City Council and Concurrent Authorities
February 7, 2023

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ATTACHMENT A

ATTACHMENT A

CITY OF STOCKTON, CALIFORNIA

ANNUAL COMPREHENSIVE

FINANCIAL REPORT

WITH REPORT ON FINANCIAL STATEMENTS

BY INDEPENDENT

CERTIFIED PUBLIC ACCOUNTANTS

FOR THE YEAR ENDED
JUNE 30, 2022

Prepared by:

Administrative Services Department

Kimberly Trammel
Chief Financial Officer

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ATTACHMENT A
City of Stockton
Annual Comprehensive Financial Report
For the Year Ended June 30, 2022

Table of Contents

i
Page

INTRODUCTORY SECTION (Unaudited)

Table of Contents ............................................................................................................................................................ i Letter of Transmittal ...................................................................................................................................................... v City Council .................................................................................................................................................................. xi Organizational Chart/Principal Officials .................................................................................................................... xii

FINANCIAL SECTION

Independent Auditors’ Report on the Financial Statements ................................................................................... 1

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

Basic Financial Statements:

Government-Wide Financial Statements:

Statement of Net Position ............................................................................................................................... 17 Statement of Activities ....................................................................................................... ............................ 18

Fund Financial Statements:

Governmental Fund Financial Statements:

Balance Sheet ........................................................................................................................................... 22 Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position ......................................................................... 23 Statement of Revenues, Expenditures, and
Changes in Fund Balances ................................................................................................................. 24 Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Government-Wide Statement of Activities ...................................................................................................................... 25

Proprietary Fund Financial Statements:

Statement of Net Position ......................................................................................................................... 28 Statement of Revenues, Expenses, and Changes in Net Position ............................................................ 32 Statement of Cash Flows .......................................................................................................................... 34

Fiduciary Fund Financial Statements:

Statement of Fiduciary Net Position ........................................................................................................ 40 Statement of Changes in Fiduciary Net Position ................................................................................ ..... 41

Notes to the Basic Financial Statements ............................................................................................................ 45

ATTACHMENT A
City of Stockton
Annual Comprehensive Financial Report
For the Year Ended June 30, 2022

Table of Contents (Continued)

ii
Page
FINANCIAL SECTION (Continued)

Required Supplementary Information (Unaudited)

Budget Process ................................................................................................................................................... 109

Budget Basis of Accounting .............................................................................................................................. 110

Budgetary Comparison Schedule:

General Fund ................................................................................................................................................ 112 CDBG, NSP Housing Grants Special Revenue Fund ................................................................................... 114 Special Grants Special Revenue Fund .......................................................................................................... 115

Schedule of Changes in Net Pension Liability and Related Ratios California Public Employees’ Retirement System Defined Benefit Plan ..................................................... 116 California Public Employees' Retirement System ("CalPERS") - Safety Plan ............................................ 118 PARS Enhancement Plan ............................................................................................................................. 120

Schedule of Contributions - Pensions:

California Public Employees’ Retirement System Defined Benefit Plan ..................................................... 122 California Public Employees' Retirement System ("CalPERS") - Safety Plan ............................................ 124 PARS Enhancement Plan ............................................................................................................................. 126

Supplementary Information:

Nonmajor Governmental Funds:

Combining Balance Sheet ....................................................................................................... ..................... 131 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances .................................... 134

Internal Service Funds:

Combining Statement of Net Position .......................................................................................................... 138 Combining Statement of Revenue, Expenses, and Changes in Net Position ............................................... 140 Combining Statement of Cash Flows ........................................................................................................... 142

Custodial Funds:

Combining Statement of Net Position .......................................................................................................... 148 Combining Statement of Changes in Fiduciary Net Position ....................................................................... 149

Schedule of Sources and Uses – Measure A and B ......................................................................................... 150

ATTACHMENT A
City of Stockton
Annual Comprehensive Financial Report
For the Year Ended June 30, 2022

Table of Contents (Continued)

iii
Page
STATISTICAL SECTION (Unaudited)

Statistical Section Overview .............................................................................................................................. ..... 151

Financial Trends:

Net Position by Classification ............................................................................................................................. 152 Changes in Net Position ...................................................................................................................................... 154 Fund Balance, Governmental Funds ................................................................................................................... 158 Changes in Fund Balance of Governmental Funds ............................................................................................. 160 Tax Revenues by Source, Governmental Funds ................................................................................................. 164

Revenue Capacity:

Assessed Value and Estimated Actual Value of Taxable Property ..................................................................... 166 Direct and Overlapping Property Tax Rates ....................................................................................................... 168 Principal Property Taxpayers .............................................................................................................................. 169 Secured Property Tax Levies and Collections .................................................................................................... 170 Water Sold by Customer Type ............................................................................................................................ 171 Water and Wastewater Utility Rates ................................................................................................................... 173

Debt Capacity:

Ratios of Outstanding Debt by Type ................................................................................................................... 174 Ratios of General Bonded Debt Outstanding ...................................................................................................... 176 Direct and Overlapping Governmental Activities Debt ...................................................................................... 177 Legal Debt Margin Information .......................................................................................................................... 178 Pledged-Revenue Coverage ................................................................................................................................ 180

Demographic and Economic Information:

Demographic and Economic Statistics ............................................................................................................... 183 Principal Employers ........................................................................................................................................... 184

Operating Information:

Full-Time City Employees by Function .............................................................................................................. 185 Operating Indicators by Function ........................................................................................................................ 186 Capital Assets Statistics by Function/Program/Department ............................................................................... 189

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ATTACHMENT A
v
January 31, 2023
To the Honorable Mayor,
City Council, A
udit Committee and the
Citizens of the City of Stockton, California
The Stockton City Charter, federal grant regulations, and agreements with i nvestors require the City of Stockton, California ("City") to publish a complete set of financial statements presented in conformance with Generally Accepted Accounting Principles ("GAAP") and audited by a firm of licensed, certified p ublic accountants. Under those requirements, we respectfully submit the Annual Comprehensive Financial Report ("ACFR") of the City of Stockton for the fiscal year ("FY") ended June 30, 2022.

Responsibility for the accuracy of the presented data and the completeness and fairness of the presentation, including all disclosures, rests with the City. To the best of our knowledge, the data, as presented, is accurate in all material aspects; and is presented in a manner designed to fairly set forth the financial position and results of operations of the City as measured by the financial activity of its various funds. This report contains all disclosures necessary to enable the reader to fully understand the City's financial affairs.

An overview of the City's financial activities for the fiscal year is discussed in detail in the Management's Discussion and Analysis ("MD&A") section of the ACFR.

PROFILE OF THE GOVERNMENT
The City of Stockton is located in the center of California's San Joaquin Valley and is the seat of San Joaquin County.

Stockton is located about 80 miles east of the San Francisco Bay Area and 40 miles south of Sacramento, California's Capitol.

One of the oldest cities in the State of California, Stockton was founded in 1849 and incorporated in 1850. In 1888, the voters approved Stockton's first local Charter, whi ch was ratified by the State Legislature in 1889. The current Charter was approved by the voters in November 1922 and became effective in 1923. This Charter changed the City from a commission form of government to the current City Council-City Manager form of government. Under the Council-Manager form of government, the City Council has policy-making and legislative authority. Representatives from six districts are chosen by district election, with the Mayor being chosen by citywide election, for staggered four-year terms, with a two-term limit. The City Manager is responsible for carrying out the City Council's policies and ordinances, appointing department heads, and overseeing the City’s operations. The City Council appoints the City Manager, City Attorney, City Auditor, and City Clerk.

The City Charter has been amended many times since 1922, with the most recent amendments approved by voters in November 2016. Those amendments eliminated city-wide voting for Council districts, modified the Mayor's compensation, powers, and duties, and made several changes related to budget and fiscal affairs.

The City provides a full range of municipal services, including police and fire protection, community development, economic development, affordable housing, public works and st reet maintenance, parks, recreational services, libraries, and water, wastewater, and stormwater utilities. The City serves approximately 55% of water accounts in the City while the California Water Service Company, an investor-owned company, provides water service to 42%, and San Joaquin

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County provides water service to the remaining 3%.

This report includes the Stockton Public Financing Authority's financial activity, a separate legal entity controlled by the City. The City reports the Successor Agency to the Redevelopment Agency of the City of Stockton's financial statements as a private-purpose trust fund in these financial statements.

The Council is required to adopt an annual budget following a public hearing to review the proposed annual budget. This annual budget serves as the foundation for the City's financial planning and control. The City prepares the budget by fund, function, and department, e.g., Police. Department heads may transfer budget appropriations within a department as they see fit. Transfers between General Fund departments, however, need City Council approval. Outside the General Fund, the City Manager has the authority to transfer budget appropriations at the fund level.

THE LOCAL ECONOMY
The City encompasses nearly 65 square miles, is surrounded by the San Joaquin Valley's fertile lands and is home to the furthest inland deep-wate
r seaport in California. The City has a well-diversified economic base that has evolved from its agricultural roots to become a regional center for commerce, including the second-largest transportation and logistics hub in the United States. In addition to the Port of Stockton, the City is equipped with a regional airport, a Burlington Northern Santa Fe intermodal facility, and interstate freeways. The University of the Pacific, California State University-Stanislaus- Stockton campus, Humphries College, and San Joaquin Delta Community College are all located in Stockton. Four school districts serve K-12 students within City limits.

In January 2022, Stockton's population was 322,489, according to the California Department of Finance, which represents a 0.52% increase over last year's population of 320,804. The California Department of Finance also projects the San Joaquin County population will continue to increase at a rate of approximately 1.11% and 1.13% in 2023 and 2024, respectively. As the 11th largest city in California, Stockton is comparable in size to other cities such as Lexington, St.

Paul, Newark, and Orlando.

According to the California Employment Development Department, the unemployment rate in Stockton has decreased by approximately 4.6% between July 1, 2021 to July 1,2022, from 10.3% to 5.7%. Per the Bureau of Labor Statistics, the national unemployment rate has decreased 1.9% (from 5.4% to 3.5%) for the same period.

According to Redfin, the Stockton housing market is likely to decrease over the next year. As of June 2022, the median home value in Stockton was approximately $469,000 which is an increase of 9.1% over the previous year of $430,000; however, this represents a halt in the rise of home values.

FINANCIAL CONDITION HIGHLIGHTS
Financial results for the year compare favorably with budget estimates in most areas of the City's operations. For the General Fund, financial result s fo
r the year were better than estimated. Expenditures (including encumbrances and carryovers and other uses of funds) came in 6.5% under budget. Revenues (including other sources of funds) were 18.7% above budget estimates. As a result, the General Fund bala nce at June 30, 2022 (excluding related funds) of $98 million was combined with prior year reserve funds of $34 million for a total of $132 million available to fund reserves. Of the available balance, $113.3 million was allocated to reserves: $47.2 million to the Working Capital operating reserve, $55.3 million the known contingencies reserves, and the risk-based reserve category was increased to $10.8 million. Portions of the balance were also committed to the IRS Section 115 Pension trust ($10 million), future contingent creditor payments ($3.6 million), and one-time Council priority projects ($5.7 million).

The City Council has a reserve policy that calls for the City to maintain a 17% operating reserve and establishes additional reserves for known contingencies, unforeseen revenue changes, infrastructure failures, and catastrophic events. Additionally, the policy sets an automatic process to deposit one-time revenue increases and expenditure savings into the reserves. These policies are consistent with the Government Finance Officers' Association (GFOA) best practice recommendations and Governmental Accounting and Standards Board (GASB) guidance.

The Statement of Net Position (revenues and sources of funds less expenses and uses of funds) for the City is approximately $1.8 billion. The City's net position is roughly $216.7 million higher, or 13.8%, than the prior fiscal year, with most of the growth in Governmental Activities.

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The City's Long-Range Financial Plan

The City maintains a comprehensive and detailed 20-year Long-Range Financial Plan ("L-RFP"), which provides a long- term forecast for the City's General Fund and other funds' impacts on the General Fund. The L-RFP is a vital tool and reflects the City's commitment to fiscal health and sustainability. This financial model is used to evaluate the immediate impact of budgetary decisions and the ongoing costs of those decisions over multiple years. The L-RFP was developed as part of the City's bankruptcy exit plan, or Plan of Adjustment, which included certain assumptions and agreements reached with creditors. Since its development, the L-RFP has become a dynamic tool that is updated based on current revenue and expenditure trends. Though the individual variables and assumptions may change over time, the L-RFP provides a consistent model to forecast the City's fiscal position.

A summary of the L-RFP is available on the City's website:

http://www.stocktonca.gov/government/departments/adminservices/budLrfp.html

For a more detailed analysis of the financial performance of the City, refer to the Management's Discussion and Analysis sections titled Financial Analysis of the City's Funds and General Fund Budgetary Highlights.

The City's Irrevocable Post-Employment Benefits Trust

On November 7, 2017, the City created an irrevocable post-employment benefits trust program, also known as an Internal Revenue Code Section 115 trust (Trust). This Trust is designed to pre-fund pension costs and to offset GASB 68 net pension liabilities. The ending balance in the trust as of June 30, 2022 was $69.9 million ($62.6 million General Fund) .

The Trust allows the City to set aside funds through a tax-exempt funding mechanism to mitigate long-term contribution rate volatility. The Trust will enable the City to control the assets and when the City utilizes them. Also, the statutory investment restrictions that apply to the City's investment portfolio do not apply to assets held in a post-employment benefits trust. The City will strive to accrue an amount in the Trust sufficient to fund annual CalPERS costs during economic downturns or other periods when annual revenues are forecast to be insufficient.

Access to the Financial Markets

The City has no long-term bonds backed by the General Fund. The last rating actions on the City's General Fund-backed debt was a Standard & Poor upgrade to "BB", with a continuing positive outlook in August 2018. In April 2019, Moody's issued an upgrade for the City's General Fund of "A3", from "Baa1". The City’s Wastewater utility maintained ratings of "A" by Standard & Poors and “A+” by Fitch. In 2022, both Standard & Poors and Fitch re-affirmed the City’s Water debt ratings of “A” and “AA-”, respectively. The Parking Revenue Bonds are currently rated at BBB- after revenues declined during the COVID pandemic shutdowns.

The City does not anticipate issuing any bonds backed by the General Fund. However, the City does plan on incurring additional debt through various funding sources over the next several years to upgrade its wastewater facilities, including the renovation of the Regional Wastewater Control Facility (RWCF). The City is in the process of completing a $46.8 million draw on a low-interest loan through the California Clean Water State Revolving Fund (CWSRF) program, and anticipates receipt of funds in spring 2023.

In addition, there may also be a need to issue land-based debt to support residential and industrial/commercial development.

RESERVE POLICIES

The City's General Fund reserve policy calls for the City to maintain a 17% operating reserve (approximately two months of expenditures) and establishes additional reserves for known contingencies, unforeseen revenue changes, infrastructure failures, and catastrophic events. The known contingencies include amounts to address staff recruitment and retention, prefund future CalPERS costs, replace public safety radio infrastructure and the City's financial system, and relocate many City operations to the Waterfront Towers location. The Ci ty’s Governmental Funds reported a combined ending fund balance of $607.1 million at the close of June 30, 2022, an increase of $101.4 million compared with the prior fiscal year.

The General Fund balance in this report, as of June 30, 2022, was $178.6 million without encumbrances. Included in this fund balance and under the guidance of the Reserve and Fund Balance Policy – General Fund (excluding related funds), Council took action to fully fund the priority one working capital reserve at $47.2 million, fully fund known contingency reserves at $55.3 million, and increased the risk-based reserves to $10.8 million.

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The policy establishes an automatic process to deposit one-time revenue increases and expenditure savings into the reserves. These policies are consistent with GFOA's best practice recommendations and GASB guidance.

The reserve policy is available on the City's website at:

http://www.stocktonca.gov/files/General_Fund_Reserve_Policy.pdf

DEBT POLICY AND ANNUAL CONTINUING DISCLOSURES

The City's debt policy is available on its website as follows:

http://www.stocktonca.gov/files/Capital_Financing_Debt_Management_Policy.pdf

The City's annual financial disclosures are available on the Municipal Securities Rulemaking Board's and Electronic Municipal Market Access website at http://emma.msrb.org.

INVESTMENT POLICY

The City adopts an investment policy annually that provides guidelines for the prudent investment of the City's cash balances. The City contracts with Public Financial Management for the day-to-day management of the City's long- term investment portfolio. The Administrative Services Department oversees both the City's long-term investment portfolio management and liquid
cash requirements. The City's investment policy is posted on the City's website:

http://www.stocktonca.gov/files/Investment_Policy_Final_080817.pdf

CASH AND INVESTMENTS

The California Government Code and the City's investment policy adopted in compliance with that Code define how the City can invest its cash. The City's policy also outlines the principles for maximizing the City's cash management operations' efficiency while meeting the daily cash flow demands of the City. The average overall return rate on funds not held by fiscal agents for the fiscal year ending June 30, 2022, was 3.26%. This amount includes both realized and unrealized gains distributed to funds. Absent unrealized Fair Market Value gains and Accrued Interest amounts distributed on June 30, 2022, distributed returns would have been 0.99%.

Additional information on the City's cash and investment management can be found in Notes 1 and 2 in the notes to the financial statements.

GENERALLY ACCEPTED ACCOUNTING PRINCIPLES

The GASB establishes GAAP for local and state governments in the United States and Canada. Its counterpart for
private-sector entities is the Financial Accounting Standard Board. The American Institute of Certified Public Accountants and state and federal regulators require that financial reports follow GAAP to receive an unmodified audit opinion. The GFOA and the California Committee on Municipal Accounting entail additional standards that govern disclosures in the ACFR.

GAAP requires management to provide a narrative overview and analysis discussing the City's financial position to accompany the basic financial statements. This narrative overview is called Management's Discussion and Analysis (MD&A), which provides an analytical overview of the City's financial position for its significant funds, as defined by GAAP, on a government-wide basis. This letter of transmittal is intended to complement the MD&A and not to duplicate the MD&A. It provides additional qualitative information on impacts to the City to help improve the reader's understanding of the data presented in the ACFR.

The City's ACFR conforms to the requirements established by GAAP, the City's Charter, GFOA standards, and agreements with investors. The ACFR includes basic financial statements, footnotes, supplemental information required by GASB for GAAP financial reports, MD&A of the financial statements, the City's independent auditor's opinion regarding the

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conformance of the financial statements with GAAP, and other information required to conform to GFOA standards.

INDEPENDENT AUDIT

The City Charter, Article XIX, Section 1911, states: "after the cl ose of the fiscal year, an annual audit shall be made of the City's funds. Such audit shall be made by a firm of independent certified public accountants." The Pun Group, LLP, an independent firm of licensed, certified public accountants, has audited the City of Stockton's financial statements.

The purpose of the independent audit is to obtain reasonable assurance that the City's financial statements are free of material misstatement and are fairly presented in conformity with GAAP. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation.

The independent auditors issued an unmodified opinion for the fiscal year ended June 30, 2022.

SINGLE AUDIT REPORT TO FEDERAL GRANTING AGENCIES

A broader, federally- mandated "Single Audit," designed to meet federal granting agencies' needs, is also required.

The standards governing Single Audit engagements require the independent auditor to report on the fair presentation of the financial statements and the audited government's internal controls and compliance with legal requirements, emphasizing internal controls and legal requirements involving the administration of federal awards.

The City prepares a separate single audit report in conformity with the Federal Single Audit Act's provisions as amended and U.S. Office of Management and Budget Uniform Guidance, "Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards." This report is filed with the federal clearinghouse on or before March 31 each year.

RISK MANAGEMENT

During FY 2021-22, the City continued its self-insurance program for General Liability, Property, and Workers' Compensation. The City is a member of the California Joint Powers Risk Management Authority for General Liability and All Risks Property Program, which is primarily underwritten by various insurance companies. The Property All Risks coverage is up to $400 million per occurrence with a $250,000 deductible. The self-insured retention ("SIR") for General Liability is $1.25 million. The City is also a member of the Public Risk Innovation, Solutions and Management insurance pool for excess Workers' Compensation coverage. The SIR is $500,000.

INTERNAL CONTROLS AND LIMITATIONS

The ACFR intends to provide the City Council and the public with an understanding of the City's financial position.

City management assumes responsibility for the completeness, accuracy, and reliability of the information presented in this report. City management established an internal control framework intended to protect the City's assets from loss, theft, or misuse and to compile sufficient, reliable information for the preparation of the City's financial statements.

The City's comprehensive system of internal controls continues to be the subject of an ongoing review to ensure the timeliness and accuracy of the ACFR, and improve management reporting and controls. The City's Finance team, along with the City's Internal Auditor (Moss Adams LLP) continue s to work together to close out prior audit findings and continually improve the City's key controls, systems, and policies and procedures.

Budgetary control is at the department level for the General Fund and the fund level for all other funds. Transfers within funds and like categories of the same department require City Manager approval. Revisions to increase appropriation authority above a department's original adopted budget require City Council approval.

ATTACHMENT A

ACKNOWLEDGEMENTS
This report would not have been possible without the dedicated professionals in the Administrative Services Department and employees' cooperation from tlu·oughout the City who provided detailed information and other support and assistance.

We also want to thank the Mayor, City Council, and the Audit Committee for your interest and support in planning and conducting the City's financial operations responsibly and sustainably.

Respectfully submitted,
���
KIMB�MMEL --=

CHIEF FINANCIAL OFFICER
x

ATTACHMENT A

KIMBERLEY WARMSLEY
COUNCILMEMBER
District6
KEVIN J. LINCOLN II
MAYOR

CITY OF STOCKTON

CITY COUNCIL

SOL JOBRACK
COUNCILMEMBER
District1

CHRISTINA FUGAZI
VICEMAYOR
District5


DAN WRIGHT
COUNCILMEMBER
District2

PAUL CANEPA
COUNCILMEMBER
District3

SUSAN LENZ
COUNCILMEMBER
District4
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ATTACHMENT A

CITY OF STOCKTON

ORGANIZATION CHART
AS OF JUNE 30, 2022

CITIZENS OF STOCKTON

CITY COUNCIL
Mayor KEVIN LINCOLN
Vice Mayor CHRISTINA FUGAZI, District 5
Councilmember SOL JOBRACK, District 1
Councilmember DAN WRIGHT, District 2
Councilmember PAUL CANEPA, District 3
Councilmember SUSAN LENZ, District 4
Councilmember KIMBERLY WARMSLEY, District 6
Acting City Attorney

LORI ASUNCION
Acting City Attorney

LORI ASUNCION
City Clerk

ELIZA GARZA
City Clerk

ELIZA GARZA
City Manager

HARRY BLACK
City Manager

HARRY BLACK
City Auditor

MOSS ADAMS, LLP
City Auditor

MOSS ADAMS, LLP
Community
Services
Community
Services
Community
Development
Community
Development
Deputy City Manager IIDeputy City Manager IIDeputy City Manager IDeputy City Manager I Deputy City Manager IIDeputy City Manager II Economic
Development
Economic
Development
Municipal
Utilities
Municipal
Utilities
Public WorksPublic Works
Administrative
Services
Administrative
Services
Human
Resources
Human
Resources
Information
Technology
Information
Technology
PolicePolice
Office of
Violence
Prevention
Office of
Violence
Prevention Office of
Performance
and Data
Analytics
Office of
Performance
and Data
Analytics
FireFire
xii

ATTACHMENT A

FINANCIAL SECTION

ATTACHMENT A

ATTACHMENT A
200 E. Sandpointe Avenue, Suite 600
Santa Ana, California 92707
INDEPENDENT AUDITORS’ REPORT
To the Honorable Mayor and the Members of the City Council of the City of Stockton
Stockton, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Stockton, California (the “City”), as of and for the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City as of June 30, 2022 and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to fi nancial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States. Our responsibilities under tho se standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements 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 obtai ned is sufficient and appropriate to provide a basis for our audit opinions.

Emphasis of Matter
Change in Accounting Principle
As discussed in Note 1X to the financial statements , the City adopted new accounting guidance, Governmental Accounting Standard Board (“GASB”) Statement No. 87, Leases. Our opinion is not modified with respect to this matter.

Prior Period Adjustments
As discussed in Note 19 to the basic financial statements, the City recorded restatements due to GASB 87, Leases implementation for the governmental activities and business-type activities in the amount of $1,602,826 and $45,199, respectively. In addition, the City also recorded a prior period adjustment in the Successor Agency fund in the amount of $1,868,468 to due correction of the cash with fiscal agent. Our opinion is not modified with respect to this matter.

ATTACHMENT A
To the Honorable Mayor and the Members of the City Council of the City of Stockton
Stockton, California

2 Responsibilities of Management for the Financial Statements

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

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

Auditors’ Responsibilities for the Audit of the Financial Statements

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

Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with the auditing standard s generally accepted in the United States of America and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the ove rride of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

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

 Exercise professional judgment and maintain professional skepticism throughout the audit.

 Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to t hose 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 purpo se 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.

ATTACHMENT A
To the Honorable Mayor and the Members of the City Council of the City of Stockton
Stockton, California

3 Required Supplementary Information

Accounting principles generally accepted in the United Stat es of America require that the Management’s Discussion and Analysis, budgetary comparison inform ation, and the Schedule of Changes in Net Pension Liability and Related Ratios, and the Schedule of Contributions - Pensions as listed in the table of contents be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial 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 appropria te operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and compar ing the information for cons istency 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.

Supplementary Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The accompanying comb ining and individual nonmajor fund financial statements and the schedule of sources and uses – Measure A and B are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements.

The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial statements and the schedule of sources and uses – Measure A and B are fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Information

Management is responsible for the othe r information included in the annual repor t. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditors’ report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.

In connection with our audit of the basi c financial statements, our responsibility is to read the other information and consider whether a material inconsistenc y exists between the other information and the basic financial statements, or the other information otherwise appears to be materially 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.

ATTACHMENT A
To the Honorable Mayor and the Members of the City Council of the City of Stockton
Stockton, California

4 Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards , we have also issued our report dated January 30, 2023, on our consideration of the City’s internal control over financia l reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.

Santa Ana, California
January 30, 2023

ATTACHMENT A

MANAGEMENT'S DISCUSSION AND ANALYSIS

ATTACHMENT A

ATTACHMENT A

5 MANAGEMENT’S DISCUSSION AND ANALYSIS

UNAUDITED

JUNE 30, 2022

INTRODUCTION

As management of the City of Stockton (“City”), we offer readers of the City’s financial statements this overview and analysis of the City’s financial activities for the fiscal year ended June 30, 2022. We encourage readers to consider the information presented here in conjunction with the accompanying Transmittal Letter, the Basic Financial Statements, and the Notes to the Fina ncial Statements. All amounts, unless otherwise indicated, are expressed in thousands of dollars.

FINANCIAL HIGHLIGHTS

Government-wide:
 The City’s total net position for the governmental and business-type activities show that, as of June 30, 2022, total assets and deferred outflow of resources exceeded its liabilities and deferred inflow of resources by $1.78 billion. Of this amount, $29.3 million represen ts the unrestricted net position, $549.8 million is restricted for City's ongoing obligation related to programs with external restrictions, and $1.2 billion represents the City's net investment in capital assets, less any related outstanding debt used to acquire those assets.
 Governmental revenues and transfers total $510.1 m illion and include program revenues of $220.7 million and general revenues of $289.0 million. Governmental expenses were $321.6 million. • Business-type program revenues, and investment earnings were $164.5 million, while business-type expenses were $135.9 million.

Fund Level:
 The City’s Governmental Funds reported a combined ending fund balance of $607.1 million at the close of June 30, 2022, an increase of $101.4 million compared with the prior fiscal year. The General Fund balance in this report, as of June 30, 2022, was $178.6 million without encumbrances. Included in this fund balance and under the guidance of the Reserve and Fund Balance Policy – Genera l Fund (excluding related funds), Council took action to fund the priority one workin g capital reserve at $47.2 million, fully fund known contingency reserves at $55.3 million, and increased the risk-based reserves to $10.8 million.  The total Governmental Fund revenues increased from the prior fiscal year by 15.5 percent. A large portion of this increase is attributable to special federa l grants and subsidies for fiscal year 2021-22 with approximately $75.5 million related to COVID-19 pandemic recovery efforts. Other large increases were due to sales tax revenues, franchise fees, charges for services; however, the city saw a loss in investment earnings due to the fair market value adjustment.

The total Governmental Fund expenditures increased by 9.4 percent compared to the prior fiscal year primarily due to a $26.9 million increase in capital outlay expenditures. General government and parks and recreation expenditures also experienced post pandemic growth. The increases in all three of these categories reflect expenditure of federal grants and subsidies.

OVERVIEW OF THE FINANCIAL STATEMENTS

The City’s Annual Comprehensive Financial Report consists of four main components: 1) management’s discussion and analysis, 2) the basic financial statements, 3) requ ired supplemental information, and 4) combining non-major fund financial statements. The basic financial statements include two kinds of statements that present different views of the City, the government-wide, and the fund financial statements:
 The government-wide financial statements provide both long-term and short-term information about the City’s overall financial status.
 The fund financial statements focus on the City government's individual parts, reporting the City’s operations in more detail than the government-wide statements.

ATTACHMENT A

6 OVERVIEW OF THE FINANCIAL STATEMENTS, CONTINUED

The basic financial statements also include notes that provide additional information essential to understanding the data contained in the government-wide and fund financial statements. The statements and notes are followed by the Schedule of Changes in Net Pension Liability and Relations Ratios and Schedule of Changes in Contributions for the City’s pension plans which are required supplemental inform ation. In addition to these required elements, we have included combining statements and schedules that provide details about the City’s other Governmental Funds, other Enterprise Funds, the Water Enterprise F und, the Wastewater Enterprise Fund, Internal Service Funds, Investment Trust Funds, and Agency Funds, each of which is presented in a column in the basic financial statements.

Government-Wide Financial Statements:

The government-wide financial statements report information about the City using accounting methods like those used by private-sector companies. The statement of net position includes all the City’s assets and liabilities and any deferred outflows and inflows of resources. The statement of activities includes all current year revenues and expenses regardless of when cash is received or paid. These government-wide statements report the City’s net position and how the City’s net position has changed during the fiscal year. Over time, increases or decreases in position may serve as a useful indicator of whether the financial health of the City is improving or deteriorating.

The government-wide financial statements of the City are divided as follows:
 Governmental activities – Most of the City’s basic se rvices are included here, such as police, fire, public works, community development, parks and recreation, and general government. Taxes and state and federal grants finance most of these activities.
 Business type activities – Certain services provided by the City are funded by customer fees. Among these are the City’s utility services, parking authority, and other non-major enterprise funds.

This Annual Comprehensive Financial Re port (“ACFR”) includes the financial activity of the separate legal entity controlled by the City, the Stockton Public Financing Authority.

The Successor Agency’s activities are reported as a Private-Purpose Trust Fund in the ACFR. The City Council sits as the Successor Agency to the Stockton Redevelopment Agency’s Board. All actions about the Successor Agency’s obligations are made by the Successor Agency Countywide Oversight Board, which is comprised of members representing the interests of local jurisdictions affected by redevelopment activities and revenue claims.

The government-wide financial statements can be found on pages 17-19 of this report.

Fund Financial Statements:

A fund is a group of related accounts used to maintain cont rol over resources that have been segregated for specific activities or objectives. The City uses fund accounting to en sure and demonstrate finance-related legal compliance.

Fund financial statements provide more detailed information about the City’s largest funds, not the City as a whole.

The City has three types of fund financial statements: Governmental Funds, Proprietary Funds, and Fiduciary Funds.

Governmental Funds – Governmental Fund statements tell how general government services such as police, fire, and public works, among others, were finances in the short term as well as what remains for future spending. Most of the City’s basic services are included in Governmental Funds, focusing on (1) short-term inflows and outflows of spendable resources and (2) the remaining year-end balances available for spending. Because this information does not encompass the additional long-term focus of the govern ment-wide statements, reconciliations that explain the relationship (or differences) between Governmental Funds and Governmental Activities follow the Governmental Fund Statements.

The basic Governmental Fund Financial Statements can be found on pages 22-25 of this report.

ATTACHMENT A

7 OVERVIEW OF THE FINANCIAL STATEMENTS, CONTINUED

Fund Financial Statements, Continued:

Proprietary Funds - Services for which customer fees are intended to finance the costs of operations are generally reported in Proprietary Funds. Proprietary Fund statements, like the government-wide statements, provide short-term and long-term financial information about the activities the City operates like businesses, such as utility services, parking facilities, and marina operations.

The basic Proprietary Fund financial statements can be found on pages 28-37 of this report.

Fiduciary Funds - Fiduciary Fund statements provide information about the financial relationships in which the City acts solely as a trustee or agent for the benefit of others, to whom the resources belong. The City is the trustee, or fiduciary, for a closed pension plan. It is also responsible for other assets reported in an investment trust fund, which, because of trust agreements, can be used only for the trus t beneficiaries. The City elected to serve as the Successor Agency for its former Redevelopment Agency, which was dissolved by state la w. The Successor Agency activity is accounted for in a Private Purpose Trust Fund. The City is responsible for ensuring that assets reported in these funds are used for their intended purposes. All the City’s fiduciary activities are reported in a separate statement of fiduciary net position and a statement of changes in fiduciary net position. We exclude these activities from the City’s government-wide financial statements because the City cannot use these resources to finance its operations.

The basic Fiduciary Fund's financial statement can be found on pages 40-41 of this report.

Notes to the Basic Financial Statements
The notes to the financial statements provide additional information that is essential to a full understanding of the financial information provided in the government-wide and fund financial statements.

The notes to the financial statements can be found on pages 45-107 of this report.

Other information
In addition to the basic financial statements, this report presents certain re quired supplementary information. This information provides a budgetary comparison schedule fo r the General Fund, Federal Housing Grants Special Revenue Fund, and the Special Grants Fund, as well as information about the City's participation in the PERS and PARS defined benefit pension plans.

Required supplementary information can be found on pages 109-127 of this report.

GOVERNMENT-WIDE FINANCIAL ANALYSIS
Analysis of Net Position
The City’s net position may serve over time as a useful indicat or of a government’s fina ncial health or financial position. As of June 30, 2022, the City’s total assets and deferred outflows of resources exceeded its liabilities and deferred inflows of resources by $1.8 billion, which is an increase of $216.7 million or 13.8 percent compared to the prior fiscal year.

ATTACHMENT A
8 GOVERNMENT-WIDE FINANCIAL

ANALYSIS, CONTINUED
Analysis of Net Position, Continued:

The following is the condensed statement of net position for the fiscal years ended June 30, 2022, and 2021 (amounts in thousands):

The primary components of the City’s net position consist of the following elements:
• The investment in capital assets (e.g., infrastructure, land, buildings, improvement s other than buildings, construction in progress, and equipment), less any rela ted debt used to acquire assets still outstanding, represents the largest portion of the City’s net position at $1.2 billion or 67.5 percent. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending.

Although the City reports its investment in its capital assets net of related debt, the resources needed to repay this debt must be provided from other sources because proceeds from the sale of capital assets are not used to liquidate these liabilities.
• External restrictions represent $549.8 million or 30. 9 percent of net position and are subject to various external restrictions on how they may be used. Creditor s, grantors, contributions, or laws and regulations of other governments have imposed this component of the net position; or it has been imposed by law through enabling legislation or constitutional provisions.
• The unrestricted net position is $29.3 million or 1.6 pe rcent of the total net position. Information about changes in net position for FY 2021- 22 and FY 2020-21 is summarized on the following page. The ACFR discusses the reasons for the changes in the sections for governmental activities and business-type activities. 2022 2021 2022 2021 2022 2021
Assets:

Current and other assets 936,598$ 840,374$ 269,527$ 314,829$ 1,206,125$ 1,155,203$ Capital assets 822,615 794,633 819,159 769,890 1,641,774 1,564,523 Total assets 1,759,213 1,635,007 1,088,686 1,084,719 2,847,899 2,719,726 Deferred Outflow of Resources:

Unam ortized loss on refunding of debt - - 13,645 14,555 13,645 14,555 Pension-related deferred outflows of resources 59,815 76,508 2,989 2,528 62,804 79,036 Total Deferrals-Outflows 59,815 76,508 16,635 17,083 76,450 93,591 - - Lia
b ilities:

Current and other liabilities 110,864 118,953 40,483 40,847 151,347 159,800 Long-term obligations 113,328 116,888 385,126 406,979 498,454 523,867 Net Pension liability 313,515 533,858 8,391 15,774 321,906 549,632 Total liabilities 537,707 769,699 434,001 463,600 971,708 1,233,299 - - Deferred
Inflow of Resources:

Pension-related deferred inflows of resources 162,705 11,688 6,373 1,405 169,078 13,093 Leases 1,449 1,520 59 86 1,508 1,606
Total Deferrals Inflows 164,154 13,208 6,432 1,491 170,586 14,699 - - Net p
osition:

Net investment in capital assets 764,271 733,822 438,675 365,919 1,202,946 1,099,741 Restricted 524,406 458,650 25,394 46,241 549,800 504,891 Unrestricted (deficit) (171,510) (263,864) 200,819 224,551 29,309 (39,313) Total net position 1,117,167$ 928,608$ 664,888$ 636,711$ 1,782,055$ 1,565,319$ Governmental
Activities
Business-T yp e
Activities Total

ATTACHMENT A
9 GOVERNMENT-WIDE FINANCIAL

ANALYSIS, CONTINUED
Analysis of Net Position, Continued:

The following table indicates the change in net position for Governmental a nd Business-type activities (amounts in thousands):
2022 2021 2022 2021 2022 2021
Revenues
Program revenues:

Charges for services 72,491 $ 65,693 $ 156,777 $ 148,966 $ 229,268 $ 214,659$ Operating grants and contributions 100,879 51,328 2,500 - 103,379 51,328 Capital grants and contributions 47,352 39,065 12,232 13,263 59,583 52,328 G eneral revenues:

Property tax es 41,066 38,523 - - 41,066 38,523 Utility us er taxes 38,328 36,414 - - 38,328 36,414 Sales and use tax es (City levied) 75,037 68,639 - - 75,037 68,639 Franchise tax es 21,186 16,901 - - 21,186 16,901 B usi ness li censes 15,905 15,695 - - 15,905 15,695 Hotel/motel room tax es 3,620 2,860 - - 3,620 2,860 Document transfer tax es 1,626 1,222 - - 1,626 1,222 Other taxes 4,016 2,874 - - 4,016 2,874
Motor vehicle fees in lieu 27,310 27,757 - - 27,310 27,757 Sales and use tax es (State levied) 76,239 65,201 - - 76,239 65,201 Investm ent earnings (25,552) 14,086 (7,018) 57 (32,570) 14,143 Miscellaneous 10,369 11, 105 - - 10,369 11,105 G ain (loss) on disposal of capital assets (132) 147 - - (132) 147 Total revenues 509,740 457,510 164,489 162,286 674,229 619,796 Expe ns e s - - -
G eneral governm ent 72,154 74,313 - - 72,154 74,313 Public safety 170,563 217,954 - - 170,563 217,954 Public works 43,601 55,086 - - 43,601 55,086
Library 13,107 12,792 - - 13,107 12,792
Parks and recreation 14,300 11,526 - - 14,300 11,526 Interest and fiscal charges 7,894 4,373 - - 7,894 4,373 Water utility - - 54,532 54,266 54,532 54,266 Wastewater utility - - 66,991 61,124 66,991 61,124 Stormwater utility - - 7,288 6,759 7,288 6,759 Central parking district - - 5,687 4,995 5,687 4,995 Other - - 1,376 1,667 1,376 1,667
T
otal ex penses 321,619 376,044 135,873 128,811 457,493 504,855 Increase/(decrease) in net - - -
position before transfers 188,121 81,466 28,616 33,475 216,737 114,941 Transfers 438 1,751 (438) (1,751) - -
Change in net position 188,559 83,217 28,178 31,724 216,737 114,941 Net position, beginning - 843,788 - 604,942 - 1,448,730 Prior period adjustm ent - 1,603 - 45 - 1,648
Net position, beginning, as restated 928,608 845,391 636,710 604,987 1,565,318 1,450,378 Net position, end of year 1,117,167$ 928,608 $ 664,888 $ 636,711 $ 1,782,055 $ 1,565,319 $ Business-Typ eGovernmental
TotalActivities Activities

ATTACHMENT A

10 GOVERNMENT-WIDE FINANCIAL ANALYSIS, CONTINUED

Analysis of Net Position, Continued:

Governmental activities: The change in net position increased by $188. 6 million compared to the prior fiscal year due to these following variances:

• Total governmental activities revenues increased by $52.2 million or 11.4 percent compared to the prior fiscal year. The increase were mostly attributable to additional operating and capital grants and state & city levied sales and use taxes. However, due to the low inter est rate environment, there was $39.6 million revenue decrease in investment income due to a fair market value adjustment. • Total governmental activities expenses show a decrease of $54.4 million. A large part of this decrease is attributed to the pension credit recorded due to the PERS actual investment earnings higher than the expected rate of return. .

Business-type activities: The change in net position increased by $28.2 million compared to the prior fiscal year primarily due wastewater rate increases to cover operating costs and capital commitments.

FINANCIAL ANALYSIS OF THE CITY’S FUNDS

The City uses fund accounting to ensure and demonstrate co mpliance with finance-related legal requirements. This analysis should be read in conjunction with fund financial statements beginning on page 22.

Governmental Funds
As of June 30, 2022, the City’s Governmental Funds reported a combined ending balance of $607.1 million, an increase of $101.4 million compared to the prior fiscal year. The total fund balance of the Governmental Funds consists of the following:

 The non-spendable fund balance of $2.2 million were amounts that inherently cannot be spent, such as inventories and prepaid items. Also, long-term loans and notes receivable, and property held for resale would be reported here unless the proceeds are restricted, committed, or assigned.  Restricted fund balance of $433.6 million that is based on restrictions imposed by external parties or enabling legislation.
 Committed fund balance of $123.8 million was constrained for a specific purpose by the City Council through resolution. It would require action by the same group to remove or change the constraints placed on the resources.
 Assigned fund balance of $4.3 million w as constrained for the intent to be used for a specific purpose by a governing board or a body or official that has b een delegated authority to assign amounts. The amount reported as assigned should not result in a deficit in the unassigned fund balance.  The unassigned fund balance of $43.2 million includes the working capital reserve established in the Reserve and Fund Balance Policy-General Fund to accommodate nor mal fluctuations in the timing of revenues and unforeseen operational costs.

ATTACHMENT A

11 FINANCIAL ANALYSIS OF THE CITY’S FUNDS, CONTINUED

Governmental Funds, Continued:

Revenues – The following table presents revenues (amounts in thousands) classified by source with a comparison to the prior fiscal year:

The graph below shows 2022 revenue categories as a percent of the total.

Revenue by Source Am ount
Percent of
Total Am ount
Percent of
Total Amount
Percent of
Change
Property taxes 41,066 $ 8.1% 38,523 $ 8.7% 2,543$ 6.6% Utility user 38,328 7.5% 36,414 8.2% 1,914 5.3% Sales tax - levied by City 82,951 16.3% 68,639 15.5% 14,312 20.9% Franchise fees 19,932 3.9% 16,901 3.8% 3,031 17.9% Business license 15,905 3.1% 15,695 3.6% 210 1.3% Transient occupancy tax 3,620 0.7% 2,860 0.6% 760 26.6% Document Transfer/other 5,641 1.1% 4,095 0.9% 1,546 37.8% License and perm its 9,129 1.8% 7,670 1.7% 1,459 19.0% Intergovernmental 246,713 48.4% 194,701 44.1% 52,012 26.7% Charges for services 39,532 7.8% 31,330 7.1% 8,202 26.2% Fines and forfeitures 2,001 0.4% 379 0.1% 1,622 428.1% Use of m oney and property 9,955 2.0% 5,731 1.3% 4,224 73.7% Interest income (13,673) -2.7% 7,785 1.8% (21,458) -275.6% Refunds and reim bursem ents 550 0.1% 602 0.1% (52) -8.6% Miscellaneous 8,258 1.6% 10,189 2.3% (1,931) -18.9% Total 509,910$ 100.0% 441,514 $ 100.0% 68,396$ 15.5% 2021 Increase/(Decrease)2022

ATTACHMENT A
12 FINANCIAL ANALYSIS OF THE CITY’S FUNDS, CONTINUED
Governmental Funds, Continued:

The following bullets provide an explanation of significant changes in revenues compared with the prior fiscal year:
• Sales tax revenues, reported under both Sales taxes and intergovernmental revenues, increased $25.3 million or 19 percent over the prior year as consumer spen ding habits shifted during the pandemic and federal stimulus dollars added to household disposable income. A change in re porting by a taxpayer in the prior fiscal year continued to result in additional tax revenues being allocated directly to the City rather than shared through a pool.
• Federal grants and other intergovernmental revenues were approximately $41.0 million greater than the prior year primarily due to additional COVID relief funds.
• Property tax revenues saw an increase due to a strong real estate market and industrial development. • Due to the historic low interest rate environment, inter est income resulted in a deficit due to the fair market value adjustment.
• Charges for services increased by $8.2 million or 26 percent over the prior year primarily due to more Public Facility Fee and Development Services fees generated from the issuance of more commercial and industrial building permits in FY 2022.

Expenditures - The following table presents expenditures (amounts in thousands) by function compared with the prior fiscal year:

The following bullets explain the expenditures that changed significantly compared with the prior fiscal year. • General government expenditure increased by $4.6 million and a large portion of this is attributed to the special grants.
• Capital outlay expenses increased with a corresponding decrease in Public Works. A change in reporting moved Capital Outlay expenses out of the Public works function. The significant Capital outlay changes over prior year is attributable to major projects such as construction of the Northeast Library and Recreation center, Bicycle and Pedestrian Path development, and Federal-Aid Urban (FAU) street resurfacing activities. • Library and Recreation expenditures increased over prior year with the restoration of programing that was suspended at library and recreation facilities during FY 2021 due to COVID restrictions.

Percent of Percent of Percent of
Ex penditures by Function Am ount Total Am ount Total Am ount Change Current:

G eneral governm ent 76,830$ 18.8% 72,185$ 19.3% 4,645$ 6.4% Public safety 206,107 50.4% 205,923 55.1% 184 0.1% Public works 34,263 8.4% 41,960 11.2% (7,697) -18.3% Library 14,658 3.6% 12,762 3.4% 1,896 14.9%
Parks and recreation 14,552 3.6% 8,207 2.2% 6,345 77.3% Capital outlay 53,033 13.0% 26,127 7.0% 26,906 103.0% Debt service 9,340 2.3% 6,422 1.7% 2,918 45.4%
Total 408,783$ 100.0% 373,586$ 100.0% 35,197$ 9.4% 2022 2021 Increase/(Decrease)

ATTACHMENT A

13 General Fund

Below is a graph that depicts the change in Genera l Fund balances between FY 2021- 22 and FY 2020-21. The committed and unassigned balances have increased from the prior fiscal year.

Fund Balance
(in millions)

NOTE: Does not include PARS 115 Trust

The City’s General Fund provides police, fire, development, public works, and administrative services to the City’s residents, other funds, businesses, and visitors. The General Fund is distinct from the City’s other funds because it is the only source of unrestricted funds that the City Council can allocate at its discretion for any municipal purpose.

General Fund revenues were $304.0 million at the close of J une 30, 2022, an increase of $17.6 million (6.1 percent) compared to the prior fiscal year. Significant changes in General Fund revenu es compared with the previous fiscal year include:

 Sales tax levied by the City and the State was up significantly this year ($15.6 million) compared to the prior fiscal year from a combination of pandemic driven sh ifts in consumer spending habits, federal stimulus dollars, price inflation, and a shift in reporting of a major taxpayer.  Property tax revenues increased by $2.5 million due to a steady increase in property values and increased new non-residential construction.
 Use of money and property revenue increased $3.7 million over prior year primarily due to higher revenues generated at entertainment venues as a result of the entertainment industry experiencing a recovery from the impacts of the COVID pandemic.
 Due to the low interest rate environment, interest income from the City’s short- and long-term investment portfolios resulted in a deficit when compared to the prior fiscal year due to the fair market value adjustment.

General Fund expenditures were $244.2 million, an increase of $6.0 million or 2.5 percent compared to the prior fiscal year. General government expenses decreased by $6.2 million compared to the last fiscal year. Public safety expense growth of $3.6 million was primarily the result of health benefits, insurance premiums, and overtime expenses. Parks and recreation expenses increased $6.4 milli on over prior year primarily due to the reopening of entertainment venues from the impacts of the COVID pandemic.

ATTACHMENT A
14 Proprietary Funds
The City’s Proprietary Fund Financial S
tatements provide the same type of information found in the Government- Wide Financial Statements but in more detail. At the end of June 30, 2022, business-type activities' net position was $664.9 million, an increase of $28.2 million or 4.4 percent compared to the prior fiscal year.

The assets and deferred outflows of resources increased by a combined total of $3.5 millio n. Of this amount, the current cash and investments and other existing assets decreased by $45.3 millio n, and non-current assets, including capital assets and
deferred outflows, increased by $48.8 million.

The liabilities and deferred inflows of resources decreased by $21.8 million due primarily to the principal payments made on debt and pension-
related adjustments.

GENERAL FUND BUD

GETARY HIGHLIGHTS
The City’s FY 2021-22 General Fund Adopted Budget funde d t h e City’s most pressing needs in support of the Council’s strategic priorities. However, it continued to be constrained by the City’s long-term financial outlook especially in consideration of future pension and labor costs. The FY 2021-22 budget was developed as the City continued to
respond to a once-in-a-century pandemic crisis with a focus on moving forward through the crisis and into recovery. With an unprecedented amount of state and federal dollars coming in to provide relief and recovery
to Stockton citizens, capacity to deliver new operating budget pro grams was limited. The budget included some incremental service
enhancements and high-priority one- time appropriations. This an alysis should be read in conjunction with the General Fund Budgetary Information beginning on page 109.

The General
Fund’s original budgeted revenues totaled $267.5 million and was decreased to $267.0 million during the fiscal
year. The General Fund ended the fiscal year with total revenues of $304.0 million, reflecting a $37.0 million, or 13.9 percent, increase over the final budget. The most significant revenue variance was sales tax revenues at $26.9 million more than the budget. The revenue categories hardest hit by the COVID pandemic, Hotel Motel Taxes
and the Document transfer taxes, recovered to pre-pandemic levels in FY 2021-22.

Collection of
Business license taxes improved during the pandemic as businesses had to show proof of a license for federal assistan
ce. This trend continued into FY 2021-22 with revenues slightly lower than the prior year still exceeding the budget by $4.3 million. The next largest budget variances were in Property taxes and Utility user taxes categories which benefited from new residential and industrial constru ction.

The General
Fund’s original expenditure budget of $265.5 million was adjusted by encumbrances and commitments carried forward
from the prior year for a total final budget of $276.0 million. All General Fund departmental activities ended the fiscal year below budget. The debt service category shows an overage due to the booking of lease related entries for GASB 87 implementation and interest expense on a loan to the Emergency Communications subfund anticipated to be repaid in FY 2022-23. Actual expenditures and transfers-out were lower than
the final approved budget appropriations by $102.8 million, or 31.9 percent. Of this variance, $48.2 million in appropriations rolled into FY 2022-23 for encumbrances, capital projects, and specific City Council authorized activities. General Government departments achieved a savings of $6.3 million, Public Works activities we
re under budget by $1.6 million, Parks and recreation activities were under budget by $3.0 million, Library expenses were $2.2 million below budget, and $18.1 million was saved in Public Safety. A significant contributing factor
to the savings was staff vacancies. Approximately $1 6.7 million of the savings was the result of higher-than-anticipated vacancies across all General Fund departmen ts. Many local governments are experienci
ng difficulties filling full-time positions in a very tight labor market. The number of full-time employees in FY 2021-22 was lower than the last five fiscal years and authorized positions have increased during this period.

ATTACHMENT A
15 The City’s General Fund balance at June 30, 2022, was $171.3 million on a budgetary basis, which is an increase of $40.4 million from the
prior year. The City Council authorized $29.6 million of this increase to be added to General Fund reserves for a total funded reserve of $113.3 million. The ACFR reporting of General Fund balance at $171. 3 million includes general services to the public such as public safety and streets, libraries, recreation centers, and emergency dispatch, whereas the quarterly budget status reports released through the City Council break down the general operations ($132 million) separate from ancillary services of libraries, recreation, etc.

CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets
The City’s investment in capital assets for its governmental and business-type activities as of June 30, 2022, amounted
to $1.6 billion (net of accumulated depreciation). Net i nvestment in capital assets includes infrastructure, land, buildings, and improvements other than buildings, intangible assets, equipment, construction in progress, and leases.

The total change in the City’s net investment in capital assets for the current fiscal year was an increase of 4.9 percent.

The City’s capital assets, net of accumulated depreciati on, for the governmental and business-type activities are presented below to illustrate changes from the prior year (amounts in thousands):

Additional information on the City’s capital assets can be found in Note 7 - Capital Assets of this report.

Bond Indebtedness
At the end of the fiscal year, the City’s total outstandi ng net bonded debt, including bankruptcy settlements, was $453.5 million. Of this amount, $57.8 million is related to governmental activities, and $395.7 million are debt obligations of business-type activities.

Governmental activities bonded indebtedness decreased by $2.1 million because of the scheduled principal payments. 2022 2021 2022 2021 2022 2021
Land 38,197 38,197$ 15,127 15,127$ 53,324 53,324$ Intangible Assets 4,355 4,355 - - 4,355 4,355 Building and
Improvements 180,483 171,459 603,076 623,065 783,558 794,524 Machinery and
Equipment 28,780 28,124 4,866 5,574 33,645 33,698 Infrastructure 377,710 388,419 - - 377,710 388,419 Construction
in Progress 192,072 162,225 193,438 123,266 385,510 285,491 Lease Assets 1,020 1,855 2,651 2,858 3,671 4,713 Total 822,615$ 794,634$ 819,159$ 769,890 $ 1,641,774$ 1,564,524$ Business-T yp e
Activities
Gov ernmental
Activities Total

ATTACHMENT A
16 Business-type activities bonded indebtedness also decreased by $22.6 million due to the scheduled debt service
payments for the enterprise debt and refund the 2019 Bond anticipation note.

Governmental outstanding net bonded debt of $57.8 million includes $53.1 million in settlement liability to the bond insurer (Assured Guaranty) for 2007 bonds adjusted in bankruptcy.

Business-type activities outstanding net bonded debt obligations of $395.8 million includes $196.0 million of revenue bonds of the Water Utility, $157.0 milli on in revenue bonds and EPA WIFIA loan for the Wastewater Utility, and $29.3 million in revenue bonds for the Parking Authority. Marina operations have a loan obligation of $10.9 million through the State Department of Parks and Recreation. This obligation no longer accrues interest due to the bankruptcy settlement. The General Fund annually subsidizes the Marina’s operations, a nd payments on this loan will not commence until subsidization is no longer needed.

Successor Agency bonded debt of $91.3 million is reported separately in a Private Purpose Trust Fund. The balance outstanding at June 30, 2022, includes $80.2 million of tax- exempt tax allocation bonds issued to refinance revenue bonds for various former redevelopment projects and $11.1 million of taxable tax allocation bonds issued to refinance revenue bonds for various housing projects.

Additional information on the City’s long-term debt can be found in Note 8 - Long-Term Liabilities of this report.

Requests for Information
This financial report is designed to prov ide citizens, taxpayers, customers, gran tors, investors, and creditors with a general overview of the City’s finances and to demonstrate the City’s accountability for the money it receives. If you have any questions about this report or need additional financial information, contact the Administrative Services Department of the City of Stockton at City Hall, 425 North El Dorado Street, Stockton, CA 95202.

Financial reports are available on the City’s website at:
http://www.stocktongov.com/government/departments/adminservices/finrep.html

ATTACHMENT A

BASIC FINANCIAL STATEMENTS

ATTACHMENT A

ATTACHMENT A

GOVERNMENT-WIDE FINANCIAL STATEMENTS

ATTACHMENT A

ATTACHMENT A
Governmental Business-Type
Activities Activities Totals
Cash and investments 628,464,543 $ 239,215,234 $ 867,679,777 $ Restricted cash and investments 71,545,010 6,465,449 78,010,459 Interest receivable 1,770,123 575,710 2,345,833 Accounts receivable, net 19,755,699 25,684,153 45,439,852 Due from other governments, net 48,196,724 569,530 48,766,254 Internal balances 7,011,332 (7,011,332) - Inventory of supplies 701,029 2,046,281 2,747,310 Prepaid items 4,813,959 1,643,286 6,457,245 Lease receivable 1,473,569 59,411 1,532,980 Advance deposits 2,323,748 89,521 2,413,269 Loans to Successor Agency, net 1,106,580 - 1,106,580 Loans to property owners, net 149,435,642 190,000 149,625,642 Capital assets:

Nondepreciable and nonamortizable 234,623,105 208,565,593 443,188,698 Depreciable and amortizable, net 587,991,781 610,593,074 1,198,584,855 Total assets 1,759,212,844 1,088,685,910 2,847,898,754 Unamortized loss on refunding of debt - 13,645,282 13,645,282 Pension-related deferred outflows of resources 59,814,713 2,989,264 62,803,977 Total deferred outflows of resources 59,814,713 16,634,546 76,449,259 Accounts payable and accrued expenses 28,986,863 19,232,407 48,219,270 Accrued payroll and benefits 3,067,329 1,319,814 4,387,143 Due to other governments/agencies 5,211,729 95,237 5,306,966 Accrued interest 1,666,148 3,670,399 5,336,547 Deposits and other liabilities 3,048,328 3,248,678 6,297,006 Retention payable 761,398 851,201 1,612,599 Unearned revenue 46,309,567 -
46,309,567
Long-term liabilities:

Due within one year:

Compensated absences 6,724,018 917,209 7,641,227 Claims payable 12,978,791 - 12,978,791 Long-term debt 2,109,339 11,148,434 13,257,773 Due in more than one year:

Compensated absences 5,231,183 522,697 5,753,880 Claims payable 52,421,442 - 52,421,442 Long-term debt 55,674,921 384,603,178 440,278,099 Aggregate net pension liability 313,515,372 8,391,374 321,906,746 Total liabilities 537,706,428 434,000,628 971,707,056 162,705,190 6,372,566 169,077,756
1,449,407 59,083 1,508,490
Total deferred inflows of resources 164,154,597 6,431,649 170,586,246 Net investment in capital assets 764,271,388 438,675,449 1,202,946,837 Restricted 524,405,555 25,394,011 549,799,566 Unrestricted (deficit) (171,510,411) 200,818,719 29,308,308 Total net position 1,117,166,532$ 664,888,179 $ 1,782,054,711 $ City of Stockton
Statement of Net Position
June 30, 2022

NET POSITION

DEFERRED INFLOWS OF RESOURCES

LIABILITIES

DEFERRED OUTFLOWS OF RESOURCES
ASSETS
Pension-related deferred inflows of resources
Leases
See accompanying Notes to the Basic Financial Statements. 17 ATTACHMENT A
Operating Capital
Charges for Grants and Grants and
Functions/Programs Expenses Services Contributions Contributions PRIMARY GOVERNMENT:

Governmental activities:

General government 72,154,112 $ 31,122,550 $ 91,367,121 $ 75,179 $ Public safety 170,563,405 18,688,078 9,101,014 - Public works 43,601,040 14,290,951 296,366 47,276,467 Library 13,106,761 7,537,371 59,292 - Parks and recreation 14,300,010 852,433 55,410 - Interest and fiscal charges 7,894,016 - - - Total governmental activities 321,619,344 72,491,383 100,879,203 47,351,646 Business-type activities:

Water utility 54,531,692 66,012,825 47,298 7,693,391 Wastewater utility 66,990,653 78,508,927 2,253,527 4,155,076 Stormwater utility 7,288,385 6,136,802 - 383,023 Parking Authority 5,687,097 5,690,268 198,735 - Downtown Marina 1,105,483 395,336 - - Golf Courses 270,007 32,394 - - Total business-type activities 135,873,317 156,776,552 2,499,560 12,231,490 Total 457,492,661$ 229,267,935 $ 103,378,763 $ 59,583,136 $

Program Revenues
City of Stockton
Statement of Activities
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 18 ATTACHMENT A
Governmental Business-Type
Functions/Programs Activities Activities Totals
PRIMARY GOVERNMENT:

Governmental activities:

General government 50,410,738 $ - $ 50,410,738$ Public safety (142,774,313) - (142,774,313) Public works 18,262,744 - 18,262,744 Library (5,510,098) - (5,510,098) Parks and recreation (13,392,167) - (13,392,167) Interest and fiscal charges (7,894,016) - (7,894,016) Total governmental activities (100,897,112) - (100,897,112) Business-type activities:

Water utility - 19,221,822 19,221,822 Wastewater utility - 17,926,877 17,926,877 Stormwater utility - (768,560) (768,560) Parking Authority - 201,906 201,906 Downtown Marina - (710,147) (710,147) Golf Courses - (237,613) (237,613) Total business-type activities - 35,634,285 35,634,285 Total net (expense) revenue (100,897,112) 35,634,285 (65,262,827) General revenues and transfers:

General revenues:

Taxes:

Property 41,066,425 - 41,066,425 Utility user 38,328,240 - 38,328,240 Sales - levied by City 75,036,888 - 75,036,888 Franchise fees 21,185,769 - 21,185,769 Business license 15,905,391 - 15,905,391 Transient occupancy tax 3,619,973 - 3,619,973 Document transfer 1,625,553 - 1,625,553 Other 4,015,502 - 4,015,502 Shared revenue:

Vehicle license fees 27,310,329 - 27,310,329 Sales and use tax levied by state 76,238,894 - 76,238,894 Investment earnings (loss) (25,551,559) (7,018,187) (32,569,746) Miscellaneous 10,368,627 - 10,368,627 Gain (loss) on disposal of capital assets (132,415) - (132,415) Transfers 438,091 (438,091) -
Total general revenues and transfers 289,455,708 (7,456,278) 281,999,430 Changes in net position 188,558,596 28,178,007 216,736,603 Net position:

Beginning of year, as restated (Note 19) 928,607,936 636,710,172 1,565,318,108 End of year 1,117,166,532$ 664,888,179 $ 1,782,054,711 $ Change in Net Position
Net (Expense) Revenue and
City of Stockton
Statement of Activities (Continued)
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 19 ATTACHMENT A
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20 ATTACHMENT A

FUND FINANCIAL STATEMENTS

ATTACHMENT A

ATTACHMENT A
Governmental Fund Types
The City's major governmental funds include:

General Fund
Federal Housing Grants Special Revenue Fund
Special Grants Special Revenue Fund
Capital Improvement Capital Projects Fund
Individual non-major funds are presented in the Supplementary Information section.

To account for the acquisition, construction and improvement of capital facilities as required by City Council action or state law in which the projects are financed by grants, lease proceeds and transfers from other City governmental funds.

GOVERNMENT FUND FINANCIAL STATEMENTS
Special revenue and capital projects funds are used to account for the financial resources that are restricted, committed, or assigned to expenditures for special purposes or capital outlays, including the acquisition and development of capital facilities and other capital assets.

To account for resources not accounted for in another fund. The General Fund is the City's main operating fund reflecting transactions related to municipal governmental services supported by taxes, intergovernmental revenues, charges for services and other
governmental type revenues.

To account for one-time resources received through the federal CARES and American Rescue Plan Act and in addition to some comparatively smaller grants from federal and state governments to support public safety and other community programs which are not otherwise accounted in other special revenue funds.

Governmental funds consist of the general fund, special revenue, debt service, capital projects, and permanent funds.

To account for federal grant programs and other resources that provide for development of a viable urban community by providing a suitable living environment, loans to non-profit housing developers to acquire and rehabilitate abandoned and foreclose homes, and provides down payment assistance to qualified low- and moderate-income households. This fund includes the City’s annual federal funding from the Community Development Block Grant, Community Rehabilitation Loan program, federal revolving loan program, revitalization activities in the designated Urban Development Action Grant area, Housing and Urban Development (HUD) Section 108, (Home) Housing grants and loans, and Neighborhood Stabilization Loan Program (NSP Funds).
21 ATTACHMENT A
Capital Projects
Federal Other Total
General Housing Special Capital Governmental Governmental Fund Grants Grants Improvement Funds Funds
ASSETS
Cash and investments 160,301,427 $ 5,337,114 $ 81,110,893 $ 26,033,164 $ 213,972,050 $ 486,754,648 $ Cash and investments with fiscal agents - 1,576,679 - - - 1,576,679 Receivables, net:

Interest 678,558 1,634 - 3,493 526,021 1,209,706 Accounts and other receivables 16,574,676 20,722 125,435 - 2,694,406 19,415,239 Lease 1,459,590 13,979 1,473,569
Due from other governments, net 24,230,421 - 1,333,882 14,160,616 8,471,805 48,196,724 Inventory of supplies 521,303 - - - - 521,303 Prepaid items 24,042 - 1,832,820 - 25,315 1,882,177 Advance deposits 1,532,011 - 108,354 - 125,387 1,765,752 Loans to Successor Agency, net - - - - 1,106,580 1,106,580 Loans to property owners, net - 80,384,153 - - 69,051,489 149,435,642 Total assets 205,322,028$ 87,320,302 $ 84,511,384 $ 40,197,273 $ 295,987,032 $ 713,338,019 $

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES AND FUND BALANCES
Liabilities:

Accounts payable 9,908,303 903,090 3,173,202 6,868,148 4,918,878 $ 25,771,621 $ Accrued payroll and benefits 1,022,674 30,397 108,291 117,050 1,299,813 2,578,225 Due to other funds 495,600 -
- - - 495,600 Due to other governments 3,281,041 5,957 - - 1,924,731 5,211,729 Deposits and other liabilities 1,983,942 - - - 1,015,282 2,999,224 Retention payable - - - 761,398 - 761,398 Unearned revenue 1,882,498 - 44,427,069 - - 46,309,567 Total liabilities 18,574,058 939,444 47,708,562 7,746,596 9,158,704 84,127,364 Deferred inflows of resources:

Unavailable revenue - other 6,699,134 - - 12,856,485 1,136,761 20,692,380 Lease 1,435,443 13,964 1,449,407
Total deferred inflows of resources 8,134,577 - - 12,856,485 1,150,725 22,141,787 Fund Balances:

Nonspendable 2,077,356 - - - 150,702 2,228,058 Restricted 5,289,369 86,380,858 36,802,822 19,594,192 285,526,901 433,594,142 Committed 123,753,548 - - - - 123,753,548 Assigned 4,284,719 - - - - 4,284,719 Unassigned 43,208,401 - - - - 43,208,401 Total fund balances 178,613,393 86,380,858 36,802,822 19,594,192 285,677,603 607,068,868
Total liabilities, deferred
inflows of resources and fund 205,322,028$ 87,320,302 $ 84,511,384 $ 40,197,273 $ 295,987,032 $ 713,338,019 $ Special Revenue Funds
City of Stockton
Balance Sheet
Governmental Funds
June 30, 2022
Major Funds
See accompanying Notes to the Basic Financial Statements. 22 ATTACHMENT A
Total Fund Balances - Total Governmental Funds 607,068,868$ Amounts reported for governmental activities in the Statement of Net Position are different because:

Non-depreciable (net of $22,097,132 reported in the Internal Service Funds) 212,525,973 566,368,589
197,665,965
Compensated absences (net of $438,989 reported in Internal Service Funds) (11,516,212) (57,582,100)
(1,651,082)
(313,515,372)
59,814,713
(162,705,190)
Unavailable revenue - other 20,692,380
Net position of governmental activities 1,117,166,532$
Long-term liabilities were not due and payable in the current period. Therefore, the y were not reported in the Governmental funds' Balance Sheet.

Capital assets used in governmental activities are not financial resources, and therefore, are not reported in the governmental funds.

Revenues which are unavailable on the Fund Balance Sheet, because they are not available currently, are taken into revenue in the Statement of Activities:

Aggregate net pension liability is not due and payable in the current period and therefore is not required to be reported in the governmental funds.

Actuarially determined pension deferred outflows of resources are reported in the government-wide statements but are not reported in the governmental funds.

Actuarially determined pension deferred inflows of resources are reported in the government-wide statements but are not reported in the governmental funds.

Depreciable and amortizable(net of accumulated depreciation and amortization $440,331,590, and net capital assets $21,623,192 reported in the Internal Service Funds) Bonds payable and other long-term debt (net of $202,160 in leases reported in Internal Service Funds) Accrued interest payable (net of $15,066 reported in Internal Service Funds) City of Stockton
Reconciliation of the Balance Sheet of Governmental Funds to the Government-Wide Statement of Net Position
June 30, 2022
Internal Service Funds are used by management to charge the costs of certain activities to individual funds. The assets and liabilities of internal service funds are included in governmental activities in the Government-Wide Statement of Net Position.

See accompanying Notes to the Basic Financial Statements. 23 ATTACHMENT A
Capital Projects
Federal Total
General Housing Special Capital Other Governmental
Fund Grants Grants Improvement Governmental Funds
REVENUES:

Taxes:

Property 41,066,425$ -$ -$ -$ -$ 41,066,425$ Utility user 38,328,240 - - - - 38,328,240 Sales - levied by City 45,412,129 - - - 37,538,549 82,950,678 Franchise fees 17,925,299 - - - 2,006,664 19,931,963 Business license 14,024,356 - - - 1,881,035 15,905,391 Hotel/motel room 3,619,973 - - - - 3,619,973 Document transfer 1,625,553 - - - - 1,625,553 Other 4,015,502 - - - - 4,015,502 Licenses and permits 510,976 - - - 8,617,682 9,128,658 Intergovernmental:

Federal grants and subsidies 364,918 1,942,469 72,680,699 9,823,884 247 84,812,217 Sales and use tax - levied by state 76,238,894 - - - - 76,238,894 Other governmental 41,533,967 1,994,047 16,996,148 3,560,658 21,576,997 85,661,817 Charges for services 10,016,145 2,625 - - 29,513,639 39,532,409 Fines and forfeitures 1,876,711 - - - 124,671 2,001,382 Use of money and property 8,301,161 1,249,320 - - 404,467 9,954,948 Interest income (loss) (6,752,234) (24,696) (575,956) (45,931) (6,274,017) (13,672,834) Refunds and reimbursements 219,469 - - - 330,564 550,033 Miscellaneous 5,642,210 - 19,653 58,410 2,537,993 8,258,266 Total revenues 303,969,694 5,163,765 89,120,544 13,397,021 98,258,491 509,909,515 EXPENDITURES:

Current:

General government 19,999,475 2,504,918 41,098,830 413 13,226,847 76,830,483 Public safety 184,498,997 - 4,958,550 - 16,649,380 206,106,927 Public works 17,336,248 - 76,737 230 16,850,013 34,263,228 Library 11,515,728 - 575,571 - 2,567,149 14,658,448 Parks and recreation 10,292,742 - 30,732 - 4,228,315 14,551,789 Capital outlay 468,869 - 6,675,212 40,746,924 5,142,455 53,033,460 Debt service:

Principal retirement 29,088 1,750,000 - - 164,013 1,943,101 Interest and fiscal charges 16,003 135,771 - - 7,245,358 7,397,132 Total expenditures 244,157,150 4,390,689 53,415,632 40,747,567 66,073,530 408,784,568

EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES 59,812,544 773,076 35,704,912 (27,350,546) 32,184,961 101,124,947 OTHER FINANCING SOURCES (USES):

Transfers in - - - 20,003,898 7,613,898 27,617,796 Transfers out (12,235,569) (398,809) (1,500,000) (598,214) (12,747,667) (27,480,259) Proceeds from issuance of debt 162,530 - - - - 162,530 Proceeds from sale of capital assets 16,769 - - - - 16,769 Total other financing sources (uses) (12,056,270) (398,809) (1,500,000) 19,405,684 (5,133,769) 316,836 CHANGES IN FUND BALANCES 47,756,274 374,267 34,204,912 (7,944,862) 27,051,192 101,441,783 FUND BALANCES:

Beginning of year 130,857,119 86,006,591 2,597,910 27,539,054 258,626,411 505,627,085 End of year 178,613,393$ 86,380,858 $ 36,802,822 $ 19,594,192 $ 285,677,603 $ 607,068,868 $ Special Revenue Funds
Major Funds
City of Stockton
Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 24 ATTACHMENT A
Net change in fund balances - Total Governmental Funds: 101,441,783$ Amounts reported for governmental activities in the Statement of Activities are different because:

Capital outlays (net of $8,388,557 in Internal Service Fund and net $9,248,365 expensed) 43,785,095 Net transfer of capital assets to the internal service fund (6,015,680) Capital asset disposals, net (149,184)
(19,305,268)
Repayment of principal, net of $256,440 in Internal Service Fund 1,943,101 Issuance of debt (162,530)
3,571,937
Change in compensated absences (net of $167,816 in Internal Service Fund) 993,873 (454,502)
Change in unavailable revenue - other 10,277,764
Changes in deferred outflows, deferred inflows, and net pension liability 52,632,207 Changes in net position of governmental activities 188,558,596$ City of Stockton
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Government-Wide Statement of Activities For the Year Ended June 30, 2022
Change in accrued interest
Internal service funds are used by management to charge the costs of certain activities, such as central garage, equipment and insurance, to individual funds. The net revenue (expense) of internal service funds is reported with governmental activities. Excluding extraordinary items as a result of remeasurement of liabilities .

The amounts below included in the Statement of Activities do not provide or (require) the use of current financial resources and therefore are not reported as revenue or expenditure in governmental funds (net change):

Governmental funds report capital outlays as expenditures. Donated capital assets do not create or use financial resources, and are not reported in governmental funds. However, in the statement of activities, the cost/fair value of those assets are allocated over their estimated useful lives and reported as depreciation expense. Capital outlays, donated capital assets, capital asset disposals, loss from disposal of capital assets and depreciation expense are as follows:

Long-term debt (including refunding debt), net of bond premiums and discounts, provides current financial resources to governmental funds, but issuing debt increases long-term liabilities in the statement of net assets. Repayment of principal (including bond refundings) and costs of issuance are expenditures in the governmental funds, but the repayment reduces long-term liabilities in the statement of net assets, and the costs of issuance increase deferred charges in the statement of net assets. Long-term debt proceeds, bond premiums, discounts, repayment of principal, costs of issuance and bond refundings are as follows:

Depreciation and amortization expenses (net of depreciation and amortization $4,803,694 reported in Internal Service Funds)
See accompanying Notes to the Basic Financial Statements. 25 ATTACHMENT A
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26 ATTACHMENT A
Proprietary Fund Types
The City's major enterprise funds include:

Water Utility Enterprise Fund
Wastewater Utility Enterprise Fund
The City's nonmajor enterprise funds include:

Stormwater Utility Enterprise Fund
Parking Authority Enterprise Fund
Downtown Marina Enterprise Fund
Golf Courses Enterprise Fund
To accoun
t for resources an d activities associated wit h the operations an d maintenance of the Downtow n Stockton Marina facilities.

To account for resources and activities associated with the improvement, operation and maintenance of the Swenson golf course.

To account for activities associated with the acquisition or construction, operation and maintenance of off-street parking facilities, and operations related to the provision of services.

PROPRIETARY FUND FINANCIAL STATEMENTS
Proprietary funds focus on the determinatio n of operating income, changes in net positions, financial position, and cash flows. There are two different types: enterprise funds and the internal service funds. Enterprise funds are used to report activities for which a fee is charged to external users for goods and services. Internal service funds may be used to report any activity that provides goods and services on a cost-reimbursement basis to other City funds, departments, or agencies of the primary government and its component units, or to other governments. The City's internal service funds include: General Liability Insurance, Workers' Compensation Insurance, Employee and Retiree Health Insurance, Retirement Benefits, Other Benefits and Insurance, Vehicle Fleet Equipment, Computer Equipment, Radio Equipment, and Other Equipment funds.

To account for activities associated with the acquisition or construction of water treatment facilities, production, distribution and transmission of
potable water to users, and operations related to the provision of services.

To account for activities associated with the acquisition or construction, and operation and maintenance of wastewater facilities for collection, treatment, and disposal of wastewater, and operations related to the provision of services.

To account for activities associated with the acquisition or construction, and operation and maintenance of stormwater facilities for drainage and disposal of stormwater, and operations related to the provision of services. 27 ATTACHMENT A
Water Wastewater Stormwater Parking
Utility Utility Utility Authority
ASSETS
Current assets:

Cash and investments 98,869,245$ 127,584,051$ 9,373,274$ 2,911,294$ Receivables, net:

Interest 236,060 308,211 21,991 9,189 Accounts and other receivables 13,961,175 11,028,300 674,665 - Lease - due in one year - - - - Loans to other funds - current - - - - Due from other governments, net 569,530 - - - Inventory of supplies - 2,046,281 - - Deposits and advances - - - 89,521 Prepaids items 1,205,434 374,595 61,708 - Total current assets 114,841,444 141,341,438 10,131,638 3,010,004 Noncurrent assets:

Restricted assets:

Cash and investments - - - - Cash and investments with fiscal agents 25 1,771,253 - 4,694,171 Lease - due in more than one year
Loans to other funds - long-term - - - - Loans receivable - - - 190,000 Capital assets, net:

Nondepreciable 11,839,331 190,744,330 1,527,164 4,094,963 Depreciable and amortizable, net 282,857,550 244,791,145 40,080,096 21,578,304 Total noncurrent assets 294,696,906 437,306,728 41,607,260 30,557,438 Total assets 409,538,350 578,648,166 51,738,898 33,567,442

DEFERRED OUTFLOWS OF RESOURCES
Unamortized loss on refunding of debt 11,994,982 1,223,060 - 427,240 Pens
ion-related deferred outflows 812,514 2,031,296 145,454 - Total deferred outflows of resources 12,807,496 3,254,356 145,454 427,240 City of Stockton
Statement of Net Position
Proprietary Funds
June 30, 2022
Major Enterprise Funds Nonmajor Enterprise Funds
See accompanying Notes to the Basic Financial Statements. 28 ATTACHMENT A
Governmental
Downtown Golf Activities
Marina Courses Totals Internal Service
ASSETS
Current assets:

Cash and investments 321,204$ 156,166$ 239,215,234$ 141,709,895$ Receivables, net:

Interest 241 18 575,710 560,417 Accounts and other receivables 12,250 7,763 25,684,153 340,460 Lease - due in one year - 26,337 26,337 - Loans to other funds - current - - - 1,592,922 Due from other governments, net - - 569,530 - Inventory of supplies - - 2,046,281 179,726 Deposits and advances - - 89,521 557,996 Prepaids items 788 761 1,643,286 2,931,782 Total current assets 334,483 191,045 269,850,052 147,873,198 Noncurrent assets:

Restricted assets:

Cash and investments - - - 69,968,331 Cash and investments with fiscal agents - - 6,465,449 - Lease - due in more than one year 33,074 33,074 - Loans to other funds - long-term - - - 7,733,072 Loans receivable - - 190,000 - Capital assets, net:

Nondepreciable - 359,805 208,565,593 22,097,132 Depreciable and amortizable, net 20,781,823 504,156 610,593,074 21,623,192 Total noncurrent assets 20,781,823 897,035 825,847,190 121,421,727 Total assets 21,116,306 1,088,080 1,095,697,242 269,294,925

DEFERRED OUTFLOWS OF RES
OURCES
Unamortized loss on refunding of debt - - 13,645,282 - Pension-related deferred outflows - - 2,989,264 - Total deferred outflows of resources - - 16,634,546 - Proprietary Funds
Statement of Net Position (Continued)
City of Stockton
June 30, 2022
Nonmajor Enterprise Funds
See accompanying Notes to the Basic Financial Statements. 29 ATTACHMENT A
Water Wastewater Stormwater Parking
Utility Utility Utility Authority

LIABILITIES
Current liabilities:

Accounts payable 1,505,438 17,148,470 451,571 23,834
Accrued payroll 372,241 830,295 92,861 22,815 Loans from other funds - current - - - 643,105 Due to other governments 95,237 - - - Deposits and other liabilities 1,857,613 1,250,176 104,000 - Retention payable 8,202 840,687 2,312 -
Unearned revenue - - - - Accrued interest 2,060,895 1,161,251 - 448,253 Compensated absences - current 410,375 498,985 4,057 3,792 Lease payable - due in one year - 4,382 - 169,052 Self-insurance claims and judgments - current - - - - Bonds payable - current 6,205,000 4,410,000 - 360,000 Total current liabilities 12,515,001 26,144,246 654,801 1,670,851 Noncurrent liabilities:

Compensated absences - long-term 252,192 267,861 - 2,644 Lease payable - due in more than one year - 732 - 2,473,581 Self-insurance claims and judgments - long-term - - - - Loans from other funds - long-term - - - 6,368,227 Certificates of participation - 152,578,863 - - Bonds payable 189,756,335 - - 28,922,846 Net pension liability 2,282,776 5,698,153 410,445 -
Total noncurrent liabilities 192,291,303 158,545,609 410,445 37,767,298 Total liabilities 204,806,304 184,689,855 1,065,246 39,438,149

DEFERRED INFLOWS OF RES
OURCES
Pension-related deferred inflows 1,906,687 3,961,003 504,876 - Leases - - - - Total deferred inflows of resources 1,906,687 3,961,003 504,876 -

NET POSITION
Net investment in capital assets 110,722,326 278,924,603 41,604,948 (3,351,391) Restricted for capital projects 25 8,094,826 - 3,003,179 Restricted for debt service - 12,604,988 - 1,690,993 Restricted for pensions - - - - Unrestricted (deficit) 104,910,504 93,627,247 8,709,282 (6,786,248) Total net position 215,632,855$ 393,251,664 $ 50,314,230 $ (5,443,467) $ Major Enterprise Funds Nonmajor Enterprise Funds
June 30, 2022
City of Stockton
Statement of Net Position (Continued)
Proprietary Funds
See accompanying Notes to the Basic Financial Statements. 30 ATTACHMENT A
Governmental
Downtown Golf Activities
Marina Courses Totals Internal Service

LIABILITIES
Current liabilities:

Accounts payable 53,421 49,673 19,232,407 3,215,242 Accrued payroll - 1,602 1,319,814 489,104 Loans from other funds - current - - 643,105 454,217 Due to other governments - - 95,237 - Deposits and other liabilities 36,889 - 3,248,678 49,104 Retention payable - - 851,201 - Unearned revenue - - - - Accrued interest - - 3,670,399 15,066 Compensated absences - current - - 917,209 263,366 Lease payable - due in one year - - 173,434 50,116 Self-insurance claims and judgments - current - - - 12,978,791 Bonds payable - current - - 10,975,000 - Total current liabilities 90,310 51,275 41,126,484 17,515,006 Noncurrent liabilities:

Compensated absences - long-term - - 522,697 175,623 Lease payable - due in more than one year - - 2,474,313 152,044 Self-insurance claims and judgments - long-term - - - 52,421,442 Loans from other funds - long-term - - 6,368,227 1,364,845 Certificates of participation - - 152,578,863 - Bonds payable 10,870,821 - 229,550,002 - Net pension liability - - 8,391,374 - Total n
oncurrent liabilities 10,870,821 - 399,885,476 54,113,954 Total liabilities 10,961,131 51,275 441,011,960 71,628,960

DEFERRED INFLOWS OF RESOURCES
Pension-related deferred inflows - - 6,372,566 - Leases 59,083 59,083 -
Total deferred inflows of resources - 59,083 6,431,649 -

NET POSITION
Net investment in capital assets 9,911,002 863,961 438,675,449 43,720,324 Restricted for capital projects - - 11,098,030 - Restricted for debt service - - 14,295,981 - Restricted for pensions - - - 69,968,331 Unrestricted (deficit) 244,173 113,761 200,818,719 83,977,310 Total net position 10,155,175$ 977,722 $ 664,888,179 $ 197,665,965 $ Nonmajor Enterprise Funds
City of Stockton
Statement of Net Position (Continued)
Proprietary Funds
June 30, 2022
See accompanying Notes to the Basic Financial Statements. 31 ATTACHMENT A
Water Wastewater Stormwater Parking
Utility Utility Utility Authority
OPERATING REVENUES:

Charges for services 58,600,917$ 76,884,317$ 5,986,893$ 4,306,876$ Miscellaneous 7,411,908 1,624,610 149,909 - Total operating revenues 66,012,825 78,508,927 6,136,802 4,306,876 OPERATING EXPENSES:

Operation and maintenance 17,850,913 42,294,459 3,022,984 2,883,994 General and administrative 4,260,846 8,899,307 2,580,848 586,120 Depreciation and amortization 7,861,294 12,632,253 1,684,553 1,053,748 Purchased water 16,286,908 - - - Total operating expenses 46,259,961 63,826,019 7,288,385 4,523,862 OPERATING INCOME (LOSS) 19,752,864 14,682,908 (1,151,583) (216,986) NONOPERATING REVENUES (EXPENSES):

Taxes - - - 1,383,392 Grants and subsidies 47,298 2,253,527 - 198,735 Investment income:

Interest income (loss) (2,741,887) (3,878,456) (280,686) (110,815) Interest expense and fiscal charges (8,271,731) (3,164,634) - (1,163,235) Other nonoperating revenues - - - - Total nonoperating revenues (expenses) (10,966,320) (4,789,563) (280,686) 308,077

INCOME (LOSS) BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS 8,786,544 9,893,345 (1,432,269) 91,091 CONTRIBUTIONS AND TRANSFERS:

Capital contributions 7,399,219 3,943,458 - - Developer contributions 294,172 211,618 383,023 - Transfers in - - - - Trans
fers out (19,650) (622,808) (293,333) - Total contributions and transfers 7,673,741 3,532,268 89,690 - CHANGES IN NET POSITION 16,460,285 13,425,613 (1,342,579) 91,091 NET POSITION:

Beginning of year, as restated (Note 19) 199,172,570 379,826,051 51,656,809 (5,534,558) End of year 215,632,855$ 393,251,664 $ 50,314,230 $ (5,443,467) $ Major Enterprise Funds Nonmajor Enterprise Funds
City of Stockton
Statement of Revenues, Expenses, and Changes in Net Position Proprietary Funds
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 32 ATTACHMENT A
Governmental
Downtown Golf Activities
Marina Courses Totals Internal Service
OPERATING REVENUES:

Charges for services 358,015$ -$ 146,137,018$ 151,999,101$ Miscellaneous 37,321 32,394 9,256,142 15 Total operating revenues 395,336 32,394 155,393,160 151,999,116 OPERATING EXPENSES:

Operation and maintenance 566,771 - 66,619,121 131,845,744 General and administrative 5,756 170,766 16,503,643 7,736,578 Depreciation and amortization 532,956 99,241 23,864,045 4,803,694 Purchased water - - 16,286,908 - Total operating expenses 1,105,483 270,007 123,273,717 144,386,016 OPERATING INCOME (LOSS) (710,147) (237,613) 32,119,443 7,613,100 NONOPERATING REVENUES (EXPENSES):

Taxes - - 1,383,392 - Grants and subsidies - - 2,499,560 - Investment income:

Interest income (loss) (3,569) (2,774) (7,018,187) (11,878,728) Interest expense and fiscal charges - - (12,599,600) (42,382) Other nonoperating revenues - - - 1,563,713 Total nonoperating revenues (expenses) (3,569) (2,774) (15,734,835) (10,357,397)

INCOME (LOSS) BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS (713,716) (240,387) 16,384,608 (2,744,297) CONTRIBUTIONS AND TRANSFERS:

Capital contributions - - 11,342,677 6,015,680 Developer contributions - - 888,813 - Tra
nsfers in 262,000 235,700 497,700 300,554 Transfers out - - (935,791) - Total contributions and transfers 262,000 235,700 11,793,399 6,316,234 CHANGES IN NET POSITION (451,716) (4,687) 28,178,007 3,571,937 NET POSITION:

Beginning of year, as restated (Note 19) 10,606,891 982,409 636,710,172 194,094,028 End of year 10,155,175$ 977,722 $ 664,888,179 $ 197,665,965 $ Nonmajor Enterprise Funds
City of Stockton
Statement of Revenues, Expenses, and Changes in Net Position (Continued) Proprietary Funds
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 33 ATTACHMENT A
Water Wastewater Stormwater Parking
Utility Utility Utility Authority
CASH FLOWS FROM OPERATING ACTIVITIES:

Receipts from customers and users 56,784,060$ 80,815,091$ 6,270,219$ 4,306,974$ Receipts for interfund services provided - - - - Payments to suppliers and employees (40,273,637) (51,587,006) (5,575,227) (3,481,634) Miscellaneous receipts 7,411,908 1,624,610 149,909 - Net cash provided by (used in) operating activities 23,922,331 30,852,695 844,901 825,340 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:

Transfers in (out), net (19,650) (622,808) (293,333) - Loans to and from other funds - - - (629,841) Receipt of cash subsidies and federal grants 47,298 2,253,527 - - Other nonoperating revenues - - - - Proceeds from taxes - - - 1,582,127 Net cash provided by (used in) noncapital financing activities 27,648 1,630,719 (293,333) 952,286

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Proceeds from sale of capital assets 55,383 58,237 1,548 - Purchases of capital assets (4,255,530) (67,911,245) (1,238,480) (204,691) Capital contributions received 7,693,391 4,155,076 383,023 - Proceeds from issuance of debt - 108,008,758 - - Principal paid on debt (6,720,073) (123,438,626) - (607,446) Unamortized loss on refunding of debt and discount 721,388 170,584 - - Interest paid on debt (8,341,584) (2,940,811) - (1,169,284) Net cash (used in) capital and related financing activities (10,847,025) (81,898,027) (853,909) (1,981,421) CASH FLOWS FROM INVESTING ACTIVITIES:

Investment earnings (loss) (2,786,345) (3,831,987) (278,801) (112,477)
Net cash provided by (used in) investing activities (2,786,345) (3,831,987) (278,801) (112,477) 10,316,609 (53,246,600) (581,142) (316,272) CASH AND CASH EQUIVALENTS:

Beginning of year 88,552,661 182,601,904 9,954,416 7,921,737 End of year 98,869,270$ 129,355,304 $ 9,373,274 $ 7,605,465 $ City of Stockton
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2022
Major Enterprise Funds Nonmajor Enterprise Funds

NET INCREASE (DECREASE) IN CASH AND CASH

EQUIVALENTS
See accompanying Notes to the Basic Financial Statements. 34 ATTACHMENT A
Governmental
Downtown Golf Activities
Marina Courses Totals Internal Service
CASH FLOWS FROM OPERATING ACTIVITIES:

Receipts from customers and users 447,848$ (8,091)$ 148,616,101$ -$ Receipts for interfund services provided - - - 152,502,465 Payments to suppliers and employees (636,476) (290,289) (101,844,269) (140,856,919) Miscellaneous receipts 37,321 32,394 9,256,142 (915,393) Net cash provided by (used in) operating activities (151,307) (265,986) 56,027,974 10,730,153 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:

Transfers in (out), net 262,000 235,700 (438,091) 234,575 Due to and from other funds - (629,841) 610,601 Receipt of cash subsidies and federal grants 12 2,300,837 - Other nonoperating revenues - - 1,718,154 Proceeds from taxes - 1,582,127 - Net cash provided by (used in) noncapital financing activities 262,000 235,712 2,815,032 2,563,330

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Proceeds from sale of capital assets - - 115,168 - Purchases of capital assets (78,819) - (73,688,765) (8,388,559) Capital contributions received - - 12,231,490 - Proceeds from issuance of debt - - 108,008,758 - Principal paid on debt - - (130,766,145) (256,440) Unamortized loss on refunding of debt - - 891,972 - Interest paid on debt - - (12,451,679) (51,674) Net cash (used in) capital and related financing activities (78,819) - (95,659,201) (8,696,673) CASH FLOWS FROM INVESTING ACTIVITIES:

Investment earnings (loss) (3,498) (1,922) (7,015,030) (12,007,502)
Net cash provided by (used in) investing activities (3,498) (1,922) (7,015,030) (12,007,502) 28,376 (32,196) (43,831,225) (7,410,692) CASH AND CASH EQUIVALENTS:

Beginning of year 292,828 188,362 289,511,908 219,088,917 End of yea
r 321,204$ 156,166$ 245,680,683$ 211,678,225$ City of Stockton
Nonmajor Enterprise Funds

NET INCREASE (DECREASE) IN CASH AND CASH

EQUIVALENTS
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2022
See accompanying Notes to the Basic Financial Statements. 35 ATTACHMENT A
Water Wastewater Stormwater Parking
Utility Utility Utility Authority

RECONCILIATION OF CASH AND CASH EQUIVALENTS

TO THE STATEMENT OF NET POSITION -
PROPRIETARY FUNDS:

Cash and investments 98,869,245$ 127,584,051$ 9,373,274$ 2,911,294$ Restricted assets:

Cash and investments - - - - Cash and investments with fiscal agents 25 1,771,253 - 4,694,171 Total cash and investments 98,869,270$ 129,355,304 9,373,274 $ 7,605,465 $

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

Operating income (loss) 19,752,864 $ 14,682,908 $ (1,151,583) $ (216,986) $ Adjustments to reconcile operating income (loss)
to net cash provided by (used for) operating activities:

Depreciation and amortization 7,861,294 12,632,253 1,684,553 1,053,748 Changes in assets and liabilities:

Accounts receivables (1,816,857) 3,930,774 283,326 98 Due from other funds - - - - Prepaid items (105,017) (131,268) (8,873) - Lease receivable - - - - Lease related deferred inflows - - - - Inventory of supplies - (182,931) - - Deposits and advances - - - (4,586) Accounts payable (944,155) 937,381 170,892 8,319 Accrued payroll 5,330 10,689 (6,700) (1,512) Due to other funds - - - - Deposits and other liabilities (119,745) 1,157,125 (5,999) - Compensated absences (36,166) (90,973) (12,395) (13,741) Self-insurance - claims and judgments - - - - Net pension liability (2,126,781) (4,662,564) (593,386) - Pension-related deferred outflows (105,968) (370,547) 15,248 - Pension-related deferred inflows 1,557,532 2,939,848 469,818 - Net cash
provided by (used in) operating activities 23,922,331$ 30,852,695 $ 844,901 $ 825,340 $ NONCASH TRANSACTIONS:

Amortization of loss on refunding 721,388 $ 170,584 $ - $ (427,240)$ Capital contributions received 294,172 211,618 383,023 - Total noncash capital and related financing activities 1,015,560$ 382,202 $ 383,023 $ (427,240) $ Major Enterprise Funds
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2022
City of Stockton
See accompanying Notes to the Basic Financial Statements. 36 ATTACHMENT A
Governmental
Downtown Golf Activities
Marina Courses Totals Internal Service

RECONCILIATION OF CASH AND CASH EQUIVALENTS

TO THE STATEMENT OF NET POSITION -
PROPRIETARY FUNDS:

Cash and investments 321,204$ 156,166$ 239,215,234$ 141,709,895$ Restricted assets:

Cash and investments - - - 69,968,331 Cash and investments with fiscal agents - - 6,465,449 - Total cash and investments 321,204$ 156,166$ 245,680,683$ 211,678,226$

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

Operating income (loss) (710,147)$ (237,613)$ 32,119,443$ 7,613,100$ Adjustments to reconcile operating income (loss)
to net cash provided by (used for) operating activities:

Depreciation and amortization 532,956 99,241 23,864,045 4,803,694 Changes in assets and liabilities:

Accounts receivables 89,833 (7,763) 2,479,411 199,709 Due from other funds - - 303,640 Prepaid items 23,450 - (221,708) (893,829) Lease receivable - 26,279 26,279 - Lease related deferred inflows - (26,607) (26,607) - Inventory of supplies - - (182,931) (179,726) Deposits and advances - - (4,586) 349,235 Accounts payable (55,983) (119,529) (3,075) (417,891) Accrued payroll - 6 7,813 35,429 Due to other funds - -
Deposits and other liabilities (31,416) - 999,965 - Compensated absences - - (153,275) (167,815) Self-insurance - claims and judgments - - - (915,393) Net pension liability - - (7,382,731) - Pension-related deferred outflows - - (461,267) - Pension-related deferred inflows - - 4,967,198 - Net cash
provided by (used in) operating activities (151,307)$ (265,986) $ 56,027,974 $ 10,730,153 $ NONCASH TRANSACTIONS:

Amortization of loss on refunding - $ - $ 464,732$ - $ Capital contributions received - - 888,813 6,015,680 Total noncash capital and related financing activities -$ - $ 1,353,545$ 6,015,680 $ For the Year Ended June 30, 2022
City of Stockton
Nonmajor Enterprise Funds
Statement of Cash Flows (Continued)
Proprietary Funds
See accompanying Notes to the Basic Financial Statements. 37 ATTACHMENT A
This page intentionally left blank.
38 ATTACHMENT A
Fiduciary Fund Types
Custodial Funds
Successor Agency to the Redevelopment Agency of the City of Stockton

FIDUCIARY FUND FINANCIAL STATEMENTS
The fiduciary funds are used to report assets hel d in a trustee or agenc y capacity for others and which, therefore, cannot be used to support the government's own programs. The financial activities of these funds are excluded from the government-wide financial statements, but are presented in separate Fiduciary Funds financial statements. The fiduciary funds category includes custodial funds and private-purpose trust funds.

To accoun
t for land secured financing, developer area of benefit fees, pass-thru public fees on behalf of othe r entities, funds held in trust as security for development projects, and various community enhancement programs the City administers on behalf of other entities.

To account for a separate legal entity, which was formed to hold the assets and liabilities of the former Redevelopment Agency pursuant to the City Council actions taken on August 23, 2011. The nature and significance of the relationship between the City and the Successor agency is such that it would be misleading to exclude the Successor Agency from the City’s financial statements. The Successor Agency is presented herein in the City’s fiduciary funds as a private-purpose trust fund. 39 ATTACHMENT A
Successor
Agency to the
Redevelopment
Agency
Custodial Private-Purpose
Funds Trust Fund
ASSETS
Cash and investments 25,215,598$ 10,088,400 $
Cash and investments with fiscal agents 6,472,600 3 Receivables, net:

Interest 62,272 23,027
Accounts and other receivables 3, 662,249 561 Lease - 41,321
Capital assets:

Nondepreciable - 12,231,979
Depreciable and amortizable, net - 11,965,731 Total assets 35,412,719 34,351,022

LIABILITIES
Accounts payable 24,294 -
Accrued payroll - 3,909
Due to other governments 2,950,173 -
Loans from the City - 1,106,580 Accrued interest - 1,219,012 Bonds payable - current - 4,370,555 Bonds payable - noncurrent - 86,898,487 Pollution remediation - 275,000 Total liabilities 2,974,467 93,873,543
Deferred Inflows of Resources
Lease - 41,114
Total deferred inflows of resources - 41,114

NET POSITIONS
Held in Trust - (59,563,635) Restricted for individual, organization, and other governments 32,438,252 - Total net positions 32,438,252$ (59,563,635) $ City of Stockton
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2022
See accompanying Notes to the Basic Financial Statements. 40 ATTACHMENT A
Successor
Agency to the
Redevelopment
Agency
Custodial Private-Purpose
Funds Trust Fund
ADDITIONS:

Property tax 7,844,621$ 10,086,063$
Use of money and property 87 6,957 Investment income (loss) (824,783) (304,033)
Gain on disposal of capital assets - 378,011 Miscellaneous - 1,449,265
Total additions 7,019,925 11,616,263
DEDUCTIONS:

General government 373,760 249,930
Public Works 7,526,952 -
Debt obligations 7,362,720 3,139,799
Depreciation and amortization - 573,834 Miscellaneous - 6,346,648
Total deductions 15,263,432 10,310,211
CHANGE IN NET POSITION (8,243,507) 1,306,052
NET POSITION (DEFICIT):

Beginning of year, as restated (Note 19) 40,681,759 (60,869,687) End of year 32,438,252$ (59,563,635) $
City of Stockton
Statement of Changes in Fiduciary Net Position
For the Year Ended June 30, 2022
Fiduciary Funds
See accompanying Notes to the Basic Financial Statements. 41 ATTACHMENT A
This page intentionally left blank.
42 ATTACHMENT A

NOTES TO BASIC FINANCIAL STATEMENTS

ATTACHMENT A

ATTACHMENT A
City of Stockton
Index to the Notes to the Basic Financial Statements
For the Year Ended June 30, 2022

43 Note 1 – Summary of Significant Accounting Policies ...................................................................................... 45

A. Financial Reporting Entity ................................................................................................................... 45 B. Basis of Presentation, Measurement Focus and Basis of Accounting ................................................. 46 C. Deferred Outflows/Inflows of Resources ............................................................................................ 50 D. Encumbrances ...................................................................................................................................... 50 E. Cash, Cash Equivalents, and Investments ............................................................................................ 50 F. Restricted Cash and Investments ......................................................................................................... 51 G. Fair Value Measurement ...................................................................................................................... 51 H. Receivables .......................................................................................................................................... 51 I. Interfund Loans and Advances ............................................................................................................ 52 J. Inventory of Supplies ........................................................................................................................... 52 K. Prepaid Items ....................................................................................................................................... 52 L. Lease Receivable ................................................................................................................................. 52 M. Capital Assets ................................................................................................................ ...................... 53 N. Capital Contributions ........................................................................................................................... 54 O. Accrued Payroll and Related Liabilities .............................................................................................. 54 P. Accrued Compensated Absences ......................................................................................................... 54 Q. Long-Term Debt .................................................................................................................................. 55 R. Lease Liabilities ................................................................................................................................... 55 S. Pensions ............................................................................................................................................... 55 T. Net Position .................................................................................................................. ....................... 56 U. Fund Balances ...................................................................................................................................... 57 V. Property Taxes ..................................................................................................................................... 57 W. Use of Estimates .................................................................................................................................. 58 X. Implementation of Governmental Accounting Standards Board Pronouncements ............................. 58

Note 2 – Cash, Cash Equivalents and Investments ............................................................................................ 60 A. Cash Deposits ...................................................................................................................................... 60 B. Authorized Investments ....................................................................................................................... 61 C. Investments in Local Agency Investment Fund ................................................................................... 63 D. Investments in California Asset Management Program (“CAMP”) .................................................... 63 E. Fair Value of Investments .................................................................................................................... 63 F. Risk Disclosures .............................................................................................................. .................... 64 G. Restricted Cash and Investments ......................................................................................................... 67

Note 3 – Interfund Transactions .......................................................................................................................... 68

A. Loans To/From Other Funds ................................................................................................................ 68 B. Transfers .............................................................................................................................................. 69

Note 4 – Lease Receivable ..................................................................................................................................... 70

Note 5 – Successor Agency – Loans from City, Net ............................................................................................ 71

Note 6 – Loans to Property Owners ..................................................................................................................... 72

ATTACHMENT A
City of Stockton
Index to the Notes to the Basic Financial Statements (Continued) For the Year Ended June 30, 2022

44 Note 7 – Capital Assets .......................................................................................................................................... 73

A. Government-Wide Financial Statements ............................................................................................. 73 B. Governmental Activities ...................................................................................................................... 74 C. Business-Type Activities ..................................................................................................................... 75 D. Fiduciary Fund Activities .................................................................................................................... 76

Note 8 – Long-Term Liabilities ............................................................................................................................ 77

A. Governmental Activities ...................................................................................................................... 77 B. Business-Type Activities ..................................................................................................................... 81 C. Fiduciary Fund Activities .................................................................................................................... 87 D. Debt Without City Commitment .......................................................................................................... 88 E. Conduit Debt ........................................................................................................................................ 89

Note 9 – Accrued Compensated Absences ........................................................................................................... 89

Note 10 – Unamortized Loss on Refunding ......................................................................................................... 90

Note 11 – Fund Balances ....................................................................................................................................... 90

Note 12 – Retirement Plans .............................................................................................................................. .... 91

A. CalPERS Retirement Plan ....................................................................................................... ............ 92 B. PARS Enhancement Plan ..................................................................................................................... 98 C. Retirement Benefits Fund (Section 115 Trust) .................................................................................. 102

Note 13 – Claims Payable .............................................................................................................................. ..... 102

Note 14 – Pollution Remediation Obligations ................................................................................................... 104

Note 15 – Individual Fund Disclosures .............................................................................................................. 104

Note 16 – Commitments and Contingencies ..................................................................................................... 105

Note 17 – Restricted Net Position ....................................................................................................................... 107

Note 18 – Subsequent Events .............................................................................................................................. 107

Note 19 – Prior Period Adjustments .................................................................................................................. 107

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements
For the Year Ended June 30, 2022

45 Note 1 – Summary of Significant Accounting Policies

The basic financial statements of the City of Stockton, Ca lifornia (the “City”) have been prepared in accordance with Accounting Principles Generally Accepted in the United States of America (“U.S. GAAP”) as applied to governmental agencies. The Governmental Accounting Standards Boar d (“GASB”) is the accepted standard-setting body for establishing governmental accounting and financial reporting standards in the United States. The more significant of the City’s accounting policies are described below.

A. Financial Reporting Entity

The City was incorporated on July 25, 1850, under the genera l laws of the State of California. Under the charter adopted in 1923, the City operates under a Council-Manager form of government and provides the following services as authorized by its charter: public safety, community services, engineering services, planning services, public works, general administrative services, and capital improvements.

These basic financial statements present the City and its component units, entities for which the City is considered to be financially accountable. The City is considered to be financially account able for an organization if the City appoints a voting majority of that organization’s governing body and either the City can impose its will on that organization, or there is a potential for that organization to provide financial benefits to or impose specific financial burdens on the City. The City is also considered to be financially accountable for an organization if that organization is fiscally dependent (i.e., it is unable to adopt its budget, levy taxes, set rates or charges, or issue bonded debt without approval from the City). In certain cases, other organizations are included as component units if the nature and significance of their relationship with the City are such that their exclusion would cause the City’s financial statements to be misleading or incomplete. Blended component units, although lega lly separate entities are, in substance, part of the City’s operations and data from these units are combined with data of the City. Each blended component unit has a June 30 year-end. The following entities are reported component units:

Fiduciary Component Unit – Successor Agency

The Successor Agency to the Redevelopment Agency of the City of Stockton (“Successor Agency”) is a separate legal entity, which was formed to hold the assets and liabilities of the former Redevelopment Agency under City Council action taken on August 23, 2011. The nature and si gnificance of the relationship between the City and the Successor Agency are such that it woul d be misleading to exclude the Successo r Agency from the City’s financial statements. The Successor Agency is presen ted herein in the City’s fiduciary funds as a private-purpose trust fund for the fiscal year ended June 30, 2022.

The Stockton Public Financing Authority (the “SPFA”)

The SPFA was created in June 1990 and carries out bonded de bt and lease financing for the City. The governing body of the SPFA is comprised of City Council members. The SPFA is authorized to borrow money for the purpose of financing the acquisition of bonds, notes and other obliga tions of, or for the purpose of making loans to the City and to refinance outstanding obligations of the City. The SPFA does not prepare separate financial statements.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

46 Note 1 – Summary of Significant Accounting Policies (Continued)

A. Financial Reporting Entity (Continued)

Excluded Agencies

A governmental agency in which the City participates is the San Joaquin Area Flood Control Agency (“SJAFCA”) which is jointly governed by the City and the County of San Joaquin (“County”). The City retains neither an on- going financial interest in nor obligation to SJAFCA. Therefore financial information for the SJAFCA is not included in the accompanying financial statements.

An additional governmental agency in which the City participates is the San Joaquin County Regional Fire Dispatch Joint Powers Authority (“SJCRFDA”) consequent to City Council approval of an operating agreement between the SJCRFDA and the City of Stockton. In addition to di spatch services, the City will provide financial and administrative support services to the SJCRFDA. The financial information for the SJCRFDA is not included in the accompanying financial statements. However, the City’s cost and revenues from providing emergency communications services are tracked and reported in the General Fund. The SJCRFDA was dissolved effective June 30, 2021.

B. Basis of Presentation, Measurement Focus, and Basis of Accounting

The accounts of the City are organized by funds. The operations of each fund are accounted for by providing a separate set of self-balancing accounts that comprise its assets, deferred outflows of resources, liabilities, deferred inflows of resources, fund balance or net position, reve nues and expenditures or expenses, as appropriate. Fund accounting segregates funds according to their intended purpo se and is used to aid management in demonstrating compliance with finance-related legal and contractual provisions. The minimum number of funds is maintained consistent with legal and managerial requirements.

The City’s financial position and results of operations are presented from two perspectives in the following two sets of financial statements:

Government-Wide Financial Statements

The City’s Government-Wide Financial Statements include a Statement of Net Position and a Statement of Activities and Changes in Net Position. These statements present summaries of governmental activities and business-type activities for the City, the primary government, accompanied by a total column. Fiduciary activities of the City are not included in these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support.

The statement of activities demonstrates the degree to which the direct expenses of a given function or programs are offset by program revenues. Direct expenses are those expenses specifically associated with a service, program, or department and, are identifiable with a specific functi on or program. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not included among program revenues are reported as general revenues.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

47 Note 1 – Summary of Significant Accounting Policies (Continued)

B. Basis of Presentation, Measurement Focus, and Basis of Accounting (Continued)

Government-Wide Financial Statements (Continued)

Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds. Fiduciary funds are excluded from the government-wide financial st atements. Major individual governmental funds and enterprise funds are reported as separate columns in the fund financial statements with nonmajor funds aggregated in and combined with the major funds.

The Government-Wide financial statements are presented on an “ economic resources” measurement focus and the accrual basis of accounting. Accordingly, all of the City’s assets, including Capital and Infrastructure assets and long term liabilities are included in the accompanying Statement of Net Position. The Statement of Activities presents the Change in Net Position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred.

Certain types of transactions are reported as program revenues for the City in three categories:

 Charges for services
 Operating grants and contributions
 Capital grants and contributions

Certain eliminations have been made for inter-fund activities, payables, and receivables. All internal balances in the Statement of Net Position have been eliminated except those representing balances between the governmental activities and the business-type activities, which are presented as internal balances and netted in the total primary government column. In the Statement of Activities, internal service fund transactions have been eliminated; however, transactions between governmental and business-type activiti es have not been eliminated and reported as transfers The following inter-fund activities have been eliminated:

 Loans to, Loans from other funds
 Transfers in, Transfers out

Governmental Fund Financial Statements

Governmental fund financial statements include a Balance Sheet and a Statement of Revenues, Expenditures, and Changes in Fund Balances for all major governmental f unds and nonmajor funds aggregated. An accompanying schedule is presented to reconcile and explain the differen ces in fund balances as presented in these statements to the net position presented in the government-wide financial statements.

All governmental funds are accounted for on a spending or “ current financial resources ” measurement focus and the modified accrual basis of accounting. Accordingly, only current assets and current liabilities are included on the Balance Sheet. The Statement of Revenues, Expenditures, and Changes in Fund Balances present increases (revenues and other financing sources) and decreases (expenditures and other financing use) in fund balances.

Revenues are recognized in the accounting period in which they become both “ measurable” and “available” to finance expenditures of the current period. Revenues are considered to be available when they are collectible within the current period as soon enough after that to pay liabilities of the current period. For this purpose, the City considers revenues to be available if they are collected within 90 days of the end of the current fiscal period. The primary revenue sources, which have been treated as susceptible to accrual by the City, are property tax, sales tax, intergovernmental revenues, and other taxes.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

48 Note 1 – Summary of Significant Accounting Policies (Continued)

B. Basis of Presentation, Measurement Focus, and Basis of Accounting (Continued)

Governmental Fund Financial Statements (Continued)

Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt and compensated absences, which are recognized as expenditures to the extent they have matured or been earned. Governmental capital asset acquisitions are reported as expenditures in governmental funds as capital outlay. Proceeds of governmental long-term debt and acquisitions under capital leases are reported as other financing sources. Revenues and expenditures no t meeting recognition criteria are treated as deferred inflows or outflows (Note 1C).

The Reconciliation of the Fund Financial Statements to the Government-Wide Financial Statements is provided to explain the differences.

The City reports the following major governmental funds:

 General Fund
To account for resources not accounted for in another f und. The General Fund is the City's main operating fund reflecting transactions re lated to municipal government al services supported by taxes, intergovernmental revenues, charges for services and other governmental type revenues.

 Federal Housing Grants Special Revenue Fund
To account for federal grant programs and other resour ces that provide for development of a viable urban community by providing a suitable living environment, loans to non-profit housing developers to acquire and rehabilitate abandoned and foreclose homes and providing affordable housing assistance to qualified low- and moderate-income househol ds. This fund includes the City’s annual federal funding from the Community Development Block Grant, Community Re habilitation Loan program, federal revolving loan program, revitalization activities in the designated Urban Development Action Grant area, Housing and Urban Development (HUD) Section 108, (HOME) Housing grants and loans, and Neighborhood Stabilization Loan Program (NSP Funds).

 Special Grants Special Fund
To account for one-time resources received through the federal CARES and American Rescue Plan Act and in addition to some comparatively smaller grants from federal and state governments to support public safety and other community programs which are not otherwise accounted for in other special revenue funds.

 Capital Improvement Capital Projects Fund
To account for the acquisition, construction and improve ment of general governmental capital facilities as required by City Council action or state law in whic h the projects are financed by grants, lease proceeds, and transfers from other City governmental funds.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

49 Note 1 – Summary of Significant Accounting Policies (Continued)

B. Basis of Presentation, Measurement Focus, and Basis of Accounting (Continued)

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 all proprietary funds.

Proprietary funds are accounted for using the “ economic resources” measurement focus and the accrual basis of accounting. Accordingly, all assets and liabilities (whether current or noncurrent) are included on the Statement of Net Position. The Statement of Revenues, Expenses, and Changes in Net Position presents increases (revenues) and decreases (expenses) in total net position. Under the accrua l basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which liability is incurred.

Operating revenues in the proprietary funds are those revenues that are generated from the primary operations of the fund. All other revenues are reported as non-operating revenues. Operating expenses are those expenses that are essential to the primary operations of the fund. All other expenses are reported as non-operating expenses.

The City reports the following major enterprise funds:

 Water Utility Enterprise Fund
To account for activities associated with the acquisiti on or construction of water treatment facilities, production, distribution and transmission of potable water to users, and operations related to the provision of services.

 Wastewater Utility Enterprise Fund
To account for activities associated with the acquisition or construction, and operation and maintenance of wastewater facilities for the collection, treatment, and disposal of wastewater, and operations related to the provision of services.

A column representing internal service funds is also pr esented in these statements. Ho wever, internal service balances and activities have been combined with the governmental activiti es in the government-wide financial statements. Internal service funds are a type of propriet ary fund used to report the provision of goods and services to other funds, departments, or agencies of the primary government and its component units on a cost-reimbursement basis. The City’s internal service funds include eight individual funds which provide services directly to other City funds.

 The Internal Service Funds of the City are the General Liability Insurance, Workers’ Compensation Insurance, Employee Health Insuran ce, Retirement Benefits, Other Benefits and Insurance, Vehicle Fleet Equipment, Computer and Radio Equipment, and Other Equipment funds.

Fiduciary Fund Financial Statements

Fiduciary fund financial statements include a Statement of Net Position and a Statement of Changes in Fiduciary Net Position. The City’s fiduciary funds represent agency funds and private purpose trust funds. Both custodial funds and the private purpose trust funds are accounted for on th e full accrual basis of accounting. The City reports the following fiduciary funds:

The Private Purpose Trust Fund is used to account for the activities of the Successor Agency to the Stockton Redevelopment Agency.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

50 Note 1 – Summary of Significant Accounting Policies (Continued)

B. Basis of Presentation, Measurement Focus, and Basis of Accounting (Continued)

Fiduciary Fund Financial Statements (Continued)

The Custodial Funds account for resources held by the City in custodial capacity for collections to bondholders and for programs that the City administers on behalf of other governmental and private sector entities and organizations. The City is responsible for ensuring th at the assets reported in these funds are used for their intended purposes.

C. 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 of Resources represent a consumption of net position that apply to future periods.

Deferred Inflows of Resources represent an acquisition of net position that apply to future periods.

D. Encumbrances

Encumbrance accounting, under which purchase orders, contracts and other commitments for the expenditure of monies are recorded to reserve that portion of the applicable appropriation, is employed as an extension of budgetary controls.

E. Cash, Cash Equivalents, and Investments

The City pools its available cash for investment purposes. The City considers pooled cash and investment amounts, with original maturities of three months or less, to be cash equivalents. The statement of cash flows requires presentation of “cash and cash equivalents.” For the statement of cash flows, the City considers all proprietary fund pooled cash and investments as “cash and cash equivalents,” including restricted cash held by fiscal agents for debt service and capital projects.

The City participates in an external investment pool mana ged by the State of California (the “State”), the Local Agency Investment Fund (“LAIF”). The City records its i nvestment in LAIF at fair value based on information obtained from the State on the holdings in the pool.

The change in fair value of investments is recognized as an increase or decrease in investment assets and investment income or loss. Investment income (loss) consists of interest income, dividend income, and recognized gains or losses on investments. Money market investments and certain guaranteed investment contracts are carried at cost.

Highly liquid market investments with maturities of one year or less at the time of purchase are stated at amortized cost. All other investments are stated at fair value. Mark et value is used as fair valu e for those securities for which market quotations are readily available. The City allocates the fair value adjustment fo r unrealized gains and losses at June 30 of each year. Interest earnings on investments are allocated to the individual pooled funds quarterly based on each fund’s average quarterly pooled cash and investment s balances. The City reported its investments at fair value, and the unrealized losses on investments amounted to $16,893,214 for the fiscal year ended June 30, 2022.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

51 Note 1 – Summary of Significant Accounting Policies (Continued)

E. Cash, Cash Equivalents, and Investments (Continued)

Certain disclosure requirements, if applicable, for Deposits and Investment Risks in the following areas are presented in the footnotes:

 Interest Rate Risk
 Credit Risk
- Overall
- Custodial Credit Risk
- Concentration of Credit Risk
 Foreign Currency Risk

F. Restricted Cash and Investments

Restricted cash and investments consist of cash and investments held by fiscal agents that are restricted due to limitations on their use by bond covenants or cash or investments with donor limitations. Fiscal agents acting on behalf of the bond investors hold investments arising from the proceeds of long-term debt issuances. The funds may be used for specific capital outlays or for the payment of certain bonds, certificate of participation or tax allocation bonds and have been invested as permitted by specific State statutes or applicable City ordinance, resolution or bond indenture. Cash held in the Water and Wastewater Rate Stabilization Fund was estab lished under the issuance of bonds in 2009 and 2014, respectively.

G. Fair Value 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 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. Levels of inputs are as follows:
 Level 1 – Inputs are unadjusted, quoted prices for id entical assets or liabilities in active markets at the measurement date.

 Level 2 – Inputs, other than quoted prices included in Level 1, that are observable for the assets or liabilities through corroboration with market data at the measurement date.

 Level 3 – Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the assets or liabilities at the measurement date.

H. Receivables

Revenues are recorded when received in cash, except revenues subject to accrual (up to 90 days after year-end) are recognized when due. The primary revenue sources, which ha ve been treated as susceptible to accrual by the City, are sales tax, special assessments, intergovernmental revenues, other taxes, interest revenue, rental revenue and certain charges for services.

Federal and State grants are considered receivable and accrued as revenue when all e ligibility requirements have been met on the accrual basis of accounting in the government-wide statement of net positions. The amount recognized as revenue under the modified accrual basis of accounting in the governmenta l funds is limited to the amount that is deemed measurable and available.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

52 Note 1 – Summary of Significant Accounting Policies (Continued)

H. Receivables (Continued)

Long-term loans receivable, which consist of the principal amount of the loan plus the accrued borrower’s deferred interest is reported in the government al fund statements and classified as rest ricted fund balance as the use of the proceeds from the collection of those receivables was r estricted. Long-term loans receivable reported in the governmental activities on the government-wide statement of net position as it is recorded on an accrual basis at its net realizable value based on an estimate of uncollectible amounts for loan losses.

Billed but not collected and unbilled utility revenue earned is recognized as revenue and accounts receivable in the enterprise funds.

I. Interfund Loans and Advances

Activity between funds that is representative of lending/borrowing arrangements outstanding at the end of the fiscal year is referred to as either “due to/from other funds” (i.e., the current portion of inter-fund loans) or “loans to/from other funds” (i.e., the non-current portion of inter-fund lo ans). All other outstanding balances between funds are reported as “due to/from other funds.” Any residual ba lances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as “internal balances.”

Management has determined that there are some inter-fund balances which may or may not be repaid within a reasonable period. U.S. GAAP permits the reporting of in ter-fund balances such as in ter-fund loans and advances only when repayment is expected within a reasonable period. However, City policy does not permit the elimination of inter-fund balances without City Coun cil approval. Accordingly, inter-fund balances, which are not expected to be repaid within a reasonable period or not at all, have been offset by an allowance for uncollectible advances in both the borrowing and the lending funds.

J. Inventory of Supplies

Inventories consist of expendable suppli es held for consumption. Inventories ar e valued at weighted average cost using the first-in-first-out basis. Inventories of all funds are recorded as expenditures/expenses when consumed rather than purchased. Inventory of supplies is recorded in General Fund as the City’s central store in general and for the entertainment venues as well as in the Wastewater Fund, for the City’s Water, Wastewater, and Stormwater Enterprise Funds which operates as a central store for all of the City’s utilities.

K. Prepaid Items

Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both the government-wide and fund financial statements by using purchase method. A nonspendable fund balance has been reported in the governmental funds to show th at the prepaid items do not constitute “available spendable resources,” even though they are a component of current assets.

L. Lease Receivable

The City is a lessor for leases of land, buildings, and cell towers and recognizes leas es receivable and deferred inflows of resources in the financial statements. Variable payments based on future performance or usage of the underlying asset are not included in the measurement of the lease receivable.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

53 Note 1 – Summary of Significant Accounting Policies (Continued)

L. Lease Receivable (Continued)

At the commencement of a lease, the lease receivable is meas ured at the present value of payments expected to be received during the lease term. The City established a thr eshold of $5,000 for lease receivables. Subsequently, the lease receivable is reduced by the principal portion of lease payments received.

The deferred inflows of resources are initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date. Subsequently, the deferred inflows of resources are recognized as revenue over the life of the lease term in a systematic and rational method.

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

 The City uses incremental borrowing rate (IBR) provided by the financial institution at July 1, 2021 for existing leases or the current rate at the time a new lease is executed.  The lease term includes the noncancelab le period of the lease plus any option periods that are likely to be exercised.
 Lease receipts included in the measurement of the lease receivable is composed of fixed payments from the lessee.

The City monitors changes in circumstances that would require a remeasurement of its lease and will remeasure the lease receivable and deferred inflows of resources if certa in changes occur that are expected to significantly affect the amount of the lease receivable.

M. Capital Assets

Capital assets are valued at historical cost or estimated historical cost if the actual historical cost was not available.

Donated capital assets are valued at their estimated fair market value on the da te donated. City policy has set the capitalization threshold for reporting capital assets at $5, 000 for equipment and works of art; $10,000 for land, buildings, improvements and intangible assets; $50,000 for infrastructure, all of which must have an estimated useful life more than one year. Depreciation is recorded on a straight-line basis over estimated useful lives of the assets as follows:

Infrastructure 30-100 years
Buildings and Improvements 20-50 years
Machinery and equipment 3-30 years

Major outlays for capital assets are capitalized as projects progress and once constructed begin depreciation. Repairs and maintenance costs are expensed. Interest accrued during capital assets construction, if any, is capitalized for the business-type funds as part of the asset cost.

Capital assets are valued at historical cost or estimated historical cost if the actual historical cost was not available.

Donated capital assets are valued at their estimated fair market value on the date donated.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

54 Note 1 – Summary of Significant Accounting Policies (Continued)

M. Capital Assets (Continued)

The City established a threshold to recognize a right‐to‐use lease asset (lease asset) in the government‐wide financial statements and proprietary fund financial statements for a leased asset over $5,000. Lease assets are recorded at the amount of the initial measurement of the lease liabilities a nd adjusted by any lease payments made to the lessor at or before the commencement of the lease term, less any lease incentives received from the lessor at or before the commencement of the lease term along with any initial direct costs that are ancillary charges necessary to place the lease assets into service. Lease assets are amortized using the straight-line method over the shorter of the lease term or the useful life of the underlying asset, unless the lease contains a purchase option that the City has determined is reasonably certain of being exercised. In this case, the lease asset is amortized over the useful life of the underlying asset.

N. Capital Contributions

Capital contributions are comprised of cash and assets donated from developers. Connection fees are reported as capital contributions in the Water Utility and Wastewater Utility enterprise funds.

O. Accrued Payroll and Related Liabilities

The City is on a semi-monthly payroll period, and employees are paid seven calendar days after the end of the payroll periods ending on the 15th and the end of the month or the last working day before that date. As of June 30, 2022, the payroll accrual is recorded in the respective funds when the related liability is incurred.

P. Accrued Compensated Absences

By negotiated labor agreements, employees accumulate earned, but unused vacation, other compensated leave, and sick leave pay benefits. Employees were allowed to apply 100% of accrued sick leave hours for additional California Public Employees’ Retirement System (“CalPERS”) service credit upon retirement depending upon bargaining unit and date of hire. As of July 1, 2013, employees separating from service will receive their full vacation payout.

After subtracting the sick leave balance equivalent of one full year of service credit (2080 hours), which may be applied to CalPERS service credit, any sick leave balance remaining upon separation shall be paid at a specific percentage of the cash value to employees who have remain ed in City service until the da tes specified in the labor agreements.

Government-Wide Financial Statements

For governmental and business-type activities, compensated absences are recorded as expenses when earned.

Fund Financial Statements

For governmental funds, compensated absences are recorded as expenditures in the year paid. The General Fund is typically used to liquidate compensated absences. In proprietary funds, comp ensated absences are expensed to the various funds in the period they are earned, and such f und’s share of the unpaid liability is recorded as a long-term liability of the fund.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

55 Note 1 – Summary of Significant Accounting Policies (Continued)

Q. Long-Term Debt

In the government-wide and proprietary fund financial st atements, long-term debt a nd other long-term financial obligations are reported as liabilities.

Bond issuance premiums and discounts, as well as prepaid insurance, are amortized over the life of the bonds using the straight-line method. Bonds payable are reported net of the applicable premium or discount except for insurance prepaid bond insurance premiums.

In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, in the year of issuance. The face amount of the debt issued is reported as other financing sources.

Premiums received on debt issuances are reported as othe r financing sources while discounts on debt issuances are reported as other financing uses. The differences between the government-wide and fund financial statements are shown in the Reconciliation of the Gove rnmental Funds Balance Sheet to th e Government-Wide Statement of Net Position.

R. Lease Liabilities

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

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

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

 The City uses incremental borrowing rate provided by the financial institution at July 1, 2021 for existing leases or the current rate at the time a new lease is executed.  The lease term includes the noncancellable period of the lease. Lease payments included in the measurement of the lease liability are composed of fixed payments and purchase option price that the City is reasonably certain to exercise.
 Lease payments included in the measurement of the lease payable is composed of fixed payments to the lessor.

S. Pensions

For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expe nse, information about the fiduciary net position of the plans and additions to/deductions from the plans’ fiduciary net position have been determined on the same basis as they are reported by the plans. For this purpose, benefit payments (includi ng refunds of employee contributions) are recognized when due and payable in accordance with benefit terms. Investments are reported at fair value.

General Fund and special revenue are typically used to liquidate pension liabilities for governmental funds.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

56 Note 1 – Summary of Significant Accounting Policies (Continued)

S. Pensions (Continued)

The following time frames are used for pension reporting:

Gains and losses related to changes in total pension lia bility and fiduciary net positi on 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 amorti zation 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-lin e 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.

T. Net Position

In governmental-wide and proprietary fund financial statements, Net Position is classified as follows:

Net Investment in Capital Assets – This component of net position of capital assets, net of accumulated depreciation and amortization, reduced by the outstanding balances of a ny borrowings used for the acquisition, construction, or improvement of those assets, and excludes unspent debt proceeds. Deferred outflows of resources and deferred inflows of resources that are attributable to the acquisition, construction, or improvement of those assets or related debt also should be included in this component of net position.

Restricted – This component of net position c onsists of restricted assets reduced by liabilities and deferred inflows of resources related to those assets.

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

When expenses are incurred for purposes fo r which both restricted and unrestricted net position are available, the City’s policy is to first spend the restricted net position.

CALPERS
Valuation Date June 30, 2020
Measurement Date June 30, 2021
Measurement Period July 1, 2020 to June 30, 2021
PARS
Valuation Date June 30, 2020
Measurement Date June 30, 2022
Measurement Period July 1, 2021 to June 30, 2022

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

57 Note 1 – Summary of Significant Accounting Policies (Continued)

U. Fund Balances

In the governmental fund financial statements, fund balances are classified as follows:

Nonspendable – Amounts that cannot be spent because they are (1 ) not in spendable form, such as prepaid items, inventories and long-term receivables for which the payment of proceeds are not restricted or committed with respect to the nature of the specific expenditures of that fund or (2) legally or contractually required to be maintained intact, such as principal of an endowment or revolving loan funds.

Restricted – Amounts that are restricted by external parties such as creditors or imposed by grants, laws or regulations of other governments or imposed by law through constitutional provisions or enabling legislation. The City has legislative restrictions on amounts collected and reported in the City’s various governmental funds. As a result, these restrictions have been classified as restricted for community development, debt service reserve, general government, housing projects/loans, libraries and arts, parks and recreation, public safety, public services, redevelopment projects, solid waste/recycling and streets, transit and traffic.

Committed – This amount indicates the portion of fund balances which can only be used for specific purposes under formal resolution or ordinance of the City Council. Commitments may be changed or lifted only by the City taking the same formal action that imposed the constraint originally.

Assigned – Amounts that have been allocated by action of an official authorized by the Stockton City Council in which the City’s intent is to use the funds for a specific purpose. The City considers this level of authority to be the City Manager.

Unassigned – Amounts that constitute the residual balances that have no restrictions placed upon them. If restrictions exceed available resources at the end of the year, the deficit amounts are reported and classified as unassigned.

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

When expenditures are incurred for purposes where only unrestricted fund balances are available, the City uses the unrestricted resources in the following order: committed, assigned, and unassigned depending on the nature of the expenditure.

V. Property Taxes

Property taxes are levied on October 1 and are payable by property owners in two installments: November 1 and February 1 of each year. Property taxes become delinquent on December 10 and April 10, for the first and second installments, respectively. The lien date is January 1. The County of San Joaquin, California (“County”) bills and collects property taxes and remits them to the City according to a payment schedule established by the County. The County generally operates under the Teeter Plan, whereby th e County pays the City 100% of the taxes levied. The County assumes responsibility for collecting any delinquent amounts and upon co llection retains the penalty and interest portion of those amounts. Therefore, no allowance for doubtful accounts is considered necessary.

Property Valuations are established by the Assessor of the County of San Joaquin for the secured and unsecured property tax rolls; the utility property tax rolls are valued by the State Board of Equalization. Under the provisions of Article XIIIA of the State Constitution (Proposition 13 adopted by the voters on June 6, 1978) properties are assessed at 100% of full value. From this base of assess ment, subsequent annual increases in valuation are limited to a maximum of 2%. However, increases to full value ar e allowed for property improve ments or upon change in ownership. Personal prope1ty is excluded from these limitations, and is subject to annual reappraisal.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

58 Note 1 – Summary of Significant Accounting Policies (Continued)

V. Property Taxes (Continued)

Property tax revenue is recognized in the fiscal year for which the taxes have been levied, provided the taxes are received within 90 days after the end of the fiscal year. Property taxes received after this date are not considered available as a resource that can be used to finance the current year operations of the City and, therefore, are not recorded as revenue until collected.

W. Use of Estimates

The preparation of basic financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures. Accordingly, actual results could differ from these estimates and assumptions.

X. Implementation of New GASB Pronouncements

During the year ended June 30, 2022, the City implemented the following new GASB Pronouncements.

In June 2017, GASB issued Statement No. 87, Leases (GASB Statement No. 87), to better meet the information needs of financial statement users by improving accounting and financial reporting for leases by governments. This Statement increases the 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 deferred inflow of resour ces, thereby enhancing the relevance and consistency of inform ation about governments’ leasing activities. The effective date of GASB Statement No. 87 (as amended by GASB Statement No. 95) is for fiscal years beginning after June 15, 2021.

Implementation of this Statement resulted in restatement of beginning balan ce of lease assets (Note 7) and lease liabilities (Note 8) at July 1, 2021.

GASB Statement No. 89 – In June 2018, GASB issued Statement No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period . This Statement establishes accounti ng requirements for interest cost incurred before the end of a construction period. Such interest cost includes all interest that previously was accounted for in accordance with the requirements of paragraphs 5–22 of Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre–November 30, 1989 FASB and AICPA Pronouncements, which are superseded by this Statement. This Stat ement requires that interest cost incu rred before the end of a construction period be recognized as an expense in the period in which the cost is incurred for financial statements prepared using the economic resources measurement focus. As a result, interest cost incurred before the end of a construction period will not be included in the historical cost of a capital asset reported in a business–type activity or enterprise fund.

Implementation of this Statement did not have a significan t effect on the City’s financial statements for the fiscal year ended June 30, 2022.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

59 Note 1 – Summary of Significant Accounting Policies (Continued)

X. Implementation of New GASB Pronouncements (Continued)

GASB Statement No. 92 – In January 2020, GASB issued Statement No. 92, Omnibus 2020. The primary objectives of this Statement are to enhance comparability in accounting and financial reporting and to improve consistency of authoritative literature by addressing practice issues that have been identified during implementation and application of certain GASB Statements. Implementation of this Statement did not have a significant effect on the City’s financial statements for the fiscal year ended June 30, 2022.

GASB Statement No. 93 – In March 2020, GASB issued Statement No. 93, Replacement of Interbank Offered Rates.

Some governments have entered into ag reements in which variable payments made or received depend on an interbank offered rate (IBOR)—most notably, the London Interbank Offered Rate (LIBOR). As a result of global reference rate reform, LIBOR is expect ed to cease to exist in its current form at the end of 2021, prompting governments to amend or replace financial instruments fo r the purpose of replacing LIBOR with other reference rates, by either changing the reference rate or adding or changing fallback provisions re lated to the reference rate.

The objective of this Statement is to address those and other accounting and financial reporting implications that result from the replacement of an IBOR. Implementation of this Statement did not have a significant effect on the City’s financial statements for the fiscal year ended June 30, 2022.

GASB Statement No. 97 – In June 2020, GASB issued Statement No. 97, Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Reve nue Code Section 457 Deferred Compensation Plans – An Amendment of GASB Statements No. 14 and No. 84, and a Supersession of GASB Statement No. 32. The primary objectives of this Statement are to (1) increase consistency and comparability related to the reporting of fiduciary component units in circumstances in which a potential component unit does not have a governing board and the primary government performs the duties that a governing board typically would perform; (2) mitigate costs associated with the reporting of certain defined cont ribution pension plans, defined contribution other postemployment benefit (OPEB) plans, and employee benefit plans other than pension plans or OPEB plans (other employee benefit plans) as fiduciary component units in fi duciary fund financial statements; and (3) enhance the relevance, consistency, and comparability of the accounting and financial reporting for Internal Revenue Code (IRC) Section 457 deferred compensation plans (Section 457 plans) that meet the definition of a pension plan and for benefits provided through those plans. Implementation of this Statement did not have a significant effect on the City’s financial statements for the fiscal year ended June 30, 2022.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

60 Note 2 – Cash, Cash Equivalents and Investments

The following is a summary of cash, cash equivalents, and investme nts, including restricted cash and investments at June 30, 2022:

A. Cash Deposits

The carrying amount of the City’s pooled cash deposits was $196,876,122 at June 30, 2022. Bank balances before reconciling items were $204,997,056 at that date, the tota l amount of which was insured or collateralized with securities held by the pledging financial institutions in the City’s name as discussed below.

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

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

The City follows the practice of pooling cash and investments of all funds, except for funds required to be held by fiscal agents under the provisions of bond indentures or by donor direction. Interest income from cash and investments with fiscal agents is credited directly to the related fund.

Deposits:

Cash on Hand 721,079 $
Demand Deposits 196,876,122
Total Deposits 197,597,201
Investments 789,869,636
Total Cash and Investments 987,466,837$
Presented in the gov ernment-wide statement of net position:

Cash and Investments 867,679,777 $
Restricted Cash and Investments 78,010,459
Presented in the statement of fiduciary net position:

Cash and Investments 35,303,998
Cash and investments with fiscal agents 6,472,603
Total Cash and Investments 987,466,837$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

61 Note 2 – Cash, Cash Equivalents and Investments (Continued)

B. Authorized Investments

Investments Authorized by the California Government Code and City’s Investment Policy

The table below identifies the investment types that are authorized for the City by the California Government Code (“CGC”) or the City’s investment policy, where more restrictive. The table also identifies certain provisions of the California Government Code or the City’s investment policy, which are more restrictive to address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by the bond trustee that are governed by the provisions of debt agreements of the City.

Maximum Minimum
Maximum in Credit
Authorized Investment Type Maturity Portfolio Quality
Securities of the U.S. Government or its agencies:

U.S. Treasury Bonds, Notes and Bills 10 Years** No Limit N/A State of California Obligations 5 Years No Limit N/A
49 other States Obligations 5 Years No Limit N/A
California Non Stockton Local Agency Obligations 5 Years No Limit N/A U.S. Agency and U.S. Government sponsored
Enterprise Securities 10 Years** No Limit N/A
City of Stockton Obligations 5 Years* None None
Negotiable Certificates of Deposit 5 Years* 30% AA
Time Certificates of Deposit 5 Years 30% N/A
Bankers' Acceptances 180 Days 40% N/A
Commercial Paper 270 Days 25% A1, P1, F-1
Medium-Term Corporate Notes 5 Years 30% A
California Local Agency Investment Fund
- Investments made in County or other types of investment pools require due diligence
Upon
Demand
$75,000,000
per account N/A
California Asset Management Program Upon Demand No Limit*** N/A**** Repurchase Agreements 1 year None N/A
Reverse Repurchase Agreements 92 days 20% N/A
- If the City invests in Repurchase Agreements, a Maste r Repurchase Agreement is required
Demand Accounts - Insured/Collateralized Medium Term Notes N/A No Limit N/A Mutual Funds
SEC registered Money Market Funds limited to a percentage of the City's surplus as narrowly defined in the California Government Code Section 53601 et seq. N/A 20% AAA
* Limited to 5 years, except permits investment in variable rate demand obligations (VRDO) that are City obligations up to 10 years maturity, as allowed under IRS and SEC rulings.

VRDO investments are limited to 15% of the portfolio.
** Securities with term to maturity g reater than 5 years shall not ex ceed 15% of the total portfolio value. *** Investments by any single agency may make up no more than 10% of pool holdings ***
*Pool composition restricted by CGC 53601.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

62 Note 2 – Cash, Cash Equivalents and Investments (Continued)

B. Authorized Investments (Continued)

Investments Authorized by Debt Agreements

Investments of debt proceeds held by the City’s bond tr ustee are governed by provisions of the debt agreement, rather than the general provisions of the California Government Code or the City’s investment policy. The table below identifies certain provisions of these debt agreemen ts that address interest rate risk, credit risk, and concentration of credit risk.

Authorized Inv estment Type
Maximum
Maturity
Minimum Credit
Quality
Maximum
in Portfolio
Maximum
Investment
In One
Issuer
Repurchase Agreements 30 days Top Four Rating
Categories
No Limit No Limit
U.S. Treasury Bonds, Notes and Bills No Limit N/A No Limit No Limit U.S. Agency and U.S. Government
Sponsored No Limit No Limit No Limit No Limit
Enterprise Securities
State Obligations No Limit Not lower than
their bond rating
No Limit No Limit
Commercial Paper 270 days A-1+ No Limit No Limit
Negotiable Certificates of Deposit No Limit N/A No Limit No Limit Time Certificates of Deposit No Limit N/A No Limit No Limit Corporate Notes and Bonds No Limit Not lower than
their bond rating
No Limit No Limit
Guaranteed Investment Contracts No Limit Not lower than their bond rating
No Limit No Limit
Shares of Beneficial Interest No Limit Top Rating
Category
No Limit No Limit
Money Market Mutual Funds No Limit AAm 20% No Limit
Bankers' Acceptances 365 days A-1+ 30% 30%
Municipal Bonds No Limit AAA No Limit No Limit
California Local Agency Investment Fund
(LAIF)
Upon
Demand
N/A $75,000,000 $75,000,000
California Asset Management Program Upon
Demand
N/A No Limit* No Limit*
Investment Agreements No Limit AA- No Limit No Limit
*Pool is constrained by CGC 53601 as to % that the pool must abide by

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

63 Note 2 – Cash, Cash Equivalents and Investments (Continued)

C. Investments in Local Agency Investment Fund

The City is a participant in LAIF which is regulated by California Government C ode Section 16429 under the oversight of the Treasurer of the State of California. The City’s investments in LAIF included a portion of pool funds invested in structured notes and asset-backed securities:

Structured Notes are 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, the bulk of which are mortgage-backed securities, entitle their purchasers to receive a share of the cash flows from a pool of assets such as principal and interest repayments from mortgages (such as Collateralized mortgage obligations) or credit card receivables.

As of June 30, 2022, the City had $74,034,406 invested in LAIF, which had invested 1.88 % of the Pool investment funds in medium-term and short-term structured notes as well as asset-backed securities. The face value of the City’s position in the pool is the same as the value of the pool shares.

D. Investments in California Asset Management Program (“CAMP”)

The City is a participant in CAMP which is a Californi a Joint Powers Authority ("JPA") established in 1989 to provide California public agencies with professional investment services. The CAMP Pool is a permitted investment for all local agencies under California Government Code Section 53601(p). Structured Notes and Asset Backed Securities are not permitted under CAMP’s current investment policy.

As of June 30, 2022, the City had $82,050 invested in CAMP, which had invested 18.34% of the Pool investment funds in medium-term and short-term structured notes or asset backed securities. The face value of the City’s position in the pool is the same as the value of the pool shares.

E. Fair Value of Investments

At June 30, 2022, investments are reported at fair value. The following table presents the fair value measurements of investments on a recurring basis and the levels with GASB 72 fair value hierarchy in which the fair value measurements fall at June 30, 2022. Deposits and withdrawals related to the investments in LAIF, CAMP, and money market funds are valued on amortized cost, which approximates fair value. Accordingly, under the fair value hierarchy these investments are uncategorized.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

64 Note 2 – Cash, Cash Equivalents and Investments (Continued)

E. Fair Value of Investments (Continued)

(1) Pricing based on Institutional Bond Quotes - evaluations based on various market and industry inputs. (2) Pricing based on Intercontinental Exchange Extel Financial Ltd - evaluations based on various market factors. (3) Cash and cash equivalent valued at an amortized cost which approximates fair value.

F. Risk Disclosures

Interest Rate Risk

As a means of limiting its exposure to fair value losses arising from rising interest rates, the City's investment policy provides that final maturities of securities cannot exceed five years. The exceptions to this policy are that U.S.

Treasury or U.S. Agency securities may be invested in greater than five year s and investment in variable rate obligations of the City is permissible when allowed by the IRS and SEC. Investments maturing beyond a five-year horizon should not exceed fifteen percent (15%) of the tota l portfolio value at any given time. The maturity of investments is evaluated before purchase depending on liquidity needs.

Investments subject to fair value measurement categorizations: June 30, 2022 Level 1 Level 2 Uncategorized (3)
U. S. Agencies (1) 144,341,056$ - $ 144,341,056$ - $ U. S. Treasuries 249,515,008 249,515,008 - - Medium term notes(1) 101,286,818 - 101,286,818 - Supranationals(2) 11,523,992 - 11,523,992 - Municipal Bonds(1) 16,032,962 - 16,032,962 Federal Agency CM Os (1) 4,012,331 - 4,012,331 - Negotiable CD(1) 70,426,270 - 70,426,270 - Cmmercial Paper(1) 36,467,953 36,467,953 - Asset backed securities(1) 13,682,005 - 13,682,005 - Cash - PARS 115 Trust 22,258 - - 22,258 Equity Mutual Fund- PARS 115 Trust 19,062,529 - 19,062,529 - Fixed Income Mutual Fund- PARS 115 Trust(1) 44,130,563 - 44,130,563 - Idle Funds in Reserve Portfolio 1,626,761 - - 1,626,761 Local Agency Investment Fund 74,034,406 - - 74,034,406 California Asset Management Program (CAMP) 82,050 - - 82,050 Money Market Funds (attributable to 115 Trust) 3,622,674 - - 3,622,674 Total 789,869,636$ 249,515,008 $ 460,966,479 $ 79,388,149 $ Measurement Input

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

65 Note 2 – Cash, Cash Equivalents and Investments (Continued)

F. Risk Disclosures (Continued)

Interest Rate Risk (Continued)

Information about the sensitivity of the fair values of the City’s investments (including investments held by fiscal agents) to market interest rate fluctuations is provided by the following table that shows the distribution of the City’s investments by maturity or earliest call date.

Credit Risk

Credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. It is measured by the assignment of a rating by a nationally recognized statistical rating organization.

Investment Maturities
Inv estment Type Fair Value 1 year or less 1-3 years 3-5 years 5 years
or more
U.S. Agencies 144,341,056 $ 21,253,026$ 85,866,445$ 37,221,585$ -$ U.S. Treasuries 249,515,008 - 115,331,522 126,483,199 7,700,287 Medium Term (Corporate) Notes 101,286,818 3,512,831 87,052,556 10,721,431 - Supranationals 11,523,992 - 11,523,992 - - Municipal Bonds 16,032,962 - 9,722,639 6,310,323 - Federal Agency CMOs 4,012,331 2,005,383 2,006,948 - - Local Agency Investment Fund 74,034,406 74,034,406 - - - Capital Asset Management Program 82,050 82,050 - - - Money Market Funds (attributable to 115 Trust) 3,622,674 3,622,674 - - - Negotiable CD 70,426,270 70,426,270 - - - Asset Backed Securities 13,682,005 215,915 5,515,254 7,950,836 - Commercial paper 36,467,953 36,467,953 - - - Cash - PARS 115 Trust 22,258 22,258 - - - Equity Mutual Fund- PARS 115 Trust 19,062,529 19,062,529 - - - Fixed Income Mutual Fund- PARS 115 Trust 44,130,563 44,130,563 - - - Idle Funds in Reserve Portfolio 1,626,761 1,626,761 - - - Tot
al 789,869,636$ 276,462,619$ 317,019,356$ 188,687,374$ 7,700,287$ Allocation by percentage 100% 35% 40% 24% 1%

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

66 Note 2 – Cash, Cash Equivalents and Investments (Continued)

F. Risk Disclosures (Continued)

Credit Risk (Continued)

Presented below is the actual rating as of June 30, 2022, for each investment type as provided by Standard and Poor’s (“S&P”) investment rating system:

The City's portfolio manager utilized ratings of S&P in compiling the previous table. In August 2011, S&P took an extraordinary stance of downgr ading the debt of the United States and numerous agencies whose debt it stands behind. Moody's and Fitch only took moves to lower th e outlook on U.S. debt while still maintaining the AAA ratings on these entities. On March 8, 2022, S&P affirmed the AA+ rating with a stable outlook that is still in place today. Moody's affirmed their AAA rating with stable outlook in June 24, 2022, and Fitch affirmed the AAA rating and brought the outlook to stable on July 8, 2022.

Custodial Credit Risk

For an investment, custodial credit risk refers to the event in which the custodial bank (outside party) in possession of an investment security fails to supply the value of investments or collateral securities to the City upon demand. All securities, except the money market mutual funds and LAIF, are held by a third-party custodian, US Bank. US Bank is a registered member of the Federal Reserve Bank. The securities held by US bank are in the street name with a customer number assigned to the City that identifies ownership.

Concentration Credit Risk

The City’s investment policy regarding the amount that can be invested in any one issuer is stipulated by the California Government Code. Concentrations of 5.0% or more in investments in any one issuer, held by individual funds in the securities of issuers other than U.S. Treasury securities, mutual funds, and external investment pools are required to be disclosed.

AAA/AAAm AA / AA+ / AA- A / A+/ A- A-1+ BBB+ Total
Held by the City and its Component Units:

U. S. Agencies:

Non-callable - $ 148,353,387$ - $ - $ - $ 148,353,387$ Medium term notes:

Non-callable - 8,016,097 33,773,695 - - 41,789,792 Callable 5,317,258 15,259,516 32,790,026 - 6,130,226 59,497,026 Asset Backed Securities 13,682,005 - - - - 13,682,005 Commercial Paper - - - 36,467,953 - 36,467,953 Negariable CDs - - - 70,426,270 - 70,426,270 Supranationals 11,523,992 - - - - 11,523,992 Municipal securities 2,785,914 13,247,048 - - - 16,032,962 Total 33,309,169 $ 184,876,048 $ 66,563,721 $ 106,894,223 $ 6,130,226 $ 397,773,387 Not rated or ex em pt from rating disclosure:

Local Agency Investm ent Fund 74,034,406
California Asset Managem ent Program 82,050
U. S. Treasuries 249,515,008
Section 115 Trust Mutual Funds (not rated) 66,815,766
Cash Held in 115 Trust 22,258
Idle Funds in Reserve Portfolio 1,626,761
Total Investments 789,869,636$
Investment Type

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

67 Note 2 – Cash, Cash Equivalents and Investments (Continued)

F. Risk Disclosures (Continued)

Concentration Credit Risk (Continued)

At June 30, 2022, the City’s Pooled investments that represent a concentration in the securities of any individual issuers, other than U. S. Treasury securities or mutual funds, are set forth below:

G. Restricted Cash and Investments

Certain proceeds of revenue bonds and other long-term liabilities are classified as restricted cash and investments on the Statement of Net Position as their use is limited by applicable indentures or covenants. Covenants provide that these funds, in the absence of specific statutory provisions governing the issuance of bonds, certificates, or leases, may be invested by the ordinances, resolutions or indentures specifying the types of investments its trustees or fiscal agents may require. The ordinances, resolutions, and indentures are more restrictive than the City’s investment policy. Restricted cash and investments of the City are primarily for the construction or acquisition of facilities, and reserves for payment of debt service as required by the bond indentures.

The City has a reserve policy governing the establishment of Rate Stabilization Fund for its Water, Wastewater, and Stormwater Funds. These reserves are to ease future revenue fluctuations, where revenues are interrupted or otherwise insufficient to offset the operating expenditures and to minimize the impact of rate increases. The City has established a Rate Stabilization Fund in the Water Fund in connection with the issuance of its 2010 Variable Rate Demand Water Revenue Bonds and the Wastewater Fund in connection with the 2014 Wastewater Refunding Bonds. (The City use money on deposit in the Rate Stabilization Fund for any lawf ul purpose.) All interest or other earnings in the Rate Stabilization Fund may be withdrawn and accounted for as revenues or used for any lawful purpose. The balance in the Wastewater Rate Stabilization Accounts at June 30, 2022, was $1,771,253.

At June 30, 2022, the restricted cash and investments with fiscal agents are as follows:

Issuer Investment Type
Reported
Amount Total Hold ings
Held by City and its Component Units: $ 789,869,636 Federal National Mortgage Association Federal Agency Securities 99,294,973$ 12.57% Governmental activities 71,545,010$
Business-type activities:

Water Utility 25
Wastewater Utility 1,771,253
Parking Authority 4,694,171
Subtotal 6,465,449
Fiduciary Funds 6,472,603$
Total restricted cash and investments 84,483,062$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

68 Note 3 – Interfund Transactions

A. Loans To/From Other Funds

“Loans to” and “loans from” balances represent loan activity between funds. These balances are expected to be paid back per a City council approved repayment schedule. The of $9,325,994 of interfund loan balances, broken down by short and long-term net of interest, as of June 30, 2022 is shown below.

The most significant inter-fund transactions were as follows:

 The $7,011,332 interfund loan balance from the Worker s’ Compensation Insurance Internal Service Fund to the Parking Authority Enterprise Fund was used to pay-off the existing 2006 Lease Revenue Refunding Bonds Series A, saving the City 2% in annual interest.

 The $1,819,062 interfund loan balance from the Work ers’ Compensation Insurance Fund to the Internal Services Vehicle Fleet Equipment Fund was used to pay off three of four remaining Fire Truck Leases, saving the City 2% in annual interest.

 The $495,600 interfund loan from the Technology Intern al Service Fund to the General Fund -Emergency Communications was used for equipment, software, and facility improvements to expand the Fire Dispatch Center and is expected to be repaid in FY2022-23.

Fund Making Loan Fund Receiving Loan Short-Term Long-term Total Internal Service Funds -Workers' Compensation Parking Authority 643,105$ 6,368,227$ 7,011,332$ Internal Service Funds -Workers' Compensation Internal Service Funds -Vehicle Fleet Equipment 454,217 1,364,845 1,819,062 Internal Service Funds -Computer and Radio Equipment General Fund - Emergency Communications 495,600 - 495,600 Total 9,325,994$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

69 Note 3 – Interfund Transactions (Continued)

B. Transfers

Interfund transfers report the nonreciprocal contributions of resources from one fund to another that include program support, debt service and settlement, and other one-time transf ers. The following is a summary of transfers for the year ended June 30, 2022:

Transfers In Transfers Out Net Transfers
Governmental Activities:

General Fund Program Support $ - (1,297,700)$ (1,297,700) $ General Fund Capital Improvement - (5,120,994) (5,120,994) General Fund Debt Service - (5,816,875) (5,816,875) SSA Debt Service/ Settlement - (398,809) (398,809) Special Grants Program Support - (1,500,000) (1,500,000) Non-Major Government Funds Program Support 800,000 (12,747,667) (11,947,667) Non-Major Government Funds Debt Service 6,813,898 - 6,813,898 Capital Improvement Program Support 20,003,898 (598,214) 19,405,684 Internal Service Funds Program Support 300,554 300,554 Total governmental activities 27,918,350 (27,480,259) 438,091 Business-type Activities:

Water Utility Program Support - (19,650) (19,650) Wastewater Utility Program Support - (622,808) (622,808) Stormwater Utility Program Support - (293,333) (293,333) Ma ri na Program Support 262,000 - 262,000 Golf Courses Program Support 235,700 - 235,700 Total business-type activities 497,700 (935,791) (438,091) Total Government-Wide Statements 28,416,050$ (28,416,050)$ -$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

70 Note 4 - Lease Receivable

Lease receivables consist of agreements with others for the right–to–use of the underlying assets for land and buildings owned by the City at various locations. The remaining terms of the agreements range from 26 to 600 months. The incremental borrowing rates used were between 0.2450% to 1.800% depending on the length of the lease term. For the year ended June 30, 2022, the City recognized $71,038, $26,587, and $7,790 in lease revenue and $22,908, $273, and $337 in interest revenue for the Governmental Activitie s, the Business-Type Activities, and the Successor Agency, respectively. The outstanding receivables are in the amounts of $1,473,569, $59,411, an d $41,321 for the Governmental Activities, the Business-Type Activities, and the Successor Agency, respectively.

The future required payments for these leases, including interest, are as follows:

Year Ending
June 30, Principal Interest Total Principal Interest Total Principal Interest Total 2023 47,443$ 24,436 $ 71,879$ 26,337 $ 195$ 26,532 $ 7,612$ 308 $ 7,920$ 2024 40,230 23,822 64,052 26,446 86 26,532 7,674 246 7,920 2025 41,130 23,182 64,312 6,628 5 6,633 7,737 183 7,920 2026 44,165 22,492 66,657 - - - 7,800 120 7,920 2027 47,343 21,751 69,094 - - - 7,864 56 7,920 2028 - 2032 270,827 96,251 367,078 - - - 2,634 4 2,638 2033 - 2037 335,426 71,823 407,249 - - - - - - 2038 - 2042 128,415 50,293 178,708 - - - - - - 2043 - 2047 71,249 43,617 114,866 - - - - - - 2048 - 2052 77,961 36,904 114,865 - - - - - - 2053 - 20
57 85,305 29,560 114,865 - - - - - - 2058 - 2062 93,342 21,523 114,865 - - - - - - 2063 - 2067 102,134 12,729 114,863 - - - - - - 2068 - 2071 88,599 3,298 91,897 - - - - - - 1,473,569$ 481,681 $ 1,955,250$ 59,411 $ 286$ 59,697 $ 41,321$ 917 $ 42,238$ Governmental Activities Business-Type Activities Fidicuary Funds

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

71 Note 5 – Successor Agency – Loans from City, Net

With the dissolution of the Redevelopment Agency effective January 31, 2012, the following loans are outstanding as of June 30, 2022, most of which are offset by an Allowance for Uncollectible Loans. The Successor Agency received its Finding of Completion from the State Department of Finance on October 30, 2014. On November 4, 2015, the Oversight Board adopted a resolution finding 51 Redevelopment loan s from the City were made for legitimate redevelopment purposes. Dissolution law required that the accrued interest on outstanding loans be recalculated quarterly at a simple interest of 3% from the date the loan s were originally authorized by the fo rmer Redevelopment Agency. Also, the Department of Finance required approved resolutions and signed loan agreemen ts for the loans to be approved for repayment. However, City staff was unable to locate signed loan agreements or documents and approved resolutions for all of the 51 loans. Adjustments for the write off of all loans were disallowed by the Department of Finance in the 2016- 2017 fiscal year.

In addition, the interest on the loans is limited to the Lo cal Agency Investment Fund interest rate calculated from the inception date of each loan. The total outstanding loan ba lance (including accrued interest) as of June 30, 2022 is $5,613,413 and has been offset by an allowance for uncollectib le loan and interest in the amount of $4,506,833, except the loan amount from Low – Moderate Income Housing Loans.

 The $1,106,580 outstanding loan balance from the Low - Moderate Income Housing fund, a City Special Revenue Fund, to the former Redevelopment Agency Capital Projects Funds was to fund the Waterfront Redevelopment Project Area.

 The $1,250,321 outstanding loan balance from the CDBG Programs, a Special Revenue Fund, to the former Redevelopment Agency Capital Projects Fund was for th e project area expenditures. The outstanding principal balance is subject to a 3% simple annual interest rate. As of June 30, 2022, outstanding accrued interest balance is $2,244,166.

 The $1,012,346 outstanding loan balance from the Capita l Improvement Capital Projects Fund to the former Redevelopment Agency Capital Projects Fund represents loans for various project areas.

Fund Providing Loan Fund Receiving Loan
Outstanding
Balance
Allowance for
Uncollectible
Loans Ne t Bal ance
Low - Moderate Income Housing RDA Loans Private-Purpose Trust Fund - Successor Agency of the Redevelopment Agency 1,106,580$ -$ 1,106,580$ Non-Major Governmental - CDBG Fund Private-Purpose Trust Fund - Successor Agency of the Redevelopment Agency 1,250,321 (1,250,321) - Capital Improvement Projects Fund Private-Purpose Trust Fund - Successor Agency of the Redevelopment Agency 1,012,346 (1,012,346) - Interest on Redevelopment Agency Loans 2,244,166 (2,244,166) - Total 5,613,413$ (4,506,833)$ 1,106,580$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

72 Note 6 – Loans to Property Owners

Loans provided to property owners are managed by the City’s Economic Development Department (EDD). Loans receivables under the City’s loan programs at June 30, 2022 are as follows:

First Time Home Buyers Program (HOME)
The Home Investment Partnerships Loan Programs are funded through U.S. Departme nt of Housing and Urban Development HOME funds. The programs include deferred gap financing loans for qua lified first-time homebuyers, owner-occupied housing rehabilitation loans to qualified borrowers, and multifamily loans to qualified housing developers. Loan repayments are re-deposited into the program cash accounts and are redistributed as future loans.

Community Development Block Grant Program (CDBG)
The Community Development Block Grants Loan Programs are funded through U.S. Department of Housing and Urban Development CDBG funds. The programs include deferred gap financing loan s for qualified first-time homebuyers, owner occupied emergency repair loans, public facility project loans, and commercial loan programs. Loan repayments are re-deposited into the program cash accounts and are redistributed as future loans.

Neighborhood Stabilization Program
The Neighborhood Stabilization Program loans are funded through U.S. Department of Housing and Urban Development Neighborhood Stabilization program funds. The programs include acquisition, rehabilitation, and resale of foreclosed homes (properties) to qualified home buyers, deferred gap financing loans for qualified home buyers; and acquisition, rehabilitation, and rent of foreclosed properties in targeted areas. Loan repayments are re-deposited into the program cash accounts and are redistributed as future loans.

California Home Loans Program
The California Home Loans Program are funded through the California Department of Housing and Community Development. The programs include deferred gap financing loans to qualif ied first-time home buyers and owner occupied rehabilitation loans. Loan repayments are re-deposited into the program cash accounts and are redistributed as future loans.

Low- and Moderate-Income Housing
The City’s Low- and Moderate-Income Housing Programs are funded through the Low and Moderate-Income Housing City Loans Special Revenue Fund and Strong Neighborhoods Initiative Bond proceeds. The programs include loans for rehabilitation and construction of afford able housing units which are deed restricted for occupancy by low- and moderate-income households for at least fifty-five years. Interest income is recorded as payments when received.

Loan Programs Princip al
Balance
Deferred
Interest Total
First Time Home Buyers Program (HOME) 41,874,071$ 9,006,093$ 50,880,164$ Community Development Block Grant Programs 16,731,191 2,579,737 19,310,929 Neighborhood Stab ilization Firs t Time Home Buyer Program 10,934,138 1,499,722 12,433,860 California Home Loans 2,859,698 360,618 3,220,317 Low & Moderate Income Housing Programs (former Agency) 52,594,307 14,078,765 66,673,072 124,993,405$ 27,524,936$ 152,518,341
Less: Allowance for Doubtful Accounts (3,082,699)
Total 149,435,642$
Governmental Activites

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

73 Note 7 – Capital Assets

A. Government-Wide Financial Statements

At June 30, 2022, the City’s capital assets consisted of the following:

Governmental Business -Type
Activities Activities Total
Capital assets, not being depreciated:

Land 38,196,565$ 15,127,218$ 53,323,783$ Intangible assets - easements 4,354,960 - 4,354,960 Construction in progress 192,071,580 193,438,375 385,509,955 Total capital assets, not being depreciated 234,623,105 208,565,593 443,188,698 Capital assets, being depreciated:

Infrastructure 615,830,270 - 615,830,270 Buildings and improvements 324,338,702 1,051,872,475 1,376,211,177 Machinery and equipment 86,136,929 17,956,150 104,093,079 Total capital assets, being depreciated 1,026,305,901 1,069,828,625 2,096,134,526 Less accumulated depreciation for:

Infrastructure (238,120,517) - (238,120,517) Buildings and improvements (143,856,222) (448,796,561) (592,652,783) Machinery and equipment (57,357,324) (13,090,312) (70,447,636) Total accumulated depreciation (439,334,063) (461,886,873) (901,220,936) Total capital assets, being depreciated, net 586,971,838 607,941,752 1,194,913,590 Lease assets, being amortized:

Intangible asset - right to use 2,017,470 2,866,646 4,884,116 Accumulated amortization (997,527) (215,324) (1,212,851) Total lease assets, being amortized, net 1,019,943 2,651,322 3,671,265 Governmental activities capital assets, net 822,614,886$ 819,158,667$ 1,641,773,553$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

74 Note 7 – Capital Assets (Continued)

B. Governmental Activities

Summary of changes in governmental activities capital assets for the year ended June 30,2022, are as follows:

Governmental activities depreciation and amortization expenses for capital assets for the year ended June 30, 2022, are as follows:

Balance
July 1, 2021 Balance
Governmental activities: (As restated) Additions Deletions Transfers June 30, 2022 Capital assets, not being depreciated:

Land 38,196,565 $ - $ - $ - $ 38,196,565$ Intangible assets - easements 4,354,960 - - - 4,354,960 Construction in progress 162,224,943 45,697,412 (32,431) (15,818,344) 192,071,580 Total capital assets, not being depreciated 204,776,468 45,697,412 (32,431) (15,818,344) 234,623,105 Capital assets, being depreciated:

Infrastructure 614,965,324 864,946 - - 615,830,270 Buildings and improvements 309,180,122 - 15,158,580 324,338,702 Machinery and equipment 80,079,827 5,448,764 (117,405) 725,743 86,136,929 Total capital assets, being depreciated 1,004,225,273 6,313,710 (117,405) 15,884,323 1,026,305,901 Less accumulated depreciation for: -
Infrastructure (226,546,308) (11,574,209) - - (238,120,517) Buildings and improvements (137,721,588) (6,134,634) - - (143,856,222) Machinery and equipment (51,955,384) (5,402,592) 652 - (57,357,324) Total accumulated depreciation (416,223,280) (23,111,435) 652 - (439,334,063) Total capital assets, being depreciated, net 588,001,993 (16,797,725) (116,753) 15,884,323 586,971,838 Lease assets, being amortized:

Intangible asset - right to use 1,854,940 162,530 - - 2,017,470 Accumulated amortization - (997,527) - - (997,527) Total leas
e assets, being amortized, net 1,854,940 (834,997) - - 1,019,943 Governmental activities capital assets, net 794,633,401$ 28,064,690$ (149,184)$ 65,979$ 822,614,886$ Gove rnme ntal Acti vi ti e s:

General Government 1,321,628$
Public Works 13,103,414
Parks & Recreation 3,400,216
Library 202,816
Public Safety 1,277,194
Internal Service Funds 4,803,694
Total 24,108,962 $

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

75 Note 7 – Capital Assets (Continued)

C. Business-Type Activities

Summary of changes in business-type activities capital assets for the year ended June 30, 2022, are as follows:

Business-type activities depreciation and amortization expenses for capital assets for the year ended June 30, 2022, are as follows:

Balance
July 1, 2021 Balance
Business-type activities: (As restated) Additions Deletions Transfers June 30, 2022 Capital assets, not being depreciated:

Land 15,127,218 $ - $ - $ 15,127,218$ Construction in progress 123,266,238 70,172,137 - - 193,438,375 Total capital assets, not being depreciated 138,393,456 70,172,137 - - 208,565,593 Capital assets, being depreciated:

Buildings and improvements 1,049,166,303 6,858,747 (4,152,575) - 1,051,872,475 Machinery and equipment 17,710,847 360,471 (49,189) (65,979) 17,956,150 Total capital assets, being depreciated 1,066,877,150 7,219,218 (4,201,764) (65,979) 1,069,828,625 Less accumulated depreciation for:

Buildings and improvements (426,101,096) (22,695,465) - - (448,796,561) Machinery and equipment (12,137,056) (953,256) - - (13,090,312) Total accumulated depreciation (438,238,152) (23,648,721) - - (461,886,873) Total capital assets, being depreciated, net 628,638,998 (16,429,503) (4,201,764) (65,979) 607,941,752 Lease assets, being amortized:

Intangible asset - right to use 2,857,888 8,758 - - 2,866,646 Accumulated amortization - (215,324) - - (215,324) Total lease assets, being amortized, net 2,857,888 (206,566) - - 2,651,322 Business-type activities capital assets, net 769,890,342$ 53,536,068$ (4,201,764)$ (65,979)$ 819,158,667$ Business-type Activities:

Water Utility 7,861,294 $
Wastewater Utility 12,632,253
Stormwater Utility 1,684,553
Parking Authority 1,053,748
Golf Courses 532,956
Downtown Marina 99,241
Total 23,864,045 $

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

76 Note 7 – Capital Assets (Continued)

D. Fiduciary Fund Activities

Summary of Changes in Fiduciary Fund capital assets for the year ended June 30, 2022, are as follows:

Fiduciary fund depreciation and amortization expenses for capital assets for the year ended June 30, 2022, are as follows:

Balance
July 1, 2021 Balance
Fiduciary fund activities: (As restated) Additions Deletions Transfers June 30, 2022 Capital assets, not being depreciated:

Land 12,602,828 $ - $ (470,849)$ - $ 12,131,979$ Intangible assets - easements 100,000 - - - 100,000 Total capital assets, not being depreciated 12,702,828 (470,849) - 12,231,979 Capital assets, being depreciated:

Infrastructure 10,898,549 - - - 10,898,549 Buildings and improvements 10,929,529 - - 10,929,529 Machinery and equipment 471,546 - - - 471,546 Total capital assets, being depreciated 22,299,624 - - - 22,299,624 Less accumulated depreciation for:

Infrastructure (3,025,267) (249,654) - - (3,274,921) Buildings and improvements (6,463,024) (301,151) - (6,764,175) Machinery and equipment (279,383) (18,677) - - (298,060) Total accumulated depreciation (9,767,674) (569,482) - - (10,337,156) Total capital assets, being depreciated, net 12,531,950 (569,482) - - 11,962,468 Lease assets, being amortized:

Intangible asset - right to use 7,615 - - - 7,615 Accumulated amortization - (4,352) - - (4,352) Total lease assets, being amortized, net 7,615 (4,352) - - 3,263 Fiduciary fund activities capital assets, net 25,242,393$ (573,834)$ (470,849)$ -$ 24,197,710$
Fiduciary Fund Activities:

Successor Agency 573,834$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

77 Note 8 – Long-Term Liabilities

A. Governmental Activities

Summary of changes in governmental activities long-term debt for the year ended June 30, 2022, are as follows:

Balance
July 1, 2021 Payments/ Balance Long-term
(As restated) Additions Reductions June 30, 2022 Short-Term Portion Gove rnme ntal Fund Acti vi ti e s De bt
City Debt
Assured Guaranty Settlement
Assured Settlement Obligation 53,247,671$ - $ (164,013)$ 53,083,658$ 198,847 $ 52,884,811$ Subtotal Settlement Obligation Bonds 53,247,671 - (164,013) 53,083,658 198,847 52,884,811 Other L ong-Term Obligations
CDBG
USD-HUD Housing Note 6,115,000 - (1,750,000) 4,365,000 1,830,000 2,535,000 Subtotal CDBG 6,115,000 - (1,750,000) 4,365,000 1,830,000 2,535,000 Notes Payable
206,486 - (206,486) - - - Subtotal Notes Payable 206,486 - (206,486) - - - Lease Payable
Lease Payable 252,115 162,530 (79,043) 335,602 80,492 255,110 Subtotal Lease Payable 252,115 162,530 (79,043) 335,602 80,492 255,110 Total 59,821,272$ 162,530 $ (2,199,542)$ 57,784,260$ 2,109,339 $ 55,674,921$ Capital / Equipment (Fire)
Tax-Exempt Notes Obligation-2013

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

78 Note 8 – Long-Term Liabilities (Continued)

A. Governmental Activities (Continued)

Pension Obligation Bonds

Taxable Pension Obligation Bonds 2007 Series A and Series B (the “2007 POBs”)

The 2007 POBs were issued on March 26, 2007, to refinan ce the obligation of the City to make payments to the California Public Employees Retirement System for retirement benefits accruing to its employees and retirees. The 2007 POBs for Series A were issued in the amount of $96,985,000. As of June 30, 2022, bonds totaling $77,730,000 were due in installments of principal ranging from $2,850,000 on September 1, 2021, to $8,400,000 on September 1, 2037, with interest ra tes ranging from 5.365% to 5.455% , and a final maturity date of September 1, 2037. The 2007 POBs for Series B were issued in the amount of $28,325,000. At June 30, 2022, bonds totaling $25,955,000 are due in installments of principal ranging from $950,000 on September 1, 2022, to $2,800,000 on September 1, 2037, with interest rates ranging from 5.675% to 5.795%. The Series A and Series B for the 2007 POBs are insured by Assured Guaranty and do not have a reserve fund. The above liabilities are written down and an alternate liability is being recorded which reflects the payments required by the City under a settlement agreement reached with Assured Guaranty. This background on the original liabilities is shown in this footnote due to the bonds still trading in the secondary markets.

As part of a settlement between the City and Assured Guaranty, that became effec tive upon implementation of the approved Plan of Adjustment. The City is obligated, under a revised indenture, to pa y a new series of payments.

That series of payments is made up of Non-Contingent General Fund payments which are made up of three types; Special Fund, Ask, and Supplemental, which have all been determined. Specia l Fund payments range from $1,618,283 on July 1, 2022 to $2,009,482 due on July 1, 2053; Lease Ask Fund payments are due in in installments ranging from $1,334,875 on June 1, 2022 to $2,531,250 du e on June 1, 2052; and Supplemental Payments are due in installments of $250,000 from June 1, 2023, to June 1, 2042, and installments of $350,000 from June 1, 2043, to June 1, 2052. Additionally, there are Contingent General Fund Payments, which are yet to be determined by future revenues of the City’s General Fund. These Contingent Payments extend from June 1, 2022, to June 1, 2053, should General Fund Revenues require them to be made. The payment due June 1, 2023, is currently anticipated to be $4,021,000.

Payments made after the original debt service end date of September 1, 2037, will be retained by Assured Guaranty.

The obligation of the City to pay these settlement amounts when due is an absolute and unconditional obligation of the City imposed by law and is not limited to any special source of funds. Under the Revised Indenture, the City is obligated to deposit non-contingent settlement payments with the Trustee as detailed above and reflected in the table below.

Under the settlement agreement, payments are to be made from all legally available funds and resources available to the City. Under extraordinary events, the City may no tice Assured Guaranty and suspend contingent payments.

Should this occur, unpaid amounts accrue interest at the Prime Rate plus 3% and must be paid no later than ten years after the suspension date. Additionally, any delinquent payments due under the agreement shall also accrue interest at the prime rate plus 3%.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

79 Note 8 – Long-Term Liabilities (Continued)

A. Governmental Activities (Continued)

Pension Obligation Bonds (Continued)

Taxable Pension Obligation Bonds 2007 Series A and Series B (the “2007 POBs”) (Continued)

Debt Service on the original bonds expires in September 2037, and payments under the settlement agreement extend to July 2053. If contingent payment streams drastically exceed expectations, it is possible that scheduled payments could reach a point of paying back funds forwarded and accr ued interest associated with these funds. Should this occur, it is possible that payments could cease before July 2053.

The City settlement with Assured Guar anty was confirmed as part of the City’s Approved Bankruptcy Plan of Adjustment. The plan for the adjustment of the City’s debts provides for material modifications of the City’s obligations on the 2007 POBs and results in a schedule of payments reflected in the following table.

The City pledged all available sources available to the City, up to and including the General Fund as collateral for the Bonds.

Should default in prompt payment or in other obligations under the settlement agreement with Assured Guaranty occur and remain unresolved, under section 5.02 of the Reim bursement Agreement, non-contingent payment streams accelerate and are immediately due and payable. Assured Guaranty is allowed to exercise all rights and remedies legally available (without limitation) to enforce payment of Contingent General Fund Payments due in each year as they become required.

Annual Debt Service Requirements to Maturity

The amounts in the annual debt service requirements to ma turity schedule are the scheduled debt service under the bond indentures and settlement agreements.

Year
June 30, Principal Interest Principal Interest Principal Interest 2023 198,847$ 1,419,436 $ - $ 2,529,750$ - $ 250,000$ 2024 237,557 1,408,468 - 2,529,125 - 250,000 2025 278,378 1,395,364 - 2,527,750 - 250,000 2026 321,242 1,380,009 - 2,530,563 - 250,000 2027 93,227 1,362,289 2,532,500 250,000 2028-2032 1,053,420 6,687,459 - 12,647,251 - 1,250,000 2033-2037 2,006,729 6,298,195 - 12,651,565 - 1,250,000 2038-2042 4,240,216 5,529,620 5,678,669 6,969,832 - 1,250,000 2043-2047 5,890,078 4,157,332 8,257,125 4,393,189 870,029 626,366 2048-2052 7,703,946 2,343,464 10,797,340 1,850,661 1,415,845 256,057 2053-2054 3,709,308 309,656 - - 331,703 - 25,732,947$ 32,291,293$ 24,733,134$ 51,162,186$ 2,617,577$ 5,882,423$ Special Fund Payments Supplemental Payments2007 Lease Ask Payments

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

80 Note 8 – Long-Term Liabilities (Continued)

A. Governmental Activities (Continued)

Other Long-term Obligations

Notes Payable

The City entered into four Section 108 loan guarantee agreements with the U.S. Department of Housing and Urban Development to complete rede velopment projects. All but one has been repaid. The final loan has installment payments due in installments ranging from $615,000 to $1,920,000 and are to be paid through August 1, 2024, with reduced interest rates ranging from 2.57% to 2.668%. Repayment of the loans is made from program income received under the City’s housing loans program.

The City pledged its federal funds under the HUD program available to the City as collateral for the Bonds. Should default in prompt payment with respect to the payment under these loans occur, future payments to the City under the HUD program would be held back and used as payment for these loans.

Annual Debt Service Requirements to Maturity

Finance Purchase - Fire Pump Trucks

On January 24, 2012, Resolution 2012-01-24-1504 approved the execution of a tax-exempt lease through OshKosh Capital in the amount of $1,795,506 to purchase 4 Pierce Fire Pumper Trucks. Modifications to the contract increased the lease amount to $1,871,404. The tax-exempt lease has annual lease payments of $213,300 with final payment due September 15, 2021, with an interest rate of 3.300%.

The four Pierce Pumper trucks purchased through Oshkosh Financing in this 2012 issuance are pledged. In the event of default payment or failure to make a ppropriations for the annual lease payments the aforementioned trucks may be subject to repossession. The City agrees to keep the vehicles purchased under this financing free of liens and encumbrances, and to keep the vehicles insured up to the remaining termination value of the lease.

The assets acquired through the capital lease are as follows:

The finance purchase was paid off during the year ended June 30, 2022.

Year Ending
June 30, Principal Interest
2023 1,830,000$ 89,979 $
2024 1,920,000 41,541
2025 615,000 8,204
Total 4,365,000$ 139,724 $
Notes Payable
U.S. Dept. of Housing & Urban Development
Fire Vehicle - Lease #3
Machinery and equipment 1,871,404$
Less: accumulated depreciation (1,164,429)
Total 706,975 $

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

81 Note 8 – Long-Term Liabilities (Continued)

A. Governmental Activities (Continued)

Lease Payable

The City has entered leases for the building and machine uses. The terms of the agreements range from 21 months to 59 months. The calculated interest rates used were betwee n 0.3080% to 0.56% based on the term of the agreements.

Principal and interest payments to maturity at June 30, 2022 are as follows:

B. Business-Type Activities

Summary of changes in business-type activities long-term debt for the year ended June 30, 2022, are as follows:

Year Ending
June 30, Principal Interest
2023 80,492$ 1,372$
2024 82,600 994
2025 83,329 611
2026 83,713 227
2027 5,468 2
Total 335,602$ 3,206$
Le ase s
Balance
July 1, 2021 Balance
W ater Utility Obligations (As restated) Additions Reductions Disc/Deferred June 30,2022 Short-Term Long-Term 2018A Water System Demand Revenue Bonds 135,295,000$ - $ (5,365,000)$ - $ 129,930,000$ 5,645,000 $ 124,285,000 $ Premium 13,141,408 - - (810,073) 12,331,335 - 12,331,335 54,245,000 (545,000) - 53,700,000 560,000 53,140,000 Subtotal Water Utility Oblig ations 202,681,408 - (5,910,000) (810,073) 195,961,335 6,205,000 189,756,335 W astewater Utility Obligations
2014 Wastewater Refunding Revenue Bonds 47,950,000 - (4,195,000) - 43,755,000 4,410,000 39,345,000 Premium (on 2014 refunding) 5,963,845 - - (729,982) 5,233,863 - 5,233,863 2019 Bond Anticipation Note 118,510,000 (118,510,000) - - - - 2020 EPA WIFIA loan - 108,000,000 108,000,000 - 108,000,000 Lease Payable - 8,758 (3,644) - 5,114 4,382 732 Subtotal Wastewater Utility Obligations 172,423,845 108,008,758 (122,708,644) (729,982) 156,993,977 4,414,382 152,579,595 Central Parking District
24,355,000 - (245,000) - 24,110,000 360,000 23,750,000 Premium 5,382,556 - - (209,710) 5,172,846 - 5,172,846 Lease Payable 2,812,689 - (170,056) - 2,642,633 169,052 2,473,581 Subtotal Central Parking District 32,550,245 - (415,056) (209,710) 31,925,479 529,052 31,396,427 Marina Operation
CDBW Harbor Facility Construction
and Planning Loans 10,870,821 - - - 10,870,821 - 10,870,821 Subtotal Marina Operation 10,870,821 - - - 10,870,821 - 10,870,821 Total - Enterprise Fund Activities Debt 418,526,319$ 108,008,758 $ (129,033,700) $ (1,749,765) $ 395,751,612 $ 11,148,434 $ 384,603,178 $ 2019A Water System Demand Taxable Revenue
2020 Parking Lease Revenue Bonds

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

82 Note 8 – Long-Term Liabilities (Continued)

B. Business-Type Activities (Continued)

Water Utility

Stockton Public Financing Authority Revenue Refunding Bonds Series 2018A

The 2018 Water Revenue Bonds, Series A were issu ed in the amount of $145,220,000 by the SPFA on November 20 2018. The SPFA issued the Bonds to refinance three series of bonds issued in 2002, 2005, and 2009, that finance multiple projects, including the majority of the financing for the Delta Water Supply Project. As of June 30, 2022, $129,930,000 of 2018A Bonds remain outsta nding with installments of principal ranging from $5,645,000 to $12,195,000 due October 1, 2022, through October 1, 2037, with interest rates ranging from 4.0% to

5.0%.

The repayment of the 2018A Bonds is from a pledge of available revenues of the fund. Available funds are net revenues of the fund and the 2018 Bonds have parity lie n with the 2019A bonds (see below). The principal amount due is reported net of the unamortized premium of $12,331,335, and unamortized loss on refunding of $5,884,651.

Stockton Public Financing Authority Water Revenue Re funding Bonds Series 2019A Federally Taxable (Green Bonds)

The 2019 Water Revenue Bonds, Series were issued in the amount of $54,785,000 by the SPFA on November 19 2019. The SPFA issued the Bonds to refina nce bonds issued in 2010 that financed the final portion of the Delta Water Supply Project. As of June 30, 2022 , $53,700,000 of 2019A Bonds remain outstanding with installments of principal ranging from $560,000 to $15,635,000 due from October 1, 2022, through October 1, 2040, with interest rates ranging from 2.145% to 3.61%. There was no gain or loss as a result of the current refunding.

The repayment of the 2019A Bonds is from a pledge of net revenues of the fund and the Bonds are issued on parity with the 2018A water bonds. The bonds were issued at par and are reported net of an unamortized loss on refunding of $6,110,331.

Pledged Revenues

The City has pledged future net system revenues from th e Water Fund for the repayment of all the Revenue Bonds of the Water Fund. For the year ended June 30, 2022, to tal principal and interest paid was $14,293,290 and net revenues were $35,287,899. Rate stabilization Funds balances at the end of FY 21/22 stand at $2,980,904. The total principal and interest remaining to be paid on the Water Utility Revenue Bonds are $270,140,505.

Events of default with finance related consequences a nd subjective acceleration are in cluded in section 7 of the indentures for both of the bonds listed above. These accel eration clauses only occur upon continued default in payment of performance of covenanted actions and receipt of a written request of not less than a majority of the bondholders, after which the Trustee would pull from funds on hand under the separate s ection of the agreement, and then upon court order from net revenues of the system held by the City.

The bonds and notes of the Water Utility are secured by and payable from certain revenues of the City's water enterprise fund (the “Water Fund”), amounts that are derived from "property related fees" collected by the City for water service. Application of amounts in the Water Fund is governed by the requirements of Article XIIID, Section 6 of the California Constitution, which provides that the Water Fund may only be used for the water enterprise and may not be used for general governmental purposes. The City is in compliance with its covenants in connection with its obligations, including covenants on the current rates and charges, and the Water Fund has revenues sufficient to meet the operation and maintenance costs of the water ente rprise, scheduled debt service and required debt service coverage.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

83 Note 8 – Long-Term Liabilities (Continued)

B. Business-Type Activities (Continued)

Debt Covenants

The Revenue Bonds all require the maintenance of a financial covenant of minimum debt service coverage (DSC) ratio. The minimum DSC ratio for the water bonds is 115% of net system revenues, which are pledged for repayment of the revenue bonds. The DSC ratio is the measure of the Water Fund’s ability to have sufficient resources to pay its debt service. The Water Fund has met its DSC for the fiscal year ended June 30, 2022.

Unused lines of Credit

There are no unused lines of credit as it pertains to the operation of the water utility.

Wastewater Utility

Stockton Public Financing Authority Wastewater Revenue Refunding Bonds, Series 2014

Wastewater Revenue Refunding Bonds, Series 2014 (1998 Wastewater Project and 2003 Wastewater Project) were issued in an amount of $69,440,000 by the SPFA on November 24, 2014. As of J une 30, 2022, bonds totaling $43,755,000 are due in annual installments of pr incipal ranging from $4,410,000 to $6,530,000 from September 1, 2022, through September 1, 2029, with interest rates of 5.00% on the bonds outstanding. The Bonds were issued to advance refund the 1998 and 2003 certificates of participation. Repayment of the Bonds is a pledge of net revenues of the Wastewater Fund. With the im plementation of Government Accounting Standard Board (“GASB”) Statement No. 65, the balance of the loss on refunding is reported as a deferred outflow of resources and at June 30, 2022, there is $1,223,060 outstanding. The principal amount due is reported net of the unamortized premium of $5,233,863.

Stockton Public Financing Authority Wastewater Bond Anticipation Notes, Series 2019

Wastewater Bond Anticipation Notes, Series 2019 (the “Not es”) were issued in an amount of $118,510,000 by the SPFA on October 22, 2019. As of June 30, 2022, notes tota ling $118,510,000 were due to be repaid June 1, 2022, were outstanding at a rate of 1.40%, and were callable any time after June 1, 2021, should future financings provide cheaper financing. The Notes were issued to provide initial funding to commence with the Regional Wastewater Control Facility upgrades, which are necessary to maintain compliance with updated state and federal standards.

Repayment of the notes is from a pledge of net revenues of the Wastewater Fund and the Notes are issued on parity with the 2014A bonds. The Notes were issued without pr emium or discount. The Notes were paid off during the year ended June 30, 2022.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

84 Note 8 – Long-Term Liabilities (Continued)

B. Business-Type Activities (Continued)

Wastewater Utility (Continued)

Stockton Public Financing Authority- 2020 Water Infrastructure Finance and Innovation Act (WIFIA) Loan

The WIFIA loan was entered into with the U.S. Environmental Protection Agency (the“EPA”) on September 29, 2020, and secured long-term financing in the amount of $108.000,000 at a rate of 1.20%. The payments are interest only until March 1, 2030. As of June 30, 2022, bonds totaling $108,000,000 are due in annual installments of principal ranging from $4,318,797 to $5,548,218 from March 1, 2030 through March 1, 2051.

Proceeds of the WIFIA loan were taken out in November 2021, and together with cash on hand, were used to redeem the 2019 Bond Anticipation Notes (BANs) in the amount of $118,510,000 on December 1, 2021.

This long-term financing is for the Regional Wastewater Control Facility upgrades, which are necessary to maintain compliance with updated state and federal standards. Repayment of the WIFIA loan is from a pledge of net revenues of the Wastewater Fund and the loan is issued on parity with the 2014A bonds. The loan was issued at par value.

In the event of default, 1) the EPA may suspend or termin ate all of its obligations with respect to the disbursement of any undisbursed amounts of the loan, 2) may apply the default rate provisions of the interest rate specified in the agreement, 3) may suspend or debar the City from further participation in any government program administered by the EPA and to notify other departments and agencies of such default; and/or be 4) entitled and empowered to institute any actions or proceedings at law or in equity for the collection of any sums due and unpaid.

Pledged Revenues

The City has pledged future net revenues from the Wastewater Fund for the repayment of the Bonds and Notes. For the year ended June 30, 2022, the City paid total principal and interest of $7,695,195, and an additional $10,510,000 in cash was utilized to redeem the 2019 BANs, and ha d net revenues of $30,847,429. Rate stabilization Funds balances at the end of FY 21/22 sta nd at $12,998,654. On June 30 , 2022, the total principal and interest remaining to be paid on the Wastewater Bonds are $185,740,402.

The bonds of the Wastewater Utility are secured by and payable from certa in revenues of the City's wastewater enterprise fund (the “Wastewater Fund”), amounts that are derived from "property related fees" collected by the City for wastewater service. Application of amounts in the enterprise fund is governed by the requirements of Article XIIID, Section 6 of the California Constitution, which provi des that the enterprise fund may only be used for the wastewater enterprise and may not be used for general gove rnmental purposes. The City is in compliance with its covenants in connection with its obl igations, including covenants on the current rates and charges, and the wastewater Fund has revenues sufficient to meet the ope ration and maintenance costs of the wastewater utility, scheduled debt service and required debt service coverage.

Debt Covenants

The Bonds requires the maintenance of a financial covena nt of minimum debt service coverage (DSC) ratio. The minimum DSC ratio for Bonds is 115% of Adjusted Net System Revenues which are pledged toward repayment of all bonds. The DSC ratio is the measure of the Wastewater Fund’s ability to have sufficient resources to pay its debt service. The Wastewater Fund has met its DSC for the fiscal year ended June 30, 2022, at each measurement period.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

85 Note 8 – Long-Term Liabilities (Continued)

B. Business-Type Activities (Continued)

Wastewater Utility (Continued)

Unused lines of Credit

There were no unused lines of credit as it pertains to the operation of the wastewater utility.

Lease Payable

On 09/10/2021, the City entered into a 23 month lease as Lessee for the use of Building ID 32627. An initial lease liability was recorded in the amount of $8,758 as of 06/30/2022, the value of the lease liability is $5,114. Stockton, CA is required to make monthly fixed payments of $366.00. The lease has an interest rate of 0.3080%. The buildings estimated useful life was 23 months as of the contract commencement. The value of the right to use asset as of 06/30/2022 of $8,758 with accumulated amortization of $3,585 is included with Buildings on the Lease Class activities.

Parking Authority

Stockton Public Financing Authority- Parking Revenue Bonds, Series 2020

The 2020 Parking Revenue Bonds were issued in the amount of $24,355,000 by the SPFA on February 12, 2020.

As of June 30, 2022, the 2020 Parking Bonds totaling $24,110,000 are due in annual installments of principal ranging from $360,000 on March 1, 2022 to $1,605,000 on March 1, 2047, with interest rates ranging from 4.00% to 5.00%, and a final maturity date of March 1, 2047. The 2020 Parking Bonds were issued to refund the bankruptcy settlement on the 2004 Parking bonds, and along with payments from the bond insurer, to payoff the holders of the 2004 Parking bonds, and to provide $3 million in capital funding to finance repairs and upgrades to facilities. The 2004 bonds had financed the construction of the Stockton Events Center Parking Structure, the Edward S. Coy Parking Garage, and other parking facilities within the Parking Authority.

The repayment of the 2020 Bonds is from a pledge of net revenues of the fund. The principal amount due is reported net of the unamortized premium of $5,172,846, and unamortized loss on refunding of $427,240.

Lease Payable

The City has entered leases for the land, land improvements, buildings. The terms of the agreement range from 21 to 183 months. The calculated interest rates used were 0.3080% to 1.5120% based on the term of the agreements. The total principal and interest remaining to be paid on the lease payable are $2,936,618.

Pledged Revenues

The City has pledged future net revenues from the Parki ng Authority Fund for the repayment of the settlement liability. For the year ended June 30, 2022, the City pa id total principal and inte rest of $1,419,200 and had net revenues of $836,762.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022
86 Note 8 – Long-Term Liabilities (Continued)
B. Business-Type Activities (Continued)
Downtown Marina
Construction and Planning
Loans
On March 17, 1997, the City entered into an agreement w ith the California Department of Boating and Wa terways
(“DBAW”) for a planning loan to provide funding for a feasibility study regarding the potential construction of waterfront improvements. That feasibility study was approved on May 16, 2000, and the City entered into an agreement with DBAW for the construction loan to deve lop a small craft harbor f acility on August 9, 2004.

Engineering work began in the fiscal year 2006. Construc tion of the facility started during the fiscal year ended June 30, 2009, and the project was completed in 2011. The principal remaining to be paid on both the planning and construction loans as of June 30, 2022 is $10,870,821.

The construction note was scheduled to be repaid under a 30-year repayment schedule at 4.5% interest beginning in August 2011. Repayment of the Note is secured by a pledge of the gross revenues of the Downtown Marina, which have been insufficient to pay the full debt service. The loan provides that, subject to the requirements of Article XVI, Section 18 of the California Constitution (the “Debt Limit”), the City will make up any shortfall in debt service after application of Marina revenues. The Marina does not currently generate sufficien t annual revenues to cover operational costs (net of debt service), and the City continues to provide an annual subsidy to the operator to cover this shortfall.

Under a settlement agreement with the Department of Boating and Waterways (DBAW), net revenues of the marina are pledged toward reducing the liability. The marina opera tes on a subsidy from the City and, absent that subsidy, is anticipated to operate at a loss for the foreseeable future. It is anticipated that settlement payments with the bond insurer for the 2004 bonds. There is a covenant to set rates such that they will provide net coverage for Operation and Maintenance (including the settlement payments) of 1.0 coverage. There ar e no events of default with finance related consequences and subjective acceleration clauses do not exist with respect to these frozen obligations.

The City’s settlement with DBAW as to the treatment of this obligation was confirmed as Part of the City’s Approved Bankruptcy Plan of Adjustment. The terms of the settlement call for the outstanding principal to be paid from net operating revenues of the Marina operation, with no interest accruing on the unpaid portion. The settlement removes the General Fund backing and a reserve fund bala nce formerly in place in the General Fund has been removed. With operations continuing to receive an a nnual subsidy, it is unknown when any principal reduction payment will occur. The debt paym ent schedule was not included in the table listed below in the “Annual Debt Service Requirements to Maturity” table.

Annual Debt Service Requirements to Maturity
W ater Utility W astew ater Utility
Year Ending
June 30, Principal Interest Principal Interest Principal Interest Principal Interest Principal Interest 2023 6,205,000$ 8,096,450$ 4,410,000$ 2,077,500$ -$ 1,296,000$ 360,000$ 1,161,950$ 173,434$ 38,796$ 2024 6,220,000 7,801,588 4,635,000 1,851,375 - 1,296,000 545,000 1,143,950 172,358 36,214 2025 6,530,000 7,498,223 5,090,000 1,608,250 - 1,296,000 570,000 1,116,700 174,239 33,601 2026 6,860,000 7,178,633 5,345,000 1,347,375 - 1,296,000 600,000 1,088,200 176,891 30,949 2027 7,215,000 6,841,793 5,620,000 1,073,250 - 1,296,000 630,000 1,058,200 179,585 28,255 2028-2032 41,980,000 28,487,376 18,655,000 1,430,125 8,689,419 6,376,038 3,655,000 4,786,000 939,779 99,421 2033-2037 55,205,000 16,879,795 - - 22,652,525 5,285,544 4,660,000 3,776,250 831,461 26,759 2038-2042 53,415,000 3,726,648 - - 24,044,689 3,885,026 5,790,000 2,650,000 - - 2043-2037 - - - - 25,522,413 2,398,436 7,300,000 1,130,500 - - 2048-2052 - - - - 27,0
90,954 820,484 - - - - Total 183,630,000$ 86,510,505$ 43,755,000$ 9,387,875$ 108,000,000$ 25,245,528$ 24,110,000$ 17,911,750$ 2,647,747$ 293,995$ Central Parking District
Le ase sRev enue Bonds Rev enue Bonds Settlement L iabilityWIFIA Loan

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

87 Note 8 – Long-Term Liabilities (Continued)

C. Fiduciary Fund Activities

Summary of changes in fiduciary fund long-term liabilities for the year ended June 30, 2022, are as follows:

Successor Redevelopment Agency

There are no unused credit lines for any Successor Agency debt. A pledge of tax revenues received by the Successor Agency as described below is the only source of payment pledged on these bonds and no real property is pledged as collateral. Section 10 of the indenture lists events of de fault that if uncured, may, with consent of 25% of the registered owners, result in acceleration of the bonds. Should this occur, funds held by the trustee will be immediately used to satisfy any defaulted payment. Subsequently, th e bond insurer would be required to satisfy bondholders as payments become due. Upon court order, Tax Revenues received by the Agency would be transmitted to the Trustee, or Insurer to satisfy reimbursement. The bond insurer, at its option may satisfy the accelerated payments and seek reimbursement from Tax Revenues received by the Agency.

2016 Tax Allocation Refunding Bonds, Series A and B (Federally Taxable)

The Successor Agency issu ed the 2016 Tax Allocation Bonds, Seri es A in the amount of $73,310,000 on November 3, 2016 to provide funds to refinance bonds issu ed in 2004 to finance a portion of the downtown Arena, and 2006 Series A bonds used to finance redevelopment projects in the North, South, and Midtown projects areas of the former Redevelopment Agency.

As of June 30, 2022, the 2016 Series A Bonds totaling $73,310,000 are due in annual installments of principal ranging from $610,000 on September 1, 2024 to $7,195,0 00 on September 1, 2037, with final payment on September 1, 2037, with interest rates ranging from 3.25% to 5.00%. The principal amount due is reported net of the unamortized premium of $6,849,237.

The 2016 Tax Allocation Bonds, Series B (Federally Taxa ble) were issued in the amount of $30,010,000 on November 3, 2016 to provide funds to refinance Certif icates of Participation issued in 2003 to finance the construction of capital improvements to provide redevelopment housing in the City of Stockton, and R2006 Series C Bonds issued to finance certain low and moderate-income housing projects throughout the City of Stockton.

As of June 30, 2022, the 2016 Series B Bonds totaling $11,180,000 are due in annual installments of principal ranging from $3,840,000 to $3,925,000 due in annual installments through on September 1, 2024, with interest rates ranging from 2.375% to 2.75%. The principal amount due is reported net of the unamortized discount of $70,195.

Balance Balance
S uccessor Agency to RDA of S tockton July 1, 2021 Additions Reductions June 30, 2022 Current Non-Current Revenue Bonds
73,310,000$ - $ - $ 73,310,000$ - $ 73,310,000$ Premium 7,412,188 - (562,951) 6,849,237 562,951 6,286,286 14,940,000 - (3,760,000) 11,180,000 3,840,000 7,340,000 Discount (102,591) - 32,396 (70,195) (32,396) (37,799) Total Successor Agency to RDA L iabilities 95,559,597$ -$ (4,290,555)$ 91,269,042$ 4,370,555$ 86,898,487$ 2016 Series A Successor Agency
Tax Allocation Bonds
2016 Series B Successor Agency
Tax Allocation Bonds (Taxable)

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

88 Note 8 – Long-Term Liabilities (Continued)

C. Fiduciary Fund Activities (Continued)

The 2016 Series A and B bonds are limited obligations of the Successor Agency secured by a first charge and lien on, and a security interest in Tax Revenues received by th e Successor Agency pursuant to the laws of the State of California related to Redevelopment Property Tax Tr ust Fund (“RPTTF”) and the revenues of the former Redevelopment Agency under California Health and Safe ty Code Sections 34183 and 34170.5(b), whereby the County Auditor-Controller is obligated to deposit the Tax Revenues into the RPTTF.

A pledge of tax revenues received by the Successor Agency as described below is the only source of payment pledged on these bonds and no real property is pledged as collateral. Section 10 of the indenture lists events of default that if uncured, may, with consent of 25% of the registered owners, result in acceleration of the bonds. Should this occur, funds held by the trustee will be immediately used to satisfy any defaulted payment. Subsequently, the bond insurer would be required to satisfy bondholders as payments become due. Upon court order, Tax Revenues received by the Agency would be transmitted to the Trustee, or Insurer to satisfy reimbursement. The bond insurer, at its option may satisfy the accelerated payments and seek reimbursement from Tax Revenues received by the Agency.

Annual Debt Service Requirements to Maturity

D. Debt Without City Commitment

Community Facilities Districts Debts:

Land Secured Debt Financing (No City Commitment) – Th e City has authorized the formation of community facilities districts (CFDs) and assessment districts (called local improvement districts) or LIDs and the issuance of bonds under various public improvement acts of the State of California to finance eligible public facilities necessary to serve developing commercial, industrial, residential and/or mixed-use developments. The bonds are secured by annual special tax levies or liens placed on the property within the districts.

The City is not liable for repayment and is only responsib le for collecting the special taxes or assessments, making payment from the special taxes or assessments to bond holders, and initiating foreclosure proceedings when necessary. These bonds are payable sole ly from special taxes or assessments, specific reserves, and the proceeds from property foreclosures. Accordingly, the bonds are not reported as liabilities in the City’s basic financial statements. As of June 30, 2022, there was five CFD special tax bonds and four revenue bonds outstanding with aggregate principal amounts payable of $29,009,000 and $57,130,000, respectively.

Year
Endi ng
June 30, Principal Interest Principal Interest
2023 -$ 3,373,800$ 3,840,000$ 237,638$ 2024 - 3,373,800 3,925,000 142,975 2025 610,000 3,358,550 3,415,000 46,956 2026 4,150,000 3,239,550 - - 2027 4,360,000 3,026,800 - - 2028-2032 25,290,000 11,551,500 - - 2033-2037 31,705,000 5,080,088 - - 2038-2042 7,195,000 149,688
Total 73,310,000$ 33,153,776$ 11,180,000$ 427,569$ 2016 Series A Successor Agency Tax
Allocation Bonds
2016 Series B Successor Agency Tax
Allocation Bonds (Taxable)

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

89 Note 8 – Long-Term Liabilities (Continued)

D. Debt Without City Commitment (Continued)

E. Conduit Debt

Conduit Debt (No City Commitment) – At June 30, 2022, there is no conduit debt outstanding that was issued with the City as the conduit issuer.

Note 9 – Accrued Compensated Absences

The value of all accumulated vacation and longevity vacation allowance is accrued, as appropriate, for all funds. Earned but unused sick is not accrued starting with negotiated bargaining unit contracts that began in the fiscal year 2012-13 and continued through Ju ne 30, 2022. The bargai ning unit contracts state that all sick time accrual has no cash value upon separation from the City.

The compensated absence accrual is presented in the Govern ment-Wide and Business Type proprietary fund financial statements. The changes in compensated absences of governmental and business-type activities are as follows:

Amount of Issue Outstanding
June 30, 2022
CFD Special Tax Bond:

Cannery Park CFD 2005-1 Series 2019 9,855,000 $ 9,245,000 $ CFD 2018-12018 Arch Road/Newcastle 3,535,000 3,325,000 Westlake CFD 2006-2 SERIES 2019 ( Private Placement) 3,134,000 2,934,000 Westlake Villages II Imp Area 1A (Series 2020) 8,970,000 8,970,000 Westlake Villages II Imp Area 1A (Series 2021) 4,535,000 4,535,000 Subtotal CFD Special Tax Bond 29,009,000
Revenue Bond:
2016 Combined Refunding 33,350,000$ 24,900,000$
CFD 99-02 2018 Arch Road East 24,210,000 22,970,000 AD 2014-01 Mosher Estates 13,020,000 9,155,000 2001 Combined Assessment District Refunding 1,989,000 105,000 Subtotal Revenue Bond 57,130,000
Total Noncity Obligation 86,139,000$
Governmental Business-Type
Activities Activities Total
Beginning July 1, 2021 13,116,890$ 1,593,181$ 14,710,070$ Additions 8,123,283 1,245,680 9,368,964 Payments (9,284,972) (1,398,955) (10,683,927) Balance June 30, 2022 11,955,201$ 1,439,906$ 13,395,107$ Current Portion 6,724,018$ 917,209$ 7,641,227$ Noncurrent Portion 5,231,183$ 522,697$ 5,753,880$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

90 Note 10 – Unamortized Loss on Refunding

Summary of changes in unamortized loss on refunding for the year ended June 30, 2022:

Note 11 – Fund Balances

A summary of the City’s fund balance classification as nonspendable, restricted, committed, assigned and unassigned reported in the City’s Governmental Funds balance sheet at June 30, 2022, are as follows:

Balance
July 1, 2021 Additions Deletions Balance
June 30, 2022
Municipal Utility E nterprise Debt Obligations
2018 Water Refunding 6,271,226 $ - $ (386,576)$ 5,884,651 $ 2019 Water Refunding 6,445,144 - (334,813) 6,110,331 2014 Wastewater Refunding Revenue Bonds 1,393,644 - (170,583) 1,223,060 Subtotal - Municipal Utility E nterprise Debt 14,110,014 - (891,972) 13,218,042 Parking Authority
2020 Parking Revenue Bonds 444,560 - (17,321) 427,240 Total Deferred Amount on Refunding 14,554,574$ - $ (909,292)$ 13,645,282 $ Other Total
General Federal Housing Special Capital Governmental Governmental Fund Grants Grants Improvement Funds Funds
Fund balances:

Nonspendable:

Inventories 521,303 $ - $ - $ - $ - $ 521,303$ Prepaid expense 24,042 - - - 25,315 49,357 Advance deposits 1,532,011 - - - 125,387 1,657,398 Total Nonspendable 2,077,356 - - - 150,702 2,228,058 Restricted for:

Section 108 Loan 1,277,452 - - - - 1,277,452 Community development - - - - 51,123,327 51,123,327 Debt service reserve - - - - 1,953,877 1,953,877 General government - - - - 4,565,789 4,565,789 Housing - 86,380,858 - - 77,554,740 163,935,598 Libraries and arts 3,029,784 - - - 6,067,444 9,097,228 Parks and recreation 972,956 - - - 39,011,095 39,984,051 Public safety 9,177 - 36,802,822 - 14,943,908 51,755,907 Solid waste/recycling - - - - 5,994,885 5,994,885 Streets, transit & traffic - - - 19,594,192 84,311,836 103,906,028 Tota
l Restricted 5,289,369 86,380,858 36,802,822 19,594,192 285,526,901 433,594,142 Committed for:

General government operations 123,753,548 - - - - 123,753,548 Total Committed 123,753,548 - - - - 123,753,548 Assigned for:

General government operations 4,284,719 - - - - 4,284,719 Total Assigned 4,284,719 - - - - 4,284,719 Unassigned: 43,208,401 - - - - 43,208,401 Total Fund Balances 178,613,393$ 86,380,858$ 36,802,822$ 19,594,192$ 285,677,603$ 607,068,868$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

91 Note 12 – Retirement Plans

The City contributes to three pension plans: The Safety Plan of the City of Stockton; the Miscellaneous Plan of the City of Stockton, which are both part of the Public Agency por tion of the California Public Employees’ Retirement System (“CalPERS”); and the City of Stockton Retirement Enha ncement Plan, a customized supplemental retirement plan administered by Public Agency Retirem ent Services (“PARS”) for municipal utilities employees, who worked under a private contract between 2003 and 2008.

Summary:

Governmental Business Type
Deferred Outflows of Resources: Activites Activities Total CalPERS:

Safety
Contributions made after measurement date 39,176,629 $ - $ 39,176,629$ Differences between expected and actual experience 1,939,230 - 1,939,230 Total Safety Plan 41,115,859 - 41,115,859 Miscellaneous
Contributions made after measurement date 18,698,854 1,798,657 20,497,511 Total Miscellaneous Plan 18,698,854 1,798,657 20,497,511 PARS
Change in assumptions - 100,836 100,836 Differences between expected and actual experience - 57,138 57,138 Difference between projected and actual investment earnings - 1,032,633 1,032,633 Total PARS Plan - 1,190,607 1,190,607 Total Pensions related Deferred Outflows of Resources 59,814,713$ 2,989,264 $ 62,803,977 Net Pension L iability:

CalPERS:

Safety 260,738,763 $ - $ 260,738,763$ Miscellaneous 52,776,609 5,076,621 57,853,230 PARS - 3,314,753 3,314,753 Total Net Pension L iability 313,515,372$ 8,391,374$ 321,906,746$ Deferred Inflows of Resources:

CalPERS:

Safety
Change in assumptions 183,436$ -$ 183,436$ Differences between expected and actual experience 8,133,062 - 8,133,062 Difference between projected and actual investment earnings 88,410,848 - 88,410,848 Total Safety Plan 96,727,346 - 96,727,346 Miscellaneous
Differences between expected and actual experience 4,855,157 467,021 5,322,178 Difference between projected and actual investment earnings 61,122,687 5,879,436 67,002,123 Total Miscellaneous Plan 65,977,844 6,346,457 72,324,301 PARS
Differences between expected and actual experience - 26,109 26,109 Total PARS Plan - 26,109 26,109 Total Pension Deferred Inflows of Resources 162,705,190$ 6,372,566$ 169,077,756$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

92 Note 12 – Retirement Plans (Continued)

A. CalPERS Retirement Plan

General Information about Pension Plans

CalPERS is an agent multiple-employer agency trust, that acts as a common investment and administrative agent for participating public entities in the State of California and provides retirement, disability and death benefits to plan members and beneficiaries. CalPERS benefits are payable monthly for life in an amount equal to a certain percent of the employee's highest annual salary. Benefit provisions and all other requirements are established by contract with CalPERS, State statute, and City ordinance. Copies of the CalPERS comprehensive annual financial report may be obtained from the CalPERS Executive Office, 400 Q Street, Sacramento, CA, 95811.

Plan Description – All qualified permanent and probationary employ ees are eligible to participate in the City of Stockton’s separate Safety (police and fire) and Miscellaneous (all other) Plans, agent multiple-employer defined benefit pension plans administered by CalPERS, which acts as a common investment a nd administrative agent for its participating member employers. Benefit provisions under the Plans are established by state statute and City resolution. CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.

The Safety Plan is for sworn Police and Fire employees. The contribution requirements of the plan members and the City are established and may be amended by CalPERS.

The Miscellaneous Plan is available to full-time employees not enrolled in the Safety Plan. Part-time employees must meet specific criteria for participation. City employ ees are eligible for service or normal retirement at age 55 or older with a minimum of five years CalPERS service. The contribution requirements of the plan members and the City are established by CalPERS and may be amended.

Benefits provided – CalPERS provides service retirement and disability benefits, the annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits for public safety employees are calculated based on the employ ee’s highest earning year for Classic members or as a percentage of the employee’s final 3-year average sala ry for PEPRA (California Employees’ Pension Reform Act of 2013 PEPRA members) multiplied by the employees’ years of service. Public safety employees with ten years of continuous service are eligible to retire at age 55. Pub lic safety employees may retire at any age after 20 years of service. The Plans’ provisions and benefits in effect at June 30, 2022, are summarized as follows:

Hire Date Prior to January 1, 2014 After January 1, 2014 Benefit Vesting Schedule 5 years service 5 years service Benefit Formula
Tier II Fire: 3% @ 55 years of age
All Other: 3% @ 50 years of age 2.7% @ 57 years of age
Benefit Payments monthly for life monthly for life
Required Employee Contribution Rates 9.00% 12.75%
Required Employer Contribution Rates 21.01% 21.01%
Safety
Hire Date Prior to January 1, 2014 After January 1, 2014 Benefit Vesting Schedule 5 years service 5 years service Benefit Formula
Tier I: 2% @ 55 years of age
Tier II: 2% @ 60 years of age 2% @ 62 years of age
Benefit Payments monthly for life monthly for life
Required Employee Contribution Rates 7.00% 6.75%
Required Employer Contribution Rates 10.22% 10.22%
Miscellaneous

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

93 Note 12 – Retirement Plans (Continued)

A. CalPERS Retirement Plan (Continued)

General Information about Pension Plans (Continued)

Employees Covered - At June 30, 2021, the measurement date, the following employees were covered under benefit terms:

Contributions – The City establishes rates based on an actuarially determined rate recommended by an independent actuary. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by the employee during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees.

For the year ended June 30, 2022, the Safety Plan employer contribution rate was 21.01% of wages. The Miscellaneous Plan was 10.22% of wages.

Net Pension Liability

The City’s net pension liability was measured as of J une 30, 2021, using an annual actuarial valuation as of June 30, 2020, applying standard update procedures.

Actuarial assumptions – The total pension liability on June 30, 2021, the actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement:

Safety Plan Miscellaneous Plan
Inactive employees or beneficiaries currently receiving benefits 922 1561 Inactive employees entitled to but not yet receiving benefits 459 1470 Active employees 597 960
1978 3991
Safety Plan Miscellaneous Plan
Valuation Date 6/30/2020 6/30/2020
Measurement Date 6/30/2021 6/30/2021
Actuarial Cost M ethod
Actuarial Assumptions:

Discount Rate 7.15% 7.15%
Inflation 2.50% 2.50%
Payroll Growth 2.75% 2.75%
Projected Salary Increase Varies
(1) Varies (1)
M ortality see note (2) see note (2)
(1) Depending on age, service and type of employment
(2)
Entry Age Normal in accordance with the requirements of GASB 68 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% 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.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

94 Note 12 – Retirement Plans (Continued)

A. CalPERS Retirement Plan (Continued)

Net Pension Liability (Continued)

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

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

The expected real rates of return by asset class are as follows:

Discount rate – The discount rate used to measure the total pension liability was 7.15%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Pl an’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.

On July 12, 2021, CalPERS reported a preliminary 21.3% net return on investments for fiscal year 2020-21. Based on the thresholds specified in CalPER S Funding Risk Mitigati on policy, the excess return of 14.3% prescribes a reduction in investment volatility that corresponds to a reduction in the discount rate used for funding purposes of

0.20%, from 7.00% to 6.80%. Since CalPERS was in the fi nal 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.

Asset Class
1 Assumed Asset
Allocation
Real Return Years
1-10
(2)
Real Return Years
11+
(3)
Public Equity 50.0% 4.80% 5.98%
Fixed Income 28.0% 1.00% 2.62%
Inflation Assets 0.0% 0.77% 1.81%
Private Equity 8.0% 6.30% 7.23%
Real Assets 13.0% 3.75% 4.93%
Liquidity 1.0% 0.00% -0.92%
Total 100.00%
(2) An expected inflation of 2.00% used for this period. (3) An expected inflation of 2.92% used for this period. (1) In the System's ACFR, Fixed Income is included in Global Debt Securities; Liquidity is included in Short-term Investments; Inflation Assets are included in both Global Equity Securities and Global Debt

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

95 Note 12 – Retirement Plans (Continued)

A. CalPERS Retirement Plan (Continued)

Net Pension Liability (Continued)

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% (net of investment expense but without a reduction for administrative expense) for financial reporting purposes. This includes a reduction in the price inflati on assumption from 2.50% to 2.30% as recommended in the November 2021 CalPERS Experience Study and Review of Actuarial Assumptions. This study also recommended modifications to retirement rates, termin ation 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.

Changes in the Net Pension Liability

The changes in the Net Pension Liability for each Plan are as follows:

Total Pension Plan Fiduciary Net Pension
L iability Net Position L iability
(a) (b) (a) - (b)
Balances at 06/30/2020 1,177,044,021$ $ 788,337,261 388,706,760$ Changes for the year:

Service cost 17,442,651 - 17,442,651 Interest on total pension liability 82,106,386 - 82,106,386 Changes of Assumption - - - Differences between expected and actual experience (5,649,159) - (5,649,159) Net plan to plan resource movement - - - Contributions-employer - 37,208,895 (37,208,895) Contributions-employee - 7,775,415 (7,775,415) Net investment income - 177,671,066 (177,671,066) Benefit payments, including refunds of employee (63,550,272) (63,550,272) - Administrative expense - (787,501) 787,501 Other Miscellaneous Income (Expense) - - - Net Changes 30,349,606 158,317,603 (127,967,997) Balances at 06/30/2021 1,207,393,627$ 946,654,864$ 260,738,763$ Safety Plan
Increase (Decrease)

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

96 Note 12 – Retirement Plans (Continued)

A. CalPERS Retirement Plan (Continued)

Changes in the Net Pension Liability (Continued)

Sensitivity of the net pension liability to changes in the discount rate – The following presents the net pension liability of the City, calculated using the discount rate of 7.15 percent, as well as what the City’s 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:

Pension plan fiduciary net position – Detailed information about the pensi on plan’s fiduciary net position is available in the separately issued CalPERS financial report.

Total Pension Plan Fiduciary Net Pension
L iability Net Position L iability
(a) (b) (a) - (b)
Balances at 06/30/2020 762,322,881$ $ 603,352,840 158,970,041$ Changes for the year:

Service cost 11,194,084 - 11,194,084 Interest on total pension liability 53,055,641 - 53,055,641 Changes of Assumption - - - Differences between expected and actual experience (5,435,616) - (5,435,616) Net plan to plan resource movement - - - Contributions-employer - 20,363,651 (20,363,651) Contributions-employee - 4,939,316 (4,939,316) Net investment income - 135,230,666 (135,230,666) Benefit payments, including refunds of employee (40,894,732) (40,894,732) - Administrative expense - (602,713) 602,713 Other Miscellaneous Income (Expense) - - - Net Changes 17,919,377 119,036,188 (101,116,811) Balances at 06/30/2021 780,242,258$ 722,389,028$ 57,853,230$ Miscellaneous Plan
Increase (Decrease)
Safety Plan
1%
Decrease
Rate (6.15%)
Current
Discount
Rate (7.15%)
1%
Increase
Rate (8.15%)
Net pension liability 422,492,487$ 260,738,763$ 128,234,486$ Miscellaneous Plan
1%
Decrease
Rate (6.15%)
Current
Discount
Rate (7.15%)
1%
Increase
Rate (8.15%)
Net pension liability 155,132,371$ 57,853,230$ (23,004,058)$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

97 Note 12 – Retirement Plans (Continued)

A. CalPERS Retirement Plan (Continued)

Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions

As of measurement date June 30, 2021, the City report ed deferred outflows of res ources and deferred inflows of resources related to pensions from the following sources:

The $39,176,629 and $20,497,511 reported as deferred outflows of resources related to pension 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 year ending June 30, 2023. Other amounts reported as deferred outflows, and deferred inflows of resources related to pensions will be recognized in future pension expense.

Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Pension contribution subsequent to measurement date $ 39,176,629 $ - Changes of assumptions - (183,436) Differences between expected and actual experience 1,939,230 (8,133,062) Net differences between projected and actual
earnings on pension plan investments - (88,410,848) Total $ 41,115,859 $ (96,727,346)
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Pension contribution subsequent to measurement date $ 20,497,511 $ - Changes of assumptions - - Differences between expected and actual experience - (5,322,178) Net differences between projected and actual
earnings on pension plan investments - (67,002,123) Total $ 20,497,511 $ (72,324,301)
Safety Plan
Miscellaneous Plan
Deferred
Outflows/(Inflows)
of Resources.
2022 $ (23,822,026)
2023 (23,336,142)
2024 (23,083,596)
2025 (24,542,352)
2026 -
Thereafter -
Total $ (94,784,116)
Safety Plan
Measurement
periods
ended June 30:

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

98 Note 12 – Retirement Plans (Continued)

A. CalPERS Retirement Plan (Continued)

Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions (Continued)

B. PARS Enhancement Plan

General Information about Pension Plans

Plan Description – The PARS Retirement Enhancement Plan (REP), a closed retirement plan, provides retirement benefits for Municipal Utility Department employees for the period they worked for OMI-Thames Water Stockton, Inc. The City entered into an agre ement with Public Agency Retirement Services (the “PARS”) (a public sector retirement plan administrator specializing in providing public entities customized retirement plans and solutions) to contribute to a supplemental plan for employees joining or re-joining City service after having been employed between 2003 and 2008 by OMI-Thames, a private sector utility contractor. OMI-Thames employees did not earn CalPERS service credit during the period OMI-Thames operated the City utilities.

Benefits provided - Upon retirement, the REP benefits will supplem ent any CalPERS retirement for which those particular employees are eligible. Eligibility for the REP, a single-employer post-employment defined benefit plan, other than employment with OMI-Thames between 2003 and 2008, is defined as concurrent retirement with CalPERS and the City upon attaining age 55 and a minimum of 5 years of full-time continuous service with the City, with at least 1 year of continuous City service after March 1, 2008.

Employees covered - At June 30, 2020, valuation date, the following employees were covered by the benefit terms:

Contributions – The City establishes rates based on an actuarially determined rate recommended by an independent actuary. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by the employee during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees.

Deferred
Outflows/(inflows)
of Resources.
2022 (21,026,533)$
2023 (16,699,868)
2024 (16,058,257)
2025 (18,539,643)
2026 -
Thereafter -
Total (72,324,301)$
Misccellaneous Plan
Measurement
periods
ended June 30:

PARS E nhancement Plan
Inactive employees or beneficiaries currently receiving benefits 35 Inactive employees entitled to but not yet receiving benefits 0 Active employees 47
82 ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

99 Note 12 – Retirement Plans (Continued)

B. PARS Enhancement Plan (Continued)

Net Pension Liability

The City’s net pension liability was measured as of J une 30, 2022, using an annual actuarial valuation as of June 30, 2020, using standard update procedures.

Actuarial assumptions – The total pension liability on June 30, 2022, the actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement:

Discount rate – The discount rate used to measure the total pe nsion liability was 6.50 percent. The projection of cash flows used to determine the discount rate assumed that employee contribu tions will be made at the current contribution rate and that the City c ontributions will be made at rates equal to the difference between actuarially determined contribution rates and the employee rate. Based on those assumptions, the pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments of currently active and inactive employees. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

The long-term expected rate of return on pension plan investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation.

PARS E nhancement Plan
Valuation Date 6/30/2020
Measurement Date 6/30/2022
Actuarial Cost M ethod Entry-Age Normal Cost Method
Actuarial Assumptions:

Discount Rate 6.50%
Inflation 2.50%
Payroll Growth 2.75%
Projected Salary Increase 3.40% - 10.50% (1)
Investment Rate of Return 6.50%
Mortality see note (2)
(1) Depending on years of service.
(2) Pre-retirement: Consistent with Non-Industrial rates used to value the CalPERS Miscellaneous Public Agency Pension Plans after June 30, 2017.

Post-Retirement: Consistent with Non-Industrial rates used to value the CalPERS Miscellaneous Public Agency Pension Plans after June 30, 2017.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

100
Note 12 – Retirement Plans (Continued)

B. PARS Enhancement Plan (Continued)

Net Pension Liability (Continued)

The target allocation and best estimates of real arithmetic rates of return for each major asset class are summarized in the following table:

Changes in the Net Pension Liability

The changes in the Net Pension Liability for the Plan are as follows:

Asset Class Estimated Allocation
Long-Te rm
Expe cte d
Arithmetic Real
Rate of Return
Long-Te rm
Expe cte d
Geometric Real
Rate of Return
US Cash 6.23% 0.21% 0.20%
US Core Fixed Income 46.31% 1.95% 1.84%
US Broad Equity Market 37.82% 5.70% 4.10%
Foreign Developed Equity 4.76% 6.99% 5.25%
Emerging Markets Equity 3.11% 9.44% 5.97%
USREITs 1.77% 6.27% 4.11%
Total 100.00%
Assumed Inflation - Mean 2.35% 2.35%
Assumed Inflation - Standard Deviation 1.25% 1.25%
Portfolio Real Mean Return 3.81% 3.41%
Portfolio Nominal Mean Return 6.16% 5.84%
Portfolio Standard Deviation 8.26%
City's Long-Term Expected Rate of Return 6.50%
PARS E nhancement Plan
Total Pension Plan Fiduciary Net Pension
L iability Net Position L iability
(a) (b) (a) - (b)
Balances at 06/30/2021 12,636,141$ $ 10,681,302 1,954,839 $ Changes for the year:

Service cost 135,750 - 135,750 Interest on total pension liability 809,517 - 809,517 Effect of economic/demographic gains or losses - - - Effect of assumptions changes or inputs - - - Benefit payments (645,746) (645,746) - Employer Contributions - 1,055,182 (1,055,182) Net investment income - (1,452,185) 1,452,185 Administrative expense - (17,644) 17,644 Net Changes 299,521 (1,060,393) 1,359,914 Balances at 06/30/2022 12,935,662$ 9,620,909 $ 3,314,753 $ Increase (Decrease)
PARS E nhancement Plan

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

101
Note 12 – Retirement Plans (Continued)

B. PARS Enhancement Plan (Continued)

Sensitivity of the net pension liability to changes in the discount rate – The following presents the net pension liability of the City, calculated using the discount rate of 6.50 percent, as well as what the City’s net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (5.50 percent) or 1-percentage- point higher (7.50 percent) than the current rate:

Pension plan fiduciary net position – Detailed information about the pens ion plan’s fiduciary net position is available in the separately issued REP financial report.

Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions

At June 30, 2022, the City reported de ferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

The amounts above are net of outflows and inflows recognized in the 2021-2022 measurement period expense.

Amounts reported as deferred outflows and deferred inflows of resources related to pensions will be recognized in future pension expense as follows:

1%
Decrease
Rate (5.50%)
Current
Discount
Rate (6.50%)
1%
Increase
Rate (7.50%)
Net pension liability 4,840,934$ 3,314,753$ 2,025,531$ PARS E nhancement Plan
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Changes of assumptions $ 100,836 $ - Differences between expected and actual experience 57,138 (26,109) Net differences between projected and actual
earnings on pension plan investments 1,032,633 - Total $ 1,190,607 $ (26,109)
PARS E nhancement Plan
Deferred
Outflows/(inflows)
of Resources.
2023 331,319 $
2024 240,381
2025 160,996
2026 431,802
2027 -
Thereafter -
Total 1,164,498$
Measurement
periods
ended June 30:

PARS E nhancement Plan

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

102
Note 12 – Retirement Plans (Continued)

C. Retirement Benefits Fund (Section 115 Trust)

The Retirement Fund is used to make contributions to the California Public Employees’ Retirement System (CalPERS) for the City’s defined benefit programs. Also accounted for in the Retirement Fund are monies in the form of an IRS approved Section 115 Plan, set aside to pay for future payment increases announced by CalPERS.

At the end of fiscal year 2021-22, the Section 115 Plan , has $69.9 million available to fund the annual liability payments. The Trust is monitored by the Administrative Services and Human Resources Departments.

Note 13 – Claims Payable

The City is exposed to various risks of loss related to liability torts; theft of, damage to, and destruction of assets; errors and omissions; health and medical needs of employees; and natural disasters. The City established three internal service insurance funds (General Liability, Workers’ Compensation, and Employee Health Insurance funds) to account for and finance its self-insured risks of loss. Under the City’s risk management program, the City retains risk for each general liability claim, for each workers’ compensation claim (described under Risk Pools), and for each medical plan member under the health benefits program. The City purchases stop-lo ss coverage for the health benefits program over its $350,000 self-insured retention (SIR) from Union Labor Li fe Insurance Company up to a maximum of $1,000,000 per Original Plan member and $2,000,000 per Modified Plan member. The City’s coverage for SIR excess claims for general liability and workers’ compensation is discussed later in this note under risk pools. The workers’ compensation and health benefits programs are administered by third-party cl aims administrators. The general liability program is self- administered by the City.

The City’s estimated liabilities for claims filed or expected to be filed up to the amounts for which it retains risk in the Internal Service Funds is reported as Self-insurance claims and judgments.

Charges to the General Fund and other funds are determined from an analysis of claims costs and are recorded as expenditures or expenses in the contributing funds and char ges for services in the intern al service funds. Charges for general liability and workers’ compensation insurances are a percentage of payroll, and the charge for health benefits is a monthly dollar amount for all actively occupied positions.

Independent actuaries perform an analysis of the City’s poten tial liability for the City’s retained risk portions of the various self-insurance programs. The amounts recorded as liab ilities represent estimates of amounts to be paid for reported claims, as well as incurred but not reported claims based on experience, modified for current trends and information. For general liability and workers’ compensation for the current year, the present value of estimated outstanding losses is recognized at a 70% confidence level, using a 2.25% discount rate to reflect future investment earnings. While the ultimate amounts of losses incurred throug h June 30, 2022 are dependent on future developments, based on information provided by the City Attorney, outside counsel and others involved with the administration of the programs, the City’s management believes that the aggregate accrual is adequate to recognize such losses. There have been no significant reductions in any of the City’s insurance coverage each of the past three years.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

103
Note 13 – Claims Payable (Continued)

Changes in the balances of the City’s claims liabilities, which include incremental claims adjustments expenses, for the current and prior fiscal years, are as follows:

Risk Pools – The City is a member of two joint powers authorities organized under California Government Code for the purpose of pooling self-insured losses, as described below.

General Liability Insurance - In 1986, the City joined with other muni cipalities and regional municipal joint powers authorities to form the California Joint Powers Risk Ma nagement Authority (CJPRMA), a public entity risk pool currently operating as a general liability risk management a nd insurance program for 22 me mber entities. The City’s self-insured retention (SIR) is $1.25 million. Losses above the City’s SIR are pooled up to $7.5 million per occurrence, with reinsurance above the $7.5 million up to $40 million by CJPRMA. Specific coverage includes comprehensive and general automotive liability, personal injury, errors and omissions, and certain other coverage.

The CJPRMA governing board is comprised of a representa tive from each member entity. All members have a single vote for policy and charter changes. An executive committee of seven is elected to handle administration. Members are assessed annual contributions based on actuarially determined rates. CJPRMA retroactively adjusts premium deposits for any excess or deficiency in deposits related to paid claims and reserves. Financial statements for CJPRMA for the fiscal year ended June 30, 2022, can be obtained from CJPRMA at 3201 Doolan Road, Suite #285, Livermore, California 94551.

Property Protection - The City participates in CJPRMA’s All Risk s Property Protection Program, which is primarily underwritten by a casualty insurance company. The Program provides $400 million per occurrence in coverage to participating members, subject to a deductible of $250, 000. Premiums, which are negotiated each year, are based on property values and are not subject to retroactive adjustments.

Workers’ Compensation Insurance- The City has been self-funded for its Worker’s Compensation Program since 1979.

In July 2003, the City joined California Public Entity Insurance Authority (CPEIA), a public entity risk pool which operated an Excess Workers’ Compensation Program. CPEIA has since merged into an existing authority known as California State Association of Counties Excess Insuran ce Authorities (CSAC-EIA). The CSAC-EIA was formed in 1979 by 29 California counties for the purpose of pooling risk and providing a viable and cost-effective solution for the counties’ insurance and risk manageme nt needs. In 2020, the EIA became P ublic Risk Innovation, Solutions, and Management. PRISM has since expanded to allow admittan ce from cities and other entities which currently includes 95% of the counties in California, nearly 70% of the cities, as well as, numerous school districts, special districts, housing authorities, fire districts, and other Joint Powers Authorities. The City’s self-insured retention is currently set at $500,000 per occurrence. Losses above the City’s SIR are pooled up to $4.5 million per occurrence by PRISM. Statutory coverage for losses above $5 million is covered by reinsurance and excess insurance policies throughout PRISM.

General Workers’ Health
L iability Compensation Benefits Total
Balance, June 30, 2020 15,408,341$ 51,552,000$ 437,000$ 67,397,341$ Claims incurred (2,607,201) 11,650,192 3,651,216 12,694,207 Claims paid (2,276,514) (7,807,192) (3,692,216) (13,775,922) Balance, June 30, 2021 10,524,626 55,395,000 396,000 66,315,626 Claims incurred 5,939,446 1,649,686 2,410,879 10,000,011 Claims paid (959,839) (7,544,686) (2,410,879) (10,915,404) Balance, June 30, 2022 15,504,233$ 49,500,000$ 396,000$ 65,400,233$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

104
Note 14 – Pollution Remediation Obligations

GASB Statement No. 49 requires the former Agency, now Successor Agency, to report a pollution remediation liability upon the occurrence of an obligating event, such as being comp elled by a regulatory agency or legal action to clean up existing pollution. The liability is estim ated based on the expected future cash flows technique (i.e., the sum of the probability-weighted amounts in a range of possible estimat ed amounts). Only components of the liability (e.g., site assessment, site investigation, correc tive measures feasibility study, remediation design, remediati on operations and maintenance, and post-remediation monitoring) which can be reasonably estimated are included in the estimated liability.

Expected recoveries from insurers and other responsible parties reduce the estimated liability.

Actual pollution remediation costs may vary from the estimated liability for many reasons, including changes in pollution laws and regulations, the technology u sed for the cleanup, the remediation plan or operating conditions, prices of products and services.

The former Agency, now Successor Agen cy, has identified the UNOCAL site along the Stockton channel that are designated “Brownfields” by the U.S. Environmental Protection Agency, with the goal of revitalizing contaminated properties that the Successor Agency currently owns in the area near Stockton's downtown waterfront in the Waterfront Redevelopment Project Area. The following are details of the Successor Agency-owned contaminated site, including a description of the pollution, the obligating event requiring remediation action, estimable remediation costs components, and recoveries by responsible parties. Details of the liabilities as of June 30, 2022, are also discussed.

To provide clarification of the following discussion, th e California Polanco Redevelopment Act (AB 3193, Chapter 1113, Statutes of 1990, Polanco), part of the Community Redevelopment Act, was enacted by the California legislature to assist redevelopment agencies in responding to brownfield properties in their redevelopment areas. It prescribes processes for redevelopment agencies to follow when cleaning up a hazardous substance release in a redevelopment project area. It also provides immunity from liability for redevelopment agencies and subsequent property purchases for sites cleaned up under a cleanup plan approved by the California Department of Toxic Substances Control or a Regional Board.

The following provides a discussion of the identified brownfield sites of the Successor Agency:

Area 2A-Unocal – Soil and groundwater contamination has been identified in Area 2A-Unocal associated with total petroleum hydrocarbons, volatile and semi-volatile organic compounds. The obligating event for this site stems from a Polanco agreement notice issued to th e responsible party, currently in ne gotiation for settlement. Estimated costs are for a consultant, legal and City personnel costs for cleanup of the soil contamination, and pre-cleanup and investigative study of the site about the groundwater contamination. Future groundwater cleanup and ongoing post- remediation monitoring costs cannot be reasonably estimated . The net pollution remediation liability of this site as of June 30, 2022, is $431,250, which includes an estimated recovery of costs by the responsible party.

The total net estimated net pollution remediation liability for the site in the amount of $2 75,000, is reported to the Successor Agency as of June 30, 2022.

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

105
Note 15 – Individual Fund Disclosures

Deficit Fund Balances

At June 30, 2022, the following funds had net positions or fund balance deficits:

 The Parking Authority Fund has an accumulated deficit fund balance of $5,443,467 as of June 30, 2022. This is due to an interfund loan borrowing from the Worker’s Compensation Fund for $8,915,000. It is in relation to the payoff of the 2006 Series A ESB bonds previously held in the City’s Debt Service Fund. The loan terms are set at 2%, biannual payments with anticipated payoff date of February 1, 2032.

 The Successor Agency to the Redevelopment Agency Private Purpose Trust Fund has an accumulated deficit fund balance of $59,563,635 as of June 30, 2022. This is an Agency Private Purpose Trust fund and not included in the City’s net position. The fund has a bonds payable balance that causes the fund balance deficit.

Note 16 – Commitments and Contingencies

Contingent Liability – Pending Litigation

Various claims and legal actions are pending against the C ity, some of which have a reasonable possibility of an unfavorable outcome. These legal actions involve propert y, personal injury, and civil rights claims. GASB Statement No. 62 requires disclosure of pending litigation for which contingency is possible, and the amount cannot be reasonably estimated. As discussed in Note 13, the City is self-insured and has accrued a liability for estimated claims outstanding.

Amounts for the claims, which cannot be reasonably estimated at this time, have not been included in the financial statements. Management, after consultation with legal counsel, is of the opinion that ultimate disposition of these matters will not have a material adverse effect on the City’s financial position or results of operations.

Capital Commitments

The City is undertaking some capital improvement projects, the most significant of which include the following outstanding capital commitments at June 30, 2022:

Fund Fund Type Deficit
Parking Authority Enterprise Fund (5,443,467)$
Successor Agency Private Purpose Trust Fund (59,563,635) Amount
Waterfront Towers New City Hall 43,825,969$
McNair Library & Recreation Center 7,248,590
Regional Waste Water Control Facility 4,145,215
Developer Reimbursements 5,598,041
Stockton Soccer Complex Upgrade 2,651,751
Sierra Nevada Street Sewert Line Rehab 2,306,966
Left Turn Street Additions 1,779,616
67,556,148$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

106
Note 16 – Commitments and Contingencies (Continued)

Encumbrances

The City utilizes encumbrance accoun ting as a means of controlling expenditures. Under this method, funds are encumbered when purchase orders, contracts, and other commitments are signed or approved by authorized City officials. Such outstanding commitments at the end of the year do not constitute expenditures or liabilities under GAAP.

GASB Statement No. 54 provides additional guidance on the classification within the fund balances section of amounts that have been encumbered. Encumbrances of balances within the governmental funds are classified as either committed, restricted, or assigned and are included in the respective classification. Outstanding encumbrances at June 30, 2022, are as follows:

Facilities Management Agreement

On March 20, 2018, the Stockton City Council approve d the amendment of the current Facilities Management Agreement (Agreement) with SMG (now referred to as ASM) to include the Downtown Marina operations, extend the terms of the existing agreement and to include vendor performance benchmarks. ASM provides operation management and marketing services to the City for the Stockton. Ev ents Center includes a multi-purpose indoor arena, a baseball park, the Events Center common areas, the Bob Hope Theatre, Oak Park Ice Arena and the Downtown Marina.

The current agreement will extend the terms until 2026 and may be renewed at the option of the City for one additional five-year period. Either party may terminate the Agreemen t for cause during the agreement period due to a material breach by the other party or for default.

ASM is responsible for operating these facilities in keeping w ith the management goals set and approved each year by the City Council, with the overarching goal of having the facilities operating revenues ex ceed the respective operating expenses.

ASM is required to provide various fi delity and performance bonds, which includ es various types of coverage in the amount of $1,000,000. This coverage extends to th e areas of Commercial General and Automobile Liability, Professional Errors and Omissions, Crime, Employment and Worker’s Compensation. Additionally, there is an Umbrella Liability coverage requirement of $5,000,000.

Compensation to ASM is determined from a base fee for a ll venues, plus performance-based compensation, as defined in the Agreement. Both components are eligible for periodic adjustments based on the consumer price index (CPI).

Financial activities of ASM, as a service organization, is combined with and reported in the General Fund.

Amount
General Fund 7,319,267 $
Housing Grant Fund 1,410,888
Special Grant Fund 14,262,063
Capital Improvements 68,989,057
Other Governmental Funds 14,035,873
Total Governmental Funds 106,017,148$

ATTACHMENT A
City of Stockton
Notes to the Basic Financial Statements (Continued)
For the Year Ended June 30, 2022

107
Note 17 – Restricted Net Position

At June 30, 2022, restricted net position consisted of the following:

Note 18 – Subsequent Events

Issuance of Debt in Districts that have no commitment from City resources

Westlake Villages II CFD 2018-2 Improvement Area 2
On July 13, 2022, the City issued Special Tax Bonds, Series 2022, at a par amount of $9,775,000. The final payoff of the debt is September 1, 2052. Payment of the bonds are sole ly derived from special taxes on residential properties in the district and city funds are not pledged toward repayment of the bonds.

Cannery Park II CFD 2019-1
On August 24, 2022, the City issued Special Tax Bonds, Series 2022, at a par amount of $9,915,000. The final payoff of the debt is September 1, 2052. Payment of the bonds are solely derived from special taxes on residential properties in the district and city funds are not pledged toward repayment of the bonds.

Note 19 – Prior Period Adjustments

Governmental
Activities
Business -Type
Activities Totals
Restricted:

Capital projects 19,594,192 $ 11,098,030 $ 30,692,222 $ Debt service 1,953,877 14,295,981 16,249,858 Section 108 loan 1,277,452 - 1,277,452 Measure AB 9,177 - 9,177 Community development 51,214,185 - 51,214,185 General government 42,855,193 - 42,855,193 Housing 176,792,082 - 176,792,082 Library and arts 9,097,228 - 9,097,228 Parks and recreation 40,002,148 - 40,002,148 Public safety 20,332,643 - 20,332,643 Solid waste/recycling 5,994,885 - 5,994,885 Streets, transit and traffic 85,314,162 - 85,314,162 Pension 69,968,331 - 69,968,331 Total restricte d 524,405,555$ 25,394,011$ 549,799,566$ Fi du ci ary Fu n ds
Parking Successor
Authority Computer and Agency to the
Governmental Business-T ype Nonmajor Radio Internal Redevelopmenmt Activities Activities E nterprise Fund Service Fund Agency Net Position at July 1, 2021 927,005,110$ 636,664,973$ (5,579,757)$ 65,784,432$ (59,008,834)$ Correction of cash with fiscal agent - - - - (1,868,468) G AS B 87 Implementation 1,602,826 45,199 45,199 451,329 7,615 Net Position at July 1, 2021, as restated 928,607,936 636,710,172 (5,534,558) 66,235,761 (60,869,687)

ATTACHMENT A

108

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ATTACHMENT A

REQUIRED SUPPLEMENTARY INFORMATION

ATTACHMENT A

ATTACHMENT A
1 Budgetary Information
Budget Process
City of Stockton
Required Supplementary Information (Unaudited)
Notes to the Budgetary Comparison Schedule
For the Year Ended June 30, 2022
In accordance with the provisions of the City Charter, the City prepares and adopts a budget on or before June 30 for each fiscal year. Total appropriations shall not exceed the total of estimated revenues, estimated unencumbered balances of funds to be carried over from the preceding year and unencumbered available fund balances. The General Fund, HOME Programs Loans Special Revenue Fund, Low-Moderate Income Housing City Loans Special Revenue Fund and certain nonmajor special revenue funds (Solid Waste and Recycling, Gas Tax, Measure K Streets Sales Tax, Measure W Public Safety Sales Tax, Special Assessments, Development Services, and Other Special Revenue) and certain capital projects funds (Public Facilities Impact Fees and Capital Improvement) have legally adopted annual budgets. Prior to July 1, the original adopted budget is legally enacted through the passage of a resolution by the City Council. In the event this does not occur, the City Manager’s draft budget is in force until a bud
get is adopted by the City Council.

Enterprise and internal service funds are accounted for on a cost of service (net income) or capital maintenance measurement focus. The City is not legally mandated to report the results of operations for these fund types on a budgetary comparison basis; therefore, budgetary data related to these funds has not been presented.

If expenditures exceed appropriations at the department level for the General Fund or at the fund level for all other funds, the City Manager is authorized to transfer budgeted amounts between line items within any fund. During the year, the City Council approves supplemental appropriations and, by resolution, has also authorized the City Manager to transfer fund balances to applicable appropriation accounts, or to transfer between funds, when necessary to continue purposes approved by the City Council in the current year, adopted budget, or subsequent action. Amounts reported as final budget in the Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual – On a Budgetary Basis include amendments authorized throu
ghout the year.

Formal budgetary integration is employed as a management control device during the year for the General Fund and certain Special Revenue and Capital Projects Funds. Formal budgetary integration is not employed for the Debt Service Funds because effective budgetary control is alternately achieved through bond indenture provisions.

All unencumbered appropriations lapse at year-end, with the exception of ongoing capital improvement projects and miscellaneous
grants in the respective funds. Encumbered appropriations are re-appropriated in the following year’s budget. 109

ATTACHMENT A
1 Budgetary Information (Continued)
Budget Basis of Accounting
The write-off uncollectable accounts receivables is not recognized as an expenditure. Under GAAP, these write-offs are recognized as expenditures when the accounts receivables are determined to be uncollectable.

Certain funds of the City contain capital projects, grant projects, loan programs or other programs that are budgeted on a multi- year or project length basis. The amounts of the projects and programs budgeted on a multi-year basis are significant compared to the items budgeted on an annual basis; therefore, a comparison of budget to actual for the fund would not be meaningful. As a result, such funds are excluded from budgetary reporting.

The variations from GAAP that are for budgetary purposes include the following:

The City adopts budgets each fiscal year on a basis of accounting, which is different from accounting principles generally accepted in the United States of America
(GAAP).

The statements of revenue, expenditures and changes in fund balances have been prepared on the modified accrual basis of accounting in accordance with GAAP. The schedules of revenues, expenditures and changes in fund balances – budget and actual – on a bud
getary basis have been prepared on the budgetary basis, which is different from GAAP.

Outstanding commitments relating to construction contracts and other purchases of goods and services are recorded as expenditures at the time contracts or purchase agreements are entered into. Under GAAP, these obligations are recognized when goods are received or services are rendered.

City of Stockton
Required Supplementary Information (Unaudited)
Notes to the Budgetary Comparison Schedule (Continued)
For the Year Ended June 30, 2022
110

ATTACHMENT A
This page intentionally left blank.
111

ATTACHMENT A
Variance with
Original Final Actual Final Budget
REVENUES:

Taxes:

Property 38,416,000 $ 38,416,000 $ 41,066,425 $ 2,650,425 $ Utility user 34,342,000 34,342,000 38,328,240 3,986,240 Sales - levied by City 36,132,000 36,132,000 45,412,129 9,280,129 Franchise fees 16,595,630 16,595,630 17,925,299 1,329,669 Business license 9,695,000 9,695,000 14,024,356 4,329,356 Hotel/motel room 2,648,000 2,648,000 3,619,973 971,973 Document transfer 852,000 852,000 1,625,553 773,553 Other 2,614,939 2,614,939 4,015,502 1,400,563 Licenses and permits 577,014 577,014 510,976 (66,038) Intergovernmental:

Federal grants and subsidies 116,429 371,603 364,918 (6,685) Sales and use tax - levied by state 58,455,000 58,655,000 76,238,894 17,583,894 Other governmental 40,800,524 40,870,209 41,533,967 663,758 Charges for services 9,819,386 9,819,386 10,016,145 196,759 Fines and forfeitures 1,199,004 1,199,004 1,876,711 677,707 Use of money and property 7,107,097 7,107,097 8,301,161 1,194,064 Investment income:

Interest income 2,056,193 2,056,193 (6,752,234) (8,808,427) Refunds and reimbursements 220,945 220,945 219,469 (1,476) Miscellaneous 5,849,967 4,760,287 5,642,210 881,923 267,497,128 266,932,307 303,969,694 37,037,387 EXPENDITURES:

General government:

City council 1,005,703 1,200,397 972,115 228,282
City manager 2,624,622
2,696,909 2,422,165 274,744
City attorney 1,311,102 1,311,111 1,135,880 175,231
City clerk 1,101,024 1,101,840 964,914 136,926
City auditor 483,582 802,420 287,554 514,866
Administrative services 8,347,597 8,692,283 7,856,301 835,982 Human resources 2,352,349 3,720,342 2,204,210 1,516,132 Housing 10,051,116 4,881,236 2,547,334 2,333,902
Non-departmental 1,556,807 1,846,104 1,609,002 237,102
Total general government 28,833,902 26,252,642 19,999,475 6,253,167 Budget
City of Stockton
Required Supplementary Information (Unaudited)
For the Year Ended June 30, 2022
Budgetary Comparison Schedule - General Fund
112

ATTACHMENT A
Variance with
Original Final Actual Final Budget
EXPENDITURES (CONTINUED):

Public safety:

Police 145,869,718 146,858,341 132,234,605 14,623,736
Fire 54,464,468 55,763,440 52,264,392 3,499,048
Total public safety 200,334,186 202,621,781 184,498,997 18,122,784 Public works 17,498,458 18,931,959 17,336,248 1,595,711 Library 13,416,280 13,699,468 11,515,728 2,183,740 Parks and recreation 4,941,020 13,269,176 10,292,742 2,976,434 Capital outlay 451,049 1,274,091 468,869 805,222 Debt service:

Principal retirement - - 29,088 (29,088) Interest and fiscal charges - - 16,003 (16,003) Total expenditures 265,474,895 276,049,117 244,157,150 31,891,967

EXCESS (DEFICIENCY) OF REVENUES OVER
EXPENDITURES (BUDGETARY BASIS) 2,022,233 (9,116,810) 59,812,544 68,929,354 OTHER FINANCING SOURCES (USES):

Transfers out (11,036,175) (46,117,660) (12,235,569) 33,882,091 Proceed from issuance of debt - - 162,530 162,530 Proceed from sale of capital assets 22,000 22,000 16,769 (5,231) Total other financing sources (uses) (11,014,175) (46,095,660) (12,056,270) 34,039,390

NET CHANGE IN FUND BALANCE
(GAAP BASIS) (8,991,942)$ (55,212,470) $ 47,756,274 102,968,744 $ BASIS ADJUSTMENT:

Encumbrances (included in Final Budget above)* (7,319,267) NET CHANGE IN FUND BALANCE (BUDGETARY BASIS) 40,437,007 FUND BALANCE, BEGINNING OF YEAR 130,857,119
FUND BALANCE, END OF YEAR 171,294,126$
* Adjusted to Budgetary Basis.

The notes to the required supplementary information is an integral part of this schedule.

Budget
City of Stockton
Required Supplementary Information (Unaudited)
For the Year Ended June 30, 2022
Budgetary Comparison Schedule - General Fund (Continued) 113

ATTACHMENT A
Variance with
Original Final Actual Final Budget
REVENUES:

Intergovernmental:

Federal grants and subsidies 5,100,181 $ 12,572,402 $ 1,942,469 $ (10,629,933) $ Other governmental 1,994,047 1,994,047 1,994,047 - Charges for services - - 2,625 2,625 Use of money and property 235,000 235,000 1,249,320 1,014,320 Investment income:

Interest income (loss) - - (24,696) (24,696) Total revenues 7,329,228 14,801,449 5,163,765 (9,637,684) EXPENDITURES:

General government 7,114,647 16,368,740 2,504,918 13,863,822 Capital outlay - - - - Debt service:

Principal retirement 1,750,000 1,750,000 1,750,000 - Interest and fiscal charges 135,771 135,771 135,771 - Total expenditures 9,000,418 18,254,511 4,390,689 13,863,822

EXCESS (DEFICIENCY) OF REVENUES OVER
EXPENDITURES (GAAP BASIS) (1,671,190) (3,453,062) 773,076 4,226,138 OTHER FINANCING USES:

Transfers out (398,809) (398,809) (398,809) - Total other financing uses (398,809) (398,809) (398,809) - NET CHANGE IN FUND BALANCE (GAAP BASIS) (2,069,999)$ (3,851,871) $ 374,267 4,226,138 $ BASIS ADJUSTMENT:

Encumbrances (1,410,888)
NET CHANGE IN FUND BALANCE (BUDGETARY BASIS) (1,036,621) FUND BALANCE, BEGINNING OF YEAR 86,006,591
FUND BALANCE, END OF YEAR 84,969,970$
The notes to the required supplementary information is an integral part of this schedule.

Budget
For the Year Ended June 30, 2022
City of Stockton
Required Supplementary Information (Unaudited)
Budgetary Comparison Schedule - CDBG, NSP Housing Grants Special Revenue Fund 114

ATTACHMENT A
Variance with
Original Final Actual Final Budget
REVENUES:

Intergovernmental:

Federal grants and subsidies 78,344,451 $ 125,461,731 $ 72,680,699 $ (52,781,032) $ Other governmental 5,335,379 21,155,967 16,996,148 (4,159,819) Investment income:

Interest income (loss) - - (575,956) (575,956) Miscellaneous - 19,653 19,653 - Total revenues 83,679,830 146,637,351 89,120,544 (57,516,807) EXPENDITURES:

Current:

General government 83,285,802 117,953,933 41,098,830 76,855,103 Public safety 101,838 8,220,125 4,958,550 3,261,575 Public works - 502,148 76,737 425,411 Library - 2,426,216 575,571 1,850,645 Parks and recreation 30,000 482,402 30,732 451,670 Capital outlay - 18,140,822 6,675,212 11,465,610 Total expenditures 83,417,640 147,725,646 53,415,632 94,310,014

EXCESS (DEFICIENCY) OF REVENUES OVER
EXPENDITURES (BUDGETARY BASIS) 262,190 (1,088,295) 35,704,912 36,793,207 OTHER FINANCING USES:

Transfers out - (2,000,000) (1,500,000) 500,000 Total other financing uses - (2,000,000) (1,500,000) 500,000 NET CHANGE IN FUND BALANCE (GAAP BASIS) 262,190$ (3,088,295) $ 34,204,912 37,293,207 $ BASIS ADJUSTMENT:

Encumbrances (14,262,063)
NET CHANGE IN FUND BALANCE (BUDGETARY BASIS) 19,942,849 FUND BALANCE, BEGINNING OF YEAR 2,597,910
FUND BALANCE, END OF YEAR 22,540,759$
The notes to the required supplementary information is an integral part of this schedule.

Budget
City of Stockton
Required Supplementary Information (Unaudited)
For the Year Ended June 30, 2022
Budgetary Comparison Schedule - Special Grants Special Revenue Fund 115

ATTACHMENT A
Measurement period 2013-141 2014-15 2015-16 2016-17 2017-18 Total pension liability
Service cost 9,440,824 $ 9,145,587 $ 9,240,648 $ 10,871,947 $ 11,500,131 $ Interest 46,152,921 47,148,768 48,179,529 48,291,460 48,873,856 Changes of benefit terms - - - - - Changes of assumptions - (11,281,319) - 39,356,599 (19,696,405) Differences between expected
and actual experience - (10,000,256) (8,961,502) (17,662,863) 3,486,532 Benefit payments, including
refunds of employee contributions (32,763,729) (33,662,380) (34,150,397) (34,494,172) (35,750,319) Net change in total pension liability 22,830,016 1,350,400 14,308,278 46,362,971 8,413,795 Total pension liability - beginning 627,033,727 649,863,743 651,214,143 665,522,421 711,885,392 Total pension liability - ending (a) 649,863,743$ 651,214,143 $ 665,522,421 $ 711,885,392 $ 720,299,187 $ Pension fiduciary net position
Contributions - employer 9,402,881 $ 10,783,518 $ 13,879,482 $ 13,189,681 $ 15,252,226 $ Contributions - employee 3,761,959 3,802,226 3,971,944 4,386,770 4,729,377 Net investment income 79,512,728 11,522,882 2,491,249 56,250,959 45,626,430 Benefit payments, including
refunds of employee contributions (32,763,729) (33,662,380) (34,150,397) (34,494,172) (35,750,319) Net plan to plan resource movement - (13,377) 933 - 4,111 Administrative expense - (599,978) (315,359) (743,130) (844,458) Other miscellaneous income/ (expense)
2 - - - - (1,603,640) Net change in plan fiduciary net position 59,913,839 (8,167,109) (14,122,148) 38,590,108 27,413,727 Plan fiduciary net position - beginning3 465,703,750 525,617,589 517,450,480 503,328,332 541,918,440 Plan fiduciary net position - ending (b) 525,617,589$ 517,450,480 $ 503,328,332 $ 541,918,440 $ 569,332,167 $ Plan net pension liability - ending (a) - (b) 124,246,154$ 133,763,663 $ 162,194,089 $ 169,966,952 $ 150,967,020 $ Plan fiduciary net position as a percentage
of the total pension liability 80.88% 79.46% 75.63% 76.12% 79.04% Covered payroll4
52,603,907$ 53,997,677 $ 56,400,439 $ 61,357,565 $ 67,079,626 $ Plan net pension liability as a percentage
of covered payroll 236.19% 247.72% 287.58% 277.01% 225.06% Notes to Schedule:
2 During Fiscal Year 2017-18, as a result of Governmental Accounting Standards Board Statement (GASB) No. 75, Accounting and Financial Reporting for Postemployment Benefit Plans Other than Pensions (GASB 75), CalPERS reported its proportionate share of activity related to postemployment benefits for participation in the State of California’s agent OPEB plan. Accordingly, CalPERS recorded a one-time expense as a result of the adoption of GASB 75. Additionally, CalPERS employees participate in various State of California agent pension plans and during Fiscal Year 2017-18, CalPERS recorded a correction to previously reported financial statements to properly reflect its proportionate share of activity related to pensions in accordance with GASB Statement No. 68, Accounting and Financial Reporting for Pensions (GASB 68). 3 Includes any beginning of year adjustment.
4Includes one year's payroll growth using 2.75% payroll growth assumption for fiscal years ended June 30, 2018-21; 3.00% payroll growth assumption for fiscal year ended June 30, 2014 -17.

Changes of Assumptions: None in 2019 -2021. In 2018, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study and Review of Assumptions December 2017. There were no changes in the discount rate. In 2017, the discount rate was reduced from 7.65 percent to 7.15 percent. In 2016, there were no changes. In 2015, amounts reported reflect an adjustment of the discount rate from 7.5 percent (net of administrative expense) to 7.65 percent (without a reduction for pension plan administrative expense). In 2014, amounts reported were based on the 7.5 percent discount rate.

Benefit Changes: The figures above do not include any liability impact that may have resulted from plan changes which occurred after the June 30, 2018 valuation date. This applies for voluntary benefit changes as well as any offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes). 1 Historical information is presented only for measurement periods for periods after GASB 68 implementation in 2013-14. Additional years of information will be displayed as it becomes available.

California Public Employees' Retirement System ("CalPERS") - Miscellaneous Plan Last Ten Fiscal Years
City of Stockton
Required Supplementary Information (Unaudited)
Schedule of Changes in Net Pension Liability and Related Ratios For the Year Ended June 30, 2022
116

ATTACHMENT A
Measurement period 2018-19 2019-2020 2020-2021
Total pension liability
Service cost 11,446,572$ 11,098,178$ 11,194,084$ Interest 50,718,177 51,801,795 53,055,641 Changes of benefit terms - - - Changes of assumptions - - - Differences between expected
and actual experience 2,061,288 (8,567,800) (5,435,616) Benefit payments, including
refunds of employee contributions (37,477,251) (39,057,265) (40,894,732) Net change in total pension liability 26,748,786 15,274,908 17,919,377 Total pension liability - beginning 720,299,187 747,047,973 762,322,881 Total pension liability - ending (a) 747,047,973$ 762,322,881 $ 780,242,258 $ Pension fiduciary net position
Contributions - employer 17,112,542 $ 19,204,043 $ 20,363,651 $ Contributions - employee 4,540,503 4,721,760 4,939,316 Net investment income 37,027,715 29,185,528 135,230,666 Benefit payments, including
refunds of employee contributions (37,477,251) (39,057,265) (40,894,732) Net plan to plan resource movement - - - Administrative expense (406,288) (831,939) (602,713) Other miscellaneous income/ (expense)
2 1,325 - -
Net change in plan fiduciary net position 20,798,546 13,222,127 119,036,188 Plan fiduciary net position - beginning3 569,332,167 590,130,713 603,352,840 Plan fiduciary net position - ending (b) 590,130,713$ 603,352,840 $ 722,389,028 $ Plan net pension liability - ending (a) - (b) 156,917,260$ 158,970,041 $ 57,853,230 $ Plan fiduciary net position as a percentage
of the total pension liability 79.00% 79.15% 92.59%
Covered payroll4
67,851,642$ 67,099,018 $ 69,099,285 $
Plan net pension liability as a percentage
of covered payroll 231.27% 236.92% 83.72%
Last Ten Fiscal Years
California Public Employees' Retirement System ("CalPERS") - Miscellaneous Plan (Continued) City of Stockton
Required Supplementary Information (Unaudited)
Schedule of Changes in Net Pension Liability and Related Ratios (Continued) For the Year Ended June 30, 2022
117

ATTACHMENT A
Measurement period 2013-141 2014-15 2015-16 2016-17 2017-18 Total pension liability
Service cost 13,907,523 $ 13,593,233 $ 13,548,998 $ 15,401,471 $ 17,684,602 $ Interest 65,730,714 67,693,599 69,765,169 71,053,021 75,078,142 Changes of benefit terms - - - - - Changes of assumptions - (16,908,140) - 59,494,381 (3,852,172) Differences between expected
and actual experience - (5,410,590) (3,570,311) (9,538,805) 26,895,156 Benefit payments, including
refunds of employee contributions (47,761,534) (49,614,935) (51,615,173) (53,205,686) (55,481,650) Net change in total pension liability 31,876,703 9,353,167 28,128,683 83,204,382 60,324,078 Total pension liability - beginning 893,336,527 925,213,230 934,566,397 962,695,080 1,045,899,462 Total pension liability - ending (a) 925,213,230$ 934,566,397 $ 962,695,080 $ 1,045,899,462 $ 1,106,223,540 $ Pension fiduciary net position
Contributions - employer 13,818,051 $ 17,178,961 $ 20,338,253 $ 23,342,334 $ 26,124,666 $ Contributions - employee 6,449,394 5,896,729 5,940,342 6,617,527 6,942,272 Net investment income 105,163,288 15,155,169 3,348,803 73,783,913 59,476,319 Benefit payments, including
refunds of employee contributions (47,761,534) (49,614,935) (51,615,173) (53,205,686) (55,481,650) Net plan to plan resource movement - 3,305 - - (7,168) Administrative expense - (771,300) (416,243) (975,302) (1,106,599) Other miscellaneous income/ (expense)
2 - - - - (2,101,449) Net change in plan fiduciary net position 77,669,199 (12,152,071) (22,404,018) 49,562,786 33,846,391 Plan fiduciary net position - beginning3 617,467,219 695,136,418 682,984,347 660,580,329 710,143,115 Plan fiduciary net position - ending (b) 695,136,418$ 682,984,347 $ 660,580,329 $ 710,143,115 $ 743,989,506 $ Plan net pension liability - ending (a) - (b) 230,076,812$ 251,582,050 $ 302,114,751 $ 335,756,347 $ 362,234,034 $ Plan fiduciary net position as a percentage
of the total pension liability 75.13% 73.08% 68.62% 67.90% 67.25% Covered payroll4
45,422,701$ 46,710,538 $ 47,115,477 $ 48,429,252 $ 56,947,904 $ Plan net pension liability as a percentage
of covered payroll 506.52% 538.60% 641.22% 693.29% 636.08% Notes to Schedule:

Changes of Assumptions: None in 2019 -2021. In 2018, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study and Review of Assumptions December 2017. There were no changes in the discount rate. In 2017, the discount rate was 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 re
ported were based on the 7.5 percent discount rate.

For the Year Ended June 30, 2022
California Public Employees' Retirement System ("CalPERS") - Safety Plan 1 Historical information is presented only for measurement periods for periods after GASB 68 implementation in 2013-14. Additional years of information will be displayed as it becomes available.
2 During Fiscal Year 2017-18, as a result of Governmental Accounting Standards Board Statement (GASB) No. 75, Accounting and Financial Reporting for Postemployment Benefit Plans Other than Pensions (GASB 75), CalPERS reported its proportionate share of activity related to postemployment benefits for participation in the State of California’s agent OPEB plan. Accordingly, CalPERS recorded a one-time expense as a result of the adoption of GASB 75. Additionally, CalPERS employees participate in various State of California agent pension plans and during Fiscal Year 2017-18, CalPERS recorded a correction to previously reported financial statements to properly reflect its proportionate share of activity related to pensions in accordance with GASB Statement No. 68, Accounting and Financial Reporting for Pensions (GASB 68). 3 Includes any beginning of year adjustment.
4Includes one year's payroll growth using 2.75% payroll growth assumption for fiscal years ended June 30, 2018-21; 3.00% payroll growth assumption for fiscal year ended June 30, 2014 -17.

Benefit Changes: The figures above do not include any liability impact that may have resulted from plan changes which occurred after the June 30, 2018 valuation date. This applies for voluntary benefit changes as well as any offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes).

Last Ten Fiscal Years
City of Stockton
Required Supplementary Information (Unaudited)
Schedule of Changes in Net Pension Liability and Related Ratios 118

ATTACHMENT A
Measurement period 2018-19 2019-2020 2020-2021
Total pension liability
Service cost 18,340,749$ 18,438,776$ 17,442,651$ Interest 77,850,318 79,970,381 82,106,386 Changes of benefit terms - - - Changes of assumptions - - - Differences between expected
and actual experience 2,178,151 (7,219,787) (5,649,159) Benefit payments, including
refunds of employee contributions (57,512,870) (61,225,237) (63,550,272) Net change in total pension liability 40,856,348 29,964,133 30,349,606 Total pension liability - beginning 1,106,223,540 1,147,079,888 1,177,044,021 Total pension liability - ending (a) 1,147,079,888$ 1,177,044,021 $ 1,207,393,627 $ Pension fiduciary net position
Contributions - employer 29,781,351 $ 33,596,802 $ 37,208,895 $ Contributions - employee 7,139,569 7,347,966 7,775,415 Net investment income 48,529,461 38,307,390 177,671,066 Benefit payments, including
refunds of employee contributions (57,512,870) (61,225,237) (63,550,272) Net plan to plan resource movement - - - Administrative expense (530,927) (1,087,482) (787,501) Other miscellaneous income/ (expense)
2 1,732 - -
Net change in plan fiduciary net position 27,408,316 16,939,439 158,317,603 Plan fiduciary net position - beginning3 743,989,506 771,397,822 788,337,261 Plan fiduciary net position - ending (b) 771,397,822$ 788,337,261 $ 946,654,864 $ Plan net pension liability - ending (a) - (b) 375,682,066$ 388,706,760 $ 260,738,763 $ Plan fiduciary net position as a percentage
of the total pension liability 67.25% 66.98% 78.40%
Covered payroll4
59,708,789$ 60,894,239 $ 58,297,630 $
Plan net pension liability as a percentage
of covered payroll 629.19% 638.33% 447.25%
For the Year Ended June 30, 2022
Last Ten Fiscal Years
California Public Employees' Retirement System ("CalPERS") - Safety Plan (Continued) City of Stockton
Required Supplementary Information (Unaudited)
Schedule of Changes in Net Pension Liability and Related Ratios (Continued) 119

ATTACHMENT A
Measurement period 2014-151 2015-16 2016-17 2017-18 2018-19 Total pension liability
Service cost 145,882 $ 150,623 $ 134,056 $ 138,078 $ 151,504 $ Interest 650,386 680,023 701,117 730,559 706,545 Changes of benefit terms - - - - - Changes of assumptions - - - - 605,028 Economic/demographic gains or losses - - (110,133) - (156,665) Benefit payments, including
refunds of employee contributions (358,380) (397,530) (407,870) (429,654) (467,860) Net change in total pension liability 437,888 433,116 317,170 438,983 838,552 Total pension liability - beginning 9,321,510 9,759,398 10,192,514 10,509,684 10,948,667 Total pension liability - ending (a) 9,759,398$ 10,192,514 $ 10,509,684 $ 10,948,667 $ 11,787,219 $ Pension fiduciary net position
Contributions - employer 751,157 $ 705,192 $ 528,894 $ 941,620 $ 753,296 $ Contributions - employee - - - - - Net investment income 124,454 8,851 596,724 409,596 482,222 Benefit payments, including
refunds of employee contributions (358,380) (397,530) (407,870) (429,654) (467,860) Net plan to plan resource movement - - - - - Administrative expense (966) (43,490) (13,097) (13,992) (14,506) Net change in plan fiduciary net position 516,265 273,023 704,651 907,570 753,152 Plan fiduciary net position - beginning 5,058,426 5,574,691 5,847,714 6,552,365 7,459,935 Plan fiduciar
y net position - ending (b) 5,574,691$ 5,847,714 $ 6,552,365 $ 7,459,935 $ 8,213,087 $ Plan net pension liability - ending (a) - (b) 4,184,707$ 4,344,800 $ 3,957,319 $ 3,488,732 $ 3,574,132 $ Plan fiduciary net position as a percentage
of the total pension liability 57.12% 57.37% 62.35% 68.14% 69.68% Covered payroll4
3,610,315$ 3,454,139 $ 3,327,608 $ 3,427,436 $ 3,446,204 $ Plan net pension liability as a percentage
of covered payroll 115.91% 125.79% 118.92% 101.79% 103.71% 1 Historical information is presented only for measurement periods for periods after the PARS plan set up in 2014-15. Additional years of information will be displayed as it becomes available.

For the Year Ended June 30, 2022
PARS Enhancement Plan
Last Ten Fiscal Years
City of Stockton
Required Supplementary Information (Unaudited)
Schedule of Changes in Net Pension Liability and Related Ratios 120

ATTACHMENT A
Measurement period 2019-2020 2020-2021 2021-2022
Total pension liability
Service cost 155,670$ 132,117$ 135,750$ Interest 759,727 781,943 809,517 Changes of benefit terms - - - Changes of assumptions - - - Economic/demographic gains or losses - 120,626 - Benefit payments, including
refunds of employee contributions (517,711) (583,450) (645,746) Net change in total pension liability 397,686 451,236 299,521 Total pension liability - beginning 11,787,219 12,184,905 12,636,141 Total pension liability - ending (a) 12,184,905$ 12,636,141 $ 12,935,662 $ Pension fiduciary net position
Contributions - employer 803,170 $ 602,378 $ 1,055,182 $ Contributions - employee - - - Net investment income 272,545 1,923,213 (1,452,185) Benefit payments, including
refunds of employee contributions (517,711) (583,450) (645,746) Net plan to plan resource movement - - - Administrative expense (15,254) (16,676) (17,644) Net change in plan fiduciary net position 542,750 1,925,465 (1,060,393) Plan fiduciar
y net position - beginning3 8,213,087 8,755,837 10,681,302 Plan fiduciary net position - ending (b) 8,755,837$ 10,681,302 $ 9,620,909 $ Plan net pension liability - ending (a) - (b) 3,429,068$ 1,954,839 $ 3,314,753 $ Plan fiduciary net position as a percentage
of the total pension liability 71.86% 84.53% 74.38%
Covered payroll4
2,784,812$ 2,966,110 $ 2,403,153 $
Plan net pension liability as a percentage
of covered payroll 123.13% 65.91% 137.93%
For the Year Ended June 30, 2022
Last Ten Fiscal Years
PARS Enhancement Plan (Continued)
City of Stockton
Required Supplementary Information (Unaudited)
Schedule of Changes in Net Pension Liability and Related Ratios (Continued) 121

ATTACHMENT A
2013-141 2014-15 2015-16 2016-17 2017-18
Actuarially determined contribution 9,402,881 $ 10,783,518 $ 12,545,482 $ 13,189,681 $ 15,252,226 $ Contributions in relation to
the actuarially determined contribution2 (9,402,881) (10,783,518) (13,879,482) (13,189,681) (15,252,226) Contribution deficiency (excess) -$ -$ (1,334,000)$ -$ -$ Covered payroll3
52,603,907$ 53,997,677 $ 56,400,439 $ 61,357,565 $ 67,079,626 $ Contributions as a percentage of
covered payroll3 17.87% 19.97% 24.61% 21.50% 22.74%
Notes to Schedule:

Methods and assumptions used to determine contribution rates:

Actuarial Cost Method Entry Age Normal
Amortization Method/Period For details, see June 30, 2018 Funding Valuation Report.

Asset Valuation Method Fair Value of Assets. For details, see June 30, 2018 Funding Valuation Report.

Inflation 2.50%
Salary Increases Varies by entry age and service
Payroll Growth 2.75%
Investment Rate of Return 7.00% Net of Pension Plan Investment and Administrative Expenses; includes Inflation.

Retirement age
Mortality
The probabilities of Retirement are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015.

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% of Scale MP-2016 published by the Society of Actuaries.

The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2020-21 were derived from the June 30, 2018 funding valuation report.

For the Year Ended June 30, 2022
California Public Employees' Retirement System ("CalPERS") - Miscellaneous Plan 1 Historical information is presented only for measurement periods for periods after GASB 68 implementation in 2013-14. Additional years of information will be displayed as it becomes available.
2 Employers are assumed to make contributions equal to the actuarially determined contributions. However, some employers may choose to make additional contributions towards their unfunded liability. Employer contributions for such plans exceed the actuarially determined contributions. 3 Includes one year’s payroll growth using 2.75% payroll growth assumption for fiscal years ended June 30, 2018-21; 3.00% payroll growth assumption for fiscal years ended June 30, 2014-17.

Last Ten Fiscal Years
City of Stockton
Required Supplementary Information (Unaudited)
Schedule of Contributions - Pensions
122

ATTACHMENT A
2018-19 2019-2020 2020-2021 2021-2022
Actuarially determined contribution 17,112,542$ 19,204,043$ 20,363,651$ 20,497,511$ Contributions in relation to
the actuarially determined contribution2 (17,112,542) (19,204,043) (20,363,651) (20,497,511) Contribution deficiency (excess) -$ -$ -$ -$ Covered payroll3
67,851,642$ 67,099,018 $ 69,099,285 $ 70,999,515 $ Contributions as a percentage of
covered payroll3 25.22% 28.62% 29.47% 28.87%
Notes to Schedule:

Methods and assumptions used to determine contribution rates:

Actuarial Cost Method Entry Age Normal
Amortization Method/Period For details, see June 30, 2018 Funding Valuation Report.

Asset Valuation Method Fair Value of Assets. For details, see June 30, 2018 Funding Valuation Report.

Inflation 2.50%
Salary Increases Varies by entry age and service
Payroll Growth 2.75%
Investment Rate of Return 7.00% Net of Pension Plan Investment and Administrative Expenses; includes Inflation.

Retirement age
Mortality
The probabilities of Retirement are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015.

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% of Scale MP-2016 published by the Society of Actuaries.

For the Year Ended June 30, 2022
Last Ten Fiscal Years
California Public Employees' Retirement System ("CalPERS") - Miscellaneous Plan (Continued) The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2020-21 were derived from the June 30, 2018 funding valuation report.
1 Historical information is presented only for measurement periods for periods after GASB 68 implementation in 2013-14. Additional years of information will be displayed as it becomes available.
2 Employers are assumed to make contributions equal to the actuarially determined contributions. However, some employers may choose to make additional contributions towards their unfunded liability. Employer contributions for such plans exceed the actuarially determined contributions. 3 Includes one year’s payroll growth using 2.75% payroll growth assumption for fiscal years ended June 30, 2018-21; 3.00% payroll growth assumption for fiscal years ended June 30, 2014-17.

City of Stockton
Required Supplementary Information (Unaudited)
Schedule of Contributions - Pensions (Continued)
123

ATTACHMENT A
2013-141 2014-15 2015-16 2016-17 2017-18
Actuarially determined contribution 13,818,051 $ 17,178,961 $ 20,338,253 $ 23,342,334 $ 26,124,666 $ Contributions in relation to
the actuarially determined contribution2 (13,818,051) (17,178,961) (20,338,253) (23,342,334) (26,124,666) Contribution deficiency (excess) -$ -$ -$ -$ -$ Covered payroll3
45,422,701$ 46,710,538 $ 47,115,477 $ 48,429,252 $ 56,947,904 $ Contributions as a percentage of
covered payroll3 30.42% 36.78% 43.17% 48.20% 45.87%
Notes to Schedule:

Methods and assumptions used to determine contribution rates:

Actuarial Cost Method Entry Age Normal
Amortization Method/Period For details, see June 30, 2018 Funding Valuation Report.

Asset Valuation Method Fair Value of Assets. For details, see June 30, 2018 Funding Valuation Report.

Inflation 2.50%
Salary Increases Varies by entry age and service
Payroll Growth 2.75%
Investment Rate of Return 7.00% Net of Pension Plan Investment and Administrative Expenses; includes Inflation.

Retirement age
Mortality
City of Stockton
Required Supplementary Information (Unaudited)
Schedule of Contributions - Pensions
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% of Scale MP-2016 published by the Society of Actuaries.

For the Year Ended June 30, 2022
California Public Employees' Retirement System ("CalPERS") - Safety Plan The probabilities of Retirement are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015.

Last Ten Fiscal Years
1 Historical information is presented only for measurement periods for periods after GASB 68 implementation in 2013-14. Additional years of information will be displayed as it becomes available.
2 Employers are assumed to make contributions equal to the actuarially determined contributions. However, some employers may choose to make additional contributions towards their unfunded liability. Employer contributions for such plans exceed the actuarially determined contributions. 3 Includes one year’s payroll growth using 2.75% payroll growth assumption for fiscal years ended June 30, 2018-21; 3.00% payroll growth assumption for fiscal years ended June 30, 2014-17.

The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2020-21 were derived from the June 30, 2018 funding valuation report.
124

ATTACHMENT A
2018-19 2019-2020 2020-2021 2021-2022
Actuarially determined contribution 29,781,351 $ 33,596,802 $ 37,208,895 $ 39,176,629 $ Contributions in relation to
the actuarially determined contribution2 (29,781,351) (33,596,802) (37,208,895) (39,176,629) Contribution deficiency (excess) -$ -$ -$ -$ Covered payroll3
59,708,789$ 60,894,239 $ 58,297,630 $ 59,900,815 $ Contributions as a percentage of
covered payroll3 49.88% 55.17% 63.83% 65.40%
Notes to Schedule:

Methods and assumptions used to determine contribution rates:

Actuarial Cost Method Entry Age Normal
Amortization Method/Period For details, see June 30, 2018 Funding Valuation Report.

Asset Valuation Method Fair Value of Assets. For details, see June 30, 2018 Funding Valuation Report.

Inflation 2.50%
Salary Increases Varies by entry age and service
Payroll Growth 2.75%
Investment Rate of Return 7.00% Net of Pension Plan Investment and Administrative Expenses; includes Inflation.

Retirement age
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% of Scale MP-2016 published by the Society of Actuaries.

City of Stockton
Required Supplementary Information (Unaudited)
Schedule of Contributions - Pensions (Continued)
For the Year Ended June 30, 2022
Last Ten Fiscal Years
The probabilities of Retirement are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015.

California Public Employees' Retirement System ("CalPERS") - Safety Plan (Continued) 1 Historical information is presented only for measurement periods for periods after GASB 68 implementation in 2013-14. Additional years of information will be displayed as it becomes available.
2 Employers are assumed to make contributions equal to the actuarially determined contributions. However, some employers may choose to make additional contributions towards their unfunded liability. Employer contributions for such plans exceed the actuarially determined contributions. 3 Includes one year’s payroll growth using 2.75% payroll growth assumption for fiscal years ended June 30, 2018-21; 3.00% payroll growth assumption for fiscal years ended June 30, 2014-17.

The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2020-21 were derived from the June 30, 2018 funding valuation report.
125

ATTACHMENT A
2013-141 2014-15 2015-16 2016-17 2017-18
Actuarially determined contribution 766,478 $ 700,451 $ 705,192 $ 705,192 $ 753,296 $ Contributions in relation to
the actuarially determined contribution2 (1,134,701) (751,157) (705,192) (528,894) (941,620) Contribution deficiency (excess) (368,223)$ (50,706)$ -$ 176,298$ (188,324)$ Covered payroll3
3,496,673$ 3,610,315 $ 3,454,139 $ 3,327,608 $ 3,427,436 $ Contributions as a percentage
of covered payroll3 32.45% 20.81% 20.42% 15.89% 27.47%
Notes to Schedule:

Methods and assumptions used to determine contribution rates:

Actuarial Cost Method Entry Age Normal
Amortization Method/Period Level dollar, closed, 7.67 years Asset Valuation Method Fair Value of Assets. For details, see June 30, 2018 Funding Valuation Report.

Inflation 2.50%
Salary Increases
Payroll Growth 2.75%
Investment Rate of Return 6.50%
Cost of Living Adjustments 2.00%
Withdrawal/Disability
1 Historical information is presented only for measurement periods for periods after GASB 68 implementation in 2013-14. Additional years of information will be displayed as it becomes available.

The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2021-22 were derived from the June 30, 2022 funding valuation report.

Consistent with the rates used to value CalPERS Miscellaneous Public Agency Pension Plans after June 30, 2017.

Consistent with the rates used to value Miscellaneous Public Agency CalPERS Pension Plans for an employee with an entry age of 30.

For the Year Ended June 30, 2022
Last Ten Fiscal Years
PARS Enhancement Plan
City of Stockton
Required Supplementary Information (Unaudited)
Schedule of Contributions - Pensions
126

ATTACHMENT A
2018-19 2019-2020 2020-2021 2021-2022
Actuarially determined contribution 753,296 $ 803,170 $ 803,170 $ 854,389 $ Contributions in relation to
the actuarially determined contribution2 (753,296) (803,170) (602,378) (1,055,182) Contribution deficiency (excess) - $ - $ 200,792$ (200,793) $ Covered payroll3
3,446,204$ 2,784,812 $ 2,966,110 $ 2,403,153 $ Contributions as a percentage
of covered payroll3 21.86% 28.84% 20.31% 43.91%
Notes to Schedule:

Methods and assumptions used to determine contribution rates:

Actuarial Cost Method Entry Age Normal
Amortization Method/Period Level dollar, closed, 7.67 years Asset Valuation Method Fair Value of Assets. For details, see June 30, 2018 Funding Valuation Report.

Inflation 2.50%
Salary Increases
Payroll Growth 2.75%
Investment Rate of Return 6.50%
Cost of Living Adjustments 2.00%
Withdrawal/Disability
1 Historical information is presented only for measurement periods for periods after GASB 68 implementation in 2013-14. Additional years of information will be displayed as it becomes available.

The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2021-22 were derived from the June 30, 2022 funding valuation report.

Consistent with the rates used to value CalPERS Miscellaneous Public Agency Pension Plans after June 30, 2017.

Consistent with the rates used to value Miscellaneous Public Agency CalPERS Pension Plans for an employee with an entry age of 30.

For the Year Ended June 30, 2022
Last Ten Fiscal Years
PARS Enhancement Plan (Continued)
City of Stockton
Required Supplementary Information (Unaudited)
Schedule of Contributions - Pensions (Continued)
127

ATTACHMENT A
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128

ATTACHMENT A

NONMAJOR GOVERNMENTAL FUNDS

ATTACHMENT A

ATTACHMENT A

SPECIAL REVENUE FUNDS
The City’s nonmajor governmental special revenue funds include:

State Housing Grants Fund
Solid Waste and Recycling Fund
Gas Tax Fund
Measure K Streets Sales Tax Fund
Measure M Strong Communities Initiative
Measure W Public Safety Tax Fund
Special Assessment Fund
To accoun t for revenues and expenditures apportioned to the Cit y from ½ cen t sales tax collections unde r Measure K. The Measure K program is administered by the San Joaquin Council of Governments (“SJCOG”) as the Local Transportation Authority for San Joaquin County. SJCOG was established as the Local Transportation Authority for this measure when San Joaquin County voters approved the enactment of the Measure K program in 1990. In 2006, voters approved to extend this measure for an additional 30 years. Expenditures for administration, maintenance and construction received under Measure K must be for street and transportation related projects.

Measure W is a one-quarte
r (1/4) cen t transaction an d use sales tax whic h was approved by voters i n November 2004.

Expenditures are for administration, implementation, and operation of the Police and Fire Safe Neighborhood Gang and Drug Prevention Program, among other programs.

To account for revenues and expenditures related to levies on property owners as approved by the City Council and state laws for special types of services – basic street and neighborhood lighting, land and streetscapes, and stormwater drainage maintenance services.

Measure M implements a dedicated one-quarter (1/4) cent special transactions and use sales tax for a period of 16 years fo r the provision of library and recreation services. On May 24, 2016, the Stockton City Council approved placing a one-quarter (1/4) cent sales tax on the November 8, 2016, General Election ballot with a Council vote of 7 - 0 and adopted Resolution 2016-05-24 - 1602. Minor amendments were made to define the incorporated area of the City of Stockton, the election date, and to correct the name of a state board that had changed, based on comments received from the California State Board of Equalization, and the Resolution was superseded by Resolution 2016-06-07-1212 on June 7, 2016.

NONMAJOR GOVERNMENTAL FUNDS
Special revenue funds are used to account for specific governmental revenue sources that are restricted, committed or assigned to expenditures for specified purposes other than debt service or capital projects.

To accoun
t for resources for the City’s CalHome State Loan Program that support homeownership programs aimed at very low income households and loans extended to eligible low and moderate-income families as approved by the former Stockton Redevelopment Agency and the California Health and Safety Code. This fund includes the City’s annual funding for single family, down-payment assistance and single family rehabilitation from State funding sources.

To accoun
t for the administratio n of solid waste collection services, an d the planning an d implementation of solid waste reduction and recycling programs, in compliance with California Public Resources Code Section 40050 through 40063 (AB 939).

To account for revenues and expenditures apportioned to the City under the California Streets and Highway Code, sections 2103 through 2107.5. Expenditures of these resources for administration, maintenance and construction must be street and transportation related.
129

ATTACHMENT A

SPECIAL REVENUE FUNDS (CONTINUED)
Development Services Fund
Other Special Revenue Fund
Transportation Development Act Fund

CAPITAL PROJECT FUNDS
The City’s nonmajor governmental capital project funds include:

Public Facilities Impact Fees Capital Projects Fund

DEBT SERVICE FUNDS
The City’s nonmajor governmental debt service funds include:

Stockton Public Financing Authority Debt Service Fund

PERMANENT FUND
The Permanent Fund reports resources that are legally restricted to the extent that only earnings, and not principal, can be spent.

Permanent Fund resources help support designated arts, recreation, library and public safety programs.

Capital Project Funds are used to account for the acquisition and construction of major capital facilities other than those financed by proprietary funds.

NONMAJOR GOVERNMENTAL FUNDS (CONTINUED)
Debt Service Funds are used to account for and report financial resources that are restricted committed, or assigned to expenditures for principal and interest on long-term debt.

To accoun
t for the resources of comparatively smaller special revenue funds, including the Litigated Asset Seizure public safety program, State Housing Loan Program and various governmental expendable special revenue/trusts of funds donated to the City for various community projects and programs.

To accoun
t for the collection of an d expenditure of fees impose d as a condition of ne w development within the City, i n compliance with California Government Code Section 66006 (AB 1600). Impact fees have been established for each of the following types of public facilities: Traffic signals, Street improvements, Community recreation center, City office space, Fire stations, Libraries, Police stations, Parkland, Street tree & street signs, Street light in-lieu, Air quality mitigation, and Public facilities fees – administration.

To account for the accumulation of resources for the retirement of principal and interest payment on long-term debt for municipal bonds issued on behalf of and approved by the Stockton Public Financing Authority.

To account for the Local Transportation Fund revenues derived from a 1/4-cent general sales tax. The revenues collected are used for non-transit related purposes.

To account for resources for development planning and project review services including land use entitlements, permit processing and review and inspection of public improvements to ensure orderly physical growth and development of the City as approved by the City Council. Revenues and fees collected and recorded in this fund are committed to its related activities. 130

ATTACHMENT A
State Solid Measure K Measure M
Housing Waste & Gas Streets Strong
Grants Recycling Tax Sales Tax Communities
ASSETS
Cash and investments 7,794,630$ 5,754,658$ 11,200,594$ 19,806,603$ 30,370,360$ Receivables, net:

Interest 12,571 26,783 34,995 52,867 78,893 Accounts and other 589 269,983 - - - Lease - - - - - Advance deposits - - 20,836 21,883 18,097 Due from other governments, net - - 1,728,947 1,892,198 2,180,528 Prepaid items - - - - - Loans to Successor Agency, net 1,106,580 - - - - Loans to property owners, net 69,051,489 - - - - Total assets 77,965,859$ 6,051,424$ 12,985,372$ 21,773,551$ 32,647,878$

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES AND FUND BALANCES
Liabilities:

Accounts payable 411,054$ 6,173$ 179,074$ 473,491$ 352,114$ Accrued payroll and benefits 66 46,451 168,767 4,313 187,801 Due to other governments - - - - 579,618 Deposits and other liabilities - 3,915 - - - Total liabilities 411,120 56,539 347,841 477,804 1,119,533 Deferred Inflows of Resources:

Unavailable revenue - Other - - - 263,452 -
Lease - - - - - Total deferred inflows of resource - - - 263,452 - Fund Balances:

Nonspendable - - 20,836 21,883 18,097 Restricted 77,554,739 5,994,885 12,616,695 21,010,412 31,510,248 Total fund balances 77,554,739 5,994,885 12,637,531 21,032,295 31,528,345 Total liabilities, deferred inflows of
resources and fund balances 77,965,859$ 6,051,424 $ 12,985,372 $ 21,773,551 $ 32,647,878 $ (Continued)
Special Revenue Funds
City of Stockton
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2022
131

ATTACHMENT A
Measure W Other Transportation
Public Special Development Special Development
Safety Tax Assessments Services Revenue Act
ASSETS
Cash and investments 8,867,883$ 18,694,115$ 33,624,938$ 5,596,039$ 935,777$ Receivables, net:

Interest 20,176 49,430 80,079 7,432 - Accounts and other - 477,719 754,273 554,558 - Lease - - - 13,979 - Advance deposits - - 63,041 1,530 - Due from other governments, net 2,185,781 - 65,000 13,354 405,997 Prepaid items - - 25,315 - - Loans to Successor Agency, net - - - - - Loans to property owners, net - - - - - Total assets 11,073,840$ 19,221,264$ 34,612,646$ 6,186,892$ 1,341,774$

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES AND FUND BALANCES
Liabilities:

Accounts payable 95,016$ 692,862$ 510,824$ 277,133$ -$ Accrued payroll and benefits 425,528 16,181 395,359 34,054 - Due to other governments 579,618 - - - - Deposits and other liabilities - - 831,778 179,589 - Total liabilities 1,100,162 709,043 1,737,961 490,776 - Deferred Inflows of Resources:

Unavailable revenue - Other - - 175,223 1,931 - Lease - -
- 13,964 -
Total deferred inflows of resource - - 175,223 15,895 - Fund Balances:

Nonspendable - - 88,356 1,530 - Restricted 9,973,678 18,512,221 32,611,106 5,678,691 1,341,774 Total fund balances 9,973,678 18,512,221 32,699,462 5,680,221 1,341,774 Total liabilities, deferred inflows of
resources and fund balances 11,073,840$ 19,221,264 $ 34,612,646 $ 6,186,892 $ 1,341,774 $ (Continued)
City of Stockton
Combining Balance Sheet (Continued)
Nonmajor Governmental Funds
June 30, 2022
Special Revenue Funds
132

ATTACHMENT A
Capital Debt Permanent
Projects Fund Service Fund Fund
Public Stockton Public
Facilities Financing
Impact Fees Authority Miscellaneous Totals
ASSETS
Cash and investments 69,024,564$ 1,920,096$ 381,793$ 213,972,050$ Receivables, net:

Interest 172,191 (9,944) 548 526,021 Accounts and other 637,284 - - 2,694,406 Lease - - - 13,979 Advance deposits - - - 125,387 Due from other governments, net - - - 8,471,805 Prepaid items - - - 25,315 Loans to Successor Agency, net - - - 1,106,580 Loans to property owners, net - - - 69,051,489 Total assets 69,834,039$ 1,910,152$ 382,341$ 295,987,032$

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES AND FUND BALANCES
Liabilities:

Accounts payable 1,978,598$ (57,461)$ -$ 4,918,878$ Accrued payroll and benefits 7,557 13,736 - 1,299,813 Due to other governments 765,495 - - 1,924,731 Deposits and other liabilities - - - 1,015,282 Total liabilities 2,751,650 (43,725) - 9,158,704 Deferred Inflows of Resources:

Unavailable revenue - Other 696,155 - - 1,136,761 Lease - - - 13,964 Total deferred inflows of resource 696,155 - - 1,150,725
Fund Balances:

Nonspendable - - - 150,702 Restricted 66,386,234 1,953,877 382,341 285,526,901 Total fund balances 66,386,234 1,953,877 382,341 285,677,603 Total liabilities, deferred inflows of
resources and fund balances 69,834,039$ 1,910,152 $ 382,341 $ 295,987,032$ (Concluded)
City of Stockton
Combining Balance Sheet (Continued)
Nonmajor Governmental Funds
June 30, 2022
133

ATTACHMENT A
State Solid Measure K Measure M
Housing Waste & Gas Streets Strong
Grants Recycling Tax Sales Tax Communities
REVENUES:

Taxes:

Sales - levied by City -$ -$ -$ 7,913,790$ 14,799,784$ Franchise fees - 2,006,664 - - - Business license - - - - - Licenses and permits - - - - - Intergovernmental:

Federal grants and subsidies - - - - - Sales and use tax - levied by state - - - - - Other governmental - 1,655,933 13,989,979 758,687 - Charges for services - - - - - Fines and forfeitures - - - - - Use of money and property 310,871 - - - - Investment income:

Interest income (loss) (146,792) (96,211) (412,635) (684,645) (961,746) Refunds and reimbursements - - 75,301 2,263 - Miscellaneous 26,577 16,839 - - - 190,656 3,583,225 13,652,645 7,990,095 13,838,038 EXPENDITURES:

Current:

General government 29,314 - 4,310 - - Public safety - - - - - Public works -
2,111,314 6,641,566 3,694,888 - Library - - - - 2,553,949 Parks and recreation - - - - 4,228,315 Capital outlay - - 1,403,038 781,027 - Debt service:

Principal retirement - - - - - Interest and fiscal charges - - - - - Total expenditures 29,314 2,111,314 8,048,914 4,475,915 6,782,264

EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES 161,342 1,471,911 5,603,731 3,514,180 7,055,774 OTHER FINANCING SOURCES (USES):

Transfers in 997,023 - - - - Transfers out - - (3,519,869) (2,158,093) (3,165,000) Total other financing sources (uses) 997,023 - (3,519,869) (2,158,093) (3,165,000) NET CHANGES IN FUND BALANCES 1,158,365 1,471,911 2,083,862 1,356,087 3,890,774 FUND BALANCES:

Beginning of year 76,396,374 4,522,974 10,553,669 19,676,208 27,637,571 End of year 77,554,739$ 5,994,885$ 12,637,531$ 21,032,295$ 31,528,345$ (Continued)
Special Revenue
City of Stockton
Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds
For the Year Ended June 30, 2022
134

ATTACHMENT A
Measure W Other Transportation
Public Special Development Special Development
Safety Tax Assessments Services Revenue Act
REVENUES:

Taxes:

Sales - levied by City 14,824,975$ -$ -$ -$ -$ Franchise fees - - - - - Business license - 1,881,035 - - - Licenses and permits - - 8,563,121 54,561 - Intergovernmental:

Federal grants and subsidies - - - 247 - Sales and use tax - levied by state - - - - - Other governmental - - - 4,766,401 405,997 Charges for services - 4,176,900 13,938,308 70,424 - Fines and forfeitures - - 124,671 - - Use of money and property - - 8,171 14,014 - Investment income:

Interest income (loss) (223,214) (626,937) (972,744) (109,849) - Refunds and reimbursements - - - - - Miscellaneous - - 15,688 860,607 - 14,601,761 5,430,998 21,677,215 5,656,405 405,997 EXPENDITURES:

Current:

General government - 1,881,283 10,683,746 12,950 - Public safety 11,947,172 - 3,018,414 1,683,794 - Public works -
3,776,846 - 467,448 - Library - - - 13,200 - Parks and recreation - - - - - Capital outlay 877,809 - 3,970 68,916 - Debt service:

Principal retirement - - - - - Interest and fiscal charges - - - - - Total expenditures 12,824,981 5,658,129 13,706,130 2,246,308 -

EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES 1,776,780 (227,131) 7,971,085 3,410,097 405,997 OTHER FINANCING SOURCES (USES):

Transfers in - - 800,000 - - Transfers out - - - (234,575) - Total other financing sources (uses) - - 800,000 (234,575) - NET CHANGES IN FUND BALANCES 1,776,780 (227,131) 8,771,085 3,175,522 405,997 FUND BALANCES:

Beginning of year 8,196,898 18,739,352 23,928,377 2,504,699 935,777 End of year 9,973,678$ 18,512,221$ 32,699,462$ 5,680,221$ 1,341,774$ (Continued)
Special Revenue
City of Stockton
Combining Statement of Revenues, Expenditures and Changes in Fund Balances (Continued) Nonmajor Governmental Funds
For the Year Ended June 30, 2022
135

ATTACHMENT A
Capital Projects Debt Service Permanent
Public Stockton Public
Facilities Financing
Impact Fees Authority Miscellaneous Totals
REVENUES:

Taxes:

Sales - levied by City - $ - $ - $ 37,538,549$ Franchise fees - - - 2,006,664 Business license - - - 1,881,035 Licenses and permits - - - 8,617,682 Intergovernmental:

Federal grants and subsidies - - - 247 Sales and use tax - levied by state - - - - Other governmental - - - 21,576,997 Charges for services 11,328,007 - - 29,513,639 Fines and forfeitures - - - 124,671 Use of money and property 71,411 - - 404,467 Investment income:

Interest income (loss) (2,148,360) 121,863 (12,747) (6,274,017) Refunds and reimbursements 253,000 - - 330,564 Miscellaneous - 1,618,282 - 2,537,993 9,504,058 1,740,145 (12,747) 98,258,491 EXPENDITURES:

Current:

General government 449,959 165,210 75 13,226,847 Public safety - - - 16,649,380 Public works 157,951 - - 16,850,013 Library - - - 2,567,149 Parks and recreation - - - 4,228,315 Capital outlay 2,007,695 - - 5,142,455 Debt service:

Principal retirement - 164,013 - 164,013 Interest and fiscal charges - 7,245,358 - 7,245,358 Total expenditures 2,615,605 7,574,581 75 66,073,530

EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES 6,888,453 (5,834,436) (12,822) 32,184,961 OTHER FINANCING SOURCES (USES):

Transfers in - 5,816,875 - 7,613,898 Transfers out (3,670,130) - - (12,747,667) Total other financing sources (uses) (3,670,130) 5,816,875 - (5,133,769) NET CHANGES IN FUND BALANCES 3,218,323 (17,561) (12,822) 27,051,192 FUND BALANCES:

Beginning of year 63,167,911 1,971,438 395,163 258,626,411 End of year 66,386,234$ 1,953,877$ 382,341$ 285,677,603$ (Concluded)
City of Stockton
Combining Statement of Revenues, Expenditures and Changes in Fund Balances (Continued) Nonmajor Governmental Funds
For the Year Ended June 30, 2022
136

ATTACHMENT A

INTERNAL SERVICE FUNDS

ATTACHMENT A

ATTACHMENT A
The City’s internal service funds include:

General Liability Insurance Fund
Workers’ Compensation Insurance Fund
Employee Health Insurance Fund
Retirement Benefits Fund
Other Benefits and Insurance Fund
Vehicle Fleet Equipment Fund
Computer and Radio Equipment Fund
Other Equipment Fund

INTERNAL SERVICE FUNDS
Internal service funds are a type of proprietary fun d used to report an y activity that provides goods an d services on a cost- reimbursement basis to other funds, departments, or agencies of the primary government and its component units, or to other governments.

To account for premiums and claims paid and the administration of general liability insurance provided to all City departments on a cost reimbursement basis. The fund also accounts for future estimated related liabilities to the City based on independent actuarial studies utilizing insurance industry standards of applicable data, factors and assumptions.

To account for premiums and claims paid and the administration of workers’ compensation liability insurance provided to all City employees incurring injury on the job, of which health benefits and other related liability costs are funded by City department payments into the fund. The fund also accounts for future estimated related liabilities to the City based on independent actuarial studies utilizing insurance industry standards of applicable data, factors and assumptions.

To accoun
t for premiums and claims paid and the administration of health benefits insurance provided to qualifie d active and qualified retired City employees, with City departmental payments made to the Fund sought to reimburse health related expenses incurred by the Fund. The fund also accounts for future estimated related liabilities to the City based on independent actuarial studies utilizing insurance industry standards of applicable data, factors and assumptions.

To account for the financing, operations, servicing and maintenance of fleet vehicles and major equipment utilized by City departments, of which the services are rendered on a cost reimbursement basis.

To account for the financing, service and maintenance of all computer, radio equipment and related equipment provided to City departments on a cost reimbursement basis.

To account for the financing, operating and maintenance of other, comparatively smaller equipment funds provided to City departments on a cost reimbursement basis. Included are office, printing, and mailing equipment.

To account for premiums and claims paid and the administration of comparatively smaller insurance funds provided to City employees on a cost reimbursement basis. Included are long - term disability, life insurance, unemployment, and termination pay benefits.

To account for the accumulation and payout of resources for the purpose of providing defined retirement and disability benefits, annual cost of living adjustments and death benefits to City employee plan members and beneficiaries through the California Public Employees’ Retirement System (“CalPERS”) on a cost reimbursement basis. The fund also accounts for future estimated related liabilities to the City based on independent actuarial studies utilizing insurance industry standards of applicable data, factors and assumptions, of which were pre-funded by bond proceeds from the 2007 Taxable Pension Obligations Bonds, Series A and B.
137

ATTACHMENT A
General Workers' Employee Other
Liability Compensation Health Retirement Benefits &
Insurance Insurance Insurance Benefits Insurance
ASSETS
Current assets:

Cash and investments 23,339,033$ 42,177,569$ 5,583,460$ 4,810,390$ 870,467$ Receivables, net:

Interest 48,977 172,146 16,221 163,005 2,786 Accounts and other receivables 340,065 - 395 - - Inventories - - - - - Deposits and advances - 446 136,370 - - Prepaid items - - 705,708 - - Loans to other funds - short-term - 1,097,322 - - - Total current assets 23,728,075 43,447,483 6,442,154 4,973,395 873,253 Noncurrent assets:

Restricted assets:

Cash and investments - - - 69,968,331 - Loans to other funds - long-term - 7,733,072 - - - Capital assets, net:

Nondepreciable - - - - - Depreciable, net - - - - - Total noncurrent assets - 7,733,072 - 69,968,331 - Total assets 23,728,075 51,180,555 6,442,154 74,941,726 873,253

LIABILITIES
Current liabilities:

Accounts payable 16,250 60,716 725,013 1,255,446 36,703 Accrued payroll 48,134 31,857
38,103 3,886 -
Deposits and other liabilities - 49,104 - - - Accrued interest - - - - - Compensated absences - due in one year 31,649 2,751 4,077 - - Lease payable - due in one year - - - - - Claims payable, due in one year 3,568,791 9,014,000 396,000 - - Loans from other funds- current - - - - - Total current liabilities 3,664,824 9,158,428 1,163,193 1,259,332 36,703 Noncurrent liabilities:

Compensated absences - due in more than one year 10,199 - - - - Lease payable - due in more than one year - - - - - Claims payable, due in more than one year 11,935,442 40,486,000 - - - Loans from other funds- due in more than one year - - - - - Total noncurrent liabilities 11,945,641 40,486,000 - - - Total liabilities 15,610,465 49,644,428 1,163,193 1,259,332 36,703

NET POSITION
Net investment in capital assets - - - - - Restricted for pensions - - - 69,968,331 - Unrestricted 8,117,610 1,536,127 5,278,961 3,714,063 836,550
Total net position 8,117,610$ 1,536,127 $ 5,278,961 $ 73,682,394 $ 836,550 $ City of Stockton
Combining Statement of Net Position
Internal Service Funds
June 30, 2022
138

ATTACHMENT A
Computer
Vehicle Fleet and Radio Other
Equipment Equipment Equipment Total
ASSETS
Current assets:

Cash and investments 16,398,192 $ 47,024,435 $ 1,506,349 $ 141,709,895 $ Receivables, net:

Interest 40,793 112,991 3,498 560,417 Accounts and other receivables - - - 340,460 Inventories - 179,726 - 179,726 Deposits and advances 283,055 138,125 - 557,996 Prepaid items 679,409 1,501,667 44,998 2,931,782 Loans to other funds - short-term - 495,600 - 1,592,922 Total current assets 17,401,449 49,452,544 1,554,845 147,873,198 Noncurrent assets:

Restricted assets:

Cash and investments - - - 69,968,331 Loans to other funds - long-term - - - 7,733,072 Capital assets, net:

Nondepreciable 6,322,767 15,774,365 - 22,097,132 Depreciable, net 16,049,598 5,359,829 213,765 21,623,192 Total noncurrent assets 22,372,365 21,134,194 213,765 121,421,727 Total assets 39,773,814 70,586,738 1,768,610 269,294,925

LIABILITIES
Current liabilities:

Accounts payable 535,580 527,058 58,476 3,215,242 Accrued payroll 113,435 246,124 7,565 489,104 Deposits and other liabilities - - - 49,104 Accrued interest 14,975 - 91 15,066 Compensated absences - due in one year 64,639 154,524 5,726 263,366
Lease payable - due in one year - - 50,116 50,116 Claims payable, due in one year - - - 12,978,791 Loans from other funds- current 454,217 - - 454,217 Total current liabilities 1,182,846 927,706 121,974 17,515,006 Noncurrent liabilities:

Compensated absences - due in more than one year 42,395 116,332 6,697 175,623 Lease payable - due in more than one year - - 152,044 152,044 Claims payable, due in more than one year - - - 52,421,442 Loans from other funds- due in more than one year 1,364,845 - - 1,364,845 Total noncurrent liabilities 1,407,240 116,332 158,741 54,113,954 Total liabilities 2,590,086 1,044,038 280,715 71,628,960

NET POSITION
Net investment in capital assets 22,372,365 21,134,194 213,765 43,720,324 Restricted for pensions - - - 69,968,331 Unrestricted 14,811,363 48,408,506 1,274,130 83,977,310 Total net position 37,183,728$ 69,542,700 $ 1,487,895 $ 197,665,965 $ City of Stockton
Combining Statement of Net Position (Continued)
Internal Service Funds
June 30, 2022
139

ATTACHMENT A
General Workers' Employee Other
Liability Compensation Health Retirement Benefits and
Insurance Insurance Insurance Benefits Insurance
OPERATING REVENUES:

Charges for services 11,497,347$ 11,797,117$ 22,114,760$ 71,762,532$ 2,863,860$ Miscellaneous - 15 - - - Total operating revenues 11,497,347 11,797,132 22,114,760 71,762,532 2,863,860 OPERATING EXPENSES:

Operation and maintenance 11,379,486 1,697,764 21,888,606 75,234,094 3,116,000 General and administrative 1,988,387 3,336,967 1,159,138 95 531 Depreciation and amortization - - - - - Total operating expenses 13,367,873 5,034,731 23,047,744 75,234,189 3,116,531 OPERATING INCOME (LOSS) (1,870,526) 6,762,401 (932,984) (3,471,657) (252,671) NONOPERATING REVENUES (EXPENSES):

Investment income:

Interest income (loss) (622,815) (1,095,919) (199,449) (7,991,007) (34,888) Interest expense and fiscal charges - - - - - Other nonoperating revenues - - 103,769 1,389,317 63,484 Total non-operating revenues (expenses) (622,815) (1,095,919) (95,680) (6,601,690) 28,596

INCOME (LOSS) BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS (2,493,341) 5,666,482 (1,028,664) (10,073,347) (224,075)

CAPITAL CONTRIBUTIONS

AND TRANSFERS
Capital contributions - - - - - Transfers in - - - 234,575 -

Total capital contributions and transfers - - - 234,575 - CHANGES IN NET POSITION (2,493,341) 5,666,482 (1,028,664) (9,838,772) (224,075) NET POSITION:

Beginning of year, as restated (Note 19) 10,610,951 (4,130,355) 6,307,625 83,521,166 1,060,625 End of year 8,117,610$ 1,536,127 $ 5,278,961 $ 73,682,394 $ 836,550 $ City of Stockton
Combining Statement of Revenues, Expenses, and Changes in Net Position Internal Service Funds
For the Year Ended June 30, 2022
140

ATTACHMENT A
Computer
Vehicle Fleet and Radio Other
Equipment Equipment Equipment Total
OPERATING REVENUES:

Charges for services 14,073,527 $ 17,581,296 $ 308,662 $ 151,999,101$ Miscellaneous - - - 15 Total operating revenues 14,073,527 17,581,296 308,662 151,999,116 OPERATING EXPENSES:

Operation and maintenance 6,919,520 11,311,510 298,764 131,845,744 General and administrative 1,251,460 - - 7,736,578 Depreciation and amortization 3,171,400 1,573,275 59,019 4,803,694 Total operating expenses 11,342,380 12,884,785 357,783 144,386,016 OPERATING INCOME (LOSS) 2,731,147 4,696,511 (49,121) 7,613,100 NONOPERATING REVENUES (EXPENSES):

Investment income:

Interest income (loss) (478,363) (1,411,335) (44,952) (11,878,728) Interest expense and fiscal charges (41,125) - (1,257) (42,382) Other nonoperating revenues - 7,143 - 1,563,713 Total non-operating revenues (expenses) (519,488) (1,404,192) (46,209) (10,357,397)

INCOME (LOSS) BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS 2,211,659 3,292,319 (95,330) (2,744,297)

CAPITAL CONTRIBUTIONS

AND TRANSFERS
Capital contributions 6,001,060 14,620 - 6,015,680 Transfers in 65,979 - - 300,554 Total capital contributions and transfers 6,067,039 14,620 - 6,316,234 CHANGES IN NET POSITION 8,278,698 3,306,939 (95,330) 3,571,937 NET POSITION:

Beginning of year, as restated (Note 19) 28,905,030 66,235,761 1,583,225 194,094,028
End of year 37,183,728$ 69,542,700 $ 1,487,895 $ 197,665,965 $ City of Stockton
Combining Statement of Revenues, Expenses, and Changes in Net Position (Continued) Internal Service Funds
For the Year Ended June 30, 2022
141

ATTACHMENT A
General Workers' Employee Other
Liability Compensation Health Retirement Benefits &
Insurance Insurance Insurance Benefits Insurance

CASH FLOWS FROM OPERATING
ACTIVITIES:

Receipts for interfund services provided 11,516,557$ 11,842,796$ 22,114,760$ 71,762,532$ 2,863,860$ Payments to suppliers and employees (13,322,965) (5,042,829) (21,990,347) (75,414,492) (3,207,952) Claims and insurance paid 4,979,607 (5,895,000) - - - Net cash provided by (used in) operating
activities 3,173,199 904,967 124,413 (3,651,960) (344,092)

CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES:

Transfers in and out - - - 234,575 - Loans to and from other funds - 1,097,321 - - - Other nonoperating revenues - - 103,769 1,389,317 127,718 Net cash provided by (used in) noncapital
financing activities - 1,097,321 103,769 1,623,892 127,718

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Purchases of capital assets - - - - - Principal paid on debt - - - - - Interest paid on debt - - - - - Net cash (used in) capital and related
financing activities - - - - - CASH FLOWS FROM INVESTING ACTIVITIES:

Investment earnings (625,436) (1,084,759) (205,663) (8,136,268) (34,617) Net cash provided by investing activities (625,436) (1,084,759) (205,663) (8,136,268) (34,617)

NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS 2,547,763 917,529 22,519 (10,164,336) (250,991)
CASH AND CASH EQUIVALENTS:

Beginning of year 20,791,270 41,260,040 5,560,941 84,943,057 1,121,458 End of year 23,339,033$ 42,177,569 $ 5,583,460 $ 74,778,721 $ 870,467 $

RECONCILIATION OF CASH

AND INVESTMENTS TO THE STATEMENT OF
NET POSITION - PROPRIETARY FUNDS:

Cash and investments 23,339,033 $ 42,177,569 $ 5,583,460 $ 4,810,390 $ 870,467 $ Restricted assets:

Cash with investments fiscal agents - - - 69,968,331 - Total cash and investment
s 23,339,033$ 42,177,569 $ 5,583,460 $ 74,778,721 $ 870,467 $ City of Stockton
Combining Statement of Cash Flows
For the Year Ended June 30, 2022
Internal Service Funds
142

ATTACHMENT A
Computer
Vehicle Fleet and Radio Other
Equipment Equipment Equipment Total

CASH FLOWS FROM OPERATING
ACTIVITIES:

Receipts for interfund services provided 14,227,602 $ 17,865,696 $ 308,662 $ 152,502,465$ Payments to suppliers and employees (9,078,498) (12,514,115) (285,721) (140,856,919) Claims and insurance paid - - - (915,393) Net cash provided by (used in) operating
activities 5,149,104 5,351,581 22,941 10,730,153

CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES:

Transfers in and out - - 234,575 Loans to and from other funds (486,720) - - 610,601 Other nonoperating revenues - 97,350 - 1,718,154 Net cash provided by (used in) noncapital
financing activities (486,720) 97,350 - 2,563,330

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Purchases of capital assets (2,336,907) (6,051,652) - (8,388,559) Principal paid on debt (206,486) - (49,954) (256,440) Interest paid on debt (50,508) - (1,166) (51,674) Net cash (used in) capital and related
financing activities (2,593,901) (6,051,652) (51,120) (8,696,673) CASH FLOWS FROM INVESTING ACTIVITIES:

Investment earnings (484,086) (1,392,025) (44,648) (12,007,502) Net cash provided by investing activities (484,086) (1,392,025) (44,648) (12,007,502)

NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS 1,584,397 (1,994,746) (72,827) (7,410,692) CASH AND CASH EQUIVALENTS:

Beginning of year 14,813,794 49,019,181 1,579,176 219,088,917 End of yea
r 16,398,191$ 47,024,435 $ 1,506,349 $ 211,678,225 $

RECONCILIATION OF CASH

AND INVESTMENTS TO THE STATEMENT OF
NET POSITION - PROPRIETARY FUNDS:

Cash and investments 16,398,192 $ 47,024,435 $ 1,506,349 $ 141,709,895 $ Restricted assets:

Cash with investments fiscal agents - - - 69,968,331 Total cash and investment
s 16,398,192$ 47,024,435 $ 1,506,349 $ 211,678,226 $ City of Stockton
Combining Statement of Cash Flows (Continued)
Internal Service Funds
For the Year Ended June 30, 2022
143

ATTACHMENT A
General Workers' Employee Other
Liability Compensation Health Retirement Benefits &
Insurance Insurance Insurance Benefits Insurance

RECONCILIATION OF OPERATING INCOME
(LOSS) TO NET CASH PROVIDED BY (USED
FOR) OPERATING ACTIVITIES:

Operating income (loss) (1,870,526)$ 6,762,401$ (932,984)$ (3,471,657)$ (252,671)$ Adjustments to reconcile operating income
(loss) to net cash provided by (used for)
operating activities:

Depreciation and amortization - - - - - Changes in assets and liabilities:

Accounts and other receivables 19,210 26,424 - - - Due from other funds 19,240
Prepaid items 1,576 446 (110,963) - - Inventory of supplies - - - - - Deposits and advances - (446) 632,736 - - Accounts payable 14,179 (5,976) 554,029 (180,297) (91,421) Accrued payroll (4,809) 12,029 13,612 (6) - Compensated absences 33,962 (14,151) (32,017) - - Self-insurance - claims and judgments 4,979,607 (5,895,000) - - - Net cash provided by (used in) operating
activities 3,173,199$ 904,967$ 124,413$ (3,651,960)$ (344,092)$ NONCASH TRANSACTIONS:

Capital contributions -$ -$ -$ -$ -$ City of Stockton
Combining Statement of Cash Flows (Continued)
Internal Service Funds
For the Year Ended June 30, 2022
144

ATTACHMENT A
Vehicle Fleet Computer Other
Equipment Equipment Equipment Total

RECONCILIATION OF OPERATING INCOME
(LOSS) TO NET CASH PROVIDED BY (USED
FOR) OPERATING ACTIVITIES:

Operating income (loss) 2,731,147 $ 4,696,511 $ (49,121) $ 7,613,100 $ Adjustments to reconcile operating income
(loss) to net cash provided by (used for)
operating activities:

Depreciation and amortization 3,171,400 1,573,275 59,019 4,803,694 Changes in assets and liabilities:

Accounts and other receivables 154,075 - - 199,709 Due from other funds - 284,400 - 303,640 Prepaid items (382,580) (380,360) (21,948) (893,829) Inventory of supplies - (179,726) - (179,726) Deposits and advances (283,055) - - 349,235 Accounts payable (213,840) (527,253) 32,688 (417,891) Accrued payroll 1,941 12,261 401 35,429 Compensated absences (29,984) (127,527) 1,902 (167,815) Self-insurance - claims and judgments - - - (915,393) Net cash provided by (used in) operating
activities 5,149,104$ 5,351,581 $ 22,941 $ 10,730,153$ NONCASH TRANSACTIONS:

Capital contributions 6,001,060 $ 14,620 $ - $ 6,015,680$ City of Stockton
Combining Statement of Cash Flows (Continued)
Internal Service Funds
For the Year Ended June 30, 2022
145

ATTACHMENT A
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146

ATTACHMENT A

CUSTODIAL-FIDUCIARY FUNDS

ATTACHMENT A

ATTACHMENT A
The City’s custodial funds include:

Land-Secured Financing Agency Fund
All Other Agency Funds
To account for various cultural, recreational and educational programs that the City administers on behalf of other governmental and private sector entities and organizations.

CUSTODIAL FUNDS
Custodial funds are a type of fiduciary fund used to account for assets held in an agency capacity for parties outside the City. The resources of these funds cannot be used to support the City’s own programs.

To accoun
t for special taxes or assessmen t collections fro m property owners tha t are authorized unde r various public improvement acts of the State of California. The City acts only as an agent and forwards collections to bondholders and initiated foreclosure proceedings when necessary.
147

ATTACHMENT A
Land-Secured
Financing All Other Total
Assets:

Cash and investments 8,223,126 $ 16,992,472 $ 25,215,598 $ Cash and investments with fiscal agents 6,472,600 - 6,472,600 Receivables:

Interest 19,748 42,524 62,272 Accounts and other receivables - 3,662,249 3,662,249 Total assets 14,715,474 20,697,245 35,412,719 Liabilities:

Accounts payable 2,600 21,694 24,294
Due to other governments - 2,950,173 2,950,173 Total liabilities 2,600 2,971,867 2,974,467 Net Position:

Restricted for individual, organization,
and other government 14,712,874 17,725,378 32,438,252 Total net positions 14,712,874$ 17,725,378 $ 32,438,252 $ City of Stockton
Combining Statement of Fiduciary Net Position
Fiduciary Funds - Custodial Funds
June 30, 2022
148

ATTACHMENT A
Land-Secured
Financing All Other Total
ADDITIONS:

Property taxes 7,844,621$ - $ 7,844,621$ Use of money and property 87 - 87 Investment income (loss) (271,943) (552,840) (824,783) Total additions 7,572,765 (552,840) 7,019,925 DEDUCTIONS:

General government 373,760 - 373,760 Public works 5,748,509 1,778,443 7,526,952 Debt obligations 7,362,720 - 7,362,720 Total deductions 13,484,989 1,778,443 15,263,432 CHANGE IN NET POSITION (5,912,224) (2,331,283) (8,243,507) NET POSITION:

Beginning of year, 20,625,098 20,056,661 40,681,759 End of year 14,712,874$ 17,725,378 $ 32,438,252 $ City of Stockton
For the Year Ended June 30, 2022
Fiduciary Funds - Custodial Funds
Combining Statement of Changes in Fiduciary Net Position 149

ATTACHMENT A
Final Year End Variance with
Budget Actual Final Budget
Revenues
Measure A Transaction and Use Tax 36,132,000$ 45,412,129$ 9,280,129$ Total revenues 36,132,000 45,412,129 9,280,129 Uses/Expenditures
Police
Salary & benefits
Sworn 22,715,023 18,420,634 4,294,389
Non-Sworn 4,144,699 3,055,935 1,088,764 Vacancy savings (936,054) - (936,054) Other services 3,035,090 2,838,027 197,063 Materials & supplies
Fuel 281,265 359,709 (78,444) Other supplies 454,007 204,581 249,426 Other expenses
Technology upgrade - 9,515 (9,515) Training 595,000 520,287 74,713 Capital outlay 77,254 - 77,254 Total police 30,366,284 25,408,688 4,957,596 Office of Violence Prevention
Salary & benefits
Non-sworn 899,409 618,937 280,472 Other services 400,706 191,624 209,082 Materials & supplies
Fuel 3,182 3,933 (751) Other supplies 59,999 35,067 24,932 Office equipment 3,979 914 3,065 Other expenses 20,000 637 19,363 Total Office of Violence Prevention 1,387,275 851,112 536,163 Basis Adjustment
Encumbrances (included in final budget) - 344,973 (344,973)

Total Measure B Expenditures 31,753,559 26,604,773 5,148,786 Crime Prevention (Measure B) expenditures
as a % of annual Measure A revenues 88% 59%
Other City Services
General Fund available fund balance 4,378,441 18,807,356 (14,428,915) Total adjustment 4,378,441 18,807,356 (14,428,915) Total Uses/Expenditures 36,132,000$ 45,412,129 $ (9,280,129) $ Schedule of Sources and Uses
Measures A and B
For Year Ended June 30, 2022
City of Stockton
150

ATTACHMENT A

STATISTICAL SECTION

ATTACHMENT A

ATTACHMENT A
Operating Information (pages 185-191)
These schedules contain service and infrastructure data to help the reader understand how the information in the City’s financial report relates to the services the government provides and the activities it performs.

STATISTICAL SECTION OVERVIEW
This part of the City’s annual comprehensive financial report is not covered by the Independent Auditor’s Report, but presents supplemental detailed information for the benefit of readers in understanding what the information in the financial statements, note disclosures, and required supplementary information says about the government’s overall financial health.

Financial Trends (pages 152-165)
These schedules contain trend information to help the reader understand how the City’s financial performance and well- being have changed over time.

Revenue Capacity (pages 166-173)
These schedules contain information to help the reader assess the City’s most significant local revenue sources, transient occupancy tax (“TOT”) and property taxes.

Debt Capacity (pages 174-182)
These schedules present information to help the reader assess the affordability of the City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future.

Demographic and Economic Information (pages 183-184)
These schedules offer demographic and economic indicators to help the reader understand the environment with which the City’s financial activities take place.
151

ATTACHMENT A
2022 2021 2020 2019 2018
Governmental activities:

Net investment in capital assets 764,271$ 732,219$ 724,164$ 346,021$ 328,284$ Restricted 524,405 457,693 239,339 204,114 170,507 Unrestricted (171,510) (262,907) (119,715) 260,748 238,421 1,117,166 927,005 843,787 810,883 737,211 Business-type activities:

Net investment in capital assets 438,676 365,873 301,434 381,015 367,317 Restricted 25,394 46,241 125,668 28,411 46,805 Unrestricted 200,819 224,551 177,840 155,217 133,656 664,889 636,665 604,942 564,643 547,778 Primary government:

Net investment in capital assets 1,202,947 1,098,093 1,025,598 727,036 695,601 Restricted 549,799 503,934 365,007 232,525 217,311 Unrestricted 29,309 (38,356) 58,125 415,965 372,077 1,782,055$ 1,563,670$ 1,448,729$ 1,375,526$ 1,284,989$ Source: City of Stockton Department of Administrative Services Note: Some prior year balances may have been restated from previous ACFRs to reflect new GASB implementations or prior period restatements.

Total governmental activities net position
Total business-type activities net position
Total primary government net position
Fiscal Year
City of Stockton
Table 1
Net Position by Classification
Last Ten Fiscal Years
(Dollar amounts in thousands)
152

ATTACHMENT A
2017 2016 2015 2014 2013
Governmental activities:

Net investment in capital assets 330,655$ 287,078$ 326,823$ 714,595$ 725,426$ Restricted 148,493 153,087 130,763 96,596 93,905 Unrestricted 229,584 196,005 160,224 (62,855) (82,351) 708,732 636,170 617,810 748,336 736,980 Business-type activities:

Net investment in capital assets 362,886 369,983 379,853 413,783 418,881 Restricted 50,904 54,618 56,521 54,175 56,589 Unrestricted 82,938 44,792 28,751 42,641 38,380 496,728 469,393 465,125 510,599 513,850 Primary government:

Net investment in capital assets 693,540 657,061 706,676 1,128,378 1,144,307 Restricted 199,397 207,705 187,284 150,771 150,494 Unrestricted 312,522 240,797 188,975 (20,214) (43,971) 1,205,460$ 1,105,563$ 1,082,935$ 1,258,935$ 1,250,830$ Source: City of Stockton Department of Administrative Services Fiscal Year
Note: Some prior year balances may have been restated from previous ACFRs to reflect new GASB implementations or prior period restatements.

Total governmental activities net position
Total business-type activities net position
Total primary government net position
City of Stockton
Table 1
Net Position by Classification (Continued)
Last Ten Fiscal Years
(Dollar amounts in thousands)
153

ATTACHMENT A
2022 2021 2020 2019 2018
72,154$ 74,314$ 37,269$ 37,821$ 37,259$ 170,564 217,953 217,941 199,263 212,181 43,601 55,086 44,922 37,168 38,435 13,107 12,792 14,657 13,501 12,301 14,300 11,526 27,798 27,288 23,753 7,894 4,373 5,298 5,914 5,964 321,620 376,045 347,885 320,954 329,894 Business-type activities:
54,532 54,266 47,974 46,641 39,526 66,991 61,124 63,983 58,093 41,648 7,288 6,759 6,599 7,419 4,729 5,687 4,995 5,795 5,501 5,310 1,375 1,667 2,499 3,613 3,299 Total business-type activities 135,873 128,811 126,850 121,267 94,512 Total expenses 457,493 504,856 474,736 442,221 424,406

Governmental activities:

Charges for services:

General government 31,123 12,560 9,250 13,977 16,451 Public safety 18,688 13,235 11,220 16,925 15,309 Public works 14,291 32,456 3,143 10,367 14,914 Library 7,537 7,037 278 470 595 Parks and recreation 852 406 4,010 11,320 12,194 Operating grants and contributions 100,879 51,329 21,509 13,446 12,402 Capital grants and contributions 47,352 39,065 30,227 45,632 21,426 Total governmental activities 220,723 156,087 79,637 112,137 93,292 Business-type activities:

Charges for services:

Water utility 66,013 64,097 57,519 49,489 50,590 Wastewater utility 78,509 73,885 71,210 67,432 68,191 Stormwater utility 6,137 6,040 6,417 6,407 5,683 Parking Authority 5,690 4,589 4,749 4,592 4,447 Other 428 355 1,038 1,755 1,776 Operating grants and contributions 2,500 - 7,314 3,643 3,855 Capital grants and contributions 12,231 13,263 7,258 4,626 6,245 171,508 162,229 155,504 137,944 140,787 Total program revenues 392,230 318,316 235,141 250,081 234,078 Change in Net Position
Governmental activities (100,897) (219,957) (268,248) (208,817) (236,603) Business-type activities 35,635 33,417 28,654 16,677 46,275 Total primary government (65,263) $ (186,540) $ (239,594) $ (192,140) $ (190,328) $ Water utility
Wastewater utility
Program Revenues
Total business-type activities
Other
Expenses
General government
Public safety
Public works
Library
Governmental activities:

Total governmental activities
Stormwater utility
Parks and recreation
Interest and fiscal charges
Parking Authority
City of Stockton
Table 2
Changes in Net Position
(Dollar amounts in thousands)
Last Ten Fiscal Years
Fiscal Year
154

ATTACHMENT A
2017 2016 2015 2014 2013
33,378$ 39,608$ 35,576$ 34,594$ 24,909$ 154,932 169,015 123,403 124,806 108,931 45,670 36,344 37,685 51,942 49,259 10,904 10,406 9,098 9,807 8,445 22,481 21,620 20,801 19,456 19,736 4,288 2,216 3,401 14,486 14,615 271,653 279,209 229,964 255,091 225,895 Business-type activities:
42,886 48,001 47,474 44,720 48,570 50,545 58,665 56,153 55,724 51,166 5,288 6,601 7,084 5,758 5,959 5,641 5,384 5,026 5,120 4,944 3,235 3,116 3,374 3,448 2,939 Total business-type activities 107,595 121,767 119,111 114,770 113,578 Total expenses 379,248 400,976 349,075 369,861 339,473

Governmental activities:

Charges for services:

General government 19,184 15,831 15,169 14,785 17,977 Public safety 9,188 13,663 16,863 21,016 18,130 Public works 3,373 8,292 6,105 5,178 6,136 Library 377 517 441 437 670 Parks and recreation 8,765 9,158 6,145 5,655 6,597 Operating grants and contributions 12,565 12,861 18,823 18,840 23,827 Capital grants and contributions 17,591 16,286 34,268 36,052 57,146 Total governmental activities 71,043 76,608 97,814 101,963 130,483 Business-type activities:

Charges for services:

Water utility 42,308 33,277 35,059 37,855 37,464 Wastewater utility 66,833 68,938 65,726 59,953 55,369 Stormwater utility 5,619 5,573 5,569 5,571 5,503 Parking Authority 5,141 4,971 4,170 2,882 2,669 Other 1,675 1,750 1,769 1,870 1,934 Operating grants and contributions 3,889 3,776 5,133 3,865 4,175 Capital grants and contributions 2,971 3,562 2,945 1,112 4,700 128,436 121,847 120,371 113,108 111,814 Total program revenues 199,479 198,455 218,185 215,071 242,297 Change in Net Position
Governmental activities (200,610) (202,601) (132,150) (153,128) (95,412) Business-type activities 20,841 80 1,260 (1,662) (1,764) Total primary government (179,769) $ (202,521) $ (130,890) $ (154,790) $ (97,176) $ Expenses
Governmental activities:

General government
Public safety
Public works
Library
Parks and recreation
Interest and fiscal charges
Total governmental activities
Water utility
Wastewater utility
Stormwater utility
Parking Authority
Other
Program Revenues
City of Stockton
Table 2
Last Ten Fiscal Years
Changes in Net Position (Continued)
(Dollar amounts in thousands)
Fiscal Year
Total business-type activities
155

ATTACHMENT A
2022 2021 2020 2019 2018
General Revenues and Other
Change in Net Position:

Governmental activities:

Taxes:

Property 41,066$ 38,523$ 36,692$ 35,739$ 33,112$ In lieu of sales tax - - - - Utility user 38,328 36,414 34,537 34,252 35,415 Sales - levied by City (1) 75,037 68,639 57,077 57,911 52,788 Franchise fees 21,186 16,901 15,292 12,307 13,243 Business licenses 15,905 15,695 14,557 19,958 13,507 Hotel/motel room 3,620 2,860 2,834 3,377 3,193 Document transfer 1,626 1,222 912 1,071 1,078 Other 4,016 2,874 3,262 2,905 2,916 Shared revenue: - - - Vehicle license fees 27,310 27,757 31,839 23,599 29,091 Sales and use tax levied by state (1) 76,239 65,201 56,122 57,151 68,467 Other 18,303 - 165 (25,552) 14,086 21,759 18,438 899 (132) 147 12 (1,602) (203) 10,369 11,105 9,469 7,810 4,083
- - (547) 500 6,203 - - - - - - - - - - Transfers from Successor Agency, Net - - - - 734 438 1,751 (922) 9,074 389 289,456 303,175 301,198 282,489 265,082 Business-type activities:
- - 1,407 1,341 1,271 - - - - 100 Investment earnings (7,018) 57 9,318 7,920 233 Gain on sale of capital assets - - (2) - 20 - - - - - - - - - 3,540 Transfers (438) - 922 (9,074) (389) - (1,751) - - - Total business-type activities (7,456) (1,694) 11,645 188 4,774 282,000 301,481 312,843 282,676 269,857 Change in Net Position
Governmental activities 188,559 83,218 32,950 73,671 28,479 Business-type activities 28,178 31,723 40,299 16,865 51,049 Total primary government 216,737 $ 114,941 $ 73,249 $ 90,536 $ 79,529 $ Source: City of Stockton Department of Administrative Services (2) In fiscal year 2015 Extraordinary items for Government activities and Business-type activites relate to GASB #58 Bankruptcy, with both principal and interest debt forgiven. GASB #68 Penision obligations being restated to show on balance sheet.

Extraordinary items (2)
changes in net assets
Total general revenues and other
(1) Measure A-Public Safety Tax, an additional .75% sales tax approved 2014, and Measure M - a new .25% sales tax approved in 2017 contributed to increases Special item
Investment earnings
Gain (Loss) on disposal of capital assets
Miscellaneous
(Dollar amounts in thousands)
Total governmental activities
Extraordinary items
Miscellaneous
Special item
Transfers
Grants and contributions not restricted to
Other taxes
Proceeds of long-term debt
Fiscal Year
City of Stockton
Table 2
Changes in Net Position (Continued)
Last Ten Fiscal Years
156

ATTACHMENT A
2017 2016 2015 2014 2013
General Revenues and Other
Change in Net Position:

Governmental activities:

Taxes:

Property 32,411$ 30,646$ 29,573$ 28,015$ 29,420$ In lieu of sales tax 8,775 9,816 9,706 9,938 Utility user 34,455 33,379 32,921 32,370 31,941 Sales - levied by City (1) 42,506 39,070 37,208 15,536 9,086 Franchise fees 13,289 12,397 12,379 11,981 11,677 Business licenses 12,243 11,996 10,805 10,392 10,153 Hotel/motel room 2,997 2,711 2,378 2,080 2,006 Document transfer 801 857 587 564 458 Other 1,939 1,801 930 728 287 Shared revenue:

Vehicle license fees 21,423 20,354 19,602 18,069 17,433 Sales and use tax levied by state (1) 49,910 45,097 36,904 35,111 34,031 Other 44 45 49 253 400 1,966 4,728 1,532 1,128 123 578 568 (13,214) (3,712) (1) 2,820 7,303 16,982 3,042 2,411 - - - - 10,237 - 23,396 - - - - 250,701 - - Transfers from Successor Agency, Net - - - - - 654 (297) 383 1,330 524 228,273 219,430 472,932 166,593 159,887 Business-type activities:
1,292 1,239 974 1,166 1,197 - - - - - Investment earnings 131 2,653 1,172 1,448 530 Gain on sale of capital assets (1,156) - (3,300) - - - - - 431 14 - - - - - Transfers (654) 297 (383) (1,330) (524) - - 9,548 - - Total business-type activities (387) 4,189 8,011 1,715 1,217 227,886 223,619 480,943 168,308 161,104 Change in Net Position
Governmental activities 27,662 16,829 340,782 13,465 64,475 Business-type activities 20,454 4,271 9,271 53 (547) Total primary government 48,116 $ 21,100 $ 350,053 $ 13,518 $ 63,928 $ Source: City of Stockton Department of Administrative Services changes in net assets
Total general revenues and other
(1) Measure A-Public Safety Tax, an additional .75% sales tax approved 2014, and Measure M - a new .25% sales tax approved in 2017 contributed to increases (2) In fiscal year 2015 Extraordinary items for Government activities and Business-type activites relate to GASB #58 Bankruptcy, with both principal and interest debt forgiven. GASB #68 Penision obligations being restated to show on balance sheet. (Dollar amounts in thousands)
Miscellaneous
Special item
Extraordinary items (2)
Proceeds of long-term debt
Extraordinary items
Transfers
Total governmental activities
Other taxes
Special item
Miscellaneous
Gain on sale of capital assets
Investment earnings
Fiscal Year
City of Stockton
Table 2
Changes in Net Position (Continued)
Last Ten Fiscal Years
Grants and contributions not restricted to
157

ATTACHMENT A
2022 2021 2020 2019 2018
General Fund
Nonspendable 2,077$ 2,215$ 5,796$ 3,621$ 1,303$ Restricted 5,289 4,428 3,998 4,034 4,730 Committed 123,754 77,638 59,714 54,243 45,957 Assigned 4,285 4,526 4,017 4,144 2,227 Unassigned 43,208 42,049 41,085 37,990 36,265 Total General Fund 178,613 130,857 114,611 104,032 90,482 All other governmental funds
Nonspendable 151 152,462 356 356 370 Restricted 428,305 222,308 189,758 169,507 117,387 Committed - - - - - Assigned - - - - - Unassigned - - - - - Total all other governmental funds 428,456 374,770 190,114 169,863 117,757 Total Fund Balance 607,069$ 505,627$ 304,725$ 273,895$ 208,239$ Source: City of Stockton Department of Administrative Services Fiscal Year
City of Stockton
Table 3
Fund Balance, Governmental Funds
Last Ten Fiscal Years
(Dollar amounts in thousands)
158

ATTACHMENT A
2017 2016 2015 2014 2013
General Fund
Nonspendable 1,539$ 2,214$ 810$ 500$ 409$ Restricted 4,603 3,549 2,949 3,551 2,334 Committed 56,439 49,088 28,930 34,008 23,775 Assigned 3,922 5,467 - 3,059 1,710 Unassigned 36,184 33,326 38,639 9,751 3,093 Total General Fund 102,687 93,644 71,328 50,869 31,321 All other governmental funds
Nonspendable - 373 382 443 369 Restricted 114,254 122,084 104,785 81,435 75,157 Committed - - - - - Assigned - - - - - Unassigned 3,232 - - (20,669) (18,793) Total all other governmental funds 117,486 122,457 105,167 61,209 56,733 Total Fund Balance 220,173$ 216,101$ 176,495$ 112,078$ 88,054$ Source: City of Stockton Department of Administrative Services Fiscal Year
City of Stockton
Table 3
Fund Balance, Governmental Funds (Continued)
Last Ten Fiscal Years
(Dollar amounts in thousands)
159

ATTACHMENT A
2022 2021 2020 2019 2018
Revenues:

Taxes:

Property 41,066 $ 38,523 $ 36,692 $ 35,342 $ 33,068 $ In lieu of sales tax - - - - 44 Utility user 38,328 36,414 34,537 34,252 35,415 Sales (levied by City) (1) 82,951 68,639 57,077 57,911 52,788 Franchise fees 19,932 16,901 15,292 12,307 13,243 Business license 15,906 15,695 14,557 13,215 13,507 Hotel/motel room 3,620 2,860 2,834 3,377 3,193 Document transfer 1,626 1,222 912 1,071 1,126 Other 4,016 2,874 3,262 2,905 2,916 Licenses and permits 9,129 7,670 6,847 6,744 6,214 Federal grants and subsidies 84,812 30,339 15,578 16,517 13,235 Other shared revenue (sales and use tax levied by state) (1) 76,239 65,201 56,122 51,577 53,817 Other governmental 85,662 99,161 59,367 66,594 57,778 Charges for services 39,532 31,330 26,904 27,227 29,377 Fines and forfeitures 2,001 379 1,101 1,277 1,247 Use of money and property 9,955 5,731 10,569 12,460 9,528 Investment income: - -
Interest income (loss) (13,673) 7,785
14,075 11,758 1,063
Refunds and reimbursements 550 602 6,633 6,614 7,887 Miscellaneous 8,258 10,189 8,981 8649 8,596 Total revenues 509,910 441,514 371,340 369,795 344,044 Expenditures:

Current:

General government 76,830 72,185 30,148 30,537 26,761 Public safety 206,107 205,923 193,778 189,824 184,426 Public works 34,263 41,960 20,120 19,793 18,852 Library 14,659 12,762 14,400 13,789 12,416 Parks and recreation 14,552 8,207 25,920 26,006 22,462 Capital outlay 53,034 26,127 31,225 35,158 51,210 Debt service: - - - Principal retirement 1,943 1,806 1,699 11,477 2,204 Cost of issuance - - - - Interest and fiscal charges 7,397 4,617 5,229 5,627 5,767 Total expenditures 408,785 373,587 322,521 332,211 324,098 Excess (deficiency) of revenues
over (under) expenditures 101,125$ 67,926$ 48,819$ 37,584$ 19,946$ City of Stockton
Fiscal Year
Table 4
Changes in Fund Balance of Governmental Funds
Last Ten Fiscal Years
(Dollar amounts in thousands)
160

ATTACHMENT A
2017 2016 2015 2014 2013
Revenues:

Taxes:

Property 32,411 $ 30,646 $ 29,573 $ 28,014 $ 29,420 $ In lieu of sales tax - 8,775 9,816 9,706 9,938 Utility user 34,455 33,379 32,921 32,369 31,941 Sales (levied by City) (1) 42,506 39,070 37,208 15,536 9,086 Franchise fees 13,289 12,397 12,380 11,981 11,677 Business license 12,243 11,996 10,805 10,392 10,153 Hotel/motel room 2,997 2,711 2,378 2,080 2,006 Document transfer 801 856 587 565 458 Other 1,939 1,535 930 728 287 Licenses and permits 5,867 5,347 4,398 3,808 3,696 Federal grants and subsidies 12,859 10,470 21,796 22,453 23,158 Other shared revenue (sales and use tax levied by state) (1) 49,910 45,097 36,904 35,111 34,031 Other governmental 37,574 36,696 41,806 47,951 71,746 Charges for services 22,920 26,473 21,351 19,410 19,059 Fines and forfeitures 1,164 624 3,814 2,925 2,419 Use of money and property 8,197 8,172 9,318 9,536 13,767 Investment income:

Interest income (loss) 1,762 3,088 916 650 119
Refunds and reimbursements 6,077 5,188 12,710 2,401 1,814 Miscellaneous 6,745 11,246 16,674 7,707 6,942 Total revenues 293,716 293,766 306,285 263,323 281,717 Expenditures:

Current:

General government 29,235 27,229 34,652 25,510 23,245 Public safety 171,073 150,853 141,542 129,030 125,331 Public works 15,818 14,861 14,152 14,458 13,498 Library 10,619 10,107 9,880 9,793 9,039 Parks and recreation 20,493 19,295 19,094 17,202 17,733 Capital outlay 31,407 23,857 31,345 43,273 72,568 Debt service:

Principal retirement 13,593 3,325 8,217 9,589 9,013 Cost of issuance 2,119 - - - Interest and fiscal charges 2,872 3,229 4,661 5,957 Total expenditures 295,110 251,646 262,111 253,516 276,384 Excess (deficiency) of revenues
over (under) expenditures (1,394)$ 42,120$ 44,174$ 9,807$ 5,333$ City of Stockton
Fiscal Year
Table 4
Changes in Fund Balance of Governmental Funds (Continued) Last Ten Fiscal Years
(Dollar amounts in thousands)
161

ATTACHMENT A
2022 2021 2020 2019 2018
Other financing sources (uses):

Capital contributions - $ - $ - $ - $ Transfers in 27,618 19,903 18,062 31,310 19,077 Transfers out (27,480) (41,452) (36,445) (29,479) (37,913) Transfers from successor Agency - - - - 734 Special Item (Note 18) - - - - 6,203 Bond insurers proceeds 163 - - - - Operating transfers out to a component unit - - - - - Proceeds of current refunding bonds - - - - - Sales of capital assets 17 2,419 393 52 800 Advances from other funds - - - - - Payment to refunded bond escrow agent - - - - - Total other financing sources (uses) 318 (19,131) (17,990) 1,884 (11,099) Special items
Net change in fund balance 101,442 48,796 30,830 39,468 8,847 Fund balance, beginning of year, original 505,627 456,831 273,895 234,427 225,581 Fund balance, beginning of year, restated 505,627 456,831 273,895 234,427 225,581 Fund balance, end of year 607,069 $ 505,627 $ 304,725 $ 273,895 $ 234,427 $ Debt service as a percentage of noncapital expenditures 644956.6% 2.4% 6.1% 3.0% 6.7% Note: Some prior year balances may have been restated from previous ACFRs to reflect new GASB implementations or prior period restatement.

City of Stockton
Table 4
Changes in Fund Balance of Governmental Funds (Continued) Last Ten Fiscal Years
(Dollar amounts in thousands)
(1) Measure A-Public Safety Tax, an additional .75% sales tax approved in 2014, and Measure M - a new .25% sales tax approved in 2017 contributed to increases
Fiscal Year
162

ATTACHMENT A
2017 2016 2015 2014 2013
Other financing sources (uses):

Capital contributions - $ - $ - $ - $ - $ Transfers in 23,347 15,916 16,860 13,497 - Transfers out (12,966) (18,810) (20,235) (13,031) 30,678 Transfers from successor Agency - - - - (30,360) Special Item (Note 18) - - - - - Bond insurers proceeds - - 29,178 7,800 Operating transfers out to a component unit - - - - 8,287 Proceeds of current refunding bonds - - - - - Sales of capital assets 492 379 521 200 - Advances from other funds - - - - - Payment to refunded bond escrow agent - - (6,080) - - Total other financing sources (uses) 10,873 (2,515) 20,244 8,466 8,605 Special items - - - - Net change in fund balance 9,479 39,605 64,417 18,273 13,938 Fund balance, beginning of year, original 216,100 176,495 112,078 93,806 79,869 Fund balance, beginning of year, restated 216,100 176,495 112,078 93,806 79,869 Fund balance, end of year 225,579 $ 216,100 $ 176,495 $ 112,078 $ 93,806$ Debt service as a percentage of noncapital expenditures 6.7% 2.4% 5.2%

7.3% 7.9%
(Dollar amounts in thousands)
City of Stockton
Table 4
Changes in Fund Balance of Governmental Funds (Continued) Last Ten Fiscal Years
Note: Some prior year balances may have been restated from previous ACFRs to reflect new GASB implementations or prior period restatement. (1) Measure A-Public Safety Tax, an additional .75% sales tax approved in 2014, and Measure M - a new .25% sales tax approved in 2017 contributed to increases
Fiscal Year
163

ATTACHMENT A
2022 2021 2020 2019 2018
Property (1) 41,066$ 38,523$ 36,692$ 35,342$ 33,068$ In lieu of sales tax - - - - 44 Utility user 38,328 36,414 34,537 34,252 35,415 Sales (levied by city) (2) 82,951 68,639 57,077 57,911 52,788 Franchise fees 19,932 16,901 15,292 12,307 13,243 Business licenses 15,905 15,695 14,557 13,215 13,507 Hotel/motel room 3,620 2,860 2,834 3,377 3,193 Document transfer 1,626 1,222 912 1,071 1,126 Other 4,016 2,874 3,262 2,905 2,916 Totals 207,444$ 183,127$ 165,163$ 160,379$ 155,301$ Source: City of Stockton Department of Administrative Services Fiscal Year
(1) Property taxes decrease d beginning in 2009 due to declining residential home values and foreclosures, resulting in a devaluation o f City’s assessed valuation performed by San Joaquin County. Also, between 2008 and 2011, property taxes collected by the RDA was included in the City's property tax revenue.
(2) Measure A-Public Safety Tax, an additional .75% sales tax approved in 2014, and Measure M - a new .25% sales tax approved in 2017 contributed to increases.

City of Stockton
Table 5
Tax Revenues by Source, Governmental Funds
Last Ten Fiscal Years
(Dollar amounts in thousands)
164

ATTACHMENT A
2017 2016 2015 2014 2013
% Change
2013
to 2022
Property (1) 32,411$ 30,646$ 29,573$ 28,014$ 29,420$ 40% In lieu of sales tax - 8,775 9,816 9,706 9,938 -100% Utility user 34,455 33,379 32,921 32,369 31,941 20% Sales (levied by city) (2) 42,506 39,070 37,208 15,536 9,086 813% Franchise fees 13,289 12,397 12,380 11,981 11,677 71% Business licenses 12,243 11,995 10,805 10,392 10,153 57% Hotel/motel room 2,997 2,711 2,378 2,080 2,006 80% Document transfer 801 856 587 565 458 255% Other 1,535 930 728 287 1299% Totals 138,702$ 141,364$ 136,598$ 111,371$ 104,966$ 98% Source: City of Stockton Department of Administrative Services City of Stockton
Table 5
Tax Revenues by Source, Governmental Funds (Continued)
Last Ten Fiscal Years
(Dollar amounts in thousands)
Fiscal Year
(1) Property taxes decrease d beginning in 2009 due to declining residential home values and foreclosures, resulting in a devaluation o f City’s assessed valuation performed by San Joaquin County. Also, between 2008 and 2011, property taxes collected by the RDA was included in the City's property tax revenue.
(2) Measure A-Public Safety Tax, an additional .75% sales tax approved in 2014, and Measure M - a new .25% sales tax approved in 2017 contributed to increases.
165

ATTACHMENT A
2022 2021 2020 2019 2018
Secured roll 26,379,229$ 24,952,342$ 23,628,432$ 22,488,506$ 21,378,475$ Utility roll 6,496 6,507 5,827 5,816 5,863 Unsecured roll 1,563,966 1,507,064 1,439,016 1,610,921 1,629,758 Gross assessed value 27,949,691 26,465,914 25,073,275 24,105,243 23,014,096 Less exemptions (1) 2,020,034 1,980,526 1,948,125 1,917,101 1,532,852 Net assessed value 25,929,657 24,485,388 23,125,150 22,188,142 21,481,244 Land 7,164,141 6,823,616 6,506,827 6,280,943 6,081,944 Improvements 19,716,382 18,716,229 17,635,057 16,582,837 15,666,837 Personal property 1,069,169 926,070 931,391 1,241,463 1,265,315 Gross assessed value 27,949,691 26,465,914 25,073,275 24,105,243 23,014,096 Less exemptions (1) 2,020,034 1,980,526 1,948,125 1,917,101 1,532,852 Net assessed value 25,929,657$ 24,485,388$ 23,125,150$ 22,188,142$ 21,481,244$ Total Direct Tax Rate 1.00% 1.00% 1.00% 1.00% 1.00%

Source: San Joaquin County Auditor-Controller's Office (1) For FY 2022, all exemptions (secured, utility, and unsecured rolls) are: homeowners - $215,033 and other - $1,805,001 = $2,020,034 Note: In 1978 the voters of the State of California passed Proposition 13 which limited property taxes to a total maximum rate of 1% based upon the assessed value of the property being taxed. Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only reassessed at the time that it is sold to a new owner. At that point, the property being sold is reassessed at the purchase price. The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property and is subject to the limitations described above.

Last Ten Fiscal Years
(Dollar amounts in thousands)
Fiscal Year
City of Stockton
Table 6
Assessed Value and Estimated Actual Value of Taxable Property 166

ATTACHMENT A
2017 2016 2015 2014 2013
Secured roll 20,299,172$ 19,473,994$ 18,496,369$ 16,981,109$ 16,272,927$ Utility roll 5,833 6,199 6,209 6,228 7,504 Unsecured roll 1,596,101 1,651,844 1,638,161 1,557,131 1,566,497 Gross assessed value 21,901,106 21,132,037 20,140,739 18,544,468 17,846,928 Less exemptions (1) 1,786,986 1,729,742 1,717,223 1,699,348 1,608,513 Net assessed value 20,114,120 19,402,295 18,423,516 16,845,120 16,238,415 Land 5,713,082 5,420,167 4,978,511 4,597,437 4,019,017 Improvements 15,004,037 14,501,054 13,928,278 12,868,329 12,696,221 Personal property 1,183,987 1,210,816 1,233,950 1,078,702 1,131,690 Gross assessed value 21,901,106 21,132,037 20,140,739 18,544,468 17,846,928 Less exemptions (1) 1,786,986 1,729,742 1,717,223 1,699,348 1,608,513 Net assessed value 20,114,120$ 19,402,295$ 18,423,516$ 16,845,120$ 16,238,415$ Total Direct Tax Rate 1.00% 1.00% 1.00% 1.00% 1.00%
Source: San Joaquin County Auditor-Controller's Office (1) For FY 2022, all exemptions (secured, utility, and unsecured rolls) are: homeowners - $215,033 and other - $1,805,001 = $2,020,034 Note: In 1978 the voters of the State of California passed Proposition 13 which limited property taxes to a total maximum rate of 1% based upon the assessed value of the property being taxed. Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only reassessed at the time that it is sold to a new owner. At that point, the property being sold is reassessed at the purchase price. The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property and is subject to the limitations described above.

Last Ten Fiscal Years
(Dollar amounts in thousands)
Fiscal Year
City of Stockton
Table 6
Assessed Value and Estimated Actual Value of Taxable Property (Continued) 167

ATTACHMENT A
Fiscal Year
Basic
Countywide
Levy City Total Direct
Stockton Unified
School District
San Joaquin
Delta College
District Total
2022 1.0000 - 1.0000 0.1922 0.0163 1.2085 2021 1.0000 - 1.0000 0.2271 0.0183 1.2454 2020 1.0000 - 1.0000 0.2455 0.0199 1.2654 2019 1.0000 - 1.0000 0.2443 0.0225 1.2668 2018 1.0000 - 1.0000 0.2054 0.0180 1.2234 2017 1.0000 - 1.0000 0.2537 0.0180 1.2717 2016 1.0000 - 1.0000 0.2710 0.0198 1.2908 2015 1.0000 - 1.0000 0.2280 0.0233 1.2513 2014 1.0000 - 1.0000 0.2105 0.0194 1.2299 2013 1.0000 - 1.0000 0.1917 0.0202 1.2119 Source: San Joaquin County Tax Rate Book
Note: On June 6, 1978, California voters approved an amendment to the Article XIIIA of the California Constitution. The amendment, commonly known as Proposition 13, limits the taxing power of California public agencies. The California Legislature enacted legislation to implement Article XIIIA (Statues of 1978, Chapter 292, as amended) providing that local agencies may not levy any property tax except to pay debt service on indebtedness approved by voters prior to July 1, 1978, and that each county will levy the maximum tax permitted of $1.00 per $100.00 of full assessed value.

City of Stockton
Table 7
Direct and Overlapping Property Tax Rates
Last Ten Fiscal Years
(Rate per $100 of assessed value)
168

ATTACHMENT A

2022 2013
Taxpayer
Taxable
Assessed Value Rank
Taxable
Assessed Value Rank
PW Fund B Development 207,617 $ 1 0.851 49,062 7 0.333 % Prologis 201,251 2 0.825 % - 0.000 % Patmon Company Inc 149,501 3 0.613 % - 0.000 % Excel Stockton LLC 126,103 4 0.517 % 122,966 2 0.836 % EGMR Norcal Logistics Center LLC 108,519 5 0.445 % - 0.000 % Central Valley Indust core holdings LLC 96,237 6 0.395 % - 0.000 % Wilshire Newcastle road owner LLC 96,000 7 0.394 % - 0.000 % IDIL Stockton Logistics II 84,084 8 0.345 % 86,070 3 0.585 % Simpson Manufacturing Co Inc 77,020 9 0.316 % - 0.000 % Trader Joes company 72,794 10 0.299 % - 0.000 % Buzz Oates LLC - 0.000 % 128,437 1 0.873 % Diamond Walnut Growers Inc - 0.000 % 72,600 4 0.493 % Dameron Hospital Associations - 0.000 % 70,458 5 0.479 % Corn Products International Inc - 0.000 % 65,728 6 0.447 % Fresh and Easy Neighborhood Market Inc. - 0.000 % 46,771 8 0.318 % Inland Western Stockton Airport Way II LLC - 0.000 % 45,422 9 0.309 % WTM Glimcher LLC - 0.000 % 44,113 10 0.300 % Principal Secured Property Valuation 1,219,126 5.000 % 731,627 4.973 % Other Secured Taxpayers 25,160,103 103.179 15,541,300 105.641 Total Secured Property Valuation Before Exemptions 26,379,229 108.179 % 16,272,927 110.614 % Less Exemptions relative to secured tax roll (1) 1,994,405 8.179 1,561,472 10.614 Total Secured Property Valuation 24,384,825$ 100.000 % 14,711,455$ 100.000 % (1) Exemptions relative to secured tax roll: FY 2022 - homeowners - $214,936 and other - $1,779,468 = $1,994,405 FY 2013 - homeowners - $240,576 and other - $1,320,896 = $1,561,472 Source: San Joaquin County Assessor's Office
San Joaquin County Auditor-Controller's Office
Percent of Total
City Taxable
Assessed Value
Percent of Total
City Taxable
Assessed Value
Note: In 1978 the voters of the State of California passed Proposition 13 which limited property taxes to a total maximum rate of 1% based upon the assessed value of the property being taxed. Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only reassessed at the time that it is sold. At that point, the purchase price becomes the new assessed value. The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property and is subject to the limitations described above.

City of Stockton
Table 8
Principal Property Taxpayers
Current Year and Ten Years Ago
(Dollar amounts in thousands)
Fiscal Year
169

ATTACHMENT A
Amount Amount
2022 39,099$ 39,099$ 100 % - 39,099$ 100 % 2021 36,615$ 36,615$ 100 % - 36,615$ 100 % 2020 34,739$ 34,739$ 100 % - 34,739$ 100 % 2019 33,521$ 33,521$ 100 % - 33,521$ 100 % 2018 31,193$ 31,193$ 100 % - 31,193$ 100 % 2017 30,495$ 30,495$ 100 % - 30,495$ 100 % 2016 28,907$ 28,907$ 100 % - 28,907$ 100 % 2015 27,852$ 27,852$ 100 % - 27,852$ 100 % 2014 25,952$ 25,952$ 100 % - 25,952$ 100 % 2013 24,745$ 24,745$ 100 % - 24,745$ 100 % Source: San Joaquin County Auditor-Controller’s Office Collections in
Subsequent
Years
Secured Taxes
Levied for the
Fiscal YearFiscal Year
Percent of
Levy (1)
Percent of
Levy
Total Collections
to Date
(1) Per agreement with San Joaquin County; the County provides the City with 100% of the amount owed for secured properties, regardless of collection status. In exchange, the County is entitled to 100% of delinquency and penalty revenues collected.

City of Stockton
Table 9
Secured Property Tax Levies and Collections
Last Ten Fiscal Years
(Dollar amounts in thousands)
Collected Within the Fiscal Year of the
Levy
170

ATTACHMENT A
2022 2021 2020 2019 2018
Type of Customer
Residential 8,204,224 cf 10,610,177 cf 7,997,883 cf 7,669,451 cf 8,231,972 cf Institutional 858,661 1,105,150 827,124 789,265 632,738 Commercial/Industrial 1,707,532 2,018,500 1,588,605 1,645,890 1,640,471 Irrigation 1,603,842 2,025,832 1,457,258 1,294,982 1,310,062 Total 12,374,259 15,759,659 cf 11,870,870 cf 11,399,588 cf 11,815,243 cf 1 cubic foot (cf) = 7.481 gallons
Source: City of Stockton Department of Administrative Services City of Stockton
Table 10
Water Sold by Customer Type
Last Five Fiscal Years
Fiscal Year
171

ATTACHMENT A
This page intentionally left blank.
172

ATTACHMENT A
Wastewater
Fiscal Year Monthly Base Rate
Tier 1 Additional Per
100 cf**
Tier 2 Additional Per
100 cf** Monthly Base Rate
2022 33.90$ 2.47 $ 2.95 $ 49.56 $ 2021 33.90$ 2.47 $ 2.95 $ 46.75 $ 2020 32.90$ 2.39 $ 2.86 $ 44.10 $ 2019 31.95$ 2.31 $ 2.76 $ 38.36 $ 2018 31.00$ 2.23 $ 2.66 $ 38.36 $ 2017 28.00$ 2.00 $ 2.39 $ 38.36 $ 2016 22.25 $ 1.67 $ - $ 37.76 $ 2015 21.90 $ 1.64 $ - $ 37.09 $ 2014 21.51 $ 1.61 $ - $ 34.03 $ 2013 21.15 $ 1.58 $ - $ 31.22 $ *Effective 8/01/2016-Water Consumption Tier 1 0-15 CF and Tier 2 15+CF. 100 cf = 100 cubic feet (748 gallons)
Rates are based on 1" and less meter, which is the standard household meter size. **The Utility charges an excess use rate above normal demand.

Source: City of Stockton Department of Administrative Services Water
City of Stockton
Table 11
Water and Wastewater Utility Rates
Last Ten Fiscal Years
173

ATTACHMENT A
Fiscal
Year
Revenue*
Bonds (1)
Certificates
of
Participation
Redevelopment
Agency
Revenue Bonds*
Notes
Payable / Lease
Payable /
Settlements
Pension
Bonds*
Total
Governmental
Activities
2022 -$ -$ -$ 4,700$ 53,084$ 57,784$ 2021 -$ -$ -$ 6,321$ 53,248$ 59,569$ 2020 -$ -$ 91,935$ 8,196$ 53,378$ 153,509$ 2019 -$ -$ 95,560$ 9,990$ 53,478$ 159,028$ 2018 9,425$ -$ 99,125$ 15,853$ 53,547$ 177,950$ 2017 9,915$ -$ 103,320$ 18,130$ 53,589$ 184,954$ 2016 10,385$ 11,500$ 111,424$ 18,298$ 53,606$ 205,213$ 2015 10,835$ 11,890$ 113,262$ 18,095$ 54,530$ 208,612$ 2014 75,285$ 12,265$ 119,210$ 20,157$ 121,770$ 348,687$ 2013 81,465$ 12,625$ 122,100$ 25,326$ 123,350$ 364,866$ *Includes settlement amounts for debts adjusted under Chapter 9 of the US Bankruptcy Code.

Sources: City of Stockton Department of Administrative Services US Dept. of Commerce, Bureau of Economic Analysis
State of California, Department of Finance
(1) These ratios are calculated using the latest available data, personal income for fiscal year 2017 and population for fiscal year 2019.

Details regarding the City's outstanding debt can be found in the Notes to the Financial Statements, Note 7-Long-Term Debt and Note 7-Short- Term Debt of these financial statements.

Governmental Activities*
City of Stockton
Table 12
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
(Dollar amounts in thousands, except per capita)
174

ATTACHMENT A
Fiscal
Year
Revenue
Bonds
Certificates
of
Participation
Notes
Payable /
Lease Payable
Total
Business-type
Activities Total
Amount
Per
Capita (2)
2022 274,238$ - $ 121,514$ 395,752 $ 453,536 $ 1.26 % 1,406$ 2021 261,845$ -$ 129,381$ 391,226$ 450,795$ 1.25 % 1,405$ 2020 144,710$ -$ 129,380$ 274,090$ 427,599$ 1.19 % 1,342$ 2019 279,039$ -$ 10,870$ 289,909$ 448,937$ 1.41 % 1,419$ 2018 312,700$ -$ 10,870$ 323,570$ 501,520$ 2.32 % 1,592$ 2017 326,165$ -$ 10,870$ 337,035$ 521,989$ 1.85 % 1,628$ 2016 336,218$ -$ 10,954$ 347,172$ 552,385$ 2.56 % 1,750$ 2015 343,926$ -$ 11,040$ 354,966$ 563,578$ 2.61 % 1,836$ 2014 284,225$ 81,270$ 11,123$ 376,618$ 725,305$ 3.36 % 2,410$ 2013 289,360$ 84,500$ 11,202$ 385,062$ 749,928$ 3.47 % 2,531$ *Includes settlement amounts for debts adjusted under Chapter 9 of the US Bankruptcy Code.

Sources: City of Stockton Department of Administrative Services US Dept. of Commerce, Bureau of Economic Analysis
State of California, Department of Finance
Percent
of
Personal
Income (2)
Details regarding the City's outstanding debt can be found in the Notes to the Financial Statements, Note 7-Long-Term Debt and Note 7-Short-Term Debt of these financial statements.
(1) These ratios are calculated using the latest available data, personal income for fiscal year 2017 and population for fiscal year 2019.

Business-Type Activities
City of Stockton
Table 12
Ratios of Outstanding Debt by Type (Continued)
Last Ten Fiscal Years
(Dollar amounts in thousands, except per capita)
175

ATTACHMENT A
General Bonded Debt Outstanding*
Fiscal Year
Lease
Revenue
Bonds
Certificates
of
Participation
(2)
Pension
Obligation
Bonds (1)
Redevelopment
Agency
Bonds* Total
Amount
Per
Capita
2022 -$ - $ 53,084$ - $ 53,084$ 0.002 % 0.16 $ 2021 -$ - $ 53,248$ - $ 53,248$ 0.002 % 0.17 $ 2020 - $ - $ 53,378$ - $ 53,378$ 0.002 % 0.17 $ 2019 - $ - $ 53,478$ - $ 53,478$ 0.002 % 0.17 $ 2018 9,425 $ - $ 53,547$ - $ 62,972$ 0.003 % 0.20 $ 2017 9,915 $ - $ 53,589$ - $ 63,504$ 0.003 % 0.20 $ 2016 10,385 $ 11,500 $ 53,606 $ - $ 75,491$ 0.004 % 0.24 $ 2015 10,835 $ 11,890 $ 54,529 $ - $ 77,254$ 0.004 % 0.25 $ 2014 75,285 $ 12,265 $ 121,770 $ 119,210 $ 328,530 $ 0.020 % 1.09 $ 2013 81,465 $ 12,625 $ 123,350 $ 122,100 $ 339,540 $ 0.021 % 1.15 $ (1)Includes settlement amounts for debts adjusted under Chapter 9 of the US Bankruptcy Code. (2)General Fund liability limited to only 80.5% of amounts due on principal shown Source: City of Stockton Department of Administrative Services San Joaquin County Auditor-Controller’s Office
State of California, Department of Finance
General bonded debt is payable with governmental fund resources. General obligation bonds (of which the City has none) are backed by the taxing authority of the City (taxes may be raised to provide resources for debt service payments.) Percent of
Assessed
Property Value
City of Stockton
Table 13
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years
(Dollar amounts in thousands, except per capita)
* Redevelopment Agency Bonds are no longer included in the General Bonded debt 176

ATTACHMENT A
Total Debt Percentage City’s share of
OVERLAPPING TAX AND ASSESSMENT DEBT: 6/30/2022 Applicable (1) Debt 6/30/2022 San Joaquin Delta Community College District 188,480,000 $ 26.558 % 50,056,518$ Stockton Unified School District 483,242,362 84.349 407,610,100 Lodi Unified School District 300,695,000 33.679 101,271,069 Lodi Unified School District School Facilities Improvement District No. 1 43,095,000 85.311 36,764,775 Lincoln Unified School District 66,074,855 86.483 57,143,517 Lincoln Unified School District Community Facilities District No. 1 15,391,567 79.882 12,295,092 Manteca Unified School District 225,734,885 13.004 29,354,564 Manteca Unified School District Community Facilities District No. 1989-1 12,582,434 100.000 12,582,434 Tracy Joint Unified School District and School Facilities Improvement Dist. No.3 133,540,900 0.003 & 0.007 8,094 City of Stockton Community Facilities District No. 99-02 22,970,000 100.000 22,970,000 City of Stockton Community Facilities District No. 2001-1 (Spanos Park West) 10,244,331 100.000 10,244,331 City of Stockton Community Facilities District No. 2003-1 1,544,655 100.000 1,544,655 City of Stockton Community Facilities District No. 2005-1 9,245,000 100.000 9,245,000 City of Stockton Community Facilities District No. 2006-1 2,274,934 100.000 2,274,934 City of Stockton Community Facilities District No. 2006-2 2,934,000 100.000 2,934,000 City of Stockton Community Facilities District No. 2006-3 4,463,939 100.000 4,463,939 City of Stockton Community Facilities District No. 2018-1 3,325,000 100.000 3,325,000 City of Stockton Community Facilities District No. 2018-2 13,505,000 100.000 13,505,000 City of Stockton 1915 Act Bonds 16,306,374 100.000 16,306,374 Reclamation District No. 2042 Community Facilities District No. 2001-1 4,076,132 18.211 742,304 San Joaquin Area Flood Control District Smith Assessment District 22,125,000 57.451 12,711,034 San Joaquin County Reclamation District No. 17 Assessment District 21,086,256 27.618 5,823,602 TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT 813,176,336
OVERLAPPING GENERAL FUND DEBT:

San Joaquin County Certificates of Participation 60,400,000 28.781 % 17,383,724
Lincoln Unified School District Certificates of Participation 8,335,751 86.483 7,209,008 Lodi Unified School District Certificates of Participation 10,065,000 33.679 3,389,791 Manteca Unified School District General Fund Obligations 15,976,000 13.004 2,077,519 Stockton Unified School District Certificates of Participation 25,500,000 84.349 21,508,995 Lathrop-Manteca Rural Fire Protection District certificates of Participation 3,490,000 0.025 873 City of Stockton Capital Lease Obligations 100.000 - City of Stockton Bond Insurer Settlement Agreement Liability 53,083,658 100.000 53,083,658 TOTAL OVERLAPPING GENERAL FUND DEBT 104,653,568
OVERLAPPING TAX INCREMENT DEBT (Successor Agency):
2016 Tax Allocation Revenue Bonds Series A 73,310,000 100.000 % 73,310,000 2016 Tax Allocation Revenue Bonds Series B 11,180,000 100.000 11,180,000 TOTAL OVERLAPPING TAX INCREMENT DEBT 84,490,000
TOTAL DIRECT DEBT 53,083,658
TOTAL OVERLAPPING DEBT 949,236,246
GROSS COMBINED TOTAL DEBT (2) 1,002,319,904
2021-22 Assessed Valuation (3): 26,144,691$
2021-22 Population 322,489
Debt Ratios Per Capita
Ratio to Assessed
Value
Total Gross Debt (2) 1,002,319,904$ 3,108 $ 3833.74 % Ratios to 2020-21 Assessed Valuation: Total Overlapping Tax and Assessment Debt 813,176,336 2,522 3110.29 Ratios to Adjusted Assessed Valuation: Combined Direct Debt 53,083,658 165 203.04 (1) Percent of overlapping agency's assessed valuation located within boundaries of the City. (3) Represents Gross Assessed Valuation after deducting $2,020,034 Sources: California Municipal Statistics, Inc., San Francisco, CA San Joaquin County Auditor-Controller’s Office
State of California, Department of Finance, Demographic Research Unit City of Stockton
Table 14
Direct and Overlapping Governmental Activities Debt
(after deducting $1,805,001 Other Exemptions Valuation ) (2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds and non-bonded capital lease obligations. 177

ATTACHMENT A
2022 2021 2020 2019 2018
Assessed valuation (1) 26,144,691$ 24,701,296$ 23,343,395$ 22,407,298$ 21,362,446$ Conversion percentage 25% 25% 25% 25% 25%
Adjusted assessed valuation 6,536,173 6,175,324 5,835,849 5,601,825 5,340,612 Debt limit percentage 15% 15% 15% 15% 15%
Debt Limit 980,426 926,299 875,377 840,274 801,092 Total net debt applicable to limit - - - Legal debt margin 980,426$ 926,299$ 875,377$ 840,274$ 801,092$ Legal debt margin/debt limit 100% 100% 100% 100% 100%
Sources: City of Stockton Department of Administrative Services California Municipal Statistics, Inc., San Francisco, CA San Joaquin County Auditor-Controller's Office
Fiscal Year
Under State law, the City has a legal debt limitation not to exceed 15% of the total assessed valuation of taxable property within the City boundaries, adjusted for subsequent legislative actions. In accordance with California Government Code Section 43605, only the City's general obligation bonds are subject to the legal limit. The City of Stockton does carry bonded debt secured by special assessments and other revenue sources, but at this time, doesn't have any outstanding general obligation bonds. The City is not at risk of exceeding its legal debt limit. (1) Reflects City assessed valuation excluding other exemptions of $1,764,618,090. Redevelopment Agency was dissolved in 2013.

City of Stockton
Table 15
Legal Debt Margin Information
Last Ten Fiscal Years
(Dollar amounts in thousands)
178

ATTACHMENT A
2017 2016 2015 2014 2013
Assessed valuation (1) 20,337,129$ 19,628,594$ 18,653,199$ 17,079,491$ 16,479,102$ Conversion percentage 25% 25% 25% 25% 25%
Adjusted assessed valuation 5,084,282 4,907,149 4,663,300 4,269,873 4,119,776 Debt limit percentage 15% 15% 15% 15% 15%
Debt Limit 762,642 736,072 699,495 640,481 617,966 Total net debt applicable to limit - - - - - Legal debt margin 762,642$ 736,072$ 699,495$ 640,481$ 617,966$ Legal debt margin/debt limit 100% 100% 100% 100% 100%
Sources: City of Stockton Department of Administrative Services California Municipal Statistics, Inc., San Francisco, CA San Joaquin County Auditor-Controller's Office
Fiscal Year
(1) Reflects City assessed valuation excluding other exemptions of $1,764,618,090. Redevelopment Agency was dissolved in 2013.

Under State law, the City has a legal debt limitation not to exceed 15% of the total assessed valuation of taxable property within the City boundaries, adjusted for subsequent legislative actions. In accordance with California Government Code Section 43605, only the City's general obligation bonds are subject to the legal limit. The City of Stockton does carry bonded debt secured by special assessments and other revenue sources, but at this time, doesn't have any outstanding general obligation bonds. The City is not at risk of exceeding its legal debt limit.

City of Stockton
Table 15
Legal Debt Margin Information (Continued)
Last Ten Fiscal Years
(Dollar amounts in thousands)
179

ATTACHMENT A
Less: Net Debt
Fiscal Gross Operating Available Debt Service Coverage
Year Revenues (1) Expenses (2) Revenue Principal Interest Total Ratio Water Revenue Bonds
2022 73,686$ 38,398$ 35,288$ 5,910$ 8,383$ 14,293$ 2.47 2021 72,506$ 23,006$ 49,500$ 5,630$ 6,770$ 12,400$ 3.99 2020 65,686$ 30,944$ 34,742$ 4,975$ 9,279$ 14,254$ 2.44 2019 54,172$ 25,163$ 29,009$ 5,000$ 11,814$ 16,814$ 1.73 2018 53,997$ 22,595$ 31,402$ 4,955$ 12,686$ 17,641$ 1.78 2017 43,643$ 23,798$ 19,845$ 83$ 12,798$ 12,881$ 1.54 2016 37,906$ 23,312$ 14,594$ 87$ 13,242$ 13,329$ 1.09 * 2015 42,416$ 22,830$ 19,586$ 4,263$ 13,397$ 17,660$ 1.11 * 2014 38,991$ 19,762$ 19,229$ 3,939$ 12,116$ 16,055$ 1.20 2013 40,601$ 21,652$ 18,949$ 3,780$ 10,139$ 13,919$ 1.36 (Continued)
* Coverage requirement is 1.15, however, it is applied in sequence, first to the senior, and then to the subordinate issues.

Done in sequence both senior and subordinate issues met the coverage requirement in both years.

City of Stockton
Table 16
Pledged-Revenue Coverage
Last Ten Fiscal Years
(Dollars amounts in thousands)
Note: Net Available Revenue for the Water Bonds provides a 3.35 debt coverage ratio for the senior lien issues and a 1.16 debt coverage ratio for the subordinate lien issues.
(2) Total operating expenses exclusive of depreciation and amortization. (1) Total operating revenue and contributions/transfers 180

ATTACHMENT A
Less: Net Debt
Fiscal Gross Operating Available Debt Service Coverage
Year Revenues (1) Expenses (2) Revenue Principal Interest Total Ratio Wastewater Certificates of Participation
2022 82,041$ 51,194$ 30,847$ 4,195$ 3,500$ 7,695$ 4.01 2021 80,221$ 43,795$ 36,426$ 3,995$ 2,497$ 6,492$ 5.61 2020 82,314$ 47,956$ 34,358$ 3,795$ 3,701$ 7,496$ 4.58 2019 70,849$ 42,197$ 28,652$ 3,635$ 2,860$ 6,495$ 4.41 2018 70,938$ 41,977$ 28,961$ 3,490$ 3,002$ 6,492$ 4.46 2017 68,597$ 43,201$ 25,396$ 3,345$ 3,139$ 6,484$ 3.92 2016 70,532$ 43,730$ 26,802$ 3,230$ 3,254$ 6,484$ 4.13 2015 57,321$ 39,698$ 17,623$ 3,390$ 3,217$ 6,607$ 2.67 2014 61,230$ 40,173$ 21,057$ 3,230$ 4,143$ 7,373$ 2.86 2013 56,316$ 35,423$ 20,893$ 3,090$ 4,287$ 7,377$ 2.83 (Continued)
Source: City of Stockton Department of Administrative Services Includes all nongeneral obligation long term debt backed by pledged revenues.

Details regarding the City's outstanding debt can be found in the Note 8 - Long-Term Debt of these financial statements. (2) Total operating expenses exclusive of depreciation and amortization. (Dollars amounts in thousands)
(1) Total operating revenue and contributions/transfers City of Stockton
Table 16
Pledged-Revenue Coverage (Continued)
Last Ten Fiscal Years
181

ATTACHMENT A
Less: Net Debt
Fiscal Gross Operating Available Debt Service Coverage
Year Revenues (1) Expenses (2) Revenue Principal Interest Total Ratio Parking Authority
2022 4,307$ 3,470$ 837$ 245$ 1,174$ 1,419$ 0.59 2021 4,628$ 3,007$ 1,621$ 1,194$ 1,194$ 1.36 (2) Total operating expenses exclusive of depreciation and amortization. (Concluded)
(1 )Includes all nongeneral obligation long term debt backed by pledged revenues. Please note that principal and interest for an internal loan subordinated to the 2020 Parking Revenue Bonds is not included. Had payments for that loan been included, coverage would have been 0.81 Details regarding the City's outstanding debt can be found in the Note 8 - Long-Term Debt of these financial statements.

Source: City of Stockton Department of Administrative Services City of Stockton
Table 16
Pledged-Revenue Coverage (Continued)
Last Ten Fiscal Years
(Dollars amounts in thousands)
182

ATTACHMENT A
Fiscal
Year Population
Personal
Income
(millions
of dollars)
Per
Capita
Personal
Income
Labor Force
(1)
Total
Housing
Units
Household
Average
Size
Median
Family
Income
School
Enrollment
2022 322,489 16,710 $ 51,816 $ 5.9 % 131,200 103,318 3.15 58,393 $ 105,335 2021 320,804 15,122 $ 47,139 $ 10.3 % 132,463 101,960 3.25 54,614 $ 98,646 2020 318,522 16,346 $ 51,318 $ 13.1 % 130,300 101,235 3.26 51,318 $ 101,162 2019 316,410 13,549 $ 42,822 $ 7.0 % 129,000 100,877 3.39 48,396 $ 105,705 2018 315,103 12,748 $ 40,458 $ 6.3 % 134,500 100,593 3.15 46,033 $ 99,347 2017 320,554 12,428 $ 38,770 $ 7.3 % 127,000 100,254 3.23 44,797 $ 71,491 2016 315,592 11,404 $ 36,136 $ 8.3 % 127,900 100,146 3.20 45,347 $ 71,738 2015 306,999 10,670 $ 34,755 $ 8.5 % 127,000 100,097 3.23 46,831 $ 66,037 2014 300,899 9,937 $ 33,024 $ 12.8 % 125,600 100,025 3.23 47,246 $ 69,183 2013 296,344 9,191 $ 31,013 $ 14.8 % 124,800 100,003 3.20 47,246 $ 67,997 Sources: City of Stockton Department of Administrative Services & Community Development Department CA Dept. of Finance and Employment Development Department US Dept. of Commerce, Bureau of Economic Analysis
US Census Bureau
CA Dept. of Education
Unemployment
Rate
Personal
income is the income received by all persons from all sources. Personal income is the sum of net earnings by place of residence, rental income of persons, personal dividend income, personal interest income, and personal current transfer receipts.

Per capita personal income is calculated as the personal income of residents of a given area divided by the resident population of the area. In computing per capita personal income, Bureau of Economic Analysis uses the Census Bureau's annual midyear population estimates.

City of Stockton
Table 17
Demographic and Economic Statistics
Last Ten Fiscal Years
(1) Labor Force corrected for FY 15, FY 16, FY 17 which reported previously as San Joaquin County labor force , corrected to State, the City of Stockton labor force only.
183

ATTACHMENT A
Percent
of Total City
Employer Employees Rank Employees Rank Employment
Stockton Unified School District 5,265 1 4.04% 3,366 3 2.70% Amazon 4,750 2 3.65%
St. Joseph’s Medical Center 3,200 3 2.46% 4,600 2 3.69% City of Stockton 2,118 4 1.63% 1,862 4 1.49% San Joaquin County Office of Education 1,955 5 1.50% 4,720 1 3.78% Pacific Gas and Electric 1,550 6 1.19% 1,100 6 0.88% University of the Pacific 1,329 7 1.02% 900 9 0.72% Lincoln Unified School District 1,125 8 0.86% 631 10 0.51% Kaiser Permanente 1,065 9 0.82% 1,065 7 0.85% San Joaquin Delta College 813 10 0.62% 1,000 8 0.80% Dameron Hospital 0.00% 1,200 5 0.96%
Total 23,170 17.78% 20,444 16.38%
Sources: San Joaquin Partnership Survey, August 2022
City of Stockton ACFR, 2013
Employment
2013
City of Stockton
Table 18
Principal Employers
Current Year and Ten Years Ago
2022
Note: Principal employers are based on best available information.

Percent
of Total City
184

ATTACHMENT A
2022 2021 2020 2019 2018
Function/Program/Department:

Admin Svcs 73 78 74 73 74
City Attorney 9 10 12 10 11
City Clerk 7775 6
City Council/Mayor 4343 3
City Manager 32 30 26 28 28
Community Development 42 40 42 38 32
Community Services 102 101 101 98 101
Human Resources 30 22 32 25 27
Information Technology 37 39 41 40 41
Police:

Sworn 405 433 432 469 470
Non-sworn 175 189 216 193 193
Animal control 6 11 12 11 12
Total Police 586 633 660 673 675
Fire:

Firefighters-sworn 165 171 160 177 169
Firefighters-auxiliary 41 0 21 32 20
Non-sworn personnel 34 34 32 30 25
Total Fire 240 205 213 239 214
Public Works 140 135 135 141 142
Economic Development 20 20 18 17 17
Water Utility 47 48 47 47 44
Wastewater Utility 147 147 142 144 145
Stormwater Utility 3544 3
Total 1519 1523 1558 1585 1,563
*Auxiliary fire fighter program on hold due to COVID-19 *Non-Sworn includes Police Officer Trainees
Source: City of Stockton Human Resources Department
City of Stockton
Table 19
Full-Time Equivalent City Government Employees
By Function/Program/Department
Last Five Fiscal Years
Fiscal Year
185

ATTACHMENT A
2022 2021 2020 2019 2018
General government:

Building permits issued 7,714 8,815 7,378 7,380 7,538 Business tax certificates:

Retail sales and service 5,109 6,434 7,805 5,707 4,786 Rental Properties - Commercial and Residential 2,495 4,267 4,491 4,165 4,062 Wholesale 319 443 393 404 387 Manufacturers and processors 121 152 149 159 139 Professions 1,289 1,760 1,561 1,614 1,614 Miscellaneous contractors, peddlers, delivery vehicles, etc. 5,219 5,640 4,900 4,579 6,419 Improvement district and hotel/motel room tax 40
Utility billing/customer service:

Utility bills issued 1,040,607 1,186,454 1,000,452 1,051,220 1,169,160 Utility accounts opened and closed 19,933 46,905 17,582 20,818 23,828 New service locations (water) added 411 378 283 245 185 Delinquency Notices Sent - Active Accounts - - 75,687 82,303 82,660 Water Service Terminated for Non-Payment - - 3,055 4,989 4,921 Utility customer service calls received 59,951 49,999 45,231 54,695 54,613 Utility customers using automated voice response 678,091 802,378 709,134 849,706 895,369 Utility Customers Using Online Pmt/Account Access 32,850 44,467 32,852 32,893 32,960 Miscellaneous accounts receivable bills issued 10,005 14,770 14,024 37,057 35,880 Public safety:

Police:

Major reported crimes 12,250 12,548
15,654 17,233 15,613
Total arrests 12,915 8,272 11,152 10,945 11,543 Dispatched calls for service 204,270 207,355 176,311 183,834 186,795 Fire:

Interior structure fire calls 332 293 398 364 338 Non-structural fire calls 2,616 3,895 5,719 3,254 3,022 Hazardous materials calls 252 301 593 331 259 Emergency medical calls 19,557 18,485 34,287 26,129 27,105 Total emergency calls 46,756 51,515 57,396 51,613 47,179 Total number of units dispatched 57,198 54,470 60,162 61,026 50,614 Public works:

Miles of streets resurfaced 26 22 28 7 6 Fleet job orders completed 5,725 6,617 7,764 8,765 9,937 City of Stockton
Table 20
Operating Indicators by Function/Program/Department
Last Five Fiscal Years
Fiscal Year
186

ATTACHMENT A
2022 2021 2020 2019 2018
Library:

Registered borrowers 145,990 155,999 152,726 175,374 197,830 Circulation of library materials 1,021,233 576,605 943,196 1,356,142 1,359,790 Reference, research and informational questions answered 61,020 43,122 70,583 104,670 143,396 Annual attendance at libraries 425,695 120,679 578,193 793,255 761,815 Number of programs offered 1,719 246 3,110 4,416 4,171 Annual attendance at programs 38,640 5,831 60,066 94,216 92,521 Parks and Recreation:

Golf rounds:

Swenson Park golf course 59,076 79,968 65,489 50,290 52,502 Van Buskirk golf course - 1,904 9,990 13,765 Trees planted 106 20 3 7 10 Heritage tree removal-permits issued - 9 5 - After school program registration (number of participants) 11,558 471 16,153 21,728 14,382 Day camp participants 2,703 444 2,753 3,685 5,062 Instructional classes 2,036 - 1,781 2,986 6,569 Softball/baseball diamonds bookings 169 41 142 147 142 Showmobile (Mobile Stage) bookings 15 1 15 17 14 Community center bookings 423 - 636 635 1,029 Picnic facility bookings 305 7 172 306 272 Adult sports (number of teams):

Softball 153
45 57 101 191 Basketball 63 - 16 23 5 Volleyball 9 - - - 6 Youth sports (basketball, track, soccer, baseball, volleyball, flag football) (number of participants) 1,397 375 1,351 2,997 2,920 City of Stockton
Table 20
Operating Indicators by Function/Program/Department (Continued) Last Five Fiscal Years
Fiscal Year
187

ATTACHMENT A
2022 2021 2020 2019 2018
Parks and Recreation (Cont.):

Admissions to:

Pixie Woods 14,235 973 8,995 15,480 13,000 Senior Center memberships 1,131 - 1,075 615 744 Civic Auditorium bookings 120 66 116 133 228 Parks and Recreation sponsored events 5 1 15 22 10 Weber Point Events Center bookings 16 1 15 15 20 Economic Development: (1)
Rental Housing Units 105 - 127 51 - Owner Housing (Emergency Repair or Rehabilitation) 1 2 2 5 2 Down Payment Assistance - - - 3 - Special Needs (Homes Repaired or Rehabilitated) - - - 2 5 Public Facilities (Rehabilitated or Constructed) 1 - 5 1 2 Façade Program (Commercial Façade Repair/Rehabilitated) 1 2 2 1 5 Public Services Provided 712 83,553 47,605 23,760 129,584 Homeless Services Provided 7,040 4,806 5,413 4,859 4,464 Meals Provided to Homeless 249,455 126,408 41,882 39,848 23,541 Jobs Created and/or Retained - 1 2 - 5 Business Assisted (Entrepreneur Program) 175 157 229 292 475 Water utility:

New connections (DUE's) (2) 473 589 105 221 422
Water main breaks 26 18 15 21 15
Wastewater utility:

Average daily influent (million gallons per day) 25mgd 25mgd 27 mgd 30 mgd 30 mgd Source: City of Stockton Departments
City of Stockton
Table 20
Operating Indicators by Function/Program/Department (Continued) Last Five Fiscal Years
Fiscal Year
(1) Housing Dept. was abolished and Economic Development Dept. was established in FY 2010. (2) Changed reporting to Dwelling Unit Equivalent (DUE) in 2011 to more accurately reflect new connections. Not all single water connections are equal to one dwelling unit equivalent (DUE), or single family residence. For example, a 12" meter is equal to 209 single family residential connections. In 2011, there were 115 new connections which were equal to 654 DUE's. 188

ATTACHMENT A
2022 2021 2020 2019 2018
General government:

Land use-square miles:

Residential 22 24 25 25 25
Mixed use 4444 4
Commercial 5444 4
Industrial 13 14 13 13 13
Institutional 6444 4
All other uses 4333 3
Total square miles 54 53 53 53 53
Public safety:

Police:

Facilities:

Stations and substations 1111 1
Animal control facility 1111 1
Police training facility (pistol range) 1111 1
Vehicles:

Marked patrol cars 153 181 212 192 217
Motorcycles and scooters 27 27 27 32 30
Animal control vehicles 12 11 9 8 8
VIPS vehicles 6567 7
Other automobiles 158 198 213 231 208
Other mobile units (all others) 24 24 15 22 22
Public area security cameras 372 356 356 345 338
Fire:

Fire stations 12 12 12 12 12
Training facilities 1111 1
Fire hydrants 9302 9220 9177 9218 9,080
Public works:

Miles of streets 781 781 769 769 769
Traffic signals 317 316 316 310 307
Street light fixtures 19,296 19,279 19,279 19,208 19,137 City of Stockton
Table 21
Capital Asset Statistics by Function/Program/Department Last Five Fiscal Years
Fiscal Year
189

ATTACHMENT A
2022 2021 2020 2019 2018
Parks and recreation:

Arena 1111 1
Ballpark 1111 1
Baseball/softball diamonds 54 54 54 54 54
Bike/jogging paths (miles) 20 20 20 20 20
Boating facilities - launch lanes 12 12 12 12 12
Children's Museum 1111 1
Civic Auditorium (2,800 capacity) 1111 1
Community centers 5555 5
Dog Areas 3333 3
Family camps 1111 1
Golf course acreage 371 371 371 371 371
Group picnic areas 31 31 31 31 31
Gymnasium 5555 5
Ice rink 1111 1
Municipal golf courses 2333 3
Park acreage 625 625 625 625 625
Parks and squares 67 67 67 67 67
Philomathean Club 1111 1
Playgrounds 63 63 71 71 71
Senior center 1111 1
Showmobile (Mobile Stage) 1111 1
Skateboard park 1111 1
Swimming pools 7777 7
Teen Center 1111 1
Tennis courts 67 67 67 67 67
Theater (Bob Hope) 1111 1
Weber Point Events Center 1111 1
Consolidated landscape maintenance districts:

Streetscaping (square feet) 3.6 million 3.6 million 3.6 million 3.6 million 3.6 million Public open spaces (acreage) 70 70 70 70 70
City of Stockton
Table 21
Capital Asset Statistics by Function/Program/Department (Continued) Last Five Fiscal Years
Fiscal Year
190

ATTACHMENT A
2022 2021 2020 2019 2018
Library:

City branches 8 8 8 7 6 Library mobile units 2 2 2 2 2 San Joaquin County branches 8 8 8 8 8 Total items in collection 655,305 704,864 875,434 772,206 856,101 Cargo delivery van 2 2 2 2 2 Cargo van 1 1 1 1 1 Undeveloped land for branch library 2 2 2 2 2 Integrated library system 1 1 1 1 1 Microform readers - 7 7 7 Microform readers/printers 6 6 7 7 7 Self check out machines 21 21 22 24 28 Water utility:

Water main lines (miles) 702 702 702 668 668 Storage capacity (thousand gallons) 26,200 26,200 26,200 26,200 26,200 Water wells (active) 19 20 20 20 21 Water reservoirs 8 8 8 8 8 Wastewater utility:

Wastewater main lines (miles) 921 919 887 883 899 Treatment capacity (million gals/day) 55 55 55 55 55 Wastewater pump stations 28
28 27 27 27 Stormwater utility:

Stormwater main drain lines (miles) 628 627 627 626 626 Stormwater pump stations 75 73 73 73 74 Parking Authority:

Parking spaces 5,179 5,440 5,440 5,440 5,396 Parking lots & garages 21 21 21 21 20
City of Stockton
Source: City of Stockton Departments
Capital Asset Statistics by Function/Program/Department (Continued) Last Five Fiscal Years
Fiscal Year
Table 21
191

ATTACHMENT A
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192

ATTACHMENT A