South Gate City Council
January 24, 2023

568
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022 3 MUNICIPAL CODE ADMIN
CONT'D Works Department will be able to issue permits, they do not need to establish a fee because they will be applying the standard utility cut fee which is 296 dollars for the first hundred linear fee and an addition of $75 dollars per additional liner fee.

Mayor Rios asked if anyone in the audience and zoom wished to speak on this item.

Virginia Johnson is wondering if there is any statistics on the safety of burrowing down 24 inches as opposed to what is now 36 inches and more.

Ask if the fiber optics would be coming to the surface easier.

Thomas Buckley explains that a lot of people in the community don't understand the importance or the benefit of fiber optics. He explains that he recently upgraded to fiber optics, and he wants to trust the importance of having it in the city. He explains that he changed internet and got fiber optics which have speed up his internet, he also says that it is a very green and efficient way, and it might help with the rolling black outs that the city has.

Having no one else come forward, Mayor Rios closed the audience portion,
Council Member Hurtado explains that this senate bill was passed almost a year ago and asks why it has taken so long. Also, would like to know if they are in violation of anything if they don't update it and if so, are there any conseqriences. He can see the benefit, but he is just asking the questions.

Mr. Cervantes explains that he doesn't specifically know if the city is in violation of anything per se. The current municipal code if they had received an application, they could have considered it but because they haven't received any applications so there isn't a strict prohibition in micro trenching right now, but the City Attorney's Office determined that the city municipal code needed to be modified to eliminate any of the current prohibitions and he goes into further detail explaining the difference.

Council Member Hurtado explains that they recently had a change in the trash hauling and some laws were changed, and they finally acted because they were on the brink of being fined almost 10,000 dollars per day of violation. When they have senate bills at the state level, he just wants to make sure that they are following the niles.

Vice Mayor Avalos asks if they have any other fiber optics now.

569
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022 3 MUNICIPAL CODE ADMIN
CONT'D Mr. Cervantes explains that they have not had any companies reach out yet now. They are not sure which companies are doing that work right now.

Mayor Rios asks if they are using the telephone wiring above or is this new.

Mr. Cervantes says he doesn't know because it will depend on the provider. He explains that he is not sure but now that they are allowed to micro trench any company is going to depend on who the provider is.

LICENSES & PERfVIITS The City Council at the conclusion of the public hearing, waived the reading in full and introduced Ordinance No. 2022-09-CC entitled - Ordinance of the City Council of the City of South, California, granting a five-year franchise agreement to Torrance Pipeline Company, LLC, to use, maintain, repair and replace a single pipeline beneath specified public streets, together with related appurtenances, for transmitting and distributing oil and oil products, by motion of Vice Mayor Avalos and seconded by Council Member Hurtado.

ROLL CALL: Council Member Hurtado, yes; Council Member Davila, yes; Vice Mayor Avalos, yes; Mayor Rios, yes; Council Member Diaz, absent.

Arturo Cervantes, Director of Public Works explains that the city regulates oil pipelines in the public right-of-way through franchise agreements and the Torrance Pipeline is one of the existing pipelines that is in the city.

They operate a pipeline from the Torrance refinery to the city of South Gate. The Torrance Pipeline is asking that their franchise agreement be renewed because their current franchise agreement has expired. The recommended franchise agreement is a five-year term from September 2021 to September 2026. He talks about the recommended safety agreement that is required by state and local governments. He explains that the new franchise agreement increases the revenue to the general fund and explains the difference of the increase.

Mayor Rios asked if anyone in the audience and zoom wished to speak on this item.

Yodit Glaze, City Clerk read an email from resident Joshua Barron asking about the annual increase. He asked if it is in line with what other cities charge for similar pipelines. He would like to know the total revenue it will generate by the pipeline that goes through our city and what is the percentage generated for the city. The resident explains that if they are asking the businesses to pay their fair share of the business license then

570
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022 4 LICENSES & PERMITS
CONT'D these companies that are utilizing the city's land and space and have potential for large interniptions if anything bad happens. They should pay their fair share.

Having no one else come forward, Mayor Rios closed the audience portion.

Mr. Cervantes explains that with regards to the franchise fees the Public Utility Commission provides tmee options for setting the fees. These fees were set on a fortnula that they use to negotiate the fees. They have franchise agreements with another agency, and they negotiated this fee.

This is the highest amount that Torrance Pipeline pays to any city for the pipeline, and they believe that for both the city and the Torrance Pipeline this is good. Regarding the total revenue of the Torrance Pipeline that is not information that they received, and they do not have available because it is a pipeline that is just passing through the city. He also explains that the total fee is not related to the total revenue of the Torrance Pipeline.

The third is regarding the business licenses that they issue regarding the pipeline they charge fees in which they have the right to operate and go through the city.

Council Member Hurtado says they are working on the business licenses, and they have other areas where they are still deficient, and he provides examples. He asks if the dollar amount that they are asking for is a fair amount and is there a way that they can compare it to other cities. Again, it is important to ensure they are getting a fair amount from the people who have big companies. Asks the City Manager if they are comfortable with the amount they are receiving from these companies.

City Manager explains that they brought this item to them a few months ago and they asked for it to be continued because Torrance objected to what they were proposing. He thanks the City Attorney's Office for negotiating during this process. He explains that from the cities that this pipeline passes through they are the second highest only behind the city of Los Angeles. This is a five-year agreement and at the end of that stage it does allow for a more comprehensive view of what that fee is.

Council Member Hurtado explains that he is looking at the jump and even though it looks good he is wondering how much they lost in fees in the prevtous year.

City Attorney explains that he is not sure that the city lost anything the entire agreement was the subject of negotiations and Mr. Jeffers brought a new perspective and there was a delay in bringing this back because there was ongoing negotiations with the lawyers for Torrance. He believes that it will work to the city's advantage in the long term. He does believe that

571
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022 4 LICENSES & PERMITS
CONT'D this was a very transparent process, and it brings the city almost to the same level as the city of Los Angeles.

Council Member Hurtado clarifies his comment that it is not that they lost in the previous year but the gap that they increased it by is substantial. He asks if there was an opportunity the previous year to have had slightly a hire number because it is a big jump, and he is glad that the staff was able to achieve that.

Vice Mayor Avalos explains her concern for liability safety and how often Torrance checks their pipes to make sure there isn't any leakage.

Mr. Cervantes explains that when it comes to safety the Torrance Pipeline is required to abide by state and federal requirements and the agency responsible for that is the state federal marshal. They have a set of requirements that must be met, the franchise agreement sets the structure that they require to comply. In regard to how many times they check their pipes he is not sure but they are required to do an annual inspection of their pipes. The previous inspection the state fire marshal had no findings with regards to the pipeline, this gives some insight into the maintenance of the pipes.

Council Member Davila asks how often the pipes get checked.

Mr. Cervantes explains that by the state fire marshal, the pipeline is checked annually.

Mayor Rios asks if they have several of these pipelines.

Arturo Cervantes explains that there are several pipes.

LAW ENFORCEMENT The City Council considered at the conclrision of the public hearing:
a. Authorizing utilization of 2020 Homeland Security Grant Program Funds in the amount of $14,185 for the purchase of communications equipment and accessories, plus installation, for the Police Department;
b. Increasing the Fiscal Year 2022/23 revenue projection in Account Number 232-541 (Law Enforcement Grants - Homeland Security Grant) to $14,185;
C. Amending the Fiscal Year 2022/23 Law Enforcement Grants Fund Budget by appropriating $14,185 to Account Number 232-541-21- 6204 (Law Enforcement Grants - Homeland Security Grant - Small

572
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022 5 LAW ENFORCEMENT
CONT'D Tools & Equipment) for the purchase of unit radios, portable radios, charging stations and accessories; and
d. Authorizing the City Manager to execute the State Homeland Security Grant Program Subrecipient Agreement for Grant Year 2020.

Chief Arakawa explains that the state of California has allocated funds throughout the state, and it is given to LA County and South Gate was the recipient of about $14,185. He asks that this item be continued to a date to be determined they did an inventory of the equipment, and they have enough equipment so now they would like to transition that money into a different area perhaps training.

Mayor Rios asked if anyone in the audience or zoom wished to speak on tl'iis item. Seeing no one step forward; Mayor Rios closed the audience portion.

This item was moved to a fiiture City Council meeting by motion of Vice Mayor Avalos and seconded by Council Member Hurtado.

ROLL CALL: Council Member Hurtado, yes; Council Member Davila, yes; Vice Mayor Avalos, yes; Mayor Rios, yes; Council Member Diaz, absent.

COMMENTS FROM THE

AUDIENCE - NON-
AGENDA ITEMS Virginia Johnson thanked the graffiti and public works department for their speedy removal of new graffiti and trash that is thrown in the city.

On Circle Park taking six and a half million dollars to.put into a new park project doesn't make sense to her. Hopes to see Jovaru'ii Laborin and Joshua Barron on the upcoming Council seats. She thanked Andrea Paulino and the Smiths for their continuing efforts in trying to keep area five clean and vandal free. She also praises Mary Castillo for the work she does to fix some of the things going on in her neighborhood. Lastly, she hopes the city can remind everyone that the November 8'h Council meeting will be postponed.

Sandy Rodriguez is here as the immediate past president of the South Gate Kiwanis Club to invite everyone to the next Kiwanis clean-up. It will be taking place October 17'h, this Saturday from 9am - 10:30. This month they will be cleaning up the area by Dearborn and Firestone, and she explains that they chose this area because the South Gate football and cheer will be having games all day at the South Gate High School.

573
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022

COMMENTS FROM THE

AUDIENCE - NON-
AGENDA ITEMS CONT'D Armando Velasquez is the current President of the South Gate Kiwanis Club thanked Mayor Rios, because a couple of weeks ago there was a big recognition ceremony for People Latino Heritage month. Mayor Rios was one of those that was recognized and every one that was recognized got to pick a non-profit for a 2,000-dollar donation. Explains that others picked more regional and national charities, but Mayor Rios picked a local South Gate non-profit which was the Kiwanis. He stated that this upcoming Monday is going to be a big day for the community and for the Kiwanis they will be having a hybrid meeting and it will also be the beginning for their new 501C3 non-profit the South Gate Kiwanis Club foundation.

Which they will be appointing officers' directors and it will be a separate entity that will be connected to the South Gate Kiwanis Club. He explains the positions they have and the people that will be filling those positions.

Explains that this is going to be one of the very few non-profits that are going to be 501C3 and says that it will make them very attractive. He explains there will be an installation banquet to install the general officer it will be October 22nd in the city of Whittier, and he will be passing out the flyers about the event.

Olivia Gonzales is a property owner that has owned several properties in the city of South Gate. The reason she has come in is because they have called several divisions in the city of South Gate regarding a property they have, and the tree is so big and overgrown that the sidewalk is lifting. She explains that she and her husband see it as a potential lawsuit against the city of South Gate. Explains that they have another property on Alexander and the driveway is so narrow and there has been several traffic violations and she is scared that something will happen because the house is on the corner, and they have been living there for a long time. Explains that the bike lane makes it difficult to come in and out, she asks if they can paint the curb in front of her house red and she will be willing to do a traffic study.

Alejandro Gonzales, South Gate resident, states the current situation in South Gate is bad and not just on his property but everywhere else. He says that there are several streets that are falling apart. He explains that on Alexander there was a branch that dropped, and it was picked-up yesterday. He explained that he called regarding the tree on his property (mentioned above by his wife) and was told to call back in six weeks and they went to the property and said they might do this in October, and they have not seen anything.

Council Member Hurtado asks if he emailed all Council Members.

Alejandro Gonzales clarifies that he called public works and he assumed they would have taken notes becarise he left his name and information, and no one has gone to the property. He says that the property is a big risk.

574
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022

COMMENTS FROM THE

AUDIENCE - NON-
AGENDA ITEMS CONT'D Council Member Hurtado apologizes and says they are not supposed to go back and forth during this part of the meeting. He was only asking to clarify because he gets those emails, and he forwards them to staff to get someone out there and check it out and says that if he missed that then he apologizes.

Joe Pacheco asked Council to reinstate the five-minute audience time. He understands that people say things the Council doesn't like, and it takes up time, but he believes that the community has legitimate concerns and issues, they would like to make the Council aware of. Says the Council should work together with the community to answer questions on the matters that are important to the community. Says he brought up a petition two weeks ago to talk about the issues that are happening on their street.

He explains that they have been through the process that the city has put out to get things taken care of only to be told they have to pay for the application. Explains he wasted a lot of time trying to fix the traffic on the street along with vandalism or graffiti and asks that the city take up the cost of the study because the residents that know what is going on in the community. Asks that for money the city is getting, he asks that they be a good steward and use the money for things that are necessary to fix the community.

Delfino, South Gate resident, explains that in the past couple of years everything was better than it was now because drop offs at schools are difficult. Explains that now he never sees the ticket people and the person who takes care of the kids they used to put cones to protect the space but now they just look from the front door, and everyone is blocking the streets and it is a mess. He talks about a time where he got a ticket and he tried to appeal it because it was given out wrong and he was following the niles. He paid the ticket and explained that he didn't really mind. Ask the council to please send someone to enforce the rules in the morning.

Council Member Davila asks him if he can leave his phone number and name and infornnation along with the school he is talking about and thanks him for his time.

Mario Dominguez stated last Council meeting, money was given to take care of the vets which is great, but now he would like the Council to place an item on the agenda to put two thousand dollars from the general fund to pay for the cameras in the Council Chambers. He has done research about cities that pay for cameras to be installed in the Council Chambers and he names all the cities that have cameras and goes into detail about where they have them. He speaks regarding Mr. Buckley's website and would like the City Attorney to sue them for copy right infringement because he is using that with the South Gate Police Scanner, and it is confusing for the residents because they don't know what it is, and they believe that it

575
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022

COMMENTS FROM THE
AtJDIENCE - NON-
AGENDA ITEMS corq'r'n has something to do with the South Gate PD. He would like Mr. Salinas to send a cease and desist to Mr. Buckley and rename the website because residents believe it is tied to South Gate PD.

Thomas Buckley starts of by commending Sandra from the Building and Safety Division because he emailed her regarding a neighborhood member question, and she answered promptly and warmly. To the current candidate he encourages them to remain as classy as possible this political season with that said all the candidates are trying to stay on their best behavior and the cotnrnunity thanks them for that. He continues by speaking for a resident, explains that this Council should learn from the LA City Council and that they are being very greedy by not wanting to step down and hopes that this does not happen to the South Gate Council.

Regarding the fiber optics he has his with AT&T and it works just fine.

Alice agrees with Mr. Dominguez regarding his comments on the cameras.

She is here because several weeks ago they voted and sent off a letter that was agree by with council and she did not agree with it. Another city has also sent a letter to Los Angeles Council condemning their comments. She thinks that as a City Council they should also come out in writing however they want condemning the LA City Council.

Liz Ruiz has been appointed to the Department of Toxic Substances Control and as a part of their mandate, they are set to approve the Hazard Waste Management Plan which is due in March 2023. She would like the public to participate by commenting and providing questions on the report via email and she provides the email. Cornrnents need to be submitted by September 1, to be considered and comments submitted after will be considered for the next phase. She goes over the process of this management plan and explains what it consists of and includes. Speaking as a resident of South Gate she has been doing some campaigning for a member that is running for office, and she hopes that they come together and address some of the concerns that the residents are bringing up.

City Clerk Glaze has received three emails that she would like to read. The first one states that they have been a city resident for over fifty years, and she is concerned about recent rants that Mr. Montalvo has said at the defund the police rally some time ago. He and his wife along with other residents were disgusted by the remarks he made on the bullhorn like saying that the police were going to kill their children and calling the officers names. Next, he is going to call everyone liars to protect his reputation and if anyone is running for office, they should maintain a good relationship with the officers but if he is in office, it seems unlikely. He is a former police officer and veteran, and he does not speak for me or for veterans as he would like you to believe. The South Gate Scanner page is a joke talk about free speech and if you post a comment that he does not

576
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022

COMMENTS FROM THE

AUDIENCE - NON-
AGENDA ITEMS CONT'D agree with you are moved from the page. The second public comment explains that it is campaign season, and it should be about the issues that impact the city and candidates should campaign with their best foot forward. The resident understands that not everyone is perfect but lying should be called out. They are also concerned about the image being portrayed on the scanner page the resident had friends who thought the page was run by the city.

City Attorney Salinas internupts and clarifies that the scanner page is not with the city and that the purpose of public comment is to talk about things that are within jurisdiction of the city so if the subject of that email relates to the public scanner, then they can just file it because it is not appropriate City Clerk Glaze explains that the last one is also similar.

City Attorney Salinas suggests that the City Clerk provide copies of that to the City Council so they could have it and add it to the meetings. Again, the City Manager gave a presentation of public comment at City Council meeting, and they must talk about things that are within the jurisdiction of the city, and they should be mindful of that when they made cornrnents.

Mayor Rios thanks the City Attorney for the clarification.

Council Member Hurtado agrees and suggest that when the City Clerk get those, she should review them before they start with public comments.

REPORTS AND COMMENTS
FROM CITY OFFICIALS City Manager Jeffers says that with regards to the tree issue they will have staff go out and have a response and they will also inform Council. As far as the driveway issue he will talk to Mr. Cervantes, but it might be an issue of expanding the driveway just looking across the street in this picture. It looks like the other driveways in the neighborhood are wider and that may accomplish that process, but he will talk to Mr. Cervantes a little bit more about that and they will get in contact. The resident that commented about traffic issues they will give that information to the police and let them handle that issue.

Meredith Elguira, Director of Community Development stated that the Housing Manager started yesterday and will be introduce at the next meeting.

Vice Mayor Avalos asks if they can have a little background as to who the Housing Manager is.

Mayor Rios clarifies that she will be here next meeting so they should do it then.

577
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022

REPORTS AND COMMENTS

FROM CITY OFFICIALS
CONT'D Steve Costley, Interim Director of Parks & Recreation stated this Saturday is their second annual Art Walk it will be in front of the civic center and they have over 45 different vendors. They also have a Mi Barrio event, and it will open the same time as the Art Walk. Secondly Halloween is coming and all the events this year will take place at South Gate Park due to the construction of Hollydale Park. They expect a large crowd, and he explains they could always use judges for the Halloween costume contests and other things. Next is Veterans Day event that will be taking place on November 11th at 10am at the Veterans Fountain. Lastly the Pageant of the Trees event is on December 3rd, it is put on by the Commission of South Gate Youth, it helps sponsor the South Gate youth and everyone is welcome to join. If anyone would like to do a tree that will be auctioned off, they are welcome to.

Arturo Cervantes, Director of Public Works nothing to report.

Kris Ryan, Director of Administrative Services nothing to report.

Chief Arakawa says they are celebrating Red Ribbon week and they will be doing a couple of presentations on fentanyl awareness one will be on Tuesday evening the 25'h and the following day at Saint Helens church.

There will be another one on Saturday at the park and they are working to get live stream up for that one.

Council Member Davila says that the church across the street wanted a presentation during their service.

Chief Arakawa will reach out to them and do the best they can which is also why they are going to live stream them.

City Treasurer Martinez nothing to report.

City Clerk Glaze stated that the League of Women Voters are coming to our municipal auditorium on October 18'h for a candidate forum they are hosting. If anyone would like to come it starts at 6:30pm. Also, like Virginia Johnson mentioned the Council meeting for Tuesday, November 8'h will be held on Thursday, November lOIh.

City Manager Jeffers explains that they are in the process of transitioning their solid waste to a new provider that will begin January Ist and they have been having meetings to ensure a smooth transitioning process. Next meeting, they will create a presentation to show where they are at and some key details that will be happening in the next six weeks as far as the outreach effort. That will be coming next meeting and they will also be having a job fair for people to fill key positions as part of this contract it will be on the 22nd and people can go to the web page and find out

578
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022

REPORTS AND COMMENTS
(yuou CITY OFFICIALS information about that. Just a reminder that the park opening with RMC will be happening this week and thanks the investors that have invested in the park and the community.

City Attoi'ney Salinas explains that tliere are things that happen outside of the community that they caru'iot stay silent about like what happened in the Los Angeles Corincil. He explains that there is nothing that they could do, and he understands there is a strong disgust and calls for them to resign.

He understands that some residents are asking why the Council hasn't said anything and he explains that it requires an agenda item but that wasn't on today's agenda.

Council Member Hurtado says that the parks are used a lot, and over the last few days there have been lots of events like a softball tournament, horseshoe competition, and the regular activities. He has had the opportunity to speak with residents and they are very impressed with the way that park staff and public works have been maintaining the parks. He explains that there are some things that can be improved, and he understands that there are lots of people that go to those parks but says the maintenance they have done has been great. Also, the graffiti removal staff, he was really impressed with the removal of graffiti in the cornrnunity and explains that when it is removed the graffiti goes back up again and he would like to stress that they are doing their part in trying to address those issues. He explains that the people that see him on an iPad is because he is on the agenda because he doesn't like to waste paper. He asks the City Manager what it would take to get rid of paper agendas and he also asked in the past to look into getting cameras in the Council Chamber for the people at home to see. He asks if it is something that they can consider, and the City Attorney touched on the issues that happened in LA and he condemns the conversations they had.

Council Member Davila thanks the Kiwanis for all the work they have been doing for the last couple of years since they have started the Kiwanis Club in South Gate and praises them for everything they do for the community. She says that what happened in the LA City Council is unacceptable, she did not want to comment on this, but she thinks it is important and says that they should be accountable for the things they do.

She says it is unacceptable and condemn the things they say.

Vice Mayor Avalos concurs that disappointedly what the Council Members said is disgusting and unacceptable and dehumanizing to the community they serve. Hopes they make the right choice which is to step down. She attended Contract Cities event last week and she explains what they went over and the cities that are represented. Explains that they offer money to match what they do and says she understands they have an ELC under the Police Department but maybe they could look at that and see how they can broaden that in case of an emergency. She also attended an

579
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022 REPORTS AND COMMF.NTS
FROM CITY OFFICIALS opening of a Marsico restaurant here in South Gate and slie attended Anthony Rendon's Orgullo Hispano, and he present three exceptional Hispanic professions. This weekend they will be cutting the ribbon for the Dos Rios Park and will make certain she attends and looks forward to seeing a lot of residents there.

Mayor Rio and Vice Mayor attended the School Collaborative and talks about the concerns they share at the meeting. This weekend they have a lot of events like the Azalea Bowl, Legacy will play that same day against Huntington Park. They will also be handing out the Henry Gonzalez trophy at Legacy and they will also have a parade that will happen on December 1 l'h, if anyone wants to participate, they can join. He talks about the Art Walk that will be happening again. He also praises the Kiwanis Club of South Gate for all the work they do in the cornrnunity and now they are going to be a foundation and he thinks it will help build revenue and opportunities. He complements them for all the good work they do with the youth. He works at the college, and they will be having an enrollment fair in October there will be one in the morning and another one in the a'fl:ernoon. He ends by thanking everyone for their reports.

CONSENT CALENDAR Agenda Items 6, 7, 9, 12 and 13 were approved by motion of Council Member Hurtado and seconded by Vice Mayor Avalos. Items 8, 10 and 11 were removed for separate discussion.

ROLL CALL: Council Member Hurtado, yes; Council Member Davila, yes; Vice Mayor Avalos, yes; Mayor Rios, yes; Council Member Diaz, absent.
6 PUBLIC WORKS/
ENGINEERING ADMIN The City Council approved items A, B and C during Consent Calendar:
a. Resolution No. 2022-61-CC entitled - Resolution of the City Council of the City of South Gate approving the Master Agreement, Administering Agency-State Agreement (Contract No. 2022-89-CC) for State-Funded Projects, No. 07-5257S21 ("Agreement") with the State of California Department of Transportation; and
b. Authorized the Mayor to execute the Agreement in a form acceptable to the City Attorney; and
C. Authorized the City Manager and the Assistant City Manager/Director of Public Works to execute Program Supplement Agreements and other related documents for state funded projects.

580
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022 7 PUBLIC WORKS/
ENGINEERING ADMIN The City Council approved items A, B and C during Consent Calendar:

Amendment No. 8 to Contract No. 3340 with SAFNA Engineering & Consulting, a Division of SAFNA Corporation, formerly a Division of Heateflex Corporation, to provide additional professional services to manage the procurement process for the Integrated Electronic Security System Installation and Monitoring Services, City Project No. 692-GEN, in an amount not to exceed $10,000;
Appropriated $4,000 in Water Funds, $2,000 in Sewer Funds and $4,000 in General Funds for a total of $10,000 to Account No. 311-790-49-9118 to fund Amendment No. 8; and
Authorized the Mayor to execute Amendment No. 8 in a form acceptable to the City Attorney.
8 PUBLIC ASSIST ANCE The City Council approved items A and B by motion of Council Member Hurtado and seconded by Corincil Member Davila:

ROLL CALL: Council Member Davila, yes; Council Member Hurtado, yes; Vice Mayor Avalos, no; Mayor Rios, yes; Council Member Diaz, absent.

Professional Services Agreement (Contract No. 2022-90-CC) with Fiesta Taxi to provide food delivery services in an amount not to exceed $88,000 for services rendered in FY 2021/22 (November through June) and FY 2022/23 (July 1, 2022 - June 30, 2023); and Authorized the Mayor to execute the Professional Services Agreement in a form acceptable to the City Attorney. 9 LAW ENFORCEMENT The City Council approved items A and B during Consent Calendar:

Agreement (Contract No. 2022-91-CC) with All City Management Services, Inc. ("ACMS"), for crossing guard services for a one (1) year term effective July 2, 2022 - June 30, 2023; and Authorized the Mayor to execute the Agreement in a form acceptable to the City Attorney.

581
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022 10 ENERGY - GAS/
ELECTRICITY/PHONE The City Council considered:
a. Appropriating $69,000 from the AQMD Fund Balance and $60,000 in Mobile Source Air Pollution Reduction Review Committee ("MSRC") Grant Funds to Account No. 223-610-49- 9005 to fund construction and software services for the Project; b. Approving an Agreement with Araad Builders, Inc., for the constniction of the Electric Vehicle Charging Stations, City Project No. 636-GEN, in an amount not-to-exceed $131,490;
C. Approving an Agreement with Zevtron, LLC., for Software Services for the Electric Vehicle Charging Stations, City Project No. 636-GEN, in an amount not-to-exceed $9,000;
d. Authorizing the Mayor to execute the Agreements in a form acceptable to the City Attorney; and
e. Approving the Notice of Exemption for the construction of the Project and directing the City Clerk to file it with the Los Angeles County Registrar Recorder's CXfice.

Due to a manufacturers cost increase the contractor is not able to honor the prices and staff is recommending that all bids be rejected in accordance with the rights that the City reserves with the bid process.

The City Corincil approved staf'f' s amended recommendation by motion of Council Member Davila and seconded by Vice Mayor Avalos.

II
LAW ENFORCEMF.NT The City Council approved items A and B by motion of Council Member Davila and seconded by Vice Mayor Avalos:

ROLL CALL: Council Member Davila, yes; Council Member Hurtado, yes; Vice Mayor Avalos, yes; Mayor Rios, yes; Council Member Diaz, absent.
a. Accepting a grant of $10,000 from Marathon Petroleum to be placed in Fund 231 (Law Enforcement Grants); and
b. Approving the purchase of a LOKI Drone System with the $10,000 allocated to Fund 231 (Law Enforcement Grants) and $3,834.20 from Fund 235 (Asset Forfeiture) for a total of $13,834.20 and authorizing the Director of Administrative Services to make the appropriate budget adjustments to the revenue and expenditure accounts.

582
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022 12 LAW ENFORCEMENT Tlie City Council approved items A, B and C during Consent Calendar:

Addendum No. 8 to Contract No. 3130 (Master Equity Lease Agreement) with Enterprise FM Trust to include the lease of a 2022 Dodge Durango for the Police Department for a term of 48 months in the total amount of $57,015;
Appropriated $14,348 from the unassigned balance of the Asset Forfeiture Budget to Account No. 235-570-21-6310 for the first annual lease payment; and
Authorized the Mayor to execute Addendum No. 8 in a form acceptable to the City Attorney.
13 LAW ENFORCEMENT The City Council approved items A, B, C, D, E and F during Consent Calendar:

Purchase Order Agreement with National Auto Fleet Group for the purchase of two patrol vehicles for the Police Department, in the total amount of $100,134.06;
Purchase Order Agreement with West Coast Lights & Sirens, Inc., for the purchase and installation of necessary emergency equipment for the two patrol vehicles, in the amount of $36,898.48;
Purchase Order Agreement with Northstar Grapliics, for the purchase and installation of decals/graphics for two patrol vehicles, in the amount of $720.00;
Purchase Order Agreement with CDCE, Inc., for the purchase of Mobile Data Computers to outfit the two patrol vehicles, in the amount of $16,686.30; and
Purchase Order Agreement with Motorola Solutions, Inc., for the purchase of mobile radios to outfit the two patrol vehicles, in the amount of $19,269.55.

Appropriated an additional $24,669.39 from the Asset Forfeiture Fund to cover the full cost for the two vehicles.

583
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 11, 2022 14 CITY COUNCIL The City Council approved items A and B by motion of Council Member Davila and seconded by Council Member Hurtado:

A draft Vision Statement developed during a recent Strategic Plan workshop; and
Three Strategic Plan Goals of Workforce Development, Fiscal Sustainability and Communication.

IS
WARRANTS The City Council approved the Warrant Register for October 11, 2022, by motion of Vice Mayor Avalos and seconded by Council Member Hurtado.

Total of Checks:

Less: Voids
Less: Employee Payroll Deductions
Grand Total:
$2,704,135.52
$ (4,906.85)
$ (345,263.72)
$2,353,964.95
Cancellations: 97888, 98059, 98089, 98463, 98499, 98200 ADJOURNMENT Mayor Rios adjourned the meeting at 8:59 p.m. in memory of the people who have lost their lives in bombings in {Jkraine and seconded by Council Member Davila. Council Member Diaz was absent.

PASSED and APPROVED this day of 2023.

ATTEST:

Maria del Pilar Avalos, Mayor Yodit Glaze, City Clerk

584

CITY OF SOUTH GATE

SPECIAL CITY COUNCIL MEETING

MINUTES
TUESDAY, OCTOBER 25, 2022
CALL TO ORDER Al Rios, Mayor called a Special City Council Meeting to order at 5:49 p.m.

ROLL CALL Yodit Glaze, City Clerk
PRESENT Mayor Al Rios, Vice Mayor Maria del Pilar Avalos, Council Member Denise Diaz, and Council Member Gil Hurtado; City Manager Chris Jeffers, City Attorney Raul F. Salinas
ABSENT Council Member Maria Davila
LATE City Treasurer Gregory Martinez arrived at 6:37 p.m.

CLOSED SESSION The Council Members recessed into Closed Session at 5 :51 p.m. and reconvened at 6:38 p.m. with four (4) Members of Council present.

Council Member Davila was absent. City Attorney Salinas reported the following:

1. CONFERENCE WITH LEGAL COUNSEL - PENDING

LITIGATION
Pursuant to Government Code Section 54956.9(a),
54954.9(b)(3)(C)
a. Alejandra {Jbiarco v. City of South Gate
Item 1(a) is a claim of someone that fell allegedly on one of the city's sidewalks. The City received a report by the City Attorney and upon completion of that report, there was a motion to deny the claim. The motion was made by Council Member Hurtado and seconded by Vice Mayor Avalos and the vote was 4-0.

2. CONSIDER THE EVALUATION OF PERFORMANCE OF A

PUBLIC EMPLOYEE
Pursuant to Government Code Section 54957(b)(1)
a. City Manager
On Item 2(a), the City Council received a presentation and upon completion of that presentation, there was no reportable action taken. 20 585
SPECIAL CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022 ADJOURNMENT Council Member Hurtado adjourned the meeting at 6:39 p.m. and seconded Vice Mayor Avalos.

PASSED and APPROVED this day of 2023.

ATTEST:

Maria del Pilar Avalos, Mayor Yodit Glaze, City Clerk

586

CITY OF SOUTH GATE

REGULAR CITY COUNCIL MEETING

MINUTES
TUESDAY, OCTOBER 25, 2022
CALL TO ORDER Al Rios, Mayor called a Regular City Council Meeting to order at 6:40 p.m.

INVOCATION Reverend Abner Lima, Community of Hope Church

PLEDGE OF
ALLEGIANCE Liliana Valadez, Police Records Specialist ROLL CALL Yodit Glaze, City Clerk
PRESENT Mayor Al Rios, Vice Mayor Maria del Pilar Avalos, Council Member Denise Diaz, and Council Member Gil Hurtado; City Treasurer Gregory Martinez, City Manager Chris Jeffers, City Attorney Raul F. Salinas ABSENT Council Member Maria Davila
1 PROCLAMATIONS The City Council issue a Proclamation recognizing November 11, 2022, as Veterans Day honoring those who have served our Nation in the Armed Forces.
2 PROCLAMATIONS The City Council issue a Proclamation declaring November 2022 as National Diabetes Month in the City of South Gate. 3 PERSONNEL RE,CRUITMENT
& SELECTION The City Council received the list of new and promotional full-time employees hired or promoted during September 2022. 4 CERTIFICATES The City Council presented Certificates of Appreciation, lawn signs, and azalea plants to (9) awardees selected by the Plaruiing Commission to be recognized for their efforts in maintaining and beautifying their homes. 5A
CERTIFICATES The City Council presented Certificates of Appreciation presented to the Founding Members of the Southeast Los Angeles (SELA) Collaborative. 5 SCHOOLS/EDUCATION The City Council received and filed a report from the Southeast Community Foundation (SCF) on the recently concluded 5-week tutoring program the City and SCF undertook at various LAUSD schools. 22 587
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022 6 COMMUNITY DEV /
HOUSING The City Council opened the public hearing, took public comments, and approved items A, B, C & D by motion of Council Member Diaz and seconded by Mayor Rios.

ROLL CALL: Council Member Diaz, yes; Council Member Hurtado, yes; Vice Mayor Avalos, yes; Mayor Rios, yes; Council Member Davila, absent.
a. Resolution No. 2022-62-CC entitled - Resolution of the City Council of the City of South Gate, California, approving Substantial Amendment No. l to the 2020-2025 CDBG Consolidated Plan; and authorizing the City Manager, or designee, to submit to the U.S.

Department of Housing and Urban Development; and
b. Resolution No. 2022-63-CC entitled - Resolution of the City Council of the City of South Gate, California, approving Substantial Amendment No. 1 to the Fiscal Year 2022-2023 Annual Action Plan re-allocating $43,850 of FY 2020-2021 CDBG funds to the FY 2022- 2023 Commercial Fagade Program, and authorizing the City Manager, or designee, to submit to the U.S. Department of Housing and Urban Development; and
c. Appropriated $43,850 to the CDBG Fund 243 for the Commercial Fagade Program with an equal corresponding increase to grant carryover revenue; and
d. Authorized the City Manager or the Community Development Director to enter into agreements with eligible subrecipients.

Meredith Elguira, Director of Community Development explains that this item came before Council on October 11, 2022, public comments were taken and then it was continued too today. She is requesting Council to open the public comments to hear additional comments. Prior to that they want to reinstate that this consolidated amendment is to add neighborhood preservation added to fiscal years 2020 - 2025. This goal was added back on June 28, 2022, when Council approved the Annual Action Plan for fiscal year 2022 - 2023. In addition to the amendment, they are also requesting a substantial amendment for the 2022- 2023 CDBG Action Plan that would reprogram fagade improvement money from the Tweedy Mile Association to be reprogramed to the city's own fagade improvement program. This was allocated two years ago, and they are reprograming the money to this fiscal year.

Mayor Rios asked if anyone in the audience and zoom wished to speak on this item.

588
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022 Mario Dominguez asked Council to please fix tlie buildings on Tweedy Boulevard. He thinks they look shabby and with all this infrastnicture money coming in those buildings should be upgraded.

Having no one else come forward, Mayor Rios closed the audience portlOn.

COMMENTS FROM THE

AUDIENCE - NON-AGENDA
ITEMS Virginia Johnson says that the time was not long at the candidate forum last week, she is afraid that the candidates were unable to answer all the questions. She wants to make sure that the candidates for council are listening to the needs of the residents. Also says that the businesses across the riverbed need help and refurbishment and explains that the city has not been doing a lot with the general fund and outreach to the businesses. She keeps seeing from her friends on Idaho Avenue that they have been having trouble with the streetlights and they would like to know why the residents must go to the city and Edison company to get this safety issue fixed. She does not know the addresses of the people who are dealing with this issue.

She also thanks Council Member Hurtado for bringing up the streetlights and including area five. Another problem she wanted to bring up is Los Angeles is trying to fix the current problems with adding more Council Members and she explains that the city of Chicago has 50 Council Members, and they are the most cornupt Council. She doesn't believe that it is a good idea to have that many people in the city. Lastly, she doesn't like the 3-minute rule.

Joe Pacheco asks if they could go back to the five minutes so that the residents are able to share their concerns in detail and let them know about the issues that they see daily. Speaking of lights, the lights that were put up on Tweedy are nice and says that the auto zone doesn't have lights which makes it look off. Last meeting, he wanted to ask Mr. Jeffers about the temporary light replacements over the signal lights and he emailed and called the City Manager about this and there has been no response.

Explains that he drives around the city and sees how much it has disintegrated over the years and that the city is old which is why it should be taken care of daily. He asks the Council to focus and try to get the city back better. He says that a couple of months ago they have talked about the parks and new fencing and other renovations, the Council also mentioned a bathroom and explains that the restroom is falling apart.

Another thing that he wants to take notes is that there is a traffic sign that was hit by a car on the center divider sitting on the sidewalk. There is also a tree on the sidewalk, and they must hunch over to get over the branch and now it is where the cars parked.

Liz Ruiz echoed the concerns of the previous speaker about the time especially when it comes to announcements from the Kiwanis. This

589
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022

COMMENTS FROM THE

AUDIENCE - NON-AGENDA
ITEMS CONT'D makes it difficult becarise she feels responsible for keeping the Council and residents updated on what is going on in the city. She is asking Council to reinstate the five-minute time and thinks that cutting the time is not worth it. She raised concerns about the lighting being out on Michigan and Alexander. She also raised concerns about the oyergrown trees, and she hopes that there is funding to expedite the process.

Thomas Buckley stated that all the proclamations lasted about an hour and thirty minutes, and it penalizes the residents because they must wait to speak. Explains that they have reached that point and if they want to talk a lot, he asks them to listen to the audio recording and see how long they take to speak. He explains that the proclamations could be much more efficient if they did not speak as much as they do. He explains that it is insulting when they reduce the time of residents, and they have unlimited time to speak.

Mario Dominguez explains that he wrote three questions for the candidates at the candidate forum, but they were not read. He would like to read two questions the first one is to Mayor Rios, this year he and other residents have been pushing the Council to purchase cameras for the Council Chambers and asks if it is going to happen before this year is over or the next six months. He would appreciate it if he settled this matter. The second question is towards all the candidates, but he wants to direct the question towards the Council. He is prirsing six projects for the city two with South Gate and two with Lynwood, he explains that the projects can be funded through grants, state, and county funding. He asks the Council if they would support projects that would be highly beneficial to the city of South Gate. He would like to know what their commitment to get things done, the third question was to Robert Montalvo, but he will pose the question to him if he wins.

Frank Rivera addressed his concern regarding a bike pass on Southern Avenue and Otis this is the second time he has shared this concern. He has seen an increase in numbers of cars parking there and the trash is piling up and asks the Council to take care of it before it starts getting out of control.

Aaron Thumb was made aware of emails that were sent to the Council regarding members of the American Legion defending their commander.

He explains that he has been aware a lot of fake accounts that Robert Montalvo has created on social media to support his agenda and he has also seen a couple of questionable things he has done. Also, he is the one that is sending those fake emails and asks them to understand that this does not represent the veteran's community and all the staff members. He is also aware that he declined the funding that was proposed at the last council meeting. He would like to propose a non-profit for veterans stand together and he explains what the organization does and asks the Council

590
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022

COMMENTS FROM THE

AUDIENCE - NON-AGENDA
ITEMS CONT'D if the funds could be reappropriated. He is thankful for the consideration and hopes he will be able to elaborate on this soon.

Joshua Barron invited the community to the second annual softball camp toy drive. This is being put on with association with the South Gate PD and South Gate Junior Athletic Association all toys donated will be given to the South Gate Police Department Santa Cop program. He says last year they filled up two cop cars and hopes that this time they are able to fill up two more and try to get as many gifts as possible while also giving instruction to the softball teams. He explains that the minors game will be at 9am and then the major division is for high school players and will start at 10:30 and hopes to see a lot of people there.

Resident calls in regarding to the fake veterans email and says he is not a real veteran he was a reservist and got kicked out.

City Attorney Salinas internipts and explains that this is an opportunity for the public to speak on matters that involve city business. Explains that if it does not have anything to do with city business than he must internipt.

The resident explains that he understands that, but he was just responding to it.

City Attorney Salinas asks to stop the audio.

City Attorney Salinas explains that when it comes to non-profit organizations the regulatory body for any non-profit is the CA Attorney General's Office that oversees charitable organizations, and it does not fall within the business of South Gate. It is on that bases that if the speaker talks about something that is not within the bases of the businesses within South Gate they are allowed to be cut off and that is the basis of what just happened.

Mayor Rios thanks the City Attorney for explaining to the audience what just happened.

South Gate Citizens on Patrol resident explains that she has constantly called regarding illegal dumping on the street and says that if she is not calling in the items that are dumped in front of the apartments on State Street the items sit there for days, to weeks, and sometimes even months.

That causes transients to come in and people consider it a dumping group because it is harder to identify which apartment it is coming from. It was her understanding that there was a Long Beach Coalition that was supposed to drive by and pick up the items. She would like to know what must get done to get it cleaned up, she asks if a truck could pass by once a week or maybe have Code Enforcement Officers figure out and see if they

591
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022

COMMENTS FROM THE

AUDIENCE - NON-AGENDA
ITEMS CONT'D could do something else. She also explains that they had technical issues, and the lights are not working, and she thanks the electrical department for fixing it.

Mayor Rios asks for the street.

South Gate Citizens on Patrol resident says that it is on Deeble Street.

Cyndi Esquivel is here regarding the sidewalks on Tweedy near Walnut and the ones on Wright Road. She says that those lines must really be re- painted because they are not visible and that they are not very visible at night.

City Clerk Yodit would like to read a few emails but would like to let the aridience know how correspondence will be handled moving forward. Any emails received before 12pm on meeting days they will be summarized by the City Clerk. A copy of the email will be provided to the City Council, and it will be available at the City Clerk's Office for public view. She received five emails total from Eddie Blanco, Myra Mendez, Frank Garcia, Tony Marcos, and Jacob Mendez. They have all expressed their concern and disappointment that the Council handled the Veterans' Day dinner by the American Legion on November Ilth
Robert Montalvo thanks Mayor Rios for giving him another opportunity to speak. He wanted to start addressing some of the inconsistences by the City Attorney, he allows people to speak about businesses that have no jurisdiction over the City Council yet when someone calls in, they are cut off. He says this is very inconsistent and unfair and it shows favoritism, and he understands that he will give an explanation, but he is trying to show how it looks to the residents. He talks about being associated with a reputation that is not good and what that says about people. He also explains that people are upset with how they handled the veterans bill and expresses his discontent.

REPORTS AND COMMENTS
FROM CITY OFFICIALS City Manager Jeffers begins by talking about the street light issues that Ms. Johnson spoke about and says they will have someone check on that tomorrow and Public Works will provide Council a report on what they found. He continues by explaining to Mr. Pacheco that they ordered the temporary light poles and that they are still waiting on those because they are in transit at the moment. He also explains that it is a supply chain issue and asks Mr. Cervantes if he has any updates on that.

592
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022

REPORTS AND COMMENTS

FROM CITY OFFICIALS
CONT'D Mr. Cervantes explains that they will begin in January or February when the poles arrive.

City Manager apologizes if he did not respond and explains that he did not receive an email. He repeats that if there are any issues then they can feel free to email him or call him. He doesn't like waiting 2-3 weeks to get on issues that come to him. Explains that the city appropriated money for the street tree lights to be replaced, he appreciates the City Councils trust in getting the light upgraded. Explains that with the street trirnrning Mr. Cervantes has explained that they are in the process of getting a new contractor which was explained at the previous Council meeting and that will start in November. They will be putting together a list for the 12,000 most needy trees and that will be integrated in. On the Southern Avenue bike pass he says that they will look at that and the cars he knows he got a call from Mr. Hurtado this morning and he mentioned the same concerns and he explains that the property is under DWP.

He says that they are going to be reaching out to the people that live in that apartment complex. The illegal dumping items they will be going back in, and he has spoken with her before, and they will be speaking again. He explains that they have a new process coming January Ist and talks about some of the differences they have.

Arturo Cervantes explains that they have been servicing the past several months when it comes to restriping all the cross walks adjacent to the schools. That is happening city wide, and they are marking the curb parking that are adjacent to schools as well. At Wright Road just north of Imperial that issue has been brought to their attention and improvements have been made there. They are working on a second project there to improve crossing improvements with additional crossings.

Possibly with pedestrian button crossings and this project is taking a little bit more time and the process does take a procurement. He explains that there are a lot of projects and they have another that is meant to restripe many crosswalks, he doesn't have the exact number but they are planning to restripe.

He explains that the location on Tweedy and Walnut will be added to the list.

593
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022

REPORTS AND COMMENTS

FROM CITY OFFICIALS
CONT'D Mayor Rios says that he has ben canvassing with a business leader and is interested in doing something like the Tweedy Mile for the businesses on Hollydale. He explains that they will continue moving forward meeting with the businesses on the Hollydale side and discussing having an entity to help move forward the business improvement sector of the businesses.

City Attorney Salinas spoke on the free speech component of tonight. He explains to the public that the public comment period is subject to state law under the Brown Act. The Brown Act gives these opportunities to the public and it has to fall within the subject matter jurisdiction of the city. Explains that if it is outside the cities jurisdiction it is outside the public forum, he continues to explain this and other state statues that follow this policy guideline.

Mayor Rios thanks City Attorney Salinas for explaining that.

He would like to let the audience know that they did approve four million dollars in August for the streetlights and he hopes that it does go for that. They also added money for the tree trimming and there are a lot of other good things coming. He thanks the staff for responding to the comments.

Meredith Elguira, Director of Community Development has nothing to report.

Steve Costley, Interim Director of Parks & Recreation explains that the Art Walk took place two Saturdays ago on the 15th and it was raining in the morning but after it was sunny. He explains that everything went very well a lot of people showed up along with the vendors. They also opened the Mi Barrio Art Exhibit in the art gallery, and he got to meet some of the artist who were young, and they were also exited. Some upcoming things happening is Halloween and it will be busy at the park, he explains that the operation is a little less busy than it used to be because of the pandemic. He says they are still looking for judges and that is going to start from 6 - 9 on Halloween night.

It will only be in South Gate Park because Hollydale Park will be going under construction soon. Couple of other things on

594
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022

REPORTS AND COMMENTS

FROM CITY OFFICIALS
CONT'D Veterans Day by the fountain they will be having a ceremony and last is the Centeru'iial Day the city turns 100 on January 20'h and they will be celebrating on January 21s'
Arturo Cervantes, Director of Public Works acknowledged the street light outage that occurred on several streets, and he names those streets. He explains that the impact was from a failure of the streetlights system equipment and Edison did complete the repairs as of late last week. Since then, they have spent time troubleshooting the city streetlight system. As of today, the lights are functional, and they have back up lights if they do not work tonight. Explains that moving forward they can expect to have a more reliable lighting system.

Kris Ryan, Director of Administrative Services has nothing to report.

Chief Arakawa says that tonight they conducted presentations at the park on the fentanyl crisis and it went well. Also, tomorow they will also have another presentation at the St.

Helena's church, and they will be having another presentation at the park auditorium. He says that a DEA person will be there to explain what they are doing on a federal level. That is also the date they will be doing a prescription drug take back, the prescriptions will be taken and put into a box and disposed of properly. He explains that this week they will be having their Trunk or Treat event and it is a great opportunity for the cornrnunity to come out and feel safe. They will have a DJ and he invites everyone to come.

City Clerk Glaze explains that they had a successful candidate forum last Tuesday and thanks the Women's League for hosting the event. She explains that within the next two years they should work on translating because that is what was needed.

Also reminds the audience that November 8'h will be their Municipal Election and they will not be having the Regular Council meeting instead there will be a Special meeting on ' Thursday, November lO'h. In regard to Hollydale Community Center, there is a vote by mailbox, and she gives the location of

595
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022 RF.PORTS AND COMMENTS

FROM CITY OFFICIALS
CONT'D the box. There will still be a vote by mailbox, but it will be at a different location.

Mayor Rios asks if they will have any digital voting days before the election and where it will be at.

City Clerk Glaze says there will be digital voting and it is at the sports center.

Mr. Costley explains that in person voting will be at the sports center and begins in 11 days before election day.

Mayor Rios asks if they will have other locations or if that is the only one.

Mr. Costley explains that the ones he has mentioned are the only ones involved in the city property's but is unsure if there will be more.

Mayor Rios says they should be made available for the public and they could post them.

City Clerk Yodit Glaze explains that as soon as those locations are available, she can get those to the public.

Vice Mayor Avalos asks if they could make sure to post it to the city website because that is were everyone goes to check.

City Clerk Glaze says she will do that.

City Treasurer Martinez has nothing to report and tells everyone to be safe and to have a good Halloween and wishes all the candidate's good luck.

City Manager Jeffers would like to echo the subscription drop off event that the Chief referred to. He says it is a great program that LA County Sanitation District promotes. The reason is because a lot of expired or unused medication gets flushed which causes a problem for the sanitation of water and treating it. The other place is landfills and he talks about why this Pagel0ofl8 31
596
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022

REPORTS AND COMMENTS

FROM CITY OFFICIALS
CONT)D program is a great one and encourages everyone to take advantage of this program. He also gives a personal shout out to his better half in a few days they are going to be celebrating thirty-fifth anniversary and he continues thanking her because in this business they miss a lot of special events and thanks her.

City Attorney Salinas explains that his wife is the president of the Los Angeles Chamber of Commerce, and she is the first woman to hold that position. She was recognized by the LA Times as the most inspirational CEO in the non-profit world.

Council Member Hurtado would like to echo the topic with the streetlights. Explains that years ago they had a problem with the streetlights, and he invited the Congresswoman to pay him a visit and he explained the street light issues to them. As a result, she was able to bring in some funds and he provides a little bit of detail about the funds. He explains that since the lights have been fixed, he has not had any problems. He continues describing the problems with the streetlights and the conversations he has had with others. He asks the City Manager and City Attomey for some guidance on what steps they can take to fix this situation. He addresses some other issues and explains that the city needs to be more business friendly and talks about some of the delays that occurred when someone was trying to start a business. He states that it should not take long to get the process started for residents to remodel their homes.

Addresses the parking issues and some people on San Jose try to get the issues resolved when it comes to parking, but they are unable to because the process is taking long and explains that these issues need to be addressed. He also explains why they are unable to have a Trader Joe's in the city of South Gate and they have a business model that if a community does not have an average of 65 thousand and they look at the education levels of the community and they will not consider putting one in those communities. He explains his disagreement with this model and explains that he just wanted to answer the question.

Regarding the change in time for the public to speak from 5 minutes to 3 minutes he voted against it and now asks the other Council Members to consider changing it to 5 minutes and

597
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022 REPORTS AND COMMF.NTS

FROM CITY OFFICIALS
CONT'D supports their right to speak. He also agrees with Mr.

Dominguez to bring in cameras so that the residents have an opportunity to watch the meetings from home and hopes that they can look at options when it comes to that. He received complaints about the city apps to report graffiti and many have complained about delays and hopes that maybe they can look into that to see how it can be addressed. He went to the art walk and said it was a great event he also thanked Steve Costley for all the work and effort he puts into the events.

Council Member Diaz echoed the sentiments about the lights along with Council Member Hurtado and regards a
conversation a few years ago where the city was going to take over and there was going to be follow up meetings, but it kept getting rescheduled.

Mr. Cervantes explains that it was a meeting with Southem California Edison to discuss their ability to continue to service the city's street lights. They use transformers and the manufacturer since that last conversation they have gone out of business. They did purchase all of the transformers and they could have a conversation with them in terms of provider and where the responsibility lies. He explains they never got to those conversations, and they need to continue those conversations to see how those streetlights can be serviced.

Council Member Diaz continues by saying that she appreciates Mr. Pacheco with his complaints because they have so much finesse and he appreciates him begin so engaged. She echoes the same questions as Council Member Hurtado and for the past five years she has asked where the updates to the app are because the current app is outdated. She likes the one the Police Department has, and she thinks they should follow the one the Police Department has. Also, the status of the website is also out of date, she is unaware of the status of the updates.

Vice Mayor Avalos attended a few events the past few weeks.

One was the State of the College of Cerritos College, and she was the only Council Member representing South Gate and she

598
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022 RF.PORTS AND COMMENTS
FROM CITY OFFICI,kLS
CONT'D knows they represent a certain number of our students. One of the Members of the Board of Trustee stepped down and they replaced her with a resident from South Gate she commends her and says that South Gate is being represented on that board. She also attended the Azalea Bowl and concurs that Steve and his staff do an amazing job taking care of these events. She wishes everyone a happy Halloween and to be safe.

Mayor Rios attended the Art Walk and said that it was a fantastic event, and they highlighted a lot of local talent. He attended the Rotary Club, and they had the Assembly Member that gave a presentation on the CELA cultural museum, and they raised a lot of money and they talked about all the investments that are going on. Hopes they can also get a stop on the light rail, and he knows that the supervisor is working on that along with other elected officials. He also attended the Dos Rios Park, and he talks about how significant that park is. He also went to the Urban Orchard, and he explains that there has been a lot of investment. He also explains that they are working with the Chief to make sure that they are safe, they are have nonprofits, and park rangers patrolling. He continues by saying that they must commemorate the Sandy from the Kiwanians Club because they have done exceptional work serving the community and the youth. He attended the candidate fonxm and was disappointed because the League of Women has been known to do a lot of forums and there was a lot of Spanish speaking residents, and they did not get the opportunity to speak because there was no translation. He talks about the queuing system and explains that some people do not la'iow how to use technology and there is no one to help them. He explains that this needs to be addressed and they also must translate a lot of the things they put out because some residents don't speak English and they need to do a better job of translating stuff. He understands they are going to be hiring a communications person and maybe they should also oversee translating documents.

599
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022 CONSENT CALENDAR Agenda Items 7, 8, 9, 10, 11, 12, 13, 14 and 15 were approved by motion of Vice Mayor Avalos and seconded by Council Member Hurtado.

Council Member Davila was absent.

ROLL CALL: Council Member Diaz, yes; Council Member Hurtado, yes; Vice Mayor Avalos, yes; Mayor Rios, yes; Council Member Davila, absent
7 fflCIPAL CODE
ADMIN The City Council adopted Ordinance No. 2022-08-CC entitled - Ordinance of the City Council of the City of South Gate, California, adding Section

5.04.050 (Micro trenching), to Chapter 5.04 (Street Excavations and Obstructions), of Title 5 (Streets and Sidewalks), to the South Gate Municipal Code to incorporate the requirements of Section 65964.5 to the California Government Code, which require a local agency to allow micro trenching for the installation of underground fiber, during the Consent Calendar.

LICENSES & PERMITS The City Council approved items A & B during the Consent Calendar. a. Ordinance No. 2022-09-CC entitled - Ordinance of the City Council of the City of South Gate, California, granting a five-year franchise from September 13, 2021 through and including September 13, 2026 to Torrance Pipeline Company, LLC, to use, maintain, repair and replace a single pipeline beneath specified public streets, together with related appurtenances, for transmitting and distributing oil and oil products, within the City of South Gate; and
b. Appropriated $25,459 in additional franchise fees to the General Fund revenue estimates for FY 2022/23.

PERSONNEL ,=U)MIN The City Corincil approved items A, B & C during the Consent Calendar. a. Resolution No. 2022-64-CC entitled - Resolution of the City Council of the City of South Gate, California, amending and restating Resolution No. 2021-56-CC, approving updated salary tables and including an Essential Worker compensation for hourly employees; b. Appropriated $225,000 in American Rescue Plan Act (ARPA) funds for the purpose of providing Essential Worker compensation to hourly employees required to work during the COVID time period (March 18, 2020 to January 1, 2022); and
c. Authorized the Director of Administrative Services to make any budget appropriations needed to carry out these recommended actions.

600
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022 10 TRANSPORT ATION
SERVICES The City Council approved items A & B during the Consent Calendar. a. Resolution No. 2022-65-CC entitled - Resolution of the City Council of the City of South Gate, California, adopting the Transit Services Division 2022 Title VI Compliance Plan, effective July 31, 2022; and b. Directing staff to submit the 2022 Title VI Compliance Plan as required and implement the associated program.
11 PARKS The City Council approved items A & B during the Consent Calendar. a. Resolution No. 2022-66-CC - Resolution of the City Council of the City of South Gate, California, approving project application(s) for Specified Grant funds from the State of California Department of Parks and Recreation; and
b. Delegated authority to the Director of Parks & Recreation, or designee, to conduct all negotiations, sign and submit all documents including, but not limited to, applications, agreements, amendments, and payment requests which may be necessary for the completion of the grant scope(s).
12 DATA PROCESSING
SERVICES The City Council approved items A, B, C & D during the Consent Calendar.
a. Approved an agreement (Contract No. 2022-93-CC) with Civic Plus, LLC., to develop and host the City's Parks & Recreation software services; and
b. Appropriated $29,485 from the unallocated General Fund Balance to account 100-401-61-6101 to pay for additional costs for the new software; and
c. Authorized the Mayor to execute the Agreement in a form acceptable to the City Attorney; and
d. Authorized the Director of Parks & Recreation to execute any additional documents that may be required to implement the software program.

601
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022 13 LAW ENFORCEMENT The City Council approved items A, B, C & D during the Consent Calendar.
a. Authorized utilization of the 2022-2023 Selective Traffic Enforcement Program ("STEP") Grant Funds in the amount of $175,000 for overtime, equipment, and training expenses; and
b. Increased the Fiscal Year 2022/23 revenue projection in Account Number 236-556 (Law Enforcement Grants - OTS Grant) to $175,000; and
c. Amended the Fiscal Year 2022/23 Law Enforcement Grants Fund Budget by appropriating $175,000 as follows: $8,000 to Account Number 236-556-21-5110 (Overtime-Regular); $105,191 to Account No. 236-556-21-5111 (Overtime Sworn); $1,641 to Account Number 236-556-21-5220 (Medicare); $57,564 to Account Number 236-556- 21-6204 (Small Tools and Equipment) and $2,604 to Account No. 236-556-21-6340 (Training) for overtime, equipment, and training expenses; and
d. Authorized the Mayor to execute the STEP Grant Agreement (Contract No. 2022-94-CC) in a form acceptable to the City Attorney. 14 LAW ENFORCEMENT The City Council approved items A, B, C & D during the Consent Calendar.
a. Authorized utilization of 2020 Homeland Security Grant Program Funds in the amount of $14,185 for law enforcement training to address civil unrest, crowd control and active shooters; and b. Increased the Fiscal Year 2022/23 revenue projection in Account Number 232-541 (Law Enforcement Grants - Homeland Security Grant) to $14,185; and
c. Amended the Fiscal Year 2022/23 Law Enforcement Grants Fund Budget by appropriating $14,185 to Account Number 232-541-21- 6340 (Law Enforcement Grants-Homeland Security Grant - Training); and
d. Authorized the City Manager to execute the State Homeland Security Grant Program Subrecipient Agreement (Contract No. 2022-95-CC) for Grant Year 2020.

602
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022 15 MINUTES The City Council approved items A, B, C, D & E during the Consent Calendar.
a. The Regular Meeting minutes of June 27, 2022;
b. The Regular Meeting minutes of August 9, 2022; c. The Special and Regular Meeting minutes of August 23, 2022; d. The Special and Regular Meeting minutes of September 13, 2022; and e. The Special Meeting minutes of September 27, 2022.

DEVIATE FROM
THE AGENDA At this time, there being no objections, Mayor Rios stated that item 17 would be considered out of its regular agenda order. 17 WARRANTS The City Council approving the Warrant Register for October 25, 2022, by motion of Vice Mayor Avalos and seconded by Council Member Hurtado.

Total of Checks:

Less: Voids
Less: Employee Payroll Deductions
Grand Total:
$2,765,923.72
$ (0.00)
$ (380,598.07)
$2,385,325.68
ROLL CALL: Council Member Diaz, yes; Council Member Hurtado, yes; Vice Mayor Avalos, yes; Mayor Rios, yes; Corincil Member Davila, absent
16 SOLID WASTE MGMT The City Council received and filed a presentation from Universal Waste Systems on the transition of residential and commercial solid waste, recycling and organics recycling collection services scheduled to begin January 1, 2023.

Council Member Hurtado was recused from participating in this item as the FPPC has determined that it is a conflict of interest as Council Member Hurtado lives within 500 feet of Universal Waster Systems and left the meeting at 9:31 p.m.

603
REGULAR CITY COUNCIL MEETING MINUTES OF OCTOBER 25, 2022 ADJOURNMENT Mayor Rios adjourned the meeting in memory of the City of El Monte Police Chief Ben Lowry at 10:15 p.m. and seconded by Vice Mayor Avalos. Council Member Davila was absent.

PASSED and APPROVED this day of 2023.

ATTEST:

Maria del Pilar Avalos, Mayor Yodit Glaze, City Clerk

604

CITY OF SOUTH GATE

SPECIAL CITY COUNCIL MEETING

MINUTES
THURSDAY, NOVEMBER 10, 2022
CALL TO ORDER AlRios, Mayor called a Special City Council Meeting to order at 5:31 p.m.

ROLL CALL Yodit Glaze, City Clerk
PRF,SENT Mayor AI Rios, Vice Mayor Maria del Pilar Avalos, Council Member Maria Davila, and Council Member Gil Hurtado; City Manager Chris Jeffers, City Attorney Raul F. Salinas
ABSENT Council Member Denise Diaz
City Treasurer Gregory Martinez
CLOSED SESSION The Council Members recessed into Closed Session at 5:33 p.m. and reconvened at 6:30 p.m. with four (4) Members of Council present. City Attorney Salinas reported the following:

1. CONFERENCEWITHLEGALCO{JNSEL-PENDING

LITIGATION
Pursuant to Government Code Section 54956.9(a), 54954.9(b)(3)(C) a. Robert Mendoza v. City of South Gate, et al
b. Paul Gandara v. City of South Gate, et al.

On item 1(a), Mr. Mendoza claims he suffered injuries when he went over a meter box in the city sidewalk that caused him to trip and fall. Upon completion of the presentation by the City Attorney, a motion made by Council Member Davila and seconded by Vice Mayor Avalos and on a vote of 4-0, City Council authorized the City Attorney to defend the action.

On item 1(b), Mr. Gandara alleges that he was riding a bike and fell on a crack in the sidewalk that caused him to sustain injuries. The city previously denied that claim as had denied the Mendoza claim. After the presentation by the City Attorney a motion was made by Council Member Hurtado and seconded by Councilwoman Davila and the vote was 4-0, to authorize the City Attorney to defend that lawsuit. 40 605
SPECIAL CITY COUNCIL MEETING MINUTES OF NOVEMBER 10, 2022 ADJOURNMENT Vice Mayor Avalos adjourned the meeting at 6:39 p.m. and seconded Council Member Hurtado.

PASSED and APPROVED this day of 2023.

ATTEST:

Maria del Pilar Avalos, Mayor Yodit Glaze, City Clerk

606

CITY OF SOUTH GATE

SPECIAL CITY COUNCIL MEETING

MINUTES
THURSDAY, NOVEMBER 10, 2022
CALL TO ORDER Al Rios, Mayor called a Regular City Council Meeting to order at 6:33 p.m.

INVOCATION Steve Costley, Acting Director of Parks & Recreation

PLEDGE OF
ALLEGIANCE Evelyn Garcia, Police Lieutenant
ROLL CALL Yodit Glaze, City Clerk
PRESENT Mayor Al Rios, Vice Mayor Maria del Pilar Avalos, Council Member Maria Davila, and Council Member Gil Hurtado; City Manager Chris Jeffers, City Attorney Raul F. Salinas
ABSENT Council Member Denise Diaz
LATE City Treasurer Gregory Martinez arrived at the dais at 6:54 p.m. 1 PROCLAMATIONS The City Council will issue a Proclamation declaring November 10, 2022, as Law Enforcement Records and Support Personnel Day. 2 COMMUNITY DEV/
HOUSING The City Council received and filed a report on the progress of the Salvation Army Bell Shelter Pilot Program.
3 MUNICIPAL CODE ADMIN The City Council conducted a Public Hearing, waived the reading in full and introduced Ordinance No. 2022-10-CC entitled - Ordinance amending Title 9 (Buildings) of the South Gate Municipal Code by adopting by reference the 2022 California Code of Regulations, Title 24 ("2022 Building Standards Code") and the 2021 International Association of Plumbing and Mechanical Officials Codes, by motion of Council Member Davila and seconded by Council Member Hurtado.

ROLL CALL: Council Member Davila, yes; Council Member Hurtado, yes; Vice Mayor Avalos, yes; Mayor Rios, yes; Council Member Diaz, absent.

Meredith Elguira, Director of Community Development explains that the item before Council is for the adoption of the building code. They are bringing it to the Council a little bit earlier they wanted to make sure that when the state law goes into effect the city is ready to comply with the state law. She continues by explaining that there are significant changes 8 the permit fees, permitting fees, inspections, completion of resident 607
SPECIAL CITY COUNCIL MEETING MINUTES OF NOVEMBER 10, 2022 3 MUNICIPAL CODE ADMIN
CONT'D remolding, and board of appeals proceedings. These changes are significant enough to were they have to send some of the building and planner employees to training so that they will be kept abreast of the latest changes in the code. She explains that they have budgeted for that for the fiscal year 2022/2023. She explains that these new state mandates are effective January 1, 2023 and they propose amendments to the ordinances This concludes her report and is here to answer any questions.

Mayor Rios clarifies that this is for the building codes.

Ms. Elguira explains that it is and that this must be renewed every three years.

Vice Mayor Avalos would like to know what the cost of the training is and how many employees will be attending.

Ms. Elguira explains that it ranges from a few hundred dollars, and they have three inspectors and one building official. They have already sent two inspectors to training, it was all online.

Vice Mayor Avalos questioned why only two and not all three were sent to make sure that it is fair and equitable to all the inspectors because if one is out and the other one doesn't have the training it can be difficult.

Ms. Elguira explains that they are making sure they have someone in the field while the other inspector is getting trained.

Council Member Hurtado questioned the inclusionary percentage is 1 0% percent in terms of the inclusionary housing ordinance.

Ms. Elguira explains that it is 8%.

Council Member Hurtado asks that when someone is building a multiple unit building what is the percentage that must be inclusionary for low income.

City Manager clarifies that Council Member Hurtado is on item four.

Mayor Rios asked if anyone in the audience and zoom wished to speak on this item. Seeing no one step forward; Mayor Rios closed the audience portion.

608
SPECIAL CITY COUNCIL MEETING MINUTES OF NOVEMBER 10, 2022 MUNICIPAL CODE ADMIN The City Council conducted a Public Hearing and adopted Resolution No. 2022-67-CC entitled - Resolution of the City Council of the City of South Gate, California, establishing the inclusionary housing in lieu fee as provided under Chapter 11.29 (Inclusionary Housing), of Division II (Zoning Regulations), of Title 11 (Zoning), of the South Gate Municipal, by motion of Vice Mayor Avalos and seconded by Council Member Davila.

ROLL CALL: Council Member Davila, yes; Council Member Hurtado, yes; Vice Mayor Avalos, yes; Mayor Rios, yes; Council Member Diaz, absent.

Meredith Elguira, Director of Community Development explains that this is regarding an ordinance that was adopted back in June. It was explained last time that they are going to figure out a new in lieu fee and that is what is before Council a proposal for twenty-five dollars per gross square footage of residential space. This is in the lower spectrum of what other cities are charging, other cities are charging between ten to seventy-one dollars for rental unities and fourteen to fifty dollars for townhomes and single-family homes. Jim Simon has more information on this item so if they have any questions, they can ask him. Going back to the proposed in lieu fees is what is happening is that since June they required new developments to provide at least 8 percent allocates for affordable housing units. They also needed to provide an option for developers to then provide other ways to provide affordable housing units if they are unable to provide and an in lieu fee is one of those ways a developer can provide the city instead of actually providing a unit on the parcel. In order to provide them with at least some directions on the fee if they are not going to provide the units. Therefore, they came up with the twenty-five dollars based on what other cities are charging based on in lieu fees.

Mayor Rios asks if there is a reason that they are at the lower end.

Ms. Elguira explains that most of the higher end fees are mostly in cities where they will see developers that want or are eager to build housing units. Like Santa Monica or LA, they are not really getting a lot of developers knocking on the city's door to build housing developments at this point. They are talking with a few developers right now but because of the construction costs a lot of the developments and no penciling in. She provides an example of one developer who was looking at a site on Garfield and Imperial but they have tried hard to have housing pencil out but they are unable to do that.

Mayor Rios asked if anyone in the audience and zoom wished to speak on this item.

609
SPECIAL CITY COUNCIL MEETING MINUTES OF NOVEMBER 10, 2022 4 MUNICIPAL CODE ADMIN
CONT'D Liz Ruiz questioned why the fee is so low. Her concern is that having a lower fee is that it wouldn't incentivize developers and to include the housing on site. Which would be preferential to having it off site.

Having no one else come forward, Mayor Rios closed the audience portlOn.

Council Member Hurtado questioned the percentage of inclusionary housing. He asks why is it 6-8% because he doesn't remember agreeing to this and he remembers debating to have it to 15%.

City Manager Jeffers clarifies that they said 6-8% but it is to be brought back every year for a report and the Council can increase it at that point or not. The idea was like Ms. Elguira explained that they start off too high it will dissuade any housing from coming in and the idea was that they would come back, and the Council can say yay or nay based off the facts presented at that time.

Council Member Hurtado explains that he knows some cities that are at a much higher percentage like 50%. This was done deliberately to not have this included and there are a few areas that are looking for opportunities.

He knows that some properties on Tweedy are vacant and there are some properties on Paramount and Gardendale. He explains that if they have vacant lots, they must discuss ways to make those lots operational because having them there is not a good thing for anybody.

Ms. Elguira explains that they have the owner of Tweedy and Atlantic come in regarding a parcel they own in the city. They are getting developers into the city and trying to get what are the Councils preference in terms of the type of developments that they would like to see in the city.

She gives examples of some of the things that can be done with some of these parcels. They are encouraging developers that if they do build housing that it be affordable housing for sale that they want to see here in the city. The biggest hinderance is that the cost for a lot of the construction for these developments is very high. She hopes that they can provide incentives with CDBG funds and by promoting the Section 8 project voucher as opposed to a program voucher and she explains how this would incentivize developers to come into the city.

City Clerk Glaze asked Ms. Elguira if there is a way that she can give them an idea of what it is now for a 20 unit building as opposed to the $25 dollars per square foot.

Ms. Elguira explains that they currently do not have an amount. Right now, they are just proposing this.

610
SPECIAL CITY COUNCIL MEETING MINUTES OF NOVEMBER 10, 2022 CONSENT CALENDAR Agenda Items 5, 6, 7, 8, 9, 10, 11, and 12 were approved by motion of Council Member Davila and seconded by Vice Mayor Avalos. Council Member Diaz was absent. Corincil Member Hurtado recused from voting on Item 12. Item 13 was removed from the agenda.

ROLL CALL: Council Member Davila, yes; Council Member Hurtado, yes (recused for Item 12); Vice Mayor Avalos, yes; Mayor Rios, yes; Council Member Diaz, absent.
5 WATER/WASTEWATER
MGMT The City Council approved items A, B & C during the Consent Calendar. a. Amendment No. 2 to Contract No. 2020-09-CC with W. A. Rasic Construction Company, Inc., to extend the term and fund on-call services for one additional year and to fund emergency repairs that were performed on the sanitary sewer system, for a not-to-exceed amount of $150,000;
b. Appropriated $50,000 to Account No. 412-732-52-6101 (Professional Services Account) from the unassigned Sewer Fund to fund Amendment No. 2; and
c. Authorized the Mayor to execute Amendment No. 2 in a form acceptable to the City.
6 DATA PROCESSING
SERVICES The City Council approved items A & B during the Consent Calendar. a. Amendment No. 5 to Contract No. 2020-22-AC with ClientFirst Technology Consulting, retroactively effective October 1, 2021 through June 30, 2023, for continued project management services for the implementation of the Technology Master Plan in an amount not- to-exceed $62,580;
b. Authorized the Mayor to execute Amendment No. 5 in a form acceptable to the City Attorney.

LAW ENFORCEMENT The City Council approved items A, B & C during the Consent Calendar. a. Addendum No. 9 to Contract No. 3130 (Master Equity Lease Agreement) with Enterprise FM Trust to include the lease of a 2022 Chevrolet Silverado for the Police Department for a term of 60 months in the total amount of $52,859.60; and
b. Approved a Purchase Order Agreement with Black and White Emergency Vehicles for the purchase and installation of necessary

611
SPECIAL CITY COUNCIL MEETING MINUTES OF NOVEMBER 10, 2022 7 LAW ENFORCEMENT
CONT'D emergency equipment for this 2022 Chevrolet Silverado, in the amorint of $5,065.29; and
c. Authorized the Mayor to execute Addendum No. 9 in a form acceptable to the City Attorney.

WASTEWATER MGMT The City Council approved items A, B & C during the Consent Calendar. a. Agreement (Contract No. 2022-105-CC) with Southwest Pipelines and Trenchless Corporation for the construction of the Sewer Lining Project, City Project No. 629-SWR, in an amount not-to-exceed $89,950;
b. Authorized the Mayor to execute the Agreement in a form acceptable to the City Attorney; and
c. Approved the Notice of Exemption for the construction of the Project and directing the City Clerk to file it with the Los Angeles County Registrar Recorder's Office.

SOLID WASTE MGMT The City Council approved items A, B & C during the Consent Calendar. a. Agreement (Contract No. 2022-106-CC) with Tripepi Smith and Associates, Inc., to provide marketing, community outreach, and SB 1383 education services in an amount not-to-exceed $57,000; b. Appropriated $57,000 from the Refuse Fund Reserve to expenditure account413 304-12-6101; and
c. Authorized the Mayor to execute the Agreement in a form acceptable to the City Attorney.
10 PURCHASING SERVICES The City Council approved items A, B & C during the Consent Calendar. a. Purchase Order Agreement with Norm Reeves Ford for the purchase of two Ford Explorer Interceptor Edition vehicles for the Parks & Recreation Department in the total amount of $102,192.56, and b. Appropriated $2,192.56 from the unassigned General Fund Reserve to account #523-460- 61-9003 (Grounds Maintenance) to complete the purchase; and
c. Authorized the Purchasing Division to complete the purchase according to City regulation.

612
SPECIAL CITY COUNCIL MEETING MINUTES OF NOVEMBER 10, 2022 DEEDS & EASEMENTS The City Council approved items A & B during the Consent Calendar. a. Grant Deed from Alameda Tweedy, LLC., to secure right-of-way for street purposes as part of the development located at 2505 Tweedy Boulevard, at no cost to the City; and
b. Authorized the Mayor to execute the Certificate of Acceptance in a form acceptable to the City Attorney.
12 WATER The City Council approved items A & B during the Consent Calendar. a. Accepted completion of construction of the Water Facility Chlorination System Upgrades, City Project No. 586-WTR, completed by Pacific Hydrotech Corporation, effective October 31, 2022; and b. Directed the City Clerk to file the Notice of Completion with the Los Angeles County Registrar Recorder's Office.
13 This Item was removed from the agenda.
14 PERSONNEL ADMIN The City Council approved items A & B by motion of Council Member Davila and seconded by Council Member Hurtado.
a. ResolutionNo.2022-10-CCentitled-ResolutionoftheCityCouncil of the City of South Gate modifying the thresholds for the Recruitment Bonus Program and the Referral Bonus Program; and b. Authorized the City Manager to execute documents necessary to effectuate the actions, including employee agreements and any amendments thereto, as approved by the City Attorney.

ROLL CALL: Council Member Davila, yes; Council Member Hurtado, yes; Vice Mayor Avalos, yes; Mayor Rios, yes; Council Member Diaz, absent
15 DATA PROCESSING
SERVICES The City Council approved items A & B by motion of Vice Mayor Avalos and seconded by Council Member Davila.
a. MemorandumofUnderstanding(ContractNo.2022-107-CC)between the County of Los Angeles and the City of South Gate to collaborate and coordinate relating to community-based connectivity projects; and b. Authorized the City Manager to sign the MOU on behalf of the City of South Gate in a form acceptable to the City Attorney.

613
SPECIAL CITY COUNCIL MEETING MINUTES OF NOVEMBER 10, 2022 15 DATA PROCESSmG
SERVICES CONT'D ROLL CALL: Council Member Davila, yes; Council Member Hurtado, yes; Vice Mayor Avalos, yes; Mayor Rios, yes; Corincil Member Diaz, absent
16 CITY COUNCIL The City Council approved the rescheduling of the November 22, 2022, regularly scheduled City Council meeting to Tuesday, November 29, 2022.
17 WARRANTS The City Council approved the Warrant Register for November 10, 2022, by motion of Vice Mayor Avalos and seconded by Council Member Hurtado.

Total of Checks:

Less: Voids
Less: Employee Payroll Deductions
Grand Total:

Cancellations: 98850, 98902, and 98474
$2,637,454.75
$ 0.00
$ (350,298.49)
$2,287,156.26
ROLL CALL: Council Member Davila, yes; Council Member Hurtado, yes; Vice Mayor Avalos, yes; Mayor Rios, yes; Council Member Diaz, absent
ADJOURNMENT Mayor Rios adjourned the meeting in memory of the Anna Gonzalez Enriques and Ramon Perez, family members of Vice Mayor Avalos 8:47 p.m. and seconded by Vice Mayor Avalos. Council Member Davila was absent.

PASSED and APPROVED this day of 2023.

ATTEST:

Maria del Pilar Avalos, Mayor Yodit Glaze, City Clerk

614

CITY OF SOUTH GATE

SPECIAL CITY COUNCIL MEETING

MINUTES
TUESDAY, NOVEMBER 29, 2022
CALL TO ORDER Al Rios, Mayor.called a Special City Council Meeting to order at 5:32 p.m.

ROLL CALL Yodit Glaze, City Clerk
PRESENT Mayor Al Rios, Vice Mayor Maria del Pilar Avalos, and Council Member Gil Hurtado; City Manager Chris Jeffers, City Attorney Raul F. Salinas ABSENT Council Member Maria Davila, and City Treasurer Gregory Martinez LATE Council Member Denise Diaz arrived during closed session at 6:26 p.m.

CLOSED SESSION The Council Members recessed into Closed Session at 5:34 p.m. and reconvened at 6:31 p.m. with four (4) Members of Council present. City Attorney Salinas reported the following:

1. CONFERENCEWITHLEGALCOUNSEL-PENDING

LITIGATION
Pursuant to Government Code Section 54956.9(a), 54954.9(b)(3)(C) a. Ruiz, et al. v. City of South Gate, et al.
b. NR Development Inc., v. City of South Gate
c. Stephanie Ann Elledge v. City of South Gate
Item 1(c) is a tort claim that the city considered in closed session. After presentation of that tort claim, there was a motion made by Council Member Hurtado and seconded by Vice Mayor Avalos and on a vote of 3- 0 to deny the claim. Shortly after the vote, Councilwoman Diaz joined the meeting.

Item 1(b) was not discussed in closed session. This will be continued as an agendized item to the next regular city council meeting.

Item l(a) was not discussed, and Council will be adjourning back into closed session following the regular council meeting to address the case.

RECESS At this time, 6:34 p.m., Mayor Rios stated that the closed session meeting be recessed in order that the Council might hold its Regular City Council meeting.
49 615
SPECIAL CITY COUNCIL MEETING MINUTES OF NOVEMBER 29, 2022 CLOSED SESSION The closed session meeting recessed at 9:58 p.m. and reconvened at 10:30 p.m. with four (4) Council present. City Attorney Salinas reported the following:

Council met in closed session to discussed item 1(a). This is a federal court case involving a claim of excessive force by the South Gate Police Department. The City of South Gate defended that action and entered into a mediation to try to resolve the matter. The matter did resolve, and a proposed settlement was received. The City Council approved this evening subject to the approval by the City's insurance are cooperative (ICRMA).

The amount of the settlement is not being disclosed at this time because is subject to approval by others and there is no formal agreement that has yet been entered. The motion approving the settlement was made by Council Member Hurtado and seconded by Vice Mayor Avalos and the vote was 4-

0. Mayor Rios asked if anyone in the audience and zoom wished to speak on this item.

Mario Dominguez inquired if Chief Arakawa could comment on this item.

Mayor Rios stated that Chief Arakawa is no longer in the Chambers.

City Attorney Salinas stated that it was a use of force case brought by the Estate of Ruiz. It was an officer involved shooting. The City defended the action and continue to defend the action vigorously and the matter is being settled with the cooperation of the city's insurance company (ICRMA).

ADJOURNMENT Vice Mayor Avalos adjourned the meeting at 10:32 p.m. and seconded Council Member Hurtado.

PASSED and APPROVED this day of 2023.

ATTEST:

Maria del Pilar Avalos, Mayor Yodit Glaze, City Clerk

616

CITYMANAGER'S OFFICE
Item No. 16
JAN 17 :,a23 City of South Gate
t4i-.0fJr' CITY COUNCIL
AGENDA IBaILL
For the Regular Meeting of: January 24, 2023
Originating Department: City Manager's Office
SUBJECT: CITY COUNCIL DISCUSSION OF HONORING MS. VIRGINIA

JOHNSON AS REQUESTED BY VICE MAYOR HURTADO AND COTJNCIL MEMBER DAVILA
PURPOSE: To have a discussion of honoring Ms. Virgina Johnson for her civic engagement of over 20-years in the City of South Gate. Ms. Johnson passed away on January 15, 2023.

RECOMMENDED ACTION: The City Council will consider whether the City should provide a special recognition in honoring Ms. Virginia Johnson for her 20-years of civic engagement of through her attendance at City Council meetings and public comment participation during those meetings.

FISCAL IMPACT: None.

ANALYSIS: Vice Mayor Gil Hurtado and Council Member Maria Davila have requested that the City Council discuss and provide any direction to staff as to honoring Ms. Virgina Johnson for her two decades of civic engagement. Her engagement began with the speaking out during the public corniption that occurred in 2003 by the then City Council and City Treasurer. Her participation continued even as that dark chapter in the history of the City of South Gate passed up until the end of 2022. Vice Mayor Hurtado and Council Member Davila believe her participation over those years was a model for residents citywide in civic participation. She gave constnictive comments on many items that appeared over the years on City Council agendas.

Ms. Johnson was a nearly 50-year resident of the City of South Gate and was approximately 71 years old at the time of her passing.

ATTACHMENT: SouthGatePatchArticle(May31,2012)
1 617
1/17/23, 912 AM Virginia Johnson: South Gate's "Watchdog" i South Gate, CA Patch

ADVERTISEMENT
2/9
618
jll7/23, 9:12 AM Virginia Johnson: South Gate's 'Watchdog' l South Gate, CA Patch

ADVERTISEMENT
Virginia Johnson, 64, is probably one of the easiest people to spot at almost every South Gate City Council meeting. Sheisalwaysinfrontlisteningattentivelytoeverythingytakingnotesandgettingreadytospeak her mind. Johnson is not a journalist or politician. She is not paid to attend the meetings or does so out of a desire for fame. Johnson is something of a rare breed: a concerned citizenwith consistency. "We have some reany good people [in city government],') said Johnson, as she drankcoffee on aThursday afternoon at EI Paseo. "But that doesn't mean I am always going to agree with them." Find out what's happening in South Gate-Lynwoodwith free, real-time updates from Patch.

Your email address Let's go!
ADVERTiSEMENT
319
619
1/-17/23, 9:"12AM Virginia Johnson: South Gate's "Watchdog" I South Gate, CA Patch Johnson admits to not necessarilyhaving the most popular opinions. However, her informed comments during the meetings have garnered her much respect amongst the members of the South Gate City Council. "Virginia doesn't just take a position in terms of complaining, but offers solutions,)) Vice-Mayor Gil Hurtado. "That is the kind of thing people need to do if theyfeel that changes need to be made.')

ADVERTISEMENT
Councilmember Henry Gonzalez concurs with Hurtado. Highlighting that he will always take into account her comments, because of her serious involvement. "Virginia is one of the better watchdogs of the community,)) said Gonzalez. "That is the kind of people I listen to. ))

ADVERTISEMENT
4/9
A
620
1/17/23, 9:12AM Virginia Johnson: South Gate's "Watchdog" l South Gate, CA Patch

ADVERTISEMENT
Moreover, Johnson's informed approach is something that, South Gate's city manager, believes to be of great importance to the city.
"She likes holding staff and elected officials accountable," said Troxcil. "We wish more citizens would be more engaged Iike her.')
Johnson, who works as a caregiver for her adult son because of a brain injuryhe sustainedwhile as a child, was not always as politicany active as she currently is.

In fact, itwas the corruption scandal thatwas caused by the nowjailed former city Treasurer, Albert Robles, alongwith his ousted City Council allies, that led her to start attending the meetings in the early 2000S.
"I got really involved during the recaIl,') said Johnson, who first started attending City Council meetings shortly after the South Gate Rod & Gun Club, a local fishing and shooting non-profit, was pushed out of the land that they operated from by the then City Council. "The meetings were Iike a soap opera.)) At the time, Johnsonwas one of the hundreds of involved residents who never missed a meeting, and kept

ADVERTISEMENT
01 621
1/17/23, 9:12 AM Virginia Johnson: South Gate's "Watchdog" I South Gate, CA Patch in 2003, along with the other elected officials associated to him, most people stopped attending the MEETINGS.

Unlike the majority, Johnson has continued to attend almost every City Council with few exceptions, in order to ensure that history does not repeat itself.

ADVERTISEMENT
"How did we get bad people? Because people did not go to the meetings,') warns Johnson.

Keep up with South Gate Patch Latino by subscribingto breaking news alerts, likingus on Facebookand following us on . Have an event or announcement you'd like to publicize? Submit them for free.

Getmore local news delivered straight to yourinbox. Sign up forfreePatch newsletters and alerts (O Thank D Reply G> Share
Around The Web 0
CalifomiaWill Cover Cost
to Install Solarin These
California Seniors with No
Life Insurance Get a 5z5ok
IfYou Have Any of These
25 Toys LayingAround,

ADVERTISEMENT
6/9
O)
622
@ffVMANAamaisappiat Item No. 17
ybN "} 7 2!J.!3
i{'.6D kr'
City of South Gate

CITY COUNCIL
AGENDA IBJ[LL
For the Regular Meeting of: January 24, 2023
Originating Department: Administrative Services
SUBJECT: REVIEW AND ACCEPT FISCAL YEAR 2021-22 AUDITED ANNUAL

COMPREHENSIVE FINANCIAL REPORT AND PRESENTATION
PURPOSE: TopresenttotheCityCouncilareviewoftheCityofSouthGateFiscalYearended June 30, 2022, annual audit, and the Annual Comprehensive Financial Report ("ACFR").

RECOMMENDED ACTION: This is a receive and file item. No formal council action is required.

FISCAL IMPACT: None.

ANALYSIS: The ACFR of the City of South Gate for the Fiscal Year ended June 30, 2022, is hereby presented as mandated by both local ordinances and state statutes. These ordinances and statutes require that the City of South Gate issue annually a report on its financial position and activities, and that an independent firm of certified public accountants audit tbis report.

The annual audit for the Fiscal Year ended June 30, 2022, was conducted by the independent accounting firm of Davis Farr, LLP ("the auditors"). The goal of the independent audit is to provide reasonable assurance that the financial statements of the City for the Fiscal Year ended June 30, 2022, are free of material misstatements. The audit was conducted in accordance with the accounting principles generally accepted in the United States. The auditors found that the City's financial statements present fairly, in all material respects, the financial positions of the City governtnental and business-type activities; essentially a clean audit opinion.

The auditor's presentation will outline their audit goals and strategy as well as their findings and recommendations.

BACKGROUND: The ACFR is a set of financial statements for a state, county, municipality, or other governrnental entity that comply with the accounting requirements established by the Governmental Accounting Standards Board ("GASB"). It must be audited by'an independent auditor using generally accepted government standards. The ACFR consists of three sections:

Introductory, Financial and Statistical. The Introductory section orients and guides the reader through the report. The Financial section presents the entity's, basic financial statements as well as notes to the statements and the independent auditor's report. The Statistical section provides l
623
additional financial and statistical data, including data about financial trends that may better inform the reader about the government's activities.

How is ACFR different from the budget? The budget usually is a less comprehensive presentation of the financial statements of the governtnent and describe actions that will take place in the fuhire (for example, purchase of vehicles or construction of streets). The budget is also a flexible document in that it will be amended during the fiscal year as needs or decisions arise.

The ACFR, by contract, presents a wider variety of important information intended to help the reader properly understand the basic statements. The ACFR contains the actual results of the prior year's financial activities.

GASB sets the standards governing the content of ACFR. GASB is an arm of the Financial Accounting Foundation, which also administers the Financial Accounting Standards Board that established accounting standards for private or publicly traded companies.

For the general reader, you can find the "high points" by reading through the Management Discussion and Analysis ("MF&A") in the financial section. The MD&A describes the previous year's results and the key factors influencing them, shows the City's financial condition, and provides an overview of the likely future prospects.

ATTACHMENTS: A. Auditor's PowerPoint Presentation
B. Fiscal Year 2021-22 Annual Comprehensive Financial Report 2 624
{F.. CERT
VIS arr
ATTA
' 0 ,01
625
Audit ReporLs Issued
o Reports Issued:
2 Annual Comprehensive
Financial Report
[2 State Controller's Report
[3 Appropriations Limit Agreed-
Upon Procedures
2 Audit Communication Letter
[2 Internal Control Letter
Q Single Audit Report (in
process)
30, 2022
-k-
DavisFarr
626
Management and Auditor's
Res onsibilities
m
Np!slba>usmJiZieb uf ffl4myayemeul rur the Financial S{alcxhhcihl:s The City's 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 JesiB. imolempntation. 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 AuditOr'f Rfi € p(kr@ €:ibilitk'N- far tbe Audit Of fhe FinanCial SZiZemtuLa Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes ouc opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conduded in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting: a material rnisstatement 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, MisbLoLeiiienLb oi'e 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.
@ Da
627
Audit Opinion
[] Unmodified Opinion dated December 12, 2022:

QThe financial statements and footnotes are presented fairly, in all material respects, in accordance with generally accepted accounting principles
o Emphasis of a Matter Paragraph:
21mplementation of Government Accounting Standards
Board (GASB) Statement No. 87: Leases
2 Prior period adjustments (described in note 17)
4> DavisFarr
628
m
Financial Results
€ ax* ad aa* u'a ;6aisaz' j
+ € 1 ! K la au
yaa'rbl iie w sse z _"Thiimm I
%IIJI nu5Jue5!-JlJpe
ActAfjes Actos Total l
?- 2a?J 20')-') 2021 2022 2021 I
Cmentzdotherassets S 12433955'k $ 144,!m,902 S 53,103,@9 S 30,793,468 S !77,442,660 S l"i5,€74370 CmThie8 g.o_gv_iys _')40_4977_44 40J4S_17S SO4751_')_47 '?ROR4t40l N1:117<741 l
I
_, - - - - - - - 7 - - 7 - - - - - !I - - - $ -0- - -- 7 # # j # - # # +i # % # y # # add j ffl J iy ad d a j a il d % I j * i Tsdd m.sett 36A_1:lR_Ji8@ Afi5j'7flJ@6 lai €Mfl }'[A Rl 5'ffll 'jN4 46.7 '}R"! IA_K ,166 tie Ill ! , , % . - .. - - _- , - - , - - + + #, # + , + % + + + , + -* + ,# # # + + p. a a , a &k f ffi l ybu ffi y& ww ffiffi f if j? $6 6 & DeOmaom 23,738,-a 20,447,990 2327,815 2,!4E,488 26,066,283 22,689,468 !
i
1115ffil Th - R - - - J 4%-4 - 1$ III!II e J ja II & d J R Aa All "l i -%ffl a I ! % i AN j 8a % jP 71 j- j4 6 € 4 4 /ah a j a I kOXee €l!J Lh,j3Th 10,44-j,Vau LlLi,015 L,441,465 !O,fee,a! !!,@8V,'44@8 I [zintr-temadebtoutstdmp 10'l_0_651 N4S_5_1R3 33_')41_l4g 37_467 ?41_')J77@O Iga' %7A_6 I ' a 'aaa a ' a a a a o1'o ' a ! a ' a a -a 5 a a ' ! ##+ aa a o>o -o a a oa I o o a ' o o a a I o a ' " " !" '5"'a ' J'liiJ--1::- - - '% A * :r Jr % f I * 'I j'l "kl! I '!i A 'Jth 7311 J '% * llil J% .a&%l) 4 $ J% la9 lj .P 1 IFA- }
}
tWuaUK)aeS -"t,?)J,10) 13,/%'j3 fl,13,4/!c !1,Ul,'.19J 34'%:'IJJR3' "/)4,)!!? i Tadalffliabi1jmes 132J11J16 159jA7jll A1_361_616 46;81_6ffi8 N'JJ_'72@_AA2 1a6_12@_16@ i- - - - - - - - - -r- - - y - - - - - - >- - - - - - - - - >-- - - - ? o o>- - o a - o j a oa Y o a o o j' aa ja o a i Tkbiflnw-, 4g_6@_4@')_ 9_1118J90 2__70i 6S6_(J')_7 Sl_S6S_l@1 0_'nS_{Mjn I
I
i- - - - - -? - ) - - - - :I- - -r - - 'l - - ? - - - '-- - ! - - ' - ffi+ - - ?- - - 5 a - - ! - - o } '1@1 -!--)f !
jJffl jaPlWTMlffllWffi% m t
ces 48J4@,4@2 !,118780 22%,'Nb% 656fi2l 5ffi,193 *,l't5, €Hh'J I Netpesbc
esredmnetcspmseb 239,10},781 :!39,643,790 q81l,74) 20,71NJ25 26],9)3,52) 260355,6X5 Resmcted 49,311,796 6},9'!E,090 846,,419 49,3)1,7% 6.,'.77430€) I % lA.s% tel _4A7 'h 'h'f_ /A_I '!1 I (bn !e 2nl n!l'% I A '? 11 '7 1'?!l 141 I AA € AAI /An 4 € kA j41 % !
t
Ij Q 1,l?aal 1101% It r'@ I %ll:l} IO% ! ,J-J 11?T,4J1 A.,J ) J4J,Jlffl4V" jlffl, J L l,- I I %)y&,} I"y 'T-P% !-Jl ) !! '@41 - -A -;! - l! 4 &je h Jl t A J A e 'l -l all * :il M : # ffl if -% M i% 41 'l je i JQ r e i a a $ d 6 &'JI a 119 6 ffl # 9 t i f jlffi 4 r Efffll WfTp?ln(m § !fg,!P40?V47 :) !87,a)#V%X10 ?l W%ll!,I-/Oj! e .flil.-10,?la 3 !66 Via all $ !-/J,0&?,441,A ! - /
I
629
a
Financial Results: Revenue
'G:* a%7a Thx&aa
J t RXR j_ljl!X ll%lllll- - - -"'0 - - - - - - - l'-aaanwaasita1 semzire_izi
- - - -- - - J r-
A7 k Total
: :2a2Ji 2a.! 2021 2022 2021
N
Thiivaaihiiiiiiia61ll!II}J!l! a
r.ict euucx -
Omysfutrs S %437,224 S 9,749,€7! S 25,184,IU S :!4?4,165 S 33,6.1,4a9 S 34,644,036 '*rffia yiiiaiili i. * -i :t:t '777 '7a!'! '!Hit 4Q iK:l 127 IJThi 1:1 nAa. J 2 J'n.4 020 '10 aao * IJ - JL - - Q &,I - - - - - - - - - - - - - - - - - - - - 5 - - - } - - - J - - - 5 - - - # - 7 € # # # 6' + # d d (6 qM% q W k, ffi * %l f'i-iiffixl a' j?z yaaii ? I'? !O I _4 li 4A /$fl'4 lill jlab 1.4 II JI A /IIAJ% z* I XI I ffi!2t@ ?':l'JP!I j'a fir & I N IN ff m @ l@R ffljffi % l;lJ__Ja I_ 141 __4_'ffiffl €_5' - - II l @ 'LX l @a f .Fa ' k k4- -4- - - - - 1 - -' = - - - - - a - - "- - - " ' - - - -' ' " -"- - . --1 # - . I l a y ffi * ffljffi' ;i' y%#la' Gmigsdmes:
yaa 15,4tg214 1 15,46:!,!14 15,
Sdsmes 27JS89,344 25,106.!47 27,689,m 25,106,!47
Odagtsmes 5,73q6O3 S,48Q;779 5,730,6aB 5,4S2,7??
tm_. .. J _ _ _. % :_ _) . .. _.._ /'I '4iA! AL4fl!1. W A!!I Jl /l W J I !j% jet n .tl j'$ ' j"? I laPll% jM !m %-P% @ @W"Yl @ 1fflN H 3 @fflP l" aa"!J_l _:_EJ_'fflh4 € L_j:_'4_.ljj j DLI!'+ I J_' l_l 7$ @ ..!X / ' - - - - -' - - - - 5 ' - 'l "' '?"" - 'i'T' 5'a '/ o a %o To o a l'a' o a/ " I" ' ,, .aw N:(I 4al .'l !'Ml @jn. fija O a'bl .a iMJl 41 n l'ffl!!tl JN J-jKl_Xl - - 2&-j_?ffl € _r@@@ a' a a - " "'a - a a oo a " a -t n %ja4ffi Thb#r l00_a#_Al'7 NO@_'7MJ'7i 231_0€)l_nffh3 M_@dA_'!M 17_A MN%GW 1:L46%*?Y - -' - - - - - --"-?"' r- - - - - ---"l- --r - - - -- - -f - - r-- - -r- -l 'a - - - - -"'9'!" !"-'-"l" "Y " ' 630
Financial Results: Expenses
J%ds ,h in i'simjixs
:R)efhse
Tmd rils*'!;
Sd( *Nd!'
2021
757!1,44]
!9,n8B$iS
!i,71-1974
3=t486, €71
il374p.
6!9-620
7J4L438
351a.7M
13-7u4D6
:a810
81J15J,186 87J41p
15-070342
4324,a
11-146:225
1,!23,295
14J)01,403
4,16,82)
)!787ffifl8
7574443
QQ75
t7?QP?4
4 IQ
649A20
175Rp
asp's;4
4Qa

3.filu
Q . : Q S5fl)736 :,179
(2L9S4316)
@,9a,06:>) 2Q3'i;244
+ Da
631
General Fund: Revenues
City of South Gate
Required Supplementary Information
Budgetary Comparison Schedule - General Fund
For the Year Ended June 30, 2022
REVENUES:

Taxes
Licenses and permits
Intergovernmental
Charges for services
LJse of money and property (loss)
Fines and forfeitures
Rental
Miscellaneous
Total revenues
Budgeted Amounts
Original Final
$ 44,729,073
1 ,757,049
85,500
2 ,424,700
856,636
1 ,170,587
2 64,366
4,796,090
56,084,001
$ 44,729,073
1 ,757 ,049
85,500
2 ,424,700
856,636
1 ,170,587
2 641366
4,196,090
56,084,001
Adual
Amounts
Variance with
Final Budget
$ 48,770,618 $
1 ,623,236
216,631
2,342,111
(783,785)
1,310,097
129,788
4,120,074
57 ,728,770
4,04i,545
(133,813)
131,131
(82,589)
(1,640,421)
139,510
(134,578)
(676,016)
1,644,769
632
General Fund: Expenditures
EXPENDITURES:

Current:

General government
City Council
City Clerk
City Treasurer
City Attorney
City Manager
Administrative Services
Total general government
Police
Community development
Parks & recreation
Public works
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures

REVENUES OVER
(UNDER) EXPENDITURES
Budgeted Amounts
Original Final
359,191
598,330
37,557
1,208,032
1,235,427
3,586,334
7,024,871
30,770,083
3,371,026
9,916,510
4,943,773
1,395,000
622,039
58,043,302
(1,959,301)
359il91
598,330
37,557
1,208,032
1,235,427
3,591,459
7,029,996
30,786,285
3,727,344
9,926,510
5,354,771
1,395,000
622,039
58,841,945
(2,757 t944)
Actual
Amounts
321,283
543,289
36,646
1,910,212
955,798
3,375,241
7,142,469
30,040,630
3,293,625
8,676,195
4,343,329
64,008
1,411,339
624,408
55,596,003
2,132,767
Variance with
Final Budqet
37,908
55,041
gii
(702,180)
279i629
216,228
(112,473)
7451655
433,719
1,250,315
i,011,442
(64,008)
(16,339)
(2,369)
3,245,942
4,890,711

OTHER FINANCING (USES)
Transfers in
Transfers out
Total other financinq (uses)
(4,728,750)
(4,728,750)
(4,737,250)
(4,737,250)
8,787 ,075
(31,880,830)
(23,093,755)
8,787,075
(27,143,580)
(18,356,505)
(20,960,988) I (13,465,794)1Net change in fund balance $ (6,688,051) $ (7,495,194) 633
m
Pension Obligations
(9) Retirement Plans
The following is the summary of net perision liability and related deferred outflows of resources and deferred inflows of resources at June 30, 2022 and pension expense for the year then ended.

Net pension liability
CaPERS CalPERS
Miscellaneous Safety
$20,670,896 $40,036,851
PARS Total
$ 175,297 $60,883,044
Contributions $5,234,731 $6,175,454 $ 93,404
Funded Percentage 88.75o/o 76.47o/o 88.40o/o
634
Other Post Employment Benefits
E. Change /n the TOta/ OPEB Liabilitf
Increase (Decrease)
Tota € OPEB Pbn Fducffiry Net Net OPEB
LjabURy Posatn ljabNky/(Asset)
(a) (b) (C) = (a) - (b)
Bamnce at June 30, 2021 % 281979,784 $ - $ 28,979,784 Changes Recognized for the Measuzrnent Period:

ServceCost 1,342,086 1,.342t086
Tnterestontietota$OPEBha5iUy 731,487 7311487
Changesdbenefitterms - -
DHegence txtween expected and actual expem (3,057,982) (3,.057,982) Changesofassurnptjons 3,139,649 - 3,139,649
Contrbutjomfromtheemployer (714,003) (714,003)
Contn?iutmmfmrnernployees - -
Benefit paymnts, iricluding refunds of empkiyee - contgjbutmnsandirnplt&subsidy (2161,510) (216,510)
Net Changes durjng July 1, 2019 to l'une 30, 2020 1,938,1730 (714,003) ___ ___ 1,224,727 2bnce at June 30, 2020 (Mea4ai7g'erneri€"[)ate)1 $ 301918,514 $ (-714,003)- l'y"-""-""""""' :qo,zozif"'iii 'l 635
m
Required Auditor Communications
+ DavislFarr
636
Internal Control Approach
m
Q Auditors obtain an understanding of internal
controls for the purposes of planning the audi
to express an opinion on the internal controls
o We reviewed the City's policies and procedure
interviewed City staff, and performed test of
controls For the following control areas:

Q Cash receipting
QCash disbursements and purchasing
2 Payroll
[]lnvesting
[]lnformation systems
Q Grant management
@ Da
637
m
nternal Control Recommendations
[] Audit adjustments and prior period restatements [2 Fund deficits resulting from accounting for
pension and post-employment benefit obligations,
and other reasons
o Certain fund expenditures exceeding budgeted
appropriations
o Accounting for Successor Agency capital assets
and land
41 [)avisl(arr
638
ues ion
Jennifer Farr, CPA I Partner
Davis Farr LLP 18201 Von Karman Ave, Suite 1100 Irvine, CA 92612 Phone: 949.474.2020 Email:[email protected]
639
, age) tpno5-, 4o%)
I,.

JUlOd3N TVI:)?I'VNI=I
3/\lSN3H3NdWOC) TVnNNV
640

CITY OF SOUTH GATE

ANNUAL FINANCIAL COMPREHENSIVE REPORT
Year ended June 30, 2022
Prepared by:

Administrative Services Department
19 641

CITY OF SOUTH GATE
Annual Comprehensive Financial Report
For the Year Ended June 30, 2022

INTRODUCTORY SECTION
Table of Contents
Page
Table of Contents ... ...... ......................... ...... .............. ...... .. .... .... .. .... ...... ... . ... ...... ..i Letter of Transmittal. ... ... ... .. ...... ........ .. .. ......... .. . ....... . ............ ........... ... ....... . .....iv Directory of Officials.. .... . . ...... ...... .. .... ..... ............ ......... . .. ...... ............... .. ....... . . ..vii Organization Chart........................................................-...........-----------.-------------------------------!X GFOA Certificate of Achievement for Excellence in Financial Reporting ...... .................... ......... ... x

FINANCIAL SECTION
Independent Auditors' Report on the Financial Statements.....

Management's Discussion and Analysis (Required Supplementary Information) Basic Financial Statements:

Government-Wide Financial Statements:

Statement of Net Position
Statement of Activities
Fund Financial Statements:

Governmental Fund Financial Statements:

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

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

Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the
Government-Wide Statement of Activities
Proprietary Fund Financial Statements:

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

Statement of Cash Flows
Fiduciary Fund Financial Statements:

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

Notes to the Basic Financial Statements.,
Required Supplementary Information:

Budgetary Comparison Schedules:

General Fund
Grants Special Revenue Fund...

American Rescue Plan Act Fund..

Notes to the Budgetary Comparison Schedules
27 30
.gs
. gg
100
101
20 642

CITY OF SOUTH GATE
Annual Comprehensive Financial Report
For the Year Ended June 30, 2022
FINANCIAL SECTION (Continued)
Table of Contents
Page
Required Supplementary Information (Continued):

Schedule of Changes in Net Pension Liability and Related Ratios:

CalPERS Miscellaneous Plan.............

PARS - Supplemental Retirement Plan
Schedule of Proportionate Share of the Net Pension Liability and Related Ratios:

CalPERS Safety Plan.

Schedule of Contributions:
102
104
106
118
CalPERS Miscellaneous Plan.... ........ .. . .. ..... ....... ..... ..... ............... ...... ... . . .. .... 108 CalPERS Safety Plan.. ........ . ..... .. .... . ... . ........ ...... .......................... ... ........ .. 110 PARS - Supplemental Retirement Plan. .. . ... . .. .. ... ... .. ...... ............ .. .......... . .. .. 112 Schedule of Changes in Net Other Postemployment Benefits Liability and Related Ratios........ 114 Schedule of Contributions - Other Postemployment Benefits Plan . .... .... ...... .... . ...... .... 115 Supplementary Information :

Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Capital Improvement Projects Fund.............

Nonmajor Governmental Funds:

Combining Balance Sheet....... . ....... . .. .......... ......... .......... . .... . .... .... ................... 123 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances.................. 129 Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Community Development Block Grant Special Revenue Fund.....

Housing Authority Special Revenue Fund
HOME Program Special Reverfue Fund
Housing Successor Special Revenue Fund.

Law Enforcement Grants Special Revenue Fund........... 135
136
137
138
139
140
141
142
143
144
145
146
147
. 148
149
150
151
152
153
154
Asset Forfeiture Special Revenue Fund..

Air Quality Improvement Special Revenue Fund....

Traffic Safety Special Revenue Fund........

Gas Tax Special Revenue Fund......

Street Sweeping Special Revenue Fund..

Prop A Transit Special Revenue Fund.

Prop C Transit Special Revenue Fund.

UDAG Special Revenue Fund.......

Public Access Corporation Special Revenue Fund..........

Street Lighting & Landscaping Special Revenue Fund Measure R Transit Special Revenue Fund
Road Repair & Accountability Act Special Revenue Fund.

Measure M Transit Special Revenue Fund........

Park Enhancement Special Revenue Fund
CASp Special Revenue Fund...
21 643

CITY OF SOUTH GATE
Annual Comprehensive Financial Report
For the Year Ended June 30, 2022
FINANCIAL SECTION (Continued)
Table of Contents
Page
Supplementary Information (Continued):

Nonmajor Governmental Funds (Continued) :

Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Measure W Stormwater Special Revenue Fund.... ........ ....... ...... .. .......... ..... . .....

Used Oil Recycling Program Special Revenue Fund.....

Beverage Container Recycling Program Special Revenue Fund Road Mitigation Program Special Revenue Fund
Housing Authority - Development Projects Special Revenue Fund Emergency Housing Voucher Special Revenue Fund
SB 2 Grant Special Revenue Fund
Leap Grant Special Revenue Fund
Internal Service Funds:

Combining Statement of Net Position...

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

Combining Statement of Cash Flows..............
155
156
157
158
159
160
161
162
165
167
169
Agency Funds:

Combining Statement of Fiduciary Asset and Liabilities Statement of Changes in Fiduciary Net Position

ST ATISTICAL SECTION
175
176
Statistical Section Overview..

Net Position by Component..

Changes in Net Position
Fund Balances of Governmental Funds
Changes in Fund Balances of Governmental Funds.

Governmental Activities Tax Revenues by Source...

Direct and Overlapping Property Tax Rates.............

Assessed Value ofTaxable Property..

Principal Property Taxpayers...

Property Tax Levies and Collections...............

Ratios of Outstanding Debt by Type.

Direct and Overlapping Debt..

Legal Debt Margin Information...

Pledged Revenue Coverage......

Demographic and Economic Statistics
Full-Time Equivalent City Employees by Function......

Operating Indicators by Function.......

Capital Asset Statistics by Function......
180
.181
183
189
igi
195
196
198
200
201
202
203
205
207
208
209
210
212
22 644
City of
South
(,ate-
Department ofAdministrative Services 8650 California Avenue South Gate, CA 90280-3075
www.cityofsouthgate.org
P:(323) 563-9527
F: (323) 563-9552
June 30, 2022
Honorable Mayor, Members of the City Council and
Residents of the City of South Gate:

The Aru'iual Comprehensive Financial Report (ACFR) of the City of South Gate for the Fiscal Year ended June 30, 2022, is hereby presented as mandated by both local ordinances and state statutes.

These ordinances and statutes require that the City of South Gate issue annually a report on its financial position and activity, and that an independent fum of certified public accountants audit this report. Responsibility for both the accuracy of the data, and the completeness and fairness of the presentation, including all disclosures, rests with the City. To the best of our knowledge and belief, the enclosed data is accurate in all material respects and is reported in a manner that presents fairly the financial position and results of operations of the various funds and component units of the City of South Gate. To the best of our knowledge and belief, there are no misstatements of mateiial fact within the financial statements or omissions of material fact which would cause the financial statements to be misleading. All disclosures necessary to enable the reader to gain an understanding of the City's financial activities have been included.

The financial section of the ACFR includes Management's Discussion and Analysis (MD&A) of the financial activity. This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The City's MD&A can be found immediately following the repoit of the independent auditors in the financial section of the ACFR.

The financial reporting entity (the government) includes all the funds of the primary governrnent (i.e., the City of South Gate, as legally defined), as well as its component units, the South Gate Utility Authority, the South Gate Housing Authority, and the South Gate Public Financing Authority. A component unit is a legally separate entity for which the primary government is financially accountable.

PROFILE OF THE CITY OF SOUTH GATE
The City of South Gate, incorporated on January 20, 1923, under the general laws of the State of California. South Gate encompasses 7.4 square miles and is located in the heait of the Los Angeles Metropolitan area. The City is characterized by a high density, working class community with a population of 93,259 according to the State of California's Department of Finance. Services provided by the City include administration, police, public works, plaru'iing, building & safety, and parks & recreation. The City of South Gate provides a full range of services for the citizens delivered by the City's own employees. The City has its own Police Department but contract for fire services through the Los Angeles County Fire Department (LACFD), and contracts with other goveinmental entities or private companies for library and refuse collection. 23 645
Centrally located, South Gate is an ideal location for commerce within a 15-mile radius of downtown Los Angeles, Los Angeles Intemational Airport, and the Ports of Los Angeles and Long Beach. The City is linked to these sites by several major transportation thoroughfares, including the I-710 (Long Beach) and I-105 (Centuiy) freeways, Firestone and Alameda Boulevards, and an extensive rail system with services provided by the Union Pacific and Southern Pacific Railroads.

With a diverse mix of residential, commercial and industrial areas, the City has promoted itself as an area rich in economic opportunities and continues to have many projects slated for development that will play a significant role in revitalizing the community.

The City has operated under the council-manager foim of government since incorporation. Policy- making and legislative authority are vested in the governing City Council, which consists of five Council Members, including the Mayor and Vice-Mayor. The City Council is responsible for, among other things, passing ordinances, adopting the budget, appointing committees, and hiring the City Manager and the City Attomey. The City Council is elected on a non-partisan, at-large basis.

Council Members are elected to four-year staggered terms with two or three Council Members elected every two years. Each year, the City Council selects the Mayor and Vice Mayor for a one- year term. The City Manager is responsible for carrying out the policies and ordinances of the City Council, for overseeing the day-to-day operations of the City, and for appointing the heads of the City's departments.

FINANCIAL INFORMATION
Internal Control
The Administrative Services department of the City is responsible for establishing and maintaining an appropriate internal control structure. The internal control system is designed to ensure that the assets of the City are protected from loss, theft, or misuse and to ensure that adequate accounting data is 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 a control should not exceed the benefits likely to be derived; and (2) the valuation of costs and benefits requires estimates and judgments by management.

Budgetary Controls
The City of South Gate maintains budgetary controls. The objective of these budgetary controls is to ensure compliance with legal provisions contained in the annual appropriated budgets approved by the City Council. Activities of the General Fund, Special Revenue funds, Capital Projects funds, Debt Service funds and the Proprietary funds are included in the annual appropriated budgets of the government units. The level of budgetary control (that is, the level at which expenditures cannot legally exceed the appropriated amount at the department level, which is the legal level of control) is established at the department level witin each fund. Formal budgetary integration is employed as a management control device. The City also maintains an encumbrance accounting system as one method of maintaining budgetary control.
24 646
Budget to Actual Comparison
For the fiscal year ended June 30, 2022, the City experienced a $2. IM favorable budget variance in general fund revenues and a favorable $3.2M budget variance in general fund operating expenditures resulting in $5.3M net positive budgetaiy variance. The total actual general fund operating expenditures exceeded revenues by $2.6M. The City also transferred in $21.9M to the Sewer Enterprise Fund to satisfy a loan used to fund capital improvements. An additional 6.4M was transferred to Internal Services Funds, which brought the prior fiscal year general fund balance from

60.3M to 40M for the fiscal year ended June 30, 2022.Many of the favorable revenue and expenditure variances were the result of conservative budget practices and continued careful management of resources during FY 2021/22.

Significant Financial Events
The Governtnental Accounting Standards Board (GASB) is a private, non-governmental organization that creates accounting reporting standards, or generally accepted accounting piinciples (GAAP), for state and local governments. Changes in accounting policies issued by the Board, known as GASB Statements, will impact how the City reports and compiles its financial report. During the fiscal year ended June 30, 2022, the City implemented the following new GASB Pronouncement.

GASB Statement No. 87 - Leases statement increases the usefulness of governments' financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract. It establishes a single model for lease accounting based on the foundational principle that leases are financings of the right to use an underlying asset.

Under this Statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a defeired inflow of resources, thereby enhancing the relevance and consistency of information about governments' leasing activities

OTHER INFORMATION
Independent Audit
The City requires an annual audit by independent certified public accountants. The accounting firm of Davis Farr LLP conducted this year's audit. The auditors' report on the government-wide financial statements and the combining and individual fund statements and schedules is included in the financial section of this report.

Single Audit
As a recipient of federal, state and county financial assistance, the City is responsible for ensuring that an adequate internal control structure is in place to ensure compliance with applicable laws and regulations related to those programs. This internal control structure is subject to periodic evaluation by management. Beginning with the single audit of fiscal years beginning on or after 25 Vl
647
January 1, 2015, tlie U. S. Office of Management and Budget (OMB) raised tlie single aridit tliresliold for federal awards from $500,000 to $750,000. Wlien over $750,000 fron'i Federal financial assistance programs is expended in any one fiscal year, tlie City is required to undergo a single audit in conformity witli tlie provisions of tlie Single Audit Act An'iendments of 1996 and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniforin Administrcitive Reqxrireinents, Cost Principles, and Audit Requireinents.for Federal Awaits (Uniform Guidance). For tl'ie year ended June 30, 2022, approximately $11.3M in Federal financial assistance progran'i fiuids were expended.

GFOA Certificate of Achievement Award
The Govenunent Finance Officers Association of tlie United States and Canada (GFOA) oversees a prestigious national award program to recognize confonnai'ice witli tlie liigliest standards of report preparation. To be awarded a Ceitificate of Acliievement, a govemn'ient unit must publisli an easily readable and efficiently organized Ai'uuial Compreliensive Financial Repoit (ACFR). Tliis report must satisfy botli Generally Accepted Accounting Principles and applicable legal requiren'ients. A Certificate of Acliievement is valid for a period of one year only.

Tlie City of Soutli Gate strives to acl'iieve tliis prestigious award eacli year. Tlie City of Soutli Gate submitted its ACFR for tlie fiscal year ended Jruie 30, 2021 for tlie GFOA award of Ceitificate of Acliievement for Excellence in Financial Reporting. Tlie award is still being reviewed by tlie GFOA. We also believe our June 30, 2022, ACFR continues to meet tlie Certificate of Acliievement Program's requirements and we are submitting it to tlie GFOA to determine its eligibility for anotlier certificate.

ACKNOWLEDGEMENTS
Tlie preparation of tliis report could not liave been accomplislied witliout tlie liard work and dedicated service of tlie Finance Division staff. We would like to express our appreciation to all members of tlie Finance Division and to Davis Farr LLP, tlie City's independent auditors, for tl':ieir expertise, guidance, assistance, and professionalism in preparing tliis year's repoit. Finally, we worild like to express our sincere tliai'iks to tlie City Council, wliose strong and effective leadersliip and continuous suppoit lias made tlie preparation of tliis report possible.

Respectfully submitted,
Cl'u:is Jeffers
City Manager
Kristoplier Ryan
Director of Adn'iinistrative Services/Finance
26 648

CITY OF SOUTH GATE

ELECTED AND ADMINISTRATIVE OFFICIALS
Mayor
Vice Mayor
Councilmember
Councilmember
Councilmember
City Clerk
City Treasurer
City Manager
City Attorney
Assistant City Manager/Director of Public Works
Police Chief
Director of Administrative Services
Director of Community Development
Acting Director of Parks & Recreation
Al Rios
Maria del Pilar Avalos
Maria Davila
Denise Diaz
Gil Hurtado
Yodit Glaze
Greg Martinez
Chris Jeffers
Raul Salinas
Arturo Cervantes
Darren Arakawa
Kristopher Ryan
Meredith Elguira
Steve Costley
27 649

CITY OF SOUTH GATE
Citizens of
South Gate
(Elected)
Citv Council
(Eltx:ted)
EE(Elected)
Administrative Services
Finance
Purchasing
Business License
Water Customer Service
Human Resources
Risk Management
Infomiation Systems
Citv Manager
(Appointed)
Parks & Recreation
Administration
Classes & Special Events
Sports & Aquatics
Maintenance & Custodial
Golf Course
Resource Center
TransiijSenior Center
Cihi Attornev
(Appointed)
Police
Administration
Patro}
Support Services
Traffic Safety
Asset Forfeiture
Community Development
Administration
Building Inspections
Planning
Code Enforcement
SCAQMD
Rideshare
Housing Authority
Home Programs
CDBG Projects
Successor Agency
Public Works
Engineering
General Maintenance
Graffiti Abatement
Stormwater
Street Maintenance
Street Sweeping
Transit/Prop C
Street Lighting
Water Operations
Sewer Maintenance
Refuse Collection
Fleet Service
IX 28
650
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of South Gate
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2020
Executive Director/CEO
651
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of South Gate
California
For its Annual Comprehensive Financial Report
For the Fiscal Year Ended June 30, 2021
is still pending review with Government Finance Officers Association 30 652
II !,,=L'i,>!g,r.r
Davis Farr LLP
230'l Dupont Drivel Suite 2001 Irvii'ie, CA 92612
Mciin: 949.474.2020 i Fax: 949.203.5520

INDEPENDENT AUDITOR'S REPORT
The Honorable Mayor and
Members of the City Council
of the City of South Gate
South Gate, California
Report on the Audit of the Financial Statements
Opinion
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 South Gate (the City), as of and for the year June 30, 2022, and the related notes to the financial statements, which collectively comprise the City's basic financial statements as listed in the table of contents.

In our opinion, the accompanying financial statements present fairly, in all material respects, the respective financial position of the governmental activities, the business type activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2022, and the respective changes in financial positi.on 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 Opinion
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. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Emphasis of Matters
During the year ended June 30, 2022, the City implemented Governmental Accounting Standards Board (GASB) Statement No. 87: Leases. Additionally, the financial statements for the fiscal year ended June 30, 2022 reflect certain prior period adjustments as described further in note 17 to the financial statements. Our opinion is not modified with respect to these matters.

Responsibilities of Management for the Financial Statements The City's 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 one year after the date that the financial statements are issue
31 1 653
Auditor's Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS 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, 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 pension and OPEB schedules, and the budgetary comparison schedules identified as Required Supplementary Information (RSI) in the accompanying table of contents be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial 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 auditing standards generally accepted in the United States of America, which consisted ofinquiries 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.
32 2
654
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 nonmajor fund financial statements and schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements.

The combining and individual nonmajor fund financial statements and schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial statements 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 Comprehensive Financial Report. The other information comprises the introductory section and statistical section but does not include the financial statements and our auditor's report thereon. Our opinions on the 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 financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the 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 GovernmentAuditing Standards, we have also issued our report dated December 22, 2022 on our consideration oT 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 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.

Z,L/
Irvine, California
December 22, 2022
33 3 655
City of South Gate
Management's Discussion and Analysis (Unaudited)
Year Ended June 30, 2022
The following discussion and analysis of the financial perfoririance of the City of South Gate provides an overview of the City's financial activities for the fiscal year ended June 30, 2022. It should be read in conjunction with the financial statements identified in the accompanying table of contents.

Financial Highlights
Government-wide Financial Statements
* Net Position: The total assets and deferred outflows of the City of South Gate exceeded total liabilities and deferred inflows at the close of the fiscal year ended June 30, 2022, by $268.IM. This amount is referred to as the net position of the City. Of this amount, $261.9M is invested in capital assets, $49.3M is restricted for public works, housing activities, community development projects, public safety and debt service, and $43. IM is an unrestricted deficit amount.
* Changes in Net Position: The City's net position decreased by $5.5M year over year (from $273.6M prior fiscal year ending balance to $268.1M balance as June 30, 2022). Goverental Activities decreased by $30.4M while Business-type activities increased by $24.8M in net position. * Long-Teri'n Debt: The City's total long-term liabilities decreased from $189.2M to $151.5M year over year as of June 30, 2022, a net decrease of $37.7M. The net decrease was mainly from decreases of $39.9M in pension liability and $3. IM from the paydown of outstanding bonds and lease obligations. * Capital Assets: The City's capital assets totaled $289.8M on June 30, 2022, a net increase of $6.9M over the prior year balance of $282.9M. $7.5 million was a net increase attributable to the governinental activities while $533 thousand was a net decrease attributable to the business-type activities.

Fund Financial Statements
* Governunental Funds: As of June 30, 2022, the City's goveriunental funds reported a combined ending fund balance of $83.5M, a decrease of $37.2M (31%) over the prior year's restated balance. * General Fund: As of June 30, 2022, expenditures and transfers-out exceeded revenues and transfers-in by $21.OM, decreasing the fund balance from $60.4M to $39.4M. Of the $39.4M fund balance, $24.4M is unassigned and is available for future appropriations at the City's discretion.

Using the Accompanying Financial Statements
This annual report consists of a series of financial statements. The Statement of Net Position and the Statement of Activities provide information about the activities of the City of South Gate as a whole and present a longer-term view of the City's finances. Also included in the accompanying reports are fund financial statements. For governmental activities, the fund financial statements tell how these services were financed in the short term as well as what remains for future spending. Fund financial statements also report tlie City's operations in more detail than the goveri'unent- wide statements by providing infoimation about the City's most significant funds. The remaining statements provide financial infonnation about activities for which the City acts solely as a trustee or agent for the benefit of others outside of the governinent.

Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the City's basic financial statements, which are comprised of three components: l) governt'nent-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This annual comprehensive financial report also contains other supplementary information in addition to the basic financial statements themselves. 4 34
656
City of South Gate
Management's Discussion and Analysis (Unaudited)
Year Ended June 30, 2022
Government-wide financial statements: The government-wide financial statements are designed to provide readers with a broad overview of the City of South Gate's finances, in a manner similar to a private-sector business.

The statement of net position presents information on all of the City of Soutl'i Gate's assets (including deferred outflows of resources) and liabilities (including defeired inflows of resources), with the difference between them reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City of South Gate is improving or deteriorating.

The statement of activities presents infornnation on how the City's net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in fuhire fiscal periods (e.g. uncollected taxes and earned but unused vacation leave).

Both statements include not only the City of South Gate itself (known as the primary governmerrt) but also the South Gate Utility Authority, the South Gate Housing Authority and the South Gate Public Financing Authority, for which the City of South Gate is financially accountable. Financial inforination on these component units is reported separately from the financial inforination presented for the primary government itself.

After the dissolution of the South Gate Community Development Commission (Redevelopment Agency), the City of South Gate elected to become the Successor Agency for the former Community Development Commission and the remaining assets and activities of the dissolved redevelopment agency were reported in a fiduciaiy fund (private- puipose trust fund) in the financial statements of the City.

Fund financial statements: A fimd is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City of South Gate, like other state and local governinents, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City of South Gate can be divided into three categories: governinental funds, proprietary funds and fiduciary funds.
* Governntental funds. Most of the City's basic services are reported in gover'ental funds, which focus on how money flows into and out of those funds and the balances left at year end that are available for spending. These funds are reported using the modified accrual basis of accounting, which measures cash and all other current financial assets that can readily be converted to cash. The governinental fund statements provide a detailed short- teri'n view of the City's general goveri'iment operations and the basic services it provides. Goveri'irnental fund infon'nation helps deterinine whether there are more or fewer financial resources that can be spent in the near future to finance the City's programs. The relationship or differences between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental fimds are described in the reconciliation at the bottom of the fund financial statements. * Proprietary funds. When the City charges customers for the services it provides - whether to outside customers or to other units of the City - these services are generally reported in proprietaiy funds. Proprietaiy funds are reported in the same way that all activities are reported in the Statement of Net Position and the Stateinent of Activities. In fact, the City's enterprise funds (a component of proprietaiy funds) are the same as the business-type activities reported in the government-wide statements but provide more detail and additional inforination, such as cash flows, for proprietary funds. Internal service funds (the other component of proprietary funds) are used to repoit activities that provide supplies and services for the City's other programs and activities. * Fiduciary fiinds. The City of South Gate is an agent for certain assets held for, and under the control of, other organizations and individuals. All of the City's fiduciary activities are repoited in a separate Statement of Fiduciary Assets. These activities are excluded from the other financial statements because the City cannot use these assets to finance its operations. The City is responsible for ensuring that the assets reported in these funds are used for their intended purposes.
5 35
657
City of South Gate
Management's Discussion and Analysis (Unaudited)
Year Ended June 30, 2022
Notes to the basic financial statements. The notes provide additional inforination that is essential to a full understanding of the data provided in the governinent-wide and fund financial statements. The notes to the financial statements can be found on page 42 immediately following the basic financial statements.

Other information. In addition to the basic financial statements and accompanying notes, this annual comprehensive financial report also presents certain required sttpplementary information, providing budgetary comparison schedules for budgeted versus actual revenues and expenditures of the City's major funds.

The combining statements referred to earlier in connection with the non-major governrnental funds and internal service funds are presented immediately following the required supplementary inforination on budget comparisons.

Government-wide Financial Analysis
As noted earlier, net position may serve over time as a useful indicator of a government's financial position. For City of South Gate, assets and deferred outflows of resources exceed liabilities and deferred inflows of resources by $265.9M on June 30, 2022, as shown in Table 1.

Current and other assets
Capital assets
Total assets
Deferred Oritflows
Total Deferred Outflows
Long-term debt outstanding
Other liabilities
Total liabilities
Defei'red Inflows
Total Deferred Inflows of
Resources
Table 1
Statement of Net Positions
(3ovenmiental
Activities
2022
$ 124,339,561
239,899,328
364 ,238,889
23,738,468
23,738,468
108,006,651
24,355,165
132 ,361,816
48,669,492
48,669,492
2021
$ 144,880,902
240,697,494
385,578,396
20,447,980
20,447,980
145,805,183
13,742,328
159,547,511
9,118,980
9,118,980
Business-Type
Activities
2022 2021
$ 53,103,099
49,945. 175
103,048,274
2,327.815
2,327,815
33,241,148

8.126.478
41,367,626
$ 30,793,468
50,478,247
81,271,715

2.241,488
2,241,488
37,569,467
9,012,191
46,581,658
2,895,701
2,895,701
656,027
656,027
Total
2022
$ 177,442,660
289,844,503
467,287,163
26,066,283
26,066,283
141,247,799
32,481,643
173,729,442
51,565,193
51,565,193
2021
$ 175.674.370
291. 175,741
466,850,111
22,689,468
22,689,468
183,374,650
22,754,519
206,129,169
9,775,007
9,775,007
Net position:

Investedinnetcapitalassets 239,101,781
Restricted 49,311,796
Unrestricted (deficit) (81,467,528)
Total net position $ 206,946,049
239,643,790
61,928,090
(64,211,995)
$ 237,359,885
22,811,740
38,301,022
$ 61,112,762
20,711,825
846,419
14,717,274
$ 36,275,518
261,913,521
49,311,796
(43, 166,506)
$ 268,058,811
260,355,615
62,77 4,509
(49,494,721)
$ 273,635,403
The largest portion of the City's net position reflects its investment in capital assets (e.g., land, buildings, machinery and equipment) of $261.9M, less any related debt used to acquire those assets that is still outstanding. The City of South Gate uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves "" 36
658
City of South Gate
Management's Discussion and Analysis (Unaudited)
Year Ended June 30, 2022
cannot be used to liquidate these liabilities. Another portion of the City's net position, $49.3M, represents resources that are subject to external restrictions in how they may be used. The remaining Unrestricted Net Position (deficit) balance of $43.1M is $6.3M more than it was in FY 2020/21.

Revenues
Program revenues :

Charges forservices $
Operating grants & contn'bution:

Capital grants & contributions
General revenues :

Property taxes
Sales taxes
Other taxes
Investinent income
Other revenues
Total rewinues
Program expenses
Ceneral governinent
Public works
Parks & recreation
Police
Community development
hiterest expense
Sewer
Water
Refuse
Total expenses
Reienues owr (under)
expendihires
Table 2
Statement of Changes in Net Position
(3overninental
Activities
Business-type
Activities
2022
8,437,224 $
33,777,737
10,387,141
15,462,214
27,689,344
5,730,603
(2,243,040)
858,214
100,099,437
1578,443
19,188,975
8,774,974
34,486,871
11,374,303
649,620
82,053,186
18,046,251
2021
9,749,871
28,487,051
24,999,083
15,082,297
25,106,247
5,482,779
225,984
570,861
109,704,173
7,646,438
22,509,065
8,526,385
34,518,786
13,738,406
702,810
87,641,890
22,062,283
2022
$ 25,184,185
137,101
(1,324,133)
23,997,153
1,751,215
15,070,542
4,324,468
21,146,225
2,850,928
2021
$ 24,894,165
11,065
61,524
24,966,754
1,223,295
14,001,403
4,162,820
19 ,387,518
5,579,236
Total
2022
$ 33,621,409 $
33,914,838
10,387,141
15,462,214
27,689,344
5,730,603
(3,567,173)
858,214
124,096,590
1578,443
19,188,975
8,774,974
34,486,871
11,374,303
649,620
1,751,215
15,070,542
4,324,468
103,199,411
20,897,179
2021
34,644,036
28,498,116
24,999,083
15,082,297
25,106,247
5,482,779
287,508
570,861
134,670,927
7,646,438
22,509,065
8,526,385
34,518,786
13,738,406
702,810
1,223,295
14,001,403
4,162,820
107,029,408
27,641,519
Transfers
Changes in Net Pos ition
Beginning net position, restated
Ending net position, restated
(21,986,316)
(3,9 40,065)
210,886,114
$ 206,946,049
1,591
2 2,063,874
215,296,all
$ 237 ,359,885
21,986,316
24,837,244
36,275,518
$ 61,112,762
(1,591)
5,577,645 ' 20,897,179
30,697,873 247,161,632
$ 36,275,518 $ 268,058,811
27,641,519
245,993,884
$ 273,635,403
Governmental Activities. See Table 2. The city's net position attributable to governinental activities decreased by $30.4M as of June 30, 2022. Program revenues decreased by $10.6M in FY 21-22 mainly from less capital grants received during the year. General revenues increased $1.OM compared to prior year. Property tax increased by about $380K, sales tax increased by $2.6M while investment income decreased by approximately $2.5M due to unrealized mark to market valuation losses. Program expenses decreased by $5.5M from $87.6M in FY 2021 to $82.1 in FY 2022, primarily from public works and community development. However, the main reason for the decrease in net position comes from a 2001 City Loan to the South Gate Utility Authority Sewer Enterprise for $21,985,000 being deemed satisfied and discharged.
7 37
659
City of South Gate
Management's Discussion and Analysis (Unaudited)
Year Ended June 30, 2022
The City of South Gate relies heavily on federal, state, and local grant funds (44%) as a major funding source for capital projects and eligible operating costs. After grants, sales tax (28%), property taxes (15%) and charges for services (8%) remain the most significant sources of the Goveriunental Activities revenue stream.

Revenues by Source - Governmental Activities
lnvestment Income
-2%
The cost of all govermnental activities this year was $87.6M compared to $79.6M in the prior year. Goveinmental activities generated sufficient revenues to pay these costs with $9.38M paid for by those who directly benefited from programs provided, $43.5 being subsidized by grants received from other governinental organizations for both capital and operating activities, and $46.5M coming from general taxes and other revenues. 8 38
660
City of South Gate
Management's Discussion and Analysis (Unaudited)
Year Ended June 30, 2022
Expenses and Program Revenues - Governmental Activities ?
a
i
lt
OExpaiies CIProgrm Ret'enues
j
!
!....
6='
I
4 II"
li
i*if ,, ,
j'4
I ': '
j§
l=: .
;(
+!
{i
'i
J
t
li
__J'
1 ..iE+__- :

Gei eral
Goveninient
Poiice Public Works
Coniruinity
Development
Par):s &
Recreation
Interest
expense
OExpenses $7.578,443 $34.486,871 $19,188,975 $11,374,303 $8,774,974 $649.620 0Pronam Revenues $3,212,623 $10,967.187 $28,197,385 $9,064,711 $1.160,196 $- 9 39
661
City of South Gate
Management's Discussion and Analysis (Unaudited)
Year Ended June 30, 2022
The City's largest expense is the Police Department, where operations totaled $34.5M in FY 2021-22. Public Works followed with $19.2M of expenses, which included expenses related to several large capital improvement projects.

Community Development was the third largest in expenses, at $11.4M, wich included Federal Housing and Urban Development (HUD) funds.

Business-Type Activities. As of June 30, 2022, the financial condition of the City's business-type activities was a positive net position of $61.1M, a $24.8M increase from $36.3M beginning net position. The increase in net position is mainly attributed to the 2001 City Loan to the South Gate Utility Authority Sewer Enterprise for $21,985,000 being deemed satisfied and discharged.

The city business-type activities consisted of the water, sewer and refuse utilities. The combined cost of providing all business-type activities this year was $21.2M. The revenue paid by users of these utilities was $25.3M of which 77.3% comes,from water fees, 17.7% from refuse fees and 5.0% from sewer fees. When capital improvei'nents are made, the costs are capitalized and no expenses are incurred given that current assets have been converted to long-ten'n capital assets.

The water utility user rates are set to generate some excess of revenues over expenses in an effort to maintain a reasonable reserve for capital improvements and debt service requirements. A sewer rate study is underway to ensure that the sewer utility is similarly sustained financially to cover its operating and capital requirement costs. The city contracts out the refuse collection and disposal, and the user rates are set to cover the contractual costs and related administration costs. See below revenue and expense chart.

Revenues by Source - Business-Type Activities
Sewer

5.0%
Refuse
Water

77.3%
10 40
662
Ctty of South Gate
Management's Discussion and Analysis (Unaudited)
Year Ended June 30, 2022
Expenses and Program Revenues - Business-Type Activtttes aExpeniet aPmg Revenuei
p
!l
!,
fl7
!
il
il, ,
:

Il
i
I
i
:

I
i
I
:
k<ltt'bAa a'a + Th T r=iI
Water Sewer Refuse
CJ Expenses $15,070,542 $1,751,215 $4,324,468
OProgram Revenues $19,564,619 $1,272,304 $4,484,363
Financial Analysis of the City's Funds
As noted earlier, the City of South Gate uses fund accounting to ensure and demonstrate compliance with finance- related legal requirements.

Governmental Fundss The focus of the City's goveiumental funds is to provide information on near-teri'n inflows, outflows and balances of spendable resources. Such information is useful in assessing tlie City of South Gate's financing requirements. In particular, spendable fund balance may serve as a useful measure of a government's net resources at the end of the fiscal year.

As of June 30, 2022, the City's governmental funds reported combined ending fund balances of $83.5M, a decrease of $37.2M from prior year. Of that amount, $2.1M constitutes nonspendable fund balance. Of the remaining $81.4M spendable fund balance, $44.8M is restricted because it is subject to external enforceable legal obligations, $12.5M is committed for such things as an emergency reserve, the employinent resource center, a budget stabilization fund, and an OPEB Section 115 trust, $5.OM has been assigned by management for specific puiposes such as capital projects, and the remaining $19M is vmassigned and is available for future appropriations at tlie City's discretion.

The General Fund is the chief operating fund of the City of South Gate. As of June 30, 2022, the total general fund balance was $39.4M, a decrease of $20.9M from prior year. The main reason for the decrease in net position comes 11 41
663
City of South Gate
Management's Discussion and Analysis (Unaudited)
Year Ended June 30, 2022
from a 2001 City Loan from the General Fund to the Sewer Fund for $21,985,000 being deemed satisfied and discharged. The unassigned fund balance totaled $24.4M.

For FY 2021/22 General Fund revenues increased by 2.3M (4.0%) over the prior year from $55.4M to $57.7M, operating expenditures increased by $2.5M from $53.1M to $55.6M. In summary, General Fund revenues exceeded expenditures by approximately $2. IM for the fiscal year ended June 30, 2022.

The Grants Special Revenue Fund is used to account for all Federal, State and local grants not specified in other funds.

As of June 30,2022, the Grants Special Revenue fund balance had a deficit of $3.4M. This is attributable to $4.7M in unavailable revenue that has been earned but not yet available. This is due to recognizing grant receipts for expenses incurred that don't meet the reporting period's availability criteria.

In March 2021, congress passed the $1.9 trillion American Rescue Plan Act of 2021 (ARPA). The city's allocable share amounted to $34.5M. The initial disbursement of $17.25M was received by the City in June 2021. The second payment of $17.25M was received in July 2022. The ARPA monies can be used to recover revenue loss due to the Pandemic, fund infrastructure projects including water, sewer and broadband and respond to public health emergency due to COVID-19 Pandemic including assistance to households, small business, and nonprofits organizations. For FY 2021/22, the City had $9.9M in expenditures fiinded by ARPA.

The Capital Improvement Projects Fund accounts for most of the capital improvement activity in the City, such as buildings and street infrastructure. Capital expenditures are charged directly to this fund and reimbursed with transfers from other funds as monies are received from the various funding sources, primarily grants. As of June 30, 2022, the total fund balance was $4.9M, of which $3.5M is designated for the Courthouse Rehabilitation project, which the City envisions repurposing the building for future city uses. 2he other non-major governmental funds include several special revenue funds used exclusively to account for intergovernmental and assessment proceeds which are restricted by law as to their use. This group of funds includes the Community Development Block Grant, HOME Program, Housing Successor, Gas Tax, Asset Forfeiture, Prop A and C Local Returns, Measure R, Measure M, Street Lighting & Landscaping, and various other grant funds.

Proprietary Funds: The City's proprietary funds consist of the Water, Sewer and Refuse Funds, which are the business-type activities that account for the operation of those utilities. Also included are the internal service funds, which provide for supporting governtnental activities including insurance activities, inforination systems, fleet management, capital asset & equipment replacement, and building & infrastructure maintenance.

In the business-type activities, the Water and Sewer Funds are considered major funds. The Refuse Fund is considered non-major. Atfiscalyearend,thecombinednetpositionofthesefundstotaled$61.1M,anincreaseof$24.8M(68.5%) from the beginning fund balance mainly as a result from a 2001 City Loan to the South Gate Utility Authority Sewer Enterprise for $21,985,000 being deemed satisfied and discharged. Additionally, resources used for the construction of capital facilities do not result in expenses because the assets are capitalized.

The internal service funds include Insurance Fund, Information Systems Fund, Fleet Management Fund, Capital Asset & Equipment Replacement Fund and Building Maintenance Fund. The internal services funds account for goods and services provided by one City deparhnent to other City departments. The net position increased by $2.6M from $1.6M beginning fund balance to $4.2M as of June 30, 2022, largely because of delays in replacing vehicles and equipment due to supply chain issues and decrease in net pension liability.

General Fund Budgetary Highlights
For FY 2021/22, the final adopted General Fund revenue budget was $56. IM. The actual revenues came in $1.6M (2.9%) higher than projected at $57.7M, and mostly because of increases in tax revenues. Overall, property tax 12 42
664
City of South Gate
Management's Discussion and Analysis (Unaudited)
Year Ended June 30, 2022
increased $380K, sales tax increased $2.6M and other taxes increased $1.5M. Charges for Services were up by $1.1M, mainly due to the reopening of recreational activities, and Licenses and Pen'nits were down by $26K. Use of money and property were down nearly $1M mostly because of lower interest rate environment and the resulting "unrealized" inveshnent losses as of June 30, 2022. Total achial expenditures came in at $55.6M, which is $3.2M (5.5%) lower than the final projected expenditure budget of $58.8M. The main attributable factor for the decrease in expenditures was largely due to staff vacancies resulting in $3.4M in savings.

Capital Asset and Debt Administrahon
Capital Assets: The capital assets of the City are assets used in the perfori'nance of City functions including infrastructure assets. Capital Assets include equipment, buildings, land, park facilities and roads. As of June 30, 2022, tl'ie City's net investment in capital assets for goveriunental activities totaled $239.9M and net investment in capital assets for business-type activities totaled $49.9M. Governinental capital assets had a net increase of $7.5M mainly due to the completion of $18.5M in infrastructure projects and $3.4M in building improvements, less $9.7M in depreciation and$9.8Minprioryearrestatements. Business-typecapitalassetsdecreasedby$533Kwithadditionstowaterfacilities improvements of $2.3M reduced by accumulated depreciation of $2.8M.

City of South Gate Capital Assets
(Net of depreciation)
Governmental
Activities
2022 2021*
Business-Type
Actiiities
2022 2021 2022
Total
2021"
Structures and improvements $
Machinery and eqrupment
Infrastnicture
Utility distribution system
Lind
Construction in progress
Lease assets
Water riglits
Total
13,838,824
4,080,680
204,037,489
$ 11,195,164
4,615,926
193,651, 175
3,738,993
14,076,026
127,316
3,738,993
19,019,773
158,982
$239,899,328 5i232,380,013
$ 7,926,948
1,308,360
$ 2,600,018 $
1,503,564
37,302,468
1,290,602
183,653
39,769,208
1,290,602
3,381,711
1,933,144
$49,945,175
1,933,144
$50,478,247
21,765,772
5,389,040
204,037,489
37,302,468
5,029,595
14,259,679
127,316
1,933, 144
$289,844,503
$ 13,795,182
6,119,490
193,651, 175
39,769,208
5,029,595
22,401,484
158,982
1,933,144
$282,858,260
* The balance at July 1, 2021 has been restated to reflect the implementation of GASB 87 and to correct certain prior period adjustments as described turtl'ier in note 17.

Additional information on the City's capital assets can be found in Note 7 of tlie Notes to tlie Basic Financial Statements of this report.

Long-TermLiabilities. Attheendofthefiscalyear,theCityofSouthGatehadtotallong-termliabilitiesof$l51.5M, a decrease of approximately $37.8M over the prior year balance. The net change is attributable to a combination of increases of $4.4M in claims and judgements liability and $1.2M in other post-employinent benefits liability, with decreases of $39.9M of actuarially deten'nined decreases in pension liability, $0.7M in compensated absences liability, and $2.8M in tlie paydown of tlie City's outstanding revenue bond, pension obligation bonds and other financing agreements.
13 43
665
City of South Gate
Management's Discussion and Analysis (Unaudited)
Year Ended June 30, 2022
City of South Gate Long-Term Liabilities
Governmental
Activities
2022 2021
Business-Type
Activities
2022 2021 2022
Total
2021
Revenue bonds $
Pension obligation bonds
Financing agreements
Lease Payable
Notes/loans payable
Claims and judgments
Compensated Absences
Otherpost-einployment benefits
Net pension liability
Total $
10,085,000
673,019
124,528
13,077,396
4,929,052
27,422,713
51996,37}
114,308,079
11,480,000
500,241
10,771,328
5,628,554
26,359,3 10
95,188,598
$149,928,031
$ 28,998,877 $ 30,713,226 $
355,666
2,781,79)1
2,886,673
$35,023,014
372,380
2,620,475
5,609,552
$39,315,633
28,998,877 $

10.085,000
673,019
124,528
13,077,396
5,284,718
30,204,511
60,883,044
$149,331,093
30,713,226
11,480,000
500,241
10,771,328
6,000,934
28,979,785
100,798, 150
$189 ,243,664
Additional information on the City's long-term liabilities can be found in Note 8 of the Notes to the Basic Financial Statements of this report.

Economic Factors and Next Year's Budget
Over the past year, despite continuing challenges of the COVID-19 pandemic and the associated impacts to both revenues and expenditures, the city has continued to effectively service and support our residents and businesses. While there have been steady improvements across all areas of the community, there is still more work to be done to ensure the City remains on solid financial ground for the years to come. Over the past year, the nation saw inflation hit a 40- year all-time high peaking at 9.1% in June 2022 with the unemployinent rate sitting around 3.6%. Economists are predicting that the US economic growth will slow to 2.0% in 2023 and 1.9% in 2024. Unemployment rates are also expected to rise in 2023 as the Fed increases interest rates causing the economy to slow down. However, California is being seen as faring more favorable than the nation and isn't likely to enter a recession in 2023 according to a UCLA Anderson forecast. Housing construction in California is outpacing the rest of the countiy and defense spending is also helping the state economy with the US Department of Defense increasing its budget by $33 billion in 2023. UCLA Anderson also projects employinent growth of 1. 1% in 2023 and 1.2% in 2024 for California if the state does not go into recession and employinent growth of.5% in 2023 and 1.3% in 2024 if it does.

Like tnany cities throughout California, South Gate is also facing significant continued increases in retiree pension and health care costs. Future salary increases and increased CalPERS pension costs are expected to put upward pressure on the budget over the next few years.

For FY 2022/23, the city adopted a Maintenance of Effort Budget with provisions to attend to critical needs. The FY 2022/23 citywide adopted operating and capital improvement budget totaling approximately $243M includes all city funds, including General fund and Other Governrnental funds, Water fund, Sewer fund, Housing Authority fund, Successor Agency fund Grants and Other Subventions, Special Assessment District funds, and Capital hnprovement Project funds.

General Fund Budget: The General Fund expendihire adopted budget for FY 2022/23 of $65.8M constitutes 27% of the citywide budget and reflects a 12.5% increase in General Fund expenditures over prior fiscal year. FY 2022/23 General Fund revenue adopted budget of $61.8M is a decrease of 7.2% over prior fiscal year receipts due to the one- time ARPA revenue losses of $8.8M the City claimed in FY 2021/22. Overall, the FY2022-23 General Fund adopted budget was balanced with draw down from fund balance reserves of about $4.OM to cover the projected deficit. 14 44
666
City of South Gate
Management's Discussion and Analysis (Unaudited)
Year Ended June 30, 2022
Requests for Information
This annual comprehensive financial report (ACFR) is designed to provide our citizens, taxpayers, customers and creditors with a general overview of the City's finances and to show the City's transparency and accountability for the money it receives and expends. If you have questions about this report or need additional financial information, please contact City Adtninistrative Services/Finance, by phone at (323) 563-9522, or by mail at 8650 California Avenue, South Gate, California 90280.
15 45
667

BASIC FINANCIAL STATEMENTS
46 16 668
This page intentionally left blank.
47 17 669

GOVERNMENT WIDE FINANCIAL STATEMENTS
48 18 670
City of South Gate
Statement of Net Position
June 30, 2022
ASSETS
Current assets:

Cash and investments
Receivables:

Accounts
Accrued interest
Lease
Internal balances
Prepaid items
Due from other governments
Inventories
Property held for resale
Total current assets
Noncurrent assets:

Restricted cash and investments with fiscal agent Notes and loans receivables
Capital assets:

Non-depreciable capital assets
Depreciable capital assets, net
Total capital assets
Total noncurrent assets
Total assets

DEFERRED OUTFLOWS OF RESOURCES
Deferred loss on refunding of debt
Deferred outflows of resources related to pensions
Deferred outflows of resources related to OPEB
Total deferred outflows of resources
Governmental
Activities
$ 84,911,372
1 ,650,945
116,661
782,286
(1,023)
57,031
2 2,429,902
223,736
4,950,000
115,120,910
452,082
8 766 569
17,815,019
222,084,309
239,899,328
249,117,979
364,238,889
18,427,811
5,310,657
23,738,468
Primary Government
Business-Type
Activities
$ 47,729,559
4,446,729
66,494
1,023
52,243,805
859,294
3,407,399
4 6,537,776
49 ,945,175
50 ,804,469
103,048,274
1 ,006,148
782,946
538,721
2 ,327,815
Total
$ 132,640,931
6 097 674
183,155
7 82,286
57,031
22,429,902
223,736
4,950,000
167,364,715
1,311,376
8 766 569
21,222,418
268 622 085
289,844,503
299,922,448
467,287,163
1,006,148
19,210,757
5,849,378
26,066,283
See accompanying Notes to the Basic Financial Statements. 49 19 671
City of South Gate
Statement of Net Position (Continued)
June 30, 2022

LIABILITIES
Current liabilities:

Accounts payable
Accrued liabilities
Retention payable
Accrued interest
Unearned revenue
Deposits payable
Due to other governments
Compensated absences - due within one year
Claims payable - due within one year
Long-term debt - due within one year
Total current liabilities
Noncurrent liabilities:

Compensated absences - due in more than one year
Claims payable - due in more than one year
Long-term debt - due in more than one year
Aggregate net pension liability
Total other postemployment benefits liability
Total noncurrent liabilities
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Deferred inflows of resources related to leases
Deferred inflows of resources related to pensions
Deferred inflows of resources related to OPEB
Total deferred inflows of resources

NET POSITION
Net investment in capital assets
Restricted :

Community development projects
Asset forFeiture program
Law enforcement
Public works
Capital projects
Low/mod income housing activities
Total restricted
Unrestricted (deficit)
Total net position
Governmental
Activities
5,479,838
1,064,408
869,671
45,298
9,238,805
1,353,844
1,873
450,648
3,845,757
2,005,023
24,355,165
4,478,404
9,231,639
8,877,524
57,996,371
27,422,713
108,006,651
132,361,816
758,674
40,572,059
7,338,759
48,669,492
239,101,781
13,760,738
2 ,561,903
3 79,187
28,319,789
58,800
4,231,379
49,311,796
(81,467,528)
$ 206,946,049
Primary Government
Business-Type
Activities
1 ,530,632
100,705
162,714
2 06,910
4,343,651
32,517
1,749,349
8,126,478
323,149
27,249,528
2,886,673
2 ,781,798
3 3,241,148
41,367,626
2,151,247
744,454
2,895,701
22,811,740
38,301,022
$ 61,112,762
Total
7,010,470
1,165,113
1 ,032,385
2 52,208
9,238,805
5,697,495
1,873
483,165
3,845,757
3,754,372
32,481,643
4,801,553
9,231,639
36,127,052
60,883,044
30,204,511
141,247,799
173,729,442
758,674
42,723,306
8,083,213
51,565,193
261,913,521
13,760,738
2 561 903
3 79,187
28,319,789
58,800
4,231,379
49,311,796
(43,166,506)
$ 268,058,811
See accompanying Notes to the Basic Financial Statements. 50 20 672
City of South Gate
Statement of Activities
For the Year Ended June 30, 2022
Functions/Programs
Primary government:

Governmental activities:

General government
Police
Community development
Parks & recreation
Public works
Interest on long-term debt
Total governmental activities
Expenses
$ 7,578,443
34,486,871
11,374,303
8,774,974
19,188,975
649,620
82,053,186
Business-type activities:

Water 15,070,542
Sewer 1,751,215
Refuse 4,324,468
Total business-type activities 21,146,225
Total primary government $ 103,199,411
Charges for
Services
$ 1,965,422
1 ,606,675
2 ,001,775
1,160,196
1,703,156
8,437,224
19,564,619
1,272,304
4,347,262
25,184,185
$33,621,409
Program Revenues
Operating
Grants and
Contributions
Capital
Grants and
Contributions
Total
Program
Revenues
$ 1,247,201 $
9,360,512
7,062,936
16,107,088 10,387,141
33,777,737 10,387,141
137,101
137,101
$ 33,914,838 $10,387,141
$ 3,212,623
10,967,187
9,064,711
1 ,160,196
2 8,197,385
52,602,102
19,564,619
1,272,304
4,484,363
25,321,286
$ 77,923,388
See accompanying Notes to the Basic Financial Statements. 51 21 673
City of South Gate
Statement of Activities (Continued)
For the Year Ended June 30, 2022
Functions/Programs
Primary government:

Governmental activities:

General government
Police
Community development
Parks & recreation
Public works
Interest on long-term debt
Total governmental activities
Business-type activities:

Water
Sewer
Refuse
Total business-type activities
Total primary government
General revenues
Taxes :

Property taxes, levied for general purpose
Transient occupancy taxes
Sales taxes
Franchise taxes
Business licenses taxes
Motor vehicle license in lieu
Other taxes
Total taxes
Use of money and property (loss)
Other
Transfers
Total general revenues and transfers
Changes in net position
Net Position:

Beginning of year, as restated (note 17)
End of year
Net (Expense) Revenue
and Changes in Net Position
Primary Government
Governmental
Activities
Business-Type
Activities
$ (4,365,820) $
(23,519,684)
(2,309,592)
(7,614,778)
9,008,410
(649,620)
(29,451,084)
(29,451,084)
4,494,077
(478,911)
159,895
4,175,061
4,175,061
15,462,214
556,972
27,689,344
2,846,921
1,568,305
111,543
646,862
48,882,161
(2,243,040)
858,214
(21,986,316)
25,511,019
(1,324,133)
21,986,316
20,662,183
(3,940i065) 24,837,244
210,886,114
$ 206,946,049
36,275,518
$ 61,112,762
Total
$ (4,365,820)
(23,519,684)
(2,309,592)
(7,614,778)
9,008,410
(649,620)
(29,451,084)
4,494,077
(478,911)
159,895
4,175,061
(25,276,023)
15,462,214
556,972
27,689,344
2,846,921
1,568,305
111,543
646,862
48,882,161
(3,567,173)
858,214
46 173 202
20,897,179
247,161,632
$ 268,058,811
See accompanying Notes to the Basic Financial Statements. 52 22 674
This page intentionally left blank.
53 23
675

FUND FINANCIAL STATEMENTS
54 24 676
This page intentionally left blank.
55 25 677

GOVERNMENTAL FUND

FINANCIAL ST ATEMENTS
General Fund - The General Fund accounts for resources traditionally associated with government which are not legally required, or determined by sound financial management, to be accounted for in another fund.

Grants Special Revenue Fund - This fund is used to account for all Federal, State, and local grants not specified in other funds.

American Rescue Plan Act (ARPA) - This fund is account for expenditures related to the funds received through this source by the U.S Treasury. These funds must be used for specific purposes outlined in the Act and promulgated by regulations issued by the U.S Treasury. Funds must be spent by December 31, 2024 or legally obligated. In no case shall be funds be allow to be expended beyond December 31, 2026.

All revenue and expenditure elements caused or impacted by the Coronavirus Disease 2019 (COVID-19) pandemic since January 2020 through December 2024 are generally covered by the ARPA.

Capital Improvement Projects Fund - This fund accounts for various capital projects funded by grants, other governmental entities or designated by the City Council. 56 26 678
ASSETS
General
Fund
City of South Gate
Balance Sheet
Governmental Funds
June 30, 2022
Grants Special
Revenue Fund
American
Recuse Plan
Act Fund
Capital
Improvement
Projects Fund
Nonmajor
Govern mental
Funds
Total
Governmental
Funds
Cash and investments
Restricted cash and investments
held by fiscal agent
Receivables:

Accounts
Notes and loans
Accrued interest
Lease
Prepaid items
Due from other governments
Due from other funds
Inventories
Land held for resale
Advances to other funds
Total assets
$17,930,684 $ $ 7,77;2,917 $ 8,547,674 $ 32,911,446 $ 67,162,721 450,082
1 ,467,570
17,433
2 9,136
777,328
22,025
6,558,776
14,326,327
223,736
342,680
14,691,232
17,329
2,000
15,000
4,290
1,813,(100
$43,616,097 $15,033,912 $7,79C),246 $ 8,568,964
166,986
8,406,456
47,354
4,958
35,006
1,179,894
1,416,731
4,950,000
$ 49,118,831
452,082
1,649,556
8 ,766,569
9 3,819
782,286
57,031
22,429,902
15,747,348
223,736
4,950,000
1,813,000
$124,128 050

LIABILITIES, DEFERRED INFLOWS

OF RESOURCES AND FUND BALANCES
Liabilities:

Accounts payable
Accrued liabilities
Unearned revenue
Deposits
Retentions payable
Due to other governments
Due to other funds
Advances from other funds
Total liabilities
Deferred inflows of resources:

Lease related
Unavailable revenues
$ 1,109,553
932,443
933,933
1,873
329,590
3,307,392
1,110,378
396,857
12,247,715
13,754,950
753,839
151,014 4,691,542
Total deferred inflows
of resources ,904853 4,691,542
$ 359,939 $ 2,460,418 $
7 ,348,915 259,353
8 69,671
935,196
101,925
520,159
23,054
7,708,854 3,589,442
3,211,441
1,813,000
6,604,775
4,835
63,571
68,406
$ 4,865,106
1,034,368
9,238,805
1,353,844
869,671
1,873
15,788,746
1,813,000
34,965,413
758,674
4,906,127
5,664,801
Fund Balances:

Nonspendable:

Inventories 223,736
Prepaiditems 22,025
Notes and loans ' 17,433
Advances to other funds 1,813,000
Restricted :

Community development projects
Asset fofeiture program
Law enforcement
Public works
Capital projects 56,800
Debtservice 393,282
Low/mod income housing
Committed :

Emergency reserve 2,000,000
Employment resource center
Budget stabilization 6,000,000
OPEB section 115 trust 1,000,000
Assigned:

Publicworks 115,000
Capital projects 3,367,023
Unassigned (deficit) 24,395,553
Total fund balances 39,403,852
Total liabilities, deferred
inflows of resources
and fund balances $43,616,097
342,680
(3,7 55,260)
(3,412,580)
2,000
3,507,085
35,006
13,383,052
2 ,561,903
3 79, 187
23,524,190
4,231,379
1,470,437
81,392
81,392 4,979,522
(1,669,067)
42,445,650
223,736
57,031
17,433
1,813,000
13,725,732
2 ,561,903
3 79,187
23,524,190
58,800
393,282
4,231,379
2 ,000,000
3,507,085
6,000,CX)0
1,000,000
115,ODD
4,837,460
19,052,618
83,497,836
$15,033,912 $ 7,790,246 $ 8,568,964 $ 49,118,831 $124,128 050 See accompanying Notes to the Basic Financial Statements. 57 27
679
City of South Gate
Reconciliation of the Governmental Funds Balance Sheet to the Government-Wide Statement of Net Position
June 30, 2022
Total Fund Balances - Total Governmental Funds $ 83,497,836 Amounts reported for governmental activities in the Statement of Net Position were different because:

Capital assets used in governmental activities were not financial resources and therefore were not reported in governmental funds.

Government-Wide Financial Statements
Less: capital assets reported in Internal Service Funds Total capital assets adjustment
Long-term debt are not due and payable in the current period and, therefore, are not reported in the governmental fund activity:

Pension Obligation Bonds
Notes payable
Leases payable
Compensated absences, net of $(87,498) reported in Internal Service Funds Total long-term debt adjustment
Accrued interest payable for the current portion of interest due on Bonds has not been reported in the governmental funds.

Governmental funds report all pension contributions as expenditures; however, in the statement of net position, the excess of the total pension liability over the plan fiduciary net position is reported as a net pension liability:

Deferred outflows of resources related to pensions, net of $301,754 reported in Internal Service Funds Aggregate net pension liabilities, net of $(1,112,550) reported in Internal Service Funds.

Deferred inflows of resources related to pensions, net of $(829,110) reported in Internal Service Funds Governmental funds report all OPEB contributions as expenditures; however, in the statement of net position, total OPEB liability is reported as a total OPEB liability:

Deferred outflows of resources related to OPEB, net of $188,661 reported in Internal Service Funds.

Other postemployment benefits liabilities, net of $(974,188) reported in Internal Service Funds.

Deferred inflows of resources related to OPEB, net of $(260,709) reported in Internal Service Funds.

Revenues reported as unavailable revenue in the governmental funds and recognized in the statement of activities. These are included in the intergovernmental revenues in the governmental Internal service funds were used by management to charge the costs of certain activities to individual funds. The assets and liabilities of the internal service funds were included in governmental activities in the Government-Wide Statement of Net Position.

Net Position of Governmental Activities
239,899,328
(3,353,900)
236,545,428
(9,680,349)
(673,019)
(124,528)
(4,841,554)
(15,319,450)
(45,298)
18,126,057
(56,883,821)
(39,742,949)
5,121,996
(26,448,525)
(7,078,050)
4,906,127
4,266,698
$ 206,946,049
See accompanying Notes to the Basic Financial Statements. 58 28 680
City of South Gate
Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds
For the Year Ended June 30, 2022
REVENUES:

Taxes
Licenses and permits
Intergovernmental
Charges for services
Use of money and property (loss)
Fines and forfeitures
Rental
Miscellaneous
Total revenues
EXPENDITURES:

Current:

General government
Police
Community development
Parks & recreation
Public works
Capital outlay
Debt service :

Principal
Interest and fiscal charges
Total expenditures
REVENtJES OVER
(UNDER) EXPENDITURES
OTHER FINANCING SOURCES (tlSES):

Proceeds from leases
Transfers in
Transfers out
Total other financing sources (uses)

CHANGES IN FUND BALANCES
FUND BALANCES:

Beginning of year, as restated (note 17)
End of year
General
Fund
Ma jor Funds
Grants Special
Revenue Fund
American
Resuce Plan
Fund
Capital
Improvement
Projects Fund
Nonmajor
Governmenta
Funds
$ 48,770,618 $
1 ,623,236 -
216,631 10,387,142
2,342,111 -
(783,785)
1,310,097
129,788
4,120,074
9,929,322
66,103
57,728,77C1 10,387,142 9,995,425
$ 2,001,775
42,493
20,794,143
1,117,510
(793,188)
8,788
23,171,521
7,142,469
30,040,630
3,293,625
8,676,195
4,343,329
64,008
1,411,339
624,408
55,596,003
1,142,113
17,038,461
20,594
1,176,453
8,757,412
101,005
7,679,504
442,541
1,142,113 17,038,461
280,294
8,229
18,466,032
2,132,767 10,387,142 8,853,312 (17,038,461) 4,705,489
8,787,075
(31,880,830)
(23,093,755)
(20,960,988)
(12,540,722)
(12,540,722)
(2,153,580)
(8,787,210)
(8,787,210)
66,102
18,313,205
(8,000)
18,305,205
1,266,744
30,306
1,355,045
(4,241,627)
(2,856,276)
1,849,213
60,364,840
$ 39,403,852
(1,259,000)
$ (3,412,580) 4
15,290
81,392
3,712,778
$ 4,979,522
<o,sgs,znz
$ 42,445,650
Total
Governmenta
Funds
$ 50,772,393
1,665,729
41,327,238
3,459,621
(1,510,870)
1,310,097
129,788
4,128,862
101,282,858
8,305,176
31,217,083
12,051,037
8,777,200
12,022,833
17,545,010
1,691,633
632,637
92,242,609
g,o<o,z"ig
30,306
28,455,325
(57,458,389)
(28,972,758)
(19,932,509)
103,430,345
$ 83,497,836
See accompanying Notes to the Basic Financial Statements. 59 zg 681
City of South Gate
Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Government-Wide Statement of Activities For the Year Ended June 30, 2022
Net Change in Fund Balances - Total Governmental Funds $ (19,932,509) Amounts reported for governmental activities in the Statement of Activities were different because:

Governmental funds report capital outlays as expenditures. However, in the statement of activities, the costs of those assets is allocated over their estimated useful lives as depreciation expense. This is the amount by which capital outlays exceeded depreciation in the current period.

Capital outlay, net of $401,749 reported in Internal Service Fund Depreciation, net of $424,938 reported in Internal Service Fund Repayment of long-term liabilities was an expenditures in governmental funds, but the repayment reduced long-term liabilities in the Government-Wide Statement of Net Position.

Principal paid on long-term debt, net of $391,171 reported in Internal Service Fund Proceeds from leases
16,815,458
(9,350,296)
7,465,162
1,691,633
(30,306)
Accrued interest for long-term liabilities. This is the net change in accrued interest for the current period. 9,219
Compensated absences expenses reported in the statement of activities do not require the use of current financial resources: therefore, are not reported as expenditures in governmental funds. 705,805
Pension expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds. 1,004,246
Other postemployment benefits expenses reported in the statement of activities do not require the use of current financial resources; therefore, are not reported as expenditures in the governmental funds. (252,742)
Revenues reported as unavailable revenue in the governmental funds and recognized in the statement of activities. These are not included in the intergovernmental revenues in the governmental fund activity. 2,949,185
Internal service funds are used by management to charge the costs of certain activities, such as fleet management and self-insurance, to individual funds. The net revenues (expenses) of the internal service funds is reported with governmental activities.

Change in Net Position of Governmental Activities
2,450,242
$ (3,940,065)
See accompanying Notes to the Basic Financial Statements. 30 60
682

PROPRIET ARY FUND

FINANCIAL STATEMENTS
ENTERPRISE FUNDS:

Utility Authority - Water Fund - This fund accounts for the operations of the City's water utility. AI[ activities necessary to provide this service are accounted for in this fund including administration, operations, maintenance, capital improvements, billing, collections and depreciation.

Utility Authority - Sewer Fund - This fund accounts for the provision of sewer maintenance services to the residents of the City. All activities necessary to provide this service are accounted for in this fund including, but not limited to, administration, operations, maintenance, capital improvements, billing, collections and depreciation.

Refuse Fund (Non-Major) - This fund accounts for the provision of waste management services to the residents of the City. All activities necessary to provide this service are accounted for in this fund including, but not limited to, administration, operations, maintenance, capital improvements, billing, collections and depreciation.

INTERNAL SERVICE FUNDS: (Refer to page 164 for more details) 61 683
This page intentionally left blank.
62 32 684
ASSETS
Current assets:

Cash and investments
Receivables:

Accounts
Accrued interest
Due from other funds
Total current assets
Noncurrent assets:

Restricted assets:

Cash and investments
Capital assets:

Non-depreciable assets
Depreciable assets, net of accumulated depreciation Total capital assets, net
Total noncurrent assets
Total assets

DEFERRED OUTFLOWS OF RESOURCES
Deferred charge on refunding of debt
Deferred outflows of resources related to pensions
Deferred outflows of resources related to OPEB
Total deferred outflows of resources
City of South Gate
Statement of Net Position
Proprietary Funds
June 30, 2022
Business-type Activities
Enterprise Funds
Major Nonmajor
Water Sewer Refuse Total
Governmenta
Activities
Internal
Service Funds
$ 45,073,843 $ 1,736,255 $ 919,461 $ 47,729,559 $ 17,748,651 3,270,555
62,278
1,023
4 8,407,699
859,294
3,377,991
31,343,775
34 ,721,766
35 ,581,060
83,988,759
1 ,006,148
676,299
482,213
2,164,660
436,265
2,930
739,909
1,286
2,175,450 1,660,656
4,446,729
66,494
1,023
5 2,243,805
15,194,001
15,194,001
15,194,001
17,369,451
106,647
56,508
163,155
859,294
29,408
29,408
29,408
1,690,064
3,407,399
4 6,537,776
49 ,945,175
50 ,804,469
103,048,274
1 ,006,148
782,946
538,721
2,327,815
1 ,389
2 2,842
40,375
17,813,257
3,353,900
3,353,900
3,353,900
21,167,157
301,754
188,661
490,415
See accompanying Notes to the Basic Financial Statements. 63 33 685
City of South Gate
Statement of Net Position (Continued)
Proprietary Funds
June 30, 2022
Busmess-type Activities
Enterprise Funds
Major Nonmajor
Water Sewer Refuse

LIABILITIES
Liabilities:

Current liabilities:

Accounts payable
Accrued liabilities
Accrued interest
Deposits payable
Retentions payable
Compensated absences, due within one year
Claims and judgments, due within one year
Bonds payable, due within one year
Total current liabilities
Noncurrent liabilities:

Compensated absences, due in more than one year
Claims and judgments, due in more than one year
Bonds payable, due in more than one year
Aggregate net pension liability
Net OPEB liability
Total noncurrent liabilities
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Deferred inflows of resources related to pensions
Deferred inflows of resources related to OPEB
Total deferred inflows of resources

NET POSITION
Net investment in capital assets
Restricted for debt service
Unrestricted (deficit)
Total net position
1 ,271,185
87,905
2 06,910
4,343,651
162,714
28,799
236162
6,337,326
286,196
24,847,867
2,493,471
2,490,008
3 0,117,542
36,454,868
1 ,858,220
666,366
2,524,586
11,503,179
859,294
34,811,492
$ 47,173,965
67,281
10,448
3,435
1,513,187
1,594,351
34,138
2,401,661
3 93,202
291,790
3,120,791
4,715,142
293,027
78,088
371,115
11,279,153
1,167,196
$12,446,349
192,166
2,352
194,801
2,815
2,815
197,616
29,408
1,463,040
$ 1,492,448
Total
1 ,530,632
100,705
2 06,910
4,343,651
162,714
32,517
1,749,349
8,126,478
323 149
27,249,528
2,886,673
2,781,798
3 3,241,148
41,367,626
2,151,247
744,454
2,895,701
22,811,7 40
859,294
37,441,728
$ 61,112,762
Governmental
Activities
Internal
Service Funds
614,732
30,040
8,000
3,845,757
4,498,529
79,498
9,231,639
1,112,550
974,188
11,397,875
15,896,404
829,110
260,709
1,089,819
2,949,249
1,317,449
$ 4,266,698
See accompanying Notes to the Basic Financial Statements. 64 34 686
City of South Gate
Statement of Revenues, Expenses, and Changes in Net Position Proprietary Funds
For the Year Ended June 30, 2022
OPERATING REVENUES:

Sales and service charges
Interdepartmental charges
Miscellaneous
Total operating revenues
OPERATING EXPENSES:

Personnel services
Utilities
Contractual services
Administrative services
Repairs and maintenance
Supplies
Insurance
Claims expense
Depreciation expense
Total operating expenses

OPERATING INCOME (LOSS)
NONOPERATING REVENUES (EXPENSES):

Investment income (loss)
Intergovernmental revenue
Interest expense and fiscal charges
Total nonoperating revenues (expenses)

INCOME (LOSS) BEFORE TRANSFERS
TRANSFERS:

Transfers in
Transfers out
Total transfers

CHANGES IN NET POSITION
NET POSITION :

Beginning of year, as restated (note 17)
End of year
Business-type Activities
Enterprise Funds
Major Nonmajor
Water Sewer Refuse Total
Governmental
Activities
Internal
Service Funds
$ 19,162,483 $ 1,271,082 $ 4,341,457 $24,775,022 $
7,702,537
402,136
19,564,619
2,977,895
789,240
4,750,722
3,119,584
113,550
283,464
2,283,986
14,318,441
5,246,178
(1,239,508)
(752,101)
(1,991,609)
3,254,569
7,680
(4,700)
2,980
3,257,549
1,222
1,272,304
424,100
1,667
159,189
278,945
226,893
18,915
534,694
1,644,403
(372,099)
(57,939)
(106,812)
(164,751)
(536,850)
21,985,136
(1,800)
21,983,336
21 446 486
5,805
4,347,262
74,267
3,960,076
159,148
130,977
4,324,468
22,794
(26,686)
137,101
110,415
133,20C1
133,209
409 163
25 184 185 7,702,537
3 ,476,262
4 ,750,983
5 ,069,059
3,529,506
340,443
302,379
2,818,680
20,287,312
1 ,300,776
6,205
2 77,612
492,467
596,863
832,251
4,285,849
3 ,585,914
4 24,938
11,802,875
4,896,873 (4,100,338)
(1,324,133)
137,101
(858,913)
(2,045,945)
2,850,928
(439,966)
(26,202)
(466,168)
(4,566,506)
21,992,816
(6,500)
21,986,316
24,837,244
7,243,566
(226,818)
7,016,748
2,450,242
43,916,416
$ 47,173,965
(9,000,137)
$12,446,349
1,359,239
$ 1,492,448
36,275,518
$ 61,112,762
1,816,456
$ 4,266,698
See accompanying Notes to the Basic Financial Statements. 35 65
687
City of South Gate
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2022
Business-type Activities
Enterprise Funds
Major Nonmajor
Water Sewer Refuse Total
Governmental
Activities
Internal
Service Funds
CASH FLOWS FROM OPERATING ACnVITIES:

Cash received from customers and users
Cash received from interFund service provided
Cash paid to suppliers for goods and services
Cash paid to employees for services
Net cash provided by (used in) operating activities

CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:

Acquisition and construction of capital assets
Principal paid for capital-related debt
Interest paid on capital-related debt
Net cash (used in) capital and
related financing activities

CASH FLOWS FROM NONCAPITAL FINANCING
ACTIVITIES:

Intergovernmental revenue
Cash received from other funds
Cash paid to other funds
Net cash provided by (used in)
noncapital financing activities
CASH FLOWS FROM INVESTING ACTMTIES:

Investment income (loss)
Net cash provided by (used in) investing activities Net change in cash and cash equivalents
CASH AND CASH EQUIVALENTS:

Beginning of year
End of year

RECONCILIATION TO STATEMENT OF
NET POSITION:

Cash and investments
Restricted cash and investment
Total cash and cash equivalents
$ 19,983,453 $ 1,254,598 $ 4,320,173 $ 25,558,224 $ 7,778,171
(6,996,127) (445,234) (4,335,225) (11,776,586) (7,388,648) (6,518,854) (782,788) (204,985) (7,506,627) (1,508,731) 6,468,472 26,576 (220,037) 6,275,011 (1,119,208)
(2,372,659)
(1,413,560)
(753,7 43)
143,892
(231,440)
(106,812)
(29,408) (2,258,175)
(1,645,000)
(860,555)
(275,513)
(391,761)
(26,202)
(4,539,962) (194,360) (29,408) (4,763,730) (693,476) 7,680
(4,700)
2,980
(1,255,all)
(1,255,011)
(1,662)
137,101 137,101
7,680
(6,362)
7,243,566
(226,818)
(1,662) 137,101 138,419 7,016,748
(58,779)
(58,779)
(26,692)
(26,692)
(1,340,482)
(1,340,482)
(449,860)
(449,860)
676,479 (228,225) (139,036) 309,218 4,754,204
45,256,658
$ 45,933,137
1,964,480
$ 1,736,255
1,058,497 48,279,635
$ 919,461 $ 48,588,853
12,994,447
$ 17,748,651
$ 45,073,843 $ 1,736,255 $ 919,461 $ 47,729,559 $ 17,748,651 859,294 - 859,294
$ 45,933,137 $ 1,736,255 $ 919,461 $ 48,588,853 $ 17,748,651 See accompanying Notes to the Basic Financial Statements. 66 36 688
City of South Gate
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2022
Business-type Activities
Enterprise Funds
Major Nonmajor
Water Sewer Refuse Tota
Governmental
Activities
Interna
Service Funds

RECONCILIATION OF OPERATING INCOME
(LOSS) TO NET CASH PROVIDED BY (USED IN)
OPERATING ACTMTIES:

Operatingincome(loss) $
Adjustments to reconcile operating income (loss) to net cash provided by (used in) operating activities:

Depreciation
(Increase) decrease in accounts receivable
(Increase) decrease in due from other funds
(Increase) decrease in deferred outflows of
resources related to pensions
(Increase) decrease in deferred outflows of
resources related to other postemployment benefits
Increase decrease in accounts payable
Increase decrease in accrued liabilities
Increase decrease in deposits payable
Increase decrease in claims and judgments
Increase decrease in compensated absences
Increase decrease in net pension liability
Increase decrease in net OPEB liability
Increase decrease in deferred inflows of
resources related to pensions
Increase (decrease) in deferred inflows of
resources related to other postemployment benefits
Total adjustments
Net cash provided by (used in) operating activities 5,246J78 $ (372,099) $ 22,794 $ 4,896,873 $ (4,100,338) 2,283,986
39,913
5,817
534,694
(17,706)
(376,992) 4,439
231,724
(1,091,747)
26,779
378,921
(21,434)
(38,371)
(igg)
1,629
(2,360,774)
144,402
(18,602)
(362,105)
16,921
1,309,042 287,305
629,594
1,222,294
6,468,472
13,733
398,675
$ 26,576
(27,089)
(217,424)
1,423
(242,831)
$ (220,037)
2,818,680
(4,882)
5,817
(372,553)
210,290
(1,347,542)
28,003
378,921
(16,714)
(2,722,879)
161,323
1,596,347
643,327
1,378,138
$ 6,275,011
424,938
(1,389)
77,022
(37,405)
(71,561)
35,409
8,750
2,306,068
6,303
(684,844)
56,495
815 495
45,849
2,981,130
$ (1,119,208)
See accompanying Notes to the Basic Financial Statements. 67 37 689

FIDUCIARY FUND

FINANCIAL STATEMENTS
Custodial Funds - These funds are used to report fiduciary activities that are not required to be reported in pension (and other employee benefit) trust funds, investment trust funds, or private purpose trust funds.

Successor Agency to the Community Development Commission Private Purpose Trust Fund This fund accounts for the assets and liabilities of the former Community Development Commission and the allocated revenue to pay estimated installment payments of enforceable obligations until the obligations of the former Community Development Commission (Redevelopment Agency) are paid in full and assets have been liquidated.
690
This page intentionally left blank.
69 39 691
City of South Gate
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2022
ASSETS
Cash and investments
Cash and investments with fiscal agent
Account receivables
Notes receivables and loans receivable
Due from other governments
Prepaid bond insurance
Property held for resale
Capital assets:

Non-depreciable
Depreciable, net
Total assets

LIABILITIES
Accounts payable
Interest payable
Due to other governments
Long-term debt:

Due within one year
Due in more than one year
Total liabilities

NET POSITION (DEFICIT)
Held for:

Individuals, organizations, and other governments
Custodial
Funds
Successor
Agency of the
Former
Community
Development
Commission
$ 982,410
163
42 $ 1,267,730
4,102,186
27,199
153,656
1,873
47,349
1,463,492
982,615
1,686,000
84,315
8,833,800
828 162,442
190,598
448,891
828
3,809,649
9,074,441
13,686,021
$ 981,787 $ (4,852,221)
See accompanying Notes to the Basic Financial Statements. 70 40 692
City of South Gate
Statement of Changes in Fiduciary Net Position
Ftduciary Funds
For the Year Ended June 30, 2022
ADDITIONS:

Redevelopment property tax trust fund
Membership assessment
Use of money and property (loss)
Total additions
DEDUCTIONS:

Operational expense
Contractual services
Administrative services
Depreciation expense
Interest expense and fiscal charges
Total deductions
Changes in Net Position
NET POSITION :

Beginning of year
End oT year
Custodial
Funds
Successor
Agency of the
Former
Community
Development
Commission
$ 4,995,250
131,026
(740)
130,286
39,994
5,035,244
119,622
119,622
510,087
261,847
19,089
285,234
1,076,257
10,664 3,958,987
971,123
$ 981,787
(8,811,208)
$ (4,852,2211
See accompanying Notes to the Basic Financial Statements. 71 41
693

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Siqnificant Accountinq Policies
The basic financial statements of the City have been prepared in conformity with Generally Accepted Accounting Principles (GAAP) as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The more significant of the Authority's accounting policies are described below.

A, Description of the Reporting Entity
The City of South Gate (the 'City") was incorporated January 20, 1923, under the general laws of the state of California and enjoys all the rights and privileges pertaining to such "General Law" cities. The City is a municipal corporation governed by an elected five- member council.

As required by generally accepted accounting principles, these basic financial statements present the City and its component units, entities for which the City is considered to be financially accountable. The following blended component units, although legally separate entities are, in substance, part of the City's operations and data from these units are combined with the data of the City. They are reported as blended for the following reasons:
(1) the governing board is substantively the same as the primary government and there is a financial benefit or burden relationship between the primary government and the component unit; (2) the component unit provides services entirely, or almost entirely, to the primary government or otherwise exclusively, or almost exclusively, benefits the primary government even though it does not provide services directly to it; and (3) the component unit's total debt outstanding, including leases, is expected to be repaid entirely or almost entirely with the resources of the primary government. A brief description of each component unit is discussed below.

Blended Component Units
Blended component units, although legally separate entities, are, in substance part of the government's operation and so data from these units are combined with data of the primary government. Discretely presents component units, on the other hand, are reported in a separate column in the combined financial statements to emphasize that they are legally separate from the government.

The City Council acts as the governing body and is able to impose its will on the following organizations and establishing financial accountability. The City is considered to be financially accountable for an organization if the City appoints a voting majority of that organization's governing body and the City is either able to impose its will on that organization, or there is a potential for that organization to provide specific financial benefits to or impose specific financial burdens on the City. The City is also considered to be financially accountable if an organization is fiscally dependent upon the City (i.e., it is unable to adopt its budget, levy taxes, set rates or charges, or issue bonded debt without approval from the City). As a result, these organizations are considered component units of the City and are included within the financial statements of the City using the blended method. All component units have a June 30 year-end.
72 42 694

CITY OF SOUTH GATE
Notes to the Basac Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Siqnificant Accountinq Policies (Continued) The South Gate Utility Authority ("Utility Authority") is a joint powers authority that was established by the City and Authority on August 28, 2001. The Utility Authority is governed by a board of five members comprised of the same individuals who comprise the City Council of the City. The Utility Authority was created for the purpose of providing financing for public capital improvements for the City. Separate financial statements are not prepared for the Utility Authority.

The Housing Authority of the City of South Gate ("Housing Authority) was established on September 23, 1974, pursuant to the State of California Health and Safety Code 34200 entitled, "Housing Authorities Law." The Housing Authority is governed by a board of five members comprised of the same individuals who comprise the City Council of the City. The purpose of the Housing Authority of the City of South Gate is to provide safe and sanitary dwelling accommodations in the City to persons of low income. Separate financial statements are not prepared for the Housing Authority.

The South Gate Public Financing Authority ("Financing Authority") was formed on September 11, 1989. The purpose of the South Gate Public Financing Authority is to issue debt to finance public improvements and other capital purchases for the City. The Public Financing Authority is governed by a board of five members comprised of the same individuals who comprise the City Council of the City. Separate financial statements are not available for the Financing Authority.

The following specific criteria were used in determining the status of these component units:
* Members of the City Council also act as the governing body of the Utility Authority, the Housing Authority, and the Financing Authority.

The City, the Utility Authority, the Housing Authority, and the Financing Authority are financially interdependent.

The Utility Authority, the Housing Authority, and the Financing Authority are managed by employees of the City, who provide various support functions including financial reporting and investment decisions.

B. Measurement Focus, 8asis of Accounting and Financial Statement Presentation The City's basic financial statements are prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The Government Accounting Standards Board is the acknowledged standard-setting body for establishing accounting and financial reporting standards followed by governmental entities in the United States of America.
73 43 695

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Siqnificant Accountinq Policies (Continued) Government- Wide Financial Statements
The Statement of Net Position and the Statement of Activities display information about the primary government. These statements include the financial activities of the overall City government, except for fiduciary activities.

Eliminations have been made to minimize the double counting of internal service fund and similar activities. The effect of inter-fund services provided and used between functions is not eliminated in the process of consolidation. These statements distinguish between the governmental and business-type activities of the City. Governmental activities generally are financed through taxes, intergovernmental revenues, and other no exchange transactions. Business-type activities are financed in whole or in part by fees charged to external parties.

The government-wide financial statements are reported using the "economic resources" measurement focus and the accrual basis of accounting. Accordingly, all of the City's assets and liabilities, including capital assets (as well as infrastructure assets) and long-term liabilities, are included in the accompanying Statement of Net Position. The Statement of Activities presents a comparison between direct expenses and program revenues for each segment of the business-type activities of the City and for each function of the City's governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Program revenues include (a) charges paid by the recipients of goods or services offered by the programs, (b) grants and contributions that are restricted to meeting the operational needs of a particular program and (c) fees, grants and contributions that are restricted to financing the acquisition or construction of capital assets. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. Certain indirect costs are included in program expenses reported for individual functions and activities.

Fund Financial Statements
Separate financial statements are provided
fiduciary funds, even though the latter are
statements. Major individual governmental
fund financial statements.

Governmental Fund Financial Statements
for governmental funds, proprietary funds and
excluded from the government-wide financial
funds are reported as separate columns in the
Governmental fund financial statements are reported using the "current financial resources" measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the government considers revenues to be available if they are collected within 60 days of the end of the current fiscal period, with the exception of grants, for which the revenue recognition period is 270 days.

Expenditures generally are recorded when a liability is incurred, as under accrual 74 44 696

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Siqnificant Accountinq Policies (Continued) accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due.

Sales taxes, property taxes, franchise taxes, gas taxes, motor vehicle in lieu, transient occupancy taxes, grants and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the government.

The City reports the following major governmental funds:

General Fund - The General Fund accounts for resources traditionally associated with government which are not legally required or by sound financial management to be accounted for in another fund.

American Rescue Plan Act Special Revenue Fund - This fund is account for expenditures related to the funds received through this source by the U.S Treasury. These funds must be used for specific purposes outlined in the Act and promulgated by regulations issued by the U.S Treasury. Funds must be spent by December 31, 2024 or legally obligated. In no case shall be funds be allow to be expended beyond December 31, 2026. All revenue and expenditure elements caused or impacted by the Coronavirus Disease 2019 (COVID-19) pandemic since January 2020 through December 2024 are generally covered by the ARPA.

Grants Special Revenue Fund - This fund is used to account for all Federal, State, and local grants not specified in other funds.

Capital Improvement Projects Fund - This fund accounts for various capital projects from resources committed by the City Council.

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

A separate column representing internal service funds is also presented in these statements. However, internal service balances and activities have been combined with the governmental activities in the Government-Wide Financial Statements. These funds have been established to finance and account for goods and services provided by one City department to other City departments or agencies. These areas of service include Insurance, Information Systems, Fleet Management, Capital Asset & Equipment Replacement, and Building & Infrastructure Maintenance. 75 45 697

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Stqnificant Accountinq Policies (Continued) Proprietary funds are accounted for using the "economic resources" measurement focus and the accrual basis of accounting. Accordingly, all assets and liabilities (whether current or noncurrent) are included on the Statement of Net Position. The Statement of Revenues, Expenses, and Changes in Net Position present 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.

Proprietary fund operating revenues and expenses, such as charges for services, and payments to employees and vendors, result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up essentially equal values. Non-operating revenues and expenses, such as subsidies, investment earnings, changes in fair value of investments and interest charges result from non-exchange transactions or ancillary activities.

The concept of major funds extends to Proprietary Funds. The City has identified the funds below as major proprietary funds. Individual non-major funds may be found in the supplemental section.

Utility Authority - Water Fund - This fund accounts for the operations of the City's water utility. All activities necessary to provide this service are accounted for in this fund including administration, operations, maintenance, capital improvements, billing, collection and depreciation.

Utility Authority - Sewer Fund - This fund accounts for the provision of sewer maintenance services to the residents of the City. All activities necessary to provide this service are accounted for in this fund including, but not limited to, operations, maintenance, capital improvements and depreciation.

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 and private purpose trust funds. Both custodial funds and the private purpose trust funds are accounted for on the full accrual basis of accounting.

The City also reports the following fiduciary funds:

Custodial Funds - These funds account for resources held by the City in custodian capacity. Cash and deposits are maintained for activities associated with various associations and third-party projects. The City is responsible for ensuring that the assets reported in these funds are used for their intended purposes. 76 46 698

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Siqnificant Accountinq Policies (Continued) Private-purpose Trust Fund - This fund accounts for the assets and liabilities of the former Community Development Commission and the allocated revenue to pay estimated installment payments of enforceable obligations until the obligations of the former redevelopment agency are paid in full and assets have been liquidated.

C. Cash Investments and Cash Equivalents
In order to maximize investment return, the City pools its available cash for investment purposes. The City's cash management pool is used essentially as a demand deposit account by the various funds. The City has defined, for purposes of the preparation of its statements of cash flows, cash and cash equivalents as demand deposits plus all investments maintained in its cash management pool, regardless of maturity period.

Investments are reported in the accompanying balance sheet at fair value, except for certain certificates of deposit and investment contracts that are reported at cost. Changes in fair value that occur during a fiscal year are recognized as investment income reported for that fiscal year. Investment income includes interest earnings, changes in fair value, and any gains or losses realized upon the liquidation, maturity, or sale of investments.

The City pools cash and investments of all funds, except for assets held by fiscal agents.

Each fund's share in this pool is displayed in the accompanying financial statements as cash and investments. Investment income earned by the pooled investments is allocated to the various funds based on each fund's average cash and investment balance, except investment income for the Internal Service Funds and the Capital Improvement Fund which is allocated to the General Fund.

Following areas of certain disclosure requirements, if applicable, for Deposits and Investment Risks are presented in the footnotes:

Interest Rate Risk
Credit Risk
Overall
Custodial Credit Risk
Concentration of Credit Risk
Foreign Currency Risk
In addition, other disclosures are specified including use of certain methods to present deposits and investments, highly sensitive investments, credit quality at year-end and other disclosures.
o. pair Va/ue Measurement
u.s. GAAP defines fair value, establishes a framework for measuring fair value and establishes disclosure about 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. 77 47 699

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Siqnificant Accountinq Policies (Continued) The three levels of the fair value measurement hierarchy are described below:

Level 1- Inputs are unadjusted, quoted prices for identical assets and 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 and 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 and liabilities at the measurement date.

E. Receivables and Payables
Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either "due to / from other funds" (i.e., the current portion of interfund loans) or "advances to / from other funds" (i.e., the non-current portion of interfund loans). All other outstanding balances between funds are reported as "due to / from other funds." Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as "internal balances."
All trade and property tax receivables are shown net of an allowance for uncollectible.

Property tax revenue is recognized in the fiscal year for which the taxes have been levied providing they become available. Available means when 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 of the current period. The County of Los Angeles collects property taxes for the City. Tax liens attach annually as of 12:01 A.M. on the first day in January preceding the fiscal year for which the taxes are levied. Taxes are levied on both real and personal property as it exists on that date. The tax levy covers the fiscal period July 1 to June 30. All secured personal property taxes and one-half of the taxes on real property are due November 1 ; the second installment is due February 1. All taxes are delinquent, if unpaid, on December 10 and April 10, respectively. Unsecured personal property taxes become due on the first of March each year and are delinquent on August 31.

F. Prepaid Items
The prepaid items are payments made to vendors for costs applicable to future accounting periods and are recorded under the consumption method in both government-wide and fund financial statements.

G. Inventories
Inventories of supplies are recorded at cost, whereas inventories held for resale are recorded at lower of cost or market using the first-in, first-out (FIFO) method. The cost of inventory is recorded as an asset when purchased and is expensed when consumed. 78 48 700

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Siqnificant Account €nq Policies (Continued) H. Land Held for Resa/e
Land held for resale is recorded in the City's Housing Successor Special Revenue Fund, Housing Authority Development Projects Fund and in the Private-Purpose Trust Fund - Successor Agency of the Former Community Development Commission (CDC) at the lower of acquisition cost or estimated net realizable value when such amount becomes determinable as a result of the City entering into a contract for sale of property.

I. Capital Assets
Capital assets are recorded at cost where historical records are available and at an estimated historical cost where no historical records exist. Contributed capital assets are valued at their estimated acquisition value at the date o4: the contribution. Generally, capital asset purchases in excess of $5,000 are capitalized if they have an expected useful life of three years or more.

Capital assets, which include property, plant, equipment, infrastructure (e.g., roads, bridges, sidewalks and similar items) and intangible assets, are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. The City's infrastructure assets are recorded at historical cost or at estimated historical cost if actual historical cost was not available. All current year additions to infrastructure assets are depreciated.

Depreciation has been provided using the straight-line method over the estimated useful life of the asset in the government-wide financial statements and in the fund financial statements of the proprietary funds.

The following schedule summarizes capital asset useful lives:

Building and improvements
Equipment and furniture
Vehicles
Infrastructure
Wells
Pumping and purification equipment
Distribution and service equipment
it Eastside reservoir
Westside reservoir
Right to use lease assets
10-50 years
3-50 years
5-10 years
10-65 years
20 years
5-50 years
5-50 years
45 years
45 years
5-50 years
79 49 701

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Siqnificant Accountinq Policies (Continued) J. Deferred Outflows/Inflows of Resources
The Statement of Net Position and the Balance Sheet report separate sections for Deferred Outflows of Resources and Deferred Inflows of Resources, when applicable.

Deferred Outflows ofResources represent outflows of resources (consumption of net assets) that apply to future periods and that, therefore, will not be recognized as an expense until that time.

Deferred Inflows of Resources represent inflows of resources (acquisition of net assets) that apply to future periods and that, therefore, will not be recognized as revenue until that time.

K. Net Pension Liability
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Plan and additions to/deductions from the Plan's 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 currently due and payable in accordance with the benefit terms.

Investments are reported at fair value.

The following timeframes are used for pension reporting:

CalPERS
Valuation Date
Measurement Date
Measurement Period
June 30, 2020
June 30, 2021
July 1, 2020 to June 30, 2021
PARS
Valuation Date
Measurement Date
Measurement Period
June 30, 2020
June 30, 2021
July 1, 2020 to June 30, 2021
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. 80 50 702

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Siqnificant Accountinq Policies (Continued) L. Other Postemployment Benefits ("OPEB")
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the City's Retiree Benefits Plan ("OPEB Plan") and additions to/deductions from OPEB Plan's fiduciary net position have been determined on the same basis as they are reported by the Plan. For this purpose, the OPEB Plan recognizes benefit payments when due and payable in accordance with the benefit terms The following timeframes are used for OPEB reporting:

OPEB
Valuation Date
Measurement Date
Measurement Period
June 30, 2021
June 30, 2021
July 1, 2020 to June 30, 2021
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 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.

M. Compensated Absences
Employees can carry forward, for use in subsequent years, earned but unused vacation and sick leave benefits to a specific limit. Upon termination, the City is obligated to compensate employees for all accrued earned but unused vacation days. Upon termination, employees that have provided at least 15 years of service to the City are reimbursed for 50o/o to 75'/o of earned but unused sick leave benefits.

A liability is recorded for unused vacation and similar compensatory leave balances since the employees' entitlement to these balances are attributable to services already rendered and it is probable that virtually all of these balances will be liquidated by either paid time off or payments upon termination or retirement.

A liability is also recorded for unused sick leave balances for an estimated amount based on active employee's eligibility. The estimated amount is calculated based on accrued value of the sick leave balances at June 30, 2022, and the City of South Gate Memorandum of Understanding Sick Leave Payoff eligibility calculation. Other amounts of unused sick leave are excluded from the liability since their payment is contingent solely upon the occurrence of a future event which is outside the control of the City and the employee. 81 51 703

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Siqnificant Accountinq Policies (Continued) A liability is accrued for all leave benefits relating to the operations of the proprietary funds.

A current liability is accrued in the governmental funds for material leave benefits due on demand to governmental fund employees that have terminated prior to year-end. All other amounts are recorded in the statement of net position. These non-current amounts will be recorded as fund expenditures in the year in which they are paid or become due.

N. Long-Term Liabilities
In the government-wide financial statements and proprietary fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the governmental activities, business-type activities or proprietary fund type 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.

In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses.
0, Net Position
In the governmental-wide financial statements and proprietary fund financial statements, net position is classified as follows:

Net Investment in Capital Assets - This amount consists of capital assets net of accumulated depreciation and reduced by outstanding debt and any deferred outflows or inflows of resources that are attributed to the acquisition, construction, or improvement of the assets, net of unspent debt proceeds and deferred gain/loss on refunding and retention payable.

Restricted Net Position - This amount is restricted by external creditors, grantors, contributors, or laws or regulations of other governments.

Unrestricted Net Position - 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.

Sometimes the government will fund outlays for a particular purpose from both restricted (e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as restricted - net position and unrestricted - net position in the government-wide and proprietary fund financial statements, a flow assumption must be made about the order in which the resources are considered to be applied. It is the government's policy to consider restricted - net position to have been depleted before unrestricted - net position is applied.
82 52 704

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Siqnificant Accountinq Policies (Continued) P. Fund 8a/ance
In the fund financial statements, governmental funds report the following fund balance classification :

Nonspendable - This portion of a fund balance includes amounts that cannot be spent because they are either: (a) not in a spendable form, such as prepaid items, inventories of supplies, loans receivable, and land held for resale, unless the proceeds from the collection of those receivables or from sale of the properties is restricted, committed, or assigned; or (b) legally or contractually required to be maintained intact.

Restricted - This portion of a fund balance reflects constraints placed on the use of resources (other than non-spendable items) that are either: (a) externally imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments; or (b) imposed by law through constitutional provisions or enabling legislation.

Committed - This portion of a fund balance includes amounts that can only be used for specific purposes pursuant to constrains imposed by formal action of the government's highest level of decision-making authority (City Council), and remain binding unless removed in the same manner. The City Council, as the City's highest level of decision- making authority, may commit fund balance for specific purposes pursuant to constraints imposed by the adoption of a resolution. These committed amounts cannot be used for any other purpose unless the City Council removes or changes the specified use through the same type of formal action taken to establish the commitment. As part of the City's initiative to prepare for potential economic downturns or a major emergency, the City Council has committed funds as emergency reserves. As of June 30, 2022, the City has committed $2,000/000 in the emergency reserves. The commitments are made through council approval establishing and amending the reserve amounts.

Sometimes the government will fund outlays for a particular purpose from both restricted and unrestricted resources (the total of committed, assigned, and unassigned fund balance).

In order to calculate the amounts to report as restricted, committed, assigned, and unassigned fund balance in the governmental fund financial statements a flow assumption must be made about the order in which the resources are considered to be applied. The City considers restricted fund balance to have been spent first when expenditure is incurred for 83 53 705

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(1) Summary of Siqnificant Accountinq Policies (Continued) purposes for which both restricted and unrestricted fund balance is available. Similarly, when an expenditure is incurred for purposes for which amounts in any of the unrestricted classifications of fund balance could be used, the City considers committed amounts to be reduced first, followed by assigned amounts and then unassigned amounts.

Q. Use of Estimates
The preparation of 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.

R. Changes in Accounting Policy
During fiscal year ended June 30, 2022, the City implemented the following new GASB Pronouncement :

GASB Statement No. 87, Leases - The primary objective of this Statement is to meet the information needs of financial statement users by improving accounting and financial reporting of leases by governments. The Statement increases the usefulness of governments financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflow of resources and outflow of resources based on the payment provisions of the contract. It establishes a single model for lease accounting based on the foundational principle that leases are financings or' the right to use an underlying asset. Under this Statement, a lessee is required to recognize a lease liability and an intangible right to use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources, thereby enhancing the relevance and consistency of information about governments leasing activities.
(2) Cash and Investments
As of June 30, 2022, cash and investments were reported in the accompanying financial statements as follows:

Government-Wide
Statement of Net Position
Governmental Business-Type
Activities Activities
Fiduciary Funds
Statement of
Net Position Total
Cash and investments
Cash and investments
with fiscal agent
$ 84,911,372 $ 47,729,559 $ 2,250,140 $134,891,071
452,082 859,294 4,102,186 5,413,562
Total cash and investments $ 85,363,454 $ 48,588,853 $ 6,352,326 $140,304,633 84 54 706

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(2) Cash and Investments (Continued)
Cash and investments as of lune 30, 2022 consisted of the following:

Cash :

Cash on hand
Deposits with financial institution
Total Cash
Investments:

Investments
Investments held by bond trustee
Total Investments
Total Cash and Investments
$ 16,750
25,023,860
25,040,610
109,909,261
5,354,762
115,264,023
$ 140,304,633
The City maintains a cash and investment pool that is available for use for all funds. Each fund type's position in the pool is reported on the combined balance sheet as cash and investments. The City has adopted an investment policy, which authorizes it to invest in various investments.

A, Demand Deposits
At June 30, 2022, the carrying amount of the City's deposits was $24,9651060 and the bank balance was $25,250,532. The difference represents outstanding checks and other reconciling items.

The California Government Code requires California banks and savings and loan associations to secure a City's deposits by pledging government securities with a value of 110'/o of a City's deposits. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150'/o of a City's total deposits. The City Treasurer may waive the collateral requirement for deposits which are fully insured up to $250,000 by the FDIC.

The collateral for deposits in federal and state-chartered banks is held in safekeeping by an authorized Agent of Depository recognized by the State of California Department of Banking. The collateral for deposits with savings and loan associations is generally held in safekeeping by the Federal Home Loan Bank in San Francisco, California as an Agent of Depository.

These securities are physically held in an undivided pool for all California public agency depositors. Under Government Code Section 53655, the placement of securities by a bank or savings and loan association with an "Agent of Depository" has the effect of perfecting the security interest in the name of the local governmental agency. Accordingly, all collateral held by California Agents of Depository are considered to be held for, and in the name of, the local governmental.
85 55 707

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(2) Cash and Investments (Continued)
B. investments Authorized by the California Government Code and the City's Investment Policy
The table below identifies the investment types that are authorized of the City by the California Government Code and the City's investment policy. 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.

Investment Types Authorized by
State Law
u.s. Treasury Obligations
Federal Agency Obligations
u.s. Government Sponsored Enterprise
Securities
Bankers' Acceptances
Commercial Paper
Negotiable Certificates of Deposit
Repurchase Agreements
Reverse Repurchase Agreements
Medium-Term Notes
Money Market Mutual Funds
Mortgage Pass-Through Securities
County Pooled Investment Funds
Local Agency Investment Fund (LAIF)
Authorized by
Investment
Policy
Yes
Yes
Yes
Yes
Yes
Yes
No
No
Yes
Yes
No
No
Yes
Maximum
Maturity
5 years
5 years
5 years
180 days
270 days
5 years
1 year
92 days
5 years
N/A
5 years
N/A
N/A
Maximum
Percentage of
Portfolio
None
None
None
40o/o
30'/o
None
None
20'/o
30'/o
None
20'!/o
None
None
Maximum
Investment in
One Issuer
No ne
No ne
None
30'/o
10o/o
None
None
None
10o/o
No ne
None
None
None
*Based On state law requirements or investment policy requirements, whichever is m:ire restrictive 86 56
708

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(2) Cash and Investments (Continued)
C. Investments Authorized by Debt Agreements
Investment of debt proceeds held by bond trustee is 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, credit risk, and concentration of credit risk.

Authorized Investment Types
Local Agency Bonds
u.s. Treasury Obligations
u.s. Agency Securities
Bankers' Acceptances
Commercial Paper
Repurchase Agreements
Money Market Mutual Funds
Local Agency Investment Fund (LAIF)
Investment Agreements
D. Investment in State Investment Pool
Maximum
Maturity
5 years
5 years
None
1 year
270 days
30 days
N/A
N/A
N/A
Maximum
Percentage
Allowed
None
None
None
40'/o
25'/o
None
None
None
None
Maximum
Investment in
One Issuer
None
None
None
30'/o
10'/o
None
None
None
None
The City is a voluntary participant in the LAIF that is regulated by the California Government Code Section 16429 under the oversight of the Treasurer of the State of California. LAIF is not registered with the Securities and Exchange Commission. The fair value of the City's investment in this pool is reported in the accompanying financial statements at amounts based upon the City's pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis. The City's investments with LAIF at June 30, 2022, included a portion of the pool funds invested in Structured Notes and Asset-Backed Securities:

Structured Notes - debt securities (other than asset-backed securities) whose cash flow characteristics (coupon rate, redemption amount, or stated maturity) depend upon one or more indices and/or that have embedded forwards or options.

Asset-Backed Securities - generally, mortgage-backed securities that entitle their purchasers to receive a share of the cash flows from a pool of assets such as principal and interest repayments from a pool of mortgages (for example, Collateralized Mortgage Obligations) or credit card receivables.

As of June 30, 2022, the City had $49,499,976 invested in LAIF, which had invested 2.31o/o of the pool investment funds in Structured Notes and Asset-Backed Securities 87 57
709

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(2) Cash and Investments (Continued)
E. Fair Value Measurements
At June 30, 2022, 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, 2022:

Investment Type Level 2
Not subject to
measurement Total
Local Agency Investment Fund $
Certificates of deposits
Money m=irket funds
u.s. government sponsored
enterprise securities
Held by fiscal agent:

Money market funds
$ 49,499,976 $ 49,499,976
24,233,754 24,233,754
5,318,651 5,318,651
30,856,880 30,856,880
51354,762 5,354,762
Total $ 55,090,634 $ 60,173,389 $ 115,264,023
The certificates of deposits are valued based on matrix pricing and the u.s. government sponsored enterprise securities are valued based on institutional bond quotes.

F. Risk Disclosures
Credit Risk
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 or a rating by a nationally recognized statistical rating organization. LAIF does not have a rating provided by a nationally recognized statistical rating organization.

At June 30, 2022, the City's investments are rated as following:

Investment Type
Local Agency Investment Fund
Certificates of deposits
Money market funds
u.s. government sponsored
enterprise securities
Held by fiscal agent:

Money market funds
Total
$ 49,499,976
24,233,754
5,318,651
30,856,880
5,354,762
$ 115,264,023
Minimum
Legal
Rating
N/A
N/A
AAA
AAA
Ratings
at Year-End
AA or AAA Not Rated
$ 49,499,976
24,233,754
5,318,651
30,856,880
5,354,762
$ 41,530,293 $ 73,733,730
710

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(2) Cash and Investments (Continued)
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 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. As of June 30, 2022, none of the City's deposits or investments was exposed to custodial credit risk.

Concentration of Credit Risk
The City's investment policy imposes restrictions with the exception of u.s. Treasury securities, federal agency securities, u.s. government sponsored enterprise securities, overnight sweep accounts, and authorized pools that no more than 30'/o of the City's total investment portfolio to be invested in a single security type or 10'/o in any one corporate or bank issuer. With respect to concentration risk, as of June 30, 2022, the City is in compliance with its investment policy.

Investments in any one issuer that represent 5o/o or more of total City investment are as follows:

Investment Type Issuer
Reported
Am:iunt
Percentage
of Portfolio
u.s. government sponsored
enterprise securities
u.s. government sponsored
enterprise securities
u.s. government sponsored
enterprise securities
Federal Farm Credit Bank
Federal Home Loan Bank
Freddie Mac
$ 6,506,520
7,422,680
6,608,870

5.92o/o

6. 75'/o

6.01'/o
89 sg 711

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(2) Cash and Investments (Continued)
Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value oT an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of shorter term and longer term investments and by timing cash flows from maturities 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 City has elected to use the segmented time distribution method of disclosure for its interest rate risk.

At June 30, 2022, the City's investments have the following remaining maturities:

Investment Type
Local Agency Investment Fund
Certificates of deposits
Money market funds
u.s. gOVernment sponsored
enterprise securities
Held by fiscal agent:

Money market funds
Total
Totals
$ 49,499,976
24,233,754
5,318,651
30,856,880
Remaining Maturing (In Months)
12 Months 13 to 24 25 to 60
Or Less Months Months
$ 49i499,976
4,939,170
5,318,651
18 615 877 678, 707
25,354,280 5,502,600
5,354,762 5,354,762
$115,264,023 $ 65,112,559 $ 43,970,157 $ 6,181,307
(3) Lease Receivable
The City is the lessor in 2 noncancellable leases for building office space and a land lease.

The lessees are required to make fixed monthly payments ranging from $1,664 to $10,000 per month. The City recognized $117,964 in lease revenue and $33,863 in interest revenue during the current fiscal year related to these agreements. As of June 30, 2022, the lease receivable is $782,286 and deferred inflow of resources related to leases is $758,674. 90 60 712

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(4) Notes and Loans Receivable
Summary of changes in notes and loans receivable for the year ended June 30, 2022 is as follows:

Program
Rental Rehabilitation
Section 8 Repayment Program
CDBG and First Time Home Buyers
CalHome Loan Program
Total
A. Renta/ Rehabilitation
Balance
luly 1, 2021 Additions
$ 17,433
14,415
8,738,733
342,680
$ 9,113,261 $
Deletions
Balance
June 30, 2022
(346,692)
$ 17,433
14,415
8,392,041
342,680
$ (346,692) $ 8,766,569
The City participates in a Rental Rehabilitation Program. The purpose of the Rental Rehabilitation Loan Program is to assist owners of smaller rental properties which are occupied by persons or families that have an income less than 80'/o of the statewide median income. At June 30, 2022, the City has rental rehabilitation outstanding balance in the amount of $17/433.

B. Section 8 Repayment Program
The City of South Gate also participates in a Section 8 Repayment Program. The program was authorized by Congress in 1974 and developed by HUD to provide rental subsidies for eligible tenant families (including single persons) residing in newly constructed, rehabilitated and existing rental and cooperative apartment projects. At June 30, 2022, the outstanding balance was $14,415.

C. CDBG First Time Home Buyer
The Community Development Department of the City of South Gate operates various loan programs under the Federal Community Development Block Grant Program which includes the First Time Homebuyer Program. This program provides zero percent interest silent second down payment assistance loans to residents who meet certain qualifications for the purpose of providing homeownership assistance to low-and-moderate income families.

The loans are secured by a deed of trust and monthly payments are not required. The loans become due and payable when any of the following occurs: 1) the property is sold or transferred, 2) property is no longer owner-occupied, 3) property is refinanced, 4) the last surviving borrower dies, at which time full repayment would be required, the loan is never forgiven. At June 30, 2022, the outstanding balance was $8,392,041. 91 61 713

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(4) Notes and Loans Receivable (Continued)
D. CalHome Loan Program
The Community Development Department of the City of South Gate operates a Homeowner Rehabilitation Program to assist low-income qualified residents make needed home repairs.

Home repairs include such things as new energy efficient windows, new rooj, upgraded electrical and plumbing, and to address other substandard conditions.

A one-time funding of $1,000,000 was awarded by the State of California Housing and Community Development Department to assist at least 15 residents with zero percent interest loans. This loan program is capped at $50,000 per household and is due and payable when any of the following occurs: 1) the property is sold or transferred, 2) property is no longer owner-occupied, 3) property is refinanced, 4) the last surviving borrower dies, or 5) at the end of thirty (30) years from loan origination, at which time full repayment would be required. The loan is never forgiven. At June 30, 2022, the outstanding balance is $342,680.
(5) Interfund Transactions
Due from Other Funds
GeneralFund $
Capital Improvement Projects Fund
Non Major Governmental Funds
Utility Authority Water Fund
Internal Services Funds
Total
A. Due To/From Other Funds
Due to Other Funds
General
Fund
329,590
Grant Special
Revenue Fund
$ 12,243,425 $
4,290
329,590 $ 12,247,715 $
Nonri'ejor
Governmental
Funds Total
2,082,902 $ 14,326,327
4,290
1,416,731
1,023
40,375
1,087,141
1,023
40,375
3,211,441 $ 15,788,746
Current interfund receivables and payables are the result of short-term borrowings at June 30, 2022.

B. Advances To/From Other Funds
On November 13, 2001, a $21/985,000 advance was made between the General Fund and the Sewer Fund to fund certain improvements to the sewer systems. On of June 28, 2022, The City Council authorized the advance of $21,985,000 from the Sewer Enterprise Fund of the Utility Authority satisfied and written off. As such, the advance outstanding at June 30, 2022, is $0.

On April 23, 2020, the City Council approved cooperation agreement between the City and the Housing Authority to provide needed financing for the purchase of property for development of low-moderate income housing project. The General Fund advanced $1,813,000 to the Nonmajor Governmental Funds (Housing Successor Special Revenue 92 62
714

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(5) Interfund Transactions (Continued)
Fund). As of June 30, 2022, the outstanding balance for the advance was in the amount of $1,813,000. The advance is to be repaid upon sale of the project.

C, Interfund Transfers
Transfers In
Capital Non-major Utility Authority Utility Authority Interna Improvement Governmental Water Sewer Service
Transfers Out General Fund Projects Fund Funds Fund Fund Funds Tota General Fund $ - $ 1,388,991 $ 1,263,273 $ - $21,985,000 $ 7,243,566 $31,880,830 GrantsSpecialRevenueFund - 12,456,950 83,772 - - 12,540,722 CapitalImprovementProjectsFund - 8,000 - 8,000
Non-majorGovernmentalFunds - 4,233,946 - 7,680 - - 4,241,626 AmericanRescuePlanAct(ARPA) 8,7B7,074 - 136 - 8,787,210 UtilityAuthontyWaterFund 4,700 - 4,700
UtilityAuthontySewerFund - 1,800 - 1,800
InternalServiceFunds 226,818 - 226,818
Total $ 8,787,074 $18,313,205 $ 1,355,045 $ 7,680 $21,985,136 $ 7,243 566 $57 691,706 The General Fund and Grant Special Revenue Fund transferred $1,388,891 and $121458/510, respectively, to the Capital Improvement Projects Fund to pay for capital improvement projects.

The General Fund, Grant Special Revenue Fund, and Capital Projects Fund, transferred $1,263,273, $83,722, and $8,000, respectively, to Special Revenue Funds to pay For various projects for traffic safety, median improvements, fleet management, information systems, and HOME program delivery costs.

The General Fund transferred $21,985,000 related to the Sewer Enterprise Fund advance write-off from the General Fund.

The General Fund transferred $71243,566 to cover deficit balances in the Internal Service funds.

The American Rescue Plan Act Fund transferred $8,787/075 to the General Fund to pay for eligible public safety costs.
93 63 715

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(6) Capital Assets
A, Governmental Activities
Capital assets activity for Governmental Activities for the year ended June 30, 2022, follows:

Capital assets, not being depreciated:

Land
Construction in progress
Total capital assets, not being depreciated
Capital assets, being depreciated:

Structures and improvements
Machinery and equipment
Right to use lease assets
Infrastructure street network
Subtotal
Less accumulated depreciation
Structures and improvements
Machinery and equipment
Right to use lease assets
Infrastructure street network
Subtotal
Total capital assets, being depreciated
Total capital assets, net
Balance
July 1, 2021' Additions Deletions
$ 3,738,993 $
19,019,773
22,758,766
28,717,672
16,936,588
158,982
387,022,031
432,835,273
11,138,155
11 138 155
3 ,445,622
4 41,942
35,549
18,450,923
22,374,036
(16,081,902)
(16,081,902)
(240,938)
(240,938)
(17,522,508) (801,962)
(12,320,662) (977,188) 240,938
(67,215)
(193,370,856) (8,064,609)
(223,214,026) (9,910,974) 240,938
209,621,247 12,463,062
$ 232,380,013 $ 23,601,217 $ 16,081,902
Balance
June 30, 2022
$ 3,738,993
14,076,026
17,815,019
32,163,294
17,137,592
194,531
405,472,954
454,968,371
(18,324,470)
(13,056,912)
(67,215)
(201,435,465)
(232,884,062)
222,084,309
$ 239,899,328
* The balance at July 1, 2021 has been restated to reflect the implementation of GASB 87 and to correct certain prior period errors as described further in note 17.

Depreciation expense was charged to functions/programs of the primary government in the Governmental Activities as follows:

General government
Police
Parks and recreation
Community development
Public works
Fleet management
Information system
Buildings
Capital asset and equipment replacement
Total depreciation expense
31,409
493,943
1,029,635
15,812
7,915,237
4,896
187,287
59, 534
173,221
$ 9,910,974
94 64 716

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(6) Capital Assets (Continued)
B. Business Type Activities
Capital assets activity for Business-Type Activities for the year ended June 30, 2022, follows:

Capital assets, not being depreciated:

Water rights
Land
Construction in progress
Total capital assets, not being depreciated
Capital assets, being depreciated:

Structures and improvements
Machinery and equipment
Infrastructure utility distribution system
Subtotal
Less accumulated depreciation
Structures and improvements
Machinery and equipment
Infrastructure utility distribution system
Subtotal
Total capital assets, being depreciated
Total capital assets, net
Balance
July 1, 2021
$ 1,933,144
1,290,602
3,381,711
6,605,457
4,190,415
6 ,734,169
7 3,623,454
8 4,548,038
(1,590,397)
(5,230,605)
(33,854,246)
(40,675,248)
43,872,790
$ 50,478 247 $
Additions
97,035
97,035
5,423,642
37,611
22,413
5,483,666
Deletions
Balance
June 30, 2022
(3,295,093)
(:i,;gs,og:g)
1,933,144
1,290,602
183,653
3,407,399
(25,057)
(25,057)
9,614,057
6 ,746,723
7 3,645,867
90,006,647
(96,712) (1,687,109)
(232,815) 25,057 (5,438,363)
(2,489,153) - (36,343,399)
(2,818,680) 25,057 (43,468,871)
2,664,986 - 46,537,776
2762,021 $ 3,295,093 $ 49,945,175
Depreciation expense was charged to functions/programs of the primary government in the Business-Type Activities as follows:

Water Enterprise Fund
Sewer Enterprise Fund
Total depreciation expense
$ 2,283,986
534,694
$ 2,818,680
95 65
717

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(7) Lonq Term Liabilities
A. Governmental Activities
The following is summary of changes in governmental activities long-term liabilities for the year ended June 30, 2022:

Governmental activities:

Notes payable:

SCE Edison financing agreements
Motorola Solutions A loan
Motorola Solutions B loan
Total notes payable
Public offering:
2005 Pension obligation bonds
Total bonds
Lease payable:

Vehicle lease
Copier lease
Total lease payable
Total long-term debt
Balance
7/1/2021*
$ 353,339
146,902
796,412
1,296,653
11,480,000
11,480,000
Addition Deletion
Balance
June 30, 2022
$ (84,971) $ 268,368 $
(146,902)
(391,761) 404,651
(623,634) 673,019
(1,395,000)
(1,395,000)
10,085,000
10,085,000
Due within
One Year
83, 548
404,651
488,199
1,470,000
1,470,000
79,168 30,306 (47,746) 61,728 29,405
79,814 - (17,014) 62,800 17,419
158,982 30,306 (64,760) 124,528 46,824
12,935,635 30,306 $ 2,083,394 10,882,547 $ 2 005,023 * The balance at July 1, 2021 has been restated to reflect the implementation of GASB 87 and to correct prior period errors related to notes payable as described further in note 17, Notes Payable
Southern California Edison On-Bill Financinq
The City entered into a financing agreement with Southern California Edison (direct borrowing) to provide five loans for a total of $882,556 for the implementation of certain energy conservation measures at City facilities. The City is to make monthly payments of $7,946 over a ten-year period. Payments commenced on December 30, 2015, and the last payment will be made on June 30, 2026. The loan has no interest. At June 30, 2022, the outstanding balance is $268,368.

The following schedule summarizes the debt service to maturity requirements for Southern California Edison debt outstanding as of June 30, 2022:

Year Ending
June 30,
2023
2024
2025
2026
Total
Principal
$ 83,548
78,004
76,363
30,453
268,368
96 66
718

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(7) Lonq Term Liabilities (Continued)
Motorola Solutions
The City entered into a financing agreement with Motorola for the purchase of hardware and software which includes consoles, radios and services for the South Gate Police Department in the amount of $1,253,890. The City is to make annual payments of $417,963 over a three-year period. At June 30, 2022, outstanding balance is $404,651.

The following schedule summarizes the debt service to maturity requirements for debt outstanding as of June 30, 2022:

Year Ending
June 30,
2023
Total
Principal
404,651
404,651
Bonds
2005 Pension Obliqation Bond
Interest
13,313
13,313
Total
417,964
417,964
In March 2005, the City of South Gate issued $24,400,000 in Pension Obligation Bonds (public offering). The proceeds were used to provide funds to cover the City's unfunded actuarial liability for safety employees through June 30, 2004. Proceeds were also used to advance refund $6,675,000 of outstanding 2001 Taxable Certificates of Participation. The net proceeds were deposited in an escrow account with u.s. Bank National Association. The Certificates of Participation are considered defeased and have been paid in full.

The bonds mature in amounts ranging from $1,070,000 to $11910,000 with interest ranging from 4.6o/o to 5.42'/o. Interest on the bonds is payable on December 1, 2005 and semi- annually thereafter on June 1 and December 1 of each year. The bonds were issued at face value. At lune 30, 2022, the outstanding balance on the bonds is $101085/000.

The following schedule summarizes the debt service to maturity requirements for governmental activities bonds payable outstanding as of June 30, 2022:

Year Ending
June 30,
2023
2024
2025
2026
2027
2028
TOtal
Principal
$ 1,470,000
1,545,000
1,630,000
1,720,000
1,810,000
1,910,000
Interest
543, 582
464,349
381,073
293,216
200, 508
102,949
Total
$ 2,013,582
2,009,349
2,011,073
2,013,216
2,010,508
2,012,949
$ 10,085,000 $ 1,985,677 $ 12,070,677
97 67 719

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(7) Lonq Term Liabilities (Continued)
Lease Payable
Vehicle Lease
The City entered into six leases agreements for the right to use vehicles in the amount or $225/578. The City is to make monthly payments between $682 and $996 over five-year periods. At June 30, 2022, the outstanding balance is $611728.

The following schedule summarizes the debt service to maturity requirements For debt outstanding as of June 30, 2022:

Year Ending
June 30,
2023
2024
2025
2026
Total
Copier Lease
Principal
$ 29,405
16,259
10,024
6,040
$ 61,728
Interest
1,863
997
428
101
3,389
Total
31,268
17,256
10,452
6,141
65,117
The City entered into an agreement for the right to use copiers in the amount of $79,814.

The City is to make monthly payments of $1,559 over a five-year period. At June 30, 2022, the outstanding balance is $62,800.

The following schedule summarizes the debt service to maturity requirements for debt outstanding as of June 30, 2022:

Year Ending
June 30,
2023
2024
2025
2026
TOtal
Principal
17,419
17 ,832
18 ,258
9t291
62,800
Interest
1,289
876
450
62 2,677
TOtal
18,708
18,708
18,708
9,353
65,477
98 68 720

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(7) Lonq Term Liabilities (Continued)
Compensated Absences
The following is summary of changes in governmental activities compensated absences for the year ended June 30, 2022:

Balance
July 1, 2021
Compensated absences $5,628,554
Addition
$ 2,755,710
Deletion
$(3,455,212)
Balance
June 30, 2022
$ 4,929,052
Due within
One Year
$ 450,648
For governmental activities, accumulated vacation, sick leave benefits, holiday and compensatory time payable at June 30, 2022, was $4,929,052. Vacation, sick leave, holiday and compensatory time are recorded as expenditures in the related funds when used, mainly in the General Fund.

B. Business-Type Activities
The following is summary of changes in business-type activities long-term liabilities for the year ended June 30, 2022:

Balance
luly 1, 2021 Addition
Business-Type Activities:

Public Offering:
2019A Water Revenue
Refunding Bonds
2019AT Water Revenue
Refunding Bonds
Unarmrtized premum
Total long-term debt
$ 7,935,000 $
21,790,000
988,226
$ 30,713,226 $
201 9 Series A and AT Water Revenue Bonds
Deletion
$ (55,000)
(1,590,000)
(69,349)
$(1,714,349)
Balance
June 30, 2022
$ 7,880,000
20,200,000
918,877
$ 28,998,877
Due within
One Year
$ 60,000
1,620,000
69,349
$ ),749,349
On December 5, 2019, the South Gate Utility Authority issued $31/340,000 of 2019 Series A and AT Water Revenue Bonds. Proceeds of these bonds were used to refund the Authority's 2001 Subordinate Revenue Bonds and 2012 Series Water Revenue Bonds and pay costs of issuance of these bonds. The refunding resulted in saving in debt service payment in the amount of $7,568,399 and economic gain in present value saving of $5,941,319. The outstanding balance of the refunded debt at June 30, 2022 was $28,998,877.

Debt covenants of the 2019 Revenue Bonds require that the Utility Authority set its charges at rates that will produce net water revenues that are at least equal to 120'/o of the proportionate share of certain debt service payments (as defined in the official statement).

Net water revenue received during the year was $7,715,551. Total principal and interest paid for the fiscal year was $2/505,556 for 2019 Series A and AT Water Revenue Bonds. 99 69 721

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(7) Lonq Term Liabilittes (Continued)
The following schedule summarizes the debt service to maturity requirements for the bonds outstanding as of June 30, 2022:

Year Ending
June 30,
2023
2024
2025
2026
2027
2028- 2032
2033-2036
Total
Compensated Absences
Principal
$ 1,680,000
1,715,000
1,755,000
1,795,000
1,840,000
10,015,000
9,280,000
Interest
$ 827,639
791,722
752, 853
710,856
665,624
2,522,703
751,244
Total
$ 2,507,639
2,506,722
2,507,853
2,505,856
2,505,624
12,537,703
10,031,244
$ 28,080,000 $ 7,022,641 $ 35,102,641
The following is summary of changes in business-type activities compensated absences for the year ended June 30, 2022:

Balance
July 1, 2021 Addition Deletion
Balance
June 30, 2022
Due within
One Year
Compensated absences $ 372,380 $ 266,515 $ (283,229) $ 355,666 $ 32,517 For the enterprise Funds, accumulated vacation, sick leave, holiday and compensatory time amounted to $355,666 at June 30, 2022. The liability will be paid in future years by the Utility Authority Water Fund and the Utility Authority Sewer Fund. (8) Defined Contribution Plan
The City has established a defined contribution plan in accordance with Internal Revenue Code Section 401(a) to provide tax deferred payments towards retirement for employees. Under this plan, the City will provide a dollar-for-dollar match of the contributions paid by the employee into a 457 deferred compensation plan up to one-half the annual contribution limit set by the IRS. For the year ended June 30, 2022, the City contributed $296,073 to the plan. 100
70 722

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans
The following is the summary of net pension liability and related deferred outflows of resources and deferred inflows of resources at June 30, 2022 and pension expense for the year then ended.

CalPERS
Miscellaneous
CalPERS
Safety PARS Total
Net pension liability $20,670,896 $40,036,851 $ 175,297 $60,883,044 Deferred outflows of resources $ 5,606,522 $13,510,831 $ 93,404 $19,210,757 Deferred inflow of resources $15,404,657 $27,189,560 $ 129,089 $42,723,306 Pension expense (credit) $ 460,007 $10,955,092 $ (74,095) $11,341,004 A, California Public Employees' Retirement System ("CalPERS") General Information about the Pension Plan
Plan Description
The City contribution to the California Public Employees Retirement System ("CalPERS"), an agent multiple-employer defined benefit pension plan for miscellaneous employees and a cost-sharing multiple-employer defined benefit plan for safety employees. CalPERS act 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 statue and City ordinance. A full description of the pension plan regarding number of employees covered, benefit provisions, assumptions (for funding, but not accounting purposes), and membership information are listed in the annual actuarial valuation report. This report and CalPERS' audited financial statements are publicly available reports that can be obtained at CalPERS" website under Forms and Publications.
101
71 723

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans (Continued)
Benefits Provided
CalPERS provide retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. Benefits provisions under both plans are established by the State statute and City resolution as follows:

Hire date
Benefit formula
Benefit vesting schedule
Benefit payments
Retirement age
Monthly benefits, as a "/o of
eligible compensation
Required employee contribution rates
Required employer contribution rates
" Closed to new entrants
Miscellaneous Plan Safety Plan
Classic'
Prior to
lanuary 1, 2013

2.7o/o @ 55
5 years of service
monthly for life
minimum 50

2.000'/o - 2.700o/o

8. 000"!/o

11.590'!"o
PEPRA Classic' PEPRA
On or after Prior to On or after
January 1, 2013 January 1, 2013 January 1, 2013

2.0'/o @ 62 3.Oo/o @ 50 2.7'/0 @ 57
5 years of service 5 years of service 5 years of service monthly for life monthly for life rmnthly for life minimum 52 minimum 50 minimum 50

1.000'/o - 2.500o/o

6.500'!/o

11.590'/o

3.00'!/o

9.000'/o

25. 590'!/(1

2.000'/o - 2.700'%

13.750o/o

13.980'/o
Industrial disability benefits are not offered to miscellaneous employees. The City provides industrial disability retirement benefit to safety employees. The industrial disability retirement benefit is a monthly allowance equal to 50 percent of final compensation.

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 or retirement, retirement and survivor allowances will be annually adjusted on a compound basis by 2 percent. 102
72 724

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans (Continued)
Employees Covered by Benefit Terms
At the June 30, 2021 measurement date, the following employees were covered by the benefit terms:

Active employees
Transferred and terminated employees
Retired Employees and Beneficiaries
Total
Contribution Description
Miscellaneous
255
404
364
1,023
Safety
Classic
46 43
208
297
PEPRA
28 1
29 Section 20814(c) of the California Public Employees" Retirement Law (PERL) requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate.

The total plan contributions are determined through CalPERS" annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The employer is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employer contribution rates may change :F plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan member contribution requirements are classified as plan member contributions.

Net Pension Liability
Actuarial Methods and Assumptions Used to Determine Total Pension Liability The June 30, 2020 valuation was rolled forward to determine the June 30, 2021 total pension liabilities, based on the following actuarial methods and assumptions:

Actuarial Cost Method Entry Age Normal in accordance with the requirement of GASB 68
Actuarial Assumptions:

Discount Rate 7.l59'o
Inflation 2.50'/o
Salary Increases Varies by Entry Age and Service
Mortality Rate Table Dervied using CalPERS' membership data for all funds Post Retirement Benefit Increase The lesser of contract COLA or 2.5o/o until Purchasing Power Protection Allowance floor on purchasing power applies, 2.5'!/o thereafter
103
73 725

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans (Continued)
The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. Pre- retirement and Post-retirement mortality rates include 15 years of projected mortality improvement using 90'/o of Scale MP-2016 published by the Society of Actuaries.

For more details on this table, please refer to the CalPERS Experience Study and Review of Actuarial Assumptions report from December 2017 that can be found on the CalPERS website.

Change in Assumptions
There were no changes in assumptions.

Lonq-Term Expected Rate of Return
The long-term expected rate of return on pension plan investments was determined using a building-block method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.

In determining the long-term expected rate of return, CalPERS took into account both short- term and long-term market return expectations as well as the expected pension fund cash flows. Using historical returns of all the funds' asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11+ years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equal to the single equivalent rate calculated above and adjusted to account for assumed administrative expenses.

The expected real rate of return by asset class as followed:

Asset Classl
Current Target
Allocation
Public equity
Fixed income
Inflation assets
Private equity
Real assets
Liquidity

50.00'/o

28.00'/o

0.00'/o

8.00'/o

13.00'/0

1.00'/O
100.00'/o
Real Return
Years 1- 102

4. 80'/o
l.OOo/o

0. 77o/o

6. 30'/o

3. 75o/o
Real Return
Years 11+3

5.98'/o

2. 62'/o

1.810/o

7. 230/o

4.93'/o
-0.92'/o
In the System's CAFR, Fixed Income is included in Global Debt Securities; Liquidity is included in Short-term 2InAvnesetXmpeencttse,a Ilnnffllaatti.loonn Aosfs2et0soaO/roeuisnecdlufdOerdthinlsbpoetrhloGdtobal Equity Securities and Global Debt Securities.

An expected inflation of 2.92'/o used for this period 104
74 726

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans (Continued)
Discount Return
The discount rate used to measure the total pension liability was 7.15/o. 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.

Chanqes in the Net Pension Liability
The following table shows the changes in net pension liability for the miscellaneous plan recognized over the measurement period.

Miscellaneous Plan
Balance at June 30, 2020 (Valuation Date) $
Changes Recognized for the Measurement Period:

Service Cost
Interest on the total pension liability
Changes of benefit terms
Changes of assumptions
Difference between expected and actual experieni
Contributions from the employer
Contributions from employees
Net investment income
Administrative expenses
Plan to plan resource movement
Other Miscellaneous Income/(Expense)
Benefit payments, including refunds of employee
contributions (7,all,754) (7,011,754)
7,915,792 29,202,618 (21,286,826)
$ 183 724 478 $ 163 053 582 $ 20 670 896
Net Changes during luly 1, 2020 to June 30, 2021
Balance at June 30, 2021 (Measurement Date)
Increase (Decrease)
Total Pension Plan Fiduciary Net
Liability Position
(a) (b)
175,808,686 $ 133,850,964 $
3,140,084
12,388,906
(601,444)
4,879,335
1,142,823
30,325,923
(133,709)
Net Pension
Liability/(Asset)
(C) = (a) - (b)
41,957,722
3,140,084
12,388,906
(601,444)
(4,879,335)
(1,142,823)
(30,325,923)
133,709
105
75 727

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans (Continued)
Proportionate Share of Net Pension Liability and Pension Expense The following table shows the City's safety plan's proportionate share of the risk pool collective net pension liability over the measure period.

Balance at June 30, 2020 (Measurement Date)
Balance at June 30, 2021 (Measurement Date)
Net Changes during 2020-2021
Safety Plan
Increase (Decrease)
Total Pension Plan Fiduciary Net Net Pension
Liability Position Liability/(Asset)
(a) (b) (C)=(a)-(b)
$ 184,765,880 $ 126,391,602 $ 58,374,278
189,896,593 149,859,742 40 036 851
5,130,713 23,468,140 (18,337,427)
The City's proportionate share of the net pension liability was based on a projection of the City's long-term share of contributions to the pension plans relative to the projected contributions of all participating employers, actuarially determined.

Deferred outflows of resources, deferred inflows of resources, and pension expense are allocated based on the City's share of contributions made during the measurement period.

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

Safety Plan
6/30/2020 (Measurement Date)
6/30/2021 (Measurement Date)
Change - Increase (Decrease)

0.536507o/o

0.740287o/o

0.203780o/o
Sensitivity of the Net Pension Liability to Chanqes in the Discount Rate The following presents the net pension liability of the Plan as of the measurement date, calculated using the discount rate of 7.15 percent, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage-point lower (6.15 percent) or 1 percentage-point higher (8.15 percent) than the current rate:

Miscellaneous Plan
Safety Plan
Plan's Net Pension Liability/(Asset)
D!SCOLlnt Rae - l'/o Current Discount Discount Rate + l'/o (6.l5o/o) Race (7.15'/o) (8.15'/o)
$ 46,695,593 $ 20,670,896 $ (626,121)
$ 65,598,571 $ 40,036,851 $ 19,041,055
Pension Plan Fiduciary Net Position
Detailed information about the plan's fiduciary net position is available in the separately issued CalPERS financial report.
106
76 728
CITY OF SOUT!'. GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans (Continued)
Pension Plan Fiduciary Net Position
Detailed information about the plan's fiduciary net position is available in the separately issued CalPERS financial report.

Pension Expense and Deferred Outflows and Deferred Inflows of Resources Related to Pensions
As of measurement date of June 30, 2021, the City has deferred outflows and deferred inflows of resources related to pensions as follows.

Miscellaneous Plan
Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contribution after measurement date
Difference between expected and actual
experience
Net difference between projected and actual
earning on pension plan investments
5,234,731 $
371i791 (370,119)
(15,034,538)
$ 5,606,522 $ (15,404,657)
Safety Plan
Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contribution after measurement date
Difference between expected and actual
experience
Net difference between projected and actual
earning on pension plan investments
Adjustment due to differences in proportions
Employer contributions in excess (under)
proportionate contributions
6,175,454 $
6,840,261
495,116
(23,829,623)
Total
(3,359,937)
$ 13,510,831 $ (27,189,560)
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). The EARSL for the miscellaneous plan and the safety risk pool for the measurement date ending June 30, 2021 is 2.6 and 3.8 years, which was obtained by dividing the total service years of 2,632 and 548,581 (the sum of remaining service lifetimes of the active employees) by 1,011 and 145,663 (the total number of participants: active, inactive, and retired), respectively. Inactive employees and retirees have remaining service lifetime equal to O. Total future service is based on the members' probability of decrementing due to an event other than receiving a cash refund.
107
77 729

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans (Continued)
$5,234,731 and $6,175/454 reported as deferred outflows of resources related to pensions for miscellaneous plan and safety plan, respectively, resulting from the City's contributions subsequent to the measurement date during the fiscal year ended June 30, 2022 will be recognized as a reduction of the net pension liability and collective net pension liability in the year ending June 30, 2023. Other amounts reported as deferred outflows or deferred inflows of resources related to pensions will be recognized as pension expense as follows:

Fiscal Year
Ending June 30
2023
2024
2025
2023
2027
Thereafter
Total
Subsequent Events
Deferred Outflows/
(Inflows) of Resources
Miscellaneous
Deferred Outflows/
(Inflows) of Resources
Safety
(3,639i565) $
(3,615,474)
(3,615,080)
(4,162,747)
(15,032,866) $
(3,629,634)
(4,288,717)
(5,378,252)
(6,557,580)
(19,854,183)
On July 12, 2021, CalPERS reported a preliminary 21.3'/o net return on investments for fiscal year 2020-21. Based on the thresholds specified in CalPERS Funding Risk Mitigation policy, the excess return of 14.3'/o prescribes a reduction in investment volatility that corresponds to a reduction in the discount rate used for funding purposes of O.20'/o, from

7.00o/o to 6.80o/o. Since CalPERS was in the final stages of the four-year Asset Liability Management (ALM) cycle, the board elected to defer any changes to the asset allocation until the ALM process concluded, and the board could make its final decision on the asset allocation in November 2021.

On November 17, 2021, the board adopted a new strategic asset allocation. The new asset allocation along with the new capital market assumptions, economic assumptions and administrative expense assumption support a discount rate of 6.90'/o (net of investment expense but without a reduction for administrative expense) for financial reporting purposes. This includes a reduction in the price inflation assumption from 2.50o/o to 2.30'/o as recommended in the November 2021 CalPERS Experience Study and Review or Actuarial Assumptions. This study also recommended modifications to retirement rates, termination rates, mortality rates and rates of salary increases that were adopted by the board. These new assumptions will be reflected in the GASB 68 accounting valuation reports for the June 30, 2022, measurement date.
108
78 730

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans (Continued)
B. Supplemental Retirement Plan
General Information about the Pension Plan
Plan Description
Effective July 1, 2002, the City established a supplemental retirement plan with the Public Agency Retirement System ("PARS"). The supplemental retirement plan administered by PARS (the "PARS plan") is an agent multiple-employer defined benefit pension plan. The PARS plan is separated into two tiers. The PARS plan was organized under the authority of the City Council and may be amended by the City Council. The City issues a stand-alone financial report that is available to the public. The report is available on the City's website.

Benefits Provided
Tier one provides for the difference between the 3'/o at 55 benefits and the 2.7'/0 at 55 benefits for years of service to the City. Eligibility to receive benefits is as follows:
* Must be a full-time Top Management miscellaneous (non-safety) employee of the City of South Gate on or after July 1, 2002. Employees hired after December 31, 2012 are not eligible to participate in the Plan. * Must have completed three years of full-time continuous employment with the City prior to retirement.
* Must concurrently retire from PERS at the time of application for benefits under this plan.
* Must either 1) be at least fifty-five years of age, if retirement is concurrent with separation from the City or 2) be at least sixty years of age. * Must apply for the benefits, and meet the age requirements.

Tier two provides a monthly lifetime annuity payment to eligible employees in lieu of post- employment health care benefits. Eligibility to receive benefits is as follows:
* Must have retired from the City with 20 or more years of service. * Must remain retired.
* Must not participate in the PERS health plan offered by the City.

Employees Covered by Benefit Terms
At June 30, 2021, the valuation date, plan membership consisted of the following:

Active employees
Terminated employees
Retired Employees and Beneficiaries
1 28
Total 29
109
79 731

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans (Continued)
Contributions
The employer contribution rates for all public employees are determined on an annual basis by the actuary and are effective on the July 1 following notice of a change in the rate. The total plan contributions are determined by an independent pension actuary using information furnished by the City and by PARS. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. For the year ended June 30, 2022, the City contributed $49,000 for the plan. No contributions are required from the employees.

Net Pension Liability
The City's total pension liability was valued as of June 30, 2020 and was used to calculate the net pension liability measured as of lune 30, 2021.

Actuarial Methods and Assumptions Used to Determine Total Pension Liability The total pension liability in the June 30, 2021 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement:

Actuarial Cost Method
Arnortization Method
Arnortization period
Entry age normal , level percent of pay
Closed period, level percent of pay
20 years
Inflation 5,90'/o
Investment return
Mortality
Retirement

6. 22'/o
CalPERS rates
CalPERS rates
110
80 732

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans (Continued)
Lonq-Term Expected Real Rate of Return
The long-term expected rate of return is determined using the long-term rates of return developed by CalPERS Investment Office in their report dated May 14, 2018.

Index
Large Cap Core
Mid Cap Core
Small Cap Core
International
Ernerging Markets
Real Estate
Short-Term Bond
Intermediate - Term Bond
High - Yield Bond
Cash
Discount Rate
Target
Allocation

32.00'/o

6. 00'/o

9. 00'/o

7. 000/o

4. 00o/o

2. 00'!/o

6.75'/o

27. 00'/o

1.25'/o

5. 00'/o
Long-Term
Expected
Real Rate
of Return

6. 80'/o

7. 10'/o

7.90'/o

7. 30'/o

7. 30'/o

6. 60'/o

3.30'/0

3.90"/0

6.10'/0

2.40'/a
100.000/o
The discount rate used to measure the total pension liability is 6.22'/o. This is the expected long-term rate of return on City assets using the expected long-term rate of return on invested asSetS provided by Public Agency Retirement Services (PARS). 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 pension plan's fiduciary net position is projected to cover all future pension payments. Therefore, the discount rate was set equal to the long-term expected rate of return.
ill
81 733

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans (Continued)
Chanqe in Net Pension Liability
The following table shows the changes in net pension liability recognized over the measurement period.

Balance at June 30, 2020
Changes Recognized for the
Measurement Period:

Service Cost
Interest on the total pension liability
Difference between expected
and actual experience
Contributions from employees
Net investment income
Benefit payments, including refunds
Administrative expense
Net Changes
Ba.lance at June 30, 2021 (Measurement Date)
Total Pension
Liability
(a)
$ 1,605,800
7,560
96 992
(90,671)
(107,996)
(g+,iis)
1,511,685
Increase (Decrease)
Plan Fiduciary Net
Position
(b)
$ 1,139,650
Net Pension
Liability/(Asset)
(C) = (a) - (b)
$ 466,150
7,560
96,992
49,000
261,564
(107,996)
(5,830)
196,738
1,336,388 $
(90,671)
(49,000)
(261,564)
5,830
(290,853)
175,297
Sensitivity of the Net Pension Liability to Chanqes in the Discount Rate The following presents the net pension liability of the City, calculated using the discount rate of 6.22'/o, as well as what the Plan's net pension liability would be if it were calculated using a discount rate that is 1 percentage point lower (5.22'/o) or 1 percentage point higher (7.22'/o) than the current rate.

Plan's Net Pension Liability
Discount Rate
lo/o Decrease
(5. 22'/o)
$ 3311044
Pension Plan Fiduciary Net Position
Current
Discount Rate
(6. 22'/o)
$ 175,297
Discount Rate
l'/o Increase
(7. 22'/o)
$ 42,724
Detailed information about the plan's fiduciary net position is available upon request. 112
82 734

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(9) Retirement Plans (Continued)
Pension Expense and Deferred Outflows/Inflows of Resources Related to Penstons
At June 30, 2022, the City reported deferred outflows and deferred inflows of resources related to PARS plan as follows:

Pension contribution after measurement date
Net difference between expected and actual
earnings on pension plan investment
Total
Deferred Outflows
of Resources
$ 93,404
Deferred Inflows
of Resources
93,404 $
(129,089)
(129,089)
$93,404 reported as deferred outflows of resources related to pension contribution resulting from the City's contributions subsequent to the measurement date during the year ended June 30, 2022 will be recognized as a reduction of the net pension liability in the fiscal year ending lune 30, 2023. Other amounts reported as deferred outflows of resources related to pensions will be recognized as pension expense as follows:

Fiscal Year
Ending June 30
Deferred
Outflows/(Inflows)
of Resources
2023
2024
2025
2026
2027
Thereafter
Total
(28,919)
(30,418)
(31,214)
(38,538)
(129,089)
113
83 735

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(10) Other Postemployment Benefits
A. Plan Description
The City administers a single-employer defined-benefit post-employment healthcare plan (the Plan). Dependents are eligible to enroll, and benefits continue to surviving spouses.

Retirees are eligible for medical benefits if they retire with 20+ years of City service, and remain in or enroll in a CalPERS plan upon retirement, and remain so retired. For 2021, the City reimburses retirees who have attained age 50 and at least 20 years of service for 100'/o of premiums up to a maximum of $150/month for NonSafety Employees, $200/month for Top Management Employees, and $250/month for Safety Employees who retired before July 1 , 2005. Safety employees retired after July 1, 2005, who have attained age 50 and at least 2 0 years of service are eligible to receive up to the two-party Kaiser rate in effect on July 1, 2005 and increased each year by 5'/o maximum. The maximum does not change based on Medicare eligibility or spouse coverage. The terms of benefits provided are authorized and may be amended in the future by City Council.

At June 30, 2021, (the census date), the benefit term covered the following employees:

Active employees
Retired employees and beneficiaries
336
igr
527
B. Funding Policy
Retirees participating in PEMHCA are responsible for the payment of their medical insurance premiums except that the City contributes the minimum amount provided under Government Code Section 22825 of the Public Employees Medical and Hospital Care Act.

The amount contributed by the City during the year ended June 30, 2022 was $836,126, on a pay-as-you-go basis. The City has not established a trust for the purpose of holding assets accumulated for plan benefits.
114
84 736

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(10) Other Postemployment Benefits (Continued)
C, Actuarial Assumptions
The City's total OPEB liability was valued as of June 30, 2021, and was used to calculate the net OPEB liability measured as of June 30, 2021. The total OPEB liability in the June 30, 2021 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:

Discount Rate
Inflation
Salary Increases
Healthcare cost trend rates
Pre- Medicare
Medicare
Mortality Rate Table
D. Discount Rate
Entry Age Normal, Level Percentage of Salary

1.92'/o

5. 50'/o

2.75/o. Additional merit-based increases based on
CalPERS merit salary increase tables.

7.00o/o in the first year, trending down to 4.04o/o

6.OP/o fn the f!rSt Yeari trending down to 4.04'/o
over 56 years.

Based on CalPERS tables.

The discount rate used to measure the total OPEB liability was l.92o/o. The City's OPEB Plan is an unfunded plan, therefore the discount rate was set to the rate of tax-exempt, high- quality 20-year municipal bonds, as of the valuation date.

E. Change in the Total OPEB Liability
Balance at June 30, 2021
Changes Recognized for the Measurement Period:

Service Cost
Interest on the total OPEB liability
Changes of benefit terms
Difference between expected and actual experie
Changes of assumptions
Contributions from the employer
Contributions from employees
Benefit payments, including refunds of employee
contributions and implicit subsidy
Net Changes during luly 1, 2019 to June 30, 2020
Balance at June 30, 2020 (Measuremnt Date) $
Total OPEB
Liability
(a)
Increase (Decrease)
Plan Fiduciary Net
Position
(b)
Net OPEB
Liability/(Asset)
((-) = (aC - (b)
28 979 784
1,342,086
731,487
(3,057,982)
3139,649
(216,510)
1,938,730
30,918,514 $
(714,003)
(714,003)
(714,003) $
28 979 784
1,342,086
731,487
(3,057,982)
3,139,649
(714,003)
(216,510)
1,224,727
30,204,511
115
85 737

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(10) Other Postemployment Benefits (Continued)
Sensitivity of the Total OPEB Liability to Chanqes in the Discount Rate The following presents 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 1-percentage point lower (0.92o/o) or 1-percentage point higher (2.92'/o) than the current discount rate:

Plan's OPEB Liability/(Asset)
DiSCOunt Rae - lo/o Current: DiSCOunt DiSCOunt Rae + lo/o (0.92"/o) Rate (1,92o/o) (2.92'/o)
$ 34,624,975 $ 30,204,511 $ 26,562,480
Sensitivity of the Total OPEB Liability to Chanqes in the Health Care Cost Trend Rates The following presents the total OPEB liability of the City, as well as what the City's total OPEB liability would be if it were calculated using healthcare cost trend rates that are 1- percentage-point lower (6o/o) or 1-percentage-point higher (8'/0) than the current healthcare cost trend rates:

Healthcare Cost
Trend Rate - l'!/o
(6. 00'/o)
Plan's OPEB Liability/(Asset)
Healthcare Cost
Trend Rate
(7. 00'/o)
Healthcare Cost
Trend Rate + 1'/0
(8. 00'/o)
27,560,456 $ 30,204,511 $ 33,546,710
F. OPEB Liabilities, OPEB Expense and Deferred Outflows/Inflows of Resources to OPEB
For the year ended June 30, 2022, the City recognized OPEB expense of $1,327,692 for the City Plan. At June 30, 2022, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

OPEB contribution made after the measurement
period
Difference between expected and actual
experience
Changes of assumptions
Total
Deferred Outflows
of Resources
836,126 $
5,013,252
5,849,378 $
Deferred Inflows
of Resources
(7,436,782)
(646,431)
(8,083,213)
$836/126 reported as deferred outflows of resources related to OPEB resulting from the City's contributions subsequent to the measurement date will be recognized as a reduction of the net OPEB liability in the fiscal year ending June 30, 2023. Other amount reported as deferred inflows of resources related to OPEB will be recognized in the future OPEB expense as Follow:
116
86 738

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(10) Other Postemployment Benefits (Continued)
Fiscal Year
Endinq June 30
2023
2024
2025
2026
2027
Thereafter
Total
Deferred
Outflows/(Inflows)
of Resources
(745,881)
(745,881)
(637,759)
(559,054)
(551,649)
170,263
(3,069,961)
(11) Self-Insurance
The City is self-insured for general, automobile, public liability and worker's compensation claims. The City has purchased an excess insurance policy for worker compensation claims from Safety National Casualty Corporation. Under this policy, Safety National covers all workers' compensation claim expenses over $1,000,000 per claim for safety and over $750,000 for non-safety. An Internal Service Fund is used to account for the collection of premiums from various City departments related to the amount of workers' compensation policy premium paid and general claims liabilities. Premiums assessed for general claim liabilities are established based on historical claims experience. The City is a member of the Independent Cities Risk Management Authority ("ICRMA"), a joint powers authority formed to provide liability insurance coverage for independent cities. Under the terms of the agreement with the Authority, the City is insured for losses above $250,000 per claim.

A claims liability of $13,077/396 is reported in the Self-Insurance Internal Service Fund at June 30, 2022. Claims are reported if information prior to the issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss can be reasonably estimated.

Claims activities for the two years ended lune 30, 2022 are presented as follows:

Years Ended
Workers' Compensation:

June 30, 2021
June 30, 2022
General Liability:

June 30, 2021
lune 30, 2022
Beginning
Balance
$ 5,292,425
5,054,220
$ 3,497,248
5,717,108
Addition
$ 35,695
1,150,370
$ 2,514,491
2,365,347
Deletion
Ending
Balance
$ (273,900) $ 5,054,220
6, 204, 590
$ (294,631)
(1,209,649)
$ 5,717,108
6,872,806
117
87 739

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(12) Continqencies
The City is presently involved in other matters of litigation that have arisen in the normal course of the City's business. City management believes, based upon consultation with the City Attorney, that these cases, in aggregate, are not expected to have a material adverse financial impact on the City. Additionally, City management believes that sufficient reserves are available to the City to cover any potential losses, should an unfavorable outcome materialize.
(13) Construction Commitments
The following material construction commitments existed at June 30, 2022:

Project Name
Firestone Blvd Median Island-Alameda
Urban Orchard Construction
Tweedy Mile Complete Streets
I-710 Freeway Blvd Southbound
Water System Chlorination Facilities Upgrade
Water Main Replacement Phase I
Gentry General Engineering
(14) Deficit Fund Balances and Net Position
A, Government Wide Financial Statements
Contract
Amount
$ 14,942,278
16,128,863
704,506
1,070,257
3,336,815
232,000
194,500
Expenditures
to date as of
June 30, 2022
$ 13,279,288
8,634,593
80,660
14,259
2,951,780
Remaining
Commitments
$ 812,058
7,494,270
623,846
1 ,055,998
385,035
232,000
194,500
The City's Statement of Net Position shows an unrestricted deficit net position of $81,467,528, resulting mainly from the implementation of GASB Statement No.'s 68 (Pensions) and 75 (OPEB) that required the City to report $60,883,044 in aggregate net pension liability and $30,204,511 in net OPEB liability in the City's financial statements. 118
88 740

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(14) Deficit Fund Balances and Net Position (Continued) B. Fund Financial Statements
The following funds contained a deficit at June 30, 2022:

Funds
Governmental Funds:

Grants Special Revenue
Nonmajor Governmental Funds:

Street Lighting & Landscaping
Used Oil Recycling
Housing Authority Development
SB 2 Grant
LEAP Grant
Internal Service Funds:

Insurance
Fiduciary Funds:

Successor Agency of the Former CDC
Deficit
$ 3,412,580
1 ,389,661
475
134,047
124,356
2 0,528
4,344,662
4,852,221
These deficits will be funded with future revenue or transfers from other funds. The Successor Agency Funds deficit will be eliminated by future property tax revenues. 119
sg
741

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(15) Excess Expenditures over Appropriations
Expenditures for the year ended June 30, 2022, exceeded appropriations at the department or expenditure category level within the following funds:

Fund Appropriations Expenditures Excess
General Fund:

Cityattorney $
Capital outlay
Nonmajor Governmental Funds:

Special Revenue Funds:

Housing Authority
Community development
Law Enforcement Grants
Capital outlay
Asset ForFeiture
Principal retirement
Interest and fiscal charges
Street Sweeping
Public works
Public Access Corporation
General government
Street Lighting & Landscaping
Principal
Measure R
Public works
Measure W
Public works
Used Oil Recycling Program
Public works
Beverage Container Recycling Program
Public works
Emergency Housing Voucher
Community development
1,208,032 $
4,873,484
103,231
146,902
6,376
681,780
18,145
1,147,385
1,910,212 $
64,008
5,243,215
103,555
195,323
8,229
689,897
20, 594
84,971
1,379,943
395,026
34,068
47,147
8,127
(702,180)
(64,008)
(369,731)
(324)
(48,421)
(1,853)
(8,117)
(2,449)
(84,971)
(232, 558)
(395,026)
(34,068)
(47,147)
(8,127)
(16j Successor Aqencv Trust for Assets of Former Community Development Commission On December 29, 2011, the California Supreme Court upheld Assembly Bill IX 26 ("the Bill") that provided for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City of South Gate that previously had reported a redevelopment agency within the reporting entity of the City as a blended component unit.

The Bill provided that upon dissolution of a redevelopment agency, either the City or another unit of local government will agree to serve as the "successor agency" to hold the assets until they are distributed to other units of state and local government. On January 11, 2012, the City Council elected to become the Successor Agency for the former redevelopment agency in accordance with the Bill as part of City resolution number 7473.

After enactment of the law, which occurred on June 28, 2011, redevelopment agencies in the State of California cannot enter into new projects, obligations or commitments. Subject to the 120
go
742

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(16) Successor Aqency Trust for Assets of Former Community Development Commission (Continued)
control of a newly established oversight board, remaining assets can only be used to pay enforceable obligations in existence at the date of dissolution (including the completion of any unfinished projects that were subject to legally enforceable contractual commitments).

In future fiscal years, successor agencies will only be allocated revenue in the amount that is necessary to pay the estimated annual installment payments on enforceable obligations or the former redevelopment agency until all enforceable obligations of the prior redevelopment agency have been paid in full and all assets have been liquidated.

In accordance with the timeline set forth in the Bill (as modified by the California Supreme Court on December 29, 2011) all redevelopment agencies in the State of California were dissolved and ceased to operate as a legal entity as of February 1, 2012.

The Successor Agency to the Former Improvement Agency is reported as a fiduciary fund (private purpose trust fund).

A. Notes and Loans Receivable
On April 5, 1994, the Community Development Commission of the City of South Gate entered into a Disposition and Development Agreement with South Gate Realty Group for the development of certain Real property. South Gate Realty Group owns and operates a housing project located within the boundaries of the South Gate Community Development Commission at 8931 Dudlext Avenue consisting of 20 senior 1-bedroom units. South Gate Realty Group must comply with Housing and Urban Development (HUD) rents for 30 years from the certificate of occupancy date.

The agreement states that 1/30th of the loan amount ($51,222) will be forgiven each fiscal year starting from the occupancy date if South Gate Realty Group can illustrate compliance with the Disposition and Development Agreement (DDA). The DDA limits the rent at $620 per unit less $50 utility allowance for a net of $570 per month or less. The compliance report is required to be submitted to the City each month in order to receive the $51,222 annual forgiveness. At June 30, 2022, the outstanding balance on the loan is $153,656. 121
gi 743

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(16) Successor Aqencv Trust for Assets of Former Community Development Commission (Continued)
B. Capital Assets
The summary of changes in the successor agency's capital assets for the year ended June 30, 2022 is as follows:

Capital assets, not being depreciated:

Land
Total capital assets, not being depreciated
Capital assets, being depreciated:

Structures and improvements
Machinery and equipmnt
Subtotal
Less accumulated depreciation:

Structures and improvements
Machinery and equipment
Subtotal
Total capital assets, being depreciated
Total capital assets, net
C, Long-Term Liabilities
Balance
July 1, 2021
$ 1,686,000 $
1,686,000
381,785
19,359
401,144
(278,381)
(19,359)
(297,740)
103,404
$ 1,789,404 $
Additions Deletions
(19,089)
(19,089)
(19,089)
(19,089) $
Balance
June 30, 2022
$ 1,686,000
1,686,000
381,785
19 359
401,144
(297,470)
(19,359)
(316,829)
84,315
$ 1,770,315
The summary of changes in the successor agency's long-term liabilities for the year ended June 30, 2022, is as follows:

Fiduciary Activities:

Public Offering:

Tax allocation bonds:
2014A Tax Allocation Bonds
Unarnortized premium
2014B Tax Allocation Bonds
Unamortized discount
Total tax allocation bonds
Total
Balance
July 1, 2021
$ 13,590,000
1,559,077
1,690,000
(15,329)
16,823,748
$ 16,823,748
Additions
5,111
5,111
5,111
Deletions
Balance
June 30, 2022
Due within
One Year
$ (3,155,000) $ 10,435,000 $ 3,310,000
(389,769) 1,169,308 79,538
(400,000) 1,290,000 415,000
(10,218) 5,111
(3,944,769) 12,884,090 3,809,649
$ 3,944,769 $ 12,884,090 $ 3,809,649
122
92 744

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(16) Successor Aqency Trust for ASsets of Former Community Development Commission (Continued)
2014 Tax Allocation Revenue Refundinq Bonds
In July 2014, the County of Los Angeles Redevelopment Refunding Authority issued $29,835,000 in 2014 Tax Allocation Revenue Refunding Bonds, Series A, South Gate Redevelopment Project No. 1 with an average interest rate of 4.36'/0 and $3,920,000 in 2014 Tax Allocation Revenue Refunding Bonds, Series B, South Gate Redevelopment Project No. 1 with an average interest rate of 2.65'/o to refund the outstanding balance of the 2002 Certificates of Participation Series A and Series B, the 2002 Tax Allocation Revenue Bonds and the 2003 Tax Allocation Revenue Bonds.

The 2014 Tax Allocation Revenue Bonds, Series A mature in amounts ranging from $2,570,000 kO $3,650,000 W!eil :nterest: rates ranging from 2o/o to 5'/o [hrough September 1, 2024. Interest on the bonds is payable on March 1, 2015 and semi-annually thereafter on September 1 and March 1 of each year.

A reserve account is required to be maintained in an amount equal to the least of: (i) 10'/o of the original aggregate principal amount of the bonds; (ii) 125o/o of average annual debt service; or (iii) maximum annual debt service. As of June 30, 2022, the reserve requirement was $2,983,500 and the balance held in the reserve account was $3,651,813.

The bonds were issued at a premium or $41287,460. At June 30, 2022, the unamortized premium is $1,169/308 and the outstanding balance on the bonds is $10,435/000.

The following schedule summarizes the debt service to maturity requirements for bonds payable outstanding as of June 30, 2022:

Year Ending
June 30, Principal
2023
2024
2025
Total
$ 3,310,000
3,475,000
3,650,000
10,435,000
Interest
439, 000
356,250
182,500
Total
$ 3,749,000
3,831,250
3,832,500
$ 977,750 $ 15,168,375
The 2014 Tax Allocation Revenue Bonds, Series B mature in amounts ranging from $365,000 O $445,000 Wtul !ntereSt rates ranging from .70o/o [0 4'/o through September 1, 2024. Interest on the bonds is payable on March 1, 2015 and semi-annually thereafter on September 1 and March 1 of each year.

A reserve account is required to be maintained in an amount equal to the least of: (i) 10'/o of the original aggregate principal amount of the bonds; (ii) 125o/o of average annual debt service; or (iii) maximum annual debt service. As of ]une 30, 2022, the reserve requirement was $392,000 and the balance held in the reserve account was $450,373. 123
93 745

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(16) Successor Aqency Trust for AssetS of Former Community Development Commission (Continued)
The bonds were issued at a discount of $51,106. At June 30, 2022, the unamortized discount is $10,218 and the outstanding balance on the bonds is $1,290,000.

The net proceeds of $38.0 million of the 2014 Tax Allocation Revenue Refunding Bonds Series A and Series B South Gate Redevelopment Project No. 1 (after a net $4.2 million of bond premium, discount and cost of issuance) and with $15.6 million of amounts released from prior obligations were deposited in an irrevocable trust with an escrow agent to provide for all future debt service payments on the refunded 2002 Certificates of Participation Series A and Series B, the 2002 Tax Allocation Revenue Bonds and the 2003 Tax Allocation Revenue Bonds. As a result, the refunded bonds are considered to be defeased and the liability of the 2002 Certificates of Participation Series A and Series B, the 2002 Tax Allocation Revenue Bonds and the 2003 Tax Allocation Revenue Bonds has been removed from long term debt. The refunding decreased the total debt service payment by $3.1 million over the next 10 years and resulted in an economic gain of $0.8 million.

The following schedule summarizes the debt service to maturity requirements for bonds payable outstanding as of June 30, 2022:

Year Ending
June 30,
2023
2024
2025
Total
Principal
$ 415,000
430,000
445,000
$ 1,290,000 $
D. Commitments and Contingencies
Interest
42,522
26,400
8,900
Total
457,522
456,400
4531900
77,822 $ 1,367,822
On May 13, 1998, the Community Development Commission of the City of South Gate entered into a Disposition and Development Agreement with South Gate Villas, LLC. In accordance with this agreement, a promissory note, dated October 27, 1998, was written whereby South Gate Villas, LLC, would pay the Commission $71030,000. However, subject to certain provisions included in the disposition and development agreement, $243,333 would be forgiven annually for each of the next twenty-nine years. Since the provisions indicated in the disposition and development agreement have been significantly met and the possibility of repayment is remote, no receivable has been reflected. The accounting treatment is in accordance with generally accepted accounting principles.

In addition, the Community Development Commission of the City of South Gate has land held for resale in the amount $1/463,492 which was acquired and recorded at acquisition cost. Due to the downturn of the economic condition of the State and potential sale of the land in the future, the City may record a potential loss due to the fair market of the asset at the time of the sale.
124
94 746

CITY OF SOUTH GATE
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022
(17) Prior Period Adiustments
Net position at July 1, 2021, as previously reported Prior period adjustments:

To restate construction in progress
To restate capital assets and long-temi liabilities To record unearned revenue for ARPA funding
To spilt 2019 bonds between Water & Sewer Funds
Net position at July 1, 2021, as restated
Construction in Proqress
Governmental American Rescue
Activities Plan Act Fund
Water
Fund
Sewer
Fund
Internal Service
Funds
$ 237,359,885 $17,293,527 $ 39,770,128 $ (4,853,849) $ 1,641,370 175,087
(9,922,180)
726,646 -
(17,278,237) (17,278,237)
4,146,288 (4,146,288)
$ 210 886,114 $ 15,290 $43,916,416 i $ 1816,457
As discussed in note 6, the City restated the beginning balance for construction in progress in governmental activities. The restatement was due to a project recorded in CIP in the prior year that is not a City owned capital asset. The City revaluated prior year expenses associated with the I-710 project and determined that $9,922,180 of expenses were not eligible for capitalization.

Capital Assets and Lonq-term Liabilities Governmental Activities As discussed in Note 6 and Note 7, the City restated to increase the beginning balance of capital assets and long-term liabilities for an agreement with Motorola to acquire certain radio equipment. The capital assets and long-term liability was not included in the prior year financial statements in error.

Other Liabilities
The City recorded a prior period adjustment for $17,2781237 to record unearned revenue for the American Rescue Plan Act funding that was received in the prior fiscal year but not earned as of June 30, 2021. The amount was incorrectly recorded as revenue in the prior fiscal year.

Lonq-term Liabilities Enterprise Funds
The South Gate Utility Authority Water Revenue Refunding Bonds Series 2019 ("the 2019 Bonds") is the current debt obligation for the SGUA and are for the sole bond obligation for the water enterprise. However, the 2019 Bonds refunded a portion of the 2012 Bonds, which refunded a portion of the 2001 Bonds. The 2001 Bonds funded $5.875 million in sewer improvements and the sewer enterprise was therefore obligated to pay 20o/o of the 2001 debt service. The 2001 Bond portion of the 2019 Bonds debt service for the Sewer Enterprise is approximately 13.5'/o. As such, a prior period adjustment was made to properly reflect 13.5'/o of the 2019 Water Revenue Bonds as an obligation of the Sewer Fund. 125
gs
747

REQUIRED SUPPLEMENT ARY INFORMATION
126
96 748
This page intentionally left blank.
127
97 749
City of South Gate
Required Supplementary Information
Budgetary Comparison Schedule - General Fund
For the Year Ended June 30, 2022
REVENUES:

Taxes
Licenses and permits
Intergovernmental
Charges for services
Use of money and property (loss)
Fines and forFeitures
Rental
Miscellaneous
Total revenues
EXPENDITURES:

Current:

General government
City Council
City Clerk
City Treasurer
City Attorney
City Manager
Administrative Services
Total general government
Police
Community development
Parks & recreation
Public works
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures

REVENUES OVER
(UNDER) EXPENDITURES

OTHER FINANCING (USES)
Transfers in
Transfers out
Total other financing (uses)
Net change in fund balance
Fund Balance:

Beginning of year
End of year
Budgeted Amounts
Original Final
$ 44,729,073
1 ,757,049
85,500
2,424,700
856,636
1 170 587
2 64,366
4 ,796,090
5 6,084,001
359,191
598,330
37,557
1,208,032
1,235,427
3,586,334
7,024,871
30,770,083
3,371,026
9,916,510
4,943,773
1,395,000
622,039
58,043,302
(1,959,301)
(4,728,750)
(4,728,750)
$ 44,729,073
1 ,757,049
85,500
2,424,700
856,636
1 ,170,587
2 64,366
4 ,796,090
5 6,084,001
359,191
598,330
37,557
1,208,032
1,235,427
3,591,459
7,029,996
30,786,285
3,727,344
9,926,510
5,354,771
1,395,000
622,039
58,841,945
(2,757,944)
(4,737,250)
(4,737,250)
$ (6,688,051) $ (7,495,194)
Actual
Amounts
$ 48,770,618
1 ,623,236
216,631
2,342,111
(783,785)
1,310,097
129,788
4 ,120,074
5 7,728,770
321,283
543,289
36,646
1,910,212
955,798
3,375,241
7,142,469
30,040,630
3,293,625
8,676,195
4,343,329
64,008
1,411,339
624,408
55,596,003
2,132,767
8,787,075
(31,880,830)
(23,093,755)
Variance with
Final Budget
$ 4,041,545
(133,813)
131,131
(82,589)
(1,640,421)
139,510
(134,578)
(676,016)
1,644,769
37,908
55,041
go
(702,180)
279,629
216,218
(112,473)
745,655
433,719
1,250,315
1,011,442
(64,008)
(16,339)
(2,369)
3,245,942
4,890,711
8,787,075
(27,143,580)
(18,356,505)
(20,960,988) $ (13,465,794)
60,364,840
$ 39,403,852
See accompanying Notes to the Juired Supplementary Information. 128
750
City of South Gate
Required Supplementary Information
Budgetary Comparison Schedule - Grants Special Revenue Fund For the Year Ended June 30, 2022
REVENUES:

Intergovernmental
Total revenues
EXPENDITURES:

Current:

Community development
Total expenditures

REVENUES OVER
(UNDER) EXPENDITURES
OTHER FINANCING USES:

Transfers out
Total other financing uses

CHANGE IN FUND BALANCE
FUND BALANCE (DEFICIT):

Beginning of year
End of year
Budgeted Amounts
Oriqinal Final
Actual
Amounts
Variance with
Final Budget
$ 38,846,078
38,846,078
$ 44,284,078
44,284,078
$10,387,142
10,387,142
$ (33,896,936)
(33,896,936)
38,846,078 44,284,078 10,387,142 (33,896,936)
(38,846,078) (44,284,078) (12,540,722) 31,743,356
(38,846,078) (44,284,078) (12,540,722) 31,743,356
$ - $ - (2,153,580) $ (2,153,580)
(1,259,000)
$ (3,412,580)
See accompanying Notes to the Juired Supplementary Information. 129
751
City of South Gate
Required Supplementary Information
Budgetary Comparison Schedule - American Resuce Plan Act Fund For the Year Ended June 30, 2022
REVENUES:

Intergovernmental
Use of money and property (loss)
Total revenues
EXPENDITURES:

Current:

General government
Total expenditures

REVENUES OVER
(UNDER) EXPENDITURES
OTHER FINANCING USES:

Transfers out
Total other financing uses

CHANGE IN FUND BALANCE
FUND BALANCE (DEFICIT):

Beginning of year
End of year
Budgeted Amounts
Original Final
$17,278,236 $ 17,278,236
17,278,236 17,278,236
541,877
541,877
12,759,627
12,759,627
16,736,359 4,518,609
(199,839)
(199,839)
$16,536,520
(8,986,913)
(8,986,913)
$ (4,468,304)
Actual
Amounts
Variance with
Final Budget
$ 9,929,322
66,103
9,995,425
$ (7,348,914)
66,103
(7,282,811)
1,142,113
1,142,113
11,617,514
11,617,514
8,853,312 4,334,703
(8,787,210) 199,703
(8,787,210) 199,703
66,102 $ 4,534,406
15,290
81,392
See accompanying Notes to the R,ired Supplementary Information. 130
752
City of South Gate
Required Supplementary Information
Notes to the Budgetary Comparison Schedules
For the Year Ended June 30, 2022
Budgets and Budgetary Accounting
The City adheres to general procedures in establishing its annual budget, which is reflected in the accompanying budgetary statements and schedules. The annual budget adopted by the City Council provides for the general operations of the City. It includes proposed expenditures and the means of financing them. Budgeted appropriations lapse at the end of the year. The City Council approves total budgeted appropriations and amendments to appropriations throughout the year. The City Council must approve budget transfers between departments, funds and activities, as well as for the use of salary and benefit appropriations for something other than salary and benefits. The departments of the General Fund are considered to be departments for purposes of this requirement. Actual expenditures may not legally exceed budgeted appropriations at the department level. The level of budgetary control (that is, the level at which expenditures cannot legally exceed the appropriated amount at the department level, which is the legal level of control) is established at the department level within each fund.

Annual budgets are adopted for all Governmental Funds on a basis substantially consistent with Generally Accepted Accounting Principles (GAAP). Formal budgetary information is employed as a management control device. Commitments for materials and services, such as purchase orders and contracts are recorded during the year as encumbrances to assist in controlling expenditures. All appropriationslapse at year-end. Encumbrances for open purchase orders and/or ongoing projects or contracts are carried over and are added to the followinq year's budqeted appropriations. 131
101 753
City of South Gate
Required Supplementary Information
Schedule of Changes in Net Pension Liability and Related Ratios For the Year Ended June 30, 2022
Last Ten Fiscal Years
California Public Employees' Retirement System ("CalPERS") Miscellaneous Plan Measurement Period
Service cost
Interest on total pension liability
Changes in assumptions
Differences between expected and actual
experience
Changes in benefit terms
Benefit payments, including refunds of
contributions
Net change in total pension liability
Total pension liability - beginning
Total pension liability - ending (a)
Plan fiduciary net position
Contributions - employer
Contributions - employee
Net investment incomea
Benefit payments
Plan to plan resources movement
Administrative expense
Other Miscellaneous Income/(Expense)
Net change in plan fiduciary net position
Plan fiduciary net position - beginning
Plan fiduciary net position - ending (b)
Net penslon liability - ending (a)-(b)
Plan fiduciary net position as a percentage of the
total pension liability
Covered payrol
Net pension liability as a percentage of covered payroll 2020-21
$ 3,140,084
12,388,906
(601,444)
(7,011,754)
7,915,792
175,808,686
$ 183,724,478
$ 4,879,335
1,142,823
30,325,923
(7,011,754)
(133,709)
29,202,618
133,850,964
$ 163,053,582
2019-20
$ 3,054,995
11,842,099
1,611,093
(6,369,348)
10,138,839
165,669,847
$ 175,808,686
$ 4,439,314
1,242,255
6,383,436
(6,369,348)
(180,923)
5,514,734
128,336,230
$ 133,850,964
2018-19
$ 2,870,032
11,164,341
(1,377,295)
(6,148,296)
6,508,782
159,161,065
$165,669,847
$ 3,679,801
1,242,553
7,937,313
(6,148,296)
(86,856)
282
6,624,797
121,711,433
$128,336,230
$ 20,670,896 $ 41,957,722 $ 37,333,617

88.75o/o 76.13'/a 77.47'/o
$ 16,037,124 $ 15,607,907 $ 15,190,177
128.89'/a 255.04'/a 24S.77%
Notes:

Benefit changes: the figures above do not include any liability impact that may have resulted from plan changes which occurred after June 30, 2017 valuation date. This applies for voluntary benefit changes as well as any offers of Two Years of Additiona Service Credit (a.k.a. Golden Handshakes).

Changes in assumptions: None in 2021, 2020 and 2019. 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.
102 754
City of South Gate
Required Supplementary Information
Schedule of Changes in Net Pension Liability and Related Ratios (Continued) For the Year Ended June 30, 2022
Last Ten FJscal Years
California Public Employees' Retirement System ("CalPERS") Miscellaneous Plan Measurement Period
Service cost
Interest on total pension liability
Changes in assumptions
Differences between expected and actual
experience
Changes in benefit terms
Benefit payments, including refunds of employee
contributions
Net change in total pension liability
Total pension liability - beginning
Total pension liability - ending (a)
2017-18
$ 2,850,621
10,723,300
(532,576)
961,061
(5,927,517)
8,074,889
151,086,176
$159,161,065
2016-17
$2,604,468
10,183,905
9,063,137
(1,443,448)
(5,664,414)
14,743,648
136,342,528
$151,086,176
2015-16
$2,261,496
9,807,665
(1,238,446)
(5,601,315)
5,229,400
131,113,128
$136,342,528
2014-15
$2,160,710
9,431,040
(2,453,625)
(399,523)
(5,359,664)
3,378,938
127,734,190
$131,113,128
2013-141
$ 2,209,895
9,016,106
(5,203,224)
6,022,777
121,711,413
$127,734,190
Plan fiduciary net position
Contributions - employer
Contributions - employee
Net Investment incomea
Benefit payments
Plan to plan resources movement
Administrative expense
Other Miscellaneous Income/(Expense)
Net change in plan fiduciary net position
Plan fiduciary net position - beginning
Plan fiduciary net position - ending (b)
Net pension liability - ending (a)-(b)
Plan fiduciary net position as a percentage of the
total pension liability
Covered payroll
Net pension liability aS a percentage of covered
payroll
$ 3,025,649
1,239,580
9,588,212
(5,927,517)
(282)
(178,114)
(338,242)
7,409,286
114,302,147
$121,711,433
$ 2,807,597
1,119,350
11,577,937
(5,664,414)
936
(154,457)
9,686,949
10 4,615,198
$114,302,147
$ 2,371,025
1,117,889
511,739
(5,601,315)
(254)
(64,773)
(1,665,689)
106,280,887
$104,615,198
$ 1,749,186
1 ,028,703
2,33C1,332
(5,359,664)
(119,756)
4,871
(357,328)
106,638,215
$106,280,887
$ 1,971,806
963,778
xs,g<z,iss
(5,203,224)
13,67 4,516
92,963,699
$ 106,638,215
$ 37,449,632 $ 36,784,029 $ 31,727,330 $ 24,832,241 $ 21,095,975

76.47'!/0 75.65'/0 76.73% 81.06'V0 83.48'V(1
$ 14,926,282 $ 13,777,340 $ 13,452,475 $ 12,677,247 $ 12,254,729 250.90o/a 266.99'Vo 235.85o/o 195.88'!/a 172.15'/a
a Historical information is presented only for periods for which GASB 68 is implemented. The first year of implementation is 2013-14. 133
103 755
City of South Gate
Required Supplementary Information
Schedule of Changes in the Net Pension Liability and Related Ratios (Conttnued) For the Year Ended June 30, 2022
Last Ten Fiscal Years
PARS - Supplemental Retirement Plan
Measurement Period
Service cost
Interest on total pension liability
Differences between expected and actual experience
Changes in assumptions
Benefit payments, including refunds of employee
contributions
Net change in total pension liability
Total pension liability - beginning
Total pension liability - ending (a)
2020-21 2019-20 2018-19
$ 7,560 $ 7,114 $ 6,565
96,992 98,688 94,584
(90,671) (2,071) 62,961
42,502 3,036
(107,996)
(94,115)
1,605,800
$ 1,511,685 $
(103,183)
43,050
1,562,750
1,605,800 $
(97,041)
70,105
1,492,645
1,562,750
Plan fiduciary net position
Contributions - employer
Net investment income
Benefit payments
Administrative expense
Net change in plan fiduciary net position
Plan fiduciary net position - beginning
Plan fiduciary net position - ending (b)
Net pension liability - ending (a)-(b)
Plan fiduciary net position as a percentage of the
total pension liability
Covered payrol
Net pension liability as a percentage of covered payrol $ 49,00 €) $ 96,005 $ 101,362
261,564 35,713 64,637
(107,996) (103,183) (97,041)
(5,830) (5,484) (5,307)
196,738 23,051 63,651
1,139,650 1,116,599 1,052,948
$ 1,336,388 $ 1,139,650 $ 1,116,599
$ 175,297 $ 466,150 $ 446,151

88.40'/o
$ 321,270 $

54.56'!/o

70.97%
321,270 $
145.10%

71.45o/o
312,672
142.69o/a
Notes
Changes in assumptions: None in 2021. In 2020, discount rate changed from 6.50'/o to 6.22'/0. In 2019, discount rate changed from 6.52'Vo to

6.50%. In 2018, diSCOllnt rate changed from 6.75')'o kO 6.52o/o,' payroll grOWtH rake changed from 2.875'!/o O 2.750'/o. 104 756
City of South Gate
Required Supplementary Information
Schedule of Changes in the Net Pension Liability and Related Ratios (Continued) For the Year Ended June 30, 2022
Last Ten Fiscal Years
PARS - Supplemental Retirement Plan
Measurement Period 2017-18 2016-17 2015-16 2014-15 2013-141 Servicecost $ 6,173 $ - $ 9,276 $ 9,006 $ 20,273
Interestontotalpensionliability 97,115 - 95,683 94,489 91,587 Differences between expected and actual experience (29,211) Changesinassumptions 32,997 13,920 - 63,351
Benefit payments, including refunds of employee
contributions (86,425) (85,995) (86,885) (80,278)
Net change in total pension liability 49,860 13,920 18,964 50,750 31,582 Total pension liability - beginning 1,442,785 1,428,865 1,409,901 1,359,151 1,327,569 Total pension liability - ending (a) $ 1,492,645 $ 1,442,785 $ 1,428,865 $ 1,409,901 $ 1,359,151 Plan fiduciary net position
Contributions - employer
Net investment income
Benefit payments
Administrative expense
Net change in plan fiduciary net position
Plan fiduciary net position - beginning
Plan fiduciary net position - ending (b)
Net pension liability - ending (a)-(b)
$ 89,422 $
62,482
(86,425)
(8,712)
56,767
996,181
$ 1,052,948 $
439,697 $
996,181
996,181 $
446,604 $
89,262 $
91,701
(85,995)
(4,851)
90,117
906,064
996,181 $
432,684 $
92,402 $
10,118
(86,885)
(4,517)
11,118
894,946
906,064 $
503,837 $
108,819
18,658
(80,278)
(4,503)
42,696
852,250
894,946
464,205
Plan fiduciary net position as a percentage of the
total pension liability
Coveredpayroll $
Net pension liability as a percentage of covered payrol

70.54%
289,767 $
151.74'!/o

69. 05'/o
282,012 $
158. 36'/0

69.72'!/o
277,966 $
155.66'/0

64.26'/o
260,000 $
193.78'/o

65.85o/o
720,372

64.44'!/0
' Historical information is presented only for periods for which GASB 68 is implemented. The first year of implementation is 2013-14. 135
105 757
City of South Gate
Required Supplementary Information
Schedule of Proportionate Share of the Net Pension Liability and Related Ratios For the Year Ended June 30, 2022
Last Ten Fiscal Years
California Public Employees' Retirement System ("CalPERS") Safety Plan Measurement Period
Proportion of the Net Pension Liability
Proportionate Share of the Net Pension Liability
Covered Payrol
Proportionate Share of the Net Pension Liability as Percentage of Covered Payroll
Plan Fiduciary Net Position as a Percentage of the
Total Pension Liability
2020-21

0.69752o/o
$ 40,036,851
$ 8,592,734
465.94%

78.92%
2019-20

0.53651'/(1
$58,37 4,278
$ 8,357,626
698.46%

68.41'!/a
2018-19

0. 52584"!/a
$ 53,883,494
$ 8,138,937
662.05'/o

70.22'/o
106 758
City of South Gate
Required Supplementary Information
Schedule of Proportionate Share of the Net Pension Liability and Related Ratios (Continued) For the Year Ended June 30, 2022
Last Ten Fiscal Years
California Public Employees' Retirement System ("CalPERS") Safety Plan MeasurementPeriod 2017-18
Proportion of the Net Pension Liability O.52052'!/0 Proportionate Share of the Net Pension Liability $ 50,159,050 CoveredPayroll $ 8,109,044
Proportionate Share of the Net Pension Liability as Percentage of Covered Payroll
Plan Fiduciary Net Position as a Percentage of the
Total Pension Liability 71.l8o/a
6l8.56o/o
2016-17

0.49939'!/o
$ 49,525,601
$ 7,968,440
621.52'/a

70.47o/o
2015-16

0.50255o/o
$43,486,293
$ 7,367,602
590.24"/a

71.79'/o
2014-15

0.49730o/o
$34,133,907
$ 7,077,495
482.29%

77.47%
2013-141

0.46523%
$ 28,948,876
$ 6,919,179
418.39o/a

81.02'/a
' Historical information is presented only for periods for which GASB 68 is implemented. The first year of implementation is 2013-14. 137
107 759
City of South Gate
Required Supplementary Information
Schedule of Contributions - Pensions
For the Year Ended June 30, 2022
Last Ten Fiscal Years
California Public Employees' Retirement System ("CalPERS") Miscellaneous Fiscal year 2021-22 2020-21 2019-20 2018-19
Actuarially determined contribution $ 5,234,731 $ 4,018,442 $ 4,439,314 $ 3,679,801 Contributions in relation to the actuarially
determined contributions (5,234,731) (4,018,442) (4,439,314) (3,679,801) Contribution deficiency (excess) $ - $ - $ - $
Covered payroll 2 $17,709,348 $16,037,124 $ 15,607,907 $ 15,190,177 Contributions as a percentage
2 Of covered payroll 29.56'/o 25.06'/o 28.44o/o 24.22o/a 2 Covered Payroll represented above is based on pensionable earnings provided by the employer.

Notes to Schedule
Valuation date:

The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2021-22 were from the June 30, 2019 public agency valuations.

Methods and assumptions used to determine contribution rates:

Actuarial cost method Entry Age Normal
Amortization method/period Level percentage of payroll Asset valuation method Market value
Inflation 2.50'!/o
Salary increases Varies by entry age and service
Payrollgrowth 2.75o/o
Investment rate of return 7.OC)'!/o, net of pension plan investment and administrative expenses, including inflation
Retirement age The probabilities of retirement are based on the 2017 CalPERS Experience study for the period from 1997 to 2015.

Mortality The probabilities of mortality are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. Pre- retirement and Post-retirement mortality rates include 15 years of projected mortality improvement using 90"/o of Scale MP-2016 published by the Society of Actuaries. 138
108 760
City of South Gate
Required Supplementary Information
Schedule of Contributions - Pensions (Continued)
For the Year Ended June 30, 2022
Last Ten Fiscal Years
California Public Employees' Retirement System ("CalPERS") Miscellaneous Fiscal year 2017-18 2016-17 2015-16 2014-15 2013-141 Actuarially determined contribution $ 3,025,649 $ 2,807,597 $ 2,371,025 $ 1,901,745 $ 1,819,247 Contributions in relation to the actuarially
determined contributions (3,025,649) (2,807,597) (2,371,025) (1,901,745) (1,819,247) Contribution deficiency (excess) $ - $ - $ - $ - $
Covered payroll 2 $ 14,926,282 $13,777,340 $ 13,452,475 $ 12,677,247 $ 12,254,729 Contributions as a percentage of
2 COvered payroll 20.27o/o 20.38'!/o 17.63'/o 15.00o/o 14.85o/o 1 Historical information is presented only for periods for which GASB 68 is implemented. The first year of implementation is 2 013-14.
139
iog 761
City of South Gate
Required Supplementary Information
Schedule of Contributions - Pensions (Continued)
For the Year Ended June 30, 2022
Last Ten Fiscal Years
California Public Employees' Retirement System ("CalPERS") Safety Fiscal year 2021-22 2020-21 2019-20 2018-19 2017-IS Actuarially determined contribution $ 6,175,454 $ 4,902,949 $ 4,902,949 $ 4,957,802 $4,399,729 Contributions in relation to the
actuarially determined contributions (6,175,454) (4,902,949) (4,902,949) (4,957,802) (4,399,729) Contribution deficiency (excess) $ - $ - $ - $ - $
Covered payroll 2 $12,341,610 $ 8,592,734 $ 8,357,626 $ 8,138,937 $8,109,044 Contributions as a percentage
2 ofcovered payroll 50.04o/o 57.06o/o 57.06'/o 59.28o/o 54.06'/0 2 Covered Payroll represented above is based on pensionable earnings provided by the employer.

Notes to Schedule
Valuation date:

The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2021-22 were from the lune 30, 2019 public agency valuations.

Methods and assumptions used to determine contribution rates:

Actuarial cost method Entry Age Normal
Amortization method/period Level percentage of payroll Asset valuation method Market value
Inflation 2.50o/o
Salary increases Varies by entry age and service
Payrollgrowth 2.75o/o

7.00'/o, net of pension plan investment and administrative expenses, including Investment rate of return inflation
Retirement age The probabilities of retirement are based on the 2017 CalPERS Experience study for the period from 1997 to 2015.

Mortality The probabilities of mortality are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. Pre- retirement and Post-retirement mortality rates include 15 years of projected mortality improvement using 90o/o of Scale MP-2016 published by the Society of Actuaries. 140
110 762
City of South Gate
Required Supplementary Information
Schedule of Contributions - Pensions (Continued)
For the Year Ended June 30, 2022
Last Ten Fiscal Years
California Public Employees' Retirement System ("CalPERS") Safety Fiscal year 2016-17 2015-16 2014-15 2013-141
Actuarially determined contribution $ 3,802,971 $ 3,802,971 $ 3,000,801 $ 2,086,240 Contributions in relation to the actuarially
determined contributions (3,802,971) (3,802,971) (3,000,801) (2,086,240) Contribution deficiency (excess) $ - $ - $ - $
Covered payroll 2 $ 7,968,440 $ 7,367,602 $ 7,077,495 $ 6,919,179 Contributions as a percentage
2 Of covered payroll 46.90'/o 47.73'/o 40.73'/0 29.48'!/ €1 ' Historical information is presented only for periods for which GASB 68 is implemented. The First year of implementation is 2013-14.
ill 763
City of South Gate
Required Supplementary Information
Schedule of Contributions - Pensions (Continued)
For the Year Ended June 30, 2022
Last Ten Fiscal Years
PARS - Supplemental Retirement Plan
Fiscal year 2021-22 2020-21 2019-20 2018-19
Actuarially determined contribution $114,778 $ 109,307 $ 92,251 $ 71,442 Contributions in relation to the actuarially
determined contributions (93,404) (96,005) (101,362) (89,422) Contribution deficiency (excess) $ 21,374 $ 13,302 $ (9,111) $ (17,980) Covered payroll $ 142,716 $ 321,270 $ 312,672 $ 289,767 Contributions as a percentage
of covered payrol 65.45'!/o 29.88% 32.42% 30.86'!/o
Notes to Schedule
Valuation date: June 30, 2021
Methods and assumptions used to determine contribution rates:

Actuarial cost method Entry Age Normal
Amortization method/period Closed period, level percent of pay Asset valuation method Fair market value
Inflation 2.75'/o
Salary increases Varies by entry age and service
Cost of living adjustment 5.90o/o based on 2021 SSA OASDI report

6.22'/o
Investment rate of return
Retirement age Consistent with Non-Industrial rates used to value the Miscellaneous CalPERS Pension Plans.

Mortality Consistent with Non{ndustrial rates used to value the Miscellaneous CalPERS Pension Plans.
142
112 764
City of South Gate
Required Supplementary Information
Schedule of Contributions - Pensions (Continued)
For the Year Ended June 30, 2022
Last Ten Fiscal Years
PARS - Supplemental Retirement Plan
Fiscal year
Actuarially determined contribution
Contributions in relation to the actuarially
determined contributions
Contribution deficiency (excess)
Covered payrol
Contributions as a percentage
of covered payroll
2017-18 2016-17 2015-16 2014-IS 2013-14 '
(3,073) $ 65,461 $ 61,230 $ 89,000 $ 84,594
(89,262) (92,402) (108,819) (144,907)
(3,073) $ (23,801) $ (31,172) $ (19,819) $ (60,313) $ 282,012 $ 282,012 $ 277,966 $ 260,000 $ 720,372

0.00'!/o 31.65'!/o 33.24o/o 41.85'!/o 20.12'!/o
' Historical information is presented only for periods for which GASB 68 is implemented. The first year of implementation is 2013-14.
143
113
765
City of South Gate
Required Supplementary Information
Schedule of Changes in Net Other Postemployment Benefits Liability and Related Ratios For the Year Ended June 30, 2022
Last Ten Fiscal Years
Measurement Period
Service cost
Interest on total OPEB liability
Differences between expected and actual experience
Changes in assumptions
Implicit Subsidy Credit
Benefit payments, including refunds of employee contributions Net change in total OPEB liability
Total OPEB liability - beginning
Total OPEB liability - ending (a)
2020-21
$ 1,342,086
731,487
(3,057,982)
3,139,649
(216,510)
(714,004)
1,224,726
28,979,785
$ 30,204,511
2019-20
$ 1,093,910
809,810
(89,563)
2,719,276
(190,665)
(473,890)
3,868,878
25,110,907
$ 28,C)79,785
2018-19
$ 1,094,006
1,147,746
(6,638,431)
(652,631)
(902,892)
(5,952,202)
31,063,109
$ 25,110,907
2017-18 2016-171
$ 1,102,741 $ 1,071,923
1,064,551 1,036,683
(1,503,666)
(526,077) 650,700
(83 4,408)
806,807
30,256,302
$ 31,063,109
(799,760)
455,880
29,800,422
$ 30,256,302
Plan fiduciary net posi5on
Contributions - employer
Contributions - employee
Net investment income
Benefit payments
Recognized difference in proportion
Plan to plan resources movement
Administrative expense
Net change in plan fiduciary net position
Plan fiduciary net position - beginning
Plan fiduciary net position - ending (b)
$ 836,126 $ 473,890 $ 902,892 $ 834,408 $ 799,760
(836,126) (473,890) (902,892) (834,408) (799,760)
Net OPEB liability - ending (a)-(b) $30,204,511 $28,979,785 $25,110,907 $31,063,109 $30,256,302 Plan fiduciary net position as a percentage of the
total OPEB liability
Covered-employee payroll
Net OPEB liability as a percentage of covered-employee payroll O.OO"l"o O.00'/o O.OOo/o O.00'!/o a.(X)'Vo
$23,961,037 $23,319,744 $22,695,615 $20,739,803 $20,184,723 126. 06'/o 120. 88'/o 110. 64'/o 149. 78')'0 149. 9 0'/o ' Historical informa5on is presented only for periods for which GASB 75 is implemented. The first year of implementation is 2016-17.

The City has not established a trust for the purpose of holding assets accumulated for plan benefits. 144
114 766
City of South Gate
Required Supplementary Information
Schedule of Contributions - Other Postemployment Benefits For the Year Ended June 30, 2022
Fiscal year
Actuarially determined contribution
Contributions in relation to the actuarially
Contribution deficiency (excess)
Last Ten Fiscal Years
2021-22
836.126
(836,126)
2020-21 201C1-20
$ 752,739 $ 752,739
(930,513) (664,556)
! (177,774) $ 88,183
2018-19
(902,892)
2017-18
834.408
834.408
2016-17
799 760
799 .760
Covered-employee payroll a $ 23,242,786 $ 23,961,037 $23,319,744 $ 22,695,615 $20,739,803 $20,184,723 Contributions as a percentage of covered payroll 3.60'Vo 3.88"/0 2.85"/0 3.98% 4.02% 3.96% ' Historical information is presented only for periods for which GASB 75 is implemented. The first year of implementation is 2016-17. a Payroll from prior year was assumed to increase by the 2.75% payroll growth assumption.

Notes to Schedule
Valuation date: ]une 30, 2021
Methods and assumptions used to determine contribution rates:

Actuarial cost method Entry Age Normal
DiscountRate l.92o/o
Inflation 5.50"/o
Healthcare Cost Trend Rate 6.00'!/0 trending down to 4.04o/o over 54 years Salaryincreases 2.75'!/o
Retirement age
Mortality
According to the retirement rates under the most recent CalPERS pension plan experience study.

According to the mortality rates under the CalPERS pension plan updated to reflect the most recent experience study
115 767
This page intentionally left blank.
146
116
768

SUPPLEMENT ARY INFORMATION
147
117
769
City of South Gate
Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Capital Improvement Projects Fund
For the Year Ended June 30, 2022
REVENUES:

Intergovernmental
Total revenues
EXPENDITURES:

Capital outlay
Total expenditures

REVENUES OVER
(UNDER) EXPENDITURES
OTHER FINANCING SOURCES (USES):

Transfers in
Transfers out
Total other financing sources (uses)

CHANGE IN FUND BALANCE
FUND BALANCE:

Beginning of year
End of year
Budgeted Amounts Actual
Original Final Amounts
69,535,722
69,535,722
74,719,314
74,719,314
17 038 461
17 038 461
Variance with
Final Budget
57,680,853
57,680,853
(69,535,722) (74,719,314) (17,038,461) 57,680,853
65,341,409 71,090,409
65,341t409 71,090,409
$ (4,194,313) $ (3,628,905)
18,313,205
(8,000)
18,305,205
1,266,744
3,712,778
$ 4,979,522
(52,777,204)
8,000
(52,777,204)
$ 4,903,649
148
118 770
This page intentionally left blank.
149
iig 771

NON-MAJOR

GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS:

Community Development Block Grant Fund - This fund accounts for revenues received from the u.s.

Department of Housing and Urban Development for housing rehabilitation and other community Housing Authority Fund - This fund is used to account for revenues from the u.s. Department of Housing and Urban Development for housing assistance (Section 8) payments to eligible participants.

HOME Program Fund - This fund accounts for revenues received from the u.s. Department of Housing and Urban Development's Affordable Housing program to assist low income households.

Housing Successor Fund
Development Commission.

This fund accounts for the housing assets of the former Community Law Enforcement Grants Fund - This fund accounts for revenues received From federal, state and local law enforcement grants to be used for public safety.

Asset Forfeiture Fund - This fund accounts for revenues received from asset seizures which can only be used to augment law enforcement expenditures.

Air Quality Improvement Fund - This fund accounts for local revenue received from the South Coast Air Quality Management District to be used for clean air programs.

Traffic Safety Fund - This fund accounts for traffic safety programs funded by moving vehicle violations collected by the County court system and remitted to the City.

Gas Tax Fund - This fund accounts for gas tax and other transportation revenues received from the State for construction and maintenance of streets and roads.

Street Sweeping Fund - This fund accounts for street sweeping fees used to fund the City's street sweeping and storm drain maintenance.

Prop A Transit Fund - To account for revenues received from a one-half cent sa.les tax collected by L.A.

County Metro and distributed to cities for use in transportation service and transportation-related Prop C Transit Fund - This fund accounts for revenues received from a one-half cent sales tax collected by L.A. County Metro and distributed to cities for use in street improvement projects along major bus UDAG Fund - This fund accounts for former Urban Development Assistance Grant funds (UDAG) that the City uses for community development projects.

Public Access Corporation Fund - This fund accounts for revenues previously received from the City's cable television operator through a franchise agreement. This nonprofit corporation was established to promote community access through media.
150
120 772

NON-MAJOR

GOVERNMENT AL FUNDS
SPECIAL REVENUE FUNDS (Continued):

Street Lighting & Landscaping Fund - This fund accounts for revenues received through a citywide street lighting assessment for street lighting and traffic signal maintenance.

Measure R Transit Fund - This fund accounts for revenues received from a one-half cent sales tax collected by L.A. County Metro and distributed to cities for use in transportation, street and road improvements.

Road Repair & Accountability Act Fund - This fund accounts for revenues received from the 12 cent gasoline tax, 20 cent diesel fuel tax, and $100 vehicle registration tax collected by the State of California, Department of Transportation and distributed to Cities for the purpose oF repairing roads, improving traffic safety, and expanding public transit systems across the state.

Measure M Transit Fund - This fund accounts for revenues received from a 1/2 cent sales tax collected by L.A. County Metro and distributed to cities for use in transportation, street and road improvement projects.

Park Enhancement Fund - This fund accounts for revenues received from the lease of the goal soccer and batting cage facilities, cell tower, and other sources collected by the City for use in park improvement projects.

CASp Fund - This fund accounts for revenues received under the SB 1186 ($1) and the SB 1379 ($4) State legislation that assesses a fee when business licenses and equivalent permits are issued or renewed. The CASp program is designed to meet the public's need for experienced, trained, and tested individuals (Certified Access Specialists) who can inspect buildings and sites for compliance with applicable state and federal construction standards.

Measure W Stormwater - This fund accounts for revenues generated from Measure W is used to for regional and municipal projects that improve water quality, prepare for future drought, and provide community benefits such as parks or wetlands. The City uses funds for storm water projects in compliance with the MS4 permit.

Used Oil Recycling Program - This fund is to account for the revenue derived from oil recycling grants awarded by the CalRecycle.

Beverage Container Recycling ?rogram - The California Department of Resources Recycling and Recovery (CalRecycle) administers the California Beverage Container Recycling and Litter Reduction Act which governs the recycling of California Redemption Value (CRV) beverage containers. The primary goal of the recycling program is to achieve an 80o/o recycling rate for all aluminum, glass, plastic, and bi-metal Road Mitigation Program Fund - These are funds derived from an impact fee placed upon new development as a way to mitigate the developments impact to the wear and tear upon city streets.

Housing Authority - Development Projects - This fund is to account for acquisition of new development properties use for housing projects.

Emergency Housing Voucher (EHV) - This fund is to account for the HUD grant allocations specific to assisting emergency housing needs. It is a housing voucher program to assist for emergency housing for 151
121 773

NON-MAJOR

GOVERNMENT AL FUNDS
SPECIAL REVENUE FUNDS (Continued):

SB 2 Grant Fund - This fund is to account for SB 2 allocations from the state in addressing housing shortage, high housing costs, and supply of affordable homes within City limits.

LEAP Grant - This fund is to account for the LEAP grant revenues to assist with availability of affordable homes and ending the homelessness.
152
122 774
City of South Gate
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2022
ASSETS
Cash and investments
Receivables:

Accounts
Loans
Interest
Leases
Prepaid items
Due from other governments
Due from other funds
Land held for resale
Total assets

LIABILITIES AND FUND BALANCES
Liabilities:

Accounts payable
Accrued payroll and related liabilities
Unearned revenue
Deposits
Due to other funds
Advances from other funds
Total liabilities
Deferred inflows of resources:

Leases
Unavailable revenues
Total deferred inflows of resources
Fund Balances:

Nonspendable
Restricted
Unassigned (deficit)
Total fund balances
Total liabilities and fund balances
Special Revenue
Community
Development
Block Grant
1484 792
474,378
HOusing
Authority
HOME
Program
Housing
Successor
Law
Enforcement
Grants
$535,497 $ 532,487 $ 126,021 $ 333,284
6,076
14,415
542
6,258,572
13,916
1,434
43,130
2,030
648,677
336
4,958
613
52,108
3,150,000
$1,959,170 $571,880 $6,834,189 $3,932,022
$ 123,596
4,288
132,431
$ 8,585
15,121
365,069
625,384
193,224
216,930
1,333,786 354,950
1,333,786
$1,959,170
354,950
$571,880
$ 4,239 $ 26,040
248
313,435
23,054
317,922
6,516,267
6,516,267
$ 6,834,189
49,094
4,835
1,664
6,499
3,876,429
3,876,429
$ 3,932,022
$-
6,818
379,187
379,187
$ =386005
(Continued)
153
123 775
City of South Gate
Combining Balance Sheet (Continued)
Nonmajor Governmental Funds
June 30, 2022
Special Revenue
ASSETS
Cash and investments
Receivables:

Accounts
Loans
Interest
Leases
Prepaid items
Due from other governments
Due from other funds
Land held for resale
Total assets

LIABILITIES AND FUND BALANCES
Liabilities:

Accounts payable
Accrued payroll and related liabilities
Unearned revenue
Deposits
Due to other funds
Advances from other funds
Total liabilitieS
Deferred inflows of resources:

Leases
Unavailable revenues
Total deferred inflows of resources
Fund Bplances:

Nonspendable
Restricted
Unassigned (deficit)
Total fund balances
Total liabilities and fund balances
Asset
Forfeiture
Air Quality
Improvement
Traffic
Safety Gas Tax
Street
Sweeping
$2,606,035 $ 431,387 $ 31,151 $1,584,079 $ 469,608
4,442 827
14,822
337 132 728
1,755 729
171,740
$2,625,299 $ 432,214 $ 31,151 $1,757,911
$ 61,352 $
2,044
63,396
2,561,903
2,561,903
$2,625,299
705
431,509
431,509
$ 432,214
705 $ $ 78,620
12,210
74,293
$ 60,573
1,190
165 123
31,151
31,151
$ 31,151
1,592,788
1,592,788
$1,757,911
541,302
(Continued)
154
124 776
City of South Gate
Combining Balance Sheet (Continued)
Nonmajor Governmental Funds
June 30, 2022
ASSETS
Cash and investments
Receivables:

Accounts
Loans
Interest
Leases
Prepaid items
Due from other governments
Due from other funds
Land held for resale
Total assets

LIABILITIES AND FUND BALANCES
Liabilities:

Accounts payable
Accrued payroll and related liabilities
Unearned revenue
Deposits
Due to other funds
Advances from other funds
Total liabilities
Deferred inflows of resources:

Leases
Unavailable revenues
Total deferred inflows of resources
Fund Balances:

Nonspendable
Restricted
Unassigned (deficit)
Total fund balances
Total liabilities and fund balances
Special Revenue
Prop A
Transit
Prop C
Transit UDAG
Public
Access
Corporation
Street Lighting
& Landscaping
$ 4,541,894 $ 4,547,073 $ 407,263 $ 18,204 $
is,gsg 9,856
5,876
35 ,006
36 8,134
$ 4,950,910
8,935
25,000
255,858
576
$ 4,836,866 $ 407,839 $ 34,187 $
58,125
67 981
$ 158,463 $ 74,076 $
4,076
124,200
15,263
248,832 38,544 1,318,179
411,371 112,620 1,457,642
35,006
4,504,533
4,539,539
$ 4,950,910
4,724,246
4,724,246
$ 4,836,866
407,839 34,187
407,839 34,187
$ 407,839 $ 34,187
(1,389,661)
(1,389,661)
$ 67,981
(Continued)
155
125 777
City of South Gate
Combining Balance Sheet (Continued)
Nonmajor Governmental Funds
June 30, 2022
Special Revenue
Measure R
Transit
Road Repair &
Accountability
Act
Measure M
Transit
Park
Enhancement CASp
ASSETS
Cash and investments
Receivables :

Accounts
Loans
Interest
Leases
Prepaid items
Due from other governments
Due from other funds
Land held for resale
Total assets
$ 3,922,891 $ 4,842,654 $ 3,367,940 $1,086,524 $ 75,774 6,267 6,364 4,161 1,432
3,789
791,305
322,886
$ 4,724,252 $ 5,171,904 $ 3,372,101 $1,087,956 $ 75,866

LIABILITIES AND FUND BALANCES
Liabilities:

Accounts payable $
Accrued payroll and related liabilities
Unearned revenue
Deposits
Due to other funds
Advances from other funds
19,731 $
39,443
7,026
$ 88,779 $
1,224
791,305
Total liabilities 66,200 881,308
Deferred inflows of resources:

Leases
Unavailable revenues
Total deferred inflows of resources
2,407
2,407
Fund Balances:

Nonspendable
Restricted
Unassigned (deficit)
Total fund balances
Total liabilities and fund balances
4,658,052 5,171,904
4,658,052 5,171,904
$ 4,724,252 $ 5,171,904
2,490,793
2,490,793
$ 3,372,101
1,085,549
1,085,549
$1,087,956
75,866
75,866
$ 75,866
156
126 778
City of South Gate
Combining Balance Sheet (Continued)
Nonmajor Governmental Funds
June 30, 2022
ASSETS
Cash and investments
Receivables:

Accounts
Loans
Interest
Leases
Prepaid items
Due from other governments
Due from other funds
Land held for resale
Total assets

LIABILITIES AND FUND BALANCES
Liabilities:

Accounts payable
Accrued payroll and related liabilities
Unearned revenue
Deposits
Due to other funds
Advances from other funds
Total liabilities
Deferred inflows of resources:

Leases
Unavailable revenues
Total deferred inflows of resources
Fund Balances:

Nonspendable
Restricted
Unassigned (deficit)
Total fund balances
Total liabilities and fund balances
Measure W
Stormwater
Special Revenue
Beverage
Container
Used Oil Recycling Recycling
Program Program
Road Mitigation
Program
Housing
Authority
Development
$1,050,679 $ 1,996 $ 61,953 $ 2,080,307 $
1,367 24 71 2,921
$ 1,052,046 $
1,800,000
2,020 $ 62,024 $ 2,083,228 $ 1,800,000
$ 60,865 $ 2,495 $ 18,081 $ 9 181
60,865 2,495 18,081
111,866
1,813,000
1,934,047
991,181 43,943 2,083,228
991,181
$1,052,046 $
(475)
(475)
2,020
43,943
$ 62,024
2,083,228
$ 2,083,228
(134,047)
(134,047)
$ 1,800,000
157
127 779
City of South Gate
Combining Balance Sheet (Continued)
Nonmajor Governmental Funds
June 30, 2022
ASSETS
Cash and investments
Receivables:

Accounts
Loans
Interest
Leases
Prepaid items
Due from other governments
Due from other funds
Land held for resale
Total assets

LIABILITIES AND FUND BALANCES
Liabilities:

Accounts payable
Accrued payroll and related liabilities
Unearned revenue
Deposits
Due to other funds
Advances from other funds
Total liabilities
Deferred inflows of resources:

Leases
Unavailable revenues
Total deferred inflows of resources
Fund Balances:

Nonspendable
Restricted
Unassigned (deficit)
Total fund balances
Total liabilities and fund balances
Special Revenue
Emergency
Housing Voucher
SB 2
Grant
LEAP
Grant
TotaI
Nonmajor
Governmental
Funds
256,745 $ $ 32,911,446
256,745 $
166,986
8,406,456
47,354
4,958
35,006
1,179,894
1,416,731
4,950,000
$ 49,118,831
8,127 $ 5,518 $ 1,970
118,838 18,558
8,127 124,356 20,528
935,196
101,925
520 159
23,054
3,211,441
1,813,000
6,604,775
59,500
sg,soo
4,835
63,571
68,406
189,118
189,118
256,745
124 356
124 356
(20,528)
(20,528)
35,006
44,079,711
(1,669,067)
42,445,650
$ 49,118,831
(Concjuded)
158
128 780
City of South Gate
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds
For the Year Ended June 30, 2022
Community
Development
Block Grant
Housing
Authority
REVENUES:

Taxes
Licenses and permits
Intergovernmental
Charges for services
Use of money and property
Rental
Miscellaneous
1,634,045
30,000
5,110,692
(2,637)
Total revenues 1,664,045 5,108,055
EXPENDITURES:

Current:

General government
Police
Community development
Parks & recreation
Public works
Capital outlay
Debt service:

Principal
Interest and fiscal charges
1,434,606 5,243,215
Total expenditures 1,434,606 5,243,215

REVENUES OVER
(UNDER) EXPENDITURES 229,439 (135,160)
OTHER FINANCING SOURCES (USES):

Proceeds from lease
Transfers in
Transfers out
Total other financing sources (uses)
(265,352)
(265,352)
CHANG.ES IN FUND BALAIVCES (35,913) (135,160)
FUND BALANCES:

Beginning of year
End of year
1,369,699
$ 1,333,786
490 110
$ 354,950
Special Revenue
HOME
Program
43,130
870
44,000
126,900
126,900
(82,900)
83,772
83,772
872
6,515,395
$ 6,516,267
Housing
Successor
88,150
88,150
67,728
67,728
20,422
20,422
3,856,007
$ 3,876,429
Law
Enforcement
Grants
384,725
(12,415)
441,026
103,555
544 581
(172,271)
(172,271)
551,458
$%379,187
159
129 781
City of South Gate
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Nonmajor Governmental Funds
For the Year Ended June 30, 2022
Special Revenue
Asset
Forfeiture
Air Quality
Improvement
REVENUES:

Taxes
Licenses and permits
Intergovernmental
Charges for services
Use of money and property
Rental
Miscellaneous
Total revenues
EXPENDITURES:

Current:

General government
Police
Community development
Parks & recreation
Public works
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures
188,578 91,424
(92,566) (16,379)
96,012
735,427
6,386
267,842
195,323
8,229
1,206,821
71,144
77 530

REVENUES OVER
(UNDER) EXPENDITURES (1,110,809) (2,485)
OTHER FINANCING SOURCES (USES):

Proceeds from lease
Transfers in
Transfers out
Total other financing sources (uses)

CHANGES IN FUND BALANCES
FUND BALANCES:

Beginning of year
End of year
30,306
(11,004)
19,302
(1,091,507)
3,653,410
$ 2,561,903
(180,000)
(180,000)
(182,485)
613,994
$ ,431509
Traffic
Safety
1,263,273
1,263,273
1,263,273
(1,232,122)
$ 31,151
Gas Tax
Street
Sweeping
2,250,408
(30,335)
685,161
(14,808)
2,220,073 670 353
1 154 904 689,897
1 154 904
1065 169 (19,544)
(7,680)
(7,680)
1057 489 (19,544)
535,299
$ 1,592,788
560,846
$ %541,302
160
130 782
City of South Gate
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Nonmajor Governmental Funds
For the Year Ended June 30, 2022
Special Revenue
Prop A
Transit
Prop C
Transit UDAG
Public
ACCeSS
Corporation
Street Lighting
& Landscaping
REVENUES:

Taxes $ 2,001,775
Licenses and permits
Intergovernmental
Charges for services
Use of money and property
Rental
Miscellaneous
Total revenues
2,673,505
80,827
(84,728)
2,031,907
(175,192) (11,616)
42,740
(512)
8,788
2,678,392 1,856,715 (11,616) 42,228 2,001,775
EXPENDITURES:

Current:

General government
Police
Community development
Parks & recreation
Public works
Capital outlay
Debt service:

Principal
Interest and fiscal charges
1,694,144
439,700
20,594
2,157,617
84,971
Total expenditures 1694 144 439 700 20,594 2,242,588

REVENUES OVER
(UNDER) EXPENDITURES 984,248 1,417,015 (11,616) 21,634 (240,813) OTHER FINANCING SOURCES (USES):

Proceeds from lease
Transfers in
Transfers out
Total other financing sources (uses)
(2,534,973)
(2,534,973)
CHANGES IN FUND BALANCES 984,248 (1,117,958) (11,616) 21,634 (240,813) FUND BALANCES:

Beginning of year
End of year
3,555,291
$ 4,539,539
5,842,204
$ 4,724,246
419,455
$ 407,839
12,553
$ 34,187
(1,148,848)
$ (1,389,661)
161
131 783
City of South Gate
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Nonmajor Governmental Funds
For the Year Ended June 30, 2022
Measure R
Transit
Road Repair &
Accountability
Act
REVENUES:

Taxes
Licenses and permits
Intergovernmental
Charges for services
Use of money and property
Rental
Miscellaneous
1,523,685
(130,643)
1,925,088
(123,052)
Total revenues 1,393,042 1,802,036
EXPENDITURES:

Current:

General government
Police
Community development
Parks & recreation
Public works
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures
1,379,943
1,379,943

REVENUES OVER
(UNDER) EXPENDITURES 13,099 1,802,036
OTHER FINANCING SOURCES (USES):

Proceeds from lease
Transfers in
Transfers out
Total other financing sources (uses)
(216,604)
(216,604)
(578,784)
(578,784)
CHANGES IN FUND BALANCES (203,505) 1,223,252
FUND BALANCES:

Beginning of year
End of year
4,861,557
$4,658,052
3,948,652
$ 5,171,904
Special Revenue
Measure M
Transit
1,724,225
(80,058)
1,644,167
1,381,202
1,381,202
262,965
8,000
(224,888)
(216,888)
46,077
2,444,716
$ 2,490,793
Park
Enhancement
278,782
(28,026)
250,756
101,005
101,005
149,751
(3,604)
(3,604)
146,147
939,402
$ 1,085,549
CASp
$-
14,633
(1,802)
12,831
12,831
63,035
$ u75866
162
132 784
City of South Gate
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Nonmajor Governmental Funds
For the Year Ended June 30, 2022
Special Revenue
Beverage Container
Measure W sed Oil Recyclin Recycling Road Mitigation Stormwater Program Program Program
Housing
Authority
Development
REVENUES:

Taxes
Licenses and permits
Intergovernmental
Charges for services
Use of money and property
Rental
Miscellaneous
991,744
(24,626)
13,202
(412)
24,140
(1,247)
27,860
(51,154)
Total revenues 967,118 12,790 22,893 (23,294)
EXPENDITURES:

Current:

General government
Police
Community development
Parks & recreation
Public works
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures
395,026
395,026
34 068
34 068
47,147
47,147
52,144
52,144

REVENUES OVER
(UNDER) EXPENDITURES 572,092 (21,278) (24,254) (23,294) (52,144) OTHER FINANCING SOURCES (USES):

Issuance of debt
Transfers in
Transfersout (218,738)
Total other financing sources (uses) (218,738)
CHANGES IN FUND BALANCES 353,354 (21,278) (24,254) (23,294) (52,144) FUND BALANCES:

Beginning of year
End of year
637,827
$991,181
20,803
$ (475)
68,197
$ 43,943
2,106,522
$ 2,083,228
(81,903)
$ (134,047)
163
133 785
City of South Gate
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued) Nonmajor Governmental Funds
For the Year Ended June 30, 2022
REVENUES:

Taxes
Licenses and permits
Intergovernmental
Charges for services
Use of money and property
Rental
Miscellaneous
Total revenues
EXPENDITURES :

Current:

General government
Police
Community development
Parks & recreation
Public works
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures

REVENUES OVER
(UNDER) EXPENDITURES
OTHER FINANCING SOURCES (USES):

Issuance of debt
Transfers in
Transfers out
Total other financing sources (uses)

CHANGES IN FUND BALANCES
FUND BALANCES:

Beginning of year
End of year
Special Revenue
Emergency
Housing Voucher
SB 2
Grant
LEAP
Grant
Total
Nonmajor
Governmental
Funds
183,645
$ 2,001,775
42,493
20 794 143
1,117,510
(793,188)
183,645
8,788
23,171,521
8,127 108,172 is ggo
20,594
1,176,453
8,757,412
101,005
7,679,504
442,541
8,127 108,172 is ggo
280,294
8,229
18 466 032
175,518 (108,172) (is,ggo) 4,705,489
30,306
1,355,045
(4,241,627)
(2,856,276)
175,518 (108,172) (is,ggo) 1,849,213
13,600
$ 189,118
(16,184)
$ (124,356)
(4,538)
$ (20,528)
40,596,437
$ 42,445,650
164
134 786
City of South Gate
Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Community Development Block Grant Special Revenue Fund For the Year Ended June 30, 2022
Budgeted Amounts
Oriqinal Final
Actual
Amounts
Variance with
Final Budget
REVENuES:

Intergovernmental
Charges for services
Total revenues
$ 2,170,852 $ 2,170,852
2,170,852 2,170,852
$ 1,634,045
30,000
1,664,045
$ (536,807)
30,000
(506,807)
EXPENDITURES:

Current:

Community development
Total expenditures
508,713
508,713
2,043,846
2,043,846
1,434,606
1,434,606
609,240
609,240

REVENUES OVER
(UNDER) EXPENDITURES 1,662,139 127,006 229,439 102,433 OTHER FINANCING (USES):

Transfers out
Total other financing sources (uses)

CHANGE IN FUND BALANCE
(1,662,139)
(1,662,139)
(1,662,139)
(1,662,139)
$ (1,535,133)
(265,352) 1,396,787
(265,352) 1,39.6,787
(35,913) $ 1,499,220
FUND BALANCE:

Beginning of year
End of year
1,369,699
$ 1,333,786
165
135 787
City of South Gate
Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Housing Authority Special Revenue Fund
For the Year Ended June 30, 2022
Budgeted Amounts Actual
Original Final Amounts
Variance with
Final Budget
REVENUES:

Intergovernmental
Use of money and property
Total revenues
$ 5,214,700
5,6C)0
5,220,300
$ 5,214,700
5,600
5,220,300
$ 5,110,692
(2,63")
5,108,055
$ (104,008)
(8,237)
(112,245)
EXPENDITURES:

Current:

Community development
Total expenditures
4,873,484
4,873,484
4,873,484
4,873,484
5,243,215
5,243,215
(369,731)
(369,731)
CHANGE IN FUND BALANCE 346,816 $ 346,816 (135,160) $ (481,976) FUND BALANCE:

Beginning of year
End of year
490,110
$ 354,950
166
136
788
City of South Gate
Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual HOME Program Special Revenue Fund
For the Year Ended June 30, 2022
Budgeted Amounts Actual
Oriqinal Final Amounts
Variance with
Final Budget
REVENUES:

Intergovernmental
Use of money and property
Total revenues
$ 2,506,133 $ 2,506,133 $
2,506,133 2,506,133
43 ,130
870
44 ,000
$ (2,463,003)
870
(2,462,133)
EXPENDITURES:

Current:

Community development
Total expenditures
2,606,133
2,606,133
2,613,933
2,613,933
126,900
126,900
2,487,033
2,487,033

REVENUES OVER
(UNDER) EXPENDITURES (100,000) (107,800) (82,900) 24,900 OTHER FINANCING SOURCES (USES):

Transfers in
Total other financing sources (uses)
100,000
100,000
100,000
100,000
83,772
83,772
(16,228)
(16,228)
CHANGE IN FUND BALANCE (7,800) 872 $ 8,672
FUND BALANCE:

Beginning of year
End of year
6,515,395
$ 6,516,267
167
137 789
City of South Gate
Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Housing Successor Special Revenue Fund
For the Year Ended June 30, 2022
Budgeted Amounts Actual
Original Final Amounts
Variance with
Final Budget
REVENuES:

Use of money and property
Rental
Total revenues
64,238 $ 64,238 $ 88,150 $ 23,912
64,238 64,238 88,150 23i912
EXPENDITURES:

Current:

Community development
Total expenditures
165,819
165,819
165,819
165,819
67,728
67,728
98,091
98,091

REVENUES OVER
(UNDER) EXPENDITURES

CHANGE IN FUND BALANCE
(101,581)
$ (101,581) $
(1 €)1,581)
(101,581)
20,422 122,003
20,422 $ 122,003
FUND BALANCE:

Beginning of year
End of year
3,856,007
$ 3,876,429
168
138 790
City of South Gate
Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Law Enforcement Grants Special Revenue Fund
For the Year Ended June 30, 2022
Budgeted Amounts Actual
Oriqinal Final Amounts
Variance with
Final Budget
REVENUES:

Intergovernmental
Use of money and property
Total revenues
415,495 $
3,700
4 19,195
468,495 $
3 ,700
4 72,195
384,725 $
(12,415)
372,310
(83,770)
(16,115)
(99,885)
EXPENDITURES:

Current:

Police
Capital outlay
Total expenditures
415,495
415,495
498,446
103,231
601,677
441,026
103,555
544,581
57,420
(324)
57,096
CHANGE IN FUND BALANCE 3,700 $ (129,482) (172,271) $ (42,789) FUND BALANCE:

Beginning of year
End of year
551,458
$ 379,187
169
139 791
City of South Gate
Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Asset Forfeiture Special Revenue Fund
For the Year Ended June 30, 2022
Budgeted Amounts
Oriqinal Final
Actual
Amounts
Variance with
Final Budget
REVENUES:

Intergovernmental
Use of money and property
Total revenues
$ 830,000 $
33,700
863,700
830,000 $
33,700
863,700
188,578 $
(92,566)
96,012
(641,422)
(126,266)
(767,688)
EXPENDITURES:

Current:

Police
Capital outlay
Debt service:

Principal retirement
Interest and fiscal charges
Total expenditures
1,041,281
300,732
1,054,512
427,050
735,427
267,842
319,085
159,208
146,902
6,376
1,495,291
146,902
6,376
1,634,840
195,323
8,229
1,206,821
(48,421)
(1,853)
428,019

REVENUES OVER
(UNDER) EXPENDITURES (631,591) (771,140) (1,110,809) (339,669) OTHER FINANCING (USES):

Issuance of debt
Transfers out
Total other financing (uses)

CHANGE IN FUND BALANCE
(40,477) (40,477)
(40,477) (40,477)
$ (672,068) $ (811,617)
30,306
(11,004)
19,302
30,306
29,473
59,779
(1,091,507) $ (279,890)
FUND BALANCE:

Beginning of year
End of year
3,653,410
$ 2,561,C)03
170
140 792
City of South Gate
Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Air Quality Improvement Special Revenue Fund
For the Year Ended June 30, 2022
Budgeted Amounts
Oriqinal Final
Actual
Amounts
Variance with
Final Budget
REVENUES:

Intergovernmental
Use of money and property
Total revenues
125,938 $
3,200
129,138
125,938 $
3,200
129,138
91,424 $
(16,379)
75,045
(34,514)
(19,579)
(54,093)
EXPENDITURES:

Current:

Community development
Capital outlay
Total expenditures
12,914
335,209
348,123
12,914
324,650
337,564
6 ,386
71,144
77,530
6,528
253,506
260,034

REVENUES OVER
(UNDER) EXPENDITURES (218,985) (208,426) (2,485) 205,941 OTHER FINANCING (USES):

Transfers out
Total other financing (uses)
(180,000)
(180,000)
(180,000)
(180,000)
CHANGE IN FUND BALANCE $ (218,985) $ (388,426) (182,485) $ 205,941 FUND BALANCE:

Beginning of year
End of year
613,994
$ 431,509
171
141 793
City of South Gate
Schedules of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual Traffic Safety Special Revenue Fund
For the Year Ended June 30, 2022
Budgeted Amounts
Oriqinal Final
Actual
Amounts
Variance with
Final Budget
REVENUES: