Agenda packet — Seal Beach City Council, February 24, 2025 (part 1 of 2)

A G E N D A

MEETING OF THE CITY COUNCIL
Monday, February 24, 2025 ~ 7:00 PM
City Council Chambers
211 Eighth Street
Seal Beach, California

LISA LANDAU
MAYOR
Third District

NATHAN STEELE
MAYOR PRO TEM
Fifth District

JOE KALMICK
COUNCIL MEMBER
First District

BEN WONG
COUNCIL MEMBER
Second District

PATTY SENECAL
COUNCIL MEMBER
Fourth District
This Agenda contains a brief general description of each item to be considered. No action or discussion shall be taken on any item not appearing on the agenda, except as otherwise provided by law. Supporting documents, including agenda staff reports, and any public writings distributed by the City to at least a majority of the Council Members regarding any item on this agenda are available on the City’s website at www.sealbeachca.gov.

City Council meetings are broadcast live on Seal Beach TV-3 and on the City's website (www.sealbeachca.gov). Check SBTV-3 schedule for the rebroadcast of meetings. The meetings are also available on demand on the City’s website (starting 2012).

In compliance with the Americans with Disabilities Act of 1990, if you require disability related modifications or accommodations, including auxiliary aids or services to attend or participate in the City Council meeting, please call the City Clerk's office at (562) 431-2527 at least 48 hours prior to the meeting.

CITY COUNCIL NORMS:

Adopted on June 12, 2023
• Maintain a citywide perspective, while being mindful of our districts. • Move from I to we, and from campaigning to governing. • Work together as a body, modeling teamwork and civility for our community. • Assume good intent.
• Disagree agreeably and professionally.
• Utilize long range plans to provide big picture context that is realistic and achievable. • Stay focused on the topic at hand. Ensure each member of Council has an opportunity to speak.
• Demonstrate respect, consideration, and courtesy to all. • Share information and avoid surprises.
• Keep confidential things confidential.
• Respect the Council/Manager form of government and the roles of each party. • Communicate concerns about staff to the City Manager; do not criticize staff in public.

CIVILITY PRINCIPLES:

Treat everyone courteously;
Listen to others respectfully;
Exercise self-control;
Give open-minded consideration to all viewpoints;
Focus on the issues and avoid personalizing debate; and, Embrace respectful disagreement and dissent as democratic rights, inherent components of an inclusive public process, and tools for forging sound decisions.

@CITYOFSEALBEACH @CITYOFSEALBEACHCA @SEALBEACHCITYCA @SEALBEACHRECREATION&COMMUNITYSERVICES @SEALBEACH_LIFEGUARD @SEALBEACHPOLICEDEPARTMENT @SEALBEACHPOLICE @SEALBEACHPUBLICWORKS
@K9YOSA
@K9.SAURUS

CALL TO ORDER

PLEDGE OF ALLEGIANCE

COUNCIL ROLL CALL

PRESENTATIONS / RECOGNITIONS
• 50 Annual Americana Awards Presentation
• Parking Technology Upgrades Presentation
• Annual Comprehensive Financial Report (ACFR) Presentation

ORAL COMMUNICATIONS
At this time members of the public may address the Council regarding any items within the subject matter jurisdiction of the City Council. Pursuant to the Brown Act, the Council cannot discuss or take action on any items not on the agenda unless authorized by law. Matters not on the agenda may, at the Council's discretion, be referred to the City Manager and placed on a future agenda.

Those members of the public wishing to speak are asked to come forward to the microphone and state their name for the record. All speakers will be limited to a period of five (5) minutes. Speakers must address their comments only to the Mayor and entire City Council, and not to any individual, member of the staff or audience. Any documents for review should be presented to the City Clerk for distribution. Speaker cards will be available at the Clerk’s desk for those wishing to sign up to address the Council, although the submission of a speaker card is not required in order to address the Council.

Emailed comment received from JO8N.

Supplemental Communication received from City Clerk Harper – Item H Pulled to be considered at a future meeting
Supplemental Communication received during Public Comment from Chad Berlinghieri
Supplemental Communication received during Public Comment from James Lingle
Supplemental Communication received during Public Comment from Jon Janecek

APPROVAL OF AGENDA & WAIVER OF FULL READING OF RESOLUTIONS

ORDINANCES
By motion of the City Council this is the time to notify the public of any changes to the agenda and /or rearrange the order of the agenda.

CITY ATTORNEY REPORT Nicholas Ghirelli, City Attorney
CITY MANAGER REPORT Patrick Gallegos, Interim City Manager

COUNCIL COMMENTS
General Council Member comments and reporting pursuant to AB 1234. th
COUNCIL ITEMS – None

CONSENT CALENDAR
Items on the consent calendar are considered to be routine and are enacted by a single motion with the exception of items removed by Council Members.

A. Approval of the City Council Minutes - That the City Council approve the minutes of the Closed Session and Regular City Council meetings held on February 10, 2025.

B. Demand on City Treasury (Fiscal Year 2025) - Ratification.

C. Monthly Investment Report (February 24, 2025) - Receive and file.

D. City of Seal Beach Annual Audit Reports for Fiscal Year Ending June 30, 2024 - That the City Council receive and file the following documents for the Fiscal Year ending June 30, 2024:

A. Audit Communication Letter
B. Report on Internal Control
C. Annual Comprehensive Financial Report
D. Appropriations Limit Final Report
E. Amendment 1 to the Professional Special Counsel Services Agreement with Telecom Law Firm, P.C. - That the City Council adopt Resolution 7617:

1. Approving Amendment 1 to the Professional Special Counsel Services Agreement with Telecom Law Firm, P.C. to approve an increase in compensation of $30,000 for professional legal and general telecommunications services for a revised total not-to-exceed amount of $70,000, and a 12-month extension to expire on June 30, 2026; and, 2.

Directing the Interim City Manager to execute Amendment 1 on behalf of the City.

F. Approving the FY 2025-2026 West Orange County Water Board Budget - That the City Council adopt Resolution 7618 approving the FY 2025-2026 West Orange County Water Board budget of $1,683,800, of which the City’s proportionate agency contribution is $286,771.

G. Notice of Completion for the North Seal Beach Community Center, CIP BG2501 - That the City Council adopt Resolution 7619: 1. Accepting the North Seal Beach Community Center Project, by MDJ Management, LLC in the amount of $404,023.76; and, 2. Directing the City Clerk to file a “Notice of Completion” with the Orange County Clerk-Recorder within 15 days from the date of acceptance and to release retention 35 days after recordation of the Notice of Completion contingent upon no claims being filed on the Project.

H. Approving and Authorizing Amendment 2 to the Professional Services Agreement with Raftelis Financial Consultants, Inc. for Water and Wastewater Financial Planning Services - That the City Council adopt Resolution 7620: 1. Approving Amendment 2 to the Professional Services Agreement with Raftelis Financial Consultants, Inc. dated June 12, 2023, as previously amended by Amendment 1 dated March 25, 2024, to provide additional Water and Wastewater Financial Planning Services; increase compensation for such additional services by $51,527 for a revised total contract not-to-exceed amount of $187,294; and extend the term to December 31, 2025; and,2. Authorizing and directing the Interim City Manager to execute Amendment 2 on behalf of the City; and, 3. Authorizing the Interim City Manager to approve unforeseen additional work requests, up to the total notto-exceed amount of $10,000.

I. Parking Enforcement Automated License Plate Reader (ALPR) and Supporting Equipment Refresh - That the City Council adopt Resolution 7621: 1. Approving the expenditure of $214,479.37 for the reimplementation and refresh of the Seal Beach Parking ALPR system, CIP BG2401; and, 2.

Authorizing the Interim City Manager to execute on behalf of the City all contracts and proposals, including any necessary extensions or amendments thereafter.

ITEMS REMOVED FROM THE CONSENT CALENDAR

PUBLIC HEARING
UNFINISHED / CONTINUED BUSINESS – None
NEW BUSINESS – None

ADJOURNMENT
Adjourn the City Council in memory of Volunteers in Police Services (VIPs) Ron Alsop Cardon and Laurel Mauk to Monday, March 10, 2025 at 5:30 p.m. to meet in closed session, if deemed necessary.

21 Citizens of the
Year.
More than $500,000
in scholarships &
emergency
assistance given to
students.

Thank you for supporting Cypress College students,
Seal Beach honorees, and the Americana Awards Gala

Seal Beach Police Department
ALPR Parking Technology Refresh
City Council Meeting
February 24, 2025
Background
• Mobile Automated License Plate Recognition (ALPR) has been utilized in Seal Beach since the initiation of the smart parking technology program in 2017 and (besides our people)is the central pillar that our parking enforcement and animal control programs are built upon
• In 2019, the City was recognized for the innovative use of integrated parking technology (first end-to-end parking technology solution on the West Coast)
• Throughout the City, parking is based on the license plate which optimizes the program and provides a more efficient operation Background
• The current ALPR technology has exceeded the life cycle (impacting program effectiveness and reductions in parking revenue) • Budget allocation was authorized to proceed with an ALPR technology refresh for 6 vehicles
• SBPD has direct experience with the 2 integrated mobile LPR companies (Genetec & Motorola)
• Motorola failed to provide the support required by the City’s smart parking technology program
Why Genetec?
● Complex & customized nature of the associated Genetec equipment and software
○ Able to optimize existing infrastructure and integrations with continuity and consistency with patrol & parking fleet vehicles ○ Simplifies maintenance and maximizes interoperability ● Switching vendors would require substantial increases to unnecessarily replace components and needlessly complicate reimplementation efforts (which would exceed budget allocation) Invitation to Bid
• 3 qualified, experienced and licensed Genetec distributors who support the West Coast region with municipal, parking and law enforcement experience were solicited on October 16, 2024 • The Invitation to Bid included a detailed scope of work, submission criteria and evaluation guidelines
• Each distributor completed an onsite inspection of the existing infrastructure with Police Department staff the week of November 5, 2024
• Proposals were received from each distributor on November 26, 2024.

Vendor Selection
• Proposals were received from Route 1 (incumbent), Eye P Solutions and ComSonics
• After thorough review of the proposals received, Route 1 and ComSonics were shortlisted and references were contacted • Existing concerns about responsiveness and consistency with Route 1 were confirmed by other agencies
• ComSonics has provided the most cost-effective and complete proposal to the City that includes support and overall coverage Financial & Service Impact
Impact to current revenue
• In 2023, our operations resulted in approximately 22,900 citations. SCSOs PAs handled over 6,000 service calls. However, ongoing equipment failures are significantly hampering the effectiveness of SCSOs and PAs. This decrease in efficiency is expected to worsen as equipment issues persist. • We anticipate several negative outcomes if immediate action is not taken:

1. A substantial decline in parking revenue

2. Increased response times for service calls

3. SCSO and PO safety issues

4. Significant disruptions to Animal Control and Jail services Budget Allocation
• The approved budget allocation for this project was $242,608 • ComSonics proposal is approximately $214,000
• Cost savings = Approximately $30,000 which can be invested in other aspects of the technology configuration
• Recurring costs, such as licensing fees, and routine management costs outside of the established warranty and agreements are to be budgeted for in the Police Department technology budget. • We recommend that a portion of the annual parking revenue be set aside in anticipation of preventative maintenance and the inevitable technology updates and upgrades that will be required in the future.

Questions?
[email protected]

City of Seal Beach
AU-C 260 Communication With Those Charge With Governance For the Year Ended June 30, 2024
Presented by:

Frances Kuo, CPA, CGMA
Engagement Partner
2 CONTENTS
• Required Communications (AU-C 260)
• Overview of Financial Statements
• Key Pension and OPEB Information
• Audit Results
2/24/2025
3 Required Communications (AU-C 260)
2/24/2025
4 • Our Responsibility in Accordance with Professional Standards 2/24/2025
Required Communications (AU-C 260)
• Form and express an opinion about whether the financial statements that have been prepared by management with your oversight are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America
• Plan and perform the audit to obtain “reasonable” assurance (not “absolute” assurance) about whether the financial statements are free of material misstatements • Consider internal control over financial reporting. Such considerations are solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control
• Conclude there are no conditions or events that raise substantial doubt about the City’s ability to continue as a going concern.
• Communicate with those charged with governance
5 Required Communications (AU-C 260)
• Ethics and Independence
• Complied with ALL relevant ethical requirements regarding independence • Significant Accounting Policies
• The City of Seal Beach disclosed all significant accounting policies in Note 1 to the financial statements.
• Implementation of GASB 100 - Accounting Changes and Error Corrections – an Amendment of GASB Statement No. 62
• Significant Estimates
• Investment Fair Value
• Depreciation and amortization on Capital Assets
• Net Pension Liability
• Net OPEB Liability
2/24/2025
6 Required Communications (AU-C 260)
• Sensitive Disclosures
• Note 1 – Summary of Significant Accounting Policies
• Note 9 – Defined Benefit Pension Plans
• Note 10 – Other Postemployment Benefits (“OPEB”) Plan • Note 14 – Individual Fund Disclosure
• Note 15 – Prior Period Adjustments
• Misstatements
• No material uncorrected misstatement
2/24/2025
7 Required Communications (AU-C 260)
• Consultation with Other Accountants
• Management informed us that, and to our knowledge, there were no consultations with other accountants regarding auditing and other matters. • Significant Difficulties
• We encountered no significant difficulties in dealing with management. • Disagreement with Management
• We did not have any disagreement with management in terms of accounting treatments nor audit procedures performed.
2/24/2025
8 OVERVIEW OF THE FINANCIAL

STATEMENTS
2/24/2025
9 City of Seal Beach
Government-Wide Summary
As of June 30, 2024 and 2023
2023
2024 3028 (as restated) 3028 Change
Net Position:

Governmental-Activities $ 100,459,000 $ 95,310,000 $ 5,149,000 Business-type Activities 43,533,000 44,901,000 (1,368,000) Total Net Position 143,992,000 140,211,000 3,781,000 2/24/2025 10 City of Seal Beach
Government-Wide Summary (Continued)
For the Year Ended June 30, 2024
Governmental
Activities
Business-Type
Activities Total
Program Expenses $ 49,498,000 $ 10,481,000 $ 59,979,000 Program Revenues 13,499,000 8,712,000 22,211,000
Net Cost of Services (35,999,000) (1,769,000) (37,768,000) General Revenues 41,148,000 401,000 41,549,000
Change in Net Position $ 5,149,000 $ (1,368,000) $ 3,781,000 2/24/2025
11 City of Seal Beach
General Fund Summary
For the Year Ended June 30, 2024
Revenue $ 50,338,000
Expenditures 44,151,000
Revenue over Expenditures 6,187,000
Net Transfers (4,305,000)
Net Change in Fund Balance 1,882,000
Fund Balance at July 1, 2023, as restated 37,587,000
Fund Balance at June 30, 2024 $ 39,469,000
2/24/2025
12 City of Seal Beach
CalPERS Pension Plan
Misc Safety Total 2023
Total Pension Liability $ 57,305,000 $ 108,684,000 $ 165,989,000 $ 159,733,000 Fiduciary Net Position 39,480,000 74,040,000 113,520,000 110,428,000 Net Pension Liability $ 17,825,000 $ 34,644,000 $ 52,469,000 $ 49,305,000 Funding Ratio 68.89% 68.12% 68.39% 69.13%
Contribution Made $ 1,782,000 $ 4,296,000 $ 6,078,000 $ 5,647,000 2024
2/24/2025
13 City of Seal Beach
Other Postemployment Benefits (“OPEB”)
2/24/2025
2024 2023
Total OPEB Liability $ 11,553,000 $ 13,421,000
Fiduciary Net Position 7,834,000 7,130,000
Net OPEB Liability $ 3,719,000 $ 6,291,000
Funding Ratio 67.81% 53.13%
Contribution Made $ 965,000 $ 981,000
14 AUDIT RESULTS
2/24/2025
15 Audit Results
• Financial Statements
• Unmodified opinion
• Financial Statements are fairly presented in all material respects • Significant accounting policies have been consistently applied • Estimates are reasonable
• Disclosures are properly reflected in the financial statements • AU-C 265, Communicating Internal Control Related Matters Identified in an Audit
• None Reported
2/24/2025

HQ - ORANGE COUNTY
200 E. Sandpointe Avenue
Suite 600
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BAY AREA
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LAS VEGAS
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PHOENIX
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HQ - ORANGE COUNTY
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Suite 600
Santa Ana, CA 92707

SAN DIEGO
4660 La Jolla Village Drive
Suite 100
San Diego, CA 92122

SACRAMENTO
1511 Corporate Way
Suite 220
Sacramento, CA 95831

LAS VEGAS
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Suite 300
Las Vegas, NV 89134

PHOENIX
2 N. Central Avenue
Suite 1800
Phoenix, AZ 85004

WALNUT CREEK
2121 North California Boulevard
Suite 290
Walnut Creek, CA 94596
1 Gloria Harper
From: JO8N <[email protected]>
Sent: Sunday, February 23, 2025 1:54 PM
To: Ask City Hall; Human Resources; budget; [email protected]; Lisa Landau; Nathan Steele; Joe Kalmick; Ben Wong; Patty Senecal; Patrick Gallegos; Jill Ingram; [email protected]; Michael Henderson; Gloria Harper; Joe Bailey; Alexa Smittle; Barbara Arenado; Iris Lee; Tim Kelsey; Deb Machen; Shaun Temple; Brandon DeCriscio; Anthony Nguyen; Nicholas Nicholas; Mike Ezroj; Julia Clasby; Karen Pickering; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected] Subject: Application For City Attorney Of Seal Beach And Public Comment For 2/24/2025 Attachments: ESC8ATON C8RIST.pdf; FLESH OUT ESC8ATON C8RIST.pdf To Nick G. From Brea,
I Appreciate You Taking The Time To Write Me A Letter. I Have Been Seeking To "Agendize" This Topic Twice As Long As You Have Worked In Seal Beach. Read That Again. Since You Know All My Information, I Formally Request My June 2016 Seal Beach Police Report In Which I Decriminalized Possession Of Psychedelics In Seal Beach (SB 16 1427) To Be Presented To City Council As Supplementary Material To My Public Comment. I Am Just Trying To Love My Neighbor As Myself. I Was Not Intimidating Anyone Or Disrupting Anything, Only Emphasizing The De Facto Law Vs. The De Jure Law. I Simply Wanted To Respond To Mike's Answer To Lisa Which Was Not "Plainly Correct" As There Are Numerous Cities In California That Have Decriminalized Psilocybin Mushrooms For Years Now, But Both Of You Have Chosen To Lie By Omission On Separate Occasions. Do You Believe You Have Told The Whole Truth When Speaking On The Legality Of Psilocybin Mushrooms In California? I Am Allowed To Make Gestures And Clap My Hands As I Do (And Everyone Does) In Every City Council Meeting.

Your Letter Fails To Cite The Requested Specific City Law That Determines Where The Public May Stand. There Are No Clear Markings Determining Where "The Well" Is, And The Black Metal Bar Is For People With Disabilities. I Refused Mike's Order To Back Away Because I Did Not Know If That Was A Lawful Order, And I Still Do Not Know If It Is Because Of Your Failure To Cite Sources In Your Letter. https://dictionary.cambridge.org/us/dictionary/english/daylighting Anytime Psychedelics Are Spoken About In A Seal Beach City Council, I Believe I Deserve A Chance To Speak As A Witness As I Have The Experience. In Addition, I Am Using Meta-communication In Order To "Agendize" The Process By Which We "Agendize", So Actually, I Am On Topic In A Discussion Of The "Agenda" Whenever I Give My Public Comment. Failing To "Agendize" Topics Deemed "Not Within The Subject Matter Jurisdiction Of The City Council" May Be "Commonplace", But Is It Not "Fair" To The Community Residents And Workers That Seek Help Mentally, Emotionally, And Spiritually. Many That May Seek Help Are Veterans, First Responders, Elderly, Disabled, Suicidal, Depressed, Traumatized, Addicted, Faithless, Etc. That Have Uncomfortable Truths And Struggles.

Do You Respect My First Amendment Right To Practice My Faith By Eating The Flesh And Blood Of Jesus Christ According To The Religious Freedom Restoration Act (RFRA) (1993) And Gonzales v. O Centro Espirita Beneficente Uniao do Vegetal (2006)? If So, Can I Get That In Writing? If You Have To Lose In A Trial Attempting To Prosecute Me, So Be It. I Have More Than Enough Evidence To Defend Myself.

The City Asks, For "I Have Food To Eat That You Know Nothing About." (John 4:32) Language was not simply a tool for survival; it was born from the sacred paradox of violence and revelation.

Anthropologist René Girard's theory of mimetic violence suggests that human culture originates in cycles of conflict, resolved through the scapegoating mechanism, in which a victim is collectively sacrificed to restore social order (Girard, Violence and the Sacred, 1972). The connection between violence and sacred revelation is also present in Walter Burkert's Homo Necans (1983), where he argues that ritual sacrifice played a crucial role in the emergence of human social structures and symbolic thought.

The scapegoat, who ingested the psilocybin mushroom and sang/danced as they were murdered, became the first shaman and the first speaker of human language. Ethnobotanist Terence McKenna proposed in Food of the Gods (1992) that psilocybin mushrooms played a pivotal role in the cognitive evolution of early humans, enhancing linguistic capabilities and spiritual experiences. Michael Harner, in The Way of the Shaman (1980), documents how shamans in indigenous cultures use psychoactive substances to enter altered states of consciousness, often involving ecstatic singing and dancing. Shamanic figures frequently occupied a liminal position in society, 2 sometimes revered and sometimes persecuted, paralleling the scapegoat archetype (Eliade, Shamanism: Archaic Techniques of Ecstasy, 1951).

Their song/dance in the throes of death were the first sacred utterances, giving birth to language as a divine technology. David Lewis-Williams, in The Mind in the Cave (2002), argues that early human symbolic thought— expressed through cave art, ritual, and possibly early language—originated in altered states of consciousness, often induced by shamanic experiences. The idea of language as a divine gift is also found in religious traditions, such as in Genesis 2:19, where Adam names the animals, signifying the sacred act of speech.

This language, rooted in violence, would evolve into the stories, rituals, and myths that shaped human culture's knowledge of good and evil. Mythographer Joseph Campbell describes in The Hero with a Thousand Faces (1949) how mythic narratives encode fundamental moral struggles, often rooted in sacrificial violence. The Genesis account of Cain and Abel (Genesis 4:1-16) exemplifies this connection between violence and the emergence of moral awareness. Girard further argues in Things Hidden Since the Foundation of the World (1978) that myths obscure the scapegoating mechanism, transforming acts of collective violence into foundational cultural narratives.

The ultimate revelation of language’s purpose, however, came with the death of Jesus Christ, who exposed the cycle of violence and offered humanity a path of love and transcendence to eternal life. Girard interprets the Gospels as a revolutionary text that demystifies the scapegoat mechanism, making Jesus the innocent victim whose sacrifice unveils the violent foundations of human culture (I See Satan Fall Like Lightning, 1999). The crucifixion of Christ, narrated in the Gospels (e.g., Matthew 27, Mark 15, Luke 23, John 19), is the climax of this revelation, demonstrating both the injustice of scapegoating and the possibility of redemption beyond violence.

The words of Christ, spoken during his life and especially during his crucifixion, fulfill the original utterances of the scapegoat. Jesus' final words, particularly “Father, forgive them, for they know not what they do” (Luke 23:34), echo the function of the original sacrificial victim while subverting the cycle of violence through forgiveness. This radical shift fulfills the prophetic tradition, as seen in Isaiah 53:7, which describes the suffering servant who is “led like a lamb to the slaughter” but does not retaliate.

The Gospel of John affirms this in the Logos doctrine (John 1:1-14), where language (the Word) is presented not merely as a human invention but as the divine principle of creation and reconciliation. Girard (1999) and theologian James Alison (The Joy of Being Wrong, 1998) argue that Christ’s revelation permanently alters humanity’s relationship with violence, offering an alternative founded on love and forgiveness. παράκλητος - Paraklétos (John 15:26)
Advocate, Helper, Comforter, Counselor
The Term "Paraklétos" Is Used In The New Testament To Describe Someone Who Is Called To Aid, Support, Or Intercede On Behalf Of Another. In A Legal Context, It Refers To An Advocate Or Legal Assistant. In A Broader Sense, It Signifies A Helper Or Comforter Who Provides Encouragement And Support. In The New Testament, "Paraklétos" Is Primarily Used To Describe The Holy Spirit, who acts as a divine helper and guide for believers.

Derived From The Greek Verb παρακαλέω (Parakaleó), Meaning "To Call To One's Side," "To Summon," Or "To Comfort."
One Way - Guess You Didn't Know
https://www.youtube.com/watch?v=3gPOLj07EXU
The Main Ingredient - Let Me Prove My Love to You
https://www.youtube.com/watch?v=SyQPpF15hFk
Earth, Wind & Fire - I'll Write a Song for You
https://www.youtube.com/watch?v=6bMC5lGLlAA
Move 78 - Pearls Before Swine
https://www.youtube.com/watch?v=T3texRp4Pj0
Them Two - Am I A Good Man
https://www.youtube.com/watch?v=7EUipDulX8c
DeBarge - A Dream
https://www.youtube.com/watch?v=-dsCxATYMYk
Monophonics - It's Only Us
https://www.youtube.com/watch?v=iUOYT2L_eRo
Taylor McFerrin - As You Are
https://www.youtube.com/watch?v=SMjVoRkOBVI
⭼⭽⭾⭿⮀⮁⮂
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JO8N
1 Gloria Harper
From: Gloria Harper
Sent: Monday, February 24, 2025 4:50 PM
To: Executive Team; Nicholas Ghirelli
Cc: Brandon DeCriscio
Subject: Item H - Raftelis Financial Consultants PSA
BCC: Council Members
Good afternoon,
Item H has been pulled from the February 24, 2025, City Council agenda and will not be considered at tonight’s meeting. This item will be agendized for a future meeting, with the date to be determined.

Item H - Approving and Authorizing Amendment 2 to the Professional Services Agreement with Raftelis Financial Consultants, Inc. for Water and Wastewater Financial Planning Services - That the City Council adopt Resolution 7620: 1. Approving Amendment 2 to the Professional Services Agreement with Raftelis Financial Consultants, Inc. dated June 12, 2023, as previously amended by Amendment 1 dated March 25, 2024, to provide additional Water and Wastewater Financial Planning Services; increase compensation for such additional services by $51,527 for a revised total contract not-to-exceed amount of $187,294; and extend the term to December 31, 2025; and,2. Authorizing and directing the Interim City Manager to execute Amendment 2 on behalf of the City; and, 3. Authorizing the Interim City Manager to approve unforeseen additional work requests, up to the total not-to-exceed amount of $10,000.

Thank you,
Gloria D. Harper
Gloria D. Harper, City Clerk
211 Eighth Street, Seal Beach, CA 90740
(562) 431-2527 x 1305
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Seal Beach follows Civility Principles by promoting courtesy, respectful listening, open mindedness, issue-focused debate, and embracing respectful disagreement and dissent as democratic rights and tools for sound decisions. For Information about Seal Beach, please see our City website: www.sealbeachca.gov NOTICE: This communication may contain privileged or other confidential information. If you are not the intended recipient of this communication, or an employee or agent responsible for delivering this communication to the intended recipient, please advise the sender by reply email and immediately delete the message and any attachments without copying or disclosing the contents. Thank you.

Agenda Item A

AGENDA STAFF REPORT
DATE: February 24, 2025
TO: Honorable Mayor and City Council
THRU: Patrick Gallegos, Interim City Manager
FROM: Gloria D. Harper, City Clerk
SUBJECT: Approval of the City Council Minutes
________________________________________________________________ SUMMARY OF REQUEST:

That the City Council approve the minutes of the Closed Session and Regular City Council meetings held on February 10, 2025.

BACKGROUND AND ANALYSIS:

This section does not apply.

ENVIRONMENTAL IMPACT:

There is no environmental impact related to this item.

LEGAL ANALYSIS:

No legal analysis is required for this item.

FINANCIAL IMPACT:

There is no financial impact for this item.

STRATEGIC PLAN:

This item is not applicable to the Strategic Plan.

RECOMMENDATION:

That the City Council approve the minutes of the Closed Session and Regular City Council meetings held on February 10, 2025.

Page 2 ends

SUBMITTED BY: NOTED AND APPROVED:

Gloria D. Harper Patrick Gallegos
Gloria D. Harper, City Clerk Patrick Gallegos, Interim City Manager Prepared by: Brandon DeCriscio, Deputy City Clerk
ATTACHMENTS:

A. Minutes – Closed Session, February 10, 2025
B. Minutes – Regular Session, February 10, 2025
Seal Beach, California
February 10, 2025
The City Council met in Closed Session at 6:03 p.m. in the City Hall Conference Room.

ROLL CALL

Present: Mayor Landau
Council Members: Kalmick, Wong, Senecal, Steele

Absent: None
City Staff: Nicholas Ghirelli, City Attorney
Patrick Gallegos, Interim City Manager
Gloria D. Harper, City Clerk
Barbara Arenado, Director of Finance/ City Treasurer

ORAL COMMUNICATIONS
Mayor Landau opened oral communications. Speakers: None. Mayor Landau closed oral communications.

CLOSED SESSION
A. CONFERENCE WITH LABOR NEGOTIATOR Government Code §54957.6 City Negotiator(s): Interim City Manager Patrick Gallegos Employee Organization(s):

Seal Beach Supervisors & Professionals Association
Mid-Management and Confidential Employees Association
Orange County Employees Association

ADJOURNMENT
Mayor Landau adjourned the Closed Session meeting at 6:57 p.m.

Gloria D. Harper, City Clerk
City of Seal Beach
Approved:

Lisa Landau, Mayor
Attested:

Gloria D. Harper, City Clerk
Seal Beach, California
February 10, 2025
The City Council met in Regular Session at 7:04 p.m. in the City Council Chamber.

Council Member Wong led the Pledge of Allegiance.

ROLL CALL

Present: Mayor Landau
Council Members: Kalmick, Wong, Senecal, Steele

Absent: None
City Staff: Nicholas Ghirelli, City Attorney
Patrick Gallegos, Interim City Manager
Michael Henderson, Police Chief
Barbara Arenado, Director of Finance/City Treasurer
Iris Lee, Director of Public Works
Joe Bailey, Marine Safety Chief
Gloria D. Harper, City Clerk
Nick Nicholas, Police Captain
Mike Ezroj, Police Captain
Tim Kelsey, Recreation Manager

PRESENTATIONS / RECOGNITIONS
• Trauma Intervention Program (TIP) 30th Anniversary Proclamation • National Black History Month Proclamation

ORAL COMMUNICATIONS
Mayor Landau opened oral communications. Speakers: Glen Rogers, John Janecek, Jo8n, Jan Arboit, and Mari Cobb addressed the City Council. Mayor Landau closed oral communications.

One (1) supplemental communication was received after posting the agenda; it was distributed to the City Council and made available to the public.

APPROVAL OF AGENDA & WAIVER OF FULL READING OF RESOLUTIONS AND

ORDINANCES
Mayor Landau pulled Item G for separate consideration.

Council Member Senecal moved, second by Council Member Steele to approve the agenda.

AYES: Kalmick, Wong, Landau, Senecal, Steele
NOES: None
ABSENT: None
ABSTAIN: None
Motion carried

CITY ATTORNEY REPORT
City Attorney Ghirelli reported that the City Council met in Closed Session to discuss the one (1) item posted on the agenda. All five (5) Council Members were present, and no reportable action was taken.

CITY MANAGER REPORT
Interim City Manager Gallegos announced that the city, in partnership with American Association of Retired Persons (AARP) will be offering senior tax assistance services through April 14, 2025. Additionally, Interim City Manager Gallegos announced that mild to heavy rainfall is expected throughout the week. He noted that sandbags are available throughout the city and that additional information on rain preparation can be found on the city’s website. Finally, Interim City Manager Gallegos announced that City Hall will be closed on Monday, February 17, 2025, in observance of President’s Day.

COUNCIL COMMENTS
Council Member Wong reported his attendance at the College Park West Los Angeles Department of Water and Power (LADWP) Haynes Generating Station Recycled Water Pipeline Project meeting and the League of California Cities New Council Member Academy. Additionally, he reported his attendance at a meeting with the auditors at City Hall, regarding the 2023-2024 Financial Report. Lastly, he reported that he toured the Republic Services Facility in Huntington Beach.

Council Member Kalmick reported his attendance at the San Gabriel River Working Group meeting, the Marine Safety Badge Pinning Ceremony, the Orange County Fire Authority (OCFA) Human Resources Committee, the Southern California Association of Governments (SCAG) Joint Committee Forum, and the Los Cerritos Wetlands Authority meeting.

Additionally, Council Member Kalmick announced that on Saturday, March 15, 2025, OCFA will host an Open House at the OCFA Headquarters in Irvine.

Lastly, Council Member Kalmick announced that on March 22, 2025, the Los Cerritos Wetlands Authority will host an outreach workshop at 1st Street and Pacific Coast Highway regarding the upcoming restoration of the City’s portion of the Los Cerritos Wetlands.

Council Member Senecal reported her attendance at the Chamber of Commerce meeting, the Los Angeles Department of Water and Power (LADWP) Haynes Generating Station Recycled Water Pipeline Project Community meeting, the League of California Cities New Council Member Academy, the Southern California Association of Governments (SCAG) Joint Committee forum, the Orange County Council of Governments meeting, and a meet and greet with Joint Forces Training Base Lieutenant Colonel Fox.

Additionally, Council Member Senecal announced that there are vacancies to represent District 4 on the Environmental Quality Control Board (EQCB) and the Recreation and Parks Commission. She encouraged residents to reach out to her for more information.

Finally, she announced that the Citizen Council Stormwater Advisory Ad Hoc Committee meeting is scheduled for Wednesday, February 26, 2025 at 5:30 p.m. in the City Council Chambers.

Mayor Pro Tem Steele reported that he met with the auditors at City Hall regarding the City’s Financial Report. He also reported his attendance at the Los Angeles Department of Water and Power (LADWP) Haynes Generating Station Recycled Water Pipeline Project Community meeting, the Golden Rain Foundation Board meeting, and the Orange County Mosquito and Vector Control meeting. Lastly, Mayor Pro Tem Steele reported he took a ride along with the Seal Beach representative from Orange County Mosquito and Vector Control.

Mayor Landau addressed public comments and called upon Police Chief Henderson to discuss the parking citations appeal process and the Local Hazard Mitigation Plan. She also inquired about the City’s position on legalizing psilocybin mushrooms.

Community Development Director Smittle announced that the Environmental Quality Control Board will meet on Wednesday, February 19, 2025 at 6:15 p.m. to discuss the Local Hazard Mitigation Plan.

COUNCIL ITEMS
There were no council items.

CONSENT CALENDAR
A. Approval of the City Council Minutes - That the City Council approve the minutes of the Closed Session and Regular City Council meetings held on January 27, 2025.

B. Demand on City Treasury (Fiscal Year 2025) - Ratification.

C. Mary Wilson Library Lease Agreement Between the City of Seal Beach and the County of Orange - That the City Council adopt Resolution 7611: 1. Approving a lease agreement for the Mary Wilson Library between the City of Seal Beach and the County of Orange; and, 2. Directing the Interim City Manager to execute the lease agreement on behalf of the City.

D. Approving and Authorizing Amendment 1 to the Professional Services Agreement with NV5, Inc. for On-call Professional Inspection Services - That the City Council adopt Resolution 7612: 1. Approving Amendment 1 to the Professional Services Agreement dated March 13, 2023, with NV5, Inc., increasing the second year compensation for on-call inspection services by $100,000 for a total revised contract amount of $1,540,000; and, 2. Authorizing and directing the Interim City Manager to execute Amendment 1 to the Professional Services Agreement on behalf of the City.

E. Approving Budget Amendment BA #25-08-01 for the Drainage Closed Circuit Television Inspection and Maintenance - That the City Council adopt Resolution 7613 approving Budget Amendment BA #25-08-01 for Drainage Closed Circuit Television Inspection and Maintenance.

F. Approving the Emergency Purchase of Two Personal Watercraft - That the City Council adopt Resolution 7614: 1. Approving the emergency purchase of two (2) Personal Watercraft for the Marine Safety Department, in response to the critical failure of current units and the ongoing need for reliable lifesaving equipment; and,

2. Authorizing the Interim City Manager to execute an emergency purchase agreement with Del Amo Motorsports in the amount of $35,958.

G. Amendment to the Cost Recovery Schedule to Add Penalty Amount for NonCompliance with California Vehicle Code Daylighting Parking Requirements - That the City Council adopt Resolution 7615 amending the City of Seal Beach Cost Recovery Schedule to include a penalty fee of $56 for violations of California Vehicle Code (CVC) Section 22500(n)(1)(A), known as the "Daylighting" regulation, prohibiting parking within 20 feet of the approach side of any crosswalk, or within 15 feet of crosswalks with curb extensions.

H. Approving a Retroactive Payment and Increasing the Contingency Fund to the Telecommunications Services Agreement between the City of Seal Beach and GoTo Communications, Inc - That the City Council adopt Resolution 7616: 1.

Approving the retroactive payment of $3,620.13 to GoTo Communications, Inc. for additional telecommunications services for the initial one-year term (Original Term); and, 2. Approving an increase in the contingency funds to $12,000 per one-year extension for the Telecommunications Services Agreement with GoTo Communications, Inc. for a total not to exceed amount of $41,220.96 for the Original Term and four (4) one-year extensions; and, 3. Authorizing and directing the Interim City Manager to approve and execute any necessary supporting documents on behalf of the City to implement the Resolution.

Council Member Kalmick moved, second by Mayor Pro Tem Steele to approve the recommended actions on the consent calendar.

The vote below is for the Consent Calendar Items with the exception of Item G.

AYES: Kalmick, Wong, Senecal, Steele, Landau
NOES: None
ABSENT: None
ABSTAIN: None
Motion carried

ITEMS REMOVED FROM THE CONSENT CALENDAR
G. Amendment to the Cost Recovery Schedule to Add Penalty Amount for NonCompliance with California Vehicle Code Daylighting Parking Requirements - That the City Council adopt Resolution 7615 amending the City of Seal Beach Cost Recovery Schedule to include a penalty fee of $56 for violations of California Vehicle Code (CVC) Section 22500(n)(1)(A), known as the "Daylighting" regulation, prohibiting parking within 20 feet of the approach side of any crosswalk, or within 15 feet of crosswalks with curb extensions.

Interim City Manager Gallegos called upon Police Chief Henderson, who introduced Police Captain Nicholas, to provide an overview of the staff report Police Captain Nicholas provided an in-depth overview of the staff report. A discussion ensued between Captain Nicholas, the City Council, Public Works Director Lee, City Attorney Ghirelli, and Police Chief Henderson.

Mayor Pro Tem Steele moved, second by Council Member Kalmick to adopt Resolution 7615 amending the City of Seal Beach Cost Recovery Schedule to include a penalty fee of $56 for violations of California Vehicle Code (CVC) Section 22500(n)(1)(A), known as the "Daylighting" regulation, prohibiting parking within 20 feet of the approach side of any crosswalk, or within 15 feet of crosswalks with curb extensions.

AYES: Kalmick, Wong, Senecal, Steele, Landau
NOES: None
ABSENT: None
ABSTAIN: None
Motion carried

PUBLIC HEARING
There were no public hearing items.

UNFINISHED/CONTINUED BUSINESS
There were no unfinished/continued business items.

NEW BUSINESS
There were no new business items.

ADJOURNMENT
Mayor Landau adjourned the City Council at 8:39 p.m. to Monday, February 24, 2025, to meet in Closed Session at 5:30 p.m., if deemed necessary. __________________________
Gloria D. Harper, City Clerk
City of Seal Beach
Approved: ___________________________
Lisa Landau, Mayor
Attested: ____________________________
Gloria D. Harper, City Clerk

Agenda Item D

AGENDA STAFF REPORT
DATE: February 24, 2025
TO: Honorable Mayor and City Council
THRU: Patrick Gallegos, Interim City Manager
FROM: Barbara Arenado, Director of Finance/Treasurer
SUBJECT: City of Seal Beach Annual Audit Reports for Fiscal Year Ending June 30, 2024
________________________________________________________________ SUMMARY OF REQUEST:

That the City Council receive and file the following documents for the Fiscal Year ending June 30, 2024:

A. Audit Communication Letter
B. Report on Internal Control
C. 2024 Annual Comprehensive Financial Report
D. Appropriations Limit Final Report
BACKGROUND AND ANALYSIS:

The audit firm, The Pun Group Accountants & Advisors (Pun Group), has completed the annual audit of the City for the Fiscal Year (FY) ending June 30, 2024. The audit was conducted in accordance with generally accepted auditing standards and included examining, on a test basis, evidence supporting the amounts and disclosures to obtain reasonable assurance that the financial statements are free of material misstatements.

In the opinion of the auditors, the financial statements fairly present, in all material respects, the financial position of the City on June 30, 2024. The 2024 Annual Comprehensive Financial Report (ACFR) is included as Attachment C for information and use. The ACFR will be submitted to the Government Finance Officers Association to be considered for the Certificate of Achievement for Excellence in Financial Reporting. The City has won the award for 22 consecutive years.

The purpose of the Audit Communication Letter (Attachment A) is to provide a mechanism for communication with the governing body, highlighting significant issues that may arise during the audit process. As indicated, the City’s financial statements were clearly presented.

Page 2 ends

The purpose of the Report on Internal Control (Attachment B) is to help the auditor in designing audit procedures for the purpose of expressing an opinion on the financial statements.

The purpose of the Appropriations Limit Final Report (Attachment D) is to attest the calculation was performed using the correct methodology and was correctly calculated based upon the information provided.

On February 3, 2024, Frances Kuo, from the Pun Group, gave a presentation to the City Council Audit Committee, and the item was thoroughly reviewed and discussed. Among the attendees were Interim City Manager Gallegos, Finance Director Arenado, Finance Manager Hoang, Frances Kuo from the Pun Group, Mayor Pro Tem Steele, and Council Member Wong.

ENVIRONMENTAL IMPACT:

This action is exempt from the California Environmental Quality Act, because it is not defined as a “project” under CEQA.

LEGAL ANALYSIS:

No legal analysis is required for this item.

FINANCIAL IMPACT:

There is no financial impact for this item.

STRATEGIC PLAN:

This item is not applicable to the Strategic Plan.

RECOMMENDATION:

That the City Council receive and file the following documents for the Fiscal Year ending June 30, 2024:

A. Audit Communication Letter
B. Report on Internal Control
C. 2024 Annual Comprehensive Financial Report
D. Appropriations Limit Final Report

Page 3 ends

SUBMITTED BY: NOTED AND APPROVED:

Barbara Arenado Patrick Gallegos
Barbara Arenado, Director of Finance/
Treasurer
Patrick Gallegos, Interim City Manager
ATTACHMENTS:

A. Audit Communication Letter
B. Report on Internal Controls
C. 2024 Annual Comprehensive Financial Report
D. Appropriations Limit Final Report
200 E. Sandpointe Avenue, Suite 600
Santa Ana, California 92707
January 29, 2025
To the Honorable Mayor and Members of the City Council
of the City of Seal Beach
Seal Beach, California
We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Seal Beach (the “City”) for the year ended June 30, 2024.

Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards and Government Auditing Standards, as well as certain information related to the planned scope and timing of our audit. We have communicated such information in our letter to you dated May 24, 2024.

Professional standards also require that we communicate to you the following information related to our audit.

Significant Audit Findings
Qualitative Aspects of Accounting Practices
Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in Note 1 to the basic financial statements. As described in Note 1 to the financial statements, the City implemented GASB Statement No. 100 – Accounting Changes and Error Corrections – an Amendment of GASB Statement No. 62. No other new accounting policies were adopted and the application of existing policies was not changed during 2024. We noted no transactions entered into by the City during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period.

Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the City’s financial statements were:
 Management’s estimate of the investment fair market value is based on information provided by U.S. Bank, the custodial of the investments in the U.S. treasury securities, U.S. government sponsored enterprise securities, asset-backed securities, municipal bonds, corporate notes, negotiable certificates of deposit and bank notes based on institutional bond quotes and certificate of deposit pricing. We evaluated the key factors and assumptions used to develop the investment fair market value in determining that it is reasonable in relation to the financial statements taken as a whole.

To the Honorable Mayor and Members of the City Council
of the City of Seal Beach
Seal Beach, California

Page 2 ends

 Management’s estimate of the depreciation and amortization on capital assets is based on the industry standard and past experience on actual useful life of the asset groups. We evaluated the key factors and assumptions used to develop the depreciation on capital assets in determining that it is reasonable in relation to the financial statements taken as a whole.  Management’s estimate of the net other postemployment benefits (“OPEB”) liability is based on the actuarial valuation on total OPEB liability and financial statements on fiduciary net position. We evaluated the key factors and assumptions used to develop the OPEB liability in determining that it is reasonable in relation to the financial statements taken as a whole.  Management’s estimate of the net pension liabilities is based on the actuarial valuation on proportionate share of total pension liability and based on audited financial statements on fiduciary net position for CalPERS plans. We evaluated the key factors and assumptions used to develop the net pension liability in determining that it is reasonable in relation to the financial statements taken as a whole.

Certain financial statement disclosures are particularly sensitive because of their significance to financial statement users. The most sensitive disclosures affecting the financial statements were:
 Note 1 – Summary of Significant Accounting Policies
 Note 9 – Defined Benefit Pension Plans
 Note 10 – Other Postemployment Benefits (“OPEB”) Plan  Note 14 – Individual Fund Disclosure
 Note 15 – Prior Period Adjustments
The financial statement disclosures are neutral, consistent, and clear.

Difficulties Encountered in Performing the Audit
We encountered no significant difficulties in dealing with management in performing and completing our audit.

Corrected and Uncorrected Misstatements
Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are clearly trivial, and communicate them to the appropriate level of management. Management has corrected all such misstatements. In addition, none of the misstatements detected as a result of audit procedures and corrected by management were material, either individually or in the aggregate, to each opinion unit’s financial statements taken as a whole.

Disagreements with Management
For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditors’ report.

We are pleased to report that no such disagreements arose during the course of our audit.

Management Representations
We have requested certain representations from management that are included in the management representation letter dated January 29, 2025.

To the Honorable Mayor and Members of the City Council
of the City of Seal Beach
Seal Beach, California

Page 3 ends

Management Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation involves application of an accounting principle to City’s financial statements or a determination of the type of auditors’ opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants.

Other Audit Findings or Issues
We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the City’s auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention.

Other Matters
We applied certain limited procedures to the Management’s Discussion and Analysis (“MD&A”), the Budgetary Comparison Schedules, the Schedule of the City’s Proportionate Share of the Net Pension Liability and Related Ratios, the Schedule of the Contributions – Pensions, the Schedule of Changes in Net Other Postemployment Benefits Liability and Related Ratios, and the Schedule of Contributions – Other Postemployment Benefits, which are required supplementary information (the “RSI”) that supplement the basic financial statements. Our procedures consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI.

We were engaged to report on the Combining and Individual Fund Financial Statements, which accompany the financial statements but are not RSI. With respect to this supplementary information, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves.

We were not engaged to report on the Introductory and the Statistical Sections, which accompany the financial statements but are not RSI. Such information has not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on it.

Restriction on Use
This information is intended solely for the information and use of the City Council and management of the City and is not intended to be, and should not be, used by anyone other than these specified parties.

Very truly yours,
Santa Ana, California
200 E. Sandpointe Avenue, Suite 600
Santa Ana, California 92707

REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND

ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS

PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Independent Auditors’ Report
To the Honorable Mayor and Members of the City Council
of the City of Seal Beach
Seal Beach, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States (“Government Auditing Standards”), the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Seal Beach, California (the “City”) as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the City's basic financial statements, and have issued our report thereon dated January 29, 2025.

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

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that were not identified.

To the Honorable Mayor and Members of the City Council
of the City of Seal Beach
Seal Beach, California

Page 2 ends

Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

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

Santa Ana, California
January 29, 2025

CITY OF

SEAL BEACH SEAL BEACH SEAL BEACH

CALIFORNIA
A"//6"-$0.13&)&/4*7&
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FISCAL YEAR 2023 - 2024

City of Seal Beach
Annual Comprehensive Financial Report
For the Year Ended June 30, 2024
Prepared by the Finance Department
Barbara Arenado
Director of Finance/City Treasurer

City of Seal Beach
Annual Comprehensive Financial Report
For the Year Ended June 30, 2024
Table of Contents
Page

INTRODUCTORY SECTION (UNAUDITED)
Letter of Transmittal ................................................................................................................................................... i Certificate of Achievement for Excellence in Financial Reporting – Government Finance Officers Association .......................................................................................................... v Organizational Chart ................................................................................................................................................. vi Principal Officials of the City of Seal Beach ........................................................................................................... vii

FINANCIAL SECTION
Independent Auditors’ Report on the Audit of the Financial Statements ................................................................. 1 Management’s Discussion and Analysis (Required Supplementary Information) (Unaudited) ............................. 5 Basic Financial Statements:

Government–Wide Financial Statements:

Statement of Net Position .................................................................................................................................. 16 Statement of Activities ...................................................................................................................................... 18 Fund Financial Statements:

Governmental Fund Financial Statements:

Balance Sheet .............................................................................................................................................. 25 Reconciliation of the Governmental Funds Balance Sheet
to the Government–Wide Statement of Net Position ........................................................................... 26 Statement of Revenues, Expenditures,
and Changes in Fund Balances ............................................................................................................. 27 Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Government–Wide Statement of Activities ......................................................................................................................... 28 Proprietary Fund Financial Statements:

Statement of Net Position ........................................................................................................................... 30 Statement of Revenues, Expenses, and Changes in Net Position ............................................................... 33 Statement of Cash Flows ............................................................................................................................. 34 Fiduciary Fund Financial Statements:

Statement of Fiduciary Net Position ........................................................................................................... 39 Statement of Change in Fiduciary Net Position .......................................................................................... 40 Index to the Notes to the Basic Financial Statements ......................................................................................... 43 Notes to the Basic Financial Statements ............................................................................................................... 45 City of Seal Beach
Annual Comprehensive Financial Report
For the Year Ended June 30, 2024
Table of Contents (Continued)
Page
FINANCIAL SECTION (Continued)
Required Supplementary Information (Unaudited):

Budgetary Comparison Schedule – General Fund .......................................................................................................... 89 Budgetary Comparison Schedule – Citywide Grants Special Revenue Fund ................................................................ 90 Notes to the Budgetary Comparison Schedule ............................................................................................................... 91 Schedule of the City's Proportionate Share of the Net Pension Liability and Related Ratios ........................................ 92 Schedule of Contributions – Pensions ............................................................................................................................ 94 Schedule of Changes in Net Other Postemployment Benefits Liability and Related Ratios .......................................... 96 Schedule of Contributions – Other Postemployment Benefits ....................................................................................... 98 Supplementary Information:

Schedule of Revenues, Expenditures, and Change in Fund Balance – Budget and Actual Capital Projects and Equipment Capital Projects Fund ................................................................................... 103 Nonmajor Governmental Funds:

Combining Balance Sheet ............................................................................................................................... 106 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances ....................................... 111 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual Street Lighting Special Revenue Fund ...................................................................................................... 116 Supplemental Law Enforcement Special Revenue Fund .......................................................................... 117 Police Asset Forfeiture Special Revenue Fund ......................................................................................... 118 Air Quality Improvement Special Revenue Fund ..................................................................................... 119 Park Improvement Special Revenue Fund ................................................................................................ 120 Traffic Impact Special Revenue Fund....................................................................................................... 121 State Gasoline Tax Special Revenue Fund ............................................................................................... 122 Measure M2 Special Revenue Fund ......................................................................................................... 123 Community Development Block Grant Special Revenue Fund ................................................................ 124 Police Grants Special Revenue Fund ........................................................................................................ 125 Landscape District Special Revenue Fund ................................................................................................ 126 Heron Pointe Special Revenue Fund ......................................................................................................... 127 Pacific Gateway Special Revenue Fund ................................................................................................... 128 Seal Beach Cable Special Revenue Fund ................................................................................................. 129 SB1 Special Revenue Fund ....................................................................................................................... 130 City Debt Service Fund ............................................................................................................................. 131

Internal Service Fund Financial Statements:

Combining Statement of Net Position ............................................................................................................. 135 Combining Statement of Revenues, Expenses, and Change in Net Position .................................................. 136 Combining Statement of Cash Flows .............................................................................................................. 137 Custodial Fund Financial Statements:

Combining Statement of Fiduciary Net Position ............................................................................................. 141 Combining Statement of Changes in Fiduciary Net Position .......................................................................... 142 City of Seal Beach
Annual Comprehensive Financial Report
For the Year Ended June 30, 2024
Table of Contents (Continued)
Page
STATISTICAL SECTION (Unaudited)
Net Position by Component .......................................................................................................................................... 146 Changes in Net Position ............................................................................................................................................... 148 Fund Balances of Governmental Funds ........................................................................................................................ 152 Changes in Fund Balances of Governmental Funds ..................................................................................................... 154 Assessed Value and Estimated Actual Value of Taxable Property .............................................................................. 156 Direct and Overlapping Property Tax Rates ................................................................................................................. 157 Principal Property Taxpayers ....................................................................................................................................... 158 Property Tax Levies and Collections ............................................................................................................................ 159 Ratios of Outstanding Debt by Type ............................................................................................................................ 160 Ratios of General Bonded Debt Outstanding ............................................................................................................... 162 Schedule of Direct and Overlapping Debt .................................................................................................................... 163 Legal Debt Margin Information.................................................................................................................................... 164 Pledged-Revenue Coverage .......................................................................................................................................... 166 Demographic and Economic Statistics ......................................................................................................................... 167 Top 25 Sales Tax Producers ......................................................................................................................................... 168 Full-Time and Part-Time City Employees by Function ............................................................................................... 169 Operating Indicators by Function ................................................................................................................................. 170 Capital Asset Statistics by Function ............................................................................................................................. 172 This page intentionally left blank.
i

January 29, 2025
Honorable Mayor, Members of the City Council and Citizens of the City of Seal Beach:

City of Seal Beach staff is pleased to submit for your information the Annual Comprehensive Financial Report (ACFR) of the City of Seal Beach (City) for the fiscal year ended June 30, 2024. Responsibility for both the accuracy of presented data and the completeness and fairness of the presentation including all disclosures rests with the City. In our opinion, the data is accurate in all material aspects, is presented in a manner designed to fairly set forth the financial position and results of operations of the City and contains all disclosures necessary to enable the reader to gain an understanding of the City’s financial affairs.

The financial statements are prepared in accordance with Generally Accepted Accounting Principals (GAAP) as promulgated by the Government Accounting Standards Board (GASB). This report consists of management’s representations concerning the finances of the City. Consequently, management assumes full responsibility for the completeness and reliability of all the information presented in this report. To provide a reasonable basis for making these presentations, management of the City has established a comprehensive internal control framework that is designed to protect the City’s assets from loss, theft, or misuse, and to compile reliable information for the preparation of this report in conformity with GAAP. As management, we assert to the best of our knowledge and belief, this financial report is complete and reliable in all material respects within the reasonable assurance of the internal control framework.

The City’s financial statements have been audited by The Pun Group, a public accounting firm fully licensed and qualified to perform audits of the state and local governments within the State of California.

The audit was designed to obtain reasonable assurance about whether the basic financial statements are free of material misstatement. The independent auditor concluded, based on the audit, that there was a reasonable basis for rendering an unmodified opinion that the City of Seal Beach’s financial statements for the year ended June 30, 2024, are fairly presented in conformity with Generally Accepted Accounting Principles. The independent auditor’s report is presented as the first component of the financial section of this report.

GAAP requires that management provide a narrative introduction, overview, and analysis to accompany the basic financial statement 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 that section.

The City’s MD&A is immediately following the report of the independent auditors in the financial section of the ACFR.

PROFILE OF THE CITY
In 1904 J.C. Ord, a Civil War veteran, hired a 30–mule team to bring his small general store building from Los Alamitos to Bay City, where he set it down at the southwest corner of what is now known as Main Street and Electric Avenue.

J.C. Ord was one of five trustees voted into office in October 1915, the second Mayor, Postmaster, and the first Judge. His store on Main Street was the Post Office and Court House and the Jail House when it was necessary.
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On October 27, 1915, the City was incorporated and governed by an elected five-member council. The new City had an area of 1.25 square miles with a population of 250. Bay City was renamed Seal Beach in August 1913 as part of a marketing re-branding by the Guy M. Rush Realty Company.

Another area of Seal Beach, Surfside Colony, was founded in 1929 and is credited as the one of the first beach resort communities of its type on the West Coast, following Santa Monica, Malibu Colony and Anaheim Landing.

In early 1944 during World War II, the Navy purchased most of the land around Anaheim Landing to construct the United States Navy's Naval Weapons Station Seal Beach (NWS SB) for loading, unloading, and storing of ammunition for the Pacific Fleet. Today, NWS SB is the Navy’s primary West Coast ordnance storage, loading, and maintenance installation. Located entirely within NWS SB is the Seal Beach National Wildlife Refuge, which was established in 1972 and protects habitat for threatened and endangered species.

Meanwhile Leisure World, a retirement community which comprises nearly a third of the city’s residents, opened in 1962. Construction of homes in the College Park East and West neighborhoods occurred in the early 1960s.

The City has an area of 13.23 square miles and sits on the coast as the gateway to Orange County between the cities of Long Beach and Huntington Beach and currently has a population of 24,350.

ECONOMIC CONDITIONS
Local economy: Although the focus of this Annual Comprehensive Financial Report is the financial condition of the City at June 30, 2024, it may be best understood when it is considered from the broader perspective of the specific environment within which the City operates. The City has experienced a strong economic recovery after the challenging financial environment caused by the pandemic. As consumer demand increased and services returned to normal, the City ended the fiscal year in a positive position.

Overall, the City’s General Fund revenue for the fiscal year increased by $4.0 million from the prior year.

This increase is mostly due to payments regarding the pier repairs and interest rate increases.

Property tax is the City’s largest General Fund revenue source with revenues of $15.4 million, an increase of 6.4 percent over the prior fiscal year. Sales tax is the second largest General Fund revenue source with revenues of $11.5 million including transaction tax, a decrease of 1.5 percent from the prior year.

Additionally, Transient Occupancy Tax was $1.9 million, a decrease of 0.2 percent, relatively flat from the previous year. The increase in Property Tax is due to the continued robust housing demographics in the City. The slight decrease in Sales Tax, compared to the prior year, is primarily due to a slowdown in the fuel and service stations industry and consumer spending shifting from goods to experiences like dining and entertainment.

Long-term financial planning: The City of Seal Beach continues to implement cost saving measures while providing the core services for our residents, businesses, visitors, and to protect all essential services that contribute to the high quality of life our residents expect. On a yearly basis, the City Council sets goals and priorities for the future. Each year the City develops a Five-Year Financial Outlook which is the guiding document for long-range fiscal planning and serves as the framework for development of the next adopted budget. The outlook is included in the budget process and incorporates a range of information on items that influence projected revenues and anticipated appropriation needs over the next five fiscal years. These projections inform the City Council and the public of the long-term costs of programs in the context of the City’s overall General Fund budget and projected revenue growth. In November 2024, Measure GG passed in Seal Beach with 68% voter approval, implementing a 0.5 percent increase in the local sales tax to support current essential City services and will begin in 2025. iii
The City continues to be in good financial health due to its stable tax base, disciplined fiscal decisions, and strong governance. Conservative budgeting and sound financial policies have resulted in reserve levels that meet City Council policy. The City Council adopted policy seeks to maintain the reserve level between 20 to 25 percent of the General Fund adopted appropriations. The reserve may be used at the discretion of the City Council to provide resources during temporary decreases in revenues, in the event of an economic downturn while expenditure reductions are implemented, or to provide resources to meet emergency expenditures in the case of flood, fire, earthquake, landslides, or other natural disasters. At June 30, 2024, the reserve balance was $10.5 million or 22.0 percent of the final operating budget.

Major initiatives: The Strategic Plan goals are approved and/or affirmed by the City Council each year.

Priorities included Organizational Efficiencies, Community Outreach and Capital Projects, Housing Element Updates, Local Coastal Plan, Fiscal Sustainability, Flooding, and Public Safety. Highlights of this year’s major initiatives reflect the City’s commitment to sustaining the community’s quality of life and fiscal health. Key accomplishments include enhancing public safety services through funding for emergency response and community policing, upgrading critical infrastructure such as streets and recreational facilities, and maintaining essential transportation programs like the senior shuttle and the micro-transit pilot program. The City also prioritized preserving beaches and neighborhoods, reducing the unfunded pension liability, and fostering community engagement. Notable achievements include the completion of the new Tennis and Pickleball Center, a major beach sand restoration project recovering nearly 2 million cubic feet lost to storm erosion, and revisions to the Housing Element. Despite volatile economic conditions, the City remained fully operational, reinstated live recreational programs, and continued to deliver essential services to the community.

FINANCIAL POLICIES AND PROCEDURES
Internal control structure: Management of the City is responsible for establishing and maintaining an adequate internal control structure. Internal accounting controls are designed to ensure that the assets of the City are protected from loss, theft, or misuse, and that adequate accounting data are compiled to allow for the preparation of financial statements in conformity with generally accepted accounting principles.

The internal control structure is designed to provide reasonable, but not absolute, assurance, that these objectives are met. The concept of reasonable assurance recognizes that: (1) the cost of the control should not exceed the benefits likely to be derived; and (2) the valuation of costs and benefits require estimates and judgment by management.

Budgetary controls: The annual budget serves as the foundation for the City of Seal Beach’s financial planning and control. The City Council adopts an annual budget and appropriates the funds necessary to provide the services and operations for the fiscal year. The City Manager may make appropriation transfers within and between departments which do not result in an increase in appropriations. The City of Seal Beach City Council must approve all appropriation changes that result in an increase in appropriations.

AWARDS
GFOA Award Program – Annual Comprehensive Financial Report The Government Finance Officers Association of the United States (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Seal Beach for its Annual Comprehensive Financial Report for the fiscal year ended June 30, 2023. This was the twenty-second consecutive year that the City has received this prestigious award. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized Annual Comprehensive Financial Report. This report must satisfy both generally accepted accounting principles and applicable legal requirements.
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A Certificate of Achievement is valid for a period of one year only. City staff believe that our current Annual Comprehensive Financial Report continues to meet the Certificate of Achievement Program’s requirements and we are submitting it to the GFOA again this year for award.

ACKNOWLEDGEMENTS
This report was made possible by the highly dedicated Finance staff with their dedicated efforts and teamwork, special thanks to the staff in the Finance Department. Sincere appreciation is also expressed to the City Council and City Manager for their interest and support, which made this presentation possible, and finally to the City’s auditing firm of The Pun Group for their professional assistance.

Respectfully submitted,
Barbara Arenado
Director of Finance/City Treasurer
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Seal Beach
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2023
Executive Director/CEO
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ORGANIZATIONAL CHART
Schelly Sustarsic Mayor
Lisa Landau Mayor Pro Tem
Joe Kalmick Council Member
Thomas Moore Council Member
Nathan Steele Council Member
Exercise Administrative Control
Over All Departments
Agenda Preparation
Represents City in all legal matters Administrative Policies City Council Support
Computer Network Administration
Intergovernmental Relations
Special Studies/Projects
Policy Analysis
Risk Management
Financial Services/Reporting
Business Tax
Utility Billing/Cashiering Employee Benefits
Budget/Audit/Grants Classification/Compensation
Accounts Payable/Payroll
Debt Administration
Treasury/Investments
Successor Agency Administration
Engineering
Fleet Maintenance
Beach Maintenance
Water/Sewer Maintenance
Capital Projects
Storm Drains
Planning Building Maintenance
Building/Code Enforcement Street Maintenance
Development Review Traffic and Transportation
Community Development Block Grant
Land Use and Coastal Issues
General Plan and Code
Traffic/Patrol/Detective Services
Youth/Adult Class Activity Parking Control
Special Event Permitting Detention Center
Sports League/Events
Beach/Pool Safety
Jr. Lifeguard Program
Records Management
Election Management
Gloria D. Harper, City Clerk
Joe Bailey, Marine Safety Chief
Orange County Fire Authority
Personnel Recruitment

MARINE SAFETY

FIRE SERVICES

HUMAN RESOURCES

COMMUNITY SERVICES

CITY CLERK

POLICE SERVICES
Nicholas R. Ghirelli, City Attorney
Iris Lee, Director of Public Works
Michael Henderson, Chief of Police

FINANCE

DEVELOPMENT

COMMUNITY

PUBLIC WORKS
Alexa Smittle, Director of Community
Development & Community Services
FY 2023-2024

CITIZENS OF SEAL BEACH

MAYOR AND CITY COUNCIL
Barbara Arenado, Director of
Finance/City Treasurer

CITY MANAGER

CITY ATTORNEY
Jill R. Ingram, City Manager
Patrick Gallegos, Assistant City Manager
vi

CITY OF SEAL BEACH

CALIFORNIA
Principal Officers
City Council
6FKHOO\6XVWDUVLF, Mayor
/LVD/DQGDX, Mayor Pro Tem
-RH.DOPLFN, Council Member
7KRPDV0RRUH, Council Member
1DWKDQ6WHHOH, Council Member
Executive Officers
Jill R. Ingram, City Manager
1LFKRODV*KLUHOOL, City Attorney
Administrative Personnel
Patrick Gallegos, Assistant City Manager
0LFKDHO+HQGHUVRQ, Chief of Police
,ULV/HH, Director of Public Works
Barbara Arenado, Director of Finance/City Treasurer
Alexa Smittle, Director of Community Development
Joe Bailey, Marine Safety Chief
Gloria D. Harper, City Clerk
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200 E. Sandpointe Avenue, Suite 600
Santa Ana, California 92707
INDEPENDENT AUDITORS’ REPORT
To the Honorable Mayor and the Members of the City Council of the City of Seal Beach
Seal Beach, California
Report on the Audit of the Financial Statements
Opinions
We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of City of Seal Beach, California (the “City”), as of and for the year ended June 30, 2024, 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 accompanying 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, 2024, and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America (“GAAS”) and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States (“Government Auditing Standards”). Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

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

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.

To the Honorable Mayor and the Members of the City Council of the City of Seal Beach
Seal Beach, California

Page 2 ends

2 Auditors’ Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an 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 GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

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

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

Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management’s Discussion and Analysis, the Budgetary Comparison Schedules, the Schedule of the City's Proportionate Share of the Net Pension Liability and Related Ratios, the Schedules of Contributions – Pensions, the Schedule of Changes in Net Other Postemployment Benefits Liability and Related Ratios, and the Schedule of Contributions – Other Postemployment Benefits be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the Required Supplementary Information in accordance with GAAS, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

To the Honorable Mayor and the Members of the City Council of the City of Seal Beach
Seal Beach, California

Page 3 ends

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 Combining and Individual Fund Financial Statements are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with GAAS. In our opinion, the Combining and Individual Fund Financial Statements are fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Information
Management is responsible for the other information included in the annual report. The other information comprises the Introductory and Statistical Sections 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 basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated January 29, 2025 on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.

Santa Ana, California
January 29, 2025
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City of Seal Beach
Management’s Discussion and Analysis (Unaudited)
For the Year Ended June 30, 2024
5 Management of the City of Seal Beach is pleased to offer this narrative overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2024, along with comparisons to the fiscal year ended June 30, 2023. All increases and decreases are expressed relative to fiscal year 2022-2023. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal and the City’s financial statements.

FINANCIAL HIGHLIGHTS
 The City’s net position – the difference between its assets and deferred outflows of resources compared to its liabilities and deferred inflows of resources – was $144.0 million, an increase of $3.8 million or 2.7%. The net position of governmental activities increased by $5.1 million or 5.4%, while the net position of businesstype activities decreased by $1.4 million or 3.0%.  The net position of $144.0 million consisted of $117.0 million of net investment in capital assets; $9.9 million of resources that are subject to external restrictions on how they may be used; $3.5 million that may be used to meet the City’s obligations for its governmental activities; and $13.6 million to meet obligations for its business-type activities.
 Total revenues were $63.8 million and total expenses were $60.0 million. Revenues increased by $4.9 million or 8.3%, and expenses increased by $15.0 million or 33.3%.  As of the close of the fiscal year, the City’s governmental funds reported combined ending fund balances of $46.6 million, representing an increase of $2.1 million or 5.7%. Of this amount, $11.2 million (the sum of assigned and unassigned fund balances) is available for spending at the City’s discretion.  At the end of the current fiscal year, unassigned fund balance in the General Fund was $5.2 million or 10.8% of total General Fund expenditures and transfers out.
 The City’s Reserve Fund Policy aims to maintain a minimum balance in the Fiscal Policy Reserve equal to approximately three months’ worth of the City’s General Fund operating expenditures. As of June 30, 2024, the Committed-Fiscal Policy Reserve has a balance of $10.5 million, or 24.0% of General Fund expenditures (less transfers out related to capital projects). This percentage aligns with the City’s goals and is in accordance with the recommendation of the Government Finance Officers Association (GFOA).

OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis are intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements are comprised of three components: 1) government-wide financial statements, 2) fund financial statements; and 3) notes to the basic financial statements. This report also contains other supplementary information in addition to the basic financial statements.

Government-Wide Financial Statements – The government-wide financial statements are designed to provide readers with a view of the City’s finances, in a manner similar to a private-sector business.

The Statement of Net Position presents information on all assets and liabilities, deferred outflows and inflows with the difference between them reported as net position. Over time, increases or decreases in the City’s net position are one indicator of whether its financial condition is improving or deteriorating.

City of Seal Beach
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
6 The Statement of Activities presents information showing how the City’s net position changed during the most recent fiscal year. These changes are reported on a full accrual basis when the economic event occurs. regardless of when cash is received or paid.

Both government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government and administration, public safety, development services, public works, recreation, and all its component units that are legally separate but whose activities entirely support the City of Seal Beach. The business-type activities of the City include water and sewer operations.

The government-wide financial statements can be found immediately following this discussion and analysis.

Fund Financial Statements – The fund financial statements provide detailed information about the most significant funds and other funds – not the City as a whole. Some funds are required to be established by State law and by bond covenants. However, management established many other funds to help control and manage money for particular purposes or to verify that all legal requirements for using certain taxes, grants, and other resources are being satisfied.

The City’s three types of funds are governmental, proprietary, and fiduciary funds.

Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on how money flows in and out of those funds and the balances left at fiscal year-end that are available for spending. These funds are reported using an accounting method called modified accrual accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the City’s general government operations and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance the City’s programs. The differences of results in the Governmental Fund financial statements to those in the government-wide financial statements are explained in a reconciliation following each of the Governmental Fund financial statements.

The City maintains individual governmental funds organized by their type (general, special revenue, debt service, and capital improvements funds). Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures and changes in fund balances for the General Fund and Capital Projects and Equipment Capital Projects Fund, which are considered to be major funds. Data from the remaining governmental funds are combined into a single, aggregated presentation. Individual fund data for each of the other governmental funds is provided in the form of combining statements and schedules elsewhere in this report.

The City adopts an annual appropriated budget for its General Fund, Debt Service Fund, and all of the Special Revenue Funds. Budgetary comparison statements have been provided to demonstrate compliance with this budget.

The basic governmental fund financial statements can be found immediately following the government-wide financial statements.

Proprietary funds are reported in the same way that all activities are reported in the Statement of Net Position and the Statement of Activities. In fact, the City’s enterprise funds are comprised of the business-type activities reported in the government-wide statements but provide more detail and additional information such as a statement of cash flows. Customer charges for various City services are generally reported in proprietary funds. The basic proprietary fund financial statements can be found immediately following the governmental funds financial statements.

City of Seal Beach
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
7 Fiduciary funds account for assets held by the City in a trustee capacity, or as an agent for other governmental entities, private organizations, or individuals. All the City’s fiduciary activities are reported in a separate statement of fiduciary net position and a statement of changes in fiduciary net position. These activities are excluded from the City’s government-wide financial statement because the City cannot use these assets to finance its operations. The basic fiduciary fund financial statements can be found immediately following the proprietary funds financial statements.

Notes to the Basic Financial Statements – The notes provide additional information that is essential to fully understand the data provided in the government-wide and fund financial statements. The notes to the basic financial statements can be found immediately following the fiduciary funds financial statements.

Required Supplementary Information (Unaudited) and Supplementary Information – In addition to the required elements of the basic financial statements, a required supplementary information section concerning the City’s progress in funding it obligation to provide pension and other post-employment benefits to City employees is included. Also included in this section are the budgetary comparison schedules for the general and major funds. The required supplementary information can be found immediately following the notes to the basic financial statements.

Combining statements and individual fund statements for non-major governmental funds, internal service and custodial funds are presented immediately following the required supplementary information.

GOVERNMENT-WIDE FINANCIAL ANALYSIS
The Government-wide Financial Analysis focuses on the City’s net position and changes in net position resulting from the City’s activities as a whole.

Analysis of Net Position – As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. The City’s combined net position was $144.0 million and $140.2 million for the years ended June 30, 2024, and June 30, 2023, respectively, as shown in Table 1. 2024 2023* 2024 2023* 2024 2023*
Current and other assets 62,658 $ 61,898 $ 19,762 $ 19,864 $ 82,420 $ 81,762 $ Capital assets 88,007 85,343 33,746 34,534 121,753 119,877 Total assets 150,665 147,241 53,508 54,398 204,173 201,639 Deferred outflows of resources 20,128 21,111 2,443 2,171 22,571 23,282 Long-term liabilities outstanding 52,856 53,514 9,637 9,743 62,493 63,257 Other liabilities 5,635 4,841 1,742 1,472 6,583 7,107
Total liabilities 57,697 59,149 11,379 11,215 69,076 70,364 Deferred inflows of resources 12,636 13,893 1,038 455 13,674 14,348 Net position
Net investment in capital assets 87,074 83,687 29,884 30,163 116,958 113,850 Restricted 9,915 10,354 25 25 9,940 10,379
Unrestricted 1,269 3,470 13,624 14,713 17,094 15,982
Total net position 100,459 $ 95,310 $ 43,533 $ 44,901 $ 143,992 $ 140,211 $ * as restated
(in Thousands)
Governmetal Activities
Table 1
Business-Type Activities Total Activities
Condensed Statement of Net Position
City of Seal Beach
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
8 As of June 30, 2024, the City continued to report positive balances in all three categories of net position for the government as a whole.

Net position – Net investment in capital assets ($117.0 million or 81.2% of total net position) represents capital assets, such as land, buildings, infrastructure, and equipment, less any related outstanding debt used to acquire those assets. This is an overall increase of $3.1 million, or 2.7%. The City uses these capital assets to provide services to the citizens; consequently, these assets are not available for future spending. Although the investment in capital assets is reported net of related debt, resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.

Net position – Restricted ($9.9 million or 6.9% of total net position) represents resources that are subject to external restrictions on how they may be used. This is a decrease of $0.4 million, or 4.2%. The majority of this decrease occurred in restrictions for public works, which decreased $0.7 million, or 12.3%.

Net position – Unrestricted ($17.1 million or 11.9% of total net position) represents an increase of $1.1 million or

7.0%. The governmental activities unrestricted of $3.5 million is an increase of $2.6 million or 301.5% as a result of the effect of implementing Governmental Accounting Standards Board (GASB) statements related to pension and other post-employment benefits (OPEB) liabilities. The total deferred inflows of resources on pension plans decreased by $2.4 million as a result of net differences between projected and actual earnings on pension plan investments. Generally accepted accounting principles require financial statement recording when a liability is incurred. However, the City, like many other governments, raises and budgets resources needed to liquidate certain liabilities during the year in which the liability is to be liquidated rather than during the year in which the liability is incurred. The City will continue to fund these obligations on an actuarial basis, contributing the full amount of annual required contributions every year.

Analysis of Activities – The City’s net position increased by $3.8 million or 2.7%. The following Table 2 provides a summary of the City’s operations for the years ended June 30, 2024, and June 30, 2023. 2024 2023* 2024 2023* 2024 2023*
Revenues:

Program revenues:

Charges for services 9,266 $ 8,924 $ $ 8,712 $ 8,132 $ 17,978 $ 17,056 Operating grants and contributions 4,318 4,308 - - 4,318 4,308 Capital grants and contributions 1 1 - - 1 1
General revenues:

Taxes:

Property taxes 15,386 14,468 - 15,386 - 14,468
Sales taxes 11,495 11,667 - 11,495 - 11,667
Utility user taxes 5,510 5,349 - - 5,510 5,349
Other taxes 3,889 4,202 - - 3,889 4,202
Use of money and property 2,673 782 401 290 3,074 1,072 Other 2,109 1,145 - - 2,109 1,145
Total revenues 54,647 50,846 9,113 8,422 63,760 59,268
Expenses:

General government 7,834 8,171 - - 7,834 8,171
Public safety 26,933 20,575 - 26,933 - 20,575
Community development 2,723 1,836 - - 2,723 1,836
Community services 1,208 264 - - 1,208 264
Public works 10,766 8,583 - 10,766 - 8,583
Interest on long-term debt 34 36 - - 34 36
Water - 7,128 - 5,188 7,128 5,188
Sewer - 3,353 - 2,122 3,353 2,122
Total expenses 49,498 39,465 10,481 7,310 59,979 46,775 Change in net position before transfers 5,149 11,381 (1,368) 1,112 3,781 12,493 Transfers 734 - (734) - - -
Changes in net position 5,149 12,115 (1,368) 378 3,781 12,493 Net position at beginning of year 95,310 83,195 44,901 44,523 140,211 127,718 Net position at end of year $ 100,459 $ 95,310 $ 43,533 $ 44,901 143,992$ 140,211$ * as restated
Condensed Statement of Activities
(in Thousands)
Governmental Activities Business-Type Activities Total Activities City of Seal Beach
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
9 Governmental Activities experienced an increase of $5.1 million in net position as of June 30, 2024, compared to an increase of $13.7 million at June 30, 2023. The reason for this year-to-year net increase of $5.1 million is due to increases of $4.2 million in revenues in addition to increases to total expenditures of $12.0 million.

The overall net change in revenues is due to recognizing 1) payments received regarding the pier, and 2) increases in use of money and property due to rising interest rates throughout the fiscal year.

The cost of all governmental activities during the current fiscal year was $49.5 million, which is a $12.0 million increase from fiscal year 2022-2023. The majority of this increase was due to pension expenses increasing by $3.1 million (refer to Note 9 of the Notes to the Basic Financial Statements for further analysis of the pension expense). The largest operating cost was comprised of Public Safety, representing 54.4% of total governmental expenditures compared to 53.6% of total governmental expenditures in fiscal year 2022-2023.

Business-type Activities net position decreased by $1.3 million. The City is in the process of an updated water and sewer rate study that will be conducted in 2025. Increases in operating costs were mostly due to repairs and imported water. The net position decreased by nearly $1.3 million from operations. During the year, business-type activities paid $0.7 million in administrative costs which were recorded as revenues to governmental activities.

FINANCIAL ANALYSIS OF CITY FUNDS
The City uses fund accounting to provide proper financial management of the City’s resources and to demonstrate compliance with finance-related legal requirements.

Governmental funds – The objective of governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City’s financing requirements. In particular, unreserved fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year. As of June 30, 2024, the City’s governmental funds reported combined ending fund balances of $46.6 million. Approximately $4.5 million, or 9.6% of this total amount, constitutes unassigned fund balance. The remainder of the fund balance is reported as nonspendable, restricted, committed, or assigned to indicate that it is not available for new spending because it has already been designated to pay for encumbrances, loans, prepaid expenses, or advances to other funds or has been legally restricted for other purposes.

The General Fund ended the fiscal year with a fund balance of $39.5 million, representing a net increase of $1.9 million. In comparison, in the prior fiscal year, the General Fund had a net increase of $3.0 million to fund balance.

Fiscal year 2023-2024 had an increase of $4.1 million in revenues which was due to payments received from the pier and interest rate increases, offset by an increase in expenditures of $2.9 million. The primary reason for the increase in fund balance is due to revenues over expenditures of $6.2 million offset by net transfers of $4.3 million. Net transfers increased by $2.3 million compared to the prior fiscal year.

Total governmental fund revenues increased overall by $5.1 million or 10.2% due to collecting higher tax revenues; payments regarding the pier, offset by slight reductions in licenses and permits and fines and forfeitures, and by increases in interest earnings due to rising interest rates throughout the fiscal year which caused an increase in the fair value of investments as of June 30. Overall expenditures increased by $6.0 million or 12.9%, as the City continued to support essential City services and support to residents and businesses.

Proprietary funds – The City’s proprietary funds financial statements provide the same type of information found in the government-wide financial statements, but in more detail. Unrestricted net position totaled $3.2 million and $10.4 million for the Water and Sewer Funds, respectively. The Water Fund had an operating loss of $0.8 million and the Sewer Fund also had an operating loss of $0.8 million. The City is currently going through a rate study that may address this.

City of Seal Beach
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
10 GENERAL FUND BUDGETARY HIGHLIGHTS
When preparing its budget, the City attempts to estimate its revenues using realistic, but conservative methods to budget its expenditure appropriations in a prudent manner. Amendments were approved during the fiscal year to the adopted budget. The fiscal year 2023-2024 General Fund’s revenue budget was adopted at $46.4 million and had amendments to taxes and intergovernmental, offset by fined and forfeitures of $1.5 million. The fiscal year 2023- 2024 General Fund’s original (adopted) budget for expenditures was $45.8 million, and the final budget was $47.8 million, a net increase of $2.0 million. The largest change was an increase of $1.3 million in Public Works due to rising labor and material cost. This increase also resulted from certain legacy contracts, which historically had lower costs, now coming in at higher amounts upon expiration and rebid.

The General Fund balance reflected a net total positive budget variance of $16.8 million when comparing actual amounts to the final amended budget for the current fiscal year. Actual revenues show a positive variance of $3.9 million or 8.4% of the final budget due to unanticipated receipts of taxes and insurance reimbursement revenues due to a case settlement. Actual expenditures of $44.2 million generated budgetary savings of $3.6 million, or 7.6% of the final budget mostly due to savings in Public Works stemming from several factors, including (1) several unexpected vacancies that were not filled promptly, which, in turn, impacted the ability to carry out the planned work; (2) funds were allocated for emergency-related purposes due to uncertain climate conditions, but not all those funds were utilized; (3) the message to overall reduce City-wide expenditures to meet future-year funding availability; and (4) carry-over of encumbrances of work that straddled two or more fiscal years. Additionally, although capital outlay was budgeted, project delivery extended across multiple fiscal years, and changes in project scope led to expenditures being lower than anticipated.

CAPITAL ASSETS
The City’s capital assets for its governmental and business-type activities as of June 30, 2024, total $121.8 million compared to $121.6 million (net of accumulated depreciation and amortization) as of June 30, 2023. The investment in capital assets includes land, land easements, building and improvements, machinery and equipment, vehicles, infrastructure, leases, subscriptions and construction in progress as summarized in the following Table 3. Additional information on the City’s capital assets can be found in Note 5 in the notes to the basic financial statements. 2024 2023* 2024 2023* 2024 2023*
Land and land easements 21,220 $ 21,220 $ - $ - $ 21,220 $ 21,220 $ Buildings and improvements 7,841 8,250 - - 7,841 8,250
Machinery and equipment 1,328 1,648 585 617 1,913 2,265 Vehicles 1,235 1,377 247 74 1,482 1,451
Infrastructure 46,871 48,751 29,434 30,767 76,305 79,518 Lease assets 203 321 - - 203 321
Subscription assets 450 706 202 284 652 990
Construction-in-progress 8,859 3,070 3,278 2,792 12,137 5,862 Totals 88,007 $ 85,343 $ 33,746 $ 34,534 $ 121,753 $ 119,877 $ * as restated
Table 3
Capital Assets, At Fiscal Year-End
(Net of Depreciation, in Thousands)
Governmental Activities Business-Type Activities Total Activities City of Seal Beach
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
11 During fiscal year 2023-2024, major capital projects formally completed include:
 Environmental Clean Up Program Project (SD2201) - $425,576  Seal Beach Pier Emergency Pier Repair (EM2023) - $1,265,484.08  Lampson Avenue Fiber (O-ST-6) - $383,264.04
 Annual ADA Improvements – Public ROW (O-ST-4):
o Sidewalk Assessment and Trip Hazard Removal Services - $114,483 o Pedestrian Improvement (Central Way at 1st Street) Project - $46,221  FY 20233-24 Annual Slurry Seal Program (STO1) - $243,888.92  Seal Beach Boulevard Water Main Repair (EM2402) - $256,456.15  LED Chevron Signs at Seal Beach Boulevard and Westminster Avenue (ST2302) - $54,275

DEBT ADMINISTRATION
As of June 30, 2024, the City had bonded debt, lease liabilities, notes payable, subscription liabilities, claims payable, and compensated absence liabilities totaling $6.3 million compared to $7.7 million at the end of the fiscal year 2022- 2023. The City’s governmental activities maintained $2.3 million in lease revenue bonds, leases, subscription liabilities, claims payable, and compensated absences versus $3.1 million last fiscal year, representing a decrease of approximately $0.8 million. This decrease reflects the payoff of the fire station bond and the Climatec as well as interest and principal payments made during fiscal year 2023-2024 in addition to an increase to leases.

The City’s business-type activities debt decreased $.5 million from $4.5 million to $4.0 million. Debt in the businesstype activities consists of lease revenue bonds, State loans for water and sewer capital improvement projects, subscription liabilities and compensated absences. The decrease reflects interest and principal payments made during fiscal year 2023-2024.

A summary of outstanding debt can be found in the following Table 4, and additional information on the City’s longterm debt can be found in Note 6 in the basic financial statements. 2024 2023 2024 2023 2024 2023
Lease revenue bonds - $ 315 $ 1,180 $ 1,385 $ 1,180 $ 1,700 $ Leases 210 546 - 210 - 546
Capital project notes - - 2,500 2,758 2,500 2,758
Subscription liabilities 456 695 205 277 661 972
Self-insured Claims Payable 171 175 - 171 - 175
Compensated absences 1,455 1,395 127 114 1,582 1,509
Total $ 2,292 $ 3,126 $ 4,012 $ 4,534 $ 6,304 $ 7,660
Table 4
Outstanding Debt, At Fiscal Year-End
(in Thousands)
Governmental Activities Business-Type Activities Total Activities ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS
The City of Seal Beach economy and tax base continue to support core services for our residents, businesses, and visitors contributing to the high quality of life within the City. The City has largely emerged from the pandemicdepressed revenues due to improved economic activity. For the upcoming fiscal year, revenues are expected to continue to improve. However, challenges from high inflation and supply chain issues temper the recovering outlook.

City of Seal Beach
Management’s Discussion and Analysis (Unaudited) (Continued) For the Year Ended June 30, 2024
12 Property taxes are expected to increase as well, primarily from continued improvement in assessed value and the continued strength in the local real estate market.

The City prepared a balanced annual budget for fiscal year 2024-2025. Expenditures of the City were reduced to maintain the current level of service with capital improvement projects to be supported primarily by the City’s General Fund Balance. The revenue projections for the 2024-2025 budget year were conservative and determined in partnership with the City’s consultants.. In November 2024, Measure GG passed in Seal Beach with 68% voter approval, implementing a 0.5% increase in the local sales tax to support current essential City services and will begin in 2025. The City will continue to monitor revenue streams throughout the coming years and will adjust spending levels as necessary.

The most significant issues facing the City are the aged condition of the City’s infrastructure. The City has completed and adopted numerous infrastructure planning documents (i.e., Water Master Plan, Sewer Master Plan, Master Plan of Drainage, Facilities Master Plan, and Pavement Management Plan). These plans identify well over $160 million in needed improvements throughout the City. The City annually adopts a 5-year Capital Improvement Program (CIP) that strategically plans construction of these needed improvements. The fiscal year 2025-2029 CIP recommends approximately $35.6 million in improvements over the next 5 years, including $2.9 million for implementation of Revitalization projects. The 5-Year Capital Improvement Program identifies needs in the following areas: Buildings ($14.9M), Beach and Pier ($1.7M), Parks ($1.8M), Sewer System ($2.9M), Streets and Transportation ($11.0M), Storm Drain ($.7M), and Water System ($0.6M). It should be noted that a comprehensive Water System 5-Year CIP projection is not included and is deferred until a Water/Sewer Financial Plan/Rate Update is approved.

REQUEST FOR INFORMATION
This financial report is designed to provide the City’s citizens, taxpayers, customers, investors, and creditors with a general overview of the City’s finances and to demonstrate the City’s accountability for the funds it receives. If you have questions about this report or need additional financial information, contact the City’s Finance Department at 211 8th Street, Seal Beach, CA 90740-6379 or call (562) 431-2527.

BASIC FINANCIAL STATEMENTS
13 This page intentionally left blank.
14 GOVERNMENT-WIDE FINANCIAL STATEMENTS
15 Governmental Business-Type
Activities Activities Total
ASSETS
Current Assets:

Cash and investments 43,596,480 $ 18,270,865 $ 61,867,345 $ Accounts receivable 1,955,142 1,419,992 3,375,134
Taxes receivable 3,614,683 - 3,614,683
Lease receivable, due within one year 355,053 - 355,053 Interest receivable 389,231 - 389,231
Prepaid items 2,978,558 46,428 3,024,986
Total current assets 19,737,285 52,889,147 72,626,432
Noncurrent Assets:

Restricted cash with fiscal agent 11,347 25,082 36,429
Lease receivable, due in more than one year 9,757,574 - 9,757,574 Capital assets:

Capital assets, not being depreciated 30,078,810 3,277,791 33,356,601 Capital assets, being depreciated, net 57,274,615 30,265,628 87,540,243 Intangible capital assets, being amortized, net 653,165 201,971 855,136 Total capital assets, net 88,006,590 33,745,390 121,751,980 Total noncurrent assets 33,770,472 97,775,511 131,545,983 Total assets 53,507,757 150,664,658 204,172,415

DEFERRED OUTFLOWS OF RESOURCES
Deferred charges on refunding - 60,352 60,352
Pension related 18,828,936 1,588,749 20,417,685
Other postemployment benefits related 1,298,695 793,612 2,092,307 Total deferred outflows of resources 2,442,713 20,127,631 22,570,344 (Continued)
Primary Government
City of Seal Beach
Statement of Net Position
June 30, 2024
See accompanying Notes to the Basic Financial Statements 16 Governmental Business-Type
Activities Activities Total

LIABILITIES
Current Liabilities:

Accounts payable 2,905,229 1,420,668 4,325,897
Accrued liabilities 616,661 52,854 669,515
Accrued interest 41,449 - 41,449
Deposits payable 1,052,337 190,678 1,243,015
Retention payable 266,604 36,802 303,406
Long-term liabilities, due within one year 688,752 666,396 1,355,148 Total current liabilities 2,408,847 5,529,583 7,938,430 Long-term liabilities:

Long-term liabilities, due in more than one year 1,603,288 3,345,562 4,948,850 Net pension liabilities 48,255,007 4,213,883 52,468,890 Net other postemployment benefits liabilities 2,308,853 1,410,904 3,719,757 Total noncurrent liabilities 8,970,349 52,167,148 61,137,497 Total liabilities 11,379,196 57,696,731 69,075,927

DEFERRED INFLOWS OF RESOURCES
Pension related 1,222,874 243,576 1,466,450
Other postemployment benefits related 1,300,693 794,833 2,095,526 Leases related 10,112,627 - 10,112,627
Total deferred inflows of resources 1,038,409 12,636,194 13,674,603

NET POSITION
Net investment in capital assets 87,073,859 29,884,131 116,957,990 Restricted for:

Community development projects 1,045,996 - 1,045,996
Public safety 1,335,100 - 1,335,100
Community services 562,850 - 562,850
Public works 4,999,824 - 4,999,824
Debt service 25,082 662,234 687,316
Waste management, park in lieu, and I-405 corridor improvement 1,309,234 - 1,309,234 Total restricted 9,915,238 25,082 9,940,320
Unrestricted 13,623,652 3,470,267 17,093,919
Total net position $ 43,532,865 100,459,364 $ 143,992,229 $ (Concluded)
City of Seal Beach
Statement of Net Position (Continued)
June 30, 2024
Primary Government
See accompanying Notes to the Basic Financial Statements 17 Capital Grants
Charges for Operating Grants and
Expenses Services and Contributions Contributions Total Functions/Programs
Governmental Activities:

General government 7,833,713 $ 1,252,570 $ 2,284 $ - $ 1,254,854 $ Public safety 26,932,724 1,976,293 826,081 - 2,802,374
Community development 2,722,452 508,638 554,573 - 1,063,211 Community services 1,208,181 1,328,884 - - 1,328,884
Public works 10,766,275 4,199,836 2,848,625 1,199 7,049,660 Interest and fiscal charges 34,336 - - - -
Total governmental activities 9,266,221 49,497,681 4,231,563 1,199 13,498,983 Business-Type Activities:

Water utility 7,127,839 6,289,312 - - 6,289,312
Sewer utility 3,353,390 2,422,870 - - 2,422,870
Total business-type activities 8,712,182 10,481,229 - - 8,712,182 Total primary government $ 17,978,403 59,978,910 $ 4,231,563 $ 1,199 $ 22,211,165 $ (Continued)
Program Revenues
City of Seal Beach
Statement of Activities
For the Year Ended June 30, 2024
See accompanying Notes to the Basic Financial Statements 18 Governmental Business-Type
Activities Activities Total
Functions/Programs
Governmental Activities:

General government (6,578,859) $ - $ (6,578,859) $
Public safety (24,130,350) - (24,130,350)
Community development (1,659,241) - (1,659,241)
Community services 120,703 - 120,703
Public works (3,716,615) - (3,716,615)
Interest and fiscal charges (34,336) - (34,336)
Total governmental activities - (35,998,698) (35,998,698) Business-Type Activities:

Water Utility (838,527) - (838,527)
Sewer Utility (930,520) - (930,520)
Total business-type activities (1,769,047) - (1,769,047) Total primary government (1,769,047) (35,998,698) (37,767,745) General Revenues:

Taxes:

Property taxes, levied for general purpose 15,473,159 - 15,473,159 Sales taxes 11,494,982 - 11,494,982
Franchise taxes 1,236,189 - 1,236,189
Utility users tax 5,510,087 - 5,510,087
Transient occupancy taxes 1,919,725 - 1,919,725
Other taxes 732,341 - 732,341
Motor vehicle in lieu- unrestricted 31,179 - 31,179
Use of money and property 2,673,147 401,277 3,074,424
Other 2,076,956 - 2,076,956
Total general revenues and transfers 401,277 41,147,765 41,549,042 Changes in net position (1,367,770) 5,149,067 3,781,297 Net Position:

Beginning of year, as restated (Note 15) 95,310,297 44,900,635 140,210,932 End of year 100,459,364 $ 43,532,865 $ 143,992,229 $
(Concluded)
Net (Expense) Revenue and Changes in Net Positions
City of Seal Beach
Statement of Activities (Continued)
For the Year Ended June 30, 2024
See accompanying Notes to the Basic Financial Statements 19 This page intentionally left blank.
20 FUND FINANCIAL STATEMENTS
21 This page intentionally left blank.
22 GOVERNMENTAL FUND FINANCIAL STATEMENTS
23 This page intentionally left blank.
24 Capital Projects
Citywide Grants and Equipment Nonmajor
Special Revenue Capital Projects Governmental
General Fund Fund Funds Total
ASSETS
Cash and investments $ - 33,982,538 $ 1,148,892 $ 8,305,805 $ 43,437,235 $ Receivables:

Accounts 990,255 796,976 - 153,299 1,940,530
Taxes - 3,500,907 - 113,776 3,614,683
Interest - 389,231 - - 389,231
Leases - 10,112,627 - - 10,112,627
Due from other funds - 1,006,816 - - 1,006,816
Prepaid items - 2,978,558 - - 2,978,558
Restricted assets:

Cash and investments with fiscal agents - 11,347 - - 11,347 Total assets $ 990,255 52,779,000 $ 1,148,892 $ 8,572,880 $ 63,491,027 $

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES, AND FUND BALANCES
Liabilities:

Accounts payable $ 118,145 1,379,384 $ 904,141 $ 491,940 $ 2,893,610 $ Accrued liabilities - 601,397 - 15,264 616,661
Deposits payable - 1,052,337 - - 1,052,337
Due to other funds 840,260 - - 166,556 1,006,816
Retentions payable 31,850 22,300 157,404 55,050 266,604 Total liabilities 990,255 3,055,418 1,061,545 728,810 5,836,028 Deferred inflow of resources:

Unavailable revenue 141,900 761,934 - - 903,834
Leases - 10,112,627 - - 10,112,627
Total deferred inflow of resources 761,934 10,254,527 - - 11,016,461 Fund Balances:

Nonspendable 2,978,558 - - - 2,978,558
Restricted 1,309,234 - - 7,844,070 9,153,304
Committed 23,224,408 - 87,347 - 23,311,755
Assigned 6,714,071 - - - 6,714,071
Unassigned (deficit) 5,242,784 (761,934) - - 4,480,850
Total fund balances (761,934) 39,469,055 87,347 7,844,070 46,638,538 Total liabilities, deferred inflow of
resources and fund balances $ 990,255 52,779,000 $ 1,148,892 $ 8,572,880 $ 63,491,027 $ City of Seal Beach
Balance Sheet
June 30, 2024
Governmental Funds
See accompanying Notes to the Basic Financial Statements 25 Total Fund Balances - Total Governmental Funds $ 46,638,538 Nondepreciable $ 30,078,810
Depreciable, net of $582,469 reported in Internal Service Funds 56,692,146 Amortizable, net of $200,390 reported in Internal Service Funds 452,775 87,223,731 Lease liabilities $ (3,046)
Subscription liabilities (455,855)
Claims and judgments (171,203)
Compensated absences (2,084,814) (1,454,710)
Pension related deferred outflows of resources 18,828,936 $ Net pension liability (48,255,007)
Pension related deferred inflows of resources (1,222,874) (30,648,945) OPEB related deferred outflows of resources 1,298,695 $ Net OPEB liability (2,308,853)
OPEB related deferred inflows of resources (1,300,693) (2,310,851) 903,834
737,871
Net Position of Governmental Activities $ 100,459,364
Long-term liabilities are not due and payable in the current period and accordingly are not reported as fund liabilities. All liabilities, both current and long-term, net of $207,226 reported in Internal Service Funds, are reported in the Statement of Net Position:

Capital assets used in governmental activities were not current financial resources. Therefore, they were not reported in the Governmental Funds Balance Sheet.

Internal Service Funds were used by management to charge the costs of certain activities, such as insurance and equipment replacement to individual funds. The assets and liabilities of the Internal Service Funds were included in the governmental activities in the Government-Wide Statement of Net Position.

Revenue reported as unavailable revenue in the governmental funds when it is not received soon enough after year-end to be considered available. The availability criteria does not apply to the Government-Wide Financial Statements and, therefore, the revenue is recognized when eligibility requirements are met and earned.

Net other postemployment benefits liabilities and the related deferred outflows of resources and deferred inflows of resources are not due and payable in the current period or not available for current expenditures and are not reported in the governmental fund financial statements:

Net pension liabilities and the related deferred outflows of resources and deferred inflows of resources are not due and payable in the current period or not available for current expenditures and are not reported in the governmental fund financial statements:

City of Seal Beach
Reconciliation of the Governmental Funds Balance Sheet to the June 30, 2024
Government-Wide Statement of Net Position
Amounts reported for governmental activities in the Statement of Net Position were reported differently because:

See accompanying Notes to the Basic Financial Statements 26 Capital Projects
Citywide Grants and Equipment Nonmajor
General Special Revenue Capital Projects Governmental
Fund Fund Fund Funds Total
Revenues:

Taxes 36,002,178 $ - $ - $ 364,304 $ 36,366,482 $
Licenses and permits 939,640 - - - 939,640
Intergovernmental 1,789,580 801,754 - 3,040,775 5,632,109 Charges for services 6,674,619 - 22,840 93,847 6,791,306 Use of money and property 2,844,020 - - 176,447 3,020,467 Fines and forfeitures 1,402,597 - - - 1,402,597
Contributions 24,471 - - 45,000 69,471
Miscellaneous 661,060 - - - 661,060
Total revenues 801,754 50,338,165 22,840 3,720,373 54,883,132 Expenditures:

Current:

General government 7,374,474 - 98,146 73,544 7,546,164
Public safety 24,716,603 40,000 167,177 584,817 25,508,597 Community development 2,325,464 - - 373,863 2,699,327
Community services 1,399,938 - - - 1,399,938
Public works 7,304,526 156,575 1,047,870 237,693 8,746,664 Capital outlay 510,685 670,607 2,831,905 2,001,692 6,014,889 Debt service:

Principal retirement 493,805 - - 315,000 808,805
Interest and fiscal charges 25,235 - - 8,845 34,080
Total expenditures 867,182 44,150,730 4,145,098 3,595,454 52,758,464 Revenues over (under) expenditures (65,428) 6,187,435 (4,122,258) 124,919 2,124,668 Other Financing Sources (Uses):

Transfers in 109,000 - 4,069,624 442,713 4,621,337
Transfers out (4,414,032) (98,305) - (109,000) (4,621,337) Total other financing sources (uses): (98,305) (4,305,032) 4,069,624 333,713 - Net change in fund balances (163,733) 1,882,403 (52,634) 458,632 2,124,668 Fund Balances:

Beginning of year, as restated (Note 15) 37,586,652 (598,201) 139,981 7,385,438 44,513,870 End of year $ (761,934) 39,469,055 $ 87,347 $ 7,844,070 $ 46,638,538 $ City of Seal Beach
Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds
For the Year Ended June 30, 2024
See accompanying Notes to the Basic Financial Statements 27 Net Change in Fund Balances - Total Governmental Funds $ 2,124,668 Capital assets used in governmental activities are not financial resources and therefore are not reported in governmental funds.

Capital outlay, net of $0 reported in Internal Service Fund 6,014,889 $ Depreciation and amortization, net of $266,364 reported in Internal Service Fund (2,942,534) Net effect on disposal of capital assets, net of $13,344 reported in Internal Service Fund (129,371) 2,942,984 Repayment of debt principal, net of $80,587 reported in Internal Service Fund, is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the Statement of Net Position. 808,805
Interest expense on long-term debt is reported in the Statement of Activities, but do not require the use of current financial resources. Therefore, interest is reported as an expenditure in governmental funds. This amount represents the change in accrued interest from the prior year. 3,509 Claims and judgment changes reported in the Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. (114,731) Compensated absences were reported in the Government-Wide Statement of Activities, but they do not require the use of current financial resources. Therefore, compensated absences were not reported as expenditures in the governmental funds. 59,287 Certain pension income (expenses) reported in the Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds, net of contribution made after the measurement period in the amount of $5,218,453. (1,201,521) Certain other postemployment benefits income (expenses) reported in the Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds, net of contribution made after the measurement period in the amount of $990,171. 956,090
Revenues reported as unavailable revenue in the governmental funds and recognized in the Statement of Activities. (238,443)
Internal Service Funds are used by management to charge the costs of certain activities, such as insurance and equipment replacement, to individual funds. The net revenue of the Internal Service Funds is reported in governmental activities. (191,581)

Change in net position of governmental activities $ 5,149,067 Governmental activities in the Statement of Activities were reported differently because:

City of Seal Beach
Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, For the Year Ended June 30, 2024
and Changes in Fund Balances to the Government-Wide Statement of Activities See accompanying Notes to the Basic Financial Statements 28 PROPRIETARY FUND FINANCIAL STATEMENTS
29 Governmental
Activities
Internal
Water Utility Sewer Utility Total Service Funds
ASSETS
Current Assets:

Cash and investments 6,417,613 $ 11,853,252 $ 18,270,865 $ 159,245 $ Accounts receivable 462,319 957,673 1,419,992 14,612
Prepaid items 23,214 23,214 46,428 -
Total current assets 12,338,785 7,398,500 19,737,285 173,857 Noncurrent Assets:

Restricted cash 25,082 - 25,082 -
Capital assets, not being depreciated 2,660,703 617,088 3,277,791 - Capital assets, net of accumulated depreciation 14, 16,010,113 255,515 30,265,628 582,469 Intangible assets, net of accumulated amortization 90,853 111,118 201,971 200,390 Total capital assets 17,027,336 16,718,054 33,745,390 782,859 Total noncurrent assets 16,718,054 17,052,418 33,770,472 782,859 Total Assets 29,056,839 24,450,918 53,507,757 956,716

DEFERRED OUTFLOWS OF RESOURCES
Deferred charges on refunding - 60,352 60,352 -
Pension related items 966,422 622,327 1,588,749 -
Other postemployment benefits related items 439,384 354,228 793,612 - Total deferred outflows of resources 1,036,907 1,405,806 2,442,713 - (Continued)
Enterprise Funds
June 30, 2024
Proprietary Funds
Statement of Net Position
City of Seal Beach
Business-Type Activities
See accompanying Notes to the Basic Financial Statements 30 Governmental
Activities
Internal
Water Utility Sewer Utility Total Service Funds

LIABILITIES
Current Liabilities:

Accounts payable 1,394,138 26,530 1,420,668 11,619
Accrued liabilities 29,953 22,901 52,854 -
Accrued interest 713 40,736 41,449 -
Retention payable 36,802 - 36,802 -
Deposits payable 181,108 9,570 190,678 -
Compensated absences, due within one year 7,005 21,958 28,963 - Long-term debt, due within one year 170,405 467,028 637,433 81,803 Total current liabilities 588,723 1,820,124 2,408,847 93,422 Noncurrent Liabilities:

Compensated absences, due in more than one year 55,920 42,266 98,186 - Long-term debt, due in more than one year 296,997 2,950,379 3,247,376 125,423 Net pension liabilities 2,563,267 1,650,616 4,213,883 - Net other postemployment benefits liabilities 781,149 629,755 1,410,904 - Total noncurrent liabilities 5,273,016 3,697,333 8,970,349 125,423 Total liabilities 5,861,739 5,517,457 11,379,196 218,845

DEFERRED INFLOW OF RESOURCES
Pension related items 148,165 95,411 243,576 -
Other postemployment benefits related items 440,060 354,773 794,833 - Total deferred inflows of resources 450,184 588,225 1,038,409 -

NET POSITION
Net investment in capital assets 16,523,132 13,360,999 29,884,131 575,633 Restricted for debt service 25,082 - 25,082 -
Unrestricted 3,202,828 10,420,824 13,623,652 162,238
Total net position $ 23,781,823 19,751,042 $ 43,532,865 $ 737,871 $ (Concluded)
Enterprise Funds
City of Seal Beach
Statement of Net Position (Continued)
Proprietary Funds
June 30, 2024
Business-Type Activities
See accompanying Notes to the Basic Financial Statements 31 This page intentionally left blank.
32 Governmental
Activities
Internal
Water Utility Sewer Utility Total Service Funds
OPERATING REVENUES:

Sales and service charges 6,286,928 $ 2,421,972 $ 8,708,900 $ 137,000 $ Miscellaneous 2,384 898 3,282 -
Total operating revenues 2,422,870 6,289,312 8,712,182 137,000 OPERATING EXPENSES:

Personnel expenses 2,017,372 1,451,293 3,468,665 -
Operating expenses 4,572,127 769,267 5,341,394 60,511
Amortization and depreciation expenses 528,399 996,493 1,524,892 266,364 Total operating expenses 3,217,053 7,117,898 10,334,951 326,875 Operating loss (794,183) (828,586) (1,622,769) (189,875) NONOPERATING INCOME (LOSS):

Interest revenues 143,506 257,771 401,277 -
Interest expenses (9,941) (136,337) (146,278) (3,765)
Loss on sale of assets - - - 2,059
Total nonoperating income (loss) 121,434 133,565 254,999 (1,706) Changes in net position (672,749) (695,021) (1,367,770) (191,581) NET POSITION:

Beginning of year, as restated (Note 15) 20,446,063 24,454,572 44,900,635 929,452 End of year 19,751,042 $ 23,781,823 $ 43,532,865 $ 737,871 $ Enterprise Funds
Business-Type Activities
For the Year Ended June 30, 2024
Statement of Revenues, Expenses, and Changes in Net Position City of Seal Beach
Proprietary Funds
See accompanying Notes to the Basic Financial Statements 33 Governmental
Activities
Internal
Water Utility Sewer Utility Total Service Funds
CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from customers and users 6,099,775 $ 2,356,164 $ 8,455,939 $ 122,388 $ Cash paid to suppliers for goods and services (893,068) (4,236,255) (5,129,323) (78,342) Cash paid to employees for services (1,704,177) (1,018,847) (2,723,024) - Net cash provided by operating activities 444,249 159,343 603,592 44,046

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Acquisition of capital assets (83,098) (640,064) (723,162) - Proceed on disposal of assets - - - 15,403
Principal paid on long-term liabilities (84,857) (450,660) (535,517) (80,587) Interest paid on long-term liabilities (10,004) (128,558) (138,562) (3,765) Net cash used in capital and
related financing activities (662,316) (734,925) (1,397,241) (68,949)

CASH FLOWS FROM INVESTING
ACTIVITIES:

Interest received 143,506 257,771 401,277 -
Net cash provided by investing activities 257,771 143,506 401,277 - Net change in cash and cash equivalents 39,704 (432,076) (392,372) (24,903) CASH AND CASH EQUIVALENTS:

Beginning of year 6,874,771 11,813,548 18,688,319 184,148 End of year $ 11,853,252 6,442,695 $ 18,295,947 $ 159,245 $

RECONCILIATION OF CASH AND CASH
EQUIVALENTS:

Cash and investments 6,417,613 $ 11,853,252 $ 18,270,865 $ 159,245 $ Restricted cash 25,082 - 25,082 -
Total cash and cash equivalents $ 11,853,252 6,442,695 $ 18,295,947 $ 159,245 $ (Continued)
Enterprise Funds
City of Seal Beach
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2024
Business-Type Activities
See accompanying Notes to the Basic Financial Statements 34 Governmental
Activities
Internal
Water Utility Sewer Utility Total Service Funds
Reconciliation of Operating Income (Loss) to
to Net Cash Provided by Operating Activities:

Operating income (loss) (828,586) $ (794,183) $ (1,622,769) (189,875) $ Adjustments to reconcile operating income
(loss) to net cash provided by (used in)
operating activities:

Amortization and depreciation expenses 528,399 996,493 1,524,892 266,364 Changes in assets and liabilities:
(Increase)/decrease in accounts receivables (203,616) (67,102) (270,718) (14,612) (Increase)/decrease in prepaid items 3,270 (23,214) (19,944) - (Increase)/decrease in deferred outflows of
resources related to pensions 6,946 (31,923) (24,977) - (Increase)/decrease in deferred outflows of
resources related to OPEB (106,473) (152,298) (258,771) - Increase/(decrease) in accounts payable 332,602 (100,587) 232,015 (17,831) Increase/(decrease) in accrued liabilities 6,969 9,164 16,133 - Increase/(decrease) in deposits payable 14,079 396 14,475 - Increase/(decrease) in compensated absences (1,826) 15,101 13,275 - Increase/(decrease) in net pension liabilities 203,839 219,487 423,326 - Increase/(decrease) in net OPEB liabilities (101,519) 94,366 (7,153) - Increase/(decrease) in deferred inflows of
resources related to pensions (92,830) (50,766) (143,596) - Increase/(decrease) in deferred inflows of
resources related to OPEB 398,089 329,315 727,404 -
Net cash provided by operating activities $ 444,249 159,343 $ 603,592 $ 44,046 $ NONCASH ITEM:

Amortization of deferred charges $ 12,070 - $ 12,070 $ - $ (Concluded)
Enterprise Funds
City of Seal Beach
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2024
Business-Type Activities
See accompanying Notes to the Basic Financial Statements 35 This page intentionally left blank.
36 FIDUCIARY FUND FINANCIAL STATEMENTS
37 This page intentionally left blank.
38 Custodial
Funds
ASSETS
Cash and investments $ 646,737
Receivables:

Accounts 736
Taxes 4,284
Restricted investments with fiscal agent 1,026,002
Total assets 1,677,759

LIABILITIES
Current liabilities:

Interest payable 96,724
Total current liabilities 96,724
Total liabilities 96,724

NET POSITION
Restricted for
Individual, organization and other government $ 1,581,035 Total fiduciary net position
June 30, 2024
Statement of Fiduciary Net Position
City of Seal Beach
Fiduciary Funds
See accompanying Notes to the Basic Financial Statements 39 Custodial
Funds
ADDITIONS:

Assessment revenue collected $ 836,110
Investment income 59,744
Total additions 895,854
DEDUCTIONS:

Return of deposits 12,939
Payment of special assessment district debt service 816,632 Total deductions 829,571
Change in net position 66,283
NET POSITION:

Beginning of year 1,514,752
End of year $ 1,581,035
City of Seal Beach
Statement of Change in Fiduciary Net Position
Fiduciary Funds
For the Year Ended June 30, 2024
See accompanying Notes to the Basic Financial Statements. 40 41

NOTES TO THE BASIC FINANCIAL STATEMENTS
42 This page intentionally left blank.

City of Seal Beach
Index to the Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
43 Page
Note 1 – Summary of Significant Accounting Policies ..................................................................................... 45 A. Financial Reporting Entity .............................................................................................................. 45 B. Basis of Accounting and Measurement Focus ................................................................................ 46 C. Cash and Investments ..................................................................................................................... 48 D. Fair Value Measurement ................................................................................................................. 49 E. Property Taxes Receivable ............................................................................................................. 49 F. Lease Receivable ............................................................................................................................ 49 G. Prepaid Items .................................................................................................................................. 50 H. Interfund Transactions .................................................................................................................... 50 I. Capital Assets ................................................................................................................................. 50 J. Unearned and Unavailable Revenue ............................................................................................... 51 K. Compensated Absences Payable ..................................................................................................... 51 L. Claims Payable ............................................................................................................................... 52 M. Pensions .......................................................................................................................................... 52 N. Other Postemployment Benefits ..................................................................................................... 52 O. Deferred Outflows/Inflows of Resources ....................................................................................... 53 P. Long-Term Liabilities ..................................................................................................................... 53 Q. Lease Liabilities .............................................................................................................................. 53 R. Subscription Liabilities ................................................................................................................... 54 S. Net Position .................................................................................................................................... 54 T. Fund Balances ................................................................................................................................. 55 U. Use of Estimates ............................................................................................................................. 56 V. Tax Abatement ................................................................................................................................ 56 W. Implementation of New GASB Pronouncements ........................................................................... 56 Note 2 – Cash and Investments .......................................................................................................................... 56 A. Demand Deposits ............................................................................................................................ 57 B. Investments Authorized by the California Government Code and the City's Investment Policy ................................................................................................................. 57 C. Investments Authorized by Debt Agreements ................................................................................ 58 D. Fair Value Measurement ................................................................................................................. 58 E. Risk Disclosures ............................................................................................................................. 59 F. Investment in Local Agency Investment Fund (“LAIF”) ............................................................... 61 Note 3 – Lease Receivable ................................................................................................................................... 61 Note 4 – Interfund Transactions ........................................................................................................................ 62 A. Due From/To Other Funds .............................................................................................................. 62 B. Transfers ......................................................................................................................................... 62 Note 5 – Capital Assets ........................................................................................................................................ 63 Note 6 – Long-Term Liabilities .......................................................................................................................... 65 A. Governmental Activities ................................................................................................................. 65 B. Business-Type Activities ................................................................................................................ 67 City of Seal Beach
Index to the Notes to the Basic Financial Statements (Continued) For the Year Ended June 30, 2024
44 Page
Note 7 – Non-City Obligations ........................................................................................................................... 70 A. Heron Pointe Community Facilities District No. 2002-01 ............................................................ 70 B. Pacific Gateway Business Center Community Facilities District No. 2005-01 ............................ 70 Note 8 – Risk Management and Self Insurance Program ............................................................................... 70 A. Description of Self-Insurance Pool Pursuant to Joint Powers Agreement ..................................... 70 B. Primary Self-Insurance Programs of the Authority ....................................................................... 70 C. Purchased Insurance ...................................................................................................................... 71 D. Adequacy of Protection ................................................................................................................. 72 E. Claims Activity .............................................................................................................................. 72 Note 9 – Defined Benefit Pension Plans ............................................................................................................ 72 A. General Information about the Pension Plan ................................................................................. 72 B. Pension Liabilities, Pension Expenses, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pension ............................................................. 75 Note 10 – Other Postemployment Benefits (“OPEB”) Plan ............................................................................ 79 A. General Information about the OPEB Plan .................................................................................... 79 B. Net OPEB Liability ........................................................................................................................ 80 C. Changes in the Net OPEB Liability ............................................................................................... 81 D. OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB ................................................................................................... 82 Note 11 – Net Investment in Capital Assets ...................................................................................................... 83 Note 12 – Classification of Fund Balances ........................................................................................................ 84 Note 13 – Commitments and Contingencies ..................................................................................................... 85 A. Commitments ................................................................................................................................. 85 B. Contingencies ................................................................................................................................ 85 C. Grants ............................................................................................................................................. 85 Note 14 – Individual Fund Disclosure ............................................................................................................... 85 Note 15 – Prior Period Adjustments ................................................................................................................. 86 A. Government-Wide Financial Statements ....................................................................................... 86 B. Governmental Fund Financial Statements ..................................................................................... 86 C. Enterprise Fund Financial Statements ........................................................................................... 86 D. Internal Service Fund Financial Statements .................................................................................. 86 City of Seal Beach
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
45 Note 1 – Summary of Significant Accounting Policies
The basic financial statements of the City of Seal Beach, California, (the “City”) have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) as applied to governmental agencies. The Governmental Accounting Standards Board (“GASB”) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The following is a summary of the City’s significant policies:

A. Financial Reporting Entity
The City was incorporated on October 27, 1915, under the laws of the State of California and enjoys all the rights and privileges applicable to a charter city. It is governed by an elected five-member council. As required by U.S.

GAAP these financial statements present the City (the primary government and its component units). The component units discussed below are included in the reporting entity because of their operational or financial relationships with the City.

In evaluating how to define the City for financial reporting purposes, management has considered all potential component units. The primary criteria for including a potential component unit within the reporting entity are the governing body’s financial accountability and a financial benefit or burden relationship and whether it is misleading to exclude. A primary government is financially accountable and shares a financial benefit or burden relationship, if it appoints a voting majority of an organization’s governing body and it is able to impose its will on the organization, or if there is a potential for the organization to provide specific financial benefits to, or impose specific financial burdens on the primary government. A primary government may also be financially accountable if an organization is fiscally dependent on the primary government regardless of whether the organization has a separately elected governing board, a governing board appointed by a higher level of government, or a jointly appointed board, and there is a potential for the organization to provide specific financial benefits to, or impose specific financial burdens on the primary government.

Blended Component Units
Management determined that the following entities should be reported as blended component units based on the criteria above. Although the following entities are legally separate from the City, they have been “blended” as though they are part of the City because the component units’ governing bodies are substantially the same as the City’s and there is a financial benefit or burden relationship between the City and the component units; and 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 exclusively, benefits the City, even though they do not provide services directly to it.

The Seal Beach Public Financing Authority (the “Authority”) was formed May 8, 2000, pursuant to Articles 1 through 4 of Chapter 5, Division 7, Title 1 of the California Government Code, to create a joint exercise of powers authority between the City and the former Seal Beach Redevelopment Agency. The City Council of the City is the governing board. Management of the primary government has operational responsibility for the blended component unit. The Authority was formed to undertake the financing of public capital improvements.

On June 12, 2017, the City Council adopted Resolution No. 6741, to create the Parking Authority, and the Parking Authority became a new member to the Authority. On the same date, the Successor Agency Board of Directors adopted Resolution No. SA 17-3, approving the Successor Agency’s withdrawal of its Authority membership. On June 28, 2017, the Oversight Board to the Successor Agency adopted Resolution No. OB17-03, approving such withdrawal. Resolution No. OB17-03 became effective upon the State of California Department of Finance’s approval, received by the Successor Agency on August 18, 2017. The Authority does not issue separate financial statements.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
46 Note 1 – Summary of Significant Accounting Policies (Continued) A. Financial Reporting Entity (Continued)
Blended Component Units (Continued)
The Seal Beach Parking Authority (the “Parking Authority”) was formed on June 12, 2017, pursuant to the Part 2 of Division 18 of the California Streets and Highway Code. The Parking Authority is governed by the Board of Directors which is the City Council of the City of Seal Beach. The Parking Authority is blended into the general fund. The Parking Authority does not issue separate financial statements.

The Seal Beach Cable Communications Foundation (the “Foundation”) was organized under the laws of the State of California on August 27, 1984, to foster and promote civic advancement through activities related to cable communications, community promotion, and other public services deemed appropriate by the foundation. The Foundation is governed by a board of directors consisting of seven members, all appointed by the City Council of the City of Seal Beach. The Foundation is blended with the City as a special revenue fund. The Foundation does not issue separate financial statements.

B. Basis of Accounting and Measurement Focus
The accounts of the City are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for by providing a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures or expenses, as appropriate. City resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled.

Government-Wide Financial Statements
The government-wide financial statements are presented on an “economic resources” measurement focus and the accrual basis of accounting. Accordingly, all of the City’s assets, deferred outflows of resources, liabilities, and deferred inflows of resources, including capital assets, as well as infrastructure assets, and long-term liabilities, are included in the accompanying Statement of Net Position. The Statement of Activities presents changes in net position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred. Fiduciary activities of the City are not included in these statements.

Certain types of transactions are reported as program revenues for the City in three categories:
 Charges for services
 Operating grants and contributions
 Capital grants and contributions
Certain eliminations have been made in regards to interfund activities, payables and receivables. All internal balances in the statement of net position have been eliminated. In the statement of activities, internal service fund transactions have been included in the governmental activities. The following interfund activities have been eliminated:
 Due from and to other funds, which are short-term loans within the primary government  Except between Governmental and Business-Type Activities, transfers in and out, which are flows of assets between funds without the requirement for repayment City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
47 Note 1 – Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus (Continued) Governmental Fund Financial Statements (Continued)
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, current liabilities, and deferred inflows of resources are included on the balance sheet. The statement of revenues, expenditures and changes in fund balances presents increases (revenue and other financing sources) and decreases (expenditures and other financing uses) in fund balances. Under the modified accrual basis of accounting, revenues are recognized in the accounting period in which they become both measurable and available to finance expenditures of the current period.

Revenues are recorded when received in cash, except those revenues subject to accrual (generally 60 days after year-end) which are recognized when measurable and available. The primary revenue sources that have been treated as susceptible to accrual by the City are property taxes, intergovernmental revenues and other taxes.

Business license fees are recorded as received. Expenditures are recorded in the accounting period in which the related fund liability is incurred. An exception to this general rule is principal and interest on long-term debt which is recognized when due.

Reconciliations of the fund financial statements to the government-wide financial statements are provided to explain the differences.

The City reports the following major Governmental Funds:

General Fund – The General Fund is the City’s principal operating fund. It accounts for all revenues and expenditures used to finance the traditional services associated with a municipal government except those required to be accounted for in another fund.

Citywide Grants Special Revenue Fund – The Citywide Grants Special Revenue Fund is used to account for various Federal and State grants that are restricted to expenditures for specific projects or purposes.

Capital Projects and Equipment Capital Projects Fund – To account for major capital projects with various revenues sources but exclude the Water and Sewer Capital Improvement Fund. These sources get transferred into the Capital Projects and Equipment Projects Fund.

Proprietary Fund Financial Statements
Proprietary Fund Financial Statements include a Statement of Net Position, a Statement of Revenues, Expenses and Changes in Net Position, and a Statement of Cash Flows for each major Proprietary Fund.

Proprietary funds are accounted for using the "economic resources" measurement focus and the accrual basis of accounting. Accordingly, all assets, deferred outflows of resources, liabilities (whether current or noncurrent), and deferred inflows of resources are included on the Statement of Net Position. The Statement of Revenues, Expenses and Changes in Fund Net Position presents increases (revenues) and decreases (expenses) in total Net Position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred. In these funds, receivables have been recorded as revenue and provisions have been made for uncollectible amounts.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
48 Note 1 – Summary of Significant Accounting Policies (Continued) B. Basis of Accounting and Measurement Focus (Continued) Proprietary Fund Financial Statements (Continued)
Operating revenues in the proprietary funds are those revenues that are generated from the primary operations of the fund. All other revenues are reported as non-operating revenues. Operating expenses are those expenses that are essential to the primary operations of the fund. All other expenses are reported as non-operating expenses.

The City reports the following major Proprietary Funds:

Water Utility Enterprise Fund – This fund accounts for the capital, operation and maintenance of the City’s water distribution system.

Sewer Utility Enterprise Fund – This fund accounts for the financial transactions of the City’s wastewater collection system.

A separate column representing internal service funds is also presented in these statements. However, internal service balances and activities have been combined with the governmental activities in the Government-Wide Financial Statements. The City has a Vehicle Replacement Internal Service Fund and an Information Technology Internal Service Fund that provides services directly to other City funds.

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 custodial funds. The custodial funds are accounted for on the full accrual basis of accounting where the assets associated with the activity are controlled by the City and the assets are not derived 1) solely from the government’s own-source revenues or 2) from government-mandated nonexchange transactions or voluntary nonexchange transactions.

The City reports the following fiduciary fund:

Custodial Funds – To accounts for assets for the benefit of individuals and the City does not have administrative involvement with the assets or direct financial involvement with the assets or for the benefit of organizations or other governments that are not part of the City. In addition, the assets are not derived from the City’s provision of goods or services to those individuals, organizations, or other governments. The custodial funds account for the deposits for individuals and organizations and the debt service and related expenses for the Heron Pointe and Pacific Gateway Community Facility Districts.

C. Cash and Investments
The City’s cash and cash equivalents are comprised of cash on hand, demand deposits, and short-term investments with original maturity of three months or less from the date of acquisition. All cash and investments of proprietary funds are held in the City’s investment pool. These cash pools have the general characteristics of a demand deposit account, therefore, all cash and investments in the proprietary funds are considered cash and cash equivalents for statement of cash flows purposes.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
49 Note 1 – Summary of Significant Accounting Policies (Continued) D. Fair Value Measurement
Investments, unless otherwise specified, recorded at fair value in the financial statements, are categorized based upon the level of judgment associated with the inputs used to measure their fair value.

The three levels of the fair value measurement hierarchy are described below:
 Level 1 – Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date.
 Level 2 – Inputs, other than quoted prices included in Level 1, that are observable for the assets or liabilities through corroboration with market data at the measurement date.  Level 3 – Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the assets or liabilities at the measurement date.

E. Property Taxes Receivable
Property tax revenue is recognized in the fiscal year for which the taxes have been levied providing they become available. Available means due, or past due and receivable within the current period and collected within the current period or expected to be collected soon enough thereafter (not to exceed 60 days) to be used to pay liabilities in the current period.

Under California law, property taxes are assessed and collected by the counties at up to 1% of assessed value, plus other increases approved by the voters. The property taxes go into a pool, and are then allocated to the cities based on complex formulas.

The property tax calendar is as follows:

Lien Date: January 1
Levy Date: July 1
Due Date: First Installment - November 1
Second Installment - February 1
Delinquent Date: First Installment - December 11
Second Installment - April 11
F. Lease Receivable
The City is a lessor for leases of land and buildings 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. The City established a threshold of $50,000 for lease receivables. Subsequently, the lease receivable 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. The City used the interest method of revenue recognition.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
50 Note 1 – Summary of Significant Accounting Policies (Continued) F. Lease Receivable (Continued)
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 incremental borrowing rate (IBR) provided by the 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 are 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.

G. Prepaid Items
Prepaid items are payments made to vendors for services that will benefit periods beyond the fiscal year ended.

The City uses the consumption method to account for prepaid items.

H. Interfund Transactions
Transactions between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as “due from/to other funds” (i.e., current portion of interfund loans). These are typically routine and temporary cash flow assistance from the General Fund to other funds in advance of receiving grant funds or other types of revenue.

Transactions which move resources from a fund receiving revenue to the fund through which the resources are expended are recorded as transfers.

I. Capital Assets
Capital assets, which include land, buildings, improvements, equipment, furniture, and infrastructure assets (e.g., roads, sidewalks, and similar items), are recorded at historical cost or estimated historical if purchased or constructed. Donated capital assets are valued at the estimated acquisition value on the date donated. City policy has set the capitalization threshold for reporting capital assets with an initial, individual cost of more than $5,000 and an estimated useful life of one year or more.

The City defines infrastructure as the basic physical assets that allow the City to function. The assets include street network, street appurtenances, and storm drains.

Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business-type activities is included as part of the capitalized value of the assets constructed. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
51 Note 1 – Summary of Significant Accounting Policies (Continued) I. Capital Assets (Continued)
The City established a threshold to recognize a right-to-use including lease asset or subscription-based information technology arrangements (“SBITA”) asset (“subscription assets”) in the government-wide financial statements and proprietary fund financial statements right-to-use asset over $5,000.

Lease assets are recorded at the amount of the initial measurement of the lease liabilities and adjusted by any lease payments made to the lessor at or before the commencement of the lease term, less any lease incentives received at or before the commencement of the lease term along with any initial direct costs that are ancillary charges necessary to place the lease assets into service. Lease assets are amortized using the straight-line method over the shorter of the lease term or the useful life of the underlying asset, unless the lease contains a purchase option that the City has determined is reasonably certain of being exercised. In this case, the lease asset is amortized over the useful life of the underlying asset.

Subscription assets are recorded at the amount of the initial measurement of the SBITA liabilities (“subscription liabilities”) and adjusted by any subscription payments to the SBITA vendor at or before the commencement of the subscription term, less any incentives received from the SBITA vendor at or before the commencement of the subscription term along with subscription implementation costs. Subscription assets are amortized over the shorter of the subscription term or the useful life of the underlying IT assets.

All other capital assets used in operations are depreciated over their estimated useful using the straight-line method. The lives used for depreciation purposes are as follows:

Assets Years
Building and Improvements 20-99
Machinery and Equipment 5-50
Vehicles 4-10
Infrastructure 20-60
J. Unearned and Unavailable Revenue
Unearned revenue is reported for transactions for which revenue has not yet been earned. Typical transactions recorded as unearned revenues in the government-wide and fund financial statements are grant revenues received in advance.

In the governmental fund financial statements, unavailable revenue is reported when transactions have not yet met the revenue recognition criteria based on the modified accrual basis of accounting. The City reports unavailable revenue when an asset is reported in governmental fund financial statements but the revenue is not collected within the availability period (within 60 days of year-end).

K. Compensated Absences Payable
City employees have vested interest in varying levels of vacation, sick leave and compensatory time based on their length of employment. It is the policy of the City to pay all accumulated vacation pay and all or a portion of sick pay when an employee retires or terminates. The long-term amount is included as a liability in the governmental activities of the government-wide financial statements. A liability for these amounts is reported in governmental funds only if they have matured, for example, as a result of employee resignations and retirements.

All of the liability for compensated absences applicable to proprietary funds is reported in those funds.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
52 Note 1 – Summary of Significant Accounting Policies (Continued) L. Claims Payable
When it is probable that a claim liability has been incurred at year-end and the amount of the loss can be reasonably estimated, the City records the estimated loss, net of any insurance coverage under its selfinsurance program. Small dollar claims and judgments are recorded as expenditures when paid.

The City's self-insurance program is administered through California Joint Powers Insurance Authority (CJPIA), which is described in Note 8 to the financial statements. The Authority is a public entity risk pool.

Claims losses recorded in the Authority include both current claims and incurred but not reported claims (IBNR).

Deposits to the Authority are recorded by the City as insurance expenditures in the General Fund when paid.

These deposits are subject to retrospective adjustment. Favorable claims experience in prior years results in a refund of deposits from the Authority and such refunds, if any, are recorded as prepaid items in the General Fund since they will be used to offset future deposit requirements. Adverse claims experience in prior years results in the payment of additional deposits and such deposits, if any, are recorded as insurance expenditures when incurred.

M. Pensions
For purposes of measuring the aggregate net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary 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:

Valuation Date June 30, 2022
Measurement Date June 30, 2023
Measurement Period July 1, 2022 to June 30, 2023
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. 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, inactive, and retired) as of the beginning of the measurement period.

Pension liabilities are liquidated principally by General Fund for the governmental activities.

N. Other Postemployment Benefits
For purposes of measuring the net other postemployment benefits (“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 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 are recognized when due and payable in accordance with benefit terms. Investments are reported at fair value.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
53 Note 1 – Summary of Significant Accounting Policies (Continued) N. Other Postemployment Benefits (Continued)
The following timeframes are used for OPEB reporting:

Valuation Date June 30, 2023
Measurement Date June 30, 2023
Measurement Period July 1, 2022 to June 30, 2023
Gains and losses related to changes in total OPEB liability 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 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, inactive, and retired) as of the beginning of the measurement period.

OPEB liabilities are liquidated principally by General Fund for the governmental activities.

O. Deferred Outflows/Inflows of Resources
The financial statements report separate sections for deferred outflows of resources, and deferred inflows of resources, when applicable.

Deferred Outflows of Resources represent a consumption of net assets that applies to future periods.

Deferred Inflows of Resources represent an acquisition of net assets that applies to future period.

P. Long-Term Liabilities
Long-term debt and other long-term liabilities are reported as liabilities in the Statement of Net Position. Bond premiums and discounts are deferred and amortized over the life of the bonds using the effective interest method.

Bonds payable are reported net of the applicable bond premium or discount.

Q. Lease Liabilities
The City recognizes lease liabilities with an initial, individual value of $5,000 or more with a lease term greater than one year in the government-wide and proprietary fund financial statements. Variable payments based on future performance of the lessee or usage of the underlying asset are not included in the measurement of the lease liability.

At the commencement of a lease, the City initially measures the lease liability at the present value of payments expected to be made during the lease term. Subsequently, the lease liability is reduced by the principal portion of lease payments made.

Key estimates and judgments related to leases include how the City determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) lease payments.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
54 Note 1 – Summary of Significant Accounting Policies (Continued) Q. Lease Liabilities (Continued)
 The City uses incremental borrowing rate provided by the financial institution or the current rate at the time a new lease is executed.
 The lease term includes the noncancellable period of the lease. Lease payments included in the measurement of the lease liability are composed of fixed payments and purchase option price that the City is reasonably certain to exercise.
 Lease payments included in the measurement of the lease payable is composed of fixed payments to the lessor.

The City monitors changes in circumstances that would require a remeasurement of its lease and will remeasure any lease asset and liability if certain changes occur that are expected to significantly affect the amount of the lease liability.

R. Subscription Liabilities
The City recognizes subscription liabilities with an initial, individual value of $5,000 or more with a subscription term greater than one year in the government-wide and proprietary fund financial statements. Variable payments based on future performance of the City, usage of the underlying IT assets, or number of user seats are not included in the measurement of the subscription liability.

At the commencement of a subscription, the City initially measures the subscription liability at the present value of payments expected to be made during the subscription term. Subsequently, the subscription liability is reduced by the principal portion of subscription payments made.

Key estimates and judgments related to subscription liabilities include how the City determines (1) the discount rate it uses to discount the expected subscription payments to present value, (2) subscription term, and (3) subscription payments.
 The City uses incremental borrowing rate provided by the financial institution at July 1, 2022 for existing subscription or the current rate at the time a new subscription is executed.  The subscription term includes the noncancellable period of the SBITA. Subscription payments included in the measurement of the subscription liability are composed of fixed payments.

The City monitors changes in circumstances that would require a remeasurement of its SBITA and will remeasure any subscription asset and liability if certain changes occur that are expected to significantly affect the amount of the subscription liability.

S. Net Position
In the government-wide financial statements and proprietary fund financial statements, net position is classified as follows:

Net Investment in Capital Assets – This component of net position consists of capital assets, net of accumulated depreciation, capital related debt, deferred charges, and retention payable.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
55 Note 1 – Summary of Significant Accounting Policies (Continued) S. Net Position (Continued)
Restricted – This component of net position consists of restricted assets reduced by liabilities and deferred inflows of resources related to those assets.

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

When expenses are incurred for purposes for which both restricted and unrestricted components of net position are available, the City’s practice is to apply the restricted component of net position first, then use the unrestricted component of net position as needed.

T. Fund Balances
In the governmental fund financial statements, fund balances are classified as follows:

Nonspendable – Nonspendable fund balances include amounts that cannot be spent because they are not in a spendable form, such as unrestricted loans receivable or prepaid items, or because resources legally or contractually must remain intact.

Restricted – Restricted fund balances are the portion of fund balance that have externally enforceable limitations on their usage through legislation or limitations imposed by creditors, grantor, laws and regulations of other governments or enabling legislation.

Committed – Committed fund balances are self-imposed limitations by the highest level of decision-making authority, namely the City Council, prior to the end of the reporting period. City Council adoption of a resolution is required to commit resources or to rescind the commitment.

Assigned – Assigned fund balances are limitations imposed by management based on the intended use of the funds. Modifications or rescissions of the constraints can be removed by the same type of action that limited the use of the funds. Assignment of resources can be done by the highest level of decision making or by a committee or official designated for that purpose. The City Council has authorized the Finance Director for that purpose.

Unassigned – Unassigned fund balances represent the residual net resources in excess of the other classifications. The General Fund is the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it is not appropriate to report a positive unassigned fund balance amount. However, in governmental funds other than General Fund, if expenditures incurred for specific purposes exceed the amounts that are restricted, committed, or assigned to those purposes, it may be necessary to report a negative unassigned fund balance in that fund.

When expenditures are incurred for purposes for which both restricted and unrestricted fund balances are available, the City’s practice is to apply restricted fund balances first, then use unrestricted fund balances as needed.

When expenditures are incurred for purposes where only unrestricted fund balances are available, the City uses the unrestricted resources in the following order, except for instances wherein an ordinance specifies the fund balance: committed, assigned, then unassigned.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
56 Note 1 – Summary of Significant Accounting Policies (Continued) U. Use of Estimates
The preparation of the basic financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

V. Tax Abatement
Tax abatement is a reduction in tax revenues that results from an agreement between one or more governments and an individual or entity in which (a) one or more governments promise to forgo tax revenues to which they are otherwise entitled and (b) the individual or entity promises to take a specific action after the agreement has been entered into that contributes to economic development or otherwise benefits the governments or the citizens of those governments. City policy has set the threshold for disclosing tax abatement agreements greater than $50,000.

W. Implementation of New GASB Pronouncements
During fiscal year ended June 30, 2024, the City has implemented the following new GASB Pronouncements:

GASB Statement No. 100 – In June 2022, GASB issued Statement No. 100, Accounting Changes and Error Corrections – an Amendment of GASB Statement No. 62. The primary objective of this Statement is to enhance accounting and financial reporting requirements for accounting changes and error corrections to provide more understandable, reliable, relevant, consistent, and comparable information for making decisions or assessing accountability.

Note 2 – Cash and Investments
The City maintains a cash and investment pool, which includes cash balances and authorized investments of all funds.

The City had the following cash and investments at June 30, 2024:

Government-Wide Statement of
Statement of Fiduciary
Net Position Net Position Total
Cash and investments 61,867,345 $ 646,737 $ 62,514,082 $ Restricted cash and investment
with fiscal agent 36,429 1,026,002 1,062,431
Total cash and investments 61,903,774 $ 1,672,739 $ 63,576,513 $ The City’s cash and investments at June 30, 2024 in more detail:

Petty cash 9,000 $
Demand deposits 1,707,073
Restricted cash 36,429
Investments 61,824,011
Total cash and investments 63,576,513 $
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
57 Note 2 – Cash and Investments (Continued)
A. Demand Deposits
The carrying amounts of the City’s demand deposits were $1,707,073 at June 30, 2024. Bank balances at that date were $2,223,911, the total amount of which was insured or collateralized with accounts held by the pledging financial institutions in the City’s name as discussed below.

The California Government Code requires California banks and savings and loan associations to secure the City’s cash deposits by pledging securities as collateral. This Code states that collateral pledged in this manner shall have the effect of perfecting a security interest in such collateral superior to those of a general creditor. Thus, collateral for cash deposits is considered to be held in the City’s name.

The fair value of pledged securities must equal at least 110% of the City’s cash deposits. California law also allows institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the City’s total cash deposits. The City may waive collateral requirements for cash deposits, which are fully insured up to $250,000 by the Federal Deposit Insurance Corporation (“FDIC”). The City, however, has not waived the collateralization requirements.

B. Investments Authorized by the California Government Code and the City's Investment Policy The table below identifies the investment types that are authorized by the City's investment policy and the California Government Code. The table also identifies certain provisions of the California Government Code (or the City's investment policy, if more restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustee that are governed by the provisions of debt agreements of the City, rather than the general provisions of the California Government Code or the City's investment policy.

Maximum Maximum
Authorized Investment Type Maturity Portfolio* One Issuer* U.S. Treasury securities None 100% None
U.S. agency and U.S. government sponsored
enterprise securities 5 years 20% None
Obligation of the State of California
or any local agency 5 years 100% None
Registered treasury notes or bonds of any
of the 49 states in addition to California 5 years 100% None Bankers' acceptance 180 days 40% 5%
Commercial paper 270 days 25% 10%
Nonnegotiable certificate of deposit 5 years 100% None
Negotiable certificate of deposit 5 years 30% None
Medium term notes 5 years 30% 5%
Asset-Backed Securities 5 years 20% None
Supranationals 5 years 30% None
Money market mutual funds 5 years 20% 5%
Local Agency Investment Fund (LAIF) None 100% 50 Million/account *The table is based on state law requirements or investment policy requirements, whichever is more restrictive.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
58 Note 2 – Cash and Investments (Continued)
C. Investments Authorized by Debt Agreements
Investments of debt proceeds held by bond trustee are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City's investment policy. The following table identifies the investment types that are authorized for investments held by bond trustee. The table also identifies certain provisions of these debt agreements that address interest rate risk, and concentration of credit risk.

Maximum Maximum
Maximum Percentage of Investment in
Authorized Investment Type Maturity Portfolio* One Issuer* U.S. Treasury securities None None None
U.S. agency and U.S. government sponsored
enterprise securities None None None
Bankers' acceptance 180 days None 30%
Commercial paper 270 days None None
Money market mutual funds 5 years None None
Investment contracts 30 years None None
Local Agency Investment Fund (LAIF) None None None
D. Fair Value Measurement
At June 30, 2024, investments are reported at fair value. The following table presents the fair value measurement of investments on a recurring basis and the levels within the fair value hierarchy in which the fair value measurements fall at June 30, 2024:

Quoted Prices in
Active Markets for Significant Other
Identical Assets Observable Inputs
Investment Type Value (Level 1) (Level 2)
Investments:

US Treasury bonds/notes 13,898,614 $ 13,898,614 $ - $
U.S. government sponsored enterprise securities 7,750,014 - 7,750,014 Asset-backed securities 1,412,797 - 1,412,797
Municipal bonds 796,705 - 796,705
Corporate notes 4,457,885 - 4,457,885
Negotiable certificates of deposit 278,960 - 278,960
Bank notes 525,037 - 525,037
Total investments subject to fair value measurement 29,120,012 13,898,614 $ 15,221,398 $ Investments measured at amortized cost:

Local Agency Investment Fund (LAIF) 31,677,998
Investments held with fiscal agents:

Money market funds 1,026,001
Total investments 61,824,011 $
Fair Value Measurement
Investments in municipal bonds/notes, U.S. government sponsored enterprise securities, asset-backed securities and corporate notes are valued based on institutional bond quotes. Investments in negotiable certificates of deposits are valued based on certificate of deposits pricing.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
59 Note 2 – Cash and Investments (Continued)
E. 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. Generally, the longer the maturity of an investment is, the greater the sensitivity of its fair value to changes in market interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of shorter term and longer-term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time as necessary to provide the cash flow and liquidity needed for operations. The sensitivity of the fair values of the City's investments (including investments held by bond trustees) to market interest rate fluctuations is as follows:

Investment Type Amount Less than 1 1 to 2 2 to 3 3 to 4 4 to 5 Investments:

US Treasury bonds/notes 13,898,614 $ $ 6,392,834 - $ 2,607,724 $ 4,026,312 $ 871,744 $ U.S. government sponsored
enterprise securities 7,750,014 2,019,395 149,356 892,278 912,123 3,776,862 Asset-backed securities 1,412,797 18,572 - 247,166 235,056 912,003 Municipal bonds 796,705 262,836 533,869 - - -
Corporate notes 4,457,885 652,166 737,056 974,536 690,685 1,403,442 Negotiable certificates of deposit 278,960 - - 278,960 - - Bank notes 525,037 - - - 525,037 -
LAIF 31,677,998 - 31,677,998 - - -
Investments with Fiscal Agent:

Money market funds 1,026,001 1,026,001 - - - -
Total investments 61,824,011 $ 34,124,280 $ 9,345,803 $ 5,000,664 $ 6,389,213 $ 6,964,051 $ Investment Maturities (in Years)
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
60 Note 2 – Cash and Investments (Continued)
E. Risk Disclosures (Continued)
Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the minimum rating required by (where applicable) the California Government Code or the City's investment policy, or debt agreements, and the actual rating as of fiscal year end for each investment type.

Minimum
Legal
Investment Type Rating Total AAA AA- to AA+ A- to A+ Unrated Investments:

US Treasury bonds/notes N/R 13,898,614 $ $ - 13,898,614 $ - $ - $ U.S. government sponsored
enterprise securities A 7,750,014 - 7,750,014 - -
Asset-backed securities AA 1,412,797 - 1,412,797 - -
Municipal bonds N/R 796,705 605,357 191,348 - -
Corporate notes A 4,457,885 1,051,786 748,133 2,657,966 - Negotiable certificates of deposit N/R 278,960 278,960 - - - Bank notes N/R 525,037 281,977 - 243,060 -
LAIF N/A 31,677,998 - - - 31,677,998
Investments with Fiscal Agent:

Money market funds N/R 1,026,001 - 1,026,001 - -
Total investments 61,824,011 $ 25,026,907 $ 2,218,080 $ 2,901,026 $ 31,677,998 $ N/R - Not required by the City's investment policy
N/A - Not applicable
Concentration of Credit Risk
The investment policy of the City contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code.

Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that in the event of the failure of the counterparty (e.g., broker dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the City's investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits: The California Government Code requires that a financial institution secure deposits made by state or local government units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The fair value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits. At June 30, 2024, the City deposits (bank balances were insured by the Federal Depository Insurance Corporation up to $250,000 and the remaining balances were collateralized under California law.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
61 Note 2 – Cash and Investments (Continued)
E. Risk Disclosures (Continued)
For investments identified herein as held by bond trustee, the bond trustee selects the investment under the terms of the applicable trust agreement, acquires the investment, and holds the investment on behalf of the reporting government.

F. Investment in Local Agency Investment Fund (“LAIF”)
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. As of June 30, 2024, the City had $31,677,998 invested in LAIF. LAIF is reported at amortized cost, which approximates fair value.

Note 3 – Lease Receivable
Lease receivables consists of agreements with other for the right–to–use of the underlying assets for land and buildings owned by the City at various locations for cell tower use and business use, respectively. The remaining terms of the business agreements range from 2 to 34 years and the cell towers range from 3 to 24 years. The incremental borrowing rates used was 1.5%. For the year ended June 30, 2024, the City recognized $342,714 in lease revenue and $155,389 in lease interest revenue for General Fund. The outstanding lease receivable is in the amount of $10,112,627 in the General Fund.

The future receipts for the lease receivables, including interest, are as follows:

Year ending
June 30, Principal Interest Total
2025 355,053 $ 149,865 $ 504,918 $
2026 350,753 144,460 495,213
2027 292,970 139,671 432,641
2028 300,058 135,643 435,701
2029 319,269 130,719 449,988
2030-2034 1,630,227 582,120 2,212,347
2035-2039 2,116,365 442,581 2,558,946
2040-2044 1,692,180 294,602 1,986,782
2045-2049 1,424,852 166,599 1,591,451
2050-2054 947,574 88,824 1,036,398
2055-2058 683,326 16,150 699,476
$ 2,291,234 10,112,627 $ 12,403,861 $
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
62 Note 4 – Interfund Transactions
A. Due From/To Other Funds
At June 30, 2024, the City had the following due from/to other funds:

Due To Other Funds
Fund
Nonmajor Governmental Funds
Total
166,556
Due From Other Funds
General Fund
$ 1,006,816
$ 840,260
The above amounts resulted from deficits in the pooled cash account.

B. Transfers
During the year ended June 30, 2024, the City had the following transfers:

Capital Projects
and Equipment Nonmajor
General Capital Projects Governmental
Transfers out Fund Fund Funds Total
General Fund - $ 3,971,319 $ 442,713 $ 4,414,032 $
Citywide Grants Special
Revenue Fund - 98,305 - 98,305
Nonmajor Governmental Funds - 109,000 - 109,000
Total $ 4,069,624 109,000 $ 442,713 $ 4,621,337 $
Transfers in
Transfers of $109,000 from Nonmajor Governmental Funds were made to the General Fund for non-capital expenditures.

The General Fund and Citywide Grants Special Revenue Fund transferred $3,971,319 and $98,305, respectively, to the Capital Projects and Equipment Capital Projects Fund to pay for capital projects.

The General Fund transferred $442,713 to the Nonmajor Governmental for debt service-related and administrative costs.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
63 Note 5 – Capital Assets
The summary of changes in governmental activities capital assets for the year ended June 30, 2024 is as follows:

Balance
July 1, 2023 Balance
(As Restated) Additions Deletions June 30, 2024
Capital assets not being depreciated:

Land 20,319,847 $ - $ - $ 20,319,847 $
Intangible asset-land easement 900,000 - - 900,000
Construction in progress 3,070,206 5,788,757 - 8,858,963 Total capital assets not being depreciated 24,290,053 5,788,757 - 30,078,810 Capital assets being depreciated:

Buildings and improvements 16,712,471 - - 16,712,471
Machinery and equipment 4,463,872 60,893 (145,557) 4,379,208 Vehicles 3,731,925 165,239 (209,204) 3,687,960
Infrastructure 92,853,900 - - 92,853,900
Total capital assets being depreciated 117,762,168 226,132 (354,761) 117,633,539 Less accumulated depreciation for:

Buildings and improvements (8,462,899) (408,304) - (8,871,203) Machinery and equipment (2,815,664) (235,791) - (3,051,455) Vehicles (2,354,631) (310,609) 212,046 (2,453,194)
Infrastructure (44,102,549) (1,880,523) - (45,983,072)
Total accumulated depreciation (57,735,743) (2,835,227) 212,046 (60,358,924) Total capital assets being depreciated, net 60,026,425 (2,609,095) (142,715) 57,274,615 Intangible assets being amortized:

Right of use - leased vehicles 363,368 - - 363,368
Right of use - leased equipment 110,331 - - 110,331
Righ tof use - subscription asset 949,058 - - 949,058
Total intangible assets being amortized 1,422,757 - - 1,422,757 Less accumulated amortization for:

Right of use - leased vehicles (81,392) (81,586) - (162,978) Right of use - leased equipment (71,566) (35,783) - (107,349) Righ tof use - subscription asset (242,963) (256,302) - (499,265) Total accumulated amortization (395,921) (373,671) - (769,592) Total intangible assets being amortized, net 1,026,836 (373,671) - 653,165 Total governmental activities $ 2,805,991 85,343,314 $ (142,715) $ 88,006,590 $ Depreciation and amortization expense was charged to functions/programs of governmental activities for the year ended June 30, 2024 as follows:

General government 353,822 $
Public safety 446,305
Community development 135,805
Public works 2,006,602
Internal service funds 266,364
Total $ 3,208,898
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
64 Note 5 – Capital Assets (Continued)
The summary of changes in business-type activities capital assets for the year ended June 30, 2024 is as follows:

Balance
July 1, 2023 Balance
(As Restated) Additions Deletions June 30, 2024
Capital assets not being depreciated:

Construction in progress-water 2,258,277 $ 408,760 $ (6,334) $ 2,660,703 $ Construction in progress-sewer 533,989 83,099 - 617,088 Total capital assets not being depreciated 2,792,266 491,859 (6,334) 3,277,791 Capital assets being depreciated:

Buildings and improvements - water 73,284 - - 73,284
Machinery and equipment - water 644,596 - - 644,596
Machinery and equipment - sewer 829,189 - - 829,189
Vehicles - water 297,295 205,732 - 503,027
Vehicles - sewer 382,670 - - 382,670
Infrastructure - water 34,337,305 44,746 - 34,382,051
Infrastructure - sewer 38,622,844 - - 38,622,844
Total capital assets being depreciated 75,187,183 250,478 - 75,437,661 Less accumulated depreciation for:

Buildings and improvements - water (73,284) - - (73,284) Machinery and equipment - water (526,140) (12,793) - (538,933) Machinery and equipment - sewer (330,432) (19,306) - (349,738) Vehicles - water (223,735) (32,783) - (256,518)
Vehicles - sewer (382,670) - - (382,670)
Infrastructure - water (20,043,289) (435,419) - (20,478,708) Infrastructure - sewer (22,149,864) (942,318) - (23,092,182) Total accumulated depreciation (43,729,414) (1,442,619) - (45,172,033) Total capital assets being depreciated, net 31,457,769 (1,192,141) - 30,265,628 Intangible assets being amortized:

Right of use - subscription asset - water 197,421 - - 197,421 Right of use - subscription asset - sewer 159,816 - - 159,816 Total intangible assets being amortized 357,237 - - 357,237 Less accumulated amortization for:

Right of use - subscription asset - water (38,899) (47,404) - (86,303) Right of use - subscription asset - sewer (34,094) (34,869) - (68,963) Total accumulated amortization (72,993) (82,273) - (155,266) Total intangible assets being amortized, net 284,244 (82,273) - 201,971 Total business-type activities $ (782,555) 34,534,279 $ (6,334) $ 33,745,390 $ Depreciation expense was charged to functions/programs of business-type activities for the year ended June 30, 2024 as follows:

Water Utility 528,399 $
Sewer Utility 996,493
Total $ 1,524,892
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
65 Note 6 – Long-Term Liabilities
A. Governmental Activities
Summary of changes in long-term liabilities for governmental activities for the year ended June 30, 2024 is as follows:

Balance
July 1, 2023 Balance Due within Due in more
(As Restated) Additions Deletions June 30, 2024 One Year than One Year Private Placement
2009 Lease Revenue Bonds 315,000 $ - $ (315,000) $ - $ - $ - $ Direct Borrowing
Municipal Finance Corporation 218,963 - (218,963) - - - Lease Liabilities
De Lage Landen 39,298 - (36,252) 3,046 3,046 -
Enterprise Fleet 287,813 - (80,587) 207,226 81,803 125,423 Subscriptions
Subscription liabilities 694,445 - (238,590) 455,855 244,413 211,442 Claims payable 175,046 - (3,843) 171,203 34,241 136,962 Compensated absences 1,395,423 718,642 (659,355) 1,454,710 325,249 1,129,461 Total 3,125,988 $ 718,642 $ (1,552,590) $ 2,292,040 $ 688,752 $ 1,603,288 $ Classification
The General Fund has been used to liquidate the majority of the liability for compensated absences. 2009 Series Lease Revenue Bonds
On January 14, 2009, the City issued 2009 Series Lease Revenue Bonds for the purpose of financing the construction of a new fire station in the City in the amount of $6,300,000. Interest rate on the bonds is 3.71%.

Annual installments are due April 15, 2009 through January 15, 2024. During the year ended June 30, 2024, the bonds were fully paid off.

Municipal Finance Corporation Loan
On May 8, 2014, the City entered into a Lease with Option to Purchase agreement with Municipal Finance Corporation relating to a capital project to be performed by Climatec LLC in the amount of $1,546,931. Interest rate on the loan is 3.40%. During the year ended June 30, 2024, the loan was fully paid off.

De Lage Landen Lease Payable
On August 27, 2019, the City entered into a 60-month lease agreement with De Lage Landen Public Finance LLC for 22 copy machines for a monthly lease payment in the amount of $4,612. Lease payments are due on the 1st of each month. Interest on the copy machines accrues at 1.5% annum. In the event of default, the lease shall be deemed terminated. Outstanding lease liabilities at June 30, 2024 was in the amount of $3,046.

Future lease payments under the lease payable are as follows:

Year Ending
June 30, Principal Interest Total
2025 3,046 $ 4 $ 3,050 $
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
66 Note 6 – Long-Term Liabilities (Continued)
A. Governmental Activities (Continued)
Enterprise Fleet
On October 25, 2021, the City entered into a 60-month lease agreement with Enterprise Fleet Management for 3 vehicles for a total monthly lease payment in the amount of $3,202. As of June 30, 2023 the City leased a total of 6 vehicles with terms of 48-month for a total monthly lease payment in the amount of $7,030. Lease payments are due on the 1st of each month. Interest accrues at 1.5% annum. In the event of default, the lease shall be deemed terminated. Outstanding lease liabilities at June 30, 2024 was in the amount of $207,226.

Future lease payments under the lease payable are as follows:

Year Ending
June 30, Principal Interest Total
2025 81,803 $ 2,548 $ 84,351 $
2026 83,038 1,312 84,350
2027 42,385 190 42,575
Total 207,226 $ 4,050 $ 211,276 $
Subscription Liabilities
The City entered into subscription agreements with various vendors for software. The agreements expire from July 19, 2025 to February 8, 2027 with interest rates ranging 2.35 percent to 2.80 percent. Outstanding subscription liabilities at June 30, 2024 was in the amount of $455,855.

The future subscription payments are as follows:

Year Ending
June 30, Principal Interest Total
2025 244,413 $ 11,326 $ 255,739 $
2026 104,397 5,362 109,759
2027 107,045 2,714 109,759
Total 455,855 $ 19,402 $ 475,257 $
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
67 Note 6 – Long-Term Liabilities (Continued)
B. Business-Type Activities
Summary of changes in long-term liabilities for business-type activities for the year ended June 30, 2024 is as follows:

Balance Balance Due within Due in more
July 1, 2023 Additions Deletions June 30, 2024 One Year than One Year Private Placement
2011 Sewer Revenue Refunding Bonds 1,385,000 $ - $ (205,000) $ 1,180,000 $ 215,000 $ 965,000 $ Direct Borrowing
Sewer Capital Improvement Project #1 1,346,932 - (134,760) 1,212,172 138,264 1,073,908 Sewer Capital Improvement Project #2 1,009,707 - (80,470) 929,237 82,563 846,674 West Orange County Water Board Loan 401,073 - (42,218) 358,855 126,654 232,201 Subscriptions
Subscription liabilities - water - 151,186 (42,639) 108,547 43,751 64,796 Subscription liabilities - sewer - 126,428 (30,430) 95,998 31,201 64,797 Compensated absences 113,874 149,667 (136,392) 127,149 28,963 98,186 Total 4,534,200 $ 149,667 $ (671,909) $ 4,011,958 $ 666,396 $ 3,345,562 $ Classification
2011 Sewer System Revenue Refunding Bonds
On March 2, 2011, the City issued 2011 Sewer System Revenue Refunding Bonds in the amount of $3,310,000 to pay off the 2000 Sewer System Certificates of Participation. The 2000 Sewer System Certificates of Participation were issued to provide for improvements to the City’s sewer system.

Interest rate on the 2011 Sewer System Revenue Refunding Bonds is 4.8%, and the outstanding balance of the 2011 Sewer System Revenue Refunding Bonds at June 30, 2024 was $1,180,000. In the event of a default the City may be required to pay all principal components of the unpaid installment payments, together with accrued interest at the overdue rate from the preceding interest payment date which will become immediately due and payable.

The annual debt service requirements are as follows:

Year ending
June 30, Principal Interest Total
2025 215,000 $ 54,120 $ 269,120 $
2026 225,000 43,680 268,680
2027 235,000 32,760 267,760
2028 245,000 21,360 266,360
2029 260,000 9,360 269,360
Total 1,180,000 $ 161,280 $ 1,341,280 $
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
68 Note 6 – Long-Term Liabilities (Continued)
B. Business-Type Activities (Continued)
Sewer Capital Improvement Project Loan #1
On April 6, 2011, the City entered into an agreement with the Clean Water State Revolving Fund Control Board for construction of the Sewer Capital Improvement project. The City may borrow up to $2,644,356 or the eligible costs of the project, whichever is less. As of June 30, 2024, the City had drawn down the entire loan fund. The loan has an interest rate of 2.6% with maturities through 2031. The outstanding balance at June 30, 2024 was $1,212,172.

In the event of default, the Clean Water State Revolving Fund Control Board may sue the City as it deems necessary to compel the payment of the loan.

The annual debt service requirements are as follows:

Year ending
June 30, Principal Interest Total
2025 138,264 $ 31,516 $ 169,780 $
2026 141,859 27,922 169,781
2027 145,547 24,233 169,780
2028 149,331 20,449 169,780
2029 153,214 16,566 169,780
2031-2032 483,957 25,381 509,338
Total 1,212,172 $ 146,067 $ 1,358,239 $
Sewer Capital Improvement Project Loan #2
On April 6, 2011, the City entered into an agreement with the Clean Water State Revolving Fund Control Board for construction of the Sewer Capital Improvement project. The City may borrow up to $2,125,112 or the eligible costs of the project, whichever is less. At June 30, 2024, the State Water Resources Control Board had disbursed $1,652,742. The loan has an interest rate of 2.6% with maturities through 2031. The outstanding balance at June 30, 2024 was $929,237.

In the event of default, the Clean Water State Revolving Fund Control Board may sue the City as it deems necessary to compel the payment of the loan.

The annual debt service requirements are as follows:

Year ending
June 30, Principal Interest Total
2025 82,563 $ 24,160 $ 106,723 $
2026 84,709 22,014 106,723
2027 86,912 19,811 106,723
2028 89,171 17,551 106,722
2029 91,490 15,233 106,723
2031-2034 494,392 39,222 533,614
Total 929,237 $ 137,991 $ 1,067,228 $
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
69 Note 6 – Long-Term Liabilities (Continued)
B. Business-Type Activities (Continued)
West Orange County Water Board Loan
On December 11, 2017, the City entered into financial participation agreement with the West Orange County Water Board (the “WOCWB”) for relocation of the City’s allocated 14.3% ownership in the waterline. The City’s portion of project costs was in the amount of $894,928. The repayments are due quarterly on the first of the month commencing June 1, 2018. The interest rate ranges from 1.414% to 5.314% with maturity date on March 1, 2028. The outstanding balance at June 30, 2024 was $358,855.

The annual debt service requirements are as follows:

Year ending
June 30, Principal Interest Total
2025 126,654 $ 15,222 $ 141,876 $
2026 84,436 6,764 91,200
2027 84,436 4,370 88,806
2028 63,329 1,302 64,631
Total 358,855 $ 27,658 $ 386,513 $
Subscription Liabilities
The City entered into subscription agreements with various vendors for software. The agreements expire from July 19, 2025 to February 8, 2027 with interest rates ranging 2.35 percent to 2.80 percent. Outstanding subscription liabilities at June 30, 2024 was in the amount of $204,545.

The future subscription payments are as follows:

Year Ending
June 30, Principal Interest Total
2025 74,952 $ 5,220 $ 80,172 $
2026 63,985 3,287 67,272
2027 65,608 1,664 67,272
Total 204,545 $ 10,171 $ 214,716 $
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
70 Note 7 – Non-City Obligations
A. Heron Pointe Community Facilities District No. 2002-01 The Heron Pointe Community Facilities District No. 2002-01 was formed to finance public facilities improvements within Heron Pointe. The debt service payments on the bonds will be included on property tax bills within community facilities district and will be collected by the City and then forwarded to the paying agent. A reserve fund was established in which the City may make withdrawals enough to cover any delinquent payments on the reassessments. The City has no liability for the bonds beyond the amount held in the reserve fund. The bonds are not secured by the general taxing power of the City, county, state, or any political subdivision of the state nor have the City, county, state, or any political subdivision thereof pledged its full faith and credit for the repayment thereof. Since the City has no liability for these bonds, the reserve fund and debt service monies are stored in the Agency Fund and the debt is not included in the financial statements. The outstanding balance at June 30, 2024, was $2,360,000.

B. Pacific Gateway Business Center Community Facilities District No. 2005-01 The Pacific Gateway Business Center Community Facilities District No. 2005-01 was formed to finance public facilities within the Pacific Gateway. The debt service payments on the bonds will be included on property tax bills within the community facilities district and will be collected by the City and then forwarded to the paying agent. A reserve fund was established in which the City may make withdrawals enough to cover any delinquent payments on the reassessments. The City has no liability for the bonds beyond the amount held in the Reserve Fund. The bonds are not secured by the general taxing power of the City, county, state, or any political subdivision of the state nor have the City, county, state, or any political subdivision thereof pledged its full faith and credit for the repayment thereof. Since the City has no liability for these bonds, the reserve fund and debt service monies are stored in the Agency Fund and the debt is not included in the financial statements. The outstanding balance at June 30, 2024, was $6,410,000.

Note 8 – Risk Management and Self Insurance Program
A. Description of Self-Insurance Pool Pursuant to Joint Powers Agreement The City of Seal Beach (the “City”) is a member of the California Joint Powers Insurance Authority (the “Authority”). The Authority is composed of 126 California public entities and is organized under a joint powers agreement pursuant to California Government Code §6500 et seq. The purpose of the Authority is to arrange and administer programs for the pooling of self-insured losses, to purchase excess insurance or reinsurance, and to arrange for group purchased insurance for property and other lines of coverage. The California JPIA began covering claims of its members in 1978. Each member government has an elected official as its representative on the Board of Directors. The Board operates through a nine-member Executive Committee.

B. Primary Self-Insurance Programs of the Authority
Each member pays an annual contribution at the beginning of the coverage period. The total funding requirement for primary self-insurance programs is based on an actuarial analysis. Costs are allocated to individual agencies based on payroll and claims history, relative to other members of the risk-sharing pool.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
71 Note 8 – Risk Management and Self Insurance Program (Continued) B. Primary Self-Insurance Programs of the Authority (Continued) Primary Liability Program
Claims are pooled separately between police and general government exposures. (1) The payroll of each member is evaluated relative to the payroll of other members. A variable credibility factor is determined for each member, which establishes the weight applied to payroll and the weight applied to losses within the formula. (2) The first layer of losses includes incurred costs up to $100,000 for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the first layer. (3) The second layer of losses includes incurred costs from $100,000 to $500,000 for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the second layer. (4) Incurred costs from $500,000 to $50 million, are distributed based on the outcome of cost allocation within the first and second loss layers.

The overall coverage limit for each member, including all layers of coverage, is $50 million per occurrence.

Subsidence losses also have a $50 million per occurrence limit. The coverage structure is composed of a combination of pooled self-insurance, reinsurance, and excess insurance. Additional information concerning the coverage structure is available on the Authority’s website: https://cjpia.org/coverage/risk-sharing-pools/.

Primary Workers' Compensation Program
Claims are pooled separately between public safety (police and fire) and general government exposures. (1) The payroll of each member is evaluated relative to the payroll of other members. A variable credibility factor is determined for each member, which establishes the weight applied to payroll and the weight applied to losses within the formula. (2) The first layer of losses includes incurred costs up to $75,000 for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the first layer. (3) The second layer of losses includes incurred costs from $75,000 to $200,000 for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the second layer. (4) Incurred costs from $200,000 to statutory limits are distributed based on the outcome of cost allocation within the first and second loss layers.

For 2023-24 the Authority’s pooled retention is $1 million per occurrence, with reinsurance to statutory limits under California Workers’ Compensation Law. Employer’s Liability losses are pooled among members to $1 million. Coverage from $1 million to $5 million is purchased through reinsurance policies, and Employer’s Liability losses from $5 million to $10 million are pooled among members.

C. Purchased Insurance
Pollution Legal Liability Insurance
The City participates in the pollution legal liability insurance program which is available through the Authority.

The policy covers sudden and gradual pollution of scheduled property, streets, and storm drains owned by the City. Coverage is on a claims-made basis. There is a $250,000 deductible. The Authority has an aggregate limit of $20 million.

Property Insurance
The City participates in the all-risk property protection program of the Authority. This insurance protection is underwritten by several insurance companies. City property is currently insured according to a schedule of covered property submitted by the City to the Authority. City property currently has all-risk property insurance protection in the amount of $65,774,028. There is a $10,000 deductible per occurrence except for non-emergency vehicle insurance which has a $2,500 deductible.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
72 Note 8 – Risk Management and Self Insurance Program (Continued) C. Purchased Insurance (Continued)
Crime Insurance
The City purchases crime insurance coverage in the amount of $3,000,000 with a $2,500 deductible. The fidelity coverage is provided through the Authority.

D. Adequacy of Protection
During the past three fiscal years, none of the above programs of protection experienced settlements or judgments that exceeded pooled or insured coverage. There were also no significant reductions in pooled or insured liability coverage in 2023-24.

E. Claims Activity
Claims expenses and liabilities are reported when it is probable that a loss has occurred and the amount of that loss can be reasonably estimated. There were workers’ compensation claims that remained outstanding for claims occurred prior to joining the Authority. At June 30, 2024, the amount of these liabilities was $171,203.

A summary of the changes in claims liabilities for the past three fiscal years is as follows:

Current Year
Claims and
Balance Changes in Claim Balance
Workers' Compensation Beginning of Year Estimates Payments End of Year 2021-2022 297,295 $ - $ (34,126) $ 263,169 $
2022-2023 263,169 - (88,123) 175,046
2023-2024 175,046 - (3,843) 171,203
Note 9 – Defined Benefit Pension Plans
A. General Information about the Pension Plan
Plan Description
The City contributes to the California Public Employees’ Retirement System (“CalPERS”), a cost-sharing multiple-employer defined benefit pension plan. CalPERS provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. CalPERS acts as a common investment and administrative agent for participating public entities within the State of California. Benefit provisions and all other requirements are established by State statute and City ordinance. Copies of the CalPERS annual financial report may be obtained from https://www.calpers.ca.gov/page/forms-publications.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
73 Note 9 – Defined Benefit Pension Plans (Continued)
A. General Information about the Pension Plan (Continued) Employees Covered by Benefit Terms
At June 30, 2022, the following employees were covered by the benefit terms:

Misc Misc PEPRA Safety Safety Fire
Safety Police
PEPRA
Other Safety
PEPRA
Active employees 28 29 32 - 11 1
Transferred and terminated employees 35 9 4 - - -
Separated 29 4 5 - 2 -
Retired Employees and Beneficiaries 150 1 96 37 - -
Total 242 43 137 37 13 1
Benefit Provided
CalPERS provide retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. Classic miscellaneous members become eligible for service retirement upon attainment of age 55 with at least 5 years of credited service. PEPRA miscellaneous members become eligible for service retirement upon attainment of age 62 with at least 5 years of service. Classic safety members become eligible for service retirement upon attainment of age 50 with at least five years of service. PEPRA safety members become eligible for service retirement upon attainment of age 57 with at least five years of service. The service retirement benefit is a monthly allowance equal to the product of the benefit factor, years of service, and final compensation. The final compensation is the monthly average of the member's highest 36 full-time equivalent monthly pay.

Following are the benefit provisions for each plan:

Miscellaneous Rate PEPRA Miscellaneous Safety Rate PEPRA Safety Plan* Rate Plan Plan* Rate Plan
Hire date Prior to January 1, 2013 Prior to January 1, 2013 Benefit formula 2% @ 55 2% @ 62 3% @ 50 2.7% @ 57
Benefit vesting schedule 5 years service 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life monthly for life Retirement age minimum 50 yrs minimum 52 yrs minimum 50 yrs minimum 50 yrs Monthly benefits, as a % of eligible
compensation

1.426% - 2.418%,
50 yrs - 63+ yrs,
respectively

1.000% - 2.500%,
52 yrs - 67+ yrs,
respectively

3.000%,
50+ yrs

2.000%-2.7000%,
52 yrs - 57+ yrs,
respectively
* Closed to new entrants
Cost-sharing Rate Plans
Participants are eligible for non-industrial disability retirement if they become disabled and have at least 5 years of credited service. There is no special age requirement. The standard non-industrial disability retirement benefit is a monthly allowance equal to 1.8 percent of final compensation, multiplied by service. Industrial disability benefits are not offered to miscellaneous employees.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
74 Note 9 – Defined Benefit Pension Plans (Continued)
A. General Information about the Pension Plan (Continued) Benefit Provided (Continued)
An employee's beneficiary may receive the basic death benefit if the employee dies while actively employed. The employee must be actively employed with the City to be eligible for this benefit. An employee's survivor who is eligible for any other pre-retirement death benefit may choose to receive that death benefit instead of this basic death benefit. The basic death benefit is a lump sum in the amount of the employee's accumulated contributions, where interest is currently credited at 6 percent per year, plus a lump sum in the amount of one month's salary for each completed year of current service, up to a maximum of six months' salary. For purposes of this benefit, one month's salary is defined as the member's average monthly full-time rate of compensation during the 12 months preceding death.

Upon the death of a retiree, a one-time lump sum payment of $500 will be made to the retiree's designated survivor(s), or to the retiree's estate.

Benefit terms provide for annual cost-of-living adjustments to each employee’s retirement allowance. Beginning the second calendar year after the year of retirement, retirement and survivor allowances will be annually adjusted on a compound basis by 2 percent.

Contributions
Section 20814(c) of the California Public Employees’ Retirement Law (“PERL”) requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process. The actuarially determined rate is based on the estimated amount necessary to pay the Plan's allocated share of the risk pool's costs of benefits earned by employees during the year, and any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. For the measurement period ended June 30, 2023 (the measurement date), the contribution rates were as follows:

Miscellaneous Rate PEPRA Miscellaneous Safety Rate PEPRA Safety Plan* Rate Plan Plan* Rate Plan
Required employee contribution
rates 7.00% 7.25% 9.00% 13.75%
Required employer contribution
rates 11.61% 7.76% 25.64% 13.66%
* Closed to new entrants
Cost-sharing Rate Plans
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
75 Note 9 – Defined Benefit Pension Plans (Continued)
B. Pension Liabilities, Pension Expenses, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pension
Actuarial Methods and Assumptions Used to Determine Total Pension Liability The June 30, 2022 valuation was rolled forward to determine June 30, 2023 total pension liability based on the following actuarial methods and assumptions:

Actuarial Cost Method
Actuarial Assumptions:

Discount Rate 6.90%
Inflation 2.30%
Salary Increases
Mortality Rate Table1
Post Retirement Benefit Increase Contract COLA up to 2.3% until Purchasing Power Protection Allowance Floor on Purchasing Power applies, 2.3% thereafter
Derived using CalPERS’ Membership Data for all Funds
Entry age normal in accordance with requirements of GASB 68 Varies by Entry Age and Service
1 The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. Mortality rates incorporate full generational mortality improvement using 80% of Scale MP-2020 published by the Society of Actuaries. For more details on this table, please refer to the 2021 experience study report from November 2021 that can be found on the CalPERS website.

Change of Assumption
In 2023, there were no changes in assumptions.

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. Using historical returns of all of the funds’ asset classes, expected compound (geometric) returns were calculated over the next 20 years using a building-block approach. The expected rate of return was then adjusted to account for assumed administrative expenses of 10 basis points.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
76 Note 9 – Defined Benefit Pension Plans (Continued)
B. Pension Liabilities, Pension Expenses, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pension (Continued)
Long-term Expected Rate of Return (Continued)
The expected real rates of return by asset class are as follows:

Assumed Asset
Asset Class1 Allocation Real Return1,2
Global Equity - Cap-weighted 30.00% 4.54%
Global Equity - Non-Cap-weighted 12.00% 3.80%
Private Equity 13.00% 7.28%
Treasury 5.00% 0.27%
Mortgage-backed Securities 5.00% 0.50%
Investment Grade Corporates 10.00% 1.56%
High Yield 5.00% 2.27%
Emerging Market Debt 5.00% 2.48%
Private Debt 5.00% 3.57%
Real Assets 15.00% 3.21%
Leverage -5.00% -0.59%
100.00%
1 An expected inflation of 2.30% used for this period.
2 Figures are based on the 2021 Asset Liability Management study.

Discount Rate
The discount rate used to measure the total pension liability was 6.90%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

Sensitivity of the City’s Proportionate Share of the Net Pension Liability to Changes in the Discount Rate The following presents the City’s proportionate share of the net pension liability of the Plan as of the measurement date, calculated using the discount rate of 6.90%, as well as what the City’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1 percentage-point lower (5.90%) or 1 percentage-point higher (7.90%) than the current rate:

Discount Rate Current Discount Discount Rate
- 1% (5.90%) Rate (6.90%) + 1% (7.90%)
Miscellaneous $ 17,825,226 25,575,504 $ 11,446,082 $
Safety $ 34,643,664 49,553,147 $ 22,454,100 $
Plan's Net Pension Liability/(Asset)
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
77 Note 9 – Defined Benefit Pension Plans (Continued)
B. Pension Liabilities, Pension Expenses, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pension (Continued)
Pension Plan Fiduciary Net Position
Detail information about the plan’s fiduciary net position is available in the separately issued CalPERS financial report and can be obtained from CalPERS’ website under Forms and Publications.

Proportionate Share of Net Pension Liability and Pension Expense The following table shows the plan’s proportionate share of the risk pool collective net pension liability over the measurement period:

Plan Total Plan Fiduciary Net Pension
Pension Liability Net Position Liability/(Asset)
Miscellaneous
Balance at: 6/30/22 (Valuation date) 55,349,318 $ 38,532,294 $ 16,817,024 $ Balance at: 6/30/23 (Measurement date) 57,305,152 39,479,926 17,825,226 Net Changes during 2022-2023 1,955,834 947,632 1,008,202 Safety
Balance at: 6/30/22 (Valuation date) 104,384,046 $ 71,895,974 $ 32,488,072 $ Balance at: 6/30/23 (Measurement date) 108,683,799 74,040,135 34,643,664 Net Changes during 2022-2023 4,299,753 2,144,161 2,155,592 Increase (Decrease)
The following is the approach established by the plan actuary to allocate the net pension liability and pension expense to the individual employers within the risk pool. (1) In determining a cost-sharing plan’s proportionate share, total amounts of liabilities and assets are first calculated for the risk pool as a whole on the valuation date (June 30, 2022). The risk pool’s fiduciary net position (“FNP”) subtracted from its total pension liability (“TPL”) determines the net pension liability (“NPL”) at the valuation date.
(2) Using standard actuarial roll forward methods, the risk pool TPL is then computed at the measurement date (June 30, 2023). Risk pool FNP at the measurement date is then subtracted from this number to compute the NPL for the risk pool at the measurement date. For purposes of FNP in this step and any later reference thereto, the risk pool’s FNP at the measurement date denotes the aggregate risk pool’s FNP at June 30, 2023 less the sum of all additional side fund (or unfunded liability) contributions made by all employers during the measurement period (2022-2023). (3) The individual plan’s TPL, FNP and NPL are also calculated at the valuation date. TPL is allocated based on the rate plan’s share of the actuarial accrued liability. FNP is allocated based on the rate plan’s share of the fair value assets.
(4) Two ratios are created by dividing the plan’s individual TPL and FNP as of the valuation date from (3) by the amounts in step (1), the risk pool’s total TPL and FNP, respectively.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
78 Note 9 – Defined Benefit Pension Plans (Continued)
B. Pension Liabilities, Pension Expenses, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pension (Continued)
Proportionate Share of Net Pension Liability and Pension Expense (Continued) (5) The plan’s TPL as of the Measurement Date is equal to the risk pool TPL generated in (2) multiplied by the TPL ratio generated in (4). The plan’s FNP as of the Measurement Date is equal to the FNP generated in (2) multiplied by the FNP ratio generated in (4) plus any additional side fund (or unfunded liability) contributions made by the employer on behalf of the plan during the measurement period. (6) The plan’s NPL at the Measurement Date is the difference between the TPL and FNP calculated in (5).

Deferred outflows of resources, deferred inflows of resources, and pension expense is allocate based on the City’s share of contributions during measurement period.

The City’s proportionate share of the net pension liability was as follows:

Miscellaneous Safety
June 30, 2022 0.14559% 0.28126%
June 30, 2023 0.14288% 0.27770%
Change - Increase (Decrease) -0.00271% -0.00356%
The amortization period differs depending on the source of the gain or loss. The difference between projected and actual earnings is amortized over 5-years straight line. All other amounts are amortized straight-line over the average expected remaining service lives of all members that are provided with benefits (active, inactive and retired) as of the beginning of the measurement period.

The expected average remaining service lifetime (“EARSL”) is calculated by dividing the total future service years by the total number of plan participants (active, inactive, and retired) in the risk pool. The EARSL for risk pool for the 2022-2023 measurement period is 3.8 years, which was obtained by dividing the total service years of 600,538 (the sum of remaining service lifetimes of the active employees) by 160,073 (the total number of participants: active, inactive, and retired).

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
79 Note 9 – Defined Benefit Pension Plans (Continued)
B. Pension Liabilities, Pension Expenses, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pension (Continued)
Proportionate Share of Net Pension Liability and Pension Expense (Continued) For the year ended June 30, 2024, the City recognized pension expense for the miscellaneous and safety plans in the amounts of $2,319,975 and $ $13,423,015, respectively. At June 30, 2024, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred outflows Deferred inflows Deferred outflows Deferred inflows of Resources of Resources of Resources of Resources
Contribution after measurement date 1,781,962 $ - $ 4,296,096 $ - $ Changes of assumptions 1,076,190 - 2,021,853 -
Difference between expected and actual
experience 910,610 (141,257) 2,543,486 (217,749)
Difference between projected and actual
earning on pension plan investments 2,886,066 - 4,740,983 - Differences in proportions - (646,150) 94,671 (187,311) Difference between City contributions and
proportionate share of contributions 65,768 (242,951) - (31,032) Total 6,720,596 $ (1,030,358) $ 13,697,089 $ (436,092) $ Miscellaneous Safety
Deferred outflows of resources related to pensions resulting from the City’s contributions made subsequent to the measurement date in the amount of $1,781,962 and $4,296,096 for the miscellaneous and safety plans, respectively, will be recognized as a reduction of the collective net pension liability in the year ending June 30, 2025. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Measurement Period
Ended June 30, Miscellaneous Safety
2024 952,864 $ 2,805,066 $
2025 683,488 2,070,718
2026 2,189,110 3,956,789
2027 82,814 132,328
2028 - -
Thereafter - -
$ 8,964,901 3,908,276 $
Deferred Outflows/ (Inflows) of Resources
Note 10 – Other Postemployment Benefits (“OPEB”) Plan
A. General Information about the OPEB Plan
Plan Description
The City provides postretirement medical benefits to employees who retire directly from the City under CalPERS under a single-employer defined benefit post-employment benefits plan. Eligible retirees can continue participation in the City medical plans (“PEMHCA”). For miscellaneous retirees, the City contributes up to a capped dollar amount which varies by bargaining unit, medical coverage, and years of service. For police safety retirees, the City contribution rate varies by date of hire and date of retirement.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
80 Note 10 – Other Postemployment Benefits (“OPEB”) Plan A. General Information about the OPEB Plan (Continued)
Benefits Provided
Future Retirees are eligible for PEMCHA minimum medical benefits ($151 per month in 2024) if they retire at Age 50 and above. For legacy hires, reimbursements are generally subject to a maximum, which varies by bargaining group and service years. Dependents are eligible to enroll subject to service year requirements.

Employees Covered by Benefit Term
Active employees 107
Active employees waiving coverage -
Inactive employees, spouses, or beneficiaries
currently receiving benefit payments 76
Total 183
Contributions
The City makes contributions based on an actuarially determined rate.

B. Net OPEB Liability
The City's net OPEB liability is based on a roll-forward of the June 30, 2023 valuation with liabilities and assets measured as of June 30, 2023.

Actuarial Assumptions
The total OPEB liability in the June 30, 2023 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement, unless otherwise specified:

Actuarial Cost Method
Actuarial Assumptions:

Inflation 2.30%
Salary increases
Investment rate of return 5.10%
Healthcare cost trend rates 7.4% (non-Medicare) / 4.2% (Medicare) in 2023, decreasing gradually to an ultimate rate of 4.14% by 2075.

Mortality rate
Entry age normal level percentage of salary
Base salary increases in year one: 2.80%
Base salary increases in subsequent years: 2.80%
Additional merit-based increases based on CalPERS.

Derived using CalPERS’ Membership Data for all Funds.

City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
81 Note 10 – Other Postemployment Benefits (“OPEB”) Plan (Continued) B. Net OPEB Liability (Continued)
Discount Rate
The discount rate used to measure the total OPEB liability was 6.00%. The projection of cash flows used to determine the discount rate assumed that the City contribution 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 cover all future OPEB payments. Therefore, the discount rate was set equal to the long-term expected rate of return.

Expected Long-Term Rates of Return
Target Allocation
CERBT - Projected Real
Asset Class Strategy 1 Rates of Return 1
Global Equity 49.0% 4.56%
Global Fixed Income 23.0% 1.56%
REITs 20.0% 4.06%
TIPS 5.0% -0.08%
Commodities 3.0% 1.22%
100.0%
1 An expected inflation of 2.3% used for this period
C. Changes in the Net OPEB Liability
Total OPEB Fiduciary Net Net OPEB
Liability Position Liability
Balances as of June 30, 2021 13,421,076 $ 7,129,788 $ 6,291,288 $ Changes during the measurement period:

Service cost 285,492 - 285,492
Interest 800,414 - 800,414
Differences between expected and actual experience (1,305,093) - (1,305,093) Change of assumptions (915,746) - (915,746)
Contributions:

Employer - 981,209 (981,209)
Employee - - -
Net investment income - 460,154 (460,154)
Benefit payments, including refunds of employee
Contributions (732,718) (732,718) -
Administrative expenses - (3,561) 3,561
Other Additions/Deductions - (1,204) 1,204
Net changes during measurement period 2021-2022 (1,867,651) 703,880 (2,571,531) Balances as of June 30, 2022 (Measurement Date) 11,553,425 $ 7,833,668 $ 3,719,757 $ Increase (Decrease)
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
82 Note 10 – Other Postemployment Benefits (“OPEB”) Plan (Continued) C. Changes in the Net OPEB Liability (Continued)
Sensitivity of the Net OPEB Liability to Changes in the Discount Rate The net OPEB liability of the City, as well as what the City's net OPEB liability would be if it were calculated using a discount rate that is one percentage point lower (5.00%) or one percentage point higher (7.00%) follows:

Discount Rate Current Discount Discount Rate
- 1% (5.00%) Rate (6.00%) + 1% (7.00%)
$ 3,719,757 4,997,881 $ 2,635,487 $
Net OPEB Liability/(Asset)
Sensitivity of the Net OPEB Liability to Changes in the Healthcare Cost Trend Rates The net OPEB liability of the City, as well as what the City's net OPEB liability would be if it were calculated using healthcare cost trend rates that are one percentage point lower or one percentage point higher than current healthcare cost trend rates follows:

Healthcare
1% Decrease Cost Trend Rate 1% Increase
$ 3,719,757 2,737,012 $ 4,853,593 $
Net OPEB Liability/(Asset)
D. OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB For the year ended June 30, 2024, the City recognized an OPEB expense of $470,727. At June 30, 2024, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

Deferred outflows Deferred inflows
of Resources of Resources
OPEB contribution after measurement date 965,337 $ - $
Changes of assumptions 592,403 (825,335)
Difference between expected and actual experience 69,828 (1,270,191) Difference between projected and actual earning on
OPEB plan investments 464,739 -
Total 2,092,307 $ (2,095,526) $
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
83 Note 10 – Other Postemployment Benefits (“OPEB”) Plan (Continued) D. OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB (Continued)
Deferred outflows of resources related to OPEB resulting from City’s contributions subsequent to the measurement date in the amount of $965,337 will be recognized as a reduction of the net OPEB liability in the year ending June 30, 2025. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Measurement
Period Ending June
30,
Deferred Outflows/
(Inflows) of
Resources
2024 (149,040)
2025 (150,780)
2026 135,651
2027 (105,668)
2028 (481,204)
Thereafter (217,515)
$ (968,556)
Note 11 – Net Investment in Capital Assets
Net investment in capital assets at June 30, 2023 is reported as follows:

Governmental Business-Type
Activities Activities Water Utility Sewer Utility
Total capital assets, net 88,006,590 $ 33,745,390 $ 17,027,336 $ 16,718,054 $ Deferred loss on refunding debt - 60,352 - 60,352
Retention payable (266,604) (36,802) (36,802) -
Capital related debt (666,127) (3,884,809) (467,402) (3,417,407) Net investment in capital assets 87,073,859 $ 29,884,131 $ 16,523,132 $ 13,360,999 $ Enterprise Fund
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
84 Note 12 – Classification of Fund Balances
At June 30, 2024, fund balances are classified in the governmental funds as follows:

Capital Projects
Citywide Grants and Equipment Nonmajor
General Special Revenue Capital Projects Governmental
Fund Fund Fund Funds Total
Nonspendable:

Prepaid items 2,978,558 $ - $ - $ - $ 2,978,558 $
Restricted:

Waste Management 43,950 - - - 43,950
Parking In-lieu 67,100 - - - 67,100
I-405 Corridor Improvements 1,198,184 - - - 1,198,184
Supplemental Law Enforcement - - - 83,707 83,707
Detention Center - - - 28,341 28,341
Police Asset Forefeiture - - - 364,276 364,276
Air Quality Improvements - - - 33,792 33,792
Parks Improvement - - - 55,301 55,301
Traffic Impact - - - 199,803 199,803
State Gasoline Tax - - - 2,263,979 2,263,979
Measure M2 - - - 1,188,796 1,188,796
Community Development Block Grant - - - 73,249 73,249
Landscape District - - - 725,242 725,242
Heron Pointe - - - 73,631 73,631
Pacific Gateway - - - 173,874 173,874
Seal Beach Cable - - - 562,850 562,850
SB 1 - - - 1,354,995 1,354,995
City Debt Service - - - 662,234 662,234
Total restricted 1,309,234 - - 7,844,070 9,153,304
Committed:

Fiscal Policy 10,533,627 - - - 10,533,627
Economic Contingency 1,750,000 - - - 1,750,000
Capital Project Improvement 10,940,781 - 87,347 - 11,028,128 Total committed 23,224,408 - 87,347 - 23,311,755
Assigned:

Community Development 952,983 - - - 952,983
Pier Restaurant 1,792,805 - - - 1,792,805
Compensated Absences 1,303,166 - - - 1,303,166
Encumbrance for public works 503,187 - - - 503,187
Encumbrance for police 1,274,810 - - - 1,274,810
Encumbrance for community development 30,657 - - - 30,657 Other 856,463 - - - 856,463
Total assigned 6,714,071 - - - 6,714,071
Unassigned (deficit) (761,934) 5,242,784 - - 4,480,850
Total fund balances $ (761,934) 39,469,055 $ 87,347 $ 7,844,070 $ 46,638,538 $ City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
85 Note 13 – Commitments and Contingencies
A. Commitments
The City had no material commitments as of June 30, 2024.

B. Contingencies
The City is a defendant in a number of lawsuits, which have arisen in the normal course of business. While substantial damages are alleged in some of these actions, their outcome cannot be predicted with certainty.

C. Grants
Amounts received or receivable from granting agencies are subject to audit and adjustment by grantor agencies.

While no matters of noncompliance were disclosed by the audit of the financial statements or single audit of the Federal grant programs, grantor agencies may subject grant programs to additional compliance tests, which may result in disallowed costs. In the opinion of management, future disallowances of current or prior grant expenditures, if any, would not have a material adverse effect on the financial position of the City.

Note 14 – Individual Fund Disclosure
Funds with deficit fund balances at June 30, 2024 are as follows:

Deficit
Citywide Grants Special Revenue Fund (761,934) $
The City plans to eliminate the deficit fund balances with amounts due from grantors.

The following funds exceeded appropriation amounts for the year ended June 30, 2024:

Expenditures
in Excess of
Appropriations Expenditures Appropriations
Nonmajor Governmental Funds:

Street Lighting Special Revenue Fund 209,500 $ 234,361 $ (24,861) $ Heron Pointe Special Revenue Fund 8,100 9,177 (1,077)
City of Seal Beach
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2024
86 Note 15 – Prior Period Adjustments
A. Government-Wide Financial Statements
The City had the following prior period adjustments for the government-wide beginning net position at July 1, 2023:

Governmental Business-Type
Activities Activities Total
Net position as perviously reported at July 1, 2023 96,905,348 $ 44,667,100 $ 141,572,448 $ Depreciable capital assets, net of accumulated depreciation (1,999,346) 233,535 (1,765,811) Correction of accounts receivable recognized in prior year 142,094 - 142,094 Correction of business license revenue received 262,201 - 262,201 Net position as restated at July 1, 2023 95,310,297 $ 44,900,635 $ 140,210,932 $ B. Governmental Fund Financial Statements
The beginning fund balance was restated as following:

Citywide Grants Police Grants Total
Special Revenue Special Revenue Governmental
General Fund Fund Fund Funds
Fund balance as perviously reported at July 1, 2023 37,324,451 $ (696,382) $ (76,072) $ (772,454) $ Correction of accounts receivable recognized in prior year - 98,181 43,920 142,101 Correction of business license revenue received 262,201 - - - Fund balance as restated at July 1, 2023 37,586,652 $ (598,201) $ (32,152) $ (630,353) $ C. Enterprise Fund Financial Statements
The beginning net position was restated as following:

Total
Water Utility Sewer Utility Enterprise Funds
Net position as perviously reported at July 1, 2023 20,383,261 $ 24,283,839 $ 44,667,100 $ Depreciable capital assets, net of accumulated depreciation 62,802 170,733 233,535 Net position as restated at July 1, 2023 20,446,063 $ 24,454,572 $ 44,900,635 $ D. Internal Service Fund Financial Statements
The beginning net position was restated as following:

Vehicle Total
Replacement Internal Service
Fund Fund
Net position as perviously reported at July 1, 2023 700,842 $ 700,842 $ Depreciable capital assets, net of accumulated depreciation 143,713 143,713 Net position as restated at July 1, 2023 844,555 $ 844,555 $

REQUIRED SUPPLEMENTARY INFORMATION (UNAUDITED)
87 This page intentionally left blank.
88 Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Taxes 34,145,100 $ 34,945,100 $ 36,002,178 $ 1,057,078 $ Licenses and permits 723,000 723,000 939,640 216,640
Intergovernmental 90,000 1,711,218 1,789,580 78,362
Charges for services 6,556,000 6,387,816 6,674,619 286,803 Use of money and property 914,500 914,500 2,844,020 1,929,520 Fines and forfeitures 2,005,100 1,505,100 1,402,597 (102,503) Contributions 32,000 32,000 24,471 (7,529)
Miscellaneous 208,800 208,800 661,060 452,260
Total revenues 46,427,534 44,674,500 50,338,165 3,910,631 Expenditures:

Current:

General government 7,832,098 8,146,456 7,374,474 771,982 Public safety 25,035,757 24,852,184 24,716,603 319,154
Community development 2,863,324 2,783,324 2,325,464 537,860 Community services 1,442,775 1,407,775 1,399,938 42,837 Public works 9,345,254 8,018,362 7,304,526 2,040,728
Capital outlay 837,000 837,000 510,685 326,315
Debt service:

Principal retirement 85,107 85,107 493,805 (408,698)
Interest and fiscal charges 6,700 6,700 25,235 (18,535) Total expenditures 47,762,373 45,822,550 44,150,730 3,611,643 Revenues over (under) expenditures (1,334,839) (1,148,050) 6,187,435 7,522,274 Other Financing Sources (Uses):

Transfers in 191,200 850,700 109,000 (741,700)
Transfers out (13,903,555) (14,466,555) (4,414,032) 10,052,523 Total other financing sources (uses) (13,615,855) (13,712,355) (4,305,032) 9,310,823 Net change in fund balance $ (14,950,694) (14,860,405) $ 1,882,403 16,833,097 $ Fund Balance:

Beginning of year 37,586,652
End of year $ 39,469,055
City of Seal Beach
Required Supplementary Information (Unaudited)
For the Year Ended June 30, 2024
Budgeted Amounts
Budgetary Comparison Schedule – General Fund
89 Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Intergovernmental 1,931,497 $ 1,869,388 $ 801,754 $ (1,067,634) $ Total revenues 1,869,388 1,931,497 801,754 (1,067,634)
Expenditures:

Current:

Public safety - 100,000 40,000 60,000
Community development 40,000 40,000 - 40,000
Public works 109,000 996,891 156,575 840,316
Capital outlay 1,509,163 1,509,163 670,607 838,556
Total expenditures 2,646,054 1,658,163 867,182 1,778,872 Revenues over (under) expenditures (776,666) 273,334 (65,428) 711,238 Other Financing Uses:

Transfers out - - (98,305) (98,305)
Net change in fund balance $ (776,666) 273,334 $ (163,733) 612,933 $ Fund Balance (Deficit):

Beginning of year, as restated (Note 15) (598,201)
End of year $ (761,934)
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Citywide Grants Special Revenue Fund
For the Year Ended June 30, 2024
90 City of Seal Beach
Required Supplementary Information (Unaudited)
Notes to the Budgetary Comparison Schedule
For the Year Ended June 30, 2024
Budgetary Control and Accounting Policy
The City prepares its budgets on the basis of estimated revenues and expenditures and, accordingly, the budget amounts included in the accompanying financial statements are presented on a basis substantially consistent with generally accepted accounting principles.

Encumbrance accounting is utilized during the fiscal year, whereby purchase orders, contracts and other commitments are recorded in order to control appropriations. However, at fiscal year end, all appropriations lapse. Accordingly, encumbrances are cancelled and generally are re-appropriated as part of the following year’s budget. Encumbrances are not included in reported expenditures.

Annual budgets are adopted for the General Fund, Special Revenue Funds, Debt Service Funds, and Capital Projects Funds. In fiscal year 2023-24, no budget was adopted for the Detention Center Special Revenue Fund. The City Council approves total budgeted appropriations and any amendments to appropriations throughout the year.

The budgetary level of control for all governmental fund types is the fund level. The City Manager has the discretion to transfer appropriations between departments within a fund, but transfers between funds must be approved by the City Council. 91 Measurement Date June 30, 2023 June 30, 2022 June 30, 2021 June 30, 2020 June 30, 2019 City's Proportion of the Net Pension Liability 0.14288% 0.14559% 0.17295% 0.13777% 0.12949% City's Proportionate Share of the Net Pension Liability 17,825,226 $ 16,817,024 $ 9,353,495 $ 14,411,297 $ 13,320,233 $ City's Covered Payroll 5,535,460 $ 5,164,779 $ 5,162,753 $ 5,243,738 $ 4,721,968 $ City's Proportionate Share of the Net Pension Liability as a Percentage of its Covered Payroll 322.02% 325.61% 181.17% 274.83% 282.09% Plan's Proportionate Share of the Fiduciary Net Position as a Percentage of the Total Pension Liability 69.62% 69.62% 82.21% 71.73% 73.26% Measurement Date June 30, 2023 June 30, 2022 June 30, 2021 June 30, 2020 June 30, 2019 City's Proportion of the Net Pension Liability 0.27770% 0.28126% 1.09047% 0.26123% 0.25611% City's Proportionate Share of the Net Pension Liability 34,643,664 $ 32,488,072 $ 18,526,366 $ 28,423,181 $ 26,243,693 $ City's Covered Payroll 6,331,975 $ 6,401,398 $ 5,805,955 $ 5,607,704 $ 5,137,216 $ City's Proportionate Share of the Net Pension Liability as a Percentage of its Covered Payroll 547.12% 507.52% 319.09% 506.86% 510.85% Plan's Proportionate Share of the Fiduciary Net Position as a Percentage of the Total Pension Liability 68.88% 68.88% 79.77% 70.11% 71.27% California Public Employees' Retirement System ("CalPERS") Miscellaneous Plan California Public Employees' Retirement System ("CalPERS") Safety Plan City of Seal Beach
Required Supplementary Information (Unaudited)
Schedule of the City's Proportionate Share of the Net Pension Liability and Related Ratios For the Year Ended June 30, 2024
Last Ten Fiscal Years
92 Measurement Date June 30, 2018 June 30, 2017 June 30, 2016 June 30, 2015 June 30, 2014 City's Proportion of the Net Pension Liability 0.12641% 0.12396% 0.12144% 0.11333% 0.11644% City's Proportionate Share of the Net Pension Liability 12,180,833 $ 12,293,741 $ 10,508,345 $ 7,778,736 $ 7,245,313 $ City's Covered Payroll 4,713,200 $ 4,385,712 $ 4,226,024 $ 4,710,212 $ 4,503,370 $ City's Proportionate Share of the Net Pension Liability as a Percentage of its Covered Payroll 258.44% 280.31% 248.66% 165.15% 160.89% Plan's Proportionate Share of the Fiduciary Net Position as a Percentage of the Total Pension Liability 75.18% 75.11% 76.88% 82.15% 83.18% Measurement Date June 30, 2018 June 30, 2017 June 30, 2016 June 30, 2015 June 30, 2014 City's Proportion of the Net Pension Liability 0.25383% 0.24294% 0.24301% 0.23685% 0.19002% City's Proportionate Share of the Net Pension Liability 24,459,736 $ 24,093,096 $ 21,027,509 $ 16,257,122 $ 11,823,793 $ City's Covered Payroll 4,833,363 $ 4,200,942 $ 4,454,998 $ 4,734,950 $ 4,290,168 $ City's Proportionate Share of the Net Pension Liability as a Percentage of its Covered Payroll 506.06% 573.52% 472.00% 343.34% 275.60% Plan's Proportionate Share of the Fiduciary Net Position as a Percentage of the Total Pension Liability 72.12% 72.09% 73.44% 78.58% 81.42% California Public Employees' Retirement System ("CalPERS") Miscellaneous Plan California Public Employees' Retirement System ("CalPERS") Safety Plan City of Seal Beach
Required Supplementary Information (Unaudited)
Schedule of the City's Proportionate Share of the Net Pension Liability and Related Ratios (Continued) For the Year Ended June 30, 2024
Last Ten Fiscal Years
93 Fiscal year 2023-24 2022-23 2021-22 2020-21 2019-20
Actuarially Determined Contribution 1,781,962 $ 1,731,376 $ 1,575,633 $ 1,443,709 $ 1,275,186 $ Contribution in Relation to the
Actuarially Determined Contribution (1,781,962) (1,731,376) (1,575,633) (1,443,709) (1,275,186) Contribution Deficiency (Excess) - $ - $ - $ - $ - $
Covered Payroll 5,690,453 $ 5,535,460 $ 5,164,779 $ 5,162,753 $ 5,243,738 $ Contributions as a Percentage
of Covered Payroll 31.31% 31.28% 30.51% 27.96% 24.32%
Fiscal year 2023-24 2022-23 2021-22 2020-21 2019-20
Actuarially Determined Contribution 4,296,096 $ 3,915,610 $ 3,642,820 $ 3,231,920 $ 2,882,385 $ Contribution in Relation to the
Actuarially Determined Contribution (4,296,096) (3,915,610) (3,642,820) (3,231,920) (2,882,385) Contribution Deficiency (Excess) - $ - $ - $ - $ - $
Covered Payroll 6,509,270 $ 6,331,975 $ 6,401,398 $ 5,805,955 $ 5,607,704 $ Contributions as a Percentage
of Covered Payroll 66.00% 61.84% 56.91% 55.67% 51.40%
California Public Employees' Retirement System ("CalPERS") Safety Plan Changes of Assumptions: In 2023, there were no changes. In 2022, the acounting discount rate reduced from 7.15 percent to 6.90 percent. In 2021, 2020, and 2019, there were no changes. In 2018, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study and Review of Actuarial Assumptions December 2017. There were no changes in the discount rate. In 2017, the accounting discount rate reduced from 7.65 percent to 7.15 percent. In 2016, there were no changes. In 2015, amounts reported reflect an adjustment of the discount rate from 7.5 percent (net of administrative expense) to 7.65 percent (without a reduction for pension plan administrative expense.) In 2014, amounts reported were based on the 7.5 percent discount rate.

Benefit Changes: There were no changes to benefit terms. 2 Includes one year’s payroll growth using 2.80 percent payroll assumption for fiscal year 2023-24.

Notes to Schedule:

City of Seal Beach
Required Supplementary Information (Unaudited)
Schedule of Contributions - Pensions
For the Year Ended June 30, 2024
Last Ten Fiscal Years
California Public Employees' Retirement System ("CalPERS") Miscellaneous Plan 94 Fiscal year 2018-19 2017-18 2016-17 2015-16 2014-15
Actuarially Determined Contribution 1,076,211 $ 911,168 $ 791,754 $ 709,945 $ 734,255 $ Contribution in Relation to the
Actuarially Determined Contribution (1,076,211) (911,168) (791,754) (709,945) (734,255) Contribution Deficiency (Excess) - $ - $ - $ - $ - $
Covered Payroll 4,721,968 $ 4,713,200 $ 4,385,712 $ 4,226,024 $ 4,710,212 $ Contributions as a Percentage
of Covered Payroll 22.79% 19.33% 18.05% 16.80% 15.59%
Fiscal year 2018-19 2017-18 2016-17 2015-16 2014-15
Actuarially Determined Contribution 2,509,250 $ 2,127,080 $ 1,748,129 $ 1,608,716 $ 1,476,452 $ Contribution in Relation to the
Actuarially Determined Contribution (2,509,250) (2,127,080) (1,748,129) (1,608,716) (1,476,452) Contribution Deficiency (Excess) - $ - $ - $ - $ - $
Covered Payroll 5,137,216 $ 4,833,363 $ 4,200,942 $ 4,454,998 $ 4,734,950 $ Contributions as a Percentage
of Covered Payroll 48.84% 44.01% 41.61% 36.11% 31.18%
Changes of Assumptions: In 2023, there were no changes. In 2022, the acounting discount rate reduced from 7.15 percent to 6.90 percent. In 2021, 2020, and 2019, there were no changes. In 2018, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study and Review of Actuarial Assumptions December 2017. There were no changes in the discount rate. In 2017, the accounting discount rate reduced from 7.65 percent to 7.15 percent. In 2016, there were no changes. In 2015, amounts reported reflect an adjustment of the discount rate from 7.5 percent (net of administrative expense) to 7.65 percent (without a reduction for pension plan administrative expense.) In 2014, amounts reported were based on the 7.5 percent discount rate.

City of Seal Beach
Required Supplementary Information (Unaudited)
For the Year Ended June 30, 2024
Last Ten Fiscal Years
Schedule of Contributions - Pensions (Continued)
Notes to Schedule:

California Public Employees' Retirement System ("CalPERS") Safety Plan California Public Employees' Retirement System ("CalPERS") Miscellaneous Plan Benefit Changes: There were no changes to benefit terms. 95 Measurement period June 30, 2023 June 30, 2022 June 30, 2021 June 30, 2020 June 30, 2019 Total OPEB liability
Service cost 285,492 $ 250,120 $ 269,955 $ 253,910 $ 262,452 $ Interest 800,414 805,675 771,486 751,631 736,104
Differences between expected and actual experience (1,305,093) (140,904) 122,199 (109,256) (109,256) Changes of assumption (915,746) 738,472 113,616 (49,484) (49,484) Benefit payments (732,718) (742,658) (720,545) (516,782) (419,956) Implicit rate subsidy fulfilled - - - - (136,833)
Net change in total OPEB liability 910,705 (1,867,651) 556,711 330,019 283,027 Total OPEB liability, beginning 12,510,371 13,421,076 11,953,660 11,623,641 11,340,614 Total OPEB liability, ending (a) $ 13,421,076 11,553,425 $ 12,510,371 $ 11,953,660 $ 11,623,641 $ OPEB fiduciary net position
Contributions:

Employer - City's contribution 981,209 $ 985,606 $ 963,042 $ 588,400 $ 710,200 $ Employer - Implicit subsidy - - - - 136,833
Net investment income 460,154 (1,069,356) 1,663,551 360,219 324,350 Other additions - - - - -
Benefit payments (732,718) (742,658) (720,545) (516,782) (419,956) Implicit rate subsidy fulfilled - - - - (136,833)
Administrative expense (3,561) (2,016) (2,291) (2,768) (1,095) Other deductions (1,204) - - - -
Net change in plan fiduciary net position (828,424) 703,880 1,903,757 429,069 613,499 Plan fiduciary net position, beginning 7,958,212 7,129,788 6,054,455 5,625,386 5,011,887 Plan fiduciary net position, ending (b) 7,129,788 7,833,668 7,958,212 6,054,455 5,625,386 Plan net OPEB liability - ending (a) - (b) $ 6,291,288 3,719,757 $ 4,552,159 $ 5,899,205 $ 5,998,255 $ Plan's fiduciary net position as a percentage
of the total OPEB liability 67.80% 53.12% 63.61% 50.65% 48.40% Covered payroll $ 11,640,947 12,003,945 $ 10,959,848 $ 10,666,519 $ 9,923,172 $ Net OPEB liability as a percentage of covered payroll 30.99% 54.04% 41.53% 55.31% 60.45% 1 Historical information is presented only for measurement periods for which GASB 75 is implemented.

City of Seal Beach
Required Supplementary Information (Unaudited)
Schedule of Changes in Net Other Postemployment Benefits Liability and Related Ratios For the Year Ended June 30, 2024
Last Ten Fiscal Years
Other Postemployment Benefits ("OPEB")
96 Measurement period June 30, 2018 June 30, 20171
Total OPEB liability
Service cost $ 267,961 275,665 $
Interest 752,721 786,251
Differences between expected and actual experience - -
Changes of assumption - (413,262)
Benefit payments (454,685) (406,031)
Implicit rate subsidy fulfilled (114,993) (123,043)
Net change in total OPEB liability 451,004 119,580
Total OPEB liability, beginning 10,770,030 11,221,034
Total OPEB liability, ending (a) $ 11,221,034 11,340,614 $ OPEB fiduciary net position
Contributions:

Employer - City's contribution $ 567,185 720,871 $
Employer - Implicit subsidy 114,993 123,043
Net investment income 411,482 346,820
Other additions - 3,763
Benefit payments (454,685) (406,031)
Implicit rate subsidy fulfilled (114,993) (123,043)
Administrative expense (1,995) (2,323)
Other deductions - (5,765)
Net change in plan fiduciary net position 521,987 657,335 Plan fiduciary net position, beginning 3,832,565 4,354,552 Plan fiduciary net position, ending (b) 4,354,552 5,011,887 Plan net OPEB liability - ending (a) - (b) $ 6,866,482 6,328,727 $ Plan's fiduciary net position as a percentage
of the total OPEB liability 44.19% 38.81%
Covered payroll $ 8,807,230 9,518,945 $
Net OPEB liability as a percentage of covered payroll 66.49% 77.96% Other Postemployment Benefits ("OPEB")
1 Historical information is presented only for measurement periods for which GASB 75 is implemented.

City of Seal Beach
Required Supplementary Information (Unaudited)
Schedule of Changes in Net Other Postemployment Benefits Liability and Related Ratios (Continued) For the Year Ended June 30, 2024
Last Ten Fiscal Years
97 Fiscal year end 2023-242 3 2022-23 2021-22 2020-21 2019-20 Actuarially determined contribution2 $ 810,473 905,303 $ 679,537 $ 794,339 $ 763,351 $ Contribution in relation to the actuarially
determined contribution2 (981,209) (974,611) (985,606) (963,041) (867,112) Contribution deficiency/(excess) (69,308) $ (170,736) $ (306,069) $ (168,702) $ (103,761) $ Covered-employee payroll3 $ 12,003,945 12,340,055 $ 11,640,947 $ 10,959,848 $ 10,666,519 $ Contributions as a percentage of
covered-employee payroll 7.90% 8.48% 8.47% 8.79% 8.13%
Notes to Schedule:

Valuation date:

Actuarial cost method:

Inflation:

Assumed payroll growth:

Healthcare cost trend:

Rate of return on assets:

Mortality:

City of Seal Beach
Required Supplementary Information (Unaudited)
Schedule of Contributions - Other Postemployment Benefits For the Year Ended June 30, 2024
Last Ten Fiscal Years

7.40% (non-Medicare) / 4.20% (Medicare), trending down to 4.14% by 2075

5.10%
Other Postemployment Benefits ("OPEB")
1 Historical information is presented only for measurement periods for which GASB 75 is implemented. 2 The June 30, 2021 actuarial valuation provided the actuarially determined contributions for fiscal year ended June 30, 2023. 3 Includes one year’s payroll growth using 2.80 percent payroll assumption from fiscal year 2022-23.

Based on assumptions for Public Agency Miscellaneous and Police members published in the December 2017 CalPERS Experience Study
Methods and assumptions used to determine contribution rates:

June 30, 2023
Entry age normal, level percent of pay

2.30% per year

2.80% year one and thereafter
98 Fiscal year end 2018-19 2017-18 2016-171
Actuarially determined contribution2 $ 833,241 755,936 $ 812,317 $ Contribution in relation to the actuarially
determined contribution2 (843,914) (847,033) (682,178)
Contribution deficiency/(excess) (91,097) $ (10,673) $ 130,139 $ Covered-employee payroll3 $ 9,518,945 9,923,172 $ 8,807,230 $ Contributions as a percentage of
covered-employee payroll 8.54% 8.87% 7.75%
Other Postemployment Benefits ("OPEB")
1 Historical information is presented only for measurement periods for which GASB 75 is implemented.

City of Seal Beach
Required Supplementary Information (Unaudited)
Schedule of Contributions - Other Postemployment Benefits (Continued) For the Year Ended June 30, 2024
Last Ten Fiscal Years
99 This page intentionally left blank.
100

SUPPLEMENTARY INFORMATION
101
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102
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Charges for services - $ - $ 22,840 $ (22,840) $
Total expenditures - - 22,840 (22,840)
Expenditures:

Current:

General government 315,301 349,176 98,146 251,030
Public safety 536,145 593,747 167,177 426,570
Public works 3,363,215 3,724,545 1,047,870 2,676,675
Capital outlay 9,089,195 10,065,701 2,831,905 7,233,796 Total expenditures 14,733,169 13,303,856 4,145,098 10,588,071 Revenues over (under) expenditures (14,733,169) (13,303,856) (4,122,258) 10,565,231 Other Financing Sources:

Transfers in 13,303,855 13,866,855 4,069,624 (9,797,231) Net change in fund balance $ (866,314) (1) $ (52,634) 813,680 $ Fund Balance:

Beginning of year 139,981
End of year $ 87,347
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual Capital Projects and Equipment Capital Projects Fund
For the Year Ended June 30, 2024
103
This page intentionally left blank.
104
City Debt Service Debt Service Fund : To account for resources that are restricted for the payments of long-term debt.

Pacific Gateway Special Revenue Fund : To account for property taxes that are restricted for costs related to the maintenance of parks, parkways and open space within the District (Landscape Maintenance).

SB 1 Special Revenue Fund : To account for revenue received from the City's 1/2-cent per gallon gas tax and new vehicle registration taxes restricted for a wide range of transportation improvement projects.

Seal Beach Cable Special Revenue Fund : To account for revenues derived from PEGS fees which provide for channel capacity to be restricted for public, education, or government use.

Heron Pointe Special Revenue Fund : To account for the construction and acquisition of certain public street improvements, water and sanitary sewer improvements, dry utility improvements, park and landscaping improvements.

Landscape District Special Revenue Fund : To account for property taxes that are restricted for costs related to the maintenance of parks, parkways and open space within the Community Facility District 2002-02 (Landscape Maintenance).

NONMAJOR GOVERNMENTAL FUNDS
Detention Center Special Revenue Fund : To account for funds initially funded by monies seeded from the previous jail services vendor. The revenues also derived from sales of commissary items to the prisoners for their benefit.

Police Asset Forfeiture Special Revenue Fund : To accounts for revenues derived from monies and property seized in Federal, State, and Local drug-related incidents.

Street Lighting Special Revenue Fund : To account for property taxes that are restricted for the maintenance of streetlights and to finance the electricity used by the streetlights.

Police Grants Special Revenue Fund : To account for various grants including the Urban Area Security Initiative (UASI), the Office of Traffic Safety (OTS) DUI grant reimburses funds advanced by the City for DUI enforcement, the Bullet Proof Vest Protection (BVP) grant which provides matching funds that are restricted for the purchase of bullet-resistant vests, the Alcohol Beverage Control (ABC) grant and the Justice Assistance Grant (JAG).

Supplemental Law Enforcement Special Revenue Fund : To account for funds received from the State under the State Citizens Option for Public Safety Program. Certain procedures are required to be implemented prior to the use of the funds, and the funds cannot be used to supplant existing funding for law enforcement.

Air Quality Improvement Special Revenue Fund : To accounts for supplemental vehicle license fee revenue distributed to Cities by the South Coast Air Quality Management District pursuant to Assembly Bill 2766. Expenditures are restricted for programs that will reduce air pollution by reducing, directly or indirectly, mobile source emission pollutants.

Park Improvement Special Revenue Fund : To account for the Quimby Act Fees received by developers that are restricted for the improvement of parks and recreation facilities.

Traffic Impact Special Revenue Fund : To account for fair-share based fees that will serve to offset, or mitigate, the traffic impacts caused by new development.

State Gasoline Tax Special Revenue Fund : To accounts for locally shared gas tax monies collected by the State. Expenditures are restricted for repair, construction, maintenance and right-of-way acquisitions relating to streets and highways.

Measure M2 Special Revenue Fund : To account for restricted funds for transportation improvements through the Measure M Transportation Investment Plan (M2) such as major improvement plans target Orange County freeways, streets and roads, transit and environmental programs.

Community Development Block Grant (CDBG) Special Revenue Fund : To account for for funds provided by Federal Housing and Urban Development restricted for a wide variety of unique community development needs. 105
Supplemental
Street Law Detention Police Asset
Lighting Enforcement Center Forfeiture
ASSETS
Cash and investments 18,178 $ 89,193 $ 28,341 $ 365,997 $ Receivables:

Accounts - - - -
Taxes 830 - - -
Total assets $ 89,193 19,008 $ 28,341 $ 365,997 $

LIABILITIES, DEFERRED INFLOW OF

RESOURCES, AND FUND BALANCES
Liabilities:

Accounts payable 19,008 $ 5,486 $ - $ - $
Accrued liabilities - - - 1,721
Due to other funds - - - -
Retentions payable - - - -
Total liabilities 5,486 19,008 - 1,721
Fund Balances:

Restricted - 83,707 28,341 364,276
Total fund balances 83,707 - 28,341 364,276
Total liabilities, deferred inflow of resources,
and fund balances $ 89,193 19,008 $ 28,341 $ 365,997 $
(Continued)
Special Revenue
City of Seal Beach
Combining Balance Sheet
June 30, 2024
Nonmajor Governmental Funds
106
Air Quality Park Traffic State
Improvement Improvement Impact Gasoline Tax
ASSETS
Cash and investments 33,792 $ 55,301 $ 199,803 $ 2,207,712 $ Receivables:

Accounts - - - -
Taxes - - - 60,095
Total assets $ 55,301 33,792 $ 199,803 $ 2,267,807 $

LIABILITIES, DEFERRED INFLOW OF

RESOURCES, AND FUND BALANCES
Liabilities:

Accounts payable - $ - $ - $ 3,828 $
Accrued liabilities - - - -
Due to other funds - - - -
Retentions payable - - - -
Total liabilities - - - 3,828
Fund Balances:

Restricted 33,792 55,301 199,803 2,263,979
Total fund balances 55,301 33,792 199,803 2,263,979
Total liabilities, deferred inflow of resources,
and fund balances $ 55,301 33,792 $ 199,803 $ 2,267,807 $ (Continued)
Special Revenue
City of Seal Beach
Combining Balance Sheet (Continued)
June 30, 2024
Nonmajor Governmental Funds
107
Community
Development Police Landscape
Measure M2 Block Grant Grants District
ASSETS
Cash and investments 1,458,345 $ 67,990 $ 145,247 $ 732,974 $ Receivables:

Accounts 89,000 5,259 34,072 -
Taxes - - - -
Total assets $ 73,249 1,547,345 $ 179,319 $ 732,974 $

LIABILITIES, DEFERRED INFLOW OF

RESOURCES, AND FUND BALANCES
Liabilities:

Accounts payable 342,282 $ - $ - $ 7,264 $
Accrued liabilities - - 12,763 468
Due to other funds - - 166,556 -
Retentions payable 16,267 - - -
Total liabilities - 358,549 179,319 7,732
Fund Balances:

Restricted 1,188,796 73,249 - 725,242
Total fund balances 73,249 1,188,796 - 725,242
Total liabilities, deferred inflow of resources,
and fund balances $ 73,249 1,547,345 $ 179,319 $ 732,974 $ (Continued)
City of Seal Beach
Special Revenue
Nonmajor Governmental Funds
Combining Balance Sheet (Continued)
June 30, 2024
108
Pacific Seal Beach
Heron Pointe Gateway Cable SB 1
ASSETS
Cash and investments 73,677 $ 178,007 $ 537,882 $ 1,451,132 $ Receivables:

Accounts - - 24,968 -
Taxes - 307 - 52,544
Total assets $ 178,314 73,677 $ 562,850 $ 1,503,676 $

LIABILITIES, DEFERRED INFLOW OF

RESOURCES, AND FUND BALANCES
Liabilities:

Accounts payable 46 $ 4,128 $ - $ 109,898 $
Accrued liabilities - 312 - -
Due to other funds - - - -
Retentions payable - - - 38,783
Total liabilities 4,440 46 - 148,681
Fund Balances:

Restricted 73,631 173,874 562,850 1,354,995
Total fund balances 173,874 73,631 562,850 1,354,995
Total liabilities, deferred inflow of resources,
and fund balances $ 178,314 73,677 $ 562,850 $ 1,503,676 $ (Continued)
City of Seal Beach
Combining Balance Sheet (Continued)
June 30, 2024
Nonmajor Governmental Funds
Special Revenue
109
Debt Service
Total Other
City Debt Governmental
Service Funds
ASSETS
Cash and investments $ 8,305,805 662,234 $
Receivables:

Accounts 153,299 -
Taxes 113,776 -
Total assets $ 8,572,880 662,234 $

LIABILITIES, DEFERRED INFLOW OF

RESOURCES, AND FUND BALANCES
Liabilities:

Accounts payable $ 491,940 - $
Accrued liabilities 15,264 -
Due to other funds 166,556 -
Retentions payable 55,050 -
Total liabilities 728,810 -
Fund Balances:

Restricted 7,844,070 662,234 $
Total fund balances 7,844,070 662,234
Total liabilities, deferred inflow of resources,
and fund balances $ 8,572,880 662,234 $
(Concluded)
City of Seal Beach
Combining Balance Sheet (Continued)
Nonmajor Governmental Funds
June 30, 2024
110
Supplemental
Street Law Detention Police Asset
Lighting Enforcement Center Forfeiture
Revenues:

Taxes 139,856 $ - $ - $ - $
Intergovernmental - 186,159 - 360,984
Charges for services - - - -
Use of money and property - 3,048 - 74
Contributions - - - -
Total revenues 189,207 139,856 - 361,058
Expenditures:

Current:

General government - - - -
Public safety - 239,522 - -
Community development - - - -
Public works 234,361 - - -
Capital outlay - - - -
Debt service:

Principal - - - -
Interest and fiscal charges - - - -
Total expenditures 239,522 234,361 - -
Revenues over (under) expenditures (50,315) (94,505) - 361,058 Other Financing Sources (Uses):

Transfers in 94,452 - - -
Transfers out - - - -
Total other financing sources (uses) - 94,452 - -
Net change in fund balances (50,315) (53) - 361,058
Fund Balance (Deficit):

Beginning of year, as restated (Note 15) 53 134,022 28,341 3,218 End of year $ 83,707 - $ 28,341 $ 364,276 $
(Continued)
Special Revenue
For the Year Ended June 30, 2024
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances City of Seal Beach
Nonmajor Governmental Funds
111
Air Quality Park Traffic State
Improvement Improvement Impact Gasoline Tax
Revenues:

Taxes - $ - $ - $ - $
Intergovernmental 16,301 - - 698,355
Charges for services - - - -
Use of money and property 374 1,199 4,331 44,218
Contributions - - - -
Total revenues 1,199 16,675 4,331 742,573
Expenditures:

Current:

General government - - - -
Public safety - - - -
Community development - - - -
Public works - - - 3,332
Capital outlay - - - 133,310
Debt service:

Principal - - - -
Interest and fiscal charges - - - -
Total expenditures - - - 136,642
Revenues over (under) expenditures 1,199 16,675 4,331 605,931 Other Financing Sources (Uses):

Transfers in - - - -
Transfers out - - - (30,000)
Total other financing sources (uses) - - - (30,000)
Net change in fund balances 1,199 16,675 4,331 575,931
Fund Balance (Deficit):

Beginning of year, as restated (Note 15) 17,117 54,102 195,472 1,688,048 End of year $ 55,301 33,792 $ 199,803 $ 2,263,979 $
(Continued)
Special Revenue
City of Seal Beach
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) For the Year Ended June 30, 2024
Nonmajor Governmental Funds
112
Community
Development Police Landscape
Measure M2 Block Grant Grants District
Revenues:

Taxes - $ - $ - $ 137,685 $
Intergovernmental 558,612 349,591 232,200 -
Charges for services - - - -
Use of money and property 33,207 - - 15,531
Contributions - - - -
Total revenues 349,591 591,819 232,200 153,216
Expenditures:

Current:

General government - - - -
Public safety - - 345,295 -
Community development - 216,655 - 85,687
Public works - - - -
Capital outlay 961,053 - - -
Debt service:

Principal - - - -
Interest and fiscal charges - - - -
Total expenditures 216,655 961,053 345,295 85,687
Revenues over (under) expenditures 132,936 (369,234) (113,095) 67,529 Other Financing Sources (Uses):

Transfers in - - 145,247 -
Transfers out - - - (31,400)
Total other financing sources (uses) - - 145,247 (31,400) Net change in fund balances 132,936 (369,234) 32,152 36,129 Fund Balance (Deficit):

Beginning of year, as restated (Note 15) 1,558,030 (59,687) (32,152) 689,113 End of year $ 73,249 1,188,796 $ - $ 725,242 $
(Continued)
Special Revenue
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Nonmajor Governmental Funds
City of Seal Beach
For the Year Ended June 30, 2024
113
Pacific Seal Beach
Heron Pointe Gateway Cable SB1
Revenues:

Taxes - $ 86,763 $ - $ - $
Intergovernmental - - - 638,573
Charges for services - - 93,847 -
Use of money and property - - 12,698 40,143
Contributions 15,000 25,000 5,000 -
Total revenues 111,763 15,000 111,545 678,716
Expenditures:

Current:

General government - - 73,544 -
Public safety - - - -
Community development 9,177 62,344 - -
Public works - - - -
Capital outlay - - - 907,329
Debt service:

Principal - - - -
Interest and fiscal charges - - - -
Total expenditures 62,344 9,177 73,544 907,329
Revenues over (under) expenditures 49,419 5,823 38,001 (228,613) Other Financing Sources (Uses):

Transfers in - - - -
Transfers out (1,600) (26,000) (20,000) -
Total other financing sources (uses) (26,000) (1,600) (20,000) - Net change in fund balances 23,419 4,223 18,001 (228,613) Fund Balance (Deficit):

Beginning of year, as restated (Note 15) 69,408 150,455 544,849 1,583,608 End of year $ 173,874 73,631 $ 562,850 $ 1,354,995 $
(Continued)
City of Seal Beach
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) For the Year Ended June 30, 2024
Special Revenue
Nonmajor Governmental Funds
114
Debt Service
Total Other
City Debt Governmental
Service Funds
Revenues:

Taxes $ 364,304 - $
Intergovernmental 3,040,775 -
Charges for services 93,847 -
Use of money and property 176,447 21,624
Contributions 45,000 -
Total revenues 3,720,373 21,624
Expenditures:

Current:

General government 73,544 -
Public safety 584,817 -
Community development 373,863 -
Public works 237,693 -
Capital outlay 2,001,692 -
Debt service:

Principal 315,000 315,000
Interest and fiscal charges 8,845 8,845
Total expenditures 3,595,454 323,845
Revenues over (under) expenditures 124,919 (302,221)
Other Financing Sources (Uses):

Transfers in 442,713 203,014
Transfers out (109,000) -
Total other financing sources (uses) 333,713 203,014
Net change in fund balances 458,632 (99,207)
Fund Balance (Deficit):

Beginning of year, as restated (Note 15) 761,441 7,385,438 End of year $ 7,844,070 662,234 $
(Concluded)
City of Seal Beach
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Nonmajor Governmental Funds
For the Year Ended June 30, 2024
115
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Taxes 141,000 $ 141,000 $ 139,856 $ (1,144) $
Total revenues 141,000 141,000 139,856 (1,144)
Expenditures:

Current:

Public works 209,500 $ 209,500 $ 234,361 $ (24,861) $
Total expenditures 209,500 209,500 234,361 (24,861)
Revenues over (under) expenditures (68,500) (68,500) (94,505) (26,005) Other Financing Sources:

Transfers in 68,500 68,500 94,452 25,952
Net change in fund balance $ - - $ (53) (53) $
Fund Balance:

Beginning of year 53
End of year $ -
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2024
Budgeted Amounts
Street Lighting Special Revenue Fund
116
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Intergovernmental 157,500 $ 157,500 $ 186,159 $ 28,659 $ Use of money and property 1,000 1,000 3,048 2,048
Total revenues 158,500 158,500 189,207 30,707
Expenditures:

Current:

Public safety 214,950 244,950 239,522 5,428
Total expenditures 244,950 214,950 239,522 5,428
Net change in fund balance $ (86,450) (56,450) $ (50,315) 36,135 $ Fund Balance:

Beginning of year 134,022
End of year $ 83,707
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Supplemental Law Enforcement Special Revenue Fund
For the Year Ended June 30, 2024
117
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Intergovernmental 100,000 $ 100,000 $ 360,984 $ 260,984 $ Use of money and property 200 200 74 (126)
Total revenues 100,200 100,200 361,058 260,858
Expenditures:

Current:

Public safety 294,035 294,035 - 294,035
Total expenditures 294,035 294,035 - 294,035
Net change in fund balance $ (193,835) (193,835) $ 361,058 554,893 $ Fund Balance:

Beginning of year 3,218
End of year $ 364,276
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Police Asset Forfeiture Special Revenue Fund
For the Year Ended June 30, 2024
118
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Intergovernmental 30,000 $ 30,000 $ 16,301 $ (13,699) $ Use of money and property 100 100 374 274
Total revenues 30,100 30,100 16,675 (13,425)
Expenditures:

Current:

Public works 30,000 30,000 - 30,000
Total expenditures 30,000 30,000 - 30,000
Net change in fund balance $ 100 100 $ 16,675 16,575 $
Fund Balance:

Beginning of year 17,117
End of year $ 33,792
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Air Quality Improvement Special Revenue Fund
For the Year Ended June 30, 2024
119
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Use of money and property 400 $ 400 $ 1,199 $ 799 $
Total revenues 400 400 1,199 799
Net change in fund balance $ 400 400 $ 1,199 799 $
Fund Balance:

Beginning of year 54,102
End of year $ 55,301
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Park Improvement Special Revenue Fund
For the Year Ended June 30, 2024
120
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Use of money and property 1,100 $ 1,100 $ 4,331 $ 3,231 $ Total revenues 1,100 1,100 4,331 3,231
Net change in fund balance $ 1,100 1,100 $ 4,331 3,231 $ Fund Balance:

Beginning of year 195,472
End of year $ 199,803
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Traffic Impact Special Revenue Fund
For the Year Ended June 30, 2024
121
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Intergovernmental 726,958 $ 726,958 $ 698,355 $ (28,603) $ Use of money and property 8,500 8,500 44,218 35,718
Total revenues 735,458 735,458 742,573 7,115
Expenditures:

Current:

Public works 3,000 3,000 3,332 (332)
Capital outlay 2,550,110 2,600,110 133,310 2,466,800
Total expenditures 2,603,110 2,553,110 136,642 2,466,468 Revenues over (under) expenditures (1,867,652) (1,817,652) 605,931 2,473,583 Other Financing Uses:

Transfers out (30,000) (30,000) (30,000) -
Net change in fund balance $ (1,897,652) (1,847,652) $ 575,931 2,473,583 $ Fund Balance:

Beginning of year 1,688,048
End of year $ 2,263,979
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual State Gasoline Tax Special Revenue Fund
For the Year Ended June 30, 2024
122
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Intergovernmental 501,688 $ 501,688 $ 558,612 $ 56,924 $ Use of money and property 7,000 7,000 33,207 26,207
Total revenues 508,688 508,688 591,819 83,131
Expenditures:

Capital outlay 2,065,414 2,065,414 961,053 1,104,361
Total expenditures 2,065,414 2,065,414 961,053 1,104,361 Net change in fund balance $ (1,556,726) (1,556,726) $ (369,234) 1,187,492 $ Fund Balance:

Beginning of year 1,558,030
End of year $ 1,188,796
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Measure M2 Special Revenue Fund
For the Year Ended June 30, 2024
123
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Intergovernmental 333,400 $ 333,400 $ 349,591 $ 16,191 $ Total revenues 333,400 333,400 349,591 16,191
Expenditures:

Current:

Community development 333,400 333,400 216,655 116,745
Total expenditures 333,400 333,400 216,655 116,745
Net change in fund balance $ - - $ 132,936 132,936 $
Fund Balance:

Beginning of year (59,687)
End of year $ 73,249
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Community Development Block Grant Special Revenue Fund
For the Year Ended June 30, 2024
124
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Intergovernmental 369,000 $ 514,570 $ 232,200 $ (282,370) $ Total revenues 514,570 369,000 232,200 (282,370)
Expenditures:

Current:

Public safety 391,496 537,066 345,295 191,771
Total expenditures 537,066 391,496 345,295 191,771
Revenues over (under) expenditures (22,496) (22,496) (113,095) (90,599) Other Financing Uses:

Transfers in - - 145,247 145,247
Net change in fund balance $ (22,496) (22,496) $ 32,152 54,648 $ Fund Balance (Deficit):

Beginning of year, as restated (Note 15) (32,152)
End of year $ -
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Police Grants Special Revenue Fund
For the Year Ended June 30, 2024
125
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Taxes 140,000 $ 140,000 $ 137,685 $ (2,315) $
Use of money and property 5,000 5,000 15,531 10,531
Total revenues 145,000 145,000 153,216 8,216
Expenditures:

Current:

Community development 103,375 103,375 85,687 17,688
Total expenditures 103,375 103,375 85,687 17,688
Revenues over (under) expenditures 41,625 41,625 67,529 25,904 Other Financing Uses:

Transfers out (31,400) (31,400) (31,400) -
Net change in fund balance $ 10,225 10,225 $ 36,129 25,904 $ Fund Balance:

Beginning of year 689,113
End of year $ 725,242
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Landscape District Special Revenue Fund
For the Year Ended June 30, 2024
126
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenue:

Contributions 15,000 $ 15,000 $ 15,000 $ - $
Total revenues 15,000 15,000 15,000 -
Expenditures:

Current:

Community development 8,100 8,100 9,177 (1,077)
Total expenditures 8,100 8,100 9,177 (1,077)
Revenues over (under) expenditures 6,900 6,900 5,823 (1,077) Other Financing Uses:

Transfers out (1,600) (1,600) (1,600) -
Net change in fund balance $ 5,300 5,300 $ 4,223 (1,077) $ Fund Balance:

Beginning of year 69,408
End of year $ 73,631
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Heron Pointe Special Revenue Fund
For the Year Ended June 30, 2024
127
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Taxes 66,300 $ 66,300 $ 86,763 $ 20,463 $
Contributions 25,000 25,000 25,000 -
Total revenues 91,300 91,300 111,763 20,463
Expenditures:

Current:

Community development 75,637 75,637 62,344 13,293
Public works 38 38 - 38
Total expenditures 75,675 75,675 62,344 13,331
Revenues over (under) expenditures 15,625 15,625 49,419 33,794 Other Financing Uses:

Transfers out (26,000) (26,000) (26,000) -
Net change in fund balance $ (10,375) (10,375) $ 23,419 33,794 $ Fund Balance:

Beginning of year 150,455
End of year $ 173,874
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Pacific Gateway Special Revenue Fund
For the Year Ended June 30, 2024
128
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Charges for services 110,000 $ 110,000 $ 93,847 $ (16,153) $ Use of money and property 3,500 3,500 12,698 9,198
Contributions - - 5,000 5,000
Total revenues 113,500 113,500 111,545 (1,955)
Expenditures:

Current:

General government 145,000 145,000 73,544 71,456
Total expenditures 145,000 145,000 73,544 71,456
Revenues over (under) expenditures (31,500) (31,500) 38,001 69,501 Other Financing Uses:

Transfer out (20,000) (20,000) (20,000) -
Net change in fund balance $ (51,500) (51,500) $ 18,001 69,501 $ Fund Balance:

Beginning of year 544,849
End of year $ 562,850
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Seal Beach Cable Special Revenue Fund
For the Year Ended June 30, 2024
129
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Intergovernmental 623,988 $ 623,988 $ 638,573 $ 14,585 $ Use of money and property 6,000 6,000 40,143 34,143
Total revenues 629,988 629,988 678,716 48,728
Expenditures:

Capital outlay 1,128,278 1,203,278 907,329 295,949
Total expenditures 1,203,278 1,128,278 907,329 295,949
Net change in fund balance $ (573,290) (498,290) $ (228,613) $ 344,677 Fund Balance:

Beginning of year 1,583,608
End of year $ 1,354,995
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual SB1 Special Revenue Fund
For the Year Ended June 30, 2024
130
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Use of money and property 2,000 $ 2,000 $ 21,624 $ 19,624 $ Total revenues 2,000 2,000 21,624 19,624
Expenditures:

Debt service:

Principal retirement 315,000 315,000 315,000 -
Interest and fiscal charges 9,000 9,000 8,845 155
Total Expenditures 324,000 324,000 323,845 155
Revenues over (under) expenditures (322,000) (322,000) (302,221) 19,779 Other Financing Sources (USES):

Transfers in 324,000 324,000 203,014 (120,986)
Transfers out - (659,500) - 659,500
Total other financing sources (uses) (335,500) 324,000 203,014 538,514 Net change in fund balance $ (657,500) 2,000 $ (99,207) 558,293 $ Fund Balance:

Beginning of year 761,441
End of year $ 662,234
Budgeted Amounts
City of Seal Beach
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual City Debt Service Fund
For the Year Ended June 30, 2024
131
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132

INTERNAL SERVICE FUND FINANCIAL STATEMENTS
133
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134
Vehicle Information
Replacement Technology
Fund Fund Total
ASSETS
Current Assets:

Cash and investments 122,263 $ 36,982 $ 159,245 $
Accounts receivable 14,612 - 14,612
Total current assets 36,982 136,875 173,857
Noncurrent Assets:

Depreciable capital assets, net of accumulated depreciation - 582,469 582,469 Intangible capital assets, net of accumulated amortization - 200,390 200,390 Total capital assets 782,859 - 782,859
Total noncurrent assets - 782,859 782,859
Total assets 36,982 919,734 956,716

LIABILITIES
Current Liabilities:

Accounts payable 11,619 - 11,619
Long-term debt, due within one year 81,803 - 81,803
Total current liabilities 11,619 81,803 93,422
Noncurrent Liabilities:

Long-term debt, due in more than one year 125,423 - 125,423 Total Noncurrent Liabilities - 125,423 125,423
Total Liabilities 11,619 207,226 218,845

NET POSITION
Net investment in capital assets 575,633 - 575,633
Unrestricted 25,363 136,875 162,238
Total Net Position $ 25,363 712,508 $ 737,871 $
City of Seal Beach
Combining Statement of Net Position
Internal Service Funds
June 30, 2024
135
Vehicle Information
Replacement Technology
Fund Fund Total
OPERATING REVENUES:

Charges from user departments 137,000 $ - $ 137,000 $
Total operating revenues - 137,000 137,000
OPERATING EXPENSES:

Operating expenses 977 59,534 60,511
Amortization and depreciation expenses 266,364 - 266,364 Total operating expenses 59,534 267,341 326,875
OPERATING (LOSS) (59,534) (130,341) (189,875)
NONOPERATING INCOME:

Gain on sale of assets 2,059 - 2,059
Interest payments (3,765) - (3,765)
Total nonoperating income - (1,706) (1,706)
CHANGES IN NET POSITION (59,534) (132,047) (191,581)
NET POSITION:

Beginning of year, as restated (Note 15) 844,555 84,897 929,452 End of year $ 25,363 712,508 $ 737,871 $
City of Seal Beach
Combining Statement of Revenues, Expenses, and Changes in Net Position Internal Service Funds
For the Year Ended June 30, 2024
136
Vehicle Information
Replacement Technology
Fund Fund Total

CASH FLOWS FROM OPERATING
ACTIVITIES:

Cash received from customers and users 122,388 $ - $ 122,388 $ Cash paid to suppliers for goods and services (63,321) (15,021) (78,342) Net cash provided by (used in) operating activities (63,321) 107,367 44,046

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Proceed on disposal of assets 15,403 - 15,403
Principal paid on long-term debt (80,587) - (80,587)
Interest paid on long-term debt (3,765) - (3,765)
Net cash used in capital and related financing activities - (68,949) (68,949) Net change in cash and cash equivalents (63,321) 38,418 (24,903) CASH AND CASH EQUIVALENTS:

Beginning of year 83,845 100,303 184,148
End of year $ 36,982 122,263 $ 159,245 $
Reconciliation of Operating (Loss) to
Net Cash Provided By (Used in) Operating Activities:

Operating (loss) (130,341) $ (59,534) $ (189,875) $
Adjustments to reconcile operating (loss)
to net cash (used in) operating activities:

Amortization and depreciation expenses 266,364 - 266,364 Changes in assets and liabilities:
(Increase)/decrease in accounts receivables (14,612) - (14,612) Increase/(decrease) in accounts payable (14,044) (3,787) (17,831) Net cash provided by (used in) operating activities $ (63,321) 107,367 $ 44,046 $ City of Seal Beach
Combining Statement of Cash Flows
Internal Service Funds
For the Year Ended June 30, 2024
137
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138

CUSTODIAL FUNDS FINANCIAL STATEMENTS
139
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140
Community Community
Facilities Facilities
District District - Heron
Deposits Heron Pointe Pacific Gateway Total
ASSETS:

Cash and investments 269,020 $ 131,203 $ 246,514 $ 646,737 $ Receivables:

Accounts 736 - - 736
Taxes - 2,269 2,015 4,284
Restricted investments with fiscal agents - 272,152 753,850 1,026,002 Total Assets 405,624 269,756 1,002,379 1,677,759
LIABILITIES:

Interest payable - 29,549 67,175 96,724
Total Liabilities 29,549 - 67,175 96,724
NET POSITION:

Restricted for:

Individual, organization and other government 269,756 $ 376,075 $ 935,204 $ 1,581,035 $ City of Seal Beach
Combining Statement of Fiduciary Net Position
Custodial Funds
June 30, 2024
141
Community Community
Facilities Facilities
District District - Heron
Deposits Heron Pointe Pacific Gateway Total
ADDITIONS:

Assessment revenue collected - $ 267,271 $ 568,839 $ 836,110 $ Investment income - 16,932 42,812 59,744
Total additions 284,203 - 611,651 895,854
DEDUCTIONS:

Return of deposits 12,939 - - 12,939
Payment of special assessment district debt service - 260,663 555,969 816,632 Total deductions 260,663 12,939 555,969 829,571
Change in net position 23,540 (12,939) 55,682 66,283
NET POSITION:

Beginning of year 282,695 352,535 879,522 1,514,752
End of year 269,756 $ 376,075 $ 935,204 $ 1,581,035 $
Custodial Funds
For the Year Ended June 30, 2024
City of Seal Beach
Combining Statement of Changes in Fiduciary Net Position 142

STATISTICAL SECTION
143
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144
Page
These schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time. 146-155 These schedules contain information to help the reader assess the factors affecting the City's ability to generate its property and sales taxes. 156-159
These schedules present information to help the reader assess the affordability of the City's current levels of outstanding debt and the City's ability to issue additional debt in the future. 160-166 These schedules offer demographic and economic indicators to help the reader understand the environment within which the City's financial activities take place and to help make comparisons over time and with other governments. 167-168
These schedules contain information about the City's operations and resources to help the reader understand how the City's financial information relates to the services the City provides and the activities it performs. 169-172
Demographic and Economic Information
Operating Information
Statistical Section
Description of Statistical Section Contents
City of Seal Beach
For the Year Ended June 30, 2024
This part of the City of Seal Beach annual comprehensive financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the government’s overall financial health.

Financial Trends
Revenue Capacity
Debt Capacity
145
2015 2016 2017 2018 2019
Governmental activities:

Net investment in capital assets, 74,296,935 $ 73,939,948 $ 72,399,752 $ 72,667,466 $ 87,071,592 $ Restricted 3,842,792 3,866,679 4,587,081 4,207,675 4,825,412 Unrestricted 4,097,282 4,713,193 (3,660,561) (4,911,027) (9,873,029) Total governmental activities net position 82,237,009 $ 82,519,820 $ 73,326,272 $ 71,964,114 $ 82,023,975 $ Business-type activities:

Net investment in capital assets, 34,451,074 $ 34,145,069 $ 33,109,258 $ 31,663,486 $ 32,937,448 $ Restricted - - 25,082 25,082
Unrestricted 12,470,553 13,544,158 12,625,701 14,709,960 13,656,457 Total business-type activities net position 46,921,627 $ 47,689,227 $ 45,734,959 $ 46,398,528 $ 46,618,987 $ Primary government:

Net investment in capital assets, 108,748,009 $ 108,085,017 $ 105,509,010 $ 104,330,952 $ 120,009,040 $ Restricted 3,842,792 3,866,679 4,587,081 4,232,757 4,850,494 Unrestricted 16,567,835 18,257,351 8,965,140 9,798,933 3,783,428 Total primary government net position 129,158,636 $ 130,209,047 $ 119,061,231 $ 118,362,642 $ 128,642,962 $ Source: Finance Department, City of Seal Beach.

Fiscal Year
Last Ten Fiscal Years
(accrual basis of accounting)
City of Seal Beach
Net Position by Component
146
2020 2021 2022 2023 2024
Governmental activities:

Net investment in capital assets, 84,530,565 $ 85,059,375 $ 84,447,535 $ 85,686,837 $ 87,073,859 $ Restricted 7,601,451 7,201,479 8,759,394 10,354,192 9,915,238 Unrestricted (11,716,752) (9,239,218) (10,011,404) 864,319 3,470,267 Total governmental activities net position 80,415,264 $ 83,021,636 $ 83,195,525 $ 96,905,348 $ 100,459,364 $ Business-type activities:

Net investment in capital assets, 31,473,936 $ 30,784,313 $ 30,111,234 $ 29,928,878 $ 29,884,131 $ Restricted 25,082 25,082 25,082 25,082 25,082
Unrestricted 13,930,796 14,359,332 14,386,432 14,713,140 13,623,652 Total business-type activities net position 45,429,814 $ 45,168,727 $ 44,522,748 $ 44,667,100 $ 43,532,865 $ Primary government:

Net investment in capital assets, 116,004,501 $ 115,843,688 $ 114,558,769 $ 115,615,715 $ 116,957,990 $ Restricted 7,626,533 7,226,561 8,784,476 10,379,274 9,940,320 Unrestricted 2,214,044 5,120,114 4,375,028 15,577,459 17,093,919 Total primary government net position 125,845,078 $ 128,190,363 $ 127,718,273 $ 141,572,448 $ 143,992,229 $ Source: Finance Department, City of Seal Beach.

Fiscal Year
City of Seal Beach
Net Position by Component (Continued)
Last Ten Fiscal Years
(accrual basis of accounting)
147
2015 2016 2017 2018 2019
Expenses:

Governmental activities:

General government 6,551,584 $ 6,264,368 $ 5,894,947 $ 6,161,230 $ 6,479,347 $ Public safety 16,022,465 16,972,880 19,867,060 19,877,068 21,497,362 Community development 1,393,712 1,100,110 1,218,902 1,593,008 1,499,652 Community services 1,129,300 1,036,627 995,468 964,634 945,425 Public works 7,862,892 6,956,443 6,992,604 7,367,882 7,752,351 Interest on long-term debt 444,132 349,652 342,951 225,675 143,040 Total governmental activities expenses 33,404,085 32,680,080 35,311,932 36,189,497 38,317,177 Business-type activities:

Water utility 4,037,798 4,102,228 4,977,160 4,668,618 4,909,193 Sewer utility 1,661,225 1,676,651 2,639,043 2,539,783 2,523,366 Total business-type activities expenses 5,699,023 5,778,879 7,616,203 7,208,401 7,432,559 Total primary government expenses 39,103,108 38,458,959 42,928,135 43,397,898 45,749,736 Program revenues:

Governmental activities:

Charges for services:

General government 1,820,019 2,074,448 1,913,909 2,062,987 1,913,201 Public safety 2,132,176 1,521,220 2,045,589 1,903,530 1,907,577 Community development 186,858 192,878 217,486 300,640 597,318 Community services 1,020,316 1,015,517 707,813 733,456 840,428 Public works 1,937,305 1,832,289 2,105,747 2,398,039 2,556,857 Operating contributions and grants 2,768,435 2,122,139 1,721,167 2,334,480 2,588,454 Capital grants and contributions 20,000 10,000 174,685 79,175 9,777,900 Total governmental activities
program revenues 9,885,109 8,768,491 8,886,396 9,812,307 20,181,735 Business-type activities:

Charges for services:

Water utility 4,556,001 4,261,566 4,782,468 5,097,807 4,851,274 Sewer utility 2,765,357 2,466,869 2,784,942 2,928,885 2,854,208 Total business-type activities
program revenues 7,321,358 6,728,435 7,567,410 8,026,692 7,705,482 Total primary government
program revenues 17,206,467 15,496,926 16,453,806 17,838,999 27,887,217 Net revenues (expenses):

Governmental activities (23,518,976) (23,911,589) (26,425,536) (26,377,190) (18,135,442) Business-type activities 1,622,335 949,556 (48,793) 818,291 272,923 Total net revenues (expenses) (21,896,641) $ (22,962,033) $ (26,474,329) $ (25,558,899) $ (17,862,519) $ Source: Finance Department, City of Seal Beach.

City of Seal Beach
Changes in Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
Fiscal Year
148
2020 2021 2022 2023 2024
Expenses:

Governmental activities:

General government 6,868,616 $ 7,231,812 $ 8,604,149 $ 6,778,212 $ 7,833,713 $ Public safety 24,079,442 23,326,808 26,912,192 20,062,949 26,932,724 Community development 1,581,361 2,283,377 3,043,960 1,836,054 2,722,452 Community services 866,786 1,139,731 1,991,897 263,478 1,208,181 Public works 11,180,509 8,290,658 9,086,138 8,487,999 10,766,275 Interest on long-term debt 88,274 57,902 61,160 36,443 34,336 Total governmental activities expenses 44,664,988 42,330,288 49,699,496 37,465,135 49,497,681 Business-type activities:

Water utility 5,444,834 6,033,692 6,064,434 5,250,934 7,127,839 Sewer utility 3,035,447 2,651,801 2,323,027 2,292,687 3,353,390 Total business-type activities expenses 8,480,281 8,685,493 8,387,461 7,543,621 10,481,229 Total primary government expenses 53,145,269 51,015,781 58,086,957 45,008,756 59,978,910 Program revenues:

Governmental activities:

Charges for services:

General government 1,207,956 1,486,575 1,129,039 1,069,669 1,252,570 Public safety 2,124,798 2,361,646 2,547,127 2,282,044 1,976,293 Community development 231,087 221,140 434,955 499,835 508,638 Community services 700,877 985,542 1,244,430 1,221,628 1,328,884 Public works 2,732,164 2,596,848 2,842,031 3,588,535 4,199,836 Operating contributions and grants 3,442,883 4,287,922 9,362,550 4,165,836 4,231,563 Capital grants and contributions 30,707 10,692 655 889 1,199 Total governmental activities
program revenues 10,470,472 11,950,365 17,560,787 12,828,436 13,498,983 Business-type activities:

Charges for services:

Water utility 4,268,610 4,957,483 5,824,338 5,759,925 6,289,312 Sewer utility 3,007,958 2,885,699 2,432,441 2,371,663 2,422,870 Total business-type activities
program revenues 7,276,568 7,843,182 8,256,779 8,131,588 8,712,182 Total primary government
program revenues 17,747,040 19,793,547 25,817,566 20,960,024 22,211,165 Net revenues (expenses):

Governmental activities (34,194,516) (30,379,923) (32,138,709) (24,636,699) (35,998,698) Business-type activities (1,203,713) (842,311) (130,682) 587,967 (1,769,047) Total net revenues (expenses) (35,398,229) $ (31,222,234) $ (32,269,391) $ (24,048,732) $ (37,767,745) $ Source: Finance Department, City of Seal Beach.

City of Seal Beach
Changes in Net Position (Continued)
Last Ten Fiscal Years
(accrual basis of accounting)
Fiscal Year
149
2015 2016 2017 2018 2019
General revenues and other changes in net position:

Governmental activities:

Taxes:

Property taxes 10,050,815 $ 10,408,505 $ 11,012,246 $ 11,180,197 $ 11,481,535 $ Sales tax 4,246,080 4,228,730 4,379,341 4,303,618 5,546,264 Franchise taxes 1,163,595 955,922 1,016,938 1,059,581 1,097,774 Utility users taxes 4,646,434 4,445,180 4,177,713 4,186,554 4,061,031 Transient occupancy taxes 1,525,723 1,655,376 1,693,515 1,666,996 1,631,445 Other taxes 344,789 197,166 190,510 163,277 227,978
Motor vehicle in lieu, unrestricted 10,659 9,960 11,235 13,102 12,473 Use of money and property 725,720 1,004,572 425,014 300,817 1,692,720 Other 356,749 536,175 214,219 1,762,390 2,065,583
Transfers 378,500 378,500 378,500 378,500 378,500
Extraordinary Gain(loss) 694,585 - - - -
Total governmental activities 24,143,649 23,820,086 23,499,231 25,015,032 28,195,303 Business-type activities:

Use of money and property 109,575 176,437 167,661 223,778 326,036 Other 3,698 20,107 - - -
Transfers (378,500) (378,500) (378,500) (378,500) (378,500) Extraordinary Gain(loss) - - - - -
Total business-type activities (265,227) (181,956) (210,839) (154,722) (52,464) Total primary government 23,878,422 23,638,130 23,288,392 24,860,310 28,142,839 Changes in net position:

Governmental activities 624,673 (91,503) 23,499,231 25,015,032 10,059,861 Business-type activities 1,357,108 767,600 (210,839) (154,722) 220,459 Total primary government 1,981,781 $ 676,097 $ 23,288,392 $ 24,860,310 $ 10,280,320 $ Source: Finance Department, City of Seal Beach.

Fiscal Year
Changes in Net Position (Continued)
Last Ten Fiscal Years
(accrual basis of accounting)
City of Seal Beach
150
2020 2021 2022 2023 2024
General revenues and other changes in net position:

Governmental activities:

Taxes:

Property taxes 12,358,059 $ 12,926,895 $ 13,428,911 $ 14,468,211 $ 15,473,159 $ Sales tax 9,108,334 10,146,964 11,443,583 11,666,838 11,494,982 Franchise taxes 1,034,280 1,067,098 1,101,243 1,175,046 1,236,189 Utility users taxes 3,941,877 4,129,727 4,508,593 5,349,003 5,510,087 Transient occupancy taxes 1,298,707 878,165 1,670,504 1,922,823 1,919,725 Other taxes 724,854 720,807 757,421 1,104,573 732,341
Motor vehicle in lieu, unrestricted 21,133 19,070 28,238 25,874 31,179 Use of money and property 1,862,213 151,196 (1,428,396) 781,761 2,673,147 Other 1,463,177 3,270,753 69,001 1,118,893 2,076,956
Transfers 376,483 (324,379) 733,500 733,500 -
Extraordinary Gain(loss) - - - - -
Total governmental activities 32,189,117 32,986,296 32,312,598 38,346,522 41,147,765 Business-type activities:

Use of money and property 391,016 256,845 218,203 289,885 401,277 Other - - - - -
Transfers (376,483) 324,379 (733,500) (733,500) -
Extraordinary Gain(loss) - - - - -
Total business-type activities 14,533 581,224 (515,297) (443,615) 401,277 Total primary government 32,203,650 33,567,520 31,797,301 37,902,907 41,549,042 Changes in net position:

Governmental activities (2,005,399) 2,606,373 173,889 13,709,823 5,149,067 Business-type activities (1,189,180) (261,087) (645,979) 144,352 (1,367,770) Total primary government (3,194,579) $ 2,345,286 $ (472,090) $ 13,854,175 $ 3,781,297 $ Source: Finance Department, City of Seal Beach.

Fiscal Year
(accrual basis of accounting)
Changes in Net Position (Continued)
Last Ten Fiscal Years
City of Seal Beach
151
2015 2016 2017 2018 2019
General Fund:

Nonspendable 666,102 $ 682,859 $ 2,877 $ 32,495 $ 33,795 $ Restricted - - 12,277 5,266 5,419
Committed - - - - -
Assigned 7,623,994 7,610,286 7,478,281 8,289,150 10,152,504 Unassigned 21,711,517 20,811,037 19,770,202 17,491,623 11,922,370 Total general fund 30,001,613 $ 29,104,182 $ 27,263,637 $ 25,818,534 $ 22,114,088 $ All other governmental funds:

Nonspendable - $ - $ - $ - $ - $
Restricted 3,842,792 3,866,679 4,131,203 4,110,558 4,819,993 Assigned - - - - -
Unassigned (525,408) (51,254) (184,908) (34,159) (425,639) Total all Other government funds: 3,317,384 $ 3,815,425 $ 3,946,295 $ 4,076,399 $ 4,394,354 $ Source: Finance Department, City of Seal Beach
City of Seal Beach
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
152
2020 2021 2022 2023 2024
General Fund:

Nonspendable 41,776 $ 2,069,748 $ 51,506 $ 42,705 $ 2,978,558 $ Restricted 2,190,469 2,046,356 2,034,271 1,935,127 1,309,234 Committed 17,067,216 17,546,968 23,523,980 25,322,120 23,224,408 Assigned 4,370,059 4,704,595 4,853,380 5,097,455 6,714,071 Unassigned 3,509,871 3,629,265 3,885,769 4,927,044 5,242,784 Total general fund 27,179,391 $ 29,996,932 $ 34,348,906 $ 37,324,451 $ 39,469,055 $ All other governmental funds:

Nonspendable - $ - $ - $ - $ - $
Restricted 5,410,982 5,037,618 6,167,958 7,477,277 7,844,070 Assigned - - - - 87,347
Unassigned (671,694) (373,870) (554,027) (692,160) (761,934) Total all Other government funds: 4,739,288 $ 4,663,748 $ 5,613,931 $ 6,785,117 $ 7,169,483 $ Source: Finance Department, City of Seal Beach
City of Seal Beach
Fund Balances of Governmental Funds (Continued)
Last Ten Fiscal Years
(modified accrual basis of accounting)
153
2015 2016 2017 2018 2019
Revenues:

Taxes 23,114,876 $ 22,828,144 $ 23,368,371 $ 24,021,668 $ 25,903,080 $ Licenses and permits 1,377,131 1,304,924 1,234,590 1,480,971 1,416,737 Intergovernmental 1,725,127 1,388,056 744,904 1,530,815 857,923 Charges for services 3,961,691 4,214,690 5,349,083 4,586,949 4,878,405 Use of money and property 725,720 1,004,572 426,418 347,117 1,772,775 Fines and forfeitures 1,146,509 1,110,606 152,845 1,089,515 946,048 Contributions from other governments 330,885 283,222 180,511 55,765 45,994 Miscellaneous 375,588 537,777 492,245 520,420 2,319,864 Total revenues 32,757,527 32,671,991 31,948,967 33,633,220 38,140,826 Expenditures
Current:

General government 5,462,668 5,351,130 5,673,309 5,757,859 6,169,490 Public safety 15,811,773 16,378,416 17,395,965 18,148,871 19,240,608 Community development 1,362,308 1,175,339 1,186,081 1,488,921 1,446,025 Community services 1,129,497 1,075,282 1,004,690 954,018 942,804 Public works 5,631,015 4,862,058 4,586,373 4,967,066 5,160,373 Capital outlay 4,578,308 2,645,823 1,506,476 2,567,080 7,378,774 Debt service:

Principal retirement 1,337,573 1,490,150 2,162,379 1,640,521 1,754,905 Interest and fiscal charges 441,040 355,819 353,322 231,779 152,863 Total expenditures 35,754,182 33,334,017 33,868,595 35,756,115 42,245,842 Excess (deficiency) of revenue over
(under) expenditures (2,996,655) (662,026) (1,919,628) (2,122,895) (4,105,016) Other financing sources (uses):

Transfers in 7,012,848 5,602,944 4,472,129 5,714,614 9,381,712 Transfers out (6,919,381) (5,340,308) (4,262,176) (4,906,717) (8,663,187) Proceeds on sale of assets - - - - -
Total other financing sources (uses) 93,467 262,636 209,953 807,897 718,525 Net change in fund balances (2,903,188) $ (399,390) $ (1,709,675) $ (1,314,998) $ (3,386,491) $ Debt service as a percentage of
noncapital expenditures 5.7% 6.0% 7.8% 5.6% 5.5%
Source: Finance Department, City of Seal Beach
City of Seal Beach
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
154
2020 2021 2022 2023 2024
Revenues:

Taxes 27,481,580 $ 31,711,229 $ 34,976,825 $ 37,716,674 $ $36,366,482 Licenses and permits 844,274 771,615 926,792 1,027,232 939,640 Intergovernmental 4,330,159 2,195,977 6,754,322 1,622,005 5,632,109 Charges for services 4,684,076 4,853,170 5,118,769 5,821,082 6,791,306 Use of money and property 2,003,529 235,061 (1,197,815) 811,518 3,020,467 Fines and forfeitures 1,239,154 1,816,837 1,871,227 1,435,250 1,402,597 Contributions from other governments 60,942 106,528 76,817 77,023 69,471 Miscellaneous 2,995,022 3,431,013 240,917 1,291,231 661,060 Total revenues 43,638,736 45,121,430 48,767,854 49,802,015 54,883,132 Expenditures
Current:

General government 6,083,705 6,713,025 7,597,539 7,671,076 7,546,164 Public safety 20,921,107 21,895,428 23,892,990 24,570,207 25,508,597 Community development 1,408,699 2,203,834 2,185,707 2,218,015 2,699,327 Community services 852,664 1,131,906 1,174,593 1,219,014 1,399,938 Public works 6,672,230 5,748,811 6,884,360 6,625,681 8,746,664 Capital outlay 1,729,166 3,439,241 1,875,596 3,609,554 6,014,889 Debt service:

Principal retirement 494,370 496,920 532,556 789,974 808,805 Interest and fiscal charges 88,612 70,479 55,856 36,651 34,080 Total expenditures 38,250,553 41,699,644 44,199,197 46,740,172 52,758,464 Excess (deficiency) of revenue over
(under) expenditures 5,388,183 3,421,788 4,568,657 3,061,843 2,124,668 Other financing sources (uses):

Transfers in 4,141,526 2,858,654 2,697,577 4,359,511 4,621,337 Transfers out (4,119,472) (3,657,439) (1,964,077) (3,274,623) (4,621,337) Proceeds on sale of assets - 119,000 - - -
Total other financing sources (uses) 22,054 (679,785) 733,500 1,084,888 - Net change in fund balances 5,410,237 $ 2,742,003 $ 5,302,157 $ 4,146,731 $ 2,124,668 $ Debt service as a percentage of
noncapital expenditures 1.6% 1.5% 2.4% 1.9% 1.8%
City of Seal Beach
Changes in Fund Balances of Governmental Funds (Continued) Last Ten Fiscal Years
(modified accrual basis of accounting)
Source: Finance Department, City of Seal Beach
155
Fiscal Year Taxable Taxable Total
Ended Assessed Secured Assessed Direct Tax
June 30 Secured Unsecured Value (Note 1) Unsecured Value Rate 2015 4,709,232,207 182,551,480 4,891,783,687 556,548,983 3,863,246 560,412,229 1.00% 2016 4,795,647,822 285,081,875 5,080,729,697 530,597,248 32,693,247 563,290,495 1.00% 2017 4,978,010,106 152,713,169 5,130,723,275 300,533,393 2,090,757 302,624,150 1.00% 2018 5,237,420,910 128,598,670 5,366,019,580 309,374,617 2,150,646 311,525,263 1.00% 2019 5,475,552,225 150,040,128 5,625,592,353 320,174,015 2,103,366 322,277,381 1.00% 2020 5,817,854,806 159,142,122 5,976,996,928 363,940,344 3,281,367 367,221,711 1.00% 2021 6,051,396,970 155,640,583 6,207,037,553 375,196,393 5,389,789 380,586,182 1.00% 2022 6,253,516,508 145,853,857 6,399,370,365 414,507,317 7,059,017 421,566,334 1.00% 2023 6,688,389,755 162,820,842 6,851,210,597 - - - 1.00% 2024 7,106,450,551 184,902,698 7,291,353,249 - - - 1.00% GENERAL NOTE:

Source: County of Orange, Auditor - Controller Assessed Valuations Detail In 1978 the voters of the State of California passed Proposition 13 which limited property taxes to a total maximum rate of 1% based upon the assessed value of the property being taxed. Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only re-assessed at the time it is sold to a new owner. At that point, the new assessed value is reassessed at the purchase price of the property sold. The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property and is subject to the limitations described above.

City of Seal Beach
Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years
City Redevelopment Agency
Note 1: Fiscal Year ending June 30, 2022 is the last year tax increment within the former Seal Beach RDA boundaries will be received. For Fiscal Year ended June 2023, per Resolution of the Orange Countywide Oversight Board No. 22-001 Successor Agency to the Seal Beach Redevelopment Agency was dissolved. Beginning with Fiscal Year ending June 30, 2023, the city receives the property tax per AB 8 process. 156
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
City Direct Rates:

City Direct Rate - Basic Levy 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 Overlapping Rates:

Orange County Bonds 0.04719 0.06135 0.06001 0.06072 0.05881 0.05509 0.06379 0.05996 0.05880 0.04565 Metropolitan Water District 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 Other Districts 0.07468 0.07779 0.07367 0.09803 0.16561 0.13116 0.14183 0.12906 0.13106 0.11733 Total Direct & Overlapping
Rates 1.14264 1.12537 1.13718 1.16225 1.22792 1.18975 1.20912 1.19252 1.19336 1.16648 GENERAL NOTES:

Source: HdL, County of Orange, Auditor-Controller
City of Seal Beach
Direct and Overlapping Property Tax Rates
Last Ten Fiscal Years
In 1978, California voters passed Proposition 13 which sets the property tax rate at a

1.00% fixed amount. This 1.00% is shared by all taxing agencies for which the subject property resides within. In addition to the 1.00% fixed amount, property owners are charged taxes as a percentage of assessed property values for the payment of any voterapproved bonds. The City receives only a portion of this basic 1% levy.

Overlapping rates are those of local and county governments that apply to property owners within the City. Not all overlapping rates apply to all city property owners. 157

Percent of Percent of
Total City Total City
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxpayer Value Value Value Value
Seal Beach Mutual 1, $ 17.75% 705,534,817 294,241,561 $ 14.42% Boeing 140,089,705 1.92% 117,865,436 2.41%
CPT Shops at Rossmoor LLC 139,807,209 1.92% 127,841,584 2.61% ASN Long Beach LLC 1.83% 167,006,959 133,524,816 3.41%
Terra Funding-Bixby Ranch LLC 100,943,739 1.38% 85,385,900 1.75% Ranch Town Center LLC 51,472,089 0.71% 43,478,340 0.89% AL United States Seal Beach Senior Housing LP 45, 0.62% 47,219,048 184,721 0.97% OE 1729 Apollo CT LLC 36,108,000 0.50%
OXY Long Beach Inc 33, 0.45% 152,315,621 106,386 3.11%
Farmers and Merch Bank 0.45% 32,670,999
DCOR LLC 1.05% 51,205,140
Hellman Properties 0.68% 33,122,715
$ 27.53% 1,530,975,560 2,007,149,225 $ 31.30%
Source: HDL Coren & Cone
City of Seal Beach
Current Year and Ten Years Ago
Principal Property Taxpayers
2024 2015
158

Fiscal Taxes Levied Collections in
Year Ended for the Percent Subsequent Percent
June 30 Fiscal Year Amount of Levy Years Amount of Levy 2015 7,037,415 6,821,353 97.93% 73,362 10,295,379 98.63% 2016 7,477,860 7,201,613 97.36% 81,860 10,278,216 98.14% 2017 7,858,469 7,623,300 97.85% 65,706 10,776,371 98.45% 2018 8,244,985 8,056,409 98.35% 75,788 11,292,740 98.93% 2019 8,681,340 8,278,388 95.36% 74,350 8,352,738 96.21% 2020 9,424,684 9,274,535 98.41% 81,504 9,356,039 99.27% 2021 9,740,869 9,591,161 98.46% 101,723 9,692,884 99.51% 2022 10,134,749 9,961,155 98.29% 95,453 10,056,608 99.23% 2023 10,819,610 10,662,521 98.55% 107,920 10,770,441 99.55% 2024 11,423,367 11,227,941 98.29% 144,439 11,372,380 99.55% Source: Orange County Tax Ledger
City of Seal Beach
Property Tax Levies and Collections
Last Ten Fiscal Years
Total Collections to Date
Collected within the
Fiscal Year of Levy
159
Fiscal Year Pension Fire Total
Ended Obligation Station Governmental
June 30 Leases Bonds Bonds Climatec Subscriptions Activities 2015 - 4,411,000 3,675,000 1,488,358 - 9,574,358
2016 - 3,461,000 3,255,000 1,368,208 - 8,084,208
2017 - 2,414,000 2,835,000 672,829 - 5,921,829
2018 - 1,263,000 2,415,000 603,308 - 4,281,308
2019 - - 1,995,000 531,403 - 2,526,403
2020 - - 1,575,000 457,033 - 2,032,033
2021 - - 1,155,000 380,113 - 1,535,113
2022 237,517 - 735,000 300,555 949,058 2,222,130
2023 327,111 - 315,000 218,963 694,445 1,555,519
2024 210,272 - - - 455,855 666,127
Notes:

Details regarding the City's outstanding debt can be found in the notes to the financial statements. *Data not readily available.

Source: Finance Department, City of Seal Beach
Governmental Activities
City of Seal Beach
Last Ten Fiscal Years
Ratios of Outstanding Debt by Type
160
Fiscal Year Sewer 2011 Sewer Total Total Percentage Debt Ended Water Board Installment State Revolving Business-type Primary of Personal Per June 30 Loan Agreement Agreement Subscriptions Activities Government Income 1 Capita 1 2015 - 2,705,000 3,893,311 - 6,598,311 16,172,669 * 697 2016 - 2,565,000 3,718,034 - 6,283,034 14,367,242 * 613 2017 - 2,420,000 3,538,201 - 5,958,201 11,880,030 * 483 2018 872,555 2,270,000 3,353,690 - 6,496,245 10,777,553 * 398 2019 783,064 2,110,000 3,164,384 - 6,057,448 8,583,851 * 345 2020 654,381 1,940,000 2,970,155 - 5,564,536 7,596,569 * 304 2021 569,945 1,765,000 2,770,876 - 5,105,821 6,640,934 * 266 2022 485,509 1,580,000 2,566,416 357,237 4,989,162 7,211,292 * 290 2023 401,073 1,385,000 2,356,639 277,614 4,420,326 5,975,845 * 241 2024 358,855 1,180,000 2,141,409 204,545 3,884,809 4,550,936 * 187 Notes:

Details regarding the City's outstanding debt can be found in the notes to the financial statements. 1 See the schedule of Demographic and Economic Statistics for personal income and population data. *Data not readily available.

Source: Finance Department, City of Seal Beach
Business-type Activities
City of Seal Beach
Ratios of Outstanding Debt by Type (Continued)
Last Ten Fiscal Years
161
Fiscal Year Private Percent of
Ended Placement Total Assessed Per
June 30 Bonds Bonds Bonds Value 1 Capita
2015 - 8,086,000 8,086,000 0.15% 329
2016 - 6,716,000 6,716,000 0.12% 273
2017 - 4,507,180 5,249,000 0.10% 213
2018 - 2,937,013 2,937,013 0.05% 118
2019 - 1,995,000 1,995,000 0.03% 80
2020 - 1,575,000 1,575,000 0.02% 63
2021 - 1,155,000 1,155,000 0.02% 46
2022 - 735,000 735,000 0.01% 30
2023 - 315,000 315,000 0.00% 13
2024 - - - 0.00% -
NOTES:
1 Assessed value has been used because the actual value of taxable property is not readily available in the State of California.

City of Seal Beach
Last Ten Fiscal Years
Ratio of General Bonded Debt Outstanding
General bonded debt is debt payable with governmental fund resources and general obligation bonds recorded in enterprise 162
2022-23 Assessed Valuation: $7,289,725,900
Total Debt City’s Share of
OVERLAPPING TAX AND ASSESSMENT DEBT: 6/30/2024 % Applicable (1) Debt 6/30/24 Metropolitan Water District $18,210,000 0.19% $34,235
Coast Community College District 886,956,084 2.906 25,774,944 North Orange Jt. Community College District 291,560,678 1.141 3,326,707 Los Alamitos Unified School District
School Facilities Improvement District No. 1 215,670,227 48.383 104,347,726 Huntington Beach Union High School District 137,329,998 0.001 1,373 Ocean View School District 150,895,000 0.003 4,527
City of Seal Beach Community Facilities District No. 2002-1 2,360,000 100 2,360,000 City of Seal Beach Community Facilities District No. 2005-1 6,410,000 100 6,410,000 TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT $142,259,512
DIRECT AND OVERLAPPING GENERAL FUND DEBT:

Orange County General Fund Obligations $440,385,000 0.95% $4,170,446 Orange County Board of Education Certificates of Participation 10,030,000 0.947 94,984 Coast Community College District Certificates of Participation 1,075,000 2.906 31,240 Coast Community College District Pension Obligation Bonds 925,000 2.906 26,881 Los Alamitos Unified School District Certificates of Participation 30,432,816 53.609 16,314,728 Huntington Beach Union High School District General Fund Obligations 51,436,090 0.001 514 Ocean View School District General Fund Obligations 12,725,000 0.003 382 North Orange County Regional Occupation Program
Certificates of Participation 7,350,000 4.377 321,710
City of Seal Beach 4,550,936 100 4,550,936
TOTAL DIRECT AND OVERLAPPING GENERAL FUND DEBT $25,511,821 COMBINED TOTAL DEBT $167,771,333 (2)
(1) The percentage of overlapping debt applicable to the city is estimated using taxable assessed property value. Applicable percentages were estimated by determining the portion of the overlapping district's assessed value that is within the boundaries of the city divided by the district's total taxable assessed value.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations.

Ratios to 2023-24 Assessed Valuation:

Total Overlapping Tax and Assessment Debt 1.95%
Total Direct Debt 0.06%
Combined Total Debt 2.30%
June 30, 2024
Schedule of Direct and Overlapping Debt
City of Seal Beach
163
2015 2016 2017 2018 2019
Debt limit 817,720,762 $ 846,747,277 $ 820,537,899 $ 860,757,686 $ 892,030,484 $ Total net debt applicable to limit - - - - -
Legal debt margin 817,720,762 $ 846,747,277 $ 820,537,899 $ 860,757,686 $ 892,030,484 $ Total debt applicable to the limit
as a percentage of debt limit 0.0% 0.0% 0.0% 0.0% 0.0%
Note: 1
Under state finance law, the City of Seal Beach's outstanding general obligation debt should not exceed 15 percent of total assessed property value. By law, the general obligation debt subject to the limitation may be offset by amounts set aside for repaying general obligation bonds.

Source: Orange County Tax Assessor's Office
City of Seal Beach
Legal Debt Margin Information
Last Ten Years
164
2020 2021 2022 2023 2024
Debt limit 952,282,846 $ 930,063,188 $ 960,333,816 $ 1,028,618,366 $ 1,093,458,885 $ Total net debt applicable to limit - - - - -
Legal debt margin 952,282,846 $ 930,063,188 $ 960,333,816 $ 1,028,618,366 $ 1,093,458,885 $ Total debt applicable to the limit
as a percentage of debt limit 0.0% 0.0% 0.0% 0.0% 0.0%
Legal Debt Margin Calculation for Fiscal Year 2024
Assessed Valuation 7,289,725,900 $
Debt percentage 1 15%
Debt limit 1,093,458,885 $
Debt applicable to limit -
Legal debt margin 1,093,458,885 $
Note: 1
Under state finance law, the City of Seal Beach's outstanding general obligation debt should not exceed 15 percent of total assessed property value. By law, the general obligation debt subject to the limitation may be offset by amounts set aside for repaying general obligation bonds.

Source: Orange County Tax Assessor's Office
City of Seal Beach
Legal Debt Margin Information (Continued)
Last Ten Years
165
Fiscal Year
Ended Tax
June 30 Increment Principal Interest Coverage
2015 1,084,135 515,000 204,269 1.51
2016 1,329,344 545,000 177,413 1.84
2017 1,218,363 575,000 148,759 1.68
2018 1,125,053 600,000 118,302 1.57
2019 1,198,637 635,000 86,013 1.66
2020 234,102 605,000 53,078 0.36
2021 530,978 160,000 32,519 2.76
2022 - - - -
2023 - - - -
2024 - - - -
Source: Finance Department, City of Seal Beach

Last Ten Fiscal Years
Pledged-Revenue Coverage
City of Seal Beach
Debt Service
Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements. 2000 Tax Allocation Refunding Bonds
The bonds were fully paid off during the year ended June 30, 2021. 166

Personal Per Capita
Calendar Income Personal Unemployment
Year Population (in thousands) Income Rate
2014 24,586 1,074,777 43,715 4.8%
2015 25,078 1,141,053 45,500 3.9%
2016 24,890 1,164,182 46,773 3.5%
2017 25,984 1,199,969 46,181 3.2%
2018 25,073 1,277,436 50,948 3.3%
2019 24,992 1,370,609 54,841 3.2%
2020 24,443 1,398,936 57,232 8.2%
2021 24,846 1,426,979 57,432 6.0%
2022 24,647 1,538,564 62,423 3.4%
2023 24,350 1,649,508 67,741 3.9%
Sources: HDL Coren & Cone
City of Seal Beach
Demographic and Economic Statistics
Last Ten Calendar Years
167
Business
Business Name 2023 2014 Category
76 X X Service Stations
Bed Bath & Beyond X Home Furnishings
Boeing X Transporation-Non-Auto
Burlington X Family Apparel
Chevron X X Service Stations
Chevron X X Service Stations
Chevron X Service Stations
Chick Fil A X Quick-Service Restaurants
CVS Pharmacy X X Drug Stores
Energy Tubulars X X Petroleum Prod/Equip
EVLO Energy Storage X Energy/Utilities
Hoff's Hut X Casual Dining
Home Goods X X Home Furnishings
In N Out Burgers X X Quick-Service Restaurants
Kohls X X Department Stores
Marshalls X X Family Apparel
Mobil X X Service Stations
Old Ranch Country Club X X Leisure/Entertainment
Original Parts Group X Automotive Supply Stores
Pavillions X X Grocery Stores Liquor
Petsmart X X Specialty Stores
Ralphs X X Grocery Stores Liquor
Roger Dunn Golf Shop X X Sporting Goods/Bike Stores
Seal Beach Chevron X Service Stations
Spaghettini X X Fine Dining
Sprouts Farmers Market X Grocery Stores
Staples X Office Supplies/Furniture
Target X X Discount Dept Stores
Toys R Us X Specialty Stores
Ulta Beauty X X Specialty Stores
Walts Wharf X X Fine Dining
2023 Percent of Calendar Year Total Paid by Top 25 Accounts = 56.01% 2014 Percent of Calendar Year Total Paid by Top 25 Accounts = 61.92% Firms Listed Alphabetically: Period January - December
Source: Hinderliter, de Llamas & Associates, State Board of Equalization, CDTFA, State Controller's Office City of Seal Beach
Current Year and Nine Years Ago
Top 25 Sales Tax Producers
168
Function 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024* General government 14.64 14.34 15.92 13.00 13.48 13.48 14.75 21.35 21.25 21.82 Public safety 79.13 74.12 77.19 78.50 79.82 79.82 80.78 82.05 86.90 84.02 Public works 10.94 4.97 3.98 6.00 5.00 5.00 17.99 17.99 17.69 17.30 Community
development/Services 18.16 17.25 16.53 13.60 14.76 14.76 13.88 13.50 12.44 17.22 Water 13.80 13.82 12.60 12.90 13.15 13.15 8.90 8.90 7.45 8.60 Sewer 5.91 7.11 7.69 6.71 6.89 6.89 5.86 5.86 6.99 6.56 Total 128.26 142.58 131.61 133.91 130.71 133.10 142.16 149.65 152.72 155.52 Source: Finance Department, City of Seal Beach
*Position count includes contracted employees in Community Development Total full-time equivalents exclude Commissioners and Reserve Officers but includes Council Members Fiscal Year
Last Ten Fiscal Years
Full-Time and Part-Time City Employees by Function
City of Seal Beach
169
2015 2016 2017 2018 2019
Police:

Arrests 798 790 781 854 787
Parking citations issued 21,043 19,264 18,319 19,929 17,663 Public works:

Street centerline miles resurfaced 2 1 - 1 1
Number of public right of way permits issued 151 184 259 231 253 Number of street related service requests 45 40 68 109 92 Parks and recreation:

Number of recreation classes 781 680 710 1,070 1,100
Number of facility rentals 2,633 557 585 1,030 1,045
Water:

Number of water meters replaced 57 76 56 49 49
Acre feet of water used 3,540 3,208 3,259 3,208 3,360
Sewer:

Number of feet of sewer cleaned 253,099 217,619 - 217,619 154,000 Number of catch basins cleaned 434 458 216 216 216
Source: City of Seal Beach
Fiscal Year
City of Seal Beach
Operating Indicators by Function
Last Ten Fiscal Years
170
2020 2021 2022 2023 2024
Police:

Arrests 709 806 1,429 809 1,010
Parking citations issued 20,913 28,644 29,658 24,841 22,985 Public works:

Street centerline miles resurfaced 4 3 1 1 4
Number of public right of way permits issued 242 232 213 213 250 Number of street related service requests 44 39 258 258 300 Parks and recreation:

Number of recreation classes 790 1,113 955 828 752
Number of facility rentals 690 314 1,020 773 1,765
Water:

Number of water meters replaced 104 154 89 89 98
Acre feet of water used 3,276 3,471 3,086 3,086 3,331
Sewer:

Number of feet of sewer cleaned 146,619 126,563 190,569 190,569 105,607 Number of catch basins cleaned 216 217 218 218 454
Source: City of Seal Beach
Last Ten Fiscal Years
Operating Indicators by Function (Continued)
City of Seal Beach
Fiscal Year
171
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Police:

Stations 2222222222
Patrol units 34 34 34 34 34 34 34 34 34 34
Public works:

Streets (center line miles) 43 43 43 43 43 43 43 43 43 43 Sidewalk (miles) 86 86 86 86 86 86 86 86 86 86
Signalized intersections 23 23 23 23 23 23 23 22 22 22
Parks and recreation:

Parks 10 10 10 10 10 10 10 13 13 13
Community centers 3333333555
Water:

Water pipe (miles) 72 72 72 72 72 72 72 72 72 72
Reservoirs 2222222222
Sewer
Sanitary sewers (miles) 37 37 37 37 37 37 37 37 37 37
Storm sewers (miles) 4444444444
Sewer lift/pump stations 7777777666
Source: City of Seal Beach
City of Seal Beach
Capital Asset Statistics by Function
Last Ten Fiscal Years
Fiscal Year
172

THE CITY OF SEAL BEACH

PROVIDES EXCELLENT CITY

SERVICES TO ENHANCE THE

QUALITY OF LIFE AND TO

PRESERVE OUR SMALL TOWN
CHARACTER.

THE CITY OF SEAL BEACH

PROVIDES EXCELLENT CITY

SERVICES TO ENHANCE THE

QUALITY OF LIFE AND TO

PRESERVE OUR SMALL TOWN
CHARACTER.

THE CITY OF SEAL BEACH
VALUES:

EXCELLENT CUSTOMER

SERVICE

MUTUAL RESPECT

TEAMWORK

PROFESSIONALISM

HONEST & ETHICAL BEHAVIOR

THE CITY OF SEAL BEACH
VALUES:

EXCELLENT CUSTOMER

SERVICE

MUTUAL RESPECT

TEAMWORK

PROFESSIONALISM

HONEST & ETHICAL BEHAVIOR
City of Seal Beach
Seal Beach, California
Independent Accountants’ Report on
Applying Agreed-Upon Procedures to
Appropriations Limit Schedule
For the Year Ending June 30, 2024
200 E. Sandpointe Avenue, Suite 600
Santa Ana, California 92707
INDEPENDENT ACCOUNTANTS’ REPORT ON

APPLYING AGREED-UPON PROCEDURES
To the Honorable Mayor and Members of City Council
of the City of Seal Beach
Seal Beach, California
We have performed the procedures enumerated below to the accompanying appropriation limit schedule of the City of Seal Beach, California (the “City”) for the year ending June 30, 2024. The management of the City is responsible for the Appropriations Limit Schedule.

The City has agreed to and acknowledged that the procedures performed are appropriate to meet the intended purpose in meeting the requirements of Section 1.5 of Article XIII-B of the California Constitution, which was agreed to by the City and the League of California Cities (as presented int eh publication entitled Agreed-upon Procedures Applied to the Appropriations Limitation Prescribed by Article XIII-B of the California Constitution). This report may not be suitable for any other purpose. The procedures performed may not address all the items of interest to a user of this report and may not meet the needs of all users of this report and, as such, users are responsible for determining whether the procedures performed are appropriate for their purposes.

The procedures performed and associated findings are as follows:

1. We obtained the completed worksheets used by the City to calculate its appropriations limit for the year ending June 30, 2024, and verified that the limit and annual calculation factors were adopted by resolution of the City Council. We also verified that the population and inflation options were selected by a recorded vote of the City Council.

Finding: No exceptions were noted as a result of our procedures.

2. For the accompanying Appropriations Limit Schedule, we added the prior year’s limit to the total adjustments, and agreed the resulting amount to the current year’s limit.

Finding: No exceptions were noted as a result of our procedures.

3. We verified the current year information presented in the accompanying Appropriations Limit Schedule to corresponding information in worksheets used by the City.

Finding: No exceptions were noted as a result of our procedures.

4. We verified the appropriations limit presented in the accompanying Appropriations Limit Schedule to the appropriations limit adopted by the City Council.

Finding: No exceptions were noted as a result of our procedures.

To the Honorable Mayor and Members of City Council
of the City of Seal Beach
Seal Beach, California

Page 2 ends

Seal Beach City CouncilFebruary 24, 2025

Seal Beach City Council
February 24, 2025