% Operating Grants and Contributions 908,438 693,402 215,036 31.01% Capital Grants and Contributions 5,300 3,552 1,748 49.21% General Revenues:
Property Taxes 3,803,444 3,027,545 775,899 25.63%
Agency Revenues 1,244,162 916,929 327,233 35.69%
Franchise Fees 414,689 215,894 198,795 92.08%
Utility Users Tax 1,128,474 1,110,440 18,034 1.62%
Investment Earnings (91,393) 153,992 (245,385) -159.35% Miscellaneous 26,715 20,061 6,654 33.17%
Total Revenues 8,649,281 7,217,231 1,432,050 19.84%
Expenses:
General Government 660,297 3,131,169 (2,470,872) -78.91% Public Safety 1,708,389 1,504,622 203,767 13.54%
Public Works 1,684,981 1,498,825 186,156 12.42%
Parks and Recreation 151,355 122,790 28,565 23.26%
Town Center Facilities 584,223 529,462 54,761 10.34%
Total Expenses 4,789,245 6,786,868 (1,997,623) -29.43%
Changes in Net Position 3,860,036 430,363 3,429,673 796.93% Net Position - Beginning of the Year 46,828,900 46,398,537 430,363 0.93% Prior Period Adjustment 324,189
Net Position - Beginning of the Year, restated 47,153,089 Net Position - End of the Year 51,013,125 46,828,900 3,860,036 8.24% Portola Valley Changes in Net Position
Governmental Activities
Town of Portola Valley - Financial Statements for FYE 6/30/22 Management’s Discussion and Analysis
Observations for 2022:
The most significant variances in revenue occurred in Grants and Contributions, Agency Revenues, Charges for Services, Franchise Fees, and Investment Earnings. • Grants and Contributions increased by 31.01% due to increased contributions to the Open Space, Public Safety COPS funds of $161 thousand, and various grants for special projects totaling $60 thousand.
• Agency Revenues increased by 35.69% due to increased activity in allocation of Measure W Half-Cent Sales Tax proceeds of $168 thousand for road improvements, and Measure M allocations of $217 thousand.
• Charges for Services increased by 12.46% primarily due to an increase in services, including Town Planning Fees, Building Permits, Plan Check Fees, Inspection Fees, and Class Fees as COVID-19 restrictions were lifted.
• Franchise Fees increased by 92.08% as due to timing differences in recognizing revenue from California Water Service Company and Comcast from prior years.
Town of Portola Valley - Financial Statements for FYE 6/30/22 Management’s Discussion and Analysis
• Investment earnings decreased by -159.35% in Schwab securities and the Local Agency Investment Fund (LAIF) due to interest rate reductions and an overall decrease in market value of -$152,382.
The most significant variances in expenditures occurred in General Government, Parks & Recreation, Public Safety, and Public Works.
• General Government decreased by (78.91%) due to reductions in Pension and OPEB liabilities.
• Parks and Recreation increased 23.26% due to the lifting of Covid-19 restrictions, which resulted in increased attendance in classes, payments for Class Instructors and Parks & Field Maintenance.
• Public Safety increased by 13.54% due to an increase in the Sherrif’s contract of $113 thousand and an increase expenditure for fire mitigation services of $82 thousand provided by the Woodside Fire Protection District (WFPD). • Public Works, including Capital Improvement Projects (CIP) increased by 12.42% due to an increase in CIP project costs of $662,459.
FUND FINANCIAL STATEMENT ANALYSIS
As of June 30, 2022, the Town’s governmental funds (General Fund, Open Space Restricted Fund, Inclusionary-in-Lieu Fund, Measure A Fund, and Other Governmental Funds) reported a combined fund balance of $19.35 million, which is an increase of $1.14 million over the prior year. Revenues for the year totaled $8.6 million, while expenditures including transfers out were $7.5 million.
The following assigned fund balances, totaling $3.5 million, can be used for their specific purposes within the General Fund; however, these funds can be reassigned at the Council’s discretion. These assignments are consistent with prior years:
• Assigned for unfunded pension reserve $712,486
• Assigned for OPEB 834,871
• Assigned for emergency capital reserve 1,400,000
• Assigned for equipment replacement 100,000
• Assigned for legal contingency 100,000
The General Fund had an unassigned fund balance of $1.4 million at fiscal year-end. The remaining $13.8 million in restricted funds can only be used for projects within the intended purpose of the funds.
Additional detail on specific fund balances can be found in the notes to the financial statements.
Governmental Fund Balances 2021-22 2020-21 Variance Percent General Fund 5,073,440 5,465,067 (391,627) -7.17%
Open Space 7,571,622 7,277,792 293,830 4.04%
Inclusionary In-lieu 3,735,375 3,762,726 (27,351) -0.73% Measure A 742,480 703,451 39,029 5.55%
Other Governmental Funds 2,231,402 1,009,655 1,221,747 121.01% Total 19,354,319 18,218,691 1,135,628 6.23%
Town of Portola Valley - Financial Statements for FYE 6/30/22 Management’s Discussion and Analysis
Fund Budgetary Highlights:
General Fund revenues exceeded budget by $502 thousand, and the prior year by $824 thousand, or 14.05%. COVID-19 restrictions were being relaxed throughout the fiscal year.
Increases in revenue include property tax of $537 thousand, sales tax of $20 thousand, charges for services of $170 thousand and a decrease in franchise fees of ($13 thousand) in comparison to the prior fiscal year.
General Fund expenditures exceeded the budget by $285 thousand. The increase is primarily due to an increase in capital projects related to deferred road resurfacing projects, increases in public safety costs related to the San Mateo County Sheriff’s contract and increased vegetation management undertaken because of the regional impact of the CZU fire.
Open Space revenues missed budget by ($188 thousand) because of market value depreciation in investments of ($197 thousand). Measure A Fund revenues were $339 thousand compared to $300 thousand in expenses with the ending fund balance remaining at $703 thousand. Gas Tax Fund revenues were $214 thousand against expenditures of $247 thousand, decreasing the ending fund balance to $216 thousand.
CAPITAL ASSET AND DEBT ADMINISTRATION
Capital Assets:
As of June 30, 2022, the Town had invested $29.7 million (net of depreciation) in a broad range of capital assets including buildings, land, and technology upgrades. The Town’s gross capital assets decreased by ($353 thousand), which was entirely due to depreciation expense for the year. Depreciation expense is allocated to the fund and category in which the capital asset has been recorded. Most of the decrease can be credited to construction in progress, buildings, and improvements.
Additional information on the Town’s capital assets can be found in Note 3.
2021-22 2020-21 Variance Percent
Land 6,690,959 $ 6,690,959 $ - $ 0.00%
Land Improvements 1,690,386 1,757,163 (66,777) -3.80%
Construction in Progress 9,851 16,406 (6,555) -39.95%
Buildings and Improvements 14,570,427 14,895,013 (324,586) -2.18% Equipment 131,135 162,216 (31,081) -19.16%
Infrastructure 6,633,276 6,556,891 76,385 1.16%
$ 30,078,648 29,726,034 $ (352,614) -1.17%
Governmental Activities
Town of Portola Valley
(Net of Accumulated Depreciation)
Town of Portola Valley - Financial Statements for FYE 6/30/22 Management’s Discussion and Analysis
Long-Term Assets
The Town’s long-term assets consist of three components: Loans receivable of $144 thousand, Net Pension assets of $45 thousand and Net OPEB assets of $179 thousand.
Long-Term Debt:
The Town’s long-term liability includes accrued compensated absences (unpaid vacation leave) balance of $155 thousand. No new debt was incurred during the fiscal year.
ECONOMIC FACTORS AND NEXT YEAR’S BUDGET:
The Town’s financial outlook remains sound. Lifting of COVID-19 restrictions has unleashed latent demand for renovations and remodels, and recreational activities.
Property values remain high and, at 56 percent of total General Fund revenue, remain a reliable resource to support City operations. Licenses and permits and other charges for services have seen a rebound. Reserve levels are consistent with policy. The Town can look toward restoration of services in future periods as supporting resources return.
Staff will continue to monitor the long-term budget situation, both locally and at the State level, to keep the Town Council informed of critical economic events that may have an impact on the sustainability of the Town’s spending plan. Further, staff will continue to be proactive in developing plans to promote economic development in the Town, aggressively pursue grant funding for significant infrastructure improvements, and continually assess the Town’s operations and service delivery models to achieve efficiencies where possible.
While in an enviable financial position considering the ongoing economic uncertainty, the Town must continue to focus its efforts on prioritizing fiscal initiatives such as adequate funding of infrastructure, careful comprehensive planning, and optimization of business and residential development opportunities. Further, as new long-term needs are identified, the appropriate resources to meet those needs must also be identified. And finally, the Town must maintain financial flexibility to ensure it is able to continue to quickly respond to changes in the economy and major revenue sources as evidenced by the recent uncertain and unprecedented environment.
The factors that most significantly impact the Town and its budget are driven by property values, building activity, and labor costs. The local real estate market and housing demand in the region remained steady. These two factors directly impact property taxes, which are the Town’s largest revenue source.
Town of Portola Valley - Financial Statements for FYE 6/30/22 Management’s Discussion and Analysis
The Town has evaluated the impact of GASB 87, issued during June 2017. The pronouncement seeks to increase the usefulness of governments’ financial statements by requiring the recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provision in the contract. It establishes a single model for lease accounting based on the foundational principle that leases are financing of the right to use an underlying asset. Under this pronouncement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources, thereby enhancing the relevance and consistency of information about governments’ leasing activities. This pronouncement is effective for fiscal years beginning after December 15, 2019. The Town’s lease agreements are immaterial to the requirements of GASB 87.
CONTACTING THE TOWN’S FINANCIAL MANAGEMENT:
This financial report is designed to provide our citizens, taxpayers, customers, investors, and creditors with a general overview of the Town’s finances and to show the Town’s accountability for the money it receives. If you have questions about this report or would like additional financial information, please contact the Finance Director at the Town of Portola Valley, 765 Portola Road, Portola Valley, California 94028.
TOWN OF PORTOLA VALLEY
STATEMENT OF NET POSITION
AND STATEMENT OF ACTIVITIES
The purpose of the Statement of Net Position and the Statement of Activities is to summarize the Town’s entire financial activities and financial position. They are prepared on the same basis as is used by most businesses, which means they include all the Town’s assets, liabilities and deferred inflows/outflows, as well as all its revenues and expenses. This is known as the full accrual basis—the effect of all the Town’s transactions is taken into account, regardless of whether or when cash changes hands, but all material internal transactions between Town funds have been eliminated.
The Statement of Net Position reports the difference between the Town’s total assets and deferred outflows of resources, if any; and the Town’s total liabilities and deferred inflows of resources, if any, including all the Town’s capital assets and all its long-term debt.
The Statement of Net Position summarizes the financial position of all of the Town’s Governmental Activities in a single column.
The Town’s Governmental Activities include the activities of its General Fund along with all its Special Revenue Funds and Capital Projects Funds.
The Statement of Activities reports increases and decreases in the Town’s net position. It is also prepared on the full accrual basis, which means it includes all the Town’s revenues and all its expenses, regardless of when cash changes hands. This differs from the “modified accrual” basis used in the Fund financial statements, which reflect only current assets, current liabilities, available revenues and measurable expenditures.
The Statement of Activities presents the Town’s expenses first, listed by program. Program revenues— that is, revenues which are generated directly by these programs—are then deducted from program expenses to arrive at the net expense of each governmental program. The Town’s general revenues are then listed in the Governmental Activities column and the Change in Net Position is computed and reconciled with the Statement of Net Position.
TOWN OF PORTOLA VALLEY
STATEMENT OF NET POSITION
JUNE 30, 2022
Governmental
Activities
ASSETS
Cash and investments (Note 2) $19,034,030
Restricted cash (Note 2) 893,510
Accounts and interest receivable 494,630
Loans receivable (Note 5) 144,134
Net OPEB assets (Note 7) 179,367
Net Pension assets (Note 6) 45,763
Capital assets, net (Note 3)
Nondepreciable 6,700,810
Depreciable, net of accumulated depreciation 23,025,224 Total Assets 50,517,468
DEFERRED OUTFLOWS OF RESOURCES
Related to pensions (Note 6) 1,998,493
LIABILITIES
Current liabilities:
Accounts payable 320,225
Refundable customer deposits 891,760
Non-current liabilities:
Accrued compensated absences (Note 1G) 154,582
Total Liabilities 1,366,567
DEFERRED INFLOWS OF RESOURCES
Related to pensions (Note 6) 136,269
NET POSITION (Note 5)
Net investment in capital assets 29,726,034
Restricted for:
Special Revenue Projects 13,450,691
Capital Projects 830,188
Unrestricted 7,006,212
Total Net Position $51,013,125
See accompanying notes to financial statements
TOWN OF PORTOLA VALLEY
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2022
Program Revenues
Charges Operating Capital Net
Operating for Grants and Grants and (Expense)
Functions/Programs Expenses Services Contributions Contributions Revenue Governmental Activities:
General government $660,297 $1,112,013 $300 $452,016
Parks and recreation 151,355 97,439 (53,916)
Town center facilities 584,223 (584,223)
Public safety 1,708,389 $179,061 (1,529,328)
Public works 1,684,981 729,377 5,000 (950,604)
Total governmental activities $4,789,245 $1,209,452 $908,438 $5,300 (2,666,055) General Revenues:
Property tax revenues……………………………………………………………………………………………… 3,803,444 Other governmental agencies revenues……………………………………………………………………………… 1,244,162 Franchise fees……………………………………………………………………………………………………… 414,689 Utility user tax……………………………………………………………………………………………………… 1,128,474 Investment earnings………………………………………………………………………………………………… (91,393) Miscellaneous revenue……………………………………………………………………………………………… 26,715 Total general revenues 6,526,091
Change in net position 3,860,036
Net Position, beginning of year, as restated (Note 5D) 47,153,089 Net Position, end of year $51,013,125
See accompanying notes to financial statements
This Page Left Intentionally Blank
TOWN OF PORTOLA VALLEY
FUND FINANCIAL STATEMENTS
The Fund Financial Statements present only individual major funds, while non-major funds are combined in a single column. Major funds are defined generally as having significant activities or balances in the current year.
The funds described below were determined to be Major Funds by the Town in fiscal year 2022.
Individual non-major funds may be found in the Supplemental section.
GENERAL FUND
Accounts for all financial resources except those required to be accounted for in another fund.
OPEN SPACE RESTRICTED
Accounts for monies accrued from a special 2% utility tax approved by the voters in 1997, 2001, 2005, 2009, 2013 (Measure Q), 2018 (Measure T) and from private donations. Restricted for acquisition and support of open space within the Town. Private donations are generally in the form of tax-deductible checks or appreciated securities.
INCLUSIONARY-IN-LIEU
Accounts for the subdivision developer’s fee, payable by fee or land that can only be used for affordable housing.
MEASURE A
Accounts for the half-cent County sales tax revenue restricted for the improvement of local transportation, including streets and roads for the recovery of road repair costs from building permit applicants due to road wear and tear from construction vehicles.
Open Space Inclusionary
General Restricted In-Lieu
ASSETS
Cash and investments (Note 2) $4,706,046 $7,558,294 $3,735,375 Restricted cash - customer deposits (Note 2) 893,510
Accounts and interest receivable 429,855 13,328
Loans receivable 144,134
Total Assets $6,173,545 $7,571,622 $3,735,375
LIABILITIES
Accounts payable $208,345
Refundable deposits 891,760
Total Liabilities 1,100,105
FUND BALANCES (Note 5)
Nonspendable 144,134
Restricted $7,571,622 $3,735,375
Assigned 3,483,789
Unassigned 1,445,517
Total Fund Balances 5,073,440 7,571,622 3,735,375
Total Liabilities and Fund Balances $6,173,545 $7,571,622 $3,735,375
BALANCE SHEET
JUNE 30, 2022
TOWN OF PORTOLA VALLEY
GOVERNMENTAL FUNDS
See accompanying notes to financial statements
Other Total
Governmental Governmental
Measure A Funds Funds
$742,480 $2,291,835 $19,034,030
893,510
51,447 494,630
144,134
$742,480 $2,343,282 $20,566,304
$111,880 $320,225
891,760
111,880 1,211,985
144,134
$742,480 2,231,402 14,280,879
3,483,789
1,445,517
742,480 2,231,402 19,354,319
$742,480 $2,343,282 $20,566,304
TOWN OF PORTOLA VALLEY
RECONCILIATION OF THE
GOVERNMENTAL FUNDS BALANCE SHEET
TO THE
STATEMENT OF NET POSITION
JUNE 30, 2022
Fund Balances - Total Governmental Funds $19,354,319
Amounts reported for governmental activities in the
statement of net position are different because:
Capital assets used in governmental activities
are not financial resources and therefore are
not reported in the funds:
Governmental capital assets 29,726,034
Retirement contributions and changes in net pension
liability subsequent to the measurement date are not
recognized on the Fund Balance Sheets and taken
into the Statement of Net Position:
Deferred outflows of resources - pension 1,998,493
Deferred inflows of resources - pension (136,269)
Long-term liabilities are not due
and payable in the current period
and therefore are not reported in the funds
Collective net pension assets (liabilities) 45,763
Net OPEB assets (liabilities) 179,367
Compensated absences (154,582)
Net Position of Governmental Activities $51,013,125
See accompanying notes to financial statements
This Page Left Intentionally Blank
General Open Space Inclusionary
Fund Restricted In-Lieu
REVENUES
Taxes
Property taxes $3,803,444
Sales tax 358,582
Utility users tax 781,252 $347,222
Gas tax
Business license tax and other taxes 92,734
Total taxes 5,036,012 347,222
Agency revenues 5,268
Grants
Contributions 300
Franchise fees 414,689
Licenses and permits 335,442
Service charges and fees 803,286
Parks and recreation 97,439
Investment and other revenues (1,897) (53,590) ($27,351) Total Revenues 6,690,239 293,932 (27,351)
EXPENDITURES
General government 3,653,707
Parks and recreation 89,211
Town center facilities 93,387
Public safety 1,540,640
Public works 807,841
Capital improvement program 102
Total Expenditures 6,184,786 102
OTHER FINANCING SOURCES (USES)
Transfers in (Note 4)
Transfers (out) (Note 4) (897,080)
Total other financing sources (uses) (897,080)
NET CHANGE IN FUND BALANCES (391,627) 293,830 (27,351)
FUND BALANCES, BEGINNING OF YEAR, AS RESTATED 5,465,067 7,277,792 3,762,726 FUND BALANCES, END OF YEAR $5,073,440 $7,571,622 $3,735,375 See accompanying notes to financial statements
TOWN OF PORTOLA VALLEY
GOVERNMENTAL FUNDS
STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
FOR THE YEAR ENDED JUNE 30, 2022
Other Total
Governmental Governmental
Measure A Funds Funds
$3,803,444
$343,809 $186,134 888,525
1,128,474
215,171 215,171
92,734
343,809 401,305 6,128,348
763,592 768,860
164,685 164,685
27,625 27,925
414,689
335,442
803,286
97,439
(4,842) (3,713) (91,393)
338,967 1,353,494 8,649,281
70,810 3,724,517
89,211
62,498 155,885
160,000 1,700,640
180,589 988,430
299,938 554,930 854,970
299,938 1,028,827 7,513,653
897,080 897,080
(897,080)
897,080
39,029 1,221,747 1,135,628
703,451 1,009,655 18,218,691
$742,480 $2,231,402 $19,354,319
Net Change in Fund Balances - Total Governmental Funds $1,135,628 Amounts reported for governmental activities in the
statement of net position are different because:
Capital outlay is an expenditure in the government
funds financial statement, but the cost of those
assets is allocated over their estimated useful
lives as depreciation expense in the statement
of activities.
Capital outlay and other capitalized expenditures $690,828 Depreciation expense (1,043,442) (352,614)
The amount below included in the Statement of
Activities does not provide or (require) the use
of current financial resources and therefore is
not reported as revenue or expenditures in
governmental funds (net change):
Pension expense 2,600,701
OPEB expense 471,373
Net change in compensated absences 4,948
Change in Net Position of Governmental Activities $3,860,036 See accompanying notes to financial statements
TOWN OF PORTOLA VALLEY
RECONCILIATION OF THE
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES
IN THE FUND BALANCE OF GOVERNMENTAL FUNDS TO THE
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2022
TOWN OF PORTOLA VALLEY
FIDUCIARY FUNDS
Fiduciary Funds are used to account for assets held by the Town as an agent for individuals, private organizations, and other governments. The financial activities of these funds are excluded from the Entity – wide financial statements, but are presented in separate Fiduciary Fund financial statements.
TOWN OF PORTOLA VALLEY
FIDUCIARY FUNDS
STATEMENT OF NET POSITION
JUNE 30, 2022
Custodial
Funds
ASSETS
Cash and investments (Note 2) $961,916
Accounts and interest receivable 3,062
Total Assets $964,978
LIABILITIES
Deposits and accrued liabilities $923,172
Total Liabilities $923,172
NET POSITION (Note 5)
Restricted for:
Maintenance Districts $41,806
Total Net Position $41,806
See accompanying notes to financial statements
TOWN OF PORTOLA VALLEY
FIDUCIARY FUNDS
STATEMENT OF CHANGES IN NET POSITION
JUNE 30, 2022
Custodial
Funds
ADDITIONS
Fee Collection $198,488
Total Additions 198,488
DEDUCTIONS
Distributions to districts 156,682
Total Deductions 156,682
Net increase (decrease) in fiduciary net position 41,806 Net Position, beginning of the year
Net Position, end of the year $41,806
See accompanying notes to financial statements
This Page Left Intentionally Blank
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of accounting policies of the Town:
A. Reporting Entity
The Town of Portola Valley (the Town) was incorporated on July 14, 1964 under the laws of the State of California. Portola Valley operates under a Council-Manager form of government. The Town provides a full range of municipal services to its citizens including public safety, culture, recreation, public improvements, planning and zoning, and general administrative support. These financial statements present the financial status of the Town.
B. Basis of Presentation
The Town’s Basic Financial Statements are prepared in conformity with Generally Accepted Accounting Principles (GAAP) as applied to governmental agencies. The Government Accounting Standards Board (GASB) is the acknowledged standard setting body for establishing governmental accounting and financial reporting principles.
These Statements require that the financial statements described below be presented.
Government-wide Statements: The Statement of Net Position and the Statement of Activities display information about the primary government (the Town). These statements include the financial activities of the overall Town government. Governmental activities are generally financed through taxes, intergovernmental revenues, and other nonexchange transactions.
The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the Town’s governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Program revenues include (a) charges paid by the recipients of goods or services offered by the programs, (b) grants and contributions that are restricted to meeting the operational needs of a particular program and (c) fees, grants and contributions that are restricted to financing the acquisition or construction of capital assets. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.
Fund Financial Statements: The fund financial statements provide information about the Town's funds. The emphasis of fund financial statements is on major individual governmental funds, each of which is displayed in a separate column. All remaining governmental funds are aggregated and reported as nonmajor funds.
C. Major Funds
The Town’s major governmental funds are presented separately in the fund financial statements.
All other funds, called non-major funds, are combined and reported in a single column, regardless of their fund-type.
Major funds are defined as funds that have either assets, liabilities, revenues or expenditures/expenses equal to ten percent of their fund-type total and five percent of the grand total. The General Fund is always a major fund. The Town may also select other funds it believes should be presented as major funds.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) The Town reported the following major governmental funds in the accompanying financial statements:
General Fund is the general operating fund of the Town. It is used to account for all financial resources except those required to be accounted for in another fund.
Open Space Restricted Fund is a major fund of the Town. Through the years, residents and others have raised funds to preserve some 100 acres of open space within the Town’s boundaries, Several fund-raising committees have worked at various times to achieve this goal, culminating in today’s Open Space Acquisition Fund (PVOSAF). This fund, overseen by the Town Council, is composed of monies accrued from a special 2% utility tax approved by the voters in 1997 and from private donations. Subsequent elections were re-authorizing the increase of the appropriations limits for 4 additional years. It can be used for the acquisition and support of open space within the Town.
Private donations are generally in the form of tax-deductible checks or appreciated securities.
Inclusionary-In-Lieu is used to account for the subdivision developer’s fee, payable by fee or land that can only be used for affordable housing.
Measure A accounts for the half-cent County sales tax revenue restricted for the improvement of local transportation, including streets and roads for the recovery of road repair costs from building permit applicants due to road wear and tear from construction vehicles.
The Town also reports the following fund types:
Custodial Funds account for assets held by the Town in a purely custodial capacity. Since custodial funds are custodial in nature, they do not involve measuring the results of operations and are not presented in the government-wide financial statements. There are five custodial funds, account for fees collected for the following maintenance districts: Cresent Road, Portola Valley Ranch, Wayside Road I, Wayside Road II and Woodside Highlands Road.
D. Basis of Accounting
The government-wide financial statements are reported using the economic resources measurement focus and the full accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place.
Governmental funds financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The Town considers all revenues reported in the governmental funds to be available if the revenues are collected within 45 to 60 days after year-end.
Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt, claims and judgments, and compensated absences, which are recognized as expenditures to the extent they have matured. Governmental capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of governmental longterm debt and acquisitions under capital leases are reported as other financing sources.
Those revenues susceptible to accrual are property tax, sales tax, utility user tax, interest revenue and franchise fees. Fines, licenses and permits are not susceptible to accrual because they are not measurable until received in cash.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Non-exchange transactions, in which the Town gives or receives value without directly receiving or giving equal value in exchange, include taxes, grants, entitlements, and donations. On the accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied or assessed. Revenue from grants, entitlements, and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.
The Town may fund programs with a combination of cost-reimbursement grants and general revenues. Thus, both restricted and unrestricted net position may be available to finance program expenditures. The Town’s policy is to first apply restricted grant resources to such programs, followed by general revenues if necessary.
Certain indirect costs are included in program expenses reported for individual functions and activities.
E. Property Taxes
County tax assessments include secured and unsecured property taxes. Unsecured taxes are taxes on personal property. Tax assessments are secured by liens on the property being taxed. The County makes annual adjustments as needed to current year revenues based on true-ups and prior year tax roll corrections to special districts related to Tax Equity Allocations.
Revenue is recognized in the period for which the tax and assessment is levied. The County of San Mateo levies, bills and collects property taxes for the Town. The County remits the entire amount levied and handles all delinquencies, retaining interest and penalties.
Secured and unsecured property taxes are levied on January 1. Secured property tax is due in two installments, on November 1 and February 1, and becomes a lien on those dates. It becomes delinquent on December 10 and April 10, respectively. Unsecured property tax is due on August 31 and becomes delinquent on September 30.
F. Implementation of Governmental Accounting Standards Board Statements The Town has implemented the requirements of the following GASB Pronouncement:
In June 2017, GASB issued GASB Statement No. 87, Leases. The objective of this Statement is to better meet the information needs of financial statement users by improving accounting and financial reporting for leases by governments. This Statement increases the usefulness of governments’ financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract. It establishes a single model for lease accounting based on the foundational principle that leases are financings of the right to use an underlying asset. Under this Statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources, thereby enhancing the relevance and consistency of information about governments’ leasing activities. The provisions of this Statement were implemented during fiscal year 2022.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) G. Compensated Absences
Compensated absences represent the vested portion of accumulated vacation and compensation time. Upon termination, 100% of vacation leave will be paid. The Town records a liability for unpaid compensated absences.
The changes of the compensated absences are as follows:
Beginning balance $159,530
Additions 551,164
Payments (556,113)
Ending balance $154,582
Accumulated sick leave benefits are not recognized as liabilities of the Town. The Town’s policy is to record sick leave as an operation expense in the period taken since such benefits do not vest nor is payment probable.
For all governmental funds, amounts that have matured are recorded as fund liabilities; the longterm portion is recorded in the Statement of Net Position.
Compensated absences are liquidated by the fund that has recorded the liability. The long-term portion of governmental activities compensated absences is liquidated primarily by the General Fund.
H. Deferred Compensation Plan
Town employees may defer a portion of their compensation under Town sponsored Deferred Compensation Plans created in accordance with Internal Revenue Code Section 457. Under these plans, participants are not taxed on the deferred portion of their compensation until distributed to them; distributions may be made only at separation, retirement, death or in an emergency as defined by the Plans.
The laws governing deferred compensation plan assets required them to be held by a Trust for the exclusive benefit of plan participants and their beneficiaries. Since the assets held under these plans are not the Town’s property and are not subject to the Town control, they have been excluded from these financial statements.
I. Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) J. Deferred Outflows/Inflows of Resources
In addition to assets, the statement of net position or balance sheet will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position or fund balance that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then.
In addition to liabilities, the statement of net position or balance sheet will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position or fund balance that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time.
K. Fair Value Measurements
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Town categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The fair value hierarchy categorizes the inputs to valuation techniques used to measure fair value into three levels based on the extent to which inputs used in measuring fair value are observable in the market.
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 inputs are inputs – other than quoted prices included within level 1 – that are observable for an asset or liability, either directly or indirectly.
Level 3 inputs are unobservable inputs for an asset or liability.
If the fair value of an asset or liability is measured using inputs from more than one level of the fair value hierarchy, the measurement is considered to be based on the lowest priority level input that is significant to the entire measurement.
L. Leases
As clarified by the Government Accounting Standards Board (GASB) Statement No. 87, a lease is defined as a contract that conveys control of the right to use another entity’s nonfinancial asset (the underlying asset) as specified in the contract for a period of time in an exchange or exchange-like transaction. Examples of nonfinancial assets include buildings, land, vehicles, and equipment. The Town recognizes lease receivables or liabilities with an initial, individual value of $300,000 or more, based on the future lease payments remaining at the start of the lease.
The Town has no leases subject to GASB#87 for the fiscal year 2022.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 2 - CASH AND INVESTMENTS
The Town maintains a cash and investment pool for all funds consistent with the Town’s investment policy and relevant governmental code.
A. Policies
The California Government Code requires California banks and savings and loan associations to secure the Town’s cash deposits by pledging securities as collateral. This Code states that collateral pledged in this manner shall have the effect of perfecting a security interest in such collateral superior to those of a general creditor. Thus, collateral for cash deposits is considered to be held in the Town’s name.
California Law requires banks and savings and loan institutions to pledge government securities with a market value of 110% of the Town’s cash on deposit or first trust deed mortgage notes with a market value of 150% of the Town’s total cash deposits, as collateral for these deposits. The Town may waive collateral requirements for cash deposits, which are fully insured up to $250,000 by the Federal Deposit Insurance Corporation. The Town, however, has not waived the collateralization requirements. Under California Law this collateral is held in a separate investment pool by another institution in the Town’s name and places the Town ahead of general creditors of the institution.
The Town follows the practice of pooling cash and investments of all funds, except for funds required to be held by fiscal agents under the provisions of bond indentures. Interest income earned on pooled cash investments is allocated on an accounting period basis to the various funds based on the period-end cash and investment balances. Interest income from cash and investments with fiscal agent is credited directly to the related fund.
The Town’s investments are carried at fair value, as required by the generally accepted accounting principles. The Town adjusts the carrying value of its investments to reflect their fair value at each fiscal year end, and it includes the effects of these adjustments in income for that fiscal year.
B. Classification
Cash and investments are classified in the financial statements as follows:
Statement of Net Position:
Cash and investments $19,034,030
Restricted cash and investments 893,510
Cash and investments of the Town 19,927,540
Cash and investments in Agency Funds 961,916
Total cash and investments $20,889,456
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 2 - CASH AND INVESTMENTS (Continued)
C. Investments Authorized by the California Government Code and the Town’s Investment Policy The Town’s Investment Policy and the California Government Code allow the Town to invest in the following, provided the credit ratings of the issuers are acceptable to the Town; and approved percentages and maturities are not exceeded.
Authorized Investment Type
Maximum
Maturity
Maximum
Percentage of
Portfolio
Maximum
Investment In
One Issuer
California Local Agency Investment Fund N/A None $75 million U.S. Treasury Obligations 5 years None None
US Government Agency Bonds N/A None None
Joint Powers Authority Pool N/A None None
County Pooled Investment Funds N/A None None
Negotiable Certificates of Deposits 5 years 30% None
Money Market and Mutual funds * Upon Demand None None
* For Funds investing over 80% of assets in either:
of rating of “A” or better
2) short to medium term Federal Agency or U.S. Government sponsored enterprise obligations. 1) short to medium term corporate bonds holding an average credit not to exceed 30% of surplus funds, The Town does not enter into any repurchase or reverse repurchase agreements.
D. Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Normally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates will be.
Information on the fair values of the Town’s cash and investments at June 30, 2022, is provided by the following table:
Investment Type
12 Months or
less Total
California Local Agency Investment Fund $11,835,884 $11,835,884 Money Market Mutual Funds 4,593,522 4,593,522
Total Investments $16,429,406 16,429,406
Cash in Bank 4,458,550
Cash on Hand 1,500
Total Cash 4,460,050
Total cash and investments $20,889,456
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 2 - CASH AND INVESTMENTS (Continued)
The Town is a participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. The Town reports its investment in LAIF at the fair value amount provided by LAIF.
The balance is available for withdrawal on demand, and is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis. Included in LAIF’s investment portfolio are collateralized mortgage obligation, mortgage-backed securities, other asset-backed securities, loans to certain state funds, and floating rate securities issued by federal agencies, government-sponsored enterprises, Untied States Treasury Notes and Bills, and corporations. At June 30, 2022, these investments matured in an average of 311 days.
Money market mutual funds are available for withdrawal on demand and at June 30, 2022, had an average maturity date of 30 days.
E. Credit Risk
Credit Risk is the risk that an issuer will not fulfill its obligation to the holder of the investment.
This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the minimum rating required (where applicable) the California Government Code, the City’s investment policy, and actual ratings as of June 30, 2022 for each investment type as provided by Moody’s investment type rating system (as date of the purchase):
Investment Type AAm/AAA Not Rated Total
California Local Agency Investment Fund $11,835,884 $11,835,884 Money Market Mutual Funds $4,593,522 4,593,522
Total Investments $4,593,522 $11,835,884 $16,429,406
F. Fair Value Hierarchy
The Town categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure fair value of the assets.
The California Local Agency Investment Fund is reported at amortized cost, and is not subject to the fair value reporting requirements. Fair value is defined as the quoted market value on the last trading day of the period. These prices are obtained from various pricing sources by our custodian bank.
G. Custodial Credit Risk
Custodial credit risk is the risk that in the event of a bank failure, the Town’s deposits may not be able to recover the value of its investments or collateral securities that are in possession of an outside party.
Significant investments in the securities of any individual issuers, other than U.S. Treasury securities or mutual funds would be subjected to this risk. As of June 30, 2022, no investments were subjected to custodial credit risk on the entity-wide level.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 3 - CAPITAL ASSETS
The Town defines capital assets as assets with an initial cost generally of $5,000 or more and an estimated useful life in excess of two years except for land which is always capitalized and buildings, land improvements and infrastructure which have a $25,000 capitalization threshold.
All capital assets are valued at historical cost or estimated historical cost if actual historical cost is not available. Contributed capital assets are valued at their estimated fair market value on the date contributed.
The Town is required to record all its public domain (infrastructure) capital assets. The Town has elected to prospectively record its infrastructure placed into service beginning in fiscal year 2004, including roads, curbs and gutters, streets, trails, paths and drainage systems.
All capital assets with limited useful lives are depreciated over their estimated useful lives. The purpose of depreciation is to spread the cost of capital assets equitably among all users over the life of these assets.
The amount charged to depreciation expense each year represents that year’s pro rata share of the cost of capital assets.
Depreciation is provided using the straight line method which means the cost of the asset is divided by its expected useful life in years and the result is charged to expense each year until the asset is fully depreciated. The Town has assigned the useful lives listed below to capital assets:
Asset Class Useful Lives
Infrastructure p 50 years
Buildings 50 years
Buildings and Improvements 20 - 50 years
Equipment 5 - 20 years
Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase is reflected in the capitalized value of the asset constructed, net of interest earned on the invested proceeds over the same period.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 3 - CAPITAL ASSETS (Continued)
A. Capital Assets
Capital assets activities during the fiscal year ended June 30, 2022 was as follows:
Balance Transfers & Balance
June 30, 2021 Additions Adjustment June 30, 2022
Governmental Activities
Capital assets not being depreciated:
Land $6,690,959 $6,690,959
Construction in Progress 16,406 $9,851 ($16,406) 9,851
Total capital assets not being depreciated 6,707,365 9,851 (16,406) 6,700,810 Capital assets being depreciated:
Infrastructure 11,296,277 608,794 11,905,071
Land improvements 3,070,430 16,406 3,086,836
Buildings and improvements 19,838,406 72,183 19,910,589 Equipment 528,176 528,176
Total capital assets being depreciated 34,733,289 680,977 16,406 35,430,672 Less accumulated depreciation for:
Infrastructure (4,739,386) (532,409) (5,271,795)
Land improvements (1,313,267) (83,183) (1,396,450)
Buildings and improvements (4,943,393) (396,769) (5,340,162) Equipment (365,960) (31,081) (397,041)
Total accumulated depreciation (11,362,006) (1,043,442) (12,405,448) Total depreciable assets, net 23,371,283 (362,465) 16,406 23,025,224 Capital assets, net $30,078,648 ($352,614) $29,726,034
B. Depreciation Allocation
Depreciation expense is charged to functions and programs based on their usage of the related assets. The amounts allocated to each function or program is as follows:
Governmental Activities
General Government $12,802
Parks and Recreation 62,144
Town Center Facilities 428,338
Public Safety 7,749
Public Works 532,409
Total Governmental Activities $1,043,442
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 4 – INTERFUND TRANSACTIONS
A. Interfund Transfers
With Council approval, resources may be transferred from one Town fund to another, Interfund transfers for the year of June 30, 2022, were as follows:
Transfers in Transfers Out Total
Non-Major Governmental Funds General Fund $897,080
B. Current Interfund Balances
Current interfund balances arise in the normal course of business and are expected to be repaid shortly after the end of the fiscal year. As of June 30, 2022 there were no interfund balances.
NOTE 5 – NET POSITION AND FUND BALANCES
A. Net Position
Net Position is measured on the full accrual basis and is the excess of all the Town’s assets and deferred outflows of resources over all its liabilities, and deferred inflows of resources. Net Position is divided into three captions which are determined only at the Government-wide level, and are described below:
Net Investment in Capital Assets describes the portion of Net Position which is represented by the current net book value of the Town’s capital assets, less the outstanding balance of any retention payables.
Restricted describes the portion of Net Position which is restricted as to use by the terms and conditions of agreements with outside parties, governmental regulations, laws, or other restrictions which the Town cannot unilaterally alter.
Unrestricted describes the portion of Net Position which is not restricted to use.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 5 - NET POSITION AND FUND BALANCES (Continued)
B. Fund Balances
Governmental fund balances represent the net current assets of each fund. Net current assets generally represent a fund’s cash and receivables, less its liabilities.
The Town’s fund balances are classified in accordance with Governmental Accounting Standards Board Statement Number 54 (GASB 54), Fund Balance Reporting and Governmental Fund Type Definitions, which requires the Town to classify its fund balances based on spending constraints imposed on the use of resources. For programs with multiple funding sources, the Town prioritizes and expends funds in the following order: Restricted, Committed, Assigned, and Unassigned.
Each category in the following hierarchy is ranked according to the degree of spending constraint:
Nonspendable represents balances set aside to indicate items do not represent available, spendable resources even though they are a component of assets. Assets not expected to be converted to cash, such as prepaids and notes receivable are included. However, if proceeds realized from the sale or collection of nonspendable assets are restricted, committed or assigned, then nonspendable amounts are required to be presented as a component of the applicable category.
Restricted fund balances have external restrictions imposed by creditors, grantors, contributors, laws, regulations, or enabling legislation which requires the resources to be used only for a specific purpose. Nonspendable amounts subject to restrictions are included along with spendable resources.
Committed fund balances have constraints imposed by formal action of the Town Council which may be altered only by formal action of the Town Council. Nonspendable amounts subject to council commitments are included along with spendable resources.
Assigned fund balances are amounts constrained by the Town’s intent to be used for a specific purpose, but are neither restricted nor committed. Intent is expressed by the Town Council and may be changed at the discretion of the Town Council. This category includes nonspendables, when it is the Town’s intent to use proceeds or collections for a specific purpose; and residual fund balances, if any, of Special Revenue Funds which have not been restricted or committed.
Unassigned fund balance represents residual amounts that have not been restricted, committed, or assigned. This includes the residual General Fund balance and residual fund deficits, if any, of other governmental funds.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 5 - NET POSITION AND FUND BALANCES (Continued)
Detailed classifications of the Town’s fund balances, as of June 30, 2022, are below:
Open Space Inclusionary
Restricted In-lieu Measure A Other
General Special Revenue Special Revenue Special Revenue Governmental Fund Fund Fund Fund Funds Total
Fund balances:
Nonspendables:
Loans receivable $144,134 $144,134
Total nonspendable 144,134 144,134
Restricted for:
Open space acquisition $7,571,622 7,571,622
Public safety $3,715 3,715
Gas tax 303,878 303,878
Public safety COPS 164,444 164,444
Library fund 45,631 45,631
Park in-lieu 35,086 35,086
Grants 133,482 133,482
Capital projects 661,620 661,620
Inclusionary in-lieu $3,735,375 3,735,375
Measure M 54,221 54,221
Frod Pond OS Rd Remnant 27,571 27,571
ARPA-Coronavirus Recovery 399,647 399,647
Measure A $742,480 742,480
Measure W 402,107 402,107
Total restricted 7,571,622 3,735,375 742,480 2,231,402 14,280,879 Assigned to:
Unfunded pension reserve 1,048,918 1,048,918
Equipment replacement 100,000 100,000
1,400,000 1,400,000
OPEB 834,871 834,871
Legal contingency 100,000 100,000
Total assigned 3,483,789 3,483,789
Unassigned 1,445,517 1,445,517
Total fund balances $5,073,440 $7,571,622 $3,735,375 $742,480 $2,231,402 $19,354,319 Capital replacement/repairs
C. General Fund Minimum Fund Balance Policy
Town is required to maintain a minimum of 60% of its annual budgeted operating expenditures (excluding capital improvement expenditures) within the General Fund’s unrestricted fund balance.
This amount is to be calculated annually via the adopted budget for the next fiscal year. The General Fund unrestricted fund at June 30, 2022 is as follows:
Fiscal 2021-22 Adopted Budget General Fund Operating Expenditures $7,008,648 Multiplied by 60%:
Required minimum unrestricted General Fund fund balance $4,205,189 General Fund unrestricted fund balance as of June 30, 2022 $4,929,306 D. Beginning Fund Balance and Net Position Restatement
Adjustments resulting from errors or changes are treated as adjustments to prior periods to comply with provisions of the accounting standards. The Town adjusted the beginning fund balances for the General Fund and the beginning net position for the Statement of Activities as of July 1, 2021, for $324,189 to reduce the pension-related liabilities not properly reversed in the fiscal year 2021.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 6 - PENSION PLAN
For purposes of measuring the net pension liabilities (assets)and deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Town’s California Public Employees’ Retirement System (CalPERS) plans (Plans) and additions to/deductions from the Plans’ fiduciary net position have been determined on the same basis as they are reported by CalPERS. For the purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
A. General Information about the Pension Plans
Plan Description – All qualified permanent and probationary employees are eligible to participate in the Town’s separate Miscellaneous Employee Pension Rate Plans. The Town’s Miscellaneous Rate Plan is part of the public agency cost-sharing multiple-employer defined benefit pension plan (PERF C), which is administered by the California Public Employees’ Retirement System (CalPERS). PERF C consists of a miscellaneous pool and a safety pool (also referred to as “risk pools”), which are comprised of individual employer miscellaneous and safety rate plans, respectively. Individual employers may sponsor more than one miscellaneous rate plan. The employer participates in one cost-sharing multiple-employer defined benefit pension plan regardless of the number of rate plans the employer sponsors. The Town sponsors two miscellaneous rate plans. Benefit provisions under the Plan are established by State statute and Town resolution. CalPERS issues publicly available reports that include a full description of the pension plan regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.
Benefits Provided – CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service.
The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied as specified by the Public Employees’ Retirement Law.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 6 - PENSION PLAN (Continued)
The Plans’ provisions and benefits in effect at June 30, 2022, are summarized as follows:
Classic PEPRA
Hire date Prior to January 1, 2013 On or after January 1, 2013 Benefit Formula 2% at 55 2% at 62
Benefit vesting schedule 5 years service 5 years service Benefit payments Monthly for life Monthly for life
Retirement age 50 - 67+ 52 - 67+
Monthly benefits, as a % of eligible compensation 1.426 - 2.418% 1.000 - 2.500% Required employee contribution rates 6.910% 6.750%
Required employer contribution rates 10.340% 7.590%
Miscellaneous
Beginning in fiscal year 2016, CalPERS collects employer contributions for the Plan as a percentage of payroll for the normal cost portion as noted in the rates above and as a dollar amount for contributions toward the unfunded liability (UAL). The dollar amounts are billed on a monthly basis. The City’s required contributions for the unfunded liability in the Miscellaneous Plan was $91,581.
Contributions – Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. Funding contributions for the Plan are determined annually on an actuarial basis as of June 30 by CalPERS.
The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The Town is required to contribute the difference between the actuarially determined rate and the contribution rate of employees.
For the year ended June 30, 2022, the Town’s contributions to the Plan were as follows:
Miscellaneous
Contributions - employer $267,420
B. Net Pension Liabilities (Assets)
As of June 30, 2022, the Town reported a net pension asset for its proportionate share of the net pension Liabilities (Assets) of the Plan as follows:
Proportionate Share
of Net Pension Liabilities (Assets)
Miscellaneous ($45,763)
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 6 - PENSION PLAN (Continued)
The Town’s net pension liabilities (assets) for the Plan is measured as the proportionate share of the net pension liability. The net pension liabilities (assets)of the Plan is measured as of June 30, 2021, and the total pension liability for the Plan used to calculate the net pension liabilities (assets) was determined by an actuarial valuation as of June 30, 2020 rolled forward to June 30, 2021 using standard update procedures. The Town’s proportion of the net pension liabilities (assets) was based on a projection of the Town’s long-term share of contributions to the pension plan relative to the projected contributions of all participating employers, actuarially determined. The Town’s proportionate share of the net pension liabilities (assets) for the Plan as of June 30, 2020 and 2021 was as follows:
Miscellaneous
Proportion - June 30, 2020 0.02441%
Proportion - June 30, 2021 -0.00241%
Change - Increase (Decrease) -0.02682%
C. Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions For the year ended June 30, 2022, the Town recognized pension expense of $(2,868,121). On June 30, 2022, the Town reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contributions subsequent to measurement date $267,420 Differences between actual and expected experience ($5,132) Changes of assumptions
Change in employer's proportion and differences between the employer’s contributions and the employer’s
proportionate share of contributions (171,086)
Change in proportion 1,731,073
Net differences between projected and actual earnings
on plan investments 39,949
Total $1,998,493 ($136,269)
The $267,420 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liabilities (assets) in the year ended June 30, 2023. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:
Year Ended Annual
June 30 Amortization
2023 $581,617
2024 588,175
2025 413,971
2026 11,041
Total $1,594,804
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 6 - PENSION PLAN (Continued)
Actuarial Assumptions – The total pension liability was determined by rolling forward the total pension liability determined in the June 30, 2020, actuarial accounting valuation to June 30, 2021.
The total pension liability was based on the following actuarial methods and assumptions:
Miscellaneous (1)
Valuation Date June 30, 2020
Measurement Date June 30, 2021
Actuarial Cost Method Entry-Age Normal Cost Method
Actuarial Assumptions:
Discount Rate 7.15%
Inflation 2.50%
Salary Increases (1)
Investment Rate of Return 7.15% (2)
Mortality Derived using CalPERS' membership data for all funds (3)
Post Retirement Benefit Increase Contract COLA up to 2.5% until Purchasing Power Protection Allowance Floor on Purchasing Power
applies
(3) The mortality table used was developed based on CalPERS’ specific data. The table includes 15 years of mortality improvements using the Society of Actuaries Scale 90% of scale MP 2016. For more details on this table, please refer to the December 2017 experience study report (based on CalPERS demographic data from 1997 to 2015) that can be found on the CalPERS website. (1) Depending on age, service and type of employment.
(2) Net of pension plan investment expenses, including inflation.
The underlying mortality assumptions and all other actuarial assumptions used in the June 30, 2020 valuation were based on the results of a December 2017 actuarial experience study for the period 1997 to 2015. Further details of the Experience Study can be found on the CalPERS website.
Discount Rate – The discount rate used to measure the total pension liability for the Plan was
7.15%. The projection of cash flows used to determine the discount rate for the Plan assumed that contributions from all plan members in the Public Employees Retirement Fund (PERF) will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefits payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payment to determine the total pension liability.
The long-term expected rate of return on pension plan investments was determined using a building-block method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 6 - PENSION PLAN (Continued)
In determining the long-term expected rate of return, staff took into account both short-term and long-term market return expectations as well as the expected pension fund cash flows. Using historical returns of all the funds’ asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11+ years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equal to the single equivalent rate calculated above and adjusted to account for assumed administration expenses.
The table below reflects the expected real rates of return by asset class.
Asset Class (a)
Assumed
Asset
Allocation
Real Return
Years 1 - 10(b)
Real Return
Years 11+(c)
Public Equity 50.0% 4.80% 5.98%
Fixed Income 28.0% 1.00% 2.62%
Inflation Assets 0.0% 0.77% 1.81%
Private Equity 8.0% 6.30% 7.23%
Real Assets 13.0% 3.75% 4.93%
Liquidity 1.0% 0.00% -0.92%
Total 100%
(a) In the CalPERS Annual Comprehensive Financial Report, Fixed Income is included in Global Debt Securities; Liquidity is included in Short term Investments; Inflation Assets are included in both Global Equity Securities and Gloal Debt Securities. (b) An expected inflation of 2.0% is used this period.
(c ) An expected inflation of 2.92% used for this period.
Sensitivity of the Net Pension Liabilities (assets) to Changes in the Discount Rate – The following presents the Town’s proportionate share of the net pension liabilities (assets) for the Plan, calculated using the discount rate for the Plan, as well as what the Town’s proportionate share of the net pension liabilities (assets) would be if it were calculated using a discount rate that is 1- percentage point lower or 1-percentage point higher than the current rate:
Miscellaneous
1% Decrease 6.15%
Net Pension Liabilities (Assets) $1,119,588
Current Discount Rate 7.15%
Net Pension Liabilities (Assets) ($45,763)
1% Increase 8.15%
Net Pension Liabilities (Assets) ($1,009,142)
Pension Plan Fiduciary Net Position – Detailed information about the pension plan’s fiduciary net position is available in the separately issued CalPERS financial reports.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 7 - OTHER POSTEMPLOYMENT BENEFITS (OPEB) OBLIGATIONS A. General Information about the Town’s OPEB Plan
Plan Description
The Town’s Post Employment Benefit Plan is a single-employer defined benefit OPEB plan.
Permanent employees who retire under the Town’s CalPERS retirement plan are, pursuant to their respective collective bargaining agreements, eligible to have certain portion of their medical insurance premiums paid by the Town. No assets are accumulated in a trust that meets the criteria in paragraph 4 of Governmental Accounting Standards Board Statement No. 75.
The Town contracts with CalPERS for this insured-benefit plan established under the state Public Employees’ Medical and Hospital Care Act (PEMHCA). The plan offers employees and retirees three CalPERS’ self-funded options, setup as insurance risk pools, or offers various third-party insured health plans. The plan’s medical benefits and premium rates are established by CalPERS and the insurance providers. The Town contribution is established by Town resolution. Retirees and active employees pay the difference between the premium rate and the Town’s contribution.
Premiums and Town contributions are based on the plan and coverage selected by actives and retirees. A comprehensive annual financial report of CalPERS, inclusive of their benefit plans, is available at www.calpers.ca.gov. Eligibility and the Town contributions toward month premiums are as follows:
Benefits Provided
The following is a summary of Plan benefits by employee group as of June 30, 2022:
Eligibility
Minimum age before retirement 50
Minimum required years of service: 5
Health Benefit - Employer Contribution
Monthly Premiums
BlueShield HMO medical, pharmacy $143
Kaiser medical, pharmacy coverage $143
PERSChoice medical, pharmacy coverage $143
Employees Covered by Benefit Terms
Membership in the plan consisted of the following at the measurement date of June 30, 2022:
Active employees 11
Inactive employees or beneficiaries currently
receiving benefit payments 4
Total 15
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 7 - OTHER POSTEMPLOYMENT BENEFITS (OPEB) OBLIGATIONS (Continued) B. Net OPEB Liabilities (Assets)
Actuarial Methods and Assumptions
Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the type of benefits provided at the time of each valuation and the historical pattern of sharing benefit costs between the employer and plan members to that point. The actuarial calculations of the OPEB plan reflect a long-term perspective. Consistent with this perspective, actuarial valuations, after this initial year, will use actuarial methods and assumptions that include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets. The ARC for the plan was determined as part of the actuarial valuation using the following methods and assumptions:
Actuarial Assumptions
Valuation Date June 30, 2021
Measurement Date June 30, 2022
Actuarial Cost Method Entry Age Normal
Amortization Method Level Percentage of Payroll
Actuarial Assumptions:
Discount Rate 7.59%
Payroll Growth 3.20%
Mortality Rate Pub-2010 Public Retirement Plans Mortality Tables, with mortality improvement projected for 10 years
Amortization Period 20 years
Pre-Retirement Turnover
Derived from data maintained by the U.S. Office of Personnel Management regarding the most recent experience of the employee group covered by the Federal Employees Retirement System Healthcare Trend Rates 5.8% descending to 4.1% over 10 years The discount rate was based on the long-term expected rate of return on OPEB plan investments.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 7 - OTHER POSTEMPLOYMENT BENEFITS (OPEB) OBLIGATIONS (Continued) C. Changes in Net OPEB Liabilities (Assets)
The end of the year net OPEB liabilities (assets) are determined as follows:
Total OPEB Plan Fiduciary Net OPEB
Liabilities (Assets) Net Position Liabilities (Assets)
(a) (b) (a) - (b)
Balance at June 30, 2021 $851,941 $559,935 $292,006
Changes Recognized for the Measurement Period:
Service cost 60,118 60,118
Interest on the total OPEB liabilities 41,523 41,523
Changes of benefit terms
Differences between expected and actual experience
Economic gains or losses (380,979) (380,979)
Changes of assumptions (185,030) (185,030)
Contributions from the employer 78,745 (78,745)
Contributions from the employee 8,760 (8,760)
Net investment income (80,367) 80,367
Administrative expenses (133) 133
Benefit payments (7,008) (7,008)
Net changes (471,376) (3) (471,373)
Balance at June 30, 2022 (Measurement Date) $380,565 $559,932 ($179,367) D. Sensitivity of the Net OPEB Liabilities (Assets) to Changes in the Discount Rate and Healthcare Cost Trend Rates
The following presents the Net OPEB Liabilities (Assets) of the Town, as well as what the Town's Net OPEB Liabilities (Assets) would be if it were calculated using a discount rate that is 1- percentage-point lower (6.590%) or 1-percentage-point higher (8.590%) than the current discount rate:
Net OPEB Liabilities/(Assets)
Discount Rate -1% Discount Rate Discount Rate +1%
(6.590%) (7.590%) (8.590%)
($129,273) ($179,367) ($221,365)
The following presents the Net OPEB Liabilities (Assets) of the Town, as well as what the Town's Net OPEB Liabilities (Assets) would be if it were calculated using healthcare cost trend rates that are 1-percentage-point lower or 1-percentage-point higher than the current healthcare cost trend rates of
5.8%, descending to 4.1% over 10 years:
Net OPEB Liabilities/(Assets)
Trend rate -1% Current Healthcare Cost Trend rate +1%
Trend Rates
($209,220) ($179,367) ($143,238)
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 8 – RISK MANAGEMENT
The Town participates in the following public entity risk pools; other risks are covered by commercial insurance.
A. Liability Coverage
The Town, along with 28 other Bay Area governments, is a member of the of the Pooled Liability Assurance Network Joint Powers Authority (PLAN JPA), a joint powers insurance authority consisting of 28 member cities in the San Francisco Bay Area, a public-entity risk pool. PLAN JPA provides liability insurance coverage, claims management, risk management services and legal defense to its participating members. PLAN JPA is governed by a Board of Directors, which is comprised of officials appointed by each participating member. Premiums paid to PLAN JPA are subject to a possible refund based on the results of actuarial studies and approval by PLAN JPA’s Board of Directors. In the opinion of the Town management, premiums made represent the best available estimate of the ultimate cost of the Town’s participation in PLAN JPA and, accordingly, the accompanying basic financial statements of the Town include no provisions for possible refunds or additional assessments. Actual refunds and assessments arising from retrospective premium adjustments relating to prior loss years will be recorded in the Town’s basic financial statements in the year they become known. During the fiscal year ended June 30, 2022, the Town contributed $134,526 for current year coverage.
Prior to January 2018 the Town participated in ABAG Plan Corporation, a non-profit public benefit corporation established to provide liability insurance coverage, claims and risk management, and legal defense to its participating members. On January 16, 2018, ABAG Plan Corporation transitioned to PLAN JPA.
Audited financial information for the JPA may be obtained from PLAN JPA at 1750 Creekside Oaks Drive, Suite 200, Sacramento, CA 95833.
B. Workers Compensation Coverage
The State Compensation Insurance Fund covers workers compensation claims up to $200,000 for each claim and has coverage above that limit to a maximum of $1,000,000. The Town has no deductible for these claims. During the fiscal year ended June 30, 2022, the Town contributed $38,297 for current year coverage.
C. Liability for Uninsured Claims
The Town has retained the risk for the deductible or uninsured portion of general liability claims.
The Town’s liability for uninsured claims at June 30, 2022 is believed by management to be de minimis based on the absence of any asserted claims.
TOWN OF PORTOLA VALLEY
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2022
NOTE 9 – JOINT POWERS AGREEMENT
A. C/CAG
The Town participates in the City/County Association of Governments of San Mateo County (C/CAG), which is governed by a board consisting of a representative from each member. The board controls the operations of C/CAG, including selection of management and approval of operating budgets, independent of any influence by each member beyond member representation on the Board.
C/CAG was established under a 1990 Joint Exercise of Powers Agreement between the Town, San Mateo County and a majority of cities within San Mateo County for the purpose of developing State mandated plans such as an integrated waste management plan. The Town makes annual nonrefundable contributions to C/CAG which are used along with other member contributions to finance C/CAG operations. Audited financial statements may be obtained from the Town of San Carlos, 666 Elm Street, San Carlos, California, 94070. The Town's payments to C/CAG during the year totaled $15,005. The Town's share of year-end assets, liabilities, or fund equity has not been calculated by C/CAG.
B. San Mateo County Free Library Systems
The Town is a participant with the County of San Mateo in the San Mateo County Free Library System (the Library System), a joint powers agency created to provide extended library services to the residents of the Town and the County. The Agency is governed by a 12-member board made up of a representative from each participating City or Town. The Agency shall continue, uninterrupted, until two thirds of the members vote to terminate the Agency. However, an individual member can terminate its membership, at which the agreement shall terminate on June 30 of the following fiscal year. Upon individual member termination, the member would not be entitled to the return of any funds contributed to the Joint Powers Agency nor to the return in cash or in kind of any materials or supplies contributed. Upon full termination of the Joint Powers Agency the member would receive any surplus money on hand proportionate to its contribution to the Joint Powers Agency. However, all property acquired by the Joint Powers Agency during the term of the agreement shall become the property of the County Free Library System. The Library System’s financial statements can be obtained by contacting the San Mateo Library System, 25 Tower Road, San Mateo, CA 94402.
NOTE 10 – COMMITMENT AND CONTINGENT LIABILITIES
A. Outstanding Litigation
The Town is subject to litigation arising in the normal course of business. In the opinion of the Town Attorney there is no pending litigation which is likely to have a material adverse effect on the financial position of the Town. Litigation outstanding in prior years has been settled without material cost to the Town.
This Page Left Intentionally Blank
REQUIRED SUPPLEMENTARY INFORMATION
TOWN OF PORTOLA VALLEY
Pension Plan
Schedule of the Proportionate Share of the Net Pension Liabilities (Assets) Last 10 Fiscal Years*
Measurement Date 6/30/2014 6/30/2015 6/30/2016 6/30/2017 6/30/2018 6/30/2019 6/30/2020 6/30/2021 Plan's proportion of the Net Pension Liability
(Asset) 0.03873% 0.00301% 0.01508% 0.01807% 0.01778% 0.00310% 0.00353% -0.02682% Plan's proportion share of the Net Pension
Liability (Asset) $957,322 $82,489 $523,840 $712,486 $670,105 $836,271 $1,029,705 ($45,763) Plan's Covered Payroll $993,466 $1,071,540 $1,442,039 $1,522,511 $1,524,652 $1,550,930 $1,628,561 $1,938,663 Plan's Proportionate Share of the Net Pension
Liability/(Asset) as a Percentage of its Covered
Payroll 96.36% 7.70% 36.33% 46.80% 43.95% 53.92% 63.23% -2.36% Plan's Fiduciary Net Position as a Percentage of
the Total Pension Liability 79.82% 78.40% 74.06% 73.31% 75.26% 75.26% 75.10% 88.29% Benefit changes. The figures above do not include any liability impact tat may have resulted from plan changes which occurred after June 30. This applies for voluntary benefit changes as well as any offers of Two Years Additional Service Credit (a.k.a Golden Handshakes).
Changes in assumptions. GASB 68, paragraph 68 states that the long-term expected rate of return should be determined net of pension plan investment expense, but without reduction for pension plan administrative expense. From 2018 to 2020, there were no changes. In 2017, the accounting discount rate reduced from 7.65% to 7.15%. In 2015, amounts reported reflect an adjustment of the discount rate from
7.5% (net of administrative expense) to 7.65% (without a reduction for pension plan administrative expense).
In 2014, amounts reported are based on the 7.5% discount rate. All other assumptions for the June 30, 2014 measurement date were the same as those used for the June 30, 2015 and 2016 measurement dates. * Fiscal year 2015 was the 1st year of implementation. Additional years will be displayed as they become available.
Pension Plan
Fiscal Year Ended June 30 6/30/2015 6/30/2016 6/30/2017 6/30/2018 6/30/2019 6/30/2020 6/30/2021 6/30/2022 Actuarially determined contribution $111,313 $84,007 $116,123 $141,356 $153,312 $205,746 $232,527 $267,420 Contributions in relation to the actuarially
determined contributions (111,313) (84,007) (116,123) (141,356) (153,312) (205,746) (232,527) (267,420) Additional Contributions (907,699)
Contribution deficiency (excess) ($907,699) $0 $0 $0 $0 $0 $0 $0 Covered payroll $993,466 $1,071,540 $1,442,039 $1,522,511 $1,524,652 $1,550,930 $1,628,561 $1,938,623 Contributions as a percentage of covered payroll 11.20% 7.84% 8.05% 9.28% 10.06% 13.27% 14.28% 13.79% Notes to Schedule
Valuation date 6/30/2012 6/30/2013 6/30/2014 6/30/2015 6/30/2016 6/30/2017 6/30/2018 6/30/2019 Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry Age
Amortization method Level percentage of payroll
Remaining amortization period 15 Years as of the Valuation Date Asset valuation method Market Value of Assets
Inflation 2.50%
Varies by Entry Age and Service
Investment rate of return
7.50% for 2015 to 2018,
7.375% for 2019, 7.25% for 2020, 7.00% for 2021, and 7.15% for 2022 net of pension plan investment expense, including inflation Retirement age The probabilities of Retirement are
are based on the CalPERS Experience Study
Mortality
The mortality table used was developed based on CalPERS-specific data.
The table includes 15 years of mortality improvements using Society of Actuaries Scale 90% of scale MP 2016. For more details on this table, please refer to the December 2017 experience study report (based on CalPERS demographic data from 1997 to 2015)
that can be found on the CalPERS website.
* Fiscal year 2015 was the 1st year of implementation. Additional years will be displayed as they become available.
Salary increase
TOWN OF PORTOLA VALLEY
SCHEDULE OF CONTRIBUTIONS
Last 10 Fiscal Years*
TOWN OF PORTOLA VALLEY
OPEB Plan
SCHEDULE OF CHANGES IN THE
NET OPEB LIABILITIES (ASSETS) AND RELATED RATIOS
Last 10 fiscal years*
Measurement Date 6/30/18 6/30/19 6/30/2020 6/30/21 6/30/22 NET OPEB Liability (1)
Service Cost $92,662 $92,662 $120,877 $108,443 $60,118
Interest 35,711 29,825 29,294 41,523
Changes of benefit terms
Differences between expected and actual experience
Economic gains or losses (84,838) (62,829) (85,347) (380,979) Changes of assumptions 258,913 56,159 (451,120) (185,030) Contribution from employer (566,703) (78,745)
Contribution from employee (8,760)
Net investment income 80,367
Administrative expense 133
Benefit payments (51,432) (6,456) (6,456)
Net change in net OPEB liability 41,230 295,992 137,576 (965,433) (471,373) Net OPEB liabilities - beginning 782,641 823,871 1,119,863 1,257,439 292,006 Net OPEB liabilities (Assets) - ending (a) $823,871 $1,119,863 $1,257,439 $292,006 ($179,367) Covered-employee payroll $1,522,511 $1,524,652 $1,550,930 $1,628,561 $1,938,663 NET OPEB liability as a percentage of covered-employee payroll 54.11% 73.45% 81.08% 17.93% -9.25% Notes to Schedule:
(1) No assets are accumulated in a trust that meets the criteria in paragraph 4 of Governmental Accounting Standards Board Statement No. 75. * Fiscal year 2018 was the first year of implementation.
TOWN OF PORTOLA VALLEY
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2022
Variance
Positive
Original Budget Final Budget Actual (Negative)
REVENUES
Taxes:
Property taxes $3,531,136 $3,531,136 $3,803,444 $272,308 Sales tax 235,000 235,000 358,582 123,582
Utility users tax 762,990 762,990 781,252 18,262
Business license tax and other taxes 125,000 125,000 92,734 (32,266) Total Taxes 4,654,126 4,654,126 5,036,012 381,886
Franchise fees 371,175 371,175 414,689 43,514
Agency revenues 5,256 5,256 5,268 12
Licenses and permits 252,000 252,000 335,442 83,442
Service charges and fees 646,081 646,081 803,286 157,205 Investment and other revenues (137,484) 137,484 (1,897) (139,381) Total Revenues 5,668,896 6,188,380 6,690,239 501,859
EXPENDITURES
General government 3,092,725 3,092,725 3,653,707 (560,982) Parks and recreation 121,500 121,500 89,211 32,289
Town center facilities 152,914 152,914 93,387 59,527
Public safety 1,567,830 1,567,830 1,540,640 27,190
Public works 964,366 964,366 807,841 156,525
Total Expenditures 5,899,335 5,899,335 6,184,786 (285,451) Excess (Deficiency) of Revenues
Over Expenses (230,439) 289,045 505,453 216,408
OTHER FINANCING SOURCES (USES)
Transfers (out) (897,080) (897,080) (897,080)
Total Other Financing Sources (Uses) (897,080) (897,080) (897,080) NET CHANGE IN FUND BALANCE ($1,127,519) ($608,035) (391,627) $216,408 Fund balance at beginning of year, as restated 5,465,067 Fund balance at end of year $5,073,440
TOWN OF PORTOLA VALLEY
OPEN SPACE RESTRICTED SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2022
Variance
Original and Positive
Final Budget Actual (Negative)
REVENUES
Utility users tax $337,497 $347,222 $9,725
Contribution 1,000 300 (700)
Investment and other revenues 143,863 (53,590) (197,453) Total Revenues 482,360 293,932 (188,428)
EXPENDITURES
Capital improvement program 102 (102)
Total Expenditures 102 (102)
Excess (Deficiency) of Revenues
Over Expenses 482,360 293,830 188,530
Net change in fund balance $482,360 293,830 ($188,530)
Fund balance at beginning of year 7,277,792
Fund balance at end of year $7,571,622
TOWN OF PORTOLA VALLEY
MEASURE A SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2022
Variance
Original and Positive
Final Budget Actual (Negative)
REVENUES
Sales tax $343,809 $343,809
Investment and other revenues (4,842) (4,842)
Total Revenues 338,967 338,967
EXPENDITURES
Capital improvement program $299,938 299,938
Total Expenditures 299,938 299,938
Net change in fund balance ($299,938) 39,029 $338,967
Fund balance at beginning of year 703,451
Fund balance at end of year $742,480
NOTE TO BUDGETARY SCHEDULES
The Town follows these procedures annually in establishing the budgetary data reflected in the financial statements:
1. The Town Manager submits a proposed budget to the Finance Committee for review and approval.
2. The Town Manager then submits to the Town Council a recommended draft budget for the fiscal year commencing the following July 1. The budget includes proposed expenditures and the means of financing them.
3. The Town Council reviews the proposed budget at one of its regularly scheduled meetings which is open to the public. The Council also conducts a public hearing on the proposed budget to obtain comments from interested persons.
4. Prior to July 1, the budget is adopted through the passage of a resolution. All appropriations lapse at year end.
5. From the effective date of the budget, which is adopted and controlled by the Town Manager at the fund level, the amounts stated therein as proposed expenditures become appropriations to the various Town activities. The Town Council may amend the budget by resolution during the fiscal year.
6. Capital Projects Funds are budgeted on an annual basis. If a capital project is not completed in a budget year, it is included in the subsequent budget year, if necessary. Inclusionary Inlieu Capital Project Fund was not budgeted.
SUPPLEMENTARY INFORMATION
This Page Left Intentionally Blank
NON-MAJOR GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS:
PUBLIC SAFETY
Accounts for half-cent State sales tax revenue designated exclusively for local agency public safety services, (Sec. 35 of Art. XIII of California Constitution).
GAS TAX
Accounts for gasoline tax allocated by the state for street maintenance, repair and improvement.
PUBLIC SAFETY COPS (Citizens’ Options for Public Safety) Accounts for the Supplemental State law Enforcement Fund Service Account (SLESA) revenue for special law and traffic enforcement established by SB89.
LIBRARY FUND
Accounts for library service revenue from San Mateo County Library JPA that can only be used for library-related activities.
MEASURE M
Accounts for County-generated motor vehicle registration fee revenue for traffic congestion and water pollution mitigation programs.
MEASURE W
Accounts for amounts restricted for the Town’s share of a one-half cent sales tax revenue for road repairs and construction.
FROG POND OS RD REMNANT
To account for contributions received to support maintenance of the road remnant adjacent to the Frog Pond.
ARPA CORONAVIRUS RECOVERY
To account for American Rescue Plan Act (ARPA) received in response to the COVID-19 shutdown.
NON-MAJOR GOVERNMENTAL FUNDS (Continued)
CAPITAL PROJECTS FUNDS:
PARK IN-LIEU
Accounts for the subdivision developer’s fee restricted for parks or recreational purposes.
GRANTS
Accounts for various grant activities.
CAPITAL PROJECTS
Accounts for federal or state-reimbursed storm-related road repairs as needed.
This Page Left Intentionally Blank
Public
Public Safety Library
Safety Gas Tax COPS Fund
ASSETS
Cash and investments $3,715 $326,221 $164,444 $49,261
Accounts and interest receivable 35,248
Total Assets $3,715 $361,469 $164,444 $49,261
LIABILITIES
Accounts payable $57,591 $3,630
Total Liabilities 57,591 3,630
FUND BALANCES (DEFICIT)
Restricted $3,715 303,878 $164,444 45,631
Total Fund Balance 3,715 303,878 164,444 45,631
Total Liabilities and Fund Balances $3,715 $361,469 $164,444 $49,261 Special Revenue Funds
TOWN OF PORTOLA VALLEY
NON-MAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
JUNE 30, 2022
Special
Revenue Funds Capital Projects Funds
Frog Pond ARPAOS Rd Coronavirus Park Capital
Measure M Measure W Remnant Recovery In-Lieu Grants Projects Totals $56,248 $385,908 $27,571 $402,133 $35,086 $133,482 $707,766 $2,291,835 16,199 51,447
$56,248 $402,107 $27,571 $402,133 $35,086 $133,482 $707,766 $2,343,282 $2,027 $2,486 $46,146 $111,880
2,027 2,486 46,146 111,880
54,221 $402,107 $27,571 399,647 $35,086 $133,482 661,620 2,231,402 54,221 402,107 27,571 399,647 35,086 133,482 661,620 2,231,402 $56,248 $402,107 $27,571 $402,133 $35,086 $133,482 $707,766 $2,343,282
Public
Public Safety Library
Safety Gas Tax COPS Fund
REVENUES
Taxes:
Sales tax $17,776
Gas tax $215,171
Total taxes 17,776 215,171
Agency revenues
Grants $161,285
Contributions
Investment and other revenues (1,653) (1,099) ($650)
Total Revenues 17,776 213,518 160,186 (650)
EXPENDITURES
General government
Town center facilities 62,498
Public safety 15,000 145,000
Public works 163,670
Capital improvement program 83,723
Total Expenditures 15,000 247,393 145,000 62,498
OTHER FINANCING SOURCES
Transfers in 121,151
Total other financing sources 121,151
Net change in fund balances 2,776 87,276 15,186 (63,148) Fund balances at beginning of year 939 216,602 149,258 108,779 Fund balances (deficit) at end of year $3,715 $303,878 $164,444 $45,631 Special Revenue Funds
TOWN OF PORTOLA VALLEY
NON-MAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED JUNE 30, 2022
Special
Revenue Funds Capital Projects Funds
Frog Pond ARPAOS Rd Coronavirus Park Capital
Measure M Measure W Remnant Recovery In-Lieu Grants Projects Totals $168,358 $186,134
215,171
168,358 401,305
$217,211 $546,381 763,592
$3,400 164,685
$27,625 27,625
(54) ($257) (3,713)
217,211 168,358 27,571 546,381 (257) 3,400 1,353,494
70,810 70,810
62,498
160,000
13,178 3,741 180,589
67,060 2,351 72,183 $329,613 554,930
80,238 2,351 146,734 329,613 1,028,827
775,929 897,080
775,929 897,080
136,973 166,007 27,571 399,647 (257) 3,400 446,316 1,221,747 (82,752) 236,100 35,343 130,082 215,304 1,009,655
$54,221 $402,107 $27,571 $399,647 $35,086 $133,482 $661,620 $2,231,402
TOWN OF PORTOLA VALLEY
NON-MAJOR GOVERNMENTAL FUNDS
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2022
Public Safety Gas Tax
Variance Variance
Positive Positive
Budget Actual (Negative) Budget Actual (Negative)
REVENUES
Taxes
Sales tax $15,000 $17,776 $2,776
Gas tax $215,791 $215,171 ($620)
Total taxes 15,000 17,776 2,776 215,791 215,171 (620)
Agency revenues
Grants
Contributions
Investment and other revenues 5,263 (1,653) (6,916)
Total Revenues 15,000 17,776 2,776 221,054 213,518 (7,536)
EXPENDITURES
General government
Town center facilities
Public safety 15,000 15,000
Public works 262,132 163,670 98,462
Capital improvement program 80,073 83,723 (3,650)
Total Expenditures 15,000 15,000 342,205 247,393 94,812 Excess (Deficiency) of Revenues
Over Expenses 2,776 2,776 (121,151) (33,875) 87,276
OTHER FINANCING SOURCES
Transfers in 121,151 121,151
Transfers out
Total Other Financing Sources 121,151 121,151
Net change in fund balances 2,776 $2,776 87,276 $87,276 Fund balances, beginning of Year 939 216,602
Fund balances (deficit), end of Year $3,715 $303,878
Public Safety COPS Library Fund Measure M
Variance Variance Variance
Positive Positive Positive
Budget Actual (Negative) Budget Actual (Negative) Budget Actual (Negative) $217,211 $217,211
$145,000 $161,285 $16,285
2,614 (1,099) (3,713) $6,695 ($650) ($7,345)
147,614 160,186 12,572 6,695 (650) (7,345) 217,211 217,211 87,737 62,498 25,239
145,000 145,000
$15,142 13,178 1,964
67,060 67,060
145,000 145,000 87,737 62,498 25,239 82,202 80,238 1,964 2,614 15,186 12,572 (81,042) (63,148) 17,894 (82,202) 136,973 219,175 $2,614 15,186 $12,572 ($81,042) (63,148) $17,894 ($82,202) 136,973 $219,175 149,258 108,779 (82,752)
$164,444 $45,631 $54,221
(Continued)
TOWN OF PORTOLA VALLEY
NON-MAJOR GOVERNMENTAL FUNDS
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2022
Measure W Frog Pond OS Rd Ramnant
Variance Variance
Positive Positive
Budget Actual (Negative) Budget Actual (Negative)
REVENUES
Taxes
Sales tax $132,860 $168,358 $35,498
Gas tax
Total taxes 132,860 168,358 35,498
Agency revenues
Grants
Contributions $27,625 $27,625
Investment and other revenues (54) (54)
Total Revenues 132,860 168,358 35,498 27,571 27,571
EXPENDITURES
Town center facilities
Town center facilities
Public safety
Public works
Capital improvement program 61,000 2,351 58,649
Total Expenditures 61,000 2,351 58,649
Excess (Deficiency) of Revenues
Over Expenses 71,860 166,007 94,147 27,571 27,571
OTHER FINANCING SOURCES
Transfers in
Transfers out
Total Other Financing Sources
Net change in fund balances $71,860 166,007 $94,147 27,571 $27,571 Fund balances, beginning of Year 236,100
Fund balances (deficit), end of Year $402,107 $27,571
ARPA - Coronavirus Recovery Park in Lieu Grants
Variance Variance Variance
Positive Positive Positive
Budget Actual (Negative) Budget Actual (Negative) Budget Actual (Negative) $118,000 $546,381 $428,381
$3,400 $3,400
$788 ($257) ($1,045)
118,000 546,381 428,381 788 (257) (1,045) 3,400 3,400
108,000 70,810 37,190
5,000 3,741 1,259
201,000 72,183 128,817
314,000 146,734 167,266
(196,000) 399,647 595,647 788 (257) (1,045) 3,400 3,400 ($196,000) 399,647 $595,647 $788 (257) ($1,045) $3,400 3,400 35,343 130,082
$399,647 $35,086 $133,482
(Continued)
TOWN OF PORTOLA VALLEY
NON-MAJOR GOVERNMENTAL FUNDS
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2022
Capital Projects
Variance
Positive
Budget Actual (Negative)
REVENUES
Taxes
Sales tax
Gas tax
Total taxes
Agency revenues
Grants
Contributions
Investment and other revenues
Total Revenues
EXPENDITURES
Town center facilities
Town center facilities
Public safety
Public works
Capital improvement program $691,929 $329,613 $362,316
Total Expenditures 691,929 329,613 362,316
Excess (Deficiency) of Revenues
Over Expenses (691,929) (329,613) 362,316
OTHER FINANCING SOURCES
Transfers in 775,929 775,929
Transfers out
Total Other Financing Sources 775,929 775,929
Net change in fund balances $84,000 446,316 $362,316
Fund balances, beginning of Year 215,304
Fund balances (deficit), end of Year $661,620
CUSTODIAL FUNDS
Custodial Funds are presented separately from the Government-wide and Fund financial statements.
Custodial Funds account for assets held by the Town as agent for individuals, governmental entities, and non-public organizations.
MAINTENANCE DISTRICTS
Accounts for all revenues and expenditures related to the following maintenance districts formed to maintain roads within the individual district boundaries with governance separate from the Town Council.
The Town acts as a fiduciary custodian for the maintenance district assessment revenue collected and disbursed from the County:
CRESCENT MAINTENANCE DISTRICT
PORTOLA VALLEY RANCH MAINTENANCE DISTRICT
WAYSIDE ROAD I MAINTENANCE DISTRICT
WAYSIDE ROAD II MAINTENANCE DISTRICT
WOODSIDE HIGHLANDS MAINTENANCE DISTRICT
Crescent Maintenance Portola Valley Ranch Wayside Road I District Maintenance District Maintenance District
ASSETS
Cash and investments $178,667 $35,870 $147,931
Accounts and interest receivable 167 11
Total Assets 178,834 35,881 147,931
LIABILITIES
Deposits and other liabilities 152,987 34,129 225,549
Total Liabilities 152,987 34,129 225,549
NET POSITION
Restricted for:
Maintenance Districts 25,847 1,752 (77,618)
Total Net Position (Deficit) $25,847 $1,752 ($77,618)
TOWN OF PORTOLA VALLEY
Custodial Funds
JUNE 30, 2022
CUSTODIAL FUNDS
COMBINING STATEMENT OF NET POSITION
Wayside Road II Wayside Highlands
Maintenance District Maintenance District Total
$206,163 $393,285 $961,916
2,169 715 3,062
208,332 394,000 964,978
106,867 403,640 923,172
106,867 403,640 923,172
101,465 (9,640) 41,806
$101,465 ($9,640) $41,806
Custodial Funds
Crescent Maintenance Portola Valley Ranch Wayside Road I District Maintenance District Maintenance District
ADDITIONS
Fee Collection $25,847 $1,752 $2,382
Total Additions 25,847 1,752 2,382
DEDUCTIONS
Distributions to districts 80,000
Total Deductions 80,000
Net increase (decrease) in fiduciary net position 25,847 1,752 (77,618) Net Position, beginning of the year
Net Position, end of the year $25,847 $1,752 ($77,618)
COMBINING STATEMENT OF CHANGES IN NET POSITION
TOWN OF PORTOLA VALLEY
Custodial Funds
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
CUSTODIAL FUNDS
Wayside Road II Wayside Highlands
Maintenance District Maintenance District Total
$103,149 $65,358 $198,488
103,149 65,358 198,488
1,684 74,998 156,682
1,684 74,998 156,682
101,465 (9,640) 41,806
$101,465 ($9,640) $41,806
Custodial Funds
This Page Left Intentionally Blank
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
To the Honorable Members of the Town Council
Town of Portola Valley, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the basic financial statements of the Town of Portola Valley, California (Town), as of and for the year ended June 30, 2022, and have issued our report thereon dated August 11, 2025.
Report on Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the Town’s internal control over financial reporting (internal control) to determine the 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 Town’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Town’s internal control.
Our consideration of internal control was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. However, as discussed below, we did identify certain deficiencies in internal control that we consider to be material weaknesses and significant deficiencies.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the Town’s financial statements will not be prevented, or detected and corrected on a timely basis. We consider the deficiencies as listed on the Schedule of Material Weaknesses included as part of our separately issued Memorandum on Internal Control dated August 11, 2025 to be material weaknesses, which is an integral part of our audit and should be read in conjunction with this report.
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. We consider the deficiencies as listed on the Status of Prior Year Significant Deficiencies included as part of our separately issued Memorandum on Internal Control dated August 11, 2025 to be significant deficiencies, which is an integral part of our audit and should be read in conjunction with this report.
Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Town’s financial statements are free from 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 determination of financial statement amounts. However, providing an opinion on compliance with those provisions was 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 that are required to be reported under Government Auditing Standards.
We have also issued a separate Memorandum on Internal Control dated August 11, 2025 which is an integral part of our audit and should be read in conjunction with this report.
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 Town’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 Town’s internal control and compliance.
Accordingly, this communication is not suitable for any other purpose.
Pleasant Hill, California
August 11, 2025
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
FOR THE YEAR ENDED JUNE 30, 2022
Item #7a - Attachment 2
This Page Left Intentionally Blank
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
For The Year Ended June 30, 2022
Table of Contents
Page
Memorandum on Internal Control ................................................................................................................... 1 Schedule of Material Weakness ............................................................................................................... 3 Schedule of Significant Deficiencies ....................................................................................................... 5 Schedule of Other Matters ....................................................................................................................... 7 Status of Prior Year Significant Deficiencies ........................................................................................ 19 Status of Prior Year Other Matters ........................................................................................................ 23
This Page Left Intentionally Blank
1 MEMORANDUM ON INTERNAL CONTROL
To the Honorable Mayor and Members of the Town Council
Town of Portola Valley, California
In planning and performing our audit of the basic financial statements of the Town as of and for the year ended June 30, 2022, in accordance with auditing standards generally accepted in the United States of America, we considered the Town’s internal control over financial reporting 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 Town’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Town’s internal control.
Our consideration of internal control was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore material weaknesses or significant deficiencies may exist that were not identified. In addition, because of inherent limitations in internal control, including the possibility of management override of controls, misstatements due to error or fraud may occur and not be detected by such controls. However, as discussed below, we identified certain deficiencies in internal control that we consider to be significant deficiencies.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the Town’s financial statements will not be prevented, or detected and corrected on a timely basis. We consider the deficiencies in internal control included on the Schedule of Material Weaknesses to be material weaknesses.
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. We consider the deficiencies in internal control included in the Status of Prior Year Significant Deficiencies to be significant deficiencies.
Included in the Schedule of Other Matters are recommendations not meeting the above definitions that we believe are opportunities for strengthening internal controls and operating efficiency.
Management’s written responses included in this report have not been subjected to the audit procedures applied in the audit of the financial statements and, accordingly, we express no opinion on them.
This communication is intended solely for the information and use of management, Town Council, others within the organization, and agencies and pass-through entities requiring compliance with Government Auditing Standards, and is not intended to be and should not be used by anyone other than these specified parties.
Pleasant Hill, California
August 11, 2025
This Page Left Intentionally Blank
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF MATERIAL WEAKNESS
2022-01: Prior Year Significant Deficiency Not Implemented During the current year audit, we followed up on the status of Significant Deficiencies identified on the Status of Prior Year Significant Deficiencies:
1. 2021-02 Journal Entry Reviews, Approvals, and Timeliness
2. 2021-03 Timely Bank Reconciliations
3. 2020-01 Timeliness for the Completion of Audit
and found that the deficiencies had not been mitigated as of June 30, 2022. Therefore, they are deemed to be the current year's Material Weakness.
Details of these deficiencies and associated management responses are listed in the Status of Prior Year Significant Deficiencies.
Current Status as of June 30, 2022:
See Management’s Response to the Current Year Status for the above deficiencies as listed in the Status of Prior Year Significant Deficiencies.
This Page Left Intentionally Blank
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF SIGNIFICANT DEFICIENCIES
2022-02: Prior Year Significant Deficiency Not Implemented During the current year audit, we followed up on the status of Significant Deficiencies identified on the Status of Prior Year Significant Deficiencies:
4. 2021-01 Segregation of Duties,
5. 2020-01 Timeliness for the Completion of Audit
and found that the deficiencies had not been mitigated as of June 30, 2022. Therefore, they are deemed to be the current year's Significant Deficiencies.
Details of these deficiencies and associated management responses are listed in the Status of Prior Year Significant Deficiencies.
Current Status as of June 30, 2022:
See Management’s Response to the Current Year Status for the above deficiencies as listed in the Status of Prior Year Significant Deficiencies.
This Page Left Intentionally Blank
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
2022-03: Out of Compliance with Government Code 53646
Criteria: California Government Code 53646 states that the treasurer or chief fiscal officer may render a quarterly report to the chief executive officer, the internal auditor, and the legislative body of the local agency. The quarterly report shall be so submitted within 30 days following the end of the quarter covered by the report.
Condition: The Town did not prepare the quarterly treasurer’s reports in the fiscal year 2022.
Cause: The Town did not prepare the treasury reports due to staff shortage.
Potential Effect: The Town appears to be out of compliance with California Government Code Section 53646 and its own Investment Policy.
Recommendation: The Town should ensure timely preparation and submission of the investment reports to comply with California Government Code Section 53646.
Management Response:
The Town recognizes and agrees with the above findings for the fiscal year 2022 and is actively developing a process that will bring the Town into compliance with California Government Code Section 53646. For the latter part of the fiscal year 2025, reports were presented to the Finance Committee for the last six months of the current fiscal year.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
NEW GASB PRONOUNCEMENTS OR PRONOUNCEMENTS NOT YET EFFECTIVE The following comment represents new pronouncements taking affect in the next few years. We cite them here to keep you informed of developments:
EFFECTIVE FISCAL YEARS 2022, 2023 and 2024:
GASB 99 – Omnibus 2022
The objectives of this Statement are to enhance comparability in accounting and financial reporting and to improve the consistency of authoritative literature by addressing (1) practice issues that have been identified during implementation and application of certain GASB Statements and (2) accounting and financial reporting for financial guarantees. The practice issues addressed by this Statement are as follows:
• Classification and reporting of derivative instruments within the scope of Statement No. 53, Accounting and Financial Reporting for Derivative Instruments, that do not meet the definition of either an investment derivative instrument or a hedging derivative instrument • Clarification of provisions in Statement No. 87, Leases, as amended, related to the determination of the lease term, classification of a lease as a short term lease, recognition and measurement of a lease liability and a lease asset, and identification of lease incentives • Clarification of provisions in Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangements, related to (a) the determination of the public-private and public-public partnership (PPP) term and (b) recognition and measurement of installment payments and the transfer of the underlying PPP asset
• Clarification of provisions in Statement No. 96, Subscription-Based Information Technology Arrangements, related to the subscription-based information technology arrangement (SBITA) term, classification of a SBITA as a short term SBITA, and recognition and measurement of a subscription liability
• Extension of the period during which the London Interbank Offered Rate (LIBOR) is considered an appropriate benchmark interest rate for the qualitative evaluation of the effectiveness of an interest rate swap that hedges the interest rate risk of taxable debt • Accounting for the distribution of benefits as part of the Supplemental Nutrition Assistance Program (SNAP)
• Disclosures related to nonmonetary transactions
• Pledges of future revenues when resources are not received by the pledging government
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
GASB 99 – Omnibus 2022, (Continued)
• Clarification of provisions in Statement No. 34, Basic Financial Statements—and Management’s Discussion and Analysis—for State and Local Governments, as amended, related to the focus of the government-wide financial statements
• Terminology updates related to certain provisions of Statement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position • Terminology used in Statement 53 to refer to resource flows statements.
The Requirements of this Statement are Effective as Follows:
The requirements in paragraphs 26–32 related to extension of the use of LIBOR, accounting for SNAP distributions, disclosures of nonmonetary transactions, pledges of future revenues by pledging governments, clarification of certain provisions in Statement 34, as amended, and terminology updates related to Statement 53 and Statement 63 are effective upon issuance.
The requirements in paragraphs 11–25 related to leases, PPPs, and SBITAs are effective for fiscal years beginning after June 15, 2022, and all reporting periods thereafter.
The requirements in paragraphs 4–10 related to financial guarantees and the classification and reporting of derivative instruments within the scope of Statement 53 are effective for fiscal years beginning after June 15, 2023, and all reporting periods thereafter.
Earlier application is encouraged and is permitted by individual topic.
How the Changes in This Statement Will Improve Financial Reporting The requirements of this Statement will enhance comparability in the application of accounting and financial reporting requirements and will improve the consistency of authoritative literature. Consistent authoritative literature enables governments and other stakeholders to more easily locate and apply the correct accounting and financial reporting provisions, which improves the consistency with which such provisions are applied. The comparability of financial statements also will improve as a result of this Statement. Better consistency and comparability improve the usefulness of information for users of state and local government financial statements.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
EFFECTIVE FISCAL YEAR 2022/23:
GASB 91 – Conduit Debt Obligations
The primary objectives of this Statement are to provide a single method of reporting conduit debt obligations by issuers and eliminate diversity in practice associated with (1) commitments extended by issuers, (2) arrangements associated with conduit debt obligations, and (3) related note disclosures. This Statement achieves those objectives by clarifying the existing definition of a conduit debt obligation; establishing that a conduit debt obligation is not a liability of the issuer; establishing standards for accounting and financial reporting of additional commitments and voluntary commitments extended by issuers and arrangements associated with conduit debt obligations; and improving required note disclosures.
A conduit debt obligation is defined as a debt instrument having all of the following characteristics:
• There are at least three parties involved:
(1) an issuer
(2) a third-party obligor, and
(3) a debt holder or a debt trustee.
• The issuer and the third-party obligor are not within the same financial reporting entity. • The debt obligation is not a parity bond of the issuer, nor is it cross-collateralized with other debt of the issuer.
• The third-party obligor or its agent, not the issuer, ultimately receives the proceeds from the debt issuance.
• The third-party obligor, not the issuer, is primarily obligated for the payment of all amounts associated with the debt obligation (debt service payments).
All conduit debt obligations involve the issuer making a limited commitment. Some issuers extend additional commitments or voluntary commitments to support debt service in the event the third party is, or will be, unable to do so.
An issuer should not recognize a conduit debt obligation as a liability. However, an issuer should recognize a liability associated with an additional commitment or a voluntary commitment to support debt service if certain recognition criteria are met. As long as a conduit debt obligation is outstanding, an issuer that has made an additional commitment should evaluate at least annually whether those criteria are met. An issuer that has made only a limited commitment should evaluate whether those criteria are met when an event occurs that causes the issuer to reevaluate its willingness or ability to support the obligor’s debt service through a voluntary commitment.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
GASB 91 – Conduit Debt Obligations (Continued)
This Statement also addresses arrangements—often characterized as leases—that are associated with conduit debt obligations. In those arrangements, capital assets are constructed or acquired with the proceeds of a conduit debt obligation and used by third-party obligors in the course of their activities.
Payments from third-party obligors are intended to cover and coincide with debt service payments.
During those arrangements, issuers retain the titles to the capital assets. Those titles may or may not pass to the obligors at the end of the arrangements.
Issuers should not report those arrangements as leases, nor should they recognize a liability for the related conduit debt obligations or a receivable for the payments related to those arrangements. In addition, the following provisions apply:
• If the title passes to the third-party obligor at the end of the arrangement, an issuer should not recognize a capital asset.
• If the title does not pass to the third-party obligor and the third party has exclusive use of the entire capital asset during the arrangement, the issuer should not recognize a capital asset until the arrangement ends.
• If the title does not pass to the third-party obligor and the third party has exclusive use of only portions of the capital asset during the arrangement, the issuer, at the inception of the arrangement, should recognize the entire capital asset and a deferred inflow of resources. The deferred inflow of resources should be reduced, and an inflow recognized, in a systematic and rational manner over the term of the arrangement.
This Statement requires issuers to disclose general information about their conduit debt obligations, organized by type of commitment, including the aggregate outstanding principal amount of the issuers’ conduit debt obligations and a description of each type of commitment. Issuers that recognize liabilities related to supporting the debt service of conduit debt obligations also should disclose information about the amount recognized and how the liabilities changed during the reporting period.
How the Changes in this Statement will Improve Financial Reporting The requirements of this Statement will improve financial reporting by eliminating the existing option for issuers to report conduit debt obligations as their own liabilities, thereby ending significant diversity in practice. The clarified definition will resolve stakeholders’ uncertainty as to whether a given financing is, in fact, a conduit debt obligation. Requiring issuers to recognize liabilities associated with additional commitments extended by issuers and to recognize assets and deferred inflows of resources related to certain arrangements associated with conduit debt obligations also will eliminate diversity, thereby improving comparability in reporting by issuers. Revised disclosure requirements will provide financial statement users with better information regarding the commitments issuers extend and the likelihood that they will fulfill those commitments. That information will inform users of the potential impact of such commitments on the financial resources of issuers and help users assess issuers’ roles in conduit debt obligations.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
GASB 94 – Public-Private and Public-Public Partnerships and Availability Payment Arrangements The primary objective of this Statement is to improve financial reporting by addressing issues related to public-private and public-public partnership arrangements (PPPs). As used in this Statement, a PPP is an arrangement in which a government (the transferor) contracts with an operator (a governmental or nongovernmental entity) to provide public services by conveying control of the right to operate or use a nonfinancial asset, such as infrastructure or other capital asset (the underlying PPP asset), for a period of time in an exchange or exchange-like transaction. Some PPPs meet the definition of a service concession arrangement (SCA), which the Board defines in this Statement as a PPP in which (1) the operator collects and is compensated by fees from third parties; (2) the transferor determines or has the ability to modify or approve which services the operator is required to provide, to whom the operator is required to provide the services, and the prices or rates that can be charged for the services; and (3) the transferor is entitled to significant residual interest in the service utility of the underlying PPP asset at the end of the arrangement.
This Statement also provides guidance for accounting and financial reporting for availability payment arrangements (APAs). As defined in this Statement, an APA is an arrangement in which a government compensates an operator for services that may include designing, constructing, financing, maintaining, or operating an underlying nonfinancial asset for a period of time in an exchange or exchange-like transaction.
PPPs – This Statement requires that PPPs that meet the definition of a lease apply the guidance in Statement No. 87, Leases, as amended, if existing assets of the transferor that are not required to be improved by the operator as part of the PPP arrangement are the only underlying PPP assets and the PPP does not meet the definition of an SCA. This Statement provides accounting and financial reporting requirements for all other PPPs: those that either (1) meet the definition of an SCA or (2) are not within the scope of Statement 87, as amended (as clarified by this Statement). The PPP term is defined as the period during which an operator has a noncancelable right to use an underlying PPP asset, plus, if applicable, certain periods if it is reasonably certain, based on all relevant factors, that the transferor or the operator either will exercise an option to extend the PPP or will not exercise an option to terminate the PPP.
A transferor generally should recognize an underlying PPP asset as an asset in financial statements prepared using the economic resources measurement focus. However, in the case of an underlying PPP asset that is not owned by the transferor or is not the underlying asset of an SCA, a transferor should recognize a receivable measured based on the operator’s estimated carrying value of the underlying PPP asset as of the expected date of the transfer in ownership. In addition, a transferor should recognize a receivable for installment payments, if any, to be received from the operator in relation to the PPP.
Measurement of a receivable for installment payments should be at the present value of the payments expected to be received during the PPP term. A transferor also should recognize a deferred inflow of resources for the consideration received or to be received by the transferor as part of the PPP. Revenue should be recognized by a transferor in a systematic and rational manner over the PPP term.
This Statement requires a transferor to recognize a receivable for installment payments and a deferred inflow of resources to account for a PPP in financial statements prepared using the current financial resources measurement focus. Governmental fund revenue would be recognized in a systematic and rational manner over the PPP term.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
GASB 94 – Public-Private and Public-Public Partnerships and Availability Payment Arrangements, (Continued)
This Statement also provides specific guidance in financial statements prepared using the economic resources measurement focus for a government that is an operator in a PPP that either (1) meets the definition of an SCA or (2) is not within the scope of Statement 87, as amended (as clarified in this Statement). An operator should report an intangible right-to-use asset related to an underlying PPP asset that either is owned by the transferor or is the underlying asset of an SCA. Measurement of the right-touse asset should be the amount of consideration to be provided to the transferor, plus any payments made to the transferor at or before the commencement of the PPP term, and certain direct costs. For an underlying PPP asset that is not owned by the transferor and is not the underlying asset of an SCA, an operator should recognize a liability measured based on the estimated carrying value of the underlying PPP asset as of the expected date of the transfer in ownership. In addition, an operator should recognize a liability for installment payments, if any, to be made to the transferor in relation to the PPP. Measurement of a liability for installment payments should be at the present value of the payments expected to be made during the PPP term. An operator also should recognize a deferred outflow of resources for the consideration provided or to be provided to the transferor as part of the PPP. Expense should be recognized by an operator in a systematic and rational manner over the PPP term.
This Statement also requires a government to account for PPP and non-PPP components of a PPP as separate contracts. If a PPP involves multiple underlying assets, a transferor and an operator in certain cases should account for each underlying PPP asset as a separate PPP. To allocate the contract price to different components, a transferor and an operator should use contract prices for individual components as long as they do not appear to be unreasonable based on professional judgment or use professional judgment to determine their best estimate if there are no stated prices or if stated prices appear to be unreasonable. If determining the best estimate is not practicable, multiple components in a PPP should be accounted for as a single PPP.
This Statement also requires an amendment to a PPP to be considered a PPP modification, unless the operator’s right to use the underlying PPP asset decreases, in which case it should be considered a partial or full PPP termination. A PPP termination should be accounted for by a transferor by reducing, as applicable, any receivable for installment payments or any receivable related to the transfer of ownership of the underlying PPP asset and by reducing the related deferred inflow of resources. An operator should account for a termination by reducing the carrying value of the right-to-use asset and, as applicable, any liability for installment payments or liability to transfer ownership of the underlying PPP asset. A PPP modification that does not qualify as a separate PPP should be accounted for by remeasuring PPP assets and liabilities.
APAs – An APA that is related to designing, constructing, and financing a nonfinancial asset in which ownership of the asset transfers by the end of the contract should be accounted for by a government as a financed purchase of the underlying nonfinancial asset. This Statement requires a government that engaged in an APA that contains multiple components to recognize each component as a separate arrangement. An APA that is related to operating or maintaining a nonfinancial asset should be reported by a government as an outflow of resources in the period to which payments relate.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
GASB 96 – Subscription-Based Information Technology Arrangements This Statement provides guidance on the accounting and financial reporting for subscription-based information technology arrangements (SBITAs) for government end users (governments). This Statement (1) defines a SBITA; (2) establishes that a SBITA results in a right-to-use subscription asset—an intangible asset—and a corresponding subscription liability; (3) provides the capitalization criteria for outlays other than subscription payments, including implementation costs of a SBITA; and (4) requires note disclosures regarding a SBITA. To the extent relevant, the standards for SBITAs are based on the standards established in Statement No. 87, Leases, as amended.
A SBITA is defined as a contract that conveys control of the right to use another party’s (a SBITA vendor’s) information technology (IT) software, alone or in combination with tangible capital assets (the underlying IT assets), as specified in the contract for a period of time in an exchange or exchange-like transaction.
The subscription term includes the period during which a government has a noncancelable right to use the underlying IT assets. The subscription term also includes periods covered by an option to extend (if it is reasonably certain that the government or SBITA vendor will exercise that option) or to terminate (if it is reasonably certain that the government or SBITA vendor will not exercise that option).
Under this Statement, a government generally should recognize a right-to-use subscription asset—an intangible asset—and a corresponding subscription liability. A government should recognize the subscription liability at the commencement of the subscription term, —which is when the subscription asset is placed into service. The subscription liability should be initially measured at the present value of subscription payments expected to be made during the subscription term. Future subscription payments should be discounted using the interest rate the SBITA vendor charges the government, which may be implicit, or the government’s incremental borrowing rate if the interest rate is not readily determinable. A government should recognize amortization of the discount on the subscription liability as an outflow of resources (for example, interest expense) in subsequent financial reporting periods.
The subscription asset should be initially measured as the sum of (1) the initial subscription liability amount, (2) payments made to the SBITA vendor before commencement of the subscription term, and (3) capitalizable implementation costs, less any incentives received from the SBITA vendor at or before the commencement of the subscription term. A government should recognize amortization of the subscription asset as an outflow of resources over the subscription term.
Activities associated with a SBITA, other than making subscription payments, should be grouped into the following three stages, and their costs should be accounted for accordingly:
• Preliminary Project Stage, including activities such as evaluating alternatives, determining needed technology, and selecting a SBITA vendor. Outlays in this stage should be expensed as incurred. • Initial Implementation Stage, including all ancillary charges necessary to place the subscription asset into service. Outlays in this stage generally should be capitalized as an addition to the subscription asset.
• Operation and Additional Implementation Stage, including activities such as subsequent implementation activities, maintenance, and other activities for a government’s ongoing operations related to a SBITA. Outlays in this stage should be expensed as incurred unless they meet specific capitalization criteria.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
GASB 96 – Subscription-Based Information Technology Arrangements, (Continued) In classifying certain outlays into the appropriate stage, the nature of the activity should be the determining factor. Training costs should be expensed as incurred, regardless of the stage in which they are incurred.
If a SBITA contract contains multiple components, a government should account for each component as a separate SBITA or nonsubscription component and allocate the contract price to the different components. If it is not practicable to determine a best estimate for price allocation for some or all components in the contract, a government should account for those components as a single SBITA.
This Statement provides an exception for short-term SBITAs. Short-term SBITAs have a maximum possible term under the SBITA contract of 12 months (or less), including any options to extend, regardless of their probability of being exercised. Subscription payments for short-term SBITAs should be recognized as outflows of resources.
This Statement requires a government to disclose descriptive information about its SBITAs other than short-term SBITAs, such as the amount of the subscription asset, accumulated amortization, other payments not included in the measurement of a subscription liability, principal and interest requirements for the subscription liability, and other essential information.
How the Changes in this Statement will Improve Financial Reporting The requirements of this Statement will improve financial reporting by establishing a definition for SBITAs and providing uniform guidance for accounting and financial reporting for transactions that meet that definition. That definition and uniform guidance will result in greater consistency in practice.
Establishing the capitalization criteria for implementation costs also will reduce diversity and improve comparability in financial reporting by governments. This Statement also will enhance the relevance and reliability of a government’s financial statements by requiring a government to report a subscription asset and subscription liability for a SBITA and to disclose essential information about the arrangement. The disclosures will allow users to understand the scale and important aspects of a government’s SBITA activities and evaluate a government’s obligations and assets resulting from SBITAs.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
EFFECTIVE FISCAL YEAR 2023/24:
GASB 100 – Accounting for Changes and Error Corrections The primary objective of this Statement is to enhance accounting and financial reporting requirements for accounting changes and error corrections to provide more understandable, reliable, relevant, consistent, and comparable information for making decisions or assessing accountability.
This Statement defines accounting changes as changes in accounting principles, changes in accounting estimates, and changes to or within the financial reporting entity and describes the transactions or other events that constitute those changes. As part of those descriptions, for (1) certain changes in accounting principles and (2) certain changes in accounting estimates that result from a change in measurement methodology, a new principle or methodology should be justified on the basis that it is preferable to the principle or methodology used before the change. That preferability should be based on the qualitative characteristics of financial reporting—understandability, reliability, relevance, timeliness, consistency, and comparability. This Statement also addresses corrections of errors in previously issued financial statements.
This Statement prescribes the accounting and financial reporting for (1) each type of accounting change and (2) error corrections. This Statement requires that (a) changes in accounting principles and error corrections be reported retroactively by restating prior periods, (b) changes to or within the financial reporting entity be reported by adjusting beginning balances of the current period, and (c) changes in accounting estimates be reported prospectively by recognizing the change in the current period. The requirements of this Statement for changes in accounting principles apply to the implementation of a new pronouncement in absence of specific transition provisions in the new pronouncement. This Statement also requires that the aggregate amount of adjustments to and restatements of beginning net position, fund balance, or fund net position, as applicable, be displayed by reporting unit in the financial statements.
This Statement requires disclosure in notes to financial statements of descriptive information about accounting changes and error corrections, such as their nature. In addition, information about the quantitative effects on beginning balances of each accounting change and error correction should be disclosed by reporting unit in a tabular format to reconcile beginning balances as previously reported to beginning balances as restated.
Furthermore, this Statement addresses how information that is affected by a change in accounting principle or error correction should be presented in required supplementary information (RSI) and supplementary information (SI). For periods that are earlier than those included in the basic financial statements, information presented in RSI or SI should be restated for error corrections, if practicable, but not for changes in accounting principles.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
EFFECTIVE FISCAL YEAR 2024/25:
GASB 101 – Compensated Absences
The objective of this Statement is to better meet the information needs of financial statement users by updating the recognition and measurement guidance for compensated absences. That objective is achieved by aligning the recognition and measurement guidance under a unified model and by amending certain previously required disclosures.
Recognition And Measurement
This Statement requires that liabilities for compensated absences be recognized for (1) leave that has not been used and (2) leave that has been used but not yet paid in cash or settled through noncash means. A liability should be recognized for leave that has not been used if (a) the leave is attributable to services already rendered, (b) the leave accumulates, and (c) the leave is more likely than not to be used for time off or otherwise paid in cash or settled through noncash means. Leave is attributable to services already rendered when an employee has performed the services required to earn the leave. Leave that accumulates is carried forward from the reporting period in which it is earned to a future reporting period during which it may be used for time off or otherwise paid or settled. In estimating the leave that is more likely than not to be used or otherwise paid or settled, a government should consider relevant factors such as employment policies related to compensated absences and historical information about the use or payment of compensated absences. However, leave that is more likely than not to be settled through conversion to defined benefit postemployment benefits should not be included in a liability for compensated absences.
This Statement requires that a liability for certain types of compensated absences—including parental leave, military leave, and jury duty leave—not be recognized until the leave commences. This Statement also requires that a liability for specific types of compensated absences not be recognized until the leave is used.
This Statement also establishes guidance for measuring a liability for leave that has not been used, generally using an employee’s pay rate as of the date of the financial statements. A liability for leave that has been used but not yet paid or settled should be measured at the amount of the cash payment or noncash settlement to be made. Certain salary-related payments that are directly and incrementally associated with payments for leave also should be included in the measurement of the liabilities.
With respect to financial statements prepared using the current financial resources measurement focus, this Statement requires that expenditures be recognized for the amount that normally would be liquidated with expendable available financial resources.
Notes To Financial Statements
This Statement amends the existing requirement to disclose the gross increases and decreases in a liability for compensated absences to allow governments to disclose only the net change in the liability (as long as they identify it as a net change). In addition, governments are no longer required to disclose which governmental funds typically have been used to liquidate the liability for compensated absences.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
How the Changes in this Statement Will Improve Financial Reporting The unified recognition and measurement model in this Statement will result in a liability for compensated absences that more appropriately reflects when a government incurs an obligation. In addition, the model can be applied consistently to any type of compensated absence and will eliminate potential comparability issues between governments that offer different types of leave.
The model also will result in a more robust estimate of the amount of compensated absences that a government will pay or settle, which will enhance the relevance and reliability of information about the liability for compensated absences.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
STATUS OF PRIOR YEAR SIGNIFICANT DEFICIENCIES
2021-01 Segregation of Duties
Criteria: Effective internal control must be maintained at any organization, regardless of size and intricacy. Good internal controls require that employees with access to the assets not have access to the accounting records for the same assets. Reconciliations of any accounts should be performed by separate individuals to ensure segregation of duties.
Condition: During our review of internal controls, we noted areas in which controls need to be improved, and employee access and/or duties should be revised:
a) The payroll run was reviewed by the same employee who processes payroll. There was no evidence of a separate employee reviewing the payroll register. The same employee also prepared and input the payroll journal entries into the general ledger without a separate employee review. In addition, there is no evidence of documentation of the preparer and reviewer for the payroll register. b) The vendor database is managed by the same staff who was also involved in processing accounts payable.
Cause: Due to the Town's staff turnover, financial system upgrade, and impacts from the pandemic, the Town did not have enough finance staff to ensure sufficient segregation of duties in various transaction cycles. The tight labor market during the pandemic year further delayed recruitment. The staff shortage delayed the finance department from preparing and reconciling financial activities for the audit in a timely manner.
Potential Effect: Assets or accounts recorded and reviewed by the same staff do not permit good checks, transparency, accuracy, or segregation of duties and increase the likelihood that material misstatement in the financial statement will not be prevented or detected and corrected on a timely basis.
Recommendation: Good internal control dictates that the same employee with access to physical assets should not also have access to updating account records for the same assets. A different employee should be involved in the records or assets to provide a good check and balance. The Town should analyze staff resources to ensure proper review and segregation of duties.
Current Status as of June 30, 2022:
We noted the conditions described above remained unchanged for the fiscal year 2022.
Management Response to Current Status and Recommendations:
The Town recognizes and agrees with the above findings for the fiscal year 2022 and has implemented a process that allows for the following,
a) The payroll journal entry is reconciled to the payroll register and is reviewed by the finance director before posting.
b) The vendor database is updated by an employee other than the employee processing accounts payable.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
STATUS OF PRIOR YEAR SIGNIFICANT DEFICIENCIES
2021-02 Journal Entry Reviews, Approvals, and Timeliness Criteria: Journal entries (JE) are an important transaction cycle affecting all accounting and financial reporting aspects. Prudent internal control concepts dictate that:
1. No single employee should process a transaction without the involvement of another employee.
2. A second employee should review and approve the entry prepared by the first employee, with evidence of signing and dating for the approval.
3. The JE should be prepared, reviewed, and posted within 30-45 days of the event's occurrence.
Condition: We sample-tested the Town’s JE and noted the following:
c) The JEs tested showed no separate reviewer other than the preparer. d) Five JEs had reviewed and posted dates six months later than the original preparation dates:
Cause: Due to the Town's staff turnover, financial system upgrade, and impacts from the pandemic, the Town did not have enough finance staff to ensure sufficient segregation of duties in various transaction cycles. The tight labor market during the pandemic year further delayed recruitment. The staff shortage delayed the finance department from preparing and reconciling financial activities for the audit in a timely manner.
Potential Effect: Journal entry preparation and reviewing by the same staff does not permit good checks, transparency, accuracy, or segregation of duties and increase the likelihood that material misstatement in the financial statement will not be prevented or detected and corrected on a timely basis.
When journal entries are not posted in a timely manner, there is an increased risk that transactions are not posted in the correct period, and accounting errors, misstatements, or unauthorized transactions may not be identified or corrected in a timely manner.
Recommendation: We recommend that the Town implement a park and place function that allows someone to create entries and then alerts and allows the authorized employees to review and approve the entry before posting. We also recommended that the town work on submitting journal entries in a timely manner.
Current Status as of June 30, 2022:
We noted the conditions described above remained for the fiscal year 2022.
Management Response to Current Status and Recommendations:
The Town recognizes and agrees with the above findings for the fiscal year 2022 and has implemented a process that allows for the review and approval of journal entries in a timelier manner.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
STATUS OF PRIOR YEAR SIGNIFICANT DEFICIENCIES
2021-03 Timely Bank Reconciliations
Criteria: Bank account reconciliations are one of the most important internal controls. To be effective, bank reconciliations and the associated review should be completed in their entirety as soon as reasonably possible after each month's end, usually within 30-45 days of the bank statement date. Additionally, reconciliations should be dated and signed off by the preparer and reviewer to leave an audit trail.
Condition: We noted that the bank reconciliation for fiscal year 2021, was not completed and reviewed until the fiscal year of 2024, more than three years later.
Cause: Due to the Town's staff turnover, financial system upgrade, and impacts from the pandemic, the Town did not have enough finance staff to ensure timely preparation and review of the financials in various transaction cycles. The tight labor market during the pandemic year further delayed recruitment.
The staff shortage delayed the finance department from preparing and reconciling financial activities for the audit in a timely manner.
Potential Effect: Without timely preparation and review for the bank reconciliation, there is an increased risk that misstatements or unauthorized transactions will not be prevented, detected, and corrected on a timely basis.
Recommendation: We recommend that the Town maintain adequate qualified staff to ensure that bank reconciliations are prepared and reviewed promptly, ideally within 30-45 days of the close of a given month. Also, the preparer and reviewer should date and sign off reconciliations to maintain proper audit trail.
Current Status as of June 30, 2022:
We noted the conditions described above remained for the fiscal year 2022.
Management Response to Current Status and Recommendations:
The Town recognizes and agrees with the above findings for the fiscal year 2022 and is actively working on implementing a process that allows for timelier preparation and review of reconciliations of the bank statements.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
STATUS OF PRIOR YEAR SIGNIFICANT DEFICIENCIES
2020-01 Timeliness for the Completion of Audit
Criteria: Well-managed organizations should develop a plan to ensure that adequate resources will remain available in the event of employee departures and the potential impact of unexpected events. Part of that is ensuring there are resources available to be utilized on short notice to fill gaps in key positions, especially in the Finance Department. These resources need to be in place throughout the fiscal year to ensure accounting processes and procedures continue and allow time for the analysis of account balances and activities.
Condition: The Town’s basic financial statements for the year ended June 30, 2020, were not completed until October 2022.
Cause: Due to the Town's staff turnover, financial system upgrade, and impacts from the pandemic, the Town's staff were not able to prepare and complete recording financial activities for the audit timely.
Effect: As a result, there were significant delays in the completion of the audit, which increases the risk that errors or misstatements may go undetected by staff and corrections may not be made in a timely manner. Audit effort was substantially increased due to the delay and coordination.
Recommendation: The Town should analyze staff resources for backup plans to ensure that the financial data is processed properly and timely during staffing transitions and unexpected events.
Current Status as of June 30, 2022:
The Town was not able to assemble the essential audit items for the fiscal year 2022 until mid-May 2025.
Management Response to Current Status and Recommendations:
The Town recognizes and agrees with the above findings for fiscal year 2022 and has built up staff resources to ensure that financial data is processed properly and timely during the fiscal year 2025 and that the backlog of audits will be completed during fiscal year ended June 30, 2026.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
STATUS OF PRIOR YEAR OTHER MATTERS
2021-04 Reconciliation of Payroll Journal Entries with the Payroll Register Criteria: The payroll journal entries prepared by one employee should be reconciled with the payroll register and reviewed by a separate employee before posting to the general ledger.
Condition: During the payroll testing, we noted that the payroll journal entries for the pay period ending on March 31, 2021, were not reconciled with the payroll register and were not reviewed before posting them to the general ledger.
Potential Effect: The above condition does not promote good checks and balances for payroll processing. Without proper reconciliation of the payroll journal entries with the payroll register and separate review, there is an increased risk that misstatements or unauthorized transactions will not be prevented, detected, and corrected on a timely basis.
Cause: Due to the Town's staff turnover, financial system upgrade, and impacts from the pandemic, the Town did not have enough finance staff to ensure sufficient segregation of duties and timely preparation and review of the financials in various transaction cycles. The tight labor market during the pandemic year further delayed recruitment. The staff shortage delayed the finance department from preparing and reconciling financial activities for the audit in a timely manner.
Recommendation: We recommend that the City establish procedures for an employee who does not have edit rights in the City’s payroll system to review the payroll register after every payroll run. If this is deemed impossible under the current staffing situation, cross-review should be performed by the two employees who have access to the payroll module.
In addition, the payroll JE prepared should be reconciled with the payroll register and reviewed properly before posting to the general ledger.
Current Status as of June 30, 2022:
We noted the conditions described above remained for the fiscal year 2022.
Management Response to Current Status and Recommendations:
The Town recognizes and agrees with the above findings for the fiscal year 2022 and has implemented a process where the payroll journal entry is reconciled with the payroll register and is reviewed by the finance director before posting.
TOWN OF PORTOLA VALLEY
MEMORANDUM ON INTERNAL CONTROL
STATUS OF PRIOR YEAR OTHER MATTERS
2021-05 Outstanding Checks
Criteria: The town’s policy is to follow up every six months on checks that have been outstanding for over a year.
Condition: We noted that of all the outstanding checklists accompanying the June 2021 Bank Reconciliation, twenty-five outstanding checks were over a year old.
Cause: Due to the town's staff turnover, financial system upgrades, and impacts from the pandemic, the town did not have enough finance staff to follow up on the outstanding checks in a timely manner.
Potential Effect: This practice does not promote proper internal control over disbursements.
Recommendation: We recommend that the Town follow up and clear the stale check timely.
Current Status as of June 30, 2022:
We noted the conditions described above remained for the fiscal year 2022.
Management Response to Current Status and Recommendations:
The Town recognizes and agrees with the above findings for fiscal year 2022 and is actively working on developing a process that allows for a timelier review and clearance of stale dated checks. 2021-06 Out of compliance with the Investment Policy
Criteria: The Town’s Investment Policy stated that it shall be adopted by resolution and reviewed as a part of the annual budget process with any amendments to be approved by the council.
Condition: It appeared that the council did not review the Investment Police as part of the annual budget process.
Potential Effect: The Town is out of compliance with its own Investment Policy.
Cause: The Town’s investment policy has not changed since 2012. Hence the review process was overlooked.
Recommendation: We recommend that the Town to review the investment policy annually alongside the annual budget process.
Current Status as of June 30, 2022:
Implemented
TOWN OF PORTOLA VALLEY
REQUIRED COMMUNICATIONS
FOR THE YEAR ENDED JUNE 30, 2022
Item #7a - Attachment 3
This Page Left Intentionally Blank
TOWN OF PORTOLA VALLEY
REQUIRED COMMUNICATIONS
For The Year Ended June 30, 2022
Table of Contents
Page
Required Communications ................................................................................................................................ 1 Significant Audit Matters:
Qualitative Aspects of Accounting Practices ................................................................................... 1 Disclosures ......................................................................................................................................... 2 Difficulties Encountered in Performing the Audit ........................................................................... 3 Corrected and Uncorrected Misstatements ...................................................................................... 3 Disagreements with Management .................................................................................................... 3 Management Representations ............................................................................................................ 3 Management Consultations with Other Independent Accountants ................................................. 3 Other Audit Findings or Issues .......................................................................................................... 3 Other Matters ............................................................................................................................................ 4
This Page Left Intentionally Blank
REQUIRED COMMUNICATIONS
To the Honorable Mayor and Members of the Town Council
Town of Portola Valley, California
We have audited the basic financial statements of the Town of Portola Valley (Town) for the year ended June 30, 2022. 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 audit. We have communicated such information in our engagement letter to you dated July 15, 2025, and the SAS 114 & 99 communication letter dated August 7, 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
Accounting Policies - Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the Town are described in Note 1 to the financial statements. No new accounting policies were adopted and the application of existing policies was not changed during the year. The following pronouncements became effective, but did not have a material effect on the financial statements:
GASB 87 – Leases
GASB 89 – Accounting for Interest Cost Incurred before the End of a Construction Period GASB 90 – Majority Equity Interests (an amendment of GASB Statements No. 14 and No. 61) GASB 92 – Omnibus 2020
GASB 93 – Replacement of Interbank Offered Rates
GASB 97 – Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans—An Amendment of GASB Statements No. 14 and No. 84, and a Supersession of GASB Statement No. 32 GASB 99 – Omnibus 2022
Unusual Transactions, Controversial or Emerging Areas - We noted no transactions entered into by the Town 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 - Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the Town’s financial statements were:
Estimated Fair Value of Investments: As of June 30, 2022, the Town held approximately $20.9 million of cash and investments as measured by fair value as disclosed in Note 2 to the financial statements. Fair value is essentially market pricing in effect as of June 30, 2022. These fair values are not required to be adjusted for changes in general market conditions occurring subsequent to June 30, 2022.
Estimate of Depreciation: Management’s estimate of the depreciation is based on useful lives determined by management. These lives have been determined by management based on the expected useful life of assets as disclosed in Note 3 to the financial statements. We evaluated the key factors and assumptions used to develop the depreciation estimate and determined that it is reasonable in relation to the basic financial statements taken as a whole.
Estimate of Compensated Absences: Accrued compensated absences which are comprised of accrued vacation, holiday, and certain other compensating time is estimated using accumulated unpaid leave hours and hourly pay rates in effect at the end of the fiscal year as disclosed in Note 1 to the financial statements. We evaluated the key factors and assumptions used to develop the accrued compensated absences and determined that it is reasonable in relation to the basic financial statements taken as a whole.
Estimated Claims Liabilities: Management’s estimate of the claims liabilities payable is disclosed in Note 8 to the financial statements and is based on actuarial studies determined by a consultant, which are based on the claims experience of the Town. We evaluated the key factors and assumptions used to develop the estimate and determined that it is reasonable in relation to the basic financial statements taken as a whole.
Estimated Net Pension Liabilities (Assets) and Pension-Related Deferred Outflows and Inflows of Resources: Management’s estimate of the net pension liabilities (assets) and deferred outflows/inflows of resources are disclosed in Note 6 to the financial statements and are based on actuarial studies determined by a consultant, which are based on the experience of the Town. We evaluated the key factors and assumptions used to develop the estimate and determined that it is reasonable in relation to the basic financial statements taken as a whole.
Estimated Net OPEB Liabilities (Assets) and Pension-Related Deferred Outflows and Inflows of Resources: Management’s estimate of the net OPEB liabilities (assets) is disclosed in Note 7 to the financial statements and is based on actuarial study determined by a consultant, which is based on the experience of the Town. We evaluated the key factors and assumptions used to develop the estimate and determined that it is reasonable in relation to the basic financial statements taken as a whole.
Disclosures
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, except as noted:
The Town experienced unusual difficulty during the fiscal year 2022 year-end close. The Town was in the process of an upgrade for its financial system during the year while dealing with finance staff turnover, plus the COVID-19 pandemic impact on the Town’s overall operation which lasted for over two years. Although Town staff worked diligently throughout the process and provided full cooperation to our audit, the current year’s audit was adversely affected. The Town’s finance staff had difficulty assembling the various required audit items timely. As a result, the audit completion was significantly delayed.
Corrected and Uncorrected Misstatements
Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are clearly trivial, and communicate them to the appropriate level of management. Management has corrected all such misstatements. In addition, none of the misstatements detected as a result of audit procedures and corrected by management were material, either individually or in the aggregate, to each opinion unit’s financial statements taken as a whole.
Professional standards require us to accumulate all known and likely uncorrected misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management. We have no such misstatements to report to the Town Council.
Disagreements with Management
For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor’s report. We are pleased to report that no such disagreements arose during the course of our audit.
Management Representations
We have requested certain representations from management that are included in a management representation letter dated August 11, 2025.
Management Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation involves application of an accounting principle to the Town’s financial statements or a determination of the type of auditor’s opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants.
Other Audit Findings or Issues
We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the Town’s auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention.
Other Matters
We applied certain limited procedures to the required supplementary information that accompanies and supplements the basic financial statements. Our procedures consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We did not audit the required supplementary information and do not express an opinion or provide any assurance on the required supplementary information.
We were engaged to report on the supplementary information which accompany the financial statements, but are not required supplementary information. With respect to this supplementary information, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves.
******
This information is intended solely for the use of Town Council and management and is not intended to be, and should not be, used by anyone other than these specified parties.
Pleasant Hill, California
August 11, 2025
There are no written materials for
Item 7b
Item #7b
______________________________________________________________________________________ TO: Members of the Town Council
FROM: Councilmember Mary Hufty
DATE: September 8, 2025
RE: Geologic Safety Committee
Liaison Report: Safety and Resilience Initiatives
A review of the Town Council’s draft Safety and Resilience Initiatives was undertaken.
Previous efforts of the Geologic Safety Committee (GSC) are being incorporated, with an emphasis on synchronizing projects to address cumulative risks—including flood, landslide, earthquake, and fire—for integration into the Safety Element. Updating resident information remains a continuing need.
Best Practices and Community Engagement
• Recognizing that multiple hazards are both diverse and cumulative, examples from Japan were discussed. Steve Ingebritson is currently studying models there. • The Committee suggested inviting a speaker on this subject. Ross Stein (see Ross Stein) was identified as a possible presenter.
• A monthly educational speaker series was proposed, sponsored by the Committee with town support for facilities and technical assistance.
Geologic Mapping and Development
• Updated geologic maps are needed for development purposes. Coordination is ongoing between Town Staff, GSC, and geologic consultant John Wallace. • A joint meeting is targeted for October 13, 2025. Staff is asked to confirm the list of preparatory materials Wallace is compiling.
• Wallace previously provided a list of geologic survey priorities (2014) and a map update (2017).
TOWN OF PORTOLA VALLEY
Liaison Memo
Item #8a
Evacuation Routes and Facilities
• GSC prepared an evacuation routes map (2025), which needs broader distribution.
• The Maintenance Shed, located within the Sausal Creek setback and on the San Andreas Fault, presents risks. Alternate employee evacuation routes exist and could be coordinated with residents.
• Questions remain about whether Public Works is prepared to check and secure evacuation routes immediately following a disaster.
Community Preparedness
• Many residents are still unaware of available post-earthquake support systems.
Rapid notification systems are not yet assured.
• Utility companies are reviewing flexibility standards for gas, electric, water, and septic lines that cross faults.
• Broader planning is needed to determine:
o How the town will sustain itself after a disaster.
o Where Command Central will be located for initial response. o How residents will be notified in the first hours after an event.
Resources and Standards
• Emergency water supply: Eight water tanks in town, including one gravity-fed tank. • The posted evacuation map should be updated to replace it with the more detailed GSC map (showing water tanks, fire roads, locks, slides, creeks, and faults). • The Passive House Standard (tight air-sealed construction, steel shell) was discussed as an alternative to Title 24.
Next Steps
• Consider establishing monthly second-Tuesday educational meetings (Conservation, GSC, etc.).
• The GSC November meeting will focus on reviewing the Safety Element (11/2022) to ensure readiness for the update. To date, most committee comments from 2022—available on the Town Website under Planning & Building → Safety Element—have not yet been incorporated.
• Final responsibility for emergency response remains with the Town Manager.
_________________________________________________________________________________ TO: Mayor and Members of the Town Council
FROM: Councilmember Rebecca Flynn
DATE: 08/06/2025
RE: Liaison report on SFO Roundtable Meeting (08/06/2025) COMMUNITY INFORMATION ITEMS:
Report on Noise tracking: Portola Valley continues to report significant levels of noise. Thank you to all those who are reporting the noise. Last two monthly Airport Director’s reports. Noise levels reported by city for March and April begin on pages 7 and 14, respectively. https://sforoundtable.org/wp-content/uploads/2025/08/Updated-Minutes-on-Agenda-Packet-forAugust-6-2025.pdf Please continue to report aircraft noise at one of these sites:
• https://stop.jetnoise.net/
• https://noise.flysfo.com/
• https://webtrak.emsbk.com/sfo13 (WebTrak) (Click on the relevant noisy plane and then click the tiny little bubble comment icon on the very bottom left of the popup panel to submit the noise complaint) Note the time on the dashboard. The site runs with a 3-5 minutes delay.
TL/DR (Too Long/Didn’t Read) FULL MEETING NOTES:
Public Comments:
Ann Schneider - concerns about Air taxis
John Hamilton, a resident of Alameda, commented on the impact of flight departures on Bay Farm Island.
Chair report
Member dues sent out in July – due August.
Noise Report
70K reports a month on noise
Bot in Foster city calling in noise reports.
Noise ombudsman eliminated. Noise complaints through FAA – ANCIR – Diane Estipona will circulate the FAA memo.
SFO Noise software update allows for automatic correlation with outside noise events.
Darleen Yap: Request for temporary monitoring in Palo Alto.
Remi Tan – monitoring around the area important.
TOWN OF PORTOLA VALLEY
SFO Roundtable Liaison Update
Item #8b
Repair and Replacement initiative
$7million already committed – $1.5 million per year. New applicants would need additional funding.
Second Chance initiative. $20 million already committed - $3 million this year.
EEI - $12 million already committed.
Roundtable Annual Work Plan - 2025-2026 approved
• Strategic Plan Goal 1: Strengthen Engagement with Federal, State, Regional and Local Delegations on Airport Noise Reduction Initiatives.
• Strategic Plan Goal 2: Develop and Enhance Coordination Plan for the Technical Working Group focused on Noise Mitigation, Ground Based Noise and Flight Operations Oversight o The Roundtable Technical Working Group will monitor the development and o implementation of Advanced Air Mobility aircrafts such as air taxi, eVTOL, and o drones. As appropriate, the TWG will make recommendations to the • Strategic Plan Goal 3: Coordinate closely with SFO’s Noise Abatement Office to Address Airport Operation Noise
• Strategic Goal 4: Provide comprehensive review of SFO’s Fly Quiet Program, with recommendations and implementation support, to ensure efficacy and strengthen compliance tracking and accountability
• Strategic Goal 5: Enhance Public Education on Noise Mitigation Efforts and Address Community Concerns
• Strategic Goal 6: Increase Roundtable effectiveness with inward focused Member education and support
Public Comments
Darleen Yaplee. Update Goal 2 Item 5 - Strengthen the language – review and access Air taxi language – provide cities with recommended uniform guidelines around new air technology.
Update Goal 4 – tie to 6 elements
Ann Schneider – Noise and add Air pollution - charter question Response
SFO – 5 years out for Advanced Air Mobility, negotiating with big box stores for take off and landing.
Incentive program (excludes nighttime)
– new routes – get landing fee waived for a year
- Cannot reduce delay times due to laws
Openings on the TWG. (Technical Working Group)
SFO flow presentation
Jon Hamilton – nighttime plan - cargo planes take a u turn onto SUNNY Public Comment: Ann Schneider = concerns about accurate maps showing noise.
______________________________________________________________________________________ TO: Mayor and Members of the Town Council
FROM: Councilmember Rebecca Flynn
DATE: 08/26/2025
RE: Report of 08/26/2025 Conservation Committee meeting Action Items
1. Open position available on the Conservation Committee.
2. Meeting change to 5:30 first Tuesday.
3. Councilmember Flynn to check with Town about putting in place a ban on rodenticides.
4. Shady Trail parklet overgrown – joint subcommittee needs to let Town know that it needs to be mown – work with Open Space and Town – check with Open Space committee for funding for maintenance
Notes
1. Bev Goodman, Danna Breen, Nona Chiarello – poppy seeding at poppy corner – looking for volunteers to help spread dirt and mulch.
2. Dittrichia is a problem – Nona contacted Stanford Portola Terrace – Real estate Office has scheduled clearance for stinkwort. Conservation Committee could look into clearing right of way in front of people’s houses without a public works permission.
3. Committee Business
a. Honorary student member Eliza Low added
b. Town Picnic – Marianne drives it, Judy will help.
c. POST – living with coyotes – zoom 8/28/2025 Thursday – promote on PVForum d. Intern for mapping project for wildlife corridors – Duncan Vaughan e. Ordinance to ban rat poison
f. Intern for mapping wildlife from Stanford
g. Plan to meet with Robert Burtt to discuss timing for weeding
4. Fence Ordinance complicated, multiple modifications, focus on stream corridors and ravines and major corridors. 1-2 acres are allowed 6 feet tall fences on side and rear property lines.
Room to Roam bill.
a. Horse fence on all property lines but no wire on bottom 16” b. Domestic fences set at 10’ in
c. Wildlife friendly fence with 16” clearance on the bottom. Could be on the property line.
Horse fence would be a subset of wildlife friendly fences d. No fences on slopes
e. Larger setbacks on riparian corridors.
f. ADU potential pinch point.
TOWN OF PORTOLA VALLEY
Conservation Committee Report
Item #8c
g. Grandfather in existing fences (legal when they were built) h. No double fencing, no cheater fencing (code violation)
5. Dittrichia and star thistle for monthly update. Pruning next month
6. Tar heels blooming.
7. Committee spotlight leave off this month.
8. Mountain Lion video on website
9. Owl box article for Town newsletter by Eliza Low.
10. Rodenticides – resolution done by Town before. Explore increasing ban. Nona and Marianne to plan for fall event. SMC Mosquito and Vector department
11. Conservation Committee site visit template form reviewed.
______________________________________________________________________________________ TO: Mayor and Members of the Town Council
FROM: Councilmember Rebecca Flynn
DATE: 09/08/2025
RE: Report of09/08/2025 ASCC Commission meeting
Notes
Public Comment
• Town Manager Darcy Smith introduced new Planning & Building Director Steve McHarris • Dr. Susan Morris– requested a correction to the minutes from July 28, 2025 to show that the Brookside pillars have not been removed. She has not received an update on the protection of the Brookside pillars.
Agenda
ASCC conditionally approved 111 Escobar - 1132 sf addition, interior remodel, exterior upgrades including decking and pool, and associated site improvements. Metal roofing with new skylights.
Includes a JADU that will be rented. An ASCC subcommittee of 2 members will review updated plans for lighting, some planting, covered deck area, drainage, western retaining wall area and lighting.
TOWN OF PORTOLA VALLEY
ASCC Commission Liaison Report
Item #8d
______________________________________________________________________________________ TO: Mayor and Members of the Town Council
FROM: Councilmember Rebecca Flynn
DATE: 09/19/2025
RE: C/CAG Governing Board Meeting 09/11/2025
ACTION ITEMS:
PV Town Council should be aware that SB63 is working its way through the legislature. The bill would put a regional transit measure on the November 2026 ballot for a ½ cent sales tax (in San Mateo County) for 14 years to pay for reduced congestion by supporting public transit agencies in the San Mateo, San Francisco, Alameda, and Contra Costa counties to prevent severe service cutbacks while ridership improves to pre-pandemic levels. The measure is a “citizen’s measure,” meaning it will require 50%+1 to pass. Polling in the different counties suggests support.
MEETING NOTES:
Presentation from Joint Venture Silicon Valley – Russell Hancock. Produce a yearly index.
https://ccag.ca.gov/wp-content/uploads/2025/09/2.2-_-A1_SV-Joint-Venture-Presentation.pdf Employment fixed at 1.7m for 3 years running. 75,000 layoffs since August 2022, recalibration since pandemic excessive hiring - 4.4% of total workforce, 13% of tech workforce (on an efficiency kick). Unemployment under 4% (nearly full employment). Aggregate regional market cap reached $25 trillion for SV and SF. In 2024, SV companies received 80% of AI investments. AI employment job intensity in SF Bay area.
Income and wealth – GINI inequality index for Silicon Valley indicating extreme inequality. 154 billionaires and 145,000 millionaires (liquid holdings). If in 90%, your income has grown 30% over the past 20 years. If in the 10%, you’ve lost 3% of your income. Households in top ten percent own 71 percent of the wealth. Households in the bottom half – own only 1%.
Politics : Attitudes towards tech: residents blaming tech for problems in the bay area.
Draft 2026 STIP – State Transportation Improvement Program https://ccag.ca.gov/wp-content/uploads/2025/09/4.2-2026-STIP-Board-Presentation.pdf
TOWN OF PORTOLA VALLEY
C/CAG Governing Board
Item #8e
5 year capital improvement program of state transportation funds from gas tax for most corridor projects. Past projects received funding: US-101/Broadway interchange, US-1010 express lanes, Countywide smart corridor project. US 1010-/Willow Road interchange.
CCAG works with Community /Public Works Directors for major highway programs.
New proposed recommendations;
• US 101 managed lanes projects – north of I-380
• El Camino Real bicycle and pedestrian improvement project (Colma) • US 101/Holly street interchange and over pass (San Carlos) • Pacifica Highway 1/Manor drive overcrossing improvement (Pacifica) • Moss beach state route 1 congestion and safety improvement (SMC) Legislative update
AB1005 – Banning license plate obstruction
AB 650 (Papan) Housing Element Compliance –proposes a three-pronged approach: start the RHNA process earlier, allowing cities to begin planning sooner; require HCD to provide clear feedback and guidance; and offer relief to good actor cities in the form of a stay on the builder’s remedy while they are awaiting a response from HCD.
SB79 –This bill would require that a residential development proposed within one-half or onequarter mile of a transit-oriented development stop be an allowed use on any site zoned for residential, mixed, commercial, and further requires that the development be eligible for streamlined, ministerial approval, while establishing allowable densities on these properties.
SB 63 – approve ½ cent tax for public transportation with strong accountability measures and an adjudication committee about service levels, cleanliness. Includes return to source of funds that are in excess could be used for local transit and repavement of roads for rolling stock.
Other
Rain barrel program will be available with pick up points in Daly City and Half Moon Bay in October and November. Further information will be forthcoming.
______________________________________________________________________________________ TO: Mayor and Members of the Town Council
FROM: Councilmember Rebecca Flynn (Alternate Liaison)
DATE: 09/17/2025
RE: Emergency Services Council Meeting 09/17/2025
ACTION ITEMS:
1. Docusign will be sent to the Town to sign the JPA agreement.
2. Community survey from EM for distribution to the public.
3. EM to hold Agency Readiness seminar 9/18/2025 for agencies.
4. Encourage residents to sign up for SMC Alerts.
5. ESC meetings changed to second Thursdays in 2026.
MEETING NOTES:
4. Glenwood Camp Update
Creating a Cal fire camp for Cal fire workers.
40 people a day during the fire season
Funded for 80 seasonal firefighters 9 months a year (Collect unemployment while 3 months off work or engage in other work)
13 captains and 6 engineers, 1 division chief, 1 battalion chief – permanent staff retention problem because of the pay.
5. Joint Powers Agreement update - all municipalities have approved the MOU. Now need official signatures.
6. Director’s Year End review
1. Emergency Communications – implemented scientifically tested communications frameworks and are doing training on the messaging. Policy and procedures will be finalized next week. And will be brought back to the Municipalities.
2. Community outreach – multi lingual (5+ languages)
3. Training and exercises – 17 trainings this year. (fire, flooding, earthquake, mass destruction exercises.) Including CBOs
7. ESC moving to the third Thursdays at 5:30 pm in 2026
TOWN OF PORTOLA VALLEY
ESC Meeting
Item #8f
8. Effective Alerts and warnings – Dr. Sutton
Effective messages need to include:
1. source of the message
2. named hazard and likely impacts
3. location,
4. Guidance
5. Time – when event is occurring.
Message style - : Clear, complete, consistent, certain, and accurate.
Closure loop needed also – “All Clear”
SMC created Templates, and Message templates uploaded to Rave Video Training and technical assistance available to municipalities.
Alert warning seminar was delivered to all cities and towns and Alert Message Library Agency Readiness Seminar 9/17/2025 for Town Managers
Looking at difference between INFORMATION vs WARNING. Clarify role, geography, and time.
Integrated Wireless emergency alert system available for those who are connected to cell tower. It also provides alerts on the TV as chirons and on the Radio.
SMC alerts are available for those areas that don’t have cell coverage.
Dept EM had a debriefing on the problematic issues with the 280 fire messaging and SMC alerts.
Public needs to know where to go.
EM Created tsunami viewer to help tell people where to go.
9. Emergency Managers in your municipality – can provide answers to the public. Can help educate the public.