City of Ripon | California
Financial Statements
For the Year Ended June 30, 2024
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Financial Statements
TABLE OF CONTENTS
PAGE
Independent Auditor’s Report ............................................................................................................................................ 1 Management’s Discussion and Analysis ............................................................................................................................. 5 Basic Financial Statements:
Government-Wide Financial Statements:
Statement of Net Position – Modified Cash Basis ...................................................................................................... 18 Statement of Activities – Modified Cash Basis ........................................................................................................... 19 Fund Financial Statements:
Governmental Funds:
Balance Sheet – Modified Cash Basis ................................................................................................................... 21 Statement of Revenues, Expenditures and Changes in
Fund Balances – Modified Cash Basis ............................................................................................................... 22 Proprietary Funds:
Statement of Net Position – Modified Cash Basis ................................................................................................ 23 Statement of Revenues, Expenses and Changes in Fund
Net Position – Modified Cash Basis .................................................................................................................. 24 Fiduciary Funds:
Private Purpose Trust Fund:
Statement of Fiduciary Net Position – Modified Cash Basis ........................................................................ 25 Statement of Changes in Fiduciary Net Position – Modified Cash Basis ...................................................... 26 Notes to the Basic Financial Statements…………………………………………………………………………………………………………….………….28 Supplementary Information:
Non-Major Special Revenue Funds:
Combining Balance Sheet – Modified Cash Basis ........................................................................................................ 51 Combining Statement of Revenues, Expenditures and Changes in Fund Balances – Modified Cash Basis ...................................................................................................................... 56 Additional Information on the Successor Agency Trust Fund ........................................................................................... 61 2024.06.30 RIPON Financial Statements
1 INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and
Members of the City Council
City of Ripon, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying modified cash basis financial statements of the governmental activities, the businesstype activities, each major fund, and the aggregate remaining fund information of the City of Ripon, California (the City), as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.
In our opinion, the modified cash basis financial statements referred to above present fairly, in all material respects, the respective modified cash basis financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Ripon, California, as of June 30, 2024, and the respective changes in modified cash basis financial position, for the year then ended in accordance with the modified cash basis of accounting.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Emphasis of Matter—Basis of Accounting
We draw attention to Note 1 of the financial statements, which describes the basis of accounting. The financial statements are prepared on the modified cash basis of accounting, which is a basis so of accounting other than accounting principles generally accepted in the United States of America. Our opinions are not modified with respect to this matter.
Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. 2024.06.30 RIPON Financial Statements
2 In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions.
Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
Exercise professional judgment and maintain professional skepticism throughout the audit. Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed. Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The accompanying combining and individual nonmajor fund financial statements and additional information on the Successor Agency Trust Fund are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements.
The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial statements and additional information on the Successor Agency Trust Fund are fairly stated, in all material respects, in relation to the basic financial statements as a whole.
2024.06.30 RIPON Financial Statements
3 Other Information
Management is responsible for the other information included in the annual report. The other information comprises the management’s discussion and analysis but does not include the basic financial statements and our auditor’s report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.
In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated October 4, 2024, on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.
Clovis, California
October 4, 2024
2024.06.30 RIPON Financial Statements
4 MANAGEMENT’S DISCUSSION AND ANALYSIS
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Management’s Discussion and Analysis
5 The purpose of the Management’s Discussion and Analysis is to provide a summary of the City’s financial activities for the fiscal year ended June 30, 2024. The City’s financial statements are presented on a modified cash basis of accounting, as described in the basis of accounting paragraphs noted on page 7. Please read this management’s discussion and analysis in conjunction with the City’s financial statements that begin on page 18.
FINANCIAL HIGHLIGHTS
The net position of the City is the difference between total assets and total liabilities and includes restricted and unrestricted funds of both governmental and business-type activities. As summarized in Table 2 of this memorandum, the City’s assets exceeded its liabilities by $57,845,566 (net position) for the fiscal year ended June 30, 2024. This compares favorably to the previous year’s net position of $56,213,535. The net increase includes a 10% decrease of capital related debt, 70% of restricted funds and 40% of unrestricted funds. The net position for the fiscal year ended June 30, 2024 is comprised of the following:
Capital related debt of $5,120,000 represents debt recorded in the proprietary funds for capital assets. The debt is associated with the water and sewer enterprise funds. The City does not capitalize capital assets; therefore, this category solely reflects the debt. Capital related debt of $5,120,000 constitutes a negative net position. Restricted net position of $38,129,260 represents the funds restricted for public safety including Vehicle Abatement, Drug Seizure and Police Department Grants; street construction and maintenance, assessment districts, Development Related fees, and low- and moderate-income housing. Unrestricted net position of $24,836,306 represents the funds that are not otherwise restricted and may be committed or assigned based on priorities and/or policies established by the City Council.
Table 1 shows a summary of unrestricted funds:
TABLE 1
2024 2023
General Fund Contingencies/Reserves:
Sick Leave Contingency $ 431,234 $ 419,276
PERS Contingency * 1,370,535 1,681,847
Healthcare Contingency 222,793 217,233
Liability/Workers Comp Litigation Self-Insured Retention Contingency 668,379 651,698 Litigation/Natural Disaster Contingency 550,378 536,311 Operating Reserve 7,381,749 6,100,161
Street and Road Reserve Fund 4,673,483 3,461,927
General Capital Funds:
Parks and Recreation 3,922,529 3,957,241
CNG Station Capital Reserve 273,507 216,448
Department Capital Funds 2,960,005 2,391,461
Corporation Yard 498,014 1,882,705
Deficit Restricted Funds (12,720) -
Enterprise Funds * 1,585,108 * 1,392,537
Total Unrestricted Funds 24,836,306 $ 22,597,533 $
* PERS Contingency funds are in a 115 trust with limited use related to paying CalPERS related exepenses only. ** Enterprise funds are considered unrestricted however, these must be used in accordance with the laws governing the City's various enterprise funds.
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Management’s Discussion and Analysis
6 Below is a summary of financial policies by the City Council that are evaluated each year to ensure compliance. RESERVE AND CONTINGENCY FUNDS
o During the fiscal year ended June 30, 2019, City staff completed a Reserve Study and City Council approved a policy regarding reserve balances. These policies set goals for the General Fund Reserve, Sick Leave Contingency Reserve, CalPERS Reserve, Healthcare Deductible Reimbursement Reserve, Workers Compensation/Liability Self Insured Retention Reserve and the Natural Disaster/Litigation Reserve. These reserves were funded during the fiscal year ended June 30, 2019 through the budgeting process. These balances are reviewed annually to confirm the City is in compliance with the policies. LANDSCAPE MAINTENANCE DISTRICT DEFICITS
o During the fiscal year ended June 30, 2019, City Council created a policy of transferring General Fund dollars to the Landscape Maintenance Districts at the end of the year that have an annual operating deficit and do not have a fund balance to cover the annual deficit. This analysis is completed at the end of the fiscal year and transfers are presented to the City Council for approval. For fiscal year ended June 30, 2024, $65,251 was transferred from the General Fund to five different Landscape Maintenance Districts to cover their deficit fund balances.
STREET AND ROAD RESERVES
o In April 2015, the City Council approved Resolution 15-23 adopting a Street and Road Reserve Policy that requires a minimum of 33% of the annual General Fund surplus to be set aside for the funding of reconstructing streets and roads in Ripon that have exceed their useful life. o In addition, during the fiscal year ending June 30, 2023, a Street and Road Reconstruction Fund was created, which Is funded by 50% of the surplus of Street and Roads’ longer term operating revenue less operating expenditures to be used for Street and Road reconstruction project.
USING THIS ANNUAL REPORT
This annual report is presented in a format consistent with the presentation requirements of the Governmental Accounting Standards Board, as applicable to the City’s modified basis of accounting.
Report Components
This annual report consists of the following four parts:
1) Government-Wide Financial Statements. The Statement of Net Position and the Statement of Activities (on pages 18-19) provide information about the activities of the City government-wide (or as a whole) and present a longerterm view of the City’s finances. 2) Fund Financial Statements. Fund financial statements (beginning on page 21) focus on the individual parts of the City government. Fund financial statements also report the City’s operations in more detail than the governmentwide statements by providing information about the City’s most significant (major) funds. For governmental activities, these statements tell how these services were financed in the short term, as well as what remains for future spending. For proprietary activities, these statements offer short-term and long-term financial information about the activities, which the City operates like businesses, such as the water, sewer and refuse services. 3) Notes to the Financial Statements. The notes to the financial statements are an integral part of the governmentwide and fund financial statements and provide expanded explanation and detail regarding the information reported in the statements.
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Management’s Discussion and Analysis
7 4) Supplementary Information. The annual report includes optional financial information, such as management’s discussion and analysis, combining statements for non-major funds (that are added together and shown in the fund financial statements in a single column) and additional information on the Successor Agency Trust Fund.
This other supplementary financial information is provided to address certain specific needs of various users of the City’s annual report.
Basis of Accounting
The City’s financial statements are presented based on a modified cash basis of accounting. This modified cash basis of accounting is a basis of accounting other than generally accepted accounting principles in the United States of America.
Basis of accounting is a reference to when financial events are recorded, such as the timing for recognizing revenues, expenses, and their related assets and liabilities. Under the City’s modified cash basis of accounting, revenues and expenses and certain related assets, liabilities, and deferred inflows and outflows are recorded when they result from cash transactions or events.
As a result of the use of this modified cash basis of accounting, certain assets and their related revenues (such as accounts receivable and revenue for billed or provided services not yet collected, and other accrued revenue and receivables) and certain liabilities and their related expenses or expenditures (such as accounts payable and expenses for goods or services received but not yet paid, and other accrued expenses and liabilities) are not recorded in these financial statements, with the exception of long-term liabilities arising from cash transactions. In addition, other economic assets, deferred outflows, liabilities, and deferred inflows that do not arise from a cash transaction or event (such as donated assets and postemployment benefit obligations) are not reported, and the measurement of reported assets and liabilities does not involve adjustment to fair value. Lastly, the City does not recognize its investment in capital assets in its Statement of Net Position. Therefore, when reviewing the financial information and discussion within this annual report, the reader should keep this in mind.
Reporting the City as a Whole
The City’s Reporting Entity Presentation
This annual report includes all activities for which the City of Ripon’s City Council is fiscally responsible.
City management considered all potential component units for inclusion in the reporting entity by applying the criteria set forth in accounting principles generally accepted in the United States of America. The City concluded that there are no potential component units which should be included in the reporting entity.
The Government-Wide Statement of Net Position and the Statement of Activities The government-wide financial statements are presented on pages 18 and 19. The Statement of Net Position and Statement of Activities report information about the City as a whole and its activities. These statements include all the City’s assets, liabilities, and deferred inflows and outflows resulting from the use of the modified cash basis of accounting, as further defined in the notes to the financial statements.
These two statements report the City’s net position and changes therein. The City’s net position, which is the difference among assets, deferred outflows, liabilities, and deferred inflows is one way to measure the City’s financial health or financial position. Over time, increases or decreases in the City’s net position are one indicator of whether its financial health is improving or deteriorating. Other nonfinancial factors should also be considered, such as changes in the City’s sales tax base and the condition of the City’s roads, to assess the overall health of the City. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Management’s Discussion and Analysis
8 1) Governmental activities. Most of the City’s basic services are reported here, including the general administration, police, streets, public works and recreation. Property taxes, sales and use taxes, charges for services, operating grants, and contributions finance most of these activities. 2) Business-type activities. The City charges a fee to customers to help it cover all or most of the cost of certain services it provides. The City’s water, sewer, and refuse service are reported here.
Reporting the City’s Most Significant Funds
The Fund Financial Statements
The City has three types of funds: governmental, proprietary and fiduciary, which are noted below. Some funds are required to be established by State law. However, the City Council establishes certain other funds to help it control and manage money for particular purposes or to show that it is meeting legal responsibilities for using certain taxes, grants, and other money.
Governmental Funds. Most of the City’s basic services are reported in governmental funds that focus on how money flows into and out of those funds and the balances left at year-end that are available for spending. These funds report the acquisition of capital assets and payments for debt principal as expenditures, not changes to asset and debt balances. The governmental fund statements provide a detailed short-term view of the City’s general government operations and the basic services it provides. The City uses the modified cash basis of accounting and, accordingly, there are no reconciling differences between the governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds. The City considers the General Fund, Streets & Roads Fund, and Capital Project Fund to be its significant, or major, governmental funds.
All other governmental funds are aggregated in a single column titled “Non-major Special Revenue Funds.” Proprietary Funds. The City charges customers for the services it provides. These services are generally reported in proprietary funds. Proprietary funds are reported in the same way all activities are reported in the Statement of Net Position and Statement of Activities. For example, principal payments on long-term debt are recorded as a reduction to the liability. The City’s proprietary (enterprise) fund financial statements are essentially the same as the business-type activities we report in the government-wide financial statements. The City utilizes the modified cash basis of accounting and, accordingly, capital assets are not capitalized or depreciated. The City has three enterprise funds: Water, Sewer, and Refuse.
Fiduciary Funds. Private Purpose Trust Funds are established to serve as the custodian for assets held in a trustee or agency capacity for others and, therefore, cannot be used to support the City’s own programs. The City has one private purpose trust fund known as the Successor Agency Trust Fund which holds the assets and accounts for the activities related to the winding down of the former Redevelopment Agency.
Net Position – Modified Cash Basis
The City’s combined net position resulting from modified cash basis transactions or events increased from $56,213,535 to $57,845,566 between fiscal years 2023 and 2024. Looking at the net position and net expenses of governmental and business-type activities separately, governmental activities had a larger increase than business-type activities.
Table 2 on the following page shows a breakdown and comparison of these activities. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Management’s Discussion and Analysis
9 TABLE 2:
Total
Percentage
Change
2023 2024 2023 2024 2023 2024 2023-2024
Cash and investments $ 32,092,438 $ 35,725,924 $ 1,834,670 $ 1,834,572 $ 33,927,108 $ 37,560,496 11%Cash and investments - restricted 28,695,963 25,987,889 492 28,696,455 594 25,988,483 -9% Internal balances 249,464 442,133 (442,133) (249,464) - - 0% Total assets 61,963,277 61,230,534 1,393,029 1,585,702 62,623,563 63,548,979 1% Long-term liabilities:
Loan due to private-purpose trust funds 550,028 583,413 - - 550,028 583,413 6%Debt due within one year - - 740,000 775,000 740,000 775,000 5%Debt due in more than one year - - 5,120,000 4,345,000 5,120,000 4,345,000 -15% Total liabilities 583,413 550,028 5,860,000 5,120,000 6,410,028 5,703,413 -11% Capital related debt - - (5,860,000) (5,120,000) (5,860,000) (5,120,000) -13% Restricted for:
Public safety 189,848 197,505 - - 189,848 197,505 4%Transit - 711,761 - 711,761Street construction and maintenance 4,724,596 5,348,392 - - 4,724,596 5,348,392 13%Assessment districts 337,421 389,180 - - 337,421 389,180 15%Capital outlay 24,168,796 21,064,288 - - 24,168,796 21,064,288 -13%County development fees - - - - - - 0%Mitigation fees 8,235,220 8,460,409 - - 8,235,220 8,460,409 3%Low and moderate income housing 1,819,629 1,957,131 - - 1,819,629 1,957,131 8%Debt service - - 492 594 492 594 21% Unrestricted 21,204,996 23,251,198 1,392,537 1,585,108 22,597,533 24,836,306 10% Total Net Position $ 60,680,506 61,379,864 $ (4,466,971) $ (3,534,298) $ 56,213,535 $ 57,845,566 $ 3% Governmental Activities Business-Type Activities Total
The net position of the City’s governmental activities increased 1.15% to $61,379,864. However, $38,128,666 of this amount is restricted regarding the purposes for which it can be used. Consequently, unrestricted amounts showed $23,251,198 at the end of this year. Unrestricted funds include funds that the Council has the ability to assign or commit based on the priorities and policies of the City Council and are summarized in Table 1 under Financial Highlights. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Management’s Discussion and Analysis
10 Net Position – Modified Cash Basis
(10,000,000)
-
10,000,000
20,000,000
30,000,000
40,000,000
50,000,000
60,000,000
70,000,000
Governmental Business-Type
2023
2024
Changes from 2023 to 2024 reflect an increase of 2.90% in net position, an increase of 1.15% for governmental activities and an increase of 20.88% for business-type activities.
Changes in Net Position – Modified Cash Basis
For the year ended June 30, 2024, net position (resulting from modified cash basis transactions or events) changes are included in Table 3.
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CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Management’s Discussion and Analysis
11 TABLE 3:
Total
Percentage
Change
2023 2024 2023 2024 2023 2024 2023-2024
RevenuesProgram revenues:
Charges for services 3,350,038 $ 3,557,945 $ 8,334,445 $ 8,563,662 $ 11,684,483 $ 12,121,607 $ 4% Operating grants and contributions 1,343,278 3,117,498 - - 1,343,278 3,117,498 132% Capital grants and contributions 4,307,517 4,488,868 421,925 936,571 4,729,442 5,425,439 15% General revenues
Taxes:
Property taxes 2,608,196 2,779,614 - 2,608,196 - 2,779,614 7% Sales and use taxes 4,620,254 4,581,976 - 4,620,254 - 4,581,976 -1% Other 284,189 259,023 194,422 214,883 478,611 473,906 -1% Motor vehicle in lieu 1,911,505 2,013,090 - 1,911,505 - 2,013,090 5%American rescue plan act 1,959,940 - - 1,959,940 - - -100% Investment income 842,508 2,421,810 30,265 49,676 872,773 2,471,486 183% Miscellaneous 622,716 785,555 - - 785,555 622,716 -21%
Total revenue 23,842,540 22,012,980 8,981,057 9,764,792 30,994,037 33,607,332 8% ExpensesAdministrative 78,702 68,589 - - 78,702 68,589 -13% Legislative 3,681 3,774 - - 3,681 3,774 3%
Police 8,857,224 9,007,200 - - 8,857,224 9,007,200 2%
Streets and public works 1,768,042 1,982,836 - - 1,768,042 1,982,836 12% Culture and recreation 2,273,477 2,353,425 - - 2,273,477 2,353,425 4% Redevelopment 212,988 201,686 - - 212,988 201,686 -5%
Other 144,429 185,663 - - 185,663 144,429 -22%
Capital outlay 4,764,584 12,278,031 - - 4,764,584 12,278,031 158% Water - - 2,133,579 2,246,568 2,133,579 2,246,568 5%
Sewer - - 1,185,154 1,199,862 1,185,154 1,199,862 1%
Refuse - - 2,300,395 2,488,901 2,300,395 2,488,901 8%
Total expenses 26,039,970 18,144,361 5,619,128 5,935,331 23,763,489 31,975,301 35% Excess (deficiency) before transfers 3,868,619 (2,197,430) 3,361,929 3,829,461 7,230,548 1,632,031 -77% Transfers 2,896,788 2,468,116 (2,468,116) (2,896,788) - - Extraordinary item (see note 14) - 1,757,494 - - 1,757,494 - Increase in net position 8,094,229 699,358 893,813 932,673 8,988,042 1,632,031 -82% Net position - beginning 60,680,506 52,586,277 (5,360,784) (4,466,971) 47,225,493 56,213,535 Net position - ending $ 60,680,506 61,379,864 $ (4,466,971) $ (3,534,298) $ 56,213,535 $ 57,845,566 $ Governmental Activities Business-Type Activities Total
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CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Management’s Discussion and Analysis
12 Governmental Activities
The Statement of Activities format on page 19 of this report is significantly different from a typical Statement of Revenues, Expenses and Changes in Fund Balance. Expenses are listed in the first column, with revenues from that particular program reported to the right. The result is net (expense) revenue. This type of format highlights the relative financial burden of each of the functions on the City’s taxpayers. It also identifies how much each function draws from the general revenues or if it is self-financing through fees and grants or contributions. All other governmental revenues are reported as general. It is important to note that all taxes are classified as general revenue, even if restricted for a specific purpose.
For the year ended June 30, 2024, the City’s governmental activities sources and uses follow:
15%
13%
19%
12%
19%
1% 8%
0%
10%
3%
Sources of Funds for Governmental Activities
Charges for services
Operating grants and
contributions
Capital grants and
contributions
Property taxes
Sales and use taxes
Other taxes
Motor vehicle in lieu
American rescue plan act
Investment income
Miscellaneous
0.26%
0.01%
34.59%
7.61% 9.05%
0.77%
0.55%
47.15%
Uses of Funds in Governmental Activities
Administrative
Legislative
Police
Streets and public works
Culture and recreation
Redevelopment
Other
Capital outlay
For the year ended June 30, 2024, total expenses for governmental activities resulting from modified cash basis transactions or events amounted to $26,039,970. Of these total expenses, taxpayers and other general revenues funded $12,678,229, and those directly benefiting from the program funded $7,606,366 from grants and other contributions, and $3,557,945 from charges for services.
Business-Type Activities
The business-type activities’ net revenue (expenses), before transfers, resulting from modified cash basis transactions or events follow: The water, sewer and refuse service activities reported net revenues (expenses) of $2,151,745, $1,500,082, and $177,634, respectively.
-
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
Water Sewer Refuse
Business-type Activities Revenues and Expenses - Modified Cash Basis Revenues
Expenses
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Management’s Discussion and Analysis
13 A FINANCIAL ANALYSIS OF THE CITY’S FUNDS
Certain funds experienced noteworthy changes from the prior year and are highlighted as follows:
General Fund:
Sales and use taxes were at $4.6 million for both fiscal year ending June 30, 2023 and 2024. There was no significant change from the prior fiscal year. Development-related General Fund fees were conservatively budgeted at $250,000, but the amount actually received by the City was $486,505. Property taxes increased 7% from the prior fiscal year and continues to remain a stable source of revenue for the City.
The City continues to receive the $250,000 administrative allowance for administering the winding-down of the Redevelopment Agency. At this time, it is not clear when the City would no longer be receiving this allowance. Investment income increased from $618,738 to $732,652 from the prior fiscal year to the current fiscal year. This is a function to a unique time in the economy and we do not expect this to continue.
Street & Roads Fund:
The City Council has approved policies that established certain Streets and Roads Reserve Funds to reconstruct the roads that have structurally failed. The fund balance in the reserve funds is $4,673,483 . Included in the Non-Major Special Fund revenue funds of the financial statements are the Highway User taxes and other street and road operating funds. The funds available for Street & Roads projects have increased over the last couple of years—as of June 30, 2024, the funds designated for the purposes of streets and roads is $5,348,393.
This is largely as a result of receiving grants to fund the Stockton Avenue Rehabilitation project. The City is planning several large street and road rehabilitation projects over the next two years with an estimated construction cost of $4 million.
Capital Project Fund:
Capital Outlay expenditures increased $7,513,447 from the prior year. Below is a list of major capital expenditures that were incurred during the current fiscal year:
o Corporation Yard Construction - $8,421,000
o Police Department expenditures including Action Turning Targets, Dispatch Recording Services, and Portable and vehicle radios - $62,000; $36,000; and $1,014,000 respectively o Illuminated LED monument Sign – $30,000
o Planning expenditures including new GIS system and Housing Element Update - $55,000 and $46,000 o Police Vehicles (3) - $187,000
o Public Works Vehicles (3) – $198,000
o Equipment for Parks Maintenance - $22,000
o South County Water Project - $28,000
o Pool Renovations - $119,000 (split cost with Ripon Unified School District) o Water, Sewer & Storm Drain expenses related to the Corporation Yard project - $348,000; $599,000; and $341,000; respectively.
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Management’s Discussion and Analysis
14 Water, Sewer, and Refuse Funds:
The City continues to analyze its utility rates based upon a rate study that was completed in 2020. In accordance with Proposition 218, the City Council approved rate increases to occur over a 5-year period. The final rate increases approved as part of that study will be implemented in February 2025. The utility rate study projected increases to water, sewer, and refuse rates during fiscal year 2023/2024 of 2%, 4%, and 4%, respectively. The City Council has directed staff to re-analyze the financial position of each Enterprise Fund each year to decide if any rate needs to be increased based upon the approved increases. During the current fiscal year, utility rates for water, sewer, and refuse increased as projected. There have been significant increases in refuse expenditures due to State mandates. Staff is tracking these increases to report to the City Council.
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets – Modified Cash Basis
The City does not capitalize capital assets.
Long-Term Debt – Modified Cash Basis
At June 30, 2024, the City had $5,703,413 in long-term debt arising from modified cash basis transactions or events, compared with $6,410,028 at June 30, 2023. The following is a summary of the debt as of June 30, 2024:
Debt
Ending Balance:
June 30, 2024 Maturity Date
2011 Sewer Bonds $ October 2025 375,000
2006 Water Revenue Bonds 3,725,000 October 2032
2012 Water Revenue Bonds 1,020,000 October 2027
Parks & Recreation loan to City and
Redevelopment Agency Due on demand 583,413
Total $ 5,703,413
At June 30, 2024, the City’s Private-Purpose Trust Fund (Former Ripon Redevelopment Agency) had $19,331,391 in longterm debt arising from the modified cash basis transactions or events, compared with $19,556,098 at June 30, 2022. This debt is related to redevelopment tax allocation bonds. In 2020, this debt was refinanced to take advantage of a $832,000 savings. The City Council elected to structure the bond refinancing in order to receive these savings from 2021 to 2026.
The savings from the bond refinancing will be transferred to the CalPERS 115 Trust.
ECONOMIC OUTLOOK AND MAJOR INITIATIVES
The City’s budget for the upcoming fiscal year ending June 30, 2025 is fairly consistent with the year ended June 30, 2024.
The City staffing levels for the year ending June 30, 2025 is expected to increase compared to the year ended June 30, 2023 due to the addition of a temporary police officer trainee position and a maintenance position.
The City’s Redevelopment Successor Agency expects to continue to receive the $250,000 administrative allowance for administering the winding-down of the Redevelopment Agency for the upcoming fiscal years, but is projected to be reduced or eliminated in the future.
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Management’s Discussion and Analysis
15 The City continues to focus on mitigating the CalPERS unfunded accrued liability associated with the sworn police officer retirement plan, which was $7,112,876 as of the June 30, 2023 CalPERS Valuation Report. During the fiscal year ending June 30, 2023, the City established a Section 115 trust to help mitigate increases to the City’s unfunded accrued liability.
The City has transferred $1,436,641 to a section 115 Trust that allows the City to earn interest at a higher rate than what the City typically realizes. The balance in this Trust at June 30, 2024 is $1,681,847. The use of these funds is limited to payments to CalPERS for Normal Costs or paying down the unfunded liability. These funds will be used when there is a deficit in the City’s General Fund. In addition, a $250,000 prepayment was made towards the City’s unfunded accrued liability in fiscal year ended June 30, 2018. It is important to continue to monitor CalPERS increasing rates and unfunded accrued liability.
CONTACTING THE CITY’S FINANCIAL MANAGEMENT
This report is designed to provide our citizens, taxpayers, customers, and creditors with a general overview of the City’s finances and to demonstrate the City’s accountability for the money it receives. If you have questions about this report or need additional information, please contact the City Clerk’s Office at 259 N. Wilma Avenue, Ripon, California 95366, or telephone (209) 599-2108.
2024.06.30 RIPON Financial Statements
16 BASIC FINANCIAL STATEMENTS
2024.06.30 RIPON Financial Statements
17 GOVERNMENT-WIDE FINANCIAL STATEMENTS
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Statement of Net Position – Modified Cash Basis
The notes to the basic financial statements are an integral part of this statement. 18 Governmental Business-Type
Activities Activities Total
ASSETS
Cash and investments 35,725,924 $ 1,834,572 $ 37,560,496 $ Cash and investments - restricted 25,987,889 594 25,988,483 Internal balances 249,464 (249,464) -
Total assets 61,963,277 1,585,702 63,548,979
LIABILITIES
Loan due to private-purpose trust funds 583,413 - 583,413 Long-term liabilities:
Debt due within one year - 775,000 775,000
Debt due in more than one year - 4,345,000 4,345,000
Total liabilities 583,413 5,120,000 5,703,413
NET POSITION
Capital related debt - (5,120,000) (5,120,000)
Restricted for:
Public safety 197,505 - 197,505
Transit 711,761 - 711,761
Street construction and maintenance 5,348,392 - 5,348,392 Assessment districts 389,180 - 389,180
Capital projects 21,064,288 - 21,064,288
Mitigation fees 8,460,409 - 8,460,409
Low and moderate income housing 1,957,131 - 1,957,131
Debt service - 594 594
Unrestricted 23,251,198 1,585,108 24,836,306
Total net position (deficit) 61,379,864 $ (3,534,298) $ 57,845,566 $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Statement of Activities – Modified Cash Basis
The notes to the basic financial statements are an integral part of this statement. 19 Operating Capital
Charges for Grants and Grants and Governmental Business-Type Direct Indirect Total Services Contributions Contributions Activities Activities Total Functions/ProgramsGovernmental activities:
Administrative 1,934,902 $ (1,866,313) $ 68,589 $ 519,619 $ - $ 36,657 $ 487,687 $ - $ 487,687 $ Legislative 402,197 (398,423) 3,774 - - - (3,774) - (3,774)Police 7,688,128 1,319,072 9,007,200 1,498,345 217,092 - (7,291,763) - (7,291,763)Streets and public works 2,248,933 (266,097) 1,982,836 636,020 2,721,256 1,991,935 3,366,375 - 3,366,375Culture and recreation 2,094,408 259,017 2,353,425 903,961 - - (1,449,464) - (1,449,464)Redevelopment 201,686 - 201,686 - - - (201,686) - (201,686)Other 123,252 21,177 144,429 - 179,150 - 34,721 - 34,721Capital outlay 12,215,438 62,593 12,278,031 - - 2,460,276 (9,817,755) - (9,817,755) Total governmental activities 26,908,944 (868,974) 26,039,970 3,557,945 3,117,498 4,488,868 (14,875,659) - (14,875,659) Business-type activities:
Water 1,917,858 328,710 2,246,568 4,050,611 - 321,894 - 2,125,937 2,125,937Sewer 1,024,173 175,689 1,199,862 1,868,015 - 598,729 - 1,266,882 1,266,882Refuse 2,124,326 364,575 2,488,901 2,645,036 - 15,948 - 172,083 172,083 Total business-type activities 5,066,357 868,974 5,935,331 8,563,662 - 936,571 - 3,564,902 3,564,902 Total primary government $ - 31,975,301 $ 31,975,301 $ 12,121,607 $ 3,117,498 $ 5,425,439 $ (14,875,659) 3,564,902 (11,310,757) General revenues:
Taxes:
Property taxes - 2,779,614 2,779,614
Sales and use taxes - 4,581,976 4,581,976
Other 214,883 259,023 473,906
Motor vehicle in lieu - 2,013,090 2,013,090
Investment income 49,676 2,421,810 2,471,486
Miscellaneous - 622,716 622,716
Transfers (2,896,788) 2,896,788 -
Total general revenues and transfers (2,632,229) 15,575,017 12,942,788 Change in net position 699,358 932,673 1,632,031Net position (deficit) - beginning 60,680,506 (4,466,971) 56,213,535Net position (deficit) - ending $ (3,534,298) 61,379,864 $ 57,845,566 $ Expenses Program Revenues Net (Expense) Revenue and Changes in Net Position 2024.06.30 RIPON Financial Statements
20 FUND FINANCIAL STATEMENTS
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Governmental Funds
Balance Sheet – Modified Cash Basis
The notes to the basic financial statements are an integral part of this statement. 21 Streets &
Roads Capital Non-Major Total
General Special Projects Special Revenue Governmental
Fund Revenue Fund Fund Funds Funds
ASSETS
Cash and investments $ 11,053,683 $ 4,673,483 $ 13,549,425 $ 6,449,333 $ 35,725,924 Cash and investments - restricted 4,923,601 21,064,288 - 25,987,889 - Due from other funds 12,720 - - - 12,720
Advance to other funds - restricted - 5,691,444 379,487 - 6,070,931 Total assets $ 21,681,448 4,673,483 $ 34,993,200 $ 6,449,333 $ 67,797,464 $
LIABILITIES
Due to other funds - $ - $ - $ 12,720 $ 12,720 $
Advances from other funds 130,023 - 5,691,444 - 5,821,467 Loan due to private-purpose trust funds - - 583,413 - 583,413 Total liabilities - 130,023 6,274,857 12,720 6,417,600
FUND BALANCES
Restricted for:
Public safety 197,505 - - - 197,505
Street construction and maintenance - - - 5,348,392 5,348,392 Assessment districts - - - 389,180 389,180
Transit - - - 711,761 711,761
Capital projects:
Culture and recreation - - 60,000 - 60,000
Special assessment districts - - 1,444,386 - 1,444,386
Sewer projects - - 3,043,881 - 3,043,881
Water projects - - 8,156,065 - 8,156,065
Refuse projects - - 1,127,211 - 1,127,211
Public facilities financing plan - - 7,103,359 - 7,103,359 Other - - 129,386 129,386
Mitigation fees 8,460,409 - - - 8,460,409
Low and moderate income housing 1,957,131 - - - 1,957,131 Committed to:
Street construction and maintenance - 4,673,483 - - 4,673,483 Capital projects:
General government - - 771,521 - 771,521
Culture and recreation - - 3,922,529 - 3,922,529
General capital projects - 2,960,005 - 2,960,005 -
Contingencies:
Sick leave 431,234 - - - 431,234
Retirement 1,681,847 - - 1,681,847 -
Healthcare 222,793 - - - 222,793
Liability self-insured retention 668,379 - - - 668,379
Litigation and natural disaster 550,378 - - - 550,378
Unassigned - 7,381,749 - (12,720) 7,369,029
Total fund balances 4,673,483 21,551,425 28,718,343 6,436,613 61,379,864 Total liabilities and fund balances $ 21,681,448 4,673,483 $ 34,993,200 $ 6,449,333 $ 67,797,464 $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Governmental Funds
Statement of Revenues, Expenditures and Changes in Fund Balances – Modified Cash Basis The notes to the basic financial statements are an integral part of this statement. 22 Streets &
Roads Capital Non-Major Total
General Special Projects Special Revenue Governmental
Fund Revenue Fund Fund Funds Funds
REVENUES
Taxes 9,858,801 $ - $ - $ 47,589 $ 9,906,390 $
Assessments - - - 411,661 411,661
Licenses, permits and fees 1,781,447 - 1,558,578 - 3,340,025 Investment income 732,652 67,538 1,703,541 148,083 2,651,814 Intergovernmental revenue 17,734 30,000 1,120,693 3,579,837 4,748,264 Charges for services 2,376,188 - - 1,908 2,378,096
Fines and forfeitures 101,917 - - - 101,917
Housing/loan program income 161,811 - - - 161,811
Contributions 15,301 - - - 15,301
Other 32,874 5,568 75,825 13,000 127,267
Total revenues 15,078,725 103,106 4,458,637 4,202,078 23,842,546
EXPENDITURES
General government:
Administration 1,934,902 - - - 1,934,902
Legislative 398,423 - - - 398,423
Public safety:
Police 7,688,128 - - - 7,688,128
Streets and public works:
Streets - 752,070 - 74,568 826,638
Planning 261,251 - - 5,000 266,251
Engineering 333,941 - - - 333,941
Building 411,360 - - - 411,360
Culture and recreation:
Library 81,540 - - - 81,540
Parks and recreation 1,926,606 - 33,385 - 1,959,991
Community Center 52,877 - - - 52,877
Community development - - - 25,059 25,059
Special assessment districts - - - 414,519 414,519
Redevelopment 196,872 - - - 196,872
Allocation to other department costs (1,115,716) 100,052 62,593 84,100 (868,971) Other 123,252 - - - 123,252
Capital outlay 6,251 351,043 11,837,899 - 12,195,193
Total expenditures 12,299,687 1,203,165 11,933,877 603,246 26,039,975 Excess (deficiency) of revenues over expenditures (1,100,059) 2,779,038 (7,475,240) 3,598,832 (2,197,429)
OTHER FINANCING SOURCES (USES)
Operating transfers in - 2,141,854 3,599,060 65,251 5,806,165 Operating transfers out - (767,524) - (2,141,853) (2,909,377) Total other financing sources (uses) (767,524) 2,141,854 3,599,060 (2,076,602) 2,896,788 Net change in fund balances 2,011,514 1,041,795 (3,876,180) 1,522,230 699,359 Fund balances - beginning 3,631,688 19,539,911 32,594,523 4,914,383 60,680,505 Fund balances - ending $ 21,551,425 4,673,483 $ 28,718,343 $ 6,436,613 $ 61,379,864 $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Proprietary Funds
Statement of Net Position – Modified Cash Basis
The notes to the basic financial statements are an integral part of this statement. 23 Sewer Water Refuse
Enterprise Enterprise Enterprise
Fund Fund Fund Total
ASSETS
Current assets:
Cash and investments 697,413 $ 925,929 $ 211,230 $ 1,834,572 $ Cash and investments - restricted 594 - - 594
Total assets 697,413 926,523 211,230 1,835,166
LIABILITIES
Current liabilities:
Current portion of bonds payable 185,000 590,000 - 775,000 Noncurrent liabilities:
Advance from capital projects fund 249,464 - - 249,464
Noncurrent portion of bonds payable 4,155,000 190,000 - 4,345,000 Total liabilities 375,000 4,994,464 - 5,369,464
NET POSITION
Capital related debt (375,000) (4,745,000) - (5,120,000) Restricted for debt service - 594 - 594
Unrestricted 676,465 697,413 211,230 1,585,108
Total net position (deficit) 322,413 $ (4,067,941) $ 211,230 $ (3,534,298) $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Proprietary Funds
Statement of Revenues, Expenses and Changes in Fund Net Position – Modified Cash Basis The notes to the basic financial statements are an integral part of this statement. 24 Sewer Water Refuse
Enterprise Enterprise Enterprise
Fund Fund Fund Total
Operating revenues:
Charges for services:
Sewer usage services 1,868,015 $ - $ - $ 1,868,015 $
Water revenue - 4,050,611 - 4,050,611
Refuse revenue - - 2,645,039 2,645,039
Total operating revenues 4,050,611 1,868,015 2,645,039 8,563,665 Operating expenses:
Salaries and wages 321,884 493,428 639,971 1,455,283
Employee benefits 185,206 297,491 403,174 885,871
Professional services 106,674 73,886 12,123 192,683
Repairs and maintenance 108,131 201,320 105,560 415,011 Gas and oil 23,189 20,672 119,516 163,377
Utilities 161,244 449,073 9,582 619,899
Supplies 7,538 12,175 10,196 29,909
Conference expenses 1,519 387 108 2,014
Communications 3,172 62,430 5,122 70,724
Membership, dues, books, etc. 65,446 46,075 2,274 113,795 Postage 8,900 12,450 8,900 30,250
Refuse disposal - - 753,358 753,358
Other 11,847 37,340 54,442 103,629
Allocation of other department costs 175,689 328,710 364,575 868,974 Total operating expenses 2,035,437 1,180,439 2,488,901 5,704,777 Operating income 687,576 2,015,174 156,138 2,858,888
Nonoperating revenues (expenses):
Contributions/developer fees 598,729 321,894 15,948 936,571 Assessments 214,882 - - 214,882
Interest revenue 18,320 25,808 5,548 49,676
Interest expense (19,425) (211,131) - (230,556)
Total nonoperating revenues (expenses) 136,571 812,506 21,496 970,573 Net income before transfers 2,151,745 1,500,082 177,634 3,829,461 Operating transfers out (1,325,082) (1,394,072) (177,634) (2,896,788) Change in net position 175,000 757,673 - 932,673
Net position (deficit) - beginning (4,825,614) 147,413 211,230 (4,466,971) Net position (deficit) - ending $ (4,067,941) 322,413 $ 211,230 $ (3,534,298) $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Fiduciary Funds – Private Purpose Trust Fund
Statement of Fiduciary Net Position – Modified Cash Basis The notes to the basic financial statements are an integral part of this statement. 25 Successor Agency
Private Purpose
Trust Fund
ASSETS
Cash and investments $ 4,821,137
Cash and investments - restricted 1,297,266
Loan due from capital projects fund 583,413
Total assets 6,701,816
LIABILITIES
Due to County of San Joaquin 1,297,266
Long-term liabilities:
Debt due in more than one year 19,331,391
Total liabilities 20,628,657
NET POSITION
Net position (deficit) held in trust for redevelopment
dissolution and other purposes (13,926,841) $
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Fiduciary Funds – Private Purpose Trust Fund
Statement of Changes in Fiduciary Net Position – Modified Cash Basis The notes to the basic financial statements are an integral part of this statement. 26 Successor Agency
Private Purpose
Trust Fund
ADDITIONS
Property taxes $ 867,704
Program income 680
Investment income 410,722
Total additions 1,279,106
DEDUCTIONS
General operating 256,839
Interest expense 660,300
Total deductions 917,139
Net increase (decrease) in fiduciary net position 361,967 Total net position (deficit) - beginning (14,288,808)
Total net position (deficit) - ending (13,926,841) $
2024.06.30 RIPON Financial Statements
27 NOTES TO THE BASIC FINANCIAL STATEMENTS
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
28 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the City of Ripon, California (the City) are presented on the modified cash basis of accounting.
The modified cash basis of accounting differs from accounting principles generally accepted in the United States of America (GAAP). Generally accepted accounting principles include all relevant Governmental Accounting Standards Board (GASB) pronouncements.
A. Financial Reporting Entity
The City was incorporated on November 27, 1945, under the general laws of the State of California. The City operates under a Council-Administrator form of government consisting of five elected council members including the Mayor and a city council appointed City Administrator. The City provides the following services as authorized by its charter: public safety, sanitation, water utility, street maintenance, community development, library, parks and recreation, and general administrative services.
B. Individual Component Unit Disclosures
There are no entities which meet the Governmental Accounting Standards Board (GASB) Statement No. 14, as amended by GASB Statement No. 39 and GASB Statement No. 61 criteria for discrete disclosure within these basic financial statements.
C. Basis of Presentation
The government-wide financial statements (i.e. Statement of Net Position and Statement of Activities) display information about the primary government (the City). These statements include the financial activities of the overall City government, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. These statements distinguish between the governmental and business-type activities of the City. Governmental activities generally are financed through taxes, intergovernmental revenues, and other non-exchange transactions. Business-type activities are financed in whole or in part by fees charged to external parties.
The Statement of Activities presents a comparison between direct and indirect expenses and program revenues for each segment of the business-type activities of the City and for each function of the City’s governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses are allocated to functions based on the relativity of direct expenses by department.
Program revenues include (a) charges paid by the recipients of goods or services offered by the programs, (b) grants and contributions that are restricted to meeting the operational needs of a particular program and (c) fees, grants and contributions that are restricted to financing the acquisition or construction of capital assets. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.
Fund financial statements of the reporting entity are organized into funds, each of which is considered to be a separate accounting entity. Each fund is accounted for by providing a separate set of self-balancing accounts that constitutes its assets, liabilities, fund equity, revenues, and expenditures/expenses. Funds are organized into three major categories:
governmental, proprietary and fiduciary. An emphasis is placed on major funds within the governmental and proprietary categories. A fund is considered major if it is the primary operating fund of the City or meets the following criteria:
Total assets, liabilities, revenues, or expenditures/expenses of that individual governmental or enterprise fund are at least 10 percent of the corresponding total for all funds of that category or type, and Total assets, liabilities, or expenditures/expenses of the individual governmental or enterprise fund are at least 5 percent of the corresponding total for all governmental and enterprise funds combined. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
29 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Basis of Presentation (Continued)
The funds of the financial reporting entity are described below.
Governmental Funds
The General Fund is the primary operating fund of the City and is always classified as a major fund. It is used to account for all activities except those legally or administratively required to be accounted for in other funds.
Special Revenue Funds are used to account for the proceeds of the specified revenue sources that are either legally restricted to expenditures for specified purposes or designated to finance particular functions or activities of the City. The reporting entity includes the following special revenue fund, which is reported as a major fund.
Streets and Road Fund – Accounts for revenues and expenditures for streets and roads related maintenance and construction.
Capital Projects Funds are used to account for resources restricted or designated for the acquisition or construction of specific capital projects or items. The reporting entity includes the following capital projects fund, of which is reported as a major fund.
Capital Projects Fund – Accounts for contributions and specific revenues and transfers from other City funds and expenditures for various capital projects as the City Council may designate.
Proprietary Funds
Enterprise Funds are used to account for business-like activities provided to the general public. These activities are financed primarily by user charges, and the measurement of financial activity focuses on net income measurement similar to the private sector. The reporting entity includes the following enterprise funds: water, sewer, and refuse funds; all of which qualify as major funds.
Sewer Fund – Accounts for activities associated with operating and maintaining the City’s sewer and surface drainage system. All activities necessary to provide such services are accounted for in this fund, including administration, operations, capital improvements, maintenance, financing and related debt service, and billing and collection.
Water Fund – Accounts for the provision of water services to residents of the City. All activities necessary to provide such services are accounted for in this fund, including administration, operations, capital improvements, maintenance, financing and related debt service, and billing and collection.
Refuse Fund – Accounts for the provision of refuse collection services to residents of the City. All activities necessary to provide such services are accounted for in this fund, including administration, operations, capital improvements, maintenance, financing and related debt service, and billing and collection.
Proprietary fund operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up essentially equal values. Non-operating revenues, such as subsidies and investment earnings, result from non-exchange transactions or ancillary activities. Contributions/developer fees are reported separately and represent capital contributions charged by the City. Operating expenses are those expenses essential to the primary operations of the fund. All other expenses are reported as non-operating expenses.
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
30 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Basis of Presentation (Continued)
Fiduciary Funds
Fiduciary Funds are established to serve as the custodian for assets held in a trustee or agency capacity for others and, therefore, cannot be used to support the City’s own programs. The reporting entity includes one private-purpose trust fund.
Successor Agency Trust Fund – Accounts for activities related to the servicing of debt of the former Redevelopment Agency.
Measurement Focus
In the Government-Wide Statement of Net Position and Statement of Activities, both governmental and business-like activities are presented using the economic resources measurement focus, within the limitations of the modified cash basis of accounting, as defined below.
In the fund financial statements, the “current financial resources” measurement focus or the “economic resources” measurement focus, as applied to the modified cash basis of accounting, is used as appropriate:
All governmental funds utilize a “current financial resources” measurement focus. Only current financial assets and liabilities are generally included on their balance sheets. The operating statements present sources and uses of available spendable financial resources during a given period. These funds use fund balance as their measure of available spendable financial resources at the end of the period.
The proprietary fund utilizes an “economic resources” measurement focus. The accounting objectives of this measurement focus are the determination of operating income, changes in net assets (or cost recovery), and financial position. All assets and liabilities (whether current or noncurrent, financial, or nonfinancial) associated with their activities are reported. Proprietary fund equity is classified as net position.
The fiduciary fund utilizes an “economic resources” measurement focus. The accounting objectives of this measurement focus are the determination of additions, deductions, changes in net position, and financial position.
All assets and liabilities (whether current or noncurrent, financial, or nonfinancial) associated with their activities are reported. Fiduciary fund equity is classified as net position.
Basis of Accounting
In the Government-Wide Statement of Net Position and Statement of Activities, and the fund financial statements, governmental and business-like activities are presented using a modified cash basis of accounting. This is a basis of accounting other than accounting principles generally accepted in the United States of America (GAAP) as established by the Governmental Accounting Standards Board (GASB). The basis of accounting involves modification to the cash basis of accounting to report in the Statement of Net Position cash transactions that result in an obligation that covers a period greater than the period in which the cash transaction occurred. Accordingly, long-term liabilities arising from cash transactions have been reported in the Statement of Net Position. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
31 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Basis of Presentation (Continued)
Basis of Accounting (Continued)
This modified cash basis of accounting differs from GAAP primarily because certain assets and their related revenues (such as accounts receivable and revenue for billed or provided services not yet collected, and other accrued revenue and receivables) and certain liabilities and their related expenses or expenditures (such as accounts payable and expenses for goods or services received but not yet paid, and other accrued expenses and liabilities) are not recorded in these financial statements, with the exception of long-term liabilities arising from cash transactions. In addition, other economic assets, deferred outflows, liabilities, and deferred inflows that do not arise from a cash transaction or event (such as donated assets and postemployment benefit obligations) are not reported, and the measurement of reported assets and liabilities does not involve adjustment to fair value. Lastly, the City does not recognize its investment in capital assets in its Statement of Net Position.
If the City utilized the basis of accounting recognized as generally accepted, the fund financial statements for governmental funds would use the modified accrual basis of accounting, while the fund financial statements for proprietary and fiduciary fund types would use the accrual basis of accounting. All government-wide financials would be presented on the accrual basis of accounting.
Cash and Investments
For the purpose of financial reporting, “cash and cash investments” includes all demand and savings accounts and certificates of deposit or short-term investments with an original maturity date of three months or less. This also includes deposits with the State of California Local Agency Investment Fund (LAIF) and trust account investments in open-ended mutual fund shares.
The City has adopted GASB statement No. 72, Fair Value Measurement and Application; investments are measured at fair value on a recurring basis, when required. Recurring fair value measurements are those that GASB Statement require or permit in the statement of net position at the end of each reporting period.
Restricted cash and investments includes proceeds from the 2012 refunding water revenue bonds and the 2006 water revenue bonds which are restricted for expansion of the wastewater treatment plant, upgrade of water facilities and for repayment of bonds. Additionally, proceeds from 2020 tax allocation refunding bonds are restricted for various capital projects and for payment of bonds. Restricted cash and investments also include proceeds from grants for which the funds have not been expended.
Long-term Debt
All long-term debt arising from cash basis transactions to be repaid from governmental and business-type resources is reported as liabilities in the government-wide financial statements.
Long-term debt arising from cash basis transactions of governmental funds is not reported as liabilities in the fund financial statements. The debt proceeds are reported as other financing sources and payment of principal and interest reported as expenditures. The accounting for proprietary funds is the same in the fund financial statements as the treatment in the government-wide financial statements.
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
32 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Basis of Presentation (Continued)
Equity Classification
Equity in the government-wide statements is classified as net position and displayed in three components:
Capital related debt – Consists of the outstanding balances of any bonds, mortgages, notes or other borrowings that are attributable to the acquisition, construction, or improvements of capital assets.
Restricted – Consists of restricted assets reduced by liabilities with restriction constraints placed on the use either by external groups such as creditors, grantors, contributors, or laws and regulations of other governments; or law through constitutional provisions or enabling legislation.
Unrestricted – Net amount of assets and liabilities that are not scheduled in the determination of net investment in capital assets on the restricted component of net position.
It is the City’s policy to first use restricted net resources prior to the use of unrestricted net resources when an expense is incurred for purposes for which both restricted and unrestricted net resources are available.
In the fund financial statements, fund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the City is bound to honor constraints on the specific purpose for which amounts in the funds can be spent. Fund balance is reported in five components: non-spendable, restricted, committed, assigned and unassigned.
Nonspendable – Amounts that cannot be spent because they are either not in spendable form or legally or contractually required to be maintained intact.
Restricted – Amounts constrained regarding the use from restrictions externally imposed by creditors, grantors, contributors, or laws or regulations of other governments or by restrictions imposed by law through constitutional provisions or enabling legislation.
Committed – Amounts constrained regarding use for specific purposes pursuant to requirements imposed by formal action of the City’s highest level of decision-making authority.
Assigned – Amounts constrained by the City’s intent to be used for specific purposes but are neither restricted nor committed. The authority of assigning fund balance is expressed by the City Council, City Administrator or their designee as established in the City’s Fund Balance Policy.
Unassigned – Amounts that have not been restricted, committed or assigned to specific purposes within the General Fund. The General Fund is the only fund that reports a positive unassigned fund balance amount. Other governmental funds besides the General Fund can only report a negative unassigned fund balance amount.
When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, then unrestricted resources (committed, assigned and unassigned) as they are needed. When unrestricted resources (committed, assigned and unassigned) are available for use, it is the City’s policy to use committed resources first, then assigned, and then unassigned as they are needed.
Proprietary fund equity is classified the same as in the government-wide financial statements. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
33 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Basis of Presentation (Continued)
Internal and Interfund Balances and Activities
In the process of aggregating the financial information for the government-wide Statement of Net Position and Statement of Activities, some amounts reported as interfund activity and balances in the fund financial statements have been eliminated or reclassified.
Interfund activity, if any, within and among the governmental, proprietary, and fiduciary fund categories is reported as follows in the fund financial statements:
Interfund loans and advances – Amounts provided with a requirement for repayment are reported as interfund receivables and payables.
Interfund services – Sales or purchases of goods and services between funds are reported as revenues and expenditures/expenses.
Interfund reimbursements – Repayments from funds responsible for certain expenditures/expenses to the funds that initially paid for them are not reported as reimbursements but as adjustments to expenditures/expenses in the respective funds.
Interfund transfers – Flow of assets from one fund to another where repayment is not expected are reported as transfers in and out.
Interfund activity and balances, if any, are eliminated or reclassified in the government-wide statements as follows:
Internal balances – Amounts reported in the fund financial statements as interfund receivables and payables are eliminated in the governmental and business-type activities columns of the Statement of Net Position, except for the net residual amounts due between governmental and business-type activities, which are reported as Internal Balances.
Internal activities – Amounts reported as interfund transfers in the fund financial statements are eliminated in the government-wide Statement of Activities except for the net amount of transfers between governmental and business-type activities. The effects of interfund services between funds, if any, are not eliminated in the Statement of Activities.
Minimum Fund Balance Policy
The City’s fiscal policy requires the City to maintain a General Fund reserve of 35% of the current year’s budgeted General Fund annual expenditures for cash flow purposes.
Use of Estimates
The preparation of financial statements in conformity with the modified cash basis of accounting described in Note 1 used by the City requires management to make estimates and assumptions that affect certain reported amounts and disclosures; accordingly, actual results could differ from those estimates. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
34 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Basis of Presentation (Continued)
Budgetary Accounting
The City does not adopt an appropriated budget and is not required to adopt such a budget by law. However, the City does adopt a non-appropriated budget annually which is approved by the City Council. The budget for all governmental and proprietary funds is on the cash basis of accounting.
Property Taxes
Property taxes in the State of California are administered for all local agencies at the county level, and consist of secured, unsecured, and utility tax rolls. The following is a summary of major policies and practices relating to property taxes:
Property valuations are established by the Assessor of the County of San Joaquin for the secured and unsecured property tax rolls; the utility property tax rolls are valued by the State Board of Equalization. Under the provisions of Article XIIIA of the State Constitution (Proposition 13 adopted by voters on June 6, 1978) properties are assessed at 100% of full value.
From this base of assessment, subsequent annual increases in valuation are limited to a maximum of 2%. However, increases to full value are allowed for property improvements or upon change in ownership. Personal property is excluded from these limitations and is subject to annual reappraisal.
Tax levies are limited to 1% of full value which results in a tax rate of $1.00 per $100 assessed valuation, under the provisions of Proposition 13. Tax rates for voter-approved indebtedness are excluded from this limitation.
Tax levy dates are attached annually on January 1 proceeding the fiscal year for which the taxes are levied. The fiscal year begins July 1 and ends June 30 of the following year. Taxes are levied on both real and unsecured personal property, as it exists at that time. Liens against real estate, as well as the tax on personal property, are not relieved by subsequent renewal or change in ownership.
Tax collections are the responsibility of the county tax collector. Taxes and assessments on secured and utility rolls, which constitute a lien against the property, may be paid in two installments. The first is due on November 1 of the fiscal year and is delinquent if not paid by December 10. The second is due on March 1 of the fiscal year and is delinquent if not paid by April 10. Unsecured personal property taxes do not constitute a lien against real property unless the taxes become delinquent. Payment must be made in one installment, which is delinquent if not paid by August 31 of the fiscal year.
Significant penalties are imposed by the county for late payments.
The County of San Joaquin levies bills and collects property taxes and special assessments for the City. Property taxes levied are recorded as revenue when received, in the fiscal year of the levy, due to the adoption of the “alternate method of property tax distribution”, known as the Teeter Plan, by the City of Ripon and the County of San Joaquin. The Teeter Plan authorizes the Auditor/Controller of the County of San Joaquin to allocate 100 percent of the secured property taxes billed, but not yet paid. The County of San Joaquin remits tax monies to the City in three installments as follows:
50 percent remitted in December
45 percent remitted in April
5 percent remitted in June
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
35 NOTE 2 – CASH AND INVESTMENTS
Cash and investments as of June 30, 2024 were classified in the accompanying financial statements as follows:
Statement of Net Position:
Governmental and proprietary funds:
Cash and investments 37,560,496 $
Cash and investments - restricted 25,988,483
Total governmental and proprietary funds 63,548,979
Fiduciary funds:
Cash and investments 4,821,137
Cash and investments - restricted 1,297,266
Total fiduciary funds 6,118,403
Total cash and investments 69,667,382 $
Cash and investments as of June 30, 2024 consisted of the following:
Cash on hand $ 1,300
Deposits with financial institutions 253,999
Investments 69,412,083
Total cash and investments 69,667,382 $
The City maintains a cash and investment pool that is available for use by all funds. Each fund type’s portion of this pool is displayed on the Statement of Net Position and Balance Sheet as “cash and investments”. California statutes authorize cities to invest idle or surplus funds in a variety of credit instruments as provided for in the California Government Code Section 53600.
The carrying amounts of the City’s cash deposits totaled $253,998 at June 30, 2024. Bank balances were $270,216, the total amount of which was insured and/or collateralized with securities held by the pledging financial institutions in the City’s name.
The Government Code and the City of Ripon Investment Policy allow investments in the following instruments:
Maximum Authorized Required
Maturity Limit % Rating
Local Agency Bonds 5 years None None
U.S. Treasury Bills, Notes or Bonds 5 years None None
State Registered Warrants, Notes or Bonds 5 years None None Notes and Bonds of Other Local California Agencies 5 years None None U.S. Agencies 5 years None None
Bankers Acceptances 180 days 40% None
Prime Commercial Paper 270 days 15% or 30% A1/P1
Negotiable Certificates of Deposit 5 years 30% None
Repurchase and Reverse Purchase Agreements 1 yr/92 days None/20% None Medium Term Corporate Notes 5 years 30% A
Money Market Mutual Funds 5 years 15% 2-AAA
Collateralized Bank Deposits 5 years None None
Mortgage Pass-Through Securities 5 years 20% AA
Local Agency Investment Fund (LAIF) N/A None None
County Pooled Investment Funds N/A None None
Supranational Obligations 5 years 30% AA
Funds Held Under the Terms of a Trust Indenture
Indenture or Other Contract * * *
* Such funds may be invested according to the provisions of those indentures or agreements.
Investment Type
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
36 NOTE 2 – CASH AND INVESTMENTS (Continued)
A. Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment.
Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of shorter term and longer-term investments and by timing cash flows from maturities as necessary to provide the cash flow and liquidity needed for operations.
Information about the sensitivity of the fair values of the City’s investments (including investments held by bond trustee) to market interest rate fluctuations is provided by the following table that shows the distribution of the City’s investments by maturity:
Total 12 Months
Cost Fair Value or Less
LAIF $ 382,501 $ 381,092 $ 381,092
CSJVRMA Pool 32,599,724 32,050,752 32,050,752
CAMP Term Investments 34,909,221 34,909,221 34,909,221
US Bank - Section 115 Trust 1,520,041 1,500,710 1,500,710 Held by Bond Trustees:
Money Market Funds 596 596 596
Total investments 69,412,083 $ 68,842,371 $ 68,842,371 $ Investment Type
B. Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment.
This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the minimum rating required by (where applicable) the California Government Code, the City’s investment policy, or debt agreements, and the actual rating as of fiscal year-end for each investment type.
Minimum
Fair Legal
Amount Value Rating Not Rated
LAIF $ 382,501 $ 381,092 N/A $ 381,092
CSJVRMA Pool 32,599,724 32,050,752 * N/A 32,050,752
CAMP Term Investments 34,909,221 34,909,221 ** N/A 34,909,221 US Bank - Section 115 Trust 1,520,041 1,500,710 N/A 1,500,710 Held by Bond Trustees:
Money Market Funds 596 596 N/A 596
Total investments 69,412,083 $ 68,842,371 $ N/A $ 68,842,371 * Average rating of portfolio AA/Aa1
** Average rating of portfolio AAAf
Investment Type
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
37 NOTE 2 – CASH AND INVESTMENTS (Continued)
C. Concentration of Credit Risk
The investment policy of the City contains limitations on the amount that can be invested in certain types of investments.
The City’s investments are concentrated in external investment pools which are not subject to investment limits.
Custodial credit risk for deposits is the risk that, in the event of failure of a depository financial institution, a government will not be able to recover its deposit or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of failure of the counterparty (e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the City’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial risk for deposits or investments, other than the following provisions for deposits. The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The market value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits.
As of June 30, 2024, none of the City’s deposits with financial institutions were in excess of federal depository insurance limits.
D. Investment in State Investment Pool
Although the City did not participate in any securities lending transactions or enter into any reverse repurchase agreements during the year, the City does have an investment in the California Local Agency Investment Fund (LAIF) with fair value in the amount of $381,092. The total amount invested by all public agencies in the LAIF is $21,974,159,649. The Local Investment Advisory Board (Board) has oversight responsibility for the LAIF. The Board consists of five members as designated by state statute. The value of the pool shares in the LAIF, which may be withdrawn, is determined on an amortized cost basis, which is different than the fair value of the City’s portion in the pool. Included in the LAIF’s Investment Portfolio are United States Treasury and federal agency securities, International Bank for Reconstruction and Development federal agency floating rate debentures, bank notes, certificates of deposit, commercial paper, corporate floaters and bonds, time deposits, and California Assembly Bill 55 and State of California General Fund loans. Participant’s equity in the LAIF is determined by the dollar amount at the participant’s deposits, adjusted for withdrawals and distributed investment income. Accordingly, LAIF is not an investment type that can be categorized in any particular level in the fair value hierarchy. The State Treasurer’s investment policy for the LAIF and separately issued financial statements for the LAIF are available at https://www.treasurer.ca.gov/pmia-laif/pmia/index.asp E. Central San Joaquin Valley Risk Management Authority Pool The City maintains an investment of $32,599,724 in the Central San Joaquin Valley Risk Management Authority (CSJVRMA) Pool as of June 30, 2024. The total amount invested by all participants in the pool is $160,930,228. The value of the pool shares which may be withdrawn is determined on an amortized cost basis, which is different than the fair value of the City’s portion in the pool. The fair value of the City’s share of the pool is determined monthly and is $32,050,752 as of June 30, 2024. As the investment in CSJVRMA is presented at amortized costs, they are not an investment type that can be categorized in any level in the fair value hierarchy. The pool is not registered with the Securities Exchange Commission; however, it is managed by a registered investment advisor. Participation in the pool is voluntary. The pool’s average maturity is 1.73 years, and the average rating is AA/Aa1. The pool consists of 48% Securities of U.S. Government Agencies, 26% U.S. Corporate Obligations and 26% other. The pool complies with the City’s investment policy. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
38 NOTE 2 – CASH AND INVESTMENTS (Continued)
F. US Bank – Section 115 Trust
The City maintains a total investment of $1,520,041 in the US Bank Section 115 trust (115 Trust). The investment in the 115 Trust consists of mutual funds, index funds, money market funds and cash holdings for which identical assets are not found within active markets. These investments have been classified as level 2 within the fair value hierarchy.
G. Investment in California Asset Management Program
The City maintains a total investment of $34,909,221 in the California Asset Management Program (CAMP) as of June 30, 2024. CAMP is a California Joint Powers Authority established in 1989 to provide California public agencies with professional investment services. The City’s investment in CAMP Term offerings include fixed-term, fixed rate of returns based on a pool of open-market securities, such as mutual funds, index funds, money market funds and cash holdings. As a result, these investments have been classified as level 2 within the fair value hierarchy.
NOTE 3 – INTERFUND TRANSACTIONS
A. Transfers Between Funds
Resources may be transferred from one City fund to another with Council approval. Transfers between funds during the year ended June 30, 2024 were as follows:
Transfers In Transfers Out
Major Governmental Funds:
General Fund $ 767,524 - $
Streets and Roads Special Revenue Fund 2,141,854 -
Capital Projects Fund 3,599,060 -
Major Proprietary Funds:
Sewer Enterprise 1,325,082 -
Water Enterprise 1,394,072 -
Refuse Enterprise 177,634 -
Non-Major Special Revenue Funds:
2103 Fund 147,315 -
2105 Fund - 98,128
2106 Fund 158,528 -
2107 Fund - -
2107.5 Fund - 4,073
SB1 Street & Road Tax Fund - 771
Measure K Fund 175,327 -
COG/LTF Fund 1,557,711 -
Dutch Meadows Fund 9,279 -
Country Woods Fund 10,418 -
Farmland Estates Fund 5,696 -
Main Street Landscape Fund 38,372 -
Alexandra Landscape Fund - 1,486
Ripon Lighting Fund - -
Total interfund transfers 5,806,165 $ 5,806,165 $
Fund
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
39 NOTE 3 – INTERFUND TRANSACTIONS (Continued)
A. Transfers Between Funds (Continued)
In general, the City uses interfund transfers to:
Transfer unrestricted revenues collected in the General Fund to help finance various programs and capital projects accounted for in other funds.
Transfer unrestricted revenues collected in the General Fund to help cover excess expenditures over revenues accounted for in other funds.
Fund operations (move revenues from the funds that collect them to the funds that statute or budget requires to expend them)
Fund interdepartmental cost reimbursement
Fund capital projects
The effect of the interfund activity has been eliminated from the government-wide financial statements.
B. Internal Balances
Advances To/From Other Funds
During the year ended June 30, 2014, the City Council passed a resolution authorizing the installation of water meters on all water customer connections known as the Water Meter Implementation Program. This resolution called for the recovery of costs related to the installation project over the period of ten years through an additional charge to customers known as a “Water Meter Surcharge” fee. To pay for the cost of the project, City Council authorized expenditures from the Capital Projects Fund with the understanding, and legal requirement, that the Water Enterprise Fund will reimburse the expenditures incurred by the Capital Projects Fund from the revenues received from the newly implement Water Meter Surcharge fee. The City anticipates collections from this revenue source to be approximately $193,000 in each fiscal year. During the year ended June 30, 2024 the Water Enterprise Fund collected approximately $192,669 in water meter surcharges which was subsequently paid back to the capital projects fund. As of June 30, 2024 the balance owed from the Water Enterprise Fund to the Capital Projects Fund was $249,464.
During the year ended June 30, 2020, City Council passed a resolution authorizing an agreement with a local business in which the City would pay for certain capital improvements to a City owned recreation facility which would then be rented by the business. These capital expenditures were paid for by the Capital Projects Fund on behalf of the General Fund with the expectation that these costs would be recovered over a ten-year period through rent proceeds received from the tenant. During the year ended June 30, 2024, the General Fund collected $116,648 in facilities rent which was subsequently paid back to the Capital Projects Fund. As of June 30, 2024 the balance owed from the General Fund to the Capital Projects fund was $130,023.
During the year ended June 30, 2023, the City Council passed a resolution authorizing an advance between the General Fund and the Capital Project Fund for the purposes of capital needs related to future planned capital projects (Corporation Yard Project). Total funds advanced from the General Fund to the Capital Project fund for this advance totaled $5,687,300 and accrue simple interest at a rate of 1%. The loan is expected to be repaid with eligible developer fees collected by the Capital Project Fund. During the year end June 30, 2024, the General Fund collected $60,912, which was paid back from the Capital Projects Fund. As of June 30, 2024 the total advance related to this agreement was $5,691,444.
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
40 NOTE 4 – LOAN DUE TO PRIVATE-PURPOSE TRUST FUND
In 2011, the City entered into a loan agreement between the Redevelopment Agency and the City of Ripon (City). The City shall repay the Redevelopment Agency, the principal sum of up to five million dollars ($5,000,000) and pay interest on the outstanding balance of said sum at the rate of 0.4625% (the LAIF rate as of December 2010) for the first year.
Thereafter, at the end of each calendar year, the interest rate may be reset according to the December LAIF rate (4.00% at December 2023). A minimum of fifty percent (50%) of all development impact (PFFP) paid in connection with building activity of the City for the same calendar year shall be applied towards the loan. Only after the interest accrued for that calendar year has been paid, shall the outstanding balance be reduced. The full payment of principal and interest outstanding was due as of February 1, 2016; however, the City has only partially repaid the total balance owed and continues to work with the Department of Finance to settle the liability.
As of February 1, 2012, the Redevelopment Agency was dissolved, and the assets and activities of the Redevelopment Agency were transferred to a private-purpose trust fund (Successor Agency Trust).
NOTE 5 – LONG-TERM DEBT
The City incurs long-term debt to finance projects or purchase assets which will have useful lives equal to or greater than the related debt.
In governmental fund types, debt discounts and issuance costs are recognized in the current period. Debt discounts and issuance costs incurred by proprietary fund types have also been recorded in the period incurred in accordance with the modified cash basis of accounting.
A. Current Year Transactions and Balances
The City’s debt issues and transactions are summarized below and discussed in further detail thereafter.
Original Balance Balance Current
Amount June 30, 2023 Additions Reductions June 30, 2024 Year Business-Type Activities
2011 Refunding Revenue
Bonds (Sewer) 2,195,000 $ 550,000 $ - $ 175,000 $ 375,000 $ 185,000 $ 2006 Revenue Bonds
(Water) 7,845,000 4,055,000 - 330,000 3,725,000 345,000 2012 Refunding Revenue
Bonds (Water) 3,350,000 1,255,000 - 235,000 1,020,000 245,000 Total 13,390,000 $ 5,860,000 $ - $ 740,000 $ 5,120,000 $ 775,000 $ B. Revenue Bonds
Enterprise fund long-term debt outstanding as of June 30, 2024 consisted of the following:
In 2011, the City entered into an Installment Purchase Agreement with Bank of America Leasing to refund the City’s portion of the California Statewide Communities Development Authority Water and Wastewater Revenue Bonds (Pooled Financing Program) Series 1999A. The original borrowing was $2,195,000. The bonds are secured by a pledge of net revenues of the Sewer Enterprise Fund. The Sewer Enterprise Fund is required to establish user fees and rates that will yield net revenues equal to at least 1.2 times the annual debt service. Principal payments are due annually on October 1.
Interest payments are payable semi-annually on April 1 and October 1. In the event the City fails to make prompt payment, the Trustee may declare the entire unpaid balance immediately due. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
41 NOTE 5 – LONG-TERM DEBT (Continued)
B. Revenue Bonds (Continued)
In August 2006, the City issued $7,845,000 California Statewide Communities Development Authority Water Revenue Bonds Series 2006C. The bonds are secured by a pledge of net revenues of the Water Enterprise Fund. The Water Enterprise Fund is required to establish user fees and rates that will yield net revenues equal to at least 1.2 times the annual debt service. Principal payments are due annually on October 1. Interest payments are payable semi-annually on April 1 and October 1. In the event the City fails to make prompt payment, the Trustee may declare the entire unpaid balance immediately due.
In September 2012, the City entered into an agreement with Union Bank, N.A. to refund the City’s portion of the California Statewide Community Development Authority Water and Wastewater Revenue Bonds (Pooled Financing Agreement) Series 2002A. The original borrowing was $3,350,000. The bonds are secured by a pledge of net revenues of the Water Enterprise Fund. The Water Enterprise Fund is required to establish user fees and rates that will yield net revenues equal to at least 1.2 times the annual debt service. Principal payments are due annually on October 1. Interest payments are payable semi-annually on April 1 and October 1. In the event the City fails to make prompt payment, the Trustee may declare the entire unpaid balance immediately due.
All debts recorded by the City have been evaluated and are neither direct financing nor direct borrowings, under GASB 88.
Debt Outstanding as of June 30, 2024 consisted of the following:
Interest Amounts
Rate Maturity Date Issued Outstanding
Business-Type Activities
Enterprise Fund Bonds
2011 Refunding Wastewater Revenue
Bonds (Sewer):
Term Bonds 4.20% October 1, 2025 2,195,000 $ 375,000 $
2006 Revenue Bonds (Water):
Term Bonds 4.50% October 1, 2027 2,120,000 1,775,000
Term Bonds 4.50% October 1, 2032 1,950,000 2,250,000
Subtotal 3,725,000 4,370,000
2012 Refunding Revenue Bonds (Water):
Serial Bonds 2.00%-3.375% October 1, 2027 3,350,000 1,020,000 Total 9,915,000 $ 5,120,000 $
Annual future debt service requirements are shown below for all long-term debt:
For the Years
Ending June 30 Principal Interest
2025 $ 775,000 $ 208,371
2026 800,000 177,390
2027 635,000 149,069
2028 660,000 123,497
2029 410,000 101,250
2030-2032 211,500 1,840,000
Total 5,120,000 $ 971,077 $
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
42 NOTE 6 – DEFICIT NET POSITION AND FUND BALANCES
A. Fund Balance and Net Position Deficits
Major Funds
The Water Enterprise Fund had a net position deficit of $4,067,941 at June 30, 2024. This deficit is due to debt financing and is expected to be offset in the future from the receipts of revenues from charges for services and construction permits and the repayment of said debt.
The Successor Agency Private Purpose Trust Fund had a net deficit of $13,926,841 at June 30, 2024. This deficit is due to 2020 Tax Allocation Refunding Bonds and is expected to be offset in the future from repayment of debt.
As of June 30, 2024, the government-wide business type activities had a deficit of $3,534,298. The deficit is due to capital related debt attributed to the 2006 and 2012 Water Bonds Payable.
NOTE 7 – EMPLOYEE RETIREMENT SYSTEMS
A. Defined Contribution Plan
The City provides pension benefits for all of its permanent full-time employees, who completed six consecutive months of employment, through the City of Ripon Money Purchase Thrift Pension Plan (the Contribution Plan), a defined contribution plan, with the exception of public safety officers. On April 4, 1990, the public safety officers elected to participate in the California Public Employees Retirement System. In a defined contribution plan, benefits depend solely on amounts contributed to the plan plus investment earnings. As of June 30, 2024, there were 81 plan members. The Contribution Plan provisions, and contribution requirements are established and may be amended by the City Council.
The City contributes 10% of the total compensation of all participants who agree to contribute 5% of their compensation to the plan. The City entered into a Memorandum of Understanding with the Union representing its employees which requires the City to “pick up” the 5% employee contribution. All such contributions are designated as employee contributions and are fully vested. The Contribution Plan also allows additional employee contributions up to 6.6% of annual compensation, and the City will match such contributions at a 50% rate up to 3.3% of the qualified employee’s annual compensation.
The trust agreement provides that each participant directs the investments held in his/her individual account.
Participants are immediately vested in their contributions plus actual earnings thereon. The City’s contributions for each employee and interest allocated to the employee’s account are fully vested after six years of continuous service. City contributions for, and interest forfeited by, employees who leave employment before six years of service are redistributed to all participants based on salary and vesting levels with the exception of the additional contributions up to
6.6% of annual compensation referenced above, which are immediately fully vested.
The City’s contributions were calculated using the base salary amount of $4,600,644 for employees participating in the City’s defined contribution plan. The total employee and employer contributions for the year ended June 30, 2024 were $473,829 and $581,964 respectively. The employee and employer contributions represented 10.30% and 12.65% of covered payroll, respectively.
The Contribution Plan’s investments are reported at fair value in the separately issued plan financial statements. The methods used to measure fair value may produce an amount that may not be indicative of net realizable value or reflective future fair values. Furthermore, although the Contribution Plan believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
43 NOTE 7 – EMPLOYEE RETIREMENT SYSTEMS (Continued)
A. Defined Contribution Plan (Continued)
The fair value measurement accounting literature 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 unadjusted quoted prices in active markets for identical assets and have the highest priority; Level 2 inputs are from other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly; and Level 3 inputs are unobservable and have the lowest priority. The Contribution Plan uses appropriate valuation techniques based on the available inputs to measure the fair value of its investments. When available, the Contribution Plan measures fair value using Level 1 inputs because they generally provide the most reliable evidence of fair value. Level 3 inputs were used only when Level 1 or Level 2 inputs were not available.
The following table sets forth, by level within the fair value hierarchy, the Plan’s investments at fair value as of June 30, 2024:
Level 1 Level 2 Level 3 Total
U.S. Government Securities $ 1,245,538 - $ $ 1,245,538 - $ Mutual Funds 12,244,587 - 12,244,587 -
Common and Preferred stock 1,241,281 - 1,241,281 -
Real Estate Investment Trusts - 73,318 - 73,318
Total 73,318 $ 14,731,406 $ - $ 14,804,724 $
Assets at Fair Value as of June 30, 2024
B. California Public Employees Retirement System
Plan Descriptions
All public safety officers are eligible to participate in the City’s Safety Employee Pension Plan (the Plan), a cost-sharing multiple employer defined benefit pension plan administered by the California Public Employees’ Retirement System (CalPERS). Benefit provisions under the plan are established by State statute and City resolution. CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.
Benefits Provided
CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full-time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit.
The cost-of-living adjustments for each plan are applied as specified by the Public Employees’ Retirement Law. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
44 NOTE 7 – EMPLOYEE RETIREMENT SYSTEMS (Continued)
B. California Public Employees Retirement System (Continued) Benefits Provided (Continued)
The Plans’ provisions and benefits in effect at June 30, 2024 are summarized as follows:
Prior to January 1, 2012 through On or after
Hire date January 1, 2012 December 31, 2012 January 1, 2013 Benefit formula 3% @ 50 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 50 - 55 50 - 57
Monthly benefits, as a % of eligible compensation 3.000% 2.400% to 3.000% 2.000% to 2.700% Required employee contribution rates 9.000% 9.000% 13.750% Required employer contribution rates 25.650% 22.830% 13.540% Safety
Contributions
Section 20814c of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. Funding contributions for both Plans are determined annually on an actuarial basis as of June 30 by CalPERS. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees.
For the year ended June 30, 2024, the contributions recognized as part of pension expense totaled $793,489.
NOTE 8 – DEFERRED COMPENSATION PLAN AND TRUST
The City offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The Plan, available to all City employees, permits them to defer a portion of their salary until future years. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency.
All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property, or rights (until paid or made available to the employee or other beneficiary) are solely the property and rights of the employees. Accordingly, the plan/trust assets have been excluded from the City’s reported assets.
NOTE 9 – RISK MANAGEMENT
The City is exposed to various risks of loss related to torts, errors and omissions and injuries to employees. The City participates in a pooled liability program for general liability and workers compensation through the Central San Joaquin Valley Risk Management Authority (the Authority). The pooled liability program is an insurance pool provided through the deposits of approximately 58 member cities. The Authority is not an insurance company and does not charge a premium for coverage. Audited financial statements are available from the Central San Joaquin Valley Risk Management Authority at 1750 Creekside Oaks Drive, Suite, 200, Sacramento, CA 95833. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
45 NOTE 9 – RISK MANAGEMENT (Continued)
A. General Liability
The liability coverage provided by the Authority is completely self-insured by its member cities and all losses and related costs are shared among the other member cities in the pool above the City’s retained limit of $50,000 for the fiscal year ended June 30, 2024. The Authority determines the amount of risk each member city brings to the pool and calculates a relative risk distribution factor. As part of the retrospective adjustment process, at the time the respective program year is closed, any surplus will be refunded to the City and net deficits will be billed to the City. The City financial statements are prepared on the modified cash basis of accounting and, accordingly, a liability for net fund deficits, if any, on open program years have not been recorded. Disbursements to the Authority for general liability coverage during the year ended June 30, 2024 were $476,425.
B. Workers’ Compensation
The workers’ compensation coverage is provided by the Authority through a pooling feature which requires the member cities to self-insure a portion of each claim. Sharing of the risk is accomplished by forming pooled layers above the member city’s retained limit of $50,000 for the fiscal year ended June 30, 2024. As part of the retrospective adjustment process, at the time the respective program year is closed any surplus will be refunded to the City and net deficits will be billed to the City. The Pooled Workers’ Compensation Program participates in Local Agency Workers’ Compensation Joint Powers Authority (LAWCX).
Members of LAWCX risk share the layer between $2,000,000 and $5,000,000 (most recent information). Effective July 1, 2003, LAWCX joined the California State Association of Counties Excess Insurance Authority (CSAC EIA), a joint powers authority comprised of a number of individual public entities and other joint power authorities. CSAC EIA provides coverage above $5,000,000. The City’s financial statements are prepared on the modified cash basis of accounting and, accordingly, a liability for net fund deficits, if any, on open program years have not been recorded. Disbursements to the Authority for workers’ compensation coverage during the year ended June 30, 2024 were $636,552.
NOTE 10 – CONTINGENCIES
A. Grant Program Involvement
In the normal course of operations, the City participates in various federal or state grant/loan programs from year to year.
The grant/loan programs are often subject to additional audits by agents of the granting or loaning agency, the purpose of which is to ensure compliance with the specific conditions of the grant or loan. Any liability or reimbursement that may arise as a result of these audits cannot be reasonably determined at this time, although it is believed the amount, if any, would not be material.
B. General Liability
The City is subject to litigation arising from the normal course of business. In the opinion of the City attorney there is no pending litigation which is likely to have a material adverse effect on the financial position of the City. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
46 NOTE 11 – REVENUE LIMITATIONS IMPOSED BY CALIFORNIA PROPOSITION 218 Proposition 218, which was approved by the voters in November 1996, regulates the City’s ability to impose, increase, and extend taxes, assessments and fees. Any new increased or extended taxes, assessments and fees subject to the provisions of Proposition 218 require voter approval before they can be implemented. Additionally, Proposition 218 provides that these taxes, assessments and fees are subject to the voter initiative process and may be rescinded in the future years by the voters.
NOTE 12 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X 26 (the Bill) that provides for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City of Ripon that previously had reported a redevelopment agency within the reporting entity of the City as a blended component unit.
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 governments. On January 17, 2012, the City Council elected to become the Successor Agency for the former redevelopment agency in accordance with the Bill as part of City Resolution Number 12-7.
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).
In future fiscal years, successor agencies will only be allocated 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 and all assets have been liquidated.
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.
After the date of dissolution, the assets and activities of the dissolved redevelopment agency are reported as fiduciary funds (private-purpose trust funds) in the financial statements of the City.
In addition, the former Ripon Redevelopment Agency transferred all housing rights, powers, assets, liabilities, duties and obligations to the Housing Authority of the County of San Joaquin by operation of law, on February 1, 2012. The Housing Authority has chosen not to take any action on this transfer because it does not believe it is obligated to accept the housing functions previously performed by the former Ripon Redevelopment Agency. The City’s position on this issue is not a position of settled law and there is uncertainty regarding this issue. It is reasonably possible that a legal determination may be made at a later date by an appropriate judicial authority that would resolve this issue. Currently the remaining housing assets and loan portfolios are currently administered by the City of Ripon until a final resolution is determined. The activity of the housing assets of the former Ripon Redevelopment Agency are also reported as Fiduciary Funds (private-purpose trust funds) in the financial statements of the City. 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
47 NOTE 12 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY (Continued) A. Long-Term Debt
The Successor Agency’s debt issues and transactions are summarized below and discussed in detail thereafter:
Original Balance Balance
Amount June 30, 2023 Additions Reductions June 30, 2024 Current Fiduciary Fund
Former Redevelopment
Agency of the City of Ripon
2020 Tax Allocation
Refunding Bonds 16,560,000 $ 16,560,000 $ - $ - $ 16,560,000 $ - $ Premiums 3,595,317 2,996,098 - 224,707 2,771,391 -
Total 20,155,317 $ 19,556,098 $ - $ 224,707 $ 19,331,391 $ - $ B. Tax Allocation Bonds
In 2020, the Successor Agency to the Former Redevelopment Agency of the City of Ripon issued Tax allocation Refunding Bonds in the amount of $16,560,000 to refund the 2003, 2005, and 2007 series Tax Allocation Bonds previously issued by the Former Redevelopment Agency. This was done to take advantage of lower interest rates and to save on future debt service payments. Total debt service payments were reduced by $3,339,938. As a result, the 2003, 2005, and 2007 series Tax Allocation Bonds are considered fully defeased as of June 30, 2020. The 2020 bonds mature beginning on November 1, 2025 through 2036 and include variable rates of interest from 3%-4%. Those bonds maturing on or before November 1, 2030 are not subject to optional redemption prior to maturity and those maturing after November 1, 2030 are subject to redemption at the option of the Successor Agency on any date on or after November 1, 2030. Payments on the bonds are due biannually on May 1 and November 1 beginning on May 1, 2021. There is a provision whereby if the Successor Agency is unable to make payment or does not comply with bond covenants the Trustee may and shall at the written direction of the Owners of not less than a majority in aggregate principal amount of bonds at that time outstanding, declare the principal of all bonds outstanding and the accrued interest thereon to be due and payable immediately. The 2020 Tax Allocation Refunding Bonds are secured by a pledge of Tax Revenues derived from the Project Area and moneys in certain funds held under the bond indenture.
Fiduciary Fund debt outstanding as of June 30, 2024 consisted of the following:
Interest Rate Maturity Date Amounts Issued Outstanding
Former Redevelopment
Agency of the City of Ripon
2020 Tax Allocation Bonds
Serial Bonds 3.00% Nov. 1, 2025 $ 210,000 $ 210,000
Term Bonds 4.00% Nov. 1, 2036 16,350,000 16,350,000
Total $ 16,560,000 16,560,000 $
Fiduciary Fund
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Notes to the Basic Financial Statements
48 NOTE 12 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY (Continued) B. Tax Allocation Bonds (Continued)
Annual debt service requirements are shown below for fiduciary fund long-term debt:
For the Years
Ending June 30 Principal Interest
2025 $ - $ 660,300
2026 210,000 657,150
2027 880,000 636,400
2028 1,340,000 592,000
2029 1,395,000 537,300
2030-2034 7,765,000 1,786,300
2035-2038 299,200 4,970,000
Total 16,560,000 $ 5,168,650 $
Fiduciary Activities
NOTE 13 – PUBLIC FACILITIES FINANCING PLAN
The City collects fees from various developers in accordance with its Public Facilities Financing Plan (PFFP) that is restricted to be used for fund infrastructure needed to support growth in the City. The PFFP fees are collected to fund specific facility types, which include transportation, water, wastewater, storm drain, parks and recreation, library, administration, police, and corporation yard facilities. Additional other non PFFP fees are collected, including garbage, mitigation and building permit fees, each of which is also restricted for specific purposes. Each of these funds, which are maintained in the City’s Capital Projects Fund, are required to be accounted for separately.
There are a number of PFFP funds with negative balances, which was a result of advancing certain infrastructure projects ahead of collecting the necessary funds. These negative balances, which were borrowed from other PFFP funds and restricted funds with positive balances, continue to be tracked and are charged with interest expense that are applied to the funds with positive balances.
During the most recent PFFP fee update, a consultant evaluated the funds with negative balances and determined that the fees, as currently established, allows the City to collect sufficient revenue from future development to reimburse the funds with negative balances within the timeframe of the remainder of the City’s General Plan.
The following includes the City’s PFFP fund balances for the year ended June 30, 2024:
Balance Balance
June 30, 2023 Revenue Expenditures Transfers June 30, 2024 Water $ 2,981,047 $ 327,450 $ (27,617) $ 3,280,880 - $
SSJID Connection Reserve 871,876 93,855 - 965,731 -
Garbage (755,442) 15,948 (19,021) (758,515) -
Wastewater 5,685,747 745,002 - 6,430,749 -
Storm Drainage 2,415,847 320,546 - 2,736,393 -
Transportation 1,843,788 1,089,743 (228,736) 2,704,795 - Regional Transportation Impact Fee 1,614,803 95,757 - 1,710,560 - Parks and Recreation 45,651 32,593 - 78,244 -
Police Station (1,193,034) 10,074 (30,185) (1,213,145) - City Hall (3,804,693) 20,516 (96,359) (3,880,536) -
Corporation Yard 1,575,548 262,829 (6,100,113) (60,912) (4,322,648) Library (615,199) 1,633 (15,583) - (629,149)
Total balances by facility type 10,665,939 $ 3,015,946 $ (6,517,614) $ (60,912) $ 7,103,359 $ Facility Type
2024.06.30 RIPON Financial Statements
49 SUPPLEMENTARY INFORMATION
2024.06.30 RIPON Financial Statements
50 NON-MAJOR SPECIAL REVENUE FUNDS
2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Non-Major Special Revenue Funds
Combining Balance Sheet – Modified Cash Basis
51 HUTA HUTA HUTA HUTA HUTA
2103 2105 2106 2107 2107.5
Fund Fund Fund Fund Fund
ASSETS
Cash and investments - $ - $ - $ 797,917 $ - $
Total assets - $ - $ - $ 797,917 $ - $
LIABILITIES
Due to other funds $ - - $ - $ - $ - $
Total liabilities - - - - -
FUND BALANCES
Restricted for:
Street construction and maintenance - - 797,917 - -
Assessment districts - - - - -
Transit - - - - -
Unassigned - - - - -
Total fund balances - - - 797,917 -
Total liabilities and fund balances - $ - $ - $ 797,917 $ - $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Non-Major Special Revenue Funds
Combining Balance Sheet – Modified Cash Basis (Continued) 52 SB1 Street &
Road Tax Measure K COG/LTF STA/BUS CDBG
Fund Fund Fund Fund Fund
ASSETS
Cash and investments 951,178 $ 3,550,736 $ 48,561 $ 711,761 $ - $ Total assets 951,178 $ 3,550,736 $ 48,561 $ 711,761 $ - $
LIABILITIES
Due to other funds - $ - $ - $ - $ 12,720 $
Total liabilities - - - - 12,720
FUND BALANCES
Restricted for:
Street construction and maintenance 951,178 3,550,736 48,561 - - Assessment districts - - - - -
Transit - - - 711,761 -
Unassigned - - - - (12,720)
Total fund balances 951,178 3,550,736 48,561 711,761 (12,720) Total liabilities and fund balances 951,178 $ 3,550,736 $ 48,561 $ 711,761 $ - $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Non-Major Special Revenue Funds
Combining Balance Sheet – Modified Cash Basis (Continued) 53 Dutch Country Farmland Jacob's Carolina's
Meadows Woods Estates Landing Landscape
Fund Fund Fund Fund Fund
ASSETS
Cash and investments - $ - $ - $ 20,358 $ 28,697 $
Total assets - $ - $ - $ 20,358 $ 28,697 $
LIABILITIES
Due to other funds - $ - $ - $ - $ - $
Total liabilities - - - - -
FUND BALANCES
Restricted for:
Street construction and maintenance - - - - -
Assessment districts - - - 20,358 28,697
Transit - - - - -
Unassigned - - - - -
Total fund balances - - - 20,358 28,697
Total liabilities and fund balances - $ - $ - $ 20,358 $ 28,697 $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Non-Major Special Revenue Funds
Combining Balance Sheet – Modified Cash Basis (Continued) 54 Boesch/
Kingery Main Street Vineyards Alexandra
Assessment Landscape Cornerstone I Landscape Landscape
Fund Fund Fund Fund Fund
ASSETS
Cash and investments 7,197 $ - $ 84,262 $ 162,067 $ - $ Total assets 7,197 $ - $ 84,262 $ 162,067 $ - $
LIABILITIES
Due to other funds - $ - $ - $ - $ - $
Total liabilities - - - - -
FUND BALANCES
Restricted for:
Street construction and maintenance - - - - -
Assessment districts 7,197 - 84,262 162,067 -
Transit - - - - -
Unassigned - - - - -
Total fund balances 7,197 - 84,262 162,067 -
Total liabilities and fund balances 7,197 $ - $ 84,262 $ 162,067 $ - $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | JUNE 30, 2024
Non-Major Special Revenue Funds
Combining Balance Sheet – Modified Cash Basis (Continued) 55 Total
Ripon Non-Major
Lighting Special Revenue
Fund Funds
ASSETS
Cash and investments 86,598 $ 6,449,333 $
Total assets 86,598 $ 6,449,333 $
LIABILITIES
Due to other funds - $ 12,720 $
Total liabilities - 12,720
FUND BALANCES
Restricted for:
Street construction and maintenance - 5,348,392
Assessment districts 86,598 389,180
Transit - 711,761
Unassigned - (12,720)
Total fund balances 86,598 6,436,613
Total liabilities and fund balances (deficit) 86,598 $ 6,449,333 $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Non-Major Special Revenue Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances – Modified Cash Basis 56 HUTA HUTA HUTA HUTA HUTA
2103 2105 2106 2107 2107.5
Fund Fund Fund Fund Fund
REVENUES
Taxes $ - $ - $ - $ - $ -
Assessments - - - - -
Investment income 2,631 1,753 2,833 14,254 73
Intergovernmental revenue 144,684 96,375 62,876 130,370 4,000 Charges for services - - - - -
Other - - - - -
Total revenues 147,315 98,128 65,709 144,624 4,073
EXPENDITURES
Streets and public works:
Streets - - - - -
Planning - - - - -
Community development - - - - -
Special assessment districts - - - - -
Allocation to other department costs - - - - -
Total expenditures - - - - -
Excess (deficiency) of revenues over expenditures 147,315 98,128 65,709 144,624 4,073
OTHER FINANCING SOURCES (USES)
Operating transfers in - - - - -
Operating transfers out (147,315) (98,128) (158,528) - (4,073) Total other financing sources (uses) (147,315) (98,128) (158,528) - (4,073) Net change in fund balances - - (92,819) 144,624 -
Fund balances (deficit) - beginning - - 92,819 653,293 - Fund balances (deficit) - ending - $ - $ - $ 797,917 $ - $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Non-Major Special Revenue Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances – Modified Cash Basis (Continued) 57 SB1 Streets &
Road Tax Measure K COG/LTF STA/BUS CDBG
Fund Fund Fund Fund Fund
REVENUES
Taxes $ - $ - $ - $ - $ -
Assessments - - - - -
Investment income 17,006 66,562 28,694 14,277 -
Intergovernmental revenue 402,937 392,869 1,567,493 760,894 17,339 Charges for services - - - 1,908 -
Other - - - - -
Total revenues 419,943 459,431 1,596,187 777,079 17,339
EXPENDITURES
Streets and public works:
Streets - - - 74,568 -
Planning - - - - 5,000
Community development - - - - 25,059
Special assessment districts - - - - -
Allocation to other department costs - - - 12,878 -
Total expenditures - - - 87,446 30,059
Excess (deficiency) of revenues over expenditures 419,943 459,431 1,596,187 689,633 (12,720)
OTHER FINANCING SOURCES (USES)
Operating transfers in - - - - -
Operating transfers out (771) (175,327) (1,557,711) - - Total other financing sources (uses) (771) (175,327) (1,557,711) - - Net change in fund balances 419,172 284,104 38,476 689,633 (12,720) Fund balances (deficit) - beginning 532,006 3,266,632 10,085 22,128 - Fund balances (deficit) - ending 951,178 $ 3,550,736 $ 48,561 $ 711,761 $ (12,720) $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Non-Major Special Revenue Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances – Modified Cash Basis (Continued) 58 Dutch Country Farmland Jacob's Carolina's
Meadows Woods Estates Landing Landscape
Fund Fund Fund Fund Fund
REVENUES
Taxes $ - $ - $ - $ - $ -
Assessments 4,541 7,810 3,348 5,701 14,500
Investment income - - - - -
Intergovernmental revenue - - - - -
Charges for services - - - - -
Other - - - - -
Total revenues 7,810 4,541 3,348 5,701 14,500
EXPENDITURES
Streets and public works:
Streets - - - - -
Planning - - - - -
Community development - - - - -
Special assessment districts 11,793 15,555 7,718 6,316 12,137 Allocation to other department costs 2,026 2,673 1,326 1,085 2,085 Total expenditures 13,819 18,228 9,044 7,401 14,222
Excess (deficiency) of revenues over expenditures (9,279) (10,418) (5,696) (1,700) 278
OTHER FINANCING SOURCES (USES)
Operating transfers in 9,279 10,418 5,696 - -
Operating transfers out - - - - -
Total other financing sources (uses) 9,279 10,418 5,696 - - Net change in fund balances - - - (1,700) 278
Fund balances (deficit) - beginning - - - 22,058 28,419 Fund balances (deficit) - ending - $ - $ - $ 20,358 $ 28,697 $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Non-Major Special Revenue Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances – Modified Cash Basis (Continued) 59 Boesch/
Kingery Main Street Vineyards Alexandra
Assessment Landscape Cornerstone I Landscape Landscape
Fund Fund Fund Fund Fund
REVENUES
Taxes $ - $ - $ - $ - $ -
Assessments 6,061 10,480 14,079 64,939 5,397
Investment income - - - - -
Intergovernmental revenue - - - - -
Charges for services - - - - -
Other - - - - -
Total revenues 10,480 6,061 14,079 64,939 5,397
EXPENDITURES
Streets and public works:
Streets - - - - -
Planning - - - - -
Community development - - - - -
Special assessment districts 12,497 41,689 12,810 38,680 5,874 Allocation to other department costs 2,147 7,163 2,201 6,646 1,009 Total expenditures 14,644 48,852 15,011 45,326 6,883
Excess (deficiency) of revenues over expenditures (8,583) (38,372) (932) 19,613 (1,486)
OTHER FINANCING SOURCES (USES)
Operating transfers in - 38,372 - - 1,486
Operating transfers out - - - - -
Total other financing sources (uses) 38,372 - - - 1,486 Net change in fund balances (8,583) - (932) 19,613 -
Fund balances (deficit) - beginning - 15,780 85,194 142,454 - Fund balances (deficit) - ending 7,197 $ - $ 84,262 $ 162,067 $ - $ 2024.06.30 RIPON Financial Statements
CITY OF RIPON, CALIFORNIA | FOR THE YEAR ENDED JUNE 30, 2024 Non-Major Special Revenue Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances – Modified Cash Basis (Continued) 60 Total
Ripon Non-Major
Lighting Special Revenue
Fund Funds
REVENUES
Taxes 47,589 $ 47,589 $
Assessments 274,805 411,661
Investment income - 148,083
Intergovernmental revenue - 3,579,837
Charges for services - 1,908
Other 13,000 13,000
Total revenues 335,394 4,202,078
EXPENDITURES
Streets and public works:
Streets - 74,568
Planning - 5,000
Community development - 25,059
Special assessment districts 249,450 414,519
Allocation to other department costs 42,861 84,100
Total expenditures 292,311 603,246
Excess (deficiency) of revenues over expenditures 43,083 3,598,832
OTHER FINANCING SOURCES (USES)
Operating transfers in - 65,251
Operating transfers out - (2,141,853)
Total other financing sources (uses) - (2,076,602)
Net change in fund balances 43,083 1,522,230
Fund balances (deficit) - beginning 4,914,383 43,515
Fund balances (deficit) - ending 86,598 $ 6,436,613 $
2024.06.30 RIPON Financial Statements
CITY OF RIPON | JUNE 30, 2024
Additional Information on the Successor Agency Trust Fund 61 The following information is presented to supplement the basic financial statements and provides additional information about the Successor Agency Trust Fund. The information includes: the Statement of Fiduciary Net Position and the Statement of Changes in Fiduciary Net Position in accordance with generally accepted accounting principles as of and for the year ended June 30, 2024. Accordingly, the fiduciary fund financial statements utilize the accrual basis of accounting.
For additional information on the Successor Agency Trust Fund, refer to the notes to the City’s basic financial statements.
STATEMENT OF FIDUCIARY NET POSITION
PRIVATE-PURPOSE TRUST FUND
JUNE 30, 2024
Successor Agency
Private Purpose
Trust Fund
ASSETS
Cash and investments 4,821,137 $
Cash and investments - restricted 1,297,266
Interest receivable 93,396
Prepaid bond insurance 105,313
Loan due from capital projects fund 583,413
Total assets 6,900,525
LIABILITIES
Interest payable 100,050
Due to County of San Joaquin 1,297,266
Long-term liabilities
Debt due in more than one year 19,331,391
Total liabilities 20,728,707
NET POSITION
Net position (deficit) held in trust for redevelopment
dissolution and other purposes (13,828,182) $
2024.06.30 RIPON Financial Statements
CITY OF RIPON | JUNE 30, 2024
Additional Information on the Successor Agency Trust Fund (Continued) 62 STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
PRIVATE-PURPOSE TRUST FUND
FOR THE YEAR ENDED JUNE 30, 2024
Successor Agency
Private Purpose
Trust Fund
ADDITIONS
Property taxes 867,704 $
Program income 680
Investment income 499,964
Total additions 1,368,348
DEDUCTIONS
General operating 256,839
Interest expense 668,838
Total deductions 925,677
Net increase (decrease) in fiduciary net position 442,671 Total net position - beginning (14,270,853)
Total net position - ending $ (13,828,182)
2024.06.30 RIPON Financial Statements