Item 4 - Poway Housing Successor Annual Report for Fiscal Year 2023-2024

May 20, 2025, Item #4
DATE:

TO:

FROM:

CONTACT:

SUBJECT:

Summary:

AGENDA REPORT City of Poway

CITY COUNCIL
May 20, 2025
Honorable Chairman and Members of the Housing Authority Board Julie Procopio, Director of Development Services cf
Marie Sanders, Senior Management Analyst
(858) 668-4637 or [email protected]
Poway Housing Successor Annual Report For Fiscal Year 2023-24 Pursuant to California Health and Safety Code Sections 34176 and 34176.1 (f) (Dissolution Law), the Poway Housing Authority, in its capacity as Housing Successor to the dissolved Poway Redevelopment Agency, must prepare an annual report detailing its financial activities each fiscal year. The Poway Housing Successor Annual Report for Fiscal Year 2023-24 (Attachment A), and the Poway Housing Authority Basic Financial Statements and Independent Auditors Report for the year ending June 30, 2024 (Attachment B), are included with this agenda report for review by the Poway Housing Authority Board.

Recommended Action:

It is recommended the Poway Housing Authority Board receive and file this report.

Discussion:

Part 1.85, Division 24 of the California Health and Safety Code, particularly Sections 34176 and 34176.1 (f}, require the Housing Successor provide an annual report of the Successor's activities during the prior fiscal year. The purpose of the report is to provide the governing body of the Housing Successor with an annual report on the housing assets and activities of the Housing Successor. The report is to be provided to the Poway Housing Authority Board, along with an independent financial audit of the Low-and Moderate-Income Housing Asset Fund (LMIHAF) within six months after the end of each fiscal year. Due to Poway's annual timing for completion of the Housing Authority audit, it is not possible for this report to be completed within the six-month period. However, there is no penalty for delayed submission of the report.

The Poway Housing Successor Annual Report for Fiscal Year 2023-24 indicates a balance in the LMIHAF of $5,120,157. LMIHAF monies may be utilized to acquire, rehabilitate, ensure long term affordability covenants for, or preserve lower income housing (affordable to households earning 80 percent of area median income [AMI] or less). Additionally, funds may be used for program administration and monitoring as well as for homelessness prevention and rapid rehousing services. The source of funding for the LMIHAF is derived from the previous balance of Redevelopment financing, program income from operations, repayments of loans, and land sales. 1 of 35
May 20, 2025, Item #4
LMIHAF funding is separate from the housing in-lieu fee collected from the developer of each market rate unit to support the development, acquisition and rehabilitation of affordable housing. The current balance of the Housing In-Lieu fund is $565,725.

During FY 24-25 a significant milestone was achieved. The Monte Vista affordable housing project was approved by the Poway Housing Authority Board and the City Council on November 19, 2024. The approval included a $4,590,000 loan from the Housing Authority to finance the Developer's ground lease of the property. The project will build 60 units, including 18 units affordable to extremely-low income households (30% AMI), 10 units affordable to very-low income households (50% AMI), and 31 units for low-income households (59% AMI). With entitlement complete on the Monte Vista project, funds for an evaluation and identification of additional affordable housing sites survey are proposed in the Fiscal Year 2025-26 budget. This survey will evaluate options and priorities for support of affordable housing.

Environmental Review:

This item is not subject to California Environmental Quality Act (CEQA) review.

Fiscal Impact:

There is no fiscal impact associated with this item.

Public Notification:

None.

Attachments:

A. Poway Housing Successor Annual Report for Fiscal Year 2023-24 B. Poway Housing Authority Basic Financial Statements and Independent Auditors Report for the year ended June 30, 2024
Reviewed/Approved By:

Wendy Kaserman
Assistant City Manager
2 of 35
Reviewed By:

Alan Fenstermacher
City Attorney
e
City Manager
May 20, 2025, Item #4

POWAY HOUSING SUCCESSOR ANNUAL REPORT

REGARDING THE LOW-AND MODERATE-INCOME HOUSING ASSET FUND FOR FISCAL YEAR 2023-2024
PURSUANT TO CALIFORNIA HEALTH AND SAFETY CODE SECTION 34176.1(f)

FOR THE POWAY HOUSING AUTHORITY
This Housing Successor Annual Report (Report) regarding the Low-and Moderate-Income Housing Asset Fund (LMIHAF) has been prepared pursuant to California Health and Safety Code Section 34176.1 (f) and is dated as of December 31, 2024. This Report sets forth certain details of the Poway Housing Authority, in its capacity as Housing Successor to the dissolved Poway Redevelopment Agency, activities during Fiscal Year 2023-24 (Fiscal Year). The purpose of this Report is to provide the governing body of the Housing Successor with an annual report on housing assets and activities of the Housing Successor under Part 1.85, Division 24 of the California Health and Safety Code, in particular sections 34176 and 34176.1 (Dissolution Law).

The following Report is based upon information prepared by Housing Successor staff and information contained within the Poway Housing Authority Basic Financial Statements and Independent Auditor's Report for Fiscal Year 2023-24 as prepared by Davis Farr, LLP, which the Audit is separate from this annual summary report; further, this report conforms with and is organized into sections I. through XII., inclusive, pursuant to the Dissolution Law:

I. Amount Deposited into LMIHAF: This section provides the total amount of funds deposited into the LMIHAF during the Fiscal Year. Any amount deposited for items listed on the Recognized Obligation Payment Schedule (ROPS) must be distinguished from the other amounts deposited.

II. Ending Balance of LMIHAF: This section provides a statement of the balance in the LMIHAF as of the close of the Fiscal Year. Any amount deposited for items listed on the ROPS must be distinguished from the other amounts deposited.

Ill. Description of Expenditures from LMIHAF: This section provides a categorized description of the expenditures made from the LMIHAF during the Fiscal Year.

IV. Statutory Value of Assets Owned by Housing Successor: This section provides the statutory value of real property owned by the Housing Successor, the value of loans and grants receivables, and the sum of these two amounts.

V. Description of Transfers: This section describes transfers pursuant to Health and Safety Code Section 34176.1 ( c)(2), if any, to another housing successor agency made in previous Fiscal Year(s), including whether the funds are unencumbered and the status of projects, if any, for which the transferred LMIHAF will be used. The sole purpose of the transfers must be for the development of transit priority projects, permanent supportive housing, housing for agricultural employees or special needs housing.
3 of 35
POWAY HOUSING SUCCESSOR ANNUAL REPORT FISCAL YEAR 2023 -2024

ATTACHMENT A
May 20, 2025, Item #4
VI.

Project
Descriptions:

This
section
describes
any
project
for
which
the
Housing
Successor
receives
or
holds
property
tax
revenue
pursuant
to
the
ROPS
and
the
status
of
that
project.

VII.

Status
of
Compliance
with
Section
33334.16:

This
section
provides
a
status
update
on
compliance
with
Section
33334.16
for
interests
in
real
property
acquired
by
the
former
redevelopment
agency
prior
to
February
1,
2012.

For
interests
in
real
property
acquired
on
or
after
February
1,
2012,
the
Housing
Successor
must
provide
a status
update
on
the
project.

The
Poway
Housing
Successor
has
acquired
two
properties
since
February
1,
2012.

VIII.

Description
of
Outstanding
Obligations
under
Section
33413:

This
section
describes
the
outstanding
inclusionary
and
replacement
housing
obligations,
if any,
under
Section 33413
that
remained
outstanding
prior
to
dissolution
of
the
former
redevelopment
agency
as
of
February
1,
2012,
along
with
the
Housing
Successor's
progress
in
meeting
those
prior
obligations,
if
any,
of
the
former
redevelopment
agency
and
how
the
Housing
Successor's
plans
to
meet
unmet
obligations,
if
any.

IX.

Income
Test:

This
section
provides
the
information
required
by
Section
34176.1
(a)(3)(B),
or
a
description
of
expenditures
by
income
restriction
for
five-year
period,
with
the
time
period
beginning
January
1,
2014,
and
whether
the
statutory
thresholds
have
been
met.

Senior
Housing
Test:

This
section
provides
the
percentage
of
units
of
deed-restricted
rental
housing restricted
to
seniors
and
assisted
individually
or
jointly
by
the
Housing
Successor,
its
former
redevelopment
Agency,
and
its
host
jurisdiction
within
the
previous
10 years
in
relation
to
the
aggregate
number
of
units
of
deed-restricted
rental
housing
assisted
individually
or
jointly
by
the
Housing
Successor,
its
former
Redevelopment
Agency
and
its
host
jurisdiction
within
the
same
time
period.

For
this
Report,
the
ten-year
period
reviewed
is
January
1,
2014
to
December
31,
2024
.

XI.

Excess
Surplus
Test:

This
section
provides
the
amount
of
excess
surplus
in
the

LMIHAF,
if any,
and
the
length
of
time
that
the
Housing
Successor
has
had
excess
surplus,
and
the
Housing
Successor's
plan
for
eliminating
the
excess
surplus.

XII.

Inventory
of
Homeownership
Units:

This
section
provides
a
summary
of
covenanted
homeownership
units
assisted
by
the
former redevelopment
agency
or
the
housing
successor
that
are
subject
to
covenants
or
restrictions
or
to
an
adopted
program
that
protects
the
former
redevelopment
agency's
investment
of
monies
from
the
Low-
and
Moderate-Income
Housing
Fund
pursuant
to
subdivision
(f)
of
Section
33334.3.

Inventory
shall
include
the
following:
a)
the
number
of
those
units;
b)
in
the
first
report
pursuant
to
this
subdivision,
the
number
of
units
lost
to
the
portfolio
after
February
1,
2012,
and
the
reason
or
reasons
for
those
losses.

For
all
subsequent
reports,
the
number
of
the
units
lost
to
the
portfolio
in
the
last
fiscal
year
and
the
reason
for
those
losses;
c)
any funds
returned
to
the
housing
successor
as
part
of
an
adopted
program
that
protects
the
former
redevelopment
agency's
investment
of
moneys
from
the
Low-
and
Moderate-Income
Housing
Fund;
and
d)
whether
the
housing
successor
has
contracted
with
any
outside
entity
for
the
management
of
the
units
and,
if
so,
the
identity
of
the
entity
.

POWAY

HOUSING

SUCCESSOR
ANNUAL
REPORT
FISCAL
YEAR
2023
-2024
4 of
35 May 20, 2025, Item #4
I. AMOUNT DEPOSITED INTO LMIHAF
A total of $284,877 was deposited into the LMIHAF during the Fiscal Year.

II. ENDING BALANCE OF LMIHAF
At the close of the Fiscal Year, the ending balance in the LMIHAF was $5,120,157 none of which is being held for items listed on the ROPS. This includes $5,205,932 in cash and investments, and $362,965 in housing loans receivable, less $37,485 in liabilities. The $296,242 is due from the Successor Agency and represents the Housing Authority's 20% of the former Redevelopment Agency's loan balance, and repayment is subject to approval by the California Department of Finance.

Ill. DESCRIPTION OF EXPENDITURES FROM LMIHAF
The following is a description of expenditures from the LMIHAF by category:

Fiscal Year 2023-24
Monitoring & Administration Expenditures $9,712
Homeless Prevention & Rapid Rehousing Expenditures $0
Housing Development Expenditures $172,191
Total LMIHAF Expenditures in Fiscal Year $181,903
IV. STATUTORY VALUE OF ASSETS OWNED BY HOUSING SUCCESSOR Under the Dissolution Law and for purposes of this Report, the "statutory value of real property" means the value of properties formerly held by the former redevelopment agency as listed on the housing asset transfer schedule approved by the Department of Finance as listed in such schedule under Section 34176(a)(2), the value of the properties transferred to the Housing Successor pursuant to Section 34181 (f), and the purchase price of properties purchased by the Housing Successor. Further, the value of loans and grants receivable are included in these reported assets held in the LMIHAF. The following provides the statutory value of assets owned by the Housing Successor:

Fiscal Year 2023-24
Cash and Cash Equivalents $5,205,932
Accounts Receivable $13,084
Statutory Value of Real Property Owned by Housing Authority $13,917,824 Value of Loans and Grants Receivable $296,242
Total Value of Housing Successor Assets $5,515,258
V. DESCRIPTION OF TRANSFERS
The Housing Successor did not make any LMIHAF transfers to other Housing Successor(s) under Section 34176.1 ( c)(2) during the Fiscal Year.

POWAY HOUSING SUCCESSOR ANNUAL REPORT FISCAL YEAR 2023 -2024 5 of 35
May 20, 2025, Item #4
VI.

PROJECT

DESCRIPTIONS
The
Housing
Successor
did
not
receive
and
did
not
hold
property
tax
revenue
pursuant
to
the
ROPS. VII.

STATUS
OF

COMPLIANCE
WITH

SECTION
33334.16
Section
34176.1
provides
that
Section
33334
.16
does
not
apply
to
interests
in
real
property
acquired
by
the
Housing
Successor
on
or
after
February
1,
2012.

With
respect
to
interests
in
real
property
acquired
by
the
former
redevelopment
agency
prior
to
February
1, 2012,
and
transferred
to
the
Successor
Agency
pursuant
to
Health
and
Safety
Code
Section
34176
,
the
time
periods
described
in
Section
33334.16
shall
be
deemed
to
have
commenced
on
the
date
that
the
Department
of
Finance
(DOF)
approved
the
property
as
a housing
asset
on
the
Housing
Asset
Transfer
Form
; thus
, as
to
real
property
acquired
by
the
former
redevelopment
agency
now
held
by
the
Housing
Successor, the
Housing
Successor
must
initiate
activities
consistent
with
the
development
of
the
real
property
for
the
purpose
for
which
it
was
. acquired
within
five
years
of
the
date
the
DOF
approved
such
property
as
a
housing
asset.

Poway's
Housing
Assets
Transfer
Form
was
approved
by
the
DOF
on
August
31,
2012
.

The
following
provides
a
status
update
on
the
real
property
housing
assets
that were
acquired
by
the
former
redevelopment
agency
prior
to
February
1,
2012,
and
transferred
to
the
Housing
Successor
on
February
1,
2012,
and
compliance
with
the
five-year
period
to
commence
development
activities
.

APN
Street
Address
Date
of
Size
Status
Purchase
27546061
1267
4 Monte
Vista
Rd
02/22/2000

2.06 Acres
An
Affordable
Housing
Agreement
and
Ground
Lease
executed
11/19/2024
.

Construction
completion
no
later
than
12/31
/27
. The
Developer
is
actively
securing
financing
and
tax
credits
.
32119028
0 Twin
Peaks
Rd
11/03/2004

2.15 Acres
Vacant
land
.
31423026
13424
Scots
Way
08/27/2002

0.70 Acres
Vacant
land
. Due
to
access
issues
, development
options
are
still
actively
being
evaluated
.
31421418
14048
Sycamore
Ave
06/30/2005

0.32 Acres
Vacant
land
. Creek
runs
through
property
. Development
options
continue
to
be
evaluated
.
31710151
Floodway
adjacent
to
08/27/2004

2.15 Acres
Vacant
land
. Property
located
in
&
52 the
Solara
Affordable
floodway
, cannot
be
developed
.

Housing
Development
The
following
provides
a
status
update
on
real
property
housing
assets
that
were
acquired
by
the
Housing
Successor
after
February
1,
2012.

POWAY
HOU
SING

SUCCESSOR
ANNUAL
REPORT
FISCA
L YEAR
2023
-2024
6 of
35 May 20, 2025, Item #4
APN
Street
Address
P~:~~::e
Size
Status
31723222
12207
&
12237
Old
01/09/2018

1.07 Acres Future
affordable
housing
site.
&36
PomeradoRoad
Funds
for
demolition
of
the
site
are
budgeted,
awaiting
City
Council/Housing
Authority
Board
approval.

VIII.

DESCRIPTION
OF

OUTSTANDING

OBLIGATIONS

PURSUANT
TO

SECTION
33413
Replacement
Housing
:

According
to
the
2010-2014
Implementation
Plan
for
the
former
redevelopment
agency,
no
Section
33413(a)
replacement
housing
obligations
were
transferred
to
the
Housing
Successor.

Furthermore
, the
Housing
Successor
has
not
caused
the
demolition
of
any
units
and
no
new
replacement
housing
obligations
have
been
created.
lnclusionary/Production
Housing
. According
to
the
2010-2014
Implementation
Plan
for
the
former
redevelopment
agency,
no
Section
33413(b)
inclusionary/production
housing
obligations
were
transferred
to
the
Housing
Successor
.

The
former
redevelopment
agency's
Implementation
Plans
are
posted
on
the
City
's
website
at
http://poway.org/207
/Affordable-Housing
.

IX.

EXTREMELY

LOW-INCOME
TEST
Section
34176.1
(a)(3)(B)
requires
that
the
Housing
Successor
must
require
at
least
30%
of
the

LMIHAF,
after
expenditures
allowed
pursuant
to
Code
section
34176.1
(a)(1)
and
(2,)
to
be
expended
for
development
of
housing
affordable
to,
and
occupied
by,
households
earning
30%
or
less
of
the
AMI.

If
the
Housing
Successor
fails
to
comply
with
the
extremely
low
income
requirement
in
any
five
year
report
beginning
with
the
five
year
report
to
be
issued
in
2019
, then
the
Housing
Successor
shall
ensure
that
at
least
50%
of
these
remaining
LMIHAF
funds
expended
in
each
fiscal
year
following
the
latest
fiscal
year
following
the
five
year
report
are
expended
for
the
development
of
rental
housing
affordable
to,
and
occupied
by
, households
earning
30%
or
less
of
the
area
AMI
until
the
housing
successor
demonstrates
compliance
with
the
extremely
low-income
requirement
in
an
annual
report.

This
information
was
required
to
be
reported
beginning
in
2019
for
the
first
5-year
period
(FY
2018/2019
through
FY
2023/2024).

Extremely
Low-Income
Expenditures
Test
July
1,
2018
through
June
30,
2024
LMIHAF
Spent
on
Extremely
Low-Income
Housing
$72,594
.51
Amount
Spent
on
ELI
Units
= A
Total
LMIHAF
Spent
in
5-Year
Period
$279,209.62
Total
LMIHAF
Spent=
B
Extremely
Low-Income
Test
26%
*
A
I B
=
Percent
of
LMIHAF
Spent
on
ELI
Units
in
5-year
period
*Expenditures
over
the
total
5-year
period
were
26%
due
to
funding
commitments
established
prior
to
testing
requirement.

However,
over
the
last
3-year
period
(2021
-2024)
expenditures
were
30%
.

SENIOR

HOUSING

TEST POWAY
HO
USING
SUCCE
SSOR
ANNUA

L REPORT
FISCA
L YEA
R
2023
-2024
7 of
35 May 20, 2025, Item #4
The Housing Successor is required to calculate the percentage of units of deed-restricted rental housing restricted to seniors and assisted by the Housing Successor, the former redevelopment agency and/or the City within the previous 10 years in relation to the aggregate number of units of deed-restricted rental housing assisted by the Housing Successor, the former redevelopment agency, and/or City within the same time period. If this percentage exceeds 50%, then the Housing Successor cannot expend future funds in the LMIHAF to assist additional senior housing units until the Housing Successor or City assists and construction has commenced on a number of restricted rental units that is equal to 50% of the total amount of deed-restricted rental units. The following provides the Housing Successor's Senior Housing Test for the 10-year period of January 1, 2013 through December 31, 2024:

Housing Test 2014-2024
# of Assisted Senior Rental Units 43
# of Total Assisted Rental Units 246
Senior Housing Percentage 17%
XI. EXCESS SURPLUS TEST
Excess Surplus is defined in Section 34176.1 (d) as an unencumbered amount in the LMIHAF account that exceeds the greater of one million dollars ($1,000,000) or the aggregate amount deposited into the LMIHAF account during the Housing Successor's preceding four Fiscal Years, whichever is greater.

The LMIHAF was created on February 1, 2012. The current uncommitted balance of $5,120,157 in the LMIHAF exceeds the sum of the annual deposits made in the preceding four fiscal years of $2,964,254. As a result, the LMIHAF has an Excess Surplus of $2,155,903, as shown below.

The following provides the Excess Surplus test for the preceding four Fiscal Years:

FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24 Total FY20-24 Beginning Balance $4,438,922 $3,434,907 $5,192,658 $5,078,830 Add: Deposits $368,684 $1,841,651 $469,042 $284,877 $2,964,254 (Less) Expenditures $ (1,372,699) $ (83,900) $ (582,870) $ (182,177) Ending Balance $3,434,907 $5,192,659 $5,078,830 $5,181,530 (Less) Commitments $ (20,928) $ (39,850) $ (51,488) $ (61,373) Closing Balance $3,413,979 $5,152,808 $5,027,342 $5,120,157 With entitlement complete on the Monte Vista site in FY24/25, funds for an evaluation and identification of affordable housing sites survey are included in the FY25/26 budget. This survey will evaluate options and priorities for support of affordable housing.

XII. HOMEOWNERSHIP UNITS
The Housing Successor is to provide an inventory of homeownership units assisted by the former redevelopment agency or the Housing Successor that are subject to covenants or restrictions or to an adopted program that protects the former redevelopment agency's investment of monies POWAY HOUSING SUCCESSOR ANNUAL REPORT FISCAL YEAR 2023 -2024 8 of 35
May 20, 2025, Item #4
from the LMIHAF pursuant to Section 33334.3(f). Inventory is as follows:

Current Inventory Number of Units
Restricted Homeownership Units as of 12/31/2024 40
Add: Restricted Homeowner Units Added by Housing Successor (January 0 1, 2024 through December 31, 2024) (Less): Restricted Homeowner Units Lost to Portfolio (January 1, 2024 0 through December 31, 2024) No inventory was lost in 2024. A total of $0 was returned to the Housing Successor as a result of the restrictions adopted to protect the former redevelopment agency's investment in LMIHAF monies and the Housing Successor did not contract with an outside entity for the management of the ownership portfolio.

POWAY HOUSING SUCCESSOR ANNUAL REPORT FISCAL YEAR 2023 -2024 9 of 35
May 20, 2025, Item #4
10 of
35 POWAY

HOUSING

AUTHORITY
(A
Component
Unit
of
the
City
of
Poway)
Financial
Statements
Year
Ended
June 30,
2024

ATTACHMENT
B
May 20, 2025, Item #4
POWAY

HOUSING

AUTHORITY
Table
of
Contents
Year
Ended
June
30,
2024
Independent
Auditor's
Report
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.....
.......
...............
........
....
.....
............
. 1
Basic
Financial
Statements
Government-Wide
Financial
Statements
Statement
of
Net
Position
................
....
......................
................
........
......
.........................
......
4 Statement
of
Activities
........
.....
....
.......................
.....
......
.....
......
....
............
.......
......
..............
...
5 Fund
Financial
Statements
Balance
Sheet
........
..........
.........................
...
...
.........................................
.....
...
...............
.........
6 Reconciliation
of
the
Balance
Sheet
of
the
Governmental
Fund
to
the
Statement
of
Net
Position
........
.....
........
....
..........................
......
....
......
...........
..............
7 Statement
of
Revenues,
Expenditures
and
Changes
in
Fund
Balance
.....................
.....
..........
8 Reconciliat
ion
of
the
Statement
of
Revenues
, Expenditures
and
Changes
in
Fund
Balance
of
the
Governmental
Fund
to
the
Statement
of
Activities
................
9 Notes
to
the
Basic
Financial
Statements......
......
........
.................
........
....
......
..............
....................
10 Required
Supplementary
Information
{Unaudited)
Budgetary
Comparison
Schedule
....
.......
.....
........
.................
.......
................
.....
....
................
...
18 Note
to
Required
Supplementary
Information
.......
....
.............
.........
.......
.............
....
....
...
.......
19 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
...........................
.....
...............................
. 21
11 of
35 May 20, 2025, Item #4
+ DavisFarr

CERTIFIED PUBLIC ACCOUNTANTS
Davis Farr LLP
18201 Von Karman Avenue I Suite 1100 I Irvine, CA 92612 Main: 949.474.2020 I Fax: 949.263.5520

INDEPENDENT AUDITOR'S REPORT
Poway Housing Authority
City of Poway
Poway, California
Report on the Audit of the Financial Statements
Opinions
We have audited the financial statements of the governmental activities and the major fund of the Poway Housing Authority (the Authority), a component unit of the City of Poway, California, as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the Authority's basic financial statements as listed in the table of contents.

In our opinion, the accompanying financial statements present fairly, in all material respects, the respective financial position of the governmental activities and the major fund of the Authority as of June 30, 2024, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.

Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Authority and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Emphasis of a Matter
As described more fully in Note 1, the basic financial statements present only the Authority and are not intended to present fairly the financial position and results of operations of the City of Poway, California in conformity with accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter.

Responsibilities of Management for the Financial Statements The Authority's management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Authority's ability to continue as a going concern for one year after the date that the financial statements are issued.
12 of 35 1
May 20, 2025, Item #4
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 GAAS 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 om1ss1ons, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with GAAS, 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 Authority'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 Authority's ability to continue as a going concern for a reasonable period of time.

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

Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Budgetary Comparison Schedule 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.
13 of 35 2
May 20, 2025, Item #4
Management has omitted management's discussion and analysis that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of the financial reporting for placing the basic financial statements in an appropriate operational, economic or historical context. Our opinions on the basic financial statements are not affected by this missing information.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 27, 2024 on our consideration of the Authority's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of 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 Authority's internal control over financial reporting and compliance.

Dcwisf°Cl.Yr LLP
Irvine, California
December 27, 2024
14 of 35 3
May 20, 2025, Item #4

BASIC FINANCIAL STATEMENTS
15 of 35
May 20, 2025, Item #4
16 of 35
ASSETS
Poway Housing Authority
Statement of Net Position
June 30, 2024
Cash and investments (Note 2)
Accounts receivable
Due from other governments
Capital assets, nondepreciable (Note 3)
Total assets

LIABILITIES
Accounts payable
Unearned revenue
Total liabilities

NET POSITION
Investment in capital assets
Restricted for:

Housing
Total net position
$
$
Governmental
Activities
5,205,932
13,084
296,242
13,917,824
19,433,082
29,694
7,791
37,485
13,917,824
5,477,773
19,395,597
See accompanying notes to the basic financial statements 4 May 20, 2025, Item #4
Functions/Programs
Governmental activities:

General government
Development services
Total governmental activities
$
$
Poway Housing Authority
Statement of Activities
Year Ended June 30, 2024
Program Revenues
Expenses
9,986
172,191
182,177
Operating
Charges Contributions
for and
Services Grants
274
274
General Revenues
Investment income
Other
Total general revenues
Change in net position
Net position, beginning
Net position, ending
Capital
Contributions
and
Grants
See accompanying notes to the basic financial statements 17 of 35 5
Net (Expense)
Revenue
and
Changes in
Net Position
(9,712)
(172,191)
(181,903)
121,397
96,483
217,880
35,977
19,359,620
$ 19,395,597
May 20, 2025, Item #4
18 of 35
ASSETS
Cash and investments
Accounts receivable
Poway Housing Authority
Balance Sheet
Governmental Fund
June 30, 2024
Due from other governments
Total assets

LIABILITIES AND FUND BALANCE
Liabilities:

Accounts payable
Unearned revenue
Total liabilities

FUND BALANCE
Restricted for housing
Total fund balances
Total liabilities and fund balance
$
$
$
$
See accompanying notes to the basic financial statements 6 5,205,932
13,084
296,242
5,515,258
29,694
7,791
37,485
5,477,773
5,477,773
5,515,258
May 20, 2025, Item #4
Poway Housing Authority
Reconciliation of the Balance Sheet of the
Governmental Fund to the Statement of Net Position
June 30, 2024
Total Governmental Fund Balance
Amounts reported for governmental activities in the Statement of Net Position were different because:

Capital assets used in governmental activities were not current financial resources and, therefore, were not reported in the funds. $ 5,477,773
13,917,824
Net position of governmental activities $ 19,395,597 ============ See accompanying notes to the basic financial statements 19 of 35 7
May 20, 2025, Item #4
20 of 35
Poway Housing Authority
Statement of Revenues, Expenditures and Changes in Fund Balance Governmental Fund
Year Ended June 30, 2024

REVENUES
Lease revenue $
Investment income
Reimbursement agreement fees
Total revenues

EXPENDITURES
Current:

General government
Development services
Total expenditures
Net change in fund balance
Fund balance, beginning of year
Fund balance, end of year $
See accompanying notes to the basic financial statements 8 274
121,397
96,483
218,154
9,986
172,191
182,177
35,977
5,441,796
5,477,773
May 20, 2025, Item #4
Poway Housing Authority
Reconciliation of the Statement of Revenues,
Expenditures and Changes in Fund Balance of the Governmental Fund to the Statement of Activities
Year Ended June 30, 2024
Net change in fund balance -total governmental fund
Change in net position of governmental activities
See accompanying notes to the basic financial statements 21 of 35 9
$ 35,977
$ 35,977
May 20, 2025, Item #4

POWAY HOUSING AUTHORITY
Notes to the Basic Financial Statements
Year Ended June 30, 2024
Note 1 -Reporting Entity and Summary of Significant Accounting Policies The accounting policies of the Poway Housing Authority (Authority} conform to accounting principles generally accepted in the United States of America as applicable to governments. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for governmental accounting and financial reporting principles. The following is a summary of the Authority's significant accounting policies:

A. Description of Reporting Entity
On March 1, 2011, the City Council of the City of Poway declared a need for a housing authority in the City of Poway and adopted a resolution forming the Poway Housing Authority. The creation of the Housing Authority provides the City legal authority to continue monitoring ongoing rent and income compliance at affordable housing developments.

The former Poway Redevelopment Agency (Agency) and the Authority prepared a Cooperation Agreement to provide for implementation of certain low-and moderate-income housing projects and to make payments by the Agency to the Authority for the costs to the Authority for performing its obligations. The Agency was dissolved due to the passage of Assembly Bill Xl 26 which became effective on October 1, 2011. In accordance with Health and Safety code 34175(b}, on February 1, 2012, all housing assets, liabilities and fund balance of the Agency were transferred to the Authority as the Successor Agency to the Poway Redevelopment Agency.

The Authority meets the criteria set forth in U.S. GAAP for inclusion as a blended component unit within the City reporting entity based on the City's oversight responsibility in selection of the governing board.

In addition, all of the Authority's activities are conducted within the geographic boundaries of the City.

Blended component units, although legally separate entities, are, in substance, part of the City's operations; therefore, data from these units are combined with data of the primary government in the financial statement presentation of the City. Only the funds of the Authority are included herein; therefore, these financial statements do not purport to represent the financial position or results of operations of the City.

B. Basis of Accounting/Measurement Focus
The accounts of the Authority are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, deferred outflows of resources, liabilities, deferred inflows of resources, fund equity, revenues, and expenditures or expenses, as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. 22 of 35 10
May 20, 2025, Item #4

POWAY HOUSING AUTHORITY
Notes to the Basic Financial Statements
Year Ended June 30, 2024
Note 1-Reporting Entity and Summary of Significant Accounting Policies (Continued) Government-Wide Financial Statements
The Authority's Government-Wide Financial Statements include a Statement of Net Position and a Statement of Activities. These statements present summaries of governmental activities for the Authority.

These basic financial statements are presented on an "economic resources" measurement focus and the accrual basis of accounting. Accordingly, all of the Authority's assets and liabilities, including capital assets, as well as infrastructure assets, and long-term liabilities, are included in the accompanying Statement of Net Position. The Statement of Activities presents changes in net position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred.

Certain types of transactions are reported as program revenues for the Authority in three categories:
• Charges for services
• Operating grants and contributions
• Capital grants and contributions
Governmental Fund Financial Statements
Governmental fund financial statements include a Balance Sheet and a Statement of Revenues, Expenditures and Changes in Fund Balances for the governmental fund. An accompanying schedule is presented to reconcile and explain the differences in fund balance as presented in these statements to the net position presented in the Government-Wide Financial Statements.

All governmental funds are accounted for on a spending or "current financial resources" measurement focus and the modified accrual basis of accounting. Accordingly, only current assets and current liabilities are included on the Balance Sheet. The Statement of Revenues, Expenditures and Changes in Fund Balance presents increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Under modified accrual basis of accounting, revenues are recognized in the accounting period in which they become both measurable and available to finance expenditures of the current period.

Revenues are recorded when received in cash, except that revenues subject to accrual (generally 60 days after year-end) are recognized when due. The primary revenue sources, which have been treated as susceptible to accrual by the Authority, are property tax, and intergovernmental revenues. Expenditures are recorded in the accounting period in which the related fund liability is incurred. 23 of 35 11
May 20, 2025, Item #4

POWAY HOUSING AUTHORITY
Notes to the Basic Financial Statements
Year Ended June 30, 2024
Note 1-Reporting Entity and Summary of Significant Accounting Policies (Continued) The Reconciliation of the Fund Financial Statements to the Government-Wide Financial Statements is provided to explain the differences created by the integrated approach of generally accepted accounting principles.

Fund Accounting
The Authority uses funds to maintain its financial records during the year. A fund is defined as a fiscal and accounting entity with a self-balancing set of accounts. The Authority only has one governmental fund.

Governmental Fund
Housing Authority Fund -The Housing Authority Fund is the Authority's operating fund. It accounts for all financial resources of the Authority.

C. Cash and Investments
The Authority's cash and investment balances are included in the City's investment pool. The City pools cash resources from all City funds in order to facilitate the management of cash and achieve the goal of obtaining the highest yield with the greatest safety and least risk. The balance in the pooled cash account is available to meet current operating requirements. Cash in excess of current requirements is invested in various interest-bearing accounts and other investments for varying terms. Investments are stated at fair value. Market value is used as fair value for those securities for which market quotations are readily available.

The City participates in an investment pool managed by the State of California titled Local Agency Investment Fund ("LAIF") which has invested a portion of the pool funds in structured notes and asset backed securities. LAIF determines fair value on its investment portfolio based on market quotations for those securities where market quotations are readily available and based on amortized cost or best estimate for those securities where market value is not readily available. LAIF investments are subject to credit risk with the full faith and credit of the State of California collateralizing these investments. In addition, these investments are subject to market risk and changes in interest rates.

Cash equivalents are considered amounts in demand deposits and short-term investments with a maturity date within three months of the date acquired by the Authority and are presented as "Cash and investments" in the accompanying basic financial statements. 24 of35 12
May 20, 2025, Item #4
POWAY

HOUSING

AUTHORITY
Notes
to
the
Basic
Financial
Statements
Year
Ended
June
30,
2024
Note
1-
Reporting
Entity
and
Summary
of
Significant
Accounting
Policies
{Continued)
D.

Capital
Assets
Capital
assets,
which
include
property,
plant,
equipment
and
infrastructure
assets
(e
.g.,
roads,
streets,
sidewalks,
medians
and
storm
drains)
are
reported
in
the
Government-Wide
Financial
Statements
.

Authority
policy
has
set
the
capitalization
threshold
for
reporting
capital
assets
at
$5,000.

Capital
assets
are
valued
at
historical
cost
or
estimated
historical
cost
if
actual
historical
cost
was
not
available
. Donated
assets
are
valued
at
their
estimated
acquisition
value
on
the
date
donated.

Depreciation
is
recorded
on
a straight-line
basis
over
estimated
useful
lives
of
the
assets
as
follows:

Buildings Building
improvements
Furniture
and
equipment
Infrastructure
E.

Deferred
Outflows/In/lows
of
Resources
10-50
years
10-
100
years
5-20
years
20-50
years
In
addition
to
assets,
the
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
assets
that
applies
to
future
periods
and
so
will
not
be
recognized
as
an
outflow
of
resources
(expenditure)
until
then.

The
Authority
currently
has
no
items
that
qualify
for
reporting
in
this
category. In
addition
to
liabilities,
the
balance
sheet
will
sometimes
report
a
separate
section
for
deferred
inflows
of
resources.

This
separate
financial
element,
deferred
inflows
of
resources,
represents
an
acquisition
of
net
assets
that
applies
to
future
periods
and
so
will
not
be
recognized
as
an
inflow
of
resources
(revenue)
until
that
time.

The
Authority
currently
has
no
items
that
qualify
for
reporting
in
this
category.

Unearned
Revenue
Unearned
revenues
arise
when
the
government
receives
resources
before
it
has
a
legal
claim
to
them,
as
when
grant
monies
are
received
prior
to
incurring
qualifying
expenditures.

In
subsequent
periods
when
both
revenue
recognition
criteria
are
met
or
when
the
government
has
a legal
claim
to
the
resources,
the
unearned
revenue
is
removed
from
the
balance
sheet
and
revenue
is
recognized
.
25 of
35 13
May 20, 2025, Item #4
POWAY

HOUSING

AUTHORITY
Notes
to
the
Basic
Financial
Statements
Year
Ended
June
30,
2024
Note
1 -
Reporting
Entity
and
Summary
of
Significant
Accounting
Policies
(Continued)
G.

Net
Position
Net
position
is
comprised
of
the
various
net
earnings
from
operating
income,
non-operating
revenues
and
expenses.

Net
position
is
classified
in
the
following
categories:

Net
Investment
in
Capital
Assets
-
This
component
of
net
position
consists
of
capital
assets,
net
of
accumulated
depreciation,
reduced
by
the
outstanding
balances
of
debt
that
are
attributable
to
the
acquisition,
construction,
or
improvement
of
those
assets.

Restricted
-
This
component
of
net
position
consists
of
restricted
assets
and
deferred
outflows
of
resources
reduced
by
liabilities
and
deferred
inflows
of
resources
related
to
those
assets.

Unrestricted
-
This
component
of
net
position
is
the
amount
of
the
assets,
deferred
outflows
of
resources,
liabilities,
and
deferred
inflows
of
resources
that
are
not
included
in
the
determination
of
net
investment
in
capital
assets
or
the
restricted
component
of
net
position
.

When
an
expense
is
incurred
for
purposes
for
which
both
restricted
and
unrestricted
net
position
are
available,
the
Authority's
policy
is
to
apply
restricted
net
position
first.

Fund
Balances
In
the
governmental
fund
financial
statements,
fund
balances
are
classified
in
the
following
categories:

Nonspendable
-
Nonspendable
fund
balances
are
items
that
cannot
be
spent
because
they
are
not
in
spendable
form,
such
as
prepaid
items
and
inventories,
items
that
are
legally
or
contractually
required
to
be
maintained
intact,
such
as
principal
of
an
endowment
or
revolving
loan
funds
.

Restricted
-
Restricted
fund
balances
encompass
the
portion
of
net
fund
resources
subject
to
externally
enforceable
legal
restrictions.

This
includes
externally imposed
restrictions
by
creditors,
such
as
through
debt
covenants,
grantors,
contributions,
laws
or
regulations
of
other
governments,
as
well
as
restrictions
imposed
by
law
through
constitutional
provisions
or
enabling
legislation
.

Committed
-
Committed
fund
balances
encompass
the
portion
of
net
fund
resources,
the
use
of
which
is
constrained
by
limitations
that
the
government
imposes
upon
itself
at
its
highest level
of
decision
making,
normally
the
governing
body
through
council
resolutions,
etc.,
and
that
remain
binding
unless
removed
in
the
same
manner.

The
Board
of
Commissioners
is
considered
the
highest
authority
for
the
Authority
.

Assigned
-
Assigned
fund
balances
encompass
the
portion
of
net
fund
resources
reflecting
the
government's
intended
use
of
resources.

Assignment
of
resources
can
be
done
by
the
highest
level
of
decision
making
or
by
a
committee
or
official
designated
for
that
purpose.

The
Board
of
Commissioners
has
authorized
the
Executive
Director
for
that
purpose
.
26 of
35 14
May 20, 2025, Item #4
POWAY

HOUSING

AUTHORITY
Notes
to
the
Basic
Financial
Statements
Year
Ended
June
30,
2024
Note
1-
Reporting
Entity
and
Summary
of
Significant
Accounting
Policies
(Continued)
H.

Fund
Balances
(Continued}
Unassigned
-
This
category
is
for
any
remaining
balances
that
are
not
classified
as
nonspendable,
restricted,
committed
or
assigned.

When
expenditures
are
incurred
for
purposes
for
which
both
restricted
and
unrestr
icted
fund
balances
are
available,
the
Authority's
policy
is
to
apply
restricted
fund
balances
first,
then
unrestricted
fund
balances
as
they
are
needed
.

When
expenditures
are
incurred
for
purposes
where
only
unrestricted
fund
balances
are
available,
the
Authority
uses
the
unrestricted
resources
in
the
following
order:
committed,
assigned,
and
unassigned
.

Estimates
The
preparation
of
financial
statements
in
conformity
with
U.S
. GAAP
requires
management
to
make
estimates
and
assumptions
that
affect
certain
reported
amounts
and
disclosures.

Accordingly,
actual
results
could
differ
from
those
estimates.

Note
2 -
Cash
and
Investments
Equity
in
Cash
and
Investment
Pool
of
the
City
of
Poway
The
Authority
does
not
have
a
separate
bank
account;
however,
the
Authority's
cash
and
investments
are
maintained
in
an
investment
pool
managed
by
the
City
.

The
Authority
is
a
voluntary
participant
in
that
pool.

This
pool
is
governed
by
and
under
the
regulatory
oversight
of
the
Investment
Policy
adopted
by
the
City
Council
of
the
City
.

The
Authority
has
not
adopted
an
investment
policy
separate
from
that
of
the
City
.

Note
2 -
Cash
and
Investments
(Continued)
The
fair
value
of
the
Authority's
investment
in
this
pool
is
reported
in
the
accompanying
financial
statements
at
amounts
based
upon
the
Authority's
pro-rata
share
of
the
fair
value
calculated
by
the
City
for
the
entire
City
portfolio
. The
balance
available
for
withdrawal
is
based
on
the
accounting
records
maintained
by
the
City,
which
are
recorded
on
an
original
cost
basis
.

At
June
30,
2024,
the
Authority
had
a
cash
balance
of
$5,205,932
.
27 of
35 15
May 20, 2025, Item #4
Note 3 -Capital Assets

POWAY HOUSING AUTHORITY
Notes to the Basic Financial Statements
Year Ended June 30, 2024
The summary of changes in capital assets for the year ended June 30, 2024 is as follows:

Capital assets, not being
depreciated:

Land
Total capital assets, not being
depreciated
Governmental activities -capital
assets
Note 4 -Related Party Transactions
Balance
June 30, 2023
$ 13,917,824
13,917,824
$ 13,917,824
Additions Deletions
Balance
June 30, 2024
13,917,824
13,917,824
13,917,824
In an effort to ensure that the objectives of Poway's Redevelopment Plan and the Poway Redevelopment Agency's (Agency) 5-Year Implementation Plan are fulfilled, on March 11, 2011, the Agency transferred all housing-related assets to the Authority through a Cooperation Agreement between the Agency and the Authority. Under the terms of this agreement, the Authority agreed to respectively carry out the projects and activities of the Agency in accordance with the objectives and purposes included in the Redevelopment and Implementation Plans. Projects included in the Cooperation Agreement between the Agency and the Authority further the goals of the Redevelopment Plan. It was initially anticipated that these projects would be funded based on available tax increment to be received through 2037, but because of the dissolution of the Agency under AB Xl 26, tax increment revenue has been eliminated, and therefore, no funding for these projects from that source is available.

Future project funding will come from the management of the Authority's assets and may include interest revenue, lease revenue, residual receipt revenue and the sale of assets.

Note 5 -Rehabilitation Loan Program
Housing Rehabilitation Loan Program
There are two types of housing rehabilitation loan. Forgivable rehabilitation loans are forgiven at a rate of 10% per year given all loan covenants are met. Non-forgivable loans are due upon the sale, transfer or foreclosure of the property. Due to the contingent nature of the repayment schedule of these loans, there is an allowance recorded at 100% of the outstanding balance. The balance of the non-forgivable rehabilitation loans at June 30, 2024 is $7,870.
28 of 35 16
May 20, 2025, Item #4
POWAY

HOUSING

AUTHORITY
Notes
to
the
Basic
Financial
Statements
Year
Ended
June
30,
2024
Note
5 -
Rehabilitation
Loan
Program
(Continued)
Affordable
Housing
Loans
These
loans
are
made
to
aid
in
the
purchase
of
affordable
housing
in
the
City
of
Poway
. They
are
for
a
45-year
term
with
interest
between
2 percent
and
3 percent
and
if
there
is
a sale,
transfer
or
foreclosure
before
the
end
of
the
term
the
loan
must
be
assumed
by
an
income
qualified
buyer
and
the
45-year
term
starts
over
. Due
to
the
contingent
nature
of
the
repayment
schedule
of
these
loans,
there
is
an
allowance
recorded
at
100%
of
the
outstanding
balance.

The
balance
of
these
Affordable
Housing
loans
at
June
30,
2024
is
$2,117,287.

Development
Loans
The
City,
through
the
Housing
Authority,
has
development
loans
primarily
for
affordable
rental
housing
projects
and
for
one
group
home
for
the
developmentally
disabled.

The
. affordable
rental
housing
loans
have
55-year
to
57-year
terms
with
three
percent
simple
interest.

Loan
payments
are
made
from
residual
receipts
and
generally
do
not
cover
the
annual
accrued
interest.

Therefore,
due
to
the
contingent
nature
of
the
repayment
schedule
of
these
loans,
there
is
an
allowance
recorded
at
100%
of
the
outstanding
balance.

The
balance
of
the
development
loans,
including
accrued
interest,
at
June
30,
2024
is
$41,839,812.
29 of
35 17
May 20, 2025, Item #4

REQUIRED SUPPLEMENTARY INFORMATION
30 of 35
May 20, 2025, Item #4

REVENUES
Lease revenue
Investment income
Reimbursement agreement fees
Total revenues

EXPENDITURES
Current:

General government
Development services
Total expenditures
Excess (deficiency) of revenues
over (under) expenditures
Net change in fund balance
Fund balance, beginning of year
Fund balance, end of year
31 of 35
$
$

POWAY HOUSING AUTHORITY
Budgetary Comparison Schedule
Year Ended June 30, 2024
Budget Amounts
Original Final
7 7
53,080 53,080
40,000 40,000
93,087 93,087
106,400 106,400
55,300 237,509
161,700 343,909
(68,613) (250,822)
(68,613) (250,822)
See note to required supplementary information
18 Actual Variance with
Amounts Final Budget
274 267
121,397 68,317
96,483 56,483
218,154 125,067
9,986 96,414
172,191 65,318
182,177 161,732
35,977 286,799
35,977 286,799
5,441,796
$ 5,477,773
May 20, 2025, Item #4
POWAY

HOUSING

AUTHORITY
Note
to
Required
Supplementary
Information
Year
Ended
June
30,
2024
Note
1-
Budgetary
Information
The
Authority
adopts
an
annual
budget
prepared
on
the
modified
accrual
basis
for
its
major
fund
. The
Executive
Director
is
required
to
prepare
and
submit
to
the
Authority's
Board
of
Commissioners
the
annual
budget
of
the
Authority
and
administer
it
after
adoption.

Any
revisions
that
alter
the
total
appropriations
of
any
fund
must
be
approved
by
the
Board
of
Commissioners.

Prior
year
appropriations
lapse
unless
they
are
encumbered
at
year-end
or
re-appropriated
through
the
formal
budget
process
.

For
the
major
fund,
total
expenditures
may
not
legally
exceed
total
appropriations. Budget
information
is
presented
for
the
major
fund
on
a
basis
consistent
with
generally
accepted
accounting
principles
.

Budgeted
revenue
and
expenditure
amounts
represent
the
original
budget
modified
for
adjustments
during
the
year
.
32 of
35 19
May 20, 2025, Item #4
This
page
intentionally
left
blank
33 of
35 20
May 20, 2025, Item #4
Davis
Farr
LLP
18201
Von
Karman
Ave
nu
e
I Suit
e
1100
I Irvin
e,
CA
92612
Main
: 949.474
.2020
I Fa
x: 94

9.26 3.5520
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
Poway
Housing
Authority
City
of
Poway
Poway,
California

INDEPENDENT

AUDITOR'S
REPORT
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
financial
statements
of
the
governmental
activities,
and
the
major
fund
of
the
Housing
Authority
of
the
City
of
Poway
(Authority),
a
component
unit
of
the
City
of
Poway
(City),
as
of
and
for
the
year
ended
June
30,
2024,
and
the
related
notes
to
the
financial
statements,
which
collectively
comprise
the
Authority's
basic
financial
statements,
and
have
issued
our
report
thereon
dated
December
27,
2024.

Report
on
Internal
Control
Over
Financial
Reporting
In
planning
and
performing
our
audit
of
the
financial
statements,
we
considered
the
Authority's
internal
control
over
financial
reporting
(internal
control)
as
a
basis
for
designing
the
audit
procedures
that
are
appropriate
in
the
circumstances
for
the
purpose
of
expressing
our
opinion
on
the
financial
statements,
but
not
for
the
purpose
of
expressing
an
opinion
on
the
effectiveness
of
the
Authority's
internal
control.

Accordingly,
we
do
not
express
an
opinion
on
the
effectiveness
of
the
Authority's
internal
control.

A
deficiency
in
internal
control
exists
when
the
design
or
operation
of
a
control
does
not
allow
management
or
employees,
in
the
normal
course
of
performing
their
assigned
functions,
to
prevent,
or
detect
and
correct,
misstatements
on
a
timely
basis.

A
material
weakness
is
a
deficiency,
or
a
combination
of
deficiencies,
in
internal
control,
such
that
there
is
a
reasonable
possibility
that
a
material
misstatement
of
the
entity's
financial
statements
will
not
be
prevented
or
detected
and
corrected
on
a
timely
basis.

A
significant
deficiency
is
a
deficiency,
or
a
combination
of
deficiencies,
in
internal
control
that
is
less
severe
than
a
material
weakness,
yet
important
enough
to
merit
attention
by
those
charged
with
governance.

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

Given
these
limitations,
during
our
audit
we
did
not
identify
any
deficiencies
in
internal
control
that
we
consider
to
be
material
weaknesses.

However,
material
weaknesses
or
significant
deficiencies
may
exist
that
have
not
been
identified.
34 of
35 21
May 20, 2025, Item #4
Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Authority'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 financial statements. 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 or other matters that are required to be reported under Government Auditing Standards.

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

Irvine, California
December 27, 2024
35 of 35 22

Poway City CouncilMay 20, 2025

Poway City Council
May 20, 2025