CITY OF RIVERSIDE, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR FISCAL YEAR ENDED JUNE 30, 2022
Prepared by the Finance Department
Edward Enriquez, Interim Assistant City Manager/Chief Financial Officer/Treasurer 3900 Main Street, Riverside, California 92522 (951) 826-5660 This report was printed on recycled stock
CITY OF RIVERSIDE
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2022
TABLE OF CONTENTS
Page
INTRODUCTORY SECTION
Letter of Transmittal................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................i GFOA Certificate of Achievement................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................viii Legislative and City Officials................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ix Organizational Chart................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ix
FINANCIAL SECTION
Independent Auditor's Report................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................1 Management's Discussion and Analysis................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................5 Basic Financial Statements:
Government-Wide Financial Statements:
Statement of Net Position................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................18 Statement of Activities................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................19 Fund Financial Statements:
Balance Sheet - Governmental Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................20 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................21 Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................22 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................23 Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - General Fund................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................24 Statement of Net Position - Proprietary Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................25 Statement of Revenues, Expenses, and Changes in Net Position - Proprietary Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................27 Statement of Cash Flows - Proprietary Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................28 Statement of Net Position - Fiduciary Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................30 Statement of Changes in Net Position - Fiduciary Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................31 Notes to Basic Financial Statements................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................32 Required Supplementary Information (Unaudited):
Schedule of Changes in Net Pension Liability and Related Ratios................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................81 Schedule of Pension Plan Contributions................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................83 Schedule of Changes in Total OPEB Liability and Related Ratios................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................84
CITY OF RIVERSIDE
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2022
TABLE OF CONTENTS
PAGE
Combining and Individual Fund Statements and Schedules:
Combining Balance Sheet - Non-Major Governmental Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................86 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances - Non-Major Governmental Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................88 Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual - Non-Major Special Revenue Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................90 Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual - Capital Project Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................93 Combining Statement of Net Position - Non-Major Enterprise Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................96 Combining Statement of Revenues, Expenses, and Changes in Net Position - Non-Major Enterprise Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................98 Combining Statement of Cash Flows - Non-Major Enterprise Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................99 Combining Statement of Net Position - Internal Service Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................102 Combining Statement of Revenues, Expenses, and Changes in Net Position - Internal Service Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................103 Combining Statement of Cash Flows - Internal Service Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................104 Balance Sheet - Combining General Fund Schedule................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................106 Statement of Revenues, Expenditures, and Changes in Fund Balances - Combining General Fund Schedule................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................107 Balance Sheet - Combining Capital Outlay Fund Schedule................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................108 Statement of Revenues, Expenditures, and Changes in Fund Balances - Combining Capital Outlay Fund Schedule................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................109
STATISTICAL SECTION
Net Position by Component................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................111 Changes in Net Position................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................112 Fund Balances - Governmental Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................114 Changes in Fund Balances - Governmental Funds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................115 Business-Type Activities - Electricity Revenues by Source................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................116 Governmental Activities - Tax Revenue by Source................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................117 Taxable Sales by Category................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................118
CITY OF RIVERSIDE
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2022
TABLE OF CONTENTS
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Assessed Value and Estimated Actual Value of Taxable Property................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................119 Direct and Overlapping Property Tax Rates................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................120 Principal Property Taxpayers................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................121 Property Taxes Levies and Collections................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................122 Electricity Sold by Type of Customer................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................123 Electricity Rates................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................124 Top 10 Electricity Customers................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................125 Ratios of Outstanding Debt by Type................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................126 Ratios of General Bonded Debt Outstanding................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................127 Direct and Overlapping Governmental Activities Debt................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................128 Legal Debt Margin Information................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................130 Pledged-Revenue Coverage................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................131 Demographic and Economic Statistics................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................132 Principal Employers................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................133 Full-Time Equivalent City Government Employees by Function................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................134 Operating Indicators by Function................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................135 Capital Asset Statistics by Function................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................136
January 26, 2023
To the Honorable Mayor, Members of the City Council and Citizens of the City of Riverside:
It is our pleasure to submit the Annual Comprehensive Financial Report (ACFR) of the City of Riverside (the City) for the fiscal year ended June 30, 2022.
This report consists of management’s representations concerning the finances of the City. Consequently, management assumes full responsibility for the completeness and reliability of all the information presented in this report. To provide a rational basis for making these representations, management has established a comprehensive internal control framework that is designed both to protect the City ’s assets from loss, theft, or misuse and to compile sufficient reliable information for the preparation of the City’s financial statements in conformity with accounting principles generally accepted in the United States of America. Because the cost of internal controls should not outweigh their benefits, internal controls have been designed to provide reasonable rather than absolute assurance that the financial statements will be free from material misstatement. As management, we assert that, to the best of our knowledge and belief, this financial report is complete and reliable in all material respects.
The City’s financial statements have been audited by Lance, Soll & Lunghard, LLP a firm of certified public accountants. The independent auditor concluded, based on the audit, that there was a reasonable basis for rendering an unmodified opinion on the City’s financial statements for the fiscal year ended June 30, 2022. The independent auditor’s report is presented as the first component of the financial section of this ACFR.
The independent audit of the financial statements of the City was part of the federally mandated “Single Audit” designed to meet the special needs of federal grantor agencies. The standards governing Single Audit engagements require the independent auditor to report not only o n the fair presentation of the financial statements, but also on internal controls and compliance with legal requirements, with emphasis on those involving the administration of federal awards/grants. These reports will become available in the City’s separately issued Single Audit Report.
Management has provided an overall analysis of the financial statements in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with this section. The City’s MD&A can be found immediately following the independent auditor’s report.
Profile of the City of Riverside
The City of Riverside, incorporated on October 11, 1883, is located in the western portion of Riverside County, about 60 miles east of Los Angeles. The City currently occupies a land area of 81.507 square miles.
The City operates under the council-manager form of government, with a seven-member council elected by ward for four-year overlapping terms. The mayor is elected at large for a four-year term and is the presiding officer of the Council but does not have a vote except in the case of a tie. The City Council is responsible, among other things, for passing ordinances, adopting the budget, appointing committees, and hiring the City Manager, City Attorney, and City Clerk. The City Manager is responsible for carrying out the policies and ordinances of the Council, for overseeing the day-to-day operations of the City, and for appointing the heads of various departments. The Council is elected on a non-partisan basis. i
The City p rovides a full range of services which include general government, public safety ( police, fire, disaster preparedness and building inspection), construction and maintenance of highways and streets, economic development, culture and recreation, electric, water, airport, refuse, sewer, and senior citizen/handicap transportation. In addition to general City a ctivities, the Council is financially a ccountable for the Riverside Housing Authority, Riverside Public Financing Authority, Riverside Municipal Improvements Corporation and the Successor Agency, which was formed to hold the assets of the former Redevelopment Agency; therefore, these entities are included as an integral part of the City’s financial statements. Additional information on these legally separate entities can be found in Note 1 in the Notes to Basic Financial Statements.
Budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America. Annual appropriated budgets are adopted for all departments within the general, special revenue, and capital project funds. Formal budgets are not employed for debt service funds because debt indenture provisions specify payments. The permanent fund is not budgeted.
Biennially, during the period December through February, department heads prepare estimates of required appropriations for the following two-year budget cycle. These estimates are compiled into a proposed operating budget that includes a summary o f proposed expenditures and financial resources and historical data for the preceding budget cycle. At least thirty-five days prior to the beginning of the fiscal y ear, City Manager provides the proposed budget, in writing, to the City Council for review. The operating budget is presented by the City Manager to the City Council for review. Following Council review, a public hearing is set to obtain citizen comments. The City C ouncil generally c onducts the public hearing and adopts the budget during one of its June meetings. The City Manager is legally authorized to transfer budgeted amounts between divisions and accounts within the same department and fund over the course of the fiscal year. Transfer of appropriations between departments or funds and increased appropriations must be authorized by the City Council.
Expenditures may not legally exceed budgeted appropriations within a fund. All appropriations shall lapse at the end of the fiscal y ear to the extent they have not been expended or lawfully encumbered, except for appropriations for capital projects which shall continue to their completion. For the general fund, this comparison is presented on page 24 as part of the basic financial statements for the governmental funds. For governmental funds other than the general fund, with appropriated annual budgets, this comparison is presented in the governmental fund subsection of this report, which begins on page 90.
Local economy: The City is located in Inland Southern California, which consists of Riverside and San Bernardino Counties (the “MSA”). The population of Inland Southern California, at approximately 4.6 million, is larger than 25 states. The City leads the Inland Southern California in most measures of economic power, including population, income, employment, bank deposits, assessed valuation, office space and college enrollment. The population of the City is 317,847 which places it as the 12th largest in California.
The City of Riverside saw a reduction in the unemployment rate from 5.6% as of September 2021 to 3.2% as of September 2022. The City 's unemployment rate remains lower than the State of California (3.7%), the County of Riverside (4%), and the United States (3.3%). The primary drivers for the increase in employment in the Riverside metro area nonfarm payrolls were from the trade, transportation, and utilities; leisure and hospitality; professional and business services; and education and health services industries, which saw increases from September 2021 to September 2022.
Consumer prices continue to increase at levels not seen in decades. The Riverside metro area saw an overall increase in the consumer price index of 8.4% as of September 2022 compared to a 8.2% overall increase in the United States city average. The Riverside metro area saw food prices soar 11.5% and energy prices rise 23.6% as of September 2022 compared with 11.2% and 19.8% for the United States city average, respectively. ii
In October 2022, Riverside home prices were up 0.9% compared to last year, selling for a median price of $570,000. However, homes are taking longer to sell and the volume of home sales has decreased. On average, homes in Riverside currently sell after 37 days on the market compared to 28 days last year, and only 203 homes were sold in October 2022, down from 309 last year, a decrease of 34.3%.
Goals and Vision: On October 20, 2020, Council approved the Envision Riverside 2025 Strategic Plan, which is comprised of two components:
1. City Council Strategic Policy, which sets forth the priorities and policy direction of the City Council to advance Riverside’s potential and to frame the work efforts over the next five years including Vision, Cross-Cutting Threads, Strategic Priorities, Indicators and Goals; and
2. Operational Workplan, which sets forth envisioned actions to be carried out by City staff to implement the City Council Strategic Policy, as well as related metrics to track the trendlines of progress toward achieving City Council priorities and includes the Actions and Performance Measures which will be evaluated and updated by the City Manager on an as-needed basis in conjunction with the City’s budget cycle.
Envision Riverside 2025 Strategic Plan Vision: Riverside is a city where every person is respected and cherished, where equity is essential to community well-being, where residents support one another, and where opportunities exist for all to prosper. In Riverside, everyone comes together to help the community, economy and environment reach their fullest potential for the public good.
Cross-Cutting Threads: Major themes that should be reflected in all our outcomes include Community Trust, Equity, Fiscal Responsibility, Innovation, and Sustainability and Resiliency.
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Strategic Priorities and Indicators
Arts, Culture and Recreation Indicators: Community Well-Being Indicators: Economic Opportunity Indicators:
Lifelong Learning Housing Supply and Attainability Workforce Development Shared Uses and Partnerships Public Safety Business Development and Success Arts and Cultural Opportunities Public Health Local Investment Access to Parks, Trails and Open Spaces Placemaking Regional Partnerships Programs and Amenities Homelessness Economic Mobility Household Resilience
Environmental Stewardship Indicators: High Performing Government Indicators:
Infrastructure, Mobility, and Connectivity
Indicators:
Water Quality, Supply, Efficiency and Reliability Community Centered Services Access to Transportation Choices Climate Resiliency, Carbon Footprint and Air Quality Adaptive Organization Infrastructure Quality and Reliability Usage, Condition and Quality of Public Lands Financial Health Outside Investment Local Food System Vitality Equity in Delivery of City Services Smart City Ecosystem Environmental Justice Civic Engagement Greening Facilities, Fleet and Systems Renewable Resource Usage and Waste Reduction City Team Engagement As the City i mplements Priority B ased Budgeting strategies, which will guide the budget development process for future fiscal years, the City C ouncil’s Strategic Priorities will play a critical role in helping the City make decisions on how to allocate resources.
Long-term financial planning: The City continues to recover from the COVID-19 pandemic. Sales tax has seen increases in fiscal years 2021 and 2022 following a decrease caused by the pandemic in fiscal year 2020. Service revenues have also seen increases as venues began to fully open throughout the City. However, the increase in revenues have been shadowed by high inflation and corresponding Federal Reserve interest rates hikes used as a tool to reduce the impact of rising prices.
The City proposed the fiscal year 2022-2024 Biennial Budget totals approximately $1.36 billion in fiscal year 2022/23 and $1.32 billion in fiscal year 2023/24, including the City's operating budget and planned capital projects. Two primary goals were established for the fiscal year 2022-2024 budget development cycle:
1. Leverage Priority Based Budgeting (PBB) to identify and reallocate funding to critical unfunded needs.
During budget development and departments' evaluation of their operational and financial needs, departments identified additional critical needs. Those needs were described through the lens of PBB, including relating the requests to existing programs and answering fundamental questions to assess the level of criticality of the need:
How is this a critical unfunded need?
What is the impact to operations should this budget request not be approved? How does this request benefit City stakeholders?
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2. Implement a financing strategy of planned contributions and withdrawals to/from the Section 115 Trust to smooth the annual fiscal impact of the combined CalPERS unfunded accrued liability (UAL) and 2020 Pension Obligation Bond payments.
Staff analyzed the unfunded accrued liability (UAL) payment schedule per the CalPERS actuarial report and the pension obligation bond (POB) payment schedule and determined a feasible amount and optimal series of Section 115 Trust contributions and withdrawls to smooth the fiscal impact of the pay ment obligationss.
The proposed smoothing will result in level payments of $37,925,000 annually for a period of 12 years, from fiscal year 2024/25 through fiscal year 2035/36.
The City Council approved a $10 million contribution to the Section 115 Trust from fiscal year 2020/21 excess reserves. Contributions totaling nearly $12 million are incorporated into the proposed fiscal year 2022-2024 Biennial Budget, with $11 million occurring in fiscal year 2023/24 made possible by the payoff of the 2004 Safety POB in fiscal year 2022/23. The combination of current reserves and the proposed contributions will build the Section 115 Trust Fund to a balance of approximately $40 million which is projected to be sufficient to smooth the volatile required liability payments over the course of 12 years. Contributions totaling $34.4 million over five years are included in the General Fund Five-Year Financial Plan. It is important to note that the required UAL contributions will vary based on actual CalPERS investment returns; Section 115 Trust contributions will help to smooth the fiscal impact of spikes in the required UAL payments in future years.
American Rescue Plan Act (ARPA): On March 11, 2021, President Biden passed the $1.9 trillion American Rescue Plan Act (ARPA) sending checks to families and offering small business support to drive up demand and counter the country’s high unemployment. The ARPA established the Coronavirus State Fiscal Recovery Fund and the Coronavirus Local Fiscal Recovery Fund, which provide a combined $350 billion in assistance to eligible state, local, territorial, and Tribal governments to assist in the recovery from economic and health impacts of the COVID-19 pandemic by providing resources to address impacts resulting from the crisis. The City received one-time funding of approximately $73.5 million from ARPA with the first installment of $36.7 million received in June 2021 and $36.8 million received in June 2022. The City may use the funds to best support the needs of the community providing the use of the funds aligns with one of the following four statutory categories:
1. To respond to the COVID-19 public health emergency or its negative economic impacts;
2. To respond to workers performing essential work during COVID-19 public health emergency by providing premium pay to eligible workers of the recipient that are performing such essential work, or by providing grants to eligible employers that have eligible workers who perform essential work;
3. For the provision of government services, to the extent of the reduction in the revenue of such recipients due to the COVID-19 public health emergency , relative to revenues collected in the most recent full fiscal year of the recipient prior to the emergency; or
4. To make necessary investments in water, sewer, or broadband infrastructure. v
On November 9, 2021, the City Council approved the ARPA funding Expenditure Category Plan for the first allocation in the amount of $36.7 million following the Interim Final Rule guidelines. The approval by Council for the ARPA funding Expenditure Category Plan for the second allocation of $36.7 million is in progress.
1. Public Health $ 1,086,250 %2.95
2. Negative Economic Impacts 12,270,000 33.37
3. Services to Disproportionately Impacted Communities 13,120,000 35.68
4. Premium Pay - -
5. Infrastructure 2,500,000 6.80
6. Revenue Replacement 7,525,000 20.47
7. Administration 266,344 0.72
Total $ 36,767,594 %100.00
The Final Rule was issued on January 6, 2022 and became effective on April 1, 2022. Some key changes include:
The final rule offers a standard allowance for revenue loss of $10 million, allowing recipients to select between a standard amount of revenue loss or complete a full revenue loss calculation
In some cases, enumerated eligible uses included in the interim f inal rule under responding to the public health emergency h ave been re- categorized in the organization of the final rule to enhance clarity In addition to programs and services, the final rule clarifies that recipients can use funds for capital expenditures that support an eligible COVID- 19 public health or economic response
The final rule provides an expanded set of households and communities that are presumed to be “impacted” and “disproportionately impacted” by the pandemic, thereby allowing recipients to provide responses to a broad set of households and entities without requiring additional analysis The final rule provides a broader set of uses available for these communities as part of COVID-19 public health and economic response in all impacted communities and making certain community d evelopment and neighborhood revitalization activities eligible for disproportionately impacted communities
The final rule also allows for a broader set of uses to restore and support government employment, including hiring above a recipient’s pre- pandemic baseline, providing funds to employees that experienced pay cuts or furloughs, avoiding layoffs, and providing retention incentives.
Awards and Acknowledgements
The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting (Program) to the City for its annual comprehensive financial report (ACFR) for the fiscal year ended June 30, 2021. This was the sixteenth consecutive year that the City has received this prestigious award. The City received this award for publishing an easily readable and efficiently organized ACFR that satisfied both Generally Accepted Accounting Principles (GAAP) and applicable legal requirements. This award is valid for a period of one year only. We b elieve that our current ACFR continues to meet the Program’s requirements and we are submitting it to the GFOA again this year.
The Government Finance Officers Association (GFOA) has given an Award for Outstanding Achievement in Popular Annual Financial Reporting to the City vi
for its Popular Annual Financial Report (PAFR) for the fiscal year ended June 30, 2021. The City received the award for the fifth time for the June 30, 2021 report and has continued to prepare an award-winning report. This is a prestigious national award recognizing conformance with the highest standards for preparation of state and local government popular reports. The Award is valid for a period of one year only. We believe that our current PAFR continues to meet the Program's requirements and we are submitting it to the GFOA again this year.
The City received the GFOA’s Distinguished Budget Presentation Award for its annual budget document for the fiscal year beginning July 1, 2021. In order to receive this award, a governmental unit must publish a budget document that meets program criteria as a policy document, as an operations guide, as a financial plan, and as a communication device.
The preparation of this report would not have been possible without the efficient and dedicated services of the entire staff of the Finance Department and oversight from the City Manager’s Office. We would like to express our appreciation to all members of the department who assisted and contributed to its preparation. Credit also must be given to the Budget Engagement Commission and the Mayor and City Council for their unfailing support for maintaining the highest standards of professionalism in the management of the City’s finances.
Respectfully submitted,
Edward Enriquez
Chief Financial Officer/City Treasurer
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The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of
Achievement for Excellence in Financial Reporting to the City of Riverside for our Annual Comprehensive Financial Report for the fiscal year ended June 30, 2021.
In order to be awarded a Certificate of Achievement, a
governmental unit must publish an easily readable and efficiently organized Annual Comprehensive Financial Report, whose
contents conform to program standards. Such reports must satisfy both generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe our current report continues to meet the Certificate of Achievement Program requirements, and we are submitting it to GFOA to determine its eligibility for another certificate.
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LEGISLATIVE OFFICIALS
Patricia Lock Dawson ......................................................................Mayor Erin Edwards ....................................................Councilmember – Ward 1 Clarissa Cervantes ...........................................Councilmember – Ward 2 Ronaldo Fierro ..................................................Councilmember – Ward 3 Chuck Conder ...................................................Councilmember – Ward 4 Gaby Plascencia ...............................................Councilmember – Ward 5 Jim Perry ...........................................................Councilmember – Ward 6 Steve Hemenway ..............................................Councilmember – Ward 7
CITY OFFICIALS
Michael D. Moore.....................................................Interim City Manager* Rafael Guzman......................................................Assistant City Manager Kris Martinez..........................................................Assistant City Manager Edward Enriquez ...................................... Interim Assistant City Manager Donesia Gause..........................................................................City Clerk* Phaedra Norton ....................................................................City Attorney* Todd Corbin ..........................................General Manager - Public Utilities Larry V. Gonzalez................................................................Chief of Police Carl Carey.........................................................General Services Director Erin Christmas ................................................................... Library Director Pamela Galera..................Parks, Recreation & Community Svcs Director Edward Enriquez .................................. Chief Financial Officer/Treasurer Rene Goldman ...............................................Human Resources Director George Khalil .......................................................Chief Innovation Officer Gilbert Hernandez ...................................................Public Works Director La Wayne Hearn.............................................................Interim Fire Chief Robyn Peterson..............................................................Museum Director Chris Christopoulos .................................Interim Community & Economic .................................................................................Development Director *Appointed by City Council
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INDEPENDENT AUDITORS’ REPORT
To the Honorable Mayor and Members of the City Council
City of Riverside, California
Report on the Financial Statements
Opinions
We have audited the accompanying financial statements of the go vernmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of City of Riverside, California, (the City) as of and for the year ended June 30, 2022, 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 financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Riversi de, California, as of June 30, 2022, and the respective changes in financial position and, where applicable, cash fl ows thereof and the budgetary co mparison for the general fund for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinions
We conducted our audit in accordance with auditing standards ge nerally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to m eet our other ethical responsib ilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to pro vide a basis for our audit opinions.
Emphasis of Matter
Change in Accounting Principle
As described in Note 1 to the financial statements, in the fisc al year ended June 30, 2022, the City adopted new accounting gu idance, GASB Statement No. 87, Leases. Our opinion is not modified with respect to this matter.
203 N. Brea Blvd., Suite 203
Brea,CA92821Lance, Soll & Lunghard, LLP Phone: 714.672.0022
1 To the Honorable Mayor and Members of the City Council City of Riverside, California
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
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 stateme nt date, including any currently known information that may raise substantial doubt shortly thereafter.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if, there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with GAAS and Government Auditing Standards, we:
Exercise professional judgment and maintain professional skept icism 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 au dit 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. 2 To the Honorable Mayor and Members of the City Council City of Riverside, California
We are required to communicate with those charged with governan ce 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.
Other Reporting Responsibilities
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis , the schedule of changes in net pension liability and related ratios, the schedu le of pension plan contributions, and the schedule of changes i n total OPEB liability and related ratios, as listed on the table of contents, be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial s tatements, is required by the Go vernmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial st atements in an appropriate opera tional, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with au diting standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s res ponses to our inquiries, the basic financial statements, and ot her knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that co llectively comprise the City’s basic financial statements. The combining and indi vidual fund financial stateme nts and schedules (supplementary information) 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 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 acc ounting and other records used to prepare the basic financial s tatements or to the basic financial statements themselves, and other additional pro cedures in accordance with auditi ng standards generally accepte d in the United States of America. In our opinion, the supplementary inf ormation is fairly stated, in all material respects in relation to the basic financial statements as a whole.
Other Information
Management is responsible for the other information included in the annual report. The other information comprises the introdu ctory section and statistical section but does not include the basic financial statements and our auditor’s report thereon. Our opinions on the financial statements does 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 financial statements, our r esponsibility is to read the other information and consider whether a material inconsistency exists between the other information and the fina ncial 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.
3 To the Honorable Mayor and Members of the City Council City of Riverside, California
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated January 26, 2023, 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.
Brea, California
January 26, 2023
4 Management's Discussion and Analysis
(Unaudited)
As management of the City, we offer this narrative overview and analysis of financial activities for the fiscal year ended June 30, 2022. We encourage readers to consider the information presented here in conjunction with additional information furnished in our letter of transmittal, which can be found on page i of this report.
All amounts, unless otherwise indicated, are expressed in thousands of dollars (0,000).
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the City’s basic financial statements, comprised of three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to basic financial statements. This report also contains certain supplementary information.
Government-wide financial statements The government-wide financial statements are designed to provide readers with a broad overview of the City’s finances, in a manner similar to a private-sector business.
The statement of net position presents information on all of the City’s assets, liabilities, and deferred inflows and outflows of resources, with the difference reported as net position. Over time, increases or decreases in the City ’s net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating.
The statement of activities presents information showing how the City’s net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave).
The government-wide financial statements distinguish functions of the City t hat are principally s upported by t axes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, public safety, highways and streets, and culture and recreation. The business-type activities of the City include Electric, Water, Sewer, Airport, Refuse, Transportation, Public Parking, and Civic Entertainment Funds.
The government-wide financial statements include the activities of the City and three blended component units, which consist of the Riverside Housing Authority, Riverside Public Financing Authority, and the Riverside Municipal Improvements Corporation. Although legally s eparate, these entities function for all practical purposes as departments of the City and therefore have been blended as part of the primary government. The Successor Agency to the Redevelopment Agency of the City of Riverside (Successor Agency) is also included as a fiduciary component unit since it would be misleading to exclude the Successor Agency due to the nature and significance of the relationship between the City and the Successor Agency. The activity of the Successor Agency is reported with the City’s fiduciary funds, which is not included in the government-wide statements since the resources of those funds are not available to support the City’s own programs.
Both the Governmental Activities and the Business-Type Activities are presented on the accrual basis of accounting, a basis of accounting that differs from the modified accrual basis of accounting used in presenting governmental fund financial statements. Note 1 of the Notes to Basic Financial Statements fully describe these bases of accounting. Proprietary funds, discussed below, also follow the accrual basis of accounting.
The government-wide financial statements can be found on pages 18 - 19 of this report.
Fund financial statements A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into three categories: governmental, proprietary, and fiduciary. 5 Governmental funds Governmental funds a re used to account for the same functions reported as governmental activities i n the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources as well as on balances of spendable resources available at the end of the fiscal year.
It is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. Reconciliations to facilitate this comparison are provided for both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances. The major reconciling items relate to capital assets and debt. In the Governmental Funds, acquisitions of capital assets are treated as “expenditures” because upon purchase of a capital assets, cash used for the acquisition is no longer available for other purposes.
The issuance of debt provides cash, which is now available for specified purposes. Accordingly, at the end of the fiscal year, the unrestricted fund balances of the Governmental Funds reflect spendable resources available for appropriation by t he City C ouncil. Spendable balances are not presented on the face of the government-wide financial statements.
The City maintains fifteen individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the General Fund, Capital Outlay Fund, and General Debt Service Fund which are major funds. Data from the other twelve governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these non-major governmental funds is provided in the form of combining statements and can be found on pages 86 - 94 in this report.
The City adopted an annual appropriated budget for its General Fund for the Year ended June 30, 2022. A budgetary comparison statement has been provided to demonstrate compliance with this budget.
The governmental fund financial statements can be found on pages 20 - 23 of this report.
Proprietary funds The City maintains two different types of proprietary funds, enterprise and internal service funds. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for Electric, Water, Sewer, Airport, Refuse, Transportation, Public Parking and Civic Entertainment services. Internal service funds are an accounting device used to accumulate and allocate costs internally among the City’s various functions. The City uses internal service funds to account for self-insured insurance programs, central stores and its fleet of vehicles. Because these services predominantly b enefit governmental rather than business-type functions, they h ave been included within governmental activities in the government-wide financial statements. Internal service funds are presented as proprietary funds because both enterprise and internal service funds follow the accrual basis of accounting.
Proprietary funds provide the same type of information as the government-wide financial statements (business-type activities), only in more detail. The proprietary fund financial statements provide separate information for the Electric, Water and Sewer operations, all of which are considered to be major funds of the City. The five remaining proprietary f unds noted above are combined into a single, aggregated presentation. All internal service funds are also combined into a single, aggregated presentation in the proprietary f und financial statements. Individual fund data for the non-major enterprise funds and the internal service funds is provided in the form of combining statements and can be found on pages 96 - 104 in this report.
The basic proprietary fund financial statements can be found on pages 25 - 29 of this report.
Fiduciary fund Fiduciary funds are used to account for situations where the City ’s role is purely custodial. Fiduciary funds are not reflected in the government-wide financial statement because the resources of those funds are not available to support the City’s own programs. The accounting used for fiduciary funds is much like that used for proprietary funds.
The fiduciary fund financial statements can be found on page 30 - 31 of this report. 6 Notes to Basic Financial Statements The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The Notes to Basic Financial Statements begin on page 32 of this report.
Governmental Accounting Standards Board No. 87, Lease (GASB 87) For the year ended June 30, 2022, the financial statements include the adoption of GASB Statement No. 87, Leases. The primary objective of this statement is to enhance the relevance and consistency of information about governments' leasing activities. This statement establishes a single model for lease accounting based on the principle that leases are financings of the right to use an underlying asset.
Under this statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources. For additional information, refer to Notes 1, 5, 6, and 27.
Government-wide Financial Analysis
The following table presents a summarization of the City’s assets, liabilities, deferred inflows and outflows, and net position for its governmental and business-type activities. As noted earlier, a government’s net position may serve over time as a useful indicator of its financial position. (in thousands)
Governmental
Activities
Business-Type
Activities Total
2022 2021 2022 2021 2022 2021
Assets:
Current and other assets $ 711,511 $ 503,107 $ 856,015 $ 724,367 $ 1,567,526 $ 1,227,474 Capital and leased assets, net 1,330,850 1,337,100 1,975,600 1,976,364 3,306,450 3,313,464 Total assets 2,042,361 1,840,207 2,831,615 2,700,731 4,873,976 4,540,938 Deferred Outflows of Resources 67,430 100,355 41,648 70,694 109,078 171,049 Liabilities:
Current liabilities 146,784 112,061 71,696 57,503 218,480 169,564 Long-term liabilities 664,444 854,428 1,480,313 1,610,535 2,144,757 2,464,963 Total liabilities 811,228 966,489 1,552,009 1,668,038 2,363,237 2,634,527 Deferred Inflows of Resources 204,023 5,745 176,142 4,549 380,165 10,294 Net Position
Net investment in capital assets 1,176,215 1,170,232 774,469 756,116 1,950,684 1,926,348 Restricted 199,456 164,809 85,666 78,885 285,122 243,694 Nonspendable 3,582 - - - 3,582 -
Unrestricted/(deficit) (284,713) (366,713) 284,977 263,837 264 (102,876) Total net position $ 1,094,540 $ 968,328 $ 1,145,112 $ 1,098,838 $ 2,239,652 $ 2,067,166 The City’s assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $2,239,652 a t June 30, 2022, an increase o f $172,486 from June 30, 2021.
The City’s net position reflects its investment in capital assets (i.e., land, buildings, machinery, equipment and infrastructure), net of any related debt that is still outstanding used to acquire those assets and net of unspent bond proceeds and cash held in bond reserve accounts. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. 7 An additional portion of the City’s net position 13% r epresents resources that are subject to external restrictions on how they m ay b e used. The remaining unrestricted net position may be used to meet the government’s ongoing obligations to citizens and creditors. Of this amount, $(284,713) net deficit is held by the governmental activities and $284,977 is held by the business-type activities.
Unrestricted net position in the amount of $264, a net position increase of 100% from prior year, is the change in resources available to fund City programs to citizens and debt obligations to creditors. The positive increase in unrestricted net position is primarily the result of the reporting of the City’s net pension asset, which was a liability i n prior year, in accordance with an accounting standard issued by t he Government Accounting Standards Board (GASB) that relates to pension activity; Statement No. 68, “Accounting and Financial Reporting for Pensions – an amendment of GASB Statement No. 27.” Governmental activities increased the City’s net position by $126,212 to $1,094,540 for the year ended June 30, 2022.
On the following page is a condensed summary of activities of the City’s governmental and business-type operations for the period ended June 30, 2022 with the prior fiscal year presented for comparative purposes. Also included in the following analysis are revenue and expense graphs to aid in understanding the results of the current year’s activities.
(Balance of page intentionally left blank)
8 (in thousands)
Governmental
Activities
Business-Type
Activities Total
2022 2021 2022 2021 2022 2021
Revenues:
Program revenues:
Charges for services $ 41,072 $ 34,106 $ 598,474 $ 555,267 $ 639,546 $ 589,373 Operating grants and contributions 50,378 64,405 5,866 3,976 56,244 68,381 Capital grants and contributions 38,508 28,284 20,527 12,273 59,035 40,557 General revenues:
Sales taxes 173,933 150,321 - - 173,933 150,321
Property taxes 79,790 71,986 - - 79,790 71,986
Other taxes and fees 47,183 41,905 - - 47,183 41,905
Intergovernmental, unrestricted 661 499 - - 661 499
Investment income (7,613) 4,969 (13,324) 681 (20,937) 5,650 Miscellaneous 3,880 5,988 12,639 11,986 16,519 17,974
Total revenues 427,792 402,463 624,182 584,183 1,051,974 986,646 Expenses:
General government 66,937 97,927 - - 66,937 97,927
Public safety 169,742 219,136 - - 169,742 219,136
Highways and streets 41,125 42,034 - - 41,125 42,034
Cultural and recreation 38,885 37,693 - - 38,885 37,693 Interest on long-term debt and fiscal
charges 19,806 19,083 - - 19,806 19,083
Electric - - 349,004 366,165 349,004 366,165
Water - - 69,303 71,738 69,303 71,738
Sewer - - 59,060 61,029 59,060 61,029
Airport - - 1,944 2,326 1,944 2,326
Refuse - - 28,449 28,428 28,449 28,428
Transportation - - 3,758 4,623 3,758 4,623
Public Parking - - 4,566 4,684 4,566 4,684
Civic Entertainment - - 21,804 11,885 21,804 11,885
Total expenses 336,495 415,873 537,888 550,878 874,383 966,751 Increase (decrease) in net position 91,297 (13,410) 86,294 33,305 177,591 19,895 Extraordinary items - - (5,748) - (5,748) -
Transfers, net 34,915 34,879 (34,915) (34,278) - 601
Changes in net position 126,212 21,469 45,631 (973) 171,843 20,496 Net Position:
Beginning of year, as previously stated 968,328 866,575 1,098,838 1,099,811 2,067,166 1,966,386 Prior period adjustment - 80,284 643 - 643 80,284
Beginning of year, as restated 968,328 946,859 1,099,481 1,099,811 2,067,809 2,046,670 End of year $ 1,094,540 $ 968,328 $ 1,145,112 $ 1,098,838 $ 2,239,652 $ 2,067,166 9 Governmental Activities - Total change in net position for governmental activities increased by $104.7 million while prior fiscal year increased by $21.5 million.
Key elements of this year’s activity in relation to the prior year are as follows:
Revenues:
While variances between years exist for the various revenue categories, the total net increase was approximately $25.3 m illion or 6%. Precipitated by a n infusion of federal stimulus funding and inflationary factors and is largely attributable to the increase to sales taxes of $23.6 million which was primarily from increased sales price of fuel and service stations; autos and transportation; general consumer goods; building and construction; and restaurants and hotels.
The increase of property taxes of $7,804 was mainly due to increased property values and sales. Program revenue groupings were updated in fiscal year 2022 and are the primary reason for the $14,027 decrease in operating grants and contributions and the $10,224 increase in capital grants and contributions.
Expenses:
While variances between years exist for the various expense functions, the total net decrease was approximately $79.4 million or 19%. This is primarily related to one time expenditures in fiscal year 2021 for the Parada II Litigation settlement of $24 million and various grant expenditures for the CARES grant, which were nonrecurring in fiscal year 2022, as well as a decrease to personnel related costs of $48 million resulting from the elimination of the prior y ear net pension liability and generation of a net pension asset in fiscal year 2022.
Program Revenues and Expenses - Governmental Activities - Fiscal Year Comparison 2022 vs. 2021 10 Revenues by Source - Governmental Activities - Fiscal Year Comparison 2022 vs. 2021 Business-Type Activities - Total net position for business-type activities increased by $46.3 million while prior fiscal year decreased by $973. Key elements of this year’s activity in relation to the prior year are as follows:
Charges for services slightly increased from prior year resulting in an increase of $43.2 million or 8%. Electric Fund charges for services increased by $21.8 million primarily due to the rate plan increases and decreased uncollectibles. The Civic Entertainment Fund charges for services increased by $10.5 million due to the reopening of various entertainment venues caused by the COVID-19 pandemic. 11 Overall expenses decreased b y $13.0 m illion or 2.4%. The Electric Fund, Water Fund and Sewer Fund had decreased operating expenses of $16.3 million, $2.2 million and 1.3 million, respectively, primarily due to reduction in personnel related costs resulting from the elimination of the prior year net pension liability and generation of a net pension asset in fiscal year 2022.
Revenues by Source - Business-Type Activities - Fiscal Year Comparison 12 Financial Analysis of the City's Funds
Governmental funds. The focus of the City’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources.
Such information is useful in assessing the City ’s financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year.
The following table summarizes the balance sheet of the City’s General Fund, Capital Outlay Fund, and Non-Major Governmental Funds. As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance related legal requirements. (in thousands)
General Fund Capital Outlay Fund
General Debt Service
Fund
Non-Major
Governmental Funds
Total
Governmental Funds
2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
Assets $ 280,565 $ 201,980 $ 57,636 $ 54,804 $ 13,231 $ 13,165 $ 201,206 $ 169,940 $ 552,638 $ 439,889 Liabilities $ 42,541 $ 38,774 $ 4,612 $ 3,674 $ 1,552 $ 1,873 $ 96,882 $ 67,553 $ 145,587 $ 111,874 Deferred inflows of resources 10,806 3,559 520 772 - - 49,832 47,556 61,158 51,887 Fund Balances
Nonspendable 2,087 1,870 - - - - 1,495 1,477 3,582 3,347 Restricted 30,715 10,697 52,504 50,358 11,679 11,292 54,212 53,354 149,110 125,701 Committed 82,801 62,400 - - - - - - 82,801 62,400
Assigned 41,707 24,890 - - - - - - 41,707 24,890
Unassigned 69,908 59,790 - - - - (1,215) - 68,693 59,790 Total fund balances 227,218 159,647 52,504 50,358 11,679 11,292 54,492 54,831 345,893 276,128 Total liabilities, deferred
inflows, and fund
balances $ 280,565 $ 201,980 $ 57,636 $ 54,804 $ 13,231 $ 13,165 $ 201,206 $ 169,940 $ 552,638 $ 439,889 As of the end of the current fiscal year, the City’s governmental funds reported combined ending fund balances of $345,893 an increase of $69,765 compared to the prior year. Additionally, 1% o f the fund balance $3,582 i s nonspendable, which comprises the portion of fund balance that cannot be spent due to form. $149,110 or 43% of fund balance is restricted, which represents the portion of fund balance that is subject to externally enforceable limitations by law, enabling legislation or limitations imposed by c reditors or grantors. Committed fund balance of $82,801 o r 24% o f the fund balance was set aside for economic contingencies. Committed for economic contingencies consists of 20% of the 2022-23 G eneral Fund adopted expenditure budget of $306 m illion or $61,000, $5,000 for General Fund – Measure Z, $10,801 for future capital projects, and $6,000 for balancing measures. $41,707 or 12% of fund balance is constrained by the City’s intent to utilize fund balance for specific purposes, which is reported within the fund balance classification assigned. The remainder of the fund balance $68,693 o r 20% i s unassigned, meaning it is available for spending at the City’s discretion. The City’s governmental funds reported combined total assets of $552,638 at June 30, 2022, an increase of $112,749 compared to the prior year. Liabilities and deferred inflows of resources amounted to $206,745, an increase of $42,984 from prior year.
The General Fund is the principal operating fund of the City. At the end of the current fiscal year, total fund balance equaled $227,218, in comparison to $159,647 in the prior year. The increased in fund balance is primarily due to increased sales and use tax as well as the decrease in grant expenditures. The Capital Outlay Fund is used to account for the acquisition or construction of major capital facilities. The total fund balance was $52,504, compared to $50,358 i n prior year. The increased was due to decreased c apital projects. The General Debt Service Fund accounts for the accumulation of resources and payment of long-term debt principal and interest. The total fund balance was $11,679, compared to $11,292 in prior year. The Non-Major Governmental Funds fund balance was $54,492, compared to $54,831 in prior year.
Proprietary funds. The City’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail. 13 Unrestricted net position of the Electric, Water and Sewer Funds at the end of the year amounted to $194,443, $17,675, and $74,034, respectively. The unrestricted net position for the Electric, Water and Sewer Funds in the prior year was $201,521, $6,220, and $63,285, respectively. The decrease in unrestricted net position of the Electric Fund $(7,078) was primarily attributable to a reduction of investment income due to a market value adjustment done at fiscal y ear end as prescribed by accounting standards. The increase in unrestricted net position of the Water Fund $11,455 was primarily attributable to positive operating results. The increase in unrestricted net position for the Sewer Fund $10,749 is primarily a result of increased charge for services and reduced personnel service costs.
General Fund Budgetary Highlights
Original
Budget
Final
Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Revenues $ 285,299 $ 308,880 $ 329,317 $ 20,437
Expenditures:
Current:
General government 19,669 30,867 8,197 22,670
Public safety 196,249 202,627 193,369 9,258
Highways and streets 21,854 22,763 17,935 4,828
Culture and recreation 35,270 35,043 30,882 4,161
Capital outlay 3,630 20,301 3,262 17,039
Debt service - - 771 (771)
Total expenditures 276,672 311,601 254,416 57,185
Excess/(deficiency) of revenues over/(under) expenditures 8,627 (2,721) 74,901 77,622 Other Financing Sources/(Uses): (7,393) (18,425) (7,330) 11,095 Net change in fund balance 1,234 (21,146) 67,571 88,717 Fund Balance:
Beginning of year, as previously stated 159,647 159,647 159,647 - End of year $ 160,881 $ 138,501 $ 227,218 $ 88,717
The primary reason for final budgeted revenues and expenditures increasing from the Original Budget is due to increased sales and use tax as well as increased Measure Z funding for encumbrance rollovers, carryover budgets and capital projects.
Actual amounts differed from the final fund budget are as follows:
Actual expenditures were less than final budgeted amounts by approximately $57.2 million. This is primarily associated with unspent appropriations for projects that were not completed during the year (which are carried over to the next fiscal year) as well as the cost saving efforts by City Departments.
Capital Assets and Debt Administration
Capital Assets - T he City’s investment in capital assets for governmental and business-type activities as of June 30, 2022 a mounted to $3,304,620 ( net of accumulated depreciation). This investment includes land, intangibles, buildings and improvements, machinery and equipment, park facilities, roads, highways, and bridges. The total decrease in the City’s net capital assets for the current fiscal year was $8,844; a decrease of $7,302 for governmental activities and a decrease 14 of $1,542 for business-type activities primarily caused by depreciation expense exceeding capital asset additions.
Major capital improvements during the current fiscal y ear included ongoing projects: Consisting primarily of roads of $22.5 million; Storm drains of $8.6 million; and the Youth Innovation Center of $7.1 million for governmental activities. $26.4 m illion in Electric Utility c apital improvements primarily r elated to transformer replacements, improvements to communications network, underground improvements, metering infrastructure, and major streetlight projects; $15.2 m illion in Water Utility projects primarily related to main replacements, system expansion, transmission pipelines, distribution facilities, and well projects; and The Cheech Marin Center of $11 million grant funded for business-type activities.
Additional information on the City’s capital assets can be found in Note 5 on page 47 of this report.
City of Riverside's Capital Assets
(net of depreciation)
(in thousands)
Governmental
Activities
Business-Type
Activities Total
2022 2021 2022 2021 2022 2021
Land $ 376,787 $ 376,616 $ 100,111 $ 100,111 $ 476,898 $ 476,727 Construction in progress 52,051 30,820 128,123 126,187 180,174 157,007 Buildings 106,726 111,601 465,740 473,476 572,466 585,077 Improvements other than buildings 103,649 107,316 1,216,016 1,213,090 1,319,665 1,320,406 Machinery and equipment 32,060 33,113 32,994 32,712 65,054 65,825 Intangibles - - 31,838 30,788 31,838 30,788
Infrastructure 658,525 677,634 - - 658,525 677,634
Total $ 1,329,798 $ 1,337,100 $ 1,974,822 $ 1,976,364 $ 3,304,620 $ 3,313,464 Right to Use Assets - The City's investment in right to use assets for governmental and business-type activities as of June 30, 2022 amounted to $1,830 (net of accumulated amortization). This investment includes right to use land, buildings and machinery and equipment, which were added due to the implementation of GASB issued Statement No. 87, Leases.
Additional information on the City’s right to usel assets can be found in Note 5 on page 47 of this report.
City of Riverside's Right to Use Assets
(net of amortization)
(in thousands)
Governmental
Activities
Business-Type
Activities Total
2022 2021 2022 2021 2022 2021
Land - right to use $ - $ - $ 238 $ - $ 238 $ -
Buildings - right to use 617 - 273 - 890 -
Machinery and equipment - right to use 435 - 267 - 702 - Total $ 1,052 $ - $ 778 $ - $ 1,830 $ -
15 Long-term debt. At the end of the current fiscal year, the City had total debt outstanding of $1,997,595 which includes bonded debt of $1,779,938.
City of Riverside's Long-Term Debt
(in thousands)
Governmental
Activities
Business-Type
Activities Total
2022 2021 2022 2021 2022 2021
Lease revenue bonds $ 68,855 $ 72,471 $ 6,625 $ 7,059 $ 75,480 $ 79,530 General obligation bonds 4,987 6,478 - - 4,987 6,478
Pension obligation bonds 338,264 352,824 110,718 116,227 448,982 469,051 Certificates of participation 85,477 90,215 25,912 27,213 111,389 117,428 Revenue bonds - - 1,139,100 1,176,605 1,139,100 1,176,605 Loans payable - 457 - - - 457
Notes payable - - 59,948 64,678 59,948 64,678
Contracts payable - - 933 1,067 933 1,067
Financed purchased 22,294 14,922 2,176 2,354 24,470 17,276 Compensated absences 29,994 30,901 11,855 12,005 41,849 42,906 Claims and judgments 78,790 76,603 - - 78,790 76,603
Landfill capping - - 9,820 10,419 9,820 10,419
Lease liability 1,060 - 787 - 1,847 -
Total $ 629,721 $ 644,871 $ 1,367,874 $ 1,417,627 $ 1,997,595 $ 2,062,498 The City’s total debt decrease by $64,903 or 3.2% during the current fiscal year. The net decrease is primarily related to payments on long-term debt.
The City’s Water Utility m aintains “AA+” and “AA+” ratings, from S&P Global Ratings and Fitch, respectively, for their revenue bonds, while the Electric Utility maintains “AA-” ratings from both rating agencies for fixed rate bonds. The City’s general obligation bond ratings from S&P Global Ratings and Fitch are “AA” and “AA,” respectively.
State statutes limit the amount of general obligation debt a governmental entity may issue to 15 percent of its total adjusted assessed valuation. The legal debt limit was $907,813 at June 30, 2022, which applies only to general obligation debt. At June 30, 2022, the City had $4,987 of general obligation debt, resulting in available legal debt capacity of $902,826.
Additional information on the City’s long-term debt can be found in Note 9 beginning on page 52 of this report.
Economic Factors and Next Year's Budget
Unemployment in the City of Riverside is 3.2% compared to 5.6% for the prior year as of September, 2022. Unemployment decreased mainly due to the end of COVID-19 shutdowns.
The largest impact to the City’s long-term financial stability relates to pension costs from CalPERS.
The cost increases are mainly due to investment losses by CalPERS during the Great Recession as well as demographic changes, which impacted all the California agencies’ retirement plans managed by CalPERS. Additional factors causing cost increases, which impact all or many agencies include:
16 Retroactive retirement benefit enhancements for City employees between 2001 and 2006. Long-term investment returns not meeting expectations. Increased contributions resulting from the CalPERS anticipated discount rate, or assumed rate of return, over the past 15 years. CalPERS expects retirees to live longer.
As of June 30, 2022, CalPERS reported a preliminary negative 6.1% net return on investment in the 12-month period, which is above the fiscal y ear total fund policy benchmark of negative 7.0%. This return was far below the prior year positive return of 21.3%.
Volatile global financial markets, geopolitical instability, domestic interest rate hikes, and inflation all have had an impact on public market returns. CalPERS’ investments in global public stocks returned negative 13.1%, while fixed income investments returned negative 14.5%. Public market investments make up roughly 79% of the CalPERS’ total fund. CalPERS’ private market investments fared much better, with private equity and real assets sectors returning 21.3% and 24.1%, respectively.
With CalPERS’ discount rate of 6.8% and this year’s preliminary return of negative 6.1%, the estimated overall funded status stands at 72%.
As of June 30, 2022, total fund annualized returns for the 5-year period stood at 6.7%, the 10-year period at 7.7%, the 20-year period at 6.9%, and the 30-year period at 7.7%.
CalPERS began to collect employer contributions toward the plan’s unfunded liability as dollar amounts instead of prior method of a contribution rate combined with the normal cost rate effective July 1, 2018. Additionally, in the fiscal year 2019-20, The City issued a pension obligation bond to help reduce future pension contributions. The following lists the required unfunded liability contribution component per plan for fiscal year 2022-23:
Miscellaneous Plan – Unfunded Liability Payment of $11,466 Safety Plan – Unfunded Liability Payment of $12,416
On June 21, 2022, the City Council adopted the City's Fiscal Year 2022-24 Biennial Budget comprised of $1.4 billion in funding for citywide operations including $163 million for capital projects for fiscal year 2022-23 and $1.3 billion in funding for citywide operations including $115 million for capital projects for fiscal year 2023-24.
The General Fund Budget for fiscal year 2022-23 and 2023-24 of approximately $306 million and $311 million, respectively, was adopted. The fiscal year 2022-23 budget represents an increase from the prior year of approximately 6.6%.
Request for information
This financial report is designed to provide a general overview of the City ’s finances for all those with an interest in the City’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Finance Department, 3900 Main Street City of Riverside, California 92522.
17 CITY OF RIVERSIDE
STATEMENT OF NET POSITION
JUNE 30, 2022
(amounts expressed in thousands)
Primary Government
Governmental
Activities
Business-Type
Activities Total
Assets:
Cash and investments $ 442,633 $ 443,553 $ 886,186
Receivables, net of allowance for uncollectible 114,146 87,877 202,023 Lease receivable 7,501 97,294 104,795
Inventory 8,197 3,684 11,881
Prepaid items 2,256 18,029 20,285
Deposits - 1,640 1,640
Other assets - 3,225 3,225
Internal balances (1,442) 1,442 -
Restricted assets:
Cash and cash equivalents - 77,945 77,945
Cash and investments with fiscal agent 40,083 58,456 98,539 Benefit/Conservation Programs receivable - 1,657 1,657
Regulatory assets - 13,324 13,324
Derivative instruments - 269 269
Land and improvements held for resale 3,010 - 3,010
Advances to Successor Agency Trust Fund - 2,454 2,454
Net pension asset 95,127 45,166 140,293
Capital assets, not depreciated 428,838 249,729 678,567 Capital assets, net of depreciation 900,960 1,725,093 2,626,053 Right to use assets, net of amortization 1,052 778 1,830 Total assets 2,042,361 2,831,615 4,873,976
Deferred Outflows of Resources:
Changes in derivative values 4,574 8,719 13,293
Deferred charge on refunding 2,094 13,720 15,814
Pension related items 54,258 15,793 70,051
OPEB related items 6,504 3,416 9,920
Total deferred outflows of resources 67,430 41,648 109,078 Liabilities:
Current liabilities:
Accounts payable and other current liabilities 46,558 35,269 81,827 Unearned revenue 86,911 8,709 95,620
Deposits 11,459 13,564 25,023
Accrued interest 1,856 14,154 16,010
Non-current liabilities:
Due within one year:
Long-term obligations 30,158 47,964 78,122
Compensated absences 16,600 8,402 25,002
Claims liability 15,304 - 15,304
Landfill capping - 559 559
Decommissioning liability - 8,813 8,813
Lease liability 443 223 666
Due in more than one year:
Long-term obligations 489,719 1,297,448 1,787,167
Compensated absences 13,394 3,453 16,847
Claims and judgments 63,486 - 63,486
Landfill capping - 9,261 9,261
Decommissioning liability - 44,497 44,497
Regulatory liability - 24,517 24,517
Derivative instruments 6,288 14,277 20,565
OPEB liability 28,435 20,335 48,770
Lease liability 617 564 1,181
Total liabilities 811,228 1,552,009 2,363,237
Deferred Inflows of Resources
Change in derivative values - 252 252
Deferred charges on refunding - 616 616
Pension related items 191,492 75,950 267,442
OPEB related items 4,807 2,652 7,459
Lease related items 7,724 96,672 104,396
Total deferred inflows of resources 204,023 176,142 380,165 Net Position:
Net investment in capital assets 1,176,215 774,469 1,950,684 Restricted:
Housing 43,749 - 43,749
Debt service 22,971 31,824 54,795
Public works 36,384 - 36,384
Capital projects 60,373 - 60,373
Landfill capping - 2,500 2,500
Programs and regulatory reguirements - 51,342 51,342
Economic development 16,556 - 16,556
Unfunded accrued liability 19,423 - 19,423
Nonspendable 3,582 - 3,582
Unrestricted/(deficit) (284,713) 284,977 264
Total net position $ 1,094,540 $ 1,145,112 $ 2,239,652
See Notes to Financial Statements
18 CITY OF RIVERSIDE
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Program Revenues Net (Expenses) Revenues and Changes in Net Position Primary Government
Expenses
Indirect Expenses
Allocation
Charges for
Services
Operating
Contributions
and Grants
Capital
Contributions
and Grants
Governmental
Activities
Business-Type
Activities Total
Function/Programs
Primary Government:
Governmental Activities:
General government $ 66,937 $ (18,804) $ 13,721 $ 39,006 $ 784 $ 5,378 $ - $ 5,378 Public safety 169,742 12,496 14,491 10,386 - (157,361) - (157,361) Highways and streets 41,125 3,175 6,090 745 36,406 (1,059) - (1,059) Culture and recreation 38,885 3,133 6,770 241 1,318 (33,689) - (33,689) Interest on long-term debt and fiscal charges 19,806 - - - - (19,806) - (19,806) Total governmental activities 336,495 - 41,072 50,378 38,508 (206,537) - (206,537) Business-Type Activities:
Electric 349,004 - 397,947 - 7,667 - 56,610 56,610
Water 69,303 - 80,535 - 5,693 - 16,925 16,925
Sewer 59,060 - 71,557 - 128 - 12,625 12,625
Airport 1,944 - 1,728 7 52 - (157) (157)
Refuse 28,449 - 29,768 - - - 1,319 1,319
Transportation 3,758 - 168 2,379 293 - (918) (918)
Public Parking 4,566 - 4,888 - - - 322 322
Civic Entertainment 21,804 - 11,883 3,480 6,694 - 253 253 Total business-type activities 537,888 - 598,474 5,866 20,527 - 86,979 86,979 Total primary government $ 874,383 $ - $ 639,546 $ 56,244 $ 59,035 $ (206,537) $ 86,979 $ (119,558) General Revenues:
Taxes:
Sales taxes 173,933 - 173,933
Property taxes 79,790 - 79,790
Utility users' taxes 32,464 - 32,464
Franchise taxes 5,955 - 5,955
Transient occupancy taxes 8,764 - 8,764
Intergovernmental, unrestricted 661 - 661
Investment income (7,613) (13,324) (20,937)
Miscellaneous 3,880 12,639 16,519
Transfers 34,915 (34,915) -
Extraordinary items - (5,748) (5,748)
Total general revenues, extraordinary items, and
transfers 332,749 (41,348) 291,401
Change in net position 126,212 45,631 171,843
Net Position:
Beginning of year, as previously stated 968,328 1,098,838 2,067,166 Prior period adjustments - 643 643
Beginning of year, as restated $ 968,328 $ 1,099,481 $ 2,067,809 End of year $ 1,094,540 $ 1,145,112 $ 2,239,652
See Notes to Financial Statements
19 CITY OF RIVERSIDE
BALANCE SHEET
GOVERNMENTAL FUNDS
JUNE 30, 2022
(amounts expressed in thousands)
General Fund
Capital Outlay
Fund
General Debt
Service Fund
Non-Major
Governmental
Funds
Total
Governmental
Funds
Assets:
Cash and investments $ 192,195 $ 52,355 $ 4,389 $ 136,492 $ 385,431 Cash and investments with fiscal agent 30,715 - 8,703 665 40,083 Receivables, net of allowance for uncollectible
Interest 401 111 4 223 739
Property taxes 1,544 - 42 98 1,684
Sales taxes 30,395 - - - 30,395
Utility billed 3,350 - - - 3,350
Accounts 7,063 451 - 121 7,635
Intergovernmental 4,444 4,700 - 14,966 24,110
Notes - - - 45,576 45,576
Lease receivable 7,501 - - - 7,501
Prepaid items 1,912 19 93 230 2,254
Due from other funds 870 - - - 870
Land and improvements held for resale 175 - - 2,835 3,010 Total assets $ 280,565 $ 57,636 $ 13,231 $ 201,206 $ 552,638 Liabilities, Deferred Inflows of Resources, and Fund
Balances:
Liabilities:
Accounts payable $ 9,494 $ 2,762 $ 110 $ 9,577 $ 21,943 Accrued payroll 21,433 - - 39 21,472
Retainage payable 2 348 - 1,025 1,375
Intergovernmental 153 - - 1 154
Unearned revenue - 1,502 - 85,409 86,911
Deposits 11,459 - - - 11,459
Due to other funds - - - 831 831
Advances from other funds - - 1,442 - 1,442
Total liabilities 42,541 4,612 1,552 96,882 145,587
Deferred Inflows of Resources:
Unavailable revenue 3,082 520 - 49,832 53,434
Lease related items 7,724 - - - 7,724
Total deferred inflows of resources 10,806 520 - 49,832 61,158 Fund Balances:
Nonspendable:
Inventories, prepaids, and deposits 1,912 - - - 1,912
Land and improvements held for resale 175 - - - 175
Permanent fund principal - - - 1,495 1,495
Restricted:
Housing and redevelopment - - - 12,292 12,292
Debt service 11,292 - 11,679 - 22,971
Transportation and public works - 52,504 - 34,569 87,073 Other purposes - - - 7,351 7,351
Unfunded accrued liability 19,423 - - - 19,423
Committed:
Economic contingency 66,000 - - - 66,000
Other purposes 16,801 - - - 16,801
Assigned:
General government 5,160 - - - 5,160
Public safety 12,319 - - - 12,319
Highways and streets 3,066 - - - 3,066
Culture and recreation 1,509 - - - 1,509
Continuing projects 19,653 - - - 19,653
Unassigned 69,908 - - (1,215) 68,693
Total fund balances 227,218 52,504 11,679 54,492 345,893 Total liabilities, deferred inflows of resources, and
fund balances $ 280,565 $ 57,636 $ 13,231 $ 201,206 $ 552,638 See Notes to Financial Statements
20 CITY OF RIVERSIDE
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF NET POSITION
JUNE 30, 2022
(amounts expressed in thousands)
Total fund balances - governmental funds $ 345,893
Amounts reported for governmental activities in the Statement of Net Position are different because:
Capital assets, net of accumulated depreciation, used in governmental activities are not current financial resources and, therefore, are not reported as assets in the governmental funds 1,322,679
Right to use asset, net of accumulated amortization, used in governmental activities and are not current financial resources and, therefore, are not reported as assets in the governmental funds 1,029 Net pension asset 92,895
Deferred outflows on refunding charges are not available resources and, therefore, are not reported on the funds 2,094 Deferred outflows on pension related items 53,478
Deferred outflows on OPEB related items 6,293
Deferred inflows on pension related items (187,739)
Deferred inflows on OPEB related items (4,656)
Revenue not available to pay for current period expenditures are reported as unavailable revenue in the governmental funds 53,434 Accrued interest payable for the current portion of interest due on various debt issues has not been reported in the governmental funds (1,856) Long-term liabilities, as listed below, are not due and payable in the current period and, therefore, are not reported in the governmental funds General obligation bonds (4,987)
Pension obligation bonds (333,690)
Certificates of participation (85,477)
Lease revenue bonds (68,855)
Financed purchase (22,294)
Compensated absences (29,537)
OPEB liability (27,228)
Lease liability (1,039) (573,107)
The City uses derivative instruments to hedge its exposure to changing interest rates through the uses of interest swaps. The following related items have been reflected in the Statement of Net Position:
Net fair value of interest rate swaps (6,288)
Deferred amount related to the hedgeable portion of derivative instrument 4,574 (1,714) Internal service funds are used by management to charge the costs of insurance, centralized purchasing and fleet management to individual funds. The assets and liabilities of the internal service funds are included in the governmental activities in the Statement of Net Position. (14,183) Net position of governmental activities $ 1,094,540
See Notes to Financial Statements
21 CITY OF RIVERSIDE
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
General Fund
Capital Outlay
Fund
General Debt
Service Fund
Non-Major
Governmental
Funds
Total
Governmental
Funds
Revenues:
Taxes $ 298,986 $ - $ 1,920 $ - $ 300,906
Licenses and permits 11,304 - - 3,546 14,850
Intergovernmental 4,463 13,830 - 69,707 88,000
Charges for services 15,311 - - 1,627 16,938
Fines and forfeitures 2,096 - - - 2,096
Special assessments 316 538 1,234 5,100 7,188
Rental and investment income (4,391) (1,437) (25) (680) (6,533) Miscellaneous 1,232 742 - 1,729 3,703
Total revenues 329,317 13,673 3,129 81,029 427,148
Expenditures:
Current:
General government 8,197 - - 16,132 24,329
Public safety 193,369 - - 12,599 205,968
Highways and streets 17,935 - - 870 18,805
Culture and recreation 30,882 - - 2,183 33,065
Capital outlay 3,262 20,130 - 48,142 71,534
Debt service:
Principal 675 - 27,389 62 28,126
Interest and fiscal charges 96 3 19,989 44 20,132
Total expenditures 254,416 20,133 47,378 80,032 401,959 Excess/(deficiency) of revenues
over/(under) expenditures 74,901 (6,460) (44,249) 997 25,189 Other Financing Sources/(Uses):
Transfers in 58,586 11,651 44,636 2,018 116,891
Transfers out (67,682) (3,045) (11,292) (3,361) (85,380) Issuance of long-term debt - - 11,292 - 11,292
Proceeds from sale of capital assets 53 - - 6 59
Proceeds from financing related to leases 1,713 - - 1 1,714 Total other financing sources/(uses) (7,330) 8,606 44,636 (1,336) 44,576 Net change in fund balances 67,571 2,146 387 (339) 69,765 Fund Balances:
Beginning of year 159,647 50,358 11,292 54,831 276,128
End of year $ 227,218 $ 52,504 $ 11,679 $ 54,492 $ 345,893 See Notes to Financial Statements
22 CITY OF RIVERSIDE
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Net change in fund balances - total governmental funds $ 69,765 Amounts reported for governmental activities in the Statement of Activities are different because:
Governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the costs of those assets is allocated over their estimated useful lives as depreciation and amortization expense.
Capital outlay $ 45,413
Depreciation expense (51,219)
Lease amortization expense (682)
Gain/(Loss) on sale of capital assets (670) (7,158)
Repayment of long-term debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the Statement of Net Position.
Whereas, issuance of long-term debt is a current financial resource in the governmental funds, but the issuance increase long-term debt in the Statement of Net Position. Also, governmental funds report the effect of premiums, discounts, and deferral on loss of refunding when the debt is first issued, whereas these amounts are deferred and amortized in the Statement of Activities
Issuance of long-term debt (13,003)
Principal repayments
General obligation bonds 1,475
Pension obligation bonds 14,370
Certificates of participation 4,675
Lease revenue bonds 3,248
Loan payable 457
Financed purchase 3,920
Leases 672
Amortization of bond premium/discount 356 16,170
The City uses derivative instruments to hedge its exposure to changing interest rates through the uses of interest swaps. The changes in the fair value of the interest swaps are only reflected on the Statement of Activities 296 Accrued interest for long-term liabilities. This is the net change in accrued interest for the current period 122 Compensated absences expenses reported in the Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds 842
Governmental funds report all contributions in relation to the annual required contribution (ARC) for the City retirement plan as expenditures; however, in the Statement of Activities only the ARC is an expense 46,943
Governmental funds report all contributions in relation to the annual required contribution (ARC) for OPEB as expenditures; however, in the Statement of Activities only the ARC is an expense (1,757)
Revenues reported as unavailable revenue in the governmental funds and recognized in the Statement of Activities. These are included in the intergovernmental revenues in the governmental fund activity 1,547
Internal service funds are used by management to charge the costs of insurance, central purchasing and fleet management to individual funds. The net revenues (expenses) of the internal service funds is reported with governmental activities (558) Change in net position of governmental activities $ 126,212 See Notes to Financial Statements
23 CITY OF RIVERSIDE
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES, IN FUND BALANCE - BUDGET AND ACTUAL
GENERAL FUND
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Budgeted Amounts Actual
Variance to
Final Budget
Positive
Original Final Amounts (Negative)
Revenues:
Taxes $ 252,040 $ 275,737 $ 298,986 $ 23,249
Licenses and permits 9,955 10,391 11,304 913
Intergovernmental 1,413 1,463 4,463 3,000
Charges for services 15,139 13,991 15,311 1,320
Fines and forfeitures 1,608 1,608 2,096 488
Special assessments 551 551 316 (235)
Rental and investment income 2,726 2,726 (4,391) (7,117) Miscellaneous 1,867 2,413 1,232 (1,181)
Total revenues 285,299 308,880 329,317 20,437
Expenditures:
General government:
Mayor 1,021 1,037 1,036 1
Council 1,709 1,707 1,632 75
Manager 7,737 10,630 5,536 5,094
Attorney 6,338 6,354 5,921 433
Clerk 2,258 2,266 1,950 316
Community development 16,825 24,954 13,913 11,041
Human resources 4,502 4,724 3,868 856
General services 6,818 6,977 6,210 767
Finance 11,681 10,423 8,880 1,543
Innovation and technology 14,395 15,419 12,884 2,535
Subtotal 73,284 84,491 61,830 22,661
Allocated expenditures - General Government (53,615) (53,624) (53,633) 9 Total general government 19,669 30,867 8,197 22,670
Public safety:
Police 124,772 128,093 119,573 8,520
Fire 64,488 67,018 67,196 (178)
Animal regulation 3,307 3,818 3,315 503
Building and zoning inspection 3,682 3,698 3,285 413
Total public safety 196,249 202,627 193,369 9,258
Highways and streets 21,854 22,763 17,935 4,828
Culture and recreation:
Library 8,282 8,578 7,399 1,179
Museum and cultural affairs 2,211 2,438 1,812 626
Parks, recreation and community services 24,777 24,027 21,671 2,356 Total culture and recreation 35,270 35,043 30,882 4,161 Capital outlay 3,630 20,301 3,262 17,039
Debt service:
Principal - - 675 (675)
Interest and fiscal charges - - 96 (96)
Total expenditures 276,672 311,601 254,416 57,185
Other Financing Sources/(Uses):
Transfers in 48,709 59,818 58,586 (1,232)
Transfers out (56,102) (78,243) (67,682) 10,561
Proceeds from sale of capital assets - - 53 53
Proceeds from financing related to leases - - 1,713 1,713 Total other financing sources/(uses) (7,393) (18,425) (7,330) 11,095 Net change in fund balance 1,234 (21,146) 67,571 88,717 Fund Balance:
Beginning of year, as previously stated 159,647 159,647 159,647 - Ending of year $ 160,881 $ 138,501 $ 227,218 $ 88,717
See Notes to Financial Statements
24 CITY OF RIVERSIDE
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
JUNE 30, 2022
(amounts expressed in thousands)
Business-Type Activities - Enterprise Funds Governmental Electric Water Sewer
Non-Major
Enterprise
Funds
Total
Enterprise
Funds
Activities -
Internal Service
Funds
Assets:
Current assets:
Cash and investments $ 274,172 $ 49,076 $ 108,145 $ 12,160 $ 443,553 $ 57,202 Receivables, net of allowance for
uncollectible
Interest 663 248 225 38 1,174 117
Utility billed 26,920 6,260 6,710 3,458 43,348 -
Utility unbilled 16,601 3,649 2,527 1,053 23,830 -
Accounts 6,542 1,476 1,502 2,816 12,336 125
Property taxes - - - 20 20 -
Intergovernmental 30 1,619 825 4,695 7,169 415
Lease receivable 990 425 30 940 2,385 -
Inventory 485 - 3,120 79 3,684 8,197
Prepaid items 5,446 199 29 38 5,712 2
Deposits 1,334 - - 306 1,640 -
Other current assets - 300 - - 300 -
Restricted assets:
Cash and cash equivalents
Rate stabilization cash and cash
equivalents - - 1,000 - 1,000 -
Other restricted cash and cash
equivalents 63,558 10,887 - 2,500 76,945 -
Benefit/Conservation Programs
receivable 1,485 172 - - 1,657 -
Total current assets 398,226 74,311 124,113 28,103 624,753 66,058 Noncurrent assets:
Restricted assets:
Cash and investments at fiscal agent 53,785 4,666 5 - 58,456 - Lease receivable 7,099 82,983 27 4,800 94,909 -
Prepaid items noncurrent 12,317 - - - 12,317 -
Other noncurrent assets - 2,925 - - 2,925 -
Advances to other funds - - 1,442 - 1,442 -
Regulatory assets 1,665 880 1,191 9,588 13,324 -
Derivative instruments - - - 269 269 -
Advances to Successor Agency Trust
Fund 2,454 - - - 2,454 -
Net pension asset 26,219 8,809 6,021 4,117 45,166 2,232 Capital assets, net of accumulated
depreciation 795,736 508,294 524,753 146,039 1,974,822 7,119 Right to use assets, net of amortization 491 16 16 255 778 23 Total noncurrent assets 899,766 608,573 533,455 165,068 2,206,862 9,374 Total assets 1,297,992 682,884 657,568 193,171 2,831,615 75,432 Deferred Outflows of Resources:
Changes in derivative values 5,924 812 - 1,983 8,719 -
Deferred charge on refunding 8,046 5,028 - 646 13,720 - Pension related items 9,168 3,080 2,105 1,440 15,793 780 OPEB related items 1,805 727 466 418 3,416 211
Total deferred outflows of
resources 24,943 9,647 2,571 4,487 41,648 991
See Notes to Financial Statements
25 CITY OF RIVERSIDE
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
JUNE 30, 2022
(amounts expressed in thousands)
Business-Type Activities - Enterprise Funds Governmental Electric Water Sewer
Non-Major
Enterprise
Funds
Total
Enterprise
Funds
Activities -
Internal Service
Funds
Liabilities:
Current liabilities:
Accounts payable 21,111 3,492 2,256 4,203 31,062 1,531
Accrued payroll 1,010 377 214 154 1,755 77
Retainage payable 601 541 118 497 1,757 6
Unearned revenue 1,412 1,145 - 6,152 8,709 -
Deposits 11,888 1,022 6 648 13,564 -
Accrued interest 5,465 2,009 6,631 49 14,154 -
Due to other funds - - - - - 39
Benefit/Conservation Programs
payable 624 71 - - 695 -
Total current liabilities 42,111 8,657 9,225 11,703 71,696 1,653 Noncurrent liabilities:
Due within one year:
Long-term obligations 21,356 10,195 10,619 5,794 47,964 288 Compensated absences 4,774 1,905 1,222 501 8,402 351
Claims and judgments - - - - - 15,304
Landfill capping - - - 559 559 -
Decommissioning liability 8,813 - - - 8,813 -
Lease liability 134 5 5 79 223 5
Due in more than one year:
Long-term obligations 615,834 239,544 362,832 79,238 1,297,448 4,286 Compensated absences 2,426 668 255 104 3,453 106
Claims and judgments - - - - - 63,486
Landfill capping - - - 9,261 9,261 -
Decommissioning liability 44,497 - - - 44,497 -
Regulatory liability 4,220 4,096 16,167 34 24,517 -
Derivative instruments 8,905 2,646 - 2,726 14,277 -
OPEB liability 10,460 4,286 2,984 2,605 20,335 1,207
Lease liability 363 11 11 179 564 16
Total noncurrent liabilities 721,782 263,356 394,095 101,080 1,480,313 85,049 Total liabilities 763,893 272,013 403,320 112,783 1,552,009 86,702 Deferred Inflows of Resources:
Change in derivative values - - - 252 252 -
Deferred charges on refunding - - 616 - 616 -
Pension related items 44,089 14,814 10,125 6,922 75,950 3,753 OPEB related items 1,426 562 347 317 2,652 151
Lease related items 7,964 82,838 57 5,813 96,672 -
Total deferred inflows of
resources 53,479 98,214 11,145 13,304 176,142 3,904
Net position:
Net investment in capital assets 246,698 293,641 163,884 70,246 774,469 7,123 Restricted net position:
Debt service 18,967 7,557 5,300 - 31,824 -
Landfill capping - - - 2,500 2,500 -
Regulatory requirements 19,598 - 2,456 - 22,054 -
Public Benefit Programs 25,857 - - - 25,857 -
Water Conservation Program - 3,431 - - 3,431 -
Unrestricted/(deficit) 194,443 17,675 74,034 (1,175) 284,977 (21,306) Total net position $ 505,563 $ 322,304 $ 245,674 $ 71,571 $ 1,145,112 $ (14,183) See Notes to Financial Statements
26 CITY OF RIVERSIDE
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Business-Type Activities - Enterprise Funds Governmental Electric Water Sewer
Non-Major
Enterprise
Funds
Total
Enterprise
Funds
Activities -
Internal Service
Funds
Operating Revenues:
Charges for services $ 397,947 $ 80,535 $ 71,557 $ 48,435 $ 598,474 $ 28,410 Total operating revenues 397,947 80,535 71,557 48,435 598,474 28,410 Operating Expenses:
Personnel services 32,356 10,856 8,928 6,305 58,445 3,706 Contractual services 6,466 2,527 1,017 15,559 25,569 1,576 Maintenance and operation 239,373 11,115 8,993 10,881 270,362 2,990 General 6,153 17,085 5,341 16,295 44,874 6,476
Materials and supplies 919 897 4,239 1,785 7,840 143
Claims/Insurance 1,848 1,162 1,121 650 4,781 14,887
Depreciation 36,718 16,179 14,931 5,382 73,210 741
Amortization 134 11 4 642 791 5
Total operating expenses 323,967 59,832 44,574 57,499 485,872 30,524 Operating income/(loss) 73,980 20,703 26,983 (9,064) 112,602 (2,114) Nonoperating Revenues/(Expenses):
Grant subsidies - - - 5,866 5,866 -
Interest revenue (10,330) 61 (2,782) (273) (13,324) (1,376) Interest expense and fiscal charges (25,037) (9,471) (14,486) (3,022) (52,016) (148) Capital improvement fees - - 647 - 647 -
Other 6,589 3,957 150 74 10,770 173
Gain/(loss) on disposal of capital assets 505 709 8 - 1,222 105 Total nonoperating
revenues/(expenses) (28,273) (4,744) (16,463) 2,645 (46,835) (1,246) Income/(loss) before
contributions and operating
transfers 45,707 15,959 10,520 (6,419) 65,767 (3,360)
Capital contributions 7,667 5,693 128 7,039 20,527 92
Special item - - - (694) (694) -
Extraordinary item (5,748) - - - (5,748) -
Transfers in - - - 13,273 13,273 2,714
Transfers out (39,436) (7,708) (14) (336) (47,494) (4)
Change in net position 8,190 13,944 10,634 12,863 45,631 (558) Net Position:
Beginning of year, as previously stated 497,373 308,360 234,397 58,708 1,098,838 (13,625) Prior period adjustment - - 643 - 643 -
Beginning of year, as restated 497,373 308,360 235,040 58,708 1,099,481 (13,625) End of year $ 505,563 $ 322,304 $ 245,674 $ 71,571 $ 1,145,112 $ (14,183) See Notes to Financial Statements
27 CITY OF RIVERSIDE
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Business-Type Activities - Enterprise Funds Governmental Electric Water Sewer
Non-Major
Enterprise
Funds
Total
Enterprise
Funds
Activities -
Internal
Service
Funds
Cash Flows from Operating Activities:
Cash received from customers and users $ 394,707 $ 80,337 $ 70,033 $ 50,835 $ 595,912 $ - Cash received from interfund services provided - - - - - 28,302 Cash paid to suppliers for goods or services (252,247) (32,039) (21,156) (44,571) (350,013) (24,490) Cash paid to employees for services (47,823) (15,499) (11,516) (7,916) (82,754) (4,789) Net cash provided/(used) by operating
activities 94,637 32,799 37,361 (1,652) 163,145 (977)
Cash Flows from Non-Capital Financing Activities:
Transfers in - - - 13,273 13,273 2,714
Transfers out (39,436) (7,708) (14) (1,030) (48,188) (4) Payment made to other funds - - - (3,002) (3,002) 39
Payment receipt from advances to other funds 471 - 322 - 793 - Payments on pension obligation bonds (3,310) (1,075) (671) (452) (5,508) (227) Grant subsidies - - - 5,866 5,866 -
Other receipts/(payments) from non-operating
revenue 6,463 1,496 150 146 8,255 172
Net cash provided/(used) by non-capital
financing activities (35,812) (7,287) (213) 14,801 (28,511) 2,694 Cash Flows from Capital and Related Financing
Activities:
Purchase of capital assets (32,361) (22,738) (4,350) (7,930) (67,379) (1,626) Proceeds from sales of capital assets 535 713 8 - 1,256 105 Principal paid on long-term obligations (16,581) (6,867) (9,295) (1,727) (34,470) - Interest paid on long-term obligations (25,645) (9,004) (16,577) (6,494) (57,720) (149) Capital improvement fees - - 583 - 583 -
Contributions 5,445 3,590 128 7,733 16,896 92
Lease payments (126) (5) (5) (80) (216) (6)
Net cash provided/(used) by capital and
related financing activities (68,733) (34,311) (29,508) (8,498) (141,050) (1,584) Cash Flows from Investing Activities:
Proceeds from investment securities 6,164 - - - 6,164 - Interest from investments (10,407) (101) (2,825) (298) (13,631) (1,431) Net cash provided/(used) by investing
activities (4,243) (101) (2,825) (298) (7,467) (1,431)
Net increase/(decrease) in cash and cash
equivalents (14,151) (8,900) 4,815 4,353 (13,883) (1,298) Cash and cash equivalents at beginning of year
(excluding $59,949 in restricted investments for
Electric) 351,881 73,529 104,335 10,307 540,052 58,500
Cash and cash equivalents at end of year
(excluding $53,785 restricted investments for
Electric) $ 337,730 $ 64,629 $ 109,150 $ 14,660 $ 526,169 $ 57,202 See Notes to Financial Statements
28 CITY OF RIVERSIDE
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Business-Type Activities - Enterprise Funds Governmental Electric Water Sewer
Non-Major
Enterprise
Funds
Total
Enterprise
Funds
Activities -
Internal
Service
Funds
Reconciliation of Operating Income to Net Cash
Provided/(Used) by Operating Activities:
Operating income/(loss) $ 73,980 $ 20,703 $ 26,982 $ (9,064) $ 112,601 $ (2,114) Adjustments to Reconcile Operating
Income/(Loss) Net Cash Provided/(Used) by
Operating Activities:
Depreciation 36,718 16,179 14,931 5,382 73,210 741
Amortization 134 11 4 642 791 5
(Increase)/decrease in utility billed receivable (3,908) (242) (678) (1,196) (6,024) - (Increase)/decrease in utility unbilled receivable (931) 39 (57) (64) (1,013) - (Increase)/decrease in accounts receivable (1,487) (227) (793) (1,615) (4,122) 11 (Increase)/decrease in property tax receivable - - - 20 20 - (Increase)/decrease in intergovernmental
receivable 18 1,846 5 892 2,761 (122)
(Increase)/decrease in inventory 485 - (168) (38) 279 (779) (Increase)/decrease in prepaid items 1,482 39 6 2 1,529 - (Increase)/decrease in deposits - - - (6) (6) -
(Increase)/decrease in Benefit/Conservation
Programs receivable (283) (20) - - (303) -
Increase/(decrease) in accounts payable 4,044 26 (152) 764 4,682 192 Increase/(decrease) in accrued payroll 407 180 94 67 748 31 Increase/(decrease) in retainage payable 134 240 (129) 474 719 (15) Increase/(decrease) in unearned revenue 1,345 (1,202) - 4,236 4,379 - Increase/(decrease) in deposits payable 1,325 9 - 123 1,457 - Increase/(decrease) in Benefit/Conservation
Programs payable 385 43 - - 428 -
Increase/(decrease) in compensated absences 18 (146) 26 (47) (149) (62) Increase/(decrease) in claims and judgments - - - - - 2,187 Increase/(decrease) in landfill capping liability - - - (599) (599) - Increase/(decrease) in decommissioning liability (3,334) - - - (3,334) - Changes in net pension liability/(asset) and related
deferred inflows/(outflows) of resources (16,425) (4,890) (2,836) (1,740) (25,891) (1,105) Changes in OPEB liability and related deferred
inflows/(outflows) of resources 530 211 126 115 982 53
Total adjustments 20,657 12,096 10,379 7,412 50,544 1,137 Net cash provided/(used) by operating
activities $ 94,637 $ 32,799 $ 37,361 $ (1,652) $ 163,145 $ (977) Non-Cash Investing, Capital, and Financing
Activities:
Capital contributions - capital assets $ 2,222 $ 2,103 $ - $ - $ 4,325 $ - Payment on note payable offset by rent credit - 1,890 - - 1,890 - See Notes to Financial Statements
29 CITY OF RIVERSIDE
STATEMENT OF NET POSITION
FIDUCIARY FUNDS
JUNE 30, 2022
(amounts expressed in thousands)
Private-Purpose
Trust Fund
Successor
Agency Trust
Fund Custodial Fund
Assets:
Cash and investments $ 27,851 $ 537
Cash and investments with fiscal agent 4,033 13,251
Receivables, net of allowance for uncollectible
Interest 56 -
Property taxes - 46
Accounts 475 -
Intergovernmental 795 -
Notes 1,989 -
Direct financing lease receivable 7,570 -
Lease receivable 826 -
Deposits 2 -
Land and improvements held for resale 7,361 -
Capital assets:
Capital assets, not depreciated 185 -
Total assets 51,143 13,834
Liabilities:
Accounts payable 392 -
Accrued interest 2,419 -
Advances from City 2,454 -
Noncurrent liabilities:
Due within one year:
Long-term obligations 7,143 -
Due in more than one year:
Long-term obligations 171,467 -
Total liabilities 183,875 -
Deferred Inflows of Resources:
Deferred charges on refunding 693 -
Lease related items 820 -
Total deferred inflows of resources 1,513 -
Net Position:
Restricted for other governments (134,245) 13,834
Total net position $ (134,245) $ 13,834
See Notes to Financial Statements
30 CITY OF RIVERSIDE
STATEMENT OF CHANGES IN NET POSITION
FIDUCIARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Private-Purpose
Trust Fund
Successor
Agency Trust
Fund Custodial Fund
Additions:
Property taxes $ 16,012 $ -
Special assessments - 4,399
Rental and investment income (87) 7
Miscellaneous 37 -
Issuance of long-term debt - 4,805
Total additions 15,962 9,211
Deductions:
Professional services and other deductions 2,133 143
Redevelopment projects 123 -
Principal - 2,175
Interest and fiscal charges 6,173 2,103
Total deductions 8,429 4,421
Changes in Net Position 7,533 4,790
Net Position:
Beginning of year, as previously stated (141,778) (29,921) Prior period adjustment - 38,965
Beginning of year, as restated (141,778) 9,044
End of year $ (134,245) $ 13,834
See Notes to Financial Statements
31 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
1. Summary of Significant Accounting Policies
The City of Riverside (City) was incorporated on October 11, 1883 as a Charter City a nd operates under a Council-Manager form of Government. The more significant accounting policies reflected in the financial statements are summarized as follows:
A. Reporting Entity
The financial statements present the City and its component units, entities for which the City is financially accountable. Blended component units are legally separate entities, but in substance are part of the City's operations and their data is combined with that of the City's. The City has no component units that meet the criteria for discrete presentation. All of the City's component units have a June 30 year end.
Blended Component Units
Riverside Housing Authority (Housing Authority) was established in 2006 by the City. The Housing Authority’s primary p urpose is to provide safe and sanitary housing accommodations for persons with low or moderate income. The Housing Authority’s activity h as been combined with that of the primary government because City C ouncil members serve as the Housing Authority’s commissioners and because the City i s financially a ccountable and operationally responsible for all matters.
Riverside Public Financing Authority (Public Financing Authority) was organized in December 1987 by t he City a nd the Redevelopment Agency. Pursuant to Assembly Bill 1X 26 (as modified by the California Supreme Court on December 29, 2011) all redevelopment agencies were dissolved effective February 1 , 2012. Subsequently, the City b ecame the Successor Agency t o the Redevelopment Agency. The Parking Authority o f the City o f Riverside was added as an additional member of the Public Financing Authority on August 14, 2012. The Public Financing Authority’s activity has been combined with that of the primary g overnment because City C ouncil members serve as the Public Financing Authority’s board members and because the Public Financing Authority exclusively provides financing assistance to the primary government.
The City i s also financially a ccountable and operationally r esponsible for all matters.
Riverside Municipal Improvements Corporation ( Municipal Improvements Corporation) was created in 1978 and operates under provisions of the Nonprofit Public Benefit Corporation Law of the State of California. The Municipal Improvements Corporation's primary purpose is to provide financing assistance by obtaining land, property and equipment on behalf of the City. The activity of the Municipal Improvements Corporation has been combined with that of the primary government because three members of the City Council serve as the Municipal Improvements Corporation’s directors and because the Municipal Improvements Corporation exists to serve exclusively the primary government.
The City is financially accountable and operationally responsible for all matters.
Fiduciary Component Unit
Successor Agency t o the Redevelopment Agency o f the City o f Riverside (Successor Agency) is a separate legal entity, which was formed to hold the assets and liabilities of the former Redevelopment Agency p ursuant to City Council actions taken on March 15, 2011 and January 10, 2012. The activity of the Successor Agency i s overseen by a n Oversight Board comprised of individuals appointed by various government agencies and the City of Riverside as Successor Agency o f the former Redevelopment Agency. In 2018, the oversight was transferred to the Riverside Countywide Oversight Board, as a result of state legislation that consolidated all oversight boards to successor agencies. The Countywide Oversight Board was created to oversee the winddown activities of the various successor agencies in Riverside County. The nature and significance of the relationship between the City and the Successor Agency is such that it would be misleading to exclude the Successor Agency from the City’s financial statements. The Successor Agency is presented herein in the City’s fiduciary funds as a private-purpose trust fund.
Complete financial statements are prepared for the Riverside Public Financing Authority and the Successor Agency to the Redevelopment Agency of the City of Riverside, which can be obtained from the City's Finance Department, 3900 Main Street, Riverside, California, 92522 or online at www.riversideca.gov.
B. Government-wide and Fund Financial Statements
The government-wide financial statements report information on all of the non- fiduciary a ctivities of the City a nd its component units. I nterfund activity h as been removed from these statements except for utility charges, as this would distort the presentation of function costs and program revenues. Governmental activities, which normally a re supported by t axes and intergovernmental revenues, are reported separately from business type activities, which rely to a significant extent on fees and charges for support.
32 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
The statement of net position presents financial information on all of the City’s assets, liabilities, and deferred inflows/outflows of resources, with the difference reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City i s improving or deteriorating.
The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly i dentifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment, and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly i ncluded among program revenues are reported instead as general revenues. Indirect expenses are allocated to the various functions based on a proportionate utilization of the services rendered. Such allocations consist of charges for accounting, human resources, information technology and other similar support services.
Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary f unds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements.
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
The government-wide, proprietary and fiduciary funds financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability i s incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied on the property. Grants and similar items are recognized as revenue as soon as all eligibility r equirements have been met. An allowance for doubtful accounts is maintained for the utility and other miscellaneous receivables.
Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting.
Revenues are recognized as soon as they are both measurable and available.
Revenues are considered to be available when they a re collectible within the current period or soon enough thereafter to pay liabilities of the current period.
Revenues are considered to be available if they are generally collected within 60 days after year end, except for revenue associated with neglected property abatement which is eleven (11) months and except for grant revenue, including reimbursement received from Transportation Uniform Mitigation Fees, which is six (6) months. Grant revenue is recognized if received within six (6) months of year end to enable the matching of revenue with applicable expenditures.
Expenditures generally a re recorded when a liability is incurred under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due.
Property t axes, special assessments, sales taxes, franchise taxes, licenses, charges for services, amounts due from other governments and interest associated with the current fiscal period are all considered to be susceptible to accrual. Other revenue items such as fines and permits are considered to be measurable and available only w hen the government receives cash and are therefore not susceptible to accrual.
The government reports the following major governmental funds:
The General fund is the government’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund.
The Capital Outlay f und accounts for the construction and installation of street and highway c apital improvements for the City, including improvements funded by the ½% sales tax approved by Riverside County in 1988.
The General Debt Service fund accounts for the accumulation of resources and payment of long-term debt obligations of the City and related entities.
The government reports the following major proprietary funds:
The Electric fund accounts for the activities of the City ’s electric distribution operations.
The Water fund accounts for the activities of the City’s water distribution operations.
The Sewer fund accounts for the activities of the City’s sewer systems.
Additionally, the government reports the following fund types:
Special Revenue funds account for proceeds of specific revenue sources 33 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
that are legally restricted or otherwise committed or assigned for specific purposes.
Capital Projects funds account for the acquisition and construction of major capital facilities other than those financed by proprietary funds.
Internal Service funds account for self-insurance, central stores, and central garage on a cost reimbursement basis.
Fiduciary f unds include private-purpose trust and custodial funds. The private-purpose trust fund accounts for assets and activities of the dissolved Redevelopment Agency, which is accounted for in the Successor Agency T rust. The custodial funds are used to account for special assessments that service no-commitment debt.
The Permanent fund is a governmental fund that is used to report resources that are legally r estricted to the extent that only e arnings, and not principal, may be used for purposes that support the City’s Library programs. Non-expendable net position on the Statement of Net Position includes $1.5 m illion of permanent fund principal which are considered nonexpendable.
Amounts reported as program revenues include 1) charges to customers for goods, services, or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments.
Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes.
Proprietary f unds distinguish operating revenues and expenses from non- operating items. Operating revenues and expenses generally r esult from providing services and producing and delivering goods in connection with a proprietary f und’s principal ongoing operations. The Sewer fund also recognizes, as operating revenue, the portion of connection fees intended to recover the cost of connecting new customers to the system. Operating expenses for enterprise funds and internal service funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses.
D. Cash and Investments
The City values its cash and investments in accordance with the provisions of Governmental Accounting Standards Board Statement No. 72 (GASB 72), Fair Value Measurement and Application, which requires governmental entities to use valuation techniques that are appropriate under the circumstances and for which sufficient data are available to measure fair value.
The techniques should be consistent with one or more of the following approaches: the market approach, the cost approach or the income approach.
Cash accounts of all funds are pooled for investment purposes to enhance safety and liquidity while maximizing interest earnings. Investments are stated at fair value except for investments in investment contracts which are recorded at contract value. All highly liquid investments (including restricted assets) with a maturity of 90 days or less when purchased are considered cash equivalents.
Cash and investments held on behalf of proprietary funds by the City Treasurer are considered highly l iquid and are classified as cash equivalents for the purpose of presentation in the statement of cash flows.
E. Restricted Cash and Investments
Certain proceeds of long-term indebtedness, as well as certain resources set aside for their repayment, are classified as restricted assets on the statement of net position because their use is limited by a pplicable bond covenants.
Restricted cash and investments also include cash set aside for nuclear decommissioning, public benefit programs, regulatory r equirements and rate stabilization because their use is legally r estricted to a specific purpose.
Unspent proceeds received from the City’s landfill capping surcharge are also recorded as restricted assets.
F. Allowance for Doubtful Accounts
Management determines the allowance for doubtful accounts by a nalyzing customer accounts for all balances over 60 days old. The allowance for doubtful accounts is then adjusted at fiscal year-end based on the amount equal to the annual uncollectible accounts. Utility customer closed accounts are written off when deemed uncollectible. Recoveries to utility c ustomer receivables previously w ritten off are recorded when received. For non-utility a ccounts receivables, delinquent notices after 60 days are sent to customers with outstanding balances. After 120 days, accounts still outstanding are referred to the City’s collection agency. As of June 30, 2022, the City had an allowance for doubtful account balance of $9,669 f or all accounts receivables. 34 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
G. Land and Improvements Held of Resale
Land and improvements held for resale were generally a cquired for future development projects. The properties are carried at the lower of cost or net realizable value.
H. Inventory
Supplies are valued at cost using the average-cost method. Costs are charged to user departments when consumed rather than when purchased.
I. Prepaid Items
Payments to vendors for services benefiting future periods are recorded as prepaid items and expenditures are recognized when items are consumed.
J. Capital Assets
Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, bridges, sidewalks, right of way, and similar items), are reported in the applicable governmental activities and business-type activities of the government-wide financial statements and in the proprietary funds and the fiduciary private-purpose trust fund statements of net position. The government defines capital assets as assets with an initial, individual cost of more than five thousand dollars and an estimated useful life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Costs include: labor; materials; interest during construction; allocated indirect charges such as engineering, construction and transportation equipment, retirement plan contributions and other fringe benefits. Donated capital assets or donated works of art and similar items are recorded at acquisition cost at the date of donation. Capital assets received in a service concession arrangement are recorded at acquisition value. Intangible assets that cost more than one hundred thousand dollars with useful lives of at least three years are capitalized and are recorded at cost. Interest incurred during the construction phase is expensed in the period incurred.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Capital assets other than land are depreciated using the straight-line method. Estimated useful lives used to compute depreciation are as follows:
Buildings and improvements 30-50 years
Improvements other than buildings 20-99 years
Intangibles, depreciable 3-15 years
Machinery and equipment 3-15 years
Infrastructure 20-100 years
K. Leases
Leases are defined by the general government as the right to use an underly ing asset. As lessee, the City recognizes a lease liability and an intangible right-of- use lease asset at the beginning of a lease unless the lease is considered a short-term lease or transfers ownership of the underlying asset. Right-of-use lease assets are measured based on the net present value of the future lease payments at inception, using the weighted average cost of capital, which approximate the incremental borrowing rate. Re measurement of a lease liability occurs when there is a change in the lease term and/or other changes that are likely t o have a significant impact on the lease liability. The City calculates the amortization of the discount on the lease liability and report that amount as outflows of resources. Payments are allocated first to accrued interest liability and then to the lease liability. Variable lease payments based on the usage of the underlying assets are not included in the lease liability calculations but are recognized as outflows of resources in the period in which the obligation was incurred. As lessor, the City recognizes a lease receivable.
The lease receivable is measured using the net present value of future lease payments to be received for the lease term and deferred inflow of receivables at the beginning of the lease term. Periodic amortization of the discount on the receivable are reported as interest revenue for that period. Deferred inflows of resources are recognized as inflows on a straight-line basis over the term of the lease. This recognition does not apply t o short-term leases, contracts that transfer ownership, leases of assets that are investments, or certain regulated leases. Any initial direct costs are reported as an outflow of resources for that period. Re-measurement of lease receivables occur when there are modifications, including but not limited to changes in the contract price, lease term, and adding or removing an underlying asset to the lease agreements. In the case of a partial or full lease termination, the carrying value of the lease receivable and the related deferred inflow of resources will be reduced and will include a gain or loss for the difference. For lease contracts that are short-term, the City r ecognizes short-term lease payments as inflows of resources (revenues) based on the payment provisions of the lease contract. Liabilities are only recognized if payments are received in advance, and receivables are only recognized if payments are received subsequent to the reporting period. Leases 35 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
between the Airport System and air carriers and other aeronautical users are subject to external laws and regulations. As permitted by G ASBS No. 87, paragraph 43, the Airport System recognizes inflows of resources based on the payment provisions of the lease contract, and the accounting policies do not apply to regulated leases. Additional disclosures regarding regulated leases are in Note 9
L. Compensated Absences
City e mployees receive 10 to 25 vacation days a year based upon length of service. A maximum of two years' vacation accrual may be accumulated, any excess vacation must be used in accordance to policy, and unused vacation is paid in cash upon separation.
City e mployees generally r eceive one day o f sick leave for each month of employment with unlimited accumulation. Upon retirement or death, certain employees or their estates receive a percentage of unused sick leave paid in a lump sum based on longevity. The General, Electric and Water funds have been primarily used to liquidate such balances.
The liability associated with these benefits is reported in the government-wide statements. Vacation and sick leave of proprietary f unds is recorded as an expense and as a liability of those funds as the benefits accrue to employees.
M. Derivative Instruments
The City’s derivative instruments are accounted for in accordance with Government Accounting Standards Board Statement No. 53 (GASB 53), Accounting and Financial Reporting for Derivative Instruments, which requires the City to report its derivative instruments at fair value. Changes in fair value for effective hedges that are achieved with derivative instruments are reported as deferrals in the statements of net position.
The City uses derivative instruments to hedge its exposure to changing interest rates through the use of interest rate swaps. The City had debt that was layered with “synthetic fixed rate” swaps, which was refunded in 2008 and 2011. The balance of the deferral account for each swap is included as part of the deferred charge on refunding associated with the new bonds. The swaps were also employed as a hedge against the new debt. Hedge accounting was applied to that portion of the hedging relationship, which was determined to be effective.
The negative fair value of the interest rate swaps related to the new hedging relationship has been recorded and deferred on the statement of net position.
See Note 7 for further discussion related to the City’s interest rate swaps.
Various transactions permitted in the Utility’s Power Resources Risk Management Policies may be considered derivatives, including energy a nd/or gas transactions for swaps, options, forward arrangements and congestion revenue rights. The City h as determined that all of its contracts including congestion revenue rights fall under the scope of “normal purchases and normal sales” and are exempt from GASB 53.
N. Long-Term Obligations
Long-Term Debt
Long-term debt and other long-term obligations are reported as liabilities in the applicable governmental and business-type activities columns in the government-wide financial statements and in the proprietary funds and fiduciary funds statements of net position. Bond premiums and discounts are deferred and amortized over the life of the bonds using the effective interest method.
Bonds payable are reported net of the applicable bond premium or discount.
In the fund financial statements, government fund types recognize bond issuance costs as expenditures during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuance are reported as other financing uses.
Decommissioning
The City h as a 1.79 percent undivided ownership interest in Units 2 and 3 of San Onofre Nuclear Generating Station (SONGS), located south of the City of San Clemente in northern San Diego County. Both Units 2 and 3 of SONGS were permanently retired on June 2013. Consequently, the units are no longer a source of supply for the Electric Utility, but remain associated with certain of its costs, including those associated with the units' shutdown and decommissioning (see Note 13 for nuclear decommissioning liability).
The other owners are SCE, with a 78.21 percent interest (including the 3.16 percent interest it acquired from the City of Anaheim in 2006), and San Diego Gas & Electric Company (SDG&E), with a 20.00 percent interest.
In 2005, the California Public Utilities Commission (CPUC) authorized a project to install four new steam generators in Units 2 and 3 at SONGS and remove and dispose of the predecessor generators. SCE completed the installation of these steam generators in 2010 and 2011 for Units 2 and 3, respectively. The Electric Utility's share of the cost to replace the steam generators was 36 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
approximately $ 13.4 million. Replacement of the steam generators was expected to enable plant operations to continue through at least 2022, and perhaps beyond, subject to the approval of the NRC.
In January 2012, a water leak occured in one of the heat transfer tubes of Unit 3's steam generators, causing it to be shut down. At that time, Unit 2 was off- line for a planned outage when unexpected wear in areas of tube-to-support structure was found. Units 2 and 3 remained offline for extensive inspections, testing and analysis of their system generators. On June 7, 2013, SCE unilaterally announced its plan to retire Units 2 and 3 permanently.
As a result of SCE's decision to permanently retire SONGS Units 2 and 3, the decommissioning phase of the plant began in June 2013. The process of decommissionining the nuclear power plant is expected to take many years and is governed by N RC regulations. According to SCE's decommissioning cost estimate document as of March 2018 in 2017 dollars, total decommissioning costs for Units 2 and 3 were estimated at $4.7 billion, of which the Electric Utility's share was $84 million.
In August 2021, SCE provided the updated decommissioning cost estimate document in 2020 dollars. According to the update, total decommissioning costs for Units 2 and 3 are estimated at $5.2 billion, of which the Electric Utility's share is $93.8 million.
As of June 30, 2022, the Electric Utility h as set aside $42,082 i n cash investments with the trustee and $16,107 i n an designated decommissioning reserve for the Electric Utility’s estimated share of the decommissioning costs.
Increases to the funds held for decommissioning liability a re from investment earnings. The investment earnings are included in investment income in the Electric Utility’s financial statements. An equivalent amount is reflected as decommissioning expense, which is considered part of production and purchased power. Decreases to the funds held for decommissioning liability are from actual funds drawn from the trust for decommissioning costs invoiced by SCE.
On February 2 3, 2016, the City C ouncil adopted a resolution authorizing the commencement of SONGS decommissioning effective June 7, 2013. This resolution allows the Electric Utility to access the decommissioning trust funds to pay for its share of decommissioning costs. The Electric Utility began drawing decommissioning trust funds to pay for decommissioning costs in the fiscal year ended June 30, 2017. As of June 30, 2022, the Electric Utility has paid to date $40,539 i n decommissioning obligations which have been reimbursed by t he trust funds.
O. Claims and Judgments Payable
Claims and judgments payable are recognized when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. Such claims, including an estimate for claims incurred but not reported at year end, are recorded as liabilities in the self-insurance internal service fund. As of June 30, 2022, the City had an obligation related to claims and judgments which is reflected as a liability o n the government-wide statements and is more fully described in Note 11.
P. Fund Equity
In the fund financial statements, governmental fund balance is made up of the following components:
Nonspendable fund balance is the portion of fund balance that cannot be spent due to form. Examples include inventories, prepaid amounts, long-term loans, and notes receivable, unless the proceeds are restricted, committed or assigned. Also, amounts that must be maintained intact legally o r contractually, such as the principal of a permanent fund are reported within the nonspendable category. Restricted fund balance is the portion of fund balance that is subject to externally e nforceable limitations by l aw, enabling legislation or limitations imposed by creditors or grantors.
Committed fund balance is the portion of fund balance that can only be used for specific purposes due to formal action of the City C ouncil through adoption of a resolution prior to the end of the fiscal year.
Once adopted, the limitation imposed by r esolution remains in place until a similar action is taken (the adoption of another resolution) to remove or revise the limitation. On September 6, 2016, the City Council approved the General Fund Reserve Policy s etting a 10% minimum i n the Emergency R eserve and 5% in the Contingency Reserve with an aspirational goal of 15% in the Emergency Reserve.
The Emergency R eserve was established for the purpose of addressing any e xtremely u nusual and infrequent occurrences, such as a major natural disaster or a major unforeseen settlement.
Utilization of the Emergency R eserve requires declaration of an 37 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
emergency b y a two-thirds majority o f the City C ouncil, and specification of the maximum dollar amount to be used. The Contingency R eserve was established for the purpose of providing a “bridge” to facilitate a measured and thoughtful reduction in expenditures during times of economic downturn, rather than making immediate and drastic budget reductions without the time for proper evaluation. Utilization of the Contingency R eserve, including specification of the maximum dollar amount to be used, requires approval by a t wo-thirds majority o f the City C ouncil. The reserves committed at June 30, 2022 w ere calculated utilizing fiscal year 2022-2023 adopted General Fund expenditure budget of $305,670.
On April 2, 2019, the City C ouncil approved the General Fund - Measure Z Contingency R eserve Policy s etting a required $5,000 i n the Contingency Reserve. The Contingency Reserve was established to cover necessary expenses in order to provide time for a measured and thoughtful reduction in expenditures during times of economic downturn, rather t han making immediate and drastic budget reductions without the time for proper evaluation. Utilization of the Contingency R eserve, including specification of the maximum dollar amount to be used, requires the affirmative votes of at least five members of the City Council.
Assigned fund balance reflects the City’s intended use of resources.
Intent can be expressed by the City Council or by an official to which the City C ouncil delegates the authority. On February 2 2, 2011, the City C ouncil approved a policy w hereby t he authority t o assign fund balance was delegated to the City’s Chief Financial Officer, which authorized the assignment of fund balance for specific programs or purposes in accordance with City C ouncil directives. The City a lso uses budget and finance policy t o authorize the assignment of fund balance, which is done through the adoption of the budget and subsequent budget amendments throughout the year.
Unassigned fund balance is the residual classification that includes all spendable amounts in the General Fund not contained in other classifications.
When expenditures are incurred for purposes for which both restricted and unrestricted (committed, assigned or unassigned) fund balances are available, the City’s policy i s to use restricted amounts before unrestricted amounts.
Within unrestricted resources, committed resources are used first followed by assigned resources, and finally unassigned resources.
Q. Net Position
Net position represents the difference between assets and deferred outflows less liabilities and deferred inflows. Net position invested in capital assets consists of capital assets, net of accumulated depreciation, reduced by t he outstanding balances of any b orrowings used for the related acquisition, construction or improvement of those assets excluding unspent debt proceeds.
Restricted net position represents restricted assets less liabilities and deferred inflows related to those assets. Restricted assets are recorded when there are limitations imposed on their use either through legislation adopted by the City or through external restrictions imposed by c reditors, grantors or laws or regulations of other governments. Restricted resources are used first to fund appropriations.
R. Interfund Transactions
Interfund transactions are accounted for as revenues and expenditures or expenses. Transactions, which constitute reimbursements, are eliminated in the reimbursed fund and accounted for as expenditures or expenses in the fund to which the transaction is applicable.
During the year, transactions occur between individual funds for goods provided or services rendered. Related receivables and payables are classified as "due from/to other funds" on the accompanying fund level statements. The noncurrent portion of long-term interfund loans receivable are reported as advances and, for governmental fund types, are equally offset by nonspendable fund balance to indicate that the receivable is not in spendable form.
Any r esidual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as “internal balances.”
S. Unearned Revenue
Unearned revenues arise when the government receives resources before it has a legal claim to them, as when grant monies are received prior to meeting all eligibility r equirements. In subsequent periods, when both revenue recognition criteria are met, or when the government has a legal claim to the resources, revenue is recognized.
38 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
T. Unavailable Revenue
Unavailable revenue arises only under a modified accrual basis of accounting.
Accordingly, unavailable revenue is reported only i n the governmental funds balance sheet. These amounts are deferred and recognized as an inflow of resources (revenue) in the period that the amounts become available.
U. Deferred Outflows and Deferred Inflows of Resources
When applicable, the statement of net position and the balance sheet will report a separate section for deferred outflows of resources. Deferred outflows of resources represent outflows of resources (consumption of net assets) that apply to future periods and that, therefore will not be recognized as an expense or expenditure until that time.
Conversely, deferred inflows of resources represent inflows of resources (acquisition of net assets) that apply to future periods and that, therefore, are not recognized as an inflow of resources (revenue) until that time.
V. Regulatory Assets and Deferred Regulatory Charges
In accordance with GASB Statement No. 62, enterprise funds that are used to account for rate-regulated activities are permitted to defer certain expenses and revenues that would otherwise be recognized when incurred, provided that the City i s recovering or expects to recover or refund such amounts in rates charged to its customers. Accordingly, regulatory a ssets and/or deferred regulatory c harges have been recorded in the Electric, Water, Sewer and Refuse funds.
W. Property Tax Calendar
Under California law, general property taxes are assessed for up to 1% of the property’s assessed value. General property taxes are collected by the counties along with other special district taxes and assessments and voter approved debt. General property t ax revenues are collected and pooled by t he county throughout the fiscal year and then allocated and paid to the county, cities and school districts based on complex formulas prescribed by State statutes.
Property t axes are calculated on assessed values as of January 1 f or the ensuing fiscal year. On January 1 of the fiscal year the levy is placed and a lien is attached to the property. Property taxes are due in two installments. The first installment is due November 1 and is delinquent after December 10. The second installment is due February 1 and is delinquent after April 10. The City generally a ccrues only t hose taxes, which are received within sixty days after the year-end. Under the Teeter plan, the County of Riverside has responsibility for the collection of delinquent taxes and the City receives 100% of the levy.
X. Use of Estimates
The preparation of financial statements in conformity with accounting principles generally a ccepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenditures.
Specifically, the City h as made certain estimates and assumptions relating to the revenues due and expenditures incurred through fiscal year end, collectability o f its receivables, the valuation of property h eld for resale, the useful lives of capital assets, and the ultimate outcome of claims and judgments. Actual results may differ from those estimates and assumptions.
Y. Pensions
For purposes of measuring the net pension asset/liability a nd deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary n et position of the City o f Riverside California Public Employees’ Retirement System (CalPERS) plans (Plans) and additions to/deductions from the Plans’ fiduciary n et position have been determined on the same basis as they a re reported by C alPERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
Z. Other Post-Employment Benefit (OPEB)
OPEB refers to the benefits, other than pensions, that the City provides as part of an employee’s retirement benefits. The OPEB liability i s defined as the liability of employers contributing to employees for benefits provided through a defined benefit OPEB plan that is administered through a trust.
AA. New Accounting Pronouncements
The following new Governmental Accounting Standards Board (GASB) pronouncements were effective and have been implemented for fiscal year 2021-2022 audit:
GASB Statement No. 87, Leases - This Statement defines a lease as a contract that conveys control of the right to use another entity’s nonfinancial asset (the 39 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
underlying asset) as specified in the contract for a period of time in an exchange or exchange-like transaction. It requires recognition of certain lease assets and liabilities, for leases that were previously c lassified as operating leases, and establishes a single model for lease accounting. Under this Statement, a lessee is required to recognize a lease liability and an intangible right-to-use asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources.
GASB Statement No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period. - This Statement requires that interest cost incurred before the end of a construction period be recognized as an expense in the period in which the cost is incurred for financial statements prepared using the economic resources measurement focus. As a result, interest cost incurred before the end of a construction period will not be included in the historical cost of a capital asset reported in a business-type activity or enterprise fund.
GASB Statement No. 97, Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans - This Statement requires that for purposes of determining whether a primary g overnment is financially a ccountable for a potential component unit, except for a potential component unit that is a defined contribution pension plan, a defined contribution OPEB plan, or another employee benefit plan (for example, certain Section 457 plans), the absence of a governing board should be treated the same as the appointment of a voting majority of a governing board if the primary government performs the duties that a governing board typically would perform.
The following GASB pronouncements are effective in the following fiscal years’ audits and should be reviewed for proper implementation by management:
Fiscal year 2023
GASB Statement No. 91, Conduit Debt Obligations - This Statement clarifies the existing definition of a conduit debt obligation; establishes that a conduit debt obligation is not a liability o f the issuer; establishes standards for accounting and financial reporting of additional commitments and voluntary commitments extended by i ssuers and arrangements associated with conduit debt obligations; and improves required note disclosures.
GASB Statement No. 94, Public-Private and Public-Public Partnerships and Availability P ayment Arrangement - A Public-Private and Public-Public Partnerships (PPP) is an arrangement in which a government (the transferor) contracts with an operator (a governmental or nongovernmental entity) to provide public services by c onveying control of the right to operate or use a nonfinancial asset, such as infrastructure or other capital asset (the underlying PPP asset), for a period of time in an exchange or exchange-like transaction.
Some PPPs meet the definition of a service concession arrangement (SCA) in which (1) the operator collects and is compensated by fees from third parties; (2) the transferor determines or has the ability t o modify o r approve which services the operator is required to provide, to whom the operator is required to provide the services, and the prices or rates that can be charged for the services; and (3) the transferor is entitled to significant residual interest in the service utility of the underlying PPP asset at the end of the arrangement. This Statement also provides guidance for accounting and financial reporting for availability payment arrangements (APAs). An APA is an arrangement in which a government compensates an operator for services that may include designing, constructing, financing, maintaining, or operating an underlying nonfinancial asset for a period of time in an exchange or exchange-like transaction.
GASB Statement No. 96, Subscription-Based Information Technology Arrangements – This Statement defines Subscription-Based Information Technology A rrangements (SBITA) as a contract that conveys control of the right to use another party’s (a SBITA vendor’s) information technology ( IT) software, alone or in combination with tangible capital assets (the underlying IT assets), as specified in the contract for a period of time in an exchange or exchange-like transaction. This Statement establishes that a SBITA results in a right-to-use subscription asset—an intangible asset—and a corresponding subscription liability; (3) provides the capitalization criteria for outlays other than subscription payments, including implementation costs of a SBITA; and (4) requires note disclosures regarding a SBITA. T he standards for SBITAs are based on the standards established in Statement No. 87, Leases, as amended.
Fiscal year 2024
GASB Statement No. 99, Omnibus 2022 - This Statement- provide clarification on previously i ssued Statement including classification and reporting of derivative instruments within the scope of Statement No. 53 Accounting and Financial Reporting for Derivative Instruments, that do not meet the definition of either an investment derivative instrument or a hedging derivative instrument, clarification of provisions in Statement No. 87, Leases, as amended, related to the determination of the lease term, classification of a lease as a short-term lease, recognition and measurement of a lease liability and a lease asset, and identification of lease incentives, clarification of provisions in Statement No. 94, Public-Private and Public-Public Partnerships and Availability P ayment 40 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Arrangements, related to (a) the determination of the public-private and public- public partnership (PPP) term and (b) recognition and measurement of installment payments and the transfer of the underlying PPP asset, clarification of provisions in Statement No. 96, Subscription-Based Information Technology Arrangements, related to the subscription-based information technology arrangement (SBITA) term, classification of a SBITA as a short-term SBITA, and recognition and measurement of a subscription liability, extension of the period during which the London Interbank Offered Rate (LIBOR) is considered an appropriate benchmark interest rate for the qualitative evaluation of the effectiveness of an interest rate swap that hedges the interest rate risk of taxable debt, accounting for the distribution of benefits as part of the Supplemental Nutrition Assistance Program (SNAP), disclosures related to nonmonetary transactions, pledges of future revenues when resources are not received by t he pledging government, clarification of provisions in Statement No. 34, Basic Financial Statements—and Management’s Discussion and Analysis—for State and Local Governments, as amended, related to the focus of the government-wide financial statements, terminology u pdates related to certain provisions of Statement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position, and terminology used in Statement 53 to refer to resource flows statements.
GASB Statement No. 100, Accounting Changes and Error Corrections. - This Statement defines accounting changes as changes in accounting principles, changes in accounting estimates, and changes to or within the financial reporting entity a nd describes the transactions or other events that constitute those changes. It prescribes the accounting and financial reporting for (1) each type of accounting change and (2) error corrections, and requires that (a) changes in accounting principles and error corrections be reported retroactively by restating prior periods, (b) changes to or within the financial reporting entity be reported by a djusting beginning balances of the current period, and (c) changes in accounting estimates be reported prospectively by recognizing the change in the current period.
Fiscal year 2025
GASB Statement No. 101, Compensated Absences - This Statement requires that liabilities for compensated absences be recognized for (1) leave that has not been used and (2) leave that has been used but not yet paid in cash or settled through noncash means. It also requires that a liability for certain types of compensated absences—including parental leave, military l eave, and jury duty leave—not be recognized until the leave commences. This Statement also requires that a liability f or specific types of compensated absences not be recognized until the leave is used. Further, this Statement establishes guidance for measuring a liability f or leave that has not been used, generally u sing an employee’s pay rate as of the date of the financial statements.
New Accounting Pronouncements In June 2017, the GASB issued Statement No. 87, “Leases”. This statement increases the usefulness of governments’ financial statements by r equiring recognition of certain lease assets and liabilities for leases that previously w ere classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract. The requirements of this statement are effective for financial statements for periods beginning after December 15, 2019. The City has implemented GASB 87 in this annual report
2. Legal Compliance - Budgets
Budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America. Annual appropriated budgets are adopted for all departments within the general, special revenue and capital project funds. Formal budgets are not employ ed for debt service funds because debt indenture provisions specify p ayments. The permanent fund is not budgeted.
Biennually, during the period December through February, department heads prepare estimates of required appropriations for the following two-year budget cycle. These estimates are compiled into a proposed operating budget that includes a summary o f proposed expenditures and financial resources and historical data for the preceding budget cycle. At least thirty-five days prior to the beginning of the fiscal year, the City Manager provides the proposed budget in writing to the City Council for review. Following Council review, a public hearing is set to obtain citizen comments. The City C ouncil generally c onducts the public hearing and adopts the budget during one of its June meetings. The City Manager is legally authorized to transfer budgeted amounts between divisions and accounts within the same department. Transfer of appropriations between departments or funds and increased appropriations must be authorized by the City C ouncil. Expenditures may not legally e xceed budgeted appropriations within a fund. All appropriations shall lapse at the end of the fiscal year to the extent they h ave not been expended or lawfully e ncumbered, except for appropriations for capital projects which shall continue to their completion. 41 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Per City C ouncil direction, City i ntends to shift from an incremental budget methodology t o a priority-based budgeting methodology i n FY 2022/23.
Therefore, the City adopted a one-year budget for FY 2021/22 following a public hearing on June 22, 2021.
3. Cash and Investments
Cash and investments at fiscal year-end consist of the following:
Investments $ 846,451
Investments with fiscal agent 101,800
948,251
Cash on hand and deposits with financial institutions 160,091 Total $ 1,108,342
The amounts are reflected in the statements of net position of the government- wide and fiduciary fund financial statements:
Cash and investments $ 886,186
Restricted cash and cash equivalents 77,945
Restricted cash and investments with fiscal agent 98,539 Total per statement of net position 1,062,670
Fiduciary fund cash and investments 28,388
Fiduciary fund cash and investments with fiscal agent 17,284 Total $ 1,108,342
The City follows the practice of pooling cash and investments of all funds except for funds required to be held by o utside fiscal agents under the provisions of bond indentures, which are administered by outside agencies.
Interest income earned on pooled cash and investments is allocated monthly to funds based on the beginning and month-end balances. Interest income from cash and investments held at fiscal agents is credited directly t o the related account. Bank deposits are covered by federal depository insurance for the first $250 or by collateral held in the pledging bank’s trust department in the name of the City.
Authorized Investments
Under provisions of the City's investment policy, and in accordance with California Government Code Section 53601, the City T reasurer may invest or deposit in the following types of investments:
Max
Maturity
Max % of
Portfolio
Local Agency Investment Fund (State Pool) N/A N/A
Money Market Mutual Funds N/A %20
Mutual Funds N/A %20
Joint Powers Authority Pools N/A N/A
Medium-Term Corporate Notes 5 years %30
Municipal Bonds 5 years %30
Negotiable Certificates of Deposit 5 years %30
Mortgage Pass-Through and Asset-Backed Securities 5 years %20 Certificates of Deposit Placement Services 5 years %30
Collateralized Time Deposits 5 years %30
Federally Insured Time Deposits 5 years %30
Supranational Securities 5 years %30
Federal Agency Obligations 5 years N/A
U.S. Treasury Obligations 5 years N/A
Repurchase Agreements 1 year N/A
Commercial Paper of "prime" quality 270 days %25
Bankers' Acceptance 180 days %10
Reverse Repurchase Agreements 92 days %20
Investments in Medium-Term Corporate Notes may be invested in securities rated “A” or its equivalent or better by a t least one nationally r ecognized statistical rating organization at the time of purchase. No more than 5% of the portfolio may be invested in any single issuer.
Investments in Negotiable Certificates of Deposit exceeding federal deposit insurance limits shall be issued by i nstitutions which have long-term debt obligations rated in a rating category o f “A” (or the equivalent) or better and short-term debt obligations, if any, rated “A-1” (or the equivalent) or better by at least one nationally recognized statistical rating organization. No more than 5% of the portfolio may be invested in any s ingle issuer of non-negotiable or negotiable certificates of deposit.
Investments in Commercial Paper may be invested in securities rated “A-1” (or the equivalent) or higher by at least one nationally recognized statistical rating organization. In addition, debt other than Commercial Paper, if any, issued by corporations in this category must be rated at least in a rating category of “A” (or the equivalent) or better by at least one nationally recognized statistical rating organization. No more than 5% of the portfolio may be invested in any single issuer. For purposes of this issuer limitation, holdings of Commercial Paper shall be combined with holdings of Medium-Term Corporate Notes. No more 42 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
than 25% of the total portfolio may be invested in Commercial Paper. No more than 10% of the outstanding Commercial Paper of any s ingle issuer may be purchased.
The City’s investment policy p rovides the following three exceptions to the above: (1) investments authorized by debt agreements, (2) investments in the City o f Riverside - 115 Trust for Pension and (3) funds reserved in the San Onofre Nuclear Generating Station Decommissioning Account for which the five-year maturity l imitation may be extended to the term of the operating license.
Investments Authorized by Debt Agreements
Provisions of debt agreements, rather than the general provisions of the California Government Code or the City’s investment policy, govern investments of debt proceeds held by b ond fiscal agents. Permitted investments are specified in related trust agreements and include the following:
Securities of the U.S. Government and its sponsored agencies Bankers' Acceptances rated in the single highest classification Commerical Paper rated AA or higher at the time of purchase Investments in money m arket funds rated in the single highest classification, except for certain debt proceeds which have no minimum rating requirement
Municipal obligations rated Aaa/AAA or general obligations of states with ratings of at least A2/A or higher by both Moody's and S&P Investment Agreements
No maximum percentage of the related debt issue or maximum investment in one issuer is specified.
Investments in the City of Riverside - 115 Trust for Pension The City has established the City of Riverside - 115 Trust for Pension (the Plan) to accumulate resources for future contributions to CalPERS. As of June 30, 2022, the City had $19,423 of restricted cash and investments reported in the General Fund in a Section 115 Trust restricted for future pension contributions.
The City h as retained US Bank as the trustee. US Bank has delegated investment authority t o HighMark Capital Management, an SEC-registered investment adviser, with the full investment discretion over the managed assets in the account. The goal of the Plan’s investment program is to provide a reasonable level of growth which, will result in sufficient assets to pay t he present and future obligations of the Plan.
Investment Time Horizon: Intermediate-Term 5 - 7 years Anticipated Cash Flows: Assets in the Plan will seek to mitigate the impact of future rate increases from CalPERS.
Investment Objective: Moderately Conservative
Risk Tolerance: Moderately Conservative
Portfolio Type: Index Plus (passive)
Strategic Asset Allocation:
Strategic Asset
Allocation Ranges Policy
Cash 0% - 20% 5%
Fixed income 50% - 80% 65%
Equity 20% - 40% 30%
Investment Limitations: The following investment transactions are prohibited:
Direct investments in precious metals (precious metals mutual funds and exchange-traded funds are permissible).
Venture Capital
Short sales*
Purchases of Letter Stock, Private Placements, or direct payments Leveraged Transactions*
Commodities Transactions Puts, calls, straddles, or other option strategies*
Purchases of real estate, with the exception of REITs Derivatives, with exception of Exchange Traded Funds (ETFs)* * Permissible in diversified mutual funds and exchange-traded funds Disclosures Relating to Fair Value Measurement and Application Certain assets and liabilities are required to be reported at fair value. The fair value framework provides a hierarchy t hat prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identifcal assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of fair value hierarchy a re described as 43 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
follows:
Level 1 – Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in an active market
Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly and fair value is determined through the use of models or other valuation methodologies including:
Quoted prices for similar assets or liabilities in active markets; Quoted prices for identical or similar assets or liabilities in markets that are inactive;
Inputs other than quoted prices that are observable for the asset or liability;
Inputs that are derived principally from or corroborated by observable market data by correlation or other means.
Level 3 – Inputs to the valuation methodology are unobservable and significant to the fair value measurement. These unobservable inputs reflect the City's own assumptions about the inputs market participants would use in pricing the asset or liability ( including assumptions about risk). The unobservable inputs are developed based on the best information available in the circumstances and may include the City's own data.
The fair value of the City's investments in categorized within Level 2 of the fair value hierarchy u sing the institutional bond quotes with evaluations based on various market and industry inputs.
The City h as the following recurring fair value measurements as of June 30, 2022:
Total
Quoted
Prices in
Active
Markets for
Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Joint Powers Authority Pools $ 131,756 $ 131,756 $ - $ - Mortgage Pass-Through Securities 33,108 - 33,108 -
Asset-Backed Securities 66,956 - 66,956 -
U.S. Treasury Obligations 191,127 - 191,127 -
Federal Agency Obligations 113,001 - 113,001 -
Medium-Term Corporate Notes 148,472 - 148,472 -
Supranational Securities 34,458 - 34,458 -
Negotiable Certificates of Deposits 3,973 - 3,973 -
Held by Fiscal Agent:
Asset-Backed Securities 3,503 - 3,503 -
U.S. Treasury Obligations 18,274 - 18,274 -
Federal Agency Obligations 3,208 - 3,208 -
Medium-Term Corporate Notes 10,745 - 10,745 -
Supranational Securities 3,566 - 3,566 -
Total 762,147 $ 131,756 $ 630,391 $ -
Investments not subject to
fair value hierarchy:
Local Agency Investment Fund 101,362
Mutual Funds 17,424
Money Market Mutual Funds 56,557
Investment Contracts 10,761
Total Investments $ 948,251
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 o f its fair value to changes in market interest rates. The City’s investment policy r equires that the interest rate risk exposure be managed by purchasing a combination of shorter term and longer term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity e venly o ver time as necessary t o provide the cash flow and liquidity n eeded for operations. 44 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Information about the sensitivity o f the fair values of the City’s investments (including investments held by fiscal agent) to market interest rate fluctuations is provided by t he following table that shows the distribution of the City’s investments by maturity:
Remaining Maturity (in Months)
Total
12 Months
or Less
13 to 36
Months
37 to 60
Months
More than
60 Months
Money Market Mutual Funds $ 23,482 $ 23,482 $ - $ - $ - Joint Powers Authority Pools 131,756 131,756 - - -
Local Agency Investment Fund 100,118 100,118 - - -
Mortgage Pass-Through Securities 33,108 9,231 19,278 4,599 - Asset-Backed Securities 66,956 - 35,914 31,042 -
U.S. Treasury Obligations 191,127 22,987 92,833 75,307 - Federal Agency Obligations 113,001 17,616 70,818 24,567 - Medium-Term Corporate Notes 148,472 6,807 66,728 74,937 - Supranational Securities 34,458 - 11,966 22,492 -
Negotiable Certificates of Deposit 3,973 3,973 - - -
Held by Fiscal Agent
Money Market Mutual Funds 33,075 33,075 - - -
Mutual Funds 17,424 17,424 - - -
Local Agency Investment Fund 1,244 1,244 - - -
Asset-Backed Securities 3,503 - 1,401 2,102 -
Investment Contracts 10,761 - - - 10,761
U.S. Treasury Obligations 18,274 5,994 4,938 7,342 -
Federal Agency Obligations 3,208 2,622 586 - -
Medium-Term Corporate Notes 10,745 - 6,665 4,080 -
Supranational Securities 3,566 - 1,687 1,879 -
Total $ 948,251 $ 376,329 $ 312,814 $ 248,347 $ 10,761
The City assumes that callable investments will not be called.
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 actual rating as of year-end for each investment type:
Ratings as of Year End *
Total AAA AA A Unrated
Money Market Mutual Funds $ 23,482 $ 18,309 $ - $ - $ 5,173 Joint Powers Authority Pools 131,756 - - - 131,756
Local Agency Investment Fund 100,118 - - - 100,118
Mortgage Pass-Through Securities 33,108 33,108 - - -
Asset-Backed Securities 66,956 53,315 - - 13,641
U.S. Treasury Obligations 191,127 191,127 - - -
Federal Agency Obligations 113,001 113,001 - - -
Medium-Term Corporate Notes 148,472 - 52,690 81,019 14,763 Supranational Securities 34,458 17,811 - - 16,647
Negotiable Certificates of Deposit 3,973 - - 3,973 -
Held by Fiscal Agent
Money Market Mutual Funds 33,075 10,722 - - 22,353
Mutual Funds 17,424 - - - 17,424
Local Agency Investment Fund 1,244 - - - 1,244
Asset-Backed Securities 3,503 2,869 - - 634
Investment Contracts 10,761 - - - 10,761
U.S. Treasury Obligations 18,274 18,274 - - -
Federal Agency Obligations 3,208 3,208 - - -
Medium-Term Corporate Notes 10,745 - 2,754 6,656 1,335
Supranational Securities 3,566 1,879 - - 1,687
Total $ 948,251 $ 463,623 $ 55,444 $ 91,648 $ 337,536
*Fitch rating used with "-" and "+" removed for simplicity Concentration on Credit Risk
The investment policy of the City contains no limitations on the amount that can be invested in any one issuer beyond that stated above. For fiscal year ended June 30, 2022, the City did not have any investments in any one issuer (other than U.S. Treasury s ecurities, money m arket funds, and external investment pools) that represent 5% or more of total City investments.
Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository f inancial institution, a government will not be able to recover its deposits 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 the 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 City’s 45 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
investment policy r equires that a third-party b ank trust department hold all securities owned by t he City. All trades are settled on a delivery vs. payment basis through the City’s safekeeping agent. The City h as no deposits with financial institutions; bank balances are swept daily i nto a money m arket account.
The pledge to secure deposits is administered by the California Commissioner of Business Oversight. Collateral is required for demand deposits at 110% of all deposits not covered by federal depository insurance (FDIC) if obligations of the United States and its agencies, or obligations of the State or its municipalities, school districts, and district corporations are pledged. Collateral of 150% is required if a deposit is secured by f irst mortgages or first trust deeds upon improved residential real property l ocated in California. All such collateral is considered to be held by the pledging financial institutions’ trust departments or agents in the name of the City. Obligations pledged to secure deposits must be delivered to an institution other than the institution in which the deposit is made; however, the trust department of the same institution may hold them.
Written custodial agreements are required to provide, among other things, that the collateral securities are held separate from the assets of the custodial institution.
Investment in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by C alifornia Government Code Section 16429 under the oversight of the Treasurer of the State of California. The fair value of the City’s investment in this pool is reported in the accompanying financial statements at amounts based upon the City’s pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio).
The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis.
4. Direct Financing Lease Receivable
The former Redevelopment Agency had a direct financing lease arrangement with the State of California (the State) for a twelve-story office building, which was transferred to the Successor Agency. The lease term is for thirty years and the State takes ownership of the facility at the conclusion of that term. The lease calls for semi-annual payments not less than the debt service owed on the related lease revenue bonds issued by the former Redevelopment Agency for the purchase and renovation of the building.
The future minimum lease payments to be received are as follows:
Fiscal Year
2023 $ 2,759
2024 2,786
2025 2,823
Total due 8,368
Less: amount applicable to interest (798)
Total direct financing lease receivable $ 7,570
46 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
5. Capital Assets and Right to Use Assets
The following is a summary o f changes in the capital assets during the fiscal year ended June 30, 2022:
Governmental Activities:
Beginning
Balance
Additions/
Transfers In
Deletions/
Transfers Out Reclassifications
Ending
Balance
Capital assets, not depreciated:
Land $ 376,616 $ 413 $ (242) $ - $ 376,787
Construction in progress 30,820 34,132 (748) (12,153) 52,051 Total capital assets, not
depreciated 407,436 34,545 (990) (12,153) 428,838
Capital assets, being depreciated:
Buildings 190,232 - - - 190,232
Improvements other than buildings 263,749 - - 7,634 271,383 Machinery and equipment 116,082 6,598 (2,607) 270 120,343 Intangibles, depreciable 219 - - - 219
Infrastructure 1,161,554 4,674 (284) 4,249 1,170,193
Total capital assets, being
depreciated 1,731,836 11,272 (2,891) 12,153 1,752,370
Less: accumulated depreciation
for:
Buildings (78,631) (4,875) - - (83,506)
Improvements other than buildings (156,433) (11,301) - - (167,734) Machinery and equipment (82,969) (7,752) 2,438 - (88,283) Intangibles, depreciable (219) - - - (219)
Infrastructure (483,920) (28,032) 284 - (511,668)
Total accumulated
depreciation (802,172) (51,960) 2,722 - (851,410)
Total capital assets being
depreciated, net 929,664 (40,688) (169) 12,153 900,960
Governmental Activities
capital assets, net $ 1,337,100 $ (6,143) $ (1,159) $ - $ 1,329,798 Right to use assets, being
amortized
Buildings - 1,159 - - 1,159
Machinery and equipment - 580 - - 580
Total right to use assets - 1,739 - - 1,739
Less accumulated amortization
Buildings - (542) - - (542)
Machinery and equipment - (145) - - (145)
Total right to use lease
accumulated
amortization - (687) - - (687)
Total right to use lease
assets, net - 1,052 - - 1,052
Capital assets and right to
use assets, net $ 1,337,100 $ (5,091) $ (1,159) $ - $ 1,330,850 Business-Type Activities:
Beginning
Balance
Additions/
Transfers In
Deletions/
Transfers Out Reclassifications
Ending
Balance
Capital assets, not depreciated:
Land $ 100,111 $ - $ - $ - $ 100,111
Intangible assets 21,626 - (131) - 21,495
Construction in progress 126,187 58,404 (250) (56,218) 128,123 Total capital assets, not
depreciated 247,924 58,404 (381) (56,218) 249,729
Capital assets, being depreciated:
Buildings 671,789 99 - 6,681 678,569
Improvements other than buildings 1,966,396 11,099 (12,170) 41,692 2,007,017 Machinery and equipment 108,099 2,481 (941) 3,859 113,498 Intangibles, depreciable 26,277 - - 3,986 30,263
Total capital assets, being
depreciated 2,772,561 13,679 (13,111) 56,218 2,829,347
Less: accumulated depreciation
for:
Buildings (198,313) (14,517) 1 - (212,829)
Improvements other than buildings (753,306) (49,832) 12,137 - (791,001) Machinery and equipment (75,387) (6,055) 938 - (80,504) Intangibles, depreciable (17,115) (2,806) 1 - (19,920)
Total accumulated
depreciation (1,044,121) (73,210) 13,077 - (1,104,254)
Total capital assets being
depreciated, net 1,728,440 (59,531) (34) 56,218 1,725,093 Business-Type activities
capital assets, net $ 1,976,364 $ (1,127) $ (415) $ - $ 1,974,822 Right to use assets, being
amortized
Land - 312 - - 312
Buildings - 348 - - 348
Machinery and equipment - 345 - - 345
Total right to use assets - 1,005 - - 1,005
Less accumulated amortization
Land - (74) - - (74)
Buildings - (75) - - (75)
Machinery and equipment - (78) - - (78)
Total right to use lease
accumulated
amortization - (227) - - (227)
Total right to use lease
assets, net - 778 - - 778
Capital assets and right to
use assets, net $ 1,976,364 $ (349) $ (415) $ - $ 1,975,600 47 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Depreciation expense was charged to various functions as follows:
Governmental Activities:
General government $ 3,953
Public safety 7,210
Highways and streets 28,686
Culture and recreation 11,370
Internal service funds 741
Total depreciation expense - Governmental
Activities $ 51,960
Business-Type Activities:
Electric $ 36,718
Water 16,179
Sewer 14,931
Airport 717
Refuse 837
Transportation 448
Public Parking 855
Civic Entertainment 2,525
Total depreciation expense -
Business-Type Activities $ 73,210
Amortization expense was charged to various functions as follows:
Governmental Activities:
General government $ 51
Public safety 328
Highways and streets 10
Culture and recreation 293
Internal service funds 5
Total amortization expense - Governmental
Activities $ 687
Business-type Activities:
Electric $ 134
Water 11
Sewer 4
Airport 1
Refuse 1
Transportation 2
Public Parking 74
Total amortization expense - Governmental
Activities $ 227
6. Leases
Leases Receivable
For the year ended June 30, 2022, the financial statements include the adoption of GASB Statement No. 87, Leases. The primary objective of this statement is to enhance the relevance and consistency o f information about governments' leasing activities. This statement establishes a single model for lease accounting based on the principle that leases are financings of the right to use an underlying asset. Under this statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources. For additional information, refer to the disclosures below.
The City of Riverside entered into 111 leases as a Lessor for the use of various pieces of land, building and equipment. The terms range from 2 to 110 years beginning on the contract commencement date. An initial lease receivable was recorded in the amount of $108,894. As of June 30, 2022, the value of the lease receivable is $104,795. The lessee was required to make monthly payments in fiscal year 2021-2022 ranging from $0 to $87. The leases have interest rates ranging from 0.52% to 1.79%. The various buildings and equipment estimated useful lifes range from 3 to 50 years. The value of the deferred inflow of resources as of June 30, 2022 w as $104,396, and the City r ecognized lease revenue of $4,497 during the fiscal year. The lessees have various extension options, ranging from 2 to 55 years.
Governmental Activities
Fiscal Year Principal Interest Total Payments
2023 $ 1,312 $ 91 $ 1,403
2024 1,261 76 1,337
2025 841 63 904
2026 768 53 821
2027 722 44 766
2028-2032 2,016 103 2,119
2033-2037 258 37 295
2038-2042 163 22 185
2043-2047 160 7 167
Total $ 7,501 $ 496 $ 7,997
48 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Business-Type Activities
Fiscal Year
Principal
Payments
Interest
Payments Total Payments
2023 $ 2,385 $ 1,670 $ 4,055
2024 1,923 1,650 3,573
2025 1,687 1,624 3,311
2026 1,512 1,602 3,114
2027 1,492 1,581 3,073
2028-2032 4,546 7,662 12,208
2032-2037 3,547 7,329 10,876
2038-2042 3,052 7,037 10,089
2042-2047 3,223 6,766 9,989
2048-2052 3,826 6,454 10,280
2053-2057 4,495 6,077 10,572
2058-2062 4,948 5,655 10,603
2063-2067 5,639 5,183 10,822
2068-2072 3,391 4,763 8,154
2073-2077 3,007 4,488 7,495
2078-2082 3,272 4,207 7,479
2083-2087 3,578 3,900 7,478
2088-2092 3,911 3,567 7,478
2093-2097 4,279 3,198 7,477
2098-2102 4,681 2,796 7,477
2103-2107 5,118 2,358 7,476
2108-2112 5,596 1,880 7,476
2113-2117 6,121 1,354 7,475
2118-2122 6,694 780 7,474
2123-2127 5,031 198 5,229
2128-2132 340 2 342
Total $ 97,294 $ 93,781 $ 191,075
Lease Liability
For the year ended June 30, 2022, the financial statements include the adoption of GASB Statement No. 87, Leases. The primary objective of this statement is to enhance the relevance and consistency o f information about governments' leasing activities. This statement establishes a single model for lease accounting based on the principle that leases are financings of the right to use an underlying asset. Under this statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources. For additional information, refer to the disclosures below.
The City o f Riverside h as entered into 163 l eases as Lessee for the use of various pieces of land, building and equipment. The terms range from 4.5 to 14 years beginning on the contract commencement date. An initial lease liability was recorded in the amount of $2,744. As of June 30, 2022, the value of the lease liability i s $1,847. The City o f Riverside w as required to make monthly payments in fiscal year 2021-2022 ranging from $0 to $24. The leases have an interest rate of 0.52%. The leases have various options to extend, ranging from 1 to 2 years. The value of the right-to-use asset as of June 30, 2022 of $2,744 with accumulated amortization of $914 and is included with Land, Building and Machinery and equipment on the Asset Class activities table found below.
Amount of Lease Assets by
Major Classes of Underlying
Asset
Asset Class
Lease Asset
Value
Accumulated
Amortization
Land $ 312 $ (74)
Buildings 1,507 (617)
Machinery and equipment 925 (223)
$ 2,744 $ (914)
Governmental Activities
Fiscal Year Principal Interest Total Payments
2023 $ 443 $ 4 $ 447
2024 380 2 382
2025 177 1 178
2026 60 - 60
Total $ 1,060 $ 7 $ 1,067
49 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Business-Type Activities
Fiscal Year
Principal
Payments
Interest
Payments Total Payments
2023 $ 223 $ 3 $ 226
2024 226 2 228
2025 223 1 224
2026 115 - 115
Total $ 787 $ 6 $ 793
7. Derivative Instruments
Interest Rate Swaps
The City has six cash flow hedging derivative instruments, which are pay-fixed swaps. These swaps were employed as a hedge against debt that was refunded in 2008 and 2011 and against debt issued in 2012. The balance of the deferral account for each swap is included as part of the deferred charge on refunding associated with the new bonds. The swaps were also employed as a hedge against the new debt. Hedge accounting was applied to that portion of the hedging relationship, which was determined to be effective. Hedge accounting was also applied to the swap associated with the debt issued in 2012, which was also determined to be effective.
The following is a summary of the derivative activity for the year ended June 30, 2022:
Notional
Amount
Fair Value
as of
06/30/22
Change in
Fair Value
for Fiscal
Year
Governmental Activities
2008 Renaissance Certificates of Participation* $ 59,133 $ (6,288) $ 6,830 Business-Type Activities
2008 Renaissance Certificates of Participation* 26,567 (2,726) 2,961 2008 Electric Refunding/Revenue Bonds Series A 32,450 (1,885) 2,847 2008 Electric Refunding/Revenue Bonds Series C 32,150 (3,495) 4,025 2011 Electric Refunding/Revenue Bonds Series A 35,550 (3,525) 4,191 2011 Water Refunding/Revenue Bonds Series A 24,050 (2,646) 3,037 2012 Convention Center Financing 27,809 269 2,158
* The 2008 Riverside Renaissance Certificates of Participation were distributed between Governmental Activities and Business-Type Activities to properly reflect thier proportional share.
Objective: In order to lower borrowing costs as compared to fixed-rate bonds, the City e ntered into interest rate swap agreements in connection with its $141,840 2008 Electric Revenue Bonds (Series A and C), $56,450 2011A Electric Revenue Bonds, $59,000 2011A Water Revenue Bonds and $128,300 2008 Certificates of Participation (“COP”). Also, in 2012, the City entered into an additional interest rate swap agreement in connection with the $41,650 Convention Center financing with BBVA Compass Bank.
Terms: Per the existing swap agreements, the City pays a counterparty a fixed payment and receives a variable payment computed as 62.68% of the London Interbank Offering Rate (“LIBOR”) one month index plus 12 basis points for the Electric and Water swaps. For the COP swap, the City pays a fixed payment and receives a variable payment computed as 63.00% of the LIBOR one-month index plus 7 basis points. The Convention Center financing consists of an initial 21-month variable rate interest only period during construction, which swaps to a fixed rate for the remaining 20-year amortization whereby the City will pay a fixed payment and will receive a variable payment computed at 65.01% of the LIBOR one month index plus 150 basis points. The notional value of the swaps and the principal amounts of the associated debt decline at a smaller rate until the debt is completely retired in fiscal year 2037.
The bonds and the related swap agreements for the 2008A Electric Revenue Bonds mature on October 1, 2029, 2008C Electric and 2011A Electric and 2011A Water Revenue/Refunding Bonds mature on October 1, 2035. The 2008 Certificates of Participation mature on March 1, 2037. The loan with BBVA Compass Bank will be paid in full on April 1, 2034.
As of June 30, 2022, rates were as follows:
2008 Electric
Refunding/
Revenue
Bonds
Series A
2008 Electric
Refunding/
Revenue
Bonds
Series C
2011 Electric
Refunding/
Revenue
Bonds
Series A
Rates Rates Rates
Interest rate swap:
Fixed payment to counterparty %3.11100 %3.20400 %3.20100 Variable payment from counterparty %(0.56374) %(0.56412) %(0.57863) Net interest rate swap payments %2.54726 %2.63988 %2.62237 Variable rate bond coupon payments %0.46162 %0.46205 %0.54311 Synthetic interest rate on bonds %3.00888 %3.10193 %3.16548 50 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
2011 Water
Refunding/
Revenue
Bonds
Series A
2008
Renaissance
COPs
2012
Convention
Center
Financing
Rates Rates Rates
Interest rate swap:
Fixed payment to counterparty %3.20000 %3.36200 %3.24000 Variable payment from counterparty %(0.55160) %(0.52389) %(2.05664) Net interest rate swap payments %2.64840 %2.83811 %1.18336 Variable rate bond coupon payments %0.53877 %0.48346 %2.05664 Synthetic interest rate on bonds %3.18717 %3.32157 %3.24000 Fair Value: As of June 30, 2022, in connection with all swap arrangements, the transactions had a combined net negative fair value of $20,296. Because the coupons on the City’s variable-rate bonds adjust to changing interest rates, the bonds do not have a corresponding fair value decrease. The fair value was developed by a p ricing service using the zero-coupon method. This method calculates the future net settlement payments required by the swap, assuming that the current forward rates implied by t he yield curve correctly a nticipate future spot interest rates. These payments are then discounted using the spot rates implied by the current yield curve for hypothetical zero-coupon bonds due on the date of each future net settlement of the swap.
Credit risk: The City i s not exposed to substantial credit risk because each swap, with the exception of the Convention Center Financing swap have a negative fair value. The swap counterparties, Bank of America, N.A., Merrill Lynch Capital Services, Inc., PNC Financial Services Group, Inc. and J.P.
Morgan Chase & Co. were rated A+, A-, A- and A- respectively by Standard & Poor’s. To mitigate the potential for credit risk for these swaps, the swap agreements require the fair value of the swap to be collateralized by t he counterparty w ith U.S. Government securities if the counterparties’ rating decreases to negotiated trigger points. Collateral would be posted with a third- party custodian. At June 30, 2022, there is no requirement for collateral posting for any of the outstanding swaps.
Basis risk: The City is exposed to basis risk on its pay-fixed interest rate swap and rate cap hedging derivative instruments because the variable-rate payments received by t he City o n these hedging derivative instruments are based on a rate or index other than interest rates the city pays on its hedged variable-rate debt. If a change occurs that results in the rates’ moving to convergence, the expected cost savings may not be realized.
Termination risk: The derivative contract uses the International Swap Dealers Association Master Agreement, which includes standard termination events, such as failure to pay and bankruptcy. The Schedule to the Master Agreement includes an “additional termination event.” That is, a swap may be terminated by the City i f either counterparty’s credit quality f alls below “BBB-" as issued by Standard and Poor’s. The City or the counterparty may terminate a swap if the other party f ails to perform under the terms of the contract. If a swap is terminated, the variable-rate bond would no longer carry a s ynthetic interest rate. Also, if at the time of termination, a swap has a negative fair value, the City would be liable to the counterparty for a payment equal to the swap’s fair value.
Swap payments and associated debt: As of June 30, 2022, the debt service requirements of the variable-rate debt and net swap payments assuming current interest rates remain the same, for their term are summarized in the following table. As rates vary, variable-rate bond interest payments and net swap payments will vary.
Variable-Rate Bonds
Fiscal Year Principal Interest
Interest Rate
Swaps, Net Total
2023 $ 8,468 $ 1,677 $ 6,296 $ 16,441
2024 7,504 1,603 6,110 15,217
2025 7,677 1,530 5,927 15,134
2026 14,671 1,432 5,607 21,710
2027 15,351 1,321 5,228 21,900
2028-2032 95,712 4,678 19,343 119,733
2033-2037 92,212 1,113 5,599 98,924
Total $ 241,595 $ 13,354 $ 54,110 $ 309,059
8. Letters of Credit
The City’s 2008 Certificates of Participation, 2008 Electric Revenue Bonds (Series A and C), and 2011 Electric Revenue Bonds (Series A) require an additional layer of security b etween the City a nd the purchaser of the bonds.
The City h as entered into the following letters of credit (“LOC”) in order to provide liquidity should all or a portion of the debt be optionally tendered to the remarketer without being successfully remarketed:
Debt Issue LOC Provider
LOC
Expiration
Date
Annual
Commitment
Fee
2008 Certificates of Participation Bank of America, N.A. 2023 0.470% 2008A Electric Revenue Bonds Barclays Bank, PLC 2024 0.395% 2008C Electric Revenue Bonds Barclays Bank, PLC 2024 0.395% 2011A Electric Revenue Bonds Bank of America, N.A. 2023 0.295% To the extent that remarketing proceeds are insufficient or not available, 51 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
tendered amounts will be paid from drawings made under an irrevocable direct- pay letter of credit.
Liquidity advances drawn against the LOC that are not repaid will be converted to an installment loan with principal to be paid quarterly not to exceed a 5-year period. The City would be required to pay annual interest equal to the highest of
8.0%, the Prime Rate plus 2.50%, the Federal Funds Rate plus 2.50% and 150% of the yield on the 30-year U.S. Treasury Bond. No amounts have ever been drawn against the four letters of credit due to a failed remarketing. The various indentures allow the City to convert the mode of the debt in the case of a failed remarketing.
On February 1 , 2019, the City e ntered into a subordinate letter of credit agreement with U.S. Bank, National Association. The Subordinate Letter of Credit is a tool approved through the Electric and Water Utility Five-Year Rate Plan to manage rate increases by enabling the Electric Utility and Water Utility to reduce cash levels while maintaining compliance with the Riverside Public Utilities Cash Reserve Policy. Under the terms and conditions of the agreement, the City m ay b orrow up to $35,000 for purposes of the capital or operating financial needs of the Electric System and $25,000 for purposes of the capital or operating financial needs of the Water System. There were no borrowings against the LOC as of June 30, 2022.
9. Long-Term Obligations
Changes in Long-Term Obligations:
Below is a summary of changes in long-term obligations during the fiscal year:
Governmental Activities:
Beginning
Balance Additions Reclass* Reductions
Ending
Balance
Due Within
One Year
General obligation bonds $ 6,478 $ - $ - $ (1,491) $ 4,987 $ 1,560 Pension obligation bonds 352,824 - - (14,560) 338,264 16,889 Certificates of participation 90,215 - - (4,738) 85,477 4,830 Lease revenue bonds 72,471 - - (3,616) 68,855 3,384
Direct borrowings:
Loans payable 457 - - (457) - -
Financed purchase 14,922 11,292 (694) (3,226) 22,294 3,495 $ 537,367 $ 11,292 $ (694) $ (28,088) $ 519,877 $ 30,158 * Unexpended lease proceeds were approved to be transferred from governmental activities to business-type activities for the purchase of vehicles
Business-Type Activities:
Beginning
Balance Additions Reclass* Reductions
Ending
Balance
Due Within
One Year
Revenue bonds $ 1,176,605 $ - $ - $ (37,505) $1,139,100 $ 33,445 Pension obligation bonds 116,227 - - (5,509) 110,718 7,010 Certificates of participation 27,213 - - (1,301) 25,912 1,330 Lease revenue bonds 7,059 - - (434) 6,625 457
Direct borrowings:
Notes payable 64,678 - - (4,730) 59,948 4,873
Contracts payable 1,067 - - (134) 933 150
Financed purchase 2,354 - 694 (872) 2,176 699
$ 1,395,203 $ - $ 694 $ (50,485) $1,345,412 $ 47,964
Governmental Activities:
General Obligation Bonds - Governmental Activities:
Principal
Outstanding
$20,000 Fire Facility P rojects, Election of 2003 General Obligation Bond; 3.0% to 5.5%, due in annual installments from $410 to $1,740 through August 1, 2024. $ 4,940
Add: unamortized bond premium 47
Total general obligation bonds $ 4,987
Remaining general obligation bond debt service payments will be made from unrestricted revenues of the General Fund. Annual debt service requirements to maturity are as follows:
Fiscal Year Principal Interest Total
2023 $ 1,560 $ 229 $ 1,789
2024 1,640 141 1,781
2025 1,740 48 1,788
Premium 47 - 47
Total $ 4,987 $ 418 $ 5,405
52 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Pension Obligation Bonds - Governmental Activities:
Principal
Outstanding
In 2018, the 2017 Taxable Pension Obligation Bonds were distributed between Governmental Activities, Business-Type Activities and the Successor Agency t o properly r eflect their proportional share. Pension Obligation bonds are not
collateralized by assets, nor do they constitute an obligation of the City o f Riverside whereby t he City i s obligated to levy o r pledge any form of taxation.
In 2020, the 2017 Taxable Pension Obligation Bonds
outstanding balances in the Successor Agency were distributed between Governmental Activities and Business-Type Activities. $89,540 California Statewide Community Development Authority (Public Safety) 2004 Taxable Pension Obligation Bond; 2.65% to
5.896%, due in annual installments from $1,125 to $10,715 through June 1, 2023. $ 10,715
$31,960 2017 Taxable Pension Obligation Bonds Series A;
1.25% to 3.125%, due in annual installments from $2,910 to $3,580 through June 1, 2027; $15,299 relates to Governmental Activities. 8,097
$432,165 2020 Taxable Pension Obligation Bonds Series A;
1.646% to 3.857% due in annual installments from $2,920 to $28,310 through June 1, 2045. $324,582 relates to
Governmental Activities 319,644
Subtotal 338,456
Less: unamortized bond discount (192)
Total pension obligation bonds $ 338,264
Remaining pension obligation bond debt service payments will be made from unrestricted revenues of the General Fund. Annual debt service requirements to maturity are as follows:
Fiscal Year Principal Interest Total
2023 $ 16,889 $ 12,284 $ 29,173
2024 7,623 11,523 19,146
2025 9,840 11,353 21,193
2026 9,884 11,123 21,007
2027 10,966 10,868 21,834
2028-2032 62,782 49,523 112,305
2033-2037 103,829 35,018 138,847
2038-2042 94,720 14,511 109,231
2043-2047 21,923 1,383 23,306
Discount (192) - (192)
Total $ 338,264 $ 157,586 $ 495,850
Certificates of Participation – Governmental Activities:
Principal
Outstanding
In 2019, the 2008 Riverside Renaissance Certificates of Participation were distributed between Governmental Activities and Business-Type Activities to properly reflect their proportional share.
$19,945 2006 Galleria at Tyler Public Improvements Certificates of Participation are secured with collateral of the two level 912 space parking structure located near Tyler Street and Nordstrom store, the Tyler Mall North Plaza, the North Plaza parking, storm drains related to those improvements, and portions of two arterial streets; 4.0% to 5.0%, due in annual installments from $435 to $1,270 through September 1, 2036. $ 5
$128,300 2008 Riverside Renaissance Certificates of
Participation are secured with collateral of the Adulka Park, Fairmount Park and Golf Course, Arlington Heights Sports Park, Orange Terrace Park, Orange Terrace Community Center and Orange Terrace Library; issued at a variable rate; however, the City e ntered into an agreement to convert to a fixed rate of
3.4%. For information on the swap agreement see Note 6. Due in annual installments from $2,900 to $7,200 through March 1, 2037; $71,159 relates to Governmental Activities. 59,788 53 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
$35,235 2013 Pavement Rehab Certificates of Participation are secured by Measure A Sales Tax receipts; 4.0% to 5.0%, due in annual installments from $1,285 to $2,855 through June 1, 2033. 24,985
Subtotal 84,778
Plus: unamortized bond premium 699
Total certificates of participation $ 85,477
Remaining Certificates of Participation debt service payments will be made from unrestricted revenues of the Debt Service Fund. Annual debt service requirements to maturity are as follows:
Fiscal Year Principal Interest Total
2023 $ 4,830 $ 3,223 $ 8,053
2024 5,054 3,031 8,085
2025 5,224 2,826 8,050
2026 5,463 2,612 8,075
2027 5,713 2,389 8,102
2028-2032 32,123 8,437 40,560
2033-2037 26,371 2,371 28,742
Premium 699 - 699
Total $ 85,477 $ 24,889 $ 110,366
Lease Revenue Bonds - Governmental Activities:
Principal
Outstanding
In 2019, the Series 2012A Lease Revenue Refunding Bonds were distributed between Governmental Activities, Business- Type Activities, and Successor Agency t o properly r eflect their proportional share.
On August 15, 2012, the City i ssued the Series 2012A Lease Revenue Refunding Bonds in the amount of $41,240. T he bonds are secured by lease payments on a portion of the City Hall Complex and the Lincoln Police Patrol Center. The bonds were issued to refinance the 2003 Certificates of Participation.
Interest on the bonds is payable semi-annually o n May 1 a nd November 1 of each year, commencing May 1, 2013. The rate of interest varies from 2% to 5% per annum d epending on maturity d ate. P rincipal is payable in annual installments ranging from $1,295 to $2,840 commencing November 1, 2013 and ending November 1, 2033. I n the event of default, the Trustee may retain the Lease Agreement and hold the City liable for all Base Rental Payments on an annual basis. The rental payments may not be accelerated. $23,683 relates to
Governmental Activities. $ 19,038
$15,980 2019A Lease Revenue Refunding Bonds (Galleria at Tyler Public Improvements) are secured by lease payments on the two level 912 space parking structure located near Tyler Street and Nordstrom store, the Tyler Mall North Plaza, the North Plaza parking, storm drains related to those
improvements, and portions of two arterial streets. The bonds were issued to refinance all but $5 of the outstanding 2006 Lease Revenue Certificates of Participation (Galleria at Tyler Public Improvements); 2.75% to 4.0%, due in annual
installments from $605 to $1,180 through November 1, 2036.
The refunding transaction resulted in a total net present value savings of $1,140. In the event of default, the Trustee may retain the Lease Agreement and hold the City liable for all Base Rental Payments on an annual basis. The rental payments may not be accelerated. 13,960
54 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
$33,505 2019B Lease Revenue Refunding Bonds (Main Library Project); 3.0% to 5.0%, due in annual installments from $1,245 to $2,645 through November 1, 2036. The bonds are secured by an amendment to the Ground Lease entered into by t he City upon issuance of the 2012A Lease Revenue Bonds. It adds the remainder of the City H all Complex, the Corporation Yard Administration Building and annex, Bobby Bonds Park, and the Main Library site. In the event of default, the Trustee may retain the Lease Agreement and hold the City liable for all Base Rental Payments on an annual basis. The rental payments may not be accelerated. 28,810
Subtotal 61,808
Add: unamortized bond premium 7,047
Total lease revenue bonds $ 68,855
Remaining lease revenue bond debt service payments will be made from unrestricted revenues of the Debt Service Fund. Annual debt service requirements to maturity are as follows:
Fiscal Year Principal Interest Total
2023 $ 3,384 $ 2,700 $ 6,084
2024 3,539 2,542 6,081
2025 3,588 2,389 5,977
2026 3,733 2,242 5,975
2027 3,896 2,078 5,974
2028-2032 22,308 7,472 29,780
2033-2037 21,360 2,282 23,642
Premium 7,047 - 7,047
Total $ 68,855 $ 21,705 $ 90,560
Business-Type Activities:
The following debt has been issued for the purpose of generating capital resources for use in acquiring or constructing municipal facilities or infrastructure projects.
Revenue Bonds - Business-Type Activities:
Principal
Outstanding
Electric
All electric revenue bonds are covenanted per the Amended and Restated Resolution No. 17662 (Electric) Master Resolution that upon the occurrence and continuation of an event of default, the owners of 25% in aggregate amount of Bond Obligation may, by written notice to the City, declare the entire unpaid principal and accreted value of the bonds due and payable should the City fail to pay its debts as they b ecome due or upon the entry of any decree or order of bankruptcy of the City.
$141,840 2008 Electric Refunding/Revenue Bonds; Series A & C. The bonds were issued at a variable rate; however, the City entered into an agreement to convert to a fixed rate of 3.1% and
3.2% for the Series A & C bonds, respectively. See Note 6 for information on the swap agreements. Bonds are due in annual installments from $700 to $7,835 through October 1, 2035. In 2019, the Electric Fund refunded $40,425 of the outstanding balance. $ 66,615
$140,380 2010 Electric Revenue Bonds fixed rate bonds, 3% to
7.65%, due in annual installments from $95 to $33,725 through October 1, 2040. 128,600
55 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
$56,450 2011 Electric Revenue Refunding Bonds; Series A.
The bonds were issued at a variable rate; however, the City entered into an agreement to convert to a fixed rate of 3.2%.
For information on the swap agreements see Note 6. Bonds are due in annual installments from $725 to $5,175 through October 1, 2035. Upon event of default, the bank may declare the outstanding amount of the obligations payable to be due immediately. D uring fiscal year 2019-20, the bonds originally issued as private placement bonds were remarketed as public securities in order to obtain a lower rate. The structure is the same and the existing swap is the same. 35,550
$79,080 2013 Electric Revenue Refunding Bonds; Series A fixed rate bonds, 3% to 5.25%, due in annual installments from $795 to $12,685 through October 1, 2043. 36,355
$283,325 2019 Electric Refunding/Revenue Bonds; Series A, fixed rate bonds, 5.0%, due in annual installments from $3,545 to $24,005 through October 1, 2048. The bonds refunded the 2008 Electric Revenue Bonds Series D and partially r efunded the 2008 Electric Revenue Bonds Series A and C. The refunding transactions resulted in a total net present value savings of $36,810. 257,010
Subtotal 524,130
Add: Unamortized bond premium 45,055
Subtotal - Electric 569,185
Water
All water revenue bonds are covenanted per the Amended and Restated Resolution No. 17664 (Water) Master Resolution that upon the occurrence and continuation of an event of default, the owners of 25% in aggregate amount of Bond Obligation may, by written notice to the City, declare the entire unpaid principal and accreted value of the bonds due and payable should the City fail to pay its debts as they b ecome due or upon the entry of any decree or order of bankruptcy of the City.
$67,790 2009 Water Revenue Bonds; Series B fixed rate bonds,
5.1% to 6.3%, due in annual installments from $2,475 to $4,985 through October 1, 2039. 65,315
$59,000 2011 Water Refunding/Revenue Bonds; Series A. The bonds were issued at a variable rate; however, the City entered into an agreement to convert to a fixed rate of 3.2%. F or information on the swap agreements see Note 6. B onds are due in annual installments from $600 to $3,950 through October 1, 2035. 24,050
$114,215 2019 Water Refunding/Revenue Bonds; Series A,
fixed rate bonds, 5.0%, due in annual installments from $1,680 to $8,455 through October 1, 2048. T he bonds refunded the 2008 Water Revenue Bonds Series B and partially refunded and partially unwound the swap on the 2011 Water Revenue Bonds Series A. The refunding transactions resulted in a total net present value savings of $10,759. 102,825
Subtotal 192,190
Add: Unamortized bond premium 17,472
Subtotal - Water 209,662
Sewer
All sewer revenue bonds are covenanted per Resolution No. 21860 Sewer Master Resolution that upon the occurrence and continuation of an event of default, the owners of 25% in aggregate amount of Bond Obligation may, by written notice to the City, declare the entire unpaid principal and accreted value of the bonds due and payable should the City fail to pay its debts as they become due or upon the entry of any decree or order of bankruptcy of the City.
$200,030 2015 Sewer Revenue Bonds; Series A fixed rate
bonds, 4% to 5%, due in annual installments from $4,790 to $14,175 through August 1, 2040. 179,430
$153,670 2018 Sewer Revenue Bonds; Series A fixed rate
bonds, 4% to 5%, due in annual installments from $2,905 to $11,775 through August 1, 2039. T he bonds advanced
refunded the 2009 Direct Pay B uild America Bonds Series B.
The refunding transaction resulted in a total net present value savings of $18,932. 143,425
Subtotal 322,855
56 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Add: unamortized bond premium 37,398
Subtotal - Sewer 360,253
Total revenue bonds $ 1,139,100
Remaining revenue bond debt service payments will be made from revenues of the Electric, Water and Sewer Enterprise funds. Annual debt service requirements to maturity are as follows:
Electric
Fiscal Year Principal Interest Total
2023 $ 16,760 $ 24,174 $ 40,934
2024 17,515 23,362 40,877
2025 18,335 22,488 40,823
2026 19,305 21,580 40,885
2027 20,085 20,742 40,827
2028-2032 114,035 89,670 203,705
2033-2037 134,560 61,860 196,420
2038-2042 145,000 26,022 171,022
2043-2047 27,800 5,888 33,688
2048-2052 10,735 543 11,278
Premium 45,055 - 45,055
Total $ 569,185 $ 296,329 $ 865,514
Water
Fiscal Year Principal Interest Total
2023 $ 6,915 $ 8,491 $ 15,406
2024 7,215 8,167 15,382
2025 7,540 7,823 15,363
2026 7,875 7,463 15,338
2027 8,230 7,086 15,316
2028-2032 46,560 29,339 75,899
2033-2037 55,870 18,635 74,505
2038-2042 36,165 6,658 42,823
2043-2047 10,735 2,665 13,400
2048-2052 5,085 257 5,342
Premium 17,472 - 17,472
Total $ 209,662 $ 96,584 $ 306,246
Sewer
Fiscal Year Principal Interest Total
2023 $ 9,770 $ 15,669 $ 25,439
2024 11,460 15,139 26,599
2025 12,050 14,551 26,601
2026 12,670 13,933 26,603
2027 13,320 13,283 26,603
2028-2032 77,560 55,443 133,003
2033-2037 99,540 33,468 133,008
2038-2042 86,485 7,850 94,335
Premium 37,398 - 37,398
Total $ 360,253 $ 169,336 $ 529,589
Pension Obligation Bonds - Business Type Activities:
Principal
Outstanding
In 2018, the 2017 Taxable Pension Obligation Bonds were distributed between Governmental Activities, Business-Type Activities, and the Successor Agency t o properly r eflect their proportional share. Pension Obligation Bonds are not
collateralized by assets, nor do they constitute a debt of the City of Riverside whereby the City is obligated to levy or pledge any form of taxation.
In 2020, the 2017 Taxable Pension Obligation Bonds
outstanding balances in the Successor Agency were distributed between Governmental Activities and Business-Type Activities. $31,960 2017 Taxable Pension Obligation Bonds Series A;
1.25% to 3.125%, due in annual installments from $2,910 to $3,580 through June 1, 2027. $16,661 relates to Business Type Activities. $ 8,818
$432,165 2020 Taxable Pension Obligation Bonds Series A;
1.646% to 3.857% due in annual installments from $2,920 to $28,310 through June 1, 2045. $107,583 relates to Business- Type Activities. 101,900
Total pension obligation bonds $ 110,718
57 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Remaining pension obligation bond debt service payments will be made from unrestricted revenues of the Business-Type Activities funds. Annual debt service requirements to maturity are as follows:
Fiscal Year Principal Interest Total
2023 $ 7,010 $ 3,488 $ 10,498
2024 8,457 3,342 11,799
2025 9,365 3,153 12,518
2026 9,636 2,932 12,568
2027 9,244 2,683 11,927
2028-2032 23,498 10,692 34,190
2033-2037 25,786 10,692 36,478
2038-2042 17,035 1,831 18,866
2043-2047 687 27 714
Total $ 110,718 $ 38,840 $ 149,558
Certificates of Participation – Business Type Activities:
Principal
Outstanding
In 2019, the 2008 Riverside Renaissance Certificates of Participation were distributed between Governmental Activities and Business-Type Activities to properly reflect their proportional shares.
$128,300 2008 Riverside Renaissance Certificates of
Participation are secured with collateral of the Andulka Park, Fairmount Park and Golf Course, Arlington Heights Sports Park, Orange Terrace Park, Orange Terrace Community Center, and Orange Terrace Library; issued at a variable rate; however, the City e ntered into an agreement to convert to a fixed rate of
3.4%. For information on the swap agreement see Note 6. Due in annual installments from $2,900 to $7,200 through March 1, 2037; $30,841 relates to the Civic Entertainment Fund. $ 25,912 Total certificates of participation $ 25,912
Remaining certificates of participation debt service payments will be made from unrestricted revenues of the Civic Entertainment Fund. Annual debt service requirements to maturity are as follows:
Fiscal Year Principal Interest Total
2023 $ 1,330 $ 860 $ 2,190
2024 1,391 815 2,206
2025 1,421 768 2,189
2026 1,482 719 2,201
2027 1,542 669 2,211
2028-2032 8,557 2,525 11,082
2033-2037 10,189 965 11,154
Total $ 25,912 $ 7,321 $ 33,233
Lease Revenue Bonds – Business Type Activities:
Principal
Outstanding
In 2019, the Series 2012A Lease Revenue Refunding Bonds were distributed between Governmental Activities, Business- Type Activities, and the Successor Agency t o properly r eflect their proportional share.
On August 15, 2012, the City i ssued the Series 2012A Lease Revenue Refunding Bonds in the amount of $41,240. The bonds are secured by l ease payments on a portion of the City H all Complex and the Lincoln Police Patrol Center. The bonds were issued to refinance the 2003 Certificates of Participation.
Interest on the bonds is payable semi-annually o n May 1 a nd November 1 of each year, commencing May 1, 2013. The rate of interest varies from 2% to 5% per annum d epending on maturity d ate. P rincipal is payable in annual installments ranging from $1,295 to $2,840 commencing November 1, 2013 and ending November 1, 2033. In the event of default, the Trustee may retain the Lease Agreement and hold the City liable for all Base Rental Payments on an annual basis. The rental payments may not be accelerated. $8,242 relates to
Governmental Activities. $ 6,625
Total lease revenue bonds $ 6,625
58 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Remaining lease revenue bond debt service payments will be made from unrestricted revenues of the Parking Fund. Annual debt service requirements to maturity are as follows:
Fiscal Year Principal Interest Total
2023 $ 457 $ 280 $ 737
2024 480 256 736
2025 466 236 702
2026 481 220 701
2027 502 199 701
2028-2032 2,902 594 3,496
2033-2037 1,337 54 1,391
Total $ 6,625 $ 1,839 $ 8,464
The following are legally required debt service cash reserves. These amounts, at a minimum, are held by the City or fiscal agents at June 30, 2022:
Governmental Long-Term Obligations:
Certificates of participation $ 7,423
Total $ 7,423
Enterprise Funds:
Electric 10,801
Total $ 10,801
The City has a number of debt issuances outstanding that are collateralized by the pledging of certain revenues. The amount and term of the remainder of these commitments are indicated in the debt service to maturity t ables presented in the accompanying notes. The purposes for which the proceeds of the related debt issuances were utilized are disclosed in the debt descriptions in the accompanying notes. For the current year, debt service payments as a percentage of the pledged gross revenue (or net of certain expenses where so required by t he debt agreement) are indicated in the table below. The debt service coverage ratios also approximate the relationship of debt service to pledged revenue for the remainder of the term of the commitment.
Description of
Pledge Revenue
Annual Amount of
Pledge Revenue
(net of expenses,
where required)
Annual Debt Service
Payments (all of
debt secured by
this revenue)
Coverage
Ratio
for FY
06/30/22
Electric revenues $ 93,639 * $ 46,028 2.03
Water revenues 37,986 * 17,068 2.23
Sewer revenues 39,782 26,541 1.50
*Excludes non-cash pension expense
There are also a number of limitations and restrictions contained in Assessment Bond indentures. The City b elieves they a re in compliance with all significant limitations and restrictions.
Direct Borrowings: Notes Payable - Business-Type
Activities:
Principal
Outstanding
Notes payable consists of several agreements with Hillwood Enterprises, L.P. and related entities (collectively H illwood) for their development of logistic centers located in the City of San Bernardino. As part of these agreements, the Water Fund leases land to Hillwood and also purchased land from Hillwood with a subsequent lease-back to the entity. In addition, the agreements require Hillwood to relocate wells located on the properties as well as terminate an existing lease. In
consideration of the cost of the land purchase, well relocations and lease termination, the Water Fund will make payments to Hillwood in the form of a credit with Hillwood’s rental payments to the Water Fund for the first 15 years of the leases. $ 16,639 Public Parking Fund and Civic Entertainment Fund loan for Fox Entertainment Plaza project secured with collateral of the Fox Theater, Fox Entertainment Plaza, and Parking Garage No. 7.
3.85%, payable in net annual installments of $1,747, beginning June 16, 2011 through December 16, 2031. In the event of default, the City would continue to remain liable for the payment of Rental Payments and damages for breach of the Lease. 13,788 59 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
In July 1 9, 2012, the City s ecured financing in the amount of $41,650 with BBVA Compass Bank for the renovation and
expansion of the Riverside Convention Center (Civic
Entertainment Fund) secured with collateral of the convention center facility. In March 2014, the financing arrangement with BBVA was increased to $44,650. The financing consists of an initial 21-month variable rate interest only p eriod during construction that has a swap transaction layered over the remaining 20-year amortization resulting in a “synthetic fixed” rate of 3.24% for 20 of the 22 years. F or information on the swap agreement see Note 6. A t the end of the construction period, principal and interest are due on the first of each month, with equal payments each year of approximately $2,850. In the event of default, the outstanding amount of the site lease payment drawn by the City and not repaid will bear interest at a default rate that will be charged until the default is cured. 29,521 Total notes payable $ 59,948
Remaining notes payable debt service payments will be made from unrestricted revenues of the Water Fund, Public Parking Fund, and Civic Entertainment Fund. Annual debt service requirements to maturity are as follows:
Water
Fiscal Year Principal Interest Total
2023 $ 1,535 $ 436 $ 1,971
2024 1,624 392 2,016
2025 1,719 346 2,065
2026 1,818 296 2,114
2027 1,923 242 2,165
2028-2032 7,507 411 7,918
2033-2037 513 4 517
Total $ 16,639 $ 2,127 $ 18,766
Non-Major Enterprise Funds
Fiscal Year Principal Interest Total
2023 $ 3,338 $ 1,439 $ 4,777
2024 3,446 1,322 4,768
2025 3,568 1,200 4,768
2026 3,688 1,075 4,763
2027 3,811 945 4,756
2028-2032 20,209 2,623 22,832
2033-2037 5,249 149 5,398
Total $ 43,309 $ 8,753 $ 52,062
Direct Borrowings: Contracts Payable
Principal
Outstanding
Water stock acquisition rights payable on demand to various water companies $ 933
Direct Borrowings: Financed Purchase
The City purchased various equipment through financing arrangements in the governmental and proprietary fund types. These activities are recorded for both governmental and business-type activities in the government-wide financial statements. The assets and related obligations in governmental funds are not recorded in the fund statements. For proprietary f unds, the assets and their related liabilities are reported directly i n the fund. Amortization applicable to proprietary a ssets acquired through financing arrangements is included with depreciation for financial statement presentation.
60 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
The assets acquired through financing arrangements are as follows:
Asset
Governmental
Activites
Business-Type
Activities
Buildings and improvements $ 1 $ -
Machinery and equipment 23,356 8,006
Subtotal 23,357 8,006
Less: Accumulated depreciation (9,527) (6,066)
Total $ 13,830 $ 1,940
The future minimum obligations as of June 30, 2022 were as follows:
Fiscal Year
Governmental
Activities
Business-Type
Activities
2023 $ 3,931 $ 741
2024 3,838 375
2025 3,838 375
2026 2,742 375
2027 2,742 375
Thereafter 6,943 57
Total minimum installments 24,034 2,298
Less: Amount representing interest
(rates ranging from 1.2% to 9%) (1,740) (122)
Total financed purchase $ 22,294 $ 2,176
10. Compensated Absences
A liability i s recorded for unused vacation and similar compensatory l eave balances since the employees’ entitlement to these balances are attributable to services already rendered and it is probably that virtually all of these balances will be liquidated by e ither paid time-off or payments upon termination or retirement.
Below is a summary o f changes in compensated absences during the fiscal year:
Governmental Activities:
Beginning
Balance Additions Reductions
Ending
Balance
Due
Within
One Year
Compensated absences $ 30,899 $ 16,205 $ (17,110) $ 29,994 $ 16,600 Business-Type Activities:
Beginning
Balance Additions Reductions
Ending
Balance
Due
Within
One Year
Compensated absences $ 12,005 $ 8,366 $ (8,516) $ 11,855 $ 8,402
11. Risk Management
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. Property insurance coverage has a limit of $1,000,000, with a deductible of $100. Earthquake and flood insurance coverage has a limit of $25,000, with a deductible of 5% (subject to $100 minimum for earthquake and $100 for flood). Workers’ compensation insurance coverage has a limit of $25,000, with a self-insured retention of $3,000. The City h as four General Liability policies: a primary and and three excess General Liability policies. The primary General Liability policy coverage has a limit of $4,000 and the Excess General Liability policies provide an additional $21,000 of coverage, with a self- insured retention of $3,000. Both the primary a nd excess General liability policies cover general and auto liability claims including but not limited to Law Enforcement Liability a nd Public Officials Errors and Ommissions. There has been one claim settled in the last three fiscal years that exceed insurance coverage. Internal service funds have been established to account for and finance the uninsured risks of loss.
All funds of the City p articipate in the Risk Management program and make payments to the Internal Service Funds based on actuarial estimates of the amounts needed to fund prior and current year claims and incidents that have been incurred but not reported. Interfund premiums are accounted for as quasi- external transactions and are therefore recorded as revenues of the Internal Service Funds in the fund financial statements.
Changes in the self-insurance fund’s claims and judgments amounts are:
Governmental Activities:
Beginning
Balance Additions Reductions
Ending
Balance
Due
Within
One Year
Claims and judgments $ 76,603 $ 13,134 $ (10,947) $ 78,790 $ 15,304 61 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Unpaid claims, June 30,2020 $ 53,828
Incurred claims (including IBNR's) 35,818
Claim payments and adjustments (13,043)
Unpaid claims, June 30,2021 76,603
Incurred claims (including IBNR's) 13,134
Claim payments and adjustments (10,947)
Unpaid claims, June 30,2022 $ 78,790
12. Landfill Capping
State and Federal laws and regulations require the City to place a final cover on all active landfills when closed and to perform certain maintenance and monitoring functions at the landfill site for 30 years after closure. To comply with these laws and regulations, the City is funding the costs of closure and "final capping" of the Tequesquite landfill located in the City. This area, comprised of approximately 1 20 acres, operated as a "Class II Sanitary L andfill" until its closure in 1985. During its operation, the landfill did not accept hazardous waste and no clean up and abatement or cease and desist orders have been issued to the City. The capacity used at June 30, 2022 was 100%. The remaining post closure period is currently 20 years.
The estimated costs as determined and updated by t he Public Works Department are associated with flood control upgrades, remediation of possible ground water contamination and control of methane gas. All potential costs have been recognized in the financial statements. However, there is the potential for these estimates to change due to inflation, deflation, technology, or change in laws or regulations. The City i s recovering such costs in rates charged to its customers. The portion of costs to be recovered through future rates is classified as a regulatory a sset and will be amortized over future periods.
Below is a summary of changes in landfill capping liability during the fiscal year:
Business-Type Activities:
Beginning
Balance Additions Reductions
Ending
Balance
Due
Within
One Year
Landfill capping $ 10,419 $ - $ (599) $ 9,820 $ 559
13. Nuclear Decommissioning Liability
As of June 30, 2022, decommissioning liability b alance was $53,310 w ith a portion reflected as current liabilities payable from restricted assets. As a result of the updated SCE decommissioning cost estimate and the increase in the Electric Utility's estimated share, the decommissioning liability was increased by $5.7 million in fiscal year 2021/22. The offset of this liability increase has been recorded as an extraordinary item in fiscal year 2021/22. See Note 1 and 26 for additional information. Due to adequate funding of the liability, the Electric Utility no longer provides additional funding to the trustee. However, since the decommissioning cost estimate is subject to a number of uncertainties including the cost of disposal of nuclear waste, site remediation costs, as well as a number of other assumptions and estimates, the Electric Utility will continue to set aside funds in the designated decommissioning reserve of $2,000 per year, as approved by the Board of Public Utilities and City Council.
Below is a summary o f changes in decommissioning liability d uring the fiscal year:
Business-Type Activities:
Beginning
Balance Additions Reductions
Ending
Balance
Due
Within
One Year
Decommissioning liability $ 50,896 $ 6,555 $ (4,141) $ 53,310 $ 8,813
14. Commitments and Contingencies
Intermountain Power Agency
The Electric Utility h as a power purchase contract with Intermountain Power Agency (IPA) for the delivery of electric power. The Electric Utility’s share of IPA power is equal to 7.6 percent, or approximately 137.1 MW, of the net generation output of IPA’s 1,800 MW central Utah coal-fueled generating station, known as Intermountain Power Project (IPP). The contract expires in 2027 and the debt fully matures in 2024.
The contract constitutes an obligation of the Electric Utility to make payments solely f rom operating revenues. The power purchase contract requires the Electric Utility to pay certain minimum charges that are based on debt service requirements and other fixed costs. Such payments are considered a cost of production.
On September 29, 2006, Senate Bill 1368 (SB 1368) was enacted into law. The bill requires electric service providers to limit financial investments in power plants to those that adhere to greenhouse gas performance standards as determined by the Public Utilities Commission. Pursuant to this legislation, the Electric Utility is prohibited from renewing its participation in IPP if it remains a coal fueled generating resource.
In order to facilitate the continued participation in the IPP, the IPA Board issued the Second Amendatory P ower Sales Contract, which amended the IPP Contract allowing the plant to replace the coal units with combined cycle natural 62 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
gas units by July 1, 2025. On June 16, 2015, the City Council approved the IPP renewal agreements, including the Second Amendatory Power Sales Contract and the Renewal Power Sales Contract, and authorized participation in the IPP Repower Project for up to 5 percent in generation capacity o r 60MW. The Second Amendatory Power Sales Contract became effective March 16, 2016.
On January 5 , 2017, the Electric Utility e xecuted the Renewal Power Sales Contract and the Electric Utility accepted an offer of 4.167 percent entitlement or 50 MW generation capacity in the IPP Repower Project based on the 1,200 MW d esigned capacity, which is within the maximum participation level approved by t he City C ouncil. The Electric Utility’s corresponding Southern Transmission System allocation is 5.278 percent or approximately 1 27 MW.
Further, under the Renewal Power Sales Contract, the Electric Utility h ad the right to exit from the Repower Project by no later than November 1, 2019, if it is determined that the Repower Project is not cost beneficial to its customers.
On September 11, 2018, the City Council approved “Alternative Repowering” of the IPP Repower Project, which reduced the design capacity of the future plant from 1,200 MW to 840 MW.
On May 7, 2019, the City Council authorized termination of the Renewal Power Sales Contract between the IPA and the Electric Utility effective November 1, 2019, and the Electric Utility’s exit from the IPP Repower Project upon the expiration date of the current Power Sales Contract on June 15, 2027, due to numerous uncertainties surrounding the IPP Repower Project.
The Electric Utility i s a member of the Southern California Public Power Authority ( SCPPA), a joint powers agency. SCPPA provides for the financing and construction of electric generating and transmission projects for participation by s ome or all of its members. To the extent the Electric Utility participates in take-or-pay p rojects developed by S CPPA, it has entered into Power Purchase or Transmission Service Agreements, entitling the Electric Utility t o the power output or transmission service, as applicable, and the Electric Utility w ill be obligated for its proportionate share of the project costs whether or not such generation output of transmission service is available.
The projects and the Electric Utility’s proportionate share of SCPPA’s obligations, including final maturities and contract expirations are as follows:
Project
Percent
Share Entitlement
Final
Maturity
Contract
Expiration
Palo Verde Nuclear Generating Station %5.40 12.3 MW 2017 2030 Southern Transmission System %10.20 244.0 MW 2027 2027
Mead-Phoenix Transmission %4.00 18.0 MW 2020 2030
Mead-Adelanto Transmission %13.50 118.0 MW 2020 2030
Terms of Take or Pay Commitments
As part of the take-or-pay commitments with IPA and SCPPA, the Electric Utility has agreed to pay its share of current and long-term obligations. Management intends to pay t hese obligations from operating revenues received during the year that payment is due. A long-term obligation has not been recorded on the accompanying financial statements for these commitments. Take-or-pay commitments terminate upon the later of contract expiration or final maturity of outstanding bonds for each project.
The outstanding debts associated with the take-or-pay o bligations have fixed interest rates, which range from 4.00 percent to 5.00 percent. The schedule below details the amount of principal and interest that is due and payable by the Electric Utility as part of the take-or-pay contract for each project in the fiscal year indicated.
IPA1 SCPPA Total
Debt Service
Payment Year
Ending June 30,
Intermountain
Power Project
Southern
Transmission
System
All
Projects
2023 $ 7,285 $ 7,083 $ 14,368
2024 3,472 7,125 10,597
2025 2,990 3,261 6,251
2026 2,990 3,257 6,247
2027 4,800 6,508 11,308
Total $ 21,537 $ 27,234 $ 48,771
1 The Electric Utility's contract with IPA expires in 2027. The Electric Utility will not be responsible for the proportionate share of the 2022 Series A & B Revenue bonds after the contract expires.
In addition to debt service, the Electric Utility’s entitlements require the payment of fuel costs, operating and maintenance, administrative and general and other miscellaneous costs associated with the generation and transmission facilities discussed above. These costs do not have a similar structured payment schedule as debt service and vary each year. The costs incurred for the years ended June 30, 2022 and 2021, are as follows:
63 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Fiscal Year
Intermountain
Power Project*
Palo Verde
Nuclear
Generating
Station*
Southern
Transmission
System
Mead-Phoenix
Transmission
Mead-Adelanto
Transmission All Projects
2022 $ 19,522 $ 2,930 $ 4,400 $ 57 $ 415 $ 27,324
2021 20,648 2,951 5,126 44 424 29,193
* Excludes variable costs
These costs are included in production and purchased power or transmission expense on the Statements of Revenues, Expenses, and Changes in Net Position.
The Electric Utility h as become a Participating Transmission Owner with the California Independent System Operator (CAISO) and has turned over the operational control of its transmission entitlements including the Southern Transmission System, Mead-Phoenix and Mead-Adelanto Transmission Projects. In return, users of California’s high voltage transmission grid are charged for, and the Electric Utility r eceives reimbursement for, transmission revenue requirements, including the costs associated with these three transmission projects.
Hoover Uprating Project
The Electric Utility’s initial entitlement in the Hoover project through SCPPA terminated on September 30, 2017. On August 23, 2016, the City C ouncil approved a 50-year Electric Service Contract (ESC) and an Amended and Restated Implementation Agreement (IA) with the Western Area Power Administration (Western), Bureau of Reclamation for 30 MW o f hydroelectric power. The contract with Western is effective as of October 1, 2017. The ESC extended the Electric Utility’s 30 MW entitlement in the Hoover project through 2067. The IA is a supplemental agreement to the ESC that establishes administrative, budgetary and project oversight by creating project committees and process for decision making plant operations.
Nuclear Insurance
The Price-Anderson Act (the Act) requires that all utilities with nuclear generating facilities purchase the maximum private primary n uclear liability insurance available ($450 million) and participate in the industry’s secondary financial protection plan. The secondary f inancial protection program is the industry’s retrospective assessment plan that uses deferred premium charges from every l icensed reactor owner if claims and/or costs resulting from a nuclear incident at any licensed reactor in the United States were to exceed the primary nuclear insurance at that plant’s site. Effective June 10, 2021, the Act limits liability from third-party claims to approximately $13.7 billion per incident.
Under the industry wide retrospective assessment program provided for under the Act, assessments are limited to $137.6 million per reactor for each nuclear incident occurring at any n uclear reactor in the United States, with payments under the program limited to $20.5 million per reactor, per year, per event to be indexed for inflation every f ive years. Based on the Electric Utility’s interest in Palo Verde, the Electric Utility would be responsible for a maximum assessment of $1.3 million, limited to payments of $0.2 million per incident, per year. If the public liability limit above is insufficient, federal regulations may impose further revenue-raising measures to pay c laims, including a possible additional assessment on all licensed reactor operators.
Renewable Portfolio Standards (RPS)
On April 12, 2011, the California Renewable Energy Resources Act (SBX1-2) was signed into law by t he Governor, which officially c reated the first set of tiered RPS targets of 20% by 2013, 25% by 2016 and 33% by 2020. SBX1-2 specified that publicly owned utilities must meet these defined targets via interim Compliance Period (CP) targets to achieve the end goal of 33% RPS by December 31, 2020 as follows: CP1 - an average of 20 percent of retail sales during the three year period from 2011-2013; CP2 – no less than 25 percent of retail sales by December 31, 2016; and CP3 – no less than 33 percent of retail sales by D ecember 31, 2020. The Riverside Public Utilities Board and City Council approved the RPS Enforcement Program required by S BX1-2 on November 18, 2011 and December 13, 2011, respectively, and further approved the Electric Utility’s RPS Procurement Plan (a.k.a. Procurement Policy) implementing the new RPS mandates on May 3 , 2013 and May 1 4, 2013, respectively. The Electric Utility m et the procurement requirements of SBX1-2 for CP1 (2011-2013) CP2 (2014-2016), and CP3 (2017-2020). The additional future mandates are expected to be met with resource procurement actions as outlined in the Electric Utility’s RPS Procurement Plan. For calendar year 2021, renewable resources provided 43 percent of retail sales requirements.
On October 7, 2015, the Governor signed into law Senate Bill 350 (SB 350) increasing the RPS mandate from 33 percent by 2 020 to 50 percent by December 31, 2030. In addition, SB 350 required that an updated RPS Procurement Policy be approved and adopted before January 1, 2019 and be incorporated into the Electric Utility’s Integrated Resource Plan. An updated 2018 Renewable Energy P rocurement Policy w as adopted by t he Board and City C ouncil on September 10, 2018 and October 9, 2018, respectively. The Electric Utility e xpects to be able to substantially m eet the increased RPS mandates imposed by S B 350 with the actions described in the updated procurement policy and the portfolio of renewable resources outlined below. 64 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
On September 10, 2018, the 100 Percent Clean Energy Act of 2018 (Senate Bill 100) was signed into law by the California Governor. This bill further increases the RPS goals of SBX1-2 and SB 350 while maintaining the 33 percent RPS target by D ecember 31, 2020, but modifying the RPS percentages to be 44 percent by December 31, 2024, 52 percent by December 31, 2027, 60 percent by December 31, 2030, with an end goal of 100 percent of total retail sales of electricity in California generated from eligible renewable energy resources and zero-carbon resources by December 31, 2045. It is expected that the California Energy Commission will have further guidance and enforcement procedures for publicly o wned utilities to meet these increased mandates. The Electric Utility will continue to monitor the outcome and impacts of any upcoming workshops and regulations in meeting the new requirements.
In an effort to increase the share of renewables in the Electric Utility’s power portfolio, the Electric Utility entered into power purchase agreements (PPA) and power sales agreements (PSA) with various entities described below in general on a “take-and-pay” basis. The contracts in the following tables were executed as part of compliance with RPS mandates.
Long-term renewable PPAs and PSAs in operation:
Supplier Type
Maximum
Contract1 Contract
Expiration
Estimated
Annual
Cost for
2022
Wintec Wind 1.3 MW 02/19/2024 $ 150
WKN Wagner Wind 6.0 MW 12/22/2032 1,344
Terraform Power - AP North Lake Photovoltaic 20.0 MW 08/11/2040 4,905 Onward Energy - Columbia II Photovoltaic 11.1 MW 12/22/2034 2,314 GlidePath Power Solutions - GPS Cabazon Wind LLC Wind 39.0 MW 01/01/2025 4,299 Capital Dynamics - Kingbird Solar B, LLC Photovoltaic 14.0 MW 12/31/2036 2,867 AES - Summer Solar Photovoltaic 10.0 MW 12/31/2041 1,748 AES - Antelope Big Sky Ranch Photovoltaic 10.0 MW 12/31/2041 1,748 AES - Antelope DSR 1 Solar Photovoltaic 25.0 MW 12/19/2036 3,826 Captial Dynamics - Tequesquite Landfill Solar Photovoltaic 7.3 MW 12/31/2040 1,423 American Renewable Power - Loyalton Biomass 0.8 MW 04/19/2023 615 Roseburg Forest Products Biomass 0.5 MW 02/16/2026 179
CalEnergy - Salton Sea Portfolio Geothermal 86.0 MW 12/31/2039 55,622 Atlantica - Coso Geothermal Geothermal 10.0 MW 12/31/2042 6,050 Total 241.0 MW $ 87,090
1 All contracts are contingent on energy delivered from specific related generating facilities. The Electric Utility has no commitment to pay any amounts except for energy delivered on a monthly basis from these facilities except for any economic curtailments directed by the Electric Utility.
Long-term renewable PPAs with expected delivery:
Supplier Type
Maximum
Contract1 Expected
Delivery
Energy
Delivery
No Later
Than
Contract
Term
In Years
Atlantica - Coso Geothermal Geothermal 20.0 MW 01/01/2027 01/01/2027 15 Total 20.0 MW
1 All contracts are contingent on energy delivered from specific related generating facilities. The Electric Utility has no commitment to pay any amounts except for energy delivered on a monthly basis from these facilities except for any economic curtailments directed by the Electric Utility.
Cap-and-Trade Program
Assembly B ill (AB) 32, enacted in 2006, mandated that the California Air Resources Board (CARB) develop regulations for the reduction of greenhouse gas (GHG) emissions to the 1990 levels by t he year 2020. Subsequently, Senate Bill (SB 32), enacted in 2016, extended the requirements of AB 32 and codified that it was the State’s goal to reduce GHG emissions to 40% below 1990 levels by the year 2020. AB 398 was then enacted in 2017 clarifying that it was the State legislature’s intent to continue the Cap-and-Trade Program and regulations until 2030. In January 2 013, emission compliance obligations developed by CARB began under the Cap-and-Trade Program (Program). This Program requires electric utilities to have GHG allowances on an annual basis to offset GHG emissions associated with generating electricity. To ease the transition and mitigate the rate impacts to retail customers, CARB will allocate certain amounts of GHG allowances at no cost to electrical distribution utilities.
The Electric Utility’s free allocation of GHG allowances is expected to be sufficient to meet the Electric Utility’s direct GHG compliance obligations.
At times, the Electric Utility m ay h ave allocated allowances in excess of its compliance obligations that can be sold into the CARB quarterly a uctions. In fiscal year ended June 30, 2022, the Electric Utility r eceived $14,960 i n proceeds related to the sale of the GHG allowances which are included on the Statements of Revenues, Expenses, and Changes in Net Position as other operating revenue. The Electric Utility h as established a restricted Regulatory Requirement reserve to comply w ith regulatory r estrictions and governing requirements related to the use of the GHG proceeds. The available funds are to be utilized for qualifying projects, consistent with the goals of AB 32 to benefit the retail ratepayers. The balance in the Regulatory Requirement reserve was $16,366 as of June 30, 2022.
The Electric Utility also purchases GHG allowances which can be used in future periods for GHG compliance regulations. The balance of purchased GHG 65 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
allowances was $485 as of June 30, 2022 and is recorded as inventory in the Statement of Net Position.
Low Carbon Fuel Standard Program
Assembly B ill (AB) 32, enacted in 2006, mandated that the California Air Resources Board (CARB) develop regulations for the reduction of greenhouse gas (GHG) emissions to the 1990 levels by t he year 2020. Subsequently, Senate Bill (SB 32), enacted in 2016, extended the requirements of AB 32 and codified that it was the State’s goal to reduce GHG emissions to 40% below 1990 levels by the year 2020. Similar to the Cap-and-Trade Program, the Low Carbon Fuel Standard (LCFS) Program is a key c omponent of the market mechanisms authorized by t hese bills to achieve the State’s GHG emissions reduction goals. The LCFS regulation was initially approved by CARB in 2009.
The program then underwent some litigation in the State of California and the regulation was re-adopted in 2015 with modifications and went into effect in 2016. LCFS seeks to reduce the carbon intensity ( CI) of fuels used for transportation by establishing an annual CI target. Fuels that have a CI greater than the target have a compliance obligation and are required to turn in LCFS credits; fuels with a CI lower than the target may generate credits.
Electricity i s considered a fuel subject to the program when it is used as a transportation fuel in electric vehicles. However, because the CI of electricity is substantially lower than the annual CI targets under the program, electricity is a fuel that generates LCFS credits and participation in the Program is voluntary.
The City o pted into the LCFS program in March 2018 and began generating LCFS credits for the first quarter of 2018. These credits are associated with two sources – unmetered electricity u sed to charge residents’ electric vehicles at their homes (residential base credits) and from electric forklifts charging at private businesses (forklift credits). CARB calculates the credits that the Electric Utility receives, and the Electric Utility submits reports quarterly to receive the credits.
The LCFS regulation was amended in 2018 and required that electric utilities that have opted into the LCFS Program participate in and manage a statewide point-of-sale rebate program for new electric vehicles. This program is called the California Clean Fuel Reward Program (CFR) and the City j oined the program in May 2 020. To fund the program, electric utilities are required to contribute proceeds received from the sales of residential base credits beginning with the credits the Electric Utility r eceived in Q4 2019 (generated from electricity used for transportation in Q2 2019). Residential base credits the Electric Utility r eceived prior to that time are not subject to the contribution requirements. Additionally, a “start-up” contribution from proceeds is required to be submitted by January 31, 2021. After the initial deposit of funds in November 2020, deposits to the CFR program are required by March 31 annually.
In fiscal year ended June 30, 2022, the Electric Utility’s proceeds from the sale of LCFS credits were $1,047. These proceeds are included on the Statements of Revenues, Expenses and Changes in Net Position as other operating revenue. The Electric Utility h as established a restricted Regulatory Requirement reserve to comply w ith regulatory r estrictions and governing requirements related to the use of the LCFS proceeds. The available funds are to be utilized for qualifying programs that support the Electric Utility's customers who are existing and future electric vehicle owners. Total expenses for qualifying programs as of June 30, 2022 w as $210. The balance in the Regulatory Requirement reserve as of June 30, 2022 was $3,233.
15. Other Post-Employment Benefits (OPEB)
Plan description - The City’s defined benefit OPEB plan, Retiree Health Plan, provides continuation of medical (including prescription drugs) and dental coverage benefits to retirees and surviving spouses in the form of an implied rate subsidy. The Retiree Health Benefits plan is a single employer defined benefit OPEB plan administered by t he City. No assets are accumulated in a trust that meets the criteria in paragraph 4 of GASB Statement No. 75.
Benefits provided - Eligibility f or continuation of coverage requires retirement from the City and CalPERS with at least 5 years of City service. The retiree is responsible for 100% of the premium cost for coverage, which is based on the blended experience of both the active and retired employees. The City is not required by law or contractual agreement to provide funding other than the pay- as-you-go amount necessary to provide current benefit to eligible retirees and beneficiaries. Retiree and spousal coverage terminate when the retirees become covered under another employer health plan, or when the retiree reaches Medicare eligibility a go, which is currently a ge 65. However, retiree benefit continues to the surviving spouse if the retiree elects the CalPERS survivor annuity.
66 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Employees covered by b enefit terms – At June 30, 2021, the following employees were covered by the benefit terms:
Inactive plan members or beneficiaries currently receiving benefits 206 Inactive plan members entitled to but not yet receiving benefits - Active plan members 2,014
Total 2,220
Significant Actuarial Assumptions Used in Calculating the Total OPEB Liability The total OPEB liability w as determined by a n actuarial valuation using the following actuarial assumptions:
Valuation Date: June 30, 2021
Measurement Date: June 30, 2021
Funding Policy: Pay-as-you-go for implicit rate subsidy Discount Rate: 2.16% per annum. This discount rate is the maximum of the range of 3-20 year municipal bond rate indices: S&P Municipal Bond 20 Year High Grade Rate Index, Bond Buyer 20-Bond GO Index, and Fidelity GO AA 20 Year Bond Index Inflation Rate: 2.5% per annum
Salary Inflation: 2.75% per annum
Salary Increases: The benefits are not payroll related but the City’s cost for each individual’s projected City contribution is allocated over their lifetime as a level-percentage of pay.
Mortality: Based on the CalPERS 2017 Experience Study
Sensitivity analysis of total OPEB liability for healthcare cost trend rates.
The following presents the total net OPEB liability, calculating using the healthcare cost trend rate of 4.0%, as well as what the total OPEB liability would be if it were calculated using a healthcare cost trend rate that is 1-percentage- point lower (3.0%) or 1-percentage-point higher (5.0%) than the current rate:
Current Healthcare
1% Decrease Cost Trend Rate 1% Increase
3% 4% 5%
Total OPEB liability $ 42,917 $ 48,770 $ 55,716
Sensitivity analysis of total OPEB liability for discount rates The following presents the total OPEB liability, calculating using the discount rate of 2.16%, as well as what the total OPEB liability w ould be if it were calculated using a discount rate that is 1-percentage-point lower (1.16%) or 1- percentage-point higher (3.16%) than the current rate:
1% Decrease
(1.16%)
Current
Discount Rate
(2.16%)
1% Increase
(3.16%)
Total OPEB liability $ 52,938 $ 48,770 $ 44,908
Change in total OPEB liability
For fiscal year 2022, the City recognized total OPEB expense of $2,790. The following table shows the change in the total OPEB liability for the year ended June 30, 2022:
2022
Beginning total OPEB liability $ 52,276
Service cost 2,646
Interest 1,394
Differences between expected and actual experience (2,267) Changes of assumptions (3,086)
Benefit of implied subsidy payments (2,193)
Net changes (3,506)
Ending total OPEB liability $ 48,770
67 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Deferred outflows/inflows of resources
At June 30, 2022, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:
Deferred Outflows
of Resources
Deferred Inflows of
Resources
Contributions subsequent to the
measurement date $ 1,628 $ -
Differences between expected
and actual experience 195 3,860
Changes of assumptions 8,097 3,599
Total $ 9,920 $ 7,459
Amounts reported as deferred outflows/(inflows) of resources related to OPEB will be recognized in OPEB expense as follows:
Year Ending June 30,
Deferred
Outflows/(Inflows)
of Resources
2023 $ 377
2024 377
2025 377
2026 585
2027 624
Thereafter (1,507)
Total $ 833
16. City Employees Retirement Plan
(A) Plan Description - The City of Riverside contributes to the California Public Employees Retirement System (CalPERS), an agent multiple employer public employee defined benefit pension plan. CalPERS provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. CalPERS acts as a common investment and administrative agent for participating public entities within the State of California.
Benefit provisions and all other requirements are established by s tate statute and City ordinance. A copy of CalPERS’ annual financial report may be obtained online at www.calpersca.gov.
(B) Funding Policy - The City has contributed at the actuarially determined rate provided by CalPERS’ actuaries. Participants are required to contribute 8% for miscellaneous employees and 9% for safety employees of their annual covered salary. The City has a multiple tier retirement plan with benefits varying by plan.
The City pays the employees’ contributions to CalPERS for both miscellaneous and safety employees hired on or before specific dates as follows:
Safety (Police):
1st T ier (RPOA, RPOA Supervisory & R PAA Management) - The retirement formula is 3% at age 50 for employees hired on or before February 1 6, 2012 (RPOA, RPAA Management) or June 8, 2012 (RPOA Supervisory). E ffective January 1 , 2018, employees were required to pay 1 .5% of their pensionable income, with the City contributing the other 7.5%. Only i n the event that annual wages increase in excess of 2%, will the following apply: Effective January 1, 2019, employees were required to pay a n additional portion of their pensionable income. This portion is a three-year increase of 1.5% (2019), 1.5% (2020) and 1.5% (2021). However, the 2021 increase did not take affect; therefore in 2022, employees are contributing 4.5% pensionable income.
2nd T ier (RPOA, RPOA Supervisory & R PAA Management) - The retirement formula is 3% at age 50 for RPOA and RPAA Management employees hired on or after February 17, 2012 and RPOA Supervisory employees hired on or after June 8, 2012 pay t heir share (9%) of contributions.
3rd Tier (RPOA, RPOA Supervisory & RPAA) – The retirement formula is 2.7% at age 57 for new members hired on or after January 1, 2013 and the employee must pay t he normal cost to CalPERS which is currently a t 12.75%. Classic members (CalPERS members prior to 12/31/12) hired on or after January 1 , 2013 may be placed in a different tier.
Safety (Fire):
1st Tier - The retirement formula is 3% at age 50 for employees hired before June 11, 2011. E ffective January 1 , 2019, employees were required to pay a portion of their pensionable income. This portion is a 68 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
three-year increase of 2.5% (2019), 2.5% (2020) and 3% (2021).
However, the 2021 increase was only 2 % with the remaining 1% increase in 2022; therefore, in 2022, employees are contributing 8% of their pensionable income.
2nd Tier - The retirement formula is 3% at age 55 and new employees hired on or after June 11, 2011 pay their share (9%) of contributions. 3rd Tier – The retirement formula is 2.7% at age 57 for new members hired on or after January 1, 2013. A new member, as defined by the Public Employees’ Pension Reform Act (PEPRA), hired on or after January 1 , 2013 pay 5 0% of the normal cost to CalPERS which is currently 12.75% of compensation.
Miscellaneous:
1st Tier –
The retirement formula is 2.7% at age 55 for employ ees hired on or before October 18, 2011. E ffective January 1 , 2018 for unrepresented employees (Sr. Management, Management,
Professional, Para-professional, Supervisory, Confidential, and Executive units, excluding the Chief of Police and the Fire Chief), the employees were required to pay 2 % of their pensionable income, with the City contributing the other 6%. Effective January 1, 2019, employees were required to pay an additional portion of their pensionable income. This portion is a three-year increase of 2% (2019), 2% (2020) and 2% (2021). As of 2021, employees were contributing the entire 8% of their pensionable income. The retirement formula is 2.7% at age 55 for SEIU and SEIU Refuse employees hired before June 7, 2011. Currently, employees are required to pay 7 % of their pensionable income with the City contributing the other 1%. Effective January 1 , 2019, employees were required to pay a n additional portion of their pensionable income. This portion is a two-year increase of 1% (2019) and 1% (2020). A s of 2020, employees are contributing the entire 8% of their pensionable income.
The retirement formula is 2.7% at age 55 for IBEW a nd IBEW Supervisory e mployees hired on or before October 18, 2011.
Effective November 1, 2017 employees were required to pay 2% of their total pensionable income with the City p aying the remaining 6%. Effective each November 1 st, employees will be required to pay an additional portion of their pensionable income. This portion is a three-year increase of 2% (2018), 2% (2019) and 2% (2020). As of November 2020, employees are contributing the entire 8% of their pensionable income.
2nd Tier - The retirement formula is 2.7% at age 55, and:
Miscellaneous employees, IBEW, and IBEW Supervisory h ired on or after October 19, 2011 pay their share (8%) of contributions. SEIU and SEIU Refuse employees hired on or after June 7, 2011 pay their share (8%) of contributions.
3rd T ier – The retirement formula is 2% at age 62 for new members hired on or after January 1 , 2013 and the employee must pay t he normal cost to CalPERS which is currently at 7.75%. Classic members (CalPERS members prior to 12/31/12) hired on or after January 1 , 2013 may be placed in a different tier.
The contribution requirements of plan members and the City a re established and may be amended by CalPERS.
(C) 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 five years of service. The death benefit is one of the following: the Basic Death Benefit, the 1959 Survivor Benefit Level III, or the Optional Settlement 2W Death Benefit.
The cost of living adjustments for each plan are applied as specified by t he Public Employees’ Retirement Law.
(D) Employees Covered - At June 30, 2021, the following employees were covered by the benefit terms of each Plan: Inactive employees or beneficiaries currently receiving benefits are 2,373 and 832 for the Miscellaneous and Safety Plans, respectively. Inactive employees entitled to but not yet receiving benefits 69 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
are 1,422 a nd 186 f or Miscellaneous and Safety P lans, respectively. Active employees were 1,508 a nd 579 f or Miscellaneous and Safety P lans, respectively.
(E) Contributions – Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by t he actuary a nd shall be effective on the July 1 f ollowing 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 d etermined rate and the contribution rate of employees.
(F) Net Pension Liability - The City’s net pension liability f or each Plan is measured as the total pension liability, less the pension plan’s fiduciary n et position. The net pension liability of each of the Plans is measured as of June 30, 2021, using an annual actuarial valuation as of June 30, 2020 rolled forward to June 30, 2021 u sing standard update procedures. The liability f or the governmental activities is primarily liquidated from the General Fund.
A summary o f principal assumptions and methods used to determine the net pension liability i s shown below. Actuarial Assumptions – The total pension liabilities in the June 30, 2021 actuarial valuations were determined using the following actuarial assumptions:
Miscellaneous Safety
Valuation Date June 30, 2020 June 30, 2020
Measurement Date June 30, 2021 June 30, 2021
Actuarial Cost Method Entry-Age Normal Cost Method
Actuarial Assumptions
Discount Rate 7.15% 7.15%
Inflation 2.50% 2.50%
Salary Increase Varies by Entry Age and Service
Mortality Rate Table1 Derived using CALPERS' membership data for all funds Post Retirement Benefit
Increase
The lesser of contract COLA or 2.50% until Purchasing Power Protection Allowance floor on purchasing power applies, 2.50% thereafter
1 T he mortality t able used was developed based on CalPERS-specific data.
The probabilities of mortality a re based on the 2017 CalPERS Experience Study f or the period from 1997 to 2015. Pre-retirement and Post-retirement mortality rates include 15 years of projected mortality improvement using 90% of Scale MP-2016 published by the Society of Actuaries. For more details on this table, please refer to the CalPERS Experience Study a nd Review of Actuarial Assumptions report from December 2017 that can be found on the CalPERS website.
Long-term Expected Rate of Return - The long-term expected rate of return on pension plan investments was determined using a building-block method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.
In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectations as well as the expected pension fund cash flows. Using historical returns of all of the funds’ asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11+ years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by c alculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equal to the single equivalent rate calculated above and adjusted to account for assumed administrative expenses. The expected real rates of return by asset class are as followed:
Asset Class1
Current Target
Allocation
Real Return
Years 1 - 102
Real Return
Years 11+3
Public Equity 50.00% 4.80% 5.98%
Fixed income 28.00% 1.00% 2.62%
Inflation Assets 0.00% 0.77% 1.81%
Private Equity 8.00% 6.30% 7.23%
Real Assets 13.00% 3.75% 4.93%
Liquidity 1.00% 0.00% (0.92)%
1 In the System’s CAFR, Fixed Income is included in Global Debt Securities; Liquidity is included in Short-term Investments; Inflation Assets are included in both Global Equity Securities and Global Debt Securities. 2 An expected inflation of 2.00% used for this period
70 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
3 An expected inflation of 2.92% used for this period
Discount Rate - The discount rate used to measure the total pension liability was 7.15%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily r equired rates, actuarially d etermined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Changes in Assumptions – In 2021, there was no changes in assumptions. (G) Changes in the Net Pension Liability
The changes in the Net Pension Liability for each Plan follows:
Miscellaneous Increase (Decrease)
Total
Pension
Liability
Plan
Fiduciary
Net Position
Net Pension
Liability/(Asset)
Balance at June 30, 2020 $ 1,492,113 $ 1,372,046 $ 120,067 Changes recognized for the measurement
period:
Service cost 26,168 - 26,168
Interest on total pension liability 105,017 - 105,017
Differences between expected and actual
experience 873 - 873
Net Plan to Plan Resource Movement - (1) 1
Contributions - employer - 26,274 (26,274)
Contributions - employees - 10,358 (10,358)
Net investment income - 305,548 (305,548)
Benefit payments, including
refunds of employee
contributions (74,608) (74,608) -
Administrative expenses - (1,371) 1,371
Net changes 57,450 266,200 (208,750)
Balance at June 30,2021 $ 1,549,563 $ 1,638,246 $ (88,683) Safety Increase (Decrease)
Total
Pension
Liability
Plan
Fiduciary
Net Position
Net Pension
Liability/(Asset)
Balance at June 30, 2020 $ 1,195,893 $ 1,086,394 $ 109,499 Changes recognized for the measurement
period:
Service cost 23,160 - 23,160
Interest on total pension liability 84,654 - 84,654
Differences between expected and actual
experience 6,361 - 6,361
Net Plan to Plan Resource Movement - 1 (1)
Contributions - employer - 22,931 (22,931)
Contributions - employees - 10,492 (10,492)
Net investment income - 242,945 (242,945)
Benefit payments, including
refunds of employee
contributions (59,739) (59,739) -
Administrative expenses - (1,085) 1,085
Net changes 54,436 215,545 (161,109)
Balance at June 30,2021 $ 1,250,329 $ 1,301,939 $ (51,610) Sensitivity of the Net Pension Liability to Changes in the Discount Rate - The following presents the net pension liability of the City for each Plan, calculated using the discount rate for each Plan, as well as what the City’s net pension liability w ould be if it were calculated using a discount rate that is one percentage point lower or one percentage point higher than the current rate:
Miscellaneous
Discount Rate
-1% (6.15%)
Current
Discount Rate
(7.15%)
Discount Rate
+1% (8.15%)
Plan's net pension liability/(asset) $ 118,863 $ (88,683) $ (259,597) Safety
Discount Rate
-1% (6.15%)
Current
Discount Rate
(7.15%)
Discount Rate
+1% (8.15%)
Plan's net pension liability/(asset) $ 116,434 $ (51,610) $ (189,837) Pension Plan Fiduciary Net Position – Detailed information about each pension plan’s fiduciary n et position is available in the separately i ssued CalPERS 71 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
financial reports.
(H) Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions.
For the year ended June 30, 2022, the City r ecognized pension expense of $(47,456) to Miscellaneous and $(26,481) to Safety for a total of $(73,937). At June 30, 2022, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
Miscellaneous
Deferred
Outflows
of Resources
Deferred
Inflows
of Resources
Pension contributions subsequent to measurement
date, net $ 27,330 $ -
Differences between expected and actual
experience 3,680 -
Net differences between projected and actual
earnings on plan investments - (149,129)
Total $ 31,010 $ (149,129)
Safety
Deferred
Outflows
of Resources
Deferred
Inflows
of Resources
Pension contributions subsequent to measurement
date, net $ 24,773 $ -
Changes of assumptions - (221)
Differences between expected and actual
experience 14,268 -
Net differences between projected and actual
earnings on plan investments - (118,092)
Total $ 39,041 $ (118,313)
$52,103 r eported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability i n the subsequent fiscal period rather than in the current fiscal period.
Amortization of Deferred Outflows and Deferred Inflows of Resources - Under GASB 68, gains and losses related to changes in total pension liability a nd fiduciary n et position are recognized in pension expense systematically o ver time.
The first amortized amounts are recognized in pension expense for the y ear the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to pensions and are to be recognized in future pension expense.
The amortization period differs depending on the source of the gain or loss:
Net difference between
projected and actual earnings 5 year straight-line amortization All other amounts Straight-line amortization over the expected average remaining service lifetime (EARSL) of all members that are provided with benefits (active, inactive, and retired) as of the beginning of the measurement period
The remaining amounts reported as deferred outflows of resources and deferred (inflows) of resources related to pensions will be recognized as pension expense as follows:
Fiscal Year Miscellaneous Safety
2023 $ (34,425) $ (22,577)
2024 (33,631) (22,494)
2025 (35,597) (26,164)
2026 (41,796) (32,810)
Total (145,449) (104,045)
Subsequent Events - There were no subsequent events that would materially affect the results presented in this disclosure.
72 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
17. Other Long-Term Obligations
Changes in Long-Term Obligations
Below is a summary of changes in long-term obligations during the fiscal year for the former Redevelopment Agency, which is accounted for in the Successor Agency Trust Fund (a fiduciary fund):
Beginning
Balance Additions Reductions
Ending
Balance
Due Within
One Year
Lease revenue bonds $ 11,641 $ - $ (2,291) $ 9,350 $ 2,399 Tax allocation bonds 171,416 - (6,074) 165,342 4,710
Direct borrowings:
Notes payable 3,918 - - 3,918 34
$ 186,975 $ - $ (8,365) $ 178,610 $ 7,143
Lease Revenue Bonds - Successor Agency:
Principal
Outstanding
$26,255 State of California Department of General Services Project, 2003 Lease Revenue Refunding Bonds, Series A are secured by l ease payments made by t he State of Califronia Department of General Services for the California Tower office building; 2% to 5% due in annual installments from $545 to $2,230 through October 1, 2024. The bonds are subject to acceleration under the Trust Agreement upon the occurrence of an event of default and with the consent of the Insurer. There is no remedy of acceleration of the total Base Rental over the term of the Lease. $ 6,265
$4,810 State of California Department of General Services Project, 2003 Lease Revenue Refunding Bonds, Series B are secured by l ease payments made by t he State of California Department of General Services for the California Tower office building; $310 serial bonds 1.20% to 1.42% through October 1, 2004; $620 term bonds at 3.090% due October 1, 2008; $1,110 term bonds at 4.340% due October 1, 2014 and $2,770 term bonds at 5.480% due October 1, 2024. The bonds are subject to acceleration under the Trust Agreement upon the occurrence of an event of default and with the consent of the Insurer. There is no remedy of acceleration of the total Base Rental over the term of the Lease. 995
In 2019, the 2012A Lease Revenue Refunding bonds were
distributed between Governmental Activities, Business-Type Activities, and the Successor Agency t o properly r eflect their proportional share.
$41,240 Lease Revenue Refunding Bonds, Series 2012A. The bonds are secured by lease payments on a portion of the City Hall Complex and the Lincoln Police Patrol Center. The bonds were issued to refinance the 2003 Certificates of Participation.
Interest on the bonds is payable semi-annually o n May 1 a nd November 1 of each year, commencing May 1, 2013. The rate of interest varies from 2% to 5% per annum d epending on maturity date. Principal is payable in annual installments ranging from $1,295 to $2,840 commencing November 1, 2013 and
ending November 1, 2033. In the event of default, the Trustee may retain the Lease Agreement and hold the City liable for all Base Rental Payments on an annual basis. The rental payments may not be accelerated. $2,415 relates to the Successor Agency. 1,941
Subtotal 9,201
Add: Unamortized bond premium 149
Total lease revenue bonds $ 9,350
Remaining debt service will be paid by the Successor Agency Trust from future property t ax revenues. Annual debt service requirements to maturity a re as follows:
Fiscal Year Principal Interest Total
2023 $ 2,399 $ 392 $ 2,791
2024 2,556 267 2,823
2025 2,716 135 2,851
2026 141 64 205
2027 147 58 205
2028-2032 850 174 1,024
2033-2037 392 16 408
Premium 149 - 149
Total $ 9,350 $ 1,106 $ 10,456
73 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Tax Allocation Bonds - Successor Agency:
Principal
Outstanding
On October 16, 2014, the Successor Agency t o the
Redevelopment Agency o f the City o f Riverside issued 2014 Subordinate Tax Allocation Refunding Bonds (Series A and B) in the amount of $62,980. The bonds were issued to refund certain obligations of the former Redevelopment Agency of the City of Riverside. Interest is due semi-annually on March 1 and September 1, commencing March 1, 2015. Principal is due in annual installments from $160 to $4,745 through September 1, 2034. The rate of interest varies from 0.6% to 5% per annum. $ 32,980 $114,815 2018 Tax Allocation Refunding Bonds (Series A and B). The bonds were issued to refund the 2007 Riverside Public Financing Authority R edevelopment Agency T ax Allocation Bonds (Series A, B, C and D). Principal is payable in annual installments from $140 to $9,180 through September 1, 2037.
The rate of interest varies from 3.125% to 5% per annum. The refunding transaction resulted in a total net present value savings of $20,000. 114,815
Subtotal 147,795
Add: Unamortized bond premium 17,547
Total tax allocation bonds $ 165,342
The Successor Agency T ax Allocation Bonds are secured by t ax revenues deposited in the Redevelopment Property T ax Trust Fund for the Agency established and held by the County of Riverside Auditor-Controller pursuant to Section 34813(a)(2) of the Dissolution Act. Upon event of default, the principal due on the Bonds is subject to acceleration.
Remaining debt service will be paid by the Successor Agency Trust Fund from future property tax revenues. Annual debt service requirements to maturity are as follows:
Fiscal Year Principal Interest Total
2023 $ 4,710 $ 6,823 $ 11,533
2024 10,280 6,450 16,730
2025 10,690 5,928 16,618
2026 10,795 5,392 16,187
2027 11,135 4,844 15,979
2028-2032 48,915 16,512 65,427
2033-2037 44,435 5,835 50,270
2038-2042 6,835 137 6,972
Premium 17,547 - 17,547
Total $ 165,342 $ 51,921 $ 217,263
Notes Payable – Successor Agency:
Principal
Outstanding
These notes payable have been issued to promote development and expansion within the City’s redevelopment areas.
Pepsi Cola Bottling Company of Los Angeles, 10.5%, payable in net annual installments of $341, subject to recording of completion. Interest accrues on the outstanding note balance upon issuance of the Certificate of Completion. Principal and interest on the note are payable solely from Project Property Tax Increment. Payments start upon the time sufficient increment is generated in one year to pay the annual principal and interest on the note. Upon 25 years from the first anniversary d ate of the certificate of completion, all unpaid principal together with any accrued interest will be forgiven. $ 2,987
Smith’s Food & Drug Centers Inc., 6% payable in variable installments, subject to payment of annual Community Facilities District assessment. The note is secured under a developer agreement. 931
Total notes payable $ 3,918
74 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Remaining debt service will be paid by the Successor Agency Trust Fund from future property tax revenues. Annual debt service requirements to maturity are as follows:
Fiscal Year Principal Interest Total
2023 $ 34 $ 307 $ 341
2024 38 303 341
2025 42 300 342
2026 47 295 342
2027 51 291 342
2028-2032 349 1,360 1,709
2033-2037 576 1,134 1,710
2038-2042 948 761 1,709
2043-2047 1,833 807 2,640
Total $ 3,918 $ 5,558 $ 9,476
Assessment Districts and Community Facilities Districts Bonds (Not obligations of the City):
As of June 30, 2022, the City h as several series of Assessment District and Community Facility District Bonds outstanding in the amount of $41,595. Bonds were issued for improvements in certain districts and are long-term obligations of the property o wners. The City T reasurer acts as an agent for the property owners in collecting the assessments, forwarding the collections to bondholders and initiating foreclosure proceedings, if applicable. Since the debt does not constitute an obligation of the City, it is not reflected as a long-term obligation of the City and is not reflected in the government-wide financial statements.
18. Interfund Assets, Liabilities and Transfers
Due From/To Other Funds: These balances resulted from expenditures being incurred prior to receipt of the related revenue source.
The following table shows amounts receivable/payable between funds within the City at June 30, 2022:
Receivable Funds Payable Funds Amount
General Fund Non-Major Governmental Funds $ 831
Internal Service Funds 39
Total $ 870
Advances To/From Other Funds: These balances consist of advances used to fund capital projects in advance of related financing/assessments and for other long-term borrowing purposes.
The following table shows amounts advanced from funds within the City to other funds within the City at June 30, 2022:
Receivable Funds Payable Funds Amount
Sewer General Debt Service Fund $ 1,442
In addition, the following advances to the former Redevelopment Agency a re accounted for in the Private-Purpose Trust Fund of the Successor Agency:
Receivable Funds Amount
Electric $ 2,454
Transfers In/Out: T ransfers are primarily u sed to (1) move revenues to the fund that statute or budget requires to expend them, and (2) move receipts restricted to debt service from the funds collecting the receipts to the debt service fund as debt service payments become due.
75 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
The following table shows amounts transferred to/from funds within the City for the year ended June 30, 2022:
Transfers in Funds Transfers Out Funds Amount
General Fund Capital Outlay Fund $ 48
General Debt Service Fund 11,292
Non-Major Governmental Funds 102
Electric Fund 39,436
Water Fund 7,708
58,586
Capital Outlay Fund General Fund 11,325
Non-Major Enterprise Funds 326
11,651
General Debt Service
Fund General Fund 39,681
Capital Outlay Fund 2,997
Non-Major Governmental Funds 1,958
44,636
Non-Major Governmental
Funds General Fund 2,018
Non-Major Enterprise
Funds General Fund 11,973
Non-Major Governmental Funds 1,300
13,273
Internal Service Fund General Fund 2,685
Non-Major Governmental Funds 1
Sewer 14
Non-Major Enterprise Funds 10
Internal Service Funds 4
2,714
Total $ 132,878
19. Deficit Net Position
Deficit net position exists in the non-major governmental fund, Housing & Community D evelopment ($1,215). The deficit is primarily d ue to grant expenditures recognized in the current fiscal year while revenue cannot be recognized until completion of certain grant projects, which will occur beyond the revenue recognition period. Revenue will be recognized in subsequent fiscal year and the fund should no longer be in a deficit.
Deficit net position exists in the non-major enterprise fund, Transportation $(1,146). The deficit is primarily due to the net pension and OPEB liabilities.
Deficit net position exists in the Self-Insurance Internal Service Fund $(34,578).
This City adopted a Self-Insurance Reserve Policy that addresses the on-going deficit in fund balance. In the past, the City began funding a portion of the deficit in the internal service fund via self-insurance rate increases phased in over several years. However, the increases continue to be offset by unusually large losses incurred during the year combined with an adjustment for the increase in the amount estimated for claims and judgments. Management believes that there are sufficient funds on hand to cover current payment obligations and plans to continue to control costs and increase rates, as needed.
Deficit net position exists in the Successor Agency Private-Purpose Trust Fund $(134,245). The deficit in the Successor Agency T rust Fund will be reduced over the years as the related debt is paid-off with funds received from the Redevelopment Property Tax Trust Fund (RPTTF), which is administered by the County Auditor-Controller.
20. Contruction Commitments
As of June 30, 2022, the Electric Utility had commitments (encumbrances) of approximately $19,409 with respect to ongoing capital projects, of which $8,380 is expected to be funded by bonds, $7,842 to be funded by unrestricted cash reserves, and $3,187 to be funded by restricted cash reserves.
21. Forward Purchase/Sale Agreements
In order to meet seasonal energy needs and summer peaking requirements, the Electric Utility contracts on a monthly and/or quarterly basis, for the purchase or sale of natural gas, electricity a nd/or capacity p roducts on a one to four year forward horizon. As of June 30, 2022, the Electric Utility has net natural gas and electricity c ommitments for fiscal year 2023 a nd thereafter, of approximately $70,840, with a market value of $77,296.
22. Economic Contingency
A portion of fund balance has been committed within the General Fund and Measure Z fund for future economic contingencies. The amount that has been set aside for the General Fund is $61,000 which equals to approximately 20% of the 2022-2023 G eneral Fund adopted expenditure budget. For the General Fund Measure Z Fund, $5,000 has been set aside.
76 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
23. Litigation
The City i s a defendant in various lawsuits arising in the normal course of business. Present lawsuits and other claims against the City a re incidental to the ordinary c ourse of operations and are largely c overed by t he City’s self- insurance program. In the opinion of management and the City Attorney, such claims and litigation will not have a materially adverse effect upon the financial position or results of operation of the City.
24. Tax Abatements
In November 2012, the City entered into a tax sharing agreement with a local business to incentivize an expansion of their facility. Assistance is provided in the form of a rebate of sales and property taxes over fifteen years in an amount not to exceed $4,500. The agreement expires on the earlier of: 1) total cumulative tax rebate of $4,500; or 2) fifteen years in fiscal 2027-28.
Incremental Sales Tax Revenue can be generated from sales, over the fiscal 2011-12 base period, reported to the State Board of Equalization at the business site and from third party v endor transactions occurring using the business site as the point of sale. I ncremental Property T ax Revenue is generated from the increase in County a ssessed valuation over the 2012-13 base period values, for the parcels designated in the agreement. For parcels acquired after 2012-13 in the project area, the acquisition price will become its base year valuation. The initial 2012-13 base year assessed valuation is $114,293 and has been adjusted to $125,043 for the parcels acquired in 2014-
15. The business is due 100% of the incremental Property tax revenue due to the City f rom the project area tax rate. It is calculated as 11% of the value determined from taking 1% of the difference of current net assessed valuation over the adjusted base valuation. The cumulative rebate payment as of June 30, 2022 is $1,331.
25. Subsequent Events
Parada II Litigation
On September 12, 2018, a petition for writ of mandate entitled Parada v. City of Riverside (“Parada II”) was filed against the City seeking to invalidate, rescind and void, under Proposition 26, the Electric System’s rates approved by C ity Council on May 22, 2018, which took effect on January 1, 2019, by challenging the portion of the electric rates that are attributable to the General Fund. The petition did not seek any monetary relief from the General Fund. The trial court divided the case into two stages for hearings: a liability phase and a damages phase. On April 17, 2020, the Court in the liability phase of Parada II litigation entered a tentative ruling finding the City’s electric rates attributable to the General Fund transfer violate Article XIII C of the California Constitution. The formal hearing on the matter took place on June 5, 2020, but the Court asked for further briefing on the issue of whether or not the plaintiffs failed to exhaust their administrative remedies. On October 9, 2020, the Court confirmed its tentative ruling and entered an order denying the City’s request for interlocutory remand. The court had set a hearing for February 2 4, 2021, to set a briefing schedule for determining appropriate remedies /damages in the case. The City expected the second phase of the trial relating to plaintiffs’ available remedies to occur in the second quarter of 2021.
The ruling by t he Court in Parada II was anticipated to likely h ave a material adverse impact on the City’s General Fund. The General Fund receives approximately $ 40 million annually ( up to the maximum amount of 11.5% of Electric Fund revenues) from the Electric Fund. Based on the Court’s order in the liability phase of the trial, approximately $19-32 million of the General Fund transfer is potentially attributable to rate payer revenue that was not approved by t he voters. However, that amount will be determined during the damages phase of the trial. Additionally, the City might have been required to refund rate payers for the portions of the rates that were determined to violate Article XIII C of the California Constitution from the date the writ of mandate was filed.
However, the trial court did not issue any ruling as to what the amount of any damages would be.
Based on the Court’s order in the liability phase of the trial, the City estimated that the amount of a refund would be $19 to $32 million per year, beginning January 1, 2019, until date of settlement or issuance of a final, non-appealable judgment by the trial court after anticipated appeals are resolved. This amount could vary d epending upon whether or not the City d ecides to repeal and replace the challenged rates pending appeal.
On May 1 7, 2021, the City a nd the Paradas entered into a conditional settlement agreement. This settlement was conditioned on: (1) the Riverside City Council’s placement of a ballot measure on City ballots in November 2021 to approve the City’s General Fund Transfer practices as a general tax (“Ballot Measure”); and (2) voter approval of the Ballot Measure. The Riverside City Council placed the Ballot Measure on the ballot for the November 2, 2021 election. The Parties stayed the Parada lawsuit until certification of the results of the Ballot Measure. If voters approved the Ballot Measure, the City would refund to customers of its electric utility an amount equal to $24 million less the amount awarded to Plaintiffs’ counsel in fees, paid over a five year period beginning no 77 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
later than February 1, 2022. If voters did not approve the Ballot Measure, this litigation would then resume.
On or about September 16, 2021, a petition for writ of mandate entitled Riversiders Against Increased Taxes v. City of Riverside, et al. (“RAIT lawsuit”) was filed against the City challenging the Ballot Measure on the grounds that the Ballot Measure cannot be adopted at the November 2021 election because that election is a “special” election and under Proposition 218, a ballot measure to impose a general tax can only be submitted to voters at a general election.
On November 9, 2021, the court set a trial date for the RAIT lawsuit for January 7, 2022 and ordered a stay o f the certification of the Ballot Measure Election results pending the January 7th hearing but did not otherwise delay or cancel the election for the Ballot Measure.
The election was held on November 2, 2021, and the Measure C was approved by voters, with 54.52 percent voting in favor.
On April 26, 2022 the RAIT lawsuit trial court determined that the November 2021 election was a “special election” rather than a “general election” and therefore did not comply w ith Proposition 218. The RAIT lawsuit trial court further ruled that it lacked power to enjoin the certification of election results or to otherwise invalidate the election. Both sides have since appealed that ruling.
On May 1 2, 2022, the City a nd the Paradas amended the May 1 7, 2021 Settlement Agreement, with the following additional terms: (a) City a greed to start making refunds to ratepayers by October 1, 2022; (b) if the City prevailed in the appeal of the trial court’s decision in the RAIT lawsuit, no additional refund would be due to the ratepayers; (c) if the City did not prevail in the appeal of the trial court’s decision in the RAIT lawsuit, an additional refund would be implemented in the amount of $705,882 per month, from November, 2021 up to when the City either (i) sets new electric rates; (ii) voters approve a valid ballot measure for the GFT or (iii) the City otherwise stops collecting the electric GFT.
The Parada lawsuit was dismissed on May 13, 2022.
The City C ouncil adopted a resolution certifying the results of the Measure C election on July 1 9, 2022. The plaintiffs from the RAIT lawsuit sought to intervene in the Parada lawsuit and set aside this dismissal. On August 3, 2022, the Parada trial court refused to set aside the dismissal. The City h as now begun to implement the settlement agreement.
26. Special and Extraordinary Items
The Refuse Fund, a non-major enterprise fund, reported a special item of $694 related to a financed purchase liability transferred from governmental activities for the purchase of vehicles.
The Electric Fund reported an extraordinary item of $5,748 in the Statement of Revenues, Expenses and Changes in Net Position as of June 30, 2022. In fiscal year 21/22, SCE provided the 2020 Decommissioning Cost Estimate report, which projected a material increase in costs for the Electric Utility over the life of the SONGS decommissioning project. As a result, it was determined that the decommissioning liability b e increased. For additional information related to SONGS, see Note 1 and 13.
27. Prior Period Adjustments
Effective July 1, 2021, the City adopted GASB's No. 87 - Leases, using the facts and circumstances that existed at the beginning of the period of implementation.
The standard requires that it is applied retroactively unless it is impractical to do so. Due to the sheer number of leases, the City considered it impractical to do so. As a result, there was no impact to the City's beginning net position upon adoption of the new accounting standard.
A prior period adjustment of $643 was made to the Sewer Enterprise Fund for previously e xpensed items which should have been included on the balance sheet as inventory.
The restatement of beginning net position of the Sewer Fund is summarized as follows:
Sewer Fund
Net position at July 1, 2021, as previously stated $ 234,398 Inventory adjustment 643
Net position at July 1, 2021 as restated $ 235,041
A prior period adjustment of $38,965 was made to the Custodial Fund for the removal of the long-term debt based upon additional guidance and clarification received subsequent to the first year implementation of GASB Statement No. 84, Fiduciary Activities.
78 CITY OF RIVERSIDE
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
The restatement of beginning net position of the Custodial Fund is summarized as follows:
Custodial Fund
Net position at July 1, 2021, as previously stated $ (29,922) Long-term debt adjustment 38,965
Net position at July 1, 2021 as restated $ 9,043
79 Required Supplementary Information
Consists of the following:
Schedule of Changes in Net Pension Liability and Related Ratios Schedule of Pension Plan Contributions
Schedule of Changes in Total OPEB Liability and Related Ratios 80 CITY OF RIVERSIDE
MISCELLANEOUS PLAN
SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS AS OF JUNE 30, FOR THE LAST TEN FISCAL YEARS (1)
(amounts expressed in thousands)
2014 2015 2016 2017 2018 2019 2020 2021
Total Pension Liability
Service cost $ 23,320 $ 22,228 $ 22,189 $ 24,766 $ 25,117 $ 25,017 $ 25,919 $ 26,168 Interest on total pension liability 84,965 87,436 90,913 92,725 92,595 96,836 101,080 105,017 Differences between expected and actual experience - (21,782) - 79,037 (37,885) 6,927 6,220 873 Changes in assumptions - (23,548) (8,417) (26,068) (19,805) - - - Benefit payments, including refunds of employee
contributions (50,770) (53,853) (57,702) (60,108) (63,483) (67,073) (71,266) (74,608) Net change in total pension liability 57,515 10,481 46,983 110,352 (3,461) 61,707 61,953 57,450 Total pension liability - beginning 1,146,583 1,204,098 1,214,579 1,261,562 1,371,914 1,368,453 1,430,160 1,492,113 Total pension liability - ending (a) $ 1,204,098 $ 1,214,579 $ 1,261,562 $ 1,371,914 $ 1,368,453 $ 1,430,160 $ 1,492,113 $ 1,549,563 Plan Fiduciary Net Position
Net Plan to Plan Resource Movement - - - - - - - (1)
Contributions - employer $ 27,583 $ 25,996 $ 29,426 $ 30,477 $ 29,920 $ 34,627 $ 239,156 $ 26,274 Contributions - employees 2,294 4,380 5,187 6,115 9,749 10,286 10,957 10,358 Net investment income 145,843 21,671 4,958 104,771 86,307 71,046 56,837 305,548 Benefit payments, including refunds of employee
contributions (50,770) (53,853) (57,702) (60,108) (63,483) (67,073) (71,266) (74,608) Administrative and other income/(expenses) - (1,056) (594) (1,290) (4,664) (776) (1,604) (1,371) Net change in fiduciary net position 124,950 (2,862) (18,725) 79,965 57,829 48,110 234,080 266,200 Plan fiduciary net position - beginning 848,699 973,649 970,787 952,062 1,032,027 1,089,856 1,137,966 1,372,046 Plan fiduciary net position - ending (b) $ 973,649 $ 970,787 $ 952,062 $ 1,032,027 $ 1,089,856 $ 1,137,966 $ 1,372,046 $ 1,638,246 Plan net pension liability/(assets) - ending (a) - (b) $ 230,449 $ 243,792 $ 309,500 $ 339,887 $ 278,597 $ 292,194 $ 120,067 $ (88,683) Plan fiduciary net position as a percentage of the total pension liability %80.86 %79.93 %75.47 %75.23 %79.64 %79.57 %91.95 %105.72 Covered payroll $ 109,990 $ 110,891 $ 118,512 $ 117,637 $ 121,957 $ 128,881 $ 131,492 $ 131,216 Plan net pension liability/(asset) as a percentage of
covered payroll %209.52 %219.85 %261.15 %288.93 %228.44 %226.72 %91.31 %(67.59) (1) Historical information is required only for measurement for which GASB 68 is applicable. Fiscal Year 2015 was the first year of implementation. Future years' information will be displayed up to 10 years as information becomes available.
(2) Net of administrative expenses.
Notes to Schedule:
Benefit Changes: There was no changes in benefits.
Changes of Assumptions:
In fiscal year 2016-17, the discount rate was changed from 7.65 percent (net of administrative expense) to 7.15 percent.
In fiscal year 2017-18, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study and Review of Actuarial Assumptions December 2017.
There were no changes in the discount rate.
81 CITY OF RIVERSIDE
SAFETY PLAN
SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS AS OF JUNE 30, FOR THE LAST TEN FISCAL YEARS (1)
(amounts expressed in thousands)
2014 2015 2016 2017 2018 2019 2020 2021
Total Pension Liability
Service cost $ 18,818 $ 18,187 $ 18,144 $ 21,373 $ 20,390 $ 21,454 $ 22,391 $ 23,160 Interest on total pension liability 62,249 64,815 67,513 70,337 73,104 76,922 80,940 84,654 Differences between expected and actual experience - (16,117) - 59,768 (4,644) 10,897 11,896 6,361 Changes in assumptions - (6,835) (4,373) (18) 868 - - - Benefit payments, including refunds of employee
contributions (38,981) (42,076) (44,609) (47,009) (50,477) (52,564) (56,537) (59,739) Net change in total pension liability 42,086 17,974 36,675 104,451 39,241 56,709 58,690 54,436 Total pension liability - beginning 840,067 882,153 900,127 936,802 1,041,253 1,080,494 1,137,203 1,195,893 Total pension liability - ending (a) $ 882,153 $ 900,127 $ 936,802 $ 1,041,253 $ 1,080,494 $ 1,137,203 $ 1,195,893 $ 1,250,329 Plan Fiduciary Net Position
Net Plan to Plan Resource Movement - - - - - - - 1
Contributions - employer $ 23,156 $ 23,384 $ 26,483 $ 26,775 $ 25,451 $ 29,254 $ 263,061 $ 22,931 Contributions - employees 365 924 1,837 2,449 6,402 7,679 9,454 10,492 Net investment income 107,032 15,632 3,478 76,844 62,933 51,750 41,765 242,945 Benefit payments, including refunds of employee
contributions (38,981) (42,076) (44,609) (47,009) (50,478) (52,564) (56,537) (59,739) Administrative and other income/(expenses) - (816) (428) (1,145) (3,403) (567) (1,170) (1,085) Net change in fiduciary net position 91,572 (2,952) (13,239) 57,914 40,905 35,552 256,573 215,545 Plan fiduciary net position - beginning 620,069 711,641 708,689 695,450 753,364 794,269 829,821 1,086,394 Plan fiduciary net position - ending (b) $ 711,641 $ 708,689 $ 695,450 $ 753,364 $ 794,269 $ 829,821 $ 1,086,394 $ 1,301,939 Plan net pension liability/(assets) - ending (a) - (b) $ 170,512 $ 191,438 $ 241,352 $ 287,889 $ 286,225 $ 307,382 $ 109,499 $ (51,610) Plan fiduciary net position as a percentage of the total pension liability %80.67 %78.73 %74.24 %72.35 %73.51 %72.97 %90.84 %104.13 Covered payroll $ 63,734 $ 63,612 $ 68,707 $ 66,226 $ 68,251 $ 73,237 $ 76,955 $ 78,813 Plan net pension liability/(asset) as a percentage of
covered payroll %267.54 %300.95 %351.28 %434.71 %419.37 %419.71 %142.29 %(65.48) (1) Historical information is required only for measurement for which GASB 68 is applicable. Fiscal year 2015 was the first year of implementation. Future years' information will be displayed up to 10 years as information becomes available.
(2) Net of administrative expenses.
Notes to Schedule:
Benefit Changes: There was no changes in benefits.
Changes of Assumptions:
In fiscal year 2016-17, the discount rate was changed from 7.65 percent (net of administrative expense) to 7.15 percent.
In fiscal year 2017-18, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study and Review of Actuarial Assumptions December 2017.
There were no changes in the discount rate.
82 CITY OF RIVERSIDE
SCHEDULE OF PENSION PLAN CONTRIBUTIONS
AS OF JUNE 30, FOR THE LAST TEN FISCAL YEARS (1)
(amounts expressed in thousands)
2014 2015 2016 2017 2018 2019 2020 2021 2022
Miscellaneous Plan
Actuarially determined contribution $ 20,505 $ 21,063 $ 24,885 $ 26,955 $ 29,948 $ 34,486 $ 38,889 $ 26,274 $ 27,330 Contribution in relation to the actuarially determined
contribution (27,584) (25,997) (29,426) (30,477) (29,948) (34,486) (239,220) (26,274) (27,330) Contribution deficiency/(excess) $ (7,079) $ (4,934) $ (4,541) $ (3,522) $- $- $ (200,331) $- $- Covered payroll $ 109,990 $ 110,891 $ 118,512 $ 117,637 $ 121,957 $ 128,881 $ 131,492 $ 131,216 $ 130,060 Contributions as a percentage of covered payroll % 25.08 % 23.44 % 24.83 % 25.91 % 24.56 % 26.76 % 181.93 % 20.02 % 21.01 Safety Plan
Actuarially determined contribution $ 17,341 $ 18,452 $ 21,886 $ 23,076 $ 25,289 $ 29,047 $ 32,785 $ 22,925 $ 24,773 Contribution in relation to the actuarially determined
contribution (23,156) (23,384) (26,483) (26,775) (25,289) (29,047) (263,016) (22,925) (24,773) Contribution deficiency/(excess) $ (5,815) $ (4,932) $ (4,597) $ (3,699) $- $- $ (230,231) $- $- Covered payroll $ 63,734 $ 63,612 $ 68,707 $ 66,226 $ 68,251 $ 73,237 $ 76,955 $ 78,813 $ 77,338 Contributions as a percentage of covered payroll % 36.33 % 36.76 % 38.54 % 40.43 % 37.05 % 39.66 % 341.78 % 29.09 % 32.03 (1) Historical information is required only for measurement for which GASB 68 is applicable. Fiscal Year 2015 was the first year of implementation.
Notes to Schedule:
Actuarial valuation date: June 30, 2019
Actuarial cost method: Entry Age Normal
Source
(Gain)/Loss
Driver Investment
Non-
Investment
Assumption/
Method Change
Benefit
Change
Golden
Handshake
Amortization of unfunded actuarial accrued liability: Amortization period 30 Years 30 Years 20 Years 20 Years 5 Years Escalation rate
- Active plans 2.75% 2.75% 2.75% 2.75% 2.75%
- Inactive plans 0% 0% 0% 0% 0%
Ramp up 55 5 00
Ramp down 55 5 00
Asset valuation method: Fair value of assets
Discount rate: 7.0%
Overall payroll growth: 2.75%
Inflation: 2.5%
Retirement age: 2019 CalPERS experience study
Mortality: 2019 CalPERS Experience Study, with ongoing improvement using 90 percent of Scale MP-2016 83 CITY OF RIVERSIDE
SCHEDULE OF CHANGES IN TOTAL OPEB LIABILITY AND RELATED RATIOS AS OF JUNE 30, FOR THE LAST TEN FISCAL YEARS (1)
(amounts expressed in thousands)
Reporting period June 30, 2018 2019 2020 2021 2022
Measurement period June 30, 2017 2018 2019 2020 2021
Total OPEB liability
Service cost $ 2,554 $ 2,403 $ 2,435 $ 2,569 $ 2,646
Interest on the total OPEB liability 1,090 1,301 1,392 1,810 1,394 Differences between expected and actual experience - - 292 (2,300) (2,267) Changes in assumptions (1,668) (306) 9,550 2,225 (3,086) Benefit payments (1,732) (1,846) (2,003) (2,032) (2,193) Net change in total OPEB liability 244 1,552 11,666 2,272 (3,506) Total OPEB liability - beginning 36,542 36,786 38,338 50,004 52,276 Total OPEB liability - ending $ 36,786 $ 38,338 $ 50,004 $ 52,276 $ 48,770 Covered payroll $ 170,858 $ 170,858 $ 185,967 $ 191,546 $ 197,292 Total OPEB liability as a percentage of covered-employee payroll %21.53 %22.44 %26.89 %27.29 %24.72 (1) Historical information is required only for the measurement periods for which GASB 75 is applicable. Fiscal Year 2018 was the first year of implementation. Future years' information will be displayed up to 10 years as information becomes available.
Notes to Schedule:
Changes in assumptions: For the measurement period ending June 30, 2021, the discount rate was changed from 2.66 percent to 2.16 percent.
There are no asset accumulated in a trust that meets the criteria of GASB codification P22.101 or P52.101 to pay related benefits for the OPEB plan. 84 Non-Major Governmental Funds
Special Revenue Funds
Special Revenue Funds are used to account for specific revenues that are legally restricted to expenditure for particular purposes.
Urban Areas Security Initiative (UASI) Fund - To account for UASI grants received from the U.S. Department of Homeland Security.
Grants and Restricted Programs Fund - To account for federal, state, and local grants along with other restricted program revenue.
Gas Tax Fund - To account for the construction and maintenance of the road network system of the City. Financing is provided by the City's share of state gasoline taxes which state law requires to be used to maintain streets.
Air Quality Improvements Fund - To account for qualified air pollution reduction programs funded by the South Coast Air Quality Management District.
Housing & Community Development Fund - To account for federal grants received from the Department of Housing and Urban Development (HUD). The grants are used for the development of a viable urban community b y providing decent housing, a suitable living environment, and expanding economic opportunities, principally for persons with low and moderate incomes.
National Pollution Discharge Elimination System (NPDES) Storm Drain Fund - T o account for storm drain maintenance and inspection required for California storm water permits. Activities are funded by a special assessment district of Riverside County, California.
Special Districts Fund - T o account for Loving Homes, Village at Canyon Crest, Sycamore Highlands, Riverwalk, Riverwalk Parks Projects, and Street Lighting districts.
Housing Fund - To account for the housing activities for persons with low or moderate income.
Capital Projects Funds
Capital Projects Funds are used to account for the acquisition and construction of major capital facilities other than those financed by proprietary funds.
Special Capital Improvement Fund - T o account for the acquisition, construction and installation of capital improvements and a Community F acilities District within the City.
Storm Drain Fund - To account for the acquisition, construction and installation of storm drains in the City.
Transportation Fund - T o account for the construction and installation of street and highway improvements in accordance with Articles 3 and 8 of the Transportation Development Act of 1971 of the State of California.
Permanent Fund
Permanent Funds are used to report resources that are legally restricted to the extent that only earnings, not principal, may be used for purposes that support the reporting government's programs.
Library Special Fund - To account for the monies held in trust for the benefit of the Riverside City Public Library System. 85 CITY OF RIVERSIDE
COMBINING BALANCE SHEET
NON-MAJOR GOVERNMENTAL FUNDS
JUNE 30, 2022
(amounts expressed in thousands)
Special Revenue Funds
Urban Areas
Security
Initiative
Grants and
Restricted
Programs Gas Tax
Air Quality
Improvements
Housing &
Community
Development
NPDES Strom
Drain
Special
Districts Housing Total
Assets:
Cash and investments $ - $ 78,996 $ 29,695 $ 1,681 $ 4,948 $ 41 $ 676 $ 10,113 $ 126,150 Cash and investments with fiscal agent - - - - - - - - - Receivables, net of allowance for uncollectible
Interest - 103 62 3 13 - 1 21 203
Property taxes - - - - - - 98 - 98
Accounts - 91 - - 17 - - 13 121
Intergovernmental 2,129 5,063 1,327 104 5,777 566 - - 14,966 Notes - - - - 14,119 - - 31,457 45,576
Prepaid items - 101 - - 129 - - - 230
Land and improvements held for resale - - - - 443 - - 2,392 2,835 Total assets $ 2,129 $ 84,354 $ 31,084 $ 1,788 $ 25,446 $ 607 $ 775 $ 43,996 $ 190,179 Liabilities, Deferred Inflows of Resources,
and Fund Balances:
Liabilities:
Accounts payable $ 1,298 $ 5,263 $ 385 $ - $ 1,689 $ - $ 33 $ 228 $ 8,896 Accrued payroll - 6 - - 9 6 - 18 39
Retainage payable - 10 939 - 70 - - 1 1,020
Intergovernmental - - - - - - 1 - 1
Unearned revenue - 75,583 - - 8,331 - - - 83,914
Due to other funds 831 - - - - - - - 831
Total liabilities 2,129 80,862 1,324 - 10,099 6 34 247 94,701 Deferred Inflows of Resources:
Unavailable revenue - 1,813 - - 16,562 - - 31,457 49,832 Total deferred inflows of resources - 1,813 - - 16,562 - - 31,457 49,832 Fund Balances:
Nonspendable:
Permanent fund principal - - - - - - - - -
Restricted:
Housing and redevelopment - - - - - - - 12,292 12,292
Transportation and public works - 1,679 29,760 1,788 - 601 741 - 34,569 Other purposes - - - - - - - - -
Unassigned: - - - - (1,215) - - - (1,215)
Total fund balances - 1,679 29,760 1,788 (1,215) 601 741 12,292 45,646 Total liabilities, deferred inflows of
resources, and fund balances $ 2,129 $ 84,354 $ 31,084 $ 1,788 $ 25,446 $ 607 $ 775 $ 43,996 $ 190,179 86 CITY OF RIVERSIDE
COMBINING BALANCE SHEET
NON-MAJOR GOVERNMENTAL FUNDS
JUNE 30, 2022
(amounts expressed in thousands)
Capital Projects Funds Permanent Fund
Special
Capital
Improvement Storm Drain Transportation Total Library Special Total
Non-Major
Governmental
Funds
Assets:
Cash and investments $ 6,319 $ 2,528 $ - $ 8,847 $ 1,495 $ 136,492 Cash and investments with fiscal agent 665 - - 665 - 665 Receivables, net of allowance for uncollectible
Interest 13 7 - 20 - 223
Property taxes - - - - - 98
Accounts - - - - - 121
Intergovernmental - - - - - 14,966
Notes - - - - - 45,576
Prepaid items - - - - - 230
Land and improvements held for resale - - - - - 2,835
Total assets $ 6,997 $ 2,535 $ - $ 9,532 $ 1,495 $ 201,206 Liabilities, Deferred Inflows of Resources, and Fund Balances:
Liabilities:
Accounts payable $ 31 $ 650 $ - $ 681 $ - $ 9,577
Accrued payroll - - - - - 39
Retainage payable 5 - - 5 - 1,025
Intergovernmental - - - - - 1
Unearned revenue - 1,495 - 1,495 - 85,409
Due to other funds - - - - - 831
Total liabilities 36 2,145 - 2,181 - 96,882
Deferred Inflows of Resources:
Unavailable revenue - - - - - 49,832
Total deferred inflows of resources - - - - - 49,832
Fund Balances:
Nonspendable:
Permanent fund principal - - - - 1,495 1,495
Restricted:
Housing and redevelopment - - - - - 12,292
Transportation and public works - - - - - 34,569
Other purposes 6,961 390 - 7,351 - 7,351
Unassigned: - - - - - (1,215)
Total fund balances 6,961 390 - 7,351 1,495 54,492
Total liabilities, deferred inflows of resources, and fund balances $ 6,997 $ 2,535 $ - $ 9,532 $ 1,495 $ 201,206 87 CITY OF RIVERSIDE
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
NON-MAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Special Revenue Funds
Urban Areas
Security
Initiative
Grants and
Restricted
Programs Gas Tax
Air Quality
Improvements
Housing &
Community
Development
NPDES Strom
Drain
Special
Districts Housing Total
Revenues:
Licenses and permits $ - $ - $ - $ - $ - $ - $ - $ - $ - Intergovernmental 2,572 16,490 14,120 419 27,678 - - - 61,279 Charges for services - 1,580 - 47 - - - - 1,627
Special assessments - - - - - 980 4,120 - 5,100
Rental and investment income - 442 (753) (40) (34) (1) 1 (6) (391) Miscellaneous - 789 - 10 232 - - 539 1,570
Total revenues 2,572 19,301 13,367 436 27,876 979 4,121 533 69,185 Expenditures:
Current:
General government - 9,871 - 93 2,487 - - 3,631 16,082
Public safety 2,572 5,391 - - - - 4,636 - 12,599
Highways and streets - 280 - - - - 590 - 870
Culture and recreation - 1,993 - - - - 39 - 2,032
Capital outlay - 222 8,479 - 29,660 982 - - 39,343
Debt service:
Principal - - - - 19 - - 43 62
Interest and fiscal charges - - - - 14 - - 30 44
Total expenditures 2,572 17,757 8,479 93 32,180 982 5,265 3,704 71,032 Excess/(deficiency) of revenues
over/(under) expenditures - 1,544 4,888 343 (4,304) (3) (1,144) (3,171) (1,847) Other Financing Sources/(Uses):
Transfers in - 608 - - - - 1,410 - 2,018
Transfers out - (1,610) - - - - - (1) (1,611)
Proceeds from sale of capital assets - 6 - - - - - - 6
Proceeds from financing related to leases - - - - - 1 - - 1 Total other financing
sources/(uses) - (996) - - - 1 1,410 (1) 414
Net change in fund balances - 548 4,888 343 (4,304) (2) 266 (3,172) (1,433) Fund Balances:
Beginning of year - 1,131 24,872 1,445 3,089 603 475 15,464 47,079 End of year $ - $ 1,679 $ 29,760 $ 1,788 $ (1,215) $ 601 $ 741 $ 12,292 $ 45,646 88 CITY OF RIVERSIDE
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
NON-MAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Capital Projects Funds
Permanent
Fund
Special
Capital
Improvement Storm Drain Transportation Total Library Special Total
Non-Major
Governmental
Funds
Revenues:
Licenses and permits $ 3,393 $ 153 $ - $ 3,546 $ - $ 3,546 Intergovernmental - 8,428 - 8,428 - 69,707
Charges for services - - - - - 1,627
Special assessments - - - - - 5,100
Rental and investment income (164) (137) - (301) 12 (680) Miscellaneous - 2 - 2 157 1,729
Total revenues 3,229 8,446 - 11,675 169 81,029
Expenditures:
Current:
General government 50 - - 50 - 16,132
Public safety - - - - - 12,599
Highways and streets - - - - - 870
Culture and recreation - - - - 151 2,183
Capital outlay 194 8,605 - 8,799 - 48,142
Debt service:
Principal - - - - - 62
Interest and fiscal charges - - - - - 44
Total expenditures 244 8,605 - 8,849 151 80,032
Excess/(deficiency) of revenues over/(under) expenditures 2,985 (159) - 2,826 18 997 Other Financing Sources/(Uses):
Transfers in - - - - - 2,018
Transfers out (1,750) - - (1,750) - (3,361)
Proceeds from sale of capital assets - - - - - 6
Proceeds from financing related to leases - - - - - 1
Total other financing sources/(uses) (1,750) - - (1,750) - (1,336) Net change in fund balances 1,235 (159) - 1,076 18 (339) Fund Balances:
Beginning of year 5,726 549 - 6,275 1,477 54,831
End of year $ 6,961 $ 390 $ - $ 7,351 $ 1,495 $ 54,492
89 CITY OF RIVERSIDE
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
NON-MAJOR SPECIAL REVENUE FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Urban Areas Security Initiative Grants and Restricted Programs Gas Tax Final
Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Final
Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Final
Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Revenues:
Intergovernmental $ 11,089 $ 2,572 $ (8,517) $ 94,511 $ 16,490 $ (78,021) $ 14,567 $ 14,120 $ (447) Charges for services - - - 1,598 1,580 (18) - - -
Rental and investment income - - - - 442 442 150 (753) (903) Miscellaneous - - - 897 789 (108) - - -
Total revenues 11,089 2,572 (8,517) 97,006 19,301 (77,705) 14,717 13,367 (1,350) Expenditures:
Current:
General government - - - 46,680 9,871 36,809 - - -
Public safety 11,089 2,572 8,517 11,887 5,391 6,496 - - - Highways and streets - - - 1,410 280 1,130 - - -
Culture and recreation - - - 26,115 1,993 24,122 - - -
Capital outlay - - - 8,027 222 7,805 36,861 8,479 28,382 Total expenditures 11,089 2,572 8,517 94,119 17,757 76,362 36,861 8,479 28,382 Excess/(deficiency) of revenues
over/(under) expenditures - - - 2,887 1,544 (1,343) (22,144) 4,888 27,032 Other Financing Sources/(Uses):
Transfers in - - - 1,036 608 (428) - - -
Transfers out - - - (2,569) (1,610) 959 - - -
Proceeds from sale of capital assets - - - - 6 6 - - -
Total other financing
sources/(uses) - - - (1,533) (996) 537 - - -
Net change in fund balance - - - 1,354 548 (806) (22,144) 4,888 27,032 Fund Balances:
Beginning of year - - - 1,131 1,131 - 24,872 24,872 -
End of year $ - $ - $ - $ 2,485 $ 1,679 $ (806) $ 2,728 $ 29,760 $ 27,032 90 CITY OF RIVERSIDE
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
NON-MAJOR SPECIAL REVENUE FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Air Quality Improvements Housing & Community Development NPDES Strom Drain Final
Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Final
Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Final
Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Revenues:
Intergovernmental $ 420 $ 419 $ (1) $ 58,362 $ 27,678 $ (30,684) $ - $ - $ - Charges for services 130 47 (83) - - - - - -
Special assessments - - - - - - 1,716 980 (736)
Rental and investment income - (40) (40) 54 (34) (88) - (1) (1) Miscellaneous - 10 10 1,268 232 (1,036) - - -
Total revenues: 550 436 (114) 59,684 27,876 (31,808) 1,716 979 (737) Expenditures:
Current:
General government 635 93 542 4,375 2,487 1,888 - - -
Capital outlay 242 - 242 71,777 29,660 42,117 1,925 982 943 Debt service:
Principal - - - 19 19 - - - -
Interest and fiscal charges - - - 14 14 - - - -
Total expenditures 877 93 784 76,185 32,180 44,005 1,925 982 943 Excess/(deficiency) of revenues
over/(under) expenditures (327) 343 670 (16,501) (4,304) 12,197 (209) (3) 206 Other Financing Sources/(Uses):
Transfers in - - - - - - - - -
Transfers out - - - - - - - - -
Proceeds from financing related to
leases - - - - - - - 1 1
Total other financing
sources/(uses) - - - - - - - 1 1
Net change in fund balances (327) 343 670 (16,501) (4,304) 12,197 (209) (2) 207 Fund Balances:
Beginning of year 1,445 1,445 - 3,089 3,089 - 603 603 - End of year $ 1,118 $ 1,788 $ 670 $ (13,412) $ (1,215) $ 12,197 $ 394 $ 601 $ 207 91 CITY OF RIVERSIDE
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
NON-MAJOR SPECIAL REVENUE FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Special Districts Housing
Final
Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Final
Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Revenues
Special assessments $ 4,079 $ 4,120 $ 41 $ - $ - $ -
Rental and investment income - 1 1 - (6) (6)
Miscellaneous - - - - 539 539
Total revenues 4,079 4,121 42 - 533 533
Expenditures:
Current:
General government - - - 4,887 3,631 1,256
Public safety 4,712 4,636 76 - - -
Highways and streets 764 590 174 - - -
Culture and recreation 314 39 275 - - -
Debt service:
Principal - - - 43 43 -
Interest and fiscal charges - - - 30 30 -
Total expenditures 5,790 5,265 525 4,960 3,704 1,256
Excess/(deficiency) of revenues over/(under) expenditures (1,711) (1,144) 567 (4,960) (3,171) 1,789 Other Financing Sources/(Uses):
Transfers in 1,415 1,410 (5) - - -
Transfers out - - - (1) (1) -
Total other financing sources/(uses) 1,415 1,410 (5) (1) (1) - Net change in fund balances (296) 266 562 (4,961) (3,172) 1,789 Fund Balances:
Beginning of year 475 475 - 15,464 15,464 -
End of year $ 179 $ 741 $ 562 $ 10,503 $ 12,292 $ 1,789 92 CITY OF RIVERSIDE
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
CAPITAL PROJECT FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Capital Outlay Fund Special Capital Improvement Storm Drain Final
Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Final
Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Final
Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Revenues:
Licenses and permits $ - $ - $ - $ 2,560 $ 3,393 $ 833 $ 195 $ 153 $ (42) Intergovernmental 52,369 13,830 (38,539) - - - 29,243 8,428 (20,815) Special assessments 787 538 (249) - - - - - -
Rental and investment income 180 (1,437) (1,617) 20 (164) (184) 13 (137) (150) Miscellaneous 369 742 373 - - - - 2 2
Total revenues 53,705 13,673 (40,032) 2,580 3,229 649 29,451 8,446 (21,005) Expenditures:
Current:
General government - - - 50 50 - - - -
Capital outlay 105,622 20,130 85,492 1,365 194 1,171 29,892 8,605 21,287 Debt service:
Interest and fiscal charges 2 4 (2) - - - - - -
Total expenditures 105,624 20,134 85,490 1,415 244 1,171 29,892 8,605 21,287 Excess/(deficiency) of revenues
over/(under) expenditures (51,919) (6,461) 45,458 1,165 2,985 1,820 (441) (159) 282 Other Financing Sources/(Uses):
Transfers in 11,325 11,651 326 - - - - - -
Transfers out (3,045) (3,045) - (1,750) (1,750) - - - - Total other financing
sources/(uses) 8,280 8,606 326 (1,750) (1,750) - - - -
Net change in fund balance (43,639) 2,145 45,784 (585) 1,235 1,820 (441) (159) 282 Fund Balances:
Beginning of year 50,359 50,359 - 5,726 5,726 - 549 549 - End of year $ 6,720 $ 52,504 $ 45,784 $ 5,141 $ 6,961 $ 1,820 $ 108 $ 390 $ 282 93 CITY OF RIVERSIDE
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
CAPITAL PROJECT FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Transportation
Final Budget
Actual
Amounts
Variance to
Final Budget
Positive
(Negative)
Revenues:
Intergovernmental $ 268 $ - $ (268)
Total revenues 268 - (268)
Expenditures:
Capital outlay 268 - 268
Total expenditures 268 - 268
Other Financing Sources/(Uses):
Transfers in - - -
Fund Balances:
Beginning of year - - -
End of year $ - $ - $ -
94 Non-Major Enterprise Funds
Enterprise Funds are used to account for the operations that are financed and operated in a manner similar to private business enterprises. The City's intent is to demonstrate that the cost of services provided to the general public on a continuing basis is financed or recovered through user charges; or the City has decided that the periodic determination of net income is appropriate for accountability purposes.
Airport - To account for the operations of the City's airport.
Refuse - To account for the operations of the City's solid waste and sanitation program which provides for the collection and disposal of solid waste on a user charge basis to residents and businesses.
Transportation - To account for the operations of the City's Senior Citizens' and Handicapped Transportation System in accordance with Article 4 of the Transportation Development Act of 1971 (SB325) of the State of California. Federal Transit Administration Funds are also accounted for in this fund.
Public Parking - To account for the operations and construction of the City's public parking facilities.
Civic Entertainment - To account for the operations of the Riverside Fox Theater, Riverside Municipal Auditorium, The Box and Showcase, the Riverside Convention Center, and the Cheech.
95 CITY OF RIVERSIDE
COMBINING STATEMENT OF NET POSITION
NON-MAJOR ENTERPRISE FUNDS
JUNE 30, 2022
(amounts expressed in thousands)
Business-Type Activities - Enterprise Funds
Airport Refuse Transportation Public Parking
Civic
Entertainment
Total
Non-Major
Enterprise
Funds
Assets:
Current assets:
Cash and investments $ 1,610 $ 3,097 $ 3,279 $ 1,994 $ 2,180 $ 12,160 Receivables, net of allowance for uncollectible
Interest 7 13 7 5 6 38
Utility billed - 3,458 - - - 3,458
Utility unbilled - 1,053 - - - 1,053
Accounts 171 292 1 466 1,886 2,816
Property taxes 20 - - - - 20
Intergovernmental 1 - 1,533 26 3,135 4,695
Lease receivable 371 - - 569 - 940
Inventory - - - - 79 79
Prepaid items - 3 - - 35 38
Deposits - - - - 306 306
Restricted assets:
Cash and cash equivalents - 2,500 - - - 2,500
Total current assets 2,180 10,416 4,820 3,060 7,627 28,103 Noncurrent assets:
Lease receivable 2,460 - - 2,340 - 4,800
Regulatory assets - 9,588 - - - 9,588
Derivative instruments - - - - 269 269
Net pension asset 302 2,089 1,192 534 - 4,117
Capital assets, net of accumulated depreciation 21,018 3,604 2,207 28,226 90,984 146,039 Right to use assets, net of amortization 6 3 6 240 - 255 Total noncurrent assets 23,786 15,284 3,405 31,340 91,253 165,068 Total assets 25,966 25,700 8,225 34,400 98,880 193,171
Deferred Outflows of Resources:
Changes in derivative values - - - - 1,983 1,983
Deferred charge on refunding - - - - 646 646
Pension related items 105 731 417 187 - 1,440
OPEB related items 26 218 145 29 - 418
Total deferred outflows of resources 131 949 562 216 2,629 4,487 (Continued)
96 CITY OF RIVERSIDE
COMBINING STATEMENT OF NET POSITION
NON-MAJOR ENTERPRISE FUNDS
JUNE 30, 2022
(amounts expressed in thousands)
Business-Type Activities - Enterprise Funds
Airport Refuse Transportation Public Parking
Civic
Entertainment
Total
Non-Major
Enterprise
Funds
Liabilities:
Current liabilities:
Accounts payable 69 2,458 7 663 1,006 4,203
Accrued payroll 12 85 35 22 - 154
Retainage payable 19 - - - 478 497
Unearned revenue 45 - 4,619 - 1,488 6,152
Deposits - - - - 648 648
Accrued interest - - - 49 - 49
Total current liabilities 145 2,543 4,661 734 3,620 11,703 Noncurrent liabilities:
Due within one year:
Long-term obligations 52 394 148 1,180 4,020 5,794
Compensated absences 65 294 117 25 - 501
Landfill capping - 559 - - - 559
Lease liability 1 1 2 75 - 79
Due in more than one year:
Long-term obligations 684 4,630 2,144 13,858 57,922 79,238 Compensated absences 13 61 25 5 - 104
Landfill capping - 9,261 - - - 9,261
Regulatory liability - - - - 34 34
Derivative instruments - - - - 2,726 2,726
OPEB liability 161 1,414 728 302 - 2,605
Lease liability 4 3 5 167 - 179
Total noncurrent liabilities 980 16,617 3,169 15,612 64,702 101,080 Total liabilities 1,125 19,160 7,830 16,346 68,322 112,783 Deferred Inflows of Resources:
Change in derivative values - - - - 252 252
Pension related items 507 3,514 2,004 897 - 6,922
OPEB related items 19 167 99 32 - 317
Lease related items 2,866 - - 2,947 - 5,813
Total deferred inflows of resources 3,392 3,681 2,103 3,876 252 13,304 Net Position:
Net investment in capital assets 21,018 3,011 2,207 14,322 29,688 70,246 Landfill capping - 2,500 - - - 2,500
Unrestricted/(deficit) 562 (1,703) (3,353) 72 3,247 (1,175) Total net position $ 21,580 $ 3,808 $ (1,146) $ 14,394 $ 32,935 $ 71,571 97 CITY OF RIVERSIDE
COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION
NON-MAJOR ENTERPRISE FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Business-Type Activities - Enterprise Funds
Airport Refuse Transportation Public Parking
Civic
Entertainment
Total
Non-Major
Enterprise
Funds
Operating Revenues:
Charges for services $ 1,728 $ 29,768 $ 168 $ 4,888 $ 11,883 $ 48,435 Total operating revenues 1,728 29,768 168 4,888 11,883 48,435 Operating Expenses:
Personnel services 529 3,897 1,816 63 - 6,305
Contractual services 175 6,842 51 1,845 6,646 15,559
Maintenance and operation 193 9,604 433 581 70 10,881
General 252 4,740 696 414 10,193 16,295
Materials and supplies 12 1,623 145 5 - 1,785
Claims/Insurance 41 182 93 95 239 650
Depreciation 717 837 448 855 2,525 5,382
Amortization 1 565 2 74 - 642
Total operating expenses 1,920 28,290 3,684 3,932 19,673 57,499 Operating income/(loss) (192) 1,478 (3,516) 956 (7,790) (9,064) Nonoperating Revenues/(Expenses):
Grant subsidies 7 - 2,379 - 3,480 5,866
Interest revenue 4 (160) (68) (2) (47) (273)
Interest expense and fiscal charges (24) (159) (74) (634) (2,131) (3,022) Other 23 1 - (77) 127 74
Total nonoperating revenues/(expenses): 10 (318) 2,237 (713) 1,429 2,645 Income/(loss) before contributions and transfers (182) 1,160 (1,279) 243 (6,361) (6,419) Capital contributions 52 - 293 - 6,694 7,039
Special item - (694) - - - (694)
Transfers in - 694 - 1,300 11,279 13,273
Transfers out (1) (331) (3) (1) - (336)
Change in net position (131) 829 (989) 1,542 11,612 12,863 Net Position
Beginning of year, as previously stated 21,711 2,979 (157) 12,852 21,323 58,708 End of year $ 21,580 $ 3,808 $ (1,146) $ 14,394 $ 32,935 $ 71,571 98 CITY OF RIVERSIDE
COMBINING STATEMENT OF CASH FLOWS
NON-MAJOR ENTERPRISE FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Business-Type Activities - Enterprise Funds
Airport Refuse Transportation Public Parking
Civic
Entertainment
Total
Non-Major
Enterprise
Funds
Cash Flows from Operating Activities:
Cash received from customers and users $ 1,818 $ 28,568 $ 3,293 $ 5,083 $ 12,073 $ 50,835 Cash paid to suppliers for goods or services (716) (22,859) (1,516) (2,715) (16,765) (44,571) Cash paid to employees for services (668) (4,730) (2,232) (286) - (7,916) Net cash provided/(used) by operating activities 434 979 (455) 2,082 (4,692) (1,652) Cash Flows from Non-Capital Financing Activities:
Transfers in - 694 - 1,300 11,279 13,273
Transfers out (1) (1,025) (3) (1) - (1,030)
Payment made to other funds - - - - (3,002) (3,002)
Payment on pension obligation bonds (43) (231) (117) (61) - (452) Other receipts/(payments) from non-operating revenue 58 1 - (40) 127 146 Grant subsidies 7 - 2,379 - 3,480 5,866
Net cash provided/(used) by non-capital financing activities 21 (561) 2,259 1,198 11,884 14,801 Cash Flows from Capital and Related Financing Activities:
Purchase of capital assets (229) (53) (73) (881) (6,694) (7,930) Principal paid on long-term obligations - (101) - (410) (1,216) (1,727) Interest paid on long-term obligations (24) (159) (74) (1,287) (4,950) (6,494) Contributions 52 694 293 - 6,694 7,733
Lease payments (1) (1) (2) (76) - (80)
Net cash provided/(used) by capital and related financing activities (202) 380 144 (2,654) (6,166) (8,498) Cash Flows from Investing Activities:
Interest from investments (2) (165) (74) (4) (53) (298) Net cash provided/(used) by investing activities (2) (165) (74) (4) (53) (298) Net increase/(decrease) in cash and cash equivalents 251 633 1,874 622 973 4,353 Cash and cash equivalents at beginning of year 1,359 4,964 1,405 1,372 1,207 10,307 Cash and cash equivalents at end of year $ 1,610 $ 5,597 $ 3,279 $ 1,994 $ 2,180 $ 14,660 99 CITY OF RIVERSIDE
COMBINING STATEMENT OF CASH FLOWS
NON-MAJOR ENTERPRISE FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Business-Type Activities - Enterprise Funds
Airport Refuse Transportation Public Parking
Civic
Entertainment
Total
Non-Major
Enterprise
Funds
Reconciliation of Operating Income to Net Cash Provided/(Used) by Operating Activities:
Operating income/(loss) $ (192) $ 1,478 $ (3,516) $ 956 $ (7,790) $ (9,064) Adjustments to reconcile operating income (loss) net cash provided (used) by operating activities:
Depreciation 717 837 448 855 2,525 5,382
Amortization 1 565 2 74 - 642
(Increase)/decrease in utility billed receivable - (1,196) - - - (1,196) (Increase)/decrease in utility unbilled receivable - (64) - - - (64) (Increase)/decrease in accounts receivable 3 59 2 199 (1,878) (1,615) (Increase)/decrease in property tax receivable 20 - - - - 20 (Increase)/decrease in intergovernmental receivable 50 - 19 (5) 828 892 (Increase)/decrease in inventory - - - - (38) (38)
(Increase)/decrease in prepaid items - 8 - - (6) 2
(Increase)/decrease in deposits - - - - (6) (6)
Increase/(decrease) in accounts payable (39) 722 (99) 225 (45) 764 Increase/(decrease) in accrued payroll 5 37 12 13 - 67
Increase/(decrease) in retainage payable (4) - - - 478 474 Increase/(decrease) in unearned revenue 17 - 3,102 - 1,117 4,236 Increase/(decrease) in deposits payable - - - - 123 123 Increase/(decrease) in compensated absences 4 (16) (18) (17) - (47) Increase/(decrease) in landfill capping liability - (599) - - - (599) Changes in net pension liability/(asset) and related deferred inflows/(outflows) of resources (155) (912) (442) (231) - (1,740)
Changes in OPEB liability and related deferred inflows/(outflows) of resources 7 60 35 13 - 115 Total adjustments 626 (499) 3,061 1,126 3,098 7,412
Net cash provided/(used) by operating activities $ 434 $ 979 $ (455) $ 2,082 $ (4,692) $ (1,652) 100
Internal Service Funds
Internal Service Funds are used to account for the financing of goods and services provided by one City department to other City departments on a cost- reimbursement basis.
Self-Insurance Trust - To account for the operations of the City's self-insured workers' compensation, unemployment, and liability programs.
Central Stores - To account for the operations of the City's centralized supplies inventory, including receiving and delivery s ervices provided to City departments.
Central Garage - To account for the maintenance and repair of all city-owned vehicles and motorized equipment, except for Police vehicles. 101
CITY OF RIVERSIDE
COMBINING STATEMENT OF NET POSITION
INTERNAL SERVICE FUNDS
JUNE 30, 2022
(amounts expressed in thousands)
Governmental Activities - Internal Service Funds
Self Insurance
Trust Central Stores Central Garage
Total Internal
Service Funds
Assets:
Current assets:
Cash and investments $ 45,191 $ - $ 12,011 $ 57,202
Receivables, net of allowance for uncollectible
Interest 92 - 25 117
Accounts 29 - 96 125
Intergovernmental 185 - 230 415
Inventory - 7,707 490 8,197
Prepaid items - - 2 2
Total current assets 45,497 7,707 12,854 66,058
Noncurrent assets:
Net pension asset 452 301 1,479 2,232
Capital assets, net of accumulated depreciation - 92 7,027 7,119 Right to use assets, net of amortization 17 - 6 23
Total noncurrent assets 469 393 8,512 9,374
Total assets 45,966 8,100 21,366 75,432
Deferred Outflows of Resources:
Pension related items 158 105 517 780
OPEB related items 51 32 128 211
Total deferred outflows of resources 209 137 645 991
Liabilities:
Current liabilities:
Accounts payable 292 779 460 1,531
Accrued payroll 12 15 50 77
Retainage payable - - 6 6
Due to other funds - 39 - 39
Total current liabilities 304 833 516 1,653
Noncurrent liabilities:
Due within one year:
Long-term obligations 38 40 210 288
Compensated absences 37 106 208 351
Claims and judgments 15,304 - - 15,304
Lease liability 4 - 1 5
Due in more than one year:
Long-term obligations 572 577 3,137 4,286
Compensated absences 12 32 62 106
Claims and judgments 63,486 - - 63,486
OPEB liability 188 191 828 1,207
Lease liability 12 - 4 16
Total noncurrent liabilities 79,653 946 4,450 85,049
Total liabilities 79,957 1,779 4,966 86,702
Deferred Inflows of Resources:
Pension related items 760 506 2,487 3,753
OPEB related items 36 28 87 151
Total deferred inflows of resources 796 534 2,574 3,904 Net Position:
Net investment in capital assets 3 92 7,028 7,123
Unrestricted/(deficit) (34,581) 5,832 7,443 (21,306)
Total net position $ (34,578) $ 5,924 $ 14,471 $ (14,183) 102
CITY OF RIVERSIDE
COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION
INTERNAL SERVICE FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Governmental Activities - Internal Service Funds
Self Insurance
Trust Central Stores Central Garage
Total Internal
Service Funds
Operating Revenues:
Charges for services $ 18,151 $ 1,285 $ 8,974 $ 28,410
Total operating revenues 18,151 1,285 8,974 28,410
Operating Expenses:
Personnel services 732 737 2,237 3,706
Contractual services 1,394 5 177 1,576
Maintenance and operation 4 30 2,956 2,990
General 5,205 237 1,034 6,476
Materials and supplies 1 14 128 143
Claims/Insurance 14,792 - 95 14,887
Depreciation - 11 730 741
Amortization 4 - 1 5
Total operating expenses 22,132 1,034 7,358 30,524
Operating income (loss) (3,981) 251 1,616 (2,114)
Nonoperating Revenues/(Expenses):
Interest revenue (1,031) - (345) (1,376)
Interest expense and fiscal charges (19) (20) (109) (148) Other 134 - 39 173
Gain/(loss) on disposal of capital assets - 2 103 105
Total nonoperating revenues/(expenses) (916) (18) (312) (1,246) Income/(loss) before contributions and operating
transfers (4,897) 233 1,304 (3,360)
Capital contributions - - 92 92
Transfers in 2,714 - - 2,714
Transfers out - (1) (3) (4)
Change in net position (2,183) 232 1,393 (558)
Beginning of year (32,395) 5,692 13,078 (13,625)
End of year $ (34,578) $ 5,924 $ 14,471 $ (14,183)
103
CITY OF RIVERSIDE
COMBINING STATEMENT OF CASH FLOWS
INTERNAL SERVICE FUNDS
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Governmental Activities - Internal Service Funds
Self Insurance
Trust Central Stores Central Garage
Total Internal
Service Funds
Cash Flows from Operating Activities:
Cash received from interfund services provided $ 18,124 $ 1,285 $ 8,893 $ 28,302 Cash paid to suppliers for goods and services (19,217) (591) (4,682) (24,490) Cash paid to employees for services (1,017) (808) (2,964) (4,789) Net cash provided/(used) by operating activities (2,110) (114) 1,247 (977) Cash Flows from Non-Capital Financing Activities:
Transfers in 2,714 - - 2,714
Transfers out - (1) (3) (4)
Payments from other funds - 39 - 39
Payments on pension obligation bonds (30) (32) (165) (227) Other receipts/(payments) from non-operating revenue 133 - 39 172 Net cash provided/(used) by non-capital financing
activities 2,817 6 (129) 2,694
Cash Flows from Capital and Related Financing Activities:
Purchase of capital assets - (3) (1,623) (1,626)
Proceeds from sales of capital assets - 2 103 105
Interest paid on long-term obligations (20) (20) (109) (149) Contributions - - 92 92
Lease payments (4) - (2) (6)
Net cash provided/(used) by capital and related
financing activities (24) (21) (1,539) (1,584)
Cash Flows from Investing Activities:
Interest from investments (1,083) - (348) (1,431)
Net cash provided/(used) by capital and related
financing activities (1,083) - (348) (1,431)
Net increase/(decrease) in cash and cash equivalents (400) (129) (769) (1,298) Cash and cash equivalents at beginning of year 45,591 129 12,780 58,500 Cash and cash equivalents at end of year $ 45,191 $ - $ 12,011 $ 57,202 Reconciliation of Operating Income to Net Cash
Provided/(Used) by Operating Activities:
Operating income/(loss) $ (3,981) $ 251 $ 1,616 $ (2,114) Adjustments to Reconcile Operating Income/(Loss) Net Cash Provided/(Used) by Operating Activities:
Depreciation - 11 730 741
Amortization 4 - 1 5
(Increase)/decrease in accounts receivable - - 11 11
(Increase)/decrease in intergovernmental receivable (30) - (92) (122) (Increase)/decrease in inventory - (671) (108) (779)
Increase/(decrease) in accounts payable (2) 366 (172) 192 Increase/(decrease) in accrued payroll 2 9 20 31
Increase/(decrease) in retainage payable - - (15) (15)
Increase/(decrease) in compensated absences (71) 33 (24) (62) Increase/(decrease) in claims and judgments 2,187 - - 2,187 Changes in net pension liability/(asset) and related deferred inflows/(outflows) of resources (232) (124) (749) (1,105) Changes in OPEB liability and related deferred inflows/(outflows) of resources 13 11 29 53
Total adjustments 1,871 (365) (369) 1,137
Net cash provided/(used) by operating activities $ (2,110) $ (114) $ 1,247 $ (977) 104
Combining General Fund and Capital Outlay Fund Schedules with Measure Z Fund Activity
105
CITY OF RIVERSIDE
BALANCE SHEET
COMBINING GENERAL FUND SCHEDULE
JUNE 30, 2022
(amounts expressed in thousands)
General Fund Measure Z Fund
Total General
Fund
Assets:
Cash and investments $ 127,536 $ 64,659 $ 192,195
Cash and investments with fiscal agent 19,423 11,292 30,715 Receivables, net of allowance for uncollectible
Interest 273 128 401
Property taxes 1,544 - 1,544
Sales taxes 15,476 14,919 30,395
Utility billed 3,350 - 3,350
Accounts 7,062 1 7,063
Intergovernmental 4,444 - 4,444
Lease receivable 7,501 - 7,501
Prepaid items 1,726 186 1,912
Due from other funds 870 - 870
Land and improvements held for resale 175 - 175
Total assets $ 189,380 $ 91,185 $ 280,565
Liabilities, Deferred Inflows of Resources, and Fund Balances :
Liabilities:
Accounts payable $ 8,114 $ 1,380 $ 9,494
Accrued payroll 21,075 358 21,433
Retainage payable - 2 2
Intergovernmental 153 - 153
Deposits 11,459 - 11,459
Total liabilities 40,801 1,740 42,541
Deferred Inflows of Resources:
Unavailable revenue 3,082 - 3,082
Lease related items 7,724 - 7,724
Total deferred inflows of resources 10,806 - 10,806
Fund Balances:
Nonspendable:
Inventories, prepaids, and deposits 1,726 186 1,912
Land and improvements held for resale 175 - 175
Restricted:
Debt service - 11,292 11,292
Unfunded accrued liability 19,423 - 19,423
Committed:
Economic contingency 61,000 5,000 66,000
Other purposes 16,801 - 16,801
Assigned:
General government 3,329 1,831 5,160
Public safety 773 11,546 12,319
Highways and streets 1,049 2,017 3,066
Culture and recreation 1,344 165 1,509
Continuing projects 3,333 16,320 19,653
Unassigned 28,820 41,088 69,908
Total fund balances 137,773 89,445 227,218
Total liabilities, deferred inflows of resources, and fund balances $ 189,380 $ 91,185 $ 280,565
106
CITY OF RIVERSIDE
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
COMBINING GENERAL FUND SCHEDULE
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
General Fund Measure Z Fund
Total General
Fund
Revenues:
Taxes $ 215,829 $ 83,157 $ 298,986
Licenses and permits 11,304 - 11,304
Intergovernmental 4,463 - 4,463
Charges for services 15,311 - 15,311
Fines and forfeitures 2,096 - 2,096
Special assessments 316 - 316
Rental and investment income (4,942) 551 (4,391)
Miscellaneous 1,231 1 1,232
Total revenues 245,608 83,709 329,317
Expenditures:
Current:
General government 6,274 1,923 8,197
Public safety 170,341 23,028 193,369
Highways and streets 16,952 983 17,935
Culture and recreation 29,896 986 30,882
Capital outlay 1,950 1,312 3,262
Debt service:
Principal 675 - 675
Interest and fiscal charges 96 - 96
Total expenditures 226,184 28,232 254,416
Excess/(deficiency) of revenues over/(under)
expenditures 19,424 55,477 74,901
Other Financing Sources/(Uses):
Transfers in 47,294 11,292 58,586
Transfers out (49,252) (18,430) (67,682)
Transfers in/(out) to General Fund * 18,266 (18,266) -
Proceeds from sale of capital assets 53 - 53
Proceeds from financing related to leases 1,713 - 1,713 Total other financing sources/(uses) 18,074 (25,404) (7,330) Net change in fund balance 37,498 30,073 67,571
Fund Balances:
Beginning of year 100,275 59,372 159,647
End of year $ 137,773 $ 89,445 $ 227,218
* Per accounting standards, transfers within the same fund are not reflected in the Statement of Revenues, Expenditures, and Changes in Fund Balances; however, they are reflected in this schedule for transparency purposes.
107
CITY OF RIVERSIDE
BALANCE SHEET
COMBINING CAPITAL OUTLAY FUND SCHEDULE
JUNE 30, 2022
(amounts expressed in thousands)
Capital Outlay
Fund
Measure Z
Capital Outlay
Fund
Total Capital
Outlay Fund
Assets:
Cash and investments $ 34,576 $ 17,779 $ 52,355
Receivables, net of allowance for uncollectible
Interest 72 39 111
Accounts 451 - 451
Intergovernmental 4,700 - 4,700
Prepaid items 19 - 19
Total assets $ 39,818 $ 17,818 $ 57,636
Liabilities, Deferred Inflows of Resources, and Fund
Balances:
Liabilities:
Accounts payable $ 1,314 $ 1,448 $ 2,762
Retainage payable 29 319 348
Unearned revenue 1,502 - 1,502
Total liabilities 2,845 1,767 4,612
Deferred Inflows of Resources:
Unavailable revenue 520 - 520
Total deferred inflows of resources 520 - 520
Fund Balances:
Restricted:
Transportation and public works 36,453 16,051 52,504
Total fund balances 36,453 16,051 52,504
Total liabilities, deferred inflows of resources, and fund balances $ 39,818 $ 17,818 $ 57,636
108
CITY OF RIVERSIDE
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
COMBINING CAPITAL OUTLAY FUND SCHEDULE
FOR THE YEAR ENDED JUNE 30, 2022
(amounts expressed in thousands)
Capital Outlay
Fund
Measure Z
Capital Outlay
Fund
Total Capital
Outlay Fund
Revenues:
Intergovernmental $ 13,830 $ - $ 13,830
Special assessments 538 - 538
Rental and investment income (873) (564) (1,437)
Miscellaneous 742 - 742
Total revenues 14,237 (564) 13,673
Expenditures:
Capital outlay 5,248 14,881 20,129
Debt service:
Interest and fiscal charges 4 - 4
Total expenditures 5,252 14,881 20,133
Excess/(deficiency) of revenues over/(under) expenditures 8,985 (15,445) (6,460) Other Financing Sources/(Uses):
Transfers in 826 10,825 11,651
Transfers out (3,045) - (3,045)
Total other financing sources/(uses) (2,219) 10,825 8,606 Net change in fund balances 6,766 (4,620) 2,146
Fund Balances:
Beginning of year 29,687 20,671 50,358
End of year $ 36,453 $ 16,051 $ 52,504
109
Statistical Section
(Unaudited)
This part of the City's annual comprehensive financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City's overall financial health.
Contents Page
Financial Trends 111
These schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time.
Revenue Capacity 116
These schedules contain trend information to help the reader assess the factors affecting the City's ability to generate its property and sales taxes.
Debt Capacity 126
These schedules present information to help the reader assess the affordability of the City's current levels of outstanding debt and the City's ability to issue additional debt in the future.
Demographic and Economic Information 132
These schedules offer demographic and economic indicators to help the reader understand the environment within which the City's financial activities take place and to help make comparisons over time and with other governments.
Operating Information 135
These schedules contain information about the City's operations and resources to help the reader understand how the City's financial information relates to the services the City provides and the activities it performs.
Source: Unless otherwise noted, the information in these schedules is derived from the annual comprehensive financial reports for the relevant year. 110
CITY OF RIVERSIDE
TABLE 1
NET POSITION BY COMPONENT
LAST TEN FISCAL YEAR
(accrual basis of accounting) (in thousands)
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Governmental Activities
Net investment in capital assets $ 1,083,485 $ 1,106,384 $ 1,126,220 $ 1,123,910 $ 1,102,409 $ 1,093,896 $ 1,102,837 $ 1,081,991 $ 1,170,232 $ 1,176,215 Restricted 80,712 96,587 105,847 106,488 104,853 112,183 126,551 153,806 164,809 203,038 Unrestricted 17,989 (2,049) (406,388) (389,278) (362,146) (364,500) (356,340) (369,222) (366,713) (284,713) Total governmental activities net position $ 1,182,186 $ 1,200,922 $ 825,679 $ 841,120 $ 845,116 $ 841,579 $ 873,048 $ 866,575 $ 968,328 $ 1,094,540 Business-Type Activities
Net investment in capital assets $ 609,691 $ 616,844 $ 626,166 $ 654,870 $ 702,844 $ 800,227 $ 867,206 $ 751,865 $ 756,116 $ 774,469 Restricted 69,068 68,507 75,660 85,526 93,570 80,717 67,057 75,170 78,885 85,666 Unrestricted 330,833 359,698 209,469 235,144 245,116 199,143 155,468 272,776 263,837 284,977 Total business-type activities net position $ 1,009,592 $ 1,045,049 $ 911,295 $ 975,540 $ 1,041,530 $ 1,080,087 $ 1,089,731 $ 1,099,811 $ 1,098,838 $ 1,145,112 Primary Government
Net investment in capital assets $ 1,693,176 $ 1,723,228 $ 1,752,386 $ 1,778,780 $ 1,805,253 $ 1,894,123 $ 1,970,043 $ 1,833,856 $ 1,926,348 $ 1,950,684 Restricted 149,780 165,094 181,507 192,014 198,423 192,900 193,608 228,976 243,694 288,704 Unrestricted 348,822 357,649 (196,919) (154,134) (117,030) (165,357) (200,872) (96,446) (102,876) 264 Total primary government net position $ 2,191,778 $ 2,245,971 $ 1,736,974 $ 1,816,660 $ 1,886,646 $ 1,921,666 $ 1,962,779 $ 1,966,386 $ 2,067,166 $ 2,239,652 111
CITY OF RIVERSIDE
TABLE 2
CHANGES IN NET POSITION
LAST TEN FISCAL YEARS
(accrual basis of accounting) (in thousands) Page 1 of 2 Fiscal Year
20131 2014 2015 2016 2017 2018 2019 2020 2021 2022
Expenses
Governmental Activities:
General government $ 54,808 $ 39,331 $ 26,587 $ 24,483 $ 44,510 $ 45,360 $ 51,139 $ 63,651 $ 97,927 $ 66,937 Public safety 147,652 149,555 154,123 161,284 160,665 216,772 201,942 222,061 219,136 169,742 Highways and streets 35,072 36,564 36,563 38,836 38,585 42,544 43,770 46,983 42,034 41,125 Cultural and recreation 40,077 42,252 45,594 47,762 49,406 38,362 31,200 37,400 37,693 38,885 Interest on long-term debt and fiscal charges 16,627 17,741 17,025 16,387 16,028 12,414 10,045 13,181 19,083 19,806 Total governmental activities 294,236 285,443 279,892 288,752 309,194 355,452 338,096 383,276 415,873 336,495 Business-Type Activities:
Electric 292,175 304,416 309,874 307,925 317,335 333,061 347,804 350,667 366,165 349,004 Water 58,768 60,030 62,792 57,769 62,189 68,281 70,912 73,742 71,738 69,303 Sewer 43,945 40,385 35,593 39,978 38,305 54,136 70,137 62,961 61,029 59,060 Airport 2,029 1,662 1,809 1,799 1,998 2,179 1,972 2,304 2,326 1,944 Refuse 20,581 20,831 20,007 21,652 21,953 22,082 24,205 26,549 28,428 28,449 Transportation 3,745 4,067 4,385 4,113 4,221 4,782 4,493 4,607 4,623 3,758 Public Parking 5,051 4,610 5,604 5,141 5,448 6,186 5,151 4,628 4,684 4,566 Civic Entertainment - - - - - 19,995 24,151 21,584 11,885 21,804 Total business-type activities 426,294 436,001 440,064 438,377 451,449 510,702 548,825 547,042 550,878 537,888 Total primary government expenses $ 720,530 $ 721,444 $ 719,956 $ 727,129 $ 760,643 $ 866,154 $ 886,921 $ 930,318 $ 966,751 $ 874,383 Program Revenues
Governmental Activities:
Charges for services:
General government $ 13,338 $ 13,775 $ 17,600 $ 24,944 $ 27,441 $ 24,605 $ 29,281 $ 25,698 $ 11,485 $ 13,721 Public safety 7,793 7,444 7,256 3,243 1,167 1,880 2,443 2,138 7,649 14,491 Highways and streets 15,825 17,487 13,868 5,709 5,930 5,554 6,036 5,174 11,278 6,090 Cultural and recreation 5,237 7,406 16,319 12,458 22,802 6,078 7,465 5,050 3,694 6,770 Operating grants and contributions 21,485 14,341 12,869 16,321 19,374 22,548 23,966 21,779 64,405 50,378 Capital grants and contributions 32,202 48,433 43,904 31,216 7,617 18,039 27,450 19,945 28,284 38,508 Total governmental activities 95,880 108,886 111,816 93,891 84,331 78,704 96,641 79,784 126,795 129,958 Business-Type Activities:
Charges for services:
Electric 347,933 344,037 347,621 354,530 366,066 364,516 363,570 368,969 376,101 397,947 Water 68,489 68,691 66,051 57,250 62,627 66,828 65,177 70,167 80,252 80,535 Sewer 43,772 46,162 50,336 52,664 59,735 65,081 64,282 64,114 66,323 71,557 Airport 1,396 1,100 1,260 1,549 1,578 1,562 1,618 1,743 1,709 1,728 Refuse 20,829 20,677 21,360 21,806 22,567 23,085 23,004 25,109 26,468 29,768 Transportation 344 413 385 377 359 441 444 309 65 168
Public Parking 4,777 4,382 4,609 4,918 5,009 6,258 4,604 4,301 2,968 4,888 Civic Entertainment - - - - - 16,393 16,977 12,233 1,381 11,883 Operating grants and contributions 2,718 2,524 3,869 2,322 3,751 3,374 3,093 3,473 3,976 5,866 Capital grants and contributions 11,734 11,486 8,027 18,868 24,151 26,957 10,607 13,979 12,273 20,527 Total business-type activities 501,992 499,472 503,518 514,284 545,843 574,495 553,376 564,397 571,516 624,867 Total primary government program revenues $ 597,872 $ 608,358 $ 615,334 $ 608,175 $ 630,174 $ 653,199 $ 650,017 $ 644,181 $ 698,311 $ 754,825 112
CITY OF RIVERSIDE
TABLE 2
CHANGES IN NET POSITION
LAST TEN FISCAL YEARS
(accrual basis of accounting) (in thousands) Page 2 of 2 Fiscal Year
20131 2014 2015 2016 2017 2018 2019 2020 2021 2022
Net Revenues/(Expenses)
Governmental Activities $ (198,356) $ (176,557) $ (168,076) $ (194,861) $ (224,863) $ (276,748) $ (241,455) $ (303,492) $ (289,078) $ (206,537) Business-Type Activities 75,698 63,471 63,454 75,907 94,394 63,793 4,551 17,355 20,638 86,979 Total primary government net
revenues/(expenses) $ (122,658) $ (113,086) $ (104,622) $ (118,954) $ (130,469) $ (212,955) $ (236,904) $ (286,137) $ (268,440) $ (119,558) General Revenues and Other Changes in Net
Position
Governmental Activities:
Taxes:
Sales taxes $ 50,222 $ 55,096 $ 59,437 $ 60,976 $ 75,883 $ 120,338 $ 130,645 $ 128,653 $ 150,321 $ 173,933 Property taxes 52,904 51,323 54,864 55,545 59,526 63,515 69,478 72,609 71,986 79,790 Utility users' taxes 28,206 28,092 28,076 27,828 27,958 27,498 28,009 29,044 30,577 32,464 Franchise taxes 4,959 5,046 5,543 5,730 4,814 4,972 5,256 5,443 5,527 5,955 Transient occupancy taxes 3,703 4,189 5,280 6,093 6,622 6,793 7,163 5,959 5,801 8,764 Intergovernmental, unrestricted 337 263 3,153 477 145 172 156 656 499 661 Investment Income 2,786 2,759 3,233 729 6,145 5,187 7,500 10,185 4,969 (7,613) Miscellaneous 9,208 5,425 12,395 11,708 2,050 4,278 - 9,146 5,988 3,880 Transfers 42,262 43,100 42,681 41,216 45,716 41,459 37,115 35,324 34,879 34,915 Total governmental activities 194,587 195,293 214,662 210,302 228,859 274,212 285,322 297,019 310,547 332,749 Business-Type Activities:
Investment income 4,744 8,005 5,319 6,888 2,650 3,939 19,488 19,838 681 (13,324) Miscellaneous 5,767 7,081 7,652 22,666 14,662 12,901 10,322 8,211 11,986 12,639 Extraordinary items (41,259) - - - - - - - - (5,748)
Transfers (42,262) (43,100) (42,681) (41,216) (45,716) (41,459) (37,115) (35,324) (34,278) (34,915) Total business-type activities (73,010) (28,014) (29,710) (11,662) (28,404) (24,619) (7,305) (7,275) (21,611) (41,348) Total primary government 121,577 167,279 184,952 198,640 200,455 249,593 278,017 289,744 288,936 291,401 Change in Net Position
Governmental Activities $ (3,769) $ 18,736 $ 46,586 $ 15,441 $ 3,996 $ (2,536) $ 43,867 $ (6,473) $ 21,469 $ 126,212 Business-Type Activities 2,688 35,457 33,744 64,245 65,990 39,174 (2,754) 10,080 (973) 45,631 Total primary government $ (1,081) $ 54,193 $ 80,330 $ 79,686 $ 69,986 $ 36,638 $ 41,113 $ 3,607 $ 20,496 $ 171,843 1 The decrease in total business-type activities net position is primarily due to the power plant closure. 113
CITY OF RIVERSIDE
TABLE 3
FUND BALANCES - GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(modified accrual basis of accounting) (in thousands)
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
General Fund
Nonspendable $ 26,421 $ 24,419 $ 23,642 $ 23,094 $ 26,168 $ 1,947 $ 949 $ 1,446 $ 1,870 $ 2,087 Restricted 2,196 2,204 2,985 3,067 2,651 2,991 3,411 10,699 10,697 30,715 Committed - - - - - 53,800 65,916 59,280 62,400 82,801
Assigned 10,711 14,505 13,965 9,922 14,968 23,242 26,984 21,260 24,890 41,707 Unassigned 37,763 37,732 39,059 29,495 39,283 7,644 23,907 41,184 59,790 69,908 Total general fund $ 77,091 $ 78,860 $ 79,651 $ 65,578 $ 83,070 $ 89,624 $ 121,167 $ 133,869 $ 159,647 $ 227,218 All Other Governmental Funds
Nonspendable $ 1,441 $ 1,460 $ 1,625 $ 1,619 $ 1,601 $ 4,855 $ 1,560 $ 1,510 $ 1,477 $ 1,495 Restricted for:
Housing and redevelopment 26,410 26,223 25,523 24,746 24,098 18,827 16,668 16,611 18,553 12,292 Debt service 25,884 26,177 26,203 26,221 6,455 11,509 6,825 11,210 11,292 11,679 Transportation and public works 16,487 54,876 36,347 36,876 34,178 43,499 91,379 84,413 78,884 87,073 Other purposes 2,003 321 2,326 3,628 4,145 3,451 5,505 5,984 6,275 7,351 Unassigned - - - - (24) - - (27) - (1,215)
Total all other governmental funds $ 72,225 $ 109,057 $ 92,024 $ 93,090 $ 70,453 $ 82,141 $ 121,937 $ 119,701 $ 116,481 $ 118,675 Notes:
Certain reclassifications have been made to prior year balances to conform with current year's presentation. 114
CITY OF RIVERSIDE
TABLE 4
CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(modified accrual basis of accounting) (in thousands)
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Revenues:
Taxes $ 139,994 $ 143,748 $ 153,200 $ 156,172 $ 174,803 $ 223,116 $ 240,416 $ 241,708 $ 267,714 $ 300,906 Licenses and permits 10,173 9,244 11,168 11,611 14,455 12,442 14,317 13,023 12,778 14,850 Intergovernmental 50,734 59,348 49,892 51,896 31,440 42,454 44,950 42,296 87,226 88,000 Charges for services 12,062 15,734 24,737 26,443 31,384 17,438 16,927 15,968 14,578 16,938 Fines and forfeitures 6,234 7,283 3,957 1,941 1,976 3,717 2,078 1,887 2,100 2,096 Special assessments 6,669 6,272 6,757 7,039 7,578 7,113 7,973 6,950 7,674 7,188 Rental and investment income 3,878 4,315 5,112 4,370 4,718 3,446 6,548 8,441 4,437 (6,533) Miscellaneous 14,933 6,957 6,939 12,578 7,252 8,716 5,370 7,845 5,962 3,703 Total revenues $ 244,677 $ 252,901 $ 261,762 $ 272,050 $ 273,606 $ 318,442 $ 338,579 $ 338,118 $ 402,469 $ 427,148 Expenditures:
General government $ 15,713 $ 13,558 $ 17,799 $ 19,900 $ 20,650 $ 21,135 $ 18,880 $ 107,779 $ 30,887 $ 24,329 Public safety 150,290 151,721 157,660 164,800 163,712 190,916 198,363 434,208 200,733 205,968 Highways and streets 16,294 16,944 16,594 17,416 17,504 19,207 20,927 22,254 16,897 18,805 Culture and recreation 45,356 34,275 37,527 39,583 40,643 29,382 30,528 28,825 28,391 33,065 Capital outlay 73,581 72,365 60,060 53,208 31,000 33,504 41,585 55,178 69,248 71,534 Debt service:
Principal 45,006 45,500 49,101 51,987 72,700 21,904 37,867 23,761 24,475 28,126 Interest and fiscal charges 15,116 16,787 17,048 16,451 16,115 12,746 10,493 10,773 20,372 20,134 Bond issuance cost 581 843 172 180 29 24 854 1,185 - -
Payment for advance refunding 3,521 - - - - - - - -
Total expenditures $ 365,458 $ 351,993 $ 355,961 $ 363,525 $ 362,353 $ 328,818 $ 359,497 $ 683,963 $ 391,003 $ 401,961 Excess/(deficiency) of revenue
over/(under) expenditures $ (120,781) $ (99,092) $ (94,199) $ (91,475) $ (88,747) $ (10,376) $ (20,918) $ (345,845) $ 11,466 $ 25,187 Other Financing Sources/(Uses):
Transfers in $ 56,572 $ 58,469 $ 61,510 $ 61,384 $ 94,521 $ 102,774 $ 94,771 $ 95,932 $ 112,907 $ 116,891 Transfers out (14,178) (15,369) (18,829) (20,168) (48,805) (66,021) (58,688) (60,608) (102,028) (85,380) Issuance of long-term debt 99,753 87,037 30,940 31,145 31,578 14,500 49,485 320,131 - 11,292 Proceeds from sale of capital assets 82 931 (114) 261 4,199 461 149 856 213 59 Proceeds from financing related to leases - - - - - - - - - 1,714 Capital lease financing 7,203 6,625 4,450 5,846 2,109 - - - - Bond premium/(discounts) (43,591) - - - - - 6,540 - - - Total other financing sources/(uses) 105,841 137,693 77,957 78,468 83,602 51,714 92,257 356,311 11,092 44,576 Net changes in fund balances $ (14,940) $ 38,601 $ (16,242) $ (13,007) $ (5,145) $ 41,338 $ 71,339 $ 10,466 $ 22,558 $ 69,763 Debt services as a percentage of non-capital
expenditures %21.039 %21.803 %22.360 %21.714 %26.625 %11.999 %15.143 %5.428 %13.383 %13.535 (1)
(1) Includes one-time payment of $318,944 to CalPERS to paydown the Unfunded Pension Liability for Miscellaneous and Safety personnel. 115
CITY OF RIVERSIDE
TABLE 5
BUSINESS-TYPE ACTIVITIES - ELECTRICITY REVENUES BY SOURCE
LAST TEN FISCAL YEARS
(accrual basis of accounting) (in thousands)
Fiscal
Year
Residential
Sales
Commercial
Sales 1
Industrial
Sales 1
Wholesale
Sales
Other
Sales
Transmission
Revenue
Other
Operating
Revenue
Total
Revenues
2013 $ 118,173 $ 66,632 $ 110,680 $ 638 $ 5,712 $ 32,688 $ 13,410 $ 347,933 2014 111,880 67,063 111,260 115 5,600 32,630 15,489 344,037 2015 114,112 68,572 112,283 60 5,654 30,587 16,353 347,621 2016 116,997 69,759 113,756 3 4,737 32,924 16,354 354,530 2017 117,662 71,456 115,432 9 4,782 35,497 21,779 366,617 2018 115,630 73,971 112,264 2 4,792 37,484 8,860 353,003 2019 116,303 72,511 111,445 344 4,824 35,730 22,413 363,570 2020 121,162 71,570 113,132 - 4,849 34,817 23,438 368,968 2021 133,460 71,510 112,572 27 4,864 32,316 21,351 376,100 2022 134,403 75,899 122,684 89 4,891 32,245 27,736 397,947 1 Changes in fiscal years 2018, 2019, 2020 and 2021 reflect reclassification of certain Industrial and Commercial accounts related to contract accounts. Prior to fiscal year 2018, accounts were reflected under Industrial Sales. 116
CITY OF RIVERSIDE
TABLE 6
GOVERNMENTAL ACTIVITIES - TAX REVENUE BY SOURCE
LAST TEN FISCAL YEARS
(accural basis of accounting) (in thousands)
Fiscal Year
Sales
Tax1
Property
Tax2
Utility
Users'
Tax
Franchise
Tax
Transient
Occupancy
Tax
Total
Taxes
2013 $ 50,222 $ 52,904 $ 28,206 $ 4,959 $ 3,703 $ 139,994 2014 55,096 51,323 28,092 5,046 4,189 143,746
2015 59,437 54,864 28,076 5,543 5,280 153,200
2016 60,976 55,545 27,828 5,730 6,093 156,172
2017 75,883 59,526 27,958 4,814 6,622 174,803
2018 120,338 63,515 27,498 4,972 6,793 223,116
2019 130,645 69,343 28,009 5,256 7,163 240,416
2020 128,653 72,609 29,044 5,443 5,959 241,708
2021 150,321 71,986 30,577 5,527 5,801 264,212
2022 173,933 79,790 32,464 5,955 8,764 300,906
1 Increase in sales tax in fiscal year 2017 is due to Measure Z which was passed by the voters November 2016 and became effective April 1, 2017.
Measure Z is a one percent transaction and use tax.
2 Decrease in property taxes in fiscal year 2013 relates to the dissolution of the Redevelopment Agency. Upon the dissolution of the Redevelopment Agency o n February 1 , 2012, property t axes received by t he Successor Agency a re reported in a private-purpose trust fund and therefore are excluded from the activities of the primary government. 117
CITY OF RIVERSIDE
TABLE 7
TAXABLE SALES BY CATEGORY
LAST TEN CALENDAR YEARS (in thousands)
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Apparel stores $ 175,320 $ 178,349 $ 188,670 $ 203,001 $ 214,852 $ 210,158 $ 212,036 $ 210,439 $ 147,176 $ 249,034 General merchandise 450,988 463,355 475,147 477,903 478,538 465,490 470,386 465,234 426,500 617,257 Food stores 181,719 193,368 209,022 217,902 168,854 169,922 184,278 185,859 202,647 208,060 Eating and drinking places 422,153 447,841 483,901 533,317 582,262 609,705 639,995 677,763 587,403 788,765 Building materials 376,011 454,468 514,993 567,790 636,415 666,907 738,178 761,881 813,584 1,010,364 Auto dealers and supplies 1,118,907 1,280,633 1,461,217 1,548,385 1,608,231 1,588,854 1,621,311 1,672,475 1,728,498 2,084,828 Service stations 430,322 418,110 413,128 370,257 338,762 360,830 432,991 434,162 327,119 527,973 Other retail stores 535,945 550,157 595,305 633,089 692,375 677,850 666,659 636,043 609,428 764,854 All other outlets 1,008,206 1,154,492 1,312,607 1,461,982 1,474,160 1,481,019 1,700,733 1,701,236 1,995,760 2,099,827 Total $ 4,699,571 $ 5,140,773 $ 5,653,990 $ 6,013,626 $ 6,194,449 $ 6,230,735 $ 6,666,567 $ 6,745,092 $ 6,838,115 $ 8,350,962 Notes:
Due to confidentiality issues, the names of the ten largest revenue payers are not available. The categories presented are intended to provide alternative information regarding the sources of the City's revenue.
Source: State of California Board of Equalization, California Department of Taxes and Fees Administration, State Controller's Office, and HdL Companies. 118
CITY OF RIVERSIDE
TABLE 8
ASSESSED VALUE AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY LAST TEN FISCAL YEARS (in thousands)
Fiscal
Year
Ended
June 30 Secured Unsecured
Less:
Exemptions
Taxable
Assessed
Value
Total
Direct
Rate1
2013 $ 22,313,665 $ 1,244,448 $ (7,142,401) $ 16,415,712 0.348 2014 23,045,134 1,201,634 (7,394,982) 16,851,786 0.125
2015 24,482,621 1,329,391 (7,945,000) 17,867,012 0.124
2016 25,710,122 1,225,375 (8,432,984) 18,502,513 0.124
2017 26,927,989 1,311,356 (9,029,817) 19,209,528 0.124
2018 28,373,517 1,354,934 (9,791,810) 19,936,641 0.124
2019 30,196,815 1,420,597 (10,818,883) 20,798,529 0.124 20202 31,856,912 1,466,408 (10,946,897) 22,376,423 0.124 2021 33,717,485 1,482,535 (11,915,468) 23,284,552 0.123 2022 35,353,418 1,736,131 (12,881,213) 24,208,336 0.123 Notes:
In 1978, the voters of the State of California passed Proposition 13 which limited property taxes to a total maximum rate of 1% based upon the assessed value of the property being taxed. Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only re-assessed at the time that it is sold to a new owner. At that point, the new assessed value is reassessed at the purchase price of the property sold. The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property and is subject to the limitations described above. Assessed valuations are based on 100 percent of estimated actual value. 1 Total Direct Rate is the weighted average of all individual direct rates. Beginning in 2013/14, the Direct Rate no longer includes revenue generated from the former redevelopment tax rate areas.
2 Total Taxable Assessed Value for FY2020 was recorded as an estimate and has been restated to the actual amount per information from the Riverside County Auditor-Controller.
Source: Riverside County Auditor-Controller
119
CITY OF RIVERSIDE
TABLE 9
DIRECT AND OVERLAPPING PROPERTY TAX RATES
(RATE PER $100 OF ASSESSED VALUATION)
LAST TEN FISCAL YEARS
2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 Basic Levy1 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Unified School Districts Debt Service 2 0.325 0.390 0.377 0.487 0.495 0.517 0.521 0.535 0.529 0.535 City of Riverside Debt Service 0.006 0.007 0.006 0.006 0.006 0.006 0.006 0.005 0.005 0.005 Metropolitan Water District Original Area 0.004 0.004 0.004 0.004 0.004 0.004 0.004 0.004 0.004 0.004 Riverside City Community College Debt Service 0.017 0.018 0.018 0.017 0.016 0.016 0.015 0.015 0.015 0.015 Total direct & overlapping3 tax rates 1.352 1.419 1.405 1.514 1.521 1.543 1.546 1.559 1.553 1.559 City's share of 1% levy per prop 134 0.113 0.113 0.113 0.113 0.113 0.113 0.113 0.113 0.113 0.113 General obligation debt rate 0.006 0.007 0.006 0.006 0.006 0.006 0.006 0.005 0.005 0.005 Total direct rate5 0.348 0.125 0.124 0.124 0.124 0.124 0.124 0.124 0.123 0.123 Notes:
Amounts presented in this table have been restated for prior years to reflect the most current information available. 1 In 1978, California voters passed Proposition 13 which set the property tax rate at a 1.00% fixed amount. This 1.00% is shared by all taxing agencies for which the subject property resides within. In addition to the 1.00% fixed amount, property owners are charged taxes as a percentage of assessed property values for the payment of any voter approved bonds. 2 Includes: Alvord Unified School District, Corona Norco Unified School District, Jurupa Unified School District, Moreno Valley Unified School District, and Riverside Unified School District. 3 Overlapping rates are those of local and county governments that apply to property owners within the City. Not all overlapping rates apply to all property owners. 4 City's share of 1% levy is based on the City's share of the general fund tax rate area with the largest net taxable value within the City. The ERAF portion of the City's levy has been subtracted where known.
5 Total Direct Rate is the weighted average of all individual direct rates applied by the City/Agency preparing the statistical information and excludes revenues derived from aircraft. Beginning in 2013/14, the Total Direct Rate no longer includes revenue generated from the former redevelopment tax rate areas. Challenges to recognize enforceable obligations assumed to have been resolved during 2012/13. For the purposes of this report, residual revenue is assumed to be distributed to the City/Agency in the same proportions as general fund revenue.
Source: Riverside County Assessor 2012/13 - 2021/22 Tax Rate Table. 120
CITY OF RIVERSIDE
TABLE 10
PRINCIPAL PROPERTY TAXPAYERS
CURRENT YEAR AND NINE YEARS AGO (in thousands)
2022 2013
Property Owner
Taxable
Assessed
Valuation Rank
Percentage of
Total Taxable
Assessed
Value
Taxable
Assessed
Valuation Rank
Percentage of
Total Taxable
Assessed
Value
Tyler Mall LP $ 230,416 1 %0.65 $ 190,480 1 %0.85
Nordstrom Inc 196,794 2 %0.56 -
CPT Riverside Plaza LLC 167,317 3 %0.47 -
Rohr Inc 155,703 4 %0.44 112,325 3 %0.50
La Sierra University 142,538 5 %0.40 104,729 4 %0.47
TA Lance Drive LLC 133,054 6 %0.38 -
490 Columbia 128,033 7 %0.36 -
Corona Pointe Resort LLC 127,164 8 %0.36 -
Riverside Healthcare System 111,349 9 %0.32 117,031 2 %0.52 Smiths Food and Drug Centers Inc 106,267 10 %0.30 -
Cole ID Riverside California - 91,500 5 %0.41
State Street Bank and Trust Co of CA - 89,839 6 %0.40
JSP Corona Pointe LLC - 76,159 7 %0.34
Vestar Riverside Plaza LLC - 69,554 8 %0.31
BRE Properties Inc - 69,277 9 %0.31
Canyon Springs Marketplace Corporation - 69,000 10 %0.31 Totals $ 1,498,635 %4.25 $ 989,894 %4.41
Notes:
The amounts shown above include assessed value data for both the City and the Successor Agency.
Source: Riverside County Assessor 2021/2022 and 2012/13 Combined Tax Rolls and the SBE Non Unitary Tax Roll. 121
CITY OF RIVERSIDE
TABLE 11
PROPERTY TAXES LEVIES AND COLLECTIONS
LAST TEN FISCAL YEARS (in thousands)
Fiscal Year Ended
Taxes
Levied for
Collected Within the
Fiscal Year of the Levy
Collections
in
Subsequent Total Collections to Date
June 30 Fiscal Year Amount Percentage of Levy Years Amount Percentage of Levy 2013 $ 43,333 $ 42,447 97.96% $ 886 $ 43,333 100.00%
2014 45,138 44,684 98.99% 454 45,138 100.00%
2015 48,846 48,427 99.14% 419 48,846 100.00%
2016 50,023 49,585 99.12% - 50,023 100.00%
2017 53,655 53,252 99.25% - 53,655 100.00%
2018 57,567 57,173 99.32% - 57,567 100.00%
2019 63,003 62,557 99.29% - 63,003 100.00%
2020 66,295 65,729 99.15% - 66,295 100.00%
2021 68,363 67,968 99.42% - 68,363 100.00%
2022 71,892 71,573 99.56% - 71,573 99.56%
Notes:
The table reflects amounts related to the City. In addition, it includes amounts related to the Redevelopment Agency through dissolution (01/31/12). The amounts collected by the Redevelopment Agency include monies that were passed-though to other agencies. Current tax levies are the original charge as provided by the County of Riverside. Current tax collections do not include supplemental taxes, aircraft taxes or other property taxes.
The City adopted the Teeter plan available with the County of Riverside effective Fiscal year 2014. Under the Teeter plan, the County of Riverside has responsibility for the collection of delinquent taxes and the City receives 100% of the levy.
Source: Riverside County Auditor-Controller and City Finance Department 122
CITY OF RIVERSIDE
TABLE 12
ELECTRICITY SOLD BY TYPE OF CUSTOMER
LAST TEN FISCAL YEARS (in millions of kilowatt-hours)
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Type of Customer:
Residential 726 700 711 726 730 727 722 722 783 759
Commercial1 419 421 428 438 448 476 460 442 430 443
Industrial1 1,003 997 995 982 996 970 947 931 890 923
Wholesale sales2 14 4 2 - 1 - - 1 - 2
Other 31 30 31 23 23 22 21 18 18 19
Total 2,193 2,152 2,167 2,169 2,198 2,195 2,150 2,114 2,121 2,146 Total direct rate
Monthly base rate * 18.06 18.06 18.06 18.06 18.06 18.06 19.41 20.63 21.84 23.20 * Includes a Reliability Charge
1 Changes in fiscal years 2018, 2019, 2020 and 2021 reflect reclassification of certain Industrial and Commercial accounts related to contract accounts. Prior to fiscal year 2018, accounts were reflected in the Industrial customer class.
2 For fiscal years 2016, 2018, 2019, and 2021 wholesale MWH was less than 1 MWH.
Source: Riverside Public Utilities, Finance Services
123
CITY OF RIVERSIDE
TABLE 13
ELECTRICITY RATES
LAST TEN FISCAL YEARS (average rate in dollars per kilowatt-hour) Fiscal
Year Ended
June 30 Residential Commercial1 Industrial1 Other
2013 0.16274 0.15913 0.11030 0.18375
2014 0.15995 0.15936 0.11156 0.18513
2015 0.16050 0.16022 0.11282 0.18291
2016 0.16119 * 0.15915 * 0.11577 * 0.20908 *
2017 0.16116 * 0.15958 * 0.11586 * 0.21287 *
2018 0.15910 * 0.15547 * 0.11570 * 0.21288 *
2019 0.16111 * 0.15768 * 0.11761 * 0.23448 *
2020 0.16774 * 0.16202 * 0.12149 * 0.26480 *
2021 0.17032 * 0.16636 * 0.12643 * 0.26659 *
2022 0.17707 * 0.17126 * 0.13295 * 0.26454 *
1 Changes in fiscal years 2018, 2019, 2020 and 2021 reflect reclassification of certain Industrial and Commercial accounts related to contract accounts. Prior to fiscal year 2018, accounts were reflected in the industrial customer class. * Rate calculations were taken from the Sales Stats not the financial statements.
Does not include Public Benefits charge.
Source: Riverside Public Utilities, Finance Services
124
CITY OF RIVERSIDE
TABLE 14
TOP 10 ELECTRICITY CUSTOMERS
CURRENT YEAR AND NINE YEARS AGO
2022 2013
Electricity Customer
Electricity
Charges Rank
Percent of
Total Electric
Revenues
Electricity
Charges Rank
Percent of
Total Electric
Revenues
Local University $ 12,258,825 1 %3.63 $ 10,828,940 1 %3.60 Local Government 8,259,542 2 %2.44 7,920,390 2 %2.63
Local Government 7,243,247 3 %2.14 - %0.00
Local School District 4,813,893 4 %1.42 4,199,138 4 %1.39 Corporation 4,190,792 5 %1.24 - %0.00
Corporation 3,844,085 6 %1.14 3,337,147 6 %1.11
Corporation 3,365,138 7 %1.00 - %0.00
Hospital 3,201,349 8 %0.95 2,457,850 7 %0.82
Corporation 3,103,067 9 %0.92 - %0.00
Local University 3,016,527 10 %0.89 - %0.00
Local Government - 0.00 7,447,872 3 2.47
Corporation - %0.00 3,386,525 5 %1.12
Corporation - %0.00 2,428,008 8 %0.81
Local School District - 0.00 2,091,371 9 0.69
Corporation - %0.00 2,087,427 10 %0.69
Total $ 53,296,464 %15.77 $ 46,184,669 %15.33
Retail sales per financial statements * $ 337,876,146 $ 301,196,912 Source: Riverside Public Utilities, Finance Services
* Financial Report - Riverside Public Utilities
125
CITY OF RIVERSIDE
TABLE 15
RATIOS OF OUTSTANDING DEBT BY TYPE
LAST TEN FISCAL YEARS (in thousands)
Governmental Activities
Fiscal Year
General
Obligation
Bonds
Lease
Revenue
Bonds
Pension
Obligation
Bonds2
Certificates
of
Participation
Financed
Purchase
Notes/Loans
Payable
2013 $ 15,314 $ 43,762 $ 122,005 $ 158,697 $ 8,424 $ 28,652 2014 14,460 42,344 115,775 191,446 13,168 47,611
2015 13,546 40,891 108,725 187,212 14,966 45,574
2016 12,567 39,398 101,000 181,429 12,006 43,482
2017 11,513 37,854 92,592 156,516 17,193 41,325
2018 10,388 36,246 60,883 150,800 25,647 1,746
2019 9,179 80,416 50,486 99,178 21,422 1,329
2020 7,874 75,964 364,633 94,802 18,207 899
2021 6,478 72,471 352,824 90,215 14,922 457
2022 4,987 68,855 338,264 85,477 22,294 -
Business-Type Activities
Fiscal Year
Revenue
Bonds
Notes/Loans
Payable
Financed
Purchase
Pension
Obligation
Bonds2
Certificates
of
Participation3
Lease
Revenue
Bonds4
Total
Primary
Government
Percentage
of Personal
Income1
Debt
Per
Capita1
2013 $ 1,031,839 $ 70,798 $ 2,558 $ - $ - $ - $ 1,482,049 21.41% 4.75 2014 1,094,290 36,030 2,266 - - - 1,557,390 22.54% 4.96 2015 1,239,634 37,225 1,720 - - - 1,689,493 24.64% 5.38 2016 1,208,851 37,793 4,694 - - - 1,641,220 23.60% 5.05 2017 1,180,345 35,255 6,209 - - - 1,578,802 22.11% 4.83 2018 1,139,864 78,583 6,821 18,324 - - 1,529,302 20.81% 4.69 2019 1,241,743 73,673 5,192 14,775 29,692 7,867 1,634,952 21.30% 4.98 2020 1,212,914 69,519 3,633 119,625 28,483 7,473 2,004,026 24.73% 6.11 2021 1,176,605 64,678 2,354 116,227 27,213 7,059 1,931,503 22.73% 5.96 2022 1,139,100 59,948 2,176 110,718 25,912 6,625 1,864,356 20.97% 5.87 1 These ratios are calculated using personal income and population data for the prior calendar year. 2 In 2018, the 2005 and 2017 Taxable Pension Obligation Bonds were distributed between Governmental Activities, Business-Type Activities, and the Successor Agency. 3 In 2019, the 2008 Certificates of Participation were distributed between Governmental Activities and Business-Type Activities. 4 In 2019, the 2012 Lease Revenue Refunding Bonds were distributed between Governmental Activities, Business-Type Activities, and the Successor Agency.
Source: City of Riverside Notes to Financial Statements and Statistical Table 20. 126
CITY OF RIVERSIDE
TABLE 16
RATIOS OF GENERAL BONDED DEBT OUTSTANDING
LAST TEN FISCAL YEARS (in thousands, except per capita amount) Fiscal Year
General
Obligation
Bonds
Pension
Bonds
Certificates
of
Participation
Total Obligated
Debt
Outstanding
Less: Amounts
Available in Debt
Service Fund
Net Obligated
Debt Outstanding
Percent of
Assessed
Value1
Per
Capita2
2013 $ 15,314 $ 122,005 $ 158,697 $ 296,016 $ (27,676) $ 268,340 %1.63 860 2014 14,460 115,775 191,446 321,681 (27,996) 293,685 %1.74 935 2015 13,546 108,725 187,212 309,483 (9,295) 300,188 %1.68 955 2016 12,567 101,000 181,429 294,996 (27,997) 266,999 %1.44 822 2017 11,513 92,592 156,516 260,621 (8,339) 252,282 %1.31 772 2018 10,388 60,883 150,800 222,071 (13,546) 208,525 %1.05 640 2019 9,179 50,486 99,178 158,843 (9,051) 149,792 %0.72 457 2020 7,874 364,633 94,802 467,309 (11,210) 456,099 %2.04 1,390 2021 6,478 352,824 90,215 449,517 (11,292) 438,225 %1.88 1,351 2022 4,987 338,264 85,477 428,728 (11,679) 417,049 %1.72 1,312 Notes:
General bonded debt is debt payable with governmental fund and enterprise fund resources. 1 Assessed value has been used because the actual value of taxable property is not readily available in the State of California. 2 These ratios are calculated using population data for the prior calendar year.
Source: City of Riverside Notes to Financial Statements, Statistical Table 8, Statistical Table 15, and Reserve Cash Reconciliation maintained by City Finance Department. 127
CITY OF RIVERSIDE
TABLE 17
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
JUNE 30, 2022 Page 1 of 2
2021-22 Assessed Valuation: $ 35,176,762,701
Less Dissolved Redevelopment Agency Incremental Valuation: 10,968,426,072 Adjusted Assessed Valuation: $ 24,208,336,629
Total Debt % Applicable
City's Share
of Debt1
Overlapping debt repaid with property taxes2
Metropolitan Water District $ 20,175,000 %1.045 $ 210,829 Riverside County Flood Control, Zone 4 7,880,000 1.833 144,440 Riverside City Community College District 300,457,165 27.860 83,707,366 Alvord Unified School District 197,211,602 72.108 142,205,342 Riverside Unified School District 321,490,000 84.218 270,752,448 Corona-Norco Unified School District 498,729,283 0.001 4,987 Jurupa Unified School District 151,897,972 0.002 3,038
Moreno Valley Unified School District 215,367,791 10.231 22,034,279 Alvord Unified School District Community Facilities District No.2006-1 6,235,000 80.759 5,035,324 Riverside Unified School District Community Facilities Districts 63,130,000 88.076-100 63,025,665 City of Riverside Community Facilities Districts 25,280,000 100.000 25,280,000 City of Riverside 1915 Act Bonds 16,315,000 100.000 16,315,000 Total overlapping debt repaid with property taxes $ 628,718,718 (Continued)
128
CITY OF RIVERSIDE
TABLE 17
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
AS OF JUNE 30 2022 Page 2 of 2
Other overlapping debt2
Riverside County General Fund Obligations $ 720,218,351 %10.712 $ 77,149,790 Riverside County Pension Obligations 820,060,000 10.712 87,844,827 Corona-Norco Unified School District General Fund Obligations 21,677,172 0.001 217 Jurupa Unified School District Certificates of Participation 50,480,800 0.002 1,010 Moreno Valley Unified School District Certificates of Participation 5,985,000 10.231 612,325 Riverside Unified School District General Fund Obligations 12,284,000 84.218 10,345,339 Western Municipal Water District General Fund Obligations 5,461,361 32.509 1,775,434 Total other overlapping debt 177,728,942
Overlapping tax increment debt 179,597,480
Total overlapping debt 986,045,140
City direct debt 519,877,000 (3)
Combined total direct and overlapping debt $ 1,505,922,140 (1) Debt balances are as of June 30, 2022.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue, non-bonded capital lease obligations. (3) Excludes debt related to Business-Type Activities.
Ratios to 2021-22 Assessed Valuation:
Total debt repaid with property taxes…………………….……..... %1.79 City direct debt $519,877,000 .......……...…………..………...…. %1.48 Combined total direct and overlapping debt……………............. %4.28 Ratios to dissolved redevelopment incremental valuation $(10,968,426,072):
Total overlapping tax increment debt…………………………….. %1.64 Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the City. This process recognizes that, when considering the City's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt of each overlapping government.
Source: California Municipal Statistics, Inc., Riverside County Auditor-Controller, City Finance Department, and Statistical Table 8. 129
CITY OF RIVERSIDE
TABLE 18
LEGAL DEBT MARGIN INFORMATION
LAST TEN FISCAL YEARS (in thousands)
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Assessed valuation $ 16,415,712 $ 16,851,786 $ 17,867,012 $ 18,502,513 $ 19,209,528 $ 19,936,641 $ 20,798,529 $ 22,376,423 $ 23,284,552 $ 24,208,336 Conversion percentage %25 %25 %25 %25 %25 %25 %25 %25 %25 %25 Adjusted assessed valuation 4,103,928 4,212,947 4,466,753 4,625,628 4,802,382 4,984,160 5,199,632 5,594,106 5,821,138 6,052,084 Debt limit percentage %15 %15 %15 %15 %15 %15 %15 %15 %15 %15 Debt limit 615,589 631,942 670,013 693,844 720,357 747,624 779,945 839,116 873,171 907,813 Total net debt applicable to limit 15,314 14,460 13,546 12,567 11,513 10,388 9,179 7,874 6,478 4,987 Legal debt margin $ 600,275 $ 617,482 $ 656,467 $ 681,277 $ 708,844 $ 737,236 $ 770,766 $ 831,242 $ 866,693 $ 902,826 Total net debt applicable to the limit
as a percentage of debt limit %2.5 %2.3 %2.0 %1.8 %1.6 %1.4 %1.2 %0.9 %0.7 %0.5 The Government Code of the State of California provides for a legal debt limit of 15% of gross assessed valuation. However, this provision was enacted when assessed valuation was based upon 25% of market value. Effective with the 1981-82 fiscal year, each parcel is now assessed at 100% of market value (as of the most recent change in ownership for that parcel). The computations shown above reflect a conversion of assessed valuation data for each fiscal year from the current full valuation perspective to the 25% level that was in effect at the time that the legal debt margin was enacted by the State of California for local governments located within the State.
Source: City of Riverside, Statistical Table 8, Statistical Table 15, and Notes to Financial Statements. 130
CITY OF RIVERSIDE
TABLE 19
PLEDGED-REVENUE COVERAGE
BUSINESS-TYPE ACTIVITY DEBT
LAST TEN FISCAL YEARS (in thousands)
Electric Revenue Bonds Water Revenue Bonds
Fiscal Pledged
Less:
Operating
Net
Available Debt Service Pledged
Less:
Operating
Net
Available Debt Service
Year Revenue1 Expenses1 Revenue Principle Interest Coverage Revenue1 Expenses1 Revenue Principal Interest Coverage 2013 $ 348,187 $ 226,997 $ 121,190 $ 18,486 $ 25,941 2.73 $ 72,700 $ 35,940 $ 36,760 $ 5,395 $ 8,700 2.61 2014 347,541 241,136 106,405 21,632 27,575 2.16 71,317 37,698 33,619 4,574 8,536 2.56 2015 348,244 250,578 * 97,666 15,485 26,532 2.32 66,010 36,725 * 29,285 5,258 8,342 2.15 2016 371,029 249,607 * 121,422 16,460 25,780 2.87 60,047 35,608 * 24,439 5,533 8,063 1.80 2017 368,956 251,998 * 116,958 14,032 25,553 2.95 65,689 37,956 * 27,733 5,486 8,124 2.04 2018 368,116 257,785 * 110,331 15,675 25,045 2.71 71,054 40,737 * 30,317 6,098 8,049 2.14 2019 374,510 279,394 * 95,116 16,449 26,017 2.24 69,965 44,547 * 25,418 6,362 8,780 1.68 2020 378,391 277,064 * 101,327 11,641 26,992 2.62 74,343 45,825 * 28,518 6,139 9,671 1.80 2021 373,663 284,293 * 89,370 17,364 27,559 1.99 83,510 45,896 * 37,614 7,007 9,685 2.25 2022 391,860 298,221 * 93,639 19,339 26,689 2.03 85,163 47,177 * 37,986 7,715 9,353 2.23 Sewer Revenue Bonds
Fiscal Pledged
Less:
Operating
Net
Available Debt Service
Year Revenue1 Expenses1 Revenue Principal Interest Coverage 2013 52,944 29,999 22,945 7,465 10,891 1.25
2014 52,098 28,930 23,168 7,753 10,781 1.25
2015 51,288 27,598 23,690 8,056 10,958 1.25
2016 68,412 31,864 36,548 8,405 20,786 1.25
2017 78,337 29,921 48,416 9,010 19,621 1.69
2018 68,735 31,513 37,222 9,184 19,136 1.31
2019 71,787 34,084 37,703 14,766 14,455 1.29
2020 70,365 33,704 36,661 8,634 18,434 1.35
2021 66,421 31,431 34,990 9,599 17,032 1.31
2022 69,422 29,640 39,782 9,966 16,575 1.50
Notes:
Details regarding the City's outstanding debt can be found in the notes to the financial statements The City of Riverside does not have any pledged revenue related to Govermental Activities. 1 Amounts have been calculated in accordance with the provisions set forth in the debt covenants. Total operating expenses exclusive of depreciation. Pledged revenue includes applicable cash set aside in a rate stabilization account in accordance with applicable bond covenants. * Excludes non-cash pension expense.
131
CITY OF RIVERSIDE
TABLE 20
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN CALENDAR YEARS
Calendar
Year Population1
Personal
Income2
(in thousands)
Per
Capita
Personal
Income2
Unemployment
Rate3
2012 311,955 6,923,217 22,193 9.7
2013 314,034 6,909,376 22,002 8.4
2014 314,221 6,857,559 21,824 7.9
2015 324,696 6,953,323 21,415 6.4
2016 326,792 7,139,080 21,846 5.8
2017 325,860 7,349,024 22,553 5.1
2018 328,101 7,674,374 23,390 3.8
2019 328,155 8,102,150 24,690 3.6
2020 324,302 8,496,064 26,198 9.0
2021 317,847 8,891,501 27,974 6.7
Sources:
1 California State Department of Finance.
2 Demographic Estimates are based on the last available Census. Projections are developed by incorporating all of the prior census data released to date. Demographic Data is totaled from Census Block Groups that overlap the City's boundaries. Demographic Estimates for 2010 and later are per the U.S. Cenus Bureau most recent American Community Survey. 3 State of California Employment Development Department. 132
CITY OF RIVERSIDE
TABLE 21
PRINCIPAL EMPLOYERS
CURRENT YEAR AND NINE YEARS AGO
2022 2013
Employer Employees Rank
Percentage
of Total City
Employment Employees Rank
Percentage
of Total City
Employment
County of Riverside 24,290 1 20.1% 11,187 1 7.6%
University of California, Riverside 8,593 2 7.1% 5,497 3 3.7% March Air Force Reserve 9,600 3 8.0%
Kaiser Permanente 5,846 4 4.8% 4,500 4 3.1%
Riverside Unified School District 5,003 5 4.1% 5,580 2 3.8% City of Riverside 2,336 6 1.9% 2,687 5 1.8%
Riverside Community Hospital 2,200 7 1.8% 1,880 7 1.3%
Riverside Community College District 2,100 8 1.7% 2,087 6 1.4% Alvord Unified School District 1,898 9 1.6% 1,445 9 1.0% California Baptist University 1,442 10 1.2%
Riverside County Office of Eduation 1,765 8 1.2%
Parkview Community Hospital 1,350 10 0.9%
Total 63,308 52.3% 37,978 25.8%
Source: City of Riverside, Economic Development Department 133
CITY OF RIVERSIDE
TABLE 22
FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION
LAST TEN FISCAL YEARS
2013 20141 2015 2016 2017 2018 2019 2020 2021 2022
Function
General government 413.90 356.25 361.25 394.24 417.55 430.05 453.80 458.30 460.30 462.05 Public safety (sworn and non-sworn personnel)
Police 596.75 551.75 553.75 554.75 512.00 543.00 557.00 571.00 585.00 604.00 Fire 255.46 255.00 255.00 251.00 239.00 242.00 245.00 248.00 251.00 250.00 Highways and streets 362.11 333.48 308.00 308.00 272.00 273.00 271.00 271.00 270.00 271.00 Sanitation 57.00 59.00 57.00 59.00 59.00 59.00 59.00 59.00 62.00 62.00 Culture and recreation 351.48 269.98 274.45 286.75 276.23 276.98 276.07 284.07 283.60 287.86 Airport 9.50 6.00 6.00 6.00 7.00 7.00 7.00 7.00 7.00 7.00 Water 181.15 182.15 181.15 181.15 174.15 158.65 158.65 158.65 164.50 164.50 Electric 459.50 462.50 464.50 466.50 471.75 489.25 475.25 475.25 466.25 468.50 Total 2,686.85 2,476.11 2,461.10 2,507.39 2,428.68 2,478.93 2,502.77 2,532.27 2,549.65 2,576.91 1 In fiscal year 2013/14, the City Council deleted a number of long-term unfunded positions.
Source: City of Riverside, Finance Department, FY 2021/22 Budget Master Personnel Detail 134
CITY OF RIVERSIDE
TABLE 23
OPERATING INDICATORS BY FUNCTION
LAST TEN FISCAL YEARS
Function/Program 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Police:
Arrests 8,362 9,321 10,310 9,242 8,358 8,423 8,295 7,738 8,089 7,667 Fire:
Number of calls answered 29,988 30,668 32,943 35,905 36,150 38,501 37,739 37,999 31,918 38,801 Inspections 10,151 12,476 8,770 6,636 6,482 6,519 5,584 7,987 7,175 9,244 Public Works:
Street resurfacing (miles) 16.50 35.38 38.75 39.01 27.09 17.37 16.50 18.80 7.30 17.35 Parks and Recreation:
Number of recreation classes 41,364 45,707 43,007 53,907 53,308 54,025 54,069 34,366 5251 8561 Number of facility rentals 43,358 46,432 44,363 47,772 48,097 46,904 66,846 45,741 3241 3741 Water:
Number of accounts 64,591 64,829 65,102 65,094 65,428 65,640 65,803 66,031 66,198 66,372 Annual consumption (ccf) 28,186,178 28,887,304 26,007,490 22,529,463 25,340,729 27,514,374 25,827,721 25,526,021 28,625,382 26,845,583 Electric:
Number of accounts 107,525 108,358 108,388 108,776 109,274 109,619 110,480 111,161 111,711 112,328 Annual consumption (millions of
kwh) 2,193 2,152 2,167 2,170 2,197 2,195 2,150 2,115 2,122 2,145 Sewer:
New connections 17,607 17,274 17,553 17,669 17,654 17,551 17,540 17,593 17,602 17,588 Average daily sewage treatment
(millions of gallons) 29.57 28.49 27.15 26.35 27.19 26.16 26.86 25.22 25.30 26.01 1 Reduction is due to the affects of the COVID-19 pandemic.
Source: City of Riverside, various departments
135
CITY OF RIVERSIDE
TABLE 24
CAPITAL ASSET STATISTICS BY FUNCTION
LAST TEN FISCAL YEARS
Fiscal Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Function:
Public Safety:
Police:
Stations 3 3 3 3 3 3 3 3 4 4
Substations 4 4 4 4 5 4 5 4 1 1
Helicopters 4 3 3 3 3 2 2 2 2 2
Airplane 0 0 0 0 0 1 1 1 1 1
Fire:
Stations 14 14 14 14 14 14 14 14 14 14
Active apparatus 28 28 31 33 32 33 55 32 32 32
Reserve apparatus 11 11 8 9 9 9 13 9 10 10
Training facilities 1 1 1 1 1 1 1 1 1 1
Highways and streets:
Streets (miles) 868.89 871.19 872.16 872.22 872.01 872.24 872.10 872.35 891.28 891.17 Streetlights 29,949 29,968 299,986 30,427 30,467 30,479 30,445 30,489 30,489 30,489 Signalized intersections 365 367 386 381 382 384 392 397 408 408 Culture and Recreation:
Parks acreage 2,891.0 2,911.8 2,926.8 2,983.0 2,983.0 2,988.0 2,988.0 2,988.0 2,988.0 2,988.0 Community centers 11 11 11 11 11 11 11 11 12 12
Playgrounds 43 44 44 46 46 46 46 46 46 43
Swimming pools 7 7 7 7 7 7 7 7 7 7
Softball and baseball
diamonds 44 44 44 44 44 44 44 44 44 44
Library branches 8 8 8 8 8 8 8 8 8 8
Museum exhibit-fixed 3 3 4 5 5 - 1 1 1 0 1 - 1 1
Museum exhibit-special 4 4 5 6 6 1 1 4 1 3 1 1 1 5
Water:
Fire hydrants 7,726 7,754 7,758 7,908 7,952 8,173 8,192 9,304 8,012 8,019 Sewer:
Sanitary sewers (miles) 829 829 820 829 827 820 820 820 820 853 Electric:
Miles of overhead distribution
system 513.0 513.0 513.0 513.0 513.0 514.0 514.0 513.0 513.0 513.0 Miles of underground system 810.0 814.0 815.0 817.0 826.0 831.0 834.0 838.0 838.0 838.0 1 The decrease in total numbers of Museum's exhibits is due to the closure of the Riverside Metropolitan Museum for expansion and renovation.
Source: City of Riverside, various departments
136