Salinas City Council
September 12, 2023

Tuesday, September 12, 2023
4:00 PM
City of Salinas
200 Lincoln Ave., Salinas, CA 93901
www.cityofsalinas.org

SALINAS ROTUNDA
City Council
Mayor Kimbley Craig
Councilmembers:

Carla Viviana González, District 1 - Tony Barrera, District 2 Steve McShane, District 3 - Orlando Osornio, District 4 Andrew Sandoval, District 5 - Anthony Rocha, District 6 Steven S. Carrigan, City Manager
Christopher A. Callihan, City Attorney
City Clerk’s Office: (831) 758-7381
Meeting Agenda - Final

September 12, 2023City Council Meeting Agenda - Final

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PLEDGE OF ALLEGIANCE

ROLL CALL

PROCLAMATIONS
National Childhood Cancer Awareness Month, September 2023 National Library Card Sign Up Month, September 2023
National Recovery Month, September 2023
National Hispanic Heritage Month, September 15 – October 15, 2023

PUBLIC COMMENT PROCEDURES
If you wish to make a general public comment or comment on a specific agenda item, you are encouraged to attend the City Council meeting in person. Public comment may also be submitted via email at [email protected] and will be entered into the record.

PUBLIC COMMENT TIME RESTRICTIONS
Public comments generally are limited to two minutes per speaker; the Mayor may further limit the time for public comments depending on the agenda schedule.

GENERAL PUBLIC COMMENTS
Receive public communications on items that are not on the agenda and that are in the City of Salinas’ subject matter jurisdiction. Comments on Consent, Consideration, and Closed session items should be held until the items are reached. The public may request that the legislative body consider adding an item for consideration on a future agenda. The public may comment on scheduled agenda items, including closed session items, as they are considered.

September 12, 2023City Council Meeting Agenda - Final

PRESENTATION
Councilmember comments on presentations are generally limited to three minutes.

Monterey County Water Resources Agency

PUBLIC HEARING
ID#23-438 United States Department of Housing and Urban Development Consolidated Annual Performance and Evaluation Report for FY 2022-23 Recommendation: Approve a Resolution affirming the Fiscal Year 2022-23 Consolidated Annual Performance and Evaluation Report (CAPER) and authorize submittal to the United States Department of Housing and Urban Development.

CONSIDERATION
ID#23-565
Audited Basic Financial Statements for the Year End June 30, 2022 Recommendation: Approve a Resolution approving the Audited Basic Financial Statements for Fiscal Year ended June 30, 2022.

ID#23-542
Pavement Restoration: Street Repair Plan
Recommendation: Approve a Resolution establishing the priorities for street spot repairs within each Council District.

ID#23-553
Ordinance Prohibiting Discrimination on the basis of sexual orientation, gender identity, or gender expression
Recommendation: Consider adopting an Ordinance to add article XIV to Chapter 5 of the Salinas Municipal Code to prohibit discrimination on the basis of sexual orientation, gender identity, or gender expression.

CONSENT AGENDA
All matters listed under Consent Agenda may be enacted by one motion unless a member of the Council or the public requests discussion or a separate vote.

ID#23-571
Minutes
Recommendation: Approve minutes of August 22, 2023.

ID#23-563 Financial Claims
Recommendation: Approve financial claims report.

ID#23-405 2nd Reading, Special Curb Marking Ordinance Update Recommendation: Consider adopting an Ordinance amending Chapter 20, Article VI, Stopping, Standing and Parking, of the Salinas Municipal Code.

ID#23-456
Agreement with Salinas Valley TVB, Inc for the operation of the Salinas California Welcome Center

September 12, 2023City Council Meeting Agenda - Final
Recommendation: Approve a Resolution authorizing an Agreement with the Salinas Valley TVB, Inc. to operate a California Welcome Center in Salinas; and directing staff to continue to evaluate the use of the City's Tourism Improvement District (TID) funds and to provide quarterly updates on monthly operation and financial reporting to the Finance Committee.

ID#23-496
2nd Reading, Ordinance amending Article VI of Chapter 9 of the Salinas Municipal Code - Flood Damage Prevention
Recommendation: Consider adopting an Ordinance amending Article VI of Chapter 9 the Salinas Municipal Code to update the regulations governing flood damage prevention.

ID#23-537 90-Minute Parking Zone at 431 Abbott Street
Recommendation: Approve a Resolution establishing a total of 80 feet of 90-minute parking zone located at 431 Abbott Street.

ID#23-538
Establishment of an Affordable Housing Enterprise Fund
Recommendation: Approve a Resolution authorizing the establishment of an Affordable Housing Enterprise Fund with corresponding revenue and expense accounts; and the allocation of all rental income received from City-owned properties purchased for use as affordable housing to the Affordable Housing Enterprise Fund.

ID#23-540
2023 California International Airshow Permit
Recommendation: Approve a Resolution authorizing the City Manager, or their designee to execute an Airport Use Permit for the 2023 California International Airshow, to be conducted by the Monterey County Airshow Association, Inc. at the Salinas Municipal Airport.

ID#23-541
REACH Air Medical Services, LLC Facility Lease Agreement Recommendation: Approve a Resolution authorizing the Mayor to execute a facility lease agreement between the City of Salinas and REACH Air Medical Services, LLC at the Salinas Municipal Airport.

ID#23-543
The David and Lucile Packard Foundation Fund of the Community Foundation for Monterey County Thriving Youth Strategy
Recommendation: Approve a Resolution accepting the David and Lucile Packard Foundation Fund of the Community Foundation of Monterey County grant award in the amount of $38,000 and authorize execution of all related grant acceptance documents; and the establishment of an increase of the Learning Center fund appropriation of $38,000.

ID#23-544
California Library Literacy Services ESL Literacy Grant Award Recommendation: Approve a Resolution accepting the California Library Literacy Services (CLLS) grant award in the amount of $47,385 in support of ESL Adult Literacy and authorize execution of all grant acceptance documents with the California State Library.

ID#23-550
Amendment to Professional Services Agreement with MV Cheng & Associates, Inc.

Recommendation: Approve a Resolution authorizing the City Manager to execute an amendment to a professional services agreement with MV Cheng & Associates, Inc. ("MV Cheng") for accounting, financial reporting, and other finance-related services for an additional amount of $50,000; and approving payment of $19,681.25 to MV Cheng for the cost of services previously provided to the City during Fiscal Year 2022-23.

September 12, 2023City Council Meeting Agenda - Final
ID#23-551 2024 City Council Meeting Calendar
Recommendation: Approve the 2024 City Council Meeting Calendar.

ID#23-561 United States Postal Service Building (USPS) - Office Space Lease Recommendation: Approve a Resolution approving an Office Space Lease Agreement between the City of Salinas and the USPS, for office space on the first floor of the Post Office building located at 100 W. Alisal Street, Salinas, California.

ID#23-564
Purchase and Sales Agreement for 1028 Larkin Circle
Recommendation: Approve a Resolution authorizing the Mayor to execute a Purchase and Sales Agreement (PSA) in the amount of $690,000 for a single-family residence located at 1028 Larkin Circle in the City of Salinas utilizing the American Rescue Plan Act (ARPA) funding for the purchase.

ID#23-566
Permit Center Reorganization, Reclassification, and Workforce Allocation Adjustment
Recommendation: Approve a Resolution amending the FY23-24 workforce for the Permit Services Division of the Community Development Department.

COUNCILMEMBERS’ REPORTS, APPOINTMENTS AND FUTURE AGENDA ITEMS Receive communication from Councilmembers on reports, appointments and future agenda items. Councilmember comments are generally limited to three minutes.

CLOSED SESSION
Receive public communications from the audience on Closed session items.

The City Council will recess to closed session pursuant to:

ID#23-570
a. Labor Negotiations - California Government Code Section 54957.6, with its designated labor representatives Steven S. Carrigan, City Manager; Jim Pia, Assistant City Manager/Acting Finance Director; Christopher A. Callihan, City Attorney; Katherine Hogan, Assistant City Attorney; Marina Horta-Gallegos, Human Resources Director; Sylvia Enriquez, Senior Human Resources Analyst; Che Johnson, Liebert Cassidy Whitmore, regarding labor relations with Service Employees International Union (SEIU), SEIU Supervisors, Salinas Municipal Employees Association/SEIU, Association of Management Personnel, Police Officers Association, Police Management Association, International Association of Firefighters, Fire Supervisors Association, Confidential Management Employees, Confidential Non-Management Employees, and Department Directors.
b. Pending Litigation - California Government Code Section 54956.9(d)(1), conference with legal counsel regarding, Santa Rita Union High School District, et al. v. City of Salinas et al., Monterey County Superior Court Case No. 20CV000242.
c. Pending Litigation - California Government Code Section 54956.9(d)(1),

September 12, 2023City Council Meeting Agenda - Final
conference with legal counsel regarding, Alisal Union School District, et al. v. City of Salinas, et al., Monterey County Superior Court Case No. 20CV00340.

ADJOURNMENT
_____________________________
Patricia M. Barajas, City Clerk

AGENDA MATERIAL / ADDENDUM
Any addendums will be posted within 72 hours of regular meetings or 24 hours of special meetings and in accordance with Californian Government Code Section 54954.2 and 54956. City Council agenda reports and other writings distributed to the legislative body may be viewed at the Salinas City Clerk’s Office, 200 Lincoln Avenue, Salinas, and are posted on the City’s website at www.cityofsalinas.org in accordance with California Government Code section 54597.5. The City Council may take action that is different than the proposed action reflected on the agenda.

Disability-related modification or accommodation, including auxiliary aids or services, may be requested by any person with a disability who requires a modification or accommodation in order to participate in the meeting. Language interpretation may be requested as soon as possible but by no later than 5 p.m. of the last business day prior to the meeting. Requests should be referred to the City Clerk’s Office At 200 Lincoln Avenue, Salinas, 758-7381, as soon as possible but by no later than 5 p.m. of the last business day prior to the meeting. Hearing impaired or TTY/TDD text telephone users may contact the city by dialing 711 for the California Relay Service (CRS) or by telephoning any other service providers’ CRS telephone number.

PUBLIC NOTIFICATION
This agenda was posted on September 7, 2023 in the Salinas Rotunda and City's website.

Meetings are streamed live at https://salinas.legistar.com/Calendar.aspx, televised live on Comcast Channel 25 and on http://www.youtube.com/thesalinaschannel at 4:00 p.m. on the date of the regularly scheduled meeting and will be broadcast throughout the day on Friday, Saturday, Monday and Wednesday following the meeting. For the most up-to-date Broadcast Schedule for The Salinas Channel on Comcast 25, please visit or subscribe to our Google Calendar located at http://tinyurl.com/SalinasChannel25. All past City Council meetings may also be viewed on the Salinas Channel on YouTube at http://www.youtube.com/thesalinaschannel.

City of Salinas
Legislation Text
200 Lincoln Ave., Salinas,
CA 93901
www.cityofsalinas.org
File #: ID#23-438, Version: 1
United States Department of Housing and Urban Development Consolidated Annual Performance and Evaluation Report for FY 2022-23
Approve a Resolution affirming the Fiscal Year 2022-23 Consolidated Annual Performance and Evaluation Report (CAPER) and authorize submittal to the United States Department of Housing and Urban Development.

City of Salinas Printed on 9/7/2023Page 1 of 1
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CITY OF SALINAS

COUNCIL STAFF REPORT

DATE: SEPTEMBER 12, 2023
DEPARTMENT: COMMUNITY DEVELOPMENT
FROM: LISA BRINTON, DIRECTOR
THROUGH: ROD POWELL, ASSISTANT DIRECTOR
BY: CRISTINA GONZALEZ, COMMUNITY DEVELOPMENT ANALYST

FRANCISCO BRAMBILA, ACTING PLANNING MANAGER
TITLE: UNITED STATES DEPART MENT OF HOUSING AND URBAN

DEVELOPMENT CONSOLIDATED ANNUAL PERFORMANCE AND
EVALUATION REPORT FOR FY 2022-23

RECOMMENDED MOTION:

It is recommended that City Council a pprove a r esolution affirming the Fiscal Year 2022-23 Consolidated Annual Performance and Evaluation Report and authorizing submittal to the United States Department of Housing and Urban Development.

EXECUTIVE SUMMARY:

The City of Salinas (City), as a designated entitlement jurisdiction, is a direct funding recipient of the United States Department of Housing and Urban Development’s (HUD) Community Development Block Grant (CDBG), HOME Investment Partnerships (HOME) , HOME American Rescue Plan (HOME-ARP), and Emergency Solutions Grants (ESG) Programs. As a requirement of the continued receipt of entitlement funding, each year the City must compile and submit a Consolidated Annual Performance and Evaluation Report (CAPER) to United States Department of Hous ing and Urban Development (HUD). The CAPER provides a comprehensive summary of expenditures, activities, and accomplishments for each of the City’s HUD programs for the past fiscal year. This document also serves as a mechanism and opportunity for public evaluation regarding the City’s progress in carrying out goals and objectives as stated in its FY 2020 -24 Consolidated Plan (Con Plan) and FY 2022-23 Annual Action Plan (AAP). The CAPER is due to HUD no later than ninety (90) days after the end of the City’s FY 2022-23. This year, the CAPER is due to HUD no later than September 30, 2023.

BACKGROUND:

The CAPER is a one-year evaluative summary document which describes all eligible projects, programs and activities funded through CDBG, CDBG-CV, HOME, HOME-ARP, ESG and ESG - CV funds and their relationship to the City’s housing, homelessness, and community development Page | 2
priorities and needs. In accordance with the City’s adopted Citizen Participation Plan (CPP), HUD requires a minimum fifteen (15) day public comment period for the CAPER. In compliance with this mandate, a draft CAPER public notice was published in The Monterey Herald on August 26, 2023.

The draft CAPER was also made available to the public on the City’s website; at City libraries, City Hall, and the Community Development Department office building; and by request through mail or email. The public comment period for the FY 2022-23 CAPER began on August 26, 2023, and ends on September 12, 2023. This City Council public hearing provides an additional opportunity for the public to provide City Council feedback regarding the draft CAPER and provide input on community development needs within the City. A summary of all public comments received duri ng the public comment period will be included in the City’s final CAPER submission to HUD.

DISCUSSION:

Entitlement Funding & Program Income (PI)
The City is an entitlement jurisdiction for CDBG, CDBG-CV, HOME, HOME-ARP, ESG and ESG- CV programs. HUD provides annual grants on a formula basis to entitled cities and counties to develop viable urban communities by providing decent housing and a suitable living environment and by expanding economic opportunities, principally for low - and moderate-income persons. The City also utilizes program income (PI) related to its various entitlement funds to further fund certain eligible activities on an annual basis. PI is the gross income received by the City that is generated from the use of CDBG and HOME funds. The table below represents total entitlement funding and PI available for FY 2022-23 for CDBG, CDBG-CV, HOME, HOME-ARP, ESG and ESG-CV.

Funding Source Entitlement
Amount
Program
Income
Total Funding
Available
Total
Expenditures
CDBG $7,895,276* $78,850 $7,974,126 $1,361,221
CDBG-CV $784,463** $0 $784,463 $146,103
HOME $2,038,430* $93,841 $2,132,271 $121,982
HOME-ARP $2,918,774 $0 $2,918,774 $0
ESG $520,705* $0 $520,705 $465,992
ESG-CV $1,752,704** $0 $1,752,704 $1,646,889
Total $15,910,352 $172,691 $16,083,043 $3,745,427
*Includes remaining funds from prior years.
**Remaining funds from one time allocation.

Community Development Block Grant (CDBG)
CDBG Entitlement Funds may be used to provide decent housing, support suitable living conditions, and expand economic opportunities, principally for low- and moderate-income persons. CDBG funds may be used for activities which include, but are not limited to:
 Acquisition of real property
 Relocation and demolition
 Rehabilitation of residential and non-residential structures Page | 3
 Construction of public facilities and improvements, such as water and sewer facilities, streets, neighborhood centers, and the conversion of school buildings for eligible purposes  Public services (up to 15% of CDBG allocation)
 Activities relating to energy conservation and renewable energy resources  Provision of assistance to profit-motivated businesses to carry out economic development and job creation/retention activities
In FY 2022-23, the City utilized CDBG funds to support public services, economic development, and public facilities. The following tables show the activities performed with CDBG Entitlement and CDBG-CV funds and their accomplishments for FY 202 2-23. Due to the Covid -19 pandemic, implementation of some programs and activities have been delayed.

CDBG Program
Agency Activity Name Funding
Category
Available
Funding Expenditures Outcome
City of Salinas
Program
Administration
(20% Grant & PI)
Administration $430,343 $430,343 N/A
City of Salinas Sherwood Recreation
Center – Phase 4
Public
Facility $1,898,663* $5,715 Public Facility
City of Salinas Hebron Recreation
Center
Public
Facility $1,406,613* $251,306 Public Facility
City of Salinas Chinatown
Improvements
Public
Facility $577,980 $0 Public Facility
First United
Methodist Church Kitchen Remodel Public
Facility $466,866* $304,285 Public Facility
Alisal Union
School District
Buckhorn Early
Childhood
Development Center
Public
Facility $968,000* $4,321 Public Facility
Interim Inc. Catalyst Apartments
Rehabilitation Housing $518,144* $142,270 5 Housing
Units
City of Salinas
Natividad Creek and
Closter Park
Restroom Renovation
Public
Facility $798,633* $54,041 Public Facility
Interim Inc. Sun Rose Apartments Housing $540,996* $147,459 1 - 8-bed Housing Unit
ECHO
Fair Housing and
Tenant/Landlord
Services
Public Service $100,000 $91,582 165
Households
City of Salinas Salinas Outreach and
Response Team Public Service $135,800 $0 Households
* Includes funding from previous fiscal years
Page | 4
CDBG-CV Program
Agency Activity Name Funding
Category
Available
Funding*
FY 2022-23
Expenditures Outcome
City of Salinas
Program
Administration
(20% of Grant)
Administration $480,031 $57,830 N/A
City of Salinas
Housing
Information,
Referral Services
& Fair Housing
Public Service $400,000 $52,164 272
Households
City of Salinas
Economic
Development and
Technical
Assistance
Public Service $375,000 $79,614 52
Businesses
Downtown
Streets Inc.

Salinas Downtown
Streets Team Public Service $238,000 $113,122 113
Persons
Eden Council
for Hope and
Opportunity
Fair Housing &
Tenant/Landlord
Services (CV)
Public Service $184,000 $51,582 23
Households
* Available funding since start of program
Emergency Solutions Grant (ESG)
The ESG and ESG -CV programs utilize federal funds to support communities in providing street outreach, emergency shelter, rental assistance, and related services. These programs provide resources for adults and families with children experiencing or are at-risk of homelessness. The street outreach and emergency shelter program components are capped at 60 % of the ESG total funding.

This 60% cap was waived by HUD for ESG-CV funds. Additional uses of the ESG and ESG-CV are to provide homelessness prevention assistance to households who are at risk of homelessness, and assistance to rapidly re-house persons who are experiencing homelessness. ESG and ESG-CV funds also provide assistance including short -term or medium -term rental assistance, housing navigation and placement, and housing stability case management.

The City’s ESG allocation for FY 2022 -23 was $178,942, however the City had $341,763.33 of unexpended funds from prior years for a total of $520,705.33 of available fu nds for FY 2022 -23.

From the original award, the City had $1,752,703.69 in available ESG-CV funds at the beginning of FY 2022 -23 to continue funding essential ser vices. The following tables show the agency name, program funded, total number of unduplicated persons served, budgeted amount, and total FY 2022- 23 expenditures.

Page | 5
ESG Program
Agency Activity Name Funding
Category
Available
Funding* Expenditures Outcome
City of Salinas Program
Administration Administration $39,793 $24,564 N/A
City of Salinas
Salinas Outreach
and Response
Team (SORT)
Public Service $237,000 $187,668
384
Persons Bay Area
Community
Services (BACS)
SHARE & Rapid
Re-Housing Public Service $198,605 $198,584
*Includes funding from previous fiscal years.

ESG – CV Program
Agency Activity Name Funding
Category
Available
Funding* Expenditures Outcome
City of Salinas
Program
Administration
(10% of Grant)
Administration $643,217 $77,602 NA
University
Corporation at
Monterey Bay
Rapid Re-housing
(RRH) Program Public Service $381,890 $256,810
996
Persons
CCCIL
RRH, Outreach, and
Shelter Services Public Service $733,505 $3,359
Coalition of
Homeless
Services
Providers
HMIS System
Operator Public Service $37,545 $37,545
Community
Homeless
Solutions
Chinatown
Navigation Center,
Shelter and Trailers
Operations
Public Service $1,546,634 $348,770
Downtown
Streets Team,
Inc.

Salinas Downtown
Streets Team - Street
Outreach
Public Service $575,739 $168,162
Interim, Inc. MCHOME Public Service $250,000 $82,642
City of Salinas SORT & Sanitation
Stations
Public Service $488,207 $139,536
Bay Area
Community
Services
SHARE Center
Operations
Public Services $532,465 $532,465
*Available funding since start of the program.

HOME Investment Partnerships Program
The HOME Investment Partnerships Program supports local housing strategies intended to increase home ownership and affordable housing opportunities for low - and very low -income households.

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Eligible uses of funds include tenant -based rental assistan ce, housing rehabilitation , assistance to homebuyers, and new construction of housing. HOME funding may also be used for site acquisition, site improvements, demolition, relocation, and other necessary and reasonable activities related to the development of non-luxury housing.

In FY 2022-23, the City used HOME grant funds for housing activities that expanded the supply of decent, safe, and affordable housing. The FY 2022-23 HOME housing development funds have yet to be allocated to a specific development project, but the City’s does have several potential projects moving forward and intends to commit these funds as soon as an appropriate development timelines and other committed source funding is in place.

HOME Program
Agency Activity Name Funding
Category
Available
Funding* Expenditures Outcome
City of Salinas Program
Administration Administration $418,419 $114,036 N/A
Monterey
County Housing
Development
Corporation
Parkside Manor
Phase I Housing $1,017,540 $7,947 6 Housing
Units
To be
committed in the
future
To be committed
on the future Housing $ 1,705,905 $0 TBD
* Includes funding from previous fiscal years.

HOME American Rescue Plan
The Allocation Plan for the HOME ARP was developed and submitted to HUD on March 21, 2023, and approved on May 26, 2023. In its Plan, the City recommended that 15% of its HOME -ARP allocation ($437,816.10) be used for allowable program administration and planning activities and that the remaining allocation of $2,480,957.90 (85%) be directed toward supportive service funding associated with two of three Homekey permanent supportive housing sites (Step Up on Sanborn and Step Up on Fairview) and other emerging “bed generating” projects. It is estimated that up to ninety- nine (99) Homekey units for qualifying populations could be supported with the recommended HOME-ARP AP. This recommendation is strongly supported by the robust input provided by local service providers, stakeholders, and other community organizations during the required consultation process. Expenditure of HOME ARP funds are not projected to occur until FY 26-27.

HOME-ARP Program
Agency Activity Name Funding
Category
Available
Funding Expenditures Outcome
City of Salinas Program
Administration Administration $437,816.10 $0 N/A
Page | 7
Step Up on
Second St
Step Up on
Sanborn Supportive
Services $2,480,957.90 $0 Persons Step Up on
Fairview
CEQA CONSIDERATION:

The City of Salinas determined that the proposed action is not a project as defined by the California Environmental Quality Act (CEQA) per Guidelines Section 15378.

STRATEGIC PLAN INITIATIVE:

HUD funded activities and projects are supportive of City of Salinas Strategic Plan 2022-2025 Goals and Strategies relative to Economic Development, Housing/Affordable Housing, and Effective and Culturally Responsive Government.

DEPARTMENT COORDINATION:

This agenda item originates from the City’s CDD Housing & Community Development Division with coordination and consultation of other City departments including the City Attorney , and Finance, Public Works, and Library and Community Services Departments.

FISCAL AND SUSTAINABILITY IMPACT:

There is no direct fiscal impact the General Fund. HUD entitlement fund allocation s are provided directly to the City by HUD and require no commitment of matching City funds.

ATTACHMENTS:

Resolution
FY 2022-23 CAPER – Draft
1 RESOLUTION NO. _________ (N.C.S.)
A RESOLUTION OF THE SALINAS CITY COUNCIL AFFIRMING THE FY 2022-23

CONSOLIDATED ANNUAL PERFORMANCE AND EVALUATION REPORT AND

AUTHORIZING SUBMITTAL TO THE UNITED STATES DEPARTMENT OF

HOUSING AND URBAN DEVELOPMENT
WHEREAS, the FY 2022-23 Consolidated Annual Performance and Evaluation Report (CAPER) is an annual report describing eligible projects, programs and activities that were undertaken with United States Department of Housing and Urban Development (HUD) Community Dev elopment Block Grant (CDBG) Program, CDBG CARES Act COVID -19 (CDBG-CV), Home Investment Partnerships Program (HOME) , HOME American Rescue Plan (HOME-ARP), Emergency Solutions Grants (ESG) Program, and ESG -CV funds for the period of July 1, 2022 through June 30, 2023; and
WHEREAS, the FY 2022-232 CAPER summarizes the City of Salinas’ (City) progress in meeting the public service, community development, and affordable housing needs in relation to the 20 20-24 Consolidated Plan (Con Plan) and FY 2022 -23 Annual Action Plan (AAP) for activities carried out under CDBG, CDBG -CV, HOME , HOME -ARP, ESG and ESG -CV programs; and
WHEREAS, in accordance with 24 CFR Part 91.105, the City is required to conduct a public hearing each year to obtain citizens’ views on housing and community development needs; and
WHEREAS, HUD regulations in accordance with the City’s adopted Citizen Participation Plan (CPP) requires a minimum fifteen (15) day CAPER public comment period; and WHEREAS, the FY 2022-23 CAPER is due to HUD no later than September 30, 2023; and
WHEREAS, a notice was published in The Monterey Herald on August 2 6, 2023 , announcing the minimum fifteen (15) day CAPER public comment period beginning August 26, 2023 through September 12, 2023 and informed the public of an upcoming public hearing at the City Council meeting scheduled for September 12, 2023; and WHEREAS, at that scheduled hearing, the City Council accepted comments on housing and community development needs in a public hearing announced for that purpose; and NOW, THEREFORE, BE IT RESOLVED that the Salinas City Council hereby affirms the FY 2022-23 CAPER and authorizes the submission to HUD including all public comments received; and
BE IT FURTHER RESOLVED that the Salinas City Council hereby authorizes the City Manager or designee, for and on behalf of the City, to submit the FY 2022-23 CAPER to HUD by September 30, 2023.

PASSED AND APPROVED this 12th day of September 2023, by the following vote:
2 AYES:

NOES:

ABSENT:

ABSTAIN:

APPROVED:

______________________________
Kimbley Craig, Mayor

ATTEST:

____________________________
Patricia M. Barajas, City Clerk

DRAFT

DRAFT

CAPER i
OMB Control No: 2506-0117 (exp. 07/31/2015)
Table of Contents

CR-05 - Goals and Outcomes.................................................................................................................................... 1 CR-10 - Racial and Ethnic composition of families assisted ...................................................................................... 9 CR-15 - Resources and Investments 91.520(a) ...................................................................................................... 10 CR-20 - Affordable Housing 91.520(b) .................................................................................................................... 17 CR-25 - Homeless and Other Special Needs 91.220(d, e); 91.320(d, e); 91.520(c) ................................................ 19 CR-30 - Public Housing 91.220(h); 91.320(j) ........................................................................................................... 21 CR-35 - Other Actions 91.220(j)-(k); 91.320(i)-(j) .................................................................................................... 22 CR-40 - Monitoring 91.220 and 91.230 .................................................................................................................... 26 CR-45 - CDBG 91.520(c) ......................................................................................................................................... 27 CR-50 - HOME 91.520(d) ........................................................................................................................................ 28 CR-58 – Section 3 ................................................................................................................................................... 31 CR-60 - ESG 91.520(g) (ESG Recipients only) ....................................................................................................... 33 CR-65 - Persons Assisted ....................................................................................................................................... 35 CR-70 – ESG 91.520(g) - Assistance Provided and Outcomes ............................................................................... 38 CR-75 – Expenditures ............................................................................................................................................. 39 Attachment A: Public Participation ......................................................................................................................... A-1 Attachment B: Monitoring Procedures ................................................................................................................... B-1 Attachment C: IDIS Report – PR 26 ...................................................................................................................... C-1 Attachment D: CAPER Resolution ......................................................................................................................... D-1

DRAFT

CAPER 1
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-05 - Goals and Outcomes
Progress the jurisdiction has made in carrying out its strategic plan and its action plan. 91.520(a) This is an overview that includes major initiatives and highlights th ose that were proposed and executed throughout the program year. The City of Salinas (City) is designated as an entitlement community for three funding programs administered by HUD: Community Development Block Grant (CDBG); HOME Investment Partnerships; and Emergency Solutions Grants (ESG). The FY 2022-23 Consolidated Annual Performance Evaluation Report (CAPER) describes the City’s affordable housing and community development activities between July 1, 2022, through June 30, 2023. The CAPER also provides an evaluation of the City’s progress in carrying out the goals and objectives as stated in the Five-Year Consolidated Plan FY 2020–24 and the FY 2022-23 Action Plan. This CAPER also reports on the activities performed with CDBG-CV and ESG-CV funds.

Affordable Housing Multi-Family and Single-Family:
▪ Housing Services Program: The Housing Services Program was suspended due to staffing shortage and no allocation of funds during FY 2021-22 or FY 2022-23. The Program is currently being re -evaluated, and the City intends to re-instate this program in the future. ▪ Parkside Manor Housing Developme nt Project – Phase I : The Parkside Manor Housing Development Project – Phase I is located at 1112 Parkside Street in the City of Salinas. In FY 2021 -22, the developer , Monterey County Housing Authority Development Corporation (MCHADC) , demolished 48 existi ng senior housing units and committed to the construction of 80 new senior residential units, along with supporting improved infrastructure and amenities . Parkside Manor Housing Development Project - Phase I received a total of $1,017,540 of HOME funds . As of the end of the fiscal year , 98% of the funds ($938,389.20) were disbursed to the Housing Authority of the County of Monterey. The City retains 2% of the funds ($19,150.80) until the project is completed and all closeout data are received. Construction of the building was completed on November 23, 2022, and had its grand opening on January 19, 2023. The City and the Housing Authority of the County of Monterey are currently working on the final closing documents and final disbursement of the HOME funds.
▪ Sun Rose Apartments Project: The Sun Rose Apartments is a new construction project being developed by Interim Inc. This new housing facility w ill include an 11-unit transitional and permanent housing unit with supportive services for 18 very low -income i ndividuals with mental health disabilities who are homeless, chronically homeless, or at-risk of homelessness. The facility includes a three-story building with two patios, eight parking spaces, seven 1-bedroom units, three studio units , and an 8 -bedroom t ransitional unit with shared amenities. The project was awarded $547,860 in CDBG funds for construction and an additional $47,860 for Activity Delivery funds . In conjunction with the CDBG funds, the City extended its support by providing an additional $500,000 in the form of a loan using Housing Successor Agency (HSA) Funds. This financial boost became necessary to navigate the increase of construction costs. However, the project encountered noteworthy setbacks in establishing power supply to the facility due to PG&E-related challenges.

Despite these setbacks, the project is on track to be finalized in the summer of 2023. ▪ Catalyst Apartments Rehabilitation Project: The rehabilitation of the Catalyst Apartments , an affordable rental complex, was spearheaded by Interim Inc., a non-profit developer, beginning March of 2021. The project was awarded $500,000 for the rehabilitation of the five unit one-bedroom apartment complex which will house individuals with mental disabilities and $50,000 for Activity Delivery. The rehabilitation included significant improvements to the building exterior, interior and common areas. The project was completed in January 2022. City and Interim staff reconciled all close out documents, issued the final payment, and close the project in IDIS in June of 2023.

HOME American Rescue Plan: The Allocation Plan (AP) for the HOME American Rescue Plan (ARP) was submitted to HUD for final review and approval in October of 2022. By January 2023, HUD granted its final approval and awarded DRAFT

CAPER 2
OMB Control No: 2506-0117 (exp. 07/31/2015)
a total of $2,918,774. The City is proposing to fund supportive services at two HomeKey sites, both currently undergoing rehabilitation. These sites will collectively create 101 affordable rental housing units to house persons experiencing homelessness. The supportive services for participants of the program will include but are not limited to case management, housing services and counseling, transportation, financial assistance, and substance abuse treatment.

It is anticipated that the financial allocation for supportive services w ill be sustained for a minimum duration of four years with an estimated annual budget of $620,000.

Homeless Facilities and Services: The City continued to fund homeless services and facilities using ESG funds. The following services have been provided through ESG to date:
▪ Salinas Outreach and Response Team (SORT): SORT was d eveloped during FY 2021 -22, to provide outreach and engagement services to unsheltered encampments. A total of 41 persons were enrolled in street outreach services through ESG. In FY 2022-23 a total of 187 persons were enrolled and engaged in case management services. 19 persons were successfully housed through street-based coordination and support.

A total of 3 persons successfully entered into an emergency shelter program. ▪ Salinas Housing Advancement, Resources & Education (SHARE) C enter: During FY 2021 -22 the City and Monterey County joined efforts to fund the SHARE Center operated by Bay Area Community Services (BACS). The SHARE Center is a 24-hour shelter and housing navigation center located at 845 E. Laurel Drive in Salinas. During FY 2022-23 a total of 122 persons were served and 53 persons secured housing through financial assistance.

In addition, the City provided funding for the development of Sun Rose Apartments, a supportive housing facility of 11 units to benefit persons with mental illness . The City also provided funding for the rehabilitation the Catalyst Apartments, a five-unit apartment complex,. This project also assisted and benefited persons with mental illnesses (see “Affordable Housing Multi-Family and Single-Family” Projects above for more details).

Neighborhood Conditions: During FY 2022-23, one public service program was funded with CDBG funds. ▪ Fair Housing and Tenant/Landlord Service s Program: Eden Council for Hope and Opportunity (ECHO) provides fair housing counseling and investigation and tenant/landlord counseling and conciliation regarding rental housing rights and responsibilities and the protections available regarding laws and ordinances. ECHO assisted163 households during this fiscal year.

Public facilities and improvements:
▪ Hebbron Family Center Project: The Hebbron Family Center Project is located on 683 Fremont Street. This project is being developed and manage by the City’s Public Works and Library and Community Services Departments. The project was awarded $1,306,613 in CDBG Entitlement Funds from FY 2020-21 and FY 2021-22 CDBG program funds for the soft cost activities of the project and $100,000 for Activity Delivery. The funds are earmarked for the soft costs of the project which include: design, development, and project/construction management. In FY 2022 -23, the E nvironmental Assessment for the project was completed submitted to HUD in November 2022. Subsequently in December 2022, the demolition permit for the center was approved and in A pril of 2023, the existing Hebbron Family Center was demolished. The design and development team continued to work on the schematics and design of the new center. The project will continue into FY 2023-24 and is expected be completed by April of 2025. ▪ Sherwood Recreation Center Project – Phase IV: The Sherwood Recreation Center is located on 920 N.

Main Street. This project is being manage by the City’s Community Development and Library and Community Services Departments. The CDBG Entitlement funding for Phase IV of this project was initially allocated under FY 2020 -21 and FY 2021 -22 AAP and it included a total of $1,728,633 for the direct construction and improvements of the project and $170,000 for Activity Delivery. The City identified an emerging project, the Hebbron Family Center, which required prioritization of funds. This urgency required to reallocate a portion of the funds from the Sherwood Recreation Center to the Hebbron Fam ily Center project and this was done through a substantial amendment. The amounts reallocated from the Sherwood Recreation Center – Phase IV were then allocated under the City’s FY 2022 -23 AAP to carry forward with this project as intended . On DRAFT

CAPER 3
OMB Control No: 2506-0117 (exp. 07/31/2015)
December 2022, the City completed an Exempt ERR for emergency roof repairs due a severe storm. On November 2022, City staff released a Request for Qualifications (RFQ) for a Project and Construction Management consultant to assist the Housing and Community Development Division with several public facility projects. This RFQ incl uded the S herwood Recreation Center – Phase IV . The RFQ closed on December 2022 with two proposals submitted. City staff reviewed proposals and conducted interviews. CSG Consultants, Inc. (CSG) were the selected company to assist the City with these services. The City entered into a Master Services Agreement with CSG in February of 2023. CSG begun the design phase of the project as well as the CEST level ERR for the construction pieces of the project. The design and environmental review phase of the project are expected to be completed by December 2023. The project is expected be completed by June 2024.
▪ Chinatown Neighborhood Improvements: The Chinatown Neighborhood Improvements is not project that includes one parcel, but rather the Chinatown neighborhood in the City of Salinas. This project is being manage by the City’s Community Development Department. The potential project area is to match the same area of the Chinatown Revitalization Plan. This neighborhood project received a total of $577,980 in CDBG Entitlement funds towards construction activities with an additional $30,000 earmarked as Activity Delivery.

In FY 2022-23, City staff collaborated with the Salinas Downtown Community Board which includes stakeholders from the business sector, nonprofits, and neighborhood residents. This board is focused on preserving the histor y and cultural identity of the Salinas Chinatown. Eighty-six (86%) percent of board members participated in a survey to reestablish priorities and identify implementation projects for funding in the Chinatown neighborhood. Feedback revealed strong support for infrastructure , sanitation, and beautification projects. On August 2022 , City staff completed an Exempt Environmenta l Review Record for the soft cost activities of the project. On the RFQ for Project and Construction Management that was released in December 2022, this project was included. City staff have engage CSG to begin working on the project.

The City also started collaborating with the Public Works Department to narrow down a more specific project in the Chinatown neighborhood that can be accomplished with the awarded CDBG funds. ▪ First United Methodist Church Kitchen Rehabilitation: The FUMC is located at 404 Lincoln Avenue. The project is being manage by the Salinas First United Methodist Church Project. The project was awarded $494,662 of CDBG Entitlement Funds from FY 2017 -18 for the rehabilitation activities of the project . The project was schedule to be completed in FY 2022 -23, yet due to construction supply shortages, the project completion was delayed, and an extension was granted for construction and expenditure of funds to September 2023. In FY 2022-23, the City disbursed $326,814.54 and retained 5% of the funds ($24,743.10) until project completion. Projected completion for the facility is projected for September of 2023. ▪ Early Childhood Development Center (ECDC): The ECDC project is located on 1018 Buckhorn Drive. This project is being manage by the Alisal Union School District (AUSD) and the project received $880,000 of CDBG Entitlement Funds for the construction of the project and an additional $88,000 for Activity Delivery from FY 2019-20. In FY 2022-23, the City and AUSD completed and executed the CDBG and the Land Use Disposition (LDA) Agreements. AUSD submitted this project to the California Division of the State Architect (DSA) for review and approval and expects final approval for the project by September 2023. If approved on- time, the project may be taken out to bid on November 2023, start construction by January 2024, be completed by January 2025 and be placed in operations by May 2025. ▪ Natividad Creek and Closter Park Restroom Rehabilitation Projects: Initially this project was going to include two parks, the Natividad Creek Park and the C loster Park, yet, due to budget constraints and cost, City staff determined to move only with one project , the Natividad Creek Park Restroom Rehabilitation. This project is located on 1395 Nogal Drive. This project is being managed by City’s Community Development and Library and Community Services Departments. The rehabilitation activities of this project included ADA upgrades inside and outside the restroom as well as new ADA parking stalls. The City awarded $442,070 in CDBG Entitlement funds through its FY 2019-20 AAP. In FY 2022 -23, City staff released two Request for Proposals (RFP), in December 2022 and April 2023 , but was unable to award contract. After the two unsuccessful RPF’s, staff directly requested proposals from contractors, and awarded the contract to HA DRAFT

CAPER 4
OMB Control No: 2506-0117 (exp. 07/31/2015)
Construction on June 20, 2023. Projected is scheduled to begin construction in September 2023 and rehabilitation activities are expected to be completed by the end of 2023.

CDBG-CV
The City received $1,190,782 as CDBG -CV1 funds and $1,209,375 in CDBG -CV3 funds, for a total of $2,400,157 in CDBG-CV funds through a Substantial Amendment to the FY 2019 -20 AAP. The City continued to expend the CV funds over the FY 2022-23 period. Specifically, the following activities were underway:
▪ Eden Council for Hope and Opportunity (ECHO): ECHO is educating the community regarding the housing protections available post COVID-19. In addition, ECHO responds to fair housing complains, conducts audits, and provides conciliation and mediation services. ECHO assisted 170 persons. ▪ Salinas Downtown Street Team : This program launched cleanup crews in Chinatown and Downtown Salinas comprised of unhoused Team Members who would receive basic needs stipend for their participation.

Team Members are provided with case management services related to housing stability. Team Members will receive pre-employment services to facilitate their path to regular employment. This program assisted 113 persons in FY 21-22. In FY 22-23 this program served 50 persons through regular CDBG funds. ▪ City of Salinas Housing Information and Referral Services: The City of Salinas has been providing housing information, education, and referral services to Salinas reside nts through the Emergency Rental Assistance Program (ERAP), created in response to the COVID-19 Pandemic. As of June 2023, the City of Salinas has assisted 272 households through the ERAP Program. ▪ The Grow Salinas Fund (GSF) / Economic Development Technical Assistance: Through this activity City of Salinas Business Navigator assisted about 285 unduplicated businesses and 233 duplicated businesses.

Of those 389 were located in the ANSRA, 292 were existing businesses and 97 were new. About 129 were located outside of this area and 97 were existing and 32 were new. 3 businesses located outside of the ANSRA are currently being assisted for the City's Outdoor Dining Forgivable Loan Program. For the City of Salinas Marketing and Technology Micro -Grants, 7 businesses located outside of t he ANSRA are being assisted in the process and one has been fully funded , 22 businesses located in the ANSRA are being assisted in the application process and 5 have been fully funded. Additionally, b usinesses were assisted through emails, phone calls, acquiring a nd renewing business licenses, referrals to co mmunity business organizations and promotion of workshops.

ESG-CV
The City was awarded a total of $6,432,171 in ESG-CV funds through a Substantial Amendment to the FY 2019 -20 AAP, and continued to spend the CV funds over the FY 202 2-23 period. From the ori ginal award , the City had $1,752,703.69 in available ESG-CV funds at the beginning of FY 2022-23 to continue funding essential services such as Rapid Re -housing, Emergency Shelter, Street Outreach, HMI S, and grant administration for the homeless population. By the end of the fiscal year, the City had $105,814.24 in funds remaining from this program. There are no additional plans from Congress to fund ESG-CV program as it was a program to respond to the COVID-19 pandemic.

The following activities were underway during FY 2022-23:
▪ Coalition of Homeless Providers (CHSP): CHSP serves as the HMIS program coordinator and CE lead agency for the Monterey and San Benito Counties. During FY 2022-23 CHSP expended $37,545 to continue serving as the HMIS program coordinator.
▪ Salinas Housing Advancement, Resources & Education (SHARE) Center : During FY 2021 -22 the City and Monterey County joined efforts to fund the SHARE Center operated by BACS. The SHARE Center is a 24-hour shelter and housing navigation center located at 845 E. Laurel Drive in Salinas. During FY 2022-23 BACS expended a total of $532,465 in Emergency Shelter funds to serve 122 persons. ▪ Emergency Shelter for Persons with Disabilities program : (CCCIL): Final disbursement of $3,358.55 for Central Coast Center for Independent Living ’s (CCCIL) Emergency Shelter for Persons with Disabilities DRAFT

CAPER 5
OMB Control No: 2506-0117 (exp. 07/31/2015)
program was done in FY 2022-23. This disbursement was for the Emergency Shelter and Rapid Re-housing components. All persons served under this program were reported in prior fiscal year. ▪ Chinatown Navigation Center (CNC): The CNC provides overnight shelter seven days per week to single homeless women and men. Community Homeless Solutions (CHS) served as the operator for the CNC. There were $348,769.60 in Emergency Shelter expenses during FY 2022-23. Clients are provided warm meals, a sleeping area and security services. Overall, the CNC provided 11,750 bed nights of emergency shelter and served a total of 214 persons.
▪ Downtown Street Team (DTS): There were a total of $168,161.66 in Street Outreach disbursements during FY 2022-23 and served 56 persons through ESG-CV with an opportunity to become a cleanup crew member and receive case management and employment training.
▪ MCHOME Program: A total of $82,641.91 were disbursed during FY 2022-23 to Interim Inc., to provide street outreach and emergency shelter services through motel vouchers to homeless individuals with serious mental illness. Interim outreached 26 individuals and provided 343 bed nights of emergency shelter. ▪ Emergency Motel Program Services and Rapid Re -housing Services : A total of $256,809. 98 were disbursed for these two programs by University Corporation at Monterey Bay (UCMB), which provided street outreach and rapid rehousing stabilization services to 422 persons. FY 22-23 UCMB continued to partner with CCCIL to operate the Emergency motel program. A total of 84 persons were served through ESG-CV and a total of 23 persons were permanently housed.
▪ Salinas Outreach and Response Team (SORT): The City created SORT in FY 2021-22 to better serve and coordinate services for the homeless community during the COVID-19 pandemic. In FY 202 2-23 a total of $217,137.45 in Emergency Shelter and Street Outreach were disbursed to SORT. The SORT team continued to provide linkage s and referrals to essential services to 433 persons through outreach and engagement services, additionally SORT evolved to provide street -based case management service s to 34 persons through ESG-CV. A total of 8 persons were house d through street outreach coordination and a total of 19 persons successfully enrolled in an emergency shelter program through referrals from SORT.

DRAFT

CAPER 6
OMB Control No: 2506-0117 (exp. 07/31/2015)
Comparison of the proposed versus actual outcomes for each outcome measure submitted with the consolidated plan and explain, if applicable, why progress was not made toward meeting goals and objectives. 91.520(g) Categories, priority levels, funding sources and amounts, outcomes/objectives, goal outcome indicators, units of measure, targets, actual outcomes/outputs, and percentage completed for each of the grantee’s program year goals.

Table 1 - Accomplishments – Program Year & Strategic Plan to Date Goal Category Source / Amount Indicator
Unit of
Measure
Expected –
Strategic
Plan
Actual –
Strategic
Plan
Percent
Complete
Expected –
Program
Year
Actual –
Program
Year
Percent
Complete
Increased
Decent and
Affordable
Housing
Affordable
Housing HOME: $1,713,852
Rental units
constructed
Household
Housing
Unit
25 17 68.00% 5 5 100.00%
Homeowner
Housing
Rehabilitated
Household
Housing
Unit
25 3 8.00% 0 0 NA
Enhanced
Homeless
Facilities and
Services
Homeless
CDBG: $135,800
ESG: $494,021
ESG-CV: $1,667,842
HOME-ARP: $2,480,958
TBRA/Rapid Re-
Housing
Persons
Assisted 50 134 268% 10 53 530%
Public Service
activities other than
Low/Moderate
Income Housing
Benefit
Persons
Assisted 500 300 60% 50 187 374%
Homeless Person
Overnight Shelter
Persons
Assisted 1,300 221 17% 225 0 0.00%
Homelessness
Prevention
Persons
Assisted 25 1 4.00% 5 0 0.00%
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CAPER 7
OMB Control No: 2506-0117 (exp. 07/31/2015)
Goal Category Source / Amount Indicator
Unit of
Measure
Expected –
Strategic
Plan
Actual –
Strategic
Plan
Percent
Complete
Expected –
Program
Year
Actual –
Program
Year
Percent
Complete
Enhanced
Neighborhood
Conditions
Non-
Homeless
Special
Needs
Non-Housing
Community
Development
CDBG: $1,570,872
CDBG-CV: $742,729
Public Facility or
Infrastructure
Activities other than
Low/Moderate
Income Housing
Benefit
Persons
Assisted 100,000 0 0.00% 51,200 0 0.00%
Public Service
activities other than
Low/Moderate
Income Housing
Benefit
Persons
Assisted 4,000 584 14.60% 200 163 81.50%
Businesses Assisted Businesses
Assisted 20 0 0.00% 0 0 0.00%

Assess how the jurisdiction’s use of funds, particularly CDBG, addresses the priorities and specific objectives identified in the plan, giving special attention to the highest priority activities identified.

During FY 2022-23, the City continued to implement the priority needs established in th e City’s current FY 2020-24 Consolidated Plan. All High Priority Needs identified in the Consolidated Plan received funding from CDBG, HOME, and/or ESG programs. The City was able to achieve or remain on track to achieve most of its goals and objectives. Specifically, the City pursued the following affordable housing projects (described in detail earlier):
▪ Parkside Manor Housing Development Project – Phase I: This project is located at 1112 Parkside Street in the City of Salinas. In FY 2021 -22, the developer demolished 48 existing senior housing units and proposed the construction of 80 new senior residential units , along with supporting improved infrastructure and amenities. During FY 202 2-23, the General Contractor completed construction of the project in November 2022. Although the Housing Authority of the County of Monterey held a grand opening on January 19, 2023, tenants were allowed to move in November 2022. ▪ Sun Rose Apartments: This project is an 11-unit transitional/permanent supportive housing facility with supportive services for very low-income individuals with mental health disabilities who are homeless, chronically homeless, or at -risk of homelessness. The address is confidential. This new construction project consists of a three-story building, two patios and eight parking spaces. The development includes seven 1-bedroom units, three studio units and an DRAFT

CAPER 8
OMB Control No: 2506-0117 (exp. 07/31/2015)
8-bedroom transitional unit with shared amenities. Building permits for this Project were approved and issued in June of 2021 and construction is currently underway with an anticipated completion by the summer of 2023. ▪ Catalyst Apartments Rehabilitation Project: The non-profit developer, Interim Inc. began the renovation of the Catalyst Apartments in March of 2021 .

The address for this project is confidential. This affordable rental complex included the rehabilitation of 5 1-bedroom apartment units. Construction was completed in January of 2022. Interim Inc. and City staff collaborated to close-out documents, issue final payment, closed the project in IDIS by June 2023. ▪ Salinas Housing Advancement, Resources & Education Navigation Center (SHARE): In FY 2021-22 and FY 2022-23 ESG funds were used to provide rapid rehousing financial assistance to the SHARE center to quickly and efficiently move persons from emergency shelter into permanent housing. A total of 85 persons have been housed through the use of these funds in the past two fiscal years. The City is surpassing the 5-year rapid rehousing goal. ▪ First United Methodist Church (FUMC) Kitchen Rehabilitation: On March 29, 2019, the FUMC and the City entered into a CDBG Grant Funding Agreement for a project that includes but is not limited to the reconstruction of the existing kitchen facility, lead and asbestos remediation, sewer line repairs, modification of existing bathrooms and ADA improvements. In FY 2022 -23, the City disbursed $326,814.54 and is currently retaining 5% of the funds ($24,743.10) until project completion. Rehabilitation of the facility is expected to be completed no later than December 2023.

DRAFT

CAPER 9
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-10 - Racial and Ethnic composition of families assisted Describe the families assisted (including the racial and ethnic status of families assisted). 91.520(a) CDBG CDBG-CV HOME* ESG ESG-CV
White 159 234 258 94
Black or African American 4 16 27 14
Asian 0 2 4 0
American Indian or American Native 0 2 11 4
Asian and White 0 0 0
Native Hawaiian or Other Pacific
Islander 0
1 1 0
Other 0 17 8 6
Total 163 272 309 118
Hispanic 104 159 222 65
Not Hispanic 59 113 87 53
* No HOME projects were completed in FY 2022-23

Narrative
The City assisted 163 residents/households with public services through the ECHO Fair Housing Services that are available citywide. This table also includes the 272 persons assisted with CDBG -CV funds. However, some of the assisted residents preferred not to answer or didn’t provide an answer for ethnicity, which are not provided in the above table. About 79 percent of those assisted with CDBG were Hispanic.

While the Catalyst Apartments project has been completed. The City is in the process closing out the project and tenant data is not yet available.

In addition to 309 persons assisted with ESG, the table above also includes 118 persons assisted with ESG-CV funds.

Only persons enrolled into the HMIS are included in this table. For additional details on ESG-funded homeless prevention and intervention services, please refer to the SAGE – HMIS database and report.

DRAFT

CAPER 10
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-15 - Resources and Investments 91.520(a)
Identify the resources made available
Source of Funds Source
Resources Made
Available
Amount Expended
During Program Year
CDBG Public $7,974,126 $1,361,220
CDBG-CV Public $784,463 $146,103
HOME Public $2,132,271 $121,982
HOME-ARP Public $2,918,774 $0.00
ESG Public $520,705 $465,992
ESG-CV Public $1,752,704 $1,646,889
Table 2 - Resources Made Available
Narrative
The CDBG allocation for FY 2022-23 was $2,073,339 and the City also received $78,849.69 in Program Income (PI).

The City had an unexpended $ 5,821,937 from previous program ye ars for a total of $ 7,974,125.69 of available resources. Of the $1,361,220.84 expended during FY 2022 -23, $305,347.68 (22.4%) benefitted the Alisal NR SA the rehabilitation of the Hebbron Family Center and Natividad Creek Park.

The City was allocated a total of $2,400,157 in CDBG-CV program funds in FY 2020-21. As of the beginning of FY 2022-23, the City had expended a total of $1,615,694.49 of its allocation. During FY 2022-23, the City expended a total of $146,102.71 on public services and homeless assistance in response to COVID, along with administration of these activities. There is still a total of $638,359.80 remaining to draw until the end of the term in August 2026.

The City’s HOME allocation for FY 2022-23 was $911,007 and received a total of $93,841.39 of PI. The City also had an unexpended amount of $1,127,423 from prior fiscal years, bringing the total amount of HOME funding available to $2,132,271.43 for FY 2022-23. Of the available funds $121,982.28 were expended during this period.

The Allocation Plan (AP) for the HOME American Rescue Plan (ARP) was submitted to HUD for final review and approval in October of 2022. By May 26, 2023, HUD granted its final approval and awarded a total of $ 2,918,774.

There were no expenditures during FY 2022-23.

The City’s ESG allocation for FY 2022-23 was $178,942, however the City had $341,763.33 of unexpended funds from prior years for a total of $520,705.33 of available funds for FY 2022-23. There were $465,991.56 of expenditures during this period.

The City was awarded a total of $6,432,171 in ESG -CV funds through a Substantial Amendment to the FY 2019 -20 AAP, and continued to spend the CV funds over the FY 2022 -23 perio d. From the original award, the City had $1,752,703.69 in available ESG-CV funds at the beginning of FY 2022-23 to continue funding essential services such as Rapid Re -housing, Emergency Shelter, Street Outreach, HMIS, and grant administration for the home less population. By the end of the fiscal year, the City had expended $1,646,889.45 leaving $105,814.24 in funds remaining from this program.

In summary, o f all funds expended during FY 2022 -23 (CDBG, CDBG -CV, ESG, ESG -CV, and HOME , totaling $3,745,427.27), the funds benefitting the target areas include:
• Alisal NRSA - $305,347.68 (CDBG);
• Chinatown Revitalization Area - $348,769.60 (ESG-CV)
DRAFT

CAPER 11
OMB Control No: 2506-0117 (exp. 07/31/2015)

Identify the geographic distribution and location of investments Target Area
Planned
Percentage of
Allocation
Actual
Percentage of
Allocation
Narrative Description
Alisal Neighborhood Revitalization
Strategy Area 0 Two CDBG Public Facilities
Chinatown Revitalization Area 17 One ESG-CV Public Service Activity Table 3 – Identify the geographic distribution and location of investments Narrative
Alisal Neighborhood Revitalization Strategy Area (NRSA) This area represents one of the most distressed neighborhoods in the City. Th is area ha s some of the highest concentrations of poverty and substandard living conditions in the City. The area faces challenges such as inadequate public infrastructure, high levels of unemployment, high levels of poverty, and violent criminal activity. Within the Alisal NRSA, 26.4% of all residents' lives in poverty, a higher proportion than the City overall (17.2 percent).

For the FY 2022-23 Action Plan, no CDBG funds were allocated to activities benefitting the Alisal NRSA . However, during FY 2022-23, the City expended funding from prior years on the rehabilitation of the Hebbron Family Center and Natividad Creek Park, both of which are in the Alisal NRSA. A third project, Early Childhood Development Center, is not located in the Alisal NRSA, yet the project will serve children living in the Alisal NRSA.

Chinatown Area
The 12 blocks that form the Chinatown area are primarily located within Census Tract 18.02 Block Group (BG) 2. This BG has a population of about 2,000, with 78.5 percent being low and moderate income. Large numbers of homeless individuals have been camping in Chinatown over the past decade. The Coalition of Homeless Service Providers has counted 300 people living on the streets within this area at the height of the encampments within this neighborhood.

During FY 2022-23, the City allocated funds to provide s ervices to address the needs of the unsheltered in th is area include ESG-CV funding to Community Homeless Solutions to operat e the Chinatown Navigation Center (CNC) and provide rapid rehousing services that benefit the households Chinatown Area. Along with daily wa lk-in shower and restroom service, hygiene and clothing closet. In addition, through the Salinas Outreach and Response Team (SORT) services such as engagement, linkages and referrals to other services were provided to households living in Chinatown and throughout the City. SORT takes an active role in locating and connecting the unsheltered households to the CNC and SHARE Center to encourage shelter and connect them to housing pathway services.

DRAFT

CAPER 12
OMB Control No: 2506-0117 (exp. 07/31/2015)
In addition to the two above mentioned activities, in FY 2021 -22 AAP, the City had allocated a total of $ 607,980 in CDBG program funds to the Chinatown Neighborhood Improvements project for construction and activity delivery .

However, through a substantial amendment to the FY 2021-22 AAP, the funds for this activity were reallocated to the Hebbron Family Center project. Nevertheless, the funding amounts de-obligated from the Chinatown Neighborhood Improvements project were re-obligated under the City’s FY 2022-23 AAP.

Chinatown Slum and Blight Designation
On May 16, 2019, Kimberly Nash, the Director of the Community Planning and D evelopment Division, accepted the Chinatown Slum and Blight Designation Report. With the designation of Chinatown as a Slum and Blight Area, the City has a greater opportunity to revitalize it. Chinatown is at the heart of Salinas and it’s an integral part of the City’s rich history. This desig nation was effective July 1, 2017 and will continue for a period of 10 years after. The designation covers an area of six-blocks that are physically separated from the surrounding Downtown and the Intermodal Transit Center by the Union Pacific railroad tracks and by the main arterials such as East Market Street, Sherwood Drive, East Rossi Street, Monterey Street and North Main Street. The neighborhood includes the following minor streets: East Lake Street, California Street, Soledad Street, Market Way, Brid ge Street. Within the neighborhood, t here are three (3) alleys: Bridge, Rossi, and Lake.

Leveraging
Explain how federal funds leveraged additional resources (private, state, and local funds), including a description of how matching requirements were satisfied, as well as how any publicly owned land or property located within the jurisdiction that were used to address the needs identified in the plan.

During FY 202 2-23, there were several affordable housing projects which were described in detail earlier . These projects include the Catalyst Apartments, Sun Rose Apartments, and Parkside Manor -Phase I ; and required the layering of multiple funding resources.

The City also received HOME-ARP funds in the amount of $2,918,774. These funds are intended to provide supportive services at two HomeKey sites that are currently under rehabilitation.

For Public Services subrecipients, ESG funding is often an essential source of fund ing that allows access to other funds. None of the subrecipients’ essential safety net programs are funded exclusively by ESG. Local community foundations require matching funding and City of Salinas CDBG funds have frequently fulfilled that requirement.

There are also other more s ubtle forms of leverage. Public investment in a particul ar neighborhood (upgrading water mains or installing traffic signals or street lighting), for example, can be an inducement for additional investment by area property owners affected by the improvements.

In addition, the City is working on establishing several new public/community facilities on City-owned properties:
1081 Buckhorn Drive: The City purchased 1081 Buckhorn Drive with HUD Economic Development Initiatives (EDI) funds with the specific objective to develop a childcare center. This 0.8-acre property is located immediately outside of the Alisal NRSA; it is expected that this childcare center would primarily serve Alisal residents. The City is working with the Alisal Union School District (AUSD) to develop the site for the District’s Early Childhood (Preschool) and Day Care programs. The Alisal Union School District (AUSD) and City completed the Environmental Assessment for the Early Childhood Development Center and obtain ed an Authority to Use Grant Funds (AUGF) in November of 2020. AUSD will submit this project to the California Division of the State Architect (DSA) for review and approval. DSA approval is expected to be accomplish by September 2023. The project is estimated to go out to bid on November 2023, begin construction in January 2024, be completed by January 2025 and placed in operations by May 2025.

HOME Match Contribution: The excess match carried over from the previous program year 2021 is $6,372,712.

There was no match contribution for program year 2022.

DRAFT

CAPER 13
OMB Control No: 2506-0117 (exp. 07/31/2015)
Fiscal Year Summary – HOME Match

1. Excess match from prior Federal fiscal year $6,372,712

2. Match contributed during current Federal fiscal year $0

3. Total match available for current Federal fiscal year (Line 1 plus Line 2) $6,372,712

4. Match liability for current Federal fiscal year $0

5. Excess match carried over to next Federal fiscal year (Line 3 minus Line 4) $6,372,712 Table 4 – Fiscal Year Summary - HOME Match Report
DRAFT

CAPER 14
OMB Control No: 2506-0117 (exp. 07/31/2015)
Match Contribution for the Federal Fiscal Year
Project No. or
Other ID
Date of
Contribution
Cash
(non-Federal
sources)
Foregone
Taxes, Fees,
Charges
Appraised
Land/Real
Property
Required
Infrastructure
Site
Preparation,
Construction
Materials,
Donated labor
Bond
Financing Total Match
N/A
Table 5 – Match Contribution for the Federal Fiscal Year

HOME MBE/WBE report
Program Income – Enter the program amounts for the reporting period Balance on hand at
beginning of reporting
period
Amount received during
reporting period
Total amount expended
during reporting period
Amount expended for
TBRA
Balance on hand at end of
reporting period
$668,868.24 $93,841.39 $33,642.89 $0 $729,066.74
Table 6 – Program Income

DRAFT

CAPER 15
OMB Control No: 2506-0117 (exp. 07/31/2015)
Minority Business Enterprises and Women Business Enterprises – Indicate the number and dollar value of contracts for HOME projects completed during the reporting period Total
Minority Business Enterprises
White Non-
Hispanic
Alaskan
Native or
American
Indian
Asian or
Pacific
Islander
Black Non-
Hispanic Hispanic
Contracts
Number 0 0 0 0
Dollar
Amount 0 0 0 0
Sub-Contracts
Number 0 0 0 0
Dollar
Amount 0 0 0 0
Total
Women
Business
Enterprises Male
Contracts
Number 0 0 0
Dollar
Amount $0.0 $0.0 $0.0
Sub-Contracts
Number 0 0 0
Dollar
Amount $0.0 $0.0 $0.0
Table 7 – Minority Business and Women Business Enterprises

Minority Owners of Rental Property – Indicate the number of HOME assisted rental property owners and the total amount of HOME funds in these rental properties assisted Total
Minority Property Owners
White Non-
Hispanic
Alaskan
Native or
American
Indian
Asian or
Pacific
Islander
Black Non-
Hispanic Hispanic
Number 0 0 0 0 0 0
Dollar
Amount
$0.00 $0.00 $0.00 $0.00 $0.00 $0.00
Table 8 – Minority Owners of Rental Property

DRAFT

CAPER 16
OMB Control No: 2506-0117 (exp. 07/31/2015)
Relocation and Real Property Acquisition – Indicate the number of persons displaced, the cost of relocation payments, the number of parcels acquired, and the cost of acquisition Parcels Acquired 0 $0
Businesses Displaced 0 $0
Nonprofit Organizations Displaced 0 $0
Households Temporarily
Relocated, not Displaced 0 $0
Households
Displaced Total
Minority Property Enterprises
White Non-
Hispanic
Alaskan
Native or
American
Indian
Asian or
Pacific
Islander
Black Non-
Hispanic Hispanic
Number 0 0 0 0 0 0
Cost $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
Table 9 – Relocation and Real Property Acquisition

DRAFT

CAPER 17
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-20 - Affordable Housing 91.520(b)
Evaluation of the jurisdiction's progress in providing affordable housing, including the number and types of families served, the number of extremely low-income, low-income, moderate-income, and middle-income persons served.

One-Year Goal Actual
Number of homeless households to be
provided affordable housing units
0 0
Number of non-homeless households to be
provided affordable housing units
5 6
Number of special-needs households to be
provided affordable housing units
0 0
Total 5 6
Table 10 – Number of Households

One-Year Goal Actual
Number of households supported through
rental assistance
0 0
Number of households supported through
the production of new units
5 0
Number of households supported through
the rehab of existing units
0 5
Number of households supported through
the acquisition of existing units
0 0
Total 5 5
Table 11 – Number of Households Supported

Discuss the difference between goals and outcomes and problems encountered in meeting these goals.

Under the City's Affordable Housing Goal for FY 2022-23, the City proposed to reserve 90 percent of the available HOME funds for an affordable housing project to be determined in the future. Through HOME program funds, the City contributed to the completion a 100% affordable 80 units senior project known as Parkside Manor Phase I, restricting 6 units in the Project as HOME units. Through CDBG program funds, the City contributed to the completion of the five- unit Catalyst Apartments Rehabilitation project which provides housing to persons with mental disabilities. The City also provided CDBG program funds towards the Sun Rose Apartments for the one 8-bedroom transitional unit within this 11-unit development.

DRAFT

CAPER 18
OMB Control No: 2506-0117 (exp. 07/31/2015)
Discuss how these outcomes will impact future annual action plans.

Due to the COVID-19 pandemic, the City has focused much of its attention to addressing the urgent needs associated with COVID-19 response. Housing rehabilitation activities were suspended during FY 2022-23 and program is being evaluated for re-instatement.

Include the number of extremely low-income, low-income, and moderate-income persons served by each activity where information on income by family size is required to determine the eligibility of the activity.

Number of Persons Served CDBG Actual HOME Actual
Extremely Low-income 0 0
Low-income 5 0
Moderate-income 0 0
Total 5 0
Table 12 – Number of Persons Served
Narrative Information
The City utilizes its CDBG and HOME funds to provide affordable housing for the low-income population. For example, Parkside Manor Apartments - Phase I is a housing project that will benefit seniors and was completed in FY 2022-23.

The Sun Rose Apartments project is a hybrid facility consisting of transitional and permanent supportive housing that will benefit persons with mental disabilities and is expected to be completed by the end of 2023 . The Catalyst Apartments Rehabilitation project will also benefit persons with mental disabilities, and was completed in FY 2022-23.

The Housing Services Program (Direct/Deferred Loans) allows homeowners to remain in their homes while making repairs on their deteriorated home. Housing Accessibility Assistance (HAA) Grants also help individuals with disabilities maintain and preserve access to adequate housing. Currently, the program has been suspended because of staffing shortages and no funds were allocated in FY 2022-23.

DRAFT

CAPER 19
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-25 - Homeless and Other Special Needs 91.220(d, e); 91.320(d, e); 91.520(c) Evaluate the jurisdiction’s progress in meeting its specific objectives f or reducing and ending homelessness through:

Reaching out to homeless persons (especially unsheltered persons) and assessing th eir individual needs
The Salinas Outreach and Response Team participates in the planning and facilitation of homeless outreach meetings in partnership with the Coalition of Homeless Service Providers . This includes all the homeless service providers including California State University Monterey Bay (HEA RT), Interim Inc (MCHOME), Junipero Franciscan Workers, Community Human Services (SVSOP), Access Support Network, and Community Homeless Solutions. These meetings were created to improve system processes and coordination of outreach services to address the comp lex needs of the unsheltered regionally. In FY 2022-23, The City of Salinas continued to fund both BACS and The Salinas Outreach and Response Team through ESG. Both programs demonstrating greater numbers of successes as outlined in the ESG narrative.

City of Salinas: The City of Salinas participates in the Chinatown Homeless Action Team (CHAT) with representatives of the Coalition of Homeless Service Providers, Interim Inc., California Sta te University Monterey Bay (CSUMB), Sun Street Centers, Mid -Peninsula Housing Coalition, Housing Resource Center of Monterey County (HRC) and the Franciscan Workers of Junipero Serra. CHAT meets monthly.

The City also meets with the Coalition of Homeless Services Providers by participating in a monthly Administration and Implementation Meeting. The City has also attended bi-monthly meetings with the Community Foundation of Monterey County. Leaders from Monterey County, including City Managers, key City sta ff, non -profit institutions and the Community Foundation have met to try and create solutions to alleviate conditions in Chinatown and provide solutions, including housing and resources.

City staff also participate in the Salinas Downtown Community Board group that meets monthly to create a vision for Chinatown. This group is composed of service providers, City and County staff , and o ther stakeholders in the neighborhood. City staff also attend the Housing Pipeline Committee meetings held by the Coa lition of Homeless Service Providers . The purpose of this group is to aid in understanding the availability of housing resources for homeless residents and to create new solutions to facilitate additional housing supply throughout the County. In addition, City staff particip ates in the Homeless Management Information System (HMIS) Oversight Committee meetings as well as the Homeless Prevention and Rapid Rehousing Program committee (HPRP). T he City’s Mayor also sits on the Leadership Council for the Regional Continuum of Care (CoC).

Addressing the emergency shelter and transitional housing needs of homeless persons Homeless Funding: In 2016 the City became the administrative entity (AE) to administer State ESG and California Emergency Solutions and Housing (CESH) programs for San Benito and Monterey Counties. This collaboration has added emergency homeless funding and increased capacity to serve homeless in our CoC. In FY 2022-23, the City and the County joined efforts to fund the SHARE Center operated by BACS. In addition to the SHARE Center, the City funds the operations of the Chinatown Navigation Center (CNC) using ESG-CV funds, operated by Community Homeless Solutions to provide sanitation and onsite management of services for the homeless indivi duals in Chinatown. In conjunction with these services, the City also purchased, installed, and furnish a Sprung Structure that can temporarily house up to 51 individuals which are also managed and operated by Community Homeless Solutions.

There are two RVs reserved in the scenario that there are COVID positive cases at the CNC. This activity was in response to the COVID-19 pandemic. In FY 2022-23 through other leveraged funds the City and County are partnering to expand the project room key program in Salinas under another similar model, The Emergency Motel Program which offers 37 rooms, 11 with double beds, 26 single beds. University Corporation of Monterey Bay provides case management services at the EMP and are partially funded by ESG-CV.

DRAFT

CAPER 20
OMB Control No: 2506-0117 (exp. 07/31/2015)
Emergency S helter: Community Homeless Solutions (CHS), Bay Area Community Services (BACS) and Victory Mission provide emergency shelters to the homeless population in Salinas.

Helping low-income individuals and families avoid becoming homeless, especially extremely low- income individuals and families and those who are: likely to become homeless after being discharged from publicly funded institutions and systems of care (such as health care facilities, mental health facilities, foster care and other youth facilities , and corrections programs and institutions); and, receiving assistance from public or private agencies that address housing, health, social services, employment, education, or youth needs
Discharge Policies: On May 8, 2007, the City of Salinas adopted a Discharge Coordination Policy pertaining to the discharge of persons from publicly funded institutions and systems of care. As the City neither owns nor operates any such facilities, the impact was largely symbolic. The Countywide Continuum of Care organi zation seeks to coordinate discharge policies among publicly funded institutions a nd systems of care. The “Lead Me Home: The Game Plan for Housing Homeless People in Monterey and San Benito Counties” established the Discharge Planning Committee as well as Action Teams for Foster Youth, Health and Criminal Justice seeing to develop a county-wide discharge planning policy.

Helping homeless persons (especially chronically homeless individuals and families, families with children, veterans and their families, and unaccompanied youth) make the transition to permanent housing and independent living, including shortening the period of time that individuals and families experience homelessness, facilitating access for homeless individuals and families to affordable housing units, and preventing individuals and families who were recently homeless from becoming homeless again
In Salinas, homeless service agencies generally work to get homeless individuals into permanent housing as quickly as possible.

Bay Area Community Services: BACS provided emergency shelter services and rapid re-housing through SHARE Center Operations to 154 persons. Specifically, 132 persons were provided shelter services and 22 persons were assisted with rapid re-housing.

DRAFT

CAPER 21
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-30 - Public Housing 91.220(h); 91.320(j)
Actions taken to address the needs of public housing
The Housing Authority of the County of Monterey (HACM) serves as the housing authority for the County as a whole except the City of Soledad. The City of Salinas does not permanently own, manage, or otherwise control any residential property, including any property that could be categorized as “public housing.” HACM has converted all public housing units countywide to Project -Based Rental Assistance. To-date, the City has completed a total of 27 California Tax Credit Allocation Committee (CTCAC) Local Review Agency (LRA) Project Evaluation Forms for HACM regarding proposed Residential Assistance Demonstration (RAD) proposed projects.

Actions taken to encourage public housing residents to become more involved in management and participate in homeownership
HACM has taken the lead in developing innovative models to enable the h omeless and other low-income families to achieve economic independence and self -sufficiency. Their multi -faceted plan to improve the operation of public housing units and assist clients toward self-sufficiency is detailed in their periodically updated Five Year Action Plan.

Actions taken to provide assistance to troubled PHAs
HACM has not been designated by HUD as “troubled.”
DRAFT

CAPER 22
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-35 - Other Actions 91.220(j)-(k); 91.320(i)-(j)
Actions taken to remove or ameliorate the negative effects of public policies that serve as barriers to affordable housing such as land use controls, tax policies affecting land, zoning ordinances, building codes, fees and charges, growth limitations, and policies affecting the return on residential investment. 91.220 (j); 91.320 (i)
The most critical barrier to affordable housing in Salinas is that the need for decent, affordable housing far exceeds the City's available resources. With the elimination of redevelopment funds, the City's ability to address its affordable housing needs was seriously compromised. In addition, rising housing costs combined with the decrease in the availability of public funds has forced the City to suspend its First -Time Homebuyer Program. The City continues to aggressively pursue funding available at the local, state, and federal levels to supplement its limited funds.

The City values its partnership with nonprofit housing developers such as CHISPA, MidPen, and MCHADC in pursuing innovative strategies to address the City ’s affordable housing needs and providing more permanent housing options for the homeless.

Another method the City has utilized to assist developers is providing fee deferrals for certain eligible impact fees. The City typically structures the fee deferral as a low -interest loan o ver a fifty-five-year period to be paid by the residual receipts.

The City also updated its Inclusionary Housing Ordinance in June 2017 to add more flexible options for developers to produce affordable units on-site. Projects that are 100% affordable are exempt under the updated Inclusionary Housing Ordinance.

The City also has a Density Bonus Ordinance which provides incentives and concessions to developers who propose a certain percentage of affordable housing in their developments. The City continues to adjust to the new Density Bonus laws put into effect by the State of California.

The City’s Zoning Ordinance has been updated to allow more flexibility for auxiliary (accessory) dwelling units to be constructed.

The City is updating its Housing Element for the 2023-2031 planning period. This update will establish the City housing programs and activities for the next eight years to facilitate the development and preserv ation of housing. The Draft Housing Element includes a number of actions to mitigate constraints to housing development, including Zoning Code amendments to facilitate the development of housing for special needs populations.

Actions taken to address obstacles to meeting underserved needs. 91.220(k); 91.320(j) The homeless are among the most underserved group in Salinas, with ESG funding at a level far below what is needed to address the City's homeless issues . In response, the City has used its CDBG alloc ation to provide public facilities and services that can benefit this group. In FY 202 2-23, the City also used its remaining allocation of ESG -CV and some CDBG-CV funds to help finance services and projects that served this underrepresented group.

In addition, the City has been working with the Counties of Monterey and San Benito Continuum of Care to implement homeless programs and services using State ESG funds. The City serve s as the lead agency for adminis tering the State ESG program. These funds are used for homeless prevention services, emergency shelter services, rapid rehousing, and outreach.

The following agencies were approved for funding with the FY 2022-23 State ESG funds:
• City of Salinas – Program Administration and The Salinas Outreach and Response Team • Community Homeless Solutions – Domestic Violence Emergency Shelter • Central Coast Center for Independent Living – Emergency Shelter and Rapid Rehousing services Actions taken to reduce lead-based paint hazards. 91.220(k); 91.320(j) DRAFT

CAPER 23
OMB Control No: 2506-0117 (exp. 07/31/2015)
As a condition required to receive HUD funds, the City of Salinas complies with HUD's Lead Safe Housing Regulation (Title 24, Part 35). Potential project sites with housing units constructed prior to 1978 are tested by a c ertified lead inspection firm (for lead paint and, where applicable, for other possible materials containing lead, such as ceramic tiles). When found, lead remediation is performed by certified LBP contractor before the General Contractor is permit to begin other construction activities.

In FY 2022-23, there were three (3) housing/transitional housing projects and one (1) public facility under construction.

Of the 3 housing/transitional housing projects, two (2) were built before 1978 (Parkside Manor-Phase I and Sun Street Apartment (formerly known as Soledad House)) and one (1) was built after 1978 (C atalyst Apartments). Parkside Manor - Phase I is a per manent housing project and all of the building that contain lead and a sbestos containing materials were properly disposed during the demolition of the structures. Similarly, and as part of the Sun Stree t Apartments, a transitional/permanent supportive housing project, that involved the demolition of Soledad House. This original structure contained lead and asbestos containing materials. During the demolition phase of the project, all lead and asbestos were properly disposed by certified LBP contractor s. Regarding the one (1) public facility under construction in FY 2022-23, the First United Methodist Church Kitchen Rehabilitation, the facility was constructed prior to 1978. The lead and asbestos remediation for this facility happened in FY 2021-22.

The Parkside Manor- Phase I projected involved the demolition of 48 existing units with lead-based paint abatement at 1112 Parkside Street. These units were replaced with 80 new senior residential units. Construction of the project was completed in November 2022 and tenants began moving in subsequently.

Sun Street Apartments involved the demolition of an 8 -bedroom house containing lead and asbestos containing materials at a confidential address . The original house will be replaced by an 11-unit apartment complex. Nine units will be permanent supportive housing and one unit will be transitional housing. The City assisted with funding to help support the construction of the transitional housing unit in this complex. This project is very close to being completed and it is expected that tenants will begin to move in the 1st or 2nd quarter of FY 2023-24.

Actions taken to reduce the number of poverty-level families. 91.220(k); 91.320(j) The City’s anti-poverty strategy is enumerated below, with specific FY 2022-23 actions noted within each category:

1. Continue to support the efforts of housing developers providing affordable housing opportunities in Salinas, particularly rental and multi-family housing. The City currently has four (4) projects that are under construction.

One project will provide permanent/transitional housing and the remaining three will provide permanent and permanent supportive housing to low-income households and homeless individuals.

2. In FY 2022-23, the Housing Services Program, which provided Housing Rehabilitation Loan s, Housing Accessibility Assistance (HAA) Grants, and Lead Based Paint (LBP) Grants was suspended and is currently being re-evaluated.

3. Continue to support fair housing services to enable seniors to remain in their own homes, and to addresses basic needs.

4. Continue to support homeless service providers in Salinas and the larger community. Bay Area Community Services served 132 persons and the City’s Salinas Outreach and Response Team served 187 persons.

5. The Hebbron Family Center (HFC) will offer a safe, fun, and positive environment where youth would be able to participate in a variety of enrichment activities in a recreational setting. HFC will offer a Youth Homework Center, Drop-in After School program, Summer Program, Girl Scout Troop 541, Karate Classes, Read Grow Play, Citizenship Classes, Food Bank and a variety of other recreation programs. The HFC was demolished and the new HFC is currently under schematic design.

6. Continue to promote Section 3 Employment and Economic Opportunities for low-income residents and business concerns through the City’s various housing programs and public improvement projects. Section 3 Clause is included in all bid package for public works projects as well as all affordable housing projects funded with federal funds. Section 3 information is collected annually and reported back to HUD. The City transitioned DRAFT

CAPER 24
OMB Control No: 2506-0117 (exp. 07/31/2015)
into the new HUD Section 3 Rule . City will work with developer s and consultants to comply with the new Section 3 Rule.

Actions taken to develop institutional structure. 91.220(k); 91.320(j) The City will continue to pursue other sources of fund s to leverage HUD funding and entice housing developers to create affordable housing developments within the City. The City is in the process of engaging local affordable housing developers and learn the future housing development plans and offer existing and future sources of funds from the State of California and HUD.

The City is committed to continue funding the SHARE Center, CNC and SORT using HUD, State and local funds, to alleviate homelessness using HUD, state and local funds.

The City has also established a Housing and Land Use Committee to oversee the use of HUD funds. Th is committee provides an additional forum for nonprofits and stakeholders to communicate with the City and community members regarding housing and community development needs and plans for future projects. The committee is tasked with the objective of enhancing coordination and improving the effectiveness and efficiency in using HUD funds. Specifically, the committee evaluated the planned projects and fun ding, with input from the service prov iders and stakeholders, made changes to the criteria for allocating funds, and established a minimum grant amount for each agency before final awards are approved by City Council through the approval of the City’s Annual Action Plan.

The City utilizes City Data Services for efficient and accurate management of the grant funds.

Actions taken to enhance coordination between public and private housing and social service agencies. 91.220(k); 91.320(j)
The City of Salinas partners with its strong network of public and private housing and social service agencies to provide housing and community development programs in the City. Coordination efforts are ongoing. In addition, the City is working with the Co unties of Monterey and San Benito Continuum of Care to implement homeless programs and services using State ESG and CESH funds. This funding source available to the region allow s the City to provide an increased level of services for the homeless and at-risk homeless. The City serves as the lead agency for this funding program. The City is also in constant contact and collaboration with the Housing Authority of the County of Monterey (HACM) in the development of affordable housing projects and the provision of housing vouchers for projects funded with federal, state and local funds.

Identify actions taken to overcome the effects of any impediments identified in the jurisdiction’s analysis of impediments to fair housing choice. 91.520(a) The City is in the process of updating the Housing Element of the General Plan for the 2023 -2031 planning period. A major focus of this update is the new State requirement to affirmatively further fair housing. The Draft Housing Element contains a range of meaningful actions to address five fair housing themes, including:
• Fair housing outreach and enforcement
o Target outreach to areas with concentrations of racial/ethnic minority populations and concentrations of renter-households
o Target code enforcement activities in Alisal NRSA where substandard housing units are more common
• Housing mobility
o Proactively pursue and leverage governmental and non-governmental funds to increase the inventory of affordable housing
o Pursue PIP funding and maintain the Prohousing Designation o Amend the Zoning Code to facilitate the development of affordable housing and a variety of housing types, including emergency shelters, supportive housing, low barrier navigation centers, etc.

DRAFT

CAPER 25
OMB Control No: 2506-0117 (exp. 07/31/2015)
• New opportunities in high resource areas
o Acquire and assemble sites to develop affordable housing particularly in high opportunity areas o Promote the establishment of Affordable Housing Overlay Zones in ‘High Opportunity Areas’ that include a bundle of effective and flexible incentives to encourage developers to build affordable housing
o Facilitate ADU/JADU construction through promotion on the City website, subsidies for owners providing affordable ADUs, and extension of elimination of development impact fees for ADU s between 800-1,200 sq. ft.
o Implement the Family Homeless Challenge Grant by purchasing single family homes and construction of ADUs for unhoused families
• Place-based strategies for neighborhood improvement
o Explore the creation of a Community Revitalization Investment Authority for Downtown, Chinatown, and Alisal
o Develop and adopt the East Area Specific Plan
o Reassess and reinstate the Housing Services Program
o Increase pu blic services through the establishment of a CBDO focused on youth services, fair housing services and tenant/landlord counseling, and/or small business counseling, education, and technical assistance services
• Tenant protection and anti-displacement
o Adopted a Residential Rental Registration Ordinance which will allow the City to broaden the tenant- landlord services
o Explore development of rent stabilization ordinance, tenant relocation assistance ordinance, and just cause for eviction ordinance
o Reassess and reinstate the First Time Homebuyer Program The Draft Housing Element is expected to be adopted by the end of 2023 and implementation of some of these activities are already underway.

DRAFT

CAPER 26
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-40 - Monitoring 91.220 and 91.230
Describe the standards and procedures used to monitor activities carried out in furtherance of the plan and used to ensure long-term compliance with requirements of the programs involved, including minority business outreach and the comprehensive planning requirements During FY 2022-23, the City performed a desk review monitoring of all CDBG, ESG, and HOME subrecipients through its on-line grant management system, City Data Services (CDS) . Due to COVID-19, the City is conducting virtual monitoring's of programs and case files of its subrecipients.

The City’s monitoring procedures for the implementation of its CDBG, HOME, and ES G programs are summarized in Attachment B.

Citizen Participation Plan 91.105(d); 91.115(d)
Describe the efforts to provide citizens with reasonable notice and an opportunity to comment on performance reports.

Citizen participation is one of the most important components of the Consolidated Plan (CP) process.

Publicity: Bilingual (Spanish-English) public notices for a public hearing were released in The Monterey County Herald to inform the public that a draft CAPER was available for review and public comment. The public notices were also posted at the City’s website, the City’s Libraries, City Hal l, City Council Chambers and Community Development Department; and were distributed to the City’s NOFA distribution list.

Public Review of Draft Documents: The City conducted a minimum of 15-day public review period from August 26, 2023, through September 12, 2023. The Draft CAPER was made available at the following locations:
• the City website: https://www.cityofsalinas.org/Residents/Community/Housing-Community-Development • in-person at the Community Development Department, City Clerk’s office at City Hall, John Steinbeck Library, Cesar Chavez Library, and El Gabilan Library
• and through mail when requested.

The Consolidated Plan, amendments, annual Action Plans, and performance reports will be available for five years at Salinas Community Development Department.

DRAFT

CAPER 27
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-45 - CDBG 91.520(c)
Specify the nature of, and reasons for, any changes in the jurisdiction’s program objectives and indications of how the jurisdiction would change its programs as a result of its experiences.

The City received a State grant award of $8.1 million for the reconstruction of the Hebbron Family Center. To initiate the process, Library and Community Services and Public Works Departments identi fied a consultant to assist with construction and program manag ement in an amount just under $1.3 million. The departments requested CDBG funding to offset these pre -development costs. The request was reviewed in consultation with HUD and deemed the project as an eligible activity to receive CDBG funds as it is located within the City’s Alisal Neighborhood Revitalization Strategy Area and satisfies the National Objective of benefiting a Low Mod Area where 51% of the residents fall within the low- and moderate-income categories.

On May 24, 2022, the City amended its FY 2020-21 and FY 2021-22 Action Plans to allocate funding to a new project, the Hebbron Family Center. The amendment consisted in reallocating $798,633 from the Sherwood Recreation Center Phase IV project previously allocated through the FY 2020 -21 AAP a nd $ 607,980 from Chinatown Neighborhood Improvements project allocated in the FY 2021 -22 AAP. However, the condition for this amendment was that the funding for these projects would be reallocated in the FY 2022-23 AAP.

At the end City Council approved the reallocation of up to $1,4406,613 of CDBG funds to the Hebbron Family Center project through its substantial amendment. In recognition of the reprioritization of CDBG funding to support the Hebbron Family Center project and the importance of completing both the Sherwood Recreation Center Phase IV and Chinatown Improvements projects, the City restored the prior funding to each of these projects through the FY 2022 -23 AAP allocation process.
[BEDI grantees] Describe accomplishments and program outcomes during the last year.

Not applicable.

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CAPER 28
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-50 - HOME 91.520(d)
Include the results of on-site inspections of affordable rental housing assisted under the program to determine compliance with housing codes and other applicable regulations Please list those projects that should have been inspected on -site this program year based upon the schedule in §92.504(d). Indicate which of these were inspected and a summary of issues that were detected during the inspection.

For those that were not inspected, please indicate the reason and how you will remedy the situation.

The following list below represents all of the City's HOME-assisted affordable multi-family rental housing projects and shows the total number of HOME assisted units in each project:
• California House (436 California Street) – 5 units
• Foster Care Housing (7 Spoleto Circle) - 1 unit
• Gateway Apartments (25 Lincoln Avenue) – 20 units
• Haciendas Phase I (233 Calle Cebu) – 4 units
• Haciendas Phase II (241 Calle Cebú) – 4 units
• Haciendas Phase III (Hikari) – 9 units
• Haciendas Phase IV (34 E. Rossi Street) – 3 units
• Jardines Del Monte (1253 Del Monte Avenue) – 5 units
• La Gloria Apartments (539 E. Market Street) – 10 units • Los Padres Apartments (1260 John Street) - 5 units
• Lupine Gardens (300 Casentini Street) – 20 units
• Parkside Manor Phase I (1112 Parkside Street) - 6 units • Sherwood Village (808 N. Main Street) – 43 units
• Soledad House (439 Soledad Street) – 8 units
• Tresor Apartments (1041 Buckhorn Drive) – 8 units
• Tynan Village (323 Front Street) – 41 units
• Wesley Oaks (138 Carr Avenue) – 6 units
• Moon Gate Plaza – 12 Units
Due to COVID-19, City staff was not able t o complete any on -site inspection of affordable units in FY 2022-23. The City will resume with the onsite inspections of all projects with HOME units in FY 2023-24.

In a typical year, City staff will conduct an on-site HOME site visit which includes an internal unit inspection fo r each HOME-assisted unit, common area inspection and external property inspection. City staff uses a HOME checklist to cross reference the property conditions.

For the years that a HOME onsite inspection is not required and in accordance with the HOME final rule and §92.504(d), the City uses its customized online grant management software system (City Data Services), which allows all property owners/managers to annually submit unit i nspection reports and data as part of the City’s Annual Compliance Monitoring. The desk monitoring review consist s of developer property unit inspection reports, annual income recertification reports, insurance documentation in which the developer submits annually to the City through CDS. City staff has established a HOME spreadsheet which informs staff when the inspections are due on each of the properties and will continue to use this spreadsheet.

In accordance with the HOME final rule and §92.504(d), the City will ensure that o n-site inspections will occur within 12 months after project completion and at least once every 3 years thereafter during the period of affordability. In addition, the property owner/manager must annually certify to the City that each building and all HOME-assisted units in the project are suitable fo r occupancy, considering State and local health, safety, and other applicable codes, ordinances, and requirements, and the ongoing property standards established by the City to meet the requirements of §92.251. The City will ensure that inspections will be based on a statistically valid sample of units appropriate for the size of the HOME-assisted project, as set forth by HUD.

DRAFT

CAPER 29
OMB Control No: 2506-0117 (exp. 07/31/2015)
Provide an assessment of the jurisdiction's affirmative marketing actions for HOME units. 92.351(b) There are three components to the City’s “affirmative marketing” of activities funded by the HUD entitlement grants: 1) Outreach regarding program design and administration; 2) Marketing of programs operated by the City; and 3) Marketing of activities operated by sub-recipients and sub-grantees.

Language barriers can be an impediment to accessing housing of choice. Reflective of the demographics in the City,

68.5 percent of all Salinas residents spoke languages other than English at home, according to the American Community Survey (ACS). Over half of these residents spoke English “less than very well.” Linguistic isolation is more severe among Hispanics than among Asians, with approximately 64 percent of Salinas residents speaking “Spanish or Spanish Creole 1” at home compared to only 3.8 percent speaking “Asian and Pacific Islander languages.” Among “Spanish or Spanish Creole” speaking households approximately 58.3 percent spoke English “less than very well”.

The City’s Citizen Participation Plan (CPP) includes guidelines for Limited English Proficiency (LEP).

The City also had hard copies and electronic brochures (English and Spanish) for the Housing Services Program when it was available.

Outreach Regarding Program Design and Administration: In keeping with the updated CPP, notices for Action Plan, CAPER, and community development needs hearings and annual Request for Proposals are typically published in Spanish and English in the local newspapers, City’s websites, libraries, City Hall and Community Development Department. The City also subscribes to the California Relay Service to accommodate TDD (telecommunication devices for the deaf) users; published public notices provide a TDD number. The City also provides notice to local agencies that serve groups that may need notice in a different format. Spanish/English translation is typically made available during City Council meetings and at every public hearing regarding Action Plans and oth er HUD-funded topics.

Marketing of Programs Operated by City: The City’s HUD -funded activities are administered by the Housing and Community Development Division of the Community Development Department. Of the current full-time positions allocated to the Division, at least three are certified by the City as bilingual English/Spanish, including the first point of contact for telephone and walk -in inquiries. Promotional materials are produced in both English and Spanish as well as marketing when published in newspapers. From time to time, targeted outreach for housing rehabilitation and first- time homebuyer activities is focused upon Spanish -speaking residents, including information to bilingual realtors and mortgage loan packagers, and Spanish language Public Service Announcements to the local news media.

Marketing of Programs Operated by Subrecipients: All City funding agreements employing funds from HUD grants require affirmative marketing activities. The City’s monitoring plan i ncludes verification that affirmative marketing is being employed. Many of the funded non -profit agencies routinely provide their services in a bilingual format. City housing activities that are not HUD -funded (e.g., inclusionary housing and density bonus programs) routinely require affirmative marketing to the community.

Refer to IDIS reports to describe the amount and use of program income for projects, including the number of projects and owner and tenant characteristics The City received $93,841.39 in HOME program income. Program income has primarily been used to augment funding for the City’s multi-family housing projects underway.

Describe other actions taken to foster and maintain affordable housing. 91.220(k) (STATES ONLY:

Including the coordination of LIHTC with the development of affordable housing). 91.320(j)

1 American Community Survey offers the following sub-categories for members of the population that “Speak a language other than English”:
“Spanish or Spanish Creole”; “Other Indo-European languages”; “Asian or Pacific Island languages”; and “Other languages” DRAFT

CAPER 30
OMB Control No: 2506-0117 (exp. 07/31/2015)
In addition to using HOME funds for the creation of affordable housing units, the City also has an Inclusionary Housing Ordinance that requires a specific percentage of affordable units be included in new housing developments. The City updated this Ordinance in 2017 to improve its effectiveness in fostering affordable housing.

The City also has a Density Bonus Ordinance that developers can utilize, in which the developer would provide a certain percentage of affordable housing in exchange for a greater density of market-rate units allowed in a project.

City staff assists with the completion of the California Tax Credit Allocation Committee (CTCAC) Local Review Agency (LRA) Evaluation Forms for each proposed project that applies for CTCAC funding within the jurisdiction.

DRAFT

CAPER 31
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-58 – Section 3
Identify the number of individuals assisted and the types of assistance provided During FY 202 2-23, the City’s expended funds primarily on public and h omeless services, as well as program administration. These programs are not subject to Section 3 requirements. Projects subject to Section 3 requirements include:
▪ Hebbron Family Center
▪ Sherwood Recreation Center
▪ Chinatown Neighborhood Improvements
▪ First United Methodist Church
▪ Buckhorn Early Childhood Development Center
▪ Catalyst Apartments Rehabilitation
▪ Sun Rose Apartments
▪ Natividad Creek Park Restroom Rehabilitation
▪ Parkside Manor Phase I

Total Labor Hours CDBG HOME ESG HOPWA HTF
Total Number of Activities 0 0 0 0 0
Total Labor Hours
Total Section 3 Worker Hours
Total Targeted Section 3 Worker Hours
Table 13 – Total Labor Hours

Qualitative Efforts - Number of Activities by Program CDBG HOME ESG HOPWA HTF Outreach efforts to generate job applicants who are Public Housing Targeted Workers
Outreach efforts to generate job applicants who are Other Funding Targeted Workers.

Direct, on-the job training (including apprenticeships).

Indirect training such as arranging for, contracting for, or paying tuition for, off-site training.

Technical assistance to help Section 3 workers compete for jobs (e.g., resume assistance, coaching).

Outreach efforts to identify and secure bids from Section 3 business concerns.

Technical assistance to help Section 3 business concerns understand and bid on contracts.

Division of contracts into smaller jobs to facilitate participation by Section 3 business concerns.

Provided or connected residents with assistance in seeking employment including: drafting resumes, preparing for interviews, finding job opportunities, connecting residents to job placement services.

DRAFT

CAPER 32
OMB Control No: 2506-0117 (exp. 07/31/2015)
Held one or more job fairs.

Provided or connected residents with supportive services that can provide direct services or referrals.

Provided or connected residents with supportive services that provide one or more of the following: work readiness health screenings, interview clothing, uniforms, test fees, transportation.

Assisted residents with finding childcare.

Assisted residents to apply for, or attend community college or a four year educational institution.

Assisted residents to apply for, or attend vocational/technical training.

Assisted residents to obtain financial literacy training and/or coaching.

Bonding assistance, guaranties, or other efforts to support viable bids from Section 3 business concerns.

Provided or connected residents with training on computer use or online technologies.

Promoting the use of a business registry designed to create opportunities for disadvantaged and small businesses.

Outreach, engagement, or referrals with the state one-stop system, as designed in Section 121(e)(2) of the Workforce Innovation and Opportunity Act.

Other.

Table 14 – Qualitative Efforts - Number of Activities by Program

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CAPER 33
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-60 - ESG 91.520(g) (ESG Recipients only)
ESG Supplement to the CAPER in e-snaps
For Paperwork Reduction Act

1. Recipient Information—All Recipients Complete
Basic Grant Information
Recipient Name SALINAS
Organizational DUNS Number 010919447
EIN/TIN Number 946000412
Identify the Field Office San Francisco
Identify CoC(s) in which the recipient or
subrecipient(s) will provide ESG assistance
Monterey County

ESG Contact Name
Prefix Mr.

First Name Rod
Middle Name
Last Name Powell
Suffix
Title Assistance Director

ESG Contact Address
Street Address 1 200 Lincoln Ave
Street Address 2
City Salinas
State CA
ZIP Code 93901-
Phone Number (831)758-7487
Extension
Fax Number
Email Address [email protected]

DRAFT

CAPER 34
OMB Control No: 2506-0117 (exp. 07/31/2015)
ESG Secondary Contact
Prefix Mr.

First Name Francisco
Last Name Brambilla
Suffix
Title Management Analyst (Acting Planning Manager)
Phone Number (831) 758-7334
Extension
Email Address [email protected]

2. Reporting Period—All Recipients Complete
Program Year Start Date 07/01/2022
Program Year End Date 06/30/2023

3a. Subrecipient Form – Complete one form for each subrecipient Subrecipient or Contractor Name Bay Area Community Services City Oakland
State CA
Zip Code 94609
UEI 73931628
Is subrecipient a victim services provider No
Subrecipient Organization Type Other Non-Profit Organization ESG Subgrant or Contract Award Amount $86,521

DRAFT

CAPER 35
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-65 - Persons Assisted
Reporting for ESG funding is now completed in a separate system SAGE.

4. Persons Served
4a. Complete for Homelessness Prevention Activities
Number of Persons in
Households Total
Adults 0
Children 0
Don’t Know/Refused/Other 0
Missing Information 0
Total 0
Table 15 – Household Information for Homeless Prevention Activities

4b. Complete for Rapid Re-Housing Activities
Number of Persons in
Households Total
Adults 0
Children 0
Don’t Know/Refused/Other 0
Missing Information 0
Total 0
Table 16 – Household Information for Rapid Re-Housing Activities

4c. Complete for Shelter
Number of Persons in
Households Total
Adults 0
Children 0
Don’t Know/Refused/Other 0
Missing Information 0
Total 0
Table 17 – Shelter Information
DRAFT

CAPER 36
OMB Control No: 2506-0117 (exp. 07/31/2015)

4d. Street Outreach
Number of Persons in
Households Total
Adults 0
Children 0
Don’t Know/Refused/Other 0
Missing Information 0
Total 0
Table 18 – Household Information for Street Outreach

4e. Totals for all Persons Served with ESG
Number of Persons in
Households Total
Adults 0
Children 0
Don’t Know/Refused/Other 0
Missing Information 0
Total 0
Table 19 – Household Information for Persons Served with ESG

5. Gender—Complete for All Activities
Total
Male 0
Female 0
Transgender 0
Don't Know/Refused/Other 0
Missing Information 0
Total 0
Table 20 – Gender Information

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CAPER 37
OMB Control No: 2506-0117 (exp. 07/31/2015)

6. Age—Complete for All Activities
Total
Under 18 0
18-24 0
25 and over 0
Don’t Know/Refused/Other 0
Missing Information 0
Total 0
Table 21 – Age Information

7. Special Populations Served—Complete for All Activities Number of Persons in Households
Subpopulation Total
Total
Persons
Served –
Prevention
Total Persons
Served – RRH
Total
Persons
Served in
Emergency
Shelters
Veterans 0 0 0 0
Victims of
Domestic
Violence
0 0 0 0
Elderly 0 0 0 0
HIV/AIDS 0 0 0 0
Chronically
Homeless 0 0 0 0
Persons with Disabilities:

Severely Mentally Ill 0 0 0 0
Chronic
Substance Abuse 0 0 0 0
Other Disability 0 0 0 0
Total (unduplicated if
possible) 0 0 0 0
Table 22 – Special Population Served

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CAPER 38
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-70 – ESG 91.520(g) - Assistance Provided and Outcomes

8. Shelter Utilization
Number of New Units – Rehabbed 0
Number of New Units – Conversion 0
Total Number of bed - nights available 0
Total Number of bed - nights provided 0
Capacity Utilization 0
Table 23 – Shelter Capacity

9. Project Outcomes Data measured under the performance standards developed in consultation with the CoC(s)
The City ’s ESG program is designed to complement the Monterey County Continuum of Care system, focusing on homeless prevention, rapid re-housing, and providing emergency shelters and essential services.

To further enhance the City’s ability to meeting the outcome and performance goals in the Continuum of Care Strategy, the City is taking the lead in the implementation of State ESG funds.

DRAFT

CAPER 39
OMB Control No: 2506-0117 (exp. 07/31/2015)
CR-75 – Expenditures

11. Expenditures
11a. ESG Expenditures for Homelessness Prevention
Dollar Amount of Expenditures in Program Year
2019 2020 2021
Expenditures for Rental Assistance 0 0 0
Expenditures for Housing Relocation and
Stabilization Services - Financial Assistance 0 0 0
Expenditures for Housing Relocation & Stabilization
Services - Services 0 0 0
Expenditures for Homeless Prevention under
Emergency Shelter Grants Program 0 0 0
Subtotal Homelessness Prevention 0 0 0
Table 24 – ESG Expenditures for Homelessness Prevention

11b. ESG Expenditures for Rapid Re-Housing
Dollar Amount of Expenditures in Program Year
2019 2020 2021
Expenditures for Rental Assistance 0 0 0
Expenditures for Housing Relocation and
Stabilization Services - Financial Assistance 0 0 0
Expenditures for Housing Relocation & Stabilization
Services - Services 0 0 0
Expenditures for Homeless Assistance under
Emergency Shelter Grants Program 0 0 0
Subtotal Rapid Re-Housing 0 0 0
Table 25 – ESG Expenditures for Rapid Re-Housing

11c. ESG Expenditures for Emergency Shelter
Dollar Amount of Expenditures in Program Year
2019 2020 2021
Essential Services 0 0 0
Operations 0 0 0
Renovation 0 0 0
Major Rehab 0 0 0
Conversion 0 0 0
Subtotal 0 0 0
Table 26 – ESG Expenditures for Emergency Shelter
DRAFT

CAPER 40
OMB Control No: 2506-0117 (exp. 07/31/2015)

11d. Other Grant Expenditures
Dollar Amount of Expenditures in Program Year
2019 2020 2021
Street Outreach 0 0 0
HMIS 0 0 0
Administration 0 0 0
Subtotal 0 0 0
Table 27 - Other Grant Expenditures

11e. Total ESG Grant Funds
Total ESG Funds Expended 2019 2020 2021
0 0 0
Table 28 - Total ESG Funds Expended

11f. Match Source
2019 2020 2021
Other Non-ESG HUD Funds 0 0 0
Other Federal Funds 0 0 0
State Government 0 0 0
Local Government 0 0 0
Private Funds 0 0 0
Other 0 0 0
Fees 0 0 0
Program Income 0 0 0
Total Match Amount 0 0 0
Table 29 - Other Funds Expended on Eligible ESG Activities

11g. Total
Total Amount of Funds
Expended on ESG
Activities
2019 2020 2021
0 0 0
Table 30 - Total Amount of Funds Expended on ESG Activities

DRAFT

CAPER A-1
OMB Control No: 2506-0117 (exp. 07/31/2015)
Attachment A: Public Participation
Public Hearing and Summary of Comments

Public Hearing- September 12, 2023, at 4:00PM
To be provided

Written Comments

DRAFT

CAPER B-1
OMB Control No: 2506-0117
Attachment B: Monitoring Procedures

The City Housing Division maintains accurate records, both program and financial, pertaining to community development activities, including housing and emergency shelter grant activities. Emergency Solutions Grant (ESG) and CDBG-funded public service activ ities are monitored continuously. Documentation, including activity reports, is required to be submitted with all payment requests. All loan servicing functions (pay -offs, partial payments, subordinations, annual affidavits, etc.) of outstanding loans in t he City loan portfolio are also handled in -house using City Data Services (CDS) interactive computer software system. The City utilizes CDS for loan servicing and monitoring functions for activity reports (monthly, quarterly, annually), invoices, inspections, progress payments, loan payoffs and audit confirmations.

The City’s Labor Compliance Officer through the Public Works Department as well consultants oversee compliance with federal labor standards requirements (e.g., Davis-Bacon) for all Capital Improvement Projects (CIPs) assisted with CDBG funds. Further staff oversees compliance with all federal labor standards requirements on a project -by-project basis for all other CDBG - and HOME -assisted projects, beginning with contract drafting and pre -construction conferences and proceeding through the necessary contractor submittals to project close -out. In limited instances, qualified subrecipients (e.g., HACM and CHISPA) have the resources to oversee federal labor standards with their own staff or enter into a service contract with a Labor Compliance Consulting entity to oversee all federal labor compliance responsibilities. The P ublic Woks Compliance Officer attends labor compliance training when available through the State or Federal agencies to stay abreast of any regulatory changes.

The City continues to implement its formal process of executing a Memorandum of Record (MOR) with other City Departments upon allocation of CDBG funds for Capital Improvement Projects (CIPs). The MOR continues to serve as an a lternate method to a Funding Agreement for ensuring program compliance for federally assisted capital improvement projects. Since implementation of the MOR process, compliance issues have declined, and successful compliance has increased. The Community Development Department, and Housing Division staff, requires that Public Works and other departments that were allocated CDBG funds report in City Data Services (CDS) . The City reviews and monitors regularly and ensures compliance through monthly and quarterly desk reviews and attends construction meetings throughout the duration of the project.

The City has also implemented various steps to further ensure compliance by all CIPs with applicable CDBG program regulations. The MOR was enhanced to include additional language pertaining to submittal of reports on a timely manner. This will assist with early detection of critical project impediments with potential to impact the annual CDBG Timeliness Ratio criteria and will allow for implementation of effective remediation steps. Further language was added to the MOR regarding compliance with 24 CFR Part 570.505 applicable to real property within the City’s control which was acquired or improved in whole or in part using CDBG funds in excess of $25,000 and Change of Use Requirements for all Public Facilities & Improvements eligible under §570.201(c). A key focus during assessments is compliance with the adopted Consolidated Plan and the City's Housing Element, plus support to the City Council’s Goals. Informat ion gathered is employed to evaluate progress towards established goals; to confirm compliance with statutory and regulatory requirements of governing federal legislation (e.g., National Affordable Housing Act); to determine possible revisions to City poli cy and pro cedure, including the Consolidated Plan and Housing Element; and, to prepare performance reports such as this document.

Monitoring Consolidated Plan and HUD Program Compliance: The primary action in this regard occurs during the review of propos als received as a result of the annual funding RFP. Proposals are evaluated and compared based upon the policies and priorities in place and then City staff’s allocation recommendations are based upon the results of this analysis. Any proposed amendments to the Action Plan during the program year are also evaluated on this basis.

In each case, the various timeliness rules, with respect to commitment and expenditure of funds, are also considered.

All funding agreements contain deadlines governing timely use of funds; Salinas has a long-standing record of meeting CDBG, HOME, and ESG commitment and drawdown standards. Subrecipient funding agreements require compliance with not only the relevant federal regulations and OMB guidance, but are drafted to ensure tha t funded activities are carried out as contemplated in the Action Plan. Division staff continues to closely monitor the performance of other City DRAFT

CAPER B-2
OMB Control No: 2506-0117
departments whenever they receive allocations of the federal funds in question through the implementation of t he Memorandum of Record (MOR) used for program and reporting compliance of CDBG assisted projects.

Compliance with Housing Standards: Compliance with housing standards is ongoing. Division staff schedules visits to assisted housing sites following complet ion of con struction or rehabilitation. Recipients of deferred payment rehabilitation loans are evaluated every five years to determine feasibility and continued use of a deferred loan or conversion to amortize loans; the process includes a site visit to de termine the upkeep of the unit and gathering of financial household information to determine eligibility. Desk monitoring of completed new construction projects is conducted to determine the appropriate intervals for performing site visits; in addition, almost all major projects receive restricted financing from other sources (e.g., federal tax credits, State funds), which typically include rigorous ongoing monitoring requirements.

In addition, transitioning of the multi -family reporting process into the C DS database was completed in FY 2013. The CDS database tracks all funded CDBG and HOME multi -family projects from award phase, construction phase to project completion. Thereafter, the project moves into the annual reporting category where it will remain active, meaning Annual Data Collection Forms will be submitted until the expiration of the affordability period. This provides Grantees with a more efficient data gathering process and offers a more consistent method in collecting annual reports and reviewing data for compliance. City staff continues to work with the CDS database programmers to ensure accurate compliance with project’s income/rent restrictions. Various challenges were encountered as numerous affordable housing projects have multiple rent/inc ome restri ctions imposed by other program regulations such as the City’s Inclusionary Housing Program and the Housing Successor Agency (HSA) . Thus, making it arduous to achieve comprehensive program compliance for each restricted unit. Staff continues to research an d implement system changes to attain comprehensive program compliance for all existing affordable housing projects.

As stated previously, City staff continues to enforce revised reporting policies for all CDBG and HOME projects. Annual, Quarterly or Monthly Reporting is accomplished through CDS. Grantees continue to submit Quarterly Progress Reports (QPR) with reporting periods as follows: Period 1- July 1 to September 30; Period 2-October 1 to December 31; Period 3- January 1 to March 31; and Period 4 -April 1 to June 30. Current reporting requirements during Period four for all CDBG and HOME assisted projects remains the same as pri or years as grantees are required to submit an Annual Project Narrative following the end of the fiscal year.

While the City no longer offers the First-Time Homebuyer Program (FTHB) for new assistance, all active FTHB program participants are monitored to determine that homeowners are using subject properties as their principal place of residence, maintaining proper hazard insur ance and are current on property taxes. Additional monitoring takes place throughout the year as homeowners contact staff to recei ve information on refinancing, subordination, loan payoff or just to ask questions about their loans. During these consultations, staff confirms that the information provided matches information in their project file.

As part of the City’s deferred rehabi litation loan program, staff has prepared a plan to begin the monitoring of these loans every five years as stipulated in their agreement; subject properties will be monitored for: deferred loan continued eligibility, using home as their principal place of residence, maintaining proper hazard insurance and are current on property taxes. The City also utilizes CDS as a notification tool to remind staff when a loan is due for a review.

Public Services: Staff prepares an annual Monitoring Plan. Monitoring of program progress, accomplishments, and compliance with HUD program rules is an ongoing activity conducted by staff by means of thorough review of monthly and quarterly reimbursement requests, activity reports, and rate of expenditures.

Staff completes a R isk Assessment of every subrecipient every year and in most cases, a Desk Review Monitoring, utilizing two checklists designed for that purpose. The Desk Review Monitoring draws on information in the file, but also documents submitted during the applicatio n process ( e.g., annual agency audit) since most have submitted applications for the following fiscal year. To determine compliance with accommodations for Persons of Limited English Proficiency, staff requests copies of outreach materials and applications.

Monitoring standards used are HUD’s forms under CDBG standards “Checklist for On-site Monitoring of a Subrecipient” in the “Managing CDBG, A Guidebook for Grantees on Subrecipient Oversight”, as well as City of Salinas' CDBG Desk DRAFT

CAPER B-3
OMB Control No: 2506-0117
Guide and ESG Manual. Forms used to complete the monitoring visit are in the “CPD Grantee Monitoring Handbook” under CDBG Entitlement depending upon the type of activity provided. Staff notifies the agency about potential visit dates to conduct a site visit and requests review of p rogram documents such as but not limited to agency's payroll ledger, employee timecards, receipts for other claimed expense s, the most recent financial audit, personnel policies, equal opportunity policy, case files, and client files that support the repor ted data for Salinas clients (as noted on the monthly and quarterly Activity Data Report). After the monitoring visit, a follow up letter is sent stating the results of the visit. If there are any issues or signs of noncompliance, it is discussed in detail with the program manager/executive director to assist in bringing the agency in compliance at the exit conference. Currently there have been no findings for any agency. Staff is currently in the follow-up phase of the onsite monitoring process.

CDBG-Public Facilities: Public Facility Improvement Projects (where improvements have been completed) are required to annually submi t an “Annual Data Collection Form” designed to capture service data such as: the total number of direct beneficiaries, race and ethnicity of each beneficiary, and all data required under HUD’s Community Planning and Development Performance Measurement System. The City’s Housing staff has currently transitioned all open projects to the CDS website, thus streamlining the reporting process and creating an improved database of all funded projects. As in prior reports, all data continues to be gathered on a mont hly and/or quarterly and annual basis.

Upon receipt of data, staff continues to review to ensure compliance with appropriate national objectives.

CDBG-Capital Improvement Projects: Staff continues to monitor projects during the design phase, bid opening phase, construction phase and completion phase to ensure compliance with all applicable federal provisions (i.e., Davis-Bacon, Minority Business Enterprise/Women Business Enterprise, Section 3, Executive Order 11246, Executive Order 11063, and Title 24 CFR Part 85). The City continues to revise and improve its existing tools to assist with project monitoring during these phases. Such tools include Federal Labor Compliance Checklist; Contractor and Subcontractor Compliance Worksheet; Quarterly Progress Report; and monthly or bi-weekly correspondence with the subrecipient or assigned City of Salinas Construction Inspector. Additionally, the City continues to review the previously developed standard CDBG Bid Specification Package that includes all applicable federal forms and provisions to ensure all forms and data are current. The City will continue to assess current process and research better methods for ensuring compliance with all federal provisions. Currently, the established process continues to significantly reduce the amount of staff time previously required to achieve compliance.

As previously reported, Labor compliance in Capital Improvement Projects continues to be a high priority. The PW Labor Compliance Officer continues to increase her knowledge re garding the Federal labor compliance regulations and continues to attend State and Federal Labor Compliance trainings.

DRAFT

CAPER C-1
OMB Control No: 2506-0117
Attachment C: IDIS Report – PR 26
The City’s PR 26 – CDBG Financial Summary Report is attached on the following pages.

DRAFT
45 TOTAL SUBJECT TO PA CAP (SUM, LINES 42-44) 2,152,188.69 46 PERCENT FUNDS OBLIGATED FOR PA ACTIVITIES (LINE 41/LINE 45) 20.00% 43 CURRENT YEAR PROGRAM INCOME 78,849.69
44 ADJUSTMENT TO COMPUTE TOTAL SUBJECT TO PA CAP 0.00
36 PERCENT FUNDS OBLIGATED FOR PS ACTIVITIES (LINE 31/LINE 35) 4.02% PART V: PLANNING AND ADMINISTRATION (PA) CAP
37 DISBURSED IN IDIS FOR PLANNING/ADMINISTRATION 995,130.65 40 ADJUSTMENT TO COMPUTE TOTAL PA OBLIGATIONS (564,787.81) 41 TOTAL PA OBLIGATIONS (LINE 37 + LINE 38 - LINE 39 +LINE 40) 430,342.84 42 ENTITLEMENT GRANT 2,073,339.00
38 PA UNLIQUIDATED OBLIGATIONS AT END OF CURRENT PROGRAM YEAR 0.00 39 PA UNLIQUIDATED OBLIGATIONS AT END OF PREVIOUS PROGRAM YEAR 0.00 31 TOTAL PS OBLIGATIONS (LINE 27 + LINE 28 - LINE 29 + LINE 30) 91,582.34 32 ENTITLEMENT GRANT 2,073,339.00
33 PRIOR YEAR PROGRAM INCOME 203,711.77
34 ADJUSTMENT TO COMPUTE TOTAL SUBJECT TO PS CAP 0.00
35 TOTAL SUBJECT TO PS CAP (SUM, LINES 32-34) 2,277,050.77 PART IV: PUBLIC SERVICE (PS) CAP CALCULATIONS
27 DISBURSED IN IDIS FOR PUBLIC SERVICES 91,582.34
28 PS UNLIQUIDATED OBLIGATIONS AT END OF CURRENT PROGRAM YEAR 0.00 29 PS UNLIQUIDATED OBLIGATIONS AT END OF PREVIOUS PROGRAM YEAR 0.00 30 ADJUSTMENT TO COMPUTE TOTAL PS OBLIGATIONS 0.00

LOW/MOD BENEFIT FOR MULTI-YEAR CERTIFICATIONS
23 PROGRAM YEARS(PY) COVERED IN CERTIFICATION PY: PY: PY:
24 CUMULATIVE NET EXPENDITURES SUBJECT TO LOW/MOD BENEFIT CALCULATION 2,374,484.42 25 CUMULATIVE EXPENDITURES BENEFITING LOW/MOD PERSONS 2,374,484.42 26 PERCENT BENEFIT TO LOW/MOD PERSONS (LINE 25/LINE 24) 100.00% 18 EXPENDED FOR LOW/MOD MULTI-UNIT HOUSING 142,936.38
19 DISBURSED FOR OTHER LOW/MOD ACTIVITIES 721,348.81
20 ADJUSTMENT TO COMPUTE TOTAL LOW/MOD CREDIT 0.00
21 TOTAL LOW/MOD CREDIT (SUM, LINES 17-20) 864,285.19
22 PERCENT LOW/MOD CREDIT (LINE 21/LINE 11) 100.00%
14 ADJUSTMENT TO COMPUTE TOTAL EXPENDITURES (498,195.00) 15 TOTAL EXPENDITURES (SUM, LINES 11-14) 1,361,220.84
16 UNEXPENDED BALANCE (LINE 08 - LINE 15) 6,627,244.35 PART III: LOWMOD BENEFIT THIS REPORTING PERIOD
17 EXPENDED FOR LOW/MOD HOUSING IN SPECIAL AREAS 0.00
09 DISBURSEMENTS OTHER THAN SECTION 108 REPAYMENTS AND PLANNING/ADMINISTRATION 864,285.19 10 ADJUSTMENT TO COMPUTE TOTAL AMOUNT SUBJECT TO LOW/MOD BENEFIT 0.00 11 AMOUNT SUBJECT TO LOW/MOD BENEFIT (LINE 09 + LINE 10) 864,285.19 12 DISBURSED IN IDIS FOR PLANNING/ADMINISTRATION 995,130.65 13 DISBURSED IN IDIS FOR SECTION 108 REPAYMENTS 0.00
06 FUNDS RETURNED TO THE LINE-OF-CREDIT 14,339.50
06a FUNDS RETURNED TO THE LOCAL CDBG ACCOUNT 0.00
07 ADJUSTMENT TO COMPUTE TOTAL AVAILABLE 0.00
08 TOTAL AVAILABLE (SUM, LINES 01-07) 7,988,465.19
PART II: SUMMARY OF CDBG EXPENDITURES
02 ENTITLE
MENT GRANT 2,073,339.00
03 SURPLUS URBAN RENEWAL 0.00
04 SECTION 108 GUARANTEED LOAN FUNDS 0.00
05 CURRENT YEAR PROGRAM INCOME 78,849.69
05a CURRENT YEAR SECTION 108 PROGRAM INCOME (FOR SI TYPE) 0.00

SALINAS , CA
Metrics
Grantee SALINAS , CA
Program Year 2,022.00
20:31
Integrated Disbursement and Information System PAGE: 1 PR26 - CDBG Financial Summary Report
Program Year 2022
PART I: SUMMARY OF CDBG RESOURCES
01 UNEXPENDED CDBG FUNDS AT END OF PREVIOUS PROGRAM YEAR 5,821,937.00 Office of Community Planning and Development DATE: 08-24-23 U.S. Department of Housing and Urban Development TIME:

DRAFT
Plan
Year
IDIS
Project
2019 4

Total
Plan
Year
IDIS
Project
IDIS
Activity
Voucher
Number
2017 24 1555 6668433
2017 24 1555 6720900
2017 24 1555 6741525
2017 24 1555 6741929
2017 24 1555 6794957
2020 8 1596 6668433
2020 8 1596 6715991
2020 8 1596 6720894
2020 8 1596 6720899
2020 8 1596 6720900
2020 8 1596 6741525
2020 8 1596 6741929
2020 8 1596 6741945
2020 8 1596 6791984
2020 8 1596 6795566
2020 8 1596 6801208
2020 8 1596 6801209

2019 5 1602 6668433
2019 5 1602 6715991
2019 5 1602 6720894
2019 5 1602 6720899
2019 5 1602 6720900
2019 5 1602 6741525
2019 5 1602 6741929
2019 5 1602 6741945
2019 5 1602 6741995
2019 5 1602 6791921
2019 5 1602 6791967
2019 5 1602 6791984
2020 9 1618 6801208
2020 9 1618 6801209
2022 9 1615 6791921
2022 9 1615 6791967
2022 9 1615 6791984
2022 9 1615 6794962
2022 9 1615 6794964
2022 9 1615 6794965
2022 9 1615 6794966
2022 9 1615 6795566
2022 9 1615 6801208
2022 9 1615 6801209

2019 6 1614 6791921
2019 6 1614 6791967
2019 6 1614 6791984
2019 6 1614 6794964
2019 6 1614 6795566
2019 6 1614 6801208
2019 6 1614 6801209

Early Childhood Development Center Project 03M LMC $895.59 Early Childhood Development Center Project 03M LMC $660.49 03M Matrix Code $4,321.48
03F Matrix Code $311,608.03
Early Childhood Development Center Project 03M
Early Childhood Development Center Project 03M LMC $475.20 LMC $729.43
Early Childhood Development Center Project 03M LMC $755.38 Early Childhood Development Center Project 03M LMC $756.58 Early Childhood Development Center Project 03M LMC $48.81 Hebbron Family Center (Soft Cost) 03F LMA $34,046.56
Hebbron Family Center (Soft Cost) 03F
Hebbron Family Center (Soft Cost) 03F LMA $3,593.73
LMA $55,799.89
Hebbron Family Center (Soft Cost) 03F LMA $1,553.04
Hebbron Family Center (Soft Cost) 03F LMA $2,827.74
Hebbron Family Center (Soft Cost) 03F LMA $5,015.29
Sherwood Recreation Center Phase IV 03F LMA $3,671.91
Sherwood Recreation Center Phase IV 03F
Hebbron Family Center (Soft Cost) 03F LMA $36,891.68
LMA $2,043.40
Hebbron Family Center (Soft Cost) 03F LMA $84,372.60
Hebbron Family Center (Soft Cost) 03F LMA $24,544.80
Hebbron Family Center (Soft Cost) 03F LMA $2,661.15
Natividad Creek Park Restroom Rehabilitation and ADA Improvements Project 03F LMA $4,197.79 Natividad Creek Park Restroom Rehabilitation and ADA Improvements Project 03F Natividad Creek Park Restroom Rehabilitation and ADA Improvements Project 03F LMA $2,735.38 LMA $5,301.76
Natividad Creek Park Restroom Rehabilitation and ADA Improvements Project 03F LMA $13,489.99 Natividad Creek Park Restroom Rehabilitation and ADA Improvements Project 03F LMA $1,805.78 Natividad Creek Park Restroom Rehabilitation and ADA Improvements Project 03F LMA $1,930.42 Natividad Creek Park Restroom Rehabilitation and ADA Improvements Project 03F LMA $545.04 Nativ
idad Creek Park Restroom Rehabilitation and ADA Improvements Project 03F Natividad Creek Park Restroom Rehabilitation and ADA Improvements Project 03F LMA $7,960.60 LMA $1,903.41
Natividad Creek Park Restroom Rehabilitation and ADA Improvements Project 03F LMA $3,970.04 Natividad Creek Park Restroom Rehabilitation and ADA Improvements Project 03F LMA $4,562.93 Natividad Creek Park Restroom Rehabilitation and ADA Improvements Project 03F LMA $6,183.10 Sun Rose Housing Development (2020) 03C LMC $1,445.93
Sun Rose Housing Development (2020) 03C
Sun Rose Housing Development (2020) 03C LMC $358.23
LMC $190.08
Sun Rose Housing Development (2020) 03C LMC $1,513.15
03C Matrix Code $313,836.96
Sun Rose Housing Development (2020) 03C LMC $990.74
Sun Rose Housing Development (2020) 03C LMC $416.37
Sun Rose Housing Development (2020) 03C
Sun Rose Housing Development (2020) 03C LMC $636.50
LMC $868.45
Sun Rose Housing Development (2020) 03C LMC $915.82
Sun Rose Housing Development (2020) 03C LMC $927.42
Sun Rose Housing Development (2020) 03C LMC $501.92
First United Methodist Church Kitchen Remodel 03C LMC $121.13 First United Methodist Church Kitchen Remodel 03C
First United Methodist Church Kitchen Remodel 03C LMC $170,123.15 LMC $19,339.56
First United Methodist Church Kitchen Remodel 03C LMC $97,000.00 Sun Rose Housing Development (2020) 03C LMC $666.16
First United Methodist Church Kitchen Remodel 03C LMC $17,822.35 LINE 17 DETAIL: ACTIVITIES TO CONSIDER IN DETERMINING THE AMOUNT TO ENTER ON LINE 17 No data returned for this view. This might be because the applied filter excludes all data.

Activity Name Matrix
Code
National
Objective Drawn Amount
1597 Catalyst Apartments Rehabilitation Project (2019) 14B LMH $142,936.38 $142,936.38
LINE 19 DETAIL: ACTIVITIES INCLUDED IN THE COMPUTATION OF LINE 19 LINE 18 DETAIL: ACTIVITIES TO CONSIDER IN DETERMINING THE AMOUNT TO ENTER ON LINE 18 IDIS Activity Activity Name Matrix
Code
National
Objective Drawn Amount
14B Matrix Code $142,936.38
DRAFT
2022 4 1616 6791921
2022 4 1616 6791967
2022 4 1616 6791984
2022 4 1616 6794962
2022 4 1616 6795566
2022 4 1616 6801208
2022 4 1616 6801209

Total
Plan
Year
IDIS
Project
IDIS
Activity
Voucher
Number
Activity to
prevent Activity Name Grant Number Fund
Type
2022 4 1616 6791921 No ECHO Fair Housing and Tenant/Landlord Services (2022) B22MC060005 EN 2022 4 1616 6791921 No ECHO Fair Housing and Tenant/Landlord Services (2022) B22MC060005 PI 2022 4 1616 6791967 No ECHO Fair Housing and Tenant/Landlord Services (2022) B22MC060005 EN 2022 4 1616 6791967 No ECHO Fair Housing and Tenant/Landlord Services (2022) B22MC060005 PI 2022 4 1616 6791984 No ECHO Fair Housing and Tenant/Landlord Services (2022) B22MC060005 EN 2022 4 1616 6791984 No ECHO Fair Housing and Tenant/Landlord Services (2022) B22MC060005 PI 2022 4 1616 6794962 No ECHO Fair Housing and Tenant/Landlord Services (2022) B22MC060005 EN 2022 4 1616 6795566 No ECHO Fair Housing and Tenant/Landlord Services (2022) B22MC060005 EN 2022 4 1616 6795566 No ECHO Fair Housing and Tenant/Landlord Services (2022) B22MC060005 PI 2022 4 1616 6801208 No ECHO Fair Housing and Tenant/Landlord Services (2022) B22MC060005 EN 2022 4 1616 6801208 No ECHO Fair Housing and Tenant/Landlord Services (2022) B22MC060005 PI 2022 4 1616 6801209 No ECHO Fair Housing and Tenant/Landlord Services (2022) B22MC060005 EN

No Activity to prevent, prepare for, and respond to Coronavirus Total
Plan
Year
IDIS
Project
IDIS
Activity
Voucher
Number
1994 2 2 6664593
1994 2 2 6728236
1994 2 2 6742186
2021 7 1603 6668433
2022 8 1609 6715991
2022 8 1609 6720894
2022 8 1609 6720899
2022 8 1609 6720900
2022 8 1609 6741525
2022 8 1609 6741929
2022 8 1609 6741945
2022 8 1609 6741995
2022 8 1609 6742001
2022 8 1609 6791921
2022 8 1609 6791967
2022 8 1609 6791984
2022 8 1609 6794957
2022 8 1609 6794960
2022 8 1609 6795566
2022 8 1609 6801208
2022 8 1609 6801209

Total
CDBG Program Planning and Administration (2022) 21A $30,896.97 CDBG Program Planning and Administration (2022) 21A $15,302.27 21A Matrix Code $995,130.65
$995,130.65
CDBG Program Planning and Administration (2022) 21A $34,712.75 CDBG Program Planning and Administration (2022) 21A
CDBG Program Planning and Administration (2022) 21A $22,529.48 $42,213.87
CDBG Program Planning and Administration (2022) 21A $34,317.89 CDBG Program Planning and Administration (2022) 21A $26,470.54 CDBG Program Planning and Administration (2022) 21A $12,548.23 CDBG Program Planning and Administration (2022) 21A $36,466.51 CDBG Program Planning and Administration (2022) 21A
CDBG Program Planning and Administration (2022) 21A $24,814.87 $26,331.85
CDBG Program Planning and Administration (2022) 21A $22,653.99 CDBG Program Planning and Administration (2022) 21A $839.85 CDBG Program Planning and Administration (2022) 21A $29,841.49 CDBG COMMITTED FUNDS ADJUSTMENT 21A $14,339.50
CDBG COMMITTED FUNDS ADJUSTMENT 21A
CDBG Program Planning and Administration (2022) 21A $14,452.51 ($14,339.50)
CDBG Program Planning and Administration (2021) 21A $66,592.81 CDBG Program Planning and Administration (2022) 21A $47,997.77 CDBG Program Planning and Administration (2022) 21A $7,952.00 CDBG COMMITTED FUNDS ADJUSTMENT 21A $498,195.00
05J LMC $8,268.88
05J Matrix Code $91,582.34
$91,582.34
LINE 37 DETAIL: ACTIVITIES INCLUDED IN THE COMPUTATION OF LINE 37 Activity Name
Matrix
Code
National
Objective Drawn Amount
$91,582.34
05J LMC $2,080.00
05J LMC $8,776.55
05J LMC $474.48
05J LMC $2,800.00
05J LMC $21,459.95
05J LMC $6,470.91
05J LMC $23,638.61
05J LMC $2,080.00
05J LMC $5,946.91
ECHO Fair Housing and Tenant/Landlord Services (2022) 05J LMC $21,459.95 ECHO Fair Housing and Tenant/Landlord Services (2022)
05J LMC $1,520.00
ECHO Fair Housing and Tenant/Landlord Services (2022) 05J LMC $8,268.88 05J Matrix Code
LINE 27 DETAIL: ACTIVITIES INCLUDED IN THE COMPUTATION OF LINE 27 Matrix
Code
National
Objective Drawn Amount
05J LMC $8,066.05
05J LMC $8,550.91
ECHO Fair Housing and Tenant/Landlord Services (2022) 05J LMC $9,251.03 $91,582.34
$721,348.81
ECHO Fair Housing and Tenant/Landlord Services (2022) 05J LMC $9,586.05 ECHO Fair Housing and Tenant/Landlord Services (2022) 05J LMC $8,746.91 ECHO Fair Housing and Tenant/Landlord Services (2022) 05J LMC $25,718.61 DRAFT
08-25-23
14:03
1 19 DISBURSED IN IDIS FOR PLANNING/ADMINISTRATION 381,407.41 20 CDBG-CV GRANT 2,400,157.00
21 PERCENT OF FUNDS DISBURSED FOR PA ACTIVITIES (LINE 19/LINE 20) 15.89% PART IV: PUBLIC SERVICE (PS) CALCULATIONS
16 DISBURSED IN IDIS FOR PUBLIC SERVICES 939,500.24
17 CDBG-CV GRANT 2,400,157.00
18 PERCENT OF FUNDS DISBURSED FOR PS ACTIVITIES (LINE 16/LINE 17) 39.14% PART V: PLANNING AND ADMINISTRATION (PA) CAP
11 EXPENDED FOR LOW/MOD MULTI-UNIT HOUSING 0.00
12 DISBURSED FOR OTHER LOW/MOD ACTIVITIES 1,380,389.79 13 TOTAL LOW/MOD CREDIT (SUM, LINES 10 - 12) 1,380,389.79 14 AMOUNT SUBJECT TO LOW/MOD BENEFIT (LINE 05) 1,380,389.79 15 PERCENT LOW/MOD CREDIT (LINE 13/LINE 14) 100.00%
07 DISBURSED IN IDIS FOR SECTION 108 REPAYMENTS 0.00
08 TOTAL EXPENDITURES (SUM, LINES 05 - 07) 1,761,797.20 09 UNEXPENDED BALANCE (LINE 04 - LINE8 ) 638,359.80
PART III: LOWMOD BENEFIT FOR THE CDBG-CV GRANT
10 EXPENDED FOR LOW/MOD HOUSING IN SPECIAL AREAS 0.00
03 FUNDS RETURNED TO THE LOCAL CDBG ACCOUNT 0.00
04 TOTAL CDBG-CV FUNDS AWARDED 2,400,157.00
PART II: SUMMARY OF CDBG-CV EXPENDITURES
05 DISBURSEMENTS OTHER THAN SECTION 108 REPAYMENTS AND PLANNING/ADMINISTRATION 1,380,389.79 06 DISBURSED IN IDIS FOR PLANNING/ADMINISTRATION 381,407.41 Metrics
New Grantee (CV) SALINAS , CA
PART I: SUMMARY OF CDBG-CV RESOURCES
01 CDBG-CV GRANT 2,400,157.00
02 FUNDS RETURNED TO THE LINE-OF-CREDIT 0.00
Office of Community Planning and Development DATE:

U.S. Department of Housing and Urban Development TIME:

Integrated Disbursement and Information System PAGE:

PR26 - CDBG-CV Financial Summary Report

SALINAS , CA
DRAFT
Plan Year Voucher
Number Activity Name
6476163 Eden Council for Hope and Opportunity ECHO CDBG-CV 6525705 Eden Council for Hope and Opportunity ECHO CDBG-CV 6525715 Eden Council for Hope and Opportunity ECHO CDBG-CV 6531567 Eden Council for Hope and Opportunity ECHO CDBG-CV 6635798 Eden Council for Hope and Opportunity ECHO CDBG-CV 6635805 Eden Council for Hope and Opportunity ECHO CDBG-CV 6664858 Eden Council for Hope and Opportunity ECHO CDBG-CV 6667409 Eden Council for Hope and Opportunity ECHO CDBG-CV 6676634 Eden Council for Hope and Opportunity ECHO CDBG-CV 6741525 Eden Council for Hope and Opportunity ECHO CDBG-CV 6461782 Food Bank for Monterey County CDBG-CV
6525683 Food Bank for Monterey County CDBG-CV
6525715 Food Bank for Monterey County CDBG-CV
6525682 City of Salinas Housing Information and Referral Services - CDBG-CV 6525683 City of Salinas Housing Information and Referral Services - CDBG-CV 6525705 City of Salinas Housing Information and Referral Services - CDBG-CV 6525709 City of Salinas Housing Information and Referral Services - CDBG-CV 6525715 City of Salinas Housing Information and Referral Services - CDBG-CV 6525741 City of Salinas Housing Information and Referral Services - CDBG-CV 6531567 City of Salinas Housing Information and Referral Services - CDBG-CV 6616500 City of Salinas Housing Information and Referral Services - CDBG-CV 6616506 City of Salinas Housing Information and Referral Services - CDBG-CV 6635794 City of Salinas Housing Information and Referral Services - CDBG-CV 6635797 City of Salinas Housing Information and Referral Services - CDBG-CV 6635798 City of Salinas Housing Information and Referral Services - CDBG-CV 6635801 City of Salinas Housing Information and Referral Services - CDBG-CV 6635805 City of Salinas Housing Information and Referral Services - CDBG-CV 6635806 City of Salinas Housing Information and Referral Services - CDBG-CV 6635808 City of Salinas Housing Information and Referral Services - CDBG-CV 6664858 City of Salinas Housing Information and Referral Services - CDBG-CV 6667409 City of Salinas Housing Information and Referral Services - CDBG-CV 6676634 City of Salinas Housing Information and Referral Services - CDBG-CV 6736408 City of Salinas Housing Information and Referral Services - CDBG-CV 6736412 City of Salinas Housing Information and Referral Services - CDBG-CV 6736415 City of Salinas Housing Information and Referral Services - CDBG-CV 6736419 City of Salinas Housing Information and Referral Services - CDBG-CV 6736433 City of Salinas Housing Information and Referral Services - CDBG-CV 6676634 City of Salinas Fair Housing CDBG-CV
6736408 City of Salinas Fair Housing CDBG-CV
6736412 City of Salinas Fair Housing CDBG-CV
6736415 City of Salinas Fair Housing CDBG-CV
6736419 City of Salinas Fair Housing CDBG-CV
6736433 City of Salinas Fair Housing CDBG-CV
05X LMC $4,818.47
1583 05J LMC $238.23
05J LMC $2,556.97
05J LMC $1,480.04
05J LMC $484.30
05J LMC $54.63
05J LMC $569.25
05X LMC $7,115.86
05X LMC $4,736.06
05X LMC $3,573.58
05X LMC $5,691.72
05X LMC $8,092.24
05X LMC $7,716.50
05X LMC $5,879.39
05X LMC $8,784.21
05X LMC $5,036.44
05X LMC $523.35
05X LMC $7,881.21
05X LMC $6,776.82
$7,202.30
05X LMC $8,607.13
05X LMC $9,001.79
05X LMC $165.25
1582 05X LMC $440.85
05X LMC $2,344.18
05X LMC $344.75
05X
LMC $12,102.66
05X LMC $8,276.12
05X LMC $4,214.16
05X LMC $13,799.63
05X LMC
05J LMC $9,769.99
05J LMC $8,417.66
1581 05W LMC $81,007.20
05W LMC $158,461.92
05W LMC $71,487.88
$19,585.34
05J LMC $28,833.01
05J LMC $16,623.40
05J LMC $16,770.60
No data returned for this view. This might be because the applied filter excludes all data.

LINE 12 DETAIL: ACTIVITIES INCLUDED IN THE COMPUTATION OF LINE 12 IDIS Project IDIS
Activity
Matrix
Code
National
Objective Drawn Amount
2020 1 1580 05J LMC $13,075.86
05J LMC $16,352.69
05J LMC $24,668.64
05J LMC $29,902.81
05J LMC
LINE 10 DETAIL: ACTIVITIES TO CONSIDER IN DETERMINING THE AMOUNT TO ENTER ON LINE 10 No data returned for this view. This might be because the applied filter excludes all data.

LINE 11 DETAIL: ACTIVITIES TO CONSIDER IN DETERMINING THE AMOUNT TO ENTER ON LINE 11 DRAFT
6525682 Grow Salinas Fund - CV
6525683 Grow Salinas Fund - CV
6525705 Grow Salinas Fund - CV
6525709 Grow Salinas Fund - CV
6525715 Grow Salinas Fund - CV
6525741 Grow Salinas Fund - CV
6531567 Grow Salinas Fund - CV
6676634 Economic Development Technical Assistance - CV
6736408 Economic Development Technical Assistance - CV
6736412 Economic Development Technical Assistance - CV
6736415 Economic Development Technical Assistance - CV
6736419 Economic Development Technical Assistance - CV
6736433 Economic Development Technical Assistance - CV
6525682 Economic Development Technical Assistance - CV (Micro Business Et i )6525683 Economic Development Technical Assistance - CV (Micro Business Et i )6525705 Economic Development Technical Assistance - CV (Micro Business Et i )6525709 Economic Development Technical Assistance - CV (Micro Business Et i )6525715 Economic Development Technical Assistance - CV (Micro Business Et i )6525741 Economic Development Technical Assistance - CV (Micro Business Et i )6531567 Economic Development Technical Assistance - CV (Micro Business Et i )6616500 Economic Development Technical Assistance - CV (Micro Business Et i )6616506 Economic Development Technical Assistance - CV (Micro Business Et i )6635794 Economic Development Technical Assistance - CV (Micro Business Et i )6635797 Economic Development Technical Assistance - CV (Micro Business Et i )6635798 Economic Development Technical Assistance - CV (Micro Business Et i )6635801 Economic Development Technical Assistance - CV (Micro Business Et i )6635805 Economic Development Technical Assistance - CV (Micro Business Et i )6635806 Economic Development Technical Assistance - CV (Micro Business Et i )6635808 Economic Development Technical Assistance - CV (Micro Business Et i )6664858 Economic Development Technical Assistance - CV (Micro Business Et i )6667409 Economic Development Technical Assistance - CV (Micro Business Et i )6676634 Economic Development Technical Assistance - CV (Micro Business Et i )6736408 Economic Development Technical Assistance - CV (Micro Business Et i )6736412 Economic Development Technical Assistance - CV (Micro Business Et i )6736415 Economic Development Technical Assistance - CV (Micro Business Et i )6736419 Economic Development Technical Assistance - CV (Micro Business Et i )6736433 Economic Development Technical Assistance - CV (Micro Business Et i )6525705 Salvation Army Food Distribution CDBG-CV
6531567 Salinas Downtown Streets Team 2nd Team - CV
6635794 Salinas Downtown Streets Team 2nd Team - CV
6635797 Salinas Downtown Streets Team 2nd Team - CV
6635798 Salinas Downtown Streets Team 2nd Team - CV
6635801 Salinas Downtown Streets Team 2nd Team - CV
6635806 Salinas Downtown Streets Team 2nd Team - CV
6664858 Salinas Downtown Streets Team 2nd Team - CV
6667409 Salinas Downtown Streets Team 2nd Team - CV
6676634 Salinas Downtown Streets Team 2nd Team - CV
6736419 Salinas Downtown Streets Team 2nd Team - CV
6736433 Salinas Downtown Streets Team 2nd Team - CV
Total
Plan Year
Voucher
Number Activity Name
6476163 Eden Council for Hope and Opportunity ECHO CDBG-CV 6525705 Eden Council for Hope and Opportunity ECHO CDBG-CV 6525715 Eden Council for Hope and Opportunity ECHO CDBG-CV 6531567 Eden Council for Hope and Opportunity ECHO CDBG-CV 6635798 Eden Council for Hope and Opportunity ECHO CDBG-CV 6635805 Eden Council for Hope and Opportunity ECHO CDBG-CV 6664858 Eden Council for Hope and Opportunity ECHO CDBG-CV 6667409 Eden Council for Hope and Opportunity ECHO CDBG-CV 6676634 Eden Council for Hope and Opportunity ECHO CDBG-CV 6741525 Eden Council for Hope and Opportunity ECHO CDBG-CV 05J LMC $16,770.60
05J LMC $9,769.99
05J LMC $8,417.66
2020 1 1580 05J LMC $13,075.86
05J LMC $16,352.69
05J LMC $24,668.64
05J LMC $29,902.81
05J LMC $19,585.34
05J LMC $28,833.01
05J LMC $16,623.40
$1,380,389.79
LINE 16 DETAIL: ACTIVITIES INCLUDED IN THE COMPUTATION OF LINE 16 IDIS Project IDIS
Activity
Matrix
Code
National
Objective Drawn Amount
05Z LMC $16,839.01
05Z LMC $12,174.04
05Z LMC $4,673.24
05Z LMC $18,511.49
05Z LMC $68,108.62
05Z LMC $11,327.36
18C LMASA $6,387.95
2 1592 03T LMC $58,035.15
1600 05Z LMC $31,307.22
05Z LMC $31,486.87
05Z LMC $15,092.43
05Z LMC $14,174.89
05Z LMC $14,304.83
18C LMASA $9,150.26
18C LMASA $6,387.95
18C LMASA $6,387.96
18C LMASA $10,734.32
18C LMASA $14,016.04
18C LMASA $2,904.79
18C LMASA $11,969.10
18C LMASA $12,326.73
18C LMASA $8,581.33
18C LMASA $8,356.62
18C LMASA $8,479.60
18C LMASA $8,582.72
$9,067.88
18C LMASA $6,559.84
18C LMASA $7,064.76
18C LMASA $7,405.08
1591 18C LMASA $9,361.38
18C LMASA $7,947.76
18C LMASA $8,130.84
18C LMASA $11,306.59
18C LMASA $8,130.84
18C LMASA $8,310.01
18C
LMASA $11,417.16
18C LMASA
1590 18B LMASA $283.54
18B LMASA $2,641.96
18B LMASA $3,921.54
18B LMASA $2,738.83
18B LMASA $2,738.83
18B LMASA $2,738.83
1589 18A LMASA $930.28
18A LMASA $3,315.20
18A LMASA $5,176.84
18A LMASA $4,615.20
18A LMASA $1,676.61
18A LMASA $198,590.04
18A LMASA $2,554.34
DRAFT
6461782 Food Bank for Monterey County CDBG-CV
6525683 Food Bank for Monterey County CDBG-CV
6525715 Food Bank for Monterey County CDBG-CV
6525682 City of Salinas Housing Information and Referral Services - CDBG-CV 6525683 City of Salinas Housing Information and Referral Services - CDBG-CV 6525705 City of Salinas Housing Information and Referral Services - CDBG-CV 6525709 City of Salinas Housing Information and Referral Services - CDBG-CV 6525715 City of Salinas Housing Information and Referral Services - CDBG-CV 6525741 City of Salinas Housing Information and Referral Services - CDBG-CV 6531567 City of Salinas Housing Information and Referral Services - CDBG-CV 6616500 City of Salinas Housing Information and Referral Services - CDBG-CV 6616506 City of Salinas Housing Information and Referral Services - CDBG-CV 6635794 City of Salinas Housing Information and Referral Services - CDBG-CV 6635797 City of Salinas Housing Information and Referral Services - CDBG-CV 6635798 City of Salinas Housing Information and Referral Services - CDBG-CV 6635801 City of Salinas Housing Information and Referral Services - CDBG-CV 6635805 City of Salinas Housing Information and Referral Services - CDBG-CV 6635806 City of Salinas Housing Information and Referral Services - CDBG-CV 6635808 City of Salinas Housing Information and Referral Services - CDBG-CV 6664858 City of Salinas Housing Information and Referral Services - CDBG-CV 6667409 City of Salinas Housing Information and Referral Services - CDBG-CV 6676634 City of Salinas Housing Information and Referral Services - CDBG-CV 6736408 City of Salinas Housing Information and Referral Services - CDBG-CV 6736412 City of Salinas Housing Information and Referral Services - CDBG-CV 6736415 City of Salinas Housing Information and Referral Services - CDBG-CV 6736419 City of Salinas Housing Information and Referral Services - CDBG-CV 6736433 City of Salinas Housing Information and Referral Services - CDBG-CV 6676634 City of Salinas Fair Housing CDBG-CV
6736408 City of Salinas Fair Housing CDBG-CV
6736412 City of Salinas Fair Housing CDBG-CV
6736415 City of Salinas Fair Housing CDBG-CV
6736419 City of Salinas Fair Housing CDBG-CV
6736433 City of Salinas Fair Housing CDBG-CV
6525705 Salvation Army Food Distribution CDBG-CV
6531567 Salinas Downtown Streets Team 2nd Team - CV
6635794 Salinas Downtown Streets Team 2nd Team - CV
6635797 Salinas Downtown Streets Team 2nd Team - CV
6635798 Salinas Downtown Streets Team 2nd Team - CV
6635801 Salinas Downtown Streets Team 2nd Team - CV
6635806 Salinas Downtown Streets Team 2nd Team - CV
6664858 Salinas Downtown Streets Team 2nd Team - CV
6667409 Salinas Downtown Streets Team 2nd Team - CV
6676634 Salinas Downtown Streets Team 2nd Team - CV
6736419 Salinas Downtown Streets Team 2nd Team - CV
6736433 Salinas Downtown Streets Team 2nd Team - CV
Total
Plan Year
Voucher
Number Activity Name
6413677 CDBG-CV Planning and Program Administration (2020) 6413680 CDBG-CV Planning and Program Administration (2020) 6413697 CDBG-CV Planning and Program Administration (2020) 6450561 CDBG-CV Planning and Program Administration (2020) 6461780 CDBG-CV Planning and Program Administration (2020) 6461781 CDBG-CV Planning and Program Administration (2020) 6461782 CDBG-CV Planning and Program Administration (2020) 6476163 CDBG-CV Planning and Program Administration (2020) 6525682 CDBG-CV Planning and Program Administration (2020) 6525683 CDBG-CV Planning and Program Administration (2020) 6525705 CDBG-CV Planning and Program Administration (2020) 6525709 CDBG-CV Planning and Program Administration (2020) 6525715 CDBG-CV Planning and Program Administration (2020) 6525741 CDBG-CV Planning and Program Administration (2020) 6531567 CDBG-CV Planning and Program Administration (2020) 21A $7,151.65 21A $9,080.63
21A $5,146.43
21A $4,764.03
21A $12,185.64
21A $12,630.26
21A $8,764.92
21A $20,673.89
21A $17,518.69
21A $21,230.02
LINE 19 DETAIL: ACTIVITIES INCLUDED IN THE COMPUTATION OF LINE 19 IDIS Project
IDIS
Activity
Matrix
Code
National
Objective Drawn Amount
2020 3 1578 21A $368.35
21A $11,230.09
21A $23,682.48
21A $30,615.05
21A $28,302.35
05Z LMC $12,174.04
05Z LMC $4,673.24
$939,500.24
05Z LMC $68,108.62
05Z LMC $11,327.36
05Z LMC $16,839.01
2 1592 03T LMC $58,035.15
1600 05Z LMC $31,307.22
05Z LMC $31,486.87
05Z LMC $15,092.43
05Z LMC $14,174.89
05Z LMC $14,304.83
05Z LMC $18,511.49
05X LMC $4,818.47
1583 05J LMC $238.23
05J LMC $2,556.97
05J LMC $1,480.04
05J LMC $484.30
05J LMC $54.63
05J LMC $569.25
05X LMC $7,115.86
05X LMC $4,736.06
05X LMC $3,573.58
05X LMC $5,691.72
05X LMC $8,092.24
05X LMC $7,716.50
05X LMC $5,879.39
05X LMC $8,784.21
05X LMC $5,036.44
05X LMC $523.35
05X LMC $7,881.21
05X LMC $6,776.82
$7,202.30
05X LMC $8,607.13
05X LMC $9,001.79
05X LMC $165.25
1582 05X LMC $440.85
05X LMC $2,344.18
05X LMC $344.75
05X LMC $12,102.66
05X LMC $8,276.12
05X LMC $4,214.16
05X LMC $13,799.63
05X LMC
1581 05W LMC $81,007.20
05W LMC $158,461.92
05W LMC $71,487.88
DRAFT
6616500 CDBG-CV Planning and Program Administration (2020) 6616506 CDBG-CV Planning and Program Administration (2020) 6635794 CDBG-CV Planning and Program Administration (2020) 6635797 CDBG-CV Planning and Program Administration (2020) 6635798 CDBG-CV Planning and Program Administration (2020) 6635801 CDBG-CV Planning and Program Administration (2020) 6635805 CDBG-CV Planning and Program Administration (2020) 6635806 CDBG-CV Planning and Program Administration (2020) 6635808 CDBG-CV Planning and Program Administration (2020) 6664858 CDBG-CV Planning and Program Administration (2020) 6667409 CDBG-CV Planning and Program Administration (2020) 6676634 CDBG-CV Planning and Program Administration (2020) 6736408 CDBG-CV Planning and Program Administration (2020) 6736412 CDBG-CV Planning and Program Administration (2020) 6736415 CDBG-CV Planning and Program Administration (2020) 6736419 CDBG-CV Planning and Program Administration (2020) 6736433 CDBG-CV Planning and Program Administration (2020) Total $381,407.41
21A $7,660.18
21A $6,555.90
21A $5,430.69
21A $5,947.11
21A $16,932.84
21A $5,153.60
21A $4,996.62
21A $2,493.70
21A $7,656.40
21A $3,918.24
21A $27,254.18
21A $4,347.22
21A $13,717.36
21A $11,766.34
21A $11,825.25
21A $21,132.60
21A $11,274.70
DRAFT

CAPER D-1
OMB Control No: 2506-0117 (exp. 07/31/2015)
Attachment D: CAPER Resolution
CAPER City resolution is pending and will be attached upon approval by the Salinas City Council.

DRAFT
Submission of the FY 2022-23
Consolidated Annual Performance and Evaluation Report
to U.S Department of Housing and Urban Development
Community Development Department
Housing Division
Meeting Date: September 12, 2023
Sun Rose Apartments Construction
Recommended Action
It is recommended that City Council adopt a resolution approving the Fiscal Year 2022-23 Consolidated Annual Performance and Evaluation Report (CAPER) and authorize submittal to United States Department of Housing and Urban Development (HUD).

Executive Summary
City is a HUD entitlement jurisdiction:
 Community Development Block Grant (CDBG and CDBG-CV)
 HOME Investment Partnerships Program (HOME)
 HOME American Rescue Plan (HOME-ARP)
 Emergency Solutions Grants (ESG and ESG-CV)
CAPER is an annual assessment of all activities and accomplishments  FY 2022-23 Annual Action Plan (AAP)
 FY 2020-24 Consolidated Plan (Con Plan) and the
HUD Submission Deadline: September 30, 2023
Background
HUD Citizen Participation Plan
 Minimum15-day public comment period August 26th – September 12th, 2023  Notices published in The Monterey Herald on August 26, 2023  Draft CAPER available for public view
 City website
 In-person and by appointment at CDD offices
 Email request
 Public Hearing: City Council Meeting - 4:00 p.m. September 12, 2023 FY 2022-23 HUD FUNDING AND EXPENDITURES
Program Total Available
Funding Expenditures
CDBG $7,974,126* $1,361,221
CDBG-CV $784,463* $146,103
HOME $2,132,271* $121,982
HOME-ARP $2,918,774 $0
ESG $520,705* $465,992
ESG-CV $1,752,704* $1,646,889
Total $16,083,043 $3,745,427
Housing & Development Forum
Sun Rose Apartments Construction
* Includes remaining funds from prior fiscal years

FY 2022-23 CDBG Program
Agency Funding Category Funding Amount Expenditures Outcomes City of Salinas
Program
Administration
(20% Grant & PI)
$430,343 $430,343 N/A
Interim Inc. Housing $1,059,140* $289,729 6
Housing Units
City of Salinas
First United Methodist Church
Alisal
Union School District
Public Facility $6,116,755* $619,668 5
Public Facilities
Salinas Outreach and Response
Team (SOR
T)
Eden Council for Hope and
Opportunity (ECHO)
Public Service $235,800 $91,582 165
Households
* Includes funding from previous fiscal years
FY 2022-23 CDBG-CV
Agency Funding
Category
Funding
Amount * Expenditures Outcomes
City of Salinas
Program
Administration
(20% )
$480,031 $57,830 N/A
City of Salinas
Downtown Streets Inc.

ECHO
Public Service $1,197,000 $296,482
408
Households
52 Business
*Includes funding from prior fiscal years
FY 2022-23 ESG Program
SHARE Center
Agency Funding
Category
Funding
Amount * Expenditures Outcomes
City of Salinas
Program
Administration
(7.5% of Grant)
$39,792 $24,564 N/A
Bay Area Community Services
(BACS)
Central Coast Center for
Independent Living (CCCIL)
SORT
Public Service $490,781 $441,428 384
Persons
(SORT)
SHARE Center Garden
*Includes funding from prior fiscal years
FY 2022-23 ESG-CV
Agency Funding
Category
Funding
Amount* Expenditures Outcomes
City of Salinas
Program
Administration
(10% of Grant)
$643,217 $77,602 N/A
City of Salinas
CCCIL
Community Homeless Solutions
Coalition of Homeless Services Providers
Downtown Streets Team, Inc.

Interim, Inc.

University Corporation at Monterey Bay
Bay Area Community Services
Public Service $4,545,985 $1,569,289 996
Households

FY 2022-23 HOME
Agency Funding Category Funding
Amount* Expenditures Outcomes
City of Salinas Program
Administration $418,036 $1 14,036 N/A
Monterey County Housing
Development Corporation Housing $1,017,540* $7,947 6
Housing Units
To be committed in the
future Housing $1,705,905 $0 TBD
Parkside Manor Proposed Development Parkside Manor Phase I Construction Parkside Manor Phase I Construction *Includes funding from prior fiscal years

FY 2022-23 HOME-ARP
Agency Funding Category Available
Funding Expenditures Outcome
City of Salinas Program
Administration $437,816.10 $0 N/A
Step up on Second Supportive
Services $2,480,957.90
$0 Households
CEQA Consideration
 The City of Salinas has determined that the proposed action is not a project as defined by the California Environmental Quality Act (CEQA) (CEQA Guidelines Section 15378).
 Economic Development
 Housing/Affordable Housing
 Effective and Culturally Responsive Government
 HUD provides Federal Funds directly to the City, therefore there is no impact to the General Fund.

Strategic Plan 2022-2025
Fiscal Impact
Recommendation
The Community Development Department (CDD)
recommends that the City Council adopt a Resolution
approving the FY 2022-23 CAPER and authorizing its
submittal to HUD.

City of Salinas
Legislation Text
200 Lincoln Ave., Salinas,
CA 93901
www.cityofsalinas.org
File #: ID#23-565, Version: 1
Audited Basic Financial Statements for the Year End June 30, 2022 Approve a Resolution approving the Audited Basic Financial Statements for Fiscal Year ended June 30, 2022.

City of Salinas Printed on 9/7/2023Page 1 of 1
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CITY OF SALINAS

COUNCIL STAFF REPORT

DATE: SEPTEMBER 12, 2023
DEPARTMENT: FINANCE
FROM: JIM PIA, ACTING FINANCE DIRECTOR
BY: ERIC BURL, ACCOUNTING MANAGER

THE PUN GROUP, LLP
TITLE: AUDITED BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2022

RECOMMENDED MOTION:

A motion to accept the audited Basic Financial Statements for fiscal year ended June 30, 2022.

RECOMMENDATION:

Staff recommends that City Council accept the audited Basic Financial Statements for fiscal year ended June 30, 2022.

DISCUSSION:

Audited Basic Financial Statements
The Finance Department is pleased to present the audited financial statements for the fiscal year ended June 30, 202 2. As noted in the Independent Auditor’s Report, the transmittal letter in the Basic Financial Statements provides an overview of the City’s financial activities for that fiscal year.

The PUN GROUP, LLP, the City’s independent auditor, has completed this annual audit of City Budget affairs. The financial s tatements are presented in conformity with generally accepted accounting principles (GAAP) and are audited in accordance with generally accepted auditing standards.

Page | 2

CEQA CONSIDERATION:

Not a Project. The City of Salinas has determined that the propos ed action is not a project as defined by the California Environmental Quality Act (CEQA) (CEQA Guidelines Section 15378).

STRATEGIC PLAN INITIATIVE:

The audited financial statements are part of upholding the Council Goal of Operational Efficiencies.

DEPARTMENTAL COORDINATION:

The audited financial statements represent the g ood work of the City’s Finance Department, and all departments working in the City.

FISCAL AND SUSTAINABILITY IMPACT:

Costs associated with the audit are included in the City’s FY 2022-23 and current year budgets.

Attachments
Basic Financial Statements (Draft) fiscal year ended June 30, 2022

CITY OF SALINAS,

CALIFORNIA
Basic Financial Statements
Fiscal Year Ended June 30, 2022

DRAFT 09.06.2023_v2
DRAFT 09.06.2023_v2
City of Salinas
Basic Financial Statements
For the Year Ended June 30, 2022

Table of Contents

Page

INTRODUCTORY SECTION

Letter of Transmittal ................................................................................................................................................... i List of City Officials .................................................................................................................................................. ii Organizational Chart ................................................................................................................................................. iii

FINANCIAL SECTION

Independent Auditors’ Report ................................................................................................................................ 1

Management’s Discussion and Analysis (Required Supplementary Information) (Unaudited) ....................... 5

Basic Financial Statements:

Government-Wide Financial Statements:

Statement of Net Position ..............................................................................................................................

Statement of Activities and Changes in Net Position ....................................................................................

Fund Financial Statements:

Governmental Funds:

Balance Sheet ..........................................................................................................................................

Reconciliation of the Governmental Funds Balance Sheet to the Government- Wide Statement of Net Position .......................................................................................................

Statement of Revenues, Expenditures, and Changes in Fund Balances ..................................................

Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Government-Wide Statement of Activities and Changes in Net Position ........................................................................................ ....

Proprietary Funds:

Statement of Net Position .......................................................................................................................

Statement of Revenues, Expenses, and Changes in Fund Net Position ..................................................

Statement of Cash Flows ....................................................................................................... .................

Fiduciary Funds:

Statement of Fiduciary Net Position .......................................................................................................

Statement of Changes in Fiduciary Net Position ....................................................................................

Notes to the Basic Financial Statements ...................................................................................................................

DRAFT 09.06.2023_v2
City of Salinas
Basic Financial Statements
For the Year Ended June 30, 2022

Table of Contents (Continued)

Page
FINANCIAL SECTION (Continued)

Required Supplementary Information (Unaudited):

Budgetary Information .........................................................................................................................................

Budgetary Comparison Schedules
General Fund .................................................................................................................................................

American Rescue Plan Act Special Revenue Fund .......................................................................................

Housing and Urban Development Grants Special Revenue Fund .................................................................

Schedule of Changes in Net Pension Liability and Related Ratios – Miscellaneous Plans .................................

Schedule of Pension Plan Contributions – Miscellaneous Plan ...........................................................................

Schedule of Changes in Net Pension Liability and Related Ratios – Safety Police Plans ...................................

Schedule of Pension Plan Contributions – Safety Police Plans ...........................................................................

Schedule of Proportionate Share of the Net Pension Liability – Safety Fire Plans .............................................

Schedule of Pension Plan Contributions – Safety Fire Plans ...............................................................................

Schedule of Changes in Net Pension Liability and Related Ratios – New York Life Plan .................................

Schedule of Pension Plan Contributions – New York Life Plan .........................................................................

Schedule of Changes in Net OPEB Liability and Related Ratios ........................................................................

Schedule of OPEB Contributions ........................................................................................................................

Supplementary Information:

Combining and Individual Fund Statements and Schedules:

Nonmajor Governmental Funds:

Combining Balance Sheet Nonmajor Governmental Funds ...................................................................

Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds ...............................................................................................................................

Nonmajor Special Revenue Funds:

Special Revenue Funds Header
Combining Balance Sheet Special Revenue Funds ................................................................................

Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Special Revenue Funds .......................................................................................................................................................

Nonmajor Debt Service Funds:

Debt Service Funds Header
Combining Balance Sheet Debt Service Funds ......................................................................................

Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Debt Service Funds .............................................................................................................................. ..................................

Nonmajor Capital Projects Funds:

Capital Projects Funds Header
Combining Balance Sheet Capital Projects Funds ..................................................................................

Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Capital Projects Funds .............................................................................................................................. ..................................

DRAFT 09.06.2023_v2
City of Salinas
Basic Financial Statements
For the Year Ended June 30, 2022

Table of Contents (Continued)

Page

FINANCIAL SECTION (Continued)

Supplementary Information (Continued):

Internal Service Funds:

Description of Internal Service Funds .....................................................................................................

Combining Statement of Net Position .....................................................................................................

Combining Statement of Revenues, Expenses, and
Changes in Net Position ..........................................................................................................................

Combining Statement of Cash Flows ......................................................................................................

Fiduciary Funds:

Description of Fiduciary Funds ...............................................................................................................

Private Purpose Trust Funds:

Combining Statement of Fiduciary Net Position ..............................................................................

Combining Statement of Changes in Fiduciary Net Position ...........................................................

Custodial Funds:

Combining Statement of Fiduciary Net Position .....................................................................................

Combining Statement of Changes in Fiduciary Net Position ..................................................................

Other Information (Unaudited):

General Fund:

Combining Balance Sheet – General, Measure E, & Measure G Funds ..........................................

Combining Statement of Revenues, Expenditures, and Changes in Fund Balance – General, Measure E, & Measure G Funds .....................................................................................................................

Budgetary Comparison Schedule - Measure E .................................................................................

Budgetary Comparison Schedule - Measure G

Claims Development – Internal Service Funds – General Liability Insurance ..............................................

Claims Development – Internal Service Funds – Workers Compensation Insurance ...................................

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Basic Financial Statements
Fiscal Year Ended June 30, 2022

PREPARED BY

THE FINANCE DEPARTMENT

Jim Pia
Assistant City Manager /
Acting Finance Director

Eric Burl, Accounting Manager

AUDITORS

The Pun Group LLP
Accountants & Advisors
200 E. Sandpointe Avenue, Suite 600
Santa Ana, CA 92707

DRAFT 09.06.2023_v2

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DRAFT 09.06.2023_v2

i
September 12, 2023

Honorable Mayor and Members of the City Council
City of Salinas, California

We are pleased to submit the City of Salinas (City) Basic Financial Statements for the fiscal year ended June 30, 2022. The financial statements are presented in conformity with generally accepted accounting principles (GAAP) and are audited in accordance with generally accepted auditing standards.

Responsibility for the accuracy of the data and th e fairness of presentation, including all notes and disclosures, rests with the City. We believe the data presented in this report is accurate in all material respects and all statements and disclosure s necessary for the reader to obtain a thorough understanding of the City’s financial activities ha ve been included. Management of the City 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 GAAP. Because the cost of internal controls should not outweigh their bene fits, the City’s comprehensive framework of internal controls has been designed to provide re asonable rather than abso lute assurance that the financial statements will be free from material misstatements.

While traditionally addressed to the governing body of the City, this report is intended to provide relevant financial information to the residents of the City of Salinas, City staff, creditors, investors and other concerned readers. We encourage all readers to contact the Finance Department with any questions or comments concerning this report.

The Pun Group LLP, a firm of certified public acc ountants, have audited the City’s financial statements. The goal of the independent audit was to provide reasonable assurance that the financial statements of the City for the fiscal year ended June 30, 2022, are free of material misstatements. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Based upon the audit, the independen t auditors concluded that there was reasonable basis for rendering an unmodified opinion that the City’s financial statements for the fiscal year ended June 30, 2022, are fairly presented in conformity with GAAP. The independent auditor’s report is presented as the first component of the financial section of this report.

DRAFT 09.06.2023_v2

ii
The independent audit of the financial statements of the City was part of a broader, federally mandated “Single Au dit” designed to meet the special ne eds of federal grantor agencies. The standards governing Single Audit engagements require the independent auditor to report not only on fair presentation of the financial statements, but also on the government’s internal controls and compliance with legal requirements, with spec ial emphasis on internal controls and legal requirements involv ing the administratio n of federal awards. These reports are available in the City’s separately issued Single Audit Report.

GAAP requires that management provide a narrat ive introduction, overview, and analysis to accompany the basic 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 it. The City’s MD&A can be found immediately following the report of the independent auditors.

This report is divided into two sections:

 The Introductory Section includes this letter of transmittal and an organizational overview of the City government.
 The Financial Section consists of the independent auditors’ report, Management’s Discussion and Analysis, and the Basic Financial Statements; which include the Government- Wide Financial Statements, Fund Financial Statements, Notes to Financial Statements, Required Supplementary Information and other Supplementary Information.

The Reporting Entity and Its Services

In defining the reporting entity, there are no other governmental units over which the City Council has financial accountability. Under new state law, the Salinas Redevelopment Agency, which was a component unit of the City, ceased to exist as of February 1, 2012, and therefore the assets and activities of the dissolved redevelopment agency are reported in a Fiduciary Fund (private purpose trust fund) in the financial statements of the City.

The City of Salinas was incorporated as a charter City on March 4, 1874 and operates under the Council-Manager form of government. The City is governed by a six-member Council elected by districts for four-year alternating terms and a Mayor elected at large for a two-year term. The Council appoints the City Attorney and the City Manager, who is responsible for day-to-day administration of the City under the policy direction of the Council.

The City of Salinas is the “county seat” of Monterey County and is located in the Central Coast region of California, 17 miles inland from the Monterey Bay, 325 miles north of Los Angeles and 106 miles south of San Francisco. Salinas is a charter City providing all typi cal City services:

Public safety - police a nd fire, Public Works - maintenance services (streets, lighting, signals, facilities, parks and trees), development and perm it services, current an d advanced planning and traffic and facilities engineer ing, Library, Recreation and Gene ral administrative services.

Business-type City services in clude: a Municipal Airport, I ndustrial Waste sy stem, Sanitary Sewer, Water Utility and a Parking District. The State Department of Finance reports the City’s population at 162,222 as of January 1, 2020. The City FY 2021-22 budget includes 606.50 positions authorized on a full-time equivalent basis.

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iii
Three elementary school districts, a unified high school district and several private schools at both the primary and secondary level operate in the City of Salinas. Hartnell College, a State Community College, offers two-year degrees and occupational certificate programs. California State University, Monterey Bay is located less than 15 miles away on the former Fort Ord site.

Graduate studies through Golden Gate University , Monterey Institute of International Studies and Chapman College are available nearby. Also in the area are Moss Landing Marine Laboratory, Monterey College of Law, Stanford University’s Hopkins Marine Station and San Jose State University.

Salinas has extensive health and medical services with two of Monterey County's four hospitals located within the City. Salinas also offers skilled nursing and convalescent homes and residential retirement facilities for seniors, as well as over 220 practicing physicians.

Fire protection and basic and adva nced life support are provided by the City's full-service Fire Department. Advanced life support services are provided by the Fire Department’s paramedic program. The City of Salinas has a Police Department and receives additional support, as required, from the Monterey County Sheriff's Office and other regional, state and federal agencies.

The City's moderate climate encourages year-round use of its 550 plus acres of municipal parks, which include golf courses, tennis courts a nd swimming pools. The Salinas Community Center regularly hosts symphonies, ballets, concerts and conventions. Salinas is host to the annual Steinbeck Festival, the California Rodeo, and the California International Airshow. Salinas has a modern California Sports Complex and the Na tional Steinbeck Center. Surrounding Salinas are diverse recreational opportunities including beauti ful beaches and the world famed golf courses of the Monterey Bay Peninsula.

As the retail hub of the Central Co ast, Salinas enjoys a wide selection and diversity in its stores.

Northridge Shopping Center contains over 120 specialty shops and four major department stores – Macy’s, Sears, Best Buy and J.C. Penney. Harden Ranch Plaza includes Wal-Mart, Target, Safeway, specialty stores, restaurants, and bank ing institutions. The Westridge Shopping Center is home to Costco, Wal-Mart, Office Max, Dick’s Sporting Goods and a variety of national chain restaurants. The Salinas Auto Center houses nine local dealers and its retail area hosts Home Depot, Beverages and More (BevMo ), Kohl’s, and other specialty stores. Additionally, Salinas' location allows quick access to the Monterey Peninsula, as well as the San Jose area.

The City utilizes various Boards and Commissions in the conduct of its affairs. Commissions and Committees established by City Ordinance are:
 Airport Commission
 Library and Community Services Commission
 Traffic and Transportation Commission
 Planning Commission
 Measure G Oversight Committee
 Measure E Oversight Committee

Boards and Committees established by Resolution of the City Council are:

 Police Community Advisory Committee
 Animal Services Committee
DRAFT 09.06.2023_v2

iv
 Design Review Board
 Board of Appeals
 Grievance Advisory Board
 Finance Committee
 Historical Resources Board

FINANCIAL INFORMATION

The City’s management staff is responsible for establishing and maintaining internal controls that safeguard the assets of the government from loss, theft, or misuse and allow the compilation of adequate accounting data for the preparation of financial st atements in conformity with Generally Accepted Accounting Principles (GAAP). Internal controls are designed to provide reasonable, but not absolute, assurance that thes e objectives are met. The concept of reasonable assurance recognizes that the cost of a control should not exceed its likely benefits and that the evaluation of costs and benefits is subject to management estimates and judgments.

Single Audit

As a recipient of Federal, State and County fina ncial assistance, the City is responsible for providing assurance that adequate internal cont rols are in place to ensure compliance with applicable laws and regulations relating to these award programs. Internal controls are subject to periodic evaluation by management, the Finan ce Department staff, and the City's outside independent auditors.

As part of the City's single a udit procedures, tests are performed to determine the effectiveness of the internal controls over major Federal award programs and the City’s compliance with applicable laws and regulations related to these award programs.

Accounting System and Budgetary Control

The City's accounting and budgeting records for ge neral governmental operations are maintained on a modified accrual basis, with the revenues being recorded when available and measurable.

Expenditures are recorded when the services or goods are received or the liabilities incurred.

Accounting and budgeting for the City's proprietary funds are maintained on the accrual basis.

The City also uses encumbrance accounting as another technique for accomplishing budgetary control. An encumbrance is a commitment of a future expenditure earmarked for a particular purpose that reduces the amount of budgetary authority available for general spending. At the end of the fiscal year, encumbered appropriations are carried forward and become part of the following year's budget while appropriations th at have not been encumbered lapse and are available to be appropriated through the following fiscal year’s budget process.

The City Council approves operating appropriations at the department and fund level prior to July 1, each year and may amend the budget during th e fiscal year. Please refer to Required Supplementary Information to the financial statements for a more detailed discussion of budget policy and control. The City continues to meet its responsibility for sound financial management as demonstrated by the statements and schedules included in the financial section of this report.

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Annual Financial Report

The purpose of the City's Annual Financial Repor t is to summarize the administrative and operational performance of the City during the previous fiscal year. The repo rt is intended to highlight significant accomplishments that were achieved during the fiscal year ended June 30, 2022 and to provide a financial analysis of City performance.

Capital Assets and Depreciation

As of June 30, 2022, capital assets, in cluding infrastructure assets, of the City of Salinas totaled $862.2 million; accumulated depreciation totaled $454.9 million, with the difference providing net capital assets of $407.2 million. Net capital assets of the City’s governmental activities (general government) are $335.0 million and net capital assets for the City’s business-type activities (enterprise funds) are $72.2 million.

Capital assets include land, buildings, infrastructure (streets, curbs, gutters, sidewalks, bridges, streetlights, traffic signals, etc.), improvements other than buildings (park improvements, etc.), and machinery and equipment.

During FY 2021-22, depreciation expense on capital assets of the City’s governmental activities (general government) was $12.9 million and depreciation expense on capital assets of the City’s business-type activities (enterprise funds) was $3.6 million. Depreciation e xpense represents the amount at which assets are bei ng used-up annually. Due to budget c onstraints over the years, the City has been unable to invest in the maintenance of capital assets at anywhere near the annual depreciation amount.

Please refer to the Notes to Basic Financial Statements, Note 11 for a complete discussion of the City’s Capital Assets.

Long-term Debt Payable

At June 30, 2022, the City had $154.8 million in long-term debt. Long-term debt includes capital leases and notes and bonds payable. While the Ge neral Fund guarantees most of the City’s long- term debt, other funds, agencies or property owners make the majority of principal and interest payments. Examples of other funds, agencies or property owners include, the Industrial Waste Fund, Golf Courses Fund, the Sani tary Sewer Fund, Successor Agency to the former Salinas Redevelopment Agency property tax increments, and payments from property owners who are included in the City’s various assessment districts.

Please refer to the Notes to Basic Financial Statements, Note 13, for a complete discussion of the City’s Long-term Debt.

Fund Financial Statements-General Governmental Revenues

The current governmental operations of the City are accounted for in the General, Special Revenue, Debt Service, and Capital Project Funds. For th e fiscal year ended Ju ne 30, 2022, total revenues for general governmental functions totaled $214.4 million, an increase of 12.0% over the previous fiscal year.

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Sales Tax

The City has a well-diversified economy and sales tax base. The sales and transaction and use tax increased $8.2 million, or 10.2% from FY 2020-21. The increase can be attributed to the recovery from the COVID-19 pandemic and the effects it ha d on the economy. Sales tax was the largest single category of revenue this fiscal year producing 17.7% of the combin ed governmental fund type revenues. Transactions and Use Tax (Measures E and G) represents 23.6% of the combined governmental fund type revenues. Measures E and G transactions and use tax is a general tax and is reported as part of the General Fund. Combined, sales tax and transactions and use tax revenue total $88.5 million or 41.3% of the combined governmental fund type revenues.

On November 8, 2005, the voters of Salinas appr oved Measure V, a 0.50% transactions and use tax. On November 6, 2012, the voters of Salinas approved to extend the 0.50% transaction and use tax with no sunset (Measure E). Measure E is a ge neral tax and is reported as part of the General Fund, although the tax is accounted for in a separate sub-fund of the General Fund.

On November 4, 2014, the voters of Salinas ap proved Measure G, an ordinance imposing a one- cent general transactions and use tax. Measure G has a fifteen-yea r term and requires the City Council to establish an Oversight Committee. Measure G is a genera l tax and is reported as part of the General Fund, although the tax is accounted for in a separate sub-fund of the General Fund.

-
10 20
30 40
50 60
70 80
90 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
$34.0 $35.4
$42.0
$62.0 $64.6 $64.9
$72.9 $69.7
$80.3
$88.5
Millions
Fiscal Year
Sales and Measures E & G Tax
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Intergovernmental

Intergovernmental revenue was the second largest single category of revenue during the fiscal year producing 20.3% of the combined governmental fund revenues. Intergovernmental revenues consist of vehicle licenses fees (1/3 of VLF) , Federal and State Public Safety Funds, Federal Block Grants, State Gas Taxes and Federal and State Construc tion Grants. Intergovernmental revenue recovered from a 10-year low nine years ago. Intergovernmental revenue had an increase from the prior year of $12.1 million, or 38.5%, mainly from increased Federal funding for the pandemic.

Property Tax

Property tax revenue was the thir d largest source of revenue du ring this fiscal year, producing

16.0% of the combined governmental fund type revenues. Property tax revenue includes Property tax-in-lieu of vehicle license fees (2/3 of VLF) of $14.8 million that is now determined by the City’s growth in assessed property values. Pr operty tax experienced a low in 2012 of $21.5 million and is now $34.4 million.

-
10 20
30 40
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
$14.8
$20.1
$17.2 $17.2 $17.4
$24.5
$19.1
$21.3
$31.4
$43.5
Millions
Fiscal Year
Intergovernmental
-
10 20
30 40
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
$21.7 $23.1 $24.4 $25.9 $27.0 $28.5 $30.1 $31.1 $33.2 $34.4 Millions
Fiscal Year
Property Tax
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Utility User’s Tax and Other Taxes

Utility user’s tax and other taxes produced 10.9% of the combined governmental fund type revenues. Other taxes include business license tax and franchise fees, among others. Utility user’s tax increased $0.4 million from the prior year, or 3.8%. Other taxes decreased from the prior year to $11.5 million.

Assessment District Taxes

The Assessment District Debt Service Fund taxes increased by 2.0 million to $0.7 million.

Charges for Services

The Charges for Services revenue increased by $0.9 mil lion, or 13.5% as a re sult of services returning to the pre-COVID-19 pandemic levels.

Revenues from various sources and the resulting changes over the last year are shown below.

2022 Percent 2021
Source of Revenues Am ounts of Total Am ounts Dollars Percent Taxes - Special Assessments 749,723$ 0.3% 2,774,645$ (2,024,922)$ -73.0% Property tax 34,350,884 16.0% 33,234,237 1,116,647 3.4% Sales/transaction & use tax 88,460,979 41.3% 80,275,160 8,185,819 10.2% Utility user's tax 12,106,526 5.6% 11,664,913 441,613 3.8% Other taxes 11,452,945 5.3% 19,869,125 (8,416,180) -42.4% License & permits 11,655,858 5.4% 812,083 10,843,775 1335.3% Intergovernmental 43,503,917 20.3% 31,404,757 12,099,160 38.5% Charges for service 7,779,989 3.6% 6,854,066 925,923 13.5% Interest (2,221,283) -1.0% 673,582 (2,894,865) -429.8% Rental income 597,016 0.3% 927,623 (330,607) -35.6% Fines/forfeitures 736,590 0.3% 623,400 113,190 18.2% Miscellaneous 5,205,563 2.4% 2,243,489 2,962,074 132.0% TOTAL 214,378,707$ 99.8% 191,357,080$ 23,021,627$ 12.0% 2022 vs. 2021
Increase/(decrease)
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Fund Financial Statements-Genera l Governmental Expenditures

Expenditures for governmental operations durin g the fiscal year ended June 30, 2022 were $198.3 million, a net increase of 3.9% in total expenditures over the previous year.

Changes in expenditures by major function are as follows:

Percent
of
Function 2022 Total 2021 Dollars Percent
General government 41,058,542$ 20.7% 39,992,586$ 1,065,956$ 2.7% Public safety 86,257,361 43.5% 82,842,431 3,414,930 4.1% Public works 21,406,979 10.8% 18,892,966 2,514,013 13.3% Recreation 6,203,379 3.1% 2,935,550 3,267,829 111.3% Library 4,759,516 2.4% 4,363,997 395,519 9.1% Subtotal operations 159,685,777 80.5% 149,027,530 10,658,247 7.2% Capital outlay 18,038,903 9.1% 29,525,238 (11,486,335) -38.9% Debt service:

Principal 15,149,780 7.6% 6,465,528 8,684,252 134.3% Interest 5,474,806 2.8% 5,951,232 (476,426) -8.0% Total 198,349,266$ 100.0% 190,969,528$ 7,379,738$ 3.9% 2022 vs. 2021
Increase/(decrease)
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For the fiscal year ended June 30, 2022, total e xpenditures for general governmental functions totaled $198.3 million, an increase of 3.9% over the previous fiscal year.

General Government increased by $1.1 million, or 2.7%. Recreation increased by $3.3 million, or 111.3%, Public Safety increased by $3.4 million, or 4.1%, Public Works increased by $2.5 million, or 13.3%, and Library expenditures increased by $0.4 million, or 9.1%.

Principal payments increased by $8.7 million while interest payments decreased by $0.5 million, mostly due to a large pay down of the Police Services Building debt in the current year.

Capital Outlay (Project) expenditures decreased $11.5 million or 38.9% from $29.5 million in FY 2020-21 to $18.0 million in FY 2021-22. During th e year, there were 128 capital projects worked on. The largest project was the Bardin Rd. Safe Route to School with $5.9 million spent in 2022. The second largest project was $4.6 million spent on the East Lake Street Sewer Repairs.

The third and fourth largest projects were $2.7 and $1.7 million on the E. Laurel Dr. Sidewalk and Lights and the Industrial Waste Treatment Facility Repairs projects, respectively.

Business-type Activities-Enterprise Funds

Enterprise Funds are the City’s business-type acti vities (activities supported, at least in part, by fees or charges) and include the Salinas Munici pal Airport, the Industrial Waste Facility, the Sanitary Sewer System, the Parking District, and Permit Services.

The Enterprise Fund’s net position totaled $56.2 million at June 30, 2022.

$-
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
$80.0
$90.0
$100.0
Public safety General govt. Capital outlay Public works Debt service Recreation Library General Governmental Expenditures
2022 vs. 2021
2022
2021$ Millions
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Internal Service Funds

Internal Service Funds are used to account for the City’s fleet maintenance program and risk management program which administers employee benefits and the City’s insurance programs including; 1) General Insurances-employee assi stance program, unemployment claims, biennial physical exams and property insurance; 2) Work ers’ Compensation self-insurance program; and 3) General Liability self-insurance program.

At June 30, 2022, the Internal Service Funds liabilities for estimated claims payable totaled $29.7 million, with $25.3 million representing Workers’ Compensation and $4.3 million representing General Liability.

Total Workers’ Compensation insu rance claims liabilities are $27.0 million at June 30, 2022. A portion of the liability is reported in the Internal Service Fund ($25.3 million) and a portion is treated as long-term debt ($1.6 million). The long-t erm debt portion represents future obligations of the Workers’ Compensation Plan.

Fiduciary Funds

Fiduciary Funds are used to account for assets he ld in trust for others and cannot be used for general government purposes. The City maintains the following Fiduciary Funds: Private Purpose Trust Funds, Pension Trust Funds and Custodial Funds.

Private Purpose Trust Funds include a net position of $1.0 million held by the City, which increased by $0.1 million from the prior year. Of the net position, $0.4 million is held by the City for the dissolved Redevelopment Agency, which is accounted for in the Successor Agency Trust, and a net position of $0.6 million held by the City for Comm unity Center and Sherwood Hall activities, Monterey One Water Fees, Sales Tax, Payroll Taxes, Deposits, Construction Bonds and other trust arrangements not properly reported in a pension trust.

Pension Trust Funds held by the City of $13.6 million are employee deferred compensation funds.

Custodial Funds are assets held by the City for Economic Development, Salinas Valley Enterprise Zone, Employee Cafeteria Plan and Retired Employees Health Insurance Program. Agency assets held by the City total $0.0 million ($22,012).

Cash Management

In accordance with the provisions of Califo rnia Government Code Section 53600 et. seq., the City is restricted to certain types of legal investments. These investments are included in the City’s investment policy and ar e approved by City Council annua lly. In addition, the City’s investment activity is reporte d to the City Council monthly pursuant to the California Government Code.

The City invests all idle funds daily. The cash ma nagement system of the City is designed to monitor revenues and expenditures to ensure the investment of monies to the fullest extent possible. The criteria, in order of priority, fo r selecting investments are safety, liquidity, and yield.

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The City’s investment in certificates of deposit and investment contracts are reported at cost, which is fair value. While recorded at fair market value in the financial statements, the City’s investments are redeemable at 100% of cost.

Please refer to Note 3 for a complete discussion of the City’s Cash and Investments.

The City’s cash and investments at June 30, 2022 is as follows:

Property Assessment

Assessed valuation of citywide taxable pr operties increased $415.2 million to $13,051 million representing an increase of 3.3% over FY 2020-21.

The following table summarizes the growth and declines in assessed valuation.

Cash and Cash Equivalents:

Cash on hand 25,000$
Dem and accounts at banks 6,260,469
Money market 16,073,619
Deposits held in trust by fiscal agent 217,200
Money m arket held in trust by fiscal agent -
Local Agency Investment Fund 89,354,488
Total cash and cash equivalents 111,930,776
Investm ents:

Investments held by fiscal agent 137,056,490
Deferred compensation 4,354,495
Total investments 141,410,985
Total cash and investments 253,341,761$
Before Redevelopment After Redevelopment Percent
Increment Increment Change
13,051,285,928$ 12,029,666,454 $ 3.29% 12,636,068,210 11,642,994,299 4.60% 12,080,694,193 11,139,610,620 5.41% 11,460,172,316 10,579,785,927 5.02% 10,912,115,449 10,071,741,861 4.70% 10,422,521,577 9,614,776,155 4.60% 9,963,782,622 9,195,146,472 6.49% 9,356,177,997 8,629,207,052 8.82% 8,597,836,189 7,904,316,402 2.72% 8,370,116,351 7,693,329,440 0.72% 8,310,478,479 7,628,550,860 -0.61% 8,361,701,633 7,473,844,928 -6.75% 8,966,761,801 7,981,760,147 -11.25% 10,102,973,741 9,158,540,984 -5.10% 10,645,974,648 9,750,295,032 7.25% 9,926,023,729 9,107,918,547 12.72% 8,806,009,783 8,305,434,488 12.90% 7,799,653,100 7,373,407,370 10.70% 7,045,521,979 6,643,698,145 6.90% 2012-13
Fiscal year
2019-20
2003-04
2004-05
2005-06
2014-15
2018-19
2017-18
2016-17
2015-16
2013-14
2006-07
2020-21
2021-22
2007-08
2008-09
2009-10
2010-11
2011-12
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Significant Events and Accomplishments

Through the leadership of the City Council and th e City Manager, the city continues to produce amazing accomplishments. The C ity Council is committed to st rategic goals, which guide the initiatives and activities of each City department. The following is a list of accomplishments during the year for each department:

 City Attorney Department

1. Support Efforts to Generate Revenue Sources to Invest in Existing Facilities and Infrastructure. (Infrastructure and Environmental Sustainability) a. Advise on transactional support and fee/ finance issues related to additional investment in existing facilities and infrastructure.
b. Advise on procurement and contracting for American Rescue Plan Act (ARPA) funded projects.

2. Support Efforts to Fund Storm Water Pr ogram and Additional Taxes and Fees. (Infrastructure and Environmental Sustainability)
a. Advise on and support efforts to establish new and additional fees and taxes to fund the City’s storm water management progr am and maintenance of City parks and recreation facilities.

3. Municipal Code Update. (Effective and Culturally Responsive Government; Infrastructure and Environmental Sustainability)
a. Complete update of the M unicipal Code to identify a nd to update self-imposed regulations that hinder operational efficiencies.
a. Update purchasing policies and purchasing manual, to include an environmentally friendly purchasing requirement.
b. Support efforts to establish a Youth Commission. (Youth and Seniors)

4. Cost-Recovery Program. (Effective and Culturally Responsive Government) a. Continue to implement and manage a cost-recovery program so the City can recover its costs and can recover for damaged property.

5. Employment/Human Resources. (Effective and Culturally Responsive Government) a. Continue to review and to update pers onnel policies, as n eeded. Continue to participate in and advise on employee issues during continued negotiations with the remaining bargaining groups.

6. Civil Litigation. (Effective and Culturally Responsive Government) a. Continue to manage the bulk of civil litigation in-house, with less reliance on outside counsel, except for some unique and particularly specialized cases. b. Work to resolve North of Boronda Future Growth Area-related litigation to facilitate development of new housing. (Housing/Affordable Housing)

7. Prosecution of Municipal Code Violations. (Public Safety) a. Continue
to prosecute misdemeanor violations of the Salinas Municipal Code.

8. Continue to address workers’ compensation costs, continue moving toward sound actuarial funding. (Effective and Culturally Responsive Government) a. Reduce general fund costs in management and administration of general liability and workers compensation programs.
b. Identify workers’ compensation cases which are eligible for early resolution. c. Develop and implement a City-wide Safety Training Program; participate in Safety Committee meetings.

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d. Assist with coordination of early Return to Work for Industrial and Non-industrial Injuries.
e. Annually audit workers’ compensation thir d party administrato r’s performance in managing claims and liabilities.
f. Review and update actuarial data in wo rkers’ compensation program to ensure adequate funding and reduction in outstanding accrued liability.

 Community Development Department

1. Continue to implement the Alisal Vibrancy Plan including greening, litter abatement and public art/district identity improvements and the adoptio n of commercial corridor guidelines and a district identity plan. (Strategic Goal: Economic Development)

2. Continue to support small businesses through business navigation, loans, and connection to small business resources. (Strategic Goal: Economic Development)

3. Work with developers to entitle the Ferrasc i Business Center Specific Plan (Target Area K) which will provide new employment and revenue generating opportunities. (Strategic Goal: Economic Development)

4. Evaluate the tax and regulatory environment for commercial cannabis and make data informed recommendations to City Council on improvements to the Commercial Cannabis Ordinance, tax rates, and permitting process to stabilize the industry in Salinas. (Strategic Goal: Economic Development)

5. Continue to work with th e community, food vendors, and nonprofits to expand healthy foods choice and explore entrepreneurship opportunities such as new farmer’s markets, food truck pods, development of a commun ity/commercial kitchen, and community gardens. (Strategic Goal: Economic Development)

6. Coordinate with the County on the implementation of the Downtown Vibrancy and Alisal Vibrancy Plans to include undertaking planning activities for a downtown parking facility and city and county properties around the Division Street Oppor tunity site in the Alisal. (Strategic Goals: Economic Development and Housing/Affordable Housing)

7. Complete the entitlement process for a vibr ant, multi-phase new mixed-use development at the corner of Abbott and John Street to include a 111-room hotel, 242 dwelling units, 107,900 sq ft of retail, and 30,900 sq ft of office. (Strategic Goals: Economic Development and Housing/Affordable Housing)

8. Proactively engage developers and leverage American Rescue Plan Act (ARPA) funding of $7 million and other housing resources to incentivize and promote the production of
low- and moderate-income housing for families, workforce, includi ng farmworkers, and seniors. (Strategic Goal: Housing/Affordable Housing)

9. Launch preparation of the East Area Speci fic Plan to increase housing development opportunities and create healthy, walkable and sustainable neighborhoods. (Strategic Goal:

Housing/Affordable Housing)
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10. Continue to partner w ith the County of Monterey to deve lop an affordable multi-family housing project at 855 E. Laurel Drive. (Strategic Goal: Housing/Affordable Housing)

11. Continue to effectively operate an ARPA funded interim housing Motel Program in support of City Health & Safety Days and other emerging City initiatives and priorities. (Strategic Goal: Housing/Affordable Housing)

12. Effectively use SB2 grant funds to facilitate zone changes to mixed-use to increase housing development opportunities in the downtown, North and East Salinas. (Strategic Goal:

Housing/Affordable Housing)

13. Support the continued rehabilitation and fu ll occupancy of 202 un its of affordable, permanent supportive housing at awar ded HCD Homekey project sites. (Strategic Goal:

Housing/Affordable Housing)

14. Continue to promote ADU development by completing pre-approved ADU plans, streamlining approval processes, updating regu lations consistent with State law, and connecting applicants to financing. (Strategic Goal: Housing/Affordable Housing)

15. Facilitate the development of the Future Growth Area (FGA) by coordinating infrastructure investment and processing tentative map applications as quickly as possible. (Strategic Goal: Housing/Affordable Housing)

16. Initiate public engagement to facilitate the preparation of the City’s first Climate Action Plan (CAP). (Strategic Goal: Infrastructure and Environmental Sustainability)

17. Establish a rental registration program to pr omote the life safety of housing units and provide tenant/landlord suppor t to stabilize Sa linas’ housing stock and promote housing preservation. (Strategic Goals: Public Safety and Housing/Affordable Housing)

18. Improve code enforcement outcomes by coor dinating with Fire Prevention, Police Department, Public Works, Monterey Count y Environmental Health, Republic Services, and Homeless Service Providers to address blig hted properties and qual ity of life issues such as noise complaints. (Strategic Goal: Public Safety)

19. Increase inspection warrants and continue to implement administrative and legal remedies
in gaining compliance on nuisance properties th at may have health and safety dangers. (Strategic Goal: Public Safety)

20. Coordinate with Public Works and the Mont erey County Health Department in working with vendors to comply with the City’s vendor regulations and to improve health compliance related to food vending. (Strategic Goal: Public Safety)

21. Continue to expand community engagement opportunities and education to encourage compliance with City codes. (Strategic Goal: Public Safety)

22. Assist in providing funding to organizations in the areas of substance abuse and youth violence prevention. (Strategic Goal: Public Safety)
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23. Effectively implement the Cal ICH Encampmen t Resolution Grant using ‘Housing First’ best practices to provide unhoused residents with viable pathways to housing and to allow for the restoration of form er encampments sites to their intended public use. (Strategic Goal: Public Safety)

24. Coordinate with Library and Community Services and Public Works to implement park and recreational facility improvements includi ng the design and construction of a new Hebbron Family Center to implement the Alisal Vibrancy Plan. (Strategic Goal: Youth and Seniors)

25. Complete the final phase of rehabilitation of the Sherwood Recreati on Center project in collaboration with Library and Community Services. (Strategic Goal: Youth and Seniors)

26. Continue to engage and collaborate with Salinas’ residents and stakeholders to ensure the incorporation of equity in the prep aration of the General Plan Update. (Strategic Goal:

Effective and Culturally Responsive Government)

27. Implement technology improvements at the Permit Center to faci litate the processing of construction permits via Project/Dox/OAS, a paperless system. (Strategic Goal: Effective and Culturally Responsive Government)

28. Increase virtual building inspections by 50% over the next fiscal year. (Strategic Goal:

Effective and Culturally Responsive Government)

29. Implement a customer satisfaction survey to guide Permit Center Improvements (Strategic Goal: Effective and Culturally Responsive Government)

30. Optimize the land use management system – TRAKiT to facilitate data exchange and avoid duplicative entry to improve Permit Center productivity. (Strategic Goal: Effective and Culturally Responsive Government)

 Finance Department

1. Worked collaboratively with departments to balance the fiscal year budget.

2. Implemented group budgeting, wh ich reduces the number of appropriation (i.e., expenditure budget) adjustment s necessary by allowing expenses within a department’s individual accounts within a fund to be exceeded provided the department’s overall appropriation in the same fund is not, a nd zero-based budgeting, which requires that budgeting begin with $0 in appropriations assumed. Together, thes e practices prevent budget “bloat,” inflated appr opriations which result from ca rrying forward appropriation amounts year after year without consideration for whether they are necessary.

3. Amended the City’s financial policies, establishing and fundi ng several new reserves to better position the City able to withstand fi nancial emergencies and to make decisions strategically
, rather than financially, and establishing minimum targets for annual infrastructure and facilities maintenance appropriations.

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4. Completed the annual audited financial statements and Single Audit of Federally Assisted Grant Programs (Single Audit), receiving unmodified auditor’s opini ons/reports (i.e., opinions/reports wherein the auditor has conc luded that the financial statements are presented fairly, in all material respects, in accordance with the applicable financial reporting framework).

5. Secured American Rescue Plan Act Funds of $51.6 million for the City of Salinas.

6. Improved the calculation of available fund balances.

7. Acquired professional investment management and advisory services consultant, which is expected to significantly increase the City’s investment returns.

8. Acquired property tax services consultant, whic h will assist the City in preparing more accurate property tax revenue projections, provide assessed value and revenue information for secured and unsecured properties in the City, and perform analysis to identify errors in misallocation of property taxes.

9. Completed Technology Current State Assessment and Technology Master Plan.

10. Develop training and educational plans to impr ove help desk “first call” resolution and improve support services across the City.

11. Established Unclaimed Monies webpage wher e outstanding (uncashed) checks issued by the City may be found along with instructions for submitting claims.

12. Supported labor negotiations with labor costing and budgetary/financial updates.

 Fire Department

1. Grants- The Fire Department applied for and was awarded a grant from the Federal Urban Area Security Initiative (UASI) in the amount of $162,000 to upgrade the technology in the City’s Mobile Command and Communicatio ns Vehicle (MCCV). The vehicle was procured in 2008 with State Homeland Security Grant Program (SHSGP) funding and is in need of upgrades to its’ tec hnology systems. This award assu res the serviceability of this valuable resource for many years to come.

Assistance to Firefighters Grant (AFG) - The fire department was rewarded this unique grant for a second year in a row. In cooperation with the City of Monterey Fire Department, this grant provides funding up to $800,000 for existing SFD fire fighters to attend paramedic and offset the associated staffing costs.

2. Recruitment and Hiring - The Fire Depar tment successfully hired and completed an academy of 8 lateral firefighter transfers from neighboring fire departments. This helped the department to hire local candidates and reduce some of the costs associated recruitment and training of personnel with existing firefighting experience.

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Fire department administration was successful in partnering with the South Bay Regional Training Consortium, Hartnell College and Mont erey Peninsula College in establishing a local Paramedic training pr ogram. This program administ ered through the community college system will provide the opportunity fo r local students to obtain this valuable training and will allow local departments to tr ain existing staff to th e advanced level of Paramedic.

SFD has partnered with the Mi ssion Trails Regional Occ upational Program (MTROP) to attract and train local youth for a career of service with the City of Salinas Fire Department.

This supports the City Council’s strategic goal of local recruitment and diversity in the City’s workforce.

3. Emergency Medical Services – Amidst the global pandemic Salinas firefighters responded to several thousand COVID-19 related emergency responses without drastic impacts to continuity of services. The division took a lead role in establ ishing city-wide COVID guidelines and best practices for all City depa rtments and participated in local and State efforts to provide vaccinations and education.

4. Promotional Exams –The Fire Department ha s completed numerous internal promotions to fill vacancies in various ranks, including Battalion Chie f, Fire Captain, and Fire Engineer.

5. Fire Prevention Division – The division was able to fill its’ 3rd vacancy in the full-time Fire Inspector position and is curren tly recruiting to fill vacancies in part-time positions. The division received Council approval to proceed with a re-classificati on/re-organization of inspection personnel to further improve the ef ficiency and accountability of inspections and help with recruitment and re tention of staff. The division has eliminated nearly all of the pandemic-related back-log of inspections.

6. Operations/Suppression -The Fi re Department took delivery of two new fire apparatus.

These new fire engines will replace aged equi pment at fire station #1 on West Alisal St. and fire station #6 on East Bolivar St.as part of the department’s vehicle replacement program.

7. Facilities- Fire station #1 on Wes t Alisal received a much need ed new roof that will help extend the longevity of this facility and greatly improved the visual for the neighborhood.

Additionally, the Council approv ed improvements to the west wing of City Hall have commenced and are anticipated to be completed by the new FY. The improvements to the west wing will combine the fire administratio n and prevention offices into one space and allows for efficiencies in supervision of staff, efficiencies in customer service, provides ample workspace for fire department adminis trative and prevention personnel. It also provides for training facilities that can also serve as the City’s Emergency Operations Center (EOC) in times of crisis . Office spaces vacated in the permit center will allow for expansion of community development programs, services, and staffing as well.

8. Wellness/Safety – The Departme nt has bolstered its’ training and resource availability in the areas of mental health and critical inci dent stress reduction. Several members of the department have received specific training in Critical Incident Stress Management (CISM) as part of a broader national initiative to reduce mental health impacts on public safety personnel. The department has engaged with additional specialized counseling resources to augment and improve existing programs.

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 Human Resources Department

1. Work collaboratively with Departments to administer the personnel recruitment and in- service training programs for City personnel (Strategic Goal: Effective and Culturally Responsive Government)

2. Administer the City’s classification and compensation plans consistent with the Personnel Ordinance and Resolution (Strategic Go al: Effective and Culturally Responsive Government)

3. Continue streamlining hiring and employee onboarding (Strategic Goal: Public Safety and Effective and Culturally Responsive Government)

4. Continue ongoing collaboration with implementation of the Salinas Plan (Strategic Goal:

Public Safety and Effective and Culturally Responsive Government)

5. Continue efforts on Blue Zone worksite designation (Strategic Goal: Effective and Culturally Responsive Government)

6. Streamline payroll for public sa fety - integration into New World ERP (Strategic Goal:

Effective and Culturally Responsive Government)

7. Implement online performance evaluation module (Strategic Goal: Effective and Culturally Responsive Government)

8. Oversee the City’s employer-employee rela tions matters with recognized employee organizations on matters within the scope of representation pursuant to Municipal Code (Strategic Goal: Effective and Culturally Responsive Government)

 Library and Community Services Department

1. Continue to develop and maintain reopening/ongoing operating standards for our libraries and recreation centers that mitigate the risk posed by the on going COVID-19 pandemic. (Youth and Seniors)

2. Continue to identify opportunities that support implementation of the Parks, Recreation & Libraries Master Plan. (Youth and Seniors, Public Saf ety, Effective and Culturally Responsive Government, Infrastructure and Environmental Sustainability)

3. Apply for and leverage multiple funding sources and partnerships to offer better programs and services with improved organizational outcomes. ( Youth and Seniors, Public Safety, Effective and Culturally Res ponsive Government, Infrastructure and Environmental Sustainability)

4. Identify new collaborations with school distri cts to increase acces s to facilities through Joint Use Agreements and student support systems like on-site after school programs. (Youth and Seniors)
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5. Continue to increase city-wide volunteer e fforts to beautify a nd uplift AMOR Salinas Principals. (Youth and Seniors).

6. Continue to provide popular hybrid recreation and library programs, including take-home kits and virtual program options, while fully re-establishing in-person programs. (Youth and Seniors)

7. Complete and Publish the Community Allian ce for Safety and Peace Strategic Plan on Violence Reduction for 2022-2025 and present to the City Council. (Public Safety)

8. Assess and prioritize maintenance of Department facilities to ensure a safe and welcoming environment that meets the needs of the community. ( Infrastructure and Environmental Sustainability, Public Safety, Youth and Seniors)

9. Continue to offer prevention and intervention programs and services for at-risk youth and member of other vulnerable populations. (Public Safety, Youth and Seniors, Effective and Culturally Responsive Government)

10. Utilize Crime Prevention Through Environmental Design (CPTED) principles to improve safety in parks and around facilities. ( Infrastructure and Envir onmental Sustainability, Public Safety, Youth and Seniors)

11. Develop a Park Maintenance Standard Manual that will identify standards of work to support a higher standard for upkeep and maintenance of the park system. ( Infrastructure and Environmental Sustainability, Effective and Culturally Responsive Government)

12. Continue to support the Public Arts Commission, implementation of the Public Arts Ordinance and coordination of variety of stakeholders and funders to implement the Public Art Master Plan. ( Economic Development, Effectiv e and Culturally Responsive Government)

13. Leverage existing programs and efforts to de velop a mural program to combat graffiti. (Economic Development)

14. Establish a Race Equity Plan. (Effective and Culturally Responsive Government)

15. Provide Diversity, Equity and Inclusion (DEI) training for policy-makers and staff. (Effective and Culturally Responsive Government)

16. Continue to manage the Hebbron Family Cent er Revitalization Project and enter into a design-build contract. ( Economic Development, Infrastructure and Environmental Sustainability, Public Safety, Youth and Seniors)

17. Continue to manage the Closter
Park Renovation Project. ( Economic Development,
Infrastructure and Environmental Sustainability, Public Safety, Youth and Seniors)

18. Conduct an irrigation assessment of the City's park system. ( Infrastructure and Environmental Sustainability, Public Safety, Youth and Seniors) DRAFT 09.06.2023_v2

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19. Continue to assess and upgrade playground structures, benches, and grills. Infrastructure and Environmental Sustainability, Public Safety, Youth and Seniors)

20. Review the library structure and finalize recommendations for a re-organization to identify a clear structure that improves service delivery. (Effective and Culturally Responsive Government)

21. Seek and implement new techno logies and digital resources to increase the efficiency, convenience, and level of service to the community. (Effective and Culturally Responsive Government)

22. Expand the Library’s device lending program to include laptops and hotspots, to alleviate digital divide in the community. (Effective and Culturally Responsive Government)

23. Continue to provide Adult and Family Lite racy services, including English language and basic computer literacy, citizenship exam, and high school equivalency preparation classes. (Youth and Seniors)

24. Re-establish additional in-person sessions for Read Grow Play playgroup programs, restart Kinder mobile service for Salinas’ kindergarte ners, and continue to provide seasonal reading challenges for Salinas youth to encourage love of reading. (Youth and Seniors)

25. Continue to offer and expand the SMART card program for all school districts in Salinas (Youth and Seniors)

26. Fully launch makerspace for public access at El Gabilan Library and improve technology access at all libraries (Effective and Culturally Responsive Government)

27. Evaluate and expand the Librar y’s digital collection and resources to increase relevancy and diversity of offerings (Effective and Culturally Responsive Government)

28. Expand library programs and partnerships for adults and young adu lts in health and wellness, financial li teracy, local history and gen ealogy, and workforce and business development. (Youth and Seniors, Economic Development)

29. Identify opportunities to improve library staff training, engagement, and wellness to better retain and grow talents locally (Effective and Culturally Responsive Government)

30. Identify funding resources and implement building improvement efforts for John Steinbeck and Cesar Chavez Library. (Effective and Culturally Responsive Government

31. Update the special
event permit process to improve efficiencies, mitigate risk and create a positive customer service experience for the event organizer. ( Effective and Culturally Responsive Government, Economic Development
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 Police Department

1. Continue to secure new grants and supplem ental funding to support police operations and expand services to the community. (Strategic Goal: Public Safety & Effective and Culturally Responsive Government)

2. As recommended in the workload analysis, implement new patrol beat boundaries to greater balance workload. (Strategic Goal: Public Safety)

3. Effective utilization of resour ces and staffing to efficien tly provide services to the community. (Strategic Goal: Public Safety & Effective and Culturally Responsive Government)

4. Maintain CSO staffing to address quality of li fe issues such as abandoned vehicles and community engagement. (Strategic Goal: Public Saf ety & Effective and Culturally Responsive Government)

5. Work collaboratively with Code Enforcement and the City Attorney’s Office to address quality of life issues. (Strategic Goal: Public Safety)

6. Increase community engagement throughout all levels of the department. (Strategic Goal:

Public Safety & Effective and Culturally Responsive Government)

7. Continue to work on evaluating and implemen ting the remaining Department of Justice’s Collaborative Reform Initiative recommendations, as appropriate. (Strategic Goal: Public Safety & Effective and Culturally Responsive Government)

8. Continued to implement and expand the community policing concept to maintain and increase communication and transparency with the community. (Strategic Goal: Public Safety)

 Public Works Department

Investment Strategies/Risk Management

1. Downtown Vibrancy Plan Implementation
a. Complete construction of Main Street for 100, 200 and 300 block. b. Complete construction of Downtown Complete streets, on West Alisal from Front Street to Blanco Road.

2. Support development of Salinas Travel Center project, Airport L ease Project, Unikool (John Street) Project, SkyWest Project, and the Sobel Project.

3. Complete the Mitigated Negative Declaration for Boronda Road Congestion Relief Project (future growth area).

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4. Complete 75% design for Boronda Road and McKinnon roundabout.

5. Submit 90% plans of Williams Road to PG&E for the kickoff of the Utility Undergrounding design project.

6. Technical Support for the West Area and Central Area Specific Plans approval process.

7. Provide engineering and street maintenance support for various City special events.

8. Completed 90% Design for the Williams Road Improvements.

9. Continuing work to develop sustainable parkin g enterprises which help support the city’s economic sectors.

10. Project closeout for the Sanborn/Elvee/HWY 101.

11. Completed the fiberoptic backbone for the Downtown Fiber Optic Network plan.

12. Complete Installation of new metal roof at Fire Station no. 1.

13. Support regional plan to extend commuter rail se rvice to Salinas that will provide access to jobs in the Bay Area and Silicon Valley.

14. Development complete streets, multi-modal corr idors, and a sustainable transportation to support responsible future growth area and mitigate vehicle miles travelled (VMT).

15. Supported the Airport Lease Project MND and began coordination with Caltrans as part of mitigation program to improve Airport Blvd/US 101 Ramps.

16. Support the Salinas Ag Industrial Center Deve lopment Project and continue coordinating with Caltrans and TAMC t improve US 101 access in South Salinas.

17. Completed plans and awarded a bid for the Pedestrian Crossing Enhancements Project.

18. Completed new Franchise Agreement for Soli d Waste Services after over a year of negotiations.

19. Completed new agreement with Salinas Valley Solid Waste Authority which requires the relocation of the Sun Street Transfer Station outside the City.

20. Completed Agreement with California Water Board to accept $8.8M in grant funds for the Industrial Wastewater Treatment Facility.

Public Safety

1. Continuing work with Monterey County Health Department , TAMC, and Blue Zones to develop Traffic Safety education programs.

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2. Continued homeless encampment cleanups.

3. Begin construction of East Laurel Drive Pedestrian Improvements and Street Lighting.

4. Completed construction of Old Muni Pool phase 1, 2 and 3.

5. Begin construction of the Bardin Road Safe Routes to School Improvements.

6. Completed construction of the Alvin Drive Safe Routes to School Project.

7. Completed construction of thr ee new traffic signals (Alvin Drive/Linwood and the Alvin Drive/El Dorado Intersections; and at North Main/Street/Navajo Drive in support of the El Gabilan Library Extension.

8. Completed Council approved Traffic Calming Projects at Geil Street.

9. Completed sidewalk repairs at District 3, District 4 and District 2 in the amount of $900K through the Job Order Contract (JOC) Sidewalk Improvement Program.

10. Continued developing the Salinas Safe Rout es to School Plan with Ecology Action and TAMC.

11. Completed new sidewalks and eliminated the “missing” pedestrian link on Maryal Drive serving Sherwood Park, Tatum’s Garden, the Rodeo Grounds and Boys and Girls Club.

Operational Efficiencies

1. Developing Sustainable Citywide Parking Management Program a. Continued to manage the Parking Enterprise Programs
b. Demonstrated successful implementation of Parking Enforcement Enterprise; improving services while continuing to cover costs at the same time supporting the City’s economic and safety objectives. E xpanded parking enforcement services to weekends and early evenings.
c. Indexed the rates in the Downtown Parki ng District to reduce dependence of the enterprise on the City General Fund.
d. Transitioned to a new parking citation management vendor e. Prepared a facility condition assessment report for both Downtown garages to identify deferred maintenance and probable costs to repair

2. Utilized Geographic Information Systems (GIS) for spatial analysis. Spatial analysis lets staff evaluate suitability and capability, esti mate, predict, interpret, and understand data.

This capability is delivered to all City Depa rtments to provide new perspectives to data driven decision-making.

3. Implemented innovative and em erging technology solutions to increase efficiency and effectiveness of City services.

4. Plan of EV stations transformer for the ITC center.

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xxv

5. Embarked upon the development of a Community -Based Public/Private Partnership (P3) process to potentially fund green infrastructure projects throughout the City.

6. Developing Proposition 26 fees to fund the costs of NPDES inspection and plan review activities.

7. Continuing Implementation of the City Traffic Fee Ordinance.

8. Completed draft final plans for the Sherwood/Front St Ad aptive Traffic Signal System Project.

9. Implemented measures to more closely track revenue and manage the City’s Franchise Agreement for Solid Waste Services.

Excellent Infrastructure

1. Completed Mitigated Negative Declarati on for Boronda Road Improvements which provides increase capacity to four lanes and 5 new roundabouts at key intersections.

2. Begin construction of 2021 Chip Seal project City Wide.

3. Complete 80% design of San Juan Grade Road rehabilitation.

4. Continuing Development of City’s Active Transportation Plan.

5. Continue identifying funding for improvements for implementation of the East Alisal Corridor Plan.

6. Secured grant funding to stretch transportation dollars.

7. Hired consultant to update City Standard Plans and Specifications.

8. Updated Pavement Management System for future road maintenance.

9. Applied for HSIP Grants to fund a part of Williams Road Improvements.

10. Refreshed over 17,000 linear feet of crosswalks.

11 Complete Design of 2021 Slurry Seal Project City Wide.

12 Complete Design of Montebella Subdivision Slurry Seal project.

11. Complete Construction of East Alvin Drive Safe Routes to School Project.

12. Complete construction for North Main/Navajo traffic signal project.

13. Complete Construction of Downtown Complete Street
Project.

14. Awarded the bid for the traffic signal at Alisal Street and Murphy Street.

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xxvi

15. Adopted the Vision Zero Plan to reduce severe injuries and fatalities on city streets.

16. Completed sludge removal project at the Industrial Wastewater Treatment Facility.

Labor Relations

The City completed negotiations with the two Fire units, the International Association of Fire Fighters (IAFF) and the Fire Supe rvisors Association. New Compensa tion Plans were approved for the unrepresented units consisting of Confidential Management, Confidential Non-Management, and most recently in February 2023, Department Di rectors. The City’s nego tiation team is starting negotiations with the three Service Employees International Union (SEIU) Local 521 units and with the Association of Management Personnel of Salinas (AMPS) on March 1, 2023. The MOUs for those four units expire June 30, 2023. The Salinas Police Officers Association MOU expires December 31,2023.

Acknowledgements

The preparation of this Annual Financial Report could not have been accomplished without the professional, efficient, and dedicated service of the staff of the Finance Department. In particular, I would like to acknowledge and give a very special thanks to Accounting Manager, Eric Burl, and Finance Management Analyst, Abe Pedroza, both of whom are dedicated to the sound fiscal management of the City. The entire Finance staff deserves a special word of thanks for another year of hard work and quality performance. I also wi sh to thank our audito rs, The Pun Group LLP, Accountants & Advisors, for their diligence, cooperation and assistance.

Sincere appreciation is also expressed to the City Manager and members of the City Council for their support in planning and conducting the financial operations of the City in a responsible, sustainable and progressive manner.

Respectfully submitted,

Jim Pia
Assistant City Manager / Acting Finance Director
DRAFT 09.06.2023_v2
Carla Viviana Gonzalez Orlando Osornio
Councilmember Councilmember
District 1 District 4
Tony Bar r er a Chr istie Cr om eenes
Councilmember Councilmember
District 2 District 5
Steve McShane Anthony Rocha
Councilmember Councilmember
District 3 District 6
Jim Pia David Jacobs
Assistant City Manager Public Works Director
Kristan Lundquist Megan Hunter
Library and Community Community
Services Director Development Director
Roberto Filice Sam Klemek
Chief of Police Fire Chief
Mark Roberts Marina Horta-Gallegos
Finance Director Human Resources
Director
Kimbley Craig
Ma yor
Ste ve n S. Carrigan Christophe r A. Callihan
City Manag er City Attorney
xxvii
DRAFT 09.06.2023_v2

CITY OF SALINAS
Organizational Chart
CITY

MANAGER

CITY COUNCIL

FINANCE
Accounting
Revenue &
Licensing
Information
Systems
Purchasing
Successor
Agency
FIRE

PUBLIC WORKS
Engineering &
Transportation
Environmental
Maintenance
Geographic
Information
Systems
Airport
POLICE

LIBRARY &

COMMUNITY

SERVICES
Library
Services
Parks & Sports
Administration
Youth Services
& Community
Engagement

COMMUNITY

DEVELOPMENT
Adv Planning &
Project
Implementation
Administration
Current
Planning
Permit
Services
Housing &
Community
Development
Code
Enforcement
Economic
Development
HUMAN

RESOURCES

CITY ATTORNEY
Administration
Division
City Clerk
Administration
Support
xxviii
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FINANCIAL SECTION
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INDEPENDENT AUDITORS’ REPORT

To the Honorable Mayor and Members
of the City Council of the City of Salinas
Salinas, California

Report on the Audit of the Financial Statements

Opinions

We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Salinas, California (the “City”), as of and for the year ended June 30, 2022, and the related notes to the basic 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, as of June 30, 2022, and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in accordance with accounting prin ciples generally accepted in the United States of America.

Basis for Opinions

We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to fi nancial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States. Our responsibilities under tho se standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements secti on of our report. We are requi red to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Responsibilities of Management for the Financial Statements

Management is responsible for the prep aration and fair presentation of the fi nancial statements in accordance with accounting principles generally accepted in the United Stat es 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 wh ether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.

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To the Honorable Mayor and Members
of the City Council of the City of Salinas
Salinas, California

2 Auditors’ Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whet her the financial statements as a whole are free from material misstatement, whether due to fraud or error, a nd to issue an auditors’ report that includes our opinions.

Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with ge nerally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The ri sk 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 w ould influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:

 Exercise professional judgment and maintain professional skepticism throughout the audit.  Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.  Obtain an understanding of internal c ontrol relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed.  Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.  Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.

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

Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the Management’s Discussion and Analysis, Budgetary Comparison Sc hedules, Schedules of Changes in Net Pension Liability a nd Related Ratios, Schedules of Proportionate Share of the Net Pension Liability and Related Ratios, Schedules of Pension Contributions, Schedule of Changes in Net OPEB Liability and Related Ratios, and Schedule of OPEB Contributions be presented to supplement the basic financial statements. Such information is the responsibility of mana gement and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the b asic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the inform ation and comparing the information for consistency with management’s responses to our inquiries, the basic financia l statements, and other knowledge we obtained during our audit of the basic financial statements. We do not expr ess an opinion or provide any assurance on the information because the limited procedures do not provide us with su fficient evidence to express an opinion or provide any assurance.

DRAFT 09.06.2023_v2
To the Honorable Mayor and Members
of the City Council of the City of Salinas
Salinas, California

3 Supplementary Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The accompanying Comb ining and Individual Fund Statements and Schedules are presented for purposes of additional analysis and are not a re quired part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The informa tion 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 direc tly to the underlying accounting and othe r records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the Combining and Individual Fund Statements and Schedules are fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Information

Management is responsible for the othe r information included in the annual report. The other information comprises the Introductory Section, the Combin ing Balance Sheet – General, Measure E, & Measure G Funds, the Combining Statement of Revenues, Expenditures, and Changes in Fund Balance – General, Measure E, & Measure G Funds, the Budgetary Comparison Schedule – Measure E, the Budgetary Comparison Schedule – Measure G, and the Claims Development for Internal Service Funds Schedules but does not include the basic financial statements and our auditors’ report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.

In connection with our audit of the basi c financial statements, our responsibility is to read the other information and consider whether a material inconsistenc y exists between the other information and the basic financial statements, or the other information otherwise appears to be materially mi sstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated __________, 2023, on our consideration of the City’s internal control over financia l reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreemen ts and other matters. The purpose of that report is solely to describe the scope of our testing of internal control ove r 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.

Santa Ana, California
__________, 2023
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BASIC FINANCIAL STATEMENTS
15 DRAFT 09.06.2023_v2
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16 DRAFT 09.06.2023_v2

GOVERNMENT-WIDE FINANCIAL STATEMENTS
17 DRAFT 09.06.2023_v2
Governmental Business-Type
Activities Activities Total
ASSETS
Current assets:

Cash and investments 216,282,792 $ 16,403,450 $ 232,686,242 $ Receivables, net of allowance:

Accounts receivable, net 504,354 1,434,329 1,938,683 Taxes receivable 19,437,488 - 19,437,488 Assessments receivable 8,290,000 - 8,290,000 Due from outside agencies 12,880,254 - 12,880,254 Leases receivable 561,725 429,471 991,196 Interest receivable 1,243,616 44,061 1,287,677 Internal balances:

Due from (to) other funds 1,755,623 (1,755,623) - Advances to (from) other funds 2,785,000 (2,785,000) - Total current assets 263,740,852 13,770,688 277,511,540 Noncurrent assets:

Restricted cash and investments 1,077,537 6,987 1,084,524 Receivables, net of allowance:

Loans receivable 83,139 - 83,139 Leases receivable 5,484,334 5,154,316 10,638,650 Land and properties held for resale 1,380,000 - 1,380,000 Capital assets:

Non-depreciable 50,324,077 6,579,905 56,903,982 Depreciable, net 284,639,433 65,665,569 350,305,002 Total capital assets 334,963,510 72,245,474 407,208,984 Total noncurrent assets 342,988,520 77,406,777 420,395,297 Total assets 606,729,372 91,177,465 697,906,837

DEFERRED OUTFLOWS OF RESOURCES
Related to pensions 33,428,945 659,470 34,088,415 Related to OPEB 5,248,155 264,787 5,512,942 Loss on refunding of debt 513,705 103,051 616,756 Total deferred outflows of resources 39,190,805 1,027,308 40,218,113 June 30, 2022
Statement of Net Position
City of Salinas
Primary Government
See accompanying Notes to the Basic Financial Statements. 18 DRAFT 09.06.2023_v2
Governmental Business-Type
Activities Activities Total

LIABILITIES
Current liabilities:

Accounts payable 9,644,490 731,799 10,376,289 Interest payable 647,315 259,822 907,137 Deposits payable 46,281 48,885 95,166 Unearned revenue 63,428,897 - 63,428,897 Long-term debt - due within one year 7,923,883 1,637,000 9,560,883 Compensated absences - due within one year 2,324,983 109,577 2,434,560 Insurance claims payable - due within one year 7,489,982 - 7,489,982 Total current liabilities 91,505,831 2,787,083 94,292,914 Noncurrent liabilities:

Long-term debt - due in more than one year 122,480,548 22,738,000 145,218,548 Compensated absences - due in more than one year 9,299,959 438,310 9,738,269 Insurance claims payable - due in more than one year 23,800,213 - 23,800,213 Net pension liability 136,255,627 1,900,685 138,156,312 Net OPEB liability 16,238,956 819,308 17,058,264 Total noncurrent liabilities 308,075,303 25,896,303 333,971,606 Total liabilities 399,581,134 28,683,386 428,264,520

DEFERRED INFLOWS OF RESOURCES
Related to pensions 59,208,218 1,264,352 60,472,570 Related to OPEB 11,250,198 567,609 11,817,807 Related to leases 6,019,272 5,470,507 11,489,779 Gain on refunding of debt - - - Total deferred inflows of resources 76,477,688 7,302,468 83,780,156

NET POSITION
Net investment in capital assets 204,559,079 47,973,525 252,532,604 Restricted for:

Housing 1,169,045 - 1,169,045 Capital projects 14,678,399 - 14,678,399 Public safety 2,520,642 -
2,520,642
Highways and streets 24,061,474 - 24,061,474 Debt service 4,856,210 - 4,856,210 Special programs 29,287,446 - 29,287,446 Total restricted 76,573,216 - 76,573,216 Unrestricted (deficit) (111,270,940) 8,245,394 (103,025,546) 169,861,355$ 56,218,919$ 226,080,274$ Total net position Primary Government
City of Salinas
Statement of Net Position (Continued)
June 30, 2022
See accompanying Notes to the Basic Financial Statements. 19 DRAFT 09.06.2023_v2
Operating Capital
Charges for Grants an d Grants and
Functions/Programs Expenses Services Contributions Contributions Total Primary government:

Governmental activities:

General government 43,209,427$ 5,304,557 $ 20,842,717 $ 3,356,082 $ 29,503,356 $ Public safety 91,246,533 2,173,480 2,720,849 28,126 4,922,455 Public works 34,883,172 4,471,602 4,475,055 11,049,389 19,996,046 Recreation 8,022,645 99,873 407,261 12,009 519,143 Library 5,377,321 38,483 475,704 - 514,187 Interest on long-term debt 4,808,025 - - - - Total governmental activities 187,547,123 12,087,995 28,921,586 14,445,606 55,455,187 Business-type activities:

Airport 2,481,106 2,083,091 - - 2,083,091 Industrial Waste 2,200,902 3,079,518 - - 3,079,518 Sanitary Sewer 4,673,935 3,773,089 - - 3,773,089 Downtown Parking District 2,193,677 362,087 - - 362,087 Permit Services 3,386,841 4,359,752 - - 4,359,752 Total business-type activities 14,936,461 13,657,537 - - 13,657,537 Total primary government 202,483,584$ 25,745,532$ 28,921,586$ 14,445,606$ 69,112,724$

City of Salinas
Statement of Activities and Changes in Net Position
For the Year Ended June 30, 2022
Program Revenues
See accompanying Notes to the Basic Financial Statements. 20 DRAFT 09.06.2023_v2
Governmental Business-Type
Functions/Programs Activities Activities Total
Primary government:

Governmental activities:

General government (13,706,071)$ - $ (13,706,071)$ Public safety (86,324,078) - (86,324,078) Public works (14,887,126) - (14,887,126) Recreation (7,503,502) - (7,503,502) Library (4,863,134) - (4,863,134) Interest on long-term debt (4,808,025) (709,198) (5,517,223) Total governmental activities (132,091,936) (709,198) (132,801,134) Business-type activities:

Airport - (398,015) (398,015) Industrial Waste - 878,616 878,616 Sanitary Sewer - (900,846) (900,846) Downtown Parking District - (1,831,590) (1,831,590) Permit Services - 972,911 972,911 Total business-type activities - (1,278,924) (1,278,924) Total primary government (132,091,936) (1,988,122) (134,080,058) General Revenues and Transfers:

General revenues:

Taxes:

Property taxes 34,755,630 - 34,755,630 Sales taxes 88,968,698 - 88,968,698 Utility user tax 12,106,526 - 12,106,526 Business tax 17,835,145 - 17,835,145 Transient occupancy tax 3,682,621 - 3,682,621 Total taxes 157,348,620 - 157,348,620 Revenue from Fiduciary Funds - 951,900 951,900 Investment earnings (loss) (1,572,611) (37,810) (1,610,421) Gain (loss) on sale of capital assets (34,879) - (34,879) Miscellaneous revenue 1,220,103 1,662,671 2,882,774 Transfers 4,243,402 (4,243,402) -
Total general revenues and transfers 161,204,635 (1,666,641) 159,537,994 Change in net position 29,112,699 (3,654,763) 25,457,936 Net Position:

Beginning of year, as restated (Note 23) 140,748,656 59,873,682 200,622,338 End of year 169,861,355$ 56,218,919$ 226,080,274$ For the Year Ended June 30, 2022
Statement of Activities and Changes in Net Position (Continued) City of Salinas
Net (Expense) Revenue
and Changes in Net Position
See accompanying Notes to the Basic Financial Statements. 21 DRAFT 09.06.2023_v2
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22 DRAFT 09.06.2023_v2

FUND FINANCIAL STATEMENTS
23 DRAFT 09.06.2023_v2
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24 DRAFT 09.06.2023_v2

GOVERNMENTAL FUNDS FINANCIAL STATEMENTS
General Fund - This fund accounts for all financial resources necessary to carry out basic governmental activities of the City that are not accounted for in another fund. This fund supports essential City services such as police and fire protection, street maintenance, libraries, parks, and open space maintenance.

SPECIAL REVENUE FUNDS
Special revenue funds are used to account for specific revenues that are legally restricted to expenditures for specified purposes. The following funds have been classified as major special revenue funds:

American Rescue Plan Act (ARPA) Special Revenue Fund - On March 11, 2021, President Biden signed the American Rescue Plan Act, which will provide the City with approximately $51 million in relief funds. This fund accounts for the revenues and expenditures of ARPA proceeds.

Housing and Urban Development Grant Special Revenue Fund - This fund accounts for the use of Community Development Block Grant funds received from the federal government. Other revenues in this fund include repayments of commercial and residential loans and rental income from City property. Funds are used for programs or projects that increase affordable housing and benefit people with special needs such as senior and handicapped citizens. 25 DRAFT 09.06.2023_v2
American Housing
Rescue Plan Act and Urban
(ARPA) Development Grant Non-major Total
General Special Revenue Special Revenue Governmental Governmental Fund Fund Fund Funds Funds
ASSETS
Cash and investments 61,594,027$ 51,179,200$ 4,961,985$ 74,555,184$ 192,290,396$ Receivables, net:

Accounts 504,354 - - - 504,354 Taxes 19,437,488 - - - 19,437,488 Interest 223,832 - 874 1,001,872 1,226,578 Due from outside agencies 75,000 - 5,111,387 7,693,867 12,880,254 Assessments - - - 8,290,000 8,290,000 Leases 2,004,626 - - 4,041,433 6,046,059 Due from other funds 8,106,123 - - 1,364,533 9,470,656 Advances to other funds 2,785,000 - - - 2,785,000 Restricted cash and investments - - - 686,637 686,637 Loans and notes receivable, net of allowance - - 66,568 16,571 83,139 Land and properties held for resale - - - 1,380,000 1,380,000 Total assets 94,730,450$ 51,179,200$ 10,140,814$ 99,030,097$ 255,080,561$

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES, AND FUND BALANCES
Liabilities:

Accounts payable 5,553,370$ 303,271 1,078,166 2,546,746$ 9,481,553$ Due to other funds 17,171,126 - 4,012,495 3,362,874 24,546,495 Deposits payable 46,281
- - - 46,281 Unearned revenues - 50,875,929 4,078,807 8,474,161 63,428,897 Total liabilities 22,770,777 51,179,200 9,169,468 14,383,781 97,503,226

DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - - 3,743,533 4,487,104 8,230,637 Lease-related deferred inflows 1,975,003 - - 4,044,269 6,019,272 Total deferred inflows of resources 1,975,003 - 3,743,533 8,531,373 14,249,909

Fund Balances (Deficit):

Nonspendable 2,785,000 - 66,568 1,396,571 4,248,139 Restricted 6,000,000 - - 73,000,753 79,000,753 Committed 36,365,323 - - 2,141,985 38,507,308 Assigned 15,266,804 - - - 15,266,804 Unassigned (deficit) 9,567,543 - (2,838,755) (424,366) 6,304,422 Total fund balances (deficit) 69,984,670 - (2,772,187) 76,114,943 143,327,426 Total liabilities, deferred inflows of
resources, and fund balances 94,730,450$ 51,179,200$ 10,140,814$ 99,030,097$ 255,080,561$ Major Funds
City of Salinas
Balance Sheet
Governmental Funds
June 30, 2022
26 DRAFT 09.06.2023_v2
Total Fund Balances - Total Governmental Funds 143,327,426$ Capital assets used in the governmental activities were not financial resources and therefore were not reported in the Governmental Funds Balance Sheet.

Non-depreciable/amortizable 50,324,077
Depreciable/amortizable, net 284,639,433
Total capital assets 334,963,510
Deferred inflows resulting from revenues that are not available topay for current period expenditures are reported as unavailable in the Governmental Funds Balance Sheet. 8,230,637 Long-term liabilities are not due andpayable in the currentperiod and therefore were not reported in the Governmental Funds Balance Sheet.

Compensated absences - due within one year, net of $26,138 reported in the Internal Service Funds (2,298,845) Compensated absences - due in more than one year, net of $104,548 reported in the Internal Service Funds (9,195,411)
Insurance c
laims payable - due within one year -
Insurance claims payable - due in more than one year (1,638,485) Long-term debt - due within one year (7,923,883)
Long-term debt - due in more than one year (122,480,548) Total long-term liabilities (143,537,172)
Governmental funds report the effects of debt refundings and similar items when debt is first issued, whereas these amounts are deferred and amortized in the Statement of Activities for the following:

De
ferred loss on refunding of debt 513,705
Total 513,705
Interest payable on long-term debt did not require current financial resources. Therefore, interestpayable was not reported as a liability in the governmental funds. (647,315) Net pension liability and total OPEB liability used in the governmental activities were not financial resources and therefore were not reported in the Governmental Funds Balance Sheet.

Net pens
ion liability, net of $696,803 reported in the Internal Service Funds (135,558,824) Net OPEB liability, net of $274,297 reported in the Internal Service Funds (15,964,659) Total net pension liability and net OPEB liability (151,523,483) Deferred outflows of resources related to OPEB andpensions are not available for current period and, therefore, are deferred in the governmental funds or not recorded in the governmental funds.

Deferred outflows of resources related to pensions, net of $241,766 reported in the Internal Service Funds 33,187,179
De
ferred outflows of resources related to OPEB, net of $88,648 reported in the Internal Service Funds 5,159,507 Total deferred outflows of resources 38,346,686
Deferred inflows of resources related to OPEB andpensions are not available for current period and, therefore, are deferred in the governmental funds or not recorded in the governmental funds.

Deferred inflows of resources related to pensions, net of $463,519 reported in the Internal Service Funds (58,744,699)
De
ferred inflows of resources related to OPEB, net of $190,030 reported in the Internal Service Funds (11,060,168) Total deferred inflows of resources (69,804,867)
Internal service funds are used by management to charge the cost of information technology, vehicle replacement, fleet management and infrastructure to individual funds. The assets and liabilities of the internal service funds are included in the governmental activities in the statement of net position. 9,992,228 Net Position of Governmental Activities 169,861,355$
Amounts reported for Governmental Activities in the Statement of Net Position were different because:

City of Salinas
Reconciliation of the Governmental Funds Balance Sheet
To the Government-Wide Statement of Net Position
June 30, 2022
27 DRAFT 09.06.2023_v2
American Housing
Rescue Plan Act and Urban
(ARPA) Development Grant Non-major Total
General Special Revenue Special Revenue Governmental Governmental Fund Fund Fund Funds Funds
REVENUES:

Taxes 145,835,874$ -$ -$ 535,460$ 146,371,334$ Taxes - special assessments - - - 749,723 749,723 Licenses and permits 11,477,723 - - 178,135 11,655,858 Intergovernmental 1,301,666 691,383 7,313,240 34,197,628 43,503,917 Charges for services 5,233,403 - - 2,546,586 7,779,989 Investment income (loss) (1,406,103) - (4,637) (810,543) (2,221,283) Rental income 325,113 - - 271,903 597,016 Fines and forfeitures 426,149 - - 310,441 736,590 Miscellaneous 1,014,576 - 585,715 3,605,272 5,205,563 Total revenues 164,208,401 691,383 7,894,318 41,584,605 214,378,707

EXPENDITURES:

Current:

General government 17,192,429 415,764 9,757,121 13,675,288 41,040,602 Public safety 82,456,087 2,986 - 3,798,288 86,257,361 Public works 12,877,048 224,521 - 8,305,410 21,406,979 Recreation 5,578,195 - - 625,184 6,203,379 Library 4,401,235 - - 358,281 4,759,516 Capital outlay 442,723 48,112
38,097 17,509,971 18,038,903
Debt service:

Principal 655,441 - - 14,512,279 15,167,720 Interest and fiscal charges 217,285 - - 5,257,521 5,474,806 Total expenditures 123,820,443 691,383 9,795,218 64,042,222 198,349,266

REVENUES OVER (UNDER) EXPENDITURES 40,387,958 - (1,900,900) (22,457,617) 16,029,441 OTHER FINANCING SOURCES (USES):

Proceeds from sale of capital assets 1 - - - 1 Transfers in 1,979,099 - 4,424 34,029,963 36,013,486 Transfers out (34,881,666) - - (9,669,718) (44,551,384) Total other financing sources (uses) (32,902,566) - 4,424 24,360,245 (8,537,897) NET CHANGE IN FUND BALANCES 7,485,392 - (1,896,476) 1,902,628 7,491,544 FUND BALANCES (DEFICIT):

Beginning of year, as restated (Note 23) 62,499,278 - (875,711) 74,212,315 135,835,882 End of year 69,984,670$ -$ (2,772,187)$ 76,114,943$ 143,327,426$ Major Funds
City of Salinas
Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds
For the Year Ended June 30, 2022
28 DRAFT 09.06.2023_v2
Net Change in Fund Balances - Total Governmental Funds 7,491,544$ Governmental funds reported capital outlay as expenditures. However, in the Government-Wide Statement of Activities and Changes in Net Position the cost of those assets was allocated over their estimated useful lives as depreciation expenses. This is the amount of capital assets recorded in the current period. 7,438,217 Depreciation and amortization expense on capital assets was reported in the Government-Wide Statement of Activities and Changes in Net Position, but they did not require the use of current financial resources. Therefore, depreciation expense was not reported as expenditures in the Governmental Funds. (12,950,024) Retirement of capital assets created a loss on the Government-Wide Statement of Activities and Changes in Net Position. (34,880)
Repayment of long-term liabilities was an expenditures in governmental funds, but the repayment reduced long-term liabilities in the Government-Wide Statement of Net Position.

Principal payment of long-term debt 15,167,720
Amortization of bond premiu
m (714,948)
GASB 87 activity for did not require the use of current financial resources. (286,243) Interest expenses on long-term debt was reported in the Government-Wide Statement of Activities, but it did not require the use of current financial resources. This amount represented the changes in accrued interest from prior year. 50,816 Compensated absences expenses reported in the Government-Wide Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds. 966,792 Claims payable expenses reported in the Government-Wide Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds. 143,745 Revenues in the Government-Wide Statement of Activities that do not provide current financial resources and are not reported as revenue in the governmental funds. (61,405) Certain pension credits reported in the Government-Wide Statement of Activities do not provide current financial resources and therefore, are not reported as expenditures in governmental funds. 6,038,727 Certain OPEB expenses reported in the Government-Wide Statement of Activities do not require the use of current financial resources and therefore, are not reported as expenditures in governmental funds. (236,222) The internal service funds are used by management to charge the costs of fleet maintenance, facilities maintenance, and technology to individual funds. The net revenue of certain activities of internal service funds is reported with governmental activities. 6,098,860
Chan
ge in Net Position of Governmental Activities 29,112,699$ Amounts reported for Governmental Activities in the Statement of Net Position were different because:

City of Salinas
Reconciliation of the Governmental Funds Statement of Revenues, Statement of Activites and Changes in Net Position
For the Year Ended June 30, 2022
Expenditures, and Changes in Fund Balances to the Government-Wide 29 DRAFT 09.06.2023_v2
This page intentionally left blank.
30 DRAFT 09.06.2023_v2

PROPRIETARY FUNDS FINANCIAL STATEMENTS
Proprietary Funds are used to account for a government’s business-type activities (activities supported, at least in part, by fees or charges). Proprietary funds are segregated into Enterprise Funds and Internal Service Funds. Enterprise Funds are used to report business-type activities for which a fee is charged to external users for goods or services. Internal Service Funds on the other hand, are used primarily for services provided to internal users.

The City reports the following enterprise funds:

Airport Fund - This fund is used to account for the enterprise operations of the City-owned airport.

Industrial Waste Fund - This fund is used to account for the enterprise operations of the City-operated Industrial Wastewater Treatment Facility.

Sanitary Sewer Fund - This fund is used to account for the maintenance of the City's sanitary sewer collection system, which is funded by user fees and by the Monterey Regional Water Pollution Control Agency sewer user fees.

Downtown Parking District Fund - This fund was established to account for revenues, operating expenses and debt service associated with the City’s parking facilities. The City’s paid parking facilities include the Monterey Street Parking Structure, the Salinas Street Garage and four parking lots.

Permit Services Fund – This fund is used to account for the revenues and expenditures associated with providing permitting services to the community.

Internal Service Funds are used to account for the financing of goods or services provided by one department or agency to other departments or agencies of the government and to other government units, on a cost reimbursement 31 DRAFT 09.06.2023_v2
Downtown
Industrial Sanitar y Parking
Airport Waste Sewer District
ASSETS
Current assets:

Cash and cash equivalents 2,007,103$ 8 ,933,064$ 1 ,377,472$ 764 ,768$ Receivables, net:

Accounts 118 ,435 347 ,872 818 ,958 148 ,766 Accrued interest 22,363 13 ,070 2 ,512 - Leases receivable 429,471 - - - Due from other funds - - - - Total current assets 2,577,372 9,294,006 2,198,942 913,534 Noncurrent assets:

Restricted cash and investments - - 6 ,987 - Leases receivable, long term 5,154,316 - - - Capital assets:

Non-depreciable 2,436,613 1,648,802 2,475,732 18,758 Depreciable, net 14,192,734 13,452,315 30,738,486 7,229,914 Total capital assets 16,629,347 15,101,117 33,214,218 7,248,672 Total noncurrent assets 21,783,663 15,101,117 33,221,205 7,248,672 Total assets 24,361,035 24,395,123 35,420,147 8,162,206

DEFERRED OUTFLOWS OF RESOURCES
Related to pensions 109,932 65 ,947 263 ,788 - Related to OPEB 43 ,277 33 ,574 81 ,757 6 ,119 Loss on refunding of debt - - - 103,051 Total deferred outflows of resources 153,209 99,521 345,545 109,170

LIABILITIES
Current liabilities:

Accounts payable 105,856 222 ,732 172 ,883 108 ,271 Interest payable - 16,625 124 ,077 119 ,120 Due to other funds - 26 ,220 12 ,123 1 ,705,208 Deposits payable 48,885 - - - Compensated absences - due within one year 18,357 10 ,612 31 ,561 790 Long-term debt - due within one year - 478 ,000 560 ,000 599 ,000 Insurance claims payable - due within one year - - - - Total current liabilities 173,098 754,189 900,644 2,532,389 Noncurrent liabilities:

Advances from other funds - - - 2 ,785,000 Compensated absences - due in more than one year 73,427 42 ,450 126 ,242 3 ,164 Long term debt - due in more than one year - 1 ,015,000 13 ,310,000 8 ,413,000 Insurance claims payable - due in more than one year - - - - Net pension liability 316,839 190 ,069 760 ,274 - Net OPEB liability 133,907 103 ,885 252 ,974 18 ,935 Total noncurrent liabilities 524,173 1,351,404 14,449,490 11,220,099 Total liabilities 697,271 2,105,593 15,350,134 13,752,488

DEFERRED INFLOWS OF RESOURCES
Related to pensions 210,764 126 ,435 505 ,741 - Related to OPEB 92 ,770 71 ,970 175 ,258 13 ,118 Related to leases 5 ,470,507 - - - Total deferred inflows of resources 5,774,041 198,405 680,999 13,118

NET POSITION (DEFICIT)
Net investment in capital assets 16,629,347 13,608,117 19,344,218 (1,660,277) Unrestricted 1,413,585 8,582,529 390,341 (3,833,953) Total net position (deficit) 18,042,932$ 22,190,646$ 19,734,559$ (5,494,230)$ Major Enterprise Funds
City of Salinas
Statement of Net Position
Proprietary Funds
June 30, 2022
See accompanying Notes to the Basic Financial Statements. 32 DRAFT 09.06.2023_v2
Governmental
Activities
Permit Internal
Services Total Service Funds
ASSETS
Current assets:

Cash and cash equivalents 3,321,043$ 16 ,403,450$ 23 ,992,396$ Receivables, net:

Accounts 298 1 ,434,329 - Accrued interest 6,116 44 ,061 17 ,038 Leases receivable - 429 ,471 - Due from other funds - - 16 ,831,462 Total current assets 3,327,457 18,311,311 40,840,896 Noncurrent assets:

Restricted cash and investments - 6 ,987 390 ,900 Leases receivable, long term - 5 ,154,316 - Capital assets:

Non-depreciable - 6,579,905 - Depreciable, net 52,120 65,665,569 - Total capital assets 52,120 72,245,474 - Total noncurrent assets 52,120 77,406,777 390,900 Total assets 3,379,577 95,718,088 41,231,796

DEFERRED OUTFLOWS OF RESOURCES
Related to pensions 219,803 659 ,470 241 ,766 Related to OPEB 100 ,060 264 ,787 88 ,648 Loss on refunding of debt - 103,051 - Total deferred outflows of resources 319,863 1,027,308 330,414

LIABILITIES
Current liabilities:

Accounts payable 122,057 731 ,799 162 ,937 Interest payable - 259 ,822 - Due to other funds 12 ,072 1 ,755,623 - Deposits payable - 48 ,885 - Compensated absences - due within one year 48,257 109 ,577 26 ,138 Long-term debt - due within one year - 1 ,637,000 - Insurance claims payable - due within one year - - 7 ,489,982 Total current liabilities 182,386 4,542,706 7,679,057 Noncurrent liabilities:

Advances from other funds - 2 ,785,000 - Compensated absences - due in more than one year 193,027 438 ,310 104 ,548 Long term debt - due in more than one year - 22 ,738,000 - Insurance claims payable - due in more than one year - - 22 ,161,728 Net pension liability 633,503 1 ,900,685 696 ,803 Net OPEB liability 309,607 819 ,308 274 ,297 Total noncurrent liabilities 1,136,137 28,681,303 23,237,376 Total liabilities 1,318,523 33,224,009 30,916,433

DEFERRED INFLOWS OF RESOURCES
Related to pensions 421,412 1 ,264,352 463 ,519 Related to OPEB 214 ,493 567 ,609 190 ,030 Related to leases - 5 ,470,507 - Total deferred inflows of resources 635,905 7,302,468 653,549

NET POSITION (DEFICIT)
Net investment in capital assets 52,120 47,973,525 - Unrestricted 1,692,892 8,245,394 9,992,228 Total net position (deficit) 1,745,012$ 56,218,919 $ 9,992,228 $ City of Salinas
Statement of Net Position (Continued)
Proprietary Funds
June 30, 2022
See accompanying Notes to the Basic Financial Statements. 33 DRAFT 09.06.2023_v2
Downtown
Industrial Sanitar y Parking
Airport Waste Sewer District
OPERATING REVENUES:

Fees 177,084 $ 3,079,518 $ 3,773,089 $ - $ Licenses and permits - - - 362,087 Rental income 1,906,007 - - - Total operating revenues 2,083,091 3,079,518 3,773,089 362,087 OPERATING EXPENSES:

Personnel services 812,453 606,687 2,332,731 82,228 Adminstration 199,652 212,921 308,197 217,437 Contractual services 299,142 767,660 261,128 1,265,525 Supplies 117,924 58,567 134,918 13,989 Insurance 20,636 22,727 46,132 13,051 Insurance claims - - - - Depreciation 957,136 512,071 1,568,293 558,382 Other 74,163 20,269 22,536 43,065 Total operating expenses 2,481,106 2,200,902 4,673,935 2,193,677

OPERATING INCOME (398,015) 878,616 (900,846) (1,831,590) NONOPERATING REVENUES (EXPENSES):

Investment income (loss) 118,917 (89,963) (29,666) - Interest expense - (41,346) (301,593) (366,259) Other nonoperating revenues (expenses) 91,198 (16,469) (7,920) 1,151,488 Total nonoperating revenues (expenses) 210,115 (147,778) (339,179) 785,229

INCOME (LOSS) BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS (187,900) 730,838 (1,240,025) (1,046,361) TRANSFERS:

Transfers in 20,467 1,865,000 45,436 - Transfers out (76,545) (1,811,843) (3,895,108) (32,391) Transfers from fiduciary funds - - - 951,900 Total transfers (56,078) 53,157 (3,849,672) 919,509 Changes in net position (243,978) 783,995 (5,089,697) (126,852) NET POSITION:

Beginning of year, as restated (Note 23) 18,286,910 21,406,651 24,824,256 (5,367,378) End of year 18,042,932$ 22,190,646$ 19,734,559$ (5,494,230)$ Major Funds
City of Salinas
Statement of Revenues, Expenses, and Changes in Fund Net Position Proprietary Funds
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 34 DRAFT 09.06.2023_v2
Governmental
Activities
Permit Internal
Services Total Service Funds
OPERATING REVENUES:

Fees 3,029,777$ 10,059,468$ 7,320,125$ Licenses and permits 1,329,975 1,692,062 - Rental income - 1,906,007 - Total operating revenues 4,359,752 13,657,537 7,320,125 OPERATING EXPENSES:

Personnel services 1,743,904 5,578,003 1,997,540 Adminstration 452,434 1,390,641 - Contractual services 1,058,032 3,651,487 144,302 Supplies 30,395 355,793 752,570 Insurance 83,021 185,567 5,456,906 Insurance claims - - 5,388,935 Depreciation 40,289 3,636,171 - Other (21,234) 138,799 140,099 Total operating expenses 3,386,841 14,936,461 13,880,352

OPERATING INCOME 972,911 (1,278,924) (6,560,227) NONOPERATING REVENUES (EXPENSES):

Investment income (loss) (37,098) (37,810) (122,213) Interest expense - (709,198) - Other nonoperating revenues (expenses) 444,374 1,662,671 - Total nonoperating revenues (expenses) 407,276 915,663 (122,213)

INCOME (LOSS) BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS 1,380,187 (363,261) (6,682,440) TRANSFERS:

Transfers in - 1,930,903 12,781,300 Transfers out (358,418) (6,174,305)
-
Transfers from fiduciary funds - 951,900 - Total transfers (358,418) (3,291,502) 12,781,300 Changes in net position 1,021,769 (3,654,763) 6,098,860 NET POSITION:

Beginning of year, as restated (Note 23) 723,243 59,873,682 3,893,368 End of year 1,745,012$ 56,218,919$ 9,992,228$ City of Salinas
Statement of Revenues, Expenses, and Changes in Fund Net Position (Continued) Proprietary Funds
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 35 DRAFT 09.06.2023_v2
Downtown
Industrial Sanitar y Parkin g
Airport Waste Sewer District
CASH FLOWS FROM OPERATING ACTIVITIES:

Receipts from customers and users 2,065,653 $ 3,088,186 $ 3,709,297 $ 492,058 $ Payments to suppliers (588,242) (943,789) (696,766) (1,569,799) Payments to employees for services (846,583) (637,401) (2,364,902) (83,293) Payments to claimants - - - - Other (74,163) (20,269) (22,536) (43,065) Net cash provided (used) by operating activities 556,665 1,486,727 625,093 (1,204,099)

CASH FLOWS FROM NONCAPITAL FINANCING
ACTIVITIES:

Borrowing from other funds - 23,567 - 170,030 Repayment to other funds - - (705,858) - Other 91,198 (16,469) (7,920) 1,151,488 Transfers from other funds 20,467 1,865,000 45,436 951,900 Transfers to other funds (76,545) (1,811,843) (3,895,108) (32,391) Net cash provided by (used in) noncapital financing
activities 35,120 60,255 (4,563,450) 2,241,027

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Acquisition of capital assets (20,467) (34,123) (216,864) - Payment on capital debt and loans payable - (460,000) (555,000) (578,000) Interest paid on capital debt and borrowings - (45,795) (304,276) (365,310) Net cash (used in) capital and related financing activities (20,467) (539,918) (1,076,140) (943,310) CASH FLOWS FROM INVESTING ACTIVITIES:

Investment income (loss) 97,556 (97,451) 684,879 - Proceeds from leases (113,280) - - - Net cash provided by (used in) investing activities (15,724) (97,451) 684,879 -
Net change in cash and cash equivalents 555,594 909,613 (4,329,618) 93,618 CASH AND CASH EQUIVALENTS:

Beginning of year 1,451,509 8,023,451 5,714,077 671,150 End of year 2,007,103$ 8,933,064$ 1,384,459$ 764,768$

RECONCILIATION OF CASH AND CASH
EQUIVALENTS TO STATEMENT OF NET POSITION:

Cash and cash investments 2,007,103$ 8,933,064$ 1,377,472$ 764,768$ Restricted cash and investments - - 6,987 - Total cash and cash equivalents 2,007,103$ 8,933,064$ 1,384,459$ 764,768$ Major Funds
City of Salinas
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 36 DRAFT 09.06.2023_v2
Governmental
Activities
Permit Internal
Services Total Service Funds
CASH FLOWS FROM OPERATING ACTIVITIES:

Receipts from customers and users 4,359,752 $ 13,714,946 $ 14,810,107 $ Payments to suppliers (1,598,112) (5,396,708) (2,522,098) Payments to employees for services (1,790,603) (5,722,782) (1,940,034) Payments to claimants - - (15,058,605) Other 21,234 (138,799) (140,099) Net cash provided (used) by operating activities 992,271 2,456,657 (4,850,729)

CASH FLOWS FROM NONCAPITAL FINANCING
ACTIVITIES:

Borrowing from other funds 1,231 194,828 - Repayment to other funds - (705,858) - Other 444,374 1,662,671 -
Transfers from other funds - 2,882,803 12,781,300 Transfers to other funds (358,418) (6,174,305) - Net cash provided by (used in) noncapital financing
activities 87,187 (2,139,861) 12,781,300

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Acquisition of capital assets (59,330) (330,784) - Payment on capital debt and loans payable - (1,593,000) (141,223) Interest paid on capital debt and borrowings - (715,381) - Net cash (used in) capital and related financing activities (59,330) (2,639,165) (141,223) CASH FLOWS FROM INVESTING ACTIVITIES:

Investment income (loss) (41,623) 643,361 (131,759) Proceeds from leases - (113,280) - Net cash provided by (used in) investing activities (41,623) 530,081 (131,759) Net chan
ge in cash and cash equivalents 978,505 (1,792,288) 7,657,589 CASH AND CASH EQUIVALENTS:

Beginning of year 2,342,538 18,202,725 16,725,707 End of year 3,321,043$ 16,410,437$ 24,383,296$

RECONCILIATION OF CASH AND CASH
EQUIVALENTS TO STATEMENT OF NET POSITION:

Cash and cash investments 3,321,043$ 16,403,450$ 23,992,396$ Restricted cash and investments - 6,987 390,900 Total cash and cash equivalents 3,321,043$ 16,410,437$ 24,383,296$ City of Salinas
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 37 DRAFT 09.06.2023_v2
Downtown
Industrial Sanitar y Parkin g
Airport Waste Sewer District

RECONCILIATION OF OPERATING INCOME TO

NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES:

Operating income (398,015) $ 878,616 $ (900,846) $ (1,831,590) $ Adjustments to reconcile operating income to net
cash provided by (used in) operating activities:

Depreciation 957,136 512,071 1,568,293 558,382 Changes in operating assets and liabilities, and
deferred outflows and inflows of resources:

Accounts receivable, net (26,778) 8,668 (63,792) 129,971 Deferred outflows - related to pensions 37,876 22,900 91,599 - Deferred outflows - related to OPEB 6,270 4,860 11,803 857 Accounts payable 49,112 118,086 53,609 (59,797) Accrued liabilities - - - - Deposits payable 9,340 - - - Insurance claims payable - - - - Compensated absences (1,536) (10,940) 49,064 (1,434) Net pension liability (278,128) (167,563) (670,246) - Net OPEB liability (60,586) (47,005) (114,335) (8,454) Deferred inflows - related to pensions 205,781 123,441 493,763 - Deferred inflows - related to OPEB 56,193 43,593 106,181 7,966 Total adjustments 954,680 608,111 1,525,939 627,491 Net cash provided by (used in) operating activities 556,665$ 1,486,727 $ 625,093 $ (1,204,099)$ Major Funds
City of Salinas
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 38 DRAFT 09.06.2023_v2
Governmental
Activities
Permit Internal
Services Total Service Funds

RECONCILIATION OF OPERATING INCOME TO

NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES:

Operating income 972,911$ (1,278,924)$ (6,560,227) $ Adjustments to reconcile operating income to net
cash provided by (used in) operating activities:

Depreciation 40,289 3,636,171 - Changes in operating assets and liabilities, and
deferred outflows and inflows of resources:

Accounts receivable, net - 48,069 - Deferred outflows - related to pensions 75,813 228,188 83,735 Deferred outflows - related to OPEB 14,446 38,236 12,796 Accounts payable 25,770 186,780 31,923 Accrued liabilities - - - Deposits payable - 9,340 7,489,982 Insurance claims payable - - (5,869,913) Compensated absences 18,007 53,161 130,686 Net pension liability (556,430) (1,672,367) (613,424) Net OPEB liability (139,935) (370,315) (123,966) Deferred inflows - related to pensions 411,449 1,234,434 452,547 Deferred inflows - related to OPEB 129,951 343,884 115,132 Total adjustments 19,360 3,735,581 1,709,498 Net cash provided by (used in) operating activities 992,271$ 2,456,657 $ (4,850,729) $ City of Salinas
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 39 DRAFT 09.06.2023_v2
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40 DRAFT 09.06.2023_v2
Fiduciary Funds Financial Statements
Fiduciary Funds are used to account for assets held in a trustee or agency capacity for others and therefore cannot be used to support the government’s own programs. The City maintains the following Fiduciary Funds:

PRIVATE PURPOSE TRUST FUNDS
These funds are used to account for any trust arrangement not properly reported in a pension trust fund under which principal and income benefit individuals, private organizations, or other governments. This fund also accounts for the Successor Agency of the former Redevelopment Agency which was dissolved on January 31, 2012 pursuant to state law.

PENSION TRUST FUNDS
These funds are used to account for resources that are required to be held in trust for the members and beneficiaries of defined benefit pension plans, defined contribution plans, or other employee benefit plans. The City’s only pension trust fund is the Deferred Compensation Fund; which allows City employees to invest in trust deeds that are managed by the City with the oversight of an investment committee that is made up of representatives from each of the bargaining units.

CUSTODIAL FUNDS
These funds are used to account for assets held in an agent capacity by the City for individuals, private organizations, other governments and/or other funds that are not required to be reported in pension trust funds, investment trust funds, or private-purpose trust funds.
41 DRAFT 09.06.2023_v2
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42 DRAFT 09.06.2023_v2
Fiduciary
Private Purpose Pension Trust Custodial Funds
Trust Funds Fund Funds Total
ASSETS
Cash and investments 4,067,905 $ 9,263,792$ 87,721$ 13,419,418$ Restricted cash and investments held by fiscal agent 1,706,907 4,367,611 77,059 6,151,577 Receivables, net:

Accounts 7,673 - - 7,673 Interest 3,968 5,133 - 9,101 Loans and notes receivable 173,900 - - 173,900 Total assets 5,960,353 13,636,536 164,780 19,761,669

LIABILITIES
Accounts payable 93,469 - 142,768 236,237 Interest payable 709,247 - - 709,247 Deposits payable 140,297 - - 140,297 Unearned revenue 2,184,914 - - 2,184,914 Long-term debt:

Due in one year 296,133 - - 296,133 Due in more than one year 1,499,665 - - 1,499,665 Total liabilities 4,923,725 - 142,768 5,066,493

NET POSITION
Restricted for:

Pensions - 13,636,536 - 13,636,536 Individuals and organizations 1,036,628 - 22,012 1,058,640 Total net position 1,036,628$ 13,636,536$ 22,012$ 14,695,176$ City of Salinas
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2022
See accompanying Notes to the Basic Financial Statements. 43 DRAFT 09.06.2023_v2
Total
Private Purpose Pension Custodial Fiduciary
Trust Funds Trust Fund Funds Funds
ADDITIONS:

Taxes 4,963,103 $ -$ 459,944$ 5,423,047$ Miscellaneous - 438,866 - 438,866 Contributions:

Plan members - 20,839 296,149 316,988 Employer - 208,396 - 208,396 Private donations 1,350,551 - - 1,350,551 Investment earnings (loss) 40,920 (105,406) - (64,486) Less: investment expense - - - - Net investment earnings 40,920 (105,406) - (64,486) Assessments collected for other governments - - - Total additions 6,354,574 562,695 756,093 7,673,362 DEDUCTIONS:

Expenses 1,345,060 - 275,850 1,620,910 Benefit payments - 5,381,582 75,890 5,457,472 Payments on behalf of trustees 1,400,866 - - 1,400,866 Contributions to other agencies 2,421,954 - - 2,421,954 Payments to City 951,900 - - 951,900 Assessments disbursed to other governments - - 459,914 459,914 Total deductions 6,119,780 5,381,582 811,654 12,313,016 Change in net position 234,794 (4,818,887) (55,561) (4,639,654) NET POSITION:

Beginning of year, as restated (Note 23) 801,834 18,455,423 77,573 19,334,830 End of period 1,036,628$ 13,636,536$
22,012$ 14,695,176$
City of Salinas
Statement of Change in Fiduciary Net Position
Fiduciary Funds
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 44 DRAFT 09.06.2023_v2

47 NOTES TO THE BASIC FINANCIAL STATEMENTS
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City of Salinas
Index to the Notes of the Basic Financial Statements
For the Year Ended June 30, 2022

49 Note 1 – Summary of Significant Accounting Policies ............................................................................................. 53

A. Financial Reporting Entity ......................................................................................................................... 53 B. Basis of Presentation, Accounting and Measurement Focus ..................................................................... 54 C. Cash, Cash Equivalents, and Investments .................................................................................................. 58 D. Restricted Cash and Investments ............................................................................................................... 59 E. Fair Value Measurement ............................................................................................................................ 59 F. Interfund Transactions ............................................................................................................................... 59 G. Receivables ................................................................................................................................................ 60 H. Leases Receivable ...................................................................................................................................... 60 I. Special Assessment Districts ..................................................................................................................... 60 J. Prepaid Bond Insurance, Original Issue Discounts and Premiums, Gain/Loss on Refunding ................... 60 K. Capital Assets ............................................................................................................................................. 61 L. Land Held for Resale ................................................................................................................................. 61 M. Restricted Assets ........................................................................................................................................ 62 N. Claims Payable ........................................................................................................................................... 62 O. Compensated Absences .............................................................................................................................. 62 P. Long-Term Debt and Other Long-Term Obligations ................................................................................. 62 Q. Unearned Revenue ..................................................................................................................................... 63 R. Deferred Outflows and Inflows of Resources ............................................................................................ 63 S. Net Position and Fund Balance .................................................................................................................. 63 T. Property Taxes ........................................................................................................................................... 65 U. Pensions ...................................................................................................................... ............................... 66 V. Other Postemployment Benefits (“OPEB”) .............................................................................................. 66 W. Encumbrances ............................................................................................................................................ 67 X. Use of Accounting Estimates ..................................................................................................................... 67 Y. Self-Insurance ............................................................................................................................................ 67 Z. Implementation of New GASB Pronouncements For the Year Ended June 30, 2022 ............................... 67

Note 2 – Stewardship, Compliance, and Accountability .......................................................................................... 68

A. Budgeting ................................................................................................................................................... 68 B. Deficit Fund Balance .......................................................................................................... ....................... 69 C. Debt Compliance................................................................................................................ ........................ 70

Note 3 – Cash and Investments ................................................................................................. ................................. 70

A. Demand Deposits ....................................................................................................................................... 70 B. Investments Authorized by the California Government
Code and the City’s Investment Policy ............................................................................................... 71 C. Risk Disclosures ......................................................................................................................................... 72 D. Fair Value Measurement ............................................................................................................................ 73

Note 4 – Restricted Assets ........................................................................................................................................... 76

Note 5 – Taxes Receivable ........................................................................................................................................... 76

Note 6 – Assessments Receivable ................................................................................................................................ 76

Note 7 – Due from Other Agencies ............................................................................................................................. 77 DRAFT 09.06.2023_v2
City of Salinas
Index to the Notes of the Basic Financial Statements (Continued) For the Year Ended June 30, 2022

50 Note 8 – Leases Receivable .................................................................................................... ..................................... 77

Note 9 – Loans and Notes Receivable ........................................................................................... ............................. 79

Note 10 – Interfund Receivables, Payables, and Transfers ...................................................................................... 80

A. Due From and To Other Funds .................................................................................................................. 80 B. Long-Term Advances ............................................................................................................ .................... 80 C. Transfers ..................................................................................................................... ............................... 81

Note 11 – Capital Assets .............................................................................................................................................. 82

A. Governmental Activities ............................................................................................................................ 82 B. Business-Type Activities ........................................................................................................................... 83 C. Successor Agency ...................................................................................................................................... 83

Note 12 – Land and Properties Held for Resale ........................................................................................................ 84

Note 13 – Long-Term Debt ......................................................................................................................................... 85

A. Governmental Activities ............................................................................................................................ 85 B. Business-Type Activities ........................................................................................................................... 98 C. Successor Agency .................................................................................................................................... 101

Note 14 – Compensated Absences ............................................................................................................................ 104

Note 15 – Risk Management ..................................................................................................................................... 104

Note 16 – Unearned Revenue and Deferred Inflows of Resources, Net of Allowance ......................................... 105

Note 17 – Retirement Programs ............................................................................................................................... 107

A. Summary .................................................................................................................................................. 107 B. CalPERS Agent-Multiple Employer Plans .............................................................................................. 108 C. CalPERS Cost-Sharing Multiple Employer Plan ..................................................................................... 113 D. New York Life Single Employer Retirement Plan .................................................................................. 118 E. ICMA Retirement Corporation Defined Contribution Plan ..................................................................... 121 F. Deferred Compensation Plans .................................................................................................................. 122

Note 18 – Other Postemployment Benefits .............................................................................................................. 124

A. General Information about the OPEB Plan .............................................................................................. 124 B. Net OPEB Liability, OPEB
Expense and Deferred Outflows/Inflows
of Resources Related to OPEB ....................................................................................................... 126

Note 19 – Net Position and Fund Balances .............................................................................................................. 129 A. Government-Wide Financial Statements ................................................................................................. 129 B. Fund Financial Statements ....................................................................................................................... 130

DRAFT 09.06.2023_v2
City of Salinas
Index to the Notes of the Basic Financial Statements (Continued) For the Year Ended June 30, 2022

51 Note 20 – Other Required Disclosures ..................................................................................................................... 130

A. Expenditures Exceeding Appropriations .................................................................................................. 130 B. Restricted Net Position ............................................................................................................................. 130

Note 21 – Joint Venture – Salinas Valley Solid Waste Authority ................................................................ ......... 130

Note 22 – Commitments and Contingencies ............................................................................................................ 131

Note 23 – Prior Period Adjustments ........................................................................................................................ 132

Note 24 – Subsequent Events .................................................................................................................................... 132

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City of Salinas
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022

53 Note 1 – Summary of Significant Accounting Policies

The basic financial statements of the City of Salinas, California (City) have been prepared in conformity with accounting principles generally accepted in the United States of Am erica (GAAP) as applied to governmental entities. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The most significant of the City’s accounting policies are described below.

A. Financial Reporting Entity

The City was incorporated as a chapter City on March 4, 1874. The City operates under a Council Manager form of government and proves the following services as authori zed: Public Safety, Public Works, Recreation Parks, Library and General Government Administrative Services. The City also operates as Airport, a Downtown Parking District, a Sanitary Sewer System, a Water Utility, a Storm Sewer System and an Industrial Waste Facility.

The basic financial statements of the City, include the financial activities of the City (the primary government) and its component unit. The component unit discussed below is included in the City’s reporting entity because of the significance of their operational or financial relationship with the City. The blended component unit, although a legally separate entity, is, in substance, part of the City’s operations and so data from this unit is combined with data of the primary government. The City has no discrete ly presented component units. The City and its blended component unit have June 30 year ends.

The financial statements and accounting policies of the City conform with generally accepted accounting principles applicable to governments in the United States of Am erica. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for estab lishing governmental accoun ting and financial reporting principles. Significant accounting policies are summarized below:

Blended Component Unit

The financial reporting entity consists of the primary government, the City , and its component unit. Component units are legally separate entities for which the elected officials of the primary government are financially accountable. In addition, component units can be other organizations for which the primary government is accountable and their exclusion would cause the reporting en tity’s financial statements to be misleading or incomplete.

Blended component units, although legally separate entities, are, in substance part of the government’s operation and so data from these units are combined with data of the primary government. Discretely presented component units, on the other hand, are reported in a separate column in the combined financial statements to emphasize that they are legally separate from the government.

Although the following are legally separate from the City, they have been “blended” as though they are part of the City because the component unit’s governing body is substan tially the same as the City’s and there is a financial benefit or burden relationshi p between the City and the component unit; management of the City has operational responsibilities for the component units; and/or the component units provide services entirely, or almost entirely, to the City or otherwise exclusively, or almost exclus ively, benefits the City, even though it does not provide services directly to it.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

54 Note 1 – Summary of Significant Accounting Policies (Continued)

A. Financial Reporting Entity (Continued)

Blended Component Units (Continued)

The Salinas Public Financing Authority (Authority) – The Authority was established October 6, 1992 pursuant to a Joint Exercise of Powers Agreement by and between the City and the City of Salinas Redevelopment Agency, which is now the Salinas Successor Agency to the former Redevelopment Agency. It was established to refund Central City Revitalization Project tax allocation bonds. The Authority’s pur pose is to assist with financing or refinancing of certain public capital facilities within the City.

The Authority is controlled by the City and has the same governing body as the City, which also performs all accounting and administrative functions for the Authority. The financial activities of the Authority are included in the City’s Debt Service and Enterprise Funds. A financial report is not issued by the Authority.

B. Basis of Presentation, Accounting and Measurement Focus

The accounts of the City are organized on the basis of f unds, each of which is considered a separate accounting entity. The operations of each fund are accounted for by pr oviding a separate set of self-balancing accounts that comprise its assets, deferred outflows of resources, liabilities, deferred inflows of resources, fund equity, revenues and expenditures or expenses, as appropriate. Fund accounting segregates funds according to their intended purpose and is used to aid management in demonstrating compliance with finance-related legal and contractual provisions.

The minimum number of funds is maintained in accordance with legal and managerial requirements.

Government-Wide Financial Statements

The City’s Government-Wide Financial Statements include a Statement of Net Position and a Statement of Activities and Changes in Net Position. These statements present summaries of governmental and business-type activities for the City accompanied by a total column. Fiduc iary activities of the City are not included in these statements.

These financial statements are presented on an “ economic resources” measurement focus and the accrual basis of accounting. Accordingly, all of the City’s assets and liabilities, including capital asset s, as well as infrastructure assets, and long-term liabilities, are included in the acco mpanying Statement of Net Position. The Statement of Activities presents changes in Net Position. Under the accr ual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred. Under the accrual basis of accounting, revenues, expenses, gains, losses, assets, deferred outflows of resources, liabilities, and deferred inflows of resources resulting from exchange and exchange-like transactions are recognized when the exchange takes place. Revenues, expe nses, gains, losses, assets, deferred outflows of resources, liabilities and deferred inflows of resources resulting from non-exchange transactions are recognized in accordance with the requirements of U.S. GAAP.

Program revenues include charges for ser vices, special assessments, and payments made by parties outside of the reporting government's citizenry if that money is restricted to a particular program. Program revenues are netted with program expenses in the statement of activities to present the net cost of each program. Program revenues for the City are classified in three categories:

 Charges for services
 Operating grants and contributions
 Capital grants and contributions
DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

55 Note 1 – Summary of Significant Accounting Policies (Continued)

B. Basis of Presentation, Accounting and Measurement Focus (Continued)

Government-Wide Financial Statements (Continued)

Certain eliminations have been made in regards to interfund activities, pa yables and receivables. All internal balances in the Statement of Net Po sition have been eliminated except those representing balances between the governmental activities and the business-type activities, which are presented as internal balances and eliminated in the total primary government column. In the Statement of Activities and Changes in Net Position, internal service fund transactions have been eliminated; however, tho se transactions between governmental and business-type activities have not been eliminated. The following interfund activities have been eliminated:

 Due to/from other funds
 Advances to/from other funds
 Transfers in/out

Governmental Fund Financial Statements

Governmental Fund Financial Statements include a Balance Sheet and a Statement of Revenues, Expenditures and Changes in Fund Balances. An accompanying schedule is presented to reconcile and explain the differences in Net Position as presented in these statements to the net position presented in the Government-Wide Financial Statements. The City has presented all major funds that met the applicable criteria.

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

Under the modified accrual basis of accounting, revenues are recognized in the accounting period in which they become both measurable and available to finance expend itures of the current period. Measurable means that the amounts can be estimated, or otherwise determined. Available means that the amounts were collected during the reporting period or soon enough thereafter to be availa ble to finance the expenditures accrued for the reporting period. The City uses an availability period of 60 days for all revenues except grants, which use a six-month availability period.

Sales taxes, property taxes, franchise taxes, gas taxes, motor vehicle in-lieu, transient occupancy taxes, grants and interest associated with the current fiscal period are all c onsidered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period to the extent normally collected with in the availability period.

Other revenue items are considered to be measurable and available when cash is received by the government.

Revenue recognition is subject to the measurable and av ailable criteria for the governmental funds in the fund financial statements. Exchange transactions are recognized as revenues in the period in which they are earned (i.e., the related goods or services are provided). Locally imposed derived tax revenues are recognized as revenues in the period in which the underlying exchange transaction upon which they are based takes place.

Imposed non-exchange transactions are recognized as revenues in the period for which they were imposed. If the period of use is not specified, they are recognized as revenues when an enforceable legal claim to the revenues arises or when they are received, whichever occurs first. Government-mandated and voluntary non-exchange transactions have been recognized as revenues when all applicable eligibility requirements have been met.

The Reconciliation of the Fund Financial Statements to the Government-Wide Financial Statements is provided to explain the differences created by the integrated approach of GASB Statement No. 34.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

56 Note 1 – Summary of Significant Accounting Policies (Continued)

B. Basis of Presentation, Accounting and Measurement Focus (Continued)

Governmental Fund Financial Statements (Continued)

The City reports the following major governmental funds:

 General Fund is the City’s primary operating fund. It acc ounts for all financial resources of the general government, except those required to be accounted for in any other funds.

 American Rescue Plan Act (ARPA)Special Revenue Fund On March 11, 2021, President Biden signed the American Rescue Plan Act, which will provide the City with approximate ly $51 million in relief funds. This fund accounts for the revenues and expenditures of ARPA proceeds.

 Housing and Urban Development Grant Special Revenue Fund accounts for the use of Community Development Block Grant funds received from the fe deral government. Other revenues in this fund include repayments of commercial and residential loans and rental income from City property. Funds are used for programs or projects that increase affordable housing and benefit people with special needs such as senior and handicapped citizens.

Proprietary Fund Financial Statements

Proprietary funds are accounted for using the “ economic resources” measurement focus and the accrual basis of accounting. Accordingly, all assets and liabilities (whether current or noncurrent) are included on the Statement of Net Position. The Statement of Revenues, Expenses and Changes in Net Position presents increases (revenues) and decreases (expenses) in total net position. Under the accrua l basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred.

Proprietary funds distinguish opera ting revenues and expenses from nonopera ting items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the proprietary funds are charges to customers for sales and services. Operating expenses for the proprietary funds include the costs of sales and services, administrative expenses and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses.

A separate column representing internal service funds is also presented in these statem ents. However, internal service balances and activities have been combined with the governmental activities and business-type activities in the Government-Wide Financial Statements.

The City reports the following major enterprise funds:

 Airport Fund is used to account for the enterprise operations of the City-owned airport.

 Industrial Waste Fund is used to account for the enterprise operations of the City-operated Industrial Wastewater Treatment Facility.

 Sanitary Sewer Fund is used to account for the maintenance of the City's sanitary sewer collection system, which is funded by user fees and by the Monterey Regional Water Pollution Control Agency sewer user fees.

 Downtown Parking District Fund – is used to account for revenues, operating expenses and debt service associated with the City’s parking facilities. The City’s paid parking facilities include the Monterey Street Parking Structure, the Salinas Street Garage and four parking lots.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

57 Note 1 – Summary of Significant Accounting Policies (Continued)

B. Basis of Presentation, Accounting and Measurement Focus (Continued)

Proprietary Fund Financial Statements (Continued)

The City’s internal service funds include five individual funds which provide services directly to other City funds.

These areas of service include risk management, general in surance, workers’ compensation, general liability, and fleet maintenance. The Internal Service Funds account for financing of goods and services provided by one department to other departments of the City on a cost-reimbursement basis.

Fiduciary Fund Financial Statements

Fiduciary fund financial statements include a Statement of Net Position and a Statement of Changes in Fiduciary Net Position. The City’s fiduciary funds represent private purpose trust funds, pension trust funds, and custodial funds. These funds are accounted for on the full accrual basis of accounting.

Fiduciary fund types are accounted for according to the nature of the fund.

Private Purpose Trust Funds are a fiduciary fund type u sed to account for resources held and administrated under trust or similar arrangement for the benefits of individua ls, private organizations, or other governments. The City reports the following private purpose trust funds:

 Successor Agency Redevelopment Obligation Retirement Fund was created to serve as a custodian for the assets and to wind down the affairs of the RDA on Februa ry 1, 2012, pursuant to Assembly Bill x1 26. Its purpose is to expeditiously wind down the affairs of the dissolved Community Development Commission of the City of Rohnert Park (Commission) subject to the direction of a seven-member Oversight Board. This fund accounts for the receipt of property tax revenues pursuant to the Redevelopment Dissolution Act and the assets transferred from the Commission. The Succes sor Agency’s assets can only be used to pay enforceable obligations in existence at the date of dissolution pursuant to the Recognized Obligation Payment Schedules approved by the California Department of Finance (DOF) under the Redevelopment Dissolution Act.

 Successor Agency Administration – This fund accounts for the administrative activities of the Successor Agency to the former Salinas Rede velopment Agency which was dissolved on February 1, 2012 in accordance with AB 1x26 (enacted June 28, 2011).

 Other Private Purpose Trust Funds – These funds are used to account for other trust arrangements not properly reported in a pension trust fund under whic h principal and income benefit individuals, private organizations, or other governments. The City acco unts for the following trust funds: Community Center, Monterey Regional Water Pollution Control Agency (MRWPCA) Fees, Sales Tax, Payroll Taxes, Developer Deposits, Evidence Room, Construction Bonds, Mont erey County Tourism Improvement District, Leadership Salinas, and miscellaneous.

Pension Trust Fund is used to account for resources that are required to be held in trust for the members and beneficiaries of defined benefit pension plans, defined contribution plans, or other employee benefit plans. The City’s only pension trust fund is the Deferred Compensation Fund; which allows City employees to invest in trust deeds that are managed by the City with the oversight of an investment committee that is made up of representatives from each of the bargaining units.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

58 Note 1 – Summary of Significant Accounting Policies (Continued)

B. Basis of Presentation, Accounting and Measurement Focus (Continued)

Fiduciary Fund Financial Statements (Continued)

Custodial Funds are used to account for assets held in an agent capacity by the City for individuals, private organizations, other governments and/or other funds that are not required to be repor ted in pension trust funds, investment trust funds, or private-purpose trust funds.

C. Cash, Cash Equivalents, and Investments

Cash and Cash Equivalents - Cash and cash equivalents are considered to be amounts in demand deposits, and short-term investments with original, maturity of three months or less from the date of acquisition. For purposes of both the balance sheet and statements of cash flows, cash and cash equivalents include not only currency on hand, but deposits in the City’s cash and investment pool . These deposits have the same characteristics for the participating funds as demand deposit accounts, in that the funds may deposit additional cash at any time and also effectively withdraw cash at any time without prior noti ce or penalty. Cash and cash equivalents also include restricted cash and money market funds held by fiscal agents. For purposes of cash flow s, the City considers all liquid market investments with maturities of one year or less at time of purchase to be cash equivalents. All other investments are stated at fair value. Market value is used as fair valu e for those securities for which market quotations are readily available.

The City pools cash resources from all funds in order to facilitate and maximize the management of cash. The balance in the pooled cash account is available to meet cu rrent operating requirements. Cash in excess of current requirements is invested in various interest-bearing accounts and other fixed income investments with varying terms. Interest earned on investments is allocated to all funds based on average cash and investment balances.

Investments are presented at fair value except as noted below. Fair value is the amount at which a financial instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. Money market investments (such as short–term , highly liquid debt instruments including bankers’ acceptances) and securities (notes, bills, and obligations of the U.S. government and its agencies), and participating interest-earning investment contracts (such as negotiabl e certificates of deposit and repurchase agreements) that have a remaining maturity at the time of purchase of one year or less, are reported at amortized cost, which approximates fair value.

For purposes of the statement of cash fl ows, amounts reported as cash and cas h equivalents, include amounts on deposit in the City pool and any short-term, highly liqui d investments that are both readily convertible to known amounts of cash or so near their maturity that they present insignificant risk of changes in value because of changes in interest rates.

Investment held in Local Agency Investment Fund - The City participates in the Local Agency Investment Fund (“LAIF”), an investment pool managed by the State of Califor nia. LAIF has invested portions of the pool funds in structured notes and asset-backed securiti es. LAIF’s investments are subject to credit risk with the full faith and credit of the State of California collateralizing these inv estments. In addition, these structured notes and asset- backed securities are subject to market risk as a result of changes in interest rates.

LAIF determines fair value on its investments portfolio based on market quotations for those securities where market quotations are readily available and based on amortized cost or best estimate for those securities where market value is not readily available.

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City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

59 Note 1 – Summary of Significant Accounting Policies (Continued)

C. Cash, Cash Equivalents, and Investments (Continued)

The City valued its investments in LAIF as of June 30, 2022, by multiplying its account balance with LAIF times a fair value factor determined by LAIF for all LAIF participants by total aggregate amortized cost.

Other Investments - Investments in nonparticipating interest earning contracts (certificate of deposits) are reported at cost, and all other investments are reported at fair va lue. Fair value is defined as the amount the City could reasonably expect to receive for an investment in a current sale between a willing buyer and seller and is generally measured by quoted market prices.

Deferred Compensation - The Deferred Compensation Plan is invested in deeds of trust secured by real or personal property and in real estate holdings. The trust deeds are considered nonparticipating interest earning investments and are reported at fair market value.

D. Restricted Cash and Investments

Certain restricted cash and investments are held by fiscal agents or the City for the redemption of bonded debt and for acquisition and construction of certain capital projects.

E. Fair Value Measurement

U.S. GAAP establishes a framework for measuring fair value, and establishes disclosures about fair value measurement. Investments, unless otherwise specified, recorded at fair value in the Statements of Net Position, are categorized based upon the level of judgment associated with the inputs used to measure their fair value.

F. Interfund Transactions

Interfund transactions are reflected as loans, services pr ovided, reimbursements and/or transfers. Loans and balances related to unsettled service transactions are reported as receivables and payables as appropriate, are subject to elimination upon consolidation of similar fund types, and are referred to as either “due to/from other funds,” i.e., the current portion of interfund loans and unsettled service transactions, or “advances to/from other funds,” i.e., the noncurrent portion of interfund loans. Any residual bala nces outstanding between the governmental activities and the business-type activities are reported in the government-wide financial statements as “internal balances.”

Services provided are deemed to be at market or near market rates and are treated as revenues and expenditures/expenses. Reimbursements are defined as wh en one fund incurs a cost, charges the appropriate benefiting fund and reduces its related cost as a reimbursement. All other interfund transactions are treated as transfers. Transfers between governmental or proprietary funds are netted as part of the reconciliation to the government-wide presentation.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

60 Note 1 – Summary of Significant Accounting Policies (Continued)

G. Receivables

All receivables are reported at their gross value and, wh ere appropriate, are reduced by the estimated portion that is expected to be uncollectible. Invoices that remain unpaid after 90 days may be referred to collections. An invoice sent to collection is written off.

H. Leases

The City is a lessor for leases of land and recognizes leases receivable and deferred inflows of resources in the financial statements. Variable payments based on future performance or usage of the underlying asset are not included in the measurement of the lease receivable.

At the commencement of a lease, the lease receivable is measured at the present value of payments expected to be received during the lease term. Subsequently, the lease rece ivable is reduced by the principal portion of lease payments received. The deferred inflows of resources are initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date. Subsequently, the deferred inflows of resources are recognized as revenue over the life of the lease term in a systematic and rational method.

Key estimates and judgments include how the City determines (1) the discount rate it uses to discount the expected lease receipts to present value, (2) lease term, and (3) lease receipts.

 The City uses the average of the LAIF rate and the incremental borrowing rate (IBR) provided by our financial institution at July 1, 2021 for existing leases or the current rate at the time a new lease is executed.

 The lease term includes the noncancelable period of the lease plus any option periods that are likely to be exercised.

 Lease receipts included in the measurement of the lease receivable is composed of fixed payments from the lessee.

The City monitors changes in circumstances that would require a remeasurement of its lease and will remeasure the lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the amount of the lease receivable.

I. Special Assessment Districts

Special assessments are recorded as receivables when they become a lie n on property. Special assessments not considered available are recorded as receivables and offset by unearned reve nues. In general, special assessments and special tax bonds are fully secured by liens against the privately owned properties benefited by the improvement for which the bonds were issued. There is no reserve for delinquent receivables since priority liens exist against the related properties and hence the City’s management believes value will ultimately be received by the City.

J. Prepaid Bond Insurance, Original Issue Discounts and Premium, Gain/Loss on Refunding

Prepaid bond insurance costs are amortized using the straight-line method over the life of the bonds. Amortization of these balances are recorded as a component of operating expenses.

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City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

61 Note 1 – Summary of Significant Accounting Policies (Continued)

J. Prepaid Bond Insurance, Original Issue Discounts and Premium, Gain/Loss on Refunding (Continued)

In the government-wide, proprietary fund and fiduciary fund financial statements, long-term debt and other long- term obligations are reported as liabilities in the app licable governmental activities, business-type activities, proprietary fund and fiduciary fund financial statements. Bond premiums and discounts are deferred and amortized over the life of the bonds. Bonds payable are reported net of the applicable bond premium or discount. Original issue premiums are amortized using the straight-line method over the life of the bonds. Gains or losses from refunding of debt are reported as deferred inflows or out flows of resources and amortized over the shorter of the life of the refunded debt or new refunding debt. Amortiza tion of these balances are recorded as a component of interest expense.

In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. Issuance costs, whether or not w ithheld from the actual debt proceeds received, are reported as debt service expenditures.

K. Capital Assets

Capital assets include land, buildings, improvements, vehicles and equipment, infrastructure, and all other tangible and intangible assets that are used in operations and that have initial useful lives in excess of one year. Capital assets are reported in the applicable governmental or business-type activity columns in the government-wide financial statements, the proprietary funds' statement of net position, and the private-purpose trust fund. Capital assets are defined as assets with an initial individual cost of more than $10,000 for general capital assets and $100,000 for major infrastructure assets, and an estimated useful life in excess of one year.

Such assets are recorded at historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value, market based entry price at the time of contribution. Capital outlay is recorded as expenditures of the governmental funds and as assets in the government- wide financial statements to the extent the City's capitalization threshold is met. Amortization of assets ac quired under capital leases is based on the shorter of the lease term or the estimated useful life of the asset and is included in depreciation and amortization.

Buildings, improvements, infrastructure, vehicles and equi pment, and furniture and fixtures are depreciated using the straight-line method (depreciation is calculated starting with the month following the date the asset was placed in service) over the following estimated useful lives:

Asset Type Years
Buildings and improvements 20-50
Other improvements 15-45
Infrastructure 10-50
M achinery and equipment 5-20

L. Land Held for Resale

Land held for resale is being carried at cost, but no greater than the net realizable value. In the fund financial statements, this amount is recorded as a restricted por tion of fund balance due to externally imposed grantor restrictions.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

62 Note 1 – Summary of Significant Accounting Policies (Continued)

M. Restricted Assets

Assets that are restricted for specific uses by bonded debt requirements, grant provisions or other requirements are classified as restricted because their use is limited by applicable bond covenants or agreements.

N. Claims Payable

Claims and judgments are recognized as expenditures when it is probable that the liability has been incurred and the amount of the loss can be reasonably estimated. This liability is recorded in the internal service fund that accounts for the City’s self-insurance activities.

O. Compensated Absences

Vacation, compensatory time, and related benefits are accr ued as determined by the agreement between the City and the respective employees' collective bargaining group. For governmental funds, compensated absence obligations are recorded in the appropriate governmental funds when due. The portion not currently due is recorded in the government-wide financial statements. For propr ietary funds, compensated ab sences are expensed when earned by employees. At year-end, the accrued but unpaid compensated absence obligations are recorded as current and non-current liabilities in the appropriate proprietary funds.

Eligible employees may accrue a maximum of 600 annual leave hours (75 days). Any hours accumulated in excess of 600 hours are paid at the employee’s adjusted hourly rate of pay. For the Firefighter group the maximum is 840 hours for 56 hour shift employees and 600 for 40 hour shif t employees. Employees with fewer than 20 years of service may request pay in lieu of annual leave up to a maximum of 10 days. Employees with more than 20 years of service may request a maximum of 15 days pay in lieu of annual leave.

Government-Wide Financial Statements

For governmental and business-type activities, compensated absences are recorded as expenses when earned.

Governmental Fund Financial Statements

For governmental funds, compensated absences are recorded as expenditures in the year paid. The General Fund is typically used to liquidate compensated absences. In proprietary funds, comp ensated absences are expensed to the various funds in the period they are earned, and such fund’s share of the unpaid liability is recorded as a long-term liability of the fund.

P. Long-Term Debt and Other Long-Term Obligations

Government-Wide Financial Statements and Proprietary Fund Financial Statements

In the Government-Wide Financial Statements and the propr ietary fund types in the Fund Financial Statements, long-term debt and other obligations are reported as liabilities in the applicab le governmental activities, business- type activities, or proprietary fund statement of net positions. Bond premiums and discounts are deferred and amortized over the life of the bonds using effective interest methods. Bonds payable are reported net of the applicable bond premium or discount. In the governmental funds statement of revenue, expenditures and changes in fund balance, issuance of debt is recorded as another financing source (use) in the respective fund. Issuance costs and payment of principal are reported as debt service expenditures.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

63 Note 1 – Summary of Significant Accounting Policies (Continued)

P. Long-Term Debt and Other Long-Term Obligations (Continued)

Governmental Fund Financial Statements

The governmental fund financial statements do not present long-term debt but are show n in the Reconciliation of the Governmental Funds Balance Sheet to the Governme nt-Wide Statement of Net Position. Governmental fund types recognize bond premiums and discounts 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 issuances are reported as other financing uses. Debt issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.

Q. Unearned Revenue

Unearned revenues arise when the City receives resources before it has a legal claim to them, as when grant monies are received prior to incurring qualifying expenditures or when monies are received before the related services are performed. In subsequent periods, when both revenue recognition criteria are met or when the City has a legal claim to the resources, the liability for unearned revenue is removed from the balance sheet and revenue is recognized.

R. Deferred Outflows and Inflows of Resources

The Statement of Net Position and Balance Sheet – Governmental Funds reports separate sections for Deferred Outflows of Resources, and Deferred In flows of Resources, when applicable.

Deferred Outflows of Resources – represent a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/ expenditure) until then.

Deferred Inflows of Resources – represent an acquisition of net position th at applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time.

S. Net Position and Fund Balance

Net Position Classifications

In the government-wide financial statements, net position is classified in three categories:

Net Investment in Capital Assets – This category groups all capital assets, including infrastructure, into one component of net position. Accumulated depreciation, outstanding balances of debt and any debt-related deferred outflows and inflows of resources that are attributable to the acquisition, constructi on, or improvement of these assets reduce the balance of this category.

Restricted Net Position – This category consists of restricted asse ts reduced by liabilities and deferred inflows of resources related to those assets. Enabling legislation auth orizes the City to assess, levy, charge, or otherwise mandate payment of resources and includes a legally enforceable requirement that those resources be used only for the specific purposes stipulated in the legislation.

Unrestricted Net Position – This category represents net position of the City that is not restricted for any project or purpose and does not meet the criteria for “net investment in capital assets.”

The City first applies restricted resources when an expense is incurred for purposes for which both restricted and unrestricted net position are available.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

64 Note 1 – Summary of Significant Accounting Policies (Continued)

S. Net Position and Fund Balance (Continued)

Fund Balances Classifications

As prescribed by U.S. GAAP, governmental funds report fund balance in classifications based primarily on the extent to which the City is bound to honor constraints on the specific purposes for which amounts in the funds can be spent. As of June 30, 2022, fund balances for governmental funds are made up of the following:

Nonspendable Fund Balance – includes amounts that cannot be spent because they are either (a) not in a spendable form, or (b) legally or contractually required to be maintained intact. The “not in spendable form” criterion includes items that are not expected to be converted to cash, fo r example: prepaid items and long-term loans and notes receivable.

Restricted Fund Balance – includes amounts with constraints placed on their use that are either (a) externally imposed by creditors, grantors, contributors, or laws or regulations of other governm ents; or (b) imposed by law through constitutional provisions or enabling legislation. Restrictions may effectively be changed or lifted only with the consent of resource providers.

Committed Fund Balance – includes amounts that can only be used for the specific purposes determined by a formal action of the City’s highest level of decision-making aut hority. The City Council is the highest level of decision- making authority for the City that can, by adoption of an ordinance, commit fund balances. Commitments may be changed or lifted only by the City Council taking the sam e formal actions that imposed the original constraint occurring no later than the close of the reporting period.

Assigned Fund Balance – includes amounts intended to be used by the City for specific purposes through budgetary actions or delegation of authority by the City Council. Intent is expressed by the City Council or an official to whom the City Council has delegated the authority (generally, the City Manager) to assign amounts to be used for specific purposes. This is also the classification for residual funds in the governmental funds other than General Fund.

Unassigned Fund Balance – includes amounts that have not been restricted, committed, or assigned. This includes the residual fund balance of General Fund and residual fund deficits of other governmental funds.

In circumstances when an expenditure is made for a purpose for which amounts are available in multiple fund balance categories, fund balance is depleted in the order of restricted, committed, assigned, and unassigned.

T. Property Taxes

Property taxes are collected on behalf of and remitted to the City by the County of Monterey (the “County”). The amount of property tax levies is restricted by Article 13 A of the California State Constitution (commonly referred to as Proposition 13). The County assesses property values, le vies, bills, and collects the related property taxes as follows:

Secured Unsecured
Lien Dates January 1 January 1
Levy Dates January 1 January 1
Due Dates 50% on November 1 July 1
50% on February 1
Delinquent after December 10 (for November) August 31
April 10 (for February)
DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

65 Note 1 – Summary of Significant Accounting Policies (Continued)

T. Property Taxes (Continued)

The City does not have the ability to control the levy rate or the amount of property taxes remitted by the County because these are governed by State law.

The City has not elected to participate in the “Teeter Plan” offered by the County whereby cities receive 100% of secured property and supplemental propert y taxes levied in exchange for foregoing any interest and penalties collected on the related delinquent taxes. The City retain s the right to any interest and penalties collected on the related delinquent taxes. Accordingly, property tax revenues are recognized in the fiscal period for which they are levied and collected, adjusted for any amounts deemed unco llectible and amounts expected to be collected more than 60 days after the fiscal year.

General property taxes are based on either a flat 1% rate applied to the fiscal year 1976 full value of the property or on 1% of the sales price of the property on sales tran sactions and construction that occur after the fiscal year 1976 valuation. Assessed values on properties (exclusive of increases related to sales and construction) can rise at a maximum of 2% per year depending on increases in the consumer price index.

U. Pensions

For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiducia ry net position of the plans and additions to/deductions from the plans’ fiduciary net position have been determined on the same basis as they are reported by the plans. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with benefit terms. Investments are reported at fair value.

The following timeframes are used for pension reporting:

CalPERS Pension Plans
Valuation date June 30, 2020
Measurement date June 30, 2021
Measurement period July 1, 2020 to June 30, 2021

NY Life Pension Plan
Valuation date September 1, 2021
Measurement date September 1, 2021
Measurement period October 1, 2020 to September 30, 2021

Gains and losses related to changes in total pension liab ility and fiduciary net position are recognized in pension expense systematically over time. The first amortized am ounts are recognized in pension expense for the year 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 r ecognized in future pension expense. The amortization period differs depending on the source of the gain or loss. The difference between projected and actual earnings is amortized straight-line over 5 years. All other amounts are amortized straight-line over the average expected remaining service lives of all members that are provided with benefits (active, inactiv e, and retired) as of the beginning of the measurement period.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

66 Note 1 – Summary of Significant Accounting Policies (Continued)

V. Other Postemployment Benefits (“OPEB”)

For the purpose of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, informati on about the fiduciary net position of the City’s OPEB Plan and additions to/deductions from the OPEB Plan’s fiduciary net position have been determined on the same basis as they are reported by the Plan. For this purpose, the OPEB Plan recognizes benefit payments when due and payable in accordance with the benefit terms. Investment s are reported at fair value, except for money market investments, which are reported at amortized cost.

The following timeframes are reported OPEB reporting:

OPEB
Valuation date June 30, 2020
Measurement date June 30, 2021
Measurement period July 1, 2020 to June 30, 2021

Gains and losses related to changes in total OPEB liab ility and fiduciary net position are recognized in OPEB expense systematically over time. The first amortized amounts are recognized in OPEB expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to OPEB and are to be recognized in future OPEB expense. The amortization period differs depending on the sources of gain or loss. The difference between project ed and actual earnings is amortized on a straight-line basis over 5 years. All other amounts are amortized on a st raight-line basis over the av erage expected remaining service lives of all members that are provided with benefits (active, inactive, and retir ed) at the beginning of the measurement period.

W. Encumbrances

Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is employed as an extension of formal budgetary integration in the General, Spec ial Revenue, and Capital Projects Funds. Encumbrances outstanding at year-end are reported as reservations of fund balance since they do not constitute expenditures or liabilities.

X. Use of Accounting Estimates

The preparation of the basic financial statements in c onformity with U.S. GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities. In addition, estimates affect the reported amount of revenues and expenses. Actual results could differ from these estimates and assumptions.

Y. Self-Insurance

The City is self-insured for workers’ compensation, ge neral, automobile, and public liability claims. The City’s estimated liability for claims as of June 30, 2022 is based on the claim manager’s estimate of probable losses plus an amount estimated for incurred but not reported claims. An Internal Service Fund is used to account for the collection of premiums from various City departments related to workers’ compensation claims and general claims liabilities. Premiums are established based on historical cl aims experience. Additionally, the City contracts with third party administrators for claims management.

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City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

67 Note 1 – Summary of Significant Accounting Policies (Continued)

Z. Implementation of New GASB Pronouncements For the Year Ended June 30, 2022

During fiscal year ended June 30, 2022, the City implemented the following new GASB Pronouncements:

GASB Statement No. 87 – In June 2017, GASB issued Statement No. 87, Leases (GASB Statement No. 87), to better meet the information needs of financial statement users by improving accounting and financial reporting for leases by governments. This statement increases the usefuln ess of governments’ financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract. It also establishes a single model for lease accounting based on the foundational principle that leases are financings of the right to use an underlying asset. Implementation of this St atement had a significant effect on the City’s financial statements for the fiscal year ended June 30, 2022.

GASB Statement No. 89 – In June 20 18, GASB issued Statement No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period . This Statement establishes accounting requirements for interest cost incurred before the end of a construction period. Such in terest cost includes all interest that previously was accounted for in accordance with the requirements of pa ragraphs 5–22 of Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contai ned in Pre–November 30, 1989 FASB and AICPA Pronouncements, which are superseded by this Statement. 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. Implementation of this Statement did not have a significant effect on the City’s financial statements for the fiscal year ended June 30, 2022.

GASB Statement No. 92 – In January 2020, GASB issued Statement No. 92, Omnibus 2020. The primary objectives of this Statement are to enhance comparability in accounting and financial reporting and to improve consistency of authoritative literature by addressing practice issues th at have been identified during implementation and application of certain GASB Statements. Implementation of this Statement did not have a significant effect on the City’s financial statements for the fiscal year ended June 30, 2022.

GASB Statement No. 93 – In March 2020, GASB issued Statement No. 93, Replacement of Interbank Offered Rates. Some governments have entered into agreements in which variable payments made or received depend on an interbank offered rate (IBOR)—most notably, the London Interbank Offered Rate (LIBOR). As a result of global reference rate reform, LIBOR is expected to cease to exis t in its current form at the end of 2021, prompting governments to amend or replace financial instruments fo r the purpose of replacing LIBOR with other reference rates, by either changing the reference rate or adding or changing fallback provisions related to the reference rate.

The objective of this Statement is to address those and other accounting and financial reporting implications that result from the replacement of an IBOR. Implementation of th is Statement did not have a significant effect on the City’s financial statements for the fiscal year ended June 30, 2022.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

68 Note 1 – Summary of Significant Accounting Policies (Continued)

Z. Implementation of New GASB Pronouncements For the Year Ended June 30, 2022 (Continued)

GASB Statement No. 97 – In June 2020, GASB issued Statement No. 97, Certain Component Unit Criteria, and Accounting and Financial Reporting fo r Internal Revenue Code Section 457 Deferred Compensation Plans – An Amendment of GASB Statements No. 14 and No. 84, and a Supersession of GASB Statement No. 32 . The primary objectives of this Statement are to (1) increase consistenc y and comparability related to the reporting of fiduciary component units in circumstances in which a potential component unit does not have a governing board and the primary government performs the duties that a governi ng board typically would pe rform; (2) mitigate costs associated with the reporting of certain defined cont ribution pension plans, de fined contribution other postemployment benefit (OPEB) plans, and employee benefit plans other than pension plans or OPEB plans (other employee benefit plans) as fiduciary component units in fiduciary fund financial stat ements; and (3) enhance the relevance, consistency, and comparability of the accoun ting and financial reporting fo r Internal Revenue Code (IRC) Section 457 deferred compensation plans (Section 457 pl ans) that meet the definition of a pension plan and for benefits provided through those plans. Implementation of this Statement did not have a significant effect on the City’s financial statements for the fiscal year ended June 30, 2022.

Note 2 – Stewardship, Compliance, and Accountability

A. Budgeting

The Budget is prepared by the City Manager and adopt ed by City Council. Formal budgetary integration was employed as a management control device during the fiscal year for the General Fund, Special Revenue Funds, and Capital Projects Funds. The City Manager may transfer budget appropriations between departments and Department Directors may transfer appropriations between program s and accounts within their individual departments and divisions, but only the Council by resolution may appropriate funds from reserves or fund balances.

Budgets for General, Special Revenue and Capital Projects Funds are adopted on a basis consistent with generally accepted accounting principles (GAAP). Reserves for future lease commit ments have been established for accounting purposes and the fund balance is reserved for the total lease commitment consistent with budget policies.

Budget policy excludes taxes, interest, and accounts receiva ble assets, which are not currently available resources for budget purposes, and condemnation deposits which are returned upon right of way acquisition.

Expenditures may not legally exceed bu dgeted appropriations at the governme nt level. Budgeted amounts shown are as originally adopted or as amended by the City Council during the year. Additional supplementary appropriations were adopted during the mid-year review.

Appropriations lapse at fiscal year end and then are re-budgeted for the coming year. Project-length financial plans are adopted for all capital projects funds and appropriati ons are carried forward until project completion. Grant funds are carried forward until the grant expires.

Encumbrances represent commitments related to unperformed contracts for goods or services. Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applic able appropriation, is employed as an extension of formal budgetary integration in the governmental funds.

Encumbrances outstanding at year-end are recorded as reservations of fund balance and do not constitute expenditures or liabilities because the commitments will be honored during the subsequent year.

For additional information on budgetary policy and control see Required Supplementary Information.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

69 Note 2 – Stewardship, Compliance, and Accountability (Continued)

B. Deficit Fund Balances and Net Position

At June 30, 2022, the following funds had a deficit fund balance or deficit net position:

Fund Type Fund Deficit
Governmental Housing and Urban Development Grant (2,772,187)$ Governmental Emergency Medical Services (378,482)
Governmental Traffic Safety (27,135)
Governmental Assessment District Administration (2,178) Enterprise Downtown Parking District Fund (5,494,230)
Internal Service Fund General Liability (3,014,068)

Governmental Funds – Housing and Urban Development Grant Fund The deficit net position in the Housing and Urban Development Grant Fund of $2,772,187 is a result of an increase in Community and Development and related Housing reimbursable grants in Emergency Shelter Grants related to COVID 19 mitigation program and relate d expenditures. This deficit will decline as claims are submitted for reimbursement to state and federal agencies and becomes available.

Non-Major Funds
The deficit fund balances in the Special Revenue Funds Emergency Medical Services f und of $378,482 is due to increased expenditures in emergency equipment and supplies. The deficit fund balance in the Traffic Safety Special Revenue Fund of $27,135 is a result of increased services in vehicle code violations provided by Monterey County.

These deficits will decline as claims are submitted for reimbursement to state and federal agencies and unavailable funds become available. The deficit fund balance in the Debt Service Funds Assessment District Administration fund of $2,178 is due to amounts owed to the General Fund. This will be cleared in fiscal year 2023 and the fund will be closed out.

Enterprise Funds – Downtown Parking District Fund
The deficit net position in the Downtown Parking District Fund of $5,494,230 is a result of operating cost in excess of operating revenues and the long-term lease payable amounting to $9,012,000. This deficit will continue to decline over time as the lease payable is collected.

Internal Service Funds
The deficit net position in General Liability internal service fund of $3,014,068 is the result of insurance costs exceeding charges for services in the fund. The City is reevaluating their internal service fund allocations in order to ensure that charges for services in internal service funds are sufficient to cover the costs of providing services moving forward.

C. Debt Compliance

There are a number of limitations and restrictions contained in the various bond indentures. The City believes it is in compliance with all significant limitations and restrictions.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

70 Note 3 – Cash and Investments

Cash and investments are presented in the accompanying financial statements at June 30, 2022 as follows:

Fiduciary Funds
Governmental Business-Type Statement of
Activities Activities Total Net Position Total
Cash and investments 216,282,792$ 16,403,450$ 232,686,242$ 13,419,418$ 246,105,660$ Restricted cash and investments 1,077,537 6,987 1,084,524 6,151,577 7,236,101 Total cash and inv estments 217,360,329$ 16,410,437$ 233,770,766$ 19,570,995$ 253,341,761$ Government-Wide Statement of Net Position

Cash and investments at June 30, 2022, consisted of the following:

Cash and Cash Equivalents:

Cash on hand 25,000$
Demand accounts at banks 6,260,469
Money market 16,073,619
Money market held in trust by fiscal agent 26,483,483
Local Agency Investment Fund 89,354,488
Total cash and cash equivalents 138,197,059
Investments:

Investments held by fiscal agent 110,790,207
Deferred compensation 4,354,495
Total inv estments 115,144,702
Total cash and inv estments 253,341,761$

A. Demand Deposits

The carrying amounts of the City’s demand deposits we re $6,260,469 at June 30, 2022. Bank balances were $8,938,429 at that date. The total am ount of which was collateralized or insured with securities held by the pledging financial institutions in the City’s name is discussed below.

The California Government Code requir es California banks and savings and loan associations to secure the City’s cash deposits by pledging securities as co llateral. This Code states that colla teral pledged in this manner shall have the effect of perfecting a security interest in such collateral superior to those of a general creditor. Thus, collateral for cash deposits is consider ed to be held in the City's name.

The market value of pledged securities must equal at least 110% of the City's cash de posits. California law also allows institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the City’s total cash deposits. The C ity may waive collateral requirements for cash deposits; however, the City has not waived the collateralization requirements..

The City follows the practice of pooling cash and investments of all funds, except for funds required to be held by fiscal agents under the provisions of bond indentures. In terest income earned on pooled cash and investments is allocated on an accounting period basis to the various funds based on the period-end cash and investment balances.

Interest income from cash and investments with fiscal agents is credited directly to the related fund.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

71 Note 3 – Cash and Investments (Continued)

B. Investments

The table below identifies the investment types that are authorized for the City by the California Government Code (or the City’s investment policy, where more restrictive). The table also identifies certain provisions of the California Government Code that address interest rate risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustees that are governed by the provisions of debt agreements of the City, rather than the general provision of the California Government Code or the City’s investment policy:

Ma x i m um Ma x i m um
Ma x i m um Percentage Investment in
Authorized Investment Types Maturity of Portfolio One Issuer* Certificates of deposit 5 years None None
Repurchase agreements 5 years None None
Bankers' acceptances 5 years None None
Guaranteed investment contracts 5 years None None
U.S. Treasury bills and notes 5 years None None
State of California Local Agency Investment Fund N/A None None Government agency securities 5 years None None
Passbook savings accounts 5 years None None
Mutual funds 5 years None None
Interest bearing checking accounts N/A None None
Commercial paper 5 years None None
* Based on state law requirements or City investment policy requirements, whichever is more restrictive.

The Deferred Compensation Plan is permitted by City resolu tion to invest in deeds of trust secured by real or personal property.

In accordance with Section 53651 of the California Governme nt Code, the City cannot invest in inverse floaters, range notes, or interest-only strips that are derived from a pool of mortgages, or in any security that could result in zero interest accrual if held to maturity. The limitation does not apply to investments in shares of beneficial interest issued under the Investment Company Act of 1940 that are authorized investments under Section 53601 of the California Government Code. A five-year maximum matu rity for each investment is allowed unless approved by the City Council.

Investment income from cash and invest ments held by fiscal agents are credit ed directly to the related funds.

The City is a participant in LAIF which is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. The City’s investments with LAIF at June 30, 2022, included a portion of the pool funds invested in Structured Notes and Asset-Backed Securities:

Structured Notes: debt securities (other than asset-backed securities) whose cash flow characteristics (coupon rate, redemption amount, or stated ma turity) depend upon one or more indi ces and/or that have embedded forwards or options.

Asset-Backed Securities: generally, mortgage-backed securities that entitle their purchasers to receive a share of the cash flows from a pool of assets such as principal and interest repayments from a pool of mortgages (for example, Collateralized Mortgage Obligations) or credit card receivables.

As of June 30, 2022, the City had $89,354,488 invested in LAIF, which had invested 1.88% of the pool investment funds in Structured Notes and Asset-Backed Securities. The fair value of the City’s portion in the pool is the same as the value of the pool shares and reported at amortized cost.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

72 Note 3 – Cash and Investments (Continued)

C. Risk Disclosures

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.

As a means of limiting exposure to fair value losses from rising interest rates, the City’s investment policy limits the maturity of investments in accordance with Government Code Sections 53601(a)-(n) and 53636(a)-(m). It is the City’s policy to ladder investments so that there are always investments coming due to meet cash flow requirements.

Because the Local Agency Investment Fund as of June 30, 2022 had an average life of 291 days, it was presented as an investment with a maturity of 0-12 months. Howeve r, LAIF allows the City to make withdrawals of any amount within 24 hours.

At June 30, 2022, the City had the following investment maturities:

Investment Type Total 1 year or fewer 1 to 5 years Over 5 years Investment agreements - BNY 104,438,438$ -$ -$ -$ New York Life Pension 6,351,769 - 6,351,769 - Trust deeds - deferred compensation 4,354,495 - 4,354,495 - Total inv estments 115,144,702$ -$ 10,706,264$ -$ Investment Maturities

For deposits, custodial credit risk is the risk that, in the event of the failure of a depository financial institution, the City 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. For an i nvestment, custodial credit risk is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer), the City will no t be able to recover the value of its investments or collateral securities that are in the possession of an outside party.

The City’s investment policy limits safekeeping of investments to third-party custody. All of the City’s deposits are either insured by the Federal Depository Insurance Corpor ation (“FDIC”) up to $250,00 0 or collateralized with pledge securities held in the trust department of the financial institution in the City’s name.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

73 Note 3 – Cash and Investments (Continued)

C. Risk Disclosures (Continued)

Disclosures Relating to Concentration of Credit Risk

The City places no limit on the amount the City may invest in any one issu er. However, the City’s investment policy calls for portfoli o diversification by avoiding over concentrat ion in a specific maturi ty sector or specific investments. The City’s portfolio is detailed below:

Investment Type Value S&P Moody's % of Total
Investment agreements:

Municipal bonds -$ AA NR 0.00% Corporate bonds - NR Aaa 0.00% - AA+ Aaa 0.00%
- AA+ Aaa 0.00%
Certificates of deposit - NR NR 0.00% Trust deeds - deferred compensation 4,354,495 NR NR 3.45% Money market at Rabobank - NR NR 0.00% Money market funds: 0.00%
Fidelity Investment MM Gov 855,860 AAAm Aaa-mf 0.68% Dreyfus Gov Cash Management 373,469 NR NR 0.30% Capital GTY - NR NR 0.00%
Wells Fargo & Co 57 BBB+ A1 0.00% Westdeutsche Landesbank 975,467 NR NR 0.77% Insurance Reserve 390,900 NR NR 0.31%
Wilmington Trust, NA 23,670,530 A- A2 18.74%
New York Life Fixed Dollar Account 6,351,769 NR NR 5.03% Investments Held in PARS Trust - NR NR 0.00% Local Agency Investment Fund 89,354,488 NR NR 70.73% Total investments 126,327,035$ 100.00%

D. Fair Value Measurement

The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuati on inputs used to measure the fair value of the asset.

The hierarchy gives the highest priority to unadjusted quoted prices in active market s for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described as follows:

Level 1 – Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the City has the ability to access.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

74 Note 3 – Cash and Investments (Continued)

D. Fair Value Measurement (Continued)

Level 2 – Inputs to the valuation methodology include:

• Quoted prices for similar assets or liabilities in active markets; • Quoted prices for identical or similar assets or liabilities in inactive markets; • Inputs other than quoted prices that are observable for the asset or liability; and • 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 unobserva ble and significant to the fair value measurement.

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). Unobservable inputs are developed based on the best information available in the circumstances and may include the City’s own data.

The asset’s level within the hierarchy is based on the lowest level of input that is significant to the fair value measurement. Valuation techniques used, need to maximize the use of observable inputs and minimize the use of unobservable inputs. The determination of what constitutes observable requires judgment by the City’s management. City management consider s observable data to be that market data, which is readily available, regularly distributed or updated, reliable, and verifi able, not proprietary, and pr ovided by multiple independent sources that are actively involved in the relevant market. The categorization of an investment within the hierarchy is based upon the relative observab ility of the inputs to its fair value measurement and does not necessarily correspond to City management’s perceived risk of that investment.

In instances where inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety ar e categorized based on the lowest level input that is significant to the valuation. The City’s assessment of the significance of particular inputs to these fair value measurements requires judgment and considers factors specific to each asset or liability.

Deposits and withdrawals in governmental investment pool s, such as LAIF, are made on the basis of $1 and not fair value. Accordingly, the City’s measured fair value of its proportionate share in these types of investments is based on uncategorized inputs not defined as a Level 1, Le vel 2, or Level 3 input. N on-negotiable FDIC-insured bank certificates of deposit are priced at par.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

75 Note 3 – Cash and Investments (Continued)

D. Fair Value Measurement (Continued)

The City had the following recurring fair value measurements as of June 30, 2022:

Inv estments measured by fair v alue lev el: June 30, 2022 Level 1 Level 2 Level 3 Investment agreements:

Municipal bonds -$ -$ -$ -$ Certificates of deposit - - - - Trust deeds - deferred compensation 4,354,495 - - 4,354,495 Total inv estments by fair v alue lev el 4,354,495 -$ -$ 4,354,495$ Investments not subject to the fair value hierarchy:

Money market at Rabobank -
Money market funds:

Fidelity Investment MM Gov 855,860
Dreyfus Gov Cash Management 373,469
Capital GTY -
Wells Fargo & Co 57
Westdeutsche Landesbank 975,467
Insurance Reserve 390,900
Wilmington Trust, NA 23,670,530
New York Life Fixed Dollar Account 6,351,769
Investments Held in PARS Trust -
Local Agency Investment Fund 89,354,488
Total investments not subject to the fair value hierarchy 121,972,540 Total inv estments 126,327,035$

The following is a description of the valuation methods and assumptions used by the City to estimate the fair value of its investments:

• Investments classified within Level 1 of the fair value hierarchy are valued using quoted prices in active markets when available.

• The City held one type of investment that is measured using Level 3 inputs, Trust Deeds. The City administers a Trust Deposit Fund that includes a Deferred Comp ensation Plan funded solely by the voluntary salary reductions. Trust Deed notes secured by property taken back in foreclosure and held for resale, are valued by independent real estate professionals (market approach), and trust deed notes are valued at their present value (income approach). The valuations are considered Level 3. The value of properties held for resale are reduced for cost of sales. The notes (loans) are valued b ased on amounts investors would likely pay for notes with interest rates ranging from 6% to 11% discounted to provide loan to values ranging from 50% to 70% depending on property type and condition, borrowers payment history, and term remaining on note.

There have been no changes in the methods and assumptions used at June 30, 2022. The methods described may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values.

City management believes its valuation methods are appropriate and consistent with other market participants. The use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

76 Note 4 – Restricted Assets

Certain cash and investments are reported as restricted assets at June 30, 2022 as follows:

Governmental Funds:

Assessment District Debt Service Fund - restricted for debt service 124,466$ Assessment District Reserve Debt Service Fund - restricted for debt service 234,528 2019 Special Tax Bond Monte Bella Debt Service Fund - restricted for debt service 327,643 Enterprise Funds:

Sanitary Sewer Fund - restricted for debt service 6,987 Internal S ervice Funds:

Workers Compensation Internal Service Fund 274,506
General Liability Internal Service Fund 116,394
Total restricted assets - primary government 1,084,524$ Fiduciary Funds:

Private Purpose Trust Funds 1,706,907$
Pension Trust Fun d 4,367,611
Custodial Funds 77,059
Total restricted assets - fiduciary funds 6,151,577$

Note 5 – Taxes Receivable

Taxes receivable recorded in the General Fund of $19,437,488 represent amounts due for the quarter ended June 30, 2022 for the following taxes:

Sales tax 6,997,902$
Measure E transaction and use tax 2,928,655
Measure G transaction and use tax 5,892,370
Utility users tax 1,255,792
Transient occupancy tax 1,029,507
Franchise tax 728,720
Cannabis tax 377,652
Other taxes 145,441
Property transfer tax 81,449
19,437,488$

Note 6 – Assessments Receivable

Debt Service Fund – Assessments receivab le recorded in the Assessment District Debt Service Fund of $8,970,000 at June 30, 2022, will be collected from property owners to re tire outstanding bond principal issued for improvements in special assessment districts.

Assessment receivables in the amount of $8,290,000 are not expected to be collected within the subsequent year.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

77 Note 7 – Due From Other Agencies

At June 30, 2022, amounts due from other agencies consisted of the following:

Federal State Other Total
Governmental Activities:

General Fund:

Welcome Center -$ -$ 75,000$ 75,000$ Special Rev enue Funds:

Association of M onterey Bay Area Govts. - 3,484 - 3,484 CA Emergency Solutions & Housing - 394,272 - 394,272 CA Highway Users Tax - 637,441 - 637,441 CA Housing & Community Development - 77,016 - 77,016 CA State Library - - 4,705 4,705 Cable Franchise - - 43,942 43,942 CDBG Improvement Program 356,421 - - 356,421 City of Pacific Grove - - 174,495 174,495 County of Monterey - 49,029 3,305,793 3,354,822 Department of Alcoholic Beverage Control - - 4,520 4,520 Emergency Shelter Grant 2,618,155 - - 2,618,155 Federal Drug Enforcement 2,172 - - 2,172 HOME Investment Program 28,927 - - 28,927 Office of Traffic Safety 56,590 - - 56,590 SB1 Road Maintenance & Rehab - 562,987 - 562,987 SB2 Permanent Local Housing Allocation - 172,423 - 172,423 U.S. Department of Justice 138,716 - - 138,716 U.S. Department of Treasury 405,783 - - 405,783 Capital Projects Funds:

CA Dept. of Transportation - 9,942 - 9,942 CA Office of Emergency Services - 8,850 - 8,850 Developers - - 1,821,196 1,821,196 Federal ATP Grant 390,715 - - 390,715 Federal Aviation Administration 128,978 - - 128,978 Federal HSIP 29,774 - - 29,774 Homeland Security - FEMA 93,794 - - 93,794 M onterey Bay Air Resource District - 36,200 - 36,200 Monterey Bay Unified Air Pollution Control Dist. - 148,479 - 148,479 Monterey County - RSTP - 928,823 - 928,823 State Dept. of Forestry and Fire - 29,161 - 29,161 State Water Grant - 133,801 - 133,801 Transportation Agency for M onterey County - 8,670 - 8,670 Primary government total 4,250,025$ 3,200,578$ 5,429,651$ 12,880,254$

Note 8 – Leases Receivable

The City leases land and easements to third parties. Leases receivable consist of agreements with third parties for the “right-to-use” the underlying assets owned by the City. The remaining terms of the agreements range from one to 28 years. The calculated interest rates used match the City’s incremental borrowing rate at July 1, 2021.

For fiscal year ended June 30, 2022, the City recognized $1,219,733 in lease revenue and $237,791 in interest revenue, and the outstanding receivable amount is $11,629,846.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

78 Note 8 – Leases Receivable (Continued)

A summary of changes in the leases receivable for the fiscal year ended June 30, 2022 is as follows:

Amounts Amounts
Balance due within due in more
July 1, 2021 Additions Reductions June 30, 2022 one year than one year Governmental activities 6,694,836$ -$ (648,777)$ 6,046,059$ 561,725$ 5,484,334$ Business-type activities 6,014,676 - (430,889) 5,583,787 429,471 5,154,316 Total 12,709,512$ -$ (1,079,666)$ 11,629,846$ 991,196$ 10,638,650$

Future lease payments are as follows as of June 30, 2022:

Year Ending Lease
June 30 Receivable Interest Total
2023 991,196$ 396,542$ 1,387,738$ 2024 943,755 363,066 1,306,821 2025 813,685 334,209 1,147,894 2026 711,687 307,723 1,019,410 2027 587,282 284,785 872,067 2028-2032 2,751,304 1,129,241 3,880,545 2033-2037 2,982,455 605,999 3,588,454 2038-2042 1,229,849 204,293 1,434,142 2043-2047 446,813 70,787 517,600 2048-2050 171,820 7,364 179,184 Total 11,629,846$ 3,704,009$ 15,333,855$

As of June 30, 2022, the amounts re ported as deferred inflows of resources will be recognized as lease revenue as follows:

Year Ending
June 30 Total
2023 1,267,881 $
2024 1,162,821
2025 990,183
2026 842,795
2027 728,387
2028-2032 2,892,397
2033-2037 2,316,768
2038-2042 851,310
2043-2047 324,909
2048-2050 112,328
Total 11,489,779$

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

79 Note 9 – Loans and Notes Receivable

At June 30, 2022, loans and notes receivable of the City's major individual funds and non-major funds taken in aggregate, including the applicable allowance for uncollectible accounts are as follows:

Low
& Moderate Total
Income Governmental Fiduciary
CDBG Housing Asset Activ ities Funds
Loans funded by federal grants: 22,453,556$ -$ 22,453,556$ -$ Economic development real estate
developer and other loans - 10,022,690 10,022,690 173,900 Less: allowance for uncollectibles (22,386,988) (10,006,119) (32,393,107) - Total loans, net 66,568$ 16,571$ 83,139$ 173,900$

The City uses funds generated from the former Agency Housing Loans as well as other state and federal funding sources to offer financial assistance to qualif ied developers, individuals and families by providing loans at “below market” interest rates.

Typical loans and related terms are summarized as follows:

Loan Type Interest Rates Due
Affordable housing 0 - 4% up to 55 years
Multi-unit rental rehabilitation 3% 5 or more years
First time home buyer 3% 7 to 40 years
Home improvement 3 - 6% 1 to 30 years

Loans are secured by first or second in lien-property deeds of trust except for first time homebuyer loans, which are all secured by second deeds of trust. Interest and principal are typically due in installments, except for first time homebuyer, which do not require payments until their maturity dates.

The City has also invested in multi-family rental housing projects serving low to moderate income individuals through subordinate loans with terms of up to 55 years. Generally, th ese loans are to be repaid th rough fixed payments or net cash flow payments from project operations and the term and potential risk of each loan varies. Because of the net cash flow feature of these subordinate loans, there is greater risk of variability in the timing of payments and, potentially, a lower probability of eventual repayment on these subordinate loans than on other loan types.

Accordingly, for financial statement purposes, the City has established an allowance account for these loans receivable due to the contingent nature of the repayment schedules of these loans.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

80 Note 10 – Interfund Receivables, Payable, and Transfers

A. Due From and To Other Funds

At June 30, 2022, the balances of due from and to other funds were as follows:

Receivable Fund Payable Fund Amount Purpose
General Fund Grants Special Revenue Fund 717,402$ Cash overdraft General Fund Housing and Urban Development Special Revenue Fund 4,012,495 Cash overdraft General Fund Downtown Parking District Enterprise Fund 1,705,208 Cash overdraft General Fund Emergency Medical Services Special Revenue Fund 300,365 Cash overdraft General Fund Development Fees Special Revenue Fund 268 Cash overdraft General Fund Lighting, Landscape, and Maintenance Dist Special Revenue Fund 51,188 Cash overdraft General Fund Special Construction Assistance Capital Projects Fund 1,235,128 Cash overdraft General Fund Traffic Safety Special Revenue Fund 81,891 Cash overdraft General Fund Assessment District Administration Debt Service Fund 2,178 Cash overdraft 8,106,123
Capital Projects Capital Projects Fund General Fund 339,665 Capital projects Capital Projects Capital Projects Fund Industrial Waste Enterprise Fund 26,220 Capital projects Capital Projects Capital Projects Fund Emergency M edical Services Special Revenue Fund 15,792 Capital projects Capital Projects Capital Projects Fund Gas Tax Special Revenue Fund 81,232 Capital projects Capital Projects Capital Projects Fund Development Fees Special Revenue Fund 413,561 Capital projects Capital Projects Capital Projects Fund Measure X Special Revenue Fund 272,811 Capital projects Capital Projects Capital Projects Fund Permit Services Enterprise Fund 12,072 Capital projects Capital Projects Capital Projects Fund Sanitary Sewer Enterprise Fund 12,123 Capital projects Capital Projects Capital Projects Fund SB1 Road Maintenance & Rehab Special Revenue Fund 191,057 Capital projects 1,364,533
Workers Compensation Internal Service Fund General Fund 16,831,462 Claims Total 26,302,118$

B. Long-Term Advances

At June 30, 2022, the balances of long-term advances were as follows:

Adv ances Due To
Governmental
Activities
General Fund
Adv ances Due From
Business-Type Activities:

Downtown Parking 2,785,000 $
Total business-type activities 2,785,000
Total primary government 2,785,000$

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

81 Note 10 – Interfund Receivables, Payable, and Transfers (Continued)

C. Transfers

Interfund transfers during the year ended June 30, 2022, consisted of the following:

Transfers In Transfers Out Amount Purpose
General Fund Gas Tax Special Revenue Fund 1,725,000$ Capital projects/debt service General Fund Traffic Safety Special Revenue Fund 250,000 Capital projects/debt service General Fund Grants Special Revenue Fund 4,099 Capital projects/debt service Subtotal General Fund 1,979,099
Housing and Urban Development Special Revenue Fund General Fund 4,424 Grant projects Airport Enterprise Fund Capital Projects Capital Projects Fund 20,467 Contribute capital assets Industrial Waste Enterprise Fund General Fund 1,865,000 Operating subsidy Sanitary Sewer Enterprise Fund Capital Projects Capital Projects Fund 45,436 Capital projects Emergency Medical Services Special Revenue Fund General Fund 850,000 Operating subsidy Vehicle Abatement Special Revenue Fund General Fund 50,000 Operating subsidy Grants Special Revenue Fund General Fund 2 Operating subsidy 2018 Lease-PS Building Police Debt Service Fund General Fund 11,938,298 Debt Service COP 2018B T.R.I.P. Debt Service Fund Measure X Special Revenue Fund 2,340,074 Debt Service 2018 Lease El Gabilan Library Debt Service Fund General Fund 788,457 Debt Service 2020A Refunding Energy Debt Service Fund General Fund 1,177,177 Debt Service 2020A Refunding Energy Debt Service Fund Energy Improvement Lease Debt Service Fund 36,001 Debt Service 2020A Refunding Energy Debt Service Fund Airport Enterprise Fund 76,545 Debt Service 2020A Refunding Energy Debt Service Fund Industrial Waste Enterprise Fund 71,658 Debt Service 2020A Refunding Energy Debt Service Fund Sanitary Sewer Enterprise Fund 95,495 Debt Service 2020A Refunding Energy Debt Service Fund Downtown Parking District Enterprise Fund 32,391 Debt Service Subtotal 2020A Refunding Energy Debt Service Fund 1,489,267 2020A Refunding SVSWA Debt Service Fund General Fund 602,794 Debt Service 2020A Refunding SVSWA Debt Service Fund 2015 Refunding COP 2005 A&B Debt Service Fund 87,010 Debt Service Subtotal 2020A Refunding SVSWA Debt Service Fund 689,804 Capital Projects Capital Projects Fund General Fund 4,918,635 Capital Projects Capital Projects Capital Projects Fund Monte Bella Maint District Special Revenue Fund 4,110 Capital Projects Capital Projects Capital Projects Fund Development Fees Special Revenue Fund 1,603,186 Capital Projects Capital Projects Capital Projects Fund Gas Tax Special Revenue Fund 552,775 Capital Projects Capital Projects Capital Projects Fund Emergency Medical Services Special Revenue Fund 120,792 Capital Projects Capital Projects Capital Projects Fund Measure X Special Revenue Fund 1,308,013 Capital Projects Capital Projects Capital Projects Fund SB1 Road Maintenance & Rehab Special Revenue Fund 1,556,858 Capital Projects Capital Projects Capital Projects Fund Affordable Housing Special Revenue Fund 6,800 Capital Projects Capital Projects Capital Projects Fund Special Construction Assistance Capital Projects Fund - Capital Projects Capital Projects Capital Projects Fund Industrial Waste Enterprise Fund 1,758,837 Capital Projects Capital Projects Capital Projects Fund Sanitary Sewer Enterprise Fund 3,971,041 Capital Projects Capital Projects Capital Projects Fund Permit Services Enterprise Fund 358,418 Capital Projects Subtotal Capital Project Capital Projects Fund 15,884,062 General Liabiilty Internal Service Fund General Fund 1,661,300 Operating Subsidy Fleet Internal Service Fund General Fund 11,120,000 Operating Subsidy Total 50,725,690$

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

82 Note 11 – Capital Assets

A. Governmental Activities

The summary of changes in governmental activities capital assets for the year ended June 30, 2022, is as follows:

Balance
July 1, 2021, Prior Period Balance
Gove rnme ntal Acti vi ti e s: as Restated Adjustment Additions Retirements Transfers June 30, 2022 Nondepreciable assets:

Land 25,899,986$ -$ -$ -$ -$ 25,899,986$ Construction in progress 159,896,482 1,667,376 6,712,551 - (143,852,318) 24,424,091 Total nondepreciable assets 185,796,468 1,667,376 6,712,551 - (143,852,318) 50,324,077 Depreciable assets
Buildings and improvements 46,337,340 1,634,233 - - 87,157,535 135,129,108 Improvements other than buildings 15,766,022 11,749,332 - - 23,161,998 50,677,352 Machinery and equipment 42,133,934 1,844,782 312,789 (1,052,050) 2,711,962 45,951,417 Infrastructure 255,168,975 135,160,357 - - 30,820,823 421,150,155 Right-to-use assets 126,634 - 412,877 - - 539,511 Total depreciable/amortizable assets 359,532,905 150,388,704 725,666 (1,052,050) 143,852,318 653,447,543 Accumulated depreciation/amortization
Buildings and improvements (22,484,365) (772,320) (889,092) - - (24,145,777) Improvements other than buildings (11,388,190) (11,311,523) (588,458) - - (23,288,171) M achinery and equipment (31,453,429) (1,644,102) (3,298,504) 1,017,170 - (35,378,865) Infrastructure (174,327,696) (103,493,631) (7,969,057) - - (285,790,384) Rig ht-to-use assets - - (204,913) - - (204,913) Total accumulated depreciation/amortization (239,653,680) (117,221,576) (12,950,024) 1,017,170 - (368,808,110) Total depreciable/amortizable assets, net 119,879,225 33,167,128 (12,224,358) (34,880) 143,852,318 284,639,433 Governmental activities
capital assets, net 305,675,693$ 34,834,504$ (5,511,807)$ (34,880)$ -$ 334,963,510$

Prior period adjustments in the amount of $34,834,504 were made to move capital assets from business-type activities. The beginning balance was also restated in the amount of $126,634 for GASB 87 Leases implementation.

Depreciation and amortization expense was charged to the functions/programs of the governmental activities as follows:

Gove rnme ntal Acti vi ti e s:

General government 583,471$
Police 1,333,392
Fire 1,087,348
Public works, including infrastructure 8,905,398
Recreation and parks 856,166
Library 184,249
Total depreciation/amortization expense - governmental activities 12,950,024$

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

83 Note 11 – Capital Assets (Continued)

B. Business-Type Activities

The summary of changes in business-type activities capital assets for the year ended June 30, 2022, is as follows:

Balance Prior Period Balance
Business-Type Activities: July 1, 2021 Adjustment Additions Retirements Transfers June 30, 2022 Nondepreciable assets:

Land 3,632,339$ -$ -$ -$ -$ 3,632,339$ Construction in progress 5,259,442 (1,667,376) 1,928,508 (1,796,095) (776,913) 2,947,566 Total nondepreciable assets 8,891,781 (1,667,376) 1,928,508 (1,796,095) (776,913) 6,579,905 Depreciable assets
Buildings and improvements 27,523,054 (1,634,233) - - - 25,888,821 Improvements other than buildings 26,708,254 (11,749,332) - - 502,183 15,461,105 M achinery and equipment 9,332,629 (1,844,782) 198,367 - 93,295 7,779,509 Infrastructure 237,688,120 (135,160,357) - - 181,435 102,709,198 Rig ht-to-use assets - - - - - - Total depreciable assets 301,252,057 (150,388,704) 198,367 - 776,913 151,838,633 Accumulated depreciation/amortization:

Buildings and improvements (15,943,528) 772,320 (730,298) - - (15,901,506) Improvements other than buildings (16,495,799) 11,311,523 (719,769) - - (5,904,045) Machinery and equipment (6,575,105) 1,644,102 (331,308) - - (5,262,311) Infrastructure (160,744,037) 103,493,631 (1,854,796) - - (59,105,202) Rig ht-to-use assets - - - - - - Total accumulated depreciation/amortization ( 199,758,469) 117,221,576 (3,636,171) - - (86,173,064) Total depreciable assets, net 101,493,588 (33,167,128) (3,437,804) - 776,913 65,665,569 Business-type activities
capital assets, net 110,385,369$ (34,834,504)$ (1,509,296)$ (1,796,095)$ -$ 72,245,474$

Prior period adjustments in the amount of $(34,834,504) were made to move capital assets governmental activities.

Depreciation expense was charged to the functions/programs of the business-type activities as follows:

Business-type Activities:

Airport 957,136$
Industrial Waste 512,071
Sanitary Sewer 1,568,293
Downtown Parking 558,382
Permit Services 40,289
Total depreciation expense - business-type activities 3,636,171$

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

84 Note 11 – Capital Assets (Continued)

C. Successor Agency

The summary of changes in capital assets for the Successor Agency for the year ended June 30, 2022, is as follows:

Balance Prior Period Balance
Fiduciary Activities: July 1, 2021 Adjustment Additions Retirements Transfers June 30, 2022 Nondepreciable assets:

Land 149,270$ (149,270)$ -$ -$ -$ -$ Total nondepreciable assets 149,270 (149,270) - - - - Fiduciary activities
capital assets, net 149,270$ (149,270)$ -$ -$ -$ -$

A prior period adjustment was made to remove land that was no longer owned by the Successor Agency.

Note 12 – Land and Properties Held For Resale

Land and properties held for resale at June 30, 2022 consisted of the following:

Special Revenue Fund
137, 145, & 151 Division Street 584,419$
Affordable Housing Fund - Sunset Avenue Merged Housing
115 Division Street 230,981
123 Division Street 206,265
923 E. Market Street 358,335
795,581
Total land and properties held for resale 1,380,000$

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

85 Note 13 – Long-Term Debt

A. Governmental Activities

A summary of changes in long-term debt for governmental activities for the year ended June 30, 2022 is as follows:

Balance Period Balance within one more than one
July 1, 2021 Adjustments Additions Retirements June 30, 2022 year year Governmental Activities
Direct Borrowings - leases 65,977,431$ 239,801$ 1,743,790$ (11,902,720)$ 56,058,302$ 4,643,883$ 51,414,419$ Certificates of Participation:

TRIP 2018B 36,110,000 - - (740,000) 35,370,000 750,000 34,620,000 Series 2020A-Twin Creeks - 2,330,000 - (355,000) 1,975,000 365,000 1,610,000 Series 2020B Fairways - 3,930,000 - (100,000) 3,830,000 110,000 3,720,000 Series 2020A-Energy (2014) 15,650,000 - - (865,000) 14,785,000 935,000 13,850,000 Series 2020A-SVSWA (2015B) 3,860,000 - - (525,000) 3,335,000 545,000 2,790,000 Bond premium/(discount):

TRIP 2018B 3,556,183 - - (354,682) 3,201,501 - 3,201,501 TRIP 2018B (344,239) - - 13,240 (330,999) - (330,999) Series 2020A-Twin Creeks - 272,085 - (45,348) 226,737 - 226,737 Series 2020A-Energy (2014) 2,981,656 - - (248,472) 2,733,184 - 2,733,184 Series 2020A-SVSWA (2015B) 491,089 - - (70,156) 420,933 - 420,933 Total Certificates of Participation: 62,304,689 6,532,085 - (3,290,418) 65,546,356 2,705,000 62,841,356 Assessment District Bonds:

Ass
essment District 2017 Act Bonds 1,560,000 - - (590,000) 970,000 430,000 540,000 CFD Monte Bella-2019 #1 2,625,000 - - (50,000) 2,575,000 55,000 2,520,000 CFD Monte Bella-2019 #2 2,090,000 - - (40,000) 2,050,000 40,000 2,010,000 CFD Monte Bella-2019 #3 2,695,000 - - - 2,695,000 50,000 2,645,000 Bond premium/(discount):

CFD Monte Bella-2019 #1 72,436 - - (2,498) 69,938 - 69,938 CFD Monte Bella-2019 #2 203,920 - - (7,032) 196,888 - 196,888 CFD Monte Bella-2019 #3 242,947 - - - 242,947 - 242,947 Total Assessment District Bonds 9,489,303 - - (689,530) 8,799,773 575,000 8,224,773 Total governmental activities 137,771,423$ 6,771,886$ 1,743,790$ (15,882,668)$ 130,404,431$ 7,923,883$ 122,480,548$

Direct Borrowing – Leases

Annual debt service requirements to maturity for the City’s leases are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 4,643,883$ 2,315,583$ 6,959,466$
2024 4,732,630 2,110,407 6,843,037
2025 4,642,843 1,899,896 6,542,739
2026 4,633,821 1,688,306 6,322,127
2027 4,280,125 1,473,155 5,753,280
2028-2032 21,328,000 4,331,337 25,659,337 2033-2037 3,617,000 1,852,843 5,469,843 2038-2042 2,960,000 1,324,872 4,284,872 2043-2047 3,585,000 687,562 4,272,562 2048-2051 1,635,000 65,213 1,700,213 Total 56,058,302$ 17,749,174$ 73,807,476$
DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

86 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Direct Borrowing – Leases (Continued)

Quantum Tiller Ladder Truck

On January 21, 2014, the City, using lease purchase financing, purchased a Quantum Tiller Ladder Truck for a total of $1,087,053. The City will make ten annual payments of $124,848, beginning on March 17, 2015 and ending March 17, 2024 at 2.60% interest. Debt payable of $240,285 is recorded as Governmental Activities at June 30, 2022.

Debt service requirements to maturity for the Quantum Tiller Ladder Truck are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 118,601$ 6,247$ 124,848$
2024 121,684 3,164 124,848
Total 240,285$ 9,411$ 249,696$

Pierce Pumper & Tiller

On March 6, 2015, the City, using lease purchase financing, purchased a Pierce Pumper and Tiller for a total of $1,628,839. The City will make ten annual payments beginning on March 6, 2016 and ending March 6, 2025 at

2.51% interest. Debt payable of $357,364 is recorded as Governmental Activities at June 30, 2022.

If any event of default occurs, and if the lessee agrees to pay, the lessor may require the lessee to pay all amounts currently due and all remaining rent payments due during th e fiscal year in effect when the default occurs with interest at the highest lawful rate from the date of th e lessor’s demand for such payment. Also included in this scenario are additional out-of-pocket expenses incurred by the lessor including a ttorney fees, repossession, safekeeping, storage, repair, reconditioning, and disposition costs. Alternatively, the lessor can require the lessee to return all equipment for the purpose of lease, sale, or otherwise disposition by the lessor.

Debt service requirements to maturity for the Pierce Pumper & Tiller are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 116,185$ 8,958$ 125,143$
2024 119,097 6,046 125,143
2025 122,082 3,060 125,142
Total 357,364$ 18,064$ 375,428$

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

87 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Direct Borrowing – Leases (Continued)

2014 Lease/Purchase Agreement

The City of Salinas 2014 Lease/Purchase Agreement was issued by the Sali nas Facilities Financing Authority on January 29, 2014. The financing was issued to refund the Animal Shelter COP Series A-1999 ($2,812,000) and the Monterey Street Parking Structure COP Series A-2004 ($13,253,000). The Animal Shelter portion of the financing was issued for 19 years (ending September 1, 2032), at an average interest rate of 4.02%. Maximum annual debt service is $278,646. Debt payable of $1,644,000 is recorded as Governmental Activities at June 30, 2022.

Upon the occurrence of an event of default, the trustee may pursue any available remedy by law or pursuant to the lease agreement to enforce payment of the outstanding amounts. However, there shall be no right under any circumstance to accelerate the lease payments or otherwi se declare any lease payments not then in default to be immediately due and payable. After the occurrence of an event of default, the City will surrender possession of the property to the financing authority, if requested to do so.

Debt service requirements to maturity for 2014 Lease/Purchase Agreement are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 163,000$ 62,813$ 225,813$
2024 171,000 56,099 227,099
2025 179,000 49,064 228,064
2026 191,000 41,627 232,627
2027 120,000 35,376 155,376
2028-2032 668,000 99,816 767,816 2033 152,000 3,055 155,055
Total 1,644,000$ 347,850$ 1,991,850$

Pierce Enforcer Pumper

On October 18, 2017, the City, using lease purchase financing, purchased a Pierce Enforcer Pumper fire engine for a total of $561,605. The City will make six annua l payments of $101,822, begi nning on October 18, 2018 and ending October 18, 2023 at 2.40% interest. Debt payabl e of $169,370 is recorded as Governmental Activities on June 30, 2022.

If any event of default occurs, and if the lessee agrees to pay, the lessor may require the lessee to pay all amounts currently due and all remaining rent payments due during th e fiscal year in effect when the default occurs with interest at the highest lawful rate from the date of th e lessor’s demand for such payment. Also included in this scenario are additional out-of-pocket expenses incurred by the lessor including a ttorney fees, repossession, safekeeping, storage, repair, reconditioning, and disposition costs. Alternatively, the lessor can require the lessee to return all equipment for the purpose of lease, sale, or otherwise disposition by the lessor.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

88 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Direct Borrowing – Leases (Continued)

Pierce Enforcer Pumper (Continued)

Debt service requirements to maturity for Pierce Enforcer Pumper are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 96,992$ 4,830$ 101,822$
2024 99,378 2,444 101,822
Total 196,370$ 7,274$ 203,644$

Altec Aerial Lift

On December 19, 2017, the City, using lease purchase financing, purchased an Altec Aerial Lift Truck for a total of $157,983. The City will make six annual payments of $28,903, beginning on December 19, 2018 and ending December 19, 2023. Debt payable of $55,522 is recorded as Governmental Activities on June 30, 2022.

If any event of default occurs, and if the lessee agrees to pay, the lessor may require the lessee to pay all amounts currently due and all remaining rent payments due during th e fiscal year in effect when the default occurs with interest at the highest lawful rate from the date of th e lessor’s demand for such payment. Also included in this scenario are additional out-of-pocket expenses incurred by the lessor including a ttorney fees, repossession, safekeeping, storage, repair, reconditioning, and disposition costs. Alternatively, the lessor can require the lessee to return all equipment for
the purpose of lease, sale, or otherwise disposition by the lessor.

Debt service requirements to maturity for Altec Aerial Lift are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 27,387 $ 1,516$ 28,903$
2024 28,135 768 28,903
Total 55,522$ 2,284$ 57,806$

Public Safety Building 2018A

The City of Salinas 2018A Capital Lease was issued by Salinas Public Facilities, Inc. in the amount of $48,825,000 on June 28, 2018. The purpose of this financing was to ra ise funds for the construction of a new Public Safety Building (Police Department) within City limits. The City started making semi-a nnual payments beginning on December 1, 2018 and ending December 1, 2034 at an aver age interest rate of 3.375%. Maximum annual debt service is $4,799,181. Debt payable of $35,775,000 is recorded as Governmental Activities on June 30, 2022.

In the event of an event of default, the trustee shall be entitled to declar e the principal of all the bonds then outstanding, and the interest accrued thereon, to be due and payable immediately. Upon such declaration, anything in the indenture or in the bonds contained to the contrary notwithstanding, shall also be due and payable immediately, and interest on the bonds shall cease to accrue on the date of such declaration.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

89 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Direct Borrowing – Leases (Continued)

Public Safety Building 2018A (Continued)

Debt service requirements to maturity for Public Safety Building 2018A are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 2,910,000$ 1,564,194$ 4,474,194$
2024 3,060,000 1,414,944 4,474,944
2025 3,210,000 1,258,194 4,468,194
2026 3,370,000 1,093,694 4,463,694
2027 3,540,000 920,944 4,460,944
2028-2032 18,675,000 1,935,259 20,610,259 2033-2036 1,010,000 16,413 1,026,413 Total 35,775,000$ 8,203,642$ 43,978,642$

El Gabilan Library 2018B

The City of Salinas 2018B Capital Lease was issued by Salinas Public Facilities, Inc. in the amount of $19,830,000 on June 28, 2018. The purpose of this financing was to raise funds for the construction of a new Public Library (El Gabilan) within City limits. The City started making semi-annual payments beginni ng on December 1, 2018 and ending December 1, 2048 at an average interest rate of 3.900%. Maximum annual debt service is $1,152,781. Debt payable of $13,915,000 is recorded as Governmental Activities on June 30, 2022.

In the event of an event of default, the trustee shall be entitled to declar e the principal of all the bonds then outstanding, and the interest accrued thereon, to be due and payable immediately. Upon such declaration, anything in the indenture or in the bonds contained to the contrary notwithstanding, shall also be due and payable immediately, and interest on the bonds shall cease to accrue on the date of such declaration.

Debt service requirements to maturity for El Gabilan Library 2018B are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 220,000$ 562,369$ 782,369$
2024 235,000 550,994 785,994
2025 240,000 539,119 779,119
2026 255,000 526,744 781,744
2027 345,000 512,213 857,213
2028-2032 1,985,000 2,296,262 4,281,262 2033-2037 2,455,000 1,833,375 4,288,375 2038-2042 2,960,000 1,324,872 4,284,872 2043-2047 3,585,000 687,562 4,272,562 2048-2051 1,635,000 65,213 1,700,213 Total 13,915,000$ 8,898,723$ 22,813,723$

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

90 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Direct Borrowing – Leases (Continued)

Police/Fire Radios & PW Equipment

The City of Salinas Motorola Radios and Public Work Eq uipment was issued by Banc of America Public Capital Corporation in the amount of $3,500,000 on August 17, 2018. This equipment replaces old manufactured models and will make Police, Fire, and Public Work operations more efficient. The lease consists of 84 payments, beginning on August 17, 2019 and ending on August 17, 2025 at an average interest rate of 3.120%. Debt payable of $2,091,610 is recorded as Governmental Activities on June 30, 2022.

Upon the occurrence of an event of default, legal title and physical position of the equipment shall pass to the Lessor, and the City shall have no further interest therein.

Debt service requirements to maturity for Police/Fire Radios & PW Equipment are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 499,057$ 65,258$ 564,315$
2024 514,627 49,688 564,315
2025 530,684 33,631 564,315
2026 547,242 17,073 564,315
Total 2,091,610$ 165,650$ 2,257,260$

2021 Pierce Enforcer Pumpers

In fiscal year 2022, the City, using lease purchase financing, purchased a Pierce Enforcer Pumper fire engine for a total of $1,330,913. The City w ill make six annual payments of $279, 747, beginning on December 17, 2021 and ending December 17, 2026 at 1.68% interest. Debt payable of $1,330,913 is recorded as Governmental Activities on June 30, 2022.

If any event of default occurs, and if the lessee agrees to pay, the lessor may require the lessee to pay all amounts currently due and all remaining rent payments due during th e fiscal year in effect when the default occurs with interest at the highest lawful rate from the date of th e lessor’s demand for such payment. Also included in this scenario are additional out-of-pocket expenses incurred by the lessor including a ttorney fees, repossession, safekeeping, storage, repair, reconditioning, and disposition costs. Alternatively, the lessor can require the lessee to return all equipment for the purpose of lease, sale, or otherwise disposition by the lessor.

Debt service requirements to maturity for the 2021 Pierce Enforcer Pumper are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 257,388$ 22,359$ 279,747$
2024 261,712 18,035 279,747
2025 266,109 13,638 279,747
2026 270,579 9,168 279,747
2027 275,125 4,622 279,747
Total 1,330,913$ 67,822$ 1,398,735$
DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

91 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Direct Borrowing – Leases (Continued)

Street Sweepers

On April 6, 2017 the City, using lease purchase financing, purchased a second street sweeper. The City will make six annual payments of $58,774 at 2.57 % interest. Debt payable of $57,301 is recorded governmental activities at June 30, 2022.

Upon the occurrence of an event of default, the trustee may pursue any available remedy by law or pursuant to the lease agreement to enforce payment of the outstanding amounts. However, there shall be no right under any circumstance to accelerate the lease payments or otherwi se declare any lease payments not then in default to be immediately due and payable. The financing authority may also elect to terminate the lease, with the City liable for all costs, losses, or damages incurred by the financing authority.

Debt service requirements to maturity for the Street Sweepers are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 57,301$ 1,473$ 58,774$
Total 57,301$ 1,473$ 58,774$

Minor Leases

The City has entered into various minor leases for equipment such as copiers, etc. that were subject to GASB 87 Leases implementation in fiscal year 2022.

Debt service requirements to maturity for these leases are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 177,972$ 15,566$ 193,538$
2024 121,997 8,225 130,222
2025 94,968 3,190 98,158
Total 394,937$ 26,981$ 421,918$

Certificates of Participation Bonds

Series 2018B – TRIP

On July 18, 2108, the California Statewide Communities Development Authority Transportation Revenue issued City of Salinas Certificates of Participation, Series 2018B totaling $37,500,000 at various interest rates plus premium and discounts. The purpose of this financing was to provide expedited funding for the design, acquisition, and construction of local roadway and street improvement projects within the jurisdiction of the City. Debt payable of $35,370,000 plus premiums and discounts of $2,870,502 are record ed as Governmental Activities at June 30, 2022.

In the event of an event of default, the trustee shall be entitled to exercise the remedies provided under the agreement to collect the outstanding payments in full, with no grace period permitted.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

92 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Certificates of Participation Bonds (Continued)

The annual debt service requirements to maturity for the certificates are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 750,000$ 1,561,575$ 2,311,575$
2024 800,000 1,522,825 2,322,825
2025 850,000 1,481,575 2,331,575
2026 890,000 1,442,525 2,332,525
2027 925,000 1,406,225 2,331,225
2028-2032 5,285,000 6,320,150 11,605,150 2033-2037 6,710,000 4,866,625 11,576,625 2038-2042 8,565,000 2,966,750 11,531,750 2043-2047 10,595,000 952,788 11,547,788 Total 35,370,000$ 22,521,038$ 57,891,038$

Series 2020A Twin Creeks

On March 16, 1999, the Salinas Public Financing Authority issued City of Salinas Certificates of Participation (Certificates) Series A-1999 totaling $14,315,000. A portion of the Certificates was allocated for the construction of an animal shelter, $1,250,338, and the balance of the Certificates, $13,064,662 was allocated for construction of the new Twin Creeks (9-hole) Golf Course. On August 24, 2004, the City entered into a sublease agreement with the Monterey Peninsula Foundation and its related foundation, Future Citizen s Foundation, dba the First Tee of Monterey County providing for the lease of Twin Creeks golf course to Future Citizens Foundation. As a condition of the lease, the City repaid the portion of the 1999 Certificates attributable to the Twin Creeks golf course facility (about 57.5% of the lease payments of $575,000) and refinanced that golf course portion with a new Refunding issue of Certificate of Participation. On September 14, 2005, the Salinas Public Financing Authority issued City of Salinas Refunding Certificates of Participation Series 2005A, in the amount of $8,005,000, to refund the portion of the 1999 Certificates attributed to Twin Creeks. Refunding Certificates Series 2005A we re issued for 24 years at

4.22%, and were secured by a lien on Twin Creeks golf course. The net value expense of the funding was $117,298.

The refunding was completed to issue qualified 501 (c) 3 bonds to provide for the operation of Twin Creeks golf course by First Tee of Monterey County. Annual debt ser vice for the 2005A Certificates ($572,308) was paid by the annual lease payments ($575,000) from Future Citizens Foundation and guaranteed by the Monterey Peninsula Foundation. At the request of First Tee of Monterey Count y, on December 6, 2011, the City approved a sublease payment reduction from $575,000 to $125,000 (an annual re duction of $450,000). This request was the result of First Tee’s significant golf course operating losses. With the goal of maintaining a quality of level of service to the thousands of golf youth participants and as the most cost effective alternative, the City Council approved the General Fund support through fiscal year 2015-16 to offset the reduced amount of the sublease to the First Tee of Monterey County.

On September 1, 2015, the City issued Refunding Cer tificates of Participation Series 2015, in the amount of $11,440,000 at a 2.53% interest rate, to refund the outstanding portion of the 2005A Certificates of Participation (Twin Creeks) and the 2005B Certificates of Participation (Capital Improvements). Bond started September 1, 2015 and will end after 12 years on September 1, 2027.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

93 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Certificates of Participation Bonds (Continued)

Series 2020A Twin Creeks (Continued)

On August 19, 2020, the Salinas Public Financing Authority issued City of Salinas Certif icates of Participation, Series 2020A totaling $2,715,000. The Advance Refunding Certificates were issued to refund the 2015A Twin Creeks Golf Project. Bond started November 1, 2020 and will end after 6 years on November 1, 2026. The advance refunding of the 2015A Twin Creeks Golf Project reduced total debt service payments over the next 6 years by $134,501. This results is an economic gain (difference between the present values of the debt service payments on the old and new debt) of $222,408. Debt payable of $1,9 75,000 is recorded in the governmental activities at June 30, 2022.

In the event of an event of default, the Trustee may and, at the direction of the owners of not less than a majority of the aggregate principal amount of bonds then outstanding, and upon being indemnified to its reasonable satisfaction therefore, shall, upon notice in writing to the City and the Salinas Financing Authority, exercise any of the remedies granted to the Salinas Financing Authority under the lease agreement and, in addition, take whatever action at law or in equity may appear necessary or desirable to enforce its rights as assignee pursuant to the Assignment Agreement or to protect and enforce any of the rights vested in the Trustee or the owners, either at law or in equity bankruptcy or otherwise, whether for specific enforcement of any covenant or agreement or for the enforcement of any other legal or equitable right.

The annual debt service requirements to maturity for the certificates are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 365,000$ 71,700$ 436,700$
2024 380,000 56,800 436,800
2025 395,000 41,300 436,300
2026 410,000 25,200 435,200
2027 425,000 8,500 433,500
Total 1,975,000$ 203,500$ 2,178,500$

Series 2020B Fairways

On August 2008, the City of Salinas was issued Refunding Certificates of Participation Series 2008, in the amount of $4,660,000 at a variable interest rate, to refund the outstanding portion of the 1999 Certificate pertaining to the Fairways Golf Project. Bond started September 1, 2008 and will end after 30 years on September 1, 2038. Following the execution and delivery of the Certificates of Participa tion Series 2008, the 1999 Certificates, attributed to the animal shelter, will remain outstanding.

On August 19, 2020, the Salinas Public Financing Authority issued City of Salinas Certif icates of Participation, Series 2020B totaling $4,040,000. The Advance Refunding Ce rtificates were issued to refund the 2008 COP Fairways Golf Project. Bond started November 1, 2020 and will end after 18 years on November 1, 2038. The advance refunding of the 2008 COP Fairways Golf Project reduced total debt service payments over the next 18 years by $1,311,557. This results is an economic loss (difference between th e present values of the debt service payments on the old and new debt) of $222,581. Debt paya ble of $3,830,000 is recorded in the governmental activities at June 30, 2022.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

94 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Certificates of Participation Bonds (Continued)

Series 2020B Fairways (Continued)

In the event of an event of default, the Trustee may and, at the direction of the owners of not less than a majority of the aggregate principal amount of bonds then outstanding, and upon being indemnified to its reasonable satisfaction therefore, shall, upon notice in writing to the City and the Salinas Financing Authority, exercise any of the remedies granted to the Salinas Financing Authority under the lease agreement and, in addition, take whatever action at law or in equity may appear necessary or desirable to enforce its rights as assignee pursuant to the Assignment Agreement or to protect and enforce any of the rights vested in the Trustee or the owners, either at law or in equity bankruptcy or otherwise, whether for specific enforcement of any covenant or agreement or for the enforcement of any other legal or equitable right.

The annual debt service requirements to maturity for the certificates are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 110,000$ 95,118$ 205,118$
2024 120,000 93,997 213,997
2025 135,000 92,537 227,537
2026 155,000 90,619 245,619
2027 165,000 88,184 253,184
2028-2032 1,075,000 380,989 1,455,989 2033-2037 1,400,000 210,000 1,610,000 2038-2041 670,000 20,400 690,400 Total 3,830,000$ 1,071,844$ 4,901,844$

Series 2020A Energy (2014)

On November 1, 2014, the City entered into a lease agreement funded through private placement in the amount of $21,908,000. The project will install LED lighting on streetlights and parking lots in addition to building solar PV installations at the Hitchcock Road Animal Shelter, the Industrial Waste Treatment Plant, the Salinas Municipal Airport, the Permit Center, Sherwood Hall, and the Sewer Lift Station site off Work Street. The Debt Service repayment were set to be over a 17-year period at 3.03% interest beginning May 1, 2016 and ending November 1, 2032. Maximum annual debt service was $2,005,124.

On August 19, 2020, the Salinas Public Financing Authority issued City of Salinas Certif icates of Participation, Series 2020A totaling $16,190,000. The Advance Refunding Certificates were issued to refund the 2014 Energy Improvement Lease. Bond started Novemb er 1, 2020 and will end after 12 years on November 1, 2032. The advanced refunding of the 2014 Energy Lease reduced tota l debt service payments over the next 12 years by $1,513,227. This results is an econom ic gain (difference between the presen t values of the debt service payments on the old and new debt) of $1,425,483. Debt payable of $14,785,000 is recorded as Governmental Activities at June 30, 2022.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

95 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Certificates of Participation Bonds (Continued)

Series 2020A Energy (2014) (Continued)

In the event of an event of default, the Trustee may and, at the direction of the owners of not less than a majority of the aggregate principal amount of bonds then outstanding, and upon being indemnified to its reasonable satisfaction therefore, shall, upon notice in writing to the City and the Salinas Financing Authority, exercise any of the remedies granted to the Salinas Financing Authority under the lease agreement and, in addition, take whatever action at law or in equity may appear necessary or desirable to enforce its rights as assignee pursuant to the Assignment Agreement or to protect and enforce any of the rights vested in the Trustee or the owners, either at law or in equity bankruptcy or otherwise, whether for specific enforcement of any covenant or agreement or for the enforcement of any other legal or equitable right.

The annual debt service requirements to maturity for the certificates are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 935,000$ 589,750$ 1,524,750$
2024 1,005,000 550,950 1,555,950
2025 1,080,000 509,250 1,589,250
2026 1,155,000 464,550 1,619,550
2027 1,235,000 416,750 1,651,750
2028-2032 7,545,000 1,235,825 8,780,825 2033-2036 1,830,000 36,600 1,866,600 Total 14,785,000$ 3,803,675$ 18,588,675$

Series 2020A SVSWA (2015B)

On October 24, 1997, the Salinas Public Financing Authority issued City of Salinas Certificates of Participation (Certificates) Series A-1997 totaling $11,960,000. The purpo se of this financing was to raise money for capital improvement projects and to refund the Authority’s Variab le Rate Lease Revenue Bonds , which were issued to purchase the 65 W. Alisal Building. The Variable Ra te Lease Revenue Bonds Series A-1997 and Series B-1997 were fully retired on November 20, 1997. The outstanding Certificates were secured by liens on City owned assets that included City Hall; Public Safety Building; Steinbeck Library, and 65 W. Alisal Building.

On September 14, 2005, the Salinas Public Financing Authority issued City of Salinas Refunding Certificates of Participation Series 2005B (1997 Capital Improvement Projects). The Refunding Certificates were issued to refund Series A-1997 Certificates. Series 2005B Refunding Certificat es were issued in the amount of $11,705,000 for 24 years at 4.22%. The Refunding Certificates were secure d by a lien on the Salinas Community Center with an appraised value of $13,415,000. With these refunding, liens were removed from the City’s Public Safety Building, 65 West Alisal Building and Steinbeck Library.

On September 1, 2015, the City issued Refunding Cer tificates of Participation Series 2015, in the amount of $11,440,000 at a 2.53% interest rate, to refund the outstanding portion of the 2005A Certificates of Participation (Twin Creeks) and the 2005B Certificates of Participation (Capital Improvements). Bond started September 1, 2015 and will end after 12 years on September 1, 2027.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

96 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Certificates of Participation Bonds (Continued)

Series 2020A SVSWA (2015B) (Continued)

On August 19, 2020, the Salinas Public Financing Authority issued City of Salinas Certif icates of Participation, Series 2020A totaling $4,440,000. The Advance Refunding Ce rtificates were issued to refund the 2015B Salinas Valley Solid Waste Authority Bonds. Bond started N ovember 1, 2020 and will end after 7 years on November 1, 2027. The advance refunding of the 2015B Salinas Valley Solid Waste Authority advance refunding reduced total debt service payments over the next 7 years by $241,953. This results is an economic gain (difference between the present values of the debt service payments on the old and new debt) of $244,664. Debt payable of $3,335,000 is recorded as Governmental Activities at June 30, 2022.

In the event of an event of default, the Trustee may and, at the direction of the owners of not less than a majority of the aggregate principal amount of bonds then outstanding, and upon being indemnified to its reasonable satisfaction therefore, shall, upon notice in writing to the City and the Salinas Financing Authority, exercise any of the remedies granted to the Salinas Financing Authority under the lease agreement and, in addition, take whatever action at law or in equity may appear necessary or desirable to enforce its rights as assignee pursuant to the Assignment Agreement or to protect and enforce any of the rights vested in the Trustee or the owners, either at law or in equity bankruptcy or otherwise, whether for specific enforcement of any covenant or agreement or for the enforcement of any other legal or equitable right.

The annual debt service requirements to maturity for the certificates are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 545,000$ 122,500$ 667,500$
2024 565,000 100,300 665,300
2025 585,000 77,300 662,300
2026 610,000 53,400 663,400
2027 630,000 28,600 658,600
2028 400,000 8,000 408,000
Total 3,335,000$ 390,100$ 3,725,100$

Assessment District Bonds

At June 30, 2022, outstanding Assessment District Bonds totaled $8,290,000 plus bond premiums of $509,773.

Bonds issued for improvements in special assessment districts are liabilities of the property owners and are secured by liens against the assessed property. In the case of default, the City has the authority to advance bonds payments from the special reserve fund and to foreclosure on delinquent property. The bonds are secured by a pledge of the net revenue of the Assessment District and may not be u sed for any other purpose. The total Assessment District Reserve Fund balance was $1,822,791 at June 30, 2022.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

97 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Assessment District Bonds (Continued)

Assessment District 2017 Act Bonds

On July 28, 2017 the City issued $4,555,000 in bonds to refinance the following special assessment district debt:

 1998 AD 98-1 – Bella Vista III Refunding ($2,665,000)  2000 AD 96-2 – Acacia Park Refunding ($340,000)
 2002 RADA – Bella Vista Refunding ($1,365,000)
 2002 RADB – Bella Vista Refunding ($185,000)

The refunding of the assessment districts debt reduced total debt service payments over 9 years by $937,889. This results was an economic gain (difference between the pr esent values of the debt service payments on the old and new debt) of $318,303. Maximum debt service is $882,065, including interest ranging from 2.3% to 2.7% for 9 years. Debt payable of $970,000 is recorded in Governmental Activities at June 30, 2022.

Upon the occurrence of an event of default, the trustee shall be entitled to exercise the remedies provided under the agreement to compel the City to perfo rm and carry out their duties under the 1913 Act, the 1915 Act, or the 1984 Act and their agreements with the owners provided in the Bond agreement.

Annual debt service requirements to maturity for Assessment District 2017 Act Bonds are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 430,000$ 19,170$ 449,170$
2024 450,000 8,095 458,095
2025 45,000 1,823 46,823
2026 45,000 608 45,608
Total 970,000$ 29,696$ 999,696$

CFD Monte Bella-2019 – Community Facilities District No . 2016-1 (Monte Bella) of the City of Salinas 2019 Special Tax Bonds (Improvement Area No. 1)

On February 21, 2019, the Bond Purchase Agreement was si gned in the amount of $2,675,000 at various interest rates to finance the acquisition and/or construction of certain public facilities and improvements within Community Facilities District (CFD) No. 2016-1 Improvement Area No. 1 of the district. Debt payable net of premiums of $2,644,938 is recorded as Governmental Activities at June 30, 2022.

Upon the occurrence of an event of default, the trust ee may pursue any available remedy by law to enforce the payment of principal, premium and interest on the outstanding bonds.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

98 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Assessment District Bonds (Continued)

Annual debt service requirements to maturity CFD Monte Bella-2019 #1 bonds are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 55,000$ 104,769$ 159,769$
2024 55,000 103,669 158,669
2025 55,000 102,534 157,534
2026 55,000 100,575 155,575
2027 60,000 97,700 157,700
2028-2032 340,000 441,675 781,675 2033-2037 410,000 369,988 779,988 2038-2042 490,000 286,225 776,225 2043-2047 620,000 156,875 776,875 2048-2051 435,000 26,500 461,500 Total 2,575,000$ 1,790,510$ 4,365,510$

CFD Monte Bella-2019 #2 – Community Facilities District No. 2016-1 (Monte Bella) of the City of Salinas 2019 Special Tax Bonds (Improvement Area No. 2)

On December 1, 2019, the Bond Purchase Agreement was si gned in the amount of $2,090,000 at various interest rates to finance the acquisition and/or construction of certain public facilities and improvements within Community Facilities District (CFD) No. 2016- Improvement Area 2 of the district. Debt payable net of premiums of $2,246,888 is recorded as Governmental Activities at June 30, 2022.

Upon the occurrence of an event of default, the trust ee may pursue any available remedy by law to enforce the payment of principal, premium and interest on the outstanding bonds.

Annual debt service requirements to maturity CFD Monte Bella-2019 #2 bonds are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 40,000$ 87,350$ 127,350$
2024 45,000 85,850 130,850
2025 45,000 84,050 129,050
2026 45,000 82,250 127,250
2027 50,000 80,350 130,350
2028-2032 270,000 370,750 640,750 2033-2037 330,000 312,150 642,150 2038-2042 390,000 252,000 642,000 2043-2047 480,000 150,750 630,750 2048-2051 355,000 27,375 382,375 Total 2,050,000$ 1,532,875$ 3,582,875$

CFD Monte Bella-2019 #3 – Community Facilities District No. 2016-1 (Monte Bella) of the City of Salinas 2019 Special Tax Bonds (Improvement Area No. 3)
DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

99 Note 13 – Long-Term Debt (Continued)

A. Governmental Activities (Continued)

Assessment District Bonds (Continued)

On December 20, 2020, the Bond Purchase Agreement was signed in the amount of $2,695,000 at various interest rates to finance the acquisition and/or construction of certain public facilities and improvements within Community Facilities District (CFD) No. 2016- Improvement Area 3 of the District. Debt payable net of premiums of $2,937,947 is recorded as Governmental Activities at June 30, 2022.

Upon the occurrence of an event of default, the trust ee may pursue any available remedy by law to enforce the payment of principal, premium and interest on the outstanding bonds.

Annual debt service requirements to maturity CFD Monte Bella-2019 #3 bonds are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 50,000$ 106,550$ 156,550$
2024 55,000 104,700 159,700
2025 55,000 102,500 157,500
2026 55,000 100,300 155,300
2027 60,000 98,000 158,000
2028-2032 335,000 451,900 786,900 2033-2037 410,000 377,400 787,400 2038-2042 500,000 287,000 787,000 2043-2047 600,000 177,000 777,000 2048-2051 575,000 47,300 622,300 Total 2,695,000$ 1,852,650$ 4,547,650$

B. Business-Type Activities

A summary of changes in long-term debt for business-type activities for the year ended June 30, 2022 is as follows:

Prior Amount due Amount due in
Balance Period Balance within one more than one
July 1, 2021 Adjustments Additions Retirements June 30, 2022 year year Business-type Activities
Direct borrowings and placements:

Monterey Parking Garage 2014 lease 9,590,000$ -$ -$ (578,000)$ 9,012,000$ 599,000$ 8,413,000$ Street sweeper lease 113,167 (113,167) - - - - HUD Section 108 loan 1,953,000 (460,000) 1,493,000 478,000 1,015,000 Total direct borrowings and placements 11,656,167 (113,167) - (1,038,000) 10,505,000 1,077,000 9,428,000 Certificates of Participation:

Series 2020A-Twin Creeks 2,330,000 (2,330,000) - - - - - Series 2020B Fairways 3,930,000 (3,930,000) - - - - - Bond premium/(discount):

Series 2020A-Twin Creeks 272,085 (272,085) - - - - - Total Certificates of Participation: 6,532,085 (6,532,085) - - - - - Revenue Bonds:

Wastewater 2020A 14,425,000 - - (555,000) 13,870,000 560,000 13,310,000 Total Revenue Bonds 14,425,000 - - (555,000) 13,870,000 560,000 13,310,000 Total business-type activities 32,613,252$ (6,645,252)$ -$ (1,593,000)$ 24,375,000$ 1,637,000$ 22,738,000$

A prior period adjustment of $(6,645,252) was made to move certain debts to Governmental Activities.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

100
Note 13 – Long-Term Debt (Continued)

B. Business-Type Activities (Continued)

2014 Lease/Purchase Agreement

The 2014 Lease/Purchase Agreement was issued by the Salinas Facilities Financing Authority on January 29, 2014.

The financing was issued to refund the Animal Shelte r COP Series A-1999 ($2,812,000) and the Monterey Street Parking Structure COP Series A-2004 ($13,253,000). The Monterey Street Parking Structure portion of the financing was issued for 20 years (ending September 1, 203 3), at an average interest rate of 4.02%. Maximum annual debt service is $963,518. Debt payable of $9,012,000 is recorded in the Downtown Parking District Enterprise Fund at June 30, 2022 and reported is reported as business-type activities.

Upon the occurrence of an event of default, the trustee may pursue any available remedy by law or pursuant to the lease agreement to enforce payment of the outstanding amounts. However, there shall be no right under any circumstance to accelerate the lease payments or otherwi se declare any lease payments not then in default to be immediately due and payable. After the occurrence of an event of default, the City will surrender possession of the property to the financing authority, if requested to do so.

Debt service requirements to maturity is as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 599,000$ 350,243$ 949,243$
2024 625,000 325,640 950,640
2025 646,000 300,093 946,093
2026 674,000 273,561 947,561
2027 700,000 245,944 945,944
2028-2032 3,954,000 774,654 4,728,654 2033-2036 1,814,000 73,606 1,887,606 Total 9,012,000$ 2,343,741$ 11,355,741$

Direct Placement Debt

HUD Section 108 Loan

On March 28, 2015, the City entered into a contract fo r Loan Guarantee Assistance with the Housing and Urban Development Department (HUD), pursuant to which the City will derive funds fo r the purposes permitted under the agreement, and will execute one or more City Not es in the maximum aggregate principal amount of up to $9,390,000. The City executed a note numbered as B-12-MC-06-0005 (Community and Economic Development Fund – Industrial Waste Water Conveyance System Project) in the principal amount of $4,000,000. The City of Salinas has pledged current and future Community Development Block Grants (CDBG) funds as principal security for the loan. The loan carries a variable interest rate of 20 points (0.2%) above the applicable LIBOR rate. Debt payable of $1,493,000 is recorded in the Industrial Wast e Enterprise Fund at June 30, 2022 and is reported as business-type activities.

Upon the event of default, the custodian may take any action available by law, subject to the sections of the agreement, to pursue payment of the outstanding amount , including any additional fees, costs, and expenses incurred by the custodian in connection therewith.

DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

101
Note 13 – Long-Term Debt (Continued)

B. Business-Type Activities (Continued)

Direct Placement Debt (Continued)

Debt service requirements to maturity is as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 478,000$ 34,535$ 512,535$
2024 497,000 21,721 518,721
2025 518,000 7,382 525,382
Total 1,493,000$ 63,638$ 1,556,638$

2020A Wastewater Revenue Refunding Bonds – Series 2020A

On February 8, 2012, the City of Salinas issued Sanitary Sewer System Revenue Bonds, Series 2012 in the amount of $17,995,000 to provide funds for the current refunding of the City’s Sanitary Sewer System Revenue Bonds, Series 1998 and to finance capital replacement of existing sewer mains and other sewer related capital replacement.

Maximum annual debt service is $1,022,406, including interest ranging from 1.0% to 4.4% for 30 years. The City is authorized under Chapter 36, Article II, Division 5 of the Salinas City Code, to levy a sewer fee for the purpose of paying sanitary sewer related expenses of the City. On January 10, 2012, the City Council approved adjustments to wastewater collection fees effective February 1, 2012 to reflect the cost of wastewater conveyance through the Enterprise and an amount to cover debt service. The fee is billed by the Monterey Regional Water Pollution Control Agency.

On December 20, 2020, the Salinas Public Financing Authority issued City of Salinas Certificates of Participation, Series 2020A totaling $14,425,000. The Advance Refunding Certificates were issued to refund the 2012 Sewer Bonds. Bond started August 1, 2021 a nd will end after 21 years on August 1, 2042. The advance refunding of the 2012 Sewer Bonds reduced total debt serv ice payments over the next 21 years by $3,764,601. This results is an economic gain (difference between the present values of th e debt service payments on the old and new debt) of $1,346,741. Debt payable of $13,870,000 is recorded as Business-type Activities at June 30, 2022.

In the event of an event of default, the trustee shall, at written direction of the owners of not less than a majority in aggregate principal amount of the bonds at the time out standing, in each case, upon written notice to the City, declare the principal of all the bonds then outstanding, and the interest accr ued thereon, to be due and payable immediately.

Debt service requirements and maturity are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 560,000$ 300,293$ 860,293$
2024 565,000 297,532 862,532
2025 565,000 293,504 858,504
2026 565,000 288,233 853,233
2027 580,000 281,693 861,693
2028-2032 3,025,000 1,259,853 4,284,853 2033-2037 3,345,000 911,032 4,256,032 2038-2042 3,830,000 410,564 4,240,564 2043-2046 835,000 12,279 847,279 Total 13,870,000$ 4,054,983$ 17,077,704$
DRAFT 09.06.2023_v2
City of Salinas
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

102
Note 13 – Long-Term Debt (Continued)

B. Business-Type Activities (Continued)

Conduit Debt

In June 1999, the City of Salinas issued Multifamily Housing Revenue Bonds, Series 1999A ($5,310,000 tax- exempt) and 1999A-T ($390,000 taxable) for the constr uction of a 132-unit senior apartment project. Twenty percent (20%) of the project is designated to be affordable to seniors. As of June 30, 2022, the total conduit debt outstanding related to these bonds is $3,070,000.

On June 2007, the City of Salinas issued Economi cs Development Revenue Bonds, Series 2007A ($18,655,000 tax-exempt) and 2007B ($1,570,000 taxable) for the acquisition of a building located at 1000 Main Street in Salinas.

The building is currently leased in part to the County of Monterey Department of Social Services. The project intends to provide monthly rental at below the market value rates to the County of Monterey, a one-million-dollar premise improvement allowance to the Department of So cial Services to renovate and upgrade its space in the building and to generate charitable support for the County’s residents. The debt was refinanced in 2016 as series 2016A and 2016B. As of June 30, 2022, total conduit de bt outstanding related to the Economic Development Revenue Bonds is $13,760,000.

Pursuant to the bond purchase agreements, the City of Sa linas has no obligation related to the repayment of these bonds. Accordingly, the bonds are not reported as liabilities in the City’s financial statements.

C. Fiduciary Activities

A summary of changes in long-term debt for fiduciary activities for the year ended June 30, 2022 is as follows:

Amount due Amount due in
Balance Balance within one more than one
July 1, 2021 Additions Retirements June 30, 2022 year year Fiduciary Activities
Direct borrowings and placements:

Homeless Shelter loan payable 157,500$ -$ -$ 157,500$ -$ 157,500$ Total direct borrowings and placements 157,500 - - 157,500 - 157,500 Tax Allocation Refunding Bonds:
1996 Series A 1,625,000 - (130,000) 1,495,000 135,000 1,360,000 1992 Series A 333,539 - (172,406) 161,133 161,133 - Bond premium/(discount):
1996 Series A (26,754) - 8,919 (17,835) - (17,835) Total Tax Allocation Refunding Bonds 1,931,785 - (293,487) 1,638,298 296,133 1,342,165 Total fiduciary activities 2,089,285$ -$ (293,487)$ 1,795,798$ 296,133$ 1,499,665$

Loans and Notes Payable

Homeless Shelter Loan – Green Gold Inn

On March 7, 1995, the Salinas Redevelopment Agency – Ce ntral Agency Revitalization Project entered into a funding agreement and received a loan from the City of Salinas Community Development Block Grant Fund for the acquisition of property, Green Gold Inn at 28-32 Sole dad Street, to establish a homeless center/shelter. The Agency agreed that the property woul d be used solely for a homeless center/shelter for a period not less than ten years. If the Agency or the organization holding title to the property disposes of the property or alters the use of the property prior to expiration of the ten year period, the Agency will reimburse the City the full amount of the current fair market value less improvement costs.

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Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

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Note 13 – Long-Term Debt (Continued)

C. Successor Agency (Continued)

Loans and Notes Payable (Continued)

Upon completion of the ten-year period, one half of the debt, $157,500, was forgiven. Upon cessation of the homeless center/shelter operations, the City will be reimbursed the fair market value of the property less the portion of the loan paid and improvement costs.

Debt service requirements for Green Gold Inn homeless center/shelter no interest loan are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 -$ -$ -$ 2024 - - - 2025 - - - 2026 - - - 2027 - - - 2028-2032 - - - 2033-2037 - - - 2038-2041 157,500 - 157,500 Total 157,500$ -$ 157,500$

Tax Allocation Bonds

On August 28, 1996, the former Salinas Redevelopment Agency issued $11,145,000 of Tax Allocation Bonds Series A-1996. On October 27, 1992, the former Redevelopment Agency issued $6,541,178 of Refunding Tax Allocation Bonds Series A-1992. The bonds were issued to comple te project improvements in the Central Agency Revitalization Project area. The bonds were repaid from property taxes levied within the Salinas Redevelopment Agency Central City
Revitalization Project through January 31, 2012, the disso lution date. This debt is now being paid with taxes received from the Redevelopment Property Tax Trust Fund in accordance with the Recognized Obligation Payments Schedule submitted by the Successor Agency and approved by the State Department of Finance.

The Series A-1996 bond issue has a term bond of $4,510,000 that matures on November 1, 2023. Debt service payments beginning in fiscal year 2011-2012 are deposits into a sinking fund. The term bonds are subject to redemption prior to maturity from the sinking fund installments on each November 1 on and after November 1, 2011 without premium according to a speci fied schedule, which is used in these debt service requirements. The outstanding balance at June 30, 2022 was $1,495,000.

The annual debt service requirements for the 1996 Series A bonds at June 30, 2022 are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 135,000$ 78,512$ 213,512$
2024 1,360,000 37,400 1,397,400
Total 1,495,000$ 115,912$ 1,610,912$

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Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

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Note 13 – Long-Term Debt (Continued)

C. Successor Agency (Continued)

Tax Allocation Bonds (Continued)

The Series A-1992 bond issue has a term bond of $2,638,475 that matures on November 1, 2022. Debt service payments beginning in fiscal year 2009-2010 are deposits into a sinking fund. The term bonds are subject to redemption prior to maturity from the sinking fund insta llments on each November 1 on and after November 1, 2009 without premium according to a sp ecified schedule that is used in these debt service requirements. The outstanding balance at June 30, 2022 was $161,133.

The annual debt service requirements for the 1992 Series A bonds at June 30, 2022 are as follows:

Fiscal Year
Ending June 30: Principal Interest Total
2023 161,133$ 1,053,867$ 1,215,000$
Total 161,133$ 1,053,867$ 1,215,000$

Commitment to Monterey Street Parking Structure

In November 2001, the City Council and the Agency en tered into a Disposition and Development Agreement (DDA) with Maya Cinema Holding Company LLC for the development of a 14-Screen, 2,916-seat multiplex movie theater complex on the 100 block of Main Street. To serve this and other developments within the 100 blocks, the DDA committed the City/Agency to construct a five-lev el, 435-space public parking structure on the corner of Monterey Street and Market Street adjacent to the National Steinbeck Center and the Maya Cineplex Theater. The public parking garage opened in June 2005, while the Maya Cinemas Multiplex was completed and opened during July 2005. During FY 2013-14 the Certificates of Particip ation 2004 that funded the construction of the Monterey Street Parking Structure with a balance of $13,870,00 0 at January 2014, was refinanced through the Salinas Facilities Financing Authority by a direct private lease placement with Western Alliance Bancorporation. Because the debt service for the 2004 Certificates was reimbursed to the City from redevelopment tax increment, the savings from the 2004 Certificates was distri buted to affected taxing entities as apportioned by the County of Monterey, including a portion for the City, due to the dissolution of the City’s Redevelopment Agency. With this refinancing, the average annual debt service requirement was reduced by approximately $123,000.

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Notes to the Basic Financial Statements (Continued)
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Note 14 – Compensated Absences

Compensated absences are reported on the Government-Wid e Statements for Governmental Activities and Business- type Activities in Long-Term Debt. At June 30, 2022 the liability for all compensated absences totaled $12,172,829.

Compensated absences are reported on the financial statements in the following funds:

Prior Period Due within Due in more than
June 30, 2021 Adjustment Increases Decreases June 30, 2022 one year one year Governmental activities:

General Fund 9,548,105$ 226,345$ 77,845$ (1,189,104)$ 8,663,191$ 1,732,632$ 6,930,559$ Measure E 1,005,718 - 85,315 - 1,091,033 218,207 872,826 Measure G 1,372,191 - 112,766 - 1,484,957 296,991 1,187,966 Special revenue funds 308,687 - - (53,612) 255,075 51,015 204,060 Internal service funds 141,223 - - (10,537) 130,686 26,138 104,548 Total governmental activities 12,375,924 226,345 275,926 (1,253,253) 11,624,942 2,324,983 9,299,959 Business-type activities
Enterprise funds 607,904 (226,345) 166,328 - 547,887 109,577 438,310 Total business-type activities 607,904 (226,345) 166,328 - 547,887 109,577 438,310 Total primary government 12,983,828$ -$ 442,254$ (1,253,253)$ 12,172,829$ 2,434,560$ 9,738,269$

A prior period adjustment in the amount of $226,345 was made to move the liability from business-type activities to governmental activities.

Note 15 – Risk Management

The City has a self-insurance program and carries excess insurance for catastrophic losses. National Casualty Company combined with Berkley National Insurance Company pr ovides General Liability cove rage up to a maximum of $15,000,000 after the self-insured retention of $1,000,000 per occurrence met. Safety National Casualty Corporation provides Worker’s Compensation excess coverage with st atutory coverage (pursuant to California Worker’s Compensation Act) after the self-insurance retention of $1,000,000 for Public Safety and $750,000 for non-Public Safety is met.

Liabilities for estimated claims payable for the self-insurance programs represent settled claims, claims incurred but not paid and claims incurred but not reported based upon past experience, modified for current trends and information.

While the ultimate amount of losses incurred through June 30, 2022 is dependent on fu ture developments, City management has determined the desired reserve level for each self-insurance program as follows and believes the estimates are adequate to cover such losses.

Worker’s Compensation insurance liability of $26,950,000 includ es $22,331,055 for claims incurred but not paid and $4,618,945 for claims incurred but not reported which is based on expected cl aims and past claims history. At June 30, 2022, Worker’s Compensation In surance liability is reported on the st atement of net position. The worker’s compensation fund was established as an Internal Servi ce Fund on July 1, 1991. The portion of the worker’s compensation insurance liability since July 1, 1991, at June 30, 2022 is $25,311, 515 and is reported in the Internal Service Fund and $1,638,485 is treated as general long-term debt.

General liability insurance liability at June 30, 2022 of $4,340,195 that is reported in the Internal Service Fund includes $3,261,437 for claims incurred but not paid and $1,078,758 for claims incurred but not reported which is based on expected claims and past cl aims history. A deficit is reported with the internal service funds of $3,014,068 at June 30, 2022 and is short the City’s goal of reserving three times the self-insured retention plus full funding of all past claims history. The City’s self-insured retention is $1,000,000 at June 30, 2022.

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Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

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Note 15 – Risk Management (Continued)

At June 30, 2022, the City’s insurance claims liability is recorded as follows:

Internal Serv ice General
Funds Long-term Debt Total
Worker's compensation 25,311,515$ 1,638,485$ 26,950,000$ General liability 4,340,195 - 4,340,195 Total 29,651,710$ 1,638,485$ 31,290,195$

Changes to the claims liability for fiscal year ended June 30, 2022 are as follows:

Worker's General
Compensation L iability Total
Beginning balance of claims liability 26,656,171$ 3,157,700$ 29,813,871$ Less beginning provisions for incurred
but not reported claims (5,331,234) (1,076,220) (6,407,454) Beginning provisions for incurred but
not paid claims 21,324,937 2,081,480 23,406,417 Increase (decrease) in claims incurred
and reported 5,964,695 2,789,033 8,753,728 Claims expenses paid (4,958,577) (1,609,076) (6,567,653) Ending balance provision for incurred
but not paid claims 22,331,055 3,261,437 25,592,492 Provisions for incurred but not
reported claims 4,618,945 1,078,758 5,697,703 Ending balance of claims liability 26,950,000$ 4,340,195$ 31,290,195$ Amount due within one year 4,420,503$ 3,069,479$ 7,489,982$ Amount due in more than one year 22,529,497 1,270,716 23,800,213 Total 26,950,000$ 4,340,195$ 31,290,195$

Note 16 – Unearned Revenues and Deferred Inflows of Resources

Governmental funds report unearned re venues in connection with funds recei ved, in advance for which assets recognition criteria have been met, but for which revenue recognition criteria have not been met. Receivables for revenues not considered available to liquidate liabilities of the current period are considered unavailable revenues and reported as deferred inflows of resources on the governmenta l funds. Unearned revenues are stated at $63,428,897, in the Government-Wide Statements. Governmental funds report $63,428,897 of unearned revenues and $8,230,637 of unavailable revenues as deferred inflows of resources that are not available resources.

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Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

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Note 16 – Unearned Revenues and Deferred Inflows of Resources, Net of Allowance (Continued)

Unearned revenues of the governmental activities at June 30, 2022 consist of the following:

Governmental Activities:

Major funds:

American Rescue Plan Act (ARPA) Fund 50,875,929$
Housing and Urban Development Grant Fund 4,078,807
Nonmajor funds:

Special revenue funds:

Grants Fund 184,161
Debt service funds:

Assessment District Debt Service 970,000
2019 Special Tax Montebella 7,320,000
Total governmental activities 63,428,897$

Unavailable revenues of the governmental activities at June 30, 2022 consist of the following:

Governmental Activities: Type
Major funds:

Housing and Urban Development Fund 3,743,533$ Housing loans Special revenue funds:

Vehicle Abatement Fund 40,121 Unavailable grants receivable Affordable Housing Fund 756,258 Housing loans Grants Fund 345,800 Unavailable grants receivable Capital projects funds:

Special Construction Assistance Fund 3,215,947 Unavailable grants receivable Special Aviation Fund 128,978 Unavailable grants receivable Total governmental activities 8,230,637$

Note 17 – Retirement Programs

A. Summary

The City of Salinas provides defined benefit retirement program benefits through the California Public Employees’ Retirement System (“CalPERS”) and New York Life. As of June 30, 2022, the City was contributing to agent multiple-employer defined benefit pension plans and cost-sharing multiple-employer defined benefit pension plans through CalPERS, and was also contributing to a single-employer defined benefit pension plan through New York Life.

Net pension liabilities are reported in the financial statements as follows:

Governmental Business-Type
Net Pension Liability Activities Activities Total
CalPERS pension plans:

Agent multiple-employer - Miscellaneous 15,393,994$ 1,900,685$ 17,294,679$ Agent multiple-employer - Safety-Police 84,155,587 - 84,155,587 Cost sharing multip le-employer - Safety Fire 33,145,570 - 33,145,570 New York Life - single employer 3,560,476 - 3,560,476 Total net pension liability 136,255,627$ 1,900,685$ 138,156,312$ DRAFT 09.06.2023_v2
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Notes to the Basic Financial Statements (Continued)
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Note 17 – Retirement Programs

A. Summary (Continued)

Deferred outflows of resources related to pensions are reported in the financial statements as follows:

Governmental Business-Type
Deferred Outflows of Resources Activities Activities Total CalPERS pension plans:

Agent multiple-employer - M iscellaneous 5,341,164$ 659,470$ 6,000,634$ Agent multiple-employer - Safety-Police 13,918,001 - 13,918,001 Cost sharing multip le-employer - Safety Fire 14,007,322 - 14,007,322 New York Life - single employer 162,458 - 162,458 Total deferred outflows of resources 33,428,945$ 659,470$ 34,088,415$

Deferred inflows of resources related to pensions are reported in the financial statements as follows:

Governmental Business-Type
Deferred Inflows of Resources Activities Activities Total CalPERS pension plans:

Agent multiple-employer - Miscellaneous 10,240,212$ 1,264,352$ 11,504,564$ Agent multiple-employer - Safety-Police 25,134,766 - 25,134,766 Cost sharing multip le-employer - Safety Fire 23,042,424 - 23,042,424 New York Life - single employer 790,816 - 790,816 Total deferred inflows of resources 59,208,218$ 1,264,352$ 60,472,570$

Pension expense reported in the financial statements as follows:

Governmental Business-Type
Pension Expense Activities Activities Total
CalPERS pension plans:

Agent multiple-employer - M iscellaneous 2,033,692$ 251,099$ 2,284,791$ Agent multiple-employer - Safety-Police 7,191,658 - 7,191,658 Cost sharing multip le-employer - Safety Fire 5,941,674 - 5,941,674 New York Life - single employer 1,856,239 - 1,856,239 Total pension expense 17,023,263$ 251,099$ 17,274,362$ DRAFT 09.06.2023_v2
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Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

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Note 17 – Retirement Programs (Continued)

B. California Public Employees Retirement System Agent Multiple-Employer Plans

Plan Description

All qualified permanent and probationary employees are eligible to participate in the City of Salinas’ separate Safety (police) and Miscellaneous (all other) Plans, agent multiple -employer defined benefit pension plans administered by the California Public Employees’ Retirement System (CalPERS), which acts as a common investment and administrative agent for its participating member employers. Benefit provisions under the Plans are established by State statute and Local Government resolution. CalPERS i ssues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.

Employees Covered

At June 30, 2021, the measurement date, the following employees were covered by the benefit terms for the Plan:

M iscellaneous Safety - Police
Inactive employees or beneficiaries currently receiving benefits 196 269 Inactive employees entitled to, but not yet receiving benefits 268 117 Active employees 269 156
Total 733 542

Benefits Provided

CalPERS provides service retirement and disability benefits, a nnual 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.

The City’s provisions and benefits in effect at June 30, 2022 are summarized as follows:

Prior to On or After
January 1, 2013* January 1, 2013
Benefit formula 2.0% @ 55 2.0% @ 62
Benefit vesting schedule 5 years of service 5 years of service Benefit payments Monthly for life Monthly for life
Retirement age 50-55 52-67
Monthly benefits, as a % of eligible 2.0% to 2.45% 1.0% to 2.5% Required employee contribution rates 7.00% 7.00%
Required employer contribution rates 8.62% 8.62%
Miscellaneous
Hire date

Prior to On or After
January 1, 2013* January 1, 2013
Benefit formula 3.0% @ 50 2.7% @ 57
Benefit vesting schedule 5 years of service 5 years of service Benefit payments Monthly for life Monthly for life
Retirement age 50 52-57
Monthly benefits, as a % of eligible 3.00% 2.0% to 2.7% Required employee contribution rates 9.00% 13.50%
Required employer contribution rates 21.98% 21.98%
Safety - Police
Hire date
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Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

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Note 17 – Retirement Programs (Continued)

B. California Public Employees Retirement System Agent Multiple-Employer Plans (Continued)

Benefits Provided (Continued)

Contribution Description - Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires that the employer contribution rates for all public employe rs are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employer contribution rates may change if plan contracts are amended.

Payments made by the City to satisfy contribution requirements that are identified by the pension plan terms as plan member contribution requirements are classified as plan member contributions.

The contributions made by the City were as follows:

Employer Contributions
Miscellaneous 4,193,288 $
Safety - Police 12,406,841

Actuarial Methods and Assumptions used to determine Total Pension Liability - The June 30, 2020 valuation was rolled forward to determine the June 30, 2020 total pension liability, based on the following actuarial methods and assumptions:

Valuation Date
M easurement Date
Actuarial Cost Method
Actuarial Assumptions:

Discount Rate
Inflation
Salary Increases
Morta l i ty Ra te Ta bl e
Post Retirement Benefit Increase
June 30, 2020
June 30, 2021
Entry Age Normal

7.15%

2.50%
Varies by Entry Age and Service
Derived using CalPERS’ Membership Data for all Funds. Contract COLA up to 2.50% until purchasing power applies.

Protection allowance floor on purchasing power applies.

(1) The mortality table used was developed based on Ca lPERS-specific data. The ta ble includes 15 years of mortality improvement using Society of Actuaries 90% of Scale MP 2016. For more details on this table, please refer to the December 2017 Experience Study report (based on CalPERS demographic data from 1997 to 2015) that can be found on the CalPERS website.

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 calculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long -term returns. The expected rate of return was then set equal to the single equivalent rate calculated above and adjusted to account for assumed administrative expenses.

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Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

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Note 17 – Retirement Programs (Continued)

B. California Public Employees Retirement System Agent Multiple-Employer Plans (Continued)

Benefits Provided (Continued)

The expected rates of return by asset class are as follows:

Asset Class New S trategic Allocation Real Return Years 1 - 10 1 Real Return Years 11 +
2 Global equity 50.00% 4.80% 5.98%
Global fixed income 28.00% 1.00% 2.62%
Inflation sensitive assets 0.00% 7.00% 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%
Total 100.00%
1 An expected inflation of 2.00% was used for this period. 2 An expected inflation of 2.92% was 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 required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

Amortization of Deferred Outflows and Deferred Inflows of Resources - Under GASB 68, gains and losses related to changes in total pension liability and fiduciary net position are recognized in pension expense systematically over time.

The first amortized amounts are recognized in pension expense for the year 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:

Difference between projected and actual earnings on pension plan investments:

 5 years straight-line amortization

All other amounts:

 Straight-line amortization over the average expected remaining service lives (EARLS) of all members that are provided with benefits (active, inactive, and retired) as of the beginning of the measurement period.

Deferred outflows of resources and deferred inflows of resources relating to Differences between Expected and Actual Experience, Changes of Assumptions and employer-specific amounts should be amortized over the EARSL of members provided with pensions through the Plan. The EARSL for the miscellaneous and safety (police) plans for the June 30, 2021 measurement date are 4.1 and 3.5 years, respectively, which was obtained by dividing the total service years by the total number of participants (active, inactive, and retired) in the Plan. Inactive employees and retirees have remaining service lifetimes equal to zero. Total future service is based on the members' probability of decrementing due to an event other than receiving a cash refund.

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Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

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Note 17 – Retirement Programs (Continued)

B. California Public Employees Retirement System Agent Multiple-Employer Plans (Continued)

Benefits Provided (Continued)

Changes in Net Pension Liability – The following tables show the changes in the net pe nsion liability for each of the City’s agent multiple-employer defined benefit pension plans recognized over the measurement period:

Total Pension Liability
Plan Fiduciary Net
Position Net Pension Liability
Balance at June 30, 2020 (Valuation Date) 133,299,386$ 100,787,549$ 32,511,837$ Changes in the year:

Service cost 3,130,339 - 3,130,339 Interest on the total pension liabilities 9,498,842 - 9,498,842 Changes in assumptions - - - Differences between expected and actual experience 727,132 - 727,132 Benefit payments, including refunds of members contributions (5,481,505) (5,481,505) - Plan to plan resource movement - - - Contributions - employer - 4,273,977 (4,273,977) Contributions - employee - 1,464,611 (1,464,611) Net investment income - 22,935,564 (22,935,564) Administrative expenses - (100,681) 100,681 Net changes 7,874,808 23,091,966 (15,217,158) Balance at June 30, 2021 (Measurement Date) 141,174,194$ 123,879,515$ 17,294,679$ Miscellaneous Plan

Total Pension Liability
Plan Fiduciary Net
Position Net Pension Liability
Balance at June 30, 2020 (Valuation Date) 325,186,524$ 206,759,103$ 118,427,421$ Changes in the year:

Service cost 6,086,593 - 6,086,593 Interest on the total pension liabilities 22,716,035 - 22,716,035 Changes in assumptions - - - Differences between expected and actual experience (2,364,429) - (2,364,429) Benefit payments, including refunds of members contributions (16,317,199) (16,317,199) - Plan to plan resource movement - - - Contributions - employer - 11,629,887 (11,629,887) Contributions - employee - 2,305,151 (2,305,151) Net investment income - 46,981,535 (46,981,535) Administrative expenses - (206,540) 206,540 Net changes 10,121,000 44,392,834 (34,271,834) Balance at June 30, 2021 (Measurement Date) 335,307,524$ 251,151,937$ 84,155,587$ Safety - Police

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Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

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Note 17 – Retirement Programs (Continued)

B. California Public Employees Retirement System Agent Multiple-Employer Plans (Continued)

Benefits Provided (Continued)

Pension Plan Fiduciary Net Position - Detailed information about each plan’s fiduciary net position is available in the separately issued CalPERS financial report.

Sensitivity of the Net Pension Liability to Changes in the Discount Rate – The following presents the net pension liability of the Plan as of the Measurement Date, calculated using the discount rate of 7.15 percent, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage-point lower (6.15 percent) or 1 percentage-point higher (8.15 percent) than the current rate:

Discount Rate - 1% Current Discount Discount Rate + 1%
(6.15%) Rate (7.15%) (8.15%)
Miscellaneous 36,786,033$ 17,294,679$ 1,200,340$ Safety - Police 130,063,023$ 84,155,587$ 46,590,081$ Plan's Aggregate Net Pension L iability/(Asset)

Pension Expense and Deferred Outflows and Deferred Inflows of Resour ces Related to Pensions For the measurement period ending June 30, 2021 (the measurement date), the City of Salinas recognized a pension expense of $9,476,449 for the miscellaneous and safety (police) plans.

For the measurement period ending June 30,2021 (the measurement date), the City of Salinas reports other amounts for the miscellaneous and safety (police) plans as deferred outflow and deferred inflow of resources related to pensions as follows:

Deferred outflows Deferred inflows
of Resources of Resources
Pension contributions made subsequent
to measurement date 4,193,288$ -$ Difference between projected and actual
earning on pension plan investments - (11,392,473) Changes in assumptions - (112,091) Differences between expected and actual experience 1,807,346 - Total 6,000,634$ (11,504,564)$ Miscellaneous

Deferred outflows Deferred inflows
of Resources of Resources
Pension contributions made subsequent
to measurement date 12,406,841$ -$ Difference between projected and actual
earning on pension plan investments - (23,445,888) Changes in assumptions - - Differences between expected and actual experience 1,511,160 (1,688,878) Total 13,918,001$ (25,134,766)$ Safety - Police
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Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

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Note 17 – Retirement Programs (Continued)

B. California Public Employees Retirement System Agent Multiple-Employer Plans (Continued)

Benefits Provided (Continued)

$4,193,288 and $12,406, 841 reported as deferred outflows of resources to contributions subsequent to the measurement date for the miscellaneous and safety police pl ans, respectively, will be recognized as a reduction of the net pension liability in the year ending June 30, 2023.

Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:

Miscellaneous Safety - Police
Year Ended June 30,
2023 (2,017,896)$ (5,348,547)$ 2024 (2,033,398) (5,860,355) 2025 (2,517,796) (5,955,333) 2026 (3,128,128) (6,459,371) 2027 - -
Thereafter - - (9,697,218)$ (23,623,606)$
Deferred Outflows/(Inflows)
of Resources
Deferred Outflows/(Inflows)
of Resources

C. California Public Employees Retirement System Cost-Sharing Multiple Employer Plan

Plan Description – All qualified permanent and probationary employees are eligible to participate in the City’s separate Safety risk pool (Fire Tier 1 & Tier 2), cost -sharing multiple-employer defined benefit pension plans administered by CalPERS, which acts as a common investment and administrative agent for its participating member employers. Benefit provisions under the Plans ar e established by State statute and Local Government resolution. CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.

Benefits Provided - CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full time employment.

The City’s plans provisions and benefits in effect at June 30, 2022, are summarized as follows:

Prior to On or After Prior to On or After
January 1, 2013* January 1, 2013 January 1, 2013* January 1, 2013 Benefit formula 3.0% @ 50 2.7% @ 57 3.0% @ 55 2.5% @ 57 Benefit vesting schedule 5 years of service 5 years of service 5 years of service 5 years of service Benefit payments Monthly for life Monthly for life Monthly for life Monthly for life Retirement age 50 52-57 55 52-57
Monthly benefits, as a % of eligible 3.00% 2.0% to 2.7% 3.00% 2.0% to 2.7% Required employee contribution rates 9.00% 13.75% 9.00% 13.25% Required employer contribution rates 25.59% 13.75% 22.47% 13.25% Hire date
Safety - Fire
Tier 1 Tier 2
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Note 17 – Retirement Programs (Continued)

C. California Public Employees Retirement System Cost-Sharing Multiple Employer Plan (Continued)

Contribution Description - Section 20814(c) of the Ca lifornia Public Employees’ Retirement Law (“PERL”) requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through the CalPERS annual actuarial valua tion process. 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 employe r is required to contribute the difference between the actuarially determined rate and the contribution rate of employees.

The City’s contribution for the safety fire plan were as follows:

Employer Contributions
Safety - Fire 6,791,444$

Pension Liabilities, Pension Expense and Deferred Outflows/Deferred Inflows of Resources Related to Pensions – As of June 30, 2022, the City reported net pension liabilities for its proportionate share of the net pension liability as of June 30, 2022 and 2021 were as follows:

Plan Total Pension Plan Fiduciary Net Plan Net Pension
L iability Position L iability/(Asset)
Balance at: 6/30/20 (Valuation date) 187,360,606$ 134,725,054$ 52,635,552$ Balance at: 6/30/21 (Measurement date) 193,123,087 159,977,517 33,145,570 Net changes during 2020-2021 5,762,481$ 25,252,463$ (19,489,982)$ Increase (Decrease)

The City’s net pension liability is measured as the proportionate share of the net pension liability. The net pension liability is measured as of June 30, 2021, and the total pe nsion liability used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 20 20 rolled forward to June 30, 2021 using the standard update procedures. The City’s proportion of the net pension liability was based on a projection of the City’s long- term share of contributions to the pension plans relative to the projected contributions for all participating employers actuarially determined.

The City’s proportionate share of the net pension liability as of the June 30, 2021 and 2020 measurement dates were as follows:

Proportion June 30, 2020 0.483764%
Proportion June 30, 2021 0.612870%
Change - Increase (Decrease) 0.129106%
Percentage Share of Risk Pool

For the year ended June 30, 2022 (m easurement date June 30, 2021), the City of Salinas recognized a pension expense of $5,941,674 for the Safety Plan (Fire).

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C. California Public Employees Retirement System Cost-Sharing Multiple Employer Plan (Continued)

As of June 30, 2022 the City of Salinas reports deferred outflow and deferred inflow of resources related to pensions as follows:

Deferred outflows Deferred inflows
of Resources of Resources
Pension contributions made subsequent
to measurement date 6,791,444$ -$ Difference between projected and actual earning on
pension plan investments - (19,727,986) Adjustment due to differences in proportions 1,552,985 (39,252) Changes in assumptions - - Difference between actual and expected experience 5,662,893 - Difference between employer's actual contributions
and proportionate share of contributions - (3,275,186) Total 14,007,322$ (23,042,424)$
Safety - Fire

$6,791,444 reported as deferred outflows of resources for contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ending June 30, 2023.

Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expenses as follows:

Year Ended June 30,
Deferred Outflows/
(Inflows) of Resources
2023 (2,910,422)$
2024 (3,247,609)
2025 (4,239,649)
2026 (5,428,866)
2027 -
Thereafter -
(15,826,546)$

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Note 17 – Retirement Programs (Continued)

C. California Public Employees Retirement System Cost-Sharing Multiple Employer Plan (Continued)

Actuarial Methods and Assumptions used to determine Total Pension Liability - The June 30, 2020 valuation was rolled forward to determine the June 30, 2021 total pension liability, based on the following actuarial methods and assumptions:

Actuarial Cost Method
Actuarial Assumptions:

Discount Rate 7.15%
Inflation 2.50%
Salary Increases
Morta l i ty Ra te Ta bl e
Post Retirement Benefit Increase
Derived using CalPERS’ Membership Data for all Funds.

The mortality table The mortality table used was
developed based on CalPERSspecific data. The table
includes 15 years of mortality improvements using Society of Actuaries Scale 90% of Scale MP 2016. For more
details on this table, please refer to the December 2017 experience study report (based on CalPERS demographic
data from 1997 to 2015) that can be found on the CalPERS website.

Contract COLA up to 2.50% until Purchasing Power
Protection Allowance Floor on Purchasing Power applies.

Entry Age Normal in accordance with the requirement of
GASB Statement No. 68
Varies by Entry Age and Service

Discount Rate - The discount rate used to measure the total pension liability for PERF C 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 required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all peri ods of projected benefit paym ents to determine the total pension liability.

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 calculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equal to the single equivalent rate calculated above and adjusted to account for assumed administrative expenses.

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C. California Public Employees Retirement System Cost-Sharing Multiple Employer Plan (Continued)

The expected real rates of return by asset class are as follows:

Asset Class
New
S trategic
Allocation
Real Return
Years 1 -
10 1
Real Return
Years 11 +
2 Global equity 50.00% 4.80% 5.98%
Global fixed income 28.00% 1.00% 2.62%
Inflation sensitive 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%
Total 100.00%
1 An expected inflation of 2.00% was used for this period. 2 An expected inflation of 2.92% was used for this period.

Amortization of Deferred Outflows and Deferred Inflow s of Resources – The Net Difference Between Projected and Actual Investment Earnings on Pension Plan Investments is amortized over a five-year period on a straight-line basis. One-fifth is recognized in pension expense during the measurement period, and the remaining Net Difference Between Projected and Actual Investment Earnings on Pe nsion Plan Investments is amortized over the remaining amortization periods. The Net Difference Between Projected and Actual Investment Earnings on Pension Plan Investments in the Schedule of Collective Pension Amounts represents the unamortized balance relating to the current measurement period and the prior measurement periods on a net basis.

Deferred Outflows of Resources and Deferred Inflows of Resources relating to Differences Between Expected and Actual Experience and Changes of Assumptions are am ortized over the Expected Average Remaining Service Lifetime (EARSL) of members provided with pensions th rough the Plan determined as of the beginning of the related measurement period. The EARSL for PERF C for the measurement date ending June 30, 2020 is 3.8 years, which was obtained by dividing the total service years of 548,581 (the sum of remaining service lifetimes of the active employees) by 145,663 (the total num ber of participants: active, inactiv e, and retired) in PERF C. Inactive employees and retirees have remaining service lifetimes equal to 0. Total future service is based on the members’ probability of decrementing due to an event other than receiving a cash refund.

Sensitivity of Proportionate Share of Net Pension Liability (Asset) to Changes in the Discount Rate – The following presents the proportionate share of the net pension liability of the City’s Plan as of the Measurement Date, calculated using the discount rate of 7.15 percent, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage-point lower (6.15 percent) or 1 percentage-point higher (8.15) than the current rate:

Discount Rate - 1% Current Discount Discount Rate + 1%
(6.15%) Rate (7.15%) (8.15%)
59,141,605$ 33,145,570$ 11,793,039$ Plan's Aggregate Net Pension L iability/(Asset)

Pension Plan Fiduciary Net Position – Detailed information about each plan’s fiduciary net position is available in the separately issued CalPERS financial report.

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Note 17 – Retirement Programs (Continued)

D. New York Life Single Employer Retirement Plan

Plan Description – The New York Life retirement plan is a closed single-employer defined benefit pension plan that covers Non-Public Safety Employees. The plan’s benefits offers a formula of 2% @ 60 for vested employees.

The Plan was established on September 1, 1954 and has been amended and restated from time to time since that date. Prior Plan amendments eliminated the six-month service requirement for entry into the plan and credited participants with up to six-months of service from hire to plan entry prior to time change. The Plan was amended and restated effective September 1, 1996 to bring the Plan into compliance with the Internal Revenue Code and Regulations promulgated there by to provide for the City’s pick-up of em ployee eligible participants equal to the present value of vested accrued benefits. Effective June 1, 2001, the Plan amended its be nefit formula to one that uses an average salary computed from the twelve-month period, replacing the old formul a that used an average salary computed from a thirty six month period. As of June 19, 1995, all new regular non-public safety employees are enrolled in CalPERS.

The City has an agreement with New York Life to hold and invest plan assets of the Retirement Plan, which covers employees other than Police and Fire. New York Life holds assets in NYL Fixed Dollar Account, NYL Mainstay Total Return Bond Fund, and NYL Guaranteed Annuity Contracts.

New York Life Guaranteed Annuity Contracts in the amount of $5,813,965 are allocated insurance contracts set up to pay benefits and accordingly are excluded from the tota l pension liability, and are not reported in the City’s financial statements.

Employees Covered – As of September 1, 2021 (valuation date), the followi ng employees were covered by the benefit terms for the single-employer defined benefit pension plan:

NY Life Plan
Inactive employees or beneficiaries currently receiving benefits 41 Inactive employees entitled to, but not yet receiving benefits 7 Active employees 7
Total 55

Benefits - Non-Public Safety personnel benefits vest after five years of service. The vested benefit would be in the form of a pension beginning after attaining age 60 equal to the benefits accrued at time of termination, or for a reduced amount if an election is made to have payments commence before attaining the normal retirement age of

60. City employees who retire at or after age of 60 with five years of credited service are entitled to an annual retirement benefit payable monthly, as a straight line annu ity, as a ten year certain and life annuity, or as a lump sum, in an amount equal to 2% of the average earnings paid to the employee during the twelve consecutive months of service with the City during which their earnings were highest, multiplied by the number of years and completed months of plan participation.

The plan allows early retirement after reaching age 55 and completing five years of plan participation. The plan also provides death and survivor benefits.

Funding Policy – The contribution requirements of Plan members and the City are established and may be amended by the City Council. Prior to January 1, 1979, participants were required to make specified levels of contributions to the plan in order to accrue benefits under the Pl an. For the period commencing January 1, 1979 through December 31, 1993, there were no participants’ contributions under this Plan. Since January 1, 1994, participants are required to contribute 4.5% of their compensation to the Plan. Since September 1, 1996, participant contributions are made by the City under the employee pretax pick-up provision for government-sponsored plans allowed under the Internal Revenue Code. As establishe d in their Memorandum of Understanding document for personnel of the SEIU Blue Collar bargaining group, the C ity will contribute four and one-half percent of the employee retirement contribution.

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Note 17 – Retirement Programs (Continued)

D. New York Life Single Employer Retirement Plan (Continued)

Pension Liabilities, Pension Expense and Deferred Outflows /Inflows of Resources Relate d to Pensions – As of June 30, 2022 (Measurement Date - August 31, 2021) and June 30, 2021, (Measurement Date – August 31, 2020), the City reported net pension liability as follows:

Plan Total Pension Plan Fiduciary Net Plan Net Pension
L iability Position L iability/(Asset)
Balance at: 8/31/20 (measurement date) 13,890,599$ 5,911,440$ 7,979,159$ Balance at: 8/31/21 (measurement date) 13,422,823 9,862,347 3,560,476 Net changes during 2020-2021 (467,776)$ 3,950,907$ (4,418,683)$ Funded Status @ 8/31/21 measurement date 73.47%
Increase (Decrease)

The City’s net pension liability is measured as of August 31, 2021, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of September 1, 2021.

Changes in Net Pension Liability – The following tables show the changes in the net pension liability for the City’s Single-Employer Pension Plan recognized over the measurement period:

Total Pension
Liability
Plan Fiduciary Net
Position
Net Pension
Liability
Balance at 6/30/2021 (8/31/20 measurement date) 13,890,599$ 5,911,440$ 7,979,159$ Changes in the year:

Service cost 345,756 - 345,756 Interest on the total pension liabilities 283,983 - 283,983 Changes in assumptions (37,244) - (37,244) Differences between expected and actual experience 1,595,858 - 1,595,858 Benefit payments, including refunds of members contributions (2,656,129) (2,656,129) - Plan to plan resource movement - - - Contributions - employer - 5,695,926 (5,695,926) Contributions - employee - 34,635 (34,635) Net investment income - 894,536 (894,536) Administrative expenses - (18,061) 18,061 Net changes (467,776) 3,950,907 (4,418,683) Balance at June 30, 2022 (8/31/21 measurement date) 13,422,823$ 9,862,347$ 3,560,476$ New York Life Plan

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Note 17 – Retirement Programs (Continued)

D. New York Life Single Employer Retirement Plan (Continued)

Sensitivity of the Net Pension Liability to Changes in the Discount Rate – The following presents the net pension liability of the Plan as of the Measurement Date, calculated using the discount rate of 2.14 percent, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage-point lower (1.14 percent) or 1 percentage-point higher (3.14 percent) than the current rate:

Discount Rate - 1% Current Discount Discount Rate + 1%
(1.14%) Rate (2.14%) (3.14%)
4,708,758$ 3,560,476$ 2,652,390$ Plan's Aggregate Net Pension L iability/(Asset)

As of June 30, 2022, the City reports deferred outflows and deferred inflows of resources related to pensions as follows:

Deferred outflows Deferred inflows
of Resources of Resources
Pension contributions made subsequent
to measurement date 162,458 $ -$
Difference between projected and actual earning on pension plan investments - (790,816) Total 162,458$ (790,816)$
New York Life Plan

$162,458 reported as deferred outflows of resources for cont ributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ending June 30, 2023.

Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expenses as follows:

Year Ended June 30, Deferred Outflows/
2023 (233,661)$
2024 (245,627)
2025 (177,398)
2026 (134,130)
2027 -
Thereafter -
(790,816)$

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Note 17 – Retirement Programs (Continued)

D. New York Life Single Employer Retirement Plan (Continued)

Actuarial Methods and Assumptions used to Determine Total Pension Liability - For the measurement period ended August 31, 2021 (measurement date), the total pension liability was determined by using the following actuarial assumptions, applied to all periods included in the measurement:

Valuation date
M easurement date
Contribution policy
Actuarial cost method
Actuarial assumptions:

Discount rate
Long-term expected rate of return on
assets

3.4% at August 31,
2020
Inflation
Morta l i ty
Mortality improvement
Salary Increases
Retirement
Disability, termination
Benefit form for current actives
NY Life guaranteed annuity contract Value of payments expected to be made under contract excluded from total pension liability (contract assets not included in fiduciary net position) August 31, 2021
Entry Age Normal

2.14% at August 31, 2021 - discount rate used is the lower of (1) expected long-term rate of return on investments, and (2) Bond Buyer 20-Bond GO Index as of the measurement date

2.25%
Aggregate - 2.5% annually; merit - CalPERS 2000-2019 Experience Study 100% retire once the retirement benefit reaches 70% of the average monthly compensation
None
City contributes full ADC
CalPERS 2000-2019 Experience Study
Post-retirement mortality projected fully generational with Scale MP-2021.

Disability - annuity for all participants; lump sum for all other participants, valued using UP-1984 Mortality Table with 1% interest rate
September 1, 2021

Changes Since Prior Measurement Date – The following changes were applied since the prior measurement date of August 31, 2021:

Changes of assumptions - discount rate was updated based on municipal bond rate as of the measurement date.

Changes of benefit terms - none

Discount Rate – The discount rate used to measure the total pension liability was 2.14%. The discount rate is based on the expected rate of return which is lower than th e 20 year municipal bond rate. The projection of cash flows used to determine the discount rate assumed that employee contributions will be made at current contribution rates and City contributions will be made at rates equal to the difference between actuarially determined contribution rates and the employee rate.

Based on those assumptions, the pension plan’s fiduciary net position was not projected to be available to make all projected future benefit payments of current active and inactive employees. The City’s annual contributions will be adjusted to keep the plan solvent.

.

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Note 17 – Retirement Programs (Continued)

E. ICMA Retirement Corporation Defined Contribution Plan

Investments are with New York Life. Expected rate of return is as follows:

Target Expected Rate
Asset Class Allocation of Return
Fixed income 100.00% 0.78%
Assumed long-term rate of inflation 2.25%
Expected long-term rate of return, rounded 2.75%

Pension Plan Fiduciary Net Position - Detailed information about the pensio n plan’s fiduciary net position as of August 31, 2021 is as follows:

New York
Li fe
Assets:

Investments:

New York Life Fixed Dollar Account 537,804$
New York Life Mainstay Total Return Bond Fund 5,813,965 Total investments 6,351,769
Liabilities:

Accrued expenses -
Fiduciary net position 634,129$

Plan Description – On June 19, 1995, the City established a qualified retirement program in accordance with Internal Revenue Code Section 401(a). This defined contribution 401(a) Money Purchase Retirement Plan was established with International City Managers Association Retirement Corporation (ICMA). Non-Public Safety Mid- Management employees that were participating in the ICMA 457 non-qualified deferred compensation plan in-lieu of participation in the New York Life Retirement Program, were required to transfer to one of the other City’s three qualified retirement plans. The City’s annual contribution to this plan is determined by the employer required contribution to the New York Life Plan Retirement Plan in accordance with Internal Revenue contribution limits.

Significant Accounting Policies

Basis of Accounting – Financial statements are prepared using the cash basis of accounting. Employer contributions are recognized in the period that the contributions are made.

Method Used to Value Investments – Participants direct their investments, without restriction, among various investments options available under the ICMA 401(a) Plan. Retirement Buyback Program During Fiscal Year 1995- 96, the City established a deferred compensation retirement buyback program for Department Directors where the City contributes a flat dollar amount based on tenure with the City. The 401(a) Money Purchase Retirement Plan is administered by the ICMA Retirement Corporation. The program requires employee-matching contributions for every dollar contributed by the City. At June 30, 2022, th ere were 5 participants rece iving a total of $114,127 in this form of benefit while there were 2 participants in the ICMA 401(a) money Purchase Plan with a City annual contribution was $19,781 while the employees had an equal mandatory matching contribution of $19,781.

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Note 17 – Retirement Programs (Continued)

F. Deferred Compensation Plans

The City has four deferred compensation plans created in accordance with Internal Revenue Code Section 457. The Small Business Job Protection Act of 1996 requires the establishment of a trust or similar vehicle to ensure that the assets of Deferred Compensation Plans under the Internal Revenue Code Section 457 are protected and used exclusively for the benefit of Plan participants and/or their beneficiaries. According to these laws the City established Employer Trust arrangements for each of the Plans before January 1, 1999.

The City has established Employer Trust agreements with ICMA Retirement Corporation, Mass Mutual Financial Group, and Central Coast Credit Union. In 1998, the City Council adopted a Resolution amending the City administered deferred compensation plans to conform to the new law protecting the plan participant assets from any claim against the City. Under the Trust arrangement, individual accounts maintained by the record-keeper used for receiving contributions and paying di stributions must be subject to the Tr ust. The existence of the Trust does little to change the Plan structure excep t to add a layer of protection for money set aside for the employee against claims of the Employer’s creditors. The law also allows an increase in the amount a participant may contribute to differ each year, based on changes in the consumer price index.

International City Manager’s Association (ICMA) Retirement Corporation

As of June 2021, the International City Manager’s A ssociation Retirement, Inc., (ICMA-RC), is now Mission Square Retirement and the Plan had 418 participants and a balance of $55,295,611 at June 30, 2022. All employees are eligible to participate through voluntary salary deduction. Some management employees participated in lieu of participation in the New York Life Retirement Program until June 19, 1995 when a qualified 401(a) retirement program was established. These assets are not reported on the City’s financial statements at June 30, 2022 pursuant to the Employer Trust established by the City with ICMA Retirement Corporation during November 1997.

Trust Deed Program

The City administers a Trust Deposit Fund that includes a deferred compensation plan funded solely by the voluntary salary reductions. The goal of the Trust Deed program is to invest participants’ funds in short-term deeds of trust (notes). This investment option is administer ed within the City of Salinas by the City’s appointed administrator of the Deferred Compen sation Plan. Loans are based on equity after obtaining a fee appraisal. All property is physically inspected and the loan package is reviewed and appr oved/disapproved by a Deferred Compensation Committee. All employees are eligible to participate. The Plan had 228 participants and a balance of $7,275,923 in net assets at June 30, 2022. The balance in these plans is available to employees only upon termination, retirement, death or unforeseen emergenc y. While the Employer Trust established by the City on December 15, 1998 protects these funds from creditors of the City, because the City ad ministers the plan assets, they are included in the City’s financial statements at June 30, 2022.

The Trust Deed Program is managed on a cash basis with interest posted when received and expenditures posted when paid. Interest and expenditures are allocated to pa rticipants based on month end cash balances. Trust deed notes secured by property taken back in foreclosure, are reevaluated based on the current market value of the property. When the value of property taken back in for eclosure is less than the note secured by that property, the note is written-down to current market value (less forecl osure and sales expenses) of the property. Gains are recognized only when properties are sold. Gains or losses ar e allocated to plan participants based on month end cash balances.

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Note 17 – Retirement Programs (Continued)

F. Deferred Compensation Plans (Continued)

Trust Deed Program (Continued)

As of June 30, 2022, pursuant to GAS B 72, properties held for resale were valued by independent real estate professionals (market approach) and trust deed notes were valued at their present value (income approach). The valuations are considered Level 3. Th e value of properties held for resale are reduced for cost of sales. The notes (loans) are valued based on amounts investors would likel y pay for notes with interest rates ranging from 6% for all current loans discounted to provide loan to valu es ranging from 70% to 50% depending on property type and condition, borrowers payment history and term remaining on note. The change in net realizable values are reflected in the Statement of Changes in Fiduciary Net Assets.

Central Coast Federal Credit Union (CCFCU)

This third deferred compensation plan was established in August 1993. The plan funds are backed by the full faith and credit of the U.S. Government and are also insure d by the National Credit Union Administration (NCUA), an agency of the federal government for up to $250,000. Central Coast collateralizes any amounts invested in their savings accounts in excess of NCUA insurance limits in accordance with applicable law. As of December 31, 2020, CCFCU became the service provider for the plan and th e City keeps the employees’ enrollment and send their payroll elective deduction to CCFCU.

There were 78 participants with a balance at June 30, 2022 is $7,074,352. All employees are eligible to participate through voluntary salary deductions. The assets for this plan are not reported on the City’s financial statements.

Mass Mutual Financial Group (Empower Retirement)

The fourth Deferred Compensation plan was established in September 2000. This retirement savings plan enables employees to defer a portion of their current compensation for payment at later date, generally retirement. Salary deferrals (or contributions) are voluntary and are made through the ease of payroll deduction. Empower Retirement former Mass Mutual offers a variety of investment vehicles that vary in risks, term and return to the investment.

These investment options are offered through a group variable annuity contract. There were 28 participants with a balance of $3,448,722 at June 30, 2022. All employees are eligible to participate through voluntary salary deductions. The assets for this plan are not reported on the City’s financial statements.

Note 18 – Other Postemployment Benefits

Items related to other postemployment benefits are recorded in the financial statements as follow:

Governmental Business-Type
Activities Activities Total
Net OPEB Liability 16,238,956$ 819,308$ 17,058,264$ Deferred outflows of resources 5,248,155 264,787 5,512,942 Deferred inflows of resources 11,250,198 567,609 11,817,807 OPEB expense 1,134,784 57,254 1,192,038

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Note 18 – Other Postemployment Benefits (Continued)

A. General Information About the OPEB Plan

For purposes of measuring the net OPEB liability, deferred outflows of resources, and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the City’s plan (OPEB Plan) and additions to/deductions from the OPEB Plan’s fiduciary net position have been determined on the same basis.

Generally accepted accounting principles require that th e reported results must pertain to liability and asset information within certain defined timeframes.

For this report, the following timeframes are used:

Valuation date June 30, 2021
Measurement date June 30, 2021
Measurement period July 1, 2020 to June 30, 2021
Fiscal year end June 30, 2022

Plan Description: The City joined the Public Employees' Medical & Hospital Care Act (PEMHCA) in 2000 for Police and Miscellaneous employees, offered through the California Public Employees’ Retirement System (CalPERS). It is an agent multiple-employer plan administered by California Public Employees’ Retirement System (CalPERS). The healthcare plan which provides medical insurance benefits to active and eligible retirees and their families in accordance with various la bor agreements. Fire employees receiv e healthcare benefits for active and retiree members from a union sponsored plan.

OPEB Trust: The City joined The California Employer s’ Retiree Benefit Trust (CERBT) in 2011 to prefund it’s OPEB liability. CERBT is an agent multiple employer defined plan for other postemployment benefits administered by CalPERS. The Plan includes participating employers of the State of California and public agencies. CalPERS is governed by a 13-member Board of Administration (the Board); two elected by CalPERS members, one elected by retired members of CalPERS, two appointed by the Gove rnor, one public representative appointed jointly by the Speaker of the Assembly and Senate Rules Committee, and four ex-officio members: State Treasurer, State Controller, Director of California Department of Human Resources, and Designee of the State Personal Board. The Board is responsible for the management and control of CalPERS, including the exclusive control of the administration and investments of the Plan.

The plan information is as follows:

Fiscal year end June 30, 2022
Plan type Agent multip le-employer
OPEB trust Yes
Special funding situations No
Nonemployer contributing entities No

Post-Employment Benefits Eligibility: The City provides post-retirement healthcare benefits to eligible employees who retire directly from the City after the age of 50 years (Age 52 for Miscellaneous PEPRA employees) and with five years of service or disability retirement. For Police a nd Fire Supervisors, the City pays 25% of retiree and spouse health insurance premium up to $100 per month plus PEMHCA AB2544 “unequal method” monthly benefit to retirees ($139 per month in 2021). The payment is made until Medicare eligibility, but no more than 10 years for non-supervisory Police retirees. For Miscellaneous employees, the City pays the PEMHCA “unequal method” monthly benefit to retirees ($143 per month in 2021). For IAFF (Fire employee), the City pays 25% of retiree and spouse health insurance premium up to $100 per month. The payment is made until Medicare eligibility.

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Notes to the Basic Financial Statements (Continued)
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Note 18 – Other Postemployment Benefits (Continued)

A. General Information About the OPEB Plan (Continued)

Employees Covered: As of the June 30, 2021 actuarial valuation, the following current and former employees were covered by the benefit terms under the PEMHCA and Union Sponsor Plans:

Number of
Covered
Participants
Inactive employees currently receiving benefits 144
Inactive employees entitled to, but not yet receiving benefits 352 Active employees 501
Total 997

Contributions: The City intends to contribute to the Trust the actuarially determined contribution (“ADC”) net of the pay-as-you-go benefits paid annually directly from employer resources. For the fiscal year ended June 30, 2022, the City’s cash contributions were $300,206 in premium payments made on behalf of retirees, $250,000 payments to the trust, implied subsidy payments of $385,000, and administrative e xpenses of $4,845, resulting in total payments of $941,051.

Discount Rate: The discount rate used to measure the total OPEB liability was 3.87%. The projection of cash flows used to determine the discount rate assumed that City cont ributions will be made at rates equal to the actuarially determined contribution rates. Based on those assumptions, the OPEB plan’s fiduciary net position was projected to be available to make all projected OPEB payments for current active and inactive employees and beneficiaries.

Therefore, the long-term expected rate of return on OPEB plan investments was applied to all periods of projected benefit payments to determine the total OPEB liability.

Expected Long Rate of Return: The long-term expected ra te of return on OPEB plan investments was determined using a building block method in which expected future real rates of return (expected returns, net of OPEB plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future r eal rates of return by the target asset allocation percentage and by adding expected inflation. Th e target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset Class
Target
Allocation*
CERBT-Strategy
Expe cte d Re al
Rate of Return
Global equity 59.00% 4.82%
Fixed income 25.00% 1.47%
TIPS 5.00% 1.29%
Commodities 3.00% 0.84%
REITs 8.00% 3.76%
100.00%
Assumed long-term rate of inflation 2.75%
Expected long-term rate of return, rounde
d 6.75%
* Policy target effective October 1, 2018

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Note 18 – Other Postemployment Benefits (Continued)

B. Net OPEB Liabilities, Expense, and Deferred Outflows/Inflows of Resources

Changes in the OPEB Liability: The changes in the net OPEB liability for the City Plan are as follows:

Total Plan Net
OPEB Fiduciary OPEB
Liability Net Position Liability
Balance at June 30, 2021 27,819,852$ 3,058,247$ 24,761,605$ Changes Recognized for the M easurement Period:

Service Cost 1,639,274 - 1,639,274 Interest on the total OPEB liability 884,846 - 884,846 Changes in benefit terms - - - Difference between expected and actual experience (4,117,866) - (4,117,866) Changes in assumptions (4,258,871) - (4,258,871) Contribution from the employer - 959,007 (959,007) Net investment income - 897,217 (897,217) Administrative expenses - (5,500) 5,500 Benefit payments (704,749) (704,749) - Net changes during July 1, 2021 to June 30, 2022 (6,557,366) 1,145,975 (7,703,341) Balance at June 30, 2022 21,262,486$ 4,204,222$ 17,058,264$

Discount Rate Sensitivity Analysis: The following schedul e shows the impact of the Net OPEB Liability if the discount rate used was 1% less than and 1% greater than the discount rate that was used (3.87%) in measuring the Net OPEB Liability.

Discount Rate -1% Current Discount Rate Discount Rate +1% (2.87%) (3.87%) (4.87%)
20,457,340$ 17,058,264$ 14,325,309$ Plan's Total OPEB Liabiltiy

Healthcare Trend Sensitivity Analysis: The following presents the net OPEB liability of the City if it were calculated using healthcare cost trend rates that are one percentage point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2021:

Healthcare Cost
-1% Trend Rate +1%
13,993,313$ 17,058,264$ 20,994,494$ Plan's Total OPEB Liabiltiy

OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB:

For the fiscal year ended June 30, 2022, the City recognized OPEB expense of $1,192,038.

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Note 18 – Other Postemployment Benefits (Continued)

B. Net OPEB Liabilities, Expense, and Deferred Outflows/Inflows of Resources (Continued)

As of fiscal year ended June 30, 2022 , the City reported deferred outflows of resources and inflows of resources related to OPEB from the following sources:

Deferred Deferred
Outflows of Inflows of
Resources Resources
Contributions made after measurement date 940,051$ -$ Differences between expected and actual experience - (6,392,087) Changes in assumptions 4,572,891 (4,945,910)
Net difference between projected and actual
earnings of OPEB Plan investments - (479,810) 5,512,942$ (11,817,807)$

Deferred outflows of resources in the amount of $940,051 related to contributions subsequent to the measurement date and will be recognized as a reduction of the net OPEB liability during the fiscal year ending June 30, 2023.

Other amounts reported as deferred inflows of resources rela ted to OPEB will be recognized as OPEB expenses as follows:

Year Ending
June 30 Amount
2023 (1,104,499)$
2024 (1,099,953)
2025 (1,103,502)
2026 (1,122,748)
2027 (892,723)
Thereafter (1,921,491)
Total (7,244,916)$

Recognition of Deferred Outflows and Deferred Inflows of Resources: To smooth market volatility, gains and losses related to changes in total OPEB liab ility and fiduciary net position are recogni zed over nine and half years. Amounts are first recognized in OPEB expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to OPEB and are to be recognized in future OPEB expense.

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Notes to the Basic Financial Statements (Continued)
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Note 18 – Other Postemployment Benefits (Continued)

B. Net OPEB Liabilities, Expense, and Deferred Outflows/Inflows of Resources (Continued)

Actuarial Methods and Assumptions Used to Determine the OPEB Liability: The City’s net OPEB liability was measured as of June 30, 2020. The total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation dated June 30, 2019 based on the following significant actuarial methods and assumptions:

Actuarial valuation date June 30, 2021
Contribution policy City contributes $250,000 annually and pays benefit outside of trust Discount rate 3.87%
Municipal bond rate 3.87% (Bond Buyer 20-bond Index)s
Expected long-term rate of return on investment 6.25%
General inflation 2.50%
Mortality, retirement, disability, termination CalPERS 2000-2019 experience study Mortality improvement Mortality projected fully generational with Scale MP-2021 Salary increases Aggregate - 2.75% annually; merit - CalPERS 2000-2019 experience study M edical trend
PEM HCA minimum increases 4.00% annually
Cap increases None
Healthcare participation
Non-Medicare - 6.50% for 2023, decreasing to an ultimate rate of 3.75% in 2076
Medicare - 5.65% for 2023, decreasing to an ultimate rate of 3.75% in 2076 100% for Safety $100 benefit
50% for PEMHCA benefit if covered is active
50% for PEMHCA benefit if waived is active

Note 19 – Net Position and Fund Balances

A. Government-Wide Statements

Net Investment in Capital Assets

The following is the calculation of net investment in capital assets at June 30, 2022:

Governmental Business-type
Activities Activities Total
Capital assets, net of accumulated depreciation
and amortization 334,963,510$ 72,245,474$ 407,208,984$ Less: outstanding principal on capital related debt, net (130,404,431) (24,375,000) (154,779,431) Add: loss on refunding of debt - 103,051 103,051 Net investment in capital assets 204,559,079$ 47,973,525$ 252,532,604$

B. Fund Financial Statements

Fund Balance Classification

It is the policy of the City to maintain a minimum reserve for a reasonable level of assurance that the City’s day-to-day operations will be able to continue even if circumstances occur where revenues are insufficient to cover expenditures.

The minimum reserve of the General Fund is 5% of th e next year’s General Fund annual budgeted operating expenditures, as calculated by the Finance Director. The minimum fund balance is shown as unassigned in the General Fund.

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Note 19 – Net Position and Fund Balances (Continued)

B. Fund Financial Statements (Continued)

At June 30, 2022, fund balances are classified in the governmental funds as follows:

American Housing and
Rescue Plan Act Urban Development
(ARPA) Grant Non-major Total
General Special Revenue Special Revenue Governmental Governmental Fund Fund Fund Funds Funds
Nonspendable
Loans and notes receivable -$ -$ 66,568$ 16,571$ 83,139$ Advances (long-term portion) 2,785,000 - - - 2,785,000 Land held for resale - - - 1,380,000 1,380,000 Total nonspendable 2,785,000 - 66,568 1,396,571 4,248,139 Restricted
Public safety - - - 1,628,387 1,628,387 Future development - - - 16,896,096 16,896,096 Maintenance districts - - - 8,897,158 8,897,158 Street repairs - - - 23,711,730 23,711,730 Grants/special projects - - - 1,974,244 1,974,244 Low/moderate income housing - - - 3,145,651 3,145,651 115 trust reserve 6,000,000 - - - 6,000,000 Capital projects - - - 12,536,414 12,536,414 Debt service - - - 4,211,073 4,211,073 Total restricted 6,000,000 - - 73,000,753 79,000,753 Committed
Capital projects 5,319,323 - - 2,141,985 7,461,308 Economic contingency reserve 16,685,000 - - - 16,685,000 Infrastructure maintenance reserve 3,684,000 - - - 3,684,000 OPEB reserve 1,000,000 - - - 1,000,000 Facilities maintenance reserve 1,577,000 - - - 1,577,000 Community Center reserve 8,100,000 - - - 8,100,000 Total committed 36,365,323 - - 2,141,985 38,507,308 Assigned
Other purposes - - - - - Carryover appropriations 15,266,804 - - - 15,266,804 Operating reserve - - - - - Total assigned 15,266,804 - - - 15,266,804 Unassigned (deficit) 9,567,543 - (2,838,755) (424,366) 6,304,422 Total fund balances 69,984,670$ -$ (2,772,187)$ 76,114,943$ 143,327,426$

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Notes to the Basic Financial Statements (Continued)
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Note 19 – Net Position and Fund Balances

B. Encumbrances (Continued)

The City uses encumbrances to control expenditure commitments for the year and to enhance cash management.

Encumbrances represent commitments related to contract s not yet performed and purchase orders not yet filled (executor contracts; and open purchase orders). Commitments for such expenditures of monies are encumbered to reserve a portion of applicable appropriations. Encumb rances still open at year end are not accounted for as expenditures and liabilities but, rather, as restricted, committed, or assigned governmental fund balance.

As of June 30, 2022, total governmental fund encumbrance balances for the City are as follows:

General Fund -$
Americal Rescue Plan Act Fund
Housing and Urban Development Grant Fund -
Nonmajor governmental funds -
-$

Note 20 – Other Required Disclosures

A. Expenditures Exceeding Appropriations

For the year ended June 30, 2022, the following fund s had excess expenditures over appropriations, which are expected to be covered with existing fund balance or had sufficient available revenue:

Excess Expenditures
Fund Function over Appropriations
General Fund Public safety 432,075$
General Fund Interest and fiscal charges 20,285
Emergency Medical Service Special Revenue Fund General Government 223,939 Emergency Medical Service Special Revenue Fund Public safety 73,463 2020A Refunding SVSWA Debt Service Fund DS: Principal 400,000

B. Net Position Deficit and Restrictions

The government-wide statement of net position reports an unrestricted deficit of $(111,270,940) and $76,573,216 of restricted net position.

Note 21 – Joint Venture – Salinas Valley Solid Waste Authority

The Salinas Valley Solid Waste Authority (“Authority”) is a jo int exercise of powers authority, created pursuant to an agreement dated as of January 1, 1997 (the “Authority Ag reement) among the County of Monterey, and the cities of Salinas, Gonzales, Greenfield, Soledad, and King City (the “Members”). The Authority was established to acquire and manage the landfill assets of each member, ensure long-term landfill capacity of the Authority service area and provide a unified and coordinated solid waste management for the members.

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Note 21 – Joint Venture – Salinas Valley Solid Waste Authority (Continued)

The Authority is governed by a nine member governing board, consisting of three members of the Salinas City Council, two members of the Monterey County Board of Supervisors, and one member from each patriating city. Pursuant to the Authority Agreement, while the City does not have unilateral control over the activities of the Authority, the affirmative vote of at least one member of the Authority Board who is a member of the Salinas City Council is required to approve Board actions.

With the formation of the Authority, each participating juri sdiction contractually agreed to its responsibilities. In addition, the Authority adopted waste delivery agreements with each Member of the Authority. Each member has committed to deliver waste generated w ithin its boundaries to the Authority’s solid waste facilities, to direct its franchise/permitted solid waste haulers to dispose of waste at these facilities, and to pay tipping fees set by the Authority to cover all Authority-related costs.

The agreement may be terminated under specific terms of withdrawal, which includes a majority vote of the City Council, repayment of all outstanding debt and funding of closure, post closure and site remediation costs upon withdrawal from or termination of the Authority. The member s have made no equity contri butions, or have sold their interest in their assets to the Authority, and there is no explicit, measurable equity interest in this joint venture.

The City had no measurable equity interest in the Aut hority and does not receive a share of operating results. The Authority is currently funding the closur e, post closure and site remediation co sts based on estimates of these future costs. The Annual Financial Report of the Salinas Valley Solid Waste Authority is published and available from the Authority Treasurer at the Authority’s Finance Department located at 128 Sun Street, Suite 101, Salinas, CA 93901.

On December 6, 2018, the City issued a notice of inte ntion to withdraw from the Jo int Powers Agreement (the “Agreement”) Pursuant to Section 19 of the Joint Powers Agreement, the notice serves as a one-year notice. The City’s notice of intent to withdraw as a member of the Authority merely served as notice to the Authority and its remaining members. The one-year term has passed without any further action from the City or the Authority. However, the City and Authority representatives are working on finding a resolution to the notice.

The City understands and acknowledges its obligation to c ontinue paying its share of the 2014 Bonds as regularly scheduled and agrees to continue paying its share of the obligation after withdrawal from the Authority, should withdrawal occur. In addition, the City understands and acknowledges its obligation to pay its share of financial liability for closure and post-closure and site remediation costs as fu rther described in Section 19(a) of the Agreement. If the City withdraws from the Authority arrangements must be made to meet this obligation.

Note 22 – Commitments and Contingencies

A. Claims and Litigation

The City is directly and indirectly involved in various suits relating principally to claims arising from construction contracts, personal injury, and propert y damage. In the opinion of the City Attorney and City’s management, potential claims against the City resulting from such litiga tion, not covered by insurance, would not materially affect the basic financial statements of the City. As a result, no liability has been accrued by the City relating to these matters as of June 30, 2022.

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Note 23 – Prior Period Adjustments

Governmental Business-Type Fiduciary
Activities Activities Activities
Net position, as previously reported, at July 1, 2021 116,252,267$ 84,870,502$ 19,484,100$ Move enterprise funds to General Fund 24,996,820 (24,996,820) - Remove land disposed in previous year - - (149,270) Remove land and properties held for resale disposed in previous year (500,431) - - Net position at July 1, 2021, as restated 140,748,656$ 59,873,682$ 19,334,830$

L andfill Redev elopment
Recreation Municipal Affordable Municipal Storm Garbage Water Obligation Parks Art Housing Golf Courses Sew er Surcharge Utility Retirement Fund Ge n e ral S pe ci al Re ve nu e S pe ci al Re ve nu e S pe ci al Re ve nu e En te rpri s e En te rpri s e En te rpri s e En te rpri s e Fi du ci ary Fund Fund Fund Fund Fund Fund Fund Fund Fund
Fund balance/net position, as previously reported, at July 1, 2021 64,495,539$ 71,498$ 10,911$ 4,737,817$ (9,566,038)$ 34,219,186$ 283,158$ 60,514$ 97,672$ Group special revenue funds into General Fund 82,409 (71,498) (10,911) - - - - - - Move beginning net position of enterprise funds into General Fund 24,996,820 - - - 9,566,038 (34,219,186) (283,158) (60,514) Remove land disposed in previous year - - - - - - - - (149,270) Remove land and properties held for resale disposed in previous year - - - (500,431) - - - - - Remove beginning balances transferred from enterprise funds: