CITY OF REDONDO BEACH, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
For The Year Ended
June 30, 2023
Prepared by:
Financial Services Department
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CITY OF REDONDO BEACH
ANNUAL COMPREHENSIVE FINANCIAL REPORT
For The Year Ended June 30, 2023
Table of Contents
Page(s)
INTRODUCTORY SECTION
Letter of Transmittal ......................................................................................................................................................
List of Principal Officials ...............................................................................................................................................
Organizational Chart .....................................................................................................................................................
FINANCIAL SECTION
Independent Auditors’ Report .......................................................................................................................................
Management's Discussion and Analysis ......................................................................................................................
BASIC FINANCIAL STATEMENTS
Government-Wide Financial Statements
Statement of Net Position ................................................................................................................................
Statement of Activities .....................................................................................................................................
Fund Financial Statements
Balance Sheet – Governmental Funds ...........................................................................................................
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position ......................................................................................................................
Statement of Revenues, Expenditures, and Changes in Fund Balances – Governmental Funds .......................................................................................................................................
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities ...........................................................
Statement of Net Position – Proprietary Funds ...............................................................................................
Statement of Revenues, Expenses, and Changes in Net
Position – Proprietary Funds ...........................................................................................................................
Statement of Cash Flows – Proprietary Funds ................................................................................................
Statement of Fiduciary Net Position – Fiduciary Funds ..................................................................................
Statement of Changes in Fiduciary Net Position – Fiduciary Funds ...............................................................
Notes to Basic Financial Statements ..................................................................................................................
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CITY OF REDONDO BEACH
ANNUAL COMPREHENSIVE FINANCIAL REPORT
For The Year Ended June 30, 2023
Table of Contents
Page(s)
REQUIRED SUPPLEMENTARY INFORMATION
Notes to Required Supplementary Information ..................................................................................................
Budgetary Comparison Information:
Budgetary Comparison Schedule – General Fund ........................................................................................
Budgetary Comparison Schedule – Other Intergovernmental Grants ...........................................................
Budgetary Comparison Schedule – Low-Mod Income Housing ....................................................................
Pension Information:
Schedule of Changes in Net Pension Liability and Related Ratios - Miscellaneous Plan – Agent Multiple-Employer Plan .................................................................................
Schedule of Plan Contributions – Miscellaneous Plan -
Agent Multiple-Employer Plan.....................................................................................................................
Schedule of Changes in Net Pension Liability and Related Ratios - Safety Plan – Agent Multiple-Employer Plan ..............................................................................................
Schedule of Plan Contributions - Safety Plan -
Agent Multiple-Employer Plan.....................................................................................................................
OPEB Information:
Schedule of Changes in Net OPEB Liability and Related Ratios ..................................................................
Schedule of Contributions ..............................................................................................................................
Modified Approach for City Streets Infrastructure Capital Assets ......................................................................
COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES
Combining Balance Sheet – Non-Major Governmental Funds ..........................................................................
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances – Non-Major Governmental Funds ............................................................................................
Budgetary Comparison Schedules - Special Revenue Funds:
State Gas Tax ..................................................................................................................................................
Parks and Recreation Facilities .......................................................................................................................
Narcotic Seizure / Forfeiture ...........................................................................................................................
Proposition A ...................................................................................................................................................
Proposition C ...................................................................................................................................................
Measure R .......................................................................................................................................................
Local Transportation Article 3 ..........................................................................................................................
Air Quality Improvement ..................................................................................................................................
Storm Drain Improvement ...............................................................................................................................
Street Landscaping and Lighting District .........................................................................................................
Community Development Block Grant ............................................................................................................
Disaster Recovery ...........................................................................................................................................
Housing Authority ............................................................................................................................................
Subdivision Park Trust .....................................................................................................................................
Measure M .......................................................................................................................................................
Measure W ......................................................................................................................................................
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CITY OF REDONDO BEACH
ANNUAL COMPREHENSIVE FINANCIAL REPORT
For The Year Ended June 30, 2023
Table of Contents
Page(s)
Budgetary Comparison Schedules – Capital Project Funds:
Capital Improvement Projects .........................................................................................................................
Major Facilities .................................................................................................................................................
Open Space Acquisition ..................................................................................................................................
Budgetary Comparison Schedules – Debt Service Funds:
Public Financing Authority ...............................................................................................................................
Combining Statement of Net Position – Non-Major Enterprise Funds ...............................................................
Combining Statement of Revenues, Expenses and Changes in Fund Net Position – Non-Major Enterprise Funds ..............................................................................................
Combining Statement of Cash Flows – Non-Major Enterprise Funds ................................................................
Combining Statement of Net Position – Internal Service Funds ........................................................................
Combining Statement of Revenues, Expenses and Changes in Fund Net Position – Internal Service Funds .......................................................................................................
Combining Statement of Cash Flows – Internal Service Funds .........................................................................
STATISTICAL SECTION
Net Position by Component ................................................................................................................................
Changes in Net Position .....................................................................................................................................
Fund Balances of Governmental Funds .............................................................................................................
Changes in Fund Balances of Governmental Funds ..........................................................................................
Assessed Value and Estimated Actual Value of Taxable Property ....................................................................
Direct and Overlapping Property Tax Rates .......................................................................................................
Principal Property Taxpayers ..............................................................................................................................
Property Tax Levies and Collections ..................................................................................................................
Ratios of Outstanding Debt by Type ..................................................................................................................
Direct and Overlapping Governmental Activities Debt .......................................................................................
Legal Debt Margin Information ..........................................................................................................................
Pledged - Revenue Coverage ...........................................................................................................................
Demographic and Economic Statistics ..............................................................................................................
Principal Employers ............................................................................................................................................
Full - Time City Government Employees by Function .......................................................................................
Operating Indicators by Function .......................................................................................................................
Capital Asset Statistics by Function ....................................................................................................................
Redondo Beach Public Financing Authority, Wastewater System Financing Project:
Certification of Continuing Disclosure .................................................................................................................
Sewer Rates per Month ......................................................................................................................................
Top Ten Customers – Sewage Usage ...............................................................................................................
Sewer Connections by Type of Customer ..........................................................................................................
DRAFT
CITY OF REDONDO BEACH
ANNUAL COMPREHENSIVE FINANCIAL REPORT
For The Year Ended June 30, 2023
Table of Contents
Page(s)
Redondo Beach Community Financing Authority; Leaseback Agreement:
Certification of Continuing Disclosure .................................................................................................................
Independent Auditors’ 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 ...................................................................................................
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INTRODUCTORY SECTION
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Financial Services 415 Diamond Street, P.O. Box 270
Redondo Beach, California 90277-0270
www.redondo.org
tel 310 318-0683
fax 310937-6666
redondo
B E A C H
February 28, 2024
Honorable Mayor, City Council and
Residents of the City of Redondo Beach:
Typically, we deliver the Annual Comprehensive Financial Report (ACFR) by the second Council meeting in December of each year. The FY 2022-23 ACFR was delayed as a result of new requirements associated with Government Accounting Standards Board (GASB) 96 reporting for subscription-based information technology arrangements (SBITAs) but is now complete and ready for presentation on behalf of the City, for the fiscal year ended June 30, 2023. These financial statements are presented in conformance with generally accepted accounting principles (GAAP) and audited by an independent firm of licensed certified public accountants in accordance with generally accepted auditing standards.
As per the City Charter, the role of the ACFR is to inform the Mayor and City Council of all financial and administrative activities of the previousfiscal year. This report also informs the residents of Redondo Beach and the larger financial community. For the residents, the report provides an opportunity to correlate City services and accomplishments with the expenditure of financial resources. For the financial community, this report provides information necessary to evaluate financial practices of the City, assure their soundness in accordance with GAAP, and determine the financial capacity of the City to incur and service debt for long-range capital planning.
Responsibility for the accuracy of the data presented and the completeness and fairness of the presentation, including disclosures, rests with the City. Consequently, management assumes full responsibility for the completeness and reliability of all information presented in this report. To provide a reasonable basis for making these representations, management of the City has established a comprehensive internal control framework that is designed to protect the City's assets from loss, theft or misuse and to compile sufficient reliable information for the preparation of the City's financial statements in conformance with GAAP. Because the cost of internal controls should not outweigh the benefits, the City's comprehensive framework of internal controls has been designed to provide reasonable, rather than absolute assurance that the financial statements will be free from material misstatement. As management, we assert that, to the best of our knowledge and belief, this financial report is complete and reliable in all material respects. GAAP requires that management provide a narrative introduction, i.e., overview and analysis to accompany the basic financial statements in the form of Management's Discussion and Analysis (MD&A). This letter of transmittal complements the MD&A and should be read together. The City's MD&A can be found immediately following the report of the independent auditors in the financial section of the ACFR.
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PROFILE OF THE CITY OF REDONDO BEACH
The Ci$ of Redondo Beach, incorporated in 1892, is located in the South Bay region of Los Angeles County and spans 6.3 square miles. The City of Redondo Beach has a population of approximately 68,918 per the latest census and remains a highly residential, non-industrial community. The City is highly educated and largely upscale, with a median home cost of $1,410,000, per HdL.
Redondo Beach has significant concentrations of employment in the northern portion of the City anchored by Northrop Grumman. lt also maintains strong retail centers at the South Bay Galleria, on the east end of the City, a vibrant hospitality sector near the Harbor/Pier area, and an eclectic mix of specialty shops, restaurants and services in the Riviera Village, at the south end of the City. Based on the number of fulltime employees, the top ten employers in Redondo Beach are Northrop Grumman, Redondo Beach Unified School District, City of Redondo Beach, The Cheesecake Factory, City of Redondo Beach, United States Postal Service, Prime Now LLC, Target Stores, Macy's, Frontier, and Silverado Beach Gities.
The Ci$ is divided into five Council Districts and operates under a Council-Manager form of government.
One councilperson is elected from each district and serves a term of four years, with a limit of two full terms.
The Mayor is elected by the City at-large and is also limited to serving two four-year terms. Other elected officials are the City Treasurer, City Aftorney, and City Clerk. Each of these elected offices serves a term of four years, but differ from the Mayor and City Council in that individuals can be re-elected an unlimited number of times. The City Council is responsible for City policy, including passing Municipal Code Ordinances, adopting the budget, and appointing the City Manager along with various other Board, Commission, and Committee members.
ln addition to serving as the governing board of the City, the Mayor and City Council act as the Board of Directors for various component units of the Ci$, including: the Redondo Beach Housing Authority, the Redondo Beach Public Financing Authority, the Redondo Beach Gommunity Financing Authority, the Parking Authority of the City of Redondo Beach, and the RedevelopmenUsuccessor Agency of the City of Redondo Beach. The City Manager is responsible for carrying out the policies and ordinances of the Cig Council and for selecting the non-elected heads of the City's various departments. ln May 2008, the Mayor and City Council established an audit commiftee to enhance the City's communication with its independent accounting firm, ensuring increased involvement by the governing board in the City's accounting processes.
Also, in September 2015, the Ci$ Council adopted a resolution to expand the membership-of the audit committee to include the elected city clerk and the elected city Treasurer.
The City is classified as a full-service City, providing public safety through its Police and Fire Departments, along with a host of other services, including recreation and community services, libraries, parks, maintenance and improvement of streets and infrastructure, planning and zoning, housing, economic development, transit, and general government services. The City also operates and haintains a recreational harbor under a trust agreement with the state of california.
The annual budget serves as the foundation for the City's fiscal plan and policy prioritization. The City Council is required to adopt an annual budget on or before June 30 of each year for the General Fund, Special Revenue Funds, Enterprise Funds, Capital Projects Fund, and lnternal Service Funds. The City also adopts a five-year capital improvement program and a RedevelopmenUsuccessor Agency budget.
The total adopted budget represents the level of appropriated budgetary control, which is defined as the total budget for all funds and divisions, and all revisions and amendments approved by the City Council subsequent to the initial budget adoption. The City Manager may authorize transfers within each-fund and between line items or programs within each department, however, supplemental appropriations and transfers between funds or departments during the budget year must be approved wiin four affirmative votes of the City Council. Unexpended or unencumbered appropriations expire at the end of each fiscal year. Encumbered appropriations and appropriations related to grants and donations are re-appropriated in the ensuing year's budget by action of the City Council. The Cig utilizes an encumbrance system, whereby commitments, such as purchase orders and unperformed contracts, are recorded as asiigneo fund balances at year end.
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Significant Evenh, Accomplishmenb and Economic Development Activities Over time, Redondo Beach has remained fiscally sound through proactive management, disciplined oversight of expenditures, development of a diversified revenue base, and optimizing public/private partnerships that reduce Cig costs, creating new public amenities and increasing revenues. These financial practices have enabled the City to maintain healthy capital and operating funding reserves and achieve an Aa1 credit rating. During FY 2020-21, the COVID-19 pandemic created an unprecedented fiscal management challenge as two of the City's primary sources of revenue - sales taxes and transient occupancy taxes - were severely threatened by limited business operations. Both sales tax and transit occupancy tax continued to recover significantly in FY 2022-23.
For most of FY 2022-23, the Gity's economic development efforts focused on strengthening and supporting the three commercial zones within the City - the Artesia/Aviation Commercial Corridor (inclusive of the South Bay Social District (Galleria), the Riviera Village Business District, and the Redondo Beach Waterfront.
\Mthin the Riviera Village Business District, the City worked with the Riviera Village Association to continue the success of the "parklet" program, which provided outdoor space for local business to operate under state mandated restrictions, but continues to bring additional life and commercial activity to this already vibrant area. \Mrile originally envisioned as temporary outdoor dining locations, parklets have been approved to operate until July 1 of 2026 due to the State's extension of the emergency order that allowed the creation and led to their popularity and ongoing success in the communi$. \Mthin the Waterfront, the City continued the storefront improvement program for businesses located along tnternational Boardwalk. Grant funding, ranging from $2,500 to $50,000, is available to support improvements/upgrades to storefronts and facades. The program aims to encourage private investment in the lnternationat Boardwalk commercial corridor; enhance the appearance of the storefronts, and reduce vacancies. ln addition, as part of a long-term planning effort within King Harbor, the City has completed the process of preparing a Public Amenities Plan that identifies more than 40 projects to improve upon the i:ublic amenities offered to waterfront visitors. Key projects include constructing a new public boat launch, ienovating Seaside Lagoon, improving pedestrian and bicycle connections, and many improvements to accommodate for Sea [evel Rise among others. The plan represents a financial commitment from the City to improve the existing building/infrastructure inventory for the commercial businesses located in the harbor.
The City has been making significant progress in making the Waterfront a welcoming destination. The City succesifully hosts two Beach Life concert festivals each year which bring tens of thousands of people to the area. The Waterfront also saw the removal of the closed sport fishing pier as well as the initial development of the California Surf Club in the former Ruby's and On The Rocks lease areas. The project unites local luminaries, and creates fully revamped spaces connected by outdoor additions to make a 21,OOO square feet facility, with a bar and restaurant, private conference rooms, private dining rooms, fireside ocean lounges, a great room, private listening and art rooms, a games den and more.
The City continues to work on revitalization efforts within the Artesia and Aviation commercial corridors.
Specifiially, City staff prepared municipal code text amendments to adjust development standards with the intent to reducevacancies, encourage preferred uses such as restaurants and office space to locate within the area, and allow for larger buildings on each property. Relaxing minimum parking requirements and increasing the maximum allowed floor area ratio development is expected to encourage future development. As an example of the City's revitalization efforts along Artesia Boulevard, the GrubHaus, located on Artesia Blvd & Mackay Lane has been approved for development, and will include an 8,000 square-foot property that will house outdoor multi-unit micro-kitchens and other food options for the Redondo Beach community to enjoY.
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The City Councilapproved the redevelopment of the South Bay Galleria Mall(South Bay Social District) on the Artesia Corridor as a mixed-use project, which proposes for a mix of retail expansion (including retail stores, dining, and entertainment), a 1SO-room hotel, 300 residential apartments of which 20% will be "affordable units," and a skate park. Of the retail square footage, a minimum of at least 7S,OOO square feet will be commercial office space. The project has been separated into phases. Phase 1A includes the interior and exterior mall renovation, a great lawn/plaza that includes a skate park. Phase 1B includes 350 residential units with ground floor commercial development. Phase 1C includes the development of a new hotel. Permitting for Phases 1A and 1B are pending final Engineering approval with submission for phase 1C expected in the near future. A plan for an additional 300 residential units, Phase 2, was recengy submitted for a planning entitlement process that is expected to go before the Planning Commission in thl Spring of 2024.
Outside of the commercial zones, construction has begun on a mixed-use project that includes 115 apartment units, a revitalized 110-room hotel (that had previously been dormant), and approximately 20,OOO square feet of commercial space that was approved by the City Council on the corner'of PCtt anO palos Verdes Blvd. The City has conducted numerous inspections as the project advances and is working closely with the builder to ensure it is completed successfully.
The construction of 36 residential town homes located on Fisk Lane & 190th Street has also occurred, which will.feature units ranging in size from 1,800-2,300 square feet. Sales of the units has taken place and the project is awaiting final inspections to issue the certificates of occupancy.
The number of projects under construction, or preparing for construction, reflect the City's strong property values and signal the potential for increased tax revenues in the Cig, driven in large part by-iedbnd6 Beach's high quali$ of life, the continued excellence of the Redondo Beach Unified SCnool Distiict and the city's close proximity to LAX airport and the silicon Beach technology hub.
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Propefi Tax
Property tax is the City's largest revenue source, which is imposed on real property (land and permanently attached improvements, such as buildings) and tangible personal property (moveable property) located within the City. Property is initially assessed by the Coung Assessor at a tax rate of 1.07o of the assessed value and can rise no more than2.0o/o each year. The City receives revenues equalto 16.50/o of the tax rate from the County of Los Angeles Auditor/Controller's Office. This equals 16.5 cents out of each dollar of property tax collected by Los Angeles County for property in the City.
For FY 2022-23, property tax revenue was based on calendar year 2021 property values. Actual revenues were higher than budgeted. The City's FY 2022-23 citywide assessed valuation is above the prior year by $1.2 billion, or6.5%, increasing to $20.5 billion. The City's assessed valuation amount is derived 82.4o/o from residential properties, 7.9% from commercial properties, 3.47o from industrial properties, and the remaining 6.3% from vacant, institutional, and other properties.
During FY 2022-23, property tax revenue (including homeowners'exemptions) increased by $2.17 million, or 6.8%, to $34.2 million, consistent with the strong assessed valuation increase over the prior year.
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DRAFT
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Sales lax
Sales tax is the Cig's second largest revenue souroe. The sales tax rate in Los Angeles County was 9.50% for FY 2022-23. Redondo Beach receives 1o/o of taxable sales from the California Department of Tax and Fee Administration. Until FY 2015-16, the data below includes revenue from the "triple flip" revenue swapping procedure, whereby 25 percent of the City's traditional sales tax base was committed to the State for deficit reduction bonds, and then reimbursed in the same amount as additional property tax revenue to the Ci$. Starting FY 2016-17, the data reflects the City's sales tiax proportion only.
Fiscal year 2022-23 sales tax revenue decreased by $0.7 million or 6.6% from prior year receipts as economic challenges including high inflation and Federal Reserve rate increases drove decreases in consumer spending, combined with the ongoing trend towards online purchasing. The City's largest business structure, including restaurants and hotels, experienced its first revenue slowdown since pandemic related losses, and the fuel sector showed large losses related to dramatic shifts in pricing. These declines are consistent with state and nation-wide trends.
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Transient Occupancy Tax (TOT)
Transient Occupancy Tax, the City's third largest single revenue source, is imposed on short-term occupants of hotels, motels, inns, tourist homes or other lodging facilities (those staying for 30 or fewer days). The current tax rate or 12o/o is applied to the customefs lodging bill. The rate was last increased in 2005 by 2o/o.
Through FY 2016-17, the City contributed 10o/o of TOT revenue to the Redondo Beach Chamber of Commerce and Visitors Bureau to support marketing and tourism in the City, offsetting the revenue received. ln the following fiscalyears, the City retains all TOT revenue.
TOT revenue continues to recover following the sharp decrease related to the pandemic, with FY 2022-23 revenue $0.8 million or 13.9% above the prior fiscal year.
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Vehicle License Fees (VLF)
Vehicle license fee revenue, the Ci$'s fourth largest revenue source, comes from a State-imposed tax on owners of registered vehicles for the privilege of operating a vehicle on public highways. The revenue reflects 2o/o ol the market value of the motor vehicle, which the City receives as motor vehicle in-lieu tax and through Property Tax receipts as property tax in lieu of vehicle license fees.
Vehicle License Fee revenue has increased consistently over the past 10 years, with an average annual increase of about 5%. Fiscal year 2022-23 revenue was $9.3 million, a 6.40/o increase over the prior year.
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Utility Users' Tax (UUI)
Utility users' tax (UUT), the City's fifth largest revenue souroe, is imposed on consumers of electric, gas, cable services, water and telephone services. Redondo Beach's UUT rate is set at 4.75o/o. ln the last 10 years, the City's UUT revenue has declined or remained relatively flat as more consumers move away from cable to internet based streaming services which are not taxed. This trend has changed in the past two fiscal years, with increases in UUT driven by general rate increases, population growth, more remote workers, inflation and naturalgas prices.
Fiscal year FY 2022-23 revenue was $9.2 million, a $1.1 million or 14.2o/o increase over the prior year.
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CAPITAL IMPROVEMENT PROJEGT PLAN NING, ACCOMPLISHMENTS AN D ACTIVITIES Over the past year, the City continued to plan, design and construct a significant number of capital improvement projects. Street improvement projects, with the greatest variety of funding sources, continued to represent a large portion of the work plan, however, several other projects were completed throughout the City as well.
The City continued with several Regional Measure R funded transportation-related capital projects. Design for the right turn lane project located on Aviation Boulevard at Artesia Boulevard ($1.4 mittion) is complete.
Construction for Phase 1 of the southbound right turn lane on lnglewood Avenue at Manhattan Beach Boulevard ($4.2 million) is substantially complete, with Phase 2 work, including signalized modifications, occurring in FY 2023-24. Similarly, the southbound Pacific Coast Highway at Torrance Boulevard Project ($1 million) remains with Caltrans for design review pending resolution of right-of-way acquisition needs.
The Transit center ($13.6 million) was officially opened in January 2023 with Phase 2, Kingsdale \Mdening ($1.6 million), under construction with completion anticipated in the first half of FY 2023-24.
Construction was completed on the Beryl Street - Flagler to Prospect - Drainage and Street lmprovements Project ($2.6 million). Construction of Residential Street Rehabilitation Cycle 2, Phase 3 ($+.g miilion), which includes Garnet Resurfacing, Avenue I Resurfacing, Deferred Maintenance and Green Street lmprovementswassubstantiallycompletedinFY2022-23. TheGrantAvenueSignallmprovementsProject was awarded and construction is expected in early calendar year 2024. Citywide Slurry Seal Phase 3 ($640,000) was also awarded a construction contract and has an anticipated completion in the first half of FY 2023-24.
The Skatepark Projects ($413,000) at Perry Park and Pad 10 were completed. Both locations have been open to the public since April 2023. The Community Garden ($80,000) at Alta Vista park was completed.
The rubberized play surfaces ($220,000) were replaced at Turtle Park, Perry Park, Andrews Park and Aviation Park. Design of the SCE ROW West of PCH Landscape lmprovements ($312,000) is largely complete and construction of Phase 1 of the project is scheduled to occur in FY 2023-24. The City Council approved the plans and specifications for the Dominguez Park Play Equipment, Landscape and Walkways Project ($1.8 million) and award of a construction contract is estimated to occur in FY 2023-24.
The City continues to devote significant resources to the maintenance and improvement of its wastewater infrastructure. Construction was completed for the Alta Vista Sewer Pump Station ($3.2 million). lmprovements and maintenance, including re-lining sewer pipes and root foaming, were continued citywide as part of the Sanitary Sewer Rehabilitation Project ($700,000). City Council awarded a contract for reconstruction of the Yacht Club Way ($3.9S million) and Portofino Sewer Pump Stations ($5.12 million) and those projects will begin construction inFY 2023-24. ln the waterfront, plans and specifications for the Harbor Dredging Project were completed. Construction will occur in early 2024. ciV staff continued with Pier restroom improvements (g100,000). Restroom 5 at the lnternational Boardwalk was the most recently upgraded facility. The Harbor Railing project ($1.S2 million), which replaced or rehabilitated most of the rails on the pier and added new iails around the Skatepark, was also completed. The Pier Light Fixture Project ($300,000) which replaced old fixtures with modern, more energy efficient, lights was also completed. Additionally, a design contract was awarded to Nuvis to prepare plans to reconstruct the Seaside Lagoon ($3.1 million).
The City officially completed 20 CIP projects inFY 2022-23 and designed and/or awarded contracts for construction of an additional 21 projects, for a total capital expenditure of $29.5 million, which is approximately $17 million dollars more than what was executed in Fy 2021-22.
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CASH MANAGEMENT POLICIES AND PRACTICES
The City invests all idle cash in various investment instruments, as authorized within the City's Statement of lnvestment Policy. The Ci$ Treasurer employs a buy and hold philosophy of cash management, ensuring the full return of all investment principal. ln February of 2013, the City commenced utilization of Meeder Public Funds (formerly FHN Mainstreet Advisors) in providing non-discretionary investment management services to the City Treasurer. Composition of the City's investment portfolio consists of a well-diversified mix of US Treasury securities, Federal Agency securities, FDIC insured collateralized deposits, and a blend of A-A/fu{ rated Corporate Medium-Term Notes, all of which are structured along a five-year laddered maturity schedule. ln addition, sufficient portfolio liquidity is maintained through continued maintenance of a significant portion of the investment portfolio's position in the State managed Local Agency lnvestment Fund, or LAIF.
The City maintains an lnvestment Policy certified for reporting excellence by the Government lnvestment Officers Association (GIOA) and has established both a written investment policy and investment procedures manual. The lnvestment Policy is reviewed by both the City Council and the Budget and 'Finance Commission on an annual basis. The investment policy's established performance benchmark is the thirty-month moving average of the ICE B of A zero to five-year Treasury index.
The level of investments maintained with LAIF fluctuates in accordance with variations in both the Gity's operational and capital improvement program cash flow requirements. The LAIF balance is maintained at a level of $5 to $25 million, or a range of 57o to 25o/o of the general portfolio's assets on average, ensuring maintenance of sufficient investment portfolio liquidity. The yield provided by LAIF has increased over the past year as short-term market interest rates increased. ldle investment funds above the liquidity threshold have-been placed primarily in Federal Agency investments within the two to five-year investment maturity range. The increase in market interest rates experienced over the past year have been both anticipated and well managed, proactively responding to both the City's operating and capital improvement cash flow requirements. ifre City's investment portfolio consistently meets the primary obiectives set forth in the City's investment policy.
As of June 30,2023, the City's general portfolio was invested as follows:
f .mnrrla6h of lnvaatmant Portfolio Posltlons F.Y, 2022-2021 1st quarter 2nd Quarter 3rd Quarter 4th Quarter
lnvestment Type %
Cash in Banks s10,95s,229 9,223,558 s5,3s9,470 5 9,742,075 So 0.o% Ss,149,678 434% S13,392,0s2 11.33% s 8,931,843 7.80% tund S 16,071,480 L4.5% s27,L37,5s6 23.7% ss.225.372 4.42% s 1,087,813 0.95% ss3,439,9s7 443% 547,448,357 40.4% s55,867,881 44.L2% s s5,918,780 49.70% Commercial Paper so o.o% So o.o% So 0.00% so 0.00%
Corporate Medium Term Notes s5,981,s21 6.3% s8,847,387 7.5% s8,866,737 7.50% s 8,88s,872 7.76% Bank c€rtificates of Deposit s1,239,s54 t.L% s99 1,622 o.8% s991.5E0 0.44% $ 99r,738 0.47% Treasuries s32,89s,358 29.7% 527,9tO,842 23.4% s12.83L.737 27.14% 5 37,713,4a3 32.93% s110,527,890 100% S117.48s.452 100.0% s118.175.459 100.00% S 114,529,s29 100.00% weiBhted Avera8e Maturity (Yrs) 1.99 r.72 t.97 1.91
Portfolio Effective Rate of Return (YTDI t.5L% L.7L% 2.LO% 2.29% L.A.l.F. Yield 1.60% 2.t7% 2.A3% 3.L7%
Yield on Benchmark o.97% L.38% L.76% 2.L9%
lnterest earned YTD 542s,011.78 s9s2,194.0s s1.69s.358 $2,43s,724 General Fund c-ontribution (50%) s2ss,007 5s7 1,3 15.00 5L,OL7,Z2L S1,451,434.40 As required by GASB 31, the Cig recorded the unrealized gain/loss on certain investments to account for the marketvalue on June 30, 2023. The portfolio marketvalue, $110,357,578, dropped belowthe book value of $114,529,529by-$4,171,951 of the current market value of the investments within the City's investment portfolio. Thii unrealized loss in the value of investments results from structural factors and interest rate movements within the financial marketplace over the past year impacting the market valuation of the City's investments in both Federal Agency issues and Corporate Medium-Term Notes Mon.v Market
DRAFT
RISK MANAGEMENT
The City maintains a self-insurance program for workers' compensation and liability claims. The program accumulates resources in the Self-lnsurance Program internal service fund to meet potential losses. For FY 2022-23, the self-insurance retention (SlR) is $75O,OOO for workers' compensation and $500,000 for general liabili$. Excess coverage up to $50 million for each workers' compensation claim is provided by a third-party private insurer, and excess liability up to $30 million for each occurrence is covered by public Risk lnnovation, Solutions, and Management (PRISM), formally the California State Association of Counties - Excess lnsurance Authority (CSAC-EIA).
PRISM is a joint powers authority for 95% of California counties as well as 68% of California municipalities where risks and losses are pooled together to keep annual premiums low. Both the workers' compensation and liability claim programs are managed by a third-party claims administrator under the direction of the Risk Management Division of the Human Resources Department.
The amounts included in the Self-lnsurance Program internal service fund are significant, parly due to requirements of GASB 10. ln complying with GASB 10, the City must record as a tiaOitity and exp'enditure not only actual risUloss experienced in the areas of workers' compensation and liability, Out also claims incurred but not reported (IBNR). IBNR claims include exposure for losses of which a city is not yet aware, as well as any statistically probable increase in costs for accidents that are already known to theCity. The appropriate amount to include on the financial statements for IBNR claims is typically developed by an actuary.
As of June 30,2023, the City recorded the foilowing:
Workers' Compensation Claims
claims payable totaled $13.3 million representing a decrease of approximately g3.3 million, or 2Oo/o, from the prior period. This decrease is attributable to lower estimated reserve requirements and the setlement of claims in previous years.
Liability Claims
Claims payable totaled $7.7 million representing a decrease of approximately $52.8 thousand, or O.7o/o, from the prior period. This decrease is attributaOte to the settlemeni of $Z.S million claims from the previous years.
U nem ployment I nsurance
The City participates in a direct-cost reimbursement method for unemployment insurance. This program is administered by the State Employment Development Department (EDD| to provide salary continua-nce for terminated employees. For Fy DRAFT
2022-29, reimbursement to EDD was $1'6,1 ig
PENSTON AND OTHER POST-EMPLOYMENT BENEFITS (OPEB)
The City provides three Tier 1 defined benefit pension plans - two for safety employees (3o/o al55 for Fire and 3o/o at 50 for Police) and one for miscellaneous employees (2o/o al55). Beginning July 2012, two additional Tier 2 defined beneflt pension plans were provided - one for safety employees (3% at 55 for both Fire and Police) and one for miscellaneous employees (2o/o al60). Beginning January 2013, pursuant to the California Public Employee's Pension Reform Act of 2013 (PEPRA), Tier 3 defined benefit pension plans were added, 2.7% at 57 lor safety employees and 2o/o at 62 for miscellaneous employees. These plans are part of the California Public Employees Retirement System (CaIPERS), which acts as a common investment and administrative agent for participating public employers within the State of California. The City makes contributions to the plans based on amounts determined by CaIPERS actuaries. Employees of iome bargaining groups paid a portion of the employee and/or employer contribution to CaIPERS.
CaIPERS began to separate the City's employer contributions into their "normal cosf and "unfunded liability"portionsinFY2OlT-18. Thenormalcostportioncontinuedtobepaidasapercentageofpayroll, while ihe unfunded liabilig portion was paid as a flat dollar amount. ln FY 2022-23, the percentage-based portion of the rate decreased from 9.307o to 9.23% for the miscellaneous group and from 32.670/o to 31 ,91% for public safety. The balance of the CaIPERS annual expense is made up by the City's unfunded liability contribution for all funds, which increased from $5,220,816 to $5,777,050 for the miscellaneous group and from $10,301 ,929 to $1 1 ,356,847 for public safety and a total payment amount of $17,133,897. During FY ZOZ1-2022 the City issued lease revenue bonds to pay off over $220M in unfunded liability thus reducing future costs and creating budget stability for the future. ln addition to the unfunded liability payoff, the contributions paid by the City for pension benefit employer and employer-paid member contributions was $6.6 million. Approximalely 83.7o/o, or $5.5 million, was charged to the General Fund. The budget in all funds for these FY 2022-23 contributions was $7.1 million.
Aside from contributing to CaIPERS, the City also contributes to SocialSecurity. The FY 2022-23 totalcost for Social Security and Medicare coverage was $2.1 million, of which $1.5 million, or 67.7o/o, was from the General Fund. Safety employees do not participate in Social Securi$ and Medicare, except for those employees hired after 1986, who are required to participate in Medicare.
The City also provides post-retirement health care benefits to its employees in accordance with agreements reached with various employee bargaining groups. The City pays for retirees' health care premiums in these plans up to limits estabtisned in the agreements with the bargaining units. After age 64, only lhe City's minimum health premium contribution under the Public Employees' Medical and Hospital Care Act (PEHMCA) is paid. These payments are paid via an Other Post-Employment_B_e19fits (OPEB) trust, which was estabiished by the City in FY 2009-2010 to comply with GASB 45. The OPEB trust allows the City to prefund actuarially derived OPEB costs that are expected to be incurred in future periods. ln FY 2022-23, ine City contributld $2.02 million to the OPEB trust to cover current and future retiree medical benefits; howevir, future contributions may vary based on updated actuarial studies. As of June 30,2023, the City was providing full benefits to 167 participants.
AWARDS
The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Redondo Beach for its Annual Comprehensive Financial Report (ACFR) for the year ended June 30, 2022. This makes 30 consecutive years that the City has been awbrOeit this achievement. ln order to be awarded this certificate, a government must publish an easily readable and efficiently organized comprehensive annual financial report. This report must satisff both generally accepted accounting principles and applicable legal requirements.
For Fy 2OZ2-23, the City will again apply to the GFOA for the Certificate of Achievement for Excellence in Financial Reporting. Wi Oetieve that our current annual comprehensive financial report continues to meet and exceed ihe criteria to receive this certificate, and we will be submitting it to GFOA for consideration.
DRAFT
ACKNOWLEDGMENTS
The preparation of this report has been accomplished with the efficient and dedicated services of the staff of the Financial Services Department. We also thank the City's independent auditors, Lance, Soll, & Lunghard, LLP, Certified Public Accountants, for their assistiance and expertise, and all the Gity departments for their cooperation during the audit engagement and their participation in preparing the required data. We wo_uld like to express our appreciation to the Mayor and City Council, the City's Audit Commiftee, and the Budget and Finance Commission for conducting the City's financial affairs in an engaged and responsible manner.
Respectfully submitted,
MIKE WTZANSKY
City Manager
DRAFT
MANAGEMENT'S DISCUSSION AND ANALYSIS
DRAFT
CITY OF REDONDO BEACH
MANAGEMENT’S DISCUSSION AND ANALYSIS
Management of the City of Redondo Beach (the “City”) provides the Management Discussion and Analysis of the City’s Annual Comprehensive Financial Report (ACFR) for readers of the City’s financial statements.
This narrative overview and analysis of the financial activities of the City is for the fiscal year ended June 30, 2023. We encourage readers to consider this information in conjunction with the additional information that is furnished in the letter of transmittal, which can be found preceding this narrative, and with the City’s financial statements, which follow. Keep in mind that the Financial Highlights, immediately following, are strictly snapshots of information. Net position, changes in net position, and fund disclosures are discussed in more detail later in the report.
Financial Highlights - Primary Government
• Government-Wide Highlights
Net Position - Assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows of resources at fiscal year ending June 30, 2023, by $136.6 million. Assets and deferred outflows for governmental activities exceeded liabilities and deferred inflows by $54.2 million and assets and deferred outflows for business-type activities exceeded liabilities and deferred inflows by $82.4 million.
Changes in Net Position - The City’s net position increased $15.3 million in fiscal year 2022-2023.
Net position of governmental activities increased $11.7 million, and net position of business-type activities increased $3.6 million.
• Fund Highlights
Governmental Funds - At the close of fiscal year 2022-2023, the City’s total governmental funds reported a fund balance of $69.1 million, an increase of $0.1 million from the prior year. Highlighted below are this year’s major funds included in this grouping.
General Fund - The fund balance of the General Fund (including Special Revenue – CalPERS Reserve Fund is zero) on June 30, 2023, was $33.2 million, an increase of $3.8 million from the prior year.
Special Revenue - Other Intergovernmental Grants Fund – The fund balance of the Special Revenue – Other Intergovernmental Grants Fund on June 30, 2023, was negative $(6.1) million, a decrease to the negative fund balance by $805 thousand from the prior year.
Special Revenue - Low-Mod Income Housing Fund - The fund balance of the Special Revenue - Low-Mod Income Housing Fund on June 30, 2023, was $3.5 million, a decrease of $344 thousand from the prior year.
DRAFT
OVERVIEW OF FINANCIAL STATEMENTS
This discussion and analysis are intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements are comprised of three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements.
Government-Wide Financial Statements
The government-wide financial statements are designed to provide readers with a broad overview of the City’s finances, in a manner similar to private-sector business. They are comprised of the following:
• Statement of Net Position
The Statement of Net Position presents summarized information of all the City’s assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. This financial statement combines and consolidates governmental funds’ current financial resources with capital assets and long-term obligations. • Statement of Activities
The Statement of Activities presents information showing how the government’s net assets changed during the fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of the related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned, but unused vacation leave).
Government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities).
The governmental activities of the city include general government, public safety, public works, cultural and leisure services and housing and community development. Business type activities include operations of the harbor, sewer (wastewater), solid waste, and transit.
The government-wide financial statements include not only the City itself (known as the primary government), but also the activities of legally separate component units: the Parking Authority of the City of Redondo Beach, the Redondo Beach Public Financing Authority (PFA), the Redondo Beach Community Financing Authority (CFA), and the Redondo Beach Housing Authority. Because the City Council acts as the governing board for each of these component units and because they function as part of the city government, their activities are blended with those of the primary government.
The government-wide financial statements can be found behind the tab section titled Government-Wide Financial Statements.
DRAFT
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into three categories: Governmental funds, proprietary funds, and fiduciary funds.
The fund financial statements provide detail information about each of the City’s most significant funds, called Major Funds. The concept of Major Funds, and the determination of which are major funds, was established by GASB Statement No. 34 (GASB 34) and replaces the concept of combining like funds and presenting them in total. Instead, each Major Fund is presented individually, while all Non-Major Funds are summarized and presented in a single column.
• Governmental Funds
Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term financial requirements.
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. By doing so, readers may better understand the long-term impact of the government’s near-term financing decisions. A reconciliation of both the governmental funds balance sheet and the governmental funds statement of revenues, expenditures, and changes in fund balance with the government-wide financial statements can be found on pages behind the tab section titled Government-Wide Financial Statements.
The City has 25 governmental funds, of which three are considered major funds for presentation purposes. Each major fund is presented separately in the governmental funds balance sheet and in the governmental funds statement of revenues, expenditures, and changes in fund balances.
The City’s four major funds are: the General Fund, the Other Intergovernmental Grants Special Revenue Fund, and the Low-Mod Income Housing Special Revenue Fund. Data from the nonmajor governmental funds (e.g., State Gas Tax Fund, Proposition A Fund, Storm Drain Fund, Disaster Recovery Fund…) are combined into a single aggregated presentation. The governmental funds financial statements can be found on pages behind the tab section titled Fund Financial Statements. Individual fund data for each of the non-major governmental funds is provided in the form of combining statements on pages behind the tab section titled Non-Major Governmental Funds.
DRAFT
• Proprietary Funds
The City maintains two types of proprietary funds: enterprise funds and internal service funds.
Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. Enterprise funds are used to account for harbor activities, solid waste (i.e., collection, recycling and hazardous waste disposal), operations and maintenance of City sewers, and transit activities. Internal service funds are used to accumulate and account for the City’s vehicles, building maintenance and repair, major facilities repair, information technology, emergency communications, and insurance. Because internal services predominantly benefit governmental rather than business-type functions, they have been included within governmental activities in the government-wide financial statements.
Proprietary funds’ financial statements provide the same type of information as the governmentwide financial statements, only in more detail. Like the government-wide financial statements, proprietary funds’ financial statements use the accrual basis of accounting. Separate financial statements are provided for Harbor Uplands, Harbor Tidelands, Solid Waste, Wastewater, and Transit. Conversely, the internal service funds are combined into a single, aggregated presentation in the proprietary funds’ financial statements. Individual fund data for each internal service fund is provided in the form of combining statements in the Internal Service Funds section of this report.
The basic proprietary funds financial statements can be found behind the tab section titled Fund Financial Statements.
• Fiduciary Funds
Fiduciary (Custodial and Private-Purpose Trust Fund) funds are used to account for resources held for the benefit of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support City programs.
Notes to the Financial Statements
The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found behind the tab section titled Notes to the Financial Statements.
Required Supplementary Information
In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information. The required supplementary information includes disclosure of the modified approach for the city pavement infrastructure and budgetary, pension plan information, and other post-employment benefit (OPEB) information. This information can be found behind the tab section titled Required Supplementary Information.
DRAFT
Current and Other Assets include: Cash and investments; Accounts receivable; Receivables for interest, taxes, and notes and loans; Internal balances (due to/from and advances between business activities and governmental activities); Due from other governments; Advances to Successor Agency; Prepaid items; and Restricted cash and investments with fiscal agents.
Capital Assets include: Asset’s net of depreciation as well as assets not being depreciated (e.g., Streets, Land, and Construction in progress).
Deferred Outflows of Resources include: Deferred charge on debt refunding, pension related items, and OPEB related items.
Long-Term Liabilities Outstanding include: Compensated absences payable, Claims and judgments payable, and Long-term debt payable.
Other Liabilities include: Accounts payable, Accrued liabilities; Pollution remediation liability; Accrued interest; Unearned revenue; and Deposits payable.
Deferred Inflows of Resources include: Pension related items and OPEB related items.
DRAFT
Net Position
The chart above reflects the City’s combined net position (governmental and business-type activities) of $136.6 million at the close of fiscal year ending June 30, 2023.
The largest portion of the City’s total net position (186.7%) reflects investment in capital assets (e.g., land, streets, sewers, buildings, machinery, and equipment) net of outstanding debt used to acquire those assets.
The city uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.
The remaining City net position represents resources that are either subject to external restrictions (e.g., certain capital projects, debt service) or unrestricted. The unrestricted net position is negative primarily as a result of pension related reporting first implemented in Fiscal Year 2014-2015 pursuant to GASB Statement No. 68.
Changes in Net Position
Also noted in the chart above, the City’s Fiscal Year 2022-2023 total net position increased by $15.3 million, or 12.7%, from the prior year. The governmental activities net position increased $11.7 million, or 27.6%, and business-type activities net position increased $3.6 million, or 4.6%.
Within total assets, capital assets, net of accumulated depreciation, increased by $26.7 million, or 11.1%.
This increase in capital assets also resulted in a corresponding increase in Net Investments in Capital Assets of $22.7 million, or 9.76%. The increase in net position is due to these capital asset increases and a decrease in deferred inflows of resources related to pensions and other post-employment benefits (OPEB) of $49.6 million. The significant decrease in deferred inflows, outflows, and long-term liabilities reflects the impact of the City’s 2021 payment related to the pension liability.
DRAFT
Levels of revenues and expenditures also impact current assets and other liabilities and, therefore, cause changes in net position. As reflected above, total revenues increased in fiscal year 2022-2023 by $4 million, or 2.5%. Decreases in program revenues are primarily reflected in charges for services. General revenue decreased overall as a result of lower transient occupancy tax revenue.
Citywide total expenses increased $16.9 million, or 12.5%, when compared to fiscal year 2021-2022. The increase in expenses was primarily related to increased personnel costs with higher CalPERS contributions and fiscal year 2020-2021 work on capital improvement projects.
DRAFT
Governmental Activities
As reflected in the Changes in Net Position schedule above, the total governmental activity expenses were $125.1 million in fiscal year 2022-2023; and total revenues from governmental activities were $136.6 million, of which 40% were derived from program revenues primarily consisting of charges for services and grants.
As shown on the following chart, the governmental activity expenses net of program revenues, increased $16.1 million, or 12.84%, in fiscal year 2022-2023. As with the increase in citywide total expenses, the increase reflects higher expenditures for pension-related items and capital improvement projects. *Program revenues are derived directly from the program itself or from parties outside the reporting government’s taxpayers or citizenry. They reduce the net cost of the function to be financed from the government’s general revenues.
DRAFT
The chart below is a graphical representation of the schedule above. (5) - 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80
General Government
Public Safety
Public Works
Cultural and Leisure Services
Housing and Community Services
Interest on Long-Term Debt
Dollars in Millions
EXPENSES NET OF PROGRAM REVENUES
Fiscal Year 2022-2023 Fiscal Year 2021-2022
DRAFT
General Revenues Related to Governmental Activities
General Revenues 2022-2023 2021-2022
Increase /
(Decrease)
Taxes $ 76,632,065 $ 73,874,265 3.7%
Use of Money and Property 3,558,292 83,927 4139.7%
Other Revenues 559,888 792,057 -29.3%
Total General Revenues 80,750,245 74,750,249 8.0%
General revenues are all other revenues not attributable to a specific program and, therefore, not categorized as program revenues. These revenues include taxes, use of money and property, and other revenues and increased 8%.
DRAFT
Business-Type Activities
The city has five business-type activities: Harbor Tidelands, Harbor Uplands, Solid Waste, Wastewater, and Transit. The total net position of the business-type activities increased by $3.6 million from the prior year.
Harbor Tidelands is used for the operations of small boat harbor facilities available to the general public, including related pier activities. This fund is restricted under the City Tidelands Trust Agreement with the State of California. In fiscal year 2022-2023, the total net position of the Harbor Tidelands increased by $1.7 million from the prior year.
Harbor Uplands is also used for the operations of small boat harbor facilities available to the general public, including related pier activities. However, the use of these funds is subject only to the decisions of the City Council. In fiscal year 2022-2023, the total net position of Harbor Uplands increases by $577 thousand from the prior year.
Wastewater is funded by a capital facility charge, more commonly referred to as a sewer user fee. These funds are used to support the City's sewer infrastructure operations and improvements. In fiscal year 2022- 2023, the total net position of Wastewater increased $792 thousand from the prior year.
Solid Waste is the City’s comprehensive solid waste program, which includes refuse collection, recycling, and hazardous waste disposal services. The solid waste program is supported through user service fees.
In fiscal year FY 2022-2023, the total net position of Solid Waste increased $542 thousand from the prior year.
Transit operations provide transportation services mainly to the cities of Redondo Beach, Hermosa Beach, and Manhattan Beach. The transit system is supported through bus passes, passenger fares, Transportation Development Act Article 4 funding, and Propositions A and C discretionary funding. In fiscal year 2022-2023, the total net position of Transit decreased $90 from the prior year.
INTERNAL SERVICE FUNDS
The City has six internal service funds, as well as overhead. The internal service funds are: Vehicle Replacement, Building Occupancy, Information Technology, Self-Insurance Program, Emergency Communications, and Major Facilities Repair. These funds are used to account for interdepartmental operations where service providers (e.g., fleet, IT, building maintenance) recoup costs by charging user departments.
FINANCIAL ANALYSIS OF INDIVIDUAL FUNDS
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. Please note that unlike the Government-Wide financial statements displayed previously, the fund financial statements which follow are not reflected on a full accrual basis. Therefore, amounts reflected in the fund financial statements versus the Government-Wide statements may differ due to this change in accounting methodology.
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Governmental Funds
The focus of the City’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City’s financial requirements.
In particular, unrestricted fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year.
Governmental Funds - The following schedule is a summary of governmental fund revenues for fiscal year ended June 30, 2023, and includes Major and Non-Major Funds. It reflects the amount and percent of increase or decrease of each source of revenue compared to the prior year.
Taxes
55.9%
Interdepartmental
6.4%
Licenses and
Permits
1.9%
Intergovernmental
19.3%
Charges for
Services
8.6%
Use of Money and
Property
2.6%
Fines and
Forfeitures
1.0% Miscellaneous
4.4%
Governmental Funds Source of Revenue
Fiscal Year 2022-2023
Source of Revenue
FY 22-23
Amount
Percent
of Total
FY 21-22
Amount
Increase
(Decrease)
Over Prior
Year
Taxes $ 76,632,065 55.9% 73,874,265 $ $ 2,757,800 % 3.73 Interdepartmental 8,745,517 6.4% 10,034,053 (1,288,536) % (12.84) Licenses and Permits 2,607,527 1.9% 1,731,396 876,131 % 50.60 Intergovernmental 26,443,713 19.3% 29,628,555 (3,184,842) % (10.75) Charges for Services 11,805,303 8.6% 10,895,140 910,163 % 8.35 Use of Money and Property 3,558,292 2.6% 83,927 3,474,365 % 4,139.75 Fines and Forfeitures 1,347,895 1.0% 1,247,572 100,323 % 8.04 Miscellaneous 6,049,378 4.4% 3,727,529 2,321,849 % 62.29 Total $ 137,189,690 100.0% 131,222,437 $ $ 5,967,253 % 4.55 Percent /
Increase
(Decrease)
Percent
DRAFT
Total governmental fund revenues increased $5.9 million, or 4.5%, from fiscal year 2021-2022. Taxes increased $2.7 million, or 3.7%, primarily from secured and unsecured property tax consistent with expected growth projections. Interdepartmental revenue decreased $1.3 million, or (12.8) %, with higher funding from sources recorded in the Intergovernmental Grants Fund for various capital improvement projects and bus purchases.
The following schedule is a summary of governmental fund expenditures by function for fiscal year ended June 30, 2023, and includes both Major and Non-Major Funds. It reflects the amount and percent of increase or decrease for each functional category of expenditures compared to the prior year.
General
Government
8.6%
Public Safety
40.7%
Public Works
8.9%
Housing and
Comm. Dev.
8.5%
Cultural and
Leisure
8.4%
Capital Outlay
15.1%
Debt Service:
9.8%
Governmental Funds Expenditures by Category
Fiscal Year 2022-2023
Expenditures
FY 22-23
Amount
Percent
of Total
FY 21-22
Amount
Increase
(Decrease)
From Prior
Year
Percent
Increase
(Decrease)
Current:
General Government $ 11,874,752 8.6% $ 24,894,820 $ (13,020,068) -52.3% Public Safety 56,313,610 40.7% 209,643,074 (153,329,464) -73.1% Public Works 12,372,547 8.9% 23,081,641 (10,709,094) -46.4% Housing and Comm. Dev. 11,686,810 8.5% 16,644,042 (4,957,232) -29.8% Cultural and Leisure 11,603,710 8.4% 15,492,140 (3,888,430) -25.1% Total Current Expenditures 103,851,429 75.1% 289,755,717 (185,904,288) -64.2% Capital Outlay 20,838,116 15.1% 14,567,037 6,271,079 43.0% Debt Service: 13,556,851 9.8% 6,859,846 6,697,005 97.6% Total $ 138,246,396 100.0% 311,182,600 $ $ (172,936,204) -55.6% DRAFT
Total governmental fund expenditures decreased $173 million, or 56%, from fiscal year 2021-2022. As mentioned earlier, the variances are attributable to:
• Current expenditures decreased by $186 million, or 64.2%, with lower personnel costs from lower CalPERS contributions.
• Capital outlay expenditures increased by $6.3 million, or 43%, reflecting the fluctuating nature of capital improvement project expenses.
• Debt service expenditures increased by $6.7 million or 97.6% in accordance with the debt payment schedules, including the first year of payments on the 2021A Lease Revenue Refunding Bonds.
Although there are three major funds in the City of Redondo Beach (the General Fund, the Other Intergovernmental Grants Fund, and the Low-Mod Income Housing Fund), the following discussions focus on the General Fund, which is the major operating fund of the City.
General Fund expenditures had exceeded revenues during fiscal years 2020-2021 and 2021-2022 which were fiscal years most impacted by the COVID-19 pandemic. When compared to the previous year, fiscal year 2023 revenues increased by $1.4 million, or 1.3%, while expenditures decreased $2.9 million, or
3.3%.
$50
$60
$70
$80
$90
$100
$110
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Dollars in Millions
Fiscal Year End
Revenues Expenditures
DRAFT
General Fund Balance
The fund balance of the General Fund as of June 30, 2023 was $33.2 million, an increase of $3.8 million or 13%, when compared to the prior year. The City Council approved the constraints of the General Fund balance reflected below.
As part of year-end activities, the City Council reviews the General Fund balance and determines how the City should commit/assign the unrestricted portion. As illustrated above, Council constraints of General Fund balance over the past several years reflect the City’s Strategic Plan. Aside from policy-designated amounts (i.e., General Fund Contingency and Compensated Absences), much of the money is committed or assigned to accomplish strategic goals.
Other Intergovernmental Grants Fund Balance
The fund balance of the Other Intergovernmental Grants Fund as of June 30, 2023 was $(6.1) million, a decrease to the negative fund balance of $805 thousand, when compared to the prior year. Revenues and expenditures of the fund, where monies from Federal, State and other governmental agencies are used primarily for capital improvement projects, tend to fluctuate from year to year depending on resources received from other governmental agencies.
Low-Mod Income Housing Fund Balance
The fund balance of the Low-Mod Income Housing Fund as of June 30, 2023 was $3.4 million, a decrease of $344 thousand, when compared to the prior year. Housing assets transferred from the dissolved Redevelopment Agency and funds generated from those assets are used to assist with housing needs for low- and moderate- income individuals.
DRAFT
GENERAL FUND BUDGETARY HIGHLIGHTS
The final amended fiscal year 2022-2023 budget totaled $108.6 million, including net amendments to the originally adopted budget and excluding transfers out of $4.1 million. The City Council adopts budget adjustments during the year to reflect both changed priorities and consideration of events that took place subsequent to the budget adoption. The amendments can be briefly summarized as follows:
• Funding of prior-year encumbrances of $1,270,389
• Funding of carry-over appropriations of $1,845,807.
• Increased mid-year appropriations by $861,121.
Budget amendments were funded from/credited to available fund balance. During the year, however, revenues exceeded budgetary estimates by approximately $3.6 million and expenditures were $8.6 million less than budgetary estimates, primarily due to contractual services that were not completed by year-end and 2021A bond principal and interest payments budgeted in Department operating budgets, but charged to transfers out.
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets
Capital assets of the city, including infrastructure assets are those assets used in the performance of the City’s functions. At June 30, 2023, net capital assets of the governmental and business-type activities totaled $191.2 million and $73.8 million, respectively. Depreciation on capital assets is recognized in the Government-Wide financial statements.
The city has elected to use the “Modified Approach” as defined by GASB 34 for infrastructure reporting for its paving system (streets). Under GASB 34, eligible infrastructure capital assets are not required to be depreciated as long as:
• The City manages the eligible infrastructure capital assets using an asset management system with characteristics of: 1) an up-to-date inventory, 2) condition assessments which summarize the results using a measurement scale, and 3) estimated annual amounts budgeted to maintain and preserve an established condition assessment level.
• The City documents the eligible infrastructure capital assets being preserved approximately at the established and disclosed condition assessment level.
Prior to fiscal year 2008-2009, the City’s PQI rating, an amalgam of the PCR and the International Roughness Index (IRI) established by the World Bank, was based on a 10.0 scale. In fiscal year 2008- 2009, the PQI rating was converted to a 100-point scale to make it comparable to alternative pavement rating methods. In fiscal year 2017-2018, the city moved to the PCI rating, an alternate paving rating method, which is most frequently used by adjacent cities for an easier comparison. In line with the Capital Improvement Program and as presented to the City Council on January 16, 2018, City policy is to achieve an average PCI rating of 75 for all streets beginning in fiscal year 2028. This rating allows minor cracking and raveling of the pavement along with minor roughness that could be noticeable to drivers traveling at posted speeds. As of June 30, 2023, the City’s Street system was rated at a PCI of 68.
The City’s budget for street maintenance for the fiscal year ended June 30, 2023 was $40.3 million. Actual expenditures were $14.5 million, with the remaining budget carried forward as continuing appropriations.
The city is judiciously investing in this infrastructure asset as part of the five-year Capital Improvement Program and will continue to rehabilitate and maintain its streets in order to achieve this goal. The estimated DRAFT
expenditures required to maintain and improve the overall condition of the streets from July 1, 2022 through June 30, 2023 is a minimum of $4.6 million.
More information on the modified approach for City streets infrastructure capital assets is behind the tab section titled Required Supplementary Information.
For more information on the City’s capital assets, refer to Note DRAFT
8 of the Notes to Financial Statements.
DEBT ADMINISTRATION
Debt service funds are used to account for the accumulation of resources for payment of interest and principal on bonds issued by the City. The ratio of net bonded debt to assessed valuation and the amount of bonded debt per capita for the fiscal year 2022-2023 are provided below. These indicators provide important information for management and concerned citizens, as well as potential investors.
Ratio of Debt
to Assessed Debt
Value of per
Amount Property Capita
Net Direct
Bonded Debt $20,512,490,095 1.19% $ 3,575.73
Bonds issued by the Community Financing Authority (CFA), a component unit of the City, were issued to finance various improvements to, and to remedy a variety of deficiencies in the facilities of the Wastewater Enterprise. In FY 2018-2019, the CFA issued bonds to refund various leaseback contingencies and finance the purchase of a sublease between the City and Redondo Fisherman's Cove Company. The city has no general obligation bond indebtedness.
For a complete listing of the City’s long-term debt obligations, refer to Note 10 of the Notes to Financial Statements.
ECONOMIC FACTORS AND NEXT YEAR’S BUDGET AND RATES
In considering Fiscal Year 2023-2024, the local economy willl be impacted by high interest rates and economic uncertainty, with key revenue sources showing slower revenues following exceptionally strong returns in FY 2022-23.
• Only impacted by possible payment delinquencies, property tax revenue for fiscal year 2023- 2024 is projected at $33.4 million, reflecting an incremental improvement in property values as assessed in calendar year 2022. Redondo Beach's housing market has remained fairly stable due to its coastal location. Property tax revenue is the City’s primary source of operating revenue.
• Sales and Use Tax revenue is projected to increase by about $115,000, or 1.0%, to $11.5 million, reflecting a small increase over a revised FY 2022-23 projection that reflected data from midyear FY 2022-23 indicating a projected sales tax recovery that was slower than projected following the pandemic. Even at the moderated pace, revenue is well ahead of the City’s prepandemic (FY 2018-19) revenue of approximately $10.6 million. • Utility Users’ Tax (UUT) revenue is projected to decrease by about $140,000 or 2% to $8.5 million. This slight decrease reflects more moderate estimates following exceptionally strong FY 2022-23 receipts. The estimate is based upon analysis of the projected performance from each of the categorical components of the City’s UUT tax base, including electricity, natural gas, telecommunications, water, and cable television. UUT revenue provides support for essential City operational services.
DRAFT
• Transient Occupancy Tax (TOT) revenue is projected to increase by $0.6 million, or 12.5% over prior year receipts to $6.8 million which is still below pre-pandemic levels of approximately $9,000,000. In addition to the anticipated slow recovery in tourism, nearly all of the TOT revenue for the Marine Avenue hotels will be returned to replenish the reserve account that has been used during the pandemic.
General Fund appropriations for fiscal year 2023-2024 are projected at $106.8 million, excluding transfers; or $110.6 million, including $3.8 million in transfers out. Personnel costs in the General Fund decreased by $1.8 million, or 3.3%, reflecting adjustments to budgeting methodology. The FY 2023-24 proposed personnel amounts also reflect restoration of previously deauthorized positions.
During fiscal year 2022-2023, Redondo Beach experienced a 6.5% change in real property assessed valuations, compared to the 2021-2022 increase of 3.3%. Additionally, for the 2022‐23 fiscal year, the actual value increase was due to the transfers of ownership which continues to be expected. Finally, The California Consumer Price Index (the “CCPI”) for 2022‐23 that has been approved by the State is 2.0% which will have impact to the annual adjustment and are directly correlated to economic recovery.
Transient occupancy tax FY 2022-23 actual receipts saw a 13.9% revenue increase over FY 2021-22, and actual sales tax receipts saw an 6.6% decrease while falling from ranking 42 out of 62 in total taxable retail sales out of 88 cities in Los Angeles County. The unemployment rate for Redondo Beach in 2023 fell to
3.3% from 6.5% in 2022 and a pandemic-high peak of 9.4% in 2020. This is below the Los Angeles County and the State of California 2022 unemployment rates of 4.2% and 4.1%, respectively.
CONTACTING THE CITY’S FINANCIAL MANAGEMENT
The financial report is designed to provide our citizens, taxpayers, customers, investors and creditors with a general overview of the City’s finances and to show the City’s accountability for the money it receives. If you have questions about this report, or need additional financial information, contact the Financial Services Department at 415 Diamond Street, Redondo Beach CA 90277, phone 310-697-3138, or e-mail [email protected].
DRAFT
BASIC FINANCIAL STATEMENTS
DRAFT
GOVERNMENT-WIDE FINANCIAL STATEMENTS
DRAFT
CITY OF REDONDO BEACH
Statement of Net Position
Governmental Business-Type
Activities Activities Total
Assets:
Cash and investments $ 96,832,814 $ 33,208,159 $ 130,040,973 Receivables:
Accounts 2,879,572 1,325,097 4,204,669
Taxes 5,834,434 182,197 6,016,631
Accrued interest 473,279 254,293 727,572
Notes and loans 2,842,962 - 2,842,962
Leases 5,221,162 69,023,358 74,244,520
Internal balances 1,175,456 (1,175,456) -
Prepaid costs 160,070 - 160,070
Due from other governments 14,469,092 1,498,449 15,967,541 Advances to Successor Agency 535,731 - 535,731
Cash with fiscal agent 1,303,816 399 1,304,215
Capital assets not being depreciated 112,891,496 30,612,815 143,504,311 Capital assets, net of depreciation 79,487,404 43,143,641 122,631,045 Total Assets 324,107,288 178,072,952 502,180,240
Deferred Outflows of Resources:
Deferred charge on refunding - 282,785 282,785
Deferred pension related items 51,137,663 6,036,045 57,173,708 Deferred OPEB related items 3,512,607 422,083 3,934,690 Total Deferred Outflows
of Resources 54,650,270 6,740,913 61,391,183
Liabilities:
Accounts payable 8,788,877 4,901,568 13,690,445
Accrued liabilities 3,439,472 - 3,439,472
Accrued interest 832,289 75,310 907,599
Unearned revenue 486,201 43,712 529,913
Deposits payable 5,103,378 241,117 5,344,495
Pollution remediation liability 150,000 - 150,000
Compensated absences due in one year 947,382 137,234 1,084,616 Claims payable due in one year 748,564 - 748,564
Long-term obligations due in one year 8,109,312 967,480 9,076,792 Noncurrent liabilities:
Compensated absences due in more than one year 2,842,145 411,690 3,253,835 Claims payable due in more than one year 20,172,822 - 20,172,822 Long-term obligations due in more than one year 220,463,048 22,182,420 242,645,468 Net pension liability 27,806,069 2,991,244 30,797,313
Net OPEB liability 11,595,633 1,393,354 12,988,987
Total Liabilities 311,485,192 33,345,129 344,830,321
Deferred Inflows of Resources:
Deferred pension related items 3,663,675 567,024 4,230,699 Deferred OPEB related items 4,260,579 511,958 4,772,537 Deferred leases related items 5,156,539 67,940,032 73,096,571 Total Deferred Inflows
of Resources 13,080,793 69,019,014 82,099,807
Net Position:
Net investment in capital assets 189,024,081 66,054,613 255,078,694 Restricted for:
Housing and community development 12,406,540 - 12,406,540 Public safety 495,635 - 495,635
Public works 5,906,803 - 5,906,803
Debt service 5,375,387 - 5,375,387
Low and moderate income housing 4,854,515 - 4,854,515
Unrestricted (163,871,388) 16,395,109 (147,476,279)
Total Net Position $ 54,191,573 $ 82,449,722 $ 136,641,295 June 30, 2023
Primary Government
See Notes to Financial Statements.
1 DRAFT
CITY OF REDONDO BEACH
Statement of Activities
Year Ended June 30, 2023
Operating Capital
Charges for Contributions Contributions
Expenses Services and Grants and Grants
Functions/Programs
Primary Government:
Governmental Activities:
General government $ 8,875,247 $ 11,449,964 $ 7,563 $ - Public safety 77,329,726 5,214,506 3,897,642 -
Housing and community development 10,119,877 5,923,067 812,381 - Cultural and leisure services 11,227,624 10,742,331 7,913,452 1,277,561 Public works 11,459,350 2,953,076 3,870,924 1,811,344
Interest on long-term debt and fiscal charges 6,046,346 - - - Total Governmental Activities 125,058,170 36,282,944 16,501,962 3,088,905 Business-Type Activities:
Harbor Tidelands 6,414,101 7,624,821 20,000 -
Harbor Uplands 3,877,153 5,754,907 - -
Wastewater 4,852,027 5,433,482 - -
Solid Waste 5,627,344 6,141,657 28,234 -
Transit 5,819,936 165,196 4,143,094 -
Total Business-Type Activities 26,590,561 25,120,063 4,191,328 - Total Primary Government $ 151,648,731 $ 61,403,007 $ 20,693,290 $ 3,088,905 General Revenues:
Taxes:
Property taxes, levied for general purpose
Transient occupancy taxes
Sales taxes
Franchise taxes
Business licenses taxes
Utility users tax
Other taxes
Motor vehicle in lieu - unrestricted
Use of money and property
Other
Gain on sale of capital asset
Transfers
Total General Revenues and Transfers
Change in Net Position
Net Position at Beginning of Year
Net Position at End of Year
Program Revenues
See Notes to Financial Statements.
2 DRAFT
Primary Government
Governmental Business-Type
Activities Activities Total
$ 2,582,280 $ - $ 2,582,280
(68,217,578) - (68,217,578)
(3,384,429) - (3,384,429)
8,705,720 - 8,705,720
(2,824,006) - (2,824,006)
(6,046,346) - (6,046,346)
(69,184,359) - (69,184,359)
- 1,230,720 1,230,720
- 1,877,754 1,877,754
- 581,455 581,455
- 542,547 542,547
- (1,511,646) (1,511,646)
- 2,720,830 2,720,830
(69,184,359) 2,720,830 (66,463,529)
45,649,338 - 45,649,338
6,174,326 - 6,174,326
11,036,523 - 11,036,523
2,131,206 - 2,131,206
1,301,224 - 1,301,224
9,166,031 - 9,166,031
1,173,417 - 1,173,417
72,000 - 72,000
3,558,292 1,055,954 4,614,246
470,103 - 470,103
17,785 1,241 19,026
138,511 (138,511) -
80,888,756 918,684 81,807,440
11,704,397 3,639,514 15,343,911
42,487,176 78,810,208 121,297,384
$ 54,191,573 $ 82,449,722 $ 136,641,295
Net (Expenses) Revenues
and Changes in Net Position
See Notes to Financial Statements.
3 DRAFT
FUND FINANCIAL STATEMENTS
Governmental Fund Financial Statements
Proprietary Fund Financial Statements
Fiduciary Fund Financial Statements
4 DRAFT
CITY OF REDONDO BEACH
Balance Sheet
Governmental Funds
June 30, 2023
General
Assets:
Pooled cash and investments $ 24,931,434 $ 16,911 $ 1,491,790 Receivables:
Accounts 2,257,139 429,000 -
Taxes 5,378,629 - -
Accrued interest 415,855 - -
Notes and loans 21,839 - 2,494,896
Leases 3,933,367 - -
Prepaid costs 148,160 - -
Due from other governments 1,622,672 7,429,039 -
Due from other funds 8,103,574 - -
Advances to Successor Agency - - 535,731
Restricted assets:
Cash and investments with fiscal agents 1,246,492 - -
Total Assets $ 48,059,161 $ 7,874,950 $ 4,522,417
Liabilities, Deferred Inflows of Resources,
and Fund Balances:
Liabilities:
Accounts payable $ 2,077,857 $ 1,590,188 $ 52,498
Accrued liabilities 3,439,472 - -
Unearned revenues 153,601 332,600 -
Deposits payable 5,103,378 - -
Due to other funds - 5,739,212 582,213
Pollution remediation liability 150,000 - -
Total Liabilities 10,924,308 7,662,000 634,711
Deferred Inflows of Resources:
Unavailable revenues 59,493 6,266,304 389,992
Deferred leases related items 3,886,942 - -
Total Deferred Inflows of Resources 3,946,435 6,266,304 389,992 Fund Balances:
Nonspendable:
Prepaid costs 148,160 - -
Notes and loans 21,839 - -
Restricted for:
Housing and community development - - -
Public safety - - -
Public works - - -
Debt service - - -
Low and moderate income housing - - 3,497,714
Committed to:
Contingency 8,599,208 - -
Assigned to:
Capital projects - - -
Compensated absenses 785,832 - -
Future pension payments 7,975,721 - -
Continuing operations 15,466,707 - -
Unassigned 190,951 (6,053,354) -
Total Fund Balances 33,188,418 (6,053,354) 3,497,714
Total Liabilities, Deferred Inflows of
Resources, and Fund Balances $ 48,059,161 $ 7,874,950 $ 4,522,417 Special Revenue Funds
Other
Intergovernmental
Grants
Low-Mod Income
Housing
See Notes to Financial Statements.
5 DRAFT
CITY OF REDONDO BEACH
Balance Sheet
Governmental Funds
June 30, 2023
Assets:
Pooled cash and investments
Receivables:
Accounts
Taxes
Accrued interest
Notes and loans
Leases
Prepaid costs
Due from other governments
Due from other funds
Advances to Successor Agency
Restricted assets:
Cash and investments with fiscal agents
Total Assets
Liabilities, Deferred Inflows of Resources,
and Fund Balances:
Liabilities:
Accounts payable
Accrued liabilities
Unearned revenues
Deposits payable
Due to other funds
Pollution remediation liability
Total Liabilities
Deferred Inflows of Resources:
Unavailable revenues
Deferred leases related items
Total Deferred Inflows of Resources
Fund Balances:
Nonspendable:
Prepaid costs
Notes and loans
Restricted for:
Housing and community development
Public safety
Public works
Debt service
Low and moderate income housing
Committed to:
Contingency
Assigned to:
Capital projects
Compensated absenses
Future pension payments
Continuing operations
Unassigned
Total Fund Balances
Total Liabilities, Deferred Inflows of
Resources, and Fund Balances
Other Total
Governmental Governmental
Funds Funds
$ 34,544,676 $ 60,984,811
130,167 2,816,306
455,805 5,834,434
57,424 473,279
326,227 2,842,962
1,287,795 5,221,162
- 148,160
5,417,381 14,469,092
4,411,513 12,515,087
- 535,731
57,324 1,303,816
$ 46,688,312 $ 107,144,840
$ 1,388,367 $ 5,108,910
- 3,439,472
- 486,201
- 5,103,378
5,018,206 11,339,631
- 150,000
6,406,573 25,627,592
538,428 7,254,217
1,269,597 5,156,539
1,808,025 12,410,756
- 148,160
- 21,839
12,406,540 12,406,540
495,635 495,635
5,906,803 5,906,803
5,375,387 5,375,387
1,356,801 4,854,515
- 8,599,208
12,960,508 12,960,508
- 785,832
- 7,975,721
- 15,466,707
(27,960) (5,890,363)
38,473,714 69,106,492
$ 46,688,312 $ 107,144,840
See Notes to Financial Statements.
6 DRAFT
CITY OF REDONDO BEACH
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position
June 30, 2023
Fund balances of governmental funds $ 69,106,492
Amounts reported for governmental activities in the statement of net position are different because:
Capital assets net of depreciation have not been included as financial resources in governmental fund activity. 183,120,502
Long-term debt and compensated absences
that have not been included in the governmental fund activity:
Bonds payable $ (215,882,891)
Leases and subscriptions (2,512,149)
Net OPEB liability (10,930,304)
Net pension liability (26,673,713)
Compensated absences (3,486,700) (259,485,757)
Accrued interest payable for the current portion of interest due on Bonds has not been reported in the governmental funds. (787,465) Revenues reported as unavailable revenue in the governmental funds and recognized in the statement of activities. These are included in the intergovernmental revenues in the governmental fund activity. 7,254,217
Deferred outflows and inflows of resources in governmental activities are not financial resources and, therefore, are not reported in the governmental funds:
Deferred outflows of resources - pension related items 48,667,633 Deferred inflows of resources - pension related items (3,389,210) Deferred outflows of resources - OPEB related items 3,311,061 Deferred inflows of resources - OPEB related items (4,016,118) Internal service funds are used by management to charge the costs of certain activities, such as equipment management and self-insurance, to individual funds.
The assets and liabilities of the internal service funds must be added to the statement of net position. 10,410,218
Net Position of Governmental Activities $ 54,191,573
See Notes to Financial Statements.
7 DRAFT
CITY OF REDONDO BEACH
Statement of Revenues,
Expenditures and Changes in Fund Balances
Governmental Funds
Year Ended June 30, 2023
General
Revenues:
Taxes $ 76,446,608 $ - $ -
Interdepartmental 8,745,517 - -
Licenses and permits 2,607,527 - -
Intergovernmental 331,107 8,149,118 -
Charges for services 9,924,671 - -
Use of money and property 2,535,421 - 41,781
Fines and forfeitures 1,341,895 - -
Miscellaneous 3,917,756 - -
Total Revenues 105,850,502 8,149,118 41,781
Expenditures:
Current:
General government 11,433,726 437,769 -
Public safety 55,465,035 672,852 -
Housing and community development 3,425,042 67,402 106,722 Cultural and leisure services 11,054,870 268,712 279,000 Public works 7,515,994 86,759 -
Capital outlay 469,495 6,178,217 -
Debt service:
Principal retirement 379,343 67,743 -
Interest and fiscal charges 10,452 10,968 -
Total Expenditures 89,753,957 7,790,422 385,722
Excess (Deficiency) of Revenues
Over (Under) Expenditures 16,096,545 358,696 (343,941)
Other Financing Sources (Uses):
Transfers in 1,650,733 - -
Transfers out (14,343,215) - -
Subscription financing 415,357 446,705 -
Total Other Financing Sources (Uses): (12,277,125) 446,705 - Net Change in Fund Balances 3,819,420 805,401 (343,941) Fund Balances, Beginning of Year 29,368,998 (6,858,755) 3,841,655 Fund Balances, End of Year $ 33,188,418 $ (6,053,354) $ 3,497,714 Other
Intergovernmental
Grants
Low-Mod Income
Housing
Special Revenue Funds
See Notes to Financial Statements.
8 DRAFT
CITY OF REDONDO BEACH
Statement of Revenues,
Expenditures and Changes in Fund Balances
Governmental Funds
Year Ended June 30, 2023
Revenues:
Taxes
Interdepartmental
Licenses and permits
Intergovernmental
Charges for services
Use of money and property
Fines and forfeitures
Miscellaneous
Total Revenues
Expenditures:
Current:
General government
Public safety
Housing and community development
Cultural and leisure services
Public works
Capital outlay
Debt service:
Principal retirement
Interest and fiscal charges
Total Expenditures
Excess (Deficiency) of Revenues
Over (Under) Expenditures
Other Financing Sources (Uses):
Transfers in
Transfers out
Subscription financing
Total Other Financing Sources (Uses):
Net Change in Fund Balances
Fund Balances, Beginning of Year
Fund Balances, End of Year
Other Total
Governmental Governmental
Funds Funds
$ 185,457 $ 76,632,065
- 8,745,517
- 2,607,527
17,963,488 26,443,713
1,880,632 11,805,303
981,090 3,558,292
6,000 1,347,895
2,131,622 6,049,378
23,148,289 137,189,690
3,257 11,874,752
175,723 56,313,610
8,087,644 11,686,810
1,128 11,603,710
4,769,794 12,372,547
14,190,404 20,838,116
7,172,018 7,619,104
5,916,327 5,937,747
40,316,295 138,246,396
(17,168,006) (1,056,706)
14,361,809 16,012,542
(1,510,726) (15,853,941)
118,410 980,472
12,969,493 1,139,073
(4,198,513) 82,367
42,672,227 69,024,125
$ 38,473,714 $ 69,106,492
See Notes to Financial Statements.
9 DRAFT
CITY OF REDONDO BEACH
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds
to the Statement of Activities
Year Ended June 30, 2023
Net change in fund balances - total governmental funds $ 82,367 Amounts reported for governmental activities in the statement of activities are different because:
Governmental funds report capital outlays as expenditures. However, in the statement of activities, the costs of those assets is allocated over their estimated useful lives as depreciation expense. This is the amount by which capital outlays exceeded depreciation in the current period.
Capital outlay $ 22,231,590
Depreciation (4,421,043) 17,810,547
Repayment of bond principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net position.
Principal repayments 7,148,148
Leases and subscriptions principal repayments 470,956
Subscriptions financing (980,472)
Amortization of bond premiums/discounts (25,732) 6,612,901 Accrued interest for long-term liabilities. This is the net change in accrued interest for the current period. 178,863
Compensated absences expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. 19,007
Governmental funds report all contributions in relation to the annual required contribution for pensions as expenditures, however, in the Statement of Activities, pension expense is actually determined and certain pension related adjustments are deferred to future periods. (13,507,188) Governmental funds report all contributions in relation to the annual required contribution for OPEB as expenditures, however, in the Statement of Activities, OPEB expense is actually determined and certain pension related adjustments are deferred to future periods. 891,428 Revenues reported as unavailable revenue in the governmental funds and recognized in the statement of activities. These are included in the intergovernmental revenues in the governmental fund activity. (583,419)
Internal service funds are used by management to charge the costs of certain activities, such as equipment management and self-insurance, to individual funds.
The net revenues (expenses) of the internal service funds is reported with governmental activities. 199,891
Change in Net Position of Governmental Activities $ 11,704,397 See Notes to Financial Statements.
10 DRAFT
CITY OF REDONDO BEACH
Statement of Net Position
Proprietary Funds
June 30, 2023
Assets:
Current:
Cash and investments $ 10,043,321 $ 1,795,542 $ 19,043,970 Receivables:
Accounts 625,024 354,050 21,048
Taxes - - 82,563
Accrued interest 115,580 41,648 97,065
Leases 45,196,992 23,826,366 -
Prepaid costs - - -
Due from other governments 20,000 - -
Due from other funds 292,173 - -
Restricted:
Cash with fiscal agent - - 399
Total Current Assets 56,293,090 26,017,606 19,245,045
Noncurrent:
Capital assets - net of accumulated depreciation 24,733,629 23,638,213 23,959,001 Total Noncurrent Assets 24,733,629 23,638,213 23,959,001 Total Assets 81,026,719 49,655,819 43,204,046
Deferred Outflows of Resources:
Deferred charge on refunding - - 282,785
Deferred pension related items 2,882,095 1,347,600 957,127 Deferred OPEB related items 195,760 92,439 72,196
Total Deferred Outflows of Resources 3,077,855 1,440,039 1,312,108 Liabilities:
Current:
Accounts payable 2,037,667 151,421 1,592,629
Accrued interest 39,427 13,082 13,263
Unearned revenues - - -
Deposits payable 142,879 98,238 -
Due to other funds 544,986 - -
Accrued compensated absences 53,192 12,137 35,487
Accrued claims and judgments - - -
Subscriptions - due within one year - - -
Long-term debt - due within one year 328,860 108,864 450,376 Total Current Liabilities 3,147,011 383,742 2,091,755
Noncurrent:
Accrued compensated absences 159,576 36,411 106,459
Accrued claims and judgments - - -
Subscriptions - due in more than one year - - -
Long-term debt - due in more than one year 9,160,550 3,039,696 7,765,729 Net pension liability 1,536,418 692,906 403,717
Net OPEB liability 646,233 305,153 238,331
Total Noncurrent Liabilities 11,502,777 4,074,166 8,514,236 Total Liabilities 14,649,788 4,457,908 10,605,991
Deferred Inflows of Resources:
Deferred pension related items 220,697 114,986 122,580
Deferred OPEB related items 237,445 112,122 87,570
Deferred lease related items 44,585,408 23,354,624 -
Total Deferred Inflows of Resources 45,043,550 23,581,732 210,150 Net Position:
Net investment in capital assets 23,087,779 23,605,366 17,935,855 Unrestricted 1,323,457 (549,148) 15,764,158
Total Net Position $ 24,411,236 $ 23,056,218 $ 33,700,013 Business-Type Activities - Enterprise Funds
Harbor
Tidelands Harbor Uplands Wastewater
See Notes to Financial Statements.
11 DRAFT
CITY OF REDONDO BEACH
Statement of Net Position
Proprietary Funds
June 30, 2023
Assets:
Current:
Cash and investments
Receivables:
Accounts
Taxes
Accrued interest
Leases
Prepaid costs
Due from other governments
Due from other funds
Restricted:
Cash with fiscal agent
Total Current Assets
Noncurrent:
Capital assets - net of accumulated depreciation
Total Noncurrent Assets
Total Assets
Deferred Outflows of Resources:
Deferred charge on refunding
Deferred pension related items
Deferred OPEB related items
Total Deferred Outflows of Resources
Liabilities:
Current:
Accounts payable
Accrued interest
Unearned revenues
Deposits payable
Due to other funds
Accrued compensated absences
Accrued claims and judgments
Subscriptions - due within one year
Long-term debt - due within one year
Total Current Liabilities
Noncurrent:
Accrued compensated absences
Accrued claims and judgments
Subscriptions - due in more than one year
Long-term debt - due in more than one year
Net pension liability
Net OPEB liability
Total Noncurrent Liabilities
Total Liabilities
Deferred Inflows of Resources:
Deferred pension related items
Deferred OPEB related items
Deferred lease related items
Total Deferred Inflows of Resources
Net Position:
Net investment in capital assets
Unrestricted
Total Net Position
Governmental
Other ActivitiesNon-major Internal
Enterprise Funds Totals Service Funds
$ 2,325,326 $ 33,208,159 $ 35,848,003
324,975 1,325,097 63,266
99,634 182,197 -
- 254,293 -
- 69,023,358 -
- - 11,910
1,478,449 1,498,449 -
- 292,173 -
- 399 -
4,228,384 105,784,125 35,923,179
1,425,613 73,756,456 9,258,398
1,425,613 73,756,456 9,258,398
5,653,997 179,540,581 45,181,577
- 282,785 -
849,223 6,036,045 2,470,030
61,688 422,083 201,546
910,911 6,740,913 2,671,576
1,119,851 4,901,568 3,679,967
9,538 75,310 44,824
43,712 43,712 -
- 241,117 -
922,643 1,467,629 -
36,418 137,234 75,707
- - 748,564
- - -
79,380 967,480 438,112
2,211,542 7,834,050 4,987,174
109,244 411,690 227,120
- - 20,172,822
- - -
2,216,445 22,182,420 9,739,208
358,203 2,991,244 1,132,356
203,637 1,393,354 665,329
2,887,529 26,978,708 31,936,835
5,099,071 34,812,758 36,924,009
108,761 567,024 274,465
74,821 511,958 244,461
- 67,940,032 -
183,582 69,019,014 518,926
1,425,613 66,054,613 8,740,054
(143,358) 16,395,109 1,670,164
1,282,255 $ 82,449,722 $ 10,410,218
Business-Type Activities - Enterprise
Funds
See Notes to Financial Statements.
12 DRAFT
CITY OF REDONDO BEACH
Statement of Revenues, Expenses
and Changes in Net Postiion
Proprietary Funds
Year Ended June 30, 2023
Operating Revenues:
Sales and service charges $ 888,641 $ 1,908,261 $ 5,433,482 Harbor rentals 6,725,680 3,846,646 -
Miscellaneous 10,500 - -
Total Operating Revenues 7,624,821 5,754,907 5,433,482
Operating Expenses:
Administration and general 711,609 555,909 333,834
Personnel services 2,792,260 231,799 2,614,048
Contractual services 1,033,339 623,243 588,302
Internal service charges 1,197,114 1,960,748 554,855
Depreciation expense 435,229 424,344 458,235
Total Operating Expenses 6,169,551 3,796,043 4,549,274
Operating Income (Loss) 1,455,270 1,958,864 884,208
Nonoperating Revenues (Expenses):
Intergovernmental 20,000 - -
Interest revenue 493,719 350,503 211,732
Interest expense (244,550) (81,110) (302,753)
Gain (loss) on disposal of capital assets - - -
Total Nonoperating
Revenues (Expenses) 269,169 269,393 (91,021)
Income (Loss) Before Transfers 1,724,439 2,228,257 793,187 Transfers in 1,787 417 -
Transfers out - (1,650,733) (389)
Changes in Net Position 1,726,226 577,941 792,798
Net Position:
Beginning of Year 22,685,010 22,478,277 32,907,215
End of Fiscal Year $ 24,411,236 $ 23,056,218 $ 33,700,013 Business-Type Activities - Enterprise Funds
Harbor
Tidelands Harbor Uplands Wastewater
See Notes to Financial Statements.
13 DRAFT
CITY OF REDONDO BEACH
Statement of Revenues, Expenses
and Changes in Net Postiion
Proprietary Funds
Year Ended June 30, 2023
Operating Revenues:
Sales and service charges
Harbor rentals
Miscellaneous
Total Operating Revenues
Operating Expenses:
Administration and general
Personnel services
Contractual services
Internal service charges
Depreciation expense
Total Operating Expenses
Operating Income (Loss)
Nonoperating Revenues (Expenses):
Intergovernmental
Interest revenue
Interest expense
Gain (loss) on disposal of capital assets
Total Nonoperating
Revenues (Expenses)
Income (Loss) Before Transfers
Transfers in
Transfers out
Changes in Net Position
Net Position:
Beginning of Year
End of Fiscal Year
Governmental
Other ActivitiesNon-major Internal
Enterprise Funds Totals Service Funds
$ 6,116,024 $ 14,346,408 $ 23,392,322
- 10,572,326 -
190,829 201,329 224,311
6,306,853 25,120,063 23,616,633
740,442 2,341,794 10,604,906
1,585,689 7,223,796 6,387,910
8,264,664 10,509,548 2,505,954
643,526 4,356,243 2,181,442
154,263 1,472,071 1,472,494
11,388,584 25,903,452 23,152,706
(5,081,731) (783,389) 463,927
4,171,328 4,191,328 -
- 1,055,954 -
(58,696) (687,109) (261,731)
1,241 1,241 17,785
4,113,873 4,561,414 (243,946)
(967,858) 3,778,025 219,981
1,510,824 1,513,028 2,396
(417) (1,651,539) (22,486)
542,549 3,639,514 199,891
739,706 78,810,208 10,210,327
$ 1,282,255 $ 82,449,722 $ 10,410,218
Business-Type Activities - Enterprise
Funds
See Notes to Financial Statements.
14 DRAFT
CITY OF REDONDO BEACH
Statement of Cash Flows
Proprietary Funds
Year Ended June 30, 2023
Cash Flows from Operating Activities:
Cash received from customers and users $ 7,024,049 $ 5,458,503 $ 5,486,967 Cash paid to suppliers for goods and services (1,158,656) (2,991,036) (101,839) Cash paid to employees for services (3,735,875) (1,764,767) (2,133,435) Net Cash Provided (Used) by Operating Activities 2,129,518 702,700 3,251,693 Cash Flows from Non-Capital
Financing Activities:
Cash transfers out - (1,650,733) (389)
Cash transfers in 1,787 417 -
Repayment received from other funds (57,876) - -
Payment made to other funds - - -
Principal paid on non-capital debt issued (326,802) (108,432) (109,937) Payment for cost of issuance - - -
Interest paid on non-capital debt (244,550) (81,110) (94,871) Cash received from other governments - - -
Net Cash Provided (Used) by
Non-Capital Financing Activities (627,441) (1,839,858) (205,197) Cash Flows from Capital
and Related Financing Activities:
Acquisition and construction of capital assets (4,450,097) (516,147) (4,435,155) Principal paid on capital debt - - (325,000)
Interest paid on capital debt - - (208,430)
Proceeds from sale of capital assets - - -
Net Cash Provided (Used) by
Capital and Related Financing Activities (4,450,097) (516,147) (4,968,585) Cash Flows from Investing Activities:
Interest received 475,067 345,704 174,692
Net Cash Provided (Used) by
Investing Activities 475,067 345,704 174,692
Net Increase (Decrease) in Cash
and Cash Equivalents (2,472,953) (1,307,601) (1,747,397) Cash and Cash Equivalents at Beginning of Year 12,516,274 3,103,143 20,791,766 Cash and Cash Equivalents at End of Year $ 10,043,321 $ 1,795,542 $ 19,044,369 Harbor
Tidelands Harbor Uplands Wastewater
Business-Type Activities - Enterprise Funds
See Notes to Financial Statements.
15 DRAFT
CITY OF REDONDO BEACH
Statement of Cash Flows
Proprietary Funds
Year Ended June 30, 2023
Harbor
Tidelands Harbor Uplands Wastewater
Business-Type Activities - Enterprise Funds
Reconciliation of Operating Income to Net Cash
Provided (Used) by Operating Activities:
Operating income (loss) $ 1,455,270 $ 1,958,864 $ 884,208 Adjustments to reconcile operating income (loss)
net cash provided (used) by operating activities:
Depreciation 435,229 424,344 458,235
(Increase) decrease in accounts receivable (273,558) (20,108) (1,735) (Increase) decrease in taxes receivable - - 55,220
(Increase) decrease in leases receivable 1,777,991 224,146 - (Increase) decrease in deferred outflow pension related items 7,128,453 2,068,004 2,336,287 (Increase) decrease in deferred outflow OPEB related items (11,979) (8,557) (9,601) (Increase) decrease in prepaid expense 30,000 - -
Increase (decrease) in accounts payable 1,659,901 95,988 1,325,076 Increase (decrease) in deposits payable - 15,483 -
Increase (decrease) in unearned revenue - - -
Increase (decrease) in claims and judgments - - -
Increase (decrease) in net pension liability (5,691,020) (2,486,868) (1,224,667) Increase (decrease) in OPEB liability 93,505 52,876 50,076 Increase (decrease) in deferred pension related items (2,238,534) (1,093,705) (654,148) Increase (decrease) in deferred OPEB related items (118,574) (50,372) (33,688) Increase (decrease) in deferred inflow lease related items (2,105,205) (515,925) - Increase (decrease) in compensated absences (11,961) 38,530 66,430 Total Adjustments 674,248 (1,256,164) 2,367,485
Net Cash Provided (Used) by
Operating Activities $ 2,129,518 $ 702,700 $ 3,251,693
Non-Cash Investing, Capital, and Financing Activities:
Net Amortization of Premium and Deferred Loss $ - $ - $ 547 Subscription financing - - -
Subscription assets aquired - - -
See Notes to Financial Statements.
16 DRAFT
CITY OF REDONDO BEACH
Statement of Cash Flows
Proprietary Funds
Year Ended June 30, 2023
Cash Flows from Operating Activities:
Cash received from customers and users
Cash paid to suppliers for goods and services
Cash paid to employees for services
Net Cash Provided (Used) by Operating Activities
Cash Flows from Non-Capital
Financing Activities:
Cash transfers out
Cash transfers in
Repayment received from other funds
Payment made to other funds
Principal paid on non-capital debt issued
Payment for cost of issuance
Interest paid on non-capital debt
Cash received from other governments
Net Cash Provided (Used) by
Non-Capital Financing Activities
Cash Flows from Capital
and Related Financing Activities:
Acquisition and construction of capital assets
Principal paid on capital debt
Interest paid on capital debt
Proceeds from sale of capital assets
Net Cash Provided (Used) by
Capital and Related Financing Activities
Cash Flows from Investing Activities:
Interest received
Net Cash Provided (Used) by
Investing Activities
Net Increase (Decrease) in Cash
and Cash Equivalents
Cash and Cash Equivalents at Beginning of Year
Cash and Cash Equivalents at End of Year
Governmental
Other ActivitiesEnterprise Internal
Funds Totals Service Funds
$ 6,142,271 $ 24,111,790 $ 23,604,897
(9,187,342) (13,438,873) (16,628,796)
(1,423,596) (9,057,673) (5,062,987)
(4,468,667) 1,615,244 1,913,114
(417) (1,651,539) (22,486)
1,510,824 1,513,028 2,396
- (57,876) -
884,888 884,888 -
(79,065) (624,236) -
- - (342,615)
(58,696) (479,227) (256,055)
3,273,935 3,273,935 -
5,531,469 2,858,973 (618,760)
(319,393) (9,720,792) (1,771,239)
- (325,000) (89,562)
- (208,430) (2,186)
1,240 1,240 18,029
(318,153) (10,252,982) (1,844,958)
- 995,463 -
- 995,463 -
744,649 (4,783,302) (550,604)
1,580,677 37,991,860 36,398,607
$ 2,325,326 $ 33,208,558 $ 35,848,003
Business-Type Activities -
Enterprise Funds
See Notes to Financial Statements.
17 DRAFT
CITY OF REDONDO BEACH
Statement of Cash Flows
Proprietary Funds
Year Ended June 30, 2023
Reconciliation of Operating Income to Net Cash
Provided (Used) by Operating Activities:
Operating income (loss)
Adjustments to reconcile operating income (loss)
net cash provided (used) by operating activities:
Depreciation
(Increase) decrease in accounts receivable
(Increase) decrease in taxes receivable
(Increase) decrease in leases receivable
(Increase) decrease in deferred outflow pension related items (Increase) decrease in deferred outflow OPEB related items (Increase) decrease in prepaid expense
Increase (decrease) in accounts payable
Increase (decrease) in deposits payable
Increase (decrease) in unearned revenue
Increase (decrease) in claims and judgments
Increase (decrease) in net pension liability
Increase (decrease) in OPEB liability
Increase (decrease) in deferred pension related items
Increase (decrease) in deferred OPEB related items
Increase (decrease) in deferred inflow lease related items Increase (decrease) in compensated absences
Total Adjustments
Net Cash Provided (Used) by
Operating Activities
Non-Cash Investing, Capital, and Financing Activities:
Net Amortization of Premium and Deferred Loss
Subscription financing
Subscription assets aquired
Governmental
Other ActivitiesEnterprise Internal
Funds Totals Service Funds
Business-Type Activities -
Enterprise Funds
$ (5,081,731) $ (783,389) $ 463,927
154,263 1,472,071 1,472,495
(162,495) (457,896) (11,736)
- 55,220 -
- 2,002,137 -
1,524,179 13,056,923 7,780,456
(5,042) (35,179) (3,658)
- 30,000 (4,915)
428,016 3,508,981 1,723,783
- 15,483 -
(2,087) (2,087) -
- - (3,316,793)
(853,711) (10,256,266) (4,161,862)
33,274 229,731 70,175
(469,314) (4,455,701) (1,967,402)
(34,912) (237,546) (138,887)
- (2,621,130) -
893 93,892 7,531
613,064 2,398,633 1,449,187
$ (4,468,667) $ 1,615,244 $ 1,913,114
$ - $ 547 $ -
- - (318,307)
- - 318,307
See Notes to Financial Statements.
18 DRAFT
CITY OF REDONDO BEACH
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2023
Custodial
Funds
Assets:
Pooled cash and investments $ 178,012 $ 1,426,199
Receivables:
Accounts 37,758 22,082
Accrued interest - 14,873
Total Assets 215,770 1,463,154
Liabilities:
Accrued interest - 121,496
Due to other governments - 2,443,621
Long-term liabilities:
Due in one year - 595,000
Due in more than one year - 12,406,131
Advances from City - 535,731
Total Liabilities - 16,101,979
Net Position:
Restricted for other purposes 215,770 (14,638,825)
Total Net Position $ 215,770 $ (14,638,825)
Private-Purpose
Trust Fund
Redevelopment
Obligation
Retirement Fund
See Notes to Financial Statements.
19 DRAFT
CITY OF REDONDO BEACH
Statement of Changes in Fiduciary Net Position
Fiduciary Funds
Year Ended June 30, 2023
Additions:
Charges for services $ - $ 262,386
RPTTF distributions - 2,698,872
Investment earnings - 42,039
Total Additions - 3,003,297
Deductions:
Interest expense - 242,993
Contributions to other governments - 812,381
Total Deductions - 1,055,374
Changes in Net Position - 1,947,923
Net Position:
Beginning of the year 215,770 (16,586,748)
End of the Year $ 215,770 $ (14,638,825)
Custodial Funds
Private-Purpose
Trust Fund
Redevelopment
Obligation
Retirement Fund
See Notes to Financial Statements.
20 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The basic financial statements of the City of Redondo Beach, California (City) have been prepared in conformity with generally accepted accounting principles (GAAP) as applied to governmental agencies. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The more significant of the City's accounting policies are described below.
A. Financial Reporting Entity
The City was incorporated on April 29, 1892, under the laws of the State of California and enjoys all the rights and privileges applicable to a Charter City. It is governed by an elected Mayor and a five-member council.
As required by GAAP, the financial statements present the City and its component units, entities for which the City is substantively the same governing body of the component unit’s governing body and there is either a financial benefit or burden relationship between the City and the component units. Blended component units, although legally separate entities are, in substance, part of the City's operations and data from these units are combined with data of the City. Each blended component unit has a June 30 year-end. The City had no discretely presented component units. The following entities are reported as blended component units:
The Parking Authority of the City of Redondo Beach (Parking Authority) was established on March 3, 1969, pursuant to the provisions of the Streets and Highway Code of the State of California. The principal purpose of the Parking Authority is to provide public off-street parking within the City. The Parking Authority serves all the citizens of the government and is governed by a board comprised of the government's elected council. The Parking Authority is considered a blended component unit due to the financial benefit or burden relationship the Parking Authority shares with the City as its financial transactions are reported in a Debt Service Fund. Separate financial statements are not prepared for this blended component unit.
The Redondo Beach Housing Authority (Housing Authority) was formed on June 2, 1975, for the purpose of providing affordable, decent housing for lower income residents of the City. The Housing Authority operates the Fair Housing and Section 8 housing programs. The Housing Authority serves all the citizens of the government and is governed by a board comprised of the government's elected council. The Housing Authority is considered a blended component unit due to the financial benefit or burden relationship the Housing Authority shares with the City as its financial transactions are reported in a Special Revenue Fund. Separate financial statements are not prepared for this blended component unit.
The Redondo Beach Public Financing Authority (Public Financing Authority), a joint powers authority, was formed on June 25, 1996, to provide financing for capital improvement projects. The Redevelopment Agency joined with the City to form the Public Financing Authority to operate rental property and issue bonds to provide funds for public capital improvements. The Public Financing Authority has the same governing board as the City, which also performs all accounting and administrative functions for the Public Financing Authority. The Public Financing Authority is considered a blended component unit due to the financial benefit or burden relationship the Public Financing Authority shares with the City as its financial transactions are reported in a Debt Service Fund. Separate financial statements are not prepared for this blended component unit.
The Redondo Beach Community Financing Authority (Community Financing Authority), a joint powers authority, was formed on January 31, 2012, to provide financing for capital improvement projects as the State’s elimination of the Redevelopment Agency, which was a member of the Public Financing Authority, created the need for a new financing authority. The Parking Authority joined with the City to form the Community Financing Authority. The Community Financing Authority has the same governing board as the City, which also performs all accounting and administrative functions for the Community Financing Authority. The Community Financing Authority is considered a blended component unit due to the financial benefit or burden relationship the Community Financing Authority shares with the City as its financial transactions are combined with the Public Financing Authority and reported in a Debt Service Fund. The Community Financing Authority does not issue separate financial statements. 21 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) B. Basis of Accounting and Measurement Focus
The accounts of the City 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, liabilities, fund equity, revenues, and expenditures or expenses, as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled.
Government - Wide Financial Statements
The City's government-wide financial statements include a Statement of Net Position and a Statement of Activities. These statements present summaries of governmental and business-type activities for the City accompanied by a total column. Fiduciary activities of the City are not included in these statements. These basic financial statements are presented on an "economic resources" measurement focus and the accrual basis of accounting. Accordingly, all of the City's assets, deferred outflows of resources, deferred inflows of resources, 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. The Statement of Activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Certain indirect costs are included in the program expenses reported for specific functions.
Certain types of transactions are reported as program revenues for the City in three categories:
Charges for services
Operating grants and contributions
Capital grants and contributions
Certain eliminations have been made in regard to interfund activities, payables and receivables. All internal balances in the Statement of Net Position have been eliminated except those representing balances between the governmental activities and the business-type activities, which are presented as internal balances and eliminated in the total primary government column. In the Statement of Activities, internal service fund transactions have been eliminated; however, those transactions between governmental and business-type activities have not been eliminated. The following interfund activities have been eliminated:
Due to/from other funds
Advances to/from other funds
Transfers in/out
Governmental Fund Financial Statements
Governmental fund financial statements include a Balance Sheet and a Statement of Revenues, Expenditures and Changes in Fund Balances for all major governmental funds and non-major funds aggregated. The City has presented all major funds that have met the applicable criteria.
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 Balances presents increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Under the 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. 22 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Revenues are recorded when received in cash, except for revenues subject to accrual (generally 60 days after year-end), which are recognized when due. The primary revenue sources, which have been treated as susceptible to accrual by the City, are property taxes, sales taxes, franchise taxes, special assessments, intergovernmental revenues and other taxes. Expenditures are recorded in the accounting period in which the related fund liability is incurred.
Unavailable revenues arise when potential revenues do not meet both the "measurable" and "available" criteria for recognition in the current period. Unearned revenues also 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 unavailable or unearned revenue is removed, and revenue is recognized.
The reconciliations of the Fund Financial Statements to the Government-Wide Financial Statements are provided to explain the differences created by the integrated approach of GASB Statement No. 34.
The City reports the following major governmental funds:
General Fund - The City's primary operating fund that accounts for all financial resources of the general government except those required to be accounted for in another fund. Other Intergovernmental Grants Special Revenue Fund - To account for federal, state and other governmental agencies grant funding that supplements local funding.
Low-Mod Income Housing Asset Special Revenue Fund - To account for all transferred housing assets of the dissolved Redevelopment Agency and funds generated from those housing assets.
Proprietary Fund Financial Statements
Proprietary fund financial statements include a Statement of Net Position, a Statement of Revenues, Expenses and Changes in Net Position, and a Statement of Cash Flows for each proprietary fund. A separate column representing internal service funds is also presented in these statements. However, internal service balances and activities have been combined with the governmental activities in the government-wide financial statements.
Proprietary funds are accounted for using the "economic resources" measurement focus and the accrual basis of accounting. Accordingly, all assets, deferred outflows of resources, liabilities, and deferred inflows of resources (whether current or noncurrent) are included on the Statement of Net Position. The Statement of Revenues, Expenses and Changes in Net Position presents increases (revenues) and decreases (expenses) in total 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. In these funds, receivables have been recorded as revenue and provisions have been made for uncollectible amounts.
Operating revenues in the proprietary funds are those revenues that are generated from the primary operations of the fund. All other revenues are reported as non-operating revenues. Operating expenses are those expenses that are essential to the primary operations of the fund. All other expenses are reported as non-operating expenses.
The City reports the following enterprise funds as major proprietary funds:
Harbor Tidelands Fund – To account for the operations of small boat harbor facilities available to the general public, including related pier activities. The use of this fund is restricted under the City Tideland Trust Agreement with the State of California.
Harbor Uplands Fund – To account for the operations of small boat harbor facilities available to the general public, including related pier activities. The use of this fund is subject only to the decisions of the City Council. 23 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Wastewater Fund – To account for the capital facility charge and a sewer user fee. The charges are designed to reimburse the City's wastewater system for the capital and maintenance and operations costs necessary for providing wastewater capacity to system users. These charges are associated with the expansion of the system required over time to address increases in wastewater flow generated by new development.
Fiduciary Fund Financial Statements
Fiduciary Funds are using the "economic resources" measurement focus and the accrual basis of accounting.
The City reports a private-purpose trust and a custodial fund. Private-purpose trust funds are used to report trust arrangements under which principal and income benefit individuals, private organizations, or other governments.
Custodial funds account for assets held by the city for other governments or individuals in a custodial capacity.
C. Cash, Cash Equivalents and Investments
The City pools its available cash for investment purposes. The City's cash and cash equivalents are considered to be cash on hand, demand deposits, and short-term investments with original maturity of three months or less from the date of acquisition. Cash and cash equivalents are combined with investments and displayed as Cash and Investments.
In accordance with GASB Statement No. 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools, highly liquid market investments with maturities of one year or less at time of purchase are stated at amortized cost. All other 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's investments are subject to credit risk with the full faith and credit of the State of California collateralizing these investments. In addition, these Structured Notes and Asset-Backed Securities are subject to market risk as to change in interest rates.
In accordance with GASB Statement No. 40, Deposit and Investment Risk Disclosures, certain disclosure requirements, if applicable, are provided for deposit and investment risk in the following areas:
Interest Rate Risk
Credit Risk
Overall
Custodial Credit Risk
Concentration of Credit Risk
Foreign Currency Risk
For purposes of the statement of cash flows of the proprietary fund types, cash and cash equivalents include all investments, as the City operates an internal cash management pool which maintains the general characteristics of a demand deposit account.
D. Restricted Cash and Investments
Certain restricted cash and investments are held by fiscal agents for the redemption of bonded debt, for acquisition and construction of capital projects, or to serve as collateral for debt. Cash and investments are also restricted for deposits held for others within the enterprise funds.
E. Prepaid Items
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items. The cost of prepaid items is recorded as expenditures/expenses when consumed rather than when purchased.
24 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) F. Interfund Transactions
Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either "due to/from other funds" (i.e., the current portion of interfund loans) or "advances to/from other funds" (i.e., the noncurrent portion of interfund loans)." Any residual balances outstanding between the governmental activities and business-type activities are reported in the governmental-wide financial statements as "internal balances." G. Capital Assets
In the Government-Wide Financial Statements, capital assets, which include land, buildings, right-to-use buildings, improvements, equipment, furniture, subscriptions and infrastructure assets (e.g., roads, sidewalks, and similar items), are reported in the applicable governmental or business-type activities. Capital assets are recorded at historical cost or estimated historical cost if actual cost is not available. Donated assets and capital assets received in a service concession are valued at their acquisition value rather than fair value. City policy has set the capitalization threshold for reporting capital assets at the following:
General Capital Assets $ 5,000
Infrastructure Capital Assets 25,000
Buildings, Paring Structures and Parking Lots 100,000
The City has chosen the Modified Approach for reporting of the Street Pavement Subsystem infrastructure assets, and as a result no depreciation is recorded for that system; instead, all expenditures made for these assets, except for additions and improvements, are expensed in the year incurred. For all other assets, depreciation is recorded on a straight-line basis over the useful lives of the assets as follows:
Asset Years
Buildings and Improvements 5-45
Equipment 5-20
Vehicles 4-20
Infrastructure 5-60
The City defines infrastructure as the physical assets that allow the City to function. These assets include:
Streets system
Site amenities such as parking and landscaped areas used by the City in the conduct of its business Underground utilities
Each major infrastructure system can be divided into subsystems. For example, the street system can be divided into concrete and asphalt pavements, concrete curb and gutters, sidewalks, medians, etc. Subsystem detail is not presented in these financial statements; however, the City maintains detailed information on these subsystems.
In May 2020, a physical assessment of all pavement segments was conducted to assess the existing surface condition of each of the individual pavement segments. Upon completion of the study, a Pavement Condition Index (PCI) was calculated for each segment in the City's pavement network to reflect the overall pavement condition.
Ratings ranged from 0 to 100. A PCI of 0 would correspond to badly deteriorated pavement with virtually no remaining life; a PCI of 100 would correspond to pavement with proper engineering design and construction at the beginning of its life cycle. During the year, the comprehensive survey is updated to reflect the pavement's current condition.
25 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) The following conditions were defined:
Condition Rating
Very Good 70-100
Good 50-69
Poor 25-49
Very Poor 0-24
In line with the Capital Improvement Program and as presented to the City Council on January 16, 2018, City policy is to achieve an average PCI rating of 75 for all streets beginning in fiscal year 2028. This rating allows minor cracking and raveling of the pavement along with minor roughness that could be noticeable to drivers traveling at posted speeds. For 2021, 2022 and 2023, the City's street system was rated at a PCI of 70, 69 and 68 on the average, respectively.
For a detailed description of the Modified Approach, see the Required Supplementary Information section of this report.
For all other infrastructure systems, the City elected to use the Basic Approach for infrastructure reporting. As such, the City records the assets at historical cost and depreciates them over their useful lives, and regularly evaluates them for impairment. Expenditures that extend the life of the asset are capitalized.
In the governmental fund financial statements, capital assets are not presented. Consequently, capital assets are a reconciling item and are shown in the Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position.
H. Interest Payable
In the government-wide financial statements, interest payable on long-term debt is recognized as the liability is incurred for governmental activities and business-type activities.
In the fund financial statements, governmental fund types do not recognize interest payable, while proprietary fund and fiduciary fund types recognize the interest payable when the liability is incurred.
I. Unearned/Unavailable Revenue
In the financial statements, unearned revenue is recognized for transactions in which revenue has not yet been earned, and unavailable revenue is recognized for transactions in which revenue is measurable but not available.
Typical transactions recorded as unearned revenues in the financial statements are prepaid charges for services, and grants received but not yet earned. Typical transactions recorded as unavailable revenues in the financial statements are long term loans receivable, and reimbursable grants that are not collected in the City’s availability period.
J. Compensated Absences Payable
Only the short-term liability for compensated absences (the amount due to employees for future absences, such as vacation and compensatory time, which are attributable to services already rendered) is reported as a current liability in the governmental funds and only if they have matured, for example, as a result of employee resignations and retirements; the long-term liability is reported in the government-wide financial statements. The short-term liability is the amount that will be liquidated with current financial resources and is expected to be paid during the next fiscal year. All of the liability for compensated absences applicable to proprietary funds is reported in those funds.
26 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Vacation pay is payable to employees at the time a vacation is taken or upon termination of employment.
Employees may accrue from two to three times their annual accrual rate. Upon termination an employee will be paid for any unused accrued vacation pay. Sick leave is payable when an employee is unable to work because of illness. Unused sick leave is forfeited upon termination.
K. Claims and Judgments Payable
The short-term and long-term claims are reported as liabilities in the Self-Insurance Program Internal Service Fund.
The short-term liability which will be liquidated with current financial resources is the amount of the settlement reached, but unpaid, related to claims and judgments entered.
L. Long-Term Debt
Government-Wide Financial Statements
Long-term debt and other long-term obligations are reported as liabilities in the appropriate activities. Bond premiums and discounts are amortized over the life of the bonds using the effective interest method. Bonds payable is reported net of the applicable bond premium or discount.
Fund Financial Statements
The fund financial statements do not present long-term debt. Consequently, long-term debt is a reconciling item and is shown in the Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position.
Bond premiums and discounts, as well as issuance costs, are recognized during the current period. Bond proceeds are reported as other financing sources net of the applicable premium or discount.
M. Pension Plans
For purposes of measuring the net pension liability, deferred outflows and inflows of resources related to pensions, and pension expense, information about the fiduciary net position and additions to/deductions from the fiduciary net position have been determined on the same basis as they are reported by the CalPERS Financial Office.
For this purpose, benefit payments (including refunds of employee contributions) are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value. CalPERS audited financial statements are publicly available reports that can be obtained at CalPERS’ website under Forms and Publications.
GASB 68 requires that the reported results must pertain to liability and asset information within certain defined timeframes. For this report, the following timeframes are used.
Valuation Date (VD) June 30, 2021
Measurement Date (MD) June 30, 2022
Measurement Period (MP) July 1, 2021 to June 30, 2022
N. Other Post-Employment Benefits (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the City’s plan (OPEB Plan), the assets of which are held by California Employers’ Retiree Benefit Trust (CERBT), and additions to/deductions from the OPEB Plan’s fiduciary net position have been determined by an independent actuary. For this purpose, benefit payments are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value.
27 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Generally accepted accounting principles require that the reported results must pertain to liability and asset information within certain defined timeframes. For this report, the following timeframes are used:
Valuation Date (VD) June 30, 2021
Measurement Date (MD) June 30, 2022
Measurement Period (MP) July 1, 2021 to June 30, 2022
Gains and losses related to changes in total OPEB liability and fiduciary net position are recognized in OPEB expense systematically over time. Amounts are first recognized in OPEB expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to OPEB and are to be recognized in future OPEB expense.
The recognition period differs depending on the source of the gain or loss:
Net difference between projected and actual
earnings on pension plan investments
5 years
All other amounts Expected average remaining service lifetime (EARL) (8.5 years at July 1, 2021)
O. Net Position
In the Government-Wide Financial Statements, net position is classified in the following categories:
Net Investment in Capital Assets - This amount consists of capital assets net of accumulated depreciation and reduced by outstanding debt attributed to the acquisition, construction, or improvement of the assets.
Restricted Net Position - This amount is restricted by external creditors, grantors, contributors, laws or regulations of other governments.
Unrestricted Net Position - This amount is all net position that does not meet the definition of "net investment in capital assets" or "restricted net position."
P. Fund Balances
In the Governmental Fund Financial Statements, fund balances are classified in the following categories:
Nonspendable – Nonspendable fund balances are items that are not expected to be converted to cash, such as prepaid items and inventories, or items that are required to be maintained intact, such as principal of an endowment or revolving loan funds.
Restricted - Restricted fund balances include amounts that can be spent only for the specific purposes stipulated by external resources providers, such as grant providers, constitutionally, or through enabling legislation.
Effectively, restrictions may be changed or lifted only with the consent of resource providers.
Committed - Committed fund balances include amounts that can be used only for the specific purposes when the City Council passes a resolution that places specific constraints on how the resources may be used. The City Council can modify or rescind the resolution at any time through passage of an additional resolution.
Assigned - Assigned fund balances comprise amounts intended to be used by the government for specific purposes, but are neither restricted nor committed. Intent is expressed when the City Council approves which resources should be assigned to expenditures of particular purposes during the adoption of the annual budget. The City Manager uses that information to determine whether those resources should be classified as assigned or unassigned for presentation in the City’s fund financial statements. 28 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Unassigned - Unassigned fund balance is a residual (surplus) classification used for the General Fund only and includes amounts not contained in the other classifications. Unassigned amounts in the General Fund are technically available for any purpose. If a governmental fund, other than the General Fund, has a fund balance deficit, it will be reported as a negative amount in the unassigned classification in that fund.
Q. Spending Policy
Government-Wide Financial Statements and the Proprietary Fund Financial Statements When an expense is incurred for purposes for which both restricted and unrestricted net position are available, the City's policy is to apply restricted net position first.
Governmental Fund Financial Statements
When expenditures are incurred for purposes for which all restricted, committed, assigned and unassigned fund balances are available, the City's policy is to apply in the following order, except for instances wherein an ordinance specifies the source:
Restricted
Committed
Assigned
Unassigned
R. Property Taxes
Under California law, property taxes are assessed and collected by the counties on up to 1% of assessed property value, plus other increases approved by the voters. Property taxes collected are pooled and then allocated to the cities based on complex formulas.
January 1 Lien Date
June 30 Levy Date
November 1 and February 1 Due Dates
December 10 and April 10 Collection Date
S. Use of Estimates
The preparation of the basic financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities. In addition, estimates affect the reported amount of expenses. Actual results could differ from these estimates and assumptions.
T. Deferred Outflows/Inflows of Resources
In addition to assets, the statement of financial position 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 a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The City only has three items that qualify for reporting in this category. One is the deferred charge on refunding reported in the government-wide statement of net position. A deferred charge on refunding results from the difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunding or refunded debt. Secondly, the City also has deferred outflows related to pensions, which arises only under a full accrual basis of accounting. Accordingly, this item (pension related items), is reported only in the government-wide statement of net position. This includes 29 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) pension contributions subsequent to the measurement date of the net pension liability and other amounts (see Note 11), which are amortized by an actuarial determined period. Thirdly, the City has deferred outflows related to Other Post-Employment Benefits (OPEB), which include contributions subsequent to the measurement date of the total OPEB liability and other amounts:
In addition to liabilities, the statement of financial position 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 assets that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The City has several items that qualify for reporting in this category:
1. Unavailable revenue reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from grant revenues. These amounts are deferred and recognized as an inflow of resources in the period when they become available.
2. Pension and OPEB related deferred inflows are reported only on the Statement of Net Position. The government reports deferred inflows of resources related to items arising from certain changes in the net pension liability, net pension asset, net OPEB asset or net OPEB liability. Deferred inflows and outflows of resources related to changes in the net pension liability, net pension asset, net OPEB asset or net OPEB liability are recognized systematically over time. Amounts are first recognized in the year the change occurs. The remaining amounts are to be recognized in future periods. The recognition period differs depending on the source of the change, and the changes are currently amortized over 5 years or the average remaining service life time.
3. A deferred inflow of resources related to leases is reported for the value of lease receivable payments to be recognized as an inflow of resources in a systematic and rational manner over the term of the lease agreements.
NOTE 2: STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
Deficit Fund Balance
The following funds had a deficit balance as of June 30, 2023:
The deficit fund balances are expected to be recovered through grant and other reimbursement revenues. For the Private-Purpose Trust Fund, deficit will be recovered from future payments from the County Redevelopment Property Tax Trust Fund.
Major Funds
Other Intergovernmental Grants $ (6,053,354)
Non-Major Funds
Local Transportation Article 3 (907)
Community Development Block Grant (27,053)
Internal Service Funds
Self-Insurance Program (10,337,391)
Private-Purpose Trust Fund (14,638,825)
30 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 3: CASH AND INVESTMENTS
Cash and investments are presented on the Statement of Net Position as follows at June 30, 2023:
Fiduciary Funds
Governmental Business-type Statement of
Activities Activities Total Net Position Total
Cash and investments 96,832,814 $ 33,208,159 $ 130,040,973 $ 1,604,211 $ $ 131,645,184 Restricted cash and investments
with fiscal agents 1,303,816 399 1, - 304,215 1, 304,215 $ 33,208,558 98,136,630 $ 131,345,188 $ 1,604,211 $ $ 132,949,399 Government-Wide Statement of Net Position
Cash, cash equivalents, and investments consisted of the following at June 30, 2023:
Cash and cash equivalents:
Petty cash $ 12,800
Demand deposits - City 18,190,112
Demand deposits - Successor Agency 1,052,374
Total cash and cash equivalents 19,255,286
Investments:
Local Agency Investment Fund (LAIF) - City 1,254,519
Local Agency Investment Fund (LAIF) - Successor Agency 1,865,614 Negotiable certificates of deposit 963,862
Money market mutual funds 8,931,843
Corporate Bonds 8,770,250
US Government Securities 35,806,770
Federal Agency Securities 54,797,040
Total investments 112,389,898
Total cash and investments 131,645,184
Cash and investments with fiscal agents 1,304,215
Total $ 132,949,399
31 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 3: CASH AND INVESTMENTS (CONTINUED)
A. Cash Deposits
The City 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 and 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 agents is credited directly to the related fund.
B. Investments
Under the provisions of the City's investment policy, and in accordance with California Government Code, the following investments are authorized:
United States Treasury Bills, Notes and Bonds
Obligations issued by the Federal Government
Bankers' Acceptances with a maturity of 180 days or less Time Certificates of Deposits
Negotiable Certificates of Deposit
Commercial Paper with a maturity of 270 days or less
Local Agency Investment Fund (LAIF) limited to $65,000,000 by LAIF Medium-Term Notes (5 year maximum) of Domestic Corporations or Depository Institutions Mutual Funds
Guaranteed Investment Contracts not to exceed $5 million annually Certificate of Deposit Placement Services
Collateralized Bank Deposits
Supranationals
The City investment policy applies to all financial assets, investment activities and debt issues of the City (including funds which are invested by trustees appointed under debt trust indentures, with direction from the City Treasurer).
The City is a participant in LAIF which is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. The City's investments with LAIF at June 30, 2023, include a portion of the pool funds invested in Structured Notes and Asset-Backed Securities.
Structured Notes - Debt securities (other than asset-backed securities) whose cash flow characteristics (coupon rate, redemption amount, or stated maturity) depend upon one or more indices and/ or that have embedded forwards or options.
Asset-Backed Securities - Generally mortgage-backed securities that entitle their purchasers to receive a share of the cash flows from a pool of assets such as principal and interest repayments from a pool of mortgages (for example, Collateralized Mortgage Obligations) or credit card receivables.
As of June 30, 2023, the City and the Successor Agency had $1,865,614 invested in LAIF, which had invested
0.201% of the pool investment funds in Structured Notes and Mortgage-Backed Securities. The LAIF fair value factor of 0.984828499 was used to calculate the fair value of the investments in LAIF.
C. Deposit and Investment Risk
Credit Risk
The City's investment policy limits investments in medium-term notes (MTN's) to those rated "A" or higher by Standard and Poor's (S&P) or “A2” or higher by Moody's. As of June 30, 2023, all MTN's were rated "A2" or higher by Moody's. As of June 30, 2023, the City's Federal Agency investments were rated "AA+" by Moody's 32 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 3: CASH AND INVESTMENTS (CONTINUED)
and “Aaa” by S&P. All securities were investment grade and were in accordance with State and City law.
Investments in U.S. government securities are not considered to have credit risk; therefore, their credit quality is not disclosed. As of June 30, 2023, the City's investments in external investment pools are unrated.
Custodial Credit Risk
The custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover deposits or will not be able to recover collateral securities that are in the possession of an outside party.
The carrying amounts of the City's cash deposits were $19,242,486 at June 30, 2023. Bank balances at June 30, 2023, were $19,887,674 which were fully insured or collateralized with securities held by the pledging financial institutions in the City's name as discussed below.
The California Government Code requires California banks and savings and loan associations to secure the City'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 City's name.
The fair value of pledged securities must equal at least 110% of the City's cash deposits. California law also allows institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the City's total cash deposits. The City may waive collateral requirements for cash deposits which are fully insured up to $250,000 by the Federal Deposit Insurance Corporation. The City, however, has not waived the collateralization requirements.
Concentration of Credit Risk
The City's investment policy imposes restrictions on the maximum percentage it can invest in a single type of investment. Investments in Federal Agencies have the implied guarantee of the United States government.
While all the City's investments are in compliance with the City's investment policy as of June 30, 2023, in accordance with GASB Statement No. 40, if a City has invested more than 5% of its total investments in any one issuer, they are exposed to concentration of credit risk. Investments guaranteed by the U.S. government and investments in mutual funds and external investment pools are excluded from this requirement.
As of June 30, 2023, the City has invested more than 5% of its total investment value with the following issuers:
% of Total
Investments
Federal Home Loan Bank 17,681,110 $ 16%
Federal Farm Credit Bank 18,229,400 16%
Federal National Mortgage Association 4,752,730 4%
Federal Home Loan Mortgage Corporation 14,133,800 13%
$ 49% 54,797,040
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CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 3: CASH AND INVESTMENTS (CONTINUED)
Interest Rate Risk
The City's investment policy limits investment maturities as a means of managing its exposure to fair value losses arising from increasing interest rates. The City's investment policy states that at least 50% of the City's portfolio shall mature in three years or less; and at least 25% in one year or less. The only exception to these maturity limits shall be the investment of the gross proceeds of tax-exempt bonds. The City has elected to use the segmented time distribution method of disclosure for its interest rate risk. As of June 30, 2023, the City had the following investments and remaining maturities:
Fair Value Measurements
GASB Statement No. 72, Fair Value Measurements and Application, establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy consists of three broad levels: Level 1 inputs consist of quoted prices (unadjusted) for identical assets and liabilities in active markets that a government can access at the measurement date, Level 2 inputs consist of inputs other than quoted prices that are observable for an asset or liability, either directly or indirectly, and Level 3 inputs have the lowest priority and consist of unobservable inputs for an asset or liability.
Fair Value Hierarchy
The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset.
Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs.
Investment Types Up to 1 year 1 to 2 years 2 to 3 years 3 to 5 years Fair Value External Investment Pools - $ 3,120,133 $ - $ - $ 3,120,133 - $ Local Agency Investment Fund
Negotiable certificate of deposits 726,442 237,420 - - 963,862 US Treasury Notes 8,915,950 1,898,900 20,534,480 4,457,440 35,806,770 Federal Agencies
Federal Farm Credit Bank 10,414,450 2,883,100 4,931,850 - 18,229,400 Federal Home Loan Bank 6,733,010 - 10,948,100 - 17,681,110 Federal Home Loan Mortgage Corporation - - 14,133,800 - 14,133,800 Federal National Mortgage Association 4,752,730 - - 4,752,730 - Money Market 8,931,843 - - 8,931,843 -
Corporate Bonds 6,910,590 1,859,660 - 8,770,250 -
Total Investments $ 39,019,408 $ 18,364,820 $ 20,534,480 $ 34,471,190 $ 112,389,898 Investment Maturities
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CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 3: CASH AND INVESTMENTS (CONTINUED)
The following table presents the balances of the assets measured at fair value on a recurring basis as of June 30, 2023.
Investments classified in Level 1 of the fair value hierarchy are valued using prices quoted in active markets for those securities. Investments classified in Level 2 of the fair value hierarchy are valued using specified fair value factors. Federal Agency Securities classified in Level 2 of the fair value hierarchy are valued using institutional bond quotes.
NOTE 4: RECEIVABLES
The following is a summary of receivables net of allowances for uncollectible amounts at June 30, 2023:
Investments by Fair Value Level Total Level 1 Level 2 Level 3 US Treasury Notes $ 35,806,770 $ 35,806,770 $ - $ -
Federal Farm Credit Bank 18,229,400 18,229,400 - -
Federal Home Loan Bank 17,681,110 17,681,110 - -
Federal Home Loan Mortgage Corporation 14,133,800 14,133,800 - - Federal National Mortgage Association 4,752,730 4,752,730 - - Corporate Bonds 8,770,250 8,770,250 - -
Money Market 8,931,843 8,931,843 - -
Negotiable Certificates of Deposit 963,862 963,862 - -
Total Investments by Fair Value Level 109,269,765 $ 44,738,613 $ 64,531,152 $ - Investments measured at Net Asset Value
Local Agency Investment Fund (LAIF) 3,120,133
Total Investments $ 112,389,898
Fair Value Measurement Using
Fiduciary
Funds
Governmental Business-Type Statement of
Activities Activities Net Position Total
Accounts Receivable 2,879,572 $ 1, $ 59,840 325,097 $ 4, $ 264,509 Taxes receivable 5,834,434 - 182,197 6, 016,631
Accrued interest receivable 473,279 254,293 14,873 742,445 Notes and loans receivable 2,842,962 - 2, - 842,962
Leases receivable 5,221,162 69,023,358 74, - 244,520
$ 17,251,409 $ 70,784,945 $ 74,713 $ 88,111,067
Government-wide
Statement of Net Position
35 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 4: RECEIVABLES (CONTINUED)
At June 30, 2023, the Fund Financial Statements show the following receivables:
A. Accounts Receivable
Accounts receivable consisted of amounts accrued in separate funds in the ordinary course of operations. The total amount of accounts receivable for each major fund and non-major fund in the aggregate as of June 30, 2023, was as follows:
B. Accrued Interest Receivable
Interest receivable consists of interest from investments pooled by the City and is distributed among the funds according to their ending cash balances. The interest receivable as of June 30, 2023, was as follows:
Governmental Funds:
General Fund 2,257,139 $
Other Intergovernmental Grants 429,000
Remaining Governmental Funds 130,167
Total Governmental Funds 2,816,306
Proprietary Funds:
Harbor Tidelands 625,024
Harbor Uplands 354,050
Wastewater 21,048
Other Non-major Enterprise Funds 324,975
Internal Service Funds 63,266
Total proprietary funds 1,388,363
Total 4,204,669 $
Governmental Funds:
General Fund 415,855 $
Remaining Governmental Funds 57,424
Total Governmental Funds 473,279
Proprietary Funds:
Harbor Tidelands 115,580
Harbor Uplands 41,648
Wastewater 97,065
Total proprietary funds 254,293
Total 727,572 $
36 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 4: RECEIVABLES (CONTINUED)
C. Taxes Receivable
At June 30, 2023, the City had the following taxes receivable:
D. Notes and Loans Receivable
At June 30, 2023, the City had the following notes and loans receivable:
Home Rehabilitation Loans
At June 30, 2023, the City was owed, in its Low and Moderate Income Housing Asset Special Revenue Fund, $389,992 for various home rehabilitation loans made by the City. The terms of repayment vary. Because the notes do not meet the City's availability criteria for revenue recognition, the City has classified the revenue related to these loans as deferred inflows of resources in the governmental funds. Revenue is recognized in the year of repayment. All loans are secured by trust deeds.
Housing Assistance Loans
At June 30, 2023, the City was owed, in its Community Development Block Grant Special Revenue Fund, $326,227 for various housing assistance loans made by the City. The terms of repayment vary. Because the notes do not meet the City's availability criteria for revenue recognition, the City has classified the revenue related to these loans as deferred inflows of resources. Revenue is recognized in the year of repayment. All loans are secured by trust deeds.
Non-Major
General Governmental Wastewater Solid Waste
Fund Funds Fund Fund Total
Type of Taxes
Property Taxes 1,137,855 $ 455,805 $ 82,563 $ 99,634 $ 1,775,857 $ Sales Taxes 2,020,322 - - - 2,020,322
Transient Occupancy Taxes 1,058,232 - - - 1,058,232
Utility Users Taxes 692,023 - - - 692,023
Franchise Taxes 267,157 - - - 267,157
Transfer Taxes 203,040 - - - 203,040
Total Taxes 5,378,629 $ $ 455,805 $ 82,563 $ 99,634 $ 6,016,631 Governmental Funds Proprietary Funds
Low-Mod Non-Major
General Income Governmental
Fund Housing Funds Total
Home Rehabilitation Loans - $ 389,992 $ - $ 389,992 $
Housing Assistance Loans - - 326,227 326,227
Senior Housing Program - 2,104,904 - 2,104,904
Computer Loan Program 21,839 - - 21,839
Total 21,839 $ 2,494,896 $ 326,227 $ 2,842,962 $
Governmental Funds
37 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 4: RECEIVABLES (CONTINUED)
Senior Housing Program
On June 21, 1995, the Agency loaned $2,200,000 to the Corporate Fund for Housing (a California non-profit public benefit corporation) for the McCandless senior housing complex. The loan term is for 45 years and bears interest at 2% per annum. Any portion of the Agency loan remaining unpaid upon the 45th anniversary of completion will be forgiven. Repayments will be made from residual receipts of the housing complex. The loan is secured by the Agency Deed of Trust. At June 30, 2023, the loan receivable included accrued interest of $55,000.
Computer Loan Program
The City has a computer loan program for employees to purchase computers. The maximum loan amount per employee is $1,500 with a repayment term maximum of two years. Repayments from the employees are made through payroll deductions. At June 30, 2023, the loan receivable balance was $21,839.
NOTE 5: LEASES
Leases are financings of the right to use an underlying asset. 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.
A. Leases Receivable and Deferred Inflows of Resources
The City entered into 40 leases as a Lessor for the use of various pieces of land and building. The terms range from 2 to 90 year beginning on the contract commencement date. As of June 30, 2023, the City reported a lease receivable of$74,244,520, $5,221,162 for governmental funds and $69,023,358 for proprietary funds, respectively.
The lessees were required to make monthly payments in fiscal year 2023 ranging from $788 to $105,400. The leases have interest rates ranging from 0.218% to 2.217%. The value of the deferred inflow of resources as of June 30, 2023, was $73,096,571, $5,156,539 for governmental funds and $67,940,032 for proprietary funds respectively, and the City recognized lease revenue of $4,577,398, $266,196 for governmental funds and $4,311,204 for proprietary funds, respectively. The lessees have various extension options, ranging from one 12-month option to two 60-month options. Variable and other miscellaneous payments are not included in the amount receivable.
38 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 5: LEASES (CONTINUED)
The following is a schedule, by year, of minimum future lease rentals on non-cancellable operating leases as of June 30, 2023:
Fiscal Year
Lease
Receivable
Interest
Income
Minimum Future
Rental Revenue
2024 437,852 $ 75,753 $ $ 513,605
2025 357,334 71,636 428,971
2026 361,387 67,584 428,971
2027 365,485 63,485 428,971
2028 317,448 59,361 376,808
2029 - 2033 100,881 284,119 385,000
2034 - 2038 109,851 275,148 385,000
2039 - 2043 119,620 265,380 385,000
2044 - 2048 130,257 254,743 385,000
2049 - 2053 141,840 243,160 385,000
2054 - 2058 154,453 230,547 385,000
2059 - 2063 168,187 216,813 385,000
2064 - 2068 183,143 201,857 385,000
2069 - 2073 199,428 185,571 385,000
2074 - 2078 217,162 167,837 385,000
2079 - 2083 236,473 148,526 385,000
2084 - 2088 257,501 127,498 385,000
2089 - 2093 280,399 104,601 385,000
2094 - 2098 305,333 79,667 385,000
2099 - 2103 332,484 52,515 385,000
2104 - 2108 362,050 22,950 385,000
2109 - 2110 82,593 824 83,417
Total 5,221,162 $ 3,199,574 $ 8,420,735 $
Governmental Activities
Fiscal Year
Lease
Receivable
Interest
Income
Minimum Future
Rental Revenue
2024 3,842,702 $ 1,081,463 $ 4,924,165 $
2025 3,748,520 1,035,324 4,783,844
2026 3,795,048 988,751 4,783,799
2027 3,133,237 942,346 4,075,583
2028 1,779,170 904,716 2,683,886
2029 - 2033 7,654,483 4,149,028 11,803,512
2034 - 2038 6,156,199 3,582,148 9,738,346
2039 - 2043 6,556,406 3,046,244 9,602,651
2044 - 2048 7,139,355 2,463,296 9,602,651
2049 - 2053 7,774,135 1,828,516 9,602,651
2054 - 2058 8,465,356 1,137,295 9,602,651
2059 - 2063 6,748,275 425,048 7,173,323
2064 - 2068 2,108,649 101,651 2,210,300
2069 - 2073 121,823 607 122,430
Total 69,023,358 $ $ 21,686,433 $ 90,709,791
Business-Type Activities
39 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 5: LEASES (CONTINUED)
B. Lease Payable and Right to Use Lease Assets
On 07/01/2021, City of Redondo Beach, CA entered into a 102-month lease as Lessee for the use of 1922 Artesia Boulevard - Community Services Dept Building - Chuka. An initial lease liability was recorded in the amount of $2,245,558. As of 06/30/2023, the value of the lease liability is $1,754,910. The City of Redondo Beach, CA is required to make monthly fixed payments of $20,798. The lease has an interest rate of 0.4570%. The buildings estimated useful life was 0 months as of the contract commencement. The value of the right to use asset as of 06/30/2023 of $2,245,558 with accumulated amortization of $528,367 is included with Buildings on the Lease Class activities table found below. City of Redondo Beach, CA has 1 extension option(s), each for 60 months.
The right to use leased assets at June 30, 2023, include the following:
Future principal and interest requirements to maturity for the lease liability are as follows:
Amount of
Leased Capital Accumulated
Lease Underlying Asset Assets Amortization
Community Service Department Building 2,245,558 $ 528,367 $ Fiscal Year
Principal
Payments
Interest
Payments
Total
Payments
2024 253,481 $ 7,492$ $ 260,973
2025 259,349 6,321 265,670
2026 265,328 5,124 270,452
2027 271,422 3,899 275,320
2028 277,631 2,645 280,276
2029 - 2030 427,699 1,555 429,254
Total 1,754,910 $ $ 27,036 $ 1,781,945
Governmental Activities
40 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 6: SUBSCRIPTIONS
For the year ended June 30, 2023, the financial statements include the adoption of GASB Statement No. 96, Subscription-Based Information Technology Arrangements. The primary objective of this statement is to enhance the relevance and consistency of information about governments' subscription activities. This statement establishes a single model for subscription accounting based on the principle that subscriptions are financings of the right to use an underlying asset. Under this Statement, an organization is required to recognize a subscription liability and an intangible right-to-use subscription asset.
As of June 30, 2023, the City has 17 subscription-based information technology arrangements (SBITA) for the use of various software. The City is required to make principal and interest payments through fiscal year 2030. An initial lease liability was recorded in the amount of $1,298,779. As of June 30, 2023, the value of the subscription liability was $985,983. The subscriptions have interest rates ranging from 1.7103% to 3.3050%. The value of the subscription asset at June 30, 2023 is $1,422,465 with accumulated amortization of $245,987.
The subscription assets at June 30, 2023, include the following:
Future principal and interest requirements to maturity for the subscription liability are as follows:
NOTE 7: INTERFUND TRANSACTIONS
A. Government-Wide Financial Statements
Internal Balances: At June 30, 2023, the City had the following internal receivables and payables for covering cash shortfalls:
Subscription Accumulated
Asset class Asset Value Amortization
Software 1,422,465 $ 245,987 $
Fiscal Year
Principal
Payments
Interest
Payments
Total
Payments
2024 318,312 $ $ 24,347 $ 342,659
2025 224,344 17,259 241,602
2026 180,668 11,312 191,981
2027 106,027 6,392 112,419
2028 77,422 3,618 81,040
2029 - 2030 79,210 1,830 81,040
Total 985,983 $ $ 64,757 $ 1,050,740
Governmental Activities
Internal Balances
Receivable
Governmental
Activities
Internal Balances Payable
Business-Type Activities 1,175,456 $
41 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 7: INTERFUND TRANSACTIONS (CONTINUED)
Transfers:
The City had the following transfers as of June 30, 2023:
B. Fund Financial Statements
Due to/from Other Funds
The City had the following due to/from other funds as of June 30, 2023:
The $5,739,212 due to other funds in the Other Intergovernmental Grants Fund is to cover negative cash balances.
The $582,213 due to other funds in the Low-Mod Income Housing Fund is due to the General Fund for housing compliance services.
Of the $5,018,206 due to other funds in Other Governmental Funds, $3,866,527 is due to the Capital Improvement Projects fund to cover project expenditures, $109,478 is due to the General Fund for expenditures made on behalf of the Public Financing Authority, $292,173 is for Kincaids rental income passed through to the Harbor Tidelands Fund, $723,593 is due to the General for expenditure made on behalf of the Housing Authority, and $25,528 and $907 are due to the General Fund to cover negative cash balance in the Community Development Block Grant fund and Local Transportation Article 3 fund respectively.
The $544,986 due to other funds in the Harbor Tidelands Fund is to cover the obligations of the Public Financing Authority (PFA) including a loan payoff and any excess of the Kincaid’s Restaurant rental income.
Transfers In
Business-Type
Activities
Transfers Out
Governmental Activities 295,271 $
General
Other
Governmental
Due to Other Funds Fund Funds Total
Governmental funds:
Other Intergovernmental Grants 5,739,212 $ $ - $ 5,739,212 - $ Low-Mod Income Housing 582,213 - 582,213 -
Other Governmental Funds 859,506 3,866,527 292,173 5,018,206 Enterprise Funds:
Harbor Tidelands 544,986 - 544,986 -
Transit 922,643 - 922,643 -
Total $ 8,103,574 $ 4,411,513 $ 292,173 $ 12,807,260
Due from Other Funds
Governmental Funds Enterprise Funds
Harbor Tidelands
42 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 7: INTERFUND TRANSACTIONS (CONTINUED)
Transfers
The City had the following transfers as of June 30, 2023:
Of the $14,343,215 transfer from the General Fund, $14,338,934 was to fund debt service payments.
The $1,510,726 transfer from the non-major governmental funds to the Other Enterprise Fund for a transit subsidy.
The $1,650,733 transfer from the Harbor Tidelands Enterprise Fund to the General Fund to reimburse rental payments.
NOTE 8: CAPITAL ASSETS
The City elected to use the "Modified Approach" as defined by GASB Statement No. 34 for infrastructure reporting for its street pavement system. As a result, no accumulated depreciation or depreciation expense has been recorded for this system. A more detailed discussion of the "Modified Approach" is presented in the Required Supplementary Information section of this report. All other capital assets including other infrastructure systems were reported using the Basic Approach whereby accumulated depreciation and depreciation expense have been recorded.
43 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 8: CAPITAL ASSETS (CONTINUED)
At June 30, 2023, the City's capital assets consisted of the following:
Governmental Business-Type
Activities Activities Total
Non-depreciable assets:
Land 16,522,947 $ 20,323,255 $ 36,846,202 $
Construction in progress 42,314,513 10,289,560 52,604,073 Infrastructure-streets 54,054,036 - 54,054,036
Total non-depreciable assets 112,891,496 30,612,815 143,504,311 Depreciable assets:
Buildings and improvements 58,523,343 45,184,647 103,707,990 Right-to-use buildings 2,245,558 - 2,245,558
Right-to-use subscriptions 1,422,465 - 1,422,465
Furniture and equipment 13,730,204 1,094,505 14,824,709 Automotive equipment 19,603,617 3,698,852 23,302,469
Infrastructure 102,696,119 33,634,671 136,330,790
Total depreciable assets 198,221,306 83,612,675 281,833,981 Less accumulated depreciation for:
Buildings and improvements 29,849,247 22,589,621 52,438,868 Right-to-use buildings 528,367 - 528,367
Right-to-use subscriptions 245,987 - 245,987
Furniture and equipment 10,230,226 989,771 11,219,997
Automotive equipment 15,170,169 2,277,921 17,448,090
Infrastructure 62,709,906 14,611,721 77,321,627
Total accumulated depreciation 118,733,902 40,469,034 159,202,936 Total depreciable assets, net 79,487,404 43,143,641 122,631,045 Total capital assets, net 192,378,900 $ 73,756,456 $ 266,135,356 $ 44 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 8: CAPITAL ASSETS (CONTINUED)
The following is a summary of changes in the capital assets for governmental activities during the fiscal year:
Depreciation expense was charged to functions/programs of governmental activities for the fiscal year ended June 30, 2023, as follows:
Balance at Balance at
June 30, 2022 Additions Deletions Transfers June 30, 2023 Non-depreciable assets:
Land $ 16,522,947 $ - $ - $ 16,522,947 - $
Construction in progress 25,823,514 16,903,385 (412,386) - 42,314,513 Infrastructure - streets 54,054,036 - - 54,054,036 -
Total non-depreciable assets 96,400,497 16,903,385 (412,386) - 112,891,496 Depreciable assets:
Buildings and improvements 58,117,371 218,838 187,134 - 58,523,343 Right-to-use buildings 2,245,558 - - 2,245,558 -
Right-to-use subscriptions 1,422,465 - - 1,422,465 -
Furniture and equipment 13,326,744 414,689 (11,229) 13,730,204 - Automotive equipment 18,247,872 2,561,130 (1,205,385) 19,603,617 - Infrastructure 99,670,237 2,800,630 225,252 - 102,696,119 Total depreciable assets 191,607,782 7,417,752 (1,216,614) 412,386 198,221,306 Less accumulated depreciation for:
Buildings and improvements 28,216,727 1,632,520 - 29,849,247 - Right-to-use buildings 264,926 263,441 - 528,367 -
Right-to-use subscriptions 245,987 - - 245,987 -
Furniture and equipment 9,761,089 480,366 (11,229) 10,230,226 - Automotive equipment 14,739,373 1,635,937 (1,205,141) 15,170,169 - Infrastructure 61,074,620 1,635,286 - 62,709,906 -
Total accumulated depreciation 114,056,735 5,893,537 (1,216,370) 118,733,902 - Total depreciable assets, net 77,551,047 1,524,215 (244) 412,386 79,487,404 Governmental activities capital assets, net 173,951,544 $ $ 18,427,600 $ (244) $ 192,378,900 - $ General Government
General Government 469,202 $
Public Safety 250,768
Public Works 2,692,697
Cultural and Leisure Services 1,008,376
Internal Services Funds
Vehicle Replacement 1,066,247
Building Occupancy 11,750
Information Technology 141,476
Emergency Communications 230,330
Major Facilities Repair 22,691
Total Depreciation and Amortization Expense 5,893,537 $ 45 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 8: CAPITAL ASSETS (CONTINUED)
The following is a summary of changes in the capital assets for business-type activities for the year ended June 30, 2023:
Depreciation expense for business-type activities for the fiscal year ended June 30, 2023, was charged as follows:
In the governmental fund financial statements, capital assets are not presented. Consequently, capital assets are a reconciling item and are shown in the Reconciliation of the Governmental Funds Balance Sheet to the Government-Wide Statement of Net Position.
Balance at Balance at
June 30, 2022 Additions Deletions Transfers June 30, 2023 Non-depreciable assets:
Land $ 20,323,255 $ - $ - $ 20,323,255 - $
Construction in progress 7,068,218 4,882,769 (1,661,427) - 10,289,560 Total non-depreciable assets 27,391,473 4,882,769 (1,661,427) - 30,612,815 Depreciable assets:
Buildings and improvements 39,016,662 4,506,558 1,661,427 - 45,184,647 Furniture and equipment 1,082,431 12,074 - 1,094,505 -
Automotive equipment 3,601,229 319,393 (221,770) 3,698,852 - Infrastructure 33,634,671 - - 33,634,671 -
Total depreciable assets 77,334,993 4,838,025 (221,770) 1,661,427 83,612,675 Less accumulated depreciation for:
Buildings and improvements 21,743,313 846,308 - 22,589,621 - Furniture and equipment 975,251 14,520 - 989,771 -
Automotive equipment 2,346,350 153,341 (221,770) 2,277,921 - Infrastructure 14,153,819 457,902 - 14,611,721 -
Total accumulated depreciation 39,218,733 1,472,071 (221,770) 40,469,034 - Total depreciable assets, net 38,116,260 3,365,954 1,661,427 - 43,143,641 Business-type activities capital assets, net 65,507,733 $ $ 8,248,723 $ - $ 73,756,456 - $ Harbor Tidelands $ 435,229
Harbor Uplands 424,344
Wastewater 458,235
Other Non-major Enterprise Funds 154,263
$ 1,472,071
46 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 9: COMPENSATED ABSENCES PAYABLE
The following is a summary of compensated absences payable transactions for the year ended June 30, 2023:
The long-term portion of compensated absences payable has been accrued for the Governmental Activities on the Government-Wide Financial Statement. Also, compensated absences are generally liquidated by the General Fund. There is no fixed payment schedule to pay these liabilities.
NOTE 10: LONG-TERM LIABILITIES
The following is a summary of long-term liabilities transactions for the year ended June 30, 2023:
Balance
June 30, 2022 Additions Deletions
Balance
June 30, 2023
Amounts Due
Within One
Year
Governmental Activities:
Compensated absences payable 3,801,003 $ 3,288,702 $ (3,300,178) $ 3,789,527 $ $ 947,382 Business-Type Activities:
Compensated absences payable 455,032 502,303 (408,411) 548,924 137,234 Total 4,256,035 $ 3,791,005 $ (3,708,589) $ 4,338,451 $ $ 1,084,616 Amounts
Balance at Balance at Due Within
June 30, 2022 Additions Deletions June 30, 2023 One Year Governmental Activities:
CFA 2019A Lease Revenue Refunding Bonds 26,540,000 $ $ ( - $ 585,000) $ 25,955,000 $ 605,000 Unamortized bond discount (673,180) - 25,732 (647,448) - CFA Lease Revenue Bonds Series 2021A 207,429,678 (6,905,763) - 200,523,915 6,932,520 Leases (See Note 5 b.) 2,002,632 (247,722) - 1,754,910 253,481 Subscriptions (See Note 6) 1,298,779 - (312,796) 985,983 318,312 Total governmental activities $ 235,299,130 $ 1,298,779 $ (8,025,549) $ 228,572,360 $ 8,109,312 Business-type Activites:
Wastewater Revenue Refunding 2014 Series A 5,060,000 $ $ ( - $ 325,000) $ 4,735,000 $ 340,000 Unarmortized bond premium 315,070 (26,255) - 288,815 -
CFA Lease Revenue Bonds Series 2021A 18,750,322 (624,237) - 18,126,085 627,480 Total business-type activies $ 24,125,392 $ ( - $ 975,492) $ 23,149,900 $ 967,480 47 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 10: LONG-TERM LIABILITIES (CONTINUED)
Community Financing Authority (CFA) 2019A Lease Revenue Refunding Bonds The Community Financing Authority issued refunding revenue bonds dated February 2019, totaling $28,015,000. The proceeds of the bonds were used to refund the various leaseback contingencies and finance the purchase of a sublease between the City and Redondo Fisherman’s Cove Company. The bonds bear interest at rates between 4.00% and 5.00% and interest is payable on each May 1 and November 1, commencing November 1, 2019. The bonds are payable from base rental payments. Principal is due annually beginning on May 1, 2020, in amounts ranging from $350,000 to $1,585,000. The bonds mature on May 1, 2049. The bonds are subject to optional and mandatory early redemption provisions. As of June 30, 2023, the balance outstanding was $25,955,000, with an unamortized discount of $647,448.
The annual requirements to amortize the outstanding bond indebtedness as of June 30, 2023, including interest, are as follows:
The following is a summary of the 2019A Lease Revenue Refunding unamortized discount outstanding at June 30, 2023:
Year Ending
June 30 Principal Interest Total
2024 605,000 $ 1,048,188 $ 1,653,188 $
2025 625,000 1,030,038 1,655,038
2026 640,000 1,010,506 1,650,506
2027 665,000 989,706 1,654,706
2028 685,000 968,094 1,653,094
2029-2033 3,815,000 4,445,475 8,260,475
2034-2038 4,640,000 3,616,569 8,256,569
2039-2043 5,690,000 2,569,731 8,259,731
2044-2048 7,005,000 1,255,025 8,260,025
2049 1,585,000 67,363 1,652,363
Total $ 25,955,000 $ 17,000,695 $ 42,955,695
Balance Balance
June 30, 2022 Additions Deletions June 30, 2023
$ (673,180) $ 25,732 - $ $ (647,448)
48 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 10: LONG-TERM LIABILITIES (CONTINUED)
Wastewater Revenue Bonds 2014, Series A
On March 25, 2014, the City issued $7,230,000 of Wastewater Revenue Refunding Bonds for the purpose of refunding $7,230,000 of then-outstanding 2004 Wastewater .Revenue Refunding Bonds. The purpose of the bonds was to finance certain improvements and related facilities that constitute part of the Wastewater Enterprise Fund. The serial bonds in the amount of $4,795,000 mature through May 1, 2029 and bear a variable interest rate ranging from 3% to 5% per annum. Term bonds in the amount of $2,435,000 mature through May 1, 2034, and bear interest at the rate of 4%. The serial bonds maturing on or after May 1, 2015, are subject to optional redemption provisions. The term bonds are subject to optional and mandatory redemption provisions. The bonds are payable solely from and secured by a pledge of and lien upon the net revenues of the Wastewater Enterprise Fund.
As of June 30, 2023, the balance outstanding was $4,735,000, with an unamortized bond premium of $288,815.
The annual requirements to amortize the outstanding bond indebtedness as of June 30, 2023, including interest, are as follows:
The following is a summary of the 2014 Revenue Bond Series A unamortized premium outstanding at June 30, 2023:
Community Financing Authority (CFA) Lease revenue Bonds Series 2021A In July 2021, the Redondo Beach Community Financing Authority (CFA) issued $226,180,000 Lease Revenue Bonds Series 2021A (federally taxable) to fund a portion of the City’s obligation to the California Public Employees’ Retirement System. The bond will be payable from base rental payment made by the City to the Authority as rental for portion of certain street located in the City. The bonds include $115,865,000 serial bonds with principal due on May 1 of each year starting in 2023 until 2026 and ranging in amount of $7,530,000 to $9,485,000.
The bonds also include term bonds in the amount of $51,785,000 and 58,530,000 due May 1, 2041 and 2049 respectively. Interest payable on the bonds ranges from 0.415% to 3.068% payable semiannually.
Year Ending
June 30 Principal Interest Total
2024 340,000 $ 205,488 $ 545,488 $
2025 355,000 188,488 543,488
2026 375,000 170,738 545,738
2027 395,000 151,988 546,988
2028 405,000 139,150 544,150
2029-2033 2,340,000 397,500 2,737,500
2034 525,000 21,000 546,000
Total 4,735,000 $ 1,274,352 $ 6,009,352 $
Balance Balance
June 30, 2022 Additions Deletions June 30, 2023
$ 315,070 $ (26,255) - $ $ 288,815
49 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 10: LONG-TERM LIABILITIES (CONTINUED)
As of June 30, 2023, $200,523,915 of the liability is reported in governmental activities and $18,126,085 is reported in business-type activities. The annual requirements to amortize the outstanding bond indebtedness including interest are as follows:
In the event of default, there is no remedy of acceleration of any Base Rental Payments which have not come due, and no right for the Authority to terminate the Lease and re-let the Leased Property. The sole remedy provided for in the Lease is to exercise any action at law or in equity necessary or desirable to collect the amounts due under the Lease.
In addition, the City is reporting a deferred charge on refunding as a deferred outflows of resources. The following is a summary of the amortization of the deferred charge for the fiscal year ending June 30, 2023:
NOTE 11: RISK MANAGEMENT
The City is exposed to risks of losses related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters; and currently reports all of its risk management activities in its Self-Insurance Program Internal Service Fund.
The City has adopted a self-insurance workers' compensation program, which is administered by a third-party agent, AdminSure. The self-insurance coverage for each claim is limited to $750,000. Excess coverage of up to $50,000,000 for each claim is provided by the Public Risk Innovations, Solutions, and Management (PRISM), an insurance pool, in which a consortium of counties and cities has agreed to share risks and losses. As of June 30, 2023, the estimated claims payable for workers' compensation was $13,269,916, which included claims incurred but not reported (IBNR). The current year's portion of the claims was $456,300.
Year Ending
June 30 Principal Interest Total
2024 7,560,000 $ 5,540,302 $ 13,100,302 $
2025 7,615,000 5,484,283 13,099,283
2026 7,695,000 5,408,057 13,103,057
2027 7,795,000 5,306,406 13,101,406
2028 7,920,000 5,306,406 13,226,406
2029-2033 42,035,000 23,474,871 65,509,871
2034-2038 47,515,000 17,995,254 65,510,254
2039-2043 51,635,000 10,601,664 62,236,664
2044-2048 34,640,000 3,572,993 38,212,993
2049 4,240,000 130,083 4,370,083
Total 218,650,000 $ 82,820,319 $ 301,470,319 $
Balance Balance
Deferred outflows of resources June 30, 2022 Additions Deletions June 30, 2023 Deferred loss on refunding $ 308,493 -$ (25,708) $ $ 282,785 50 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 11: RISK MANAGEMENT (CONTINUED)
For general liability claims, the City is also self-insured up to $500,000 for each occurrence. The self-insurance program is administered by a third-party agent, AdminSure. Each claim in excess of the self-insured retention of up to $30,000,000 is covered by the CSAC-EIA. As of June 30, 2023, the estimated claims payable for general liability was $7,651,470, which included IBNR. The current year's portion was $292,264. Governmental activities claims and judgments are generally liquidated by the General Fund.
The following is a summary of the changes in the claim liability over the past two fiscal years. Changes in the reported liability resulted from the following:
Settled claims have not exceeded any of the City's coverage amounts in any of the last three fiscal years and there were no reductions in the City's coverage during the year. The estimated claims payable for workers' compensation and general liability is based on estimates provided by the third-party administrator, the City Attorney, the Risk Management staff, and the City’s actuary.
NOTE 12: EMPLOYEE RETIREMENT PLANS
A. Pension Plans
Plan Description
The Plans are agent, multiple-employer defined benefit pension plans administered by the California Public Employees’ Retirement System (CalPERS). A full description of the pension plans regarding number of employees covered, benefit provisions, assumptions (for funding, but not account purposes), and membership information are listed in the June 30, 2021 Annual Actuarial Valuation Report (funding valuation). Details of the benefits provided can be obtained in Appendix B of the actuarial valuation report. The actuarial valuation report and CalPERS’ audited financial statements are publicly available reports that can be obtained at CalPERS’ website, at www.calpers.ca.gov.
Liability on
June 30, 2023
General Liability 7,651,470 $
Workers' Compensation 13,269,916
Total Claims Payable 20,921,386 $
Due within on year 748,564 $
Due in more than one year 20,172,822
$ 20,921,386
Beginning Ending Due Within
Balance Increase Decrease Balance One Year
2021-2022
Workers'comp $ 16,858,982 $ 1,326,703 $ (1,651,748) $ 16,533,937 $ 623,656 General liabilities 6,609,560 6,977,768 (5,883,086) 7,704,242 296,313 Total $ 23,468,542 $ 8,304,471 $ (7,534,834) $ 24,238,179 $ 919,969 2022-2023
Workers'comp $ 16,533,937 $ 1,331,205 $ (4,595,226) $ 13,269,916 $ 456,300 General liabilities 7,704,242 7,423,908 (7,476,680) 7,651,470 292,264 Total $ 24,238,179 $ 8,755,113 $ (12,071,906) $ 20,921,386 $ 748,564 Fiscal Year
51 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 12: EMPLOYEE RETIREMENT PLANS (CONTINUED)
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.
Tier 1 * Tier 2 * Tier 3
On or after
May 1, 2012 and
Hire date
Prior to
May 1, 2012
before
January 1, 2013
On or after
January 1, 2013
Benefit formula 2% @ 55 2% @ 60 2% @ 62
Benefit vesting schedule 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life Retirement age 50-63 50-63 52-67
Monthly benefits, as a % of eligible compensation 1.426%-2.418% 1.092%-2.418% 1.0%-2.5% Required employee contribution rates 7.00% 7.00% 7.25%
Required employer contribution rates. 35.490% 35.490% 35.490% * Closed to new entrants
Miscellaneous
Tier 1 * Tier 2 * Tier 3
On or after
May 1, 2012 and
Hire date
Prior to
May 1, 2012
before
January 1, 2013
On or after
January 1, 2013
Police - 3% @ 50 Police & Fire Police & Fire
Benefit formula Fire - 3% @ 55 3% @ 55 2.7% @ 57
Benefit vesting schedule 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life Retirement age 50-55 50-55 50-57
Monthly benefits, as a % of eligible compensation 2.4-3% 2.4-3% 2%-2.7% Required employee contribution rates 9.00% 9.00% 12.00% Required employer contribution rates 82.670% 82.670% 82.670% * Closed to new entrants
Safety
52 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 12: EMPLOYEE RETIREMENT PLANS (CONTINUED)
As of the valuation date of June 30, 2021, the following employees were covered by the benefit terms of the Plan:
Contributions
Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through the CalPERS’ annual actuarial valuation process. The actuarially determined rate is based on the estimated amount necessary to finance the costs and benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The employer is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employer contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan member contribution requirements are classified as plan member contributions.
For the year ended June 30, 2023, the employer contributions recognized as a reduction to the net position liability for all the Plans was $22,877,497.
Net Pension Liability
The net pension liability is measured as the total pension liability, less the pension plan’s fiduciary net position. The net pension liability of each of the Plans is measured as of June 30, 2022, using an annual actuarial valuation as of June 30, 2021 rolled forward to June 30, 2022 using standard update procedures. A summary of principal assumptions and methods used to determine the net pension liability is shown below.
Changes of Assumptions
Effective with the June 30, 2021 valuation date (2022 measurement date), the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. Projected returns for all asset classes are estimated, combined with risk estimates, and are used to project compound (geometric) returns over the long term. The discount rate used to discount liabilities was informed by the long-term projected portfolio return. In addition, demographic assumptions and the inflation rate assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The accounting discount rate was
7.15% for measurement dates 2017 through 2021, 7.65% for measurement dates 2015 through 2016, and
7.50% for measurement date 2014.
Miscellaneous Safety
Inactive employees or beneficiaries currently receiving benefits 527 320 Inactive employees entitled to but not yet receiving benefits 430 57 Active employees 276 145
Total 1,233 522
53 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 12: EMPLOYEE RETIREMENT PLANS (CONTINUED)
Actuarial Methods and Assumptions Used to Determine Total Pension Liability The June 30, 2021 valuation was rolled forward to determine the June 30, 2022 total pension liability based on the following actuarial methods and assumptions:
(1) Annual increases vary by category, entry age, and duration of service. (2) The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2021 CalPERS Experience Study for the period from 2001 to 2019. Pre-retirement and Postretirement mortality rates include generational mortality improvement using 80% of Scale MP-2020 published by the Society of Actuaries. For more details on this table, please refer to the CalPERS Experience Study and Review of Actuarial Assumptions report from November 2021 that can be found on the CalPERS website.at www.calpers.ca.gov.
Long-term Expected Rate of Return
The long-term expected rate of return on pension plan investments was determined using a building-block method in which future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.
In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectations. Using historical returns of all of the funds’ asset classes, expected compound (geometric) returns were calculated over the next 20 years using a building-block approach. The expected rate of return was then adjusted to account for assumed administrative expenses of 10 Basis points.
Miscellaneous Safety
Valuation Date June 30, 2021 June 30, 2021
Measurement Date June 30, 2022 June 30, 2022
Actuarial Cost Method Entry Age Normal Entry Age Normal Asset Valuation Method Market Value of Assets Market Value of Assets Actuarial Assumptions
Discount Rate 6.90% 6.90%
Inflation 2.50% 2.50%
Salary Increases (1) 3.30% to 14.20% 3.30% to 10.90%
Mortality Rate Table (2) Derived using CalPERS membership data for all funds the lesser of contract COLA up to 2.50% until purchasing Post Retirement Benefit Increase power protection allowance floor on purchasing power applies, 2.50% thereafter
54 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 12: EMPLOYEE RETIREMENT PLANS (CONTINUED)
The expected real rates of return by asset class are as followed:
Discount Rate
The discount rate used to measure the total pension liability was 6.90%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Subsequent Events
On July 12, 2021, CalPERS reported a preliminary 21.3% net return on investments for fiscal year 2020-21. Based on the thresholds specified in CalPERS Funding Risk Mitigation policy, the excess return of
14.3% prescribes a reduction in investment volatility that corresponds to a reduction in the discount rate used for funding purposes of 0.20%, from 7.00% to 6.80%. Since CalPERS was in the final stages of the four-year Asset Liability Management (ALM) cycle, the board elected to defer any changes to the asset allocation until the ALM process concluded, and the board could make its final decision on the asset allocation in November 2021.
On November 17, 2021, the board adopted a new strategic asset allocation. The new asset allocation along with the new capital market assumptions, economic assumptions and administrative expense assumption support a discount rate of 6.90% (net of investment expense but without a reduction for administrative expense) for financial reporting purposes. This includes a reduction in the price inflation assumption from 2.50% to 2.30% as recommended in the November 2021 CalPERS Experience Study and Review of Actuarial Assumptions. This study also recommended modifications to retirement rates, termination rates, mortality rates and rates of salary increases that were adopted by the board. These new assumptions will be reflected in the GASB 68 accounting valuation reports for the June 30, 2022, measurement date.
In July 2021, the Redondo Beach Community Financing Authority (CFA) issued $226,180,000 Lease Revenue Bonds Series 2021A (federally taxable) to fund a portion of the City’s obligation to the CalPERS.
Asset Class (1)
Assumed
Asset
Allocation
Real Return
(1, 2)
Global Equity - Cap-weighted 30.00% 4.54%
Global Equity Non-Cap-weighted 12.00% 3.84%
Private Equity 13.00% 7.28%
Treasury 5.00% 0.27%
Mortgage-backed Securities 5.00% 0.50%
Investment Grade Corporates 10.00% 1.56%
High Yield 5.00% 2.27%
Emerging Market Debt 5.00% 2.48%
Private Debt 5.00% 3.57%
Real Assets 15.00% 3.21%
Leverage -5.00% -0.59%
(2) Figures are based on the 2021-22 Asset Liability Management study. (1) An expected price inflation of 2.30% used for this period. 55 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 12: EMPLOYEE RETIREMENT PLANS (CONTINUED)
Changes in the Net Pension Liability
The following table shows the changes in net pension liability recognized over the measurement period for the City Miscellaneous Plan.
The following table shows the changes in net pension liability recognized over the measurement period for the City Safety Plan.
(1) The fiduciary net position includes receivables for employee service buybacks, deficiency reserves, fiduciary self-insurance and OPEB expense. As described in the previous section of this note, this may differ from the plan assets reported in the funding actuarial valuation report.
Miscellaneous Plan Plan Total Pension Plan Fiduciary Net Plan Net Pension Liability Position Liability
(a) (b) (c) = (a) - (b)
Balance at: 6/30/2021 - Measurement Date $ 192,185,019 232,076,841 $ 39,891,822 $ Changes Recognized for the
Measurement Period:
Service Cost 3,349,243 - 3,349,243
Interest on the Total Pension Liability 15,836,385 - 15,836,385 Changes of Assumptions 6,057,682 - 6,057,682
Differences between Expected
and Actual Experience (3,768,503) - (3,768,503)
Contributions from the Employer - 70,759,414 (70,759,414) Contributions from the Employees - 1,393,334 (1,393,334) Net Investment Income (18,874,022) - 18,874,022
Benefit Payments, including Refunds of
Employee Contributions (13,055,631) (13,055,631) -
Administrative Expense - (119,720) 119,720
Net Changes during 2021-22 8,419,176 40,103,375 (31,684,199) Balance at: 6/30/2022 - Measurement Date (1) $ 240,496,017 $ 232,288,394 $ 8,207,623 Increase (Decrease)
Safety Plan Plan Total Pension Plan Fiduciary Net Plan Net Pension Liability Position Liability
(a) (b) (c) = (a) - (b)
Balance at: 6/30/2021 - Measurement Date $ 401,931,335 $ 297,489,934 $ 104,441,401 Changes Recognized for the
Measurement Period:
Service Cost 6,249,142 - 6,249,142
Interest on the Total Pension Liability 27,763,771 - 27,763,771 Changes of Assumptions 11,089,291 - 11,089,291
Differences between Expected
and Actual Experience (1,796,249) - (1,796,249)
Contributions from the Employer - 155,865,005 (155,865,005) Contributions from the Employees - 1,976,975 (1,976,975) Net Investment Income (32, - 498,996) 32,498,996
Benefit Payments, including Refunds of -
Employee Contributions (23,950,891) (23,950,891) -
Administrative Expense - (185,318) 185,318
Net Changes during 2021-22 19,355,064 101,206,775 (81,851,711) Balance at: 6/30/2022 - Measurement Date (1) $ 421,286,399 $ 398,696,709 $ 22,589,690 Increase (Decrease)
56 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 12: EMPLOYEE RETIREMENT PLANS (CONTINUED)
Sensitivity of the Net Pension Liability to Changes in the Discount Rate The following presents the net pension liability for the Plan as of the measurement date, calculated using the discount rate of 6.90 percent, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage-point lower (5.90 percent) or 1 percentage-point higher (7.90 percent) than the current rate:
Pension Plan Fiduciary Net Position
The plan fiduciary net position disclosed in the GASB 68 accounting valuation report may differ from the plan assets reported in the funding actuarial valuation report due to several reasons. First, for the accounting valuations, CalPERS must keep items such as deficiency reserves, fiduciary self-insurance and OPEB expense included as assets. These amounts are excluded for rate setting purposes in the funding actuarial valuation. In addition, differences may result from early Comprehensive Annual Financial Report closing and final reconciled reserves.
Detailed information about each pension plan’s fiduciary net position is available in the separately issued CalPERS financial reports. See CalPERS website for additional information.
For the measurement period ending June 30, 2022 (the measurement date) and fiscal year ending June 30, 2023, the City incurred a pension expense of $5,076,109 and $15,105,242 the miscellaneous and safety plans, respectively.
As of June 30, 2023, the following were the reported deferred outflows of resources and deferred inflows of resources related to all pension plans:
Discount Rate - 1% Current Discount Discount Rate + 1%
(5.90%) Rate (6.90%) (7.90%)
Miscellaneous Plan 38,519,477 $ 8,207,623 $ (16,904,420) $ Safety Plan 75,612,650 22,589,690 (21,248,588)
$ 30,797,313 114,132,127 $ (38,153,008) $
Net Pension Liability
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
City pension contribution subsequent to
measurement date $ 1,995,492 $ $ 4,682,522 - $ -
Difference between expected and
actual experience (2,492,071) - 113,917 (1,738,628)
Change in Assumptions 3,533,648 7,920,922 - -
Net difference between projected and
actual earnings on pension plan
investments 13,929,406 24,997,801 - -
Total $ 19,458,546 $ (2,492,071) $ 37,715,162 $ (1,738,628) Miscellaneous Safety
57 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 12: EMPLOYEE RETIREMENT PLANS (CONTINUED)
Contributions subsequent to the measurement date in the amount of $1,995,492 and $4,682,522 are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2024. Other amounts reported as deferred outflows or deferred inflows of resources related to pensions will be recognized as pension expense as follows:
B. Other Post-Employment Benefits
Plan Description and Eligibility
In addition to the pension benefits described above, the City provides certain health insurance benefits, in accordance with memorandums of understanding, to retired employees through the California Employers' Retiree Benefit Trust (CERBT) Fund, which is an agent multiple-employer plan administered by CalPERS. The City provides medical insurance for employees in accordance with agreements reached with various bargaining groups. The City shall pay the single retiree medical premium rate, for qualified retirees, for a medical insurance plan in which the retiree is enrolled from among those medical plans provided by the City. These contributions of the City for such medical premiums shall cease on the date the retiree becomes eligible to enroll in the Federal Medicare program and/or any Medicare supplemental plans. Membership of the plan consisted of the following at June 30, 2022 (the measurement date).
Contributions
The required contribution of the City is based on a percentage of PERSable payroll. For the measurement date ended June 30, 2022 the City’s cash contributions were $2,024,400.
Miscellaneous Safety
Measurement
Period ended
June 30:
Deferred
Outflows/(Inflows)
of Resources
Deferred
Outflows/(Inflows)
of Resources
2023 $ 3,352,494 $ 7,377,283
2024 2,912,073 7,324,476
2025 1,875,900 5,066,217
2026 6,830,516 11,526,036
$ 14,970,983 $ 31,294,012
Number of
Employees
Active Employees 390
Inactives currently receiving benefits 167
Inactives entitled to but not yet receiving benefits 325 Total 882
58 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 12: EMPLOYEE RETIREMENT PLANS (CONTINUED)
Actuarial Methods and Assumptions Used to Determine Net OPEB Liability The City’s net OPEB Liability was measured as of June 30, 2022 and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation dated June 30, 2021 based on the following actuarial methods and assumptions:
Valuation Date June 30, 2021
Contribution Policy City contributes full actuarially determined contribution Discount Rate and 6.25% at June 30, 2022
Long-Term Expected Rate 6.25% at June 30, 2021
of Return on Assets Expected City contributions projected to keep sufficient plan assets to pay all benefits from trust
General Inflation 2.5%
Mortality, Retirement, CalPERS 2000-2019 Experience Study Disability, Termination
Mortality Improvement Mortality projected fully generational with Scale MP-2021
Salary Increases Aggregate - 2.75% annually
Merit - CalPERS 2000-2019 Experience Study
Medical Trend Non-Medicare - 6.5% for 2023, decreasing to an ultimate rate of 3.75% in 2076
Medicare - n/a
PEMHCA Minimum Increases 4% annually
Medical Participation for Currently covered - 100%, 90%, 60%, 50% for Additional Benefit employees receiving 100%, 75%, 50%, 25% City paid premium respectively
Not currently covered - 90% of above rates
PEMHCA Medical Participation Currently covered - 10% for 2021, increasing to ultimate rate of 50% in 2033
Not currently covered - 90% of above rates
Life Insurances Participation Future retirees: 10%
Change of assumptions None
Changes of benefit items None
59 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 12: EMPLOYEE RETIREMENT PLANS (CONTINUED)
Long-term Expected Rate of Return
The expected real rates of return by asset class are as followed:
The long-term expected real rates of return are presented as geometric means.
Discount Rate
The discount rate used to measure the total OPEB liability was 6.25 percent. The projection of cash flows used to determine the discount rate assumed that City contributions will be made at rates equal to the actuarially determined contribution rates. Based on those assumptions, the OPEB plan’s fiduciary net position was projected to be available to make all projected OPEB payments for current active and inactive employees and beneficiaries.
Therefore, the long-term expected rate of return on OPEB plan investments was applied to all periods of projected benefit payments to determine the total OPEB liability.
Changes in the OPEB Liability
Target Allocation Expected Real
Asset Class Component CERBT - Strategy 1 Rate of Return Global Equity 49% 4.56%
Fixed Income 23% 1.56%
TIPS 5% -0.08%
Commodities 3% 1.22%
REITs 20% 4.06%
(1) Assumed Long-Term Rate of Inflation 2.50%
(2) Expected Long-Term Net Rate of Return,
rounded to the nearest quarter percent 6.25%
Total OPEB Fiduciary Net OPEB
Liability Net Position Liability
(a) (b) (c) = (a) - (b)
Balance at June 30, 2022 (measurement date June 30, 2021) 21,727,995 $ $ 10,418,552 $ 11,309,443 Changes recognized for the measurement period:
Service cost 732,825 732,825 -
Interest 1,351,025 1,351,025 -
Benefit changes - - -
Actual vs. expected experience - - -
Assumption changes - - -
Contributions - employer 2,024,400 - (2,024,400)
Net investment income (1,612,311) - 1,612,311
Benefit payments (1,688,875) (1,688,875) -
Administrative expenses (7,783) - 7,783
Net changes 394,975 (1,284,569) 1,679,544
Balance at June 30, 2023 (measurement date June 30, 2022) 22,122,970 $ $ 9,133,983 $ 12,988,987 60 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 12: EMPLOYEE RETIREMENT PLANS (CONTINUED)
Sensitivity of the Net OPEB Liability to Changes in the Discount Rate The following presents the net OPEB liability of the City if it were calculated using discount rate that is one percentage point lower or one percentage point higher than the current rate for the measurement period ended June 30, 2022.
Sensitivity of the Net OPEB Liability to Changes in the Health Care Cost Trend Rates The following presents the net OPEB liability of the City if it were calculated using health care cost-trend rates that are one percentage point lower or one percentage point higher than the current rate for the measurement period ended June 30, 2022.
OPEB Plan Fiduciary Net Position
CalPERS issues a publicly available financial report that includes financial statements and required supplementary information. Copies of the CalPERS’ annual financial report may be obtained from the CalPERS Executive Office, 400 P Street, Sacramento, California 95814.
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB.
For the fiscal year ended June 30, 2023, the City recognized OPEB expense of $815,857. As of fiscal year ended June 30, 2023 (June 30, 2022 measurement date), the City reported deferred outflows of resources related to OPEB from the following sources:
1% Decrease
(5.25%)
Current Discount
Rate (6.25%)
1% Increase
(7.25%)
Net OPEB Liability 15,130,994 $ 12,988,987 $ 11, $ 128,826 1% Decrease
Current Healthcare Cost
Trend Rates 1% Increase
Net OPEB Liability 10, $ 12, 670,810 $ 15, 988,987 $ 749,470 Deferred Outflows of
Resources
Deferred Inflows of
Resources
OPEB contributions subsequent to measurement date 1, $ - 822,393 $ Differences between expected and actual experience - 3,829,317 Changes of assumptions 1,295,811 943,220
Net difference between projected and actual earnings
on OPEB plan investments 816,486 -
Total $ 4,772,537 3,934,690 $
61 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 12: EMPLOYEE RETIREMENT PLANS (CONTINUED)
The $1,822,393 reported as deferred outflows of resources related to contributions subsequent to measurement date will be recognized as a reduction to net OPEB liability in the year ended June 30, 2023. Other amounts reported as deferred inflows of resources related to OPEB will be recognized as expense as follows:
NOTE 13: COMMITMENTS AND CONTINGENCIES
A. Lawsuits
The City is a defendant in various lawsuits. Although the outcome of these lawsuits is not presently determinable, it is the opinion of the City's legal counsel that resolution of these matters will not have a material adverse effect on the financial condition of the City.
B. Federal and State Grant Programs
The City participates in Federal and State grant programs. These programs are subject to audit. No cost disallowance is expected as a result of any audits. Expenditures which may be disallowed, if any, by the granting agencies cannot be determined at this time. The City expects such amounts, if any, to be immaterial.
C. Commitments
The following material construction commitments existed at June 30, 2023:
NOTE 14: POLLUTION REMEDIATION OBLIGATIONS
The Department of Toxic Substances Control (DTSC) filed a regulatory Notice of Violation against the City regarding the Redondo Beach Police Department's gun range concerning issues with contamination from lead bullet fragments. Cleanup, fines, assessments, and settlements incurred by the City for this DTSC action were approximately $282,000. This liability has been accrued in the General Fund, and the City does not anticipate any recoveries reducing the liability, nor any further liability from this DTSC investigation as the DTSC has closed the matter.
Year Ended
June 30
Deferred Outflow /
(Inflows) of Resources
2024 $ (549,803)
2025 (540,755)
2026 (523,625)
2027 (137,831)
2028 (428,963)
Thereafter (479,263)
$ (2,660,240)
Project Name
Contract
Amount
Expenditures
to date as of
June 30, 2023
Remaining
Commitments
Portofino Way Sewer Pump Station 7,514,000 $ $ - 7,514,000 $ Torr Blvd Resurf-PCH to Prospect 4,008,633 2,474,879 1,533,754 Seaside Lagoon 3,112,534 286,168 2,826,366
Sanitary Sewers Facilities Rehab 1,290,000 301,283 988,717 Portofino Way Sewer Pump Station 694,302 14,842 679,460 62 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 14: POLLUTION REMEDIATION OBLIGATIONS (CONTINUED)
Neighboring property owners adjacent to the gun range also filed civil claims for bodily injury and property damage due to alleged lead exposure. This matter is currently in mediation and in preparation for arbitration. Defense costs are being covered by several of the City’s historical insurance policies and the related insurance carriers defending under a reservation of rights.
Cleanup and settlements currently are estimated to be $150,000, using assumptions based on similar cleanup and settlements previously paid in the DTSC matter. Plaintiffs’ demands are significantly higher. The pollution remediation obligation is an estimate and is subject to revision because of price increases or reductions, changes in technology, changes in evidence, or changes in applicable laws or regulations. Similarly, bodily injury claims are estimated based on current evidence (or lack thereof) presented by the various plaintiffs and are subject to revision if additional admissible evidence is presented during preparation for arbitration.
NOTE 15: SUCCESSOR AGENCY
Dissolution of California Redevelopment Agencies
On December 29, 2011, the California Supreme Court upheld Assembly Bill X1 26 (Bill) that provides for the dissolution of all redevelopment agencies in the State of California. Most cities in California had established a redevelopment agency that was included in the reporting entity of the City as a blended component unit (since the City Council, in many cases, also served as the governing board for those agencies).
The Bill provides that upon dissolution of a redevelopment agency, either the City or another unit of local government will agree to serve as the “successor agency” to hold the assets until they are distributed to other units of state and local government. If the City declines to accept the role of successor agency, other local agencies may elect to perform this role. If no local agency accepts the role of successor agency, the Governor is empowered by the Bill to establish a local “designated local authority" to perform this role. On January 10, 2012 the City Council met and created a Successor Agency in accordance with the Bill as part of the City’s resolution number 12-01.
After enactment of the law, which occurred on June 28, 2011, redevelopment agencies in the State of California cannot enter into new projects, obligations or commitments. Subject to the control of a newly established oversight board, remaining assets can only be used to pay enforceable obligations in existence at the date of dissolution (including the completion of any unfinished projects that were subject to legally enforceable contractual commitments).
A. Long Term Debt
In future fiscal years, successor agencies will only be allocated tax revenue in the amount that is necessary to pay the estimated annual installment payments on enforceable obligations of the former redevelopment agency until all enforceable obligations of the prior redevelopment agency have been paid in full.
The Bill directs the State Controller of the State of California to review the propriety of any transfers of assets between redevelopment agencies and other public bodies that occurred after January 1, 2011. If the public body that received such transfers is not contractually committed to a third party for the expenditure or encumbrance of those assets, the State Controller is required to order the available assets to be transferred to the public body designated as the successor agency by the Bill.
In accordance with the timeline set forth in the Bill (as modified by the California Supreme Court on December 29, 2011) all redevelopment agencies in the State of California were dissolved and ceased to operate as a legal entity as of February 1, 2012. Prior to that date, the final seven months of the activity of the redevelopment agency is reported in the governmental funds of the City. After the date of dissolution, activities of the dissolved redevelopment agency are reported in a fiduciary trust fund (private purpose trust fund) in the fiduciary statements of the City.
63 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 15: SUCCESSOR AGENCY (CONTINUED)
In accordance with the provisions of Assembly Bill X1 26 (Bill) and the California Supreme Court’s decision to uphold the Bill, the obligations of the former redevelopment agency became vested with the funds established for the successor agency upon the date of dissolution, February 1, 2012. Former tax increment revenues pledged to fund the debts of the former redevelopment agency will be distributed to the Successor Agency subject to the reapportionment of such revenues as provided by the Bill.
The debt of the Successor Agency as of June 30, 2023 is as follows:
1983 Tax Increment Deferral - On November 15, 1983, the Agency and the County of Los Angeles (County) entered into an agreement for reimbursement of tax increment funds. It was recognized that the South Bay Center Project Area needed to utilize a substantial portion of the annual tax increment in the early years to finance its redevelopment activities. Therefore, the County taxing entities agreed to defer receipt of tax increment reimbursement from the Agency. This deferral is debt of the Agency to be repaid only from the Agency's share of future pledged tax increment. There is no fixed payment schedule to repay this loan and the loan is non-interest bearing. The balance outstanding at June 30, 2023, was $4,683,632. 1984 Tax Increment Deferral - On February 14, 1984, the Agency and the County entered into an agreement for reimbursement of tax increment funds. It was recognized that the Aviation High School Project Area needed to utilize a substantial portion of the annual tax increment in the early years to finance its redevelopment activities.
Therefore, the County taxing entities agreed to defer receipt of tax increment reimbursement from the Agency. This deferral is debt of the Agency to be repaid only from the Agency's share of future pledged tax increment. There is no fixed payment schedule to repay this loan and the loan is non-interest bearing. The balance outstanding at June 30, 2023, was $5,602,499.
South Bay Center City Loan – On July 1, 1996, the Public Financing Authority advanced $8,660,000 to the former Redevelopment Agency for improvements within the South Bay Center Redevelopment Project Area. This advance was made through the Authority’s purchase of the Agency’s 1996 tax allocation bonds and bears interest at 8.95% per annum. As of June 30, 2023, the balance outstanding was $2,715,000.
B. Advances from City
During the 2014-2015 fiscal year, the Successor Agency Oversight Board adopted resolutions approving the repayment of loans from the Low and Moderate Income Housing fund of the former Redevelopment Agency for legally required payments to the Supplemental Educational Revenue Augmentation Fund (SERAF) for Fiscal Years 2009-2010 and 2010-2011. As of June 30, 2023, the outstanding balance was $535,731.
NOTE 16: RISKS AND UNCERTAINTIES
A. Grants
Amounts received or receivable from grant agencies are subject to audit and adjustment by grantor agencies. Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of expenditures that may be disallowed by the grantor cannot be determined at this time, although the City expects such amounts, if any, to be immaterial.
Amounts
Balance Balance Due Within
June 30, 2022 Additions Deletions June 30, 2023 One Year Successor Agency:
County Deferral Loan-1983 Tax Increment 6,019,095 $ - $ 1,335,463 $ 4,683,632 $ $ - County Deferral Loan-1984 Tax Increment 6,286,162 683,663 - 5,602,499 - City Loan-South Bay Center 3,260,000 545,000 - 2,715,000 595,000 Total $ 15,565,257 $ 2,564,126 - $ $ 13,001,131 $ 595,000 64 DRAFT
CITY OF REDONDO BEACH
Notes to the Financial Statements
For the Year Ended June 30, 2023
NOTE 16: RISKS AND UNCERTAINTIES (CONTINUED)
B. Successor Agency
Deductions (expenses) incurred by the Successor Agency for the year ended June 30, 2023 (and subsequent years in which the Successor Agency is in operation) are subject to review by various State agencies and the County in which the Successor Agency resides. If any expenses incurred by the Successor Agency are disallowed by the State agencies or County, the City, acting as the Successor Agency could be liable for the repayment of the disallowed costs from either its own funds or by the State withholding remittances normally paid to the City. The amount, if any, of expenses that may be disallowed by the State agencies or County cannot be determined at this time, although the Successor Agency expects such amounts, if any, to be immaterial. 65 DRAFT
REQUIRED SUPPLEMENTARY INFORMATION
66 DRAFT
CITY OF REDONDO BEACH
Notes to the Required Supplementary Information
For the Year Ended June 30, 2023
NOTE 1: BUDGETARY INFORMATION
Through the budget, the City Council sets the direction of the City, allocates its resources and establishes its priorities. The Annual Budget assures the efficient and effective uses of the City's economic resources, as well as establishing that the highest priority objectives are accomplished.
The Annual Budget serves from July 1 to June 30, and is a vehicle that openly communicates these priorities to the community, businesses, vendors, employees and other public agencies. Additionally, it establishes the foundation of effective financial planning by providing resource planning performance measures and controls that permit the evaluation and adjustment of the City's performance.
The City follows these procedures in establishing the budgetary data reflected in the basic financial statements:
1. The City Council approves each year's budget submitted by the City Manager prior to the beginning of the new fiscal year.
2. The City Council's policy is to adopt an annual line-item budget for the general, special revenue, debt service, and capital projects funds.
3. Public hearings are conducted prior to its adoption by the Council.
4. Supplemental appropriations, when required during the period, are also approved by the Council.
Intradepartmental budget changes are approved by the City Manager.
5. Expenditures may not exceed appropriations at the departmental level, which is the legal level of control.
Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is employed as an extension of formal budgetary integration in the general, special revenue, debt service, and capital projects funds.
Unexpended and unencumbered appropriations of these governmental funds automatically lapse at the end of the fiscal year. Encumbrances outstanding at year-end are reported with restricted, committed, assigned, and/or unassigned fund balances. They do not constitute expenditures or estimated liabilities. Budgets were legally adopted for all governmental funds with the exception of the Parking Authority Debt Service Fund, the Pier Parking Structure Rehabilitation Capital Projects Fund, and Major Facilities Reconstruction Capital Projects Fund.
The following are the budget comparison schedules for General Fund, Other Intergovernmental Grants Special Revenue Fund and Low-Mod Income Housing Special Revenue Fund.
For the fiscal year ended June 30, 2023, the following departments have excess expenditures over appropriations:
Expenditures Appropriations
Excess on
Expendiure over
Appropriations
General Fund
Community services 6,688,048 $ 6,525,001 $ 163,047 $
Other Intergovernmental Grants
Public works 86,759 85,821 938
Narcotic Seizure / Forfeiture
Capital outlay 26,048 563 25,485
Proposition C
Public works 3,900 2,825 1,075
Housing Authority
Housing and community
development 7,564,464 6,737,666 826,798
67 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
General Fund
Year Ened June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ 29,368,998 $ 29,368,998 $ 29,368,998 $ - Resources (Inflows):
Taxes 73,531,428 76,488,843 76,446,608 (42,235)
Interdepartmental 10,036,226 8,747,688 8,745,517 (2,171) Licenses and permits 2,267,859 2,267,859 2,607,527 339,668 Intergovernmental 240,000 249,496 331,107 81,611
Charges for services 7,694,515 7,694,515 9,924,671 2,230,156 Use of money and property 2,510,396 2,510,396 2,535,421 25,025 Fines and forfeitures 1,446,200 1,446,200 1,341,895 (104,305) Miscellaneous 3,153,922 3,153,922 3,917,756 763,834
Transfers in 1,750,927 1,750,927 1,650,733 (100,194)
Subscription financing - - 415,357 415,357
Amounts Available for Appropriations 132,000,471 133,678,844 137,285,590 3,606,746 Charges to Appropriation (Outflow):
General government
Mayor and city council 916,670 935,204 691,918 243,286
City clerk 1,471,931 1,717,386 1,584,077 133,309
City treasurer 405,921 403,580 312,872 90,708
City attorney 3,678,341 3,722,490 3,279,374 443,116
City manager 1,142,831 1,159,598 1,045,122 114,476
Human resources 2,645,842 2,591,849 2,129,597 462,252
Financial services 2,796,337 2,771,038 2,390,766 380,272 Public safety
Police 39,239,497 38,945,359 37,939,105 1,006,254
Fire 18,760,495 18,412,075 17,525,930 886,145
Housing and community development
Community development 3,688,732 3,613,563 3,123,262 490,301 Waterfront and economic development 358,707 456,269 301,780 154,489 Cultural and leisure services
Community services 6,109,718 6,524,001 6,688,048 (164,047) Library 4,315,967 4,608,023 4,366,822 241,201
Public works
Public works 7,223,525 8,011,317 7,515,994 495,323
Capital outlay 3,101,130 3,508,669 469,495 3,039,174
Debt service:
Principal retirement 6,458,866 6,458,866 379,343 6,079,523 Interest and fiscal charges 4,779,660 4,779,660 10,452 4,769,208 Transfers out 4,068,582 4,068,582 14,343,215 (10,274,633) Total Charges to Appropriations 111,162,752 112,687,529 104,097,172 8,590,357 Budgetary Fund Balance, June 30 $ 20,837,719 $ 20,991,315 $ 33,188,418 $ 12,197,103 68 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Other Intergovernmental Grants
Year Ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ (6,858,755) $ (6,858,755) $ (6,858,755) $ - Resources (Inflows):
Intergovernmental 11,690,794 15,069,918 8,149,118 (6,920,800) Amounts Available for Appropriations 4,832,039 8,211,163 1,737,068 (6,474,095) Charges to Appropriation (Outflow):
General government 616,128 1,221,221 437,769 783,452
Public safety 182,380 769,843 672,852 96,991
Community development 310,000 849,336 67,402 781,934
Cultural and leisure services - 362,979 268,712 94,267
Public works 83,821 85,821 86,759 (938)
Capital outlay 10,498,465 28,642,725 6,178,217 22,464,508 Debt service:
Principal retirement - - 67,743 (67,743)
Interest and fiscal charges - - 10,968 (10,968)
Total Charges to Appropriations 11,690,794 31,931,925 7,790,422 24,141,503 Budgetary Fund Balance, June 30 $ (6,858,755) $(23,720,762) $ (6,053,354) $ 17,667,408 69 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Low-Mod Income Housing
Year Ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $3,841,655 $ 3,841,655 $ 3,841,655 $ - Resources (Inflows):
Use of money and property - - 41,781 41,781
Miscellaneous 217,891 217,891 - (217,891)
Amounts Available for Appropriations 4,059,546 4,059,546 3,883,436 (176,110) Charges to Appropriation (Outflow):
Housing and community development 150,000 150,000 106,722 43,278 Cultural and leisure services 279,000 279,000 279,000 - Total Charges to Appropriations 429,000 429,000 385,722 43,278 Budgetary Fund Balance, June 30 $3,630,546 $ 3,630,546 $ 3,497,714 $ (132,832) 70 DRAFT
CITY OF REDONDO BEACH
Schedule of Changes in Net Pension Liability and Related Ratios Miscellaneous Plan - Agent Multiple-Employer
As of June 30, For the Last Ten Fiscal Years (1)
2015 2016 2017 2018
TOTAL PENSION LIABILITY
Service Cost $ 2,874,216 $ 2,537,587 $ 2,658,781 $ 3,296,064 Interest 12,419,054 12,947,817 13,391,115 13,844,417
Difference between Expected and Actual Experience - (58,913) (717,631) 808,043 Changes in Assumptions - (3,072,251) - 11,132,579
Benefit Payments, Including
Refunds of Employee Contributions (7,872,679) (8,784,656) (9,282,593) (10,173,782) Net Change in Total Pension Liability 7,420,591 3,569,584 6,049,672 18,907,321 Total Pension Liability - Beginning 168,086,614 175,507,205 179,076,789 185,126,461 Total Pension Liability - Ending (a) $ 175,507,205 $ 179,076,789 $ 185,126,461 $ 204,033,782
PLAN FIDUCIARY NET POSITION
Contributions - Employer $ 2,678,754 $ 2,783,258 $ 3,517,596 $ 4,018,170 Contributions - Employee 1,301,991 1,282,878 1,361,650 1,404,270 Plan to Plan Resource Movement - 2,745 (2,463) -
Net Investment Income 21,314,935 3,161,165 777,656 14,967,632 Benefit Payments, Including
Refunds of Employee Contributions (7,872,679) (8,784,656) (9,282,593) (10,173,782) Administrative Expense - (158,175) (85,184) (200,883)
Other Miscellaneous Income/(Expense) - - - -
Net Change in Fiduciary Net Position 17,423,001 (1,712,785) (3,713,338) 10,015,407 Plan Fiduciary Net Position - Beginning 124,062,963 141,485,964 139,773,179 136,059,841 Plan Fiduciary Net Position - Ending (b) $ 141,485,964 $ 139,773,179 $ 136,059,841 $ 146,075,248 Plan Net Pension Liability/(Assets) - Ending (a) - (b) $ 34,021,241 $ 39,303,610 $ 49,066,620 $ 57,958,534
80.62% 78.05% 73.50% 71.59%
Covered Payroll $ 17,538,911 $ 17,124,613 $ 19,222,807 $ 19,613,902 193.98% 229.52% 255.25% 295.50%
Notes to Schedule:
Changes of Assumptions:
Effective with the June 30, 2021 valuation date (2022 measurement date), the accounting discount rate was reduced from 7.15% to
6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. Projected returns for all asset classes are estimated, combined with risk estimates, and are used to project comp ound (geometric) returns over the long term. The discount rate used to discount liabilities was informed by the long-term projected portfolio return. In addition, demographic assumptions and the inflation rate assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The ac counting discount rate was 7.15% for measurement dates 2017 through 2021, 7.65% for measurement dates 2015 through 2016, and 7.50% for measurement date 2014.
Plan Fiduciary Net Position as a Percentage of the Total Pension Liability
Plan Net Pension Liability/(Asset) as a Percentage of
Covered Payroll
Benefit Changes:
(1) Historical information is required only for measurement years for which GASB 68 is applicable. Fiscal Year 2015 was the first year of implementation, therefore only nine years are shown.
The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date. However, offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes) that occurred after the Valuation Date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary. 71 DRAFT
2019 2020 2021 2022 2023
$ 3,370,814 $ 3,397,192 $ 3,426,450 $ 3,267,559 $ 3,349,243 14,225,068 14,990,021 15,398,568 15,785,975 15,836,385
(291,950) 4,185,447 (1,088,566) (1,273,036) (3,768,503) (1,050,285) - - - 6,057,682
(10,849,928) (11,341,781) (11,856,917) (12,251,572) (13,055,631) 5,403,719 11,230,879 5,879,535 5,528,926 8,419,176
204,033,782 209,437,501 220,668,380 226,547,915 232,076,841 $ 209,437,501 $ 220,668,380 $ 226,547,915 $ 232,076,841 $ 240,496,017 $ 4,408,505 $ 5,141,337 $ 5,895,816 $ 6,313,617 $ 70,759,414 1,456,828 1,461,551 1,487,258 1,370,930 1,393,334
(355) - - -
12,226,183 9,905,031 7,811,724 36,083,015 (18,874,022)
(10,849,928) (11,341,781) (11,856,917) (12,251,572) (13,055,631) (227,625) (108,939) (222,338) (160,659) (119,720)
(432,265) 355 - - -
6,581,343 5,057,554 3,115,543 31,355,331 40,103,375
146,075,248 152,656,591 157,714,145 160,829,688 192,185,019 $ 152,656,591 $ 157,714,145 $ 160,829,688 $ 192,185,019 $ 232,288,394 $ 56,780,910 $ 62,954,235 $ 65,718,227 $ 39,891,822 $ 8,207,623
72.89% 71.47% 70.99% 82.81% 96.59%
$ 20,156,748 $ 21,343,149 $ 20,914,206 $ 19,503,029 $ 18,792,136 281.70% 294.96% 314.23% 204.54% 43.68%
72 DRAFT
CITY OF REDONDO BEACH
Schedule of Plan Contribtuions
Miscellaneous Plan - Agent Multiple-Employer
As of June 30, For the Last Ten Fiscal Years (1)
2015 2016 2017 2018
Actuarially Determined Contribution $ 2,783,258 $ 3,517,053 $ 4,018,056 $ 4,399,141 Contribution in Relation to the Actuarially Determined Contribution (2,783,258) (3,517,053) (4,018,056) (4,399,141) Contribution Deficiency (Excess) $ - $ - $ - $ -
Covered Payroll $ 17,124,613 $ 19,222,807 $ 19,613,902 $ 20,156,748 Contributions as a Percentage of Covered Payroll 16.25% 18.30% 20.49% 21.82% Note to Schedule:
Valuation Date: June 30, 2021
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry Age Normal Cost Method
Amortization method Level percentage of payroll, closed Assets valuation method Fair Value of Assets.
Discount rate 6.90% (net of investment and administrative expenses) Projected Salary Increases
Inflation
Payroll growth
2.50%
Varies by Entry Age and Service
2.75%
(1) Historical information is required only for measurement for which GASB 68 is applicable. Fiscal Year 2015 was the first year of implementation, therefore only nine years are shown.
73 DRAFT
2019 2020 2021 2022 2023
$ 5,140,690 $ 5,895,512 $ 6,314,575 $ 4,739,046 $ 1,995,492 (5,140,690) (5,895,512) (6,314,575) (70,741,465) (1,995,492) $ - $ - $ - $ (66,002,419) $ -
$ 21,343,149 $ 20,914,206 $ 19,503,029 $ 18,792,136 $ 20,726,906
24.09% 28.19% 32.38% 376.44% 9.63%
74 DRAFT
CITY OF REDONDO BEACH
Safety Plan- Agent Multiple-Employer
Safety Plan- Agent Multiple-Employer
As of June 30, For the Last Ten Fiscal Years (1)
2015 2016 2017 2018
TOTAL PENSION LIABILITY
Service Cost $ 4,500,890 $ 4,369,526 $ 4,352,710 $ 5,065,945 Interest 21,930,219 22,764,197 23,438,824 23,940,703
Difference between Expected and Actual Experience - 854,509 (769,075) (493,558) Changes in Assumptions - (5,276,514) - 19,087,843
Benefit Payments, Including
Refunds of Employee Contributions (16,352,903) (17,197,393) (17,877,775) (18,716,805) Net Change in Total Pension Liability 10,078,206 5,514,325 9,144,684 28,884,128 Total Pension Liability - Beginning 298,328,930 308,407,136 313,921,461 323,066,145 Total Pension Liability - Ending (a) $ 308,407,136 $ 313,921,461 $ 323,066,145 $ 351,950,273
PLAN FIDUCIARY NET POSITION
Contributions - Employer $ 5,790,913 $ 6,493,477 $ 7,448,334 $ 8,431,955 Contributions - Employee 2,003,854 1,397,695 1,457,236 1,592,490 Plan to Plan Resource Movement - (2,745) 2,463 -
Net Investment Income 34,672,500 5,030,896 1,150,020 23,744,382 Benefit Payments, Including
Refunds of Employee Contributions (16,352,903) (17,197,393) (17,877,775) (18,716,805) Administrative Expense - (251,346) (136,109) (317,989)
Other Miscellaneous Income/(Expense) - - - -
Net Change in Fiduciary Net Position 26,114,364 (4,529,416) (7,955,831) 14,734,033 Plan Fiduciary Net Position - Beginning 201,747,147 227,861,511 223,332,095 215,376,264 Plan Fiduciary Net Position - Ending (b) $ 227,861,511 $ 223,332,095 $ 215,376,264 $ 230,110,297 Plan Net Pension Liability/(Assets) - Ending (a) - (b) $ 80,545,625 $ 90,589,366 $ 107,689,881 $ 121,839,976
73.88% 71.14% 66.67% 65.38%
Covered Payroll $ 14,418,451 $ 15,122,058 $ 15,770,385 $ 16,424,748 558.63% 599.05% 682.86% 741.81%
Notes to Schedule:
Changes of Assumptions:
Plan Fiduciary Net Position as a Percentage of the Total Pension Liability
Plan Net Pension Liability/(Asset) as a Percentage of
Covered Payroll
Benefit Changes:
Effective with the June 30, 2021 valuation date (2022 measurement date), the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. Projected returns for all asset classes are estimated, combined with risk estimates, and are used to project comp ound (geometric) returns over the long term. The discount rate used to discount liabilities was informed by the long-term projected portfolio return. In addition, demographic assumptions and the inflation rate assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The ac counting discount rate was 7.15% for measurement dates 2017 through 2021, 7.65% for measurement dates 2015 through 2016, and 7.50% for measurement date 2014.
The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date. However, offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes) that occurred after the Valuation Date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary. (1) Historical information is required only for measurement years for which GASB 68 is applicable. Fiscal Year 2015 was the first year of implementation, therefore only nine years are shown.
75 DRAFT
2019 2020 2021 2022 2023
$ 5,468,356 $ 5,753,947 $ 5,883,763 $ 5,458,828 $ 6,249,142 24,611,566 25,990,861 26,796,647 27,413,478 27,763,771
817,752 9,616,039 968,299 (1,214,915) (1,796,249)
(1,235,646) - - - 11,089,291
(20,097,705) (20,998,140) (22,018,409) (23,233,659) (23,950,891) 9,564,323 20,362,707 11,630,300 8,423,732 19,355,064
351,950,273 361,514,596 381,877,303 393,507,603 401,931,335 $ 361,514,596 $ 381,877,303 $ 393,507,603 $ 401,931,335 $ 421,286,399 $ 9,310,708 $ 10,499,397 $ 11,860,288 $ 12,912,307 $ 155,865,005 1,887,216 1,753,382 1,816,584 1,789,951 1,976,975
(559) - - - -
19,399,983 15,582,752 12,249,408 56,472,719 (32,498,996) (20,097,705) (20,998,140) (22,018,409) (23,233,659) (23,950,891) (358,575) (170,963) (347,134) (249,533) (185,318)
(680,940) 559 - - -
9,460,128 6,666,987 3,560,737 47,691,785 101,206,775
230,110,297 239,570,425 246,237,412 249,798,149 297,489,934 $ 239,570,425 $ 246,237,412 $ 249,798,149 $ 297,489,934 $ 398,696,709 $ 121,944,171 $ 135,639,891 $ 143,709,454 $ 104,441,401 $ 22,589,690
66.27% 64.48% 63.48% 74.02% 94.64%
$ 17,552,942 $ 18,388,027 $ 18,508,977 $ 18,079,966 $ 15,212,797 694.72% 737.65% 776.43% 577.66% 148.49%
76 DRAFT
CITY OF REDONDO BEACH
Schedule of Plan Contributions
Safety Plan- Agent Multiple-Employer
As of June 30, For the Last Ten Fiscal Years (1)
2015 2016 2017 2018
Actuarially Determined Contribution $ 6,493,477 $ 7,448,335 $ 8,431,955 $ 9,310,585 Contribution in Relation to the Actuarially Determined Contribution (6,493,477) (7,448,335) (8,431,955) (9,310,585) Contribution Deficiency (Excess) $ - $ - $ - $ -
Covered Payroll $ 15,122,058 $ 15,770,385 $ 16,424,748 $ 17,552,942 Contributions as a Percentage of Covered Payroll 42.94% 47.23% 51.34% 53.04% Note to Schedule:
Valuation Date: June 30, 2021
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry Age Normal Cost Method
Amortization method Level percentage of payroll, closed Assets valuation method Fair Value of Assets.
Discount rate 6.90% (net of investment and administrative expenses) Projected Salary Increases
Inflation
Payroll growth
Varies by Entry Age and Service
2.50%
2.75%
(1) Historical information is required only for measurement for which GASB 68 is applicable. Fiscal Year 2015 was the first year of implementation, therefore only nine years are shown.
77 DRAFT
2019 2020 2021 2022 2023
$ 10,498,710 $ 11,860,372 $ 12,915,506 $ 9,558,876 $ 4,682,522 (10,498,710) (11,860,372) (12,915,506) (155,882,954) (4,682,522) $ - $ - $ - $ (146,324,078) $ -
$ 18,388,027 $ 18,508,977 $ 18,079,966 $ 15,212,797 $ 16,696,199
57.10% 64.08% 71.44% 1024.68% 28.05%
78 DRAFT
CITY OF REDONDO BEACH
Schedule of Changes in Net OPED Liability and Related Ratios As of June 30, For the Last Ten Fiscal Years (1)
2018 2019 2020
Total OPEB Liability
Service cost $ 560,000 $ 885,210 $ 911,766
Interest on the total OPEB liability 1,521,000 1,581,920 1,635,748 Actual and expected experience difference (3,502,000) - (147,110) Changes in assumptions 2,900,000 - (1,415,841)
Changes in benefit terms 2,593,000 - -
Benefit payments (2,002,000) (1,868,747) (1,523,667)
Net change in total OPEB liability 2,070,000 598,383 (539,104) Total OPEB liability - beginning 21,415,000 23,485,000 24,083,383 Total OPEB liability - ending (a) 23,485,000 24,083,383 23,544,279 Plan Fiduciary Net Position
Contribution - employer 1,428,000 2,191,008 2,217,998
Net investment income 632,000 469,710 497,289
Benefit payments (2,002,000) (1,868,747) (1,523,667)
Administrative expense (3,000) (9,679) (5,691)
Net change in plan fiduciary net position 55,000 782,292 1,185,929 Plan fiduciary net position - beginning 4,818,000 4,873,000 5,655,292 Plan fiduciary net position - ending (b) 4,873,000 5,655,292 6,841,221 Net OPEB Liability/(Assets) - ending (a) - (b) $ 18,612,000 $ 18,428,091 $ 16,703,058 Plan fiduciary net position as a percentage of the total OPEB liability 20.75% 23.48% 29.06% Covered-employee payroll $ 35,816,000 $ 36,708,000 $ 38,823,317 Net OPEB liability as a percentage of covered-employee payroll 51.97% 50.20% 43.02% Notes to Schedule: None
(1) Historical information is required only for the measurement periods for which GASB 75 is applicable. Fiscal Year 2018 was the first year of implementation. Future years' information will be displayed up to 10 years as information becomes available.
Changes in assumptions: The discount rate was updated based on newer capital market assuptions as of measurement date June 30, 2022. ACA excise tax was removed as of measurement date June 30, 2020. The discount rate was changed from 6.75 percent to 6.25 percent for the measurement period ended June 30, 2022. 79 DRAFT
2021 2022 2023
$ 854,481 $ 869,592 $ 732,825
1,592,234 1,620,655 1,351,025
- (3,732,173) -
(359,831) 700,641 -
- - -
(1,620,198) (1,741,685) -
466,686 (2,282,970) 2,083,850
23,544,279 24,010,965 21,727,995
24,010,965 21,727,995 23,811,845
2,214,831 1,975,728 2,024,400
300,557 2,465,620 (1,612,311)
(1,620,198) (1,741,685) -
(9,132) (8,390) (7,783)
886,058 2,691,273 404,306
6,841,221 7,727,279 10,418,552
7,727,279 10,418,552 10,822,858
$ 16,283,686 $ 11,309,443 $ 12,988,987
32.18% 47.95% 45.45%
$ 38,202,693 $ 37,142,464 $ 37,783,818
42.62% 30.45% 34.38%
80 DRAFT
CITY OF REDONDO BEACH
Schedule of Contributions
As of June 30, For the Last Ten Fiscal Years (1)
2018 2019 2020
$ 1,802,000 $ 2,217,998 $ 2,214,831
(705,000) (2,217,998) (2,214,831)
$ 1,097,000 $ - $ -
$ 36,708,000 $ 38,823,317 $ 38,202,693
4.91% 5.71% 5.80%
Methods and assumptions used to determine contributions:
Actuarial Cost Method
Amortization Valuation Method
Amortization Valuation Period
Asset Valuation Method
Discount Rate 6.25%
Inflation 2.50%
Mortality
Actuarially Determined Contribution
Contribution in Relation to the Actuarially Determined Contributions Contribution Deficiency (Excess)
Covered employee payroll
Contributions as a percentage of covered-employee payroll (1) Historical information is required only for the measurement periods for which GASB 75 is applicable. Fiscal Year 2018 was the first year of implementation. Future years' information will be displayed up to 10 years as information becomes available.
Mortality projected fully generational with Scale
MP-2021
Entry Age Normal
Level percent of payroll
16-year average remaining fixed period for
2022/23
Investment gains and losses spread over
5-year rolling period
81 DRAFT
2021 2022 2023
$ 1,975,728 $ 2,024,144 $ 1,822,393
(1,975,728) (2,024,144) (1,822,393)
$ - $ - $ -
$ 37,142,464 $ 37,783,818 $ 40,375,037
5.32% 5.36% 4.51%
82 DRAFT
SUPPLEMENTARY INFORMATION
83 DRAFT
CITY OF REDONDO BEACH
Notes to the Required Supplementary Information
For the Year Ended June 30, 2023
MODIFIED APPROACH FOR CITY STREETS INFRASTRUCTURE CAPITAL ASSETS In accordance with GASB Statement No. 34, the City is required to account for and report infrastructure capital assets. GASB Statement No. 34 defines infrastructure assets as "long-lived capital assets that are stationary in nature and normally can be preserved for a significantly greater number of years than most capital assets..." Major infrastructure systems include the street system, storm water system, sewer system, and traffic control system. Each major infrastructure system can be divided into subsystems. For example, the street system can be divided into concrete and asphalt pavements, concrete curb and gutters, sidewalks, medians, etc. Subsystem detail is not presented in these basic financial statements; however, the City maintains detailed information on these subsystems.
The City has elected to use the "Modified Approach" as defined by GASB Statement No. 34 for infrastructure reporting for its Streets Pavement System. Under GASB Statement No. 34, eligible infrastructure capital assets are not required to be depreciated under the following requirements:
The City manages the eligible infrastructure capital assets using an asset management system with characteristics of (1) an up-to-date inventory; (2) condition assessments which summarize results using a measurement scale; and (3) estimated annual amounts budgeted to maintain and preserve an established condition assessment level.
The City documents that the eligible infrastructure capital assets are being preserved approximately at or above the established and disclosed condition assessment level.
The City commissioned a physical assessment of the street conditions as of June 30, 2020. The study assisted the City by providing inspection data used to evaluate pavement condition. This helped to establish a City-defined target level of pavement performance, while optimizing the expenditure of limited fiscal resources.
The entire pavement network within the City is composed of approximately 125 centerline miles of paved surfaces. The City's street system can be grouped by function class as follows:
22 centerline miles of arterial, 5 centerline miles of collector and 98 centerline miles of residential.
In May 2020, a physical assessment of all pavement segments was conducted to assess the existing surface condition of each of the individual pavement segments based on the ASTEM D6433-11 standards for Pavement Condition Index (PCI). The PCI method only looks at distresses in the pavement since all of the City streets are structurally adequate and have speed limits less than 45mph. Evaluating the pavement based on PCI is a widely used standard in the United States, internationally, and commonly used by adjacent cities. This change allows the City to easily compare street conditions with comparable adjacent cities.
Upon completion of the study, the PCI was calculated for each segment in the City's pavement network to reflect the overall pavement condition. Ratings range from 0 to 100. A newly constructed street will have a PCI of 100, while a failed street will have a PCI of 25 or less. The pavement condition is primarily affected by the climate, traffic loads and volumes, construction materials and age. During the year, the comprehensive survey is updated to reflect the pavement's current condition. 84 DRAFT
CITY OF REDONDO BEACH
Notes to the Required Supplementary Information
For the Year Ended June 30, 2023
MODIFIED APPROACH FOR CITY STREETS INFRASTRUCTURE CAPITAL ASSETS The following conditions were defined:
Condition Rating
Very Good 70-100
Good 50-69
Poor 25-49
Very Poor 0-24
In line with the Capital Improvement Program and as presented to City Council on January 16, 2018, City policy is to achieve a citywide average rating of 75 PCI, by fiscal year 2027/28. This rating allows minor cracking and raveling of the pavement along with minor roughness that could be noticeable to drivers traveling at posted speeds.
The condition assessments for the most recent years since implementation are as follows:
The City expended $14,536,314 on street improvement projects for the fiscal year ended June 30, 2023. These capital improvements expenditures enhanced the condition of many streets and delayed deterioration on others.
The estimated expenditures required to maintain and improve the overall condition of the streets from July 1, 2023 through June 30, 2024 is a minimum of $4,620,000.
A schedule of budget versus actual for the most recent years since implementation, which preserved City streets at the current 68 PCI rating, is presented in the following:
Year PQI Rate Condition % of Streets
2021 70 PCI Very Good 52%
Good 34%
Poor 13%
Very Poor 1%
2022 69 PCI Very Good 49%
Good 34%
Poor 16%
Very Poor 1%
2023 68 PCI Very Good 49%
Good 35%
Poor 16%
Very Poor 0%
85 DRAFT
CITY OF REDONDO BEACH
Notes to the Required Supplementary Information
For the Year Ended June 30, 2023
MODIFIED APPROACH FOR CITY STREETS INFRASTRUCTURE CAPITAL ASSETS As of June 30, 2023, 50% of City streets were rated below the targeted average condition level of 75 PCI. However, as noted above, the City is investing in these infrastructure assets as part of the five-year Capital Improvement Program and will continue to rehabilitate and maintain its streets in order to achieve this goal.
General Fund Other Fund Total
Project Project # Budget Expenditures Expenditures Expenditures Residential Street Rehabilitation 40190 4,052,098 444,538 3,294,689 3,739,227 Citywide Curb Ramp Improvements 40399 408,510 - 37,804 37,804 Traffic Calming Project 40470 1,243,425 84,514 153,721 238,235 Bicycle Trans Plan Implementation 40510 219,427 - 81,958 81,958 Artesia/Aviation NB Rt Turn Lane 40780 1,413,728 - 68,554 68,554 PCH Study Recommendations 40800 1,046,648 - 9,537 9,537 Kingsdale Resurfacing- 182nd/Grant Ave 40880 456,118 - 35,072 35,072 Bike Plan Grant - Beryl St. Bike Lanes 40940 136,829 - - - Bike Plan Grant - N Catalina Bikelane 40941 414,370 - - - Bike Plan Grant - S Catalina/I Bikelane 40942 44,640 - - - Bike Plan Grant - Lilienthal Bikelane 40943 282,525 - - - Bike Plan Grant - Torrance Blvd Bike Lane 40944 215,790 - - - Bike Plan Grant - Citywide Bike Facilities 40945 853,340 - - - Inglewood at MBB Rt Turn Lane Feasibility 40960 4,205,807 - 1,389,044 1,389,044 Torrance Blvd & Francisca Traffic Signal Mod 41070 256,061 - 251,788 251,788 Artesia Blvd Improvements - Phase 1 41080 169,943 - - - Grant Ave Signal Improvements 41090 998,418 - 28,342 28,342 Median Reno - PV Blvd/Prospect/MBB 41110 101,543 13,723 - 13,723 Beryl Resurfacing & Drainage - Prospect to Flag 41130 2,756,636 927,785 1,872,845 2,800,630 Citywide Slurry Seal Program 41140 894,571 10,000 8,030 18,030 Kingsdale Avenue Widening 41150 977,153 - 1,528,324 1,528,324 Manhattan Beach Boulevard Resurfacing 41160 2,694,955 - 109,477 109,477 Citywide Striping 41180 508,670 97,145 248,670 345,815
Artesia Blvd Resurfacing - Harper to Hawthorne 41190 1,496,790 - - - Citywide Traffic Signal Upgrades 41200 112,609 16,370 - 16,370 Inglewood Ave Resurfacing - Marine to MBB 41210 130,000 - - - RB Blvd Resurfacing - Artesia to Hawthorne 41220 70,000 - - - Torrance Blvd Resurfacing - PCH to Prospect 41230 4,241,209 - 1,962,247 1,962,247 Anita/Herondo & PCH WB RT Turn Lane 41240 2,500,000 - - - NRB Bikeway Ext - Felton to Inglewood 41250 1,000,000 - - - NRB Bikeway Ext - Inglewood Design 41260 200,000 - 1,936 1,936 Sidewalk Improvements & Repairs 41270 461,160 117,561 - 117,561 Traffic Signal Comm & Network System 41280 2,000,000 - 371,360 371,360 Dow/Vail/Johnston Bicylce Implementaiton Plan 41290 150,000 - 6,500 6,500 Residential Street Reconstruction-Deferred Maintenance 41300 1,500,000 - 750,000 750,000 Riviera Village Sidewalk Pavers 41310 300,000 14,320 - 14,320 Garnet Resurfacing- Broadway to Francisca 41320 250,000 250,000 - 250,000 Artesia Intesection Safety Implementation 41330 389,490 - 8,665 8,665 Grant Ave Bulb-outs 41340 375,000 - - -
Grant Ave Flash Crosswalks 41350 75,000 - - -
Alleyway Resurfacing with PCI<25 41370 320,000 - - -
Avenue I Resurfacing 41380 400,000 131,794 210,000 341,794 40,322,463 2,107,750 12,428,564 14,536,314
86 DRAFT
CITY OF REDONDO BEACH
Combining Balance Sheet
Non-Major Governmental Funds
June 30, 2023
Assets:
Pooled cash and investments $ 2,501,555 $ 99,643 $ 192,764 $ 2,631,849 Receivables:
Accounts 3,372 - - -
Taxes 428,746 - - -
Notes and loans - - - -
Accrued interest 10,847 - 2,518 9,688
Leases - - - -
Due from other governments - - - -
Due from other funds - - - -
Restricted assets:
Cash and investments with fiscal agents - - - -
Total Assets $ 2,944,520 $ 99,643 $ 195,282 $ 2,641,537 Liabilities, Deferred Inflows of Resources,
and Fund Balances:
Liabilities:
Accounts payable $ 217,386 $ - $ 11,965 $ -
Due to other funds - - - -
Total Liabilities 217,386 - 11,965 -
Deferred Inflows of Resources:
Unavailable revenues - - - -
Deferred leases related items
Total Deferred Inflows of Resources - - - -
Fund Balances:
Restricted for:
Housing and community development - 99,643 - 2,641,537
Public safety - - 183,317 -
Public works 2,727,134 - - -
Debt service - - - -
Low and moderate income housing - - - -
Assigned to:
Capital projects - - - -
Unassigned - - - -
Total Fund Balances 2,727,134 99,643 183,317 2,641,537
Total Liabilities, Deferred Inflows of
Resources, and Fund Balances $ 2,944,520 $ 99,643 $ 195,282 $ 2,641,537 Special Revenue Funds
State Gas Tax
Parks and
Recreation
Facilities
Narcotic
Seizure /
Forfeiture Proposition A
87 DRAFT
CITY OF REDONDO BEACH
Combining Balance Sheet
Non-Major Governmental Funds
June 30, 2023
Assets:
Pooled cash and investments
Receivables:
Accounts
Taxes
Notes and loans
Accrued interest
Leases
Due from other governments
Due from other funds
Restricted assets:
Cash and investments with fiscal agents
Total Assets
Liabilities, Deferred Inflows of Resources,
and Fund Balances:
Liabilities:
Accounts payable
Due to other funds
Total Liabilities
Deferred Inflows of Resources:
Unavailable revenues
Deferred leases related items
Total Deferred Inflows of Resources
Fund Balances:
Restricted for:
Housing and community development
Public safety
Public works
Debt service
Low and moderate income housing
Assigned to:
Capital projects
Unassigned
Total Fund Balances
Total Liabilities, Deferred Inflows of
Resources, and Fund Balances
(CONTINUED)
$ 4,075,024 $ 1,830,354 $ - $ 257,858
- - - -
- - - -
- - - -
21,115 - - 1,214
- - - -
- - - 23,003
- - - -
- - - -
$ 4,096,139 $ 1,830,354 $ - $ 282,075
$ 367,668 $ 35,834 $ - $ 588
- - 907 -
367,668 35,834 907 588
- - - -
- - - -
3,728,471 1,794,520 - 281,487
- - - -
- - - -
- - - -
- - - -
- - - -
- - (907) -
3,728,471 1,794,520 (907) 281,487
$ 4,096,139 $ 1,830,354 $ - $ 282,075
Special Revenue Funds
Proposition C Measure R
Local
Transportation
Article 3
Air Quality
Improvement
88 DRAFT
CITY OF REDONDO BEACH
Combining Balance Sheet
Non-Major Governmental Funds
June 30, 2023
Assets:
Pooled cash and investments
Receivables:
Accounts
Taxes
Notes and loans
Accrued interest
Leases
Due from other governments
Due from other funds
Restricted assets:
Cash and investments with fiscal agents
Total Assets
Liabilities, Deferred Inflows of Resources,
and Fund Balances:
Liabilities:
Accounts payable
Due to other funds
Total Liabilities
Deferred Inflows of Resources:
Unavailable revenues
Deferred leases related items
Total Deferred Inflows of Resources
Fund Balances:
Restricted for:
Housing and community development
Public safety
Public works
Debt service
Low and moderate income housing
Assigned to:
Capital projects
Unassigned
Total Fund Balances
Total Liabilities, Deferred Inflows of
Resources, and Fund Balances
$ 245,955 $ 226,168 $ - $ 321,736
- 600 - -
- 27,059 - -
- - 326,227 -
- - - -
- - - -
- - 235,757 -
- - - -
- - - -
$ 245,955 $ 253,827 $ 561,984 $ 321,736
$ 11,540 $ 140,507 $ 25,081 $ 9,418
- - 25,528 -
11,540 140,507 50,609 9,418
- - 538,428 -
- - 538,428 -
- 113,320 - -
- - - 312,318
234,415 - - -
- - - -
- - - -
- - - -
- - (27,053) -
234,415 113,320 (27,053) 312,318
$ 245,955 $ 253,827 $ 561,984 $ 321,736
Special Revenue Funds
Storm Drain
Improvement
Street
Landscaping
and Lighting
District
Community
Development
Block Grant
Disaster
Recovery
89 DRAFT
CITY OF REDONDO BEACH
Combining Balance Sheet
Non-Major Governmental Funds
June 30, 2023
Assets:
Pooled cash and investments
Receivables:
Accounts
Taxes
Notes and loans
Accrued interest
Leases
Due from other governments
Due from other funds
Restricted assets:
Cash and investments with fiscal agents
Total Assets
Liabilities, Deferred Inflows of Resources,
and Fund Balances:
Liabilities:
Accounts payable
Due to other funds
Total Liabilities
Deferred Inflows of Resources:
Unavailable revenues
Deferred leases related items
Total Deferred Inflows of Resources
Fund Balances:
Restricted for:
Housing and community development
Public safety
Public works
Debt service
Low and moderate income housing
Assigned to:
Capital projects
Unassigned
Total Fund Balances
Total Liabilities, Deferred Inflows of
Resources, and Fund Balances
(CONTINUED)
$ 2,080,394 $ 3,765,883 $ 2,271,817 $ 851,963
- - - -
- - - -
- - - -
- - 10,582 -
- - - -
- - - -
- - - -
- - - -
$ 2,080,394 $ 3,765,883 $ 2,282,399 $ 851,963
$ - $ 18,321 $ 172,748 $ 16,360
723,593 - - -
723,593 18,321 172,748 16,360
- - - -
- - - -
- 3,747,562 - -
- - - -
- - 2,109,651 835,603
- - - -
1,356,801 - - -
- - - -
- - - -
1,356,801 3,747,562 2,109,651 835,603
$ 2,080,394 $ 3,765,883 $ 2,282,399 $ 851,963
Special Revenue Funds
Housing
Authority
Subdivision
Park Trust Measure M Measure W
90 DRAFT
CITY OF REDONDO BEACH
Combining Balance Sheet
Non-Major Governmental Funds
June 30, 2023
Assets:
Pooled cash and investments
Receivables:
Accounts
Taxes
Notes and loans
Accrued interest
Leases
Due from other governments
Due from other funds
Restricted assets:
Cash and investments with fiscal agents
Total Assets
Liabilities, Deferred Inflows of Resources,
and Fund Balances:
Liabilities:
Accounts payable
Due to other funds
Total Liabilities
Deferred Inflows of Resources:
Unavailable revenues
Deferred leases related items
Total Deferred Inflows of Resources
Fund Balances:
Restricted for:
Housing and community development
Public safety
Public works
Debt service
Low and moderate income housing
Assigned to:
Capital projects
Unassigned
Total Fund Balances
Total Liabilities, Deferred Inflows of
Resources, and Fund Balances
$ 7,443,909 $ 831 $ 633,994 $ 1,217,121
122,452 - - -
- - - -
- - - -
- - - -
- - - -
- - - -
3,866,527 - - -
- - - -
$ 11,432,888 $ 831 $ 633,994 $ 1,217,121
$ 324,326 $ - $ - $ -
- - - -
324,326 - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
11,108,562 831 633,994 1,217,121
- - - -
11,108,562 831 633,994 1,217,121
$ 11,432,888 $ 831 $ 633,994 $ 1,217,121
Capital Projects Funds
Capital
Improvement
Projects
Pier Parking
Structure
Rehabilitation
Major Facilities
Reconstruction
Open Space
Acquisition
91 DRAFT
CITY OF REDONDO BEACH
Combining Balance Sheet
Non-Major Governmental Funds
June 30, 2023
Assets:
Pooled cash and investments
Receivables:
Accounts
Taxes
Notes and loans
Accrued interest
Leases
Due from other governments
Due from other funds
Restricted assets:
Cash and investments with fiscal agents
Total Assets
Liabilities, Deferred Inflows of Resources,
and Fund Balances:
Liabilities:
Accounts payable
Due to other funds
Total Liabilities
Deferred Inflows of Resources:
Unavailable revenues
Deferred leases related items
Total Deferred Inflows of Resources
Fund Balances:
Restricted for:
Housing and community development
Public safety
Public works
Debt service
Low and moderate income housing
Assigned to:
Capital projects
Unassigned
Total Fund Balances
Total Liabilities, Deferred Inflows of
Resources, and Fund Balances
Debt Service
Funds
Debt Service
Funds
$ 3,889,712 $ 6,146 $ 34,544,676
3,743 - 130,167
- - 455,805
- - 326,227
1,419 41 57,424
1,287,795 - 1,287,795
5,158,621 - 5,417,381
544,986 - 4,411,513
57,324 - 57,324
$ 10,943,600 $ 6,187 $ 46,688,312
$ 36,625 $ - $ 1,388,367
4,268,178 - 5,018,206
4,304,803 - 6,406,573
- - 538,428
1,269,597 1,269,597
1,269,597 - 1,808,025
- - 12,406,540
- - 495,635
- - 5,906,803
5,369,200 6,187 5,375,387
- - 1,356,801
- - 12,960,508
- - (27,960)
5,369,200 6,187 38,473,714
$ 10,943,600 $ 6,187 $ 46,688,312
Parking
Authority
Public
Financing
Authority
Total Other
Governmental
Funds
92 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Revenues,
Expenditures and Changes in Fund Balances
Non-Major Governmental Funds
Year Ended June 30, 2023
Revenues:
Taxes $ - $ - $ - $ -
Intergovernmental 3,326,711 - - 1,747,512
Charges for services - 20,000 - -
Use of money and property 36,699 - 164 28,275
Fines and forfeitures - - 6,000 -
Miscellaneous 13,578 - - -
Total Revenues 3,376,988 20,000 6,164 1,775,787
Expenditures:
Current:
General government - - - -
Public safety - - 158,869 -
Housing and community development - - - -
Culture and leisure services - - - -
Public works 1,714,699 - - -
Capital outlay 1,970,359 - 26,048 -
Debt service:
Principal retirement - - 23,870 -
Interest and fiscal charges - - 1,479 -
Total Expenditures 3,685,058 - 210,266 -
Excess (Deficiency) of Revenues
Over (Under) Expenditures (308,070) 20,000 (204,102) 1,775,787 Other Financing Sources (Uses):
Transfers in - - - -
Transfers out - - - (1,510,726)
Subscription financing - - 118,410 -
Total Other Financing Sources (Uses): - - 118,410 (1,510,726) Net Change in Fund Balances (308,070) 20,000 (85,692) 265,061 Fund Balances, Beginning of Year 3,035,204 79,643 269,009 2,376,476 Fund Balances, End of Year $ 2,727,134 $ 99,643 $ 183,317 $ 2,641,537 Special Revenue Funds
State Gas Tax
Parks and
Recreation
Facilities
Narcotic
Seizure /
Forfeiture Proposition A
93 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Revenues,
Expenditures and Changes in Fund Balances
Non-Major Governmental Funds
Year Ended June 30, 2023
Revenues:
Taxes
Intergovernmental
Charges for services
Use of money and property
Fines and forfeitures
Miscellaneous
Total Revenues
Expenditures:
Current:
General government
Public safety
Housing and community development
Culture and leisure services
Public works
Capital outlay
Debt service:
Principal retirement
Interest and fiscal charges
Total Expenditures
Excess (Deficiency) of Revenues
Over (Under) Expenditures
Other Financing Sources (Uses):
Transfers in
Transfers out
Subscription financing
Total Other Financing Sources (Uses):
Net Change in Fund Balances
Fund Balances, Beginning of Year
Fund Balances, End of Year
(CONTINUED)
$ - $ - $ - $ -
1,449,511 1,086,820 - 91,027
- - - -
98,215 46,168 - 749
- - - -
- - - -
1,547,726 1,132,988 - 91,776
- - - -
- - - -
- - - 32,964
566 562 - -
3,900 2,144 - -
4,103,976 1,387,955 - -
- - - -
- - - -
4,108,442 1,390,661 - 32,964
(2,560,716) (257,673) - 58,812
- - - -
- - - -
- - - -
- - - -
(2,560,716) (257,673) - 58,812
6,289,187 2,052,193 (907) 222,675
$ 3,728,471 $ 1,794,520 $ (907) $ 281,487
Proposition C Measure R
Local
Transportation
Article 3
Air Quality
Improvement
Special Revenue Funds
94 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Revenues,
Expenditures and Changes in Fund Balances
Non-Major Governmental Funds
Year Ended June 30, 2023
Revenues:
Taxes
Intergovernmental
Charges for services
Use of money and property
Fines and forfeitures
Miscellaneous
Total Revenues
Expenditures:
Current:
General government
Public safety
Housing and community development
Culture and leisure services
Public works
Capital outlay
Debt service:
Principal retirement
Interest and fiscal charges
Total Expenditures
Excess (Deficiency) of Revenues
Over (Under) Expenditures
Other Financing Sources (Uses):
Transfers in
Transfers out
Subscription financing
Total Other Financing Sources (Uses):
Net Change in Fund Balances
Fund Balances, Beginning of Year
Fund Balances, End of Year
$ - $ - $ - $ -
- - 163,840 -
33,660 1,512,590 - 339
- - - -
- - - -
- 4,914 - 17,630
33,660 1,517,504 163,840 17,969
- - - -
- - - 16,854
- - 84,235 -
- - - -
- 2,676,692 - 500
258,592 - 37,804 -
- - - -
- - - -
258,592 2,676,692 122,039 17,354
(224,932) (1,159,188) 41,801 615
- 1,272,508 - -
- - - -
- - - -
- 1,272,508 - -
(224,932) 113,320 41,801 615
459,347 - (68,854) 311,703
$ 234,415 $ 113,320 $ (27,053) $ 312,318
Storm Drain
Improvement
Street
Landscaping
and Lighting
District
Community
Development
Block Grant
Disaster
Recovery
Special Revenue Funds
95 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Revenues,
Expenditures and Changes in Fund Balances
Non-Major Governmental Funds
Year Ended June 30, 2023
Revenues:
Taxes
Intergovernmental
Charges for services
Use of money and property
Fines and forfeitures
Miscellaneous
Total Revenues
Expenditures:
Current:
General government
Public safety
Housing and community development
Culture and leisure services
Public works
Capital outlay
Debt service:
Principal retirement
Interest and fiscal charges
Total Expenditures
Excess (Deficiency) of Revenues
Over (Under) Expenditures
Other Financing Sources (Uses):
Transfers in
Transfers out
Subscription financing
Total Other Financing Sources (Uses):
Net Change in Fund Balances
Fund Balances, Beginning of Year
Fund Balances, End of Year
(CONTINUED)
$ - $ - $ - $ -
7,338,128 - 1,229,425 718,133
- - - -
2,073 - 54,697 -
- - - -
- 2,087,500 - -
7,340,201 2,087,500 1,284,122 718,133
- - - -
- - - -
7,564,464 - - -
- - - -
- - - 213,364
- 415,372 2,569,079 14,879
- - - -
- - - -
7,564,464 415,372 2,569,079 228,243
(224,263) 1,672,128 (1,284,957) 489,890
- - - -
- - - -
- - - -
- - - -
(224,263) 1,672,128 (1,284,957) 489,890
1,581,064 2,075,434 3,394,608 345,713
$ 1,356,801 $ 3,747,562 $ 2,109,651 $ 835,603
Special Revenue Funds
Housing
Authority
Subdivision
Park Trust Measure M Measure W
96 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Revenues,
Expenditures and Changes in Fund Balances
Non-Major Governmental Funds
Year Ended June 30, 2023
Revenues:
Taxes
Intergovernmental
Charges for services
Use of money and property
Fines and forfeitures
Miscellaneous
Total Revenues
Expenditures:
Current:
General government
Public safety
Housing and community development
Culture and leisure services
Public works
Capital outlay
Debt service:
Principal retirement
Interest and fiscal charges
Total Expenditures
Excess (Deficiency) of Revenues
Over (Under) Expenditures
Other Financing Sources (Uses):
Transfers in
Transfers out
Subscription financing
Total Other Financing Sources (Uses):
Net Change in Fund Balances
Fund Balances, Beginning of Year
Fund Balances, End of Year
$ 185,457 $ - $ - $ -
812,381 - - -
314,043 - - -
- - - -
- - - -
8,000 - - -
1,319,881 - - -
- - - 3,257
- - - -
- - - -
- - - -
158,495 - - -
3,304,922 - 19,220 82,198
- - - -
- - - -
3,463,417 - 19,220 85,455
(2,143,536) - (19,220) (85,455)
- - - -
- - - -
- - - -
- - - -
(2,143,536) - (19,220) (85,455)
13,252,098 831 653,214 1,302,576
$ 11,108,562 $ 831 $ 633,994 $ 1,217,121
Capital Project Funds
Capital
Improvement
Projects
Pier Parking
Structure
Rehabilitation
Major Facilities
Reconstruction
Open Space
Acquisition
97 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Revenues,
Expenditures and Changes in Fund Balances
Non-Major Governmental Funds
Year Ended June 30, 2023
Revenues:
Taxes
Intergovernmental
Charges for services
Use of money and property
Fines and forfeitures
Miscellaneous
Total Revenues
Expenditures:
Current:
General government
Public safety
Housing and community development
Culture and leisure services
Public works
Capital outlay
Debt service:
Principal retirement
Interest and fiscal charges
Total Expenditures
Excess (Deficiency) of Revenues
Over (Under) Expenditures
Other Financing Sources (Uses):
Transfers in
Transfers out
Subscription financing
Total Other Financing Sources (Uses):
Net Change in Fund Balances
Fund Balances, Beginning of Year
Fund Balances, End of Year
Total Other
Governmental
Funds
$ - $ - $ 185,457
- - 17,963,488
- - 1,880,632
713,924 126 981,090
- - 6,000
- - 2,131,622
713,924 126 23,148,289
- - 3,257
- - 175,723
405,981 - 8,087,644
- - 1,128
- - 4,769,794
- - 14,190,404
7,148,148 - 7,172,018
5,914,848 - 5,916,327
13,468,977 - 40,316,295
(12,755,053) 126 (17,168,006)
13,089,301 - 14,361,809
- - (1,510,726)
- - 118,410
13,089,301 - 12,969,493
334,248 126 (4,198,513)
5,034,952 6,061 42,672,227
$ 5,369,200 $ 6,187 $ 38,473,714
Parking
Authority
Debt Service Funds
Public
Financing
Authority
98 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
State Gas Tax
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $3,035,204 $ 3,035,204 $ 3,035,204 $ - Resources (Inflows):
Intergovernmental 3,449,852 3,449,852 3,326,711 (123,141) Use of money and property 20,000 20,000 36,699 16,699
Miscellaneous 6,000 6,000 13,578 7,578
Transfers in 147 147 - (147)
Amounts Available for Appropriations 6,511,203 6,511,203 6,412,192 (99,011) Charges to Appropriation (Outflow):
Public works 1,936,218 1,885,155 1,714,699 170,456
Capital outlay 1,340,000 3,020,591 1,970,359 1,050,232
Debt service:
Principal retirement 44,351 44,351 - 44,351
Interest and fiscal charges 32,821 32,821 - 32,821
Total Charges to Appropriations 3,353,390 4,982,918 3,685,058 1,297,860 Budgetary Fund Balance, June 30 $3,157,813 $ 1,528,285 $ 2,727,134 $ 1,198,849 99 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Parks and Recreation Facilities
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ 79,643 $ 79,643 $ 79,643 $ - Resources (Inflows):
Charges for services 31,500 31,500 20,000 (11,500)
Amounts Available for Appropriations 111,143 111,143 99,643 (11,500) Charges to Appropriation (Outflow):
Capital outlay - 100,000 - 100,000
Total Charges to Appropriations - 100,000 - 100,000
Budgetary Fund Balance, June 30 $ 111,143 $ 11,143 $ 99,643 $ 88,500 100 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Narcotic Seizure / Forfeiture
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ 269,009 $ 269,009 $ 269,009 $ - Resources (Inflows):
Use of money and property 10,000 10,000 164 (9,836)
Fines and forfeitures 20,000 20,000 6,000 (14,000)
Transfers in 5,742 5,742 - (5,742)
Amounts Available for Appropriations 304,751 304,751 393,583 88,832 Charges to Appropriation (Outflow):
Public safety 66,872 169,505 158,869 10,636
Capital outlay - 563 26,048 (25,485)
Debt service:
Principal retirement - - 23,870 (23,870)
Interest and fiscal charges - - 1,479 (1,479)
Total Charges to Appropriations 66,872 170,068 210,266 (40,198) Budgetary Fund Balance, June 30 $ 237,879 $ 134,683 $ 183,317 $ 48,634 101 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Proposition A
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $2,376,476 $ 2,376,476 $ 2,376,476 $ - Resources (Inflows):
Intergovernmental 1,621,996 1,621,996 1,747,512 125,516 Use of money and property 30,000 30,000 28,275 (1,725)
Amounts Available for Appropriations 4,028,472 4,028,472 4,152,263 123,791 Charges to Appropriation (Outflow):
Capital outlay - 75,000 - 75,000
Transfers out 993,724 993,724 1,510,726 (517,002)
Total Charges to Appropriations 993,724 1,068,724 1,510,726 (442,002) Budgetary Fund Balance, June 30 $3,034,748 $ 2,959,748 $ 2,641,537 $ (318,211) 102 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Proposition C
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $6,289,187 $ 6,289,187 $ 6,289,187 $ - Resources (Inflows):
Intergovernmental 1,345,403 1,345,403 1,449,511 104,108 Use of money and property 120,000 120,000 98,215 (21,785) Amounts Available for Appropriations 7,754,590 7,754,590 7,836,913 82,323 Charges to Appropriation (Outflow):
Cultural and leisure services 343 566 566 -
Public works 1,262 3,900 3,900 -
Capital outlay 1,500,000 5,446,287 4,103,976 1,342,311
Total Charges to Appropriations 1,501,605 5,450,753 4,108,442 1,342,311 Budgetary Fund Balance, June 30 $6,252,985 $ 2,303,837 $ 3,728,471 $ 1,424,634 103 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Measure R
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $2,052,193 $ 2,052,193 $ 2,052,193 $ - Resources (Inflows):
Intergovernmental 1,009,052 1,009,052 1,086,820 77,768
Use of money and property 15,000 15,000 46,168 31,168
Amounts Available for Appropriations 3,076,245 3,076,245 3,185,181 108,936 Charges to Appropriation (Outflow):
Parks and recreation - 562 562 -
Public works - 2,144 2,144 -
Capital outlay 1,135,000 2,850,046 1,387,955 1,462,091
Total Charges to Appropriations 1,135,000 2,852,752 1,390,661 1,462,091 Budgetary Fund Balance, June 30 $1,941,245 $ 223,493 $ 1,794,520 $ 1,571,027 104 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Local Transportation Article 3
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ (907) $ (907) $ (907) $ - Resources (Inflows):
Intergovernmental 62,594 62,594 - (62,594)
Amounts Available for Appropriations 61,687 61,687 (907) (62,594) Charges to Appropriation (Outflow):
Capital outlay 62,594 64,843 - 64,843
Total Charges to Appropriations 62,594 64,843 - 64,843
Budgetary Fund Balance, June 30 $ (907) $ (3,156) $ (907) $ 2,249 105 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Air Quality Improvement
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ 222,675 $ 222,675 $ 222,675 $ - Resources (Inflows):
Intergovernmental 88,000 88,000 91,027 3,027
Use of money and property 2,000 2,000 749 (1,251)
Transfers in 45 45 - (45)
Amounts Available for Appropriations 312,720 312,720 314,451 1,731 Charges to Appropriation (Outflow):
Cultural and leisure services 69,499 66,022 32,964 33,058 Capital outlay - 41,400 - 41,400
Debt service:
Principal retirement 1,919 1,919 - 1,919
Interest and fiscal charges 1,420 1,420 - 1,420
Total Charges to Appropriations 72,838 110,761 32,964 77,797 Budgetary Fund Balance, June 30 $ 239,882 $ 201,959 $ 281,487 $ 79,528 106 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Storm Drain Improvement
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ 459,347 $ 459,347 $ 459,347 $ - Resources (Inflows):
Charges for services 30,000 30,000 33,660 3,660
Amounts Available for Appropriations 489,347 489,347 493,007 3,660 Charges to Appropriation (Outflow):
Capital outlay - 287,017 258,592 28,425
Total Charges to Appropriations - 287,017 258,592 28,425 Budgetary Fund Balance, June 30 $ 489,347 $ 202,330 $ 234,415 $ 32,085 107 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Street Landscaping and Lighting District
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ - $ - $ - $ -
Resources (Inflows):
Charges for services 1,523,600 1,523,600 1,512,590 (11,010) Miscellaneous 7,000 7,000 4,914 (2,086)
Transfers in 1,382,194 1,382,194 1,272,508 (109,686)
Amounts Available for Appropriations 2,912,794 2,912,794 2,790,012 (122,782) Charges to Appropriation (Outflow):
Public works 2,815,344 2,787,031 2,676,692 110,339
Debt service:
Principal retirement 56,005 56,005 - 56,005
Interest and fiscal charges 41,445 41,445 - 41,445
Total Charges to Appropriations 2,912,794 2,884,481 2,676,692 207,789 Budgetary Fund Balance, June 30 $ - $ 28,313 $ 113,320 $ 85,007 108 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Community Development Block Grant
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ (68,854) $ (68,854) $ (68,854) $ - Resources (Inflows):
Intergovernmental 285,916 285,916 163,840 (122,076)
Amounts Available for Appropriations 217,062 217,062 94,986 (122,076) Charges to Appropriation (Outflow):
Housing and community development 140,071 140,071 84,235 55,836 Capital outlay 145,845 265,743 37,804 227,939
Total Charges to Appropriations 285,916 405,814 122,039 283,775 Budgetary Fund Balance, June 30 $ (68,854) $ (188,752) $ (27,053) $ 161,699 109 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Disaster Recovery
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ 311,703 $ 311,703 $ 311,703 $ - Resources (Inflows):
Charges for services 1,000 1,000 339 (661)
Miscellaneous 50,000 50,000 17,630 (32,370)
Amounts Available for Appropriations 362,703 362,703 329,672 (33,031) Charges to Appropriation (Outflow):
Public safety 17,060 24,439 16,854 7,585
Public works - - 500 (500)
Total Charges to Appropriations 17,060 24,439 17,354 7,085 Budgetary Fund Balance, June 30 $ 345,643 $ 338,264 $ 312,318 $ (25,946) 110 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Housing Authority
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $1,581,064 $ 1,581,064 $ 1,581,064 $ - Resources (Inflows):
Intergovernmental 6,627,168 6,627,168 7,338,128 710,960 Use of money and property - - 2,073 2,073
Transfers in 298 298 - (298)
Amounts Available for Appropriations 8,208,530 8,208,530 8,921,265 712,735 Charges to Appropriation (Outflow):
Housing and community development 6,728,170 6,737,666 7,564,464 (826,798) Total Charges to Appropriations 6,728,170 6,737,666 7,564,464 (826,798) Budgetary Fund Balance, June 30 $1,480,360 $ 1,470,864 $ 1,356,801 $ (114,063) 111 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Subdivision Park Trust
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $2,075,434 $ 2,075,434 $ 2,075,434 $ - Resources (Inflows):
Miscellaneous 1,162,500 1,162,500 2,087,500 925,000
Amounts Available for Appropriations 3,237,934 3,237,934 4,162,934 925,000 Charges to Appropriation (Outflow):
Capital outlay 741,025 2,449,657 415,372 2,034,285
Total Charges to Appropriations 741,025 2,449,657 415,372 2,034,285 Budgetary Fund Balance, June 30 $2,496,909 $ 788,277 $ 3,747,562 $ 2,959,285 112 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Measure M
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $3,394,608 $ 3,394,608 $ 3,394,608 $ - Resources (Inflows):
Intergovernmental 1,143,593 1,143,593 1,229,425 85,832
Use of money and property 30,000 30,000 54,697 24,697
Amounts Available for Appropriations 4,568,201 4,568,201 4,678,730 110,529 Charges to Appropriation (Outflow):
Capital outlay 1,300,342 3,451,163 2,569,079 882,084
Total Charges to Appropriations 1,300,342 3,451,163 2,569,079 882,084 Budgetary Fund Balance, June 30 $3,267,859 $ 1,117,038 $ 2,109,651 $ 992,613 113 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Measure W
Year ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ 345,713 $ 345,713 $ 345,713 $ - Resources (Inflows):
Intergovernmental 720,000 720,000 718,133 (1,867)
Amounts Available for Appropriations 1,065,713 1,065,713 1,063,846 (1,867) Charges to Appropriation (Outflow):
Public works 230,578 252,947 213,364 39,583
Capital outlay 500,000 1,371,527 14,879 1,356,648
Debt service:
Principal retirement 6,618 6,618 - 6,618
Interest and fiscal charges 4,897 4,897 - 4,897
Total Charges to Appropriations 742,093 1,635,989 228,243 1,407,746 Budgetary Fund Balance, June 30 $ 323,620 $ (570,276) $ 835,603 $ 1,405,879 114 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Capital Improvement Projects
Year Ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ 13,252,098 $ 13,252,098 $ 13,252,098 $ - Resources (Inflows):
Taxes 180,000 180,000 185,457 5,457
Intergovernmental 812,381 812,381 812,381 -
Charges for services 311,370 311,370 314,043 2,673
Miscellaneous - - 8,000 8,000
Amounts Available for Appropriations 14,555,849 14,555,849 14,571,979 16,130 Charges to Appropriation (Outflow):
Public works 151,851 180,109 158,495 21,614
Capital outlay 3,214,021 11,607,229 3,304,922 8,302,307 Debt service:
Principal retirement 13,085 13,085 - 13,085
Interest and fiscal charges 9,683 9,683 - 9,683
Total Charges to Appropriations 3,388,640 11,810,106 3,463,417 8,346,689 Budgetary Fund Balance, June 30 $ 11,167,209 $ 2,745,743 $ 11,108,562 $ 8,362,819 115 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Major Facilities Reconstruction
Year Ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ 653,214 $ 653,214 $ 653,214 $ - Resources (Inflows):
Transfers in 500,000 500,000 - (500,000)
Amounts Available for Appropriation 1,153,214 1,153,214 653,214 (500,000) Charges to Appropriation (Outflow):
Capital outlay - 608,750 19,220 589,530
Total Charges to Appropriations - 608,750 19,220 589,530 Budgetary Fund Balance, June 30 $1,153,214 $ 544,464 $ 633,994 $ 89,530 116 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Open Space Acquisition
Year Ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $1,302,576 $ 1,302,576 $ 1,302,576 $ - Resources (Inflows):
Transfers in 500,000 500,000 - (500,000)
Amounts Available for Appropriations 1,802,576 1,802,576 1,302,576 (500,000) Charges to Appropriation (Outflow):
General government - 18,047 3,257 14,790
Capital outlay 476,000 661,380 82,198 579,182
Total Charges to Appropriations 476,000 679,427 85,455 593,972 Budgetary Fund Balance, June 30 $1,326,576 $ 1,123,149 $ 1,217,121 $ 93,972 117 DRAFT
CITY OF REDONDO BEACH
Budgetary Comparison Schedule
Public Financing Authority
Year Ended June 30, 2023
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 $ 5,034,952 $ 5,034,952 $ 5,034,952 $ - Resources (Inflows):
Use of money and property 273,975 273,975 713,924 439,949 Miscellaneous 13,102,314 13,102,314 - (13,102,314)
Transfers in 1,650,738 1,650,738 13,089,301 11,438,563
Amounts Available for Appropriations 20,061,979 20,061,979 18,838,177 (1,223,802) Charges to Appropriation (Outflow):
Housing and community development 273,975 273,975 405,981 (132,006) Debt service:
Principal retirement 8,115,000 8,115,000 7,148,148 966,852 Interest and fiscal charges 6,638,052 6,638,052 5,914,848 723,204 Total Charges to Appropriations 15,027,027 15,027,027 13,468,977 1,558,050 Budgetary Fund Balance, June 30 $ 5,034,952 $ 5,034,952 $ 5,369,200 $ 334,248 118 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Net Position
Non-Major Enterprise Funds
June 30, 2023
Totals
Assets:
Current:
Cash and investments $ 2,168,566 $ 156,760 $ 2,325,326
Receivables:
Accounts 323,594 1,381 324,975
Taxes 99,634 - 99,634
Due from other governments - 1,478,449 1,478,449
Total Current Assets 2,591,794 1,636,590 4,228,384
Noncurrent:
Capital assets - net of accumulated depreciation 15,439 1,410,174 1,425,613 Total Noncurrent Assets 15,439 1,410,174 1,425,613
Total Assets 2,607,233 3,046,764 5,653,997
Deferred Outflows of Resources:
Deferred pension related items 470,433 378,790 849,223
Deferred OPEB related items 33,115 28,573 61,688
Total Deferred Outflows of Resources 503,548 407,363 910,911 Liabilities:
Current:
Accounts payable 446,748 673,103 1,119,851
Accrued interest 5,087 4,451 9,538
Uneared revenues 42,218 1,494 43,712
Due to other funds - 922,643 922,643
Accrued compensated absences 10,606 25,812 36,418
Long-term debt - due within one year 42,336 37,044 79,380 Total Current Liabilities 546,995 1,664,547 2,211,542
Noncurrent:
Accrued compensated absences 31,817 77,427 109,244
Accrued claims and judgments - - -
Long-term debt - due in more than one year 1,182,104 1,034,341 2,216,445 Net pension liability 198,429 159,774 358,203
Net OPEB liability 109,315 94,322 203,637
Total Noncurrent Liabilities 1,521,665 1,365,864 2,887,529 Total Liabilities 2,068,660 3,030,411 5,099,071
Deferred Inflows of Resources:
Deferred pension related items 60,249 48,512 108,761
Deferred OPEB related items 40,165 34,656 74,821
Total Deferred Inflows of Resources 100,414 83,168 183,582 Net Position:
Net investment in capital assets 15,439 1,410,174 1,425,613 Unrestricted 926,268 (1,069,626) (143,358)
Total Net Position $ 941,707 $ 340,548 1,282,255
Solid Waste
Business-Type Activities - Enterprise Funds
Transit
119 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Revenues, Expenses
and Changes in Fund Net Position
Non-Major Enterprise Funds
Year Ended June 30, 2023
Totals
Operating Revenues:
Sales and service charges $ 5,950,872 $ 165,152 $ 6,116,024 Miscellaneous 190,785 44 190,829
Total Operating Revenues 6,141,657 165,196 6,306,853
Operating Expenses:
Administration and general 33,032 707,410 740,442
Personnel services 566,040 1,019,649 1,585,689
Contractual services 4,663,220 3,601,444 8,264,664
Internal service charges 331,478 312,048 643,526
Depreciation expense 2,084 152,179 154,263
Total Operating Expenses 5,595,854 5,792,730 11,388,584 Operating Income (Loss) 545,803 (5,627,534) (5,081,731) Nonoperating Revenues (Expenses):
Intergovernmental 28,234 4,143,094 4,171,328
Interest expense (31,490) (27,206) (58,696)
Gain (loss) on disposal of capital assets - 1,241 1,241 Total Nonoperating
Revenues (Expenses) (3,256) 4,117,129 4,113,873
Income (Loss) Before Transfers 542,547 (1,510,405) (967,858) Transfers in 98 1,510,726 1,510,824
Transfers out (6) (411) (417)
Changes in Net Position 542,639 (90) 542,549
Net Position:
Beginning of Year 399,068 340,638 739,706
End of Fiscal Year $ 941,707 $ 340,548 $ 1,282,255
Solid Waste
Business-Type Activities - Enterprise Funds
Transit
120 DRAFT
CITY OF REDONDO BEACH
Statement of Cash Flows
Non-Major Enterprise Funds
Year Ended June 30, 2023
Totals
Cash Flows from Operating Activities:
Cash received from customers and users $ 5,980,543 $ 161,728 $ 6,142,271 Cash paid to suppliers for goods and services (4,631,167) (4,556,175) (9,187,342) Cash paid to employees for services (715,843) (707,753) (1,423,596) Net Cash Provided (Used) by Operating Activities 633,533 (5,102,200) (4,468,667) Cash Flows from Non-Capital
Financing Activities:
Cash transfers out (6) (411) (417)
Cash transfers in 98 1,510,726 1,510,824
Repayment received from other funds - 884,888 884,888
Principal paid on non-capital debt issued (42,168) (36,897) (79,065) Interest paid on non-capital debt (31,490) (27,206) (58,696) Grant subsidies 28,234 3,245,701 3,273,935
Net Cash Provided (Used) by
Non-Capital Financing Activities (45,332) 5,576,801 5,531,469 Cash Flows from Capital
and Related Financing Activities:
Acquisition and construction of capital assets - (319,393) (319,393) Proceeds from sales of capital assets - 1,240 1,240
Net Cash Provided (Used) by
Capital and Related Financing Activities - (318,153) (318,153) Net Increase (Decrease) in Cash
and Cash Equivalents 588,201 156,448 744,649
Cash and Cash Equivalents at Beginning of Year 1,580,365 312 1,580,677 Cash and Cash Equivalents at End of Year $ 2,168,566 $ 156,760 $ 2,325,326 Reconciliation of Operating Income to Net Cash
Provided (Used) by Operating Activities:
Operating income (loss) $ 545,803 $ (5,627,534) $ (5,081,731) Adjustments to reconcile operating income (loss)
net cash provided (used) by operating activities:
Depreciation 2,084 152,179 154,263
(Increase) decrease in accounts receivable (161,114) (1,381) (162,495) Increase (decrease) in accounts payable 379,307 48,709 428,016 Increase (decrease) in unearned revenue - (2,087) (2,087) Increase (decrease) in net pension liability (613,370) (240,341) (853,711) Increase (decrease) in OPEB liability 17,256 16,018 33,274 Increase (decrease) in deferred pension related items 488,062 566,803 1,054,865 Increase (decrease) in deferred OPEB related items (21,636) (18,318) (39,954) Increase (decrease) in compensated absences (2,859) 3,752 893 Total Adjustments 87,730 525,334 613,064
Net Cash Provided (Used) by
Operating Activities $ 633,533 $ (5,102,200) $ (4,468,667) Non-Cash Investing, Capital, and Financing Activities:
None
Business-Type Activities - Enterprise Funds
Solid Waste Transit
121 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Net Position
Internal Service Funds
June 30, 2023
Assets:
Current:
Cash and investments $ 10,683,224 $ 2,881,350 $ 2,089,732 Receivables:
Accounts 63,266 - -
Prepaid costs - - 11,910
Total Current Assets 10,746,490 2,881,350 2,101,642
Noncurrent:
Capital assets - net of accumulated depreciation 5,819,495 135,086 1,356,568 Total Noncurrent Assets 5,819,495 135,086 1,356,568
Total Assets 16,565,985 3,016,436 3,458,210
Deferred Outflows of Resources:
Deferred pension related items 349,633 764,291 736,861
Deferred OPEB related items 27,461 56,528 52,576
Total Deferred Outflows of Resources 377,094 820,819 789,437 Liabilities:
Current:
Accounts payable 227,941 230,534 114,412
Accrued interest 7,796 10,538 11,228
Accrued compensated absences 8,195 22,384 18,287
Accrued claims and judgments - - -
Long-term debt - due within one year 82,653 87,696 141,511 Total Current Liabilities 326,585 351,152 285,438
Noncurrent:
Accrued compensated absences 24,585 67,152 54,863
Accrued claims and judgments - - -
Long-term debt - due in more than one year 1,273,340 2,448,644 2,470,156 Net pension liability 147,476 322,379 310,808
Net OPEB liability 90,652 186,608 173,560
Total Noncurrent Liabilities 1,536,053 3,024,783 3,009,387 Total Liabilities 1,862,638 3,375,935 3,294,825
Deferred Inflows of Resources:
Deferred pension related items 44,778 97,883 94,370
Deferred OPEB related items 33,308 68,565 63,771
Total Deferred Inflows of Resources 78,086 166,448 158,141 Net Position:
Net investment in capital assets 5,582,887 135,086 1,259,376 Unrestricted 9,419,468 159,786 (464,695)
Total Net Position $ 15,002,355 $ 294,872 $ 794,681
Governmental Activities - Internal Service Funds
Vehicle
Replacement
Building
Occupancy
Information
Technology
122 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Net Position
Internal Service Funds
June 30, 2023
Assets:
Current:
Cash and investments
Receivables:
Accounts
Prepaid costs
Total Current Assets
Noncurrent:
Capital assets - net of accumulated depreciation
Total Noncurrent Assets
Total Assets
Deferred Outflows of Resources:
Deferred pension related items
Deferred OPEB related items
Total Deferred Outflows of Resources
Liabilities:
Current:
Accounts payable
Accrued interest
Accrued compensated absences
Accrued claims and judgments
Long-term debt - due within one year
Total Current Liabilities
Noncurrent:
Accrued compensated absences
Accrued claims and judgments
Long-term debt - due in more than one year
Net pension liability
Net OPEB liability
Total Noncurrent Liabilities
Total Liabilities
Deferred Inflows of Resources:
Deferred pension related items
Deferred OPEB related items
Total Deferred Inflows of Resources
Net Position:
Net investment in capital assets
Unrestricted
Total Net Position
Totals
$ 13,412,557 $ 5,737,377 $ 1,043,763 $ 35,848,003
- - - 63,266
- - - 11,910
13,412,557 5,737,377 1,043,763 35,923,179
146,731 1,162,893 637,625 9,258,398
146,731 1,162,893 637,625 9,258,398
13,559,288 6,900,270 1,681,388 45,181,577
108,415 510,830 - 2,470,030
5,741 59,240 - 201,546
114,156 570,070 - 2,671,576
2,828,275 94,261 184,544 3,679,967
727 14,535 - 44,824
- 26,841 - 75,707
748,564 - - 748,564
6,048 120,204 - 438,112
3,583,614 255,841 184,544 4,987,174
- 80,520 - 227,120
20,172,822 - - 20,172,822
168,872 3,378,196 - 9,739,208
45,729 305,964 - 1,132,356
18,950 195,559 - 665,329
20,406,373 3,960,239 - 31,936,835
23,989,987 4,216,080 184,544 36,924,009
13,885 23,549 - 274,465
6,963 71,854 - 244,461
20,848 95,403 - 518,926
146,731 1,162,893 453,081 8,740,054
(10,484,122) 1,995,964 1,043,763 1,670,164
$ (10,337,391) $ 3,158,857 $ 1,496,844 $ 10,410,218
Governmental Activities - Internal Service Funds
Major Facilities
Repair
Self-Insurance
Program
Emergency
Communications
123 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Revenues, Expenses
and Changes in Net Position
Internal Service Funds
Year Ended June 30, 2023
Operating Revenues:
Sales and service charges $ 3,977,986 $ 3,684,113 $ 3,695,264 Miscellaneous 224,301 - 10
Total Operating Revenues 4,202,287 3,684,113 3,695,274
Operating Expenses:
Administration and general 1,426,076 1,346,414 625,460
Personnel services 697,532 1,152,405 1,178,104
Contractual services 65,243 292,543 1,540,413
Internal service charges 347,398 421,424 696,966
Depreciation amd amortization expense 1,066,247 11,750 141,476 Total Operating Expenses 3,602,496 3,224,536 4,182,419
Operating Income (Loss) 599,791 459,577 (487,145)
Nonoperating Revenues (Expenses):
Interest expense (34,263) (65,164) (66,935)
Gain (loss) on disposal of capital assets 17,785 - -
Total Nonoperating
Revenues (Expenses) (16,478) (65,164) (66,935)
Income (Loss) Before Transfers 583,313 394,413 (554,080) Transfers in 133 135 902
Transfers out (6) (77) -
Changes in Net Position 583,440 394,471 (553,178)
Net Position:
Beginning of Year 14,418,915 (99,599) 1,347,859
End of Fiscal Year $ 15,002,355 $ 294,872 $ 794,681
Governmental Activities - Internal Service Funds
Vehicle
Replacement
Building
Occupancy
Information
Technology
124 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Revenues, Expenses
and Changes in Net Position
Internal Service Funds
Year Ended June 30, 2023
Operating Revenues:
Sales and service charges
Miscellaneous
Total Operating Revenues
Operating Expenses:
Administration and general
Personnel services
Contractual services
Internal service charges
Depreciation amd amortization expense
Total Operating Expenses
Operating Income (Loss)
Nonoperating Revenues (Expenses):
Interest expense
Gain (loss) on disposal of capital assets
Total Nonoperating
Revenues (Expenses)
Income (Loss) Before Transfers
Transfers in
Transfers out
Changes in Net Position
Net Position:
Beginning of Year
End of Fiscal Year
Totals
$ 8,602,706 $ 3,321,707 $ 110,546 $ 23,392,322
- - - 224,311
8,602,706 3,321,707 110,546 23,616,633
7,148,937 58,019 - 10,604,906
8,004 3,351,865 - 6,387,910
191,255 416,500 - 2,505,954
332,973 382,681 - 2,181,442
- 230,330 22,691 1,472,494
7,681,169 4,439,395 22,691 23,152,706
921,537 (1,117,688) 87,855 463,927
(4,622) (90,747) - (261,731)
- - - 17,785
(4,622) (90,747) - (243,946)
916,915 (1,208,435) 87,855 219,981
177 1,049 - 2,396
- (22,403) - (22,486)
917,092 (1,229,789) 87,855 199,891
(11,254,483) 4,388,646 1,408,989 10,210,327
$ (10,337,391) $ 3,158,857 $ 1,496,844 $ 10,410,218
Self-Insurance
Program
Emergency
Communications
Major Facilities
Repair
Governmental Activities - Internal Service Funds
125 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Cash Flows
Internal Service Funds
Year ended June 30, 2023
Cash Flows from Operating Activities:
Cash received from customers and users $ 4,190,551 $ 3,684,113 $ 3,695,274 Cash paid to suppliers for goods and services (1,737,617) (2,290,548) (2,873,772) Cash paid to employees for services (565,717) (1,165,259) (1,135,031) Net Cash Provided (Used) by Operating Activities 1,887,217 228,306 (313,529) Cash Flows from Non-Capital
Financing Activities:
Principal paid on non-capital debt (42,168) (87,348) (86,595) Interest paid on non-capital debt (31,256) (65,164) (64,266) Net Cash Provided (Used) by
Non-Capital Financing Activities (73,297) (152,454) (149,959) Cash Flows from Capital
and Related Financing Activities:
Acquisition and construction of capital assets (996,817) - (443,080) Principal paid on capital debt (40,200) - (49,362)
Interest paid on capital debt (298) - (1,888)
Proceeds from sale of capital assets 18,029 - -
Net Cash Provided (Used) by
Capital and Related Financing Activities (1,019,286) - (494,330) Net Increase (Decrease) in Cash
and Cash Equivalents 794,634 75,852 (957,818)
Cash and Cash Equivalents at Beginning of Year 9,888,590 2,805,498 3,047,550 Cash and Cash Equivalents at End of Year $ 10,683,224 $ 2,881,350 $ 2,089,732 Reconciliation of Operating Income to Net Cash
Provided (Used) by Operating Activities:
Operating income (loss) $ 599,791 $ 459,577 $ (487,145) Adjustments to reconcile operating income (loss)
net cash provided (used) by operating activities:
Depreciation and amortization 1,066,247 11,750 141,476
(Increase) decrease in accounts receivable (11,736) - - (Increase) decrease in deferred outflow pension related items 917,068 1,887,026 1,875,737 (Increase) decrease in deferred outflow OPEB related items (2,002) (3,117) 2,369 (Increase) decrease in prepaid expense - - (4,915)
Increase (decrease) in accounts payable 87,018 (256,141) (14,329) Increase (decrease) in claims and judgments - - -
Increase (decrease) in net pension liability (506,351) (1,262,922) (1,127,292) Increase (decrease) in net OPEB liability 14,082 25,974 8,311 Increase (decrease) in deferred inflow pension related items (267,093) (658,294) (591,594) Increase (decrease) in deferred inflow OPEB related items (16,012) (34,902) (42,668) Increase (decrease) in compensated absences 6,205 59,355 (73,479) Total Adjustments 1,287,426 (231,271) 173,616
Net Cash Provided (Used) by
Operating Activities $ 1,887,217 $ 228,306 $ (313,529)
Non-Cash Investing, Capital, and Financing Activities:
Subscription financing (171,753) - (146,554)
Subscription assets acquired 171,753 - 146,554
Governmental Activities - Internal Service Funds
Vehicle
Replacement
Building
Occupancy
Information
Technology
126 DRAFT
CITY OF REDONDO BEACH
Combining Statement of Cash Flows
Internal Service Funds
Year ended June 30, 2023
Cash Flows from Operating Activities:
Cash received from customers and users
Cash paid to suppliers for goods and services
Cash paid to employees for services
Net Cash Provided (Used) by Operating Activities
Cash Flows from Non-Capital
Financing Activities:
Principal paid on non-capital debt
Interest paid on non-capital debt
Net Cash Provided (Used) by
Non-Capital Financing Activities
Cash Flows from Capital
and Related Financing Activities:
Acquisition and construction of capital assets
Principal paid on capital debt
Interest paid on capital debt
Proceeds from sale of capital assets
Net Cash Provided (Used) by
Capital and Related Financing Activities
Net Increase (Decrease) in Cash
and Cash Equivalents
Cash and Cash Equivalents at Beginning of Year
Cash and Cash Equivalents at End of Year
Reconciliation of Operating Income to Net Cash
Provided (Used) by Operating Activities:
Operating income (loss)
Adjustments to reconcile operating income (loss)
net cash provided (used) by operating activities:
Depreciation and amortization
(Increase) decrease in accounts receivable
(Increase) decrease in deferred outflow pension related items (Increase) decrease in deferred outflow OPEB related items (Increase) decrease in prepaid expense
Increase (decrease) in accounts payable
Increase (decrease) in claims and judgments
Increase (decrease) in net pension liability
Increase (decrease) in net OPEB liability
Increase (decrease) in deferred inflow pension related items Increase (decrease) in deferred inflow OPEB related items Increase (decrease) in compensated absences
Total Adjustments
Net Cash Provided (Used) by
Operating Activities
Non-Cash Investing, Capital, and Financing Activities:
Subscription financing
Subscription assets acquired
Totals
$ 8,602,706 $ 3,321,708 $ 110,545 $ 23,604,897
(9,126,400) (780,821) 180,362 (16,628,796)
(324,410) (1,872,570) - (5,062,987)
(848,104) 668,317 290,907 1,913,114
(6,024) (120,480) - (342,615)
(4,622) (90,747) - (256,055)
(10,469) (232,581) - (618,760)
(101,370) - (229,972) (1,771,239)
- - - (89,562)
- - - (2,186)
- - - 18,029
(101,370) - (229,972) (1,844,958)
(959,943) 435,736 60,935 (550,604)
14,372,500 5,301,641 982,828 36,398,607
$ 13,412,557 $ 5,737,377 $ 1,043,763 $ 35,848,003
$ 921,537 $ (1,117,688) $ 87,855 $ 463,927
- 230,331 22,691 1,472,495
- - - (11,736)
82,630 3,017,995 - 7,780,456
(1,741) 833 - (3,658)
- - - (4,915)
1,665,384 61,490 180,361 1,723,783
(3,316,793) - - (3,316,793)
(132,587) (1,132,710) - (4,161,862)
6,919 14,889 - 70,175
(71,170) (379,251) - (1,967,402)
(787) (44,518) - (138,887)
(1,496) 16,946 - 7,531
(1,769,641) 1,786,005 203,052 1,449,187
$ (848,104) $ 668,317 $ 290,907 $ 1,913,114
- - - (318,307)
- - - 318,307
Governmental Activities - Internal Service Funds
Self-Insurance
Program
Emergency
Communications
Major Facilities
Repair
127 DRAFT
City of Redondo Beach
Net Position by Component
Last Ten Fiscal Years
(accrual basis of accounting)
2014 2015 * 2016 2017 2018
Governmental Activities:
Net investment in capital assets $ 138,614,141 $ 139,555,634 $ 135,628,091 $ 139,053,697 $ 147,515,377 Restricted 19,059,951 16,503,649 26,346,341 22,833,987 24,348,682 Unrestricted 28,918,308 (85,699,247) (81,186,849) (83,567,317) (118,477,214) Total governmental activities net position 186,592,400 70,360,036 80,787,583 78,320,367 53,386,845
Business-type activities:
Net investment in capital assets 36,646,484 37,629,261 37,542,589 37,169,598 43,285,102 Restricted - - - - -
Unrestricted 27,250,666 18,257,918 24,136,647 28,549,056 24,562,294 Total business-type activities net position 63,897,150 55,887,179 61,679,236 65,718,654 67,847,396 Primary government:
Net investment in capital assets 175,260,625 177,184,895 173,170,680 176,223,295 190,800,479 Restricted 19,059,951 16,503,649 26,346,341 22,833,987 24,348,682 Unrestricted 56,168,974 (67,441,329) (57,050,202) (55,018,261) (93,914,920) Total primary government net position $ 250,489,550 $ 126,247,215 $ 142,466,819 $ 144,039,021 $ 121,234,241 NOTE: * In FY 2014-2015, GASB Statement 68 was implemented and contributed to the decrease in net position.
Source: City of Redondo Beach Comprehensive Annual Financial Report, Government-Wide Financial Statements Fiscal Year
128 DRAFT
City of Redondo Beach
Net Position by Component
Last Ten Fiscal Years
(accrual basis of accounting)
2019 2020 2021 2022 2023
Governmental Activities:
Net investment in capital assets $ 149,571,518 $ 155,670,310 $ 164,993,054 $ 146,082,092 $ 189,024,081 Restricted 36,179,269 29,323,216 27,392,685 31,365,112 29,038,880 Unrestricted (150,061,607) (169,266,411) (175,501,877) (134,974,819) (163,871,388) Total governmental activities net position 35,689,180 15,727,115 16,883,862 42,472,385 54,191,573
Business-type activities:
Net investment in capital assets 44,986,964 58,077,077 59,334,911 60,441,156 66,054,613 Restricted - - - - -
Unrestricted 23,360,854 18,858,253 16,913,909 18,369,052 16,395,109 Total business-type activities net position 68,347,818 76,935,330 76,248,820 78,810,208 82,449,722 Primary government:
Net investment in capital assets 194,558,482 213,747,387 224,327,965 206,523,248 255,078,694 Restricted 36,179,269 29,323,216 27,392,685 31,365,112 29,038,880 Unrestricted (126,700,753) (150,408,158) (158,587,968) (116,605,767) (147,476,279) Total primary government net position $ 104,036,998 $ 92,662,445 $ 93,132,682 $ 121,282,593 $ 136,641,295 (CONTINUED)
Fiscal Year
129 DRAFT
City of Redondo Beach
Changes in Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
2014 2015 2016 2017 2018
Expenses
Government activities:
General government $ 10,177,409 $ 10,293,394 $ 10,946,935 $ 10,846,646 $ 14,142,348 Public Safety 44,022,014 47,331,250 46,362,851 55,489,827 60,845,022 Housing and community development 10,115,114 9,229,689 8,936,256 9,769,288 11,797,299 Cultural and leisure services 10,042,640 10,990,481 11,556,891 12,496,716 14,539,255 Public works 11,817,281 15,500,144 12,616,719 14,135,326 16,496,964 Interest on long-term debt 194,200 152,348 124,522 80,782 51,658 Total governmental activities expenses 86,368,658 93,497,306 90,544,174 102,818,585 117,872,546 Business-type activities:
Harbor Tidelands 5,040,308 5,279,836 5,652,988 6,395,134 7,035,921 Harbor Uplands 4,051,432 4,230,371 4,469,890 4,479,269 3,224,093 Wastewater 2,557,592 2,022,271 2,144,353 2,917,527 3,667,593 Solid Waste 3,580,040 3,506,271 3,763,513 3,973,666 3,968,186 Transit 3,346,989 3,366,535 3,536,593 3,626,075 3,844,008 Total business-type activities expenses 18,576,361 18,405,284 19,567,337 21,391,671 21,739,801 Total primary government expenses 104,945,019 111,902,590 110,111,511 124,210,256 139,612,347 Component Units:
Program Revenues
Governmental activities:
Charges for Services:
General government 7,539,299 9,083,395 8,689,834 8,570,506 8,305,869 Public Safety 4,942,725 4,611,279 4,503,948 4,764,211 5,310,033 Housing and community development 2,858,612 2,681,729 2,160,284 3,577,756 3,458,586 Cultural and leisure services 5,942,540 6,733,424 6,606,802 5,837,816 6,709,262 Public works 2,386,890 2,154,679 2,334,537 2,579,475 2,459,268 Operating grants and contributions 8,052,877 8,170,736 8,135,187 8,563,072 8,090,195 Capital grants and contributions 294,342 2,310,026 912,045 492,146 1,872,910 Total governmental activities program revenues 32,017,285 35,745,268 33,342,637 34,384,982 36,206,123 Fiscal Year
130 DRAFT
City of Redondo Beach
Changes in Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
2014 2015 2016 2017 2018
Fiscal Year
Business-type activities:
Charges for services:
Harbor Tidelands $ 5,870,760 $ 6,526,625 $ 6,483,927 $ 6,694,914 $ 6,565,619 Harbor Uplands 4,311,358 4,585,998 5,314,448 5,378,886 5,267,564 Wastewater 4,568,330 5,433,185 5,618,086 5,546,090 5,575,855 Solid Waste 3,369,217 3,569,336 3,832,166 3,792,964 3,836,976 Transit 352,756 360,519 366,314 344,071 336,962
Operating grants and contributions 1,754,397 1,848,671 2,200,958 1,888,902 2,247,490 Capital grants and contributions - - - - -
Total business-type activities program revenues 20,226,818 22,324,334 23,815,899 23,645,827 23,830,466 Total primary government program revenues 52,244,103 58,069,602 57,158,536 58,030,809 60,036,589 Net (expense)/revenue
Governmental activities (54,351,373) (57,752,038) (57,201,537) (68,433,603) (81,666,423) Business-type activities 1,650,457 3,919,050 4,248,562 2,254,156 2,090,665 Total primary government net expense (52,700,916) (53,832,988) (52,952,975) (66,179,447) (79,575,758) General Revenues and Other Changes in Net Position
Governmental Activities
Taxes
Property taxes, levied for general purpose 30,175,663 31,424,789 32,766,493 34,375,818 36,847,562 Transient occupancy taxes 3,970,786 4,464,811 8,627,801 7,689,889 9,172,934 Sales taxes 10,450,402 11,889,190 12,347,884 10,059,087 10,185,208 Franchise taxes 1,973,182 1,981,936 1,963,752 1,706,371 1,896,809 Business licenses taxes 1,296,531 1,178,016 1,186,567 1,201,068 1,322,333 Utility users taxes 7,412,250 7,664,385 7,411,930 7,085,063 6,928,129 Other taxes 1,840 5,149 - 731,571 632,084
Motor vehicle in lieu 28,894 27,910 27,475 31,132 36,272 Investment earnings 1,251,129 1,069,970 1,184,588 3,038,633 3,134,966 Other revenues 1,885,242 2,271,960 2,826,066 1,521,902 1,407,243 Gain (loss) on sale of capital assets 12,657 27,676 71,254 - - Special item - - - - -
Transfers (1,350,534) (1,462,139) (784,726) (1,474,147) (1,106,621) Gain (loss) on dissolution of Redevelopment Agency - - - - - Total governmental activities 57,108,042 60,543,653 67,629,084 65,966,387 70,456,919 Business-type activities:
Investment earnings 331,919 237,235 450,632 99,085 237,280 Gain (loss) on sale of capital assets (79,277) - 11,868 5,606 - Other revenues 400,396 375,982 296,269 206,424 282,370
Special item - - - - -
Transfers 1,350,534 1,462,139 784,726 1,474,147 1,106,621 Total business-type activities 2,003,572 2,075,356 1,543,495 1,785,262 1,626,271 Total primary government 59,111,614 62,619,009 69,172,579 67,751,649 72,083,190 Change in Net Position
Governmental activities 2,756,669 2,791,615 10,427,547 (2,467,216) (11,209,504) Business-type activities 3,654,029 5,994,406 5,792,057 4,039,418 3,716,936 Totally primary government $ 6,410,698 $ 8,786,021 $ 16,219,604 $ 1,572,202 $ (7,492,568) Information prior to the implementation of GASB 34 is not available.
Source: City of Redondo Beach Comprehensive Annual Financial Report, Government-Wide Financial Statements 131 DRAFT
City of Redondo Beach
Changes in Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
Expenses
Government activities:
General government
Public Safety
Housing and community development
Cultural and leisure services
Public works
Interest on long-term debt
Total governmental activities expenses
Business-type activities:
Harbor Tidelands
Harbor Uplands
Wastewater
Solid Waste
Transit
Total business-type activities expenses
Total primary government expenses
Component Units:
Program Revenues
Governmental activities:
Charges for Services:
General government
Public Safety
Housing and community development
Cultural and leisure services
Public works
Operating grants and contributions
Capital grants and contributions
Total governmental activities program revenues
2019 2020 2021 2022 2023
$ 12,380,308 $ 13,574,385 $ 11,692,177 $ 10,676,673 $ 8,875,247 62,740,166 71,807,026 68,527,338 50,336,195 77,329,726
11,460,619 11,456,603 11,119,995 12,241,640 10,119,877
12,296,505 11,810,514 10,033,842 11,259,954 11,227,624
14,655,265 15,373,701 14,439,178 17,327,400 11,459,350
641,587 1,272,259 1,117,677 7,161,637 6,046,346
114,174,450 125,294,488 116,930,207 109,003,499 125,058,170 9,433,807 9,067,251 4,636,895 7,593,555 6,414,101
5,016,104 4,707,797 5,898,608 5,671,184 3,877,153
3,406,302 3,809,885 3,319,536 2,766,293 4,852,027
4,690,425 4,894,581 5,115,305 5,270,585 5,627,344
4,004,654 3,975,884 4,440,739 4,437,245 5,819,936
26,551,292 26,455,398 23,411,083 25,738,862 26,590,561
140,725,742 151,749,886 140,341,290 134,742,361 151,648,731 9,769,717 10,699,014 10,760,125 17,442,962 11,449,964
5,766,102 4,922,828 6,414,431 6,389,408 5,214,506
3,491,863 3,189,541 3,274,369 3,426,571 5,923,067
7,283,873 6,609,840 6,182,448 7,840,440 10,742,331
2,737,458 2,297,396 3,447,892 2,420,262 2,953,076
10,151,972 10,326,680 14,547,505 14,317,249 16,501,962
485,693 2,882,105 2,285,961 7,786,097 3,088,905
39,686,678 40,927,404 46,912,731 59,622,989 55,873,811
(CONTINUED)
Fiscal Year
132 DRAFT
City of Redondo Beach
Changes in Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
Business-type activities:
Charges for services:
Harbor Tidelands
Harbor Uplands
Wastewater
Solid Waste
Transit
Operating grants and contributions
Capital grants and contributions
Total business-type activities program revenues
Total primary government program revenues
Net (expense)/revenue
Governmental activities
Business-type activities
Total primary government net expense
General Revenues and Other Changes in Net Position
Governmental Activities
Taxes
Property taxes, levied for general purpose
Transient occupancy taxes
Sales taxes
Franchise taxes
Business licenses taxes
Utility users taxes
Other taxes
Motor vehicle in lieu
Investment earnings
Other revenues
Gain (loss) on sale of capital assets
Special item
Transfers
Gain (loss) on dissolution of Redevelopment Agency
Total governmental activities
Business-type activities:
Investment earnings
Gain (loss) on sale of capital assets
Other revenues
Special item
Transfers
Total business-type activities
Total primary government
Change in Net Position
Governmental activities
Business-type activities
Totally primary government
Information prior to the implementation of GASB 34 is not available.
Source: City of Redondo Beach Comprehensive Annual Financial Report, Government-Wide Financial Statements 2019 2020 2021 2022 2023
(CONTINUED)
Fiscal Year
$ 6,714,763 $ 5,729,264 $ 4,816,599 $ 7,611,643 $ 7,624,821 6,129,658 4,886,188 4,945,241 6,239,484 5,754,907
5,419,215 5,523,009 5,487,873 5,417,916 5,433,482
3,965,662 4,330,439 4,780,684 5,549,427 6,141,657
338,835 250,758 - 280 165,196
2,362,021 2,958,743 2,853,567 4,291,625 4,191,328
- - - - -
24,930,154 23,678,401 22,883,964 29,110,375 29,311,391
64,616,832 64,605,805 69,796,695 88,733,364 85,185,202
(74,487,772) (84,367,084) (70,017,476) (49,380,510) (69,184,359) (1,621,138) (2,776,997) (527,119) 3,371,513 2,720,830
(76,108,910) (87,144,081) (70,544,595) (46,008,997) (66,463,529) 38,249,535 39,774,170 43,705,194 44,424,757 45,649,338
8,816,739 6,335,445 3,400,322 5,419,197 6,174,326
10,578,527 9,716,883 10,018,217 11,813,896 11,036,523
1,647,287 1,706,355 1,731,846 1,864,336 2,131,206
1,295,050 1,251,673 1,211,539 1,193,814 1,301,224
6,757,622 6,824,873 6,713,480 8,024,511 9,166,031
917,102 969,721 1,019,041 1,133,754 1,173,417
32,965 54,193 49,136 77,111 72,000
5,483,218 5,219,501 1,408,878 69,136 3,558,292
2,314,681 1,640,662 1,642,581 714,946 470,103
19,352 - - - 17,785
(18,823,249) (1,595,860) - - -
(498,722) (7,492,597) 273,989 233,575 138,511
- - - - -
56,790,107 64,405,019 71,174,223 74,969,033 80,888,756
1,442,556 1,563,880 (72,233) (576,550) 1,055,954
244 - - - 1,241
180,038 712,172 186,831 - -
- 1,595,860 - - -
498,722 7,492,597 (273,989) (233,575) (138,511)
2,121,560 11,364,509 (159,391) (810,125) 918,684
58,911,667 75,769,528 71,014,832 74,158,908 81,807,440
(17,697,665) (19,962,065) 1,156,747 25,588,523 11,704,397 500,422 8,587,512 (686,510) 2,561,388 3,639,514
$ (17,197,243) $ (11,374,553) $ 470,237 $ 28,149,911 $ 15,343,911 133 DRAFT
City of Redondo Beach
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
2014 2015 2016 2017 2018
General fund
Nonspendable $ 82,255 $ 90,836 $ 87,345 $ 1,013,152 $ 93,705 Restricted - - 3,000,000 - -
Committed 6,188,191 6,738,848 7,154,237 7,409,689 7,605,573 Assigned 12,025,746 10,500,675 9,303,536 9,134,516 9,431,007 Unassigned 2,674,597 5,786,193 1,694,671 945,992 653,649 Total general fund 20,970,789 23,116,552 21,239,789 18,503,349 17,783,934
All other governmental funds
Nonspendable 2,952,500 2,749,394 - - -
Nonspendable, reported in:
Special revenue funds - - - - -
Restricted 13,408,799 12,107,627 22,309,801 18,625,842 20,061,786 Restricted, reported in:
Special revenue funds - - - 4,208,145 4,286,896
Debt service funds 6,450,252 6,310,008 - - -
Committed - - - - -
Assigned 6,956,943 6,466,871 2,150,834 2,152,347 2,152,347 Assigned, reported in:
Capital projects funds - - 11,112,946 12,372,901 10,057,599 Special revenue funds - - - - -
Unassigned (99,891) (64,425) (106,954) (66,919) (5,146) Unassigned, reported in:
Special revenue funds (1,551,713) (1,852,352) (1,335,382) (1,453,532) (3,031,772) Capital projects funds - - - - -
Debt service funds - - - - -
Total all other governmental funds $ 28,116,890 $ 25,717,123 $ 34,131,245 $ 35,838,784 $ 33,521,710 Source: City of Redondo Beach Comprehensive Annual Financial Report, Governmental Fund Financial Statements
Fiscal Year
134 DRAFT
City of Redondo Beach
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting) (CONTINUED)
2019 2020 2021 2022 2023
General fund
Nonspendable $ 980,737 $ 107,697 $ 89,771 $ 71,426 $ 169,999 Restricted - - -
Committed 7,989,184 7,585,231 7,241,252 8,599,208 8,599,208 Assigned 10,999,817 9,149,145 8,908,619 20,421,828 24,228,260 Unassigned 753,238 704,067 2,039,523 271,557 190,951
Total general fund 20,722,976 17,546,140 18,279,165 29,364,019 33,188,418
All other governmental funds
Nonspendable - - - - -
Nonspendable, reported in:
Special revenue funds - - - - -
Restricted 17,751,026 25,180,005 23,255,534 22,498,317 25,541,166 Restricted, reported in:
Special revenue funds 4,296,752 4,143,211 4,137,151 3,841,655 3,497,714 Debt service funds 14,131,491 - - 5,025,140 -
Committed - - - - -
Assigned 2,352,347 9,708,041 8,013,238 15,208,719 12,960,508 Assigned, reported in:
Capital projects funds 9,158,315 - - - -
Special revenue funds - - - - -
Unassigned (403) (878,585) (310,276) (69,761) (27,960)
Unassigned, reported in:
Special revenue funds (2,974,945) (2,679,430) (4,008,147) (6,858,755) (6,053,354) Capital projects funds - - - - -
Debt service funds - - - - -
Total all other governmental funds $ 44,714,583 $ 35,473,242 $ 31,087,500 $ 39,645,315 $ 35,918,074
Fiscal Year
135 DRAFT
City of Redondo Beach
Last Ten Fiscal Years
(modified accrual basis of accounting)
2014 2015 2016 2017 2018
Revenues:
Taxes $ 55,958,439 $ 58,603,127 $ 64,304,427 $ 62,848,867 $ 67,323,695 Interdepartmental 7,143,371 7,588,928 8,176,790 8,292,178 8,170,297 Licenses and permits 1,504,502 1,333,512 1,701,786 1,755,119 1,801,502 Intergovernmental 11,096,634 14,091,278 12,259,088 12,359,047 12,574,428 Charges for services 8,401,697 8,511,455 9,618,003 9,128,589 9,732,500 Use of money and property 2,499,563 2,795,350 3,113,269 3,038,633 3,134,966 Fines and forfeitures 1,836,166 1,960,083 1,645,777 1,523,928 1,368,615 Other revenues 1,816,196 2,147,500 2,678,261 2,540,369 2,498,976 Total Revenues 90,256,568 97,031,233 103,497,401 101,486,730 106,604,979 Expenditures:
Current:
General government 9,157,309 9,757,869 10,189,258 10,535,983 9,920,879 Public safety 43,653,885 48,274,212 50,019,597 52,875,881 57,451,797 Housing and community development 9,116,267 8,883,086 9,546,763 9,759,833 10,156,777 Cultural and leisure services 8,789,002 10,023,420 11,001,375 11,265,379 11,598,804 Public works 9,362,140 10,325,935 11,198,389 11,235,682 11,016,488 Capital outlay 1,248,965 7,382,451 3,235,047 4,682,977 7,442,754 Debt service:
Principal 665,000 695,000 715,000 745,000 775,000
Interest 240,736 187,296 152,896 121,999 89,856
Debt issuance costs - - - - -
Total Expenditures 82,233,304 95,529,269 96,058,325 101,222,734 108,452,355 Excess of Revenues Over (Under) Expenditures 8,023,264 1,501,964 7,439,076 263,996 (1,847,376) Other Financing Sources (Uses):
Transfers in 2,768,840 1,394,604 8,464,353 4,031,647 2,326,416 Transfers out (4,160,973) (3,150,572) (9,366,070) (5,324,544) (3,372,317) Leases - - - - -
Refunding bonds issued - - - - -
Other debts issued - - - - -
Bond premium - - - - -
Refunding bonds redeemed - - - - -
Gain (loss) on Redevelopment Agency dissolution - - - - - Total Other Financing Sources (Uses) (1,392,133) (1,755,968) (901,717) (1,292,897) (1,045,901) Special item - - - - -
Net Change in Fund Balances $ 6,631,131 $ (254,004) $ 6,537,359 $ (1,028,901) $ (2,893,277) Debt service as a percentage of noncapital expenditures 1.13% 1.01% 0.94% 0.91% 0.86% Changes in Fund Balances of Governmental Funds
Fiscal Year
Source: City of Redondo Beach Comprehensive Annual Financial Report, Government-Wide Financial Statements
136 DRAFT
City of Redondo Beach
Last Ten Fiscal Years
(modified accrual basis of accounting)
2019 2020 2021 2022 2023
Revenues:
Taxes $ 68,325,779 $ 66,579,120 $ 67,799,639 $ 73,874,265 $ 76,632,065 Interdepartmental 8,503,283 9,417,289 9,379,851 10,034,053 8,745,517 Licenses and permits 1,555,407 1,503,909 1,641,684 1,731,398 2,607,527 Intergovernmental 15,303,534 18,215,129 19,252,605 29,628,555 26,443,713 Charges for services 10,211,917 8,851,688 8,482,823 10,895,140 11,805,303 Use of money and property 5,483,218 5,219,501 1,408,878 69,136 3,558,292 Fines and forfeitures 1,489,424 1,163,678 1,331,574 1,247,572 1,347,895 Other revenues 5,049,393 3,835,968 6,194,701 3,727,529 6,049,378 Total Revenues 115,921,955 114,786,282 115,491,755 131,207,648 137,189,690 Expenditures:
Current:
General government 11,546,126 12,701,080 11,365,610 24,894,820 11,874,752 Public safety 58,235,693 61,281,401 60,812,252 209,643,074 56,313,610 Housing and community development 11,185,303 11,075,922 10,936,532 16,644,042 11,686,810 Cultural and leisure services 11,997,745 10,466,375 9,364,095 15,492,140 11,603,710 Public works 11,004,195 11,543,612 11,522,810 23,081,641 12,372,547 Capital outlay 5,142,247 19,525,792 13,563,804 14,567,037 20,838,116 Debt service: - - -
Principal 805,000 795,000 555,000 812,926 7,619,104
Interest 412,427 1,322,680 1,095,981 6,046,920 5,937,747 Debt issuance costs - - - - -
Total Expenditures 110,328,736 128,711,862 119,216,084 311,182,600 138,246,396 Excess of Revenues Over (Under) Expenditures 5,593,219 (13,925,580) (3,724,329) (179,974,952) (1,056,706) Other Financing Sources (Uses):
Transfers in 3,701,950 4,918,105 10,407,106 10,782,356 16,012,542 Transfers out (3,607,949) (3,410,702) (10,335,494) (10,548,781) (15,853,941) Leases - - - 2,245,558 980,472
Refunding bonds issued - - - - -
Other debts issued 28,015,000 - - 197,138,488 -
Bond premium (747,056) - - - -
Refunding bonds redeemed - - - - -
Gain (loss) on Redevelopment Agency dissolution - - - - - Total Other Financing Sources (Uses) 27,361,945 1,507,403 71,612 199,617,621 1,139,073 Special item (18,823,249) - - - -
Net Change in Fund Balances $ 14,131,915 $ (12,418,177) $ (3,652,717) $ 19,642,669 $ 82,367 Debt service as a percentage of noncapital expenditures 1.17% 1.98% 1.59% 2.37% 13.05%
Changes in Fund Balances of Governmental Funds
(CONTINUED)
Fiscal Year
137 DRAFT
City of Redondo Beach
Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years
Fiscal Year Taxable
Ended Less: Assessed
June 30 Secured Unsecured Exemptions Value
2014 $ 12,119,561,792 $ 479,888,191 $ (86,536,840) $ 12,512,913,143 2015 12,740,467,541 424,217,169 (73,103,981) 13,091,580,729 2016 13,389,390,286 445,897,750 (74,129,707) 13,761,158,329 2017 14,185,826,554 422,121,124 (72,679,071) 14,535,268,607 2018 14,985,005,088 475,749,665 (72,464,646) 15,388,290,107 2019 15,796,994,740 475,845,459 (72,083,515) 16,200,756,684 2020 16,570,567,490 495,949,088 (43,871,304) 17,022,645,274 2021 17,457,397,477 537,895,062 (55,071,992) 17,940,220,547 2022 18,203,914,759 581,594,262 (79,188,547) 18,706,320,474 2023 19,357,977,502 637,683,663 (101,991,595) 19,893,669,570 Source: HdL Coren & Cone, Los Angeles County Auditor-Controller/Tax Division 2022/2023 Combined Tax Rolls In 1978 the voters of the State of California passed Proposition 13 which limited property taxes to a total maximum rate of 1% based upon the assessed value of the property being taxed. Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only re-assessed at the time that it is sold to a new owner. At that point, the new assessed value is reassessed at the purchase price of the property sold. The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property and is subject to the limitations described above.
City
138 DRAFT
City of Redondo Beach
Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years
Fiscal Year Taxable Total
Ended Assessed Direct Tax
June 30 Secured Unsecured Exemptions Value Rate
2014 $ 453,832,698 $ 38,326,859 $ (352,000) $ 491,807,557 0.15783 2015 470,317,505 55,967,662 (221,000) 526,064,167 0.15797 2016 481,010,582 48,097,617 - 529,108,199 0.15808
2017 492,828,395 26,806,104 - 519,634,499 0.15834
2018 502,042,344 27,984,358 - 530,026,702 0.15871
2019 522,861,449 26,288,663 - 549,150,112 0.15883
2020 533,318,662 25,264,657 - 558,583,319 0.16317
2021 683,183,671 22,737,911 - 705,921,582 0.16331
2022 537,056,295 19,303,263 - 556,359,558 0.16340
2023 599,090,312 19,730,213 - 618,820,525 0.16353
(CONTINUED)
Redevelopment
139 DRAFT
City of Redondo Beach
Direct and Overlapping Property Tax Rates
(Rate per $100 of taxable value)
Last Ten Fiscal Years
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
City basic rate 0.16539 0.16539 0.16539 0.16539 0.16539 0.16539 0.16539 0.16539 0.16539 0.16539 Overlapping Rates:
Los Angeles County Detention
Facilities 1987 Debt 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000
Flood Control 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 Metropolitan Water District 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 Community College 0.01750 0.01742 0.01745 0.02294 0.02120 0.02223 0.02155 0.02362 0.02264 0.02299 Unified School District 0.09242 0.09689 0.09174 0.09079 0.08630 0.08086 0.08428 0.08430 0.07201 0.07711
Total Direct Rate 0.15783 0.15797 0.15808 0.15834 0.15871 0.15883 0.16317 0.16331 0.16340 0.16353 Total Direct Rate is the weighted average of all individual direct rates applied by the City of Redondo Beach.
RDA direct and overlapping rates are applied only to the incremental property values.
Source: HdL Coren & Cone, Los Angeles County Assessor 2022/2023 Tax Rate Table Notes: General fund tax rates are representative and based upon the direct and overlapping rates for the largest general fund tax rate area (TRA) by net taxable value.
RDA rate is based on the largest RDA tax rate area(TRA) and includes only rate(s) from indebtedness adopted prior to 1969 per California State statute.
In 1978, California voters passed Proposition 13 which set the property tax rate at a 1.00% fixed amount. This 1.00% is shared by all taxing agencies for which the subject property resides within. In addition to the 1.00% fixed amount, property owners are charged taxes as a percentage to assessed property values for the payment of any voter approved bonds.
Fiscal Year
140 DRAFT
City of Redondo Beach
Principal Property Taxpayers
Current Year and Nine Years Ago
Percent of Percent of
Total City Total City
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxpayer Value Value Value Value
Northrop Grumman Systems Corporation $ 610,145,755 2.97% $ 511,257,190 3.93% South Bay Center SPE LLC * 269,342,550 1.31% 197,906,507 1.52% Rexford Industrial 2410 Santa Fe LLC 99,639,264 0.49% - 0.00% The Kobe Group Inc 81,897,237 0.40% 75,794,844 0.58%
Noble House Recp Hotel Venture LLC 75,593,468 0.37% 63,330,777 0.49% AES Redondo Beach LLC 72,214,092 0.35% 159,452,370 1.23% Ray Pellegrino Trust * 71,333,399 0.35% - 0.00%
9300 Willshire LLC ET AL * 68,051,442 0.33% - 0.00%
Redondo Beach Distribution Center LLC 57,672,330 0.28% - 0.00% HPT IHG 2 Properties Trust * 53,083,872 0.26% 44,531,038 0.34% LPF Redondo Beach Inc * - - 45,669,852 0.35%
MKEG P LLC - - 38,486,407 0.30%
Lightning PropCo I LLC - - 35,196,909 0.27%
Target Corporation - - 33,923,544 0.26%
$ 1,458,973,409 7.11% $ 1,205,549,438 9.27%
NOTE: The amounts shown above include assessed value date for both the City and the Successor Agency (former Redevelopment Agency). * (Pending appeals on parcels)
Source: HdL Coren & Cone, Los Angeles County Assessor 2022/2023 Combined Tax Rolls 2023 2014
141 DRAFT
City of Redondo Beach
Property Tax Levies and Collections
Fiscal Year Total Tax Collections
Ended Levy for Percentage of in Subsequent Percentage
June 30 Fiscal Year Amount Levy Years Amount of Levy
2014 $ 29,413,514 $ 28,953,089 98.43% $ 487,130 $ 29,440,219 100.09% 2015 31,503,828 31,035,789 98.51% 451,369 31,487,158 99.95% 2016 32,883,797 32,440,070 98.65% 405,762 32,845,833 99.88% 2017 34,125,966 33,690,049 98.72% 388,499 34,078,548 99.86% 2018 35,718,202 35,230,091 98.63% 383,301 35,613,392 99.71% 2019 37,267,914 36,719,102 98.53% 364,627 37,083,729 99.51% 2020 39,182,819 38,271,140 97.67% 404,113 38,675,253 98.70% 2021 40,917,175 40,165,051 98.16% 602,163 40,767,215 99.63% 2022 42,386,631 41,678,608 98.33% 594,526 42,273,134 99.73% 2023 45,094,012 44,393,742 98.45% 574,364 44,968,106 99.72% Source: County of Los Angeles Auditor-Controller
Last Ten Fiscal Years
Total Collections to Date
Collected within the
Fiscal Year of the Levy
142 DRAFT
City of Redondo Beach
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
Refunding Wastewater Total Percentage
Fiscal Revenue Capital Revenue Revenue Construction Capital Primary of Personal Per Year Bonds Loans Leases Subscriptions Bonds Bonds Loans Leases Government Income Capita 2014 $ 4,271,142 -$ $ 444,896 $ - $ 7,755,117 -$ $ 2,355,354 -$ $ 14,826,509 0.41% 219 2015 3,553,356 - 750,436 - 7,503,861 - 2,045,512 114,597 13,967,762 0.39% 205 2016 2,815,570 - 565,029 - 7,232,606 - 1,721,727 58,404 12,393,336 0.35% 180 2017 2,047,784 - 253,265 - 6,951,350 - 1,383,372 - 10,635,771 0.30% 154 2018 1,250,000 - 28,902 - 6,660,094 - 1,029,790 - 8,968,786 0.24% 131 2019 27,712,944 - - - 6,353,838 - 660,298 - 34,727,080 0.91% 507 2020 26,942,846 - 186,587 - 6,037,582 - 274,194 - 33,441,209 0.84% 499 2021 26,411,918 - 96,652 - 5,711,326 - - - 32,219,896 0.76% 485 2022 233,296,498 - 2,002,632 - 5,375,070 18,750,322 - - 259,424,522 6.02% 3,761 2023 225,831,468 - 1,754,910 985,983 5,023,814 18,126,085 - - 251,722,260 5.26% 3,680 Source: Note 10 of the Notes to Financial Statements
Governmental Activities Business-type Activities
143 DRAFT
City of Redondo Beach
Direct and Overlapping Governmental Activities Debt
June 30, 2023
City Assessed Valuation $ 20,512,490,095
Estimated
Share of
Percentage Outstanding Overlapping
Applicable Debt 6/30/23 Debt
Direct Debt:
Community Financing Authority Lease Revenue Bonds 2021A 100% $ 218,650,000 $ 218,650,000 Community Financing Authority Lease Revenue Refunding Bonds 2019A 100% 25,955,000 25,955,000 Community Financing Authority 2019A Unamortized Bond Premium 100% (647,448) (647,448) Total direct debt $ 243,957,552 $ 243,957,552
Overlapping Debt:
* Metropolitan Water District 0.564% $ 19,215,000 $ 108,373 Los Angeles County General Fund Obligations 1.083% 2,601,551,282 28,174,800 Los Angeles County Superintendent of Schools Certificates of Participation 1.083% 3,403,487 36,860 Los Angeles County Sanitation District No.5 Authority 8.200% 1,269,835 104,126 El Camino Community College District 14.718% 463,537,057 68,223,384 Los Angeles County Sanitation District South Bay Cities Authority 17.243% 216,354 37,306 Redondo Beach Unified School District 100% 204,951,837 204,951,837 Total overlapping debt $ 3,294,144,852 301,636,686
Total direct and overlapping debt $ 545,594,238
NOTE: * This fund is a portion of a larger agency and is responsible for debt in areas outside the City.
Source: HdL Coren & Cone, Los Angeles County Assessor and Auditor Combined 2022/2023 Lien Date Tax Rolls 144 DRAFT
City of Redondo Beach
Legal Debt Margin Information
Last Ten Fiscal Years
Assessed value $ 20,512,490,095
Debt Limit (15% of assessed value) 3,076,873,514
Debt applicable to limit -
Legal debt margin $ 3,076,873,514
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Debt limit $ 1,950,708,105 $ 2,042,646,734 $ 2,143,539,979 $ 2,258,235,466 $ 2,387,747,521 $ 2,512,486,019 $ 2,637,184,289 $ 2,796,921,319 $ 2,889,402,005 $ 3,076,873,514 Total net debt applicable to limit - - - - - - - - - -
Legal debt margin 1,950,708,105 2,042,646,734 2,143,539,979 2,258,235,466 2,387,747,521 2,512,486,019 2,637,184,289 2,796,921,319 2,889,402,005 3,076,873,514 Total net debt applicable to the limit
as a percentage of debt limit 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Source: County of Los Angeles Auditor-Controller
Fiscal Year
Legal Debt Margin Calculation for Fiscal Year 2023
Fiscal Year
145 DRAFT
City of Redondo Beach
Pledged-Revenue Coverage
Last Ten Fiscal Years
Wastewater Revenue Bonds
Less Net
Fiscal Year Ended Wastewater Operating Available Debt Service June 30, Revenue Expenses Revenue Principal Interest Coverage 2014* $ 4,311,350 $ 1,214,545 $ 3,096,805 $ - $ 208,634 14.84 2015 5,290,338 1,432,699 3,857,640 225,000 322,459 7.05 2016 5,320,916 1,575,501 3,745,415 245,000 301,988 6.85 2017 5,475,892 2,283,864 3,192,028 255,000 289,738 5.86 2018 5,521,455 2,597,120 2,924,335 265,000 279,538 5.37 2019 5,364,859 2,751,925 2,612,934 280,000 268,938 4.76 2020 5,455,997 3,148,875 2,307,122 290,000 257,189 4.22 2021 5,368,274 2,768,598 2,599,676 300,000 246,138 4.76 2022 5,332,000 2,257,488 3,074,512 310,000 234,138 5.65 2023 5,344,095 3,607,690 1,736,405 325,000 221,738 3.18
NOTE: *The Redondo Beach Public Financing Authority issued the Wastewater System Financing Project Revenue Bonds in fiscal year 2003/2004.
It was replaced in fiscal year 2013-14 with the issue of the 2014 Wastewater Refunding Revenue Bonds. 146 DRAFT
City of Redondo Beach
Demographic and Economic Statistics
Per
Personal Capita
Calendar Income * Personal Unemployment
Year Population (in thousands) Income * Rate **
2014 67,717 $ 3,593,809 $ 53,071 7.7%
2015 68,095 3,602,147 53,169 6.9%
2016 68,844 3,562,911 51,269 5.0%
2017 68,907 3,587,933 52,069 4.7%
2018 68,677 3,707,238 53,980 4.1%
2019 68,473 3,835,542 56,015 4.0%
2020 66,994 3,961,378 59,130 13.6%
2021 66,484 4,215,803 63,410 7.4%
2022 68,972 4,311,229 62,506 6.5%
2023 68,407 4,789,934 70,021 3.9%
Sources: HdL Coren & Cone, Los Angeles
California State Department of Finance
US Census Bureau
June 30, 2023
NOTES: * Personal income data was not available from the California Department of Finance subsequent to fiscal year 2019/2020. Per Capita Personal Income is based on the metropolitan area of Los Angeles-Long Beach-Anaheim, CA. Statistics not available subsequent to fiscal year 2019/2020. ** Unemployment rate is based on the metropolitan area of Los Angeles-Long Beach-Anahem, CA. 147 DRAFT
City of Redondo Beach
Principal Employers
Current Year and Nine Years Ago
Percentage Percentage
of Total City of Total City
Employer Employees Employment Employees Employment
Northrup Grumman Corporation 11,064 29.35% 4,591 14.14% Redondo Beach Unified School District 1,027 2.72% 995 3.06% The Cheesecake Factory 261 0.69% 261 0.80%
City of Redondo Beach 425 1.13% 430 1.32%
United States Postal Service 350 0.93% 260 0.80%
Prime Now LLC 233 0.62% - -
Target Stores 217 0.58% 217 0.67%
Macy's 206 0.55% 203 0.63%
Frontier 164 0.43% - -
Silverado Beach Cities 140 0.37% - -
Crowne Plaza Redondo Beach - - 339 1.04%
Nordstrom, Inc. - - 251 0.77%
DHL Global Forwarding - - 209 0.64%
Source: City of Redondo Beach
2023 2014
148 DRAFT
City of Redondo Beach
Full-Time City Government Employees by Function
Last Ten Fiscal Years
2014 2015 2016 2017 2018 2019 2020 2021 2022
Function
General Government 49 51 51 53 54 54 51 48 54
Public Safety
Police
Officers 96 93 96 96 96 96 95 92 95
Civilians 59 59 58 58 58 58 58 53 58
Fire
Firefighters and Officers 60 62 62 62 62 62 62 56 59
Civilians 3 3 3 3 5 5 5 4 5
Public Works 111 111 111 112 112 110 109 104 108
Cultural and Leisure Services 33 34 34 33 33 32 31 26 29 Housing & Community Development 15 17 17 17 18 18 18 16 14 Harbor, Business, & Transit 3 3 4 4 4 4 3 3 3
TOTAL 429 433 436 438 442 439 432 402 425
Source: City of Redondo Beach
Fiscal Year
149 DRAFT
City of Redondo Beach
Operating Indicators by Function
Last Ten Fiscal Years
2014 2015 2016 2017 2018 2019 2020 2021 2022
Public Safety
Police
Physical arrests 2,141 2,146 2,325 2,490 2,184 2,108 1,497 2,022 1,693 Traffic citations issued 4,966 4,516 3,898 4,699 4,220 4,015 2,651 3,386 2,932 Fire
Number of runs - rescues 4,338 4,604 4,702 5,025 4,665 4,791 4,472 4,561 5,503 Number of runs - structures & other 1,822 1,989 2,115 2,107 2,605 2,602 2,833 2,890 2,530 Public Works
Street rehabilitation (miles) 3.1 1.1 2.4 - 4.1 0.7 1.4 4.1 - Culture and Leisure Services
Library
Number of items borrowed 621,139 584,643 545,316 476,837 479,575 447,966 402,964 242,530 411,909 Number of visitors 333,869 350,958 343,395 332,181 308,542 314,093 210,999 18,821 134,103 Recreation and Community Services
Admissions - Seaside Lagoon 82,414 81,328 87,422 79,833 79,856 60,419 - * - * 35,367 Number of facility rentals - Seaside Lagoon 387 381 388 378 382 422 - * - * 765 Housing & Community Development
Number of permits issued 2,955 3,295 6,899 3,435 3,522 3,172 2,655 5,651 3,023 Number of plan checks issued 1,471 1,559 4,200 2,492 2,436 2,060 2,038 3,997 1,294 Number of inspections 4,411 10,326 12,827 12,276 11,748 17,007 9,723 19,130 10,372 Number of real estate reports 922 973 1,925 861 814 807 672 1,559 800 Number of bus boardings - Transit 410,585 415,259 407,272 383,112 375,545 367,087 288,912 166,176 295,365 Revenue miles - Transit 475,564 459,468 458,198 448,682 448,541 448,016 414,401 365,731 437,141 NOTE: * Seaside Lagoon did not operate for the 2019-2020 fiscal year and reopened June 18, 2021 due to the COVID-19 closure. ** Information no longer being made available as of Fiscal year 2022-2023.
Source: City of Redondo Beach - Financial Services Department Fiscal Year
150 DRAFT
City of Redondo Beach
Capital Asset Statistics by Function
Last Ten Fiscal Years
2014 2015 2016 2017 2018 2019 2020 2021 2022
Function
Public Safety
Police:
Stations 1 1 1 1 1 1 1 1 1
Sub-station 1 1 1 1 1 1 1 1 1
Fire Stations 3 3 3 3 3 3 3 3 3
Public Works
Streets (miles) 127 127 127 127 127 127 127 127 127
Streetlights * 1892 1892 1892 1892 1892 1892 1892 1892 1899 Street Traffic Controllers 84 84 84 84 84 84 84 84 84
Sanitary sewers (miles) 112 112 112 112 112 112 112 112 112 Culture and Leisure Services
Parks 15 15 15 15 15 15 15 15 15
Parkettes 13 13 13 13 13 13 13 13 13
Total Park Acreage 143.26 143.26 143.26 143.26 143.26 143.26 143.26 143.26 143.26 Boat Slips 1509 1509 1509 1509 1509 1509 1509 1509 1509 Harbor acreage:
Total water area (exclusive of the pier) 107 107 107 107 107 107 107 107 107 Total land area 52.5 52.5 52.5 52.5 52.5 52.5 52.5 52.5 52.5 Libraries 2 2 2 2 2 2 2 2 2
Community Centers 5 5 5 5 5 5 5 5 5
NOTE: * Methodology modification made in fiscal year 2004/2005 to reflect city-owned street lights only.
Source: City of Redondo Beach
Fiscal Year
151 DRAFT
City of Redondo Beach
Certification of Continuing Disclosure
Redondo Beach Community Financing Authority 2014 Wastewater Refunding Revenue Bonds (Wastewater System Financing Project)
June 30, 2023
This Certification of Continuing Disclosure is provided by the City of Redondo Beach (“the City”) and the Redondo Beach Community Financing Authority through US Bank, as Dissemination Agent pursuant to a Continuing Disclosure Certificate dated March 25, 2014 executed and delivered by the City of Redondo Beach and the Community Financing Authority and the Dissemination Agent in connection with the issuance of $7,230,000 Refunding Revenue Bonds, City of Redondo Beach Wastewater System Financing Project Bonds (“the Bonds”). The Bonds were issued pursuant to an Indenture of Trust dated as of March 25, 2014 between the Financing Authority and US Bank. The proceeds of the Bonds were issued to provide funds to (a) finance the Improvements and related facilities which constitute part of the Wastewater Enterprise of the City, (b) fund capitalized interest on the Bonds through November 1, 2014, (c) fund a reserve fund for the Bonds, and (d) pay the cost of issuance for the Bonds.
This Certification is made pursuant to the requirements of Section 3(a) of the Continuing Disclosure Certificate with respect to the 2020-21 fiscal year.
The City and the Community Financing Authority hereby report the following:
1. The audited financial statements of the City, prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board, for the fiscal year ended June 30, 2021 comprise the book in which this report is included.
2. During the fiscal year ended June 30, 2021, neither the City nor the Community Financing Authority has given or caused to be given notice of the occurrence of any of the following events:
a. Principal and interest payment delinquencies;
b. Non-payment related defaults;
c. Unscheduled draws on debt service reserves reflecting financial difficulties; d. Unscheduled draws on credit enhancements reflecting financial difficulties; e. Substitution of credit or liquidity providers, or their failure to perform; f. Adverse tax opinions or events affecting the tax-exempt status of the security; g. Modifications to rights of security holders;
h. Contingent or unscheduled bond calls;
i. Defeasances;
j. Resale, substitution, or sale of property securing repayment of the securities; or k. Rating changes
152 DRAFT
Sewer Rates Per Month
2014 2015 2016 2017 2018 2019 2020 2021 2022
Use Classification
Each single family dwelling unit $ 13.25 $ 16.25 $ 16.25 $ 16.25 $ 16.25 $ 16.25 $ 16.25 $ 16.25 $ 16.25 Each unit in a 2-3 unit condo structure 13.25 16.25 16.25 16.25 16.25 16.25 16.25 16.25 16.25 Each unit in a 2-3 unit apartment structure 10.31 12.64 12.64 12.64 12.64 12.64 12.64 12.64 12.64 Each unit in a 4 or more unit condo structure 10.31 12.64 12.64 12.64 12.64 12.64 12.64 12.64 12.64 Each unit in a 4 or more unit apartment structure 7.09 8.70 8.70 8.70 8.70 8.70 8.70 8.70 8.70 Commercial/Industrial/Institutional parcels 1.13 * 1.39 * 1.39 * 1.39 * 1.39 * 1.39 * 1.39 * 1.39 * 1.39 * Source: City of Redondo Beach
City of Redondo Beach
Last Ten Fiscal Years
NOTE: The Redondo Beach Public Financing Authority issued the Wastewater System Financing Project Revenue Bonds in fiscal year 2003/2004. A reissue of the Bonds was done in fiscal year 2013/2014 by the Community Financing Authority. * Per 100 cubic feet of average monthly water usage. 100 cubic feet of water is equal to 748 gallons, average monthly water usage is established based on the latest actual annual water usage record available to the City. On an annual basis, the city will recalculate the monthly charge by using the latest available annual water usage record of each non-residential user at the same $1.13 per 100 cubic feet rate to set a new monthly rate. Any water proven to be used for boilers, cooling towers or similar devises that will not be discharged into the sewer system may be deducted from the annual water usage record for rate calculation purposes.
153 DRAFT
City of Redondo Beach
Top Ten Customers - Sewage Usage
June 30, 2023
% of
Account Name Type of Use Usage (ccf) Billed Amount Revenue AES Redondo Beach LLC Power Plant 150,127 $208,677 3.8% Northrop Grumman Systems Aerospace 45,419 $63,132 1.2%
Redondo Beach Unified - South Bay Union High Education 26,163 $36,367 0.7% Hilton Garden Inn Hotel 16,464 $22,885 0.4%
Marina Way Mole B Harbor Facilities 16,181 $22,492 0.4% City of Redondo Beach Leased Properties Harbor Facilities 16,151 $22,450 0.4% Beach Cities Health District Hospital 15,970 $22,198 0.4% Sonesta Redondo Beach & Marina Hotel 14,276 $19,844 0.4% South Bay Center SPE LLC Shopping Mall 12,357 $17,176 0.3% Village at Redondo LLC - 160 Unit Apartment 12,017 $16,704 0.3%
8.3%
154 DRAFT
City of Redondo Beach
Sewer Connections by Type of Customer
Last Ten Fiscal Years
2014 2015 2016 2017 2018 2019 2020 2021 2022
Type of Customer
Residential 13,104 13,105 13,105 13,111 13,113 13,114 13,116 13,117 13,121 Industrial 61 61 59 59 59 58 57 57 57
Commercial 463 461 462 464 463 465 465 464 458
Institutional 59 59 59 58 58 57 56 56 56
Mixed use 43 43 43 43 43 43 43 43 44
Total 13,730 13,729 13,728 13,735 13,736 13,737 13,737 13,737 13,736 NOTE: The Redondo Beach Public Financing Authority issued the Wastewater System Financing Project Revenue Bonds in fiscal year 2003/2004.
A reissue of the Bonds was done in fiscal year 2013/2014 by the Community Financing Authority.
Source: City of Redondo Beach
155 DRAFT
City of Redondo Beach
Certification of Continuing Disclosure
Redondo Beach Community Financing Authority Lease Revenue Refunding Bonds Series 2019A (Leaseback Agreement)
June 30, 2023
This Certification of Continuing Disclosure is provided by the City of Redondo Beach (“the City”) and the Redondo Beach Community Financing Authority through US Bank, as Dissemination Agent pursuant to a Continuing Disclosure Certificate dated February 1, 2019 executed and delivered by the City of Redondo Beach and the Community Financing Authority and the Dissemination Agent in connection with the issuance of $28,015,000 Lease Revenue Refunding Bonds (“the Bonds”). The Bonds were issued pursuant to an Indenture of Trust dated as of February 1, 2019 between the Financing Authority and US Bank. The proceeds of the Bonds were issued to provide funds to (a) refund the City of Redondo Beach’s (the “City”) $8,300,000 Leaseback Agreement (Redondo Beach Pier Plaza), dated as of March 1, 2012, by and between Compass Bank and the City, currently outstanding in the principal amount of $6,314.012.91; (b) refund the City’s $2,700,000 Leaseback Agreement (Redondo Beach International Boardwalk Project), dated as of May 1, 2012 by and between Compass Bank and the City, currently outstanding in the principal amount of $2,021,296.58; (c) refund the City’s $12,500,000 Leaseback Agreement (Redondo Beach Marina Project), dated as of May 1, 2014, by and between Compass Bank and the City, currently outstanding in the principal amount of $10,076,474.18; (d) finance the purchase of a Sublease between the City and Redondo Fisherman’s Cove Company; and (e) pay costs of issuance of the Bonds.
This Certification is made pursuant to the requirements of Section 3 and 4 of the Continuing Disclosure Certificate with respect to the 2020-21 fiscal year.
The City and the Community Financing Authority hereby report the following:
1. The audited financial statements of the City, prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board, for the fiscal year ended June 30, 2021 comprise the book in which this report is included.
2. During the fiscal year ended June 30, 2021, neither the City nor the Community Financing Authority has given or caused to be given notice of the occurrence of any of the following events:
a. Principal and interest payment delinquencies;
b. Non-payment related defaults;
c. Unscheduled draws on debt service reserves reflecting financial difficulties; d. Unscheduled draws on credit enhancements reflecting financial difficulties; e. Substitution of credit or liquidity providers, or their failure to perform; f. Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices of determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds; g. Modifications to rights of security holders;
h. Contingent or unscheduled bond calls;
i. Defeasances;
j. Resale, substitution, or sale of property securing repayment of the securities; k. Rating changes
l. Bankruptcy, insolvency, receivership or similar event of the Obligated Person; m. The consummation of a merger, consolidation, or acquisition involving an Obligated Person or the sale of all or substantially all of the assets of the Obligated Person, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms; and
n. Appointment of a successor or additional trustee or the change of name of a trustee. 156 DRAFT