Taft City Council
November 19, 2024

TAFT CITY COUNCIL/SUCCESSOR AGENCY

JOINT REGULAR MEETING AGENDA
TUESDAY NOVEMBER 19, 2024

CITY HALL COUNCIL CHAMBER
209 E. KERN ST., TAFT, CA 93268
_____________________________________________________________________________________________________________________________ City of Taft Council Meetings are being held in-person with full capacity seating and are livestreamed at https://www.youtube.com/user/CityofTaft. Public comment can be made in person and also can be received per the following:
• Written comments may be dropped off in the drop box in front of City Hall. • Comments may be emailed to the City Clerk at [email protected]. • Made by phone to the City Clerk’s office at (661) 763-1222. • Public comments will be accepted up until 5:00 PM the day of the meeting. • Any comments received will be read into the record.
_____________________________________________________________________________________________________________________________ REGULAR MEETING 6:00 P.M.

Pledge of Allegiance
Invocation
Roll Call: Mayor Noerr
Mayor Pro Tem Krier
Councilmember Bryant
Councilmember Waldrop
Councilmember Chavira

1. CITIZEN REQUESTS/PUBLIC COMMENTS

COMMENTS ARE TO BE RECEIVED AS STATED IN ABOVE POLICY

THIS IS THE TIME AND PLACE FOR THE GENERAL PUBLIC TO ADDRESS THE CITY COUNCIL ON MATTERS WITHIN ITS JURISDICTION. STATE LAW PROHIBITS THE COUNCIL FROM ADDRESSING ANY ISSUE NOT PREVIOUSLY INCLUDED ON THE AGENDA. COUNCIL MAY RECEIVE COMMENT AND SET THE MATTER FOR A SUBSEQUENT MEETING. PLEASE LIMIT COMMENTS TO FIVE MINUTES.

2. PLANNING COMMISSION REPORT

3. COUNCIL STATEMENTS (NON-ACTION)

4. DEPARTMENT REPORTS

5. CITY MANAGER STATEMENTS

6. CITY ATTORNEY STATEMENTS

7. FUTURE AGENDA REQUESTS
****************************************************************************************************** CONSENT CALENDAR ITEMS 8-12
All items listed on the Consent Calendar shall be considered routine and will be enacted by one roll call vote. There will be no separate discussion of these items unless a member of the City Council requests specific items to be removed from the Consent Calendar for separate action. Any item removed from the Consent Calendar will be considered after the regular business items. Are there any items on the consent calendar that any member of the public would like to comment on? City of Taft Council/Successor Agency Meeting
Agenda
November 19, 2024

8. MINUTES
November 5, 2024, Regular
Recommendation – Approve as submitted.

9. PAYMENT OF BILLS
Warrant # 110824 Check No. 100712-100761 $ 524,541.74
Warrant # 110824 Check No. 100762-100764 $ 9,974.32
Warrant # 11524 Check No. 100765-100790 $ 114,034.21
Recommendation – Approve payment of the bills.

10. MONTHLY REPORT FOR KERN COUNTY FIRE STATION NO. 21 - OCTOBER 2024 Recommendation - Receive and file the monthly report for October 2024 from Kern County Fire Station No. 21 and find that the activity is not a project per the California Environmental Quality Act (CEQA) as set forth in Section 15060(c)(3) and Section 15378 of the CEQA Guidelines.

11. ANNUAL AUDITED FINANCIAL STATEMENTS FOR FY2016-2017 Recommendation - Motion to receive and file the Annual Audited Comprehensive Financial Reports for the year ended June 30, 2017 and Find that the activity is not a project per the California Environmental Quality Act (CEQA) as set forth in Section 15060(c)(3) and Section 15378 of the CEQA Guidelines.

12. ANNUAL AUDITED FINANCIAL STATEMENTS FOR FY2019-2020 Recommendation - Motion to receive and file the Annual Audited Comprehensive Financial Reports for the year ended June 30, 2020 and find that the activity is not a project per the California Environmental Quality Act (CEQA) as set forth in Section 15060(c)(3) and Section 15378 of the CEQA Guidelines.
******************************************************************************************************

13. 2ND READING AND ADOPTION OF ORDINANCE AUTHORIZING AN AMENDMENT TO THE CONTRACT BETWEEN THE CITY OF TAFT AND THE CALIFORNIA PUBLIC EMPLOYEES’

RETIREMENT SYSTEM
Recommendation - Motion to approve and amend the City of Taft Municipal Code and adopt an Ordinance entitled AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TAFT ADDING SECTION 1-7-6 TO CHAPTER 7 OF TITLE 1 AUTHORIZING AN AMENDMENT TO THE CONTRACT

BETWEEN THE CITY COUNCIL OF THE CITY OF TAFT AND THE BOARD OF ADMINISTRATION OF THE CALIFORNIA PUBLIC EMPLOYEES’ RETIREMENT SYSTEM and find that the activity is not a project per the California Environmental Quality Act (CEQA) as set forth in Section 15060(c)(3) and Section 15378 of the CEQA Guidelines.

CLOSED SESSION
A. CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATION (1 undisclosed case) Government Code Section 54956.9(b)

ADJOURNMENT
City of Taft Council/Successor Agency Meeting
Agenda
November 19, 2024

AMERICANS WITH DISABILITIES ACT: In compliance with the Americans with Disabilities Act, if you need special assistance, a disability-related modification or accommodation, agenda materials in an alternative format, or auxiliary aids to participate in this meeting, please contact the Office of the City Clerk at (661) 763-1222 or [email protected] as soon as possible.

Providing at least 72 hours’ notice will help ensure that reasonable arrangements can be made.

AFFIDAVIT OF POSTING
I, Yvette Mayfield, declare as follows:

That I am the City Clerk for the City of Taft; that an agenda was posted on a public information bulletin board located near the door of the Civic Center Council Chamber on November 14, 2024, at _______ a.m./p.m., pursuant to 1987 Brown Act Requirements.

I declare under penalty of perjury that the foregoing is true and correct.

Executed November 14, 2024, at Taft, California.

Signature __________________

TAFT CITY COUNCIL/SUCCESSOR AGENCY

MINUTES
NOVEMBER 5, 2024
The November 5, 2024, regular joint meeting of the Taft City Council/Taft Successor Agency, held in the Council Chamber at Taft City Hall, 209 East Kern Street, Taft, CA 93268, was opened by Mayor Dave Noerr at 6:00 PM. The Pledge of Allegiance was led by Mayor Dave Noerr, and invocation was given by Pastor John Getty.

PRESENT: Mayor Noerr and Mayor Pro Tem Orchel Krier
Council Members Josh Bryant, Carlos Chavira and Ron Waldrop City Manager Craig Jones and City Attorney Jason Epperson City Clerk Yvette Mayfield

1. CIVICA LAW GROUP PRESENTATION
• CALIFORNIA CARE COURT
• LEGISLATIVE UPDATES
• LOCAL CODE AMENDMENTS

2. PUBLIC HEARING – TO RECEIVE PUBLIC INPUT IN CONSIDERATION OF ADOPTION OF

ORDINANCE AUTHORIZING AN AMENDMENT TO THE CONTRACT BETWEEN THE CITY OF TAFT AND THE CALIFORNIA PUBLIC EMPLOYEES’ RETIREMENT SYSTEM The public hearing was opened at 6:31 PM to receive comment, having none the hearing was closed.

Motion: Moved by Bryant, seconded by Krier to approve and amend the City of Taft Municipal Code and adopt an Ordinance entitled AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TAFT ADDING SECTION 1-7-6 TO CHAPTER 7 OF TITLE 1 AUTHORIZING AN AMENDMENT TO THE

CONTRACT BETWEEN THE CITY COUNCIL OF THE CITY OF TAFT AND

THE BOARD OF ADMINISTRATION OF THE CALIFORNIA PUBLIC
EMPLOYEES’ RETIREMENT SYSTEM for first reading by title only and reading of such be waived.

AYES: Krier, Bryant, Waldrop, Chavira, Noerr
PASSED: 5-0

3. CITIZEN REQUESTS/PUBLIC COMMENTS
Dr. Kathy Orrin, Executive Director of the Taft Chamber of Commerce, thanked the Council and City Staff for all the support shown for the Chamber and introduced new employee, Mallory Burrell, who shared about upcoming events.

4. COUNCIL STATEMENTS (NON-ACTION)
Council Member Waldrop shared that he hoped everyone would take the opportunity to vote.

Council Member Bryant reminded everyone that people have fought and died for their right to vote, and he hopes that everyone will get informed and vote. He also invited everyone to the Veteran’s Day Celebration.

City of Taft Council/Successor Agency Meeting
Minutes
November 5, 2024

Council Member Chavira spoke about the importance of being educated and voting, sharing a couple of relevant quotes.

Mayor Pro Tem Krier talked about Veterans and the right to vote and reminded everyone that the holidays are coming up.

Mayor Noerr recognized a couple of young attendees who were attending as a part of research for their government class and reminded voters that in order to be able to vote you have to be an adult and therefore should act like one regardless of the vote outcome.

5. DEPARTMENT REPORTS
Chief of Police, Damon McMinn, shared about their newest member of the Department, as Officer Dewar recently gave birth to a baby girl and shared the October statistics for the Department.

6. CITY MANAGER STATEMENTS
There was none.

7. CITY ATTORNEY STATEMENTS
There was none.

8. FUTURE AGENDA REQUESTS
Council Member Bryant requested a proclamation for the Kiwanis Clubs 100th anniversary receiving unanimous concurrence from Council.
********************************************************************************************* CONSENT CALENDAR ITEMS 9-13
Motion: Moved by Krier, seconded by Bryant to approve consent calendar items 9-13.

AYES: Bryant, Chavira, Waldrop, Chavira, Krier
PASSED: 5-0

9. MINUTES
October 15, 2024, Regular
Recommendation – Approve as submitted.

10. PAYMENT OF BILLS
Warrant #091324A Check No. 100565-100566 $ 46,388.76
Warrant #100424 Check No. 100567-100587 $ 86,610.08
Warrant #101124 Check No. 100588-100642 $ 170,940.13
Warrant #102524 Check No. 100643-100710 $ 573,312.16
Warrant #102424 Check No. 100711 $ 164,362.00
Recommendation – Approve payment of the bills.

City of Taft Council/Successor Agency Meeting
Minutes
November 5, 2024

11. COUNTY OF KERN – TRANSPORTATION SERVICES AGREEMENT AMENDMENT NO. 2 Recommendation - Motion to authorize the Mayor to execute Amendment No. 2 of the Kern County Transportation Services Agreement and find that the activity is not a project per the California Environmental Quality Act (CEQA) as set forth in Section 15060(c)(3) and Section 15378 of the CEQA Guidelines.

12. AWARD OF CONSULTANT CONTRACT AGREEMENT TO BHT ENGINEERING, INC. FOR ONCALL ENGINEERING SERVICES FOR FEDERAL AND STATE FUNDED PROJECTS Recommendation - Motion to approve award of consultant contract to BHT Engineering, Inc. for On-Call Engineering Services for Federal and State Funded Projects, voiding of the previous contract and authorizing the Mayor to sign and find that the activity is not a project per the California Environmental Quality Act (CEQA) as set forth in Section 15060(c)(3) and Section 15378 of the CEQA Guidelines.

13. PROFESSIONAL SERVICES AGREEMENT WITH GB-TRANSLATIONS FOR ON-CALL

INTERPRETER AND TRANSLATION SERVICES
Recommendation - Motion to approve the professional services agreement between the City of Taft and GB-Translations, authorize the Mayor to execute said agreement and find that the activity is not a project per the California Environmental Quality Act (CEQA) as set forth in Section 15060(c)(3) and Section 15378 of the CEQA Guidelines. ********************************************************************************************* At 7:04 PM the regular meeting was recessed to closed session and adjourned in honor and memory of Michael “Mike” Lahargoue.

CLOSED SESSION
A. CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATION (1 undisclosed case) Government Code Section 54956.9(b)
 The City Council discussed in closed session those items agendized for closed session discussion and directions were given to negotiators and staff. No other reportable action was taken.

ADJOURNMENT - With no further business to conduct the meeting was adjourned at 7:48 PM. __________ ____________
Yvette Mayfield, MMC Dave Noerr
City Clerk Mayor

REVIEWED BY:

CITY CLERK FINANCE DIRECTOR CITY MANAGER
City of Taft Agenda Report
DATE: NOVEMBER 19, 2024
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:

MONTHLY REPORT FOR KERN COUNTY FIRE STATION NO. 21 - OCTOBER 2024 SUMMARY STATEMENT:

Kern County Fire provides a monthly report for Station No. 21 in the Taft area. This report is being provided to Council for informational purposes only and to be received and filed.

This chart below was provided to show the total number of emergency calls and number of fires for October 2024. You will notice that this report is for not only the calls responded to within the city limits but reports everything within the greater Taft area that Station 21 covers.

Station 21
2024
Month # of calls # of fires
January 182 16
February 205 19
March 198 26
April 204 13
May 222 45
June 253 29
July 264 40
August 226 32
September 195 17
October 261 14

RECOMMENDED ACTION
Receive and file the monthly report for October 2024 from Kern County Fire Station No. 21 and find that the activity is not a project per the California Environmental Quality Act (CEQA) as set forth in Section 15060(c)(3) and Section 15378 of the CEQA Guidelines.

IMPACT ON BUDGET (Y/N): No
ATTACHMENT (Y/N): Report
PREPARED BY: City Manager
Kern County Fire Engine_Truck 21 Taft Monthly Report
Incident
Date
Incident
Time
Apparatus
ID
Incident Code Address
Incident Category: (None)
10/27/2024 09:10:52 E21 329 D Street and 4TH AVE / 3RD AVE TK21 329 D Street and 4TH AVE / 3RD AVE
Count: 2
Incident Category: 1 - Fire
10/23/2024 04:21:33 E21 131 - Passenger vehicle fire 301 WOODROW Street and 3RD ST / 4TH ST 10/27/2024 19:22:00 E21 131 - Passenger vehicle fire Cherry/Acacia and DEAD END / CYPRESS ST 10/14/2024 22:59:42 E21 140 - Natural vegetation fire, other 28700 HOVEY HILLS Road and SOUTH ST, TWENTY FIVE HILL RD,

OLIVE AVE / TWENTY
10/08/2024 22:09:08 E21 142 - Brush or brush-and-grass mixture fire 717 TAYLOR Street and DEAD END / FILLMORE ST, HAWTHORNE ST
10/11/2024 22:42:02 E21 142 - Brush or brush-and-grass mixture fire 1131 KERN Street and HILLARD ST / CASCADE PL 10/21/2024 02:04:17 E21 142 - Brush or brush-and-grass mixture fire MIDWAY RD / 119 Highway and 119 HWY, MIDWAY RD / ELK HILLS RD, 119 HWY
10/25/2024 16:40:10 E21 142 - Brush or brush-and-grass mixture fire Petroleum Club and WOOD ST, 33 HWY, PETROLEUM CLUB RD /

CADET RD, PET
10/30/2024 19:45:24 E21 142 - Brush or brush-and-grass mixture fire Midway and MIDWAY RD, N LINCOLN ST / 119 HWY 10/05/2024 10:48:57 E21 143 - Grass fire Hwy 33 and TWENTYONE CANYON RD, 33 HWY / 33 HWY, HENRY RD
10/06/2024 22:53:33 E21 143 - Grass fire HILL and DEAD END / SOUTH ST, LIERLY AVE 10/02/2024 13:40:41 E21 151 - Outside rubbish, trash or waste fire 119 HWY / GARDNER FIELD Road TK21 151 - Outside rubbish, trash or waste fire 119 HWY / GARDNER FIELD Road 10/09/2024 12:32:23 E21 151 - Outside rubbish, trash or waste fire KERN ST / HILLARD Street 10/29/2024 15:14:59 E21 151 - Outside rubbish, trash or waste fire 119 HWY / 2ND Street Count: 14
Incident Category: 3 - Rescue & Emergency Medical Service Incident 10/05/2024 12:10:53 E21 311 - Medical assist, assist EMS crew 714 FILLMORE Street and HAWTHORNE ST / GREVILLEA ST 18:48:15 E21 311 - Medical assist, assist EMS crew 28126 LAKE TERRACE Avenue and DEAD END / TURBO ST 22:33:22 E21 311 - Medical assist, assist EMS crew 28126 LAKE TERRACE Avenue and DEAD END / TURBO ST 10/06/2024 14:33:00 E21 311 - Medical assist, assist EMS crew HONOLULU RD / AIRPORT Road 10/07/2024 06:21:26 E21 311 - Medical assist, assist EMS crew 121 ASHER Avenue and ASHER WAY / PICO ST, 4TH ST 13:20:25 E21 311 - Medical assist, assist EMS crew 116 North LINCOLN Street and BIRCH ST / N 10TH ST, W ASH ST,

MAIN ST, ASH ST
22:57:11 E21 311 - Medical assist, assist EMS crew 101 East KERN Street and BELL AVE / 1ST ST, KERN ST, ADKISSON WAY
10/08/2024 04:07:13 E21 311 - Medical assist, assist EMS crew 304 SUNSET Lane and WOODLAWN AVE / FRANKLIN AVE 10/10/2024 12:17:37 E21 311 - Medical assist, assist EMS crew 203 East WOODROW Street and BELL AVE / WILLIAMS WAY 10/11/2024 06:20:36 E21 311 - Medical assist, assist EMS crew 703 NORTH Street and 7TH ST / 8TH ST 09:40:36 E21 311 - Medical assist, assist EMS crew 28144 COSWORTH Avenue and TURBO ST / OLIVAREZ ST 22:16:20 E21 311 - Medical assist, assist EMS crew 206 MONTVIEW Avenue and PICO ST / CRYSTAL ST 10/13/2024 04:27:01 E21 311 - Medical assist, assist EMS crew 715 HARRISON Street and DEAD END / GREVILLEA ST 15:54:07 TK21 311 - Medical assist, assist EMS crew 17735 COPUS Road and SATTAR WAY / BASIC SCHOOL RD 10/14/2024 21:22:45 E21 311 - Medical assist, assist EMS crew 322 South 8TH Street and HOPE ST / FRONT ST 10/15/2024 14:51:48 E21 311 - Medical assist, assist EMS crew 300 North LINCOLN Street and CEDAR ST / DATE ST 10/17/2024 00:54:46 E21 311 - Medical assist, assist EMS crew 28149 MC CLAREN Avenue and DEAD END / OLIVAREZ ST TK21 311 - Medical assist, assist EMS crew 28149 MC CLAREN Avenue and DEAD END / OLIVAREZ ST 10/18/2024 04:11:28 E21 311 - Medical assist, assist EMS crew 903 WILLIAMS Way and E CALVIN ST / 2ND ST 10/19/2024 06:32:08 E21 311 - Medical assist, assist EMS crew 311 South 10TH Street and FRONT ST / HOPE ST 09:20:58 E21 311 - Medical assist, assist EMS crew 319 NAYLOR Avenue and WOOD ST / CRYSTAL ST 23:46:01 E21 311 - Medical assist, assist EMS crew 531 WARREN Street and 6TH ST / 5TH ST 10/21/2024 08:40:07 E21 311 - Medical assist, assist EMS crew 309 South 10TH Street and FRONT ST / HOPE ST TK21 311 - Medical assist, assist EMS crew 309 South 10TH Street and FRONT ST / HOPE ST 1 of 8 Printed On: 11/07/2024 10:02:29 AM
Incident
Date
Incident
Time
Apparatus
ID
Incident Code Address
10/23/2024 06:11:48 TK21 311 - Medical assist, assist EMS crew 123 North 10TH Street and MAIN ST / CENTER ST 22:07:16 E21 311 - Medical assist, assist EMS crew 914 PICO Street and GENERAL PETROLEUM AVE / MONTVIEW AVE 10/24/2024 18:35:14 E21 311 - Medical assist, assist EMS crew 504 WOOD Street and ROSE AVE / NAYLOR AVE 10/25/2024 19:57:07 E21 311 - Medical assist, assist EMS crew 28161 SUNRIDGE Avenue and TURBO ST / RICARDO ST 10/28/2024 20:16:34 E21 311 - Medical assist, assist EMS crew 923 2ND Street and BELL AVE / CALVIN ST, E CALVIN ST 10/29/2024 23:59:57 E21 311 - Medical assist, assist EMS crew 604 GRANT Terrace and VISTA VIA DR / E ST 10/31/2024 09:07:22 E21 311 - Medical assist, assist EMS crew 523 LUCARD Street and 6TH ST / 5TH ST 18:39:11 E21 311 - Medical assist, assist EMS crew 100 TAYLOR Street and COUGAR CT, ASH ST / BIRCH ST 19:55:20 E21 311 - Medical assist, assist EMS crew 100 East NORTH Street and 1ST ST, NORTH ST / E CENTER ST 10/01/2024 02:15:09 E21 320 - Emergency medical service, other 27969 TANK FARM Road and 119 HWY / 119 HWY, DUSTIN ACRES RD
15:39:43 E21 320 - Emergency medical service, other 714 FILLMORE Street and HAWTHORNE ST / GREVILLEA ST 19:33:22 E21 320 - Emergency medical service, other 400 WOODROW Street and 4TH ST / 5TH ST 10/02/2024 01:54:45 E21 320 - Emergency medical service, other 312 SHATTUCK Avenue and CRYSTAL ST / WOOD ST 10/04/2024 16:12:47 E21 320 - Emergency medical service, other 704 FILLMORE Street and GREVILLEA ST / HAWTHORNE ST 10/05/2024 11:00:36 TK21 320 - Emergency medical service, other 401 HARRISON Street and DATE ST / ELM ST 10/06/2024 02:41:55 E21 320 - Emergency medical service, other 27969 TANK FARM Road and 119 HWY / 119 HWY, DUSTIN ACRES RD
10/07/2024 15:17:39 TK21 320 - Emergency medical service, other 531 WARREN Street and 6TH ST / 5TH ST 20:30:55 E21 320 - Emergency medical service, other 112 East CALVIN Street and BELL AVE / 2ND ST, CALVIN ST 10/10/2024 07:47:44 E21 320 - Emergency medical service, other 701 POLK Street and GREVILLEA ST / DEAD END 18:53:18 E21 320 - Emergency medical service, other 222 KERN Street and 3RD ST / 2ND ST 10/12/2024 23:36:45 E21 320 - Emergency medical service, other 202 ASHER Way and No Cross Streets Found 10/13/2024 12:07:37 E21 320 - Emergency medical service, other 119 HWY / E KERN Street and 119 HWY, E KERN ST / E KERN ST,

GARRATT ST
10/15/2024 05:08:42 E21 320 - Emergency medical service, other 118 ROOSEVELT Place and DEAD END / S 10TH ST 10/16/2024 19:35:20 E21 320 - Emergency medical service, other JACKSON ST / ELM Street 10/17/2024 05:40:42 E21 320 - Emergency medical service, other 519 LIERLY Avenue and SOUTH ST / Q ST 10/18/2024 00:27:56 TK21 320 - Emergency medical service, other 27969 TANK FARM Road and 119 HWY / 119 HWY, DUSTIN ACRES RD
17:41:13 E21 320 - Emergency medical service, other 108 CENTER Street and 1ST ST, E CENTER ST / 2ND ST 10/19/2024 13:30:30 TK21 320 - Emergency medical service, other 205 PIERCE Street and BIRCH ST / CEDAR ST 10/20/2024 09:39:16 E21 320 - Emergency medical service, other 316 East WOODROW Street and LORNA WAY / GARRATT ST 10/21/2024 12:09:54 E21 320 - Emergency medical service, other 523 NAYLOR Avenue and SOUTH ST / BUENA VISTA ST 19:48:37 E21 320 - Emergency medical service, other MAPLE ST / CHERRY Avenue 10/22/2024 00:39:14 E21 320 - Emergency medical service, other 805 FILLMORE Street and HAWTHORNE ST / DEAD END 12:47:13 E21 320 - Emergency medical service, other 420 FINLEY Drive and 4TH ST / 6TH ST 10/25/2024 08:35:21 TK21 320 - Emergency medical service, other 326 LUCARD Street and 4TH ST / 3RD ST 10/29/2024 12:01:43 E21 320 - Emergency medical service, other 312 EASTERN Avenue and CRYSTAL ST / WOOD ST 10/30/2024 16:45:39 E21 320 - Emergency medical service, other 103 East LUCARD Street and 1ST ST, LUCARD ST / BELL AVE 10/31/2024 00:51:48 E21 320 - Emergency medical service, other 309 OLIVE Avenue and CRYSTAL ST / WOOD ST 10/01/2024 05:48:57 E21 321 - EMS call, excluding vehicle accident with injury
328 NAYLOR Avenue and WOOD ST / CRYSTAL ST
16:03:13 E21 321 - EMS call, excluding vehicle accident with injury
312 EASTERN Avenue and CRYSTAL ST / WOOD ST
19:10:11 E21 321 - EMS call, excluding vehicle accident with injury
123 North 10TH Street and MAIN ST / CENTER ST
10/02/2024 08:56:58 E21 321 - EMS call, excluding vehicle accident with injury
314 IRENE Street and DEAD END / STANDARD ST
11:03:16 E21 321 - EMS call, excluding vehicle accident with injury
27170 ESCUDO Avenue and GIBBS ST / COYOTE CT
10/03/2024 15:39:44 E21 321 - EMS call, excluding vehicle accident with injury
503 HARRISON Street and ELM ST / FIR ST
17:42:48 E21 321 - EMS call, excluding vehicle accident with injury
201 SHATTUCK Avenue and PICO ST / CRYSTAL ST
18:51:23 E21 321 - EMS call, excluding vehicle accident with injury
305 D Street and 3RD AVE / 4TH AVE
22:18:22 E21 321 - EMS call, excluding vehicle accident with 219 MADISON Street and CEDAR ST / BIRCH ST 2 of 8 Printed On: 11/07/2024 10:02:29 AM
Incident
Date
Incident
Time
Apparatus
ID
Incident Code Address
injury
10/04/2024 10:38:15 E21 321 - EMS call, excluding vehicle accident with injury
923 2ND Street and BELL AVE / CALVIN ST, E CALVIN ST
12:15:44 E21 321 - EMS call, excluding vehicle accident with injury
307 PARKVIEW Circle and KEENE LN / KEENE LN
10/05/2024 02:50:37 E21 321 - EMS call, excluding vehicle accident with injury
304 SUNSET Lane and WOODLAWN AVE / FRANKLIN AVE
04:28:00 E21 321 - EMS call, excluding vehicle accident with injury
HARRISON ST / CEDAR Street
05:32:03 E21 321 - EMS call, excluding vehicle accident with injury
319 NAYLOR Avenue and WOOD ST / CRYSTAL ST
11:29:43 TK21 321 - EMS call, excluding vehicle accident with injury
404 F Street and 4TH AVE / 5TH AVE
14:06:15 E21 321 - EMS call, excluding vehicle accident with injury
217 East WOODROW Street and WILLIAMS WAY / BELL AVE
21:16:36 E21 321 - EMS call, excluding vehicle accident with injury
504 GRANT Terrace and E ST / VISTA VIA DR
10/06/2024 08:08:29 E21 321 - EMS call, excluding vehicle accident with injury
501 ROSE Avenue and BUENA VISTA ST / SOUTH ST
08:22:04 E21 321 - EMS call, excluding vehicle accident with injury
400 WOODROW Street and 4TH ST / 5TH ST
TK21 321 - EMS call, excluding vehicle accident with
injury
400 WOODROW Street and 4TH ST / 5TH ST
16:14:03 E21 321 - EMS call, excluding vehicle accident with injury
QUAIL CT / PHILIPPINE Street
20:20:56 E21 321 - EMS call, excluding vehicle accident with injury
132 WOOD Street and BUENA VISTA PL, MARICOPA PL / S 10TH ST 21:50:49 E21 321 - EMS call, excluding vehicle accident with injury
311 PHILIPPINE Street and 3RD AVE / 4TH AVE
22:12:59 E21 321 - EMS call, excluding vehicle accident with injury
11337 STROKE CUTTERS Drive and ODYSSY WAY / TITANIUM AVE 10/07/2024 12:40:17 E21 321 - EMS call, excluding vehicle accident with injury
Twenty Five Hill Rd/ Entrance 15B and TWENTY FIVE HILL RD, S 10TH ST, BUENA VISTA PL / S
14:05:13 E21 321 - EMS call, excluding vehicle accident with injury
108 NAYLOR Avenue and OAK ST / PICO ST
17:59:53 E21 321 - EMS call, excluding vehicle accident with injury
304 MONTVIEW Avenue and CRYSTAL ST / WOOD ST
TK21 321 - EMS call, excluding vehicle accident with
injury
304 MONTVIEW Avenue and CRYSTAL ST / WOOD ST
10/08/2024 11:42:39 E21 321 - EMS call, excluding vehicle accident with injury
119 HWY / CHERRY Avenue and AIRPORT RD, 119 HWY / CHERRY AVE, 119 HWY
13:14:45 E21 321 - EMS call, excluding vehicle accident with injury
617 HARRISON Street and FIR ST / GREVILLEA ST
16:30:00 E21 321 - EMS call, excluding vehicle accident with injury
303 North 10TH Street and NORTH ST / KERN ST
10/09/2024 09:44:17 E21 321 - EMS call, excluding vehicle accident with injury
615 TYLER Street and GREVILLEA ST / FIR ST
12:44:20 E21 321 - EMS call, excluding vehicle accident with injury
125 CRYSTAL Street and S 10TH ST / LIERLY AVE
13:30:30 E21 321 - EMS call, excluding vehicle accident with injury
522 WOODROW Street and 5TH ST / 6TH ST
15:03:56 E21 321 - EMS call, excluding vehicle accident with injury
715 KERN Street and 8TH ST / 7TH ST, WILDCAT WAY
10/10/2024 09:21:10 E21 321 - EMS call, excluding vehicle accident with injury
730 PHILIPPINE Street and ARROYO DR / HARDING AVE
10/11/2024 07:31:56 E21 321 - EMS call, excluding vehicle accident with injury
611 POLK Street and GREVILLEA ST / FIR ST
10/12/2024 10:04:50 E21 321 - EMS call, excluding vehicle accident with injury
201 8TH Street and NORTH ST / CENTER ST
10/14/2024 07:13:43 E21 321 - EMS call, excluding vehicle accident with injury
204 D Street and 2ND AVE / 3RD AVE
14:00:27 E21 321 - EMS call, excluding vehicle accident with injury
524 B Street and 5TH AVE / 6TH AVE
10/15/2024 21:29:59 E21 321 - EMS call, excluding vehicle accident with 327 B Street and 4TH AVE / 3RD AVE 3 of 8 Printed On: 11/07/2024 10:02:29 AM
Incident
Date
Incident
Time
Apparatus
ID
Incident Code Address
injury
10/16/2024 22:11:59 E21 321 - EMS call, excluding vehicle accident with injury
326 PHILIPPINE Street and 4TH AVE / 3RD AVE
10/17/2024 10:03:54 E21 321 - EMS call, excluding vehicle accident with injury
530 KERN Street and 6TH ST / 5TH ST
21:50:18 E21 321 - EMS call, excluding vehicle accident with injury
300 North LINCOLN Street and CEDAR ST / DATE ST
23:42:15 E21 321 - EMS call, excluding vehicle accident with injury
201 8TH Street and NORTH ST / CENTER ST
10/18/2024 21:15:37 E21 321 - EMS call, excluding vehicle accident with injury
704 FILLMORE Street and GREVILLEA ST / HAWTHORNE ST
TK21 321 - EMS call, excluding vehicle accident with
injury
704 FILLMORE Street and GREVILLEA ST / HAWTHORNE ST
10/19/2024 12:38:01 E21 321 - EMS call, excluding vehicle accident with injury
701 WILDCAT Way and WOODROW ST / WARREN ST
13:26:04 E21 321 - EMS call, excluding vehicle accident with injury
407 FINLEY Drive and 4TH ST / 6TH ST
16:31:43 E21 321 - EMS call, excluding vehicle accident with injury
422 MC KINLEY Street and LASSEN AVE / ALPINE AVE
16:46:46 E21 321 - EMS call, excluding vehicle accident with injury
403 POLK Street and DATE ST / ELM ST
17:01:55 E21 321 - EMS call, excluding vehicle accident with injury
116 HARRISON Street and BIRCH ST / 6TH ST, ASH ST
TK21 321 - EMS call, excluding vehicle accident with
injury
116 HARRISON Street and BIRCH ST / 6TH ST, ASH ST
10/20/2024 12:13:18 E21 321 - EMS call, excluding vehicle accident with injury
1025 STANDARD Street and CHEVRON PL / W ASH ST
16:53:38 E21 321 - EMS call, excluding vehicle accident with injury
715 HARRISON Street and DEAD END / GREVILLEA ST
21:20:06 E21 321 - EMS call, excluding vehicle accident with injury
322 D Street and 4TH AVE / 3RD AVE
TK21 321 - EMS call, excluding vehicle accident with
injury
322 D Street and 4TH AVE / 3RD AVE
10/21/2024 04:13:41 E21 321 - EMS call, excluding vehicle accident with injury
314 VAN BUREN Street and DATE ST / CEDAR ST
06:27:04 E21 321 - EMS call, excluding vehicle accident with injury
505 E Street and 5TH AVE / 6TH AVE
16:09:16 E21 321 - EMS call, excluding vehicle accident with injury
119 HWY / MIDWAY Road
17:01:33 E21 321 - EMS call, excluding vehicle accident with injury
25 Hill Road and TWENTY FIVE HILL RD, S 10TH ST, BUENA VISTA PL / S
10/22/2024 08:16:11 E21 321 - EMS call, excluding vehicle accident with injury
505 ALPINE Avenue and MC KINLEY ST / CHURCH ST
TK21 321 - EMS call, excluding vehicle accident with
injury
505 ALPINE Avenue and MC KINLEY ST / CHURCH ST
18:26:23 TK21 321 - EMS call, excluding vehicle accident with injury
429 E Street and 5TH AVE / 4TH AVE
20:08:52 TK21 321 - EMS call, excluding vehicle accident with injury
505 ALPINE Avenue and MC KINLEY ST / CHURCH ST
20:51:43 TK21 321 - EMS call, excluding vehicle accident with injury
309 South 8TH Street and HOPE ST / FRONT ST
21:54:51 E21 321 - EMS call, excluding vehicle accident with injury
219 MADISON Street and CEDAR ST / BIRCH ST
10/23/2024 05:50:53 E21 321 - EMS call, excluding vehicle accident with injury
27517 MAPLE Street and CHERRY AVE / ORANGE ST
TK21 321 - EMS call, excluding vehicle accident with
injury
27517 MAPLE Street and CHERRY AVE / ORANGE ST
08:02:55 E21 321 - EMS call, excluding vehicle accident with injury
201 8TH Street and NORTH ST / CENTER ST
13:57:46 E21 321 - EMS call, excluding vehicle accident with injury
216 ROSE Avenue and PICO ST / CRYSTAL ST
10/24/2024 15:52:42 E21 321 - EMS call, excluding vehicle accident with injury
322 South 8TH Street and HOPE ST / FRONT ST
23:54:17 E21 321 - EMS call, excluding vehicle accident with 202 ASHER Way and No Cross Streets Found 4 of 8 Printed On: 11/07/2024 10:02:29 AM
Incident
Date
Incident
Time
Apparatus
ID
Incident Code Address
injury
10/25/2024 00:09:29 E21 321 - EMS call, excluding vehicle accident with injury
505 LIERLY Avenue and BUENA VISTA ST / Q ST
TK21 321 - EMS call, excluding vehicle accident with
injury
505 LIERLY Avenue and BUENA VISTA ST / Q ST
02:07:13 E21 321 - EMS call, excluding vehicle accident with injury
322 South 8TH Street and HOPE ST / FRONT ST
11:14:23 E21 321 - EMS call, excluding vehicle accident with injury
421 MC KINLEY Street and LASSEN AVE / ALPINE AVE
20:31:18 E21 321 - EMS call, excluding vehicle accident with injury
114 ADAMS Street and BIRCH ST / ASH ST, WILLIAMS WAY
10/26/2024 01:11:53 E21 321 - EMS call, excluding vehicle accident with injury
212 B Street and 3RD AVE / 2ND AVE
TK21 321 - EMS call, excluding vehicle accident with
injury
212 B Street and 3RD AVE / 2ND AVE
12:36:57 E21 321 - EMS call, excluding vehicle accident with injury
1045 STANDARD Street and W ASH ST / CHEVRON PL
TK21 321 - EMS call, excluding vehicle accident with
injury
1045 STANDARD Street and W ASH ST / CHEVRON PL
14:01:01 E21 321 - EMS call, excluding vehicle accident with injury
219 MADISON Street and CEDAR ST / BIRCH ST
15:27:20 E21 321 - EMS call, excluding vehicle accident with injury
905 BUENA VISTA Street and GENERAL PETROLEUM AVE /

MONTVIEW AVE
10/27/2024 12:59:43 E21 321 - EMS call, excluding vehicle accident with injury
27957 119 Highway and DUSTIN ACRES RD, TANK FARM RD /

SUNRIDGE AVE
TK21 321 - EMS call, excluding vehicle accident with
injury
27957 119 Highway and DUSTIN ACRES RD, TANK FARM RD /

SUNRIDGE AVE
22:36:34 E21 321 - EMS call, excluding vehicle accident with injury
325 LIERLY Avenue and WOOD ST / CRYSTAL ST
10/29/2024 14:04:07 E21 321 - EMS call, excluding vehicle accident with injury
123 North 10TH Street and MAIN ST / CENTER ST
20:02:20 E21 321 - EMS call, excluding vehicle accident with injury
912 PHILIPPINE Street and QUAIL CT / TERRACE DR
21:43:00 E21 321 - EMS call, excluding vehicle accident with injury
702 TAYLOR Street and GREVILLEA ST / DEAD END
10/30/2024 08:26:57 E21 321 - EMS call, excluding vehicle accident with injury
629 A Street and HARDING AVE / HILLARD ST
09:29:39 E21 321 - EMS call, excluding vehicle accident with injury
513 ALPINE Avenue and SHASTA ST / HILLARD ST
10/31/2024 10:57:53 E21 321 - EMS call, excluding vehicle accident with injury
120 ADAMS Street and BIRCH ST / ASH ST, WILLIAMS WAY
21:00:33 E21 321 - EMS call, excluding vehicle accident with injury
1045 KERN Street and N 10TH ST / CASCADE PL
10/03/2024 19:10:33 E21 322 - Motor vehicle accident with injuries KERN ST / HILLARD Street TK21 322 - Motor vehicle accident with injuries KERN ST / HILLARD Street 10/07/2024 14:52:02 E21 322 - Motor vehicle accident with injuries ASH ST / N LINCOLN Street TK21 322 - Motor vehicle accident with injuries ASH ST / N LINCOLN Street 10/09/2024 12:22:24 E21 322 - Motor vehicle accident with injuries 6 ST / SAN EMIDIO Street 10/10/2024 15:02:40 E21 322 - Motor vehicle accident with injuries Hwy 166 and BRUMMETT WAY, 166 HWY / POSO ST, 166 HWY TK21 322 - Motor vehicle accident with injuries Hwy 166 and BRUMMETT WAY, 166 HWY / POSO ST, 166 HWY 10/16/2024 22:23:07 E21 322 - Motor vehicle accident with injuries WOOD ST / 33 Highway TK21 322 - Motor vehicle accident with injuries WOOD ST / 33 Highway 10/20/2024 13:41:21 E21 322 - Motor vehicle accident with injuries GOLF COURSE RD / IRONBARK Road TK21 322 - Motor vehicle accident with injuries GOLF COURSE RD / IRONBARK Road 10/25/2024 05:49:45 E21 322 - Motor vehicle accident with injuries 129 ASHER Avenue and PICO ST, 4TH ST / ASHER WAY TK21 322 - Motor vehicle accident with injuries 129 ASHER Avenue and PICO ST, 4TH ST / ASHER WAY 10/04/2024 11:36:38 E21 324 - Motor vehicle accident, non-injury AIRPORT RD / E KERN Street 10/16/2024 19:15:44 E21 324 - Motor vehicle accident, non-injury HWY 166, JUST WEST OF PENTLAND Highway TK21 324 - Motor vehicle accident, non-injury HWY 166, JUST WEST OF PENTLAND Highway 10/17/2024 11:01:51 E21 324 - Motor vehicle accident, non-injury 33 Highway and 33 HWY, 58 HWY / 33 HWY, CYMRIC RD TK21 324 - Motor vehicle accident, non-injury 33 Highway and 33 HWY, 58 HWY / 33 HWY, CYMRIC RD 5 of 8 Printed On: 11/07/2024 10:02:29 AM
Incident
Date
Incident
Time
Apparatus
ID
Incident Code Address
10/18/2024 00:22:52 E21 324 - Motor vehicle accident, non-injury 119 HWY / GOLF COURSE Road TK21 324 - Motor vehicle accident, non-injury 119 HWY / GOLF COURSE Road 10/19/2024 18:51:35 E21 324 - Motor vehicle accident, non-injury 205 MONTVIEW Avenue and PICO ST / CRYSTAL ST TK21 324 - Motor vehicle accident, non-injury 205 MONTVIEW Avenue and PICO ST / CRYSTAL ST 10/25/2024 19:34:32 E21 324 - Motor vehicle accident, non-injury 714 HAYSLETT Avenue and POTOMAC AVE / VICTORIA DR TK21 324 - Motor vehicle accident, non-injury 714 HAYSLETT Avenue and POTOMAC AVE / VICTORIA DR 10/28/2024 16:37:56 E21 352 - Extrication of victim(s) from vehicle NAYLOR AVE / WOOD Street TK21 352 - Extrication of victim(s) from vehicle NAYLOR AVE / WOOD Street Count:
181
Incident Category: 4 - Hazardous Condition (No Fire)
10/21/2024 16:11:35 TK21 412 - Gas leak (natural gas or LPG) 301 MARY Street and BUSH ST / UNION ST 10/31/2024 20:16:16 E21 424 - Carbon monoxide incident 904 PICO Street and MONTVIEW AVE / GENERAL PETROLEUM AVE TK21 424 - Carbon monoxide incident 904 PICO Street and MONTVIEW AVE / GENERAL PETROLEUM AVE 10/19/2024 17:37:53 TK21 480 - Attempted burning, illegal action, other COSWORTH AVE / OLIVAREZ Street Count: 4
Incident Category: 5 - Service Call
10/06/2024 13:32:45 E21 511 - Lock-out 702 PHILIPPINE Street and HARDING AVE / ARROYO DR TK21 511 - Lock-out 702 PHILIPPINE Street and HARDING AVE / ARROYO DR 10/21/2024 09:03:29 E21 522 - Water or steam leak 104 OLIVE Avenue and OAK ST, S 2ND ST / CRYSTAL ST TK21 522 - Water or steam leak 104 OLIVE Avenue and OAK ST, S 2ND ST / CRYSTAL ST 10/02/2024 10:09:42 TK21 553 - Public service 521 WILSON Avenue and DEAD END / E ST 10/01/2024 11:05:41 E21 554 - Assist invalid 403 POLK Street and DATE ST / ELM ST TK21 554 - Assist invalid 403 POLK Street and DATE ST / ELM ST 10/02/2024 07:58:58 TK21 554 - Assist invalid 505 ALPINE Avenue and MC KINLEY ST / CHURCH ST 10/04/2024 12:49:41 TK21 554 - Assist invalid 509 6TH Street and SAN EMIDIO ST / LUCARD ST 10/22/2024 04:26:32 E21 554 - Assist invalid 505 ALPINE Avenue and MC KINLEY ST / CHURCH ST TK21 554 - Assist invalid 505 ALPINE Avenue and MC KINLEY ST / CHURCH ST 10/24/2024 07:42:40 E21 554 - Assist invalid 201 8TH Street and NORTH ST / CENTER ST 10/28/2024 02:51:56 E21 554 - Assist invalid 207 E Street and 2ND AVE / 3RD AVE TK21 554 - Assist invalid 207 E Street and 2ND AVE / 3RD AVE 10/04/2024 18:44:53 E21 561 - Unauthorized/illegal burning (SRA/APCD or illegal campfire)
400 LIERLY Avenue and WOOD ST / BUENA VISTA ST
10/06/2024 18:38:23 E21 561 - Unauthorized/illegal burning (SRA/APCD or illegal campfire)
204 LIERLY Avenue and PICO ST / CRYSTAL ST
Count: 16
Incident Category: 6 - Good Intent Call
10/03/2024 09:20:49 E21 611 - Dispatched and cancelled en route 28144 SUNRIDGE Avenue and TURBO ST / 119 HWY 10/05/2024 00:53:03 E21 611 - Dispatched and cancelled en route 100 JEFFERSON Street and ASH ST / BIRCH ST 10/07/2024 13:23:35 E21 611 - Dispatched and cancelled en route 25 Hill Rd, Entrance 15B and TWENTY FIVE HILL RD, S 10TH ST,

BUENA VISTA PL / S
TK21 611 - Dispatched and cancelled en route 25 Hill Rd, Entrance 15B and TWENTY FIVE HILL RD, S 10TH ST,

BUENA VISTA PL / S
14:59:11 TK21 611 - Dispatched and cancelled en route 315 VAN BUREN Street and DATE ST / CEDAR ST 10/09/2024 14:33:48 E21 611 - Dispatched and cancelled en route South 10TH ST / FRONT Street 14:56:46 E21 611 - Dispatched and cancelled en route 715 KERN Street and 8TH ST / 7TH ST, WILDCAT WAY 10/11/2024 00:07:35 E21 611 - Dispatched and cancelled en route 215 OAK Street and AMBER ST / LIERLY AVE, S 6TH ST 12:56:48 E21 611 - Dispatched and cancelled en route EASTERN AVE / CRYSTAL Street 10/13/2024 01:36:45 E21 611 - Dispatched and cancelled en route 200 HILLARD Street and A ST / KEENE LN 10/14/2024 21:38:16 TK21 611 - Dispatched and cancelled en route 203 South 6TH Street and SUPPLY ROW / MAIN ST, 6TH ST 10/15/2024 18:30:31 E21 611 - Dispatched and cancelled en route 108 TAYLOR Street and COUGAR CT, ASH ST / BIRCH ST TK21 611 - Dispatched and cancelled en route 108 TAYLOR Street and COUGAR CT, ASH ST / BIRCH ST 10/17/2024 16:44:05 E21 611 - Dispatched and cancelled en route 218 4TH Street and NORTH ST / CENTER ST 10/24/2024 16:53:01 E21 611 - Dispatched and cancelled en route 1100 4TH Street and FINLEY DR / ASH ST, MONROE ST TK21 611 - Dispatched and cancelled en route 1100 4TH Street and FINLEY DR / ASH ST, MONROE ST 10/30/2024 18:49:43 E21 611 - Dispatched and cancelled en route ASH ST / HARRISON Street 6 of 8 Printed On: 11/07/2024 10:02:29 AM
Incident
Date
Incident
Time
Apparatus
ID
Incident Code Address
Apparatus:

Apparatus:

Incident Date:
10/31/2024 20:39:22 E21 611 - Dispatched and cancelled en route LUCARD ST / 4TH Street TK21 611 - Dispatched and cancelled en route LUCARD ST / 4TH Street 10/02/2024 20:37:11 E21 622 - No incident found on arrival at dispatch address
202 BUCHANAN Street and BIRCH ST / CEDAR ST
TK21 622 - No incident found on arrival at dispatch
address
202 BUCHANAN Street and BIRCH ST / CEDAR ST
10/03/2024 05:51:58 E21 622 - No incident found on arrival at dispatch address
500 AIRPORT Road and E LUCARD ST / E SAN EMIDIO ST
10/08/2024 18:37:27 E21 622 - No incident found on arrival at dispatch address
219 OLIVE Avenue and CRYSTAL ST / OAK ST, S 2ND ST
TK21 622 - No incident found on arrival at dispatch
address
219 OLIVE Avenue and CRYSTAL ST / OAK ST, S 2ND ST
10/13/2024 15:03:05 E21 622 - No incident found on arrival at dispatch address
1045 KERN Street and N 10TH ST / CASCADE PL
10/20/2024 08:07:11 E21 622 - No incident found on arrival at dispatch address
ELM ST / HARRISON Street
10/26/2024 03:30:24 E21 622 - No incident found on arrival at dispatch address
Mid oil and MIDOIL RD, SAGE ST / 3RD ST, MIDOIL RD, C ST 23:35:02 E21 622 - No incident found on arrival at dispatch address
215 8TH Street and CENTER ST / NORTH ST
TK21 622 - No incident found on arrival at dispatch
address
215 8TH Street and CENTER ST / NORTH ST
10/27/2024 16:10:30 E21 622 - No incident found on arrival at dispatch address
706 POLK Street and GREVILLEA ST / DEAD END
TK21 622 - No incident found on arrival at dispatch
address
706 POLK Street and GREVILLEA ST / DEAD END
10/28/2024 18:40:50 E21 622 - No incident found on arrival at dispatch address
POLK ST / ASH Street
TK21 622 - No incident found on arrival at dispatch
address
POLK ST / ASH Street
10/29/2024 07:27:11 E21 622 - No incident found on arrival at dispatch address
Hwy 166 and 166 HWY, PENTLAND RD / 166 HWY, BASIC SCHOOL RD
10/31/2024 21:11:44 E21 622 - No incident found on arrival at dispatch address
320 COMMERCE Way and DEAD END / GARDNER FIELD RD
TK21 622 - No incident found on arrival at dispatch
address
320 COMMERCE Way and DEAD END / GARDNER FIELD RD
10/06/2024 13:02:34 E21 631 - Authorized controlled burning (incl. warming fire)
1092 KERN Street and CASCADE PL / N 10TH ST
10/20/2024 09:40:13 TK21 651 - Smoke scare, odor of smoke ASH ST / TYLER Street 10/07/2024 18:04:14 E21 653 - Smoke from barbecue, tar kettle 1047 WOOD Street and WARD ST / GENERAL PETROLEUM AVE TK21 653 - Smoke from barbecue, tar kettle 1047 WOOD Street and WARD ST / GENERAL PETROLEUM AVE Count: 40
Incident Category: 7 - False Alarm & False Call
10/08/2024 20:05:30 E21 735 - Alarm system sounded due to malfunction
218 4TH Street and NORTH ST / CENTER ST
TK21 735 - Alarm system sounded due to
malfunction
218 4TH Street and NORTH ST / CENTER ST
10/09/2024 18:13:16 E21 735 - Alarm system sounded due to malfunction
218 4TH Street and NORTH ST / CENTER ST
TK21 735 - Alarm system sounded due to
malfunction
218 4TH Street and NORTH ST / CENTER ST
Count: 4
Count:
261
Report Criteria
Is Equal To E21
Is Equal To TK21
Is Equal To Last Month
7 of 8 Printed On: 11/07/2024 10:02:29 AM
Description
For Official Use Only: Last Month's Run Stats
8 of 8 Printed On: 11/07/2024 10:02:29 AM
REVIEWED BY:

CITY CLERK FINANCE DIRECTOR CITY MANAGER
City of Taft Agenda Report
DATE: NOVEMBER 19, 2024
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:

ANNUAL AUDITED FINANCIAL STATEMENTS FOR FY2016-2017
SUMMARY STATEMENT:

Attached is the Annual Audited Reports for the years ended June 30, 2017, which includes the Annual Comprehensive Financial Report (ACFR), Management Report (City wide), Wastewater Treatment Plant Financial Statements (WWTP). Since the City did expend more than $750,000 in Federal monies the City was required to prepare a Single Audit, which is attached.

On November 18, 2024, the Taft City Finance Committee reviewed the Annual Audited Comprehensive Financial Report. The committee recommended the financial statements be presented to the City Council.

RECOMMENDED ACTION
Motion to receive and file the Annual Audited Comprehensive Financial Reports for the year ended June 30, 2017 and Find that the activity is not a project per the California Environmental Quality Act (CEQA) as set forth in Section 15060(c)(3) and Section 15378 of the CEQA Guidelines.

IMPACT ON BUDGET (Y/N): No
ATTACHMENT (Y/N): YES, Comprehensive Annual Financial Reports dated June 30, 2017 and Management Report and Auditor’s
Communication Letter for the City, WWTP Financial
Statements and Single Audit Report dated June 30, 2017
PREPARED BY: Teresa Binkley, Finance Director

CITY OF TAFT

ANNUAL FINANCIAL REPORT

FOR THE FISCAL YEAR ENDED
JUNE 30, 2017
i

CITY OF TAFT

ANNUAL FINANCIAL REPORT
JUNE 30, 2017

TABLE OF CONTENTS

FINANCIAL SECTION

Independent Auditor’s Report ................................................................................................................... 1 Basic Financial Statements
Government-wide Financial Statements
Statement of Net Position ................................................................................................................ 5 Statement of Activities ..................................................................................................................... 6 Governmental Funds Financial Statements
Balance Sheet ................................................................................................................................... 8 Reconciliation of the Balance Sheet of Governmental
Funds to the Statement of Net Position ................................................................................... 11 Statement of Revenues, Expenditures, and Changes
in Fund Balances ..................................................................................................................... 12 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds
to the Statement of Activities ................................................................................................. 15 Proprietary Funds Financial Statements
Statement of Net Position .............................................................................................................. 16 Statement of Revenues, Expenses, and Changes in Fund Net Position ......................................... 18 Statement of Cash Flows ............................................................................................................... 20

Fiduciary Funds Financial Statements
Statement of Net Position .............................................................................................................. 22 Statement of Changes in Fund Net Position .................................................................................. 23 Notes to Basic Financial Statements ................................................................................................. 25 Required Supplementary Information
Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – General Fund ......................................................................................... 61 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – WWTP Special Revenue Fund .............................................................. 62 Schedule of Plan’s Proportionate Share of Net Pension Liability and Related Ratios as as of Measurement Date – Combined Plan ............................................................................. 63 Schedule of Pension Contributions – Combined Plan ................................................................... 65 Other Supplemental Information
Major Fund Budgetary Comparison Schedule
Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – WWTP Capital Projects Fund ............................................................... 68

ii

CITY OF TAFT

ANNUAL FINANCIAL REPORT
JUNE 30, 2017
TABLE OF CONTENTS (Continued)
Non-Major Governmental Funds
Combining Balance Sheet .............................................................................................................. 71 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances ........................................................................................................................ 74 Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual –
Traffic Safety Special Revenue Fund ............................................................................... 76 Gas Tax Special Revenue Fund ........................................................................................ 77 Inmate Welfare Trust Special Revenue Fund ................................................................... 78 TDA Special Revenue Fund ............................................................................................. 79 Asset Forfeiture Special Revenue Fund ............................................................................ 80 Landscape Assessment District Special Revenue Fund .................................................... 81 Crime Prevention Special Revenue Fund ......................................................................... 82 Private-Purpose Trust Funds and Agency Funds
Combining Statement of Net Position - Private-Purpose Trust Funds .......................................... 85 Combining Statement of Changes in Net Position -
Private- Purpose Trust Funds .................................................................................................. 86 Combining Statement of Assets and Liabilities - Agency Funds .................................................. 87 Combining Statement of Changes in Assets and Liabilities - Agency Funds .......................................................................................................................... 88 1 OFFICES: BEVERLY HILLS ∙ CULVER CITY ∙ SANTA MARIA MEMBER AMERICAN INSTITUTE OF C.P.A.’S ∙ CALIFORNIA SOCIETY OF MUNICIPAL FINANCE OFFICERS ∙ CALIFORNIA ASSOCIATION OF SCHOOL BUSINESS OFFICIALS

PARTNERS COMMERCIAL ACCOUNTING & TAX SERVICES GOVERNMENTAL AUDIT SERVICES RONALD A LEVY, CPA 433 N. CAMDEN DRIVE, SUITE 730 5800 HANNUM AVENUE, SUITE E CRAIG A HARTZHEIM, CPA BEVERLY HILLS, CA 90210 CULVER CITY, CA 90230 HADLEY Y HUI, CPA TEL: 310.273.2745 TEL: 310.670.2745
ALEXANDER C HOM, CPA FAX: 310.670.1689 FAX: 310.670.1689 ADAM V GUISE, CPA www.mlhcpas.com www.mlhcpas.com

TRAVIS J HOLE, CPA
INDEPENDENT AUDITOR’S REPORT
To the City Council
City of Taft, California
Report on the Financial Statements
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 City of Taft, California (City) as of and for the fiscal year ended June 30, 2017, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes 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.

Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion.

An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
2 Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Taft, California, as of June 30, 2017, and the respective changes in financial position, and, where applicable, cash flows thereof, for the fiscal year then ended in accordance with accounting principles generally accepted in the United States of America.

Other Matters
Required Supplementary Information
Management has omitted the Management’s Discussion and Analysis that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. Our opinion on the basic financial statements is not affected by this missing information.

Accounting principles generally accepted in the United States of America require that the budgetary comparison information on pages 61 and 62, the schedule of plan’s proportionate share of net pension liability on page 63 and the schedule of pension contributions on page 65, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Taft, California’s basic financial statements. The WWTP Capital Projects budgetary comparison schedule, combining and individual non-major governmental and fiduciary funds financial statements and schedules are presented for purposes of additional analysis and are not required parts of the basic financial statements.

The WWTP Capital Projects budgetary comparison schedule, combining and individual non-major governmental and fiduciary funds financial statements and schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements.

Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual non-major governmental and fiduciary funds financial statements and schedules are fairly stated in all material respects in relation to the basic financial statements as a whole.

3 Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated July 18, 2018, on our consideration of the City of Taft, California’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is 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 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 of Taft, California’s internal control over financial reporting and compliance.

Moss, Levy & Hartzheim, LLP
Culver City, California
July 18, 2018
4 This page intentionally left blank
ASSETS
Cash and investments 3,366,101 $ 8,732,731 $ 12,098,832 $ Restricted cash and investments 939,946 939,946
Accounts receivable 2,636,767 947,775 3,584,542
Interest receivable 5,175 7,237 12,412
Internal balances 790,742 (790,742)
Notes receivable 3, 3,489,583 489,583
Prepaid expenses 108,058 35,947 144,005
Deposits 17,397 17,397
Loan receivable - Successor Agency 1,588,959 1,588,959
Capital assets, not being depreciated 6,573,703 325,974 6,899,677 Capital assets, being depreciated 19,272,469 11,088,903 30,361,372 Capital assets, accumulated depreciation (11, (6,885,070) 704,122) (18,589,192) Total assets 24,438,443 16,109,090 40,547,533

DEFERRED OUTFLOWS OF RESOURCES
Pension 1,270,408 1,301,658 2,572,066
Total deferred outflows of resources 1,270,408 1,301,658 2,572,066

LIABILITIES
Accounts payable 210,075 268,303 478,378
Accrued payroll 155,860 229,126 384,986
Unearned revenue 265,372 1,072,223 1,337,595
Deposits payable 8,453 46,532 54,985
Noncurrent liabilities:

Due within one year 49,201 113,356 162,557
Due in more than one year 3,156,963 7,621,656 10,778,619 Total liabilities 8,374,772 4,822,348 13,197,120

DEFERRED INFLOWS OF RESOURCES
Pension 377,910 305,779 683,689
Total deferred inflows of resources 377,910 305,779 683,689

NET POSITION
Net investment in capital assets 11,942,482 4,529,807 16,472,289 Restricted for:

Streets and roads 194,098 194,098
Public safety 214,791 214,791
Community development 4,044,214 4,044,214
Capital projects - WWTP 3,756,919 3,756,919
Unrestricted (3,196,335) 7,752,814 4,556,479
Total net position 16,956,169 $ 12,282,621 $ 29,238,790 $

See accompanying notes to financial statements
Governmental
Activities
Business-type
Activities Total

CITY OF TAFT

STATEMENT OF NET POSITION
JUNE 30, 2017
5 CITY OF TAFT

STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Expenses
Governmental activities:

General government $ 2,866,426 (2,634,175) $ 713,996 $ - $ Public safety (4,183,217) 403,795 223,288
Public works (1,836,931) 178,303 113,239 750,686
Health and welfare (109,271) 4,499
Community development 58,702 (921,299) 441,434
Interest on long-term debt (30,648)
Total governmental activities 3,507,226 (9,715,541) 1,496,456 750,686 Business-type activities:

Community correctional facility (CCF) 13,147,253 (11,505,246) Federal WWTP (889,027) 989,327
Sewer 1,157,222 (1,061,111)
Refuse (865,635) 968,676 5,000
Transit (738,219) 354,384 584,458
Total business-type activities (15,059,238) 16,616,862 5,000 584,458 Total government $ 20,124,088 (24,774,779) $ 1,501,456 $ 1,335,144 $ General revenues and transfers:

Taxes:

Property taxes
Sales tax
Other taxes
Investment earnings
Miscellaneous
Transfers
Total general revenues and transfers
Change in net position
Net position, beginning of fiscal year
Net position, end of fiscal year
See accompanying notes to financial statements
Program Revenues
Charges for
Services
Operating Grants and
Contributions
Capital
Grants and
Contributions
6 Net (Expense) Revenue and Change in Net Position
$ - 946,247 $ 946,247 $
(3,556,134) (3,556,134)
(794,703) (794,703)
(104,772) (104,772)
(421,163) (421,163)
(30,648) (30,648)
(3,961,173) (3,961,173)
1,642,007 1,642,007
100,300 100,300
96,111 96,111
108,041 108,041
200,623 200,623

2,147,082 2,147,082
2,147,082 (3,961,173) (1,814,091)
1,403,625 1,403,625
1,195,038 1,195,038
541,446 541,446
72,094 56,064 128,158
303,945 303,945
(59,487) 59,487
12,607 3,559,605 3,572,212
2,159,689 (401,568) 1,758,121
10,122,932 17,357,737 27,480,669
$ 12,282,621 16,956,169 $ 29,238,790 $
Business-type
Activities Total
Governmental
Activities
7 CITY OF TAFT

GOVERNMENTAL FUNDS

BALANCE SHEET
JUNE 30, 2017
ASSETS General
Revolving Loan
Fund CDBG
Revolving Loan
Fund Home
WWTP Special
Revenue
Cash and investments $ 298,740 64,266 $ 998 $ - $
Receivables:

Accounts 308,739 639,036
Interest 1,916
Notes 1,607,982 1,506,154
Due from other funds 1,054,104
Prepaid items 512 71,804
Loan receivable from Successor Agency 1,588,959
Total assets 3,420,085 $ 1,906,722 $ 1,507,152 $ 309,251 $

LIABILITIES, DEFERRED INFLOW OF RESOURCES, AND FUND BALANCES

LIABILITIES
Accounts payable $ 20,861 145,384 $ - $ 38,077 $
Accrued payroll 2,185 147,199
Due to other funds 1,414,013
Deposit payable 8,453
Unearned revenue 265,372
Total liabilities 566,408 20,861 1,454,275

DEFERRED INFLOW OF RESOURCES
Deferred revenue 1,607,982 1,506,154
Total deferred inflow of resources 1,607,98 1,506,154 2

FUND BALANCES
Nonspendable 1,660,763 512
Restricted 277,879 998
Unassigned (1,145,536) 1,192,914
Total fund balances 2,853,677 277,879 998 (1,145,024)
Total liabilities, deferred inflow of
resources, and fund balances 3,420,085 $ 1,906,722 $ 1,507,152 $ 309,251 $ See accompanying notes to financial statements
8 WWTP Capital
Projects
Total Nonmajor
Governmental
Funds Total
$ 2,339,875 $ 3,358,606 654,727 $
947,775
3,031 5,175 228
3,489,583 375,447
1,414,013 2,468,117
106,755 34,439
1,588,959
$ 1,064,841 3,756,919 $ 11,964,970 $
$ - $ 209,507 5,185 $
151,575 2,191
1,677,375 263,362
8,453
265,372
270,738 2,312,282
375,447 3,489,583
375,447 3,489,583
1,695,714 34,439
650,249 3,756,919 4,686,045
(218,654) (266,032)
418,656 3,756,919 6,163,105
$ 1,064,841 3,756,919 $ 11,964,970 $
9 10
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CITY OF TAFT

GOVERNMENTAL FUNDS

RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS

TO THE STATEMENT OF NET POSITION
JUNE 30, 2017
Fund balances of governmental funds $ 6,163,105
Amounts reported for governmental activities in the statements of net position are different because:

Capital assets, net of accumulated depreciation, used in governmental activities, are not current financial resources. Therefore, they are not reported in the governmental funds.

Total capital assets 25,846,172 $
Accumulated depreciation (11,704,122) 14,142,050
Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the governmental funds. Long-term liabilities include certificates of participation , compensated absences and net pension liability. (7,735,012) Deferred outflows and inflows of resources relating to pensions: In governmental funds, deferred outflows and inflows of resources relating to pensions are not reported because they are applicable to future periods. In the statement of net position, deferred outflows and inflows of resources relating to pensions are reported.

Deferred inflows of resources relating to pensions (377,910) $ Deferred outflows of resources relating to pensions 1,270,408 892,498 Internal service funds are used by management to charge the costs of certain activities such as vehicle maintenance to individual funds. The assets and the liabilities of the internal service fund must be added to the statement of net position (not including compensated absences ($5,844)) 3,945
Certain revenues are deferred in the governmental funds because the availability criteria is not met. These revenues are not deferred in the statement of net position. 3,489,583 Net position of governmental activities $ 16,956,169
See accompanying notes to financial statements
11 CITY OF TAFT

STATEMENT OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCES
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
General
Revolving Loan
Fund CDBG
Revolving Loan
Fund Home
WWTP Special
Revenue

REVENUES
Property taxes $ - 1,403,625 $ - $ - $
Sales taxes 1,195,038
Other taxes 541,446
Licenses and permits, and fees 305,048
Fines and forfeitures 17,161
Use of money and property 146,870
Intergovernmental 18,621 816,078 1,756 713,997
Current services charges 31,587 3,078,822
Other 177,065
Total revenues 7,681,153 18,621 1,756 745,584

EXPENDITURES
Current:

General government 1,019,743 1,537,600
Public safety 3,705,596
Public works 1,189,594
Health and welfare
Community development 110,160 608,657 960
Capital outlay 2,273,246 2,090,910
Debt service:

Principal retirement 63,000
Interest and fiscal charges 30,648
Total expenditures 9,132,357 110,160 960 3,386,637
Excess of revenues
over (under) expenditures (1,451,204) (91,539) 796 (2,641,053)

OTHER FINANCING SOURCES (USES)
Proceeds from issuance of debt 1,895,222
Transfers in 113,077 93,945
Transfers out (151,029)
Total other financing sources (uses) 93,945 1,857,2 70
Net change in fund balances (1,357,259) (91,539) 796 (783,783) Fund balances, beginning of fiscal year 369,418 4,210,936 202 (361,241) Fund balances, end of fiscal year 2,853,677 $ 277,879 $ 998 $ (1,145,024) $ See accompanying notes to financial statements
12 WWTP Capital
Projects
Total Nonmajor
Governmental
Funds Total
$ - $ 1,403,625 - $
1,195,038
541,446
305,048
33,068 15,907
33,350 182,946 2,726
1,885,372 334,920
3,180,114 69,705
181,564 4,499
427,757 33,350 8,908,221
2,557,343
3,822,820 117,224
1,208,279 18,685
61,004 61,004
935,359 215,582
4,364,156
63,000
30,648
412,495 13,042,609
15,262 33,350 (4,134,388)
1,895,222
131,200 338,222
(113,077) (278,735) (14,629)
(14,629) 18,123 1,954,709
633 51,473 (2,179,679)
418,023 3,705,446 8,342,784
$ 418,656 3,756,919 $ 6,163,105 $
13 14
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CITY OF TAFT

GOVERNMENTAL FUNDS

RECONCILIATION OF STATEMENT OF REVENUES, EXPENDITURES,

AND CHANGES IN FUND BALANCES

TO THE STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Net change in fund balances of governmental funds $ (2,179,679) Amounts reported for governmental activities in the statement of activities differs from the amounts reported in the statement of revenues, expenditures, and changes in fund balance because:

Governmental funds report capital outlay as expenditures. However, in the statement of activities, the costs of those assets are allocated over their estimated useful lives as depreciation expense.

This activity is reconciled as follows:

Cost of assets capitalized 4,101,135 $
Depreciation expense 3,476,026 (625,109)
Certain notes receivable are reported in the governmental funds as expenditures and then offset by deferred revenue as they are not available to pay current expenditures.

Likewise, when the note is collected, it is reflected in revenue. This is the net change between notes receivable collected and issued. 346,265
In governmental funds, pension costs are recognized when employer contributions are made.

In the statement of activities, pension costs are recognized on the accrual basis. This fiscal year, the difference between accrual-basis pension costs and actual employer contributions was:

Pension costs (204,437)
Internal service funds are used by management to charge the costs of certain activities, such as vehicle maintenance to individual funds. The net revenues (expenses) of the internal service fund is reported under governmental activities. (5,844) Debt repayments are reported as an expenditures in the governmental funds.

The repayment is not an expense in the statement of activities as it is a reduction of a long-term liability. The balance for compensated absences reflects the difference between absences accrued and absences paid.

Proceeds certificates of participation (1,895,222)
Principal payment bond certificates of participation 63,000 Compensated absences (1,677)
Change in net position of governmental activities $ (401,568)

See accompanying notes to financial statements
15 CITY OF TAFT

STATEMENT OF NET POSITION

PROPRIETARY FUNDS
JUNE 30, 2017
Business-type Activities
Enterprise Funds
CCF Federal WWTP Sewer
ASSETS
Current assets:

Cash and investments $ 3,735,118 1,450,105 $ 2,449,127 $ Restricted cash and investments
Receivables:

Accounts 82,444 2,301,227 87,991
Interest 3,211 996 2,121
Prepaid items 645 28,005 580
Deposits 17,397
Total current assets 3,780,333 3,821,418 2,557,216
Noncurrent assets:

Capital assets, not being depreciated 11,850
Capital assets, being depreciated 5,851,420 209,433 2,908,733 Capital assets, accumulated depreciation (3,568,294) (134,267) (1,687,388) Total noncurrent assets 87,016 2,283,126 1,221,345
Total assets 3,867,349 6,104,544 3,778,561

DEFERRED OUTFLOWS OF RESOURCES
Pension 19,519 1,123,061 18,660
Total deferred outflows of resources 19,519 1,123,061 18,660

LIABILITIES
Current Liabilities:

Accounts payable 22,393 185,983 17,521
Accrued payroll 2,185 209,022 2,094
Due to other funds
Unearned revenue
Deposits payable 21,783
Current portion of compensated absences 2,307 39,804 1,820 Total current liabilities 26,885 434,809 43,218
Noncurrent liabilities:

Compensated absences 6,921 119,411 5,460
Net pension liability 39,448 2,597,524 38,517
Total noncurrent liabilities 46,369 2,716,935 43,977
Total liabilities 3,151,744 73,254 87,195

DEFERRED INFLOWS OF RESOURCES
Pension 1,298 263,020 1,714
Total deferred inflows of resources 1,298 263,020 1,714

NET POSITION
Net investment in capital assets 2,283,126 87,016 1,221,345 Unrestricted 3,766,385 1,488,630 2,486,967
Total net position (deficit) 1,575,646 $ 6,049,511 $ 3,708,312 $

See accompanying notes to financial statements
16 Business-type Activities Governmental
Enterprise Funds Activities
Refuse Transit
Total Enterprise
Funds
Internal Service
Fund
$ - 1,098,381 $ $ 8,732,731 $ 7,495
939,946 939,946

42,951 122,154 2,636,767
909 7,237
5,138 1,579 35,947 1,303
17,397
988,035 1,223,023 12,370,025 8,798
314,124 325,974
1,527,386 591,931 11,088,903
(1,019,559) (475,562) (6,885,070)
821,951 116,369 4,529,807
1,809,986 1,339,392 16,899,832 8,798
104,095 36,323 1,301,658
104,095 36,323 1,301,658
2,284 40,122 268,303 568
12,300 3,525 229,126 4,285
790,742 790,742
1,067,223 5,000 1,072,223
24,749 46,532
2,631 2,639 49,201 3,945
1,875,180 76,035 2,456,127 8,798
7,894 7,917 147,603
256,382 77,489 3,009,360
264,276 85,406 3,156,963
2,139,456 161,441 5,613,090 8,798
34,039 5,708 305,779
34,039 5,708 305,779
821,951 116,369 4,529,807
(1,081,365) 1,092,197 7,752,814
$ (259,414) 1,208,566 $ 12,282,621 $ - $

17 CITY OF TAFT

STATEMENT OF REVENUES, EXPENSES, AND

CHANGES IN FUND NET POSITION

PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Business-type Activities
Enterprise Funds
CCF Federal WWTP Sewer

OPERATING REVENUES
Charges for services $ 989,327 13,122,109 $ 1,145,149 $ Connection and installation fees 4,520
Other 7,553 25,144
Total operating revenues 13,147,253 989,327 1,157,222

OPERATING EXPENSES
Salaries and wages 73,539 5,572,706 68,888
Training and development 17,059
Contract and professional services 270,443 1,787,938 107,450 Maintenance and operations 9,121 155,448 417,082
Materials and supplies 101,642 271,895 1,584
Insurance 23,670 554,826 18,952
Utilities 48,674 378,181 292
Administrative service charges 68,407 246,080
Depreciation 227,128 47,125 72,104
Bad debt expense 1,287
Other operating expenses 6,060 2,720,068 127,392
Total operating expenses 11,505,246 828,684 1,061,111
Operating income (loss) 1,642,007 160,643 96,111

NONOPERATING REVENUES (EXPENSES)
Interest earnings on investments 33,702 6,688 22,403
Interest expense
Loss on abandonment (60,343)
Intergovernmental
Total nonoperating revenues (expenses) 6,688 (26,641) 22,403

CAPITAL CONTRIBUTION AND TRANSFERS
Capital contribution
Transfers out (19,829) (19,829)
Total capital contribution and transfers (1 (19,829) 9,829) Changes in net position 1,648,695 114,173 98,685
Total net position (deficit), beginning of fiscal year (73,049) 5,935,338 3,609,627 Total net position (deficit), end of fiscal year 1,575,646 $ 6,049,511 $ 3,708,312 $ See accompanying notes to financial statements
18 Governmental
Business-type Activities Activities
Enterprise Funds
Refuse Transit
Total Enterprise
Funds
Internal Service
Fund
$ 354,384 966,971 $ $ 16,577,940 $ 167,644
4,520
1,705 34,402
354,384 968,676 16,616,862 167,644
429,019 132,132 6,276,284 120,783
88 17,147
7,852 335,704 2,509,387
124,704 164,477 870,832 12,635
7,051 35,000 417,172 3,066
20,219 18,997 636,664
7,079 434,226 3,781
61,493 375,980 11,586
93,772 31,059 471,188
(109) 1,178
39,612 86,882 2,980,014 15,793
729,396 865,635 14,990,072 167,644
(375,012) 103,041 1,626,790
9,301 72,094
(8,823) (8,823)
(60,343)
5,000 5,000
(8,823) 14,301 7,928
584,458 584,458
(19,829) (59,487)
584,458 (19,829) 524,971
200,623 97,513 2,159,689
(460,037) 1,111,053 10,122,932
$ (259,414) 1,208,566 $ 12,282,621 $ - $
19 CITY OF TAFT

STATEMENT OF CASH FLOWS

PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Business-type Activities
Enterprise Funds
CCF Federal WWTP Sewer
Cash Flows from Operating Activities:

Cash received from customers and users $ 989,327 13,097,988 $ 1,134,824 $ Cash paid to suppliers for goods and services (540,677) (6,221,485) (952,966) Cash paid to employees for services (75,143) (5,615,088) (70,635) Net cash provided (used) by operating activities 373,507 1,261,415 111,223 Cash Flows from Capital and Related Financing Activities:

Acquisition, proceeds, and construction of capital assets Interest paid
Capital contribution
Net cash provided (used) by capital and related financing activities Cash Flows from Non-Capital Financing Activities:

Intergovernmental grant received
Cash received (paid) to/from other funds, including interest Transfers out (19,829) (19,829)
Net Cash provided (used) by Non-Capital Financing Activities: (19,829) (19,829) Cash Flows from Investing Activities:

Interest received 31,610 5,692 21,056
Net Cash provided (used) by investing activities 31,610 5,692 21,056 Net increase (decrease) in cash and cash equivalents 385,288 1,267,107 112,450 Cash and Cash Equivalents at Beginning of Fiscal Year 3,349,830 182,998 2,336,677 Cash and Cash Equivalents at End of Fiscal Year $ 3,735,118 1,450,105 $ 2,449,127 $ Reconciliation to Statement of Net Position:

Cash and investments $ 3,735,118 1,450,105 $ 2,449,127 $ Restricted cash and investments
Total cash and cash equivalents $ 3,735,118 1,450,105 $ 2,449,127 $ Reconciliation of Operating Income (Loss) to Net Cash
Provided (Used) by Operating Activities:

Operating income (loss) $ 160,643 1,642,007 $ 96,111 $
Adjustments to reconcile operating income (loss) to
net cash provided (used) by operating activities:

Depreciation 227,128 47,125 72,104
(Increase) decrease in accounts receivable (22,398) (49,265) (Increase) decrease in prepaid expenses (645) (25,829) (580) (Increase) decrease in deposits (18)
(Increase) decrease in deferred outflows of resources - pension (13,279) (636,126) (12,378) Increase (decrease) in deferred inflows of resources - pension (3,570) (171,021) (3,328) Increase (decrease) in net pension liability 13,602 651,608 12,679 Increase (decrease) in accounts payable (12,015) (310,241) (34,931) Increase (decrease) in accrued payroll 150 63,458 140
Increase (decrease) in unearned revenue
Increase (decrease) in deposits payable 2,682
Increase (decrease) in compensated absences 1,493 49,699 1,140 Total adjustments 212,864 (380,592) 15,112
Net cash provided (used) by operating activities $ 373,507 1,261,415 $ 111,223 $ Noncash Capital Activities'
Loss on abandonment of capital assets $ 60,343

See accompanying notes to financial statements
20 Governmental
Business-type Activities Activities
Internal
Enterprise Funds Service
Refuse Transit Totals Fund
$ 368,810 952,493 $ 16,543,442 $ 167,644 $
(216,945) (700,105) (8,632,178) (50,280)
(443,302) (136,277) (6,340,445) (121,742)
(291,437) 116,111 1,570,819 (4,378)
(251,428) (251,428)
(8,822) (8,822)
49,215 49,215
(211,035) (211,035)
5,000 5,000
(120,299) (120,299)
(59,487) (19,829)
(120,299) (14,829) (174,786)
67,068 8,710
67,068 8,710
(622,771) 109,992 1,252,066 (4,378)
1,562,717 988,389 8,420,611 11,873
$ 939,946 1,098,381 $ 9,672,677 $ 7,495 $
$ - 1,098,381 $ 8,732,731 $ 7,495 $
939,946 939,946
$ 939,946 1,098,381 $ 9,672,677 $ 7,495 $
$ (375,012) 103,041 $ 1,626,790 $ - $
93,772 31,059 471,188
(1,832) (16,183) (89,678)
(5,138) (1,579) (33,771) (1,303)
(18)
(52,664) (22,843) (737,290)
(14,158) (6,141) (198,218)
53,945 23,399 755,233
(5,202) 1,542 (360,847) (2,116)
(1,983) 283 62,048 940
16,258 16,258
5,058 2,376
577 1,157 54,066 (1,899)
83,575 13,070 (55,971) (4,378)
$ (291,437) 116,111 $ 1,570,819 $ (4,378) $

21 Private-Purpose
Trust Funds Agency Funds
ASSETS
Cash and investments $ 68,496 54,332 $
Cash and investments with fiscal agents 453,806
Interest receivable 1,152
Prepaid items 133
Capital assets - nondepreciable 1,698,163
Capital assets - being depreciated 407,116
Capital assets - accumulated depreciation (236,306)
Total assets 2,378,396 68,496 $

LIABILITIES
Accounts payable 84 11,497 $
Accrued payroll 891
Accrued interest payable 83,375
Deposits payable 559
Due to inmates 56,440
Loan payable to City of Taft 1,588,959
Bonds payable 2,875,000
Total liabilities 4,548,309 68,496 $

NET POSITION
Restricted for debt service 370,431
Unrestricted (2,540,344)
Total net position (deficit) (2,169,913) $
See accompanying notes to financial statements

CITY OF TAFT

STATEMENT OF NET POSITION

FIDUCIARY FUNDS
June 30, 2017
22 Private Purpose
Trust Funds
Additions:

Investment revenue 124,067 $
Taxes and assessments 265,530
Total additions 389,597
Deductions:

Community development 63,528
Interest expense 167,417
Depreciation 10,178
Total deductions 241,123
Change in net position 148,474
Net Position (Deficit) - July 1, 2016 (2,318,387)
Net Position (Deficit) - June 30, 2017 (2,169,913) $
See accompanying notes to financial statements

CITY OF TAFT

FIDUCIARY FUNDS

STATEMENT OF CHANGES IN NET POSITION
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
23 24
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25 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of Taft, California (the City), which was founded on November 7, 1910, has a population of 9,052 living within an area of 15.05 square miles. It is located in Western Kern County 119 miles northwest of Los Angeles, 280 miles south of San Francisco, and 37 miles southwest of Bakersfield in the foothills of the western edge of southern San Joaquin Valley.

The financial statements of 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 units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.

A. Reporting Entity
In evaluating how to define the City for financial reporting purposes, management has considered all potential component units. The decision to include a potential component unit in the reporting entity was made by applying the criteria set forth in the U.S. GAAP. The basic—but not the only—criterion for including a potential component unit within the reporting entity is the governing body’s ability to exercise oversight responsibility. The most significant manifestation of this ability is financial interdependency. Other manifestations of the ability to exercise oversight responsibility include, but are not limited to, the selection of the governing authority, the designation of management, the ability to significantly influence operations and accountability for fiscal matters. The other criteria used to evaluate potential component units for inclusion or exclusion from the reporting entity is the existence of special financing relationships, regardless of whether the City is able to exercise oversight responsibilities. Based upon the application of these criteria, the following is a brief review of each potential component unit addressed in defining the City’s reporting entity.

Included within the reporting entity:
 Taft Public Financing Authority. A nonprofit public benefit corporation created in 1994 through a Joint Exercise of Powers agreement between the City of Taft and the Taft Community Development Agency established for the purpose of, among other things, issuing bonds to provide financing and refinancing for public capital improvements of the City and Agency. (Separate financial statements are not prepared for this entity.)  Taft Public Improvement Corporation. A nonprofit public benefit corporation, created in 1989 to provide services for the betterment of the City. These services include constructing various capital improvements for the City, assisting with the creation or expansion of the City’s facilities, the purchase and sale of real or personal property and assisting the City to finance, acquire, construct and install such property. (Separate financial statements are not prepared for this entity.)
 Greater Taft Transportation Authority. The Greater Taft Transportation Authority (GTTA) was formed in April 2001 as a joint exercise of powers between the City of Taft and Taft Community Development Agency pursuant to the California Government Code Section 6500 et seq. (Separate financial statements are not prepared for the GTTA.)

26 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) B. Accounting and Reporting Policies
The City has conformed to the pronouncements of the GASB, which are the primary authoritative statements of accounting principles generally accepted in the United States of America applicable to state and local governments.

C. Fund Accounting
The accounts of the City are organized on the basis of funds, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for with a separate set of selfbalancing accounts that comprise its assets, liabilities, deferred inflow/outflow of resources, fund equity, revenues, and expenditures/expenses. Government resources are allocated to and accounted for in individual funds based upon the purpose for which they are to be spent and the means by which spending activities are controlled. The various funds are grouped, in the financial statements in this report, into generic fund types and broad categories as follows:

Governmental Funds:
 General Fund. The General Fund is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in other funds.  Special Revenue Funds. The Special Revenue Funds are used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specific purposes.  Capital Projects Fund. The Capital Project Fund is used to account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by Proprietary Funds).

Proprietary Funds:
 Enterprise Funds. The Enterprise Funds are used to account for operations that are financed and operated in a manner similar to a private business enterprise – where the intent of the City Council is that the costs (expenses including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges.
 Internal Service Fund – Garage Fund. The Garage Fund is used to account for the cost of providing vehicle maintenance to operating funds. Costs are recovered by user charges.

Fiduciary Funds:

 Agency Funds. The Agency Funds are used to account for assets held by the City as an agent.

These funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations.

27 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) C. Fund Accounting (Continued)
 Private Purpose Funds. These funds are for disbursements made only for those activities to wind down the business of the former Taft Community Development Agency (TCDA). These activities include, but are not limited to the payment of debt service related to the bonds issued by the TCDA as well as other contractual commitments.

D. Basis of Accounting/Measurement Focus
Government-wide Financial Statements
The City’s Government-wide Financial Statements include a Statement of Net Position and a Statement of Activities (including changes in Net Position). These statements present summaries of governmental and business-type activities of the City. Fiduciary activities of the City are not included in these statements.

These statements are presented on an “economic resources” measurement focus and the accrual basis of accounting. Accordingly, all the City’s assets and liabilities, including capital assets and infrastructure as well as long-term debt, are included in the accompanying Statement of Net Position.

The Statement of Activities presents changes in net position. Under the accrual basis of accounting, revenues are recognized in the period in which the liability is incurred. The Statement of Activities demonstrates the degree to which the direct expenses of a given function are offset by program revenues. Direct expenses are those that are clearly categories: 1) charges for services, 2) operating grants and contributions, and 3) capital grants and contributions. Charges for services include revenues from customers or applicants who purchase, use or directly benefit from goods, services, or privileges provided by a given function. Grants and contributions include revenues restricted to meeting the operational or capital requirements of a particular function. Taxes and other items not properly included among program revenue are reported as general revenue.

Certain eliminations have been made as prescribed by GASB Statement No. 34 in regards to interfund activities, payables, and receivables. All internal balances in the Statement of Net Position have been eliminated.

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 funds and aggregated nonmajor funds. An accompanying schedule is presented to reconcile and explain the differences in fund balances as presented in these statements to the net position presented in the government-wide financial statements. The City has presented all major funds that met the qualifications of GASB Statement No. 34.

28 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Basis of Accounting/Measurement Focus (Continued)
Governmental Fund Financial Statements (Continued)
All governmental funds are accounted for on a spending or financial flow measurement focus and the modified accrual basis of accounting. Accordingly, only current assets and current liabilities are generally included on their balance sheets. Their reported fund balance is their net current assets, which is considered only to be a measure of available spendable resources. Governmental fund operating statements present a summary of sources and uses of available spendable resources during a period by presenting increases and decreases in net current assets. Under modified accrual basis of accounting, revenues are recognized in the accounting period in which they both become measurable and available to finance expenditures of the current period. Accordingly, revenues are recorded when received in cash, except that revenues subject to accrual (generally 60 days after year-end) are recognized when due. Those revenues susceptible to accrual are property taxes, sales taxes, interest revenues, charges for services, and special assessments. Licenses, fines, and permit revenues are not susceptible to accrual because they generally are not measurable until received in cash.

Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred, except for principal and interest on long term obligations which are recognized when due. Because of their current financial resources focus, expenditure recognition for governmental fund types excludes amounts represented by non-current liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund expenditures or fund liabilities.

The City reports the following major governmental funds:

The General Fund is the government’s primary operating fund. It accounts for all financial resources of the City, except those required to be accounted for in another fund.

The Revolving Loan Fund – CDBG was established to account for Community Development grants by using Community Development program revenue.

The Revolving Loan Fund – HOME was established to account for funds as direct loans for rehabilitation or reconstruction of dwellings owned and occupied by qualifying low and moderate income households.

The WWTP Special Revenue Fund is used to account for special projects related to the City’s share of the wastewater treatment plant.

The WWTP Capital Projects Fund is used to account for capital asset acquisition and construction of the wastewater treatment plant.

29 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Basis of Accounting/Measurement Focus (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. All proprietary fund types are accounted for using the accrual basis of accounting and the economic resources measurement focus. Their revenues are recognized when earned, and expenses are recognized when incurred. All liabilities associated with their activity are also included in the Statement of Net Position.

Proprietary Funds include enterprise funds. The City reports the following major enterprise funds:

The Federal WWTP Fund is used to account for the operations related to building and maintaining a wastewater treatment plant for the federal prison.

The CCF Fund is used to account for the operations of the Community Correctional Facility. The CCF provides housing and program services to the California Department of Corrections.

The Sewer Fund is used to account for the operations of the City’s sewer system.

The Transit Fund is used to record the operations of the Taft Area Transit Dial-A-Ride service.

The enterprise collects fares from users of the service.

The Refuse Fund is used to record the operation of the refuse removal enterprise of the City. The enterprise collects user fees for the collection of refuse from businesses and residents in the City of Taft.

Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the City’s proprietary funds are charges to customers for services. Operating expenses include the cost of services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses. The principal operating revenue of the internal service fund is charges to other funds. Operating expenses for the internal service fund include the costs of vehicle maintenance.

Internal Service Fund Statements
The City reports an Internal service fund of the Central Garage Fund. This fund is established to account for any activity that provides goods or services to other funds or departments of the primary government and its component units, or to other governments, on a cost-reimbursement basis. See proprietary funds above for accounting for internal service funds.

30 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Basis of Accounting/Measurement Focus (Continued)
Fiduciary Fund Financial Statements
Fiduciary Fund Financial Statements include a Statement of Net of Position and a Statement of Changes in Net Position. The fiduciary funds are used to report assets held in a trustee or agency capacity for others and therefore, are not available to support City programs. Since these assets are being held for the benefit of a third party, these funds are not incorporated into the government-wide statements.

The City’s fiduciary funds are agency funds and private purpose trust funds. These funds use the accrual basis of accounting, Agency funds are used to account for amounts held for debt service related to conduit debt, and amounts held on behalf of inmates housed in the Community Correctional Facility. The Agency funds are custodial in nature (assets equal liabilities) and therefore do not involve measurement of results of operations. The private purpose funds are used to account for the redevelopment agency successor agency by the City as trustee. Trust funds are accounted for on the economic resources measurement focus.

E. Budgetary Policy and Control
General Budget Policies
The City Council approves each year’s budget submitted by the City Manager prior to the beginning of the new fiscal year. Public meetings are conducted prior to its adoption by the Council. All appropriations lapse at year-end. The City Council has the legal authority to amend the budget at any time during the fiscal year. The City Manager has the authority to make adjustments to the operating budget within each fund. Transfers of operating budget appropriations between funds or to or from appropriated reserve accounts, use of unappropriated fund balances, cancellation of appropriations and all changes in capital improvement project budgets require the approval of the City Council.

The City maintains budgetary controls to ensure compliance with legal provisions embodied in the appropriated budget approved by the City Council. The level of budgetary control (that is, the level at which expenditures cannot legally exceed the appropriated amount) for the operating budget is at fund level. Formal budgetary integration is employed as a management control device during the fiscal year for the Governmental Fund Types.

F. Cash/Investment Policy
In order to maintain an effective investment program, all cash, except certain trust and agency cash and restricted cash, is pooled, and amounts not required for day-to-day financial transactions are invested as approved by the City Council on a pooled basis and earnings are allocated to each fund on the basis of its average cash balance at the end of each quarter.

GASB Statement No. 31, “Accounting and Financial Reporting for Certain Investments and External Pools”, requires governmental entities to report certain investments at fair value in the balance sheet and recognize the corresponding change in the fair value of investments in the year in which the change occurred. In accordance with GASB Statement No. 31, the City has adjusted certain investments to fair value (when material).

31 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) G. Capital Assets and Depreciation
Capital assets, which include buildings, machinery and equipment, and infrastructure assets (roads, bridges, etc.) are reported in the government-wide financial statements as well as proprietary fund financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $500. Sensitive items with costs below $500 are also included. Such assets are recorded at historical cost or estimated historical cost if actual historical cost is not available.

Capital assets are depreciated over their estimated useful lives using the straight-line method. This means the cost of the asset is divided by its expected useful life in years and the result is charged to expense each year until the asset is fully depreciated. The purpose of depreciation is to spread the cost of capital assets over the useful life of these assets. The amount charged to depreciation expense each year represents that year’s pro rata share of the cost of capital assets.

Depreciation of capital assets is charged as an expense against operations each year and the total amount of depreciation taken over the years, called accumulated depreciation, is reported on the Statement of Net Position of the government-wide financial statements as a reduction in the book value of capital assets.

The City has assigned the useful lives listed below to capital assets:

Structures and improvements 20-40 Years
Machinery and equipment 5-20 Years
Infrastructure
Pavement 40 Years
Concrete 60 Years
H. Deferred Outflow/Inflow of Resources
In addition to assets, the statement of net position and balance sheet will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The City has deferred outflows of resources on pensions in the statement of net position.

In addition to liabilities, the statement of net position and balance sheet will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and will not be recognized as an inflow of resources (revenue) until that time. The City has deferred inflows of resources-deferred revenue – loans/notes on the governmental funds financial statements and pensions in the statement of net position.

I. Interfund Transactions
Quasi-external transactions are accounted for as fund revenues or expenditures/expenses.

Transactions, which constitute reimbursements to a fund for expenditures/expenses are recorded as expenditures/expenses in the reimbursing fund, and as reductions of the expenditures/expenses in the reimbursed fund.

32 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) J. Capitalized Interest
No interest cost relating to construction was capitalized during the fiscal year ending June 30, 2017.

K. Compensated Absences
 Sick leave liability
Generally, employees earn one day of sick leave per month with a maximum accumulation of 720 hours. All employees are entitled to payment for accumulated sick leave up to the lower of 50 percent of earned days or forty-five days, upon retirement, death, or disability.  Vacation leave liability
Employees earn ten days vacation leave per year, for less than four years of service; from four years through nine years of service, fifteen days are earned; from ten years through nineteen years of service, twenty days are earned; and after nineteen years, twenty-five days. All employees are able to accrue an amount equal to twice the employee’s annual accrual, after which further accrual will cease. Accumulated vacation is payable upon termination. The compensated absences accrual at June 30, 2017, amounted to $185,588 for Governmental Activities and $196,804 for Business-type Activities.

L. Property Taxes
Property Taxes attach as an enforceable lien on property as of January 1. Taxes are levied on July 1 and are payable in two installments which are delinquent after December 10 and April 10. Unsecured personal property taxes become due on July 1st of each year and are delinquent, if unpaid by August 31st. Kern County bills and collects the property taxes and remits them to the City in installments during the year. City property tax revenues are recognized on the modified accrual basis of accounting method. The County is permitted by State Law (Proposition 13) to levy taxes at 1 percent of full value (at time of purchase). The City receives a share of this basic levy proportionate to what it received in the 1976 to 1978 period.

M. Cash Flows
Proprietary fund type cash and investments are used in the preparation of the statement of cash flows as investments are pooled and are not allocated to specific funds. Each of these funds’ share of pooled cash and investments is considered cash for purposes of the statement of cash flows since these amounts are immediately available for withdrawal. For the purposes of the Proprietary Funds’ Statement of Cash Flows, the City considers all investments with a maturity of three months or less when purchased to be cash equivalents.

N. Use of Restricted Resources
When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, and then unrestricted resources as they are needed. Restricted resources are defined as resources received from outside agencies dedicated for specific purposes (grants for example).

33 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) O. Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

P. Pensions
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the City’s California Public Employees’ Retirement System (CalPERS) plans (Plans) and additions to/deductions from the Plans’ fiduciary net position have been determined on the same basis as they are reported by CalPERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported as fair value.

Q. New Accounting Pronouncements
Future Accounting Standards:

GASB has issued the following statements which may impact the City’s financial reporting requirements in the future:

Statement No. 75 "Accounting and Financial Reporting for The provisions of this statement are Postemployment Benefits Other Than effective for fiscal years beginning Pensions" after June 15, 2017.

Statement No. 81 "Irrevocable Split-Interest Agreements" The provisions of this statement are effective for fiscal years beginning
after December 15, 2016.

Statement No. 82 "Pension Issues-an amendment of The provisions of this statement are GASB Statement No. 67, No. 68, and effective for fiscal years beginning No. 73." after June 15, 2017.

Statement No. 83 "Certain Asset Retirement Obligations" The provisions of this statement are effective for fiscal years beginning
after June 15, 2018.

Statement No. 84 "Fiduciary Activities" The provisions of this statement are effective for fiscal years beginning
after December 15, 2018.

Statement No. 85 "Omnibus 2017" The provisions of this statement are effective for fiscal years beginning
after June 15, 2017.

Statement No. 86 "Certain Debt Extinguishment Issues" The provisions of this statement are effective for fiscal years beginning
after June 15, 2017.
34 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Q. New Accounting Pronouncements (Continued)
NOTE 2 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
A. General Budget Policies

1. The budget adopted by the City Council provides for the general operation of the City. It includes proposed expenditures and the means of financing them.

2. The City Council approves total budgeted appropriations and any amendments to appropriations throughout the fiscal year. All amendments made during the fiscal year are included in the budgetary amounts reported herein. The “appropriated budget” covers all City expenditures.

Actual expenditures may not exceed budgeted appropriations at the fund level, which is the legal level of budgetary control.

3. Formal budgetary integration is employed as a management control device during the fiscal year.

Commitments for materials and services, such as purchase orders and contracts, are recorded as encumbrances to assist in controlling expenditures. Appropriations which are encumbered lapse at fiscal year-end, and then are added to the following fiscal year’s budgeted appropriations.

4. Budgets for the General, Special Revenue, Capital Projects, and Debt Service Funds are adopted on a basis substantially consistent with accounting principles generally accepted in the United States of America (U.S. GAAP). Accordingly, actual revenues and expenditures can be compared with related budgeted amounts without any significant reconciling items.

Budget comparisons are not presented for the Proprietary funds, as the City is not legally required to adopt a budget for this type of funds.

There were no budgets adopted for the following funds: RLF-CDBG (major fund), Revolving Loan Fund – Home (major fund), Cal Homes Revolving Loan, CDBG Home – 6859 and TARP Revolving Loan.

Statement No. 87 "Leases" The provisions of this statement are effective for fiscal years beginning
after December 15, 2019.

Statement No. 88 "Certain Disclosures Related to Debt, The provisions of this statement are including Direct Borrowings and Direct effective for fiscal years beginning Placements" after June 15, 2018.

Statement No. 89 "Accounting for Interest Cost Incurred The provisions of this statement are before the End of a Construction Period" effective for fiscal years beginning after December 15, 2019.
35 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 2 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (CONTINUED) A. General Budget Policies (Continued)

5. Capital projects are budgeted through the Capital Projects Funds. Appropriations for capital projects authorized but not constructed or completed during the fiscal year are carried forward as continuing appropriations into the following fiscal year’s budget.

6. Under Article XIII-B of the California constitution (the GANN Spending Limitation Initiative), the City is restricted as to the amount of annual appropriations from the proceeds of taxes, and if proceeds of taxes exceed allowed appropriations, the excess must either be refunded to the State Controller or returned to the taxpayers through revised tax rates or revised fee schedules, or an excess in one year may be offset by a deficit in the following year. For the fiscal year ended June 30, 2017, based on calculations by City staff, proceeds of taxes did not exceed appropriations.

Further, section 5 of Article XIII-B allows the City to designate a portion of fund balance for general contingencies, to be used for any purpose.

B. Deficit Fund Balances/Net Position
The following funds contained deficit fund balances/net position as of June 30, 2017:

The City anticipates that future revenue will be sufficient to cover these deficits.

Major Governmental Fund:

WWTP Special Revenue $ 1,145,024
Major Proprietary Fund:

Transit 259,414
Nonmajor Governmental Fund:

CDBG Home - 6859 208,790
Landscape Assessment District 57,197
36 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 2 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (CONTINUED) C. Excess of Expenditures over Appropriations
Excess of expenditures over appropriations in departments/cost centers of individual funds:

NOTE 3 – CASH AND INVESTMENTS
The City maintains a cash and investment pool that is available for use by all funds. Cash and investments at June 30, 2017, consisted of the following:

Final
Expenditures Appropriations Excess
Major Governmental Funds
General Fund
Public works 1,189,594 $ 1,169,067 $ 20,527 $
Community development 608,657 590,452 18,205
Capital outlay 2,090,910 1,006,078 1,084,832
WWTP
General government 1,113,391 1,006,011 107,380
Nonmajor Governmental Funds
Inmate Welfare Trust
Health and welfare 61,004 47,484 13,520
Asset Forfeiture
Public safety 19,889 16,933 2,956
Landscape Assessment
Public works 18,685 18,482 203
Crime Prevention
Public safety 97,335 81,046 16,289
Statement of Net Position:

Cash and investments 12,098,832 $
Restricted cash and investments 939,946
Statement of Fiduciary Net Position:

Cash and investments 122,828
Cash and investments with fiscal agents 453,806
Total cash and investments 13,615,412 $
Cash on hand 6,285 $
Deposits held by financial institutions 1,658,055
Investments 11,951,072
Total cash and investments 13,615,412 $
37 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
Investments authorized by the California Government Code and the City’s Investment policy The table on next page identifies the investment types that are authorized for the City by the California Government Code (or the City’s investment policy, where more restrictive). The table also identifies certain provisions of the California Government Code (or the City’s investment policy, where more restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustee that are governed by the provisions of debt agreements of the City, rather than the general provisions of the California Government Code or the City’s investment policy.

Investment Authorized by Debt Agreements
Investments of debt proceeds held by bond trustee are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City’s investment policy. The table below identifies the investment types that are authorized for investments held by bond trustee. The table also identifies certain provisions of these debt agreements that address interest rate risk.

Authorized Investment Type
Maximum
Maturity
Maximum
Percentage/
Amount of
Portfolio
Maximum
Investment in
One Issuer
U.S. Treasury Obligations 5 Years None None
Certificates of Deposit 5 Years None None
Negotiable Certificates of Deposit 3 Years 30% None
Passbook Savings Accounts N/A None None
County Pooled Investment Funds N/A 50% None
Local Agency Investment Fund (LAIF) N/A $65,000,000 $65,000,000 U.S. Agency Securities N/A None None
Authorized Investment Type
Maximum
Investment in
One Issuer
Maximum
Percentage/
Amount of
Portfolio
Maximum
Maturity
U.S. Agency Securities None None None
Money Market Mutual Funds None None N/A
Commercial Paper None None 270 days
Certificates of Deposit None None 5 years
Repurchase Agreements None None 180 days
U.S. Treasury Obligations None None 365 days
Time Deposits None None 365 days
38 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. Information about the sensitivity of the fair values of the City’s investments (including investments held by bond trustee) to market interest rate fluctuations are provided by the table below that shows the distribution of the City’s investments by maturity:

Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the minimum rating required by (where applicable) the California Government Code, the City’s investment policy, or debt agreements, and the actual rating as of fiscal year-end for each investment type:

Concentration of Credit Risk
The City is in compliance with restrictions imposed by the investment policy, which limits certain types of investments. As of June 30, 2017, the City has not invested more than 5% of its total investments in any one issuer. Investments guaranteed by the United States Government and investments in mutual funds and external investment pools are excluded from this requirement.

Remaining Maturity (in Months)
12 Months 13 to 24 25 to 60
Investment Type or Less Months Months Total
State Investment Pool (LAIF) 4,679,005 $ - $ - $ 4,679,005 $ Certificates of Deposit 1,703,281 622,000 1,992,980 4,318,261 U.S. Agency Securities 2,500,000 2,500,000
Held by Trustees:

U.S. Agency Securities 365,000 365,000
Money Market Funds 88,806 88,806
Total 6,836,092 $ 622,000 $ 4,492,980 $ 11,951,072 $
S&P Rating
Minimum Exempt From
Investment Type Amount Legal Rating Disclosure AAA AA+ A Not Rated State Investment Pool (LAIF) 4,679,005 $ N/A - $ - $ - $ - $ 4,679,005 $ Certificates of Deposit 4,318,261 N/A 4,318,261
U.S. Agency Securities 2,500,000 N/A 2, 500,000
Held by Trustees:

U.S. Agency Securities 365,000 N/A 365,000
Money Market Funds 88,806 N/A 88,806
Total 11,951,072 $ - $ 88,806 $ 2, $ - 865,000 $ 8,997,266 $ 39 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of a failure of the counterparty (e.g. broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party.

The California Government Code and the City’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provisions for deposits: The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The fair value of the pledged securities in the collateral pool must equal at least 110% of the total fair value deposited by the public agencies. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits.

GASB Statement No. 40 requires that the following disclosure be made with respect to custodial credit risks relating to deposits and investments: All of the City deposits with financial institutions (including Certificates of Deposit) in excess of federal depository insurance limits were held in pledged collateral accounts as described above.

As of June 30, 2017, all of the City’s deposits with financial institutions in excess of federal depository insurance limits were held in collateralized accounts. As of June 30, 2017, the City’s investment in the following type was held by the same broker-dealer (Counterparty) that was used by the City to buy the security:

Investment Type Reported Amount
Certificates of Deposit $4,318,261
Investment in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. The fair value of the City’s investment in this pool is reported in the accompanying financial statements at amounts based upon the City’s pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis.

LAIF is a governmental investment pool managed and directed by the California State Treasurer and is not registered with the Securities and Exchange Commission. An oversight committee, comprised of California State officials and various participants, provided oversight to the management of the fund. The daily operations and responsibilities of LAIF fall under the auspices of the State Treasurer’s office. The City is a voluntary participant in the investment pool.

40 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
Fair Value Measurements:

The City pool investment categorizes its fair value measurements within the fair value hierarchy established by accounting principles generally accepted in the United States of America. These principles recognize a three-tiered fair value hierarchy, as follows:

Level 1: Investments reflect prices quoted in active markets; Level 2: Investments reflect prices that are based on a similar observable asset either directly or indirectly, which may include inputs in markets that are not considered to be active; and, Level 3: Investments reflect prices based upon unobservable sources.

The City pool investment has the following recurring fair value measurements as of June 30, 2017:

The City also had investments in money market mutual funds, however, these investments are not required to be measured under Level 1, 2 or 3.

NOTE 4 – NOTES RECEIVABLE
The City operates a loan program whereby funds are made available to eligible businesses and individuals for various purposes. Grant funds were originally used to start the program and repayments are required to be used for the same purpose. As of June 30, 2017, the balance of notes receivable was $ 3,489,583, of this amount, $3,114,136 are deferred housing loans, which are due when the properties are transferred.

These loans are collateralized by the titles of the properties. The remaining balances are made up of CDBG loans made to local businesses. These loans carry interest rates between 1% to 5%. All the loans are deferred revenue offsets.

NOTE 5 – INTERFUND ACTIVITIES
In general, the City uses interfund transfers to (1) move revenues from the funds that collect them to the funds that statute or budget requires to expend them, (2) use unrestricted revenues collected in the General Fund to help finance various programs and capital projects accounted for in other funds in accordance with budgetary authorization, and (3) move cash to debt service funds from the funds responsible for payment as debt service payments become due.

In general, the effect of the interfund activity has been eliminated from the government-wide financial statements.

Fair Value Measurements Using
Investment by Fair Value Level Fair Value
Quoted Prices in
Active Markets
for Identical
Assets (Level 1)
Significant Other
Observable Input
(Level 2)
Significant
Unobservable
Inputs (Level 3)
Debt securities
Certificates of deposits 4,318,261 $ 4,318,261 $ - $ - $ US Government Agency Securities 2,865,000 2,865,000
Total Investments Measured at Fair Value 7,183,261 7,183,261 $ - $ - $ Investments Measured at Amortized Cost
LAIF 4,679,005
Total Pooled Investments 11,862,266 $
41 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 5 – INTERFUND ACTIVITIES (CONTINUED)
Interfund transfers during the fiscal year ended June 30, 2017 are as follows:

Current interfund balances arise in the normal course of business (i.e. one fund loaning funds to pay for current expenditures) and are expected to be repaid shortly after the end of the fiscal year. The following is a summary of interfund balances as of June 30, 2017.

In addition, the general fund advanced $1,588,959 to the Successor Agency Capital Projects Fund (formerly the TCDA Capital Projects Funds) within the Private Purpose Trust Funds.

Transfers In Transfers Out
Major Governmental Funds:

General 93,945 $ - $
WWTP Special Revenue 113,077 151,029
WWTP Capital Projects 131,200 113,077
Nonmajor Governmental Fund:

Asset Forfeiture 14,629
Major Proprietary Funds:

Federal WWTP 19,829
Sewer 19,829
Refuse 19,829
Total interfund transfers 338,222 $ 338,222 $
Due from Due to
(Receivable) (Payable)
Major Governmental Funds:

General 1,054,104 $ - $
WWTP Capital Projects 1,414,013
WWTP Special Revenue 1,414,013
Major Proprietary Fund:

Transit 790,742
Nonmajor Governmental Funds:

CDBG Home 6859 208,790
Landscape Assessment District 54,572
Total 2,468,117 $ 2,468,117 $
42 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 6 – CAPITAL ASSETS AND DEPRECIATION
In accordance with GASB Statement No. 34, the City has reported all capital assets including infrastructure in the government-wide statement of net position. The City elected to use the basic approach as defined by GASB Statement No. 34 for all infrastructures reporting, whereby depreciation expense and accumulated depreciation have been recorded. The following table presents the capital asset activity for the fiscal year ended June 30, 2017.

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

Balance Balance
Governmental Activities July 1, 2016 Additions Deletions June 30, 2017 Capital assets not being depreciated:

Land 1,342,372 $ - $ - $ 1,342,372 $
Construction in progress 2,673,304 2,839,065 (281,038) 5,231,331 Total capital assets not being depreciated 4,015,676 2,839,065 (281,038) 6,573,703 Capital assets being depreciated:

Structures and improvements 9,258,451 900,298 10,158,749 Machinery and equipment 3,548,284 361,772 3,910,056
Infrastructure:

Roadway system 4,657,443 281,038 4,938,481
Bridges 265,183 265,183
Total capital assets being depreciated 17,729,361 1,543,108 19,272,469 Less accumulated depreciation for:

Structures and improvements (5,643,592) (265,804) (5,909,396) Machinery and equipment (3,103,213) (138,514) (3,241,727) Infrastructure:

Roadway system (2,075,865) (211,951) (2,287,816)
Bridges (256,343) (8,840) (265,183)
Total accumulated depreciation (11,079,013) (625,109) (11,704,122) Total capital assets, being depreciated
net of accumulated depreciation 6,650,348 917,999 7,568,347 Total Governmental activities capital assets,
net of accumulated depreciation 10,666,024 $ 3,757,064 $ (281,038) $ 14,142,050 $ General government 99,136 $
Public safety 92,898
Public works 384,258
Health and welfare 48,817
Total depreciation expense - governmental activities 625,109 $ 43 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 6 – CAPITAL ASSETS AND DEPRECIATION (CONTINUED)
Changes in business-type activities capital assets:

Depreciation for business-type activities was charged to functions/programs as follows:

NOTE 7 – GOVERNMENTAL ACTIVITIES LONG-TERM DEBT
During the fiscal year ended June 30, 2017, the following changes occurred to the governmental activities long-term liabilities:

Compensated Absences
The short-term portion of the liability is determined to be the amount due to employees for future absences, which is attributable to services already rendered, and which is expected to be paid during the next fiscal year. The general fund is expected to liquidate approximately 75 percent of the liability, the WWTP special revenue fund approximately 10 percent, and other funds, the remaining 15 percent.

Balance Balance
Business-type activities July 1, 2016 Additions Deletions June 30, 2017 Capital assets not being depreciated:

Land 11,850 $ - $ - $ 11,850 $
Construction in progress 604,207 251,428 (541, 314,124 511) Total capital assets not being depreciated 616,057 251,428 (541,511) 325,974 Capital assets being depreciated:

Structures and improvements 6,046,142 6,046,142
Machinery and equipment 1,662,640 481,168 (9,782) 2,134,026 Sewer infrastructure 2,908,735 2,908,735
Total capital assets being depreciated 10,617,517 481,168 (9,782) 11,088,903 Less accumulated depreciation for:

Structures and improvements (3,566,770) (234,964) (3,801,734) Machinery and equipment (1,241,610) (164,120) 9,782 (1,395,948) Sewer infrastructure (1,615,284) (72,104) (1,687,388)
Total accumulated depreciation (6, (471,188) 423,664) 9,782 (6,885,070) Total capital assets, being depreciated,
net of accumulated depreciation 4,193,853 9,980 4,203,833 Total Business-type activities capital assets,
net of accumulated depreciation 4,809,910 $ 261,408 $ (541, $ 4,529,807 511) $ CCF 47,125 $
Federal WWTP 227,128
Sewer 72,104
Refuse 31,059
Transit 93,772
Total depreciation expense - business-type activities 471,188 $ 44 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 7 – GOVERNMENTAL ACTIVITIES LONG-TERM DEBT (CONTINUED) During the fiscal year ended June 30, 2017, the following changes occurred to the governmental activities long-term liabilities: (Continued)
Certificates of participation
Certificates of Participation (COP) are long-term instruments which are tax exempt and therefore, issued at interest rates below current market levels for taxable investments.

On June 15, 2015, the WWTP has entered into a loan financing program with the United States Department of Agriculture, acting through its agency the USDA Rural Development, to finance a portion of the cost and expense of the acquisition and construction of certain improvements to the wastewater treatment system of the City of Taft, and in connection with the loan financing program, the City intends to cause the execution and delivery to USDA Rural Development of certificates of participation.

In support of the proposed Certificates of Participation, the City proposes to enter into a financing program with the Taft Public Improvement Corporation, a California nonprofit public benefit corporation duly organized and existing under and by virtue of the laws of the State of California (the "Corporation"), for the purchase by the Corporation of the real property on which the wastewater system is situated (the "Site"), together with the existing wastewater treatment system improvements (the "Existing Facilities") situated thereon, and the purchase by the City from the Corporation of the completed Project.

The City is in receipt of a Letter of Conditions, originally dated November 8, 2012 and extended through April 10, 2017 (the "Letter of Conditions"), from USDA Rural Development, setting forth certain conditions to be satisfied by the City with respect to receipt from USDA Rural Development of funding for the Project, comprised of a loan in the amount of not-to-exceed $3,619,000 to be represented by the Certificates of Participation. The Installment payments shall be payable during a period of not more than 40 years and the interest rate shall not exceed 1.75% per annum.

During the fiscal year 2016-17, the City spent $3,251,654 for the project which was completed in May 2017. The City received loan funds of $1,895,222 during the fiscal year 2016-17 with the remaining certificates of participation issued of $1,356,432 disbursed to the City during FY 2017-18.

Balance Balance Due in
Governmental Activities: July 1, 2016 Additions Deletions June 30, 2017 One Year Compensated absences 179,966 $ 5,622 $ - $ 185,588 $ 49,356 $ Net pension liability 4,104,463 1,948,257 (702,864) 5,349,856 Certificates of participation 367,346 1,895,222 (63,000) 2,199,568 64,000 Total governmental activities 4,651,775 $ 3,849,101 $ (765,864) $ 7,735,012 $ 113,356 $ 45 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 7 – GOVERNMENTAL ACTIVITIES LONG-TERM DEBT (CONTINUED) Certificates of Participation maturity schedule:

NOTE 8 – BUSINESS-TYPE ACTIVITIES LONG-TERM DEBT
During the fiscal year ended June 30, 2017, the following changes occurred to the business-type activities long-term liabilities:

Compensated Absences
The liability is recorded in the various funds and is determined to be the amount due to employees for future absences, which is attributable to services already rendered. The amount estimated to be paid during the next fiscal year is classified with current liabilities, with the remainder classified with noncurrent liabilities.

NOTE 9 – PENSION PLAN
A. General Information about the Pension Plan
Plan Descriptions - All qualified employees are eligible to participate in the City’s separate Safety (fire and police) and Miscellaneous (all other) Plans, cost-sharing multiple employer defined benefit pension plans administered by the California Public Employees' Retirement System (CalPERS), which acts as a common investment and administrative agent for its participating member employers. Benefit provisions under the Plans are established by State statute and Local Government resolution. CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.

Benefits Provided - CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries.

Fiscal year ending
June 30, Principal Interest
2018 $ 64,000 $ 38,492
2019 65,000 37,373
2020 67,000 36,235
2021 68,000 35,062
2022 69,000 33,872
2023-2027 363,000 150,847
2028-2032 397,000 117,895
2033-2037 431,000 82,002
2038-2042 472,000 42,890
2043-2045 203,568 5,455
Totals $ 2,199,568 $ 580,123
Certificates of Participation
Balance Balance Due in
Business type activities July 1, 2016 Additions Deletions June 30, 2017 One Year Compensated absences 142,738 $ 54,066 $ - $ 196,804 $ 49,201 $ Net pension liability 2,254,127 1,097,675 (342,442) 3,009,360 Total business-type activities 2,396,865 $ 1,151,741 $ (342,442) $ 3,206,164 $ 49,201 $ 46 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 9 – PENSION PLAN (CONTINUED)
Benefits are based on years of credited service, equal to one year of full time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied as specified by the Public Employees' Retirement Law.

A. General Information about the Pension Plan (Continued) The Plans’ provisions and benefits in effect at June 30, 2017, are summarized as follows:

Contributions - Section 20814(c) of the California Public Employees' Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July l following notice of a change in the rate. Funding contributions for both Plans are determined annually on an actuarial basis as of June 30 by CalPERS. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the fiscal 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 fiscal year ended June 30, 2017, the contributions recognized as part of pension expense were as follows:

Contributions – employer (Safety Plan) $253,683
Contributions – employer (Miscellaneous Plan) $522,653

Tier I Tier II Pepra
Hire date Prior to October 3, 1996 On or after October 3, 1996 On or after January 1, 2013 Benefit formula 2.0%@50 2.0%@55 2.0%@50
Benefit vesting schedule 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life Retirement age 50 - 55 50 - 55 50 - 57
Monthly benefits, as a % of eligible compensation 2.0% to 2.7% 1.4% to 2.0% 1.426% to 2.7% Required employee contribution rates 9.00% 7.00% 9.500% Required employer contribution rates 14.785% 12.055% 9.418% Tier I PEPRA
Hire date Prior to January 1, 2013 On or after January 1, 2013 Benefit formula 2.0%@55 2.0%@62
Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50 - 63 52 - 67
Monthly benefits, as a % of eligible compensation 1.4% to 2.4% 1.0% to 2.5% Required employee contribution rates 7.00% 6.25%
Required employer contribution rates 8.377% 6.555%
City Miscellaneous Plan
City Safety Plan
47 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 9 – PENSION PLAN (CONTINUED)
B. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
As of June 30, 2017, the City reported net pension liability for its proportionate share of the net pension liability in the amount of $8,359,216.

The City’s net pension liability is measured as the proportionate share of the net pension liability. The net pension liability is measured as of June 30, 2016, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2015 rolled forward to June 30, 2016 using standard update procedures. The City's proportion of the net pension liability was based on a projection of the City’s long-term share of contributions to the pension plans relative to the projected contributions of all participating employers, actuarially determined. The City’s proportionate share of the net pension liability for the Plan as of June 30, 2015 and 2016 was as follows:

For the fiscal year ended June 30, 2017, the City recognized pension expense of $1,215,153. At June 30, 2017, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Safety Miscellaneous Combined Total
Proportion - June 30, 2015 0.07952% 0.10821% 0.18773%
Proportion - June 30, 2016 0.08041% 0.12074% 0.20115%
Change - Increase 0.15993% 0.22895% 0.38888%
Deferred Outflows Deferred Inflows
of Resources of Resources
Difference between expected and actual
experience 17,498 $ (25,815) $
Changes of assumptions (260,626)
Changes of employer's proportions 172,284 (250,425)
Net difference between projected and actual
earnings on pension plan investments 1,328,737
Changes in proportion and differences
between City contributions and
proportionate share of contributions 137,384 (146,823)
City contributions subsequent to the
measurement date 916,163
$ (683,689) 2,572,066 $
48 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 9 – PENSION PLAN (CONTINUED)
B. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
$916,163 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the fiscal year ended June 30, 2018. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:

Actuarial Assumptions - The total pension liabilities in the June 30, 2015 actuarial valuations were determined using the following actuarial assumptions:

All other actuarial assumptions used in the June 30, 2015 valuation were based on the results of an actuarial experience study for the fiscal years 1997 to 2011, including updates to salary increase, mortality, and retirement rates. The experience study report can be obtained at CalPERS’ website under Forms and Publications.

Fiscal Year Ended
June 30
2018 53,134 $
2019 34,063
2020 540,243
2021 344,774
Safety Miscellaneous
Valuation Date June 30, 2015 June 30, 2015
Measurement Date June 30, 2016 June 30, 2016
Actuarial Cost Method Entry-Age Normal Cost Method Entry-Age Normal Cost Method Actuarial Assumptions:

Discount Rate 7.65% 7.65%
Inflation 2.75% 2.75%
Payroll Growth 3.00% 3.00%
Project Salary Increase 3.30%-14.20% 3.30%-14.20%
Investment Rate of Return 7.50% 7.50%
Mortality* Derived using CalPERS' Derived using CalPERS' Membership Data for all Membership Data for all
Funds Funds
* The mortality table used was developed based on CalPERS' specific data. The table includes 20 years of mortality improvements using Society of Actuaries Scale BB. For more details on this table, please refer to the 2014 experience report.
49 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 9 – PENSION PLAN (CONTINUED)
B. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
Discount Rate - The discount rate used to measure the total pension liability was 7.65%. To determine whether the municipal bond rate should be used in the calculation of a discount rate for each plan, CalPERS stress tested plans that would most likely result in a discount rate that would be different from the actuarially assumed discount rate. The tests revealed the assets would not run out. Therefore, the current 7.65% discount rate is appropriate, and the use of the municipal bond rate calculation is not necessary. The long term expected discount rate of 7.65% is applied to all plans in the Public Employees Retirement Fund. The cash flows used in the testing were developed assuming that both members and employers make their contributions on time and as scheduled in all future years. The stress test results are presented in a detailed report called “GASB Crossover Testing Report” that can be obtained at CalPERS’ website under the GASB 68 section.

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, staff took into account both short-term and long-term market return expectations as well as the expected pension (PERF) fund cash flows.

Taking into account historical returns of all Public Employees Retirement Funds’ asset classes (which includes the agent plan and two cost-sharing plans or PERF A, B, and C funds), expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11-60 years) using a building-block approach. Using the expected nominal returns for both shortterm and long-term, the present value of benefits was calculated for each PERF fund. The expected rate of return was set by calculating the single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equal to the single equivalent rate calculated above and rounded down to the nearest one quarter of one percent.

The table on the next page reflects the long-term expected real rate of return by asset class. The rate of return was calculated using the capital market assumptions applied to determine the discount rate and asset allocation. These rates of return are net of administrative expenses.

50 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 9 – PENSION PLAN (CONTINUED)
B. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
Sensitivity of the Net Pension Liability to Changes in the Discount Rate -The following presents the net pension liability of the Local Government for each Plan, calculated using the discount rate for each Plan, 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 or 1 percentage point higher than the current rate:

Pension Plan Fiduciary Net Position - Detailed information about each pension plan's fiduciary net position is available in the separately issued CalPERS financial reports.

New
Strategic Real Return Real Return
Asset Class Allocation Years 1 - 10 (a) Years 11+ (b)
Global Equity 51.00% 5.25% 5.71%
Global Fixed Income 20.00% 0.99% 2.43%
Inflation Sensitive 6.00% 0.45% 3.36%
Private Equity 10.00% 6.83% 6.95%
Real Estate 10.00% 4.50% 5.13%
Infrastructure and Forestland 2.00% 4.50% 5.09%
Liquidity 1.00% 0.55% -1.05%
Total 100.00%
(a) An expected inflation of 2.50% used for this period. (b) An expected inflation of 3.00% used for this period.

Safety Miscellaneous Combined Total
1% Decrease 6.65% 6.65% 6.65%
Net Pension Liability 6,426,916 $ 6,731,754 $ 13,158,670 $ Current Discount Rate 7.65% 7.65% 7.65%
Net Pension Liability 4,164,739 $ 4,194,477 $ 8,359,216 $ 1% Increase 8.65% 8.65% 8.65%
Net Pension Liability 2,307,724 $ 2,097,544 $ 4,405,268 $ 51 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 10 – NET POSITION AND FUND BALANCES
Governmental and Business -Type Activities
Net Position
GASB Statement No. 63 requires that the difference between assets added to the deferred outflows of resources and liabilities added to the deferred inflows of resources be reported as net position. In the Government-wide financial statements, proprietary fund financial statements, and private-purpose trust fund financial statements, net position is classified as either net investment in capital assets, restricted, or unrestricted.
 Net Investment in Capital Assets describes the portion of net position which is represented by the current net book value of the City’s capital assets, less the outstanding balance of any debt issued to finance these assets.
 Restricted describes the portion of net position, which is restricted as to use by the terms and conditions of agreements with outside parties, governmental regulations, laws, or other restrictions which the City cannot unilaterally alter. These principally include debt service requirements, capital projects, and deferred improvement funds restricted to low and moderate income housing purposes.
 Unrestricted describes the portion of net position which is not restricted as to use.

When both restricted and unrestricted net position are available, restricted resources are depleted first before the unrestricted resources are used.

Fund Balances
Fund balance is classified as nonspendable, restricted, committed, assigned and/or unassigned based primarily on the extent to which the City is bound to observe constraints imposed upon the use of the resources in the government funds.

NOTE 11 – RISK MANAGEMENT
The City is exposed to various risks of loss related to theft of, damage to, and destruction of assets including low value vehicle coverage; errors and omissions; injuries to employees and natural disasters.

The City participates with other public entities in a joint venture under a joint powers agreement, which establishes the Central San Joaquin Valley Risk Management Authority (CSJVRMA) as a common risk management and insurance program. The relationship between the City and CSJVRMA is such that CSJVRMA is not a component of the City for financial reporting purposes.

CSJVRMA maintains separate records for each year of participation. The records track cash paid to the RMA through deposit premium assessments, the City’s self-insurance retention portion of claims paid, and the City’s allocation of shared risks. Three years after the close of the workers’ compensation coverage year and five years after the close of the general liability coverage year, CSJVRMA assesses the status of all members for that year, and issues a refund to a member if it has a positive balance (i.e. payout and reserve experience is less than premium paid) or collects any deficit.

52 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 11 – RISK MANAGEMENT (CONTINUED)
Worker’s Compensation
The City is self-insured for the first $50,000 of each claim. The City participates in a risk sharing pool through CSJVRMA for claims between $50,000 and $500,000. The CSJVRMA participates in another excess pool, which provides workers’ compensation coverage from $500,000 to $4,500,000 and purchases excess reinsurance above $5,000,000 to the statutory limit.

General Liability
The City is self-insured for the first $25,000 of each claim. The City participates in a risk sharing pool through CSJVRMA for claims between $25,000 and $1,000,000. The CSJVRMA is a member of the California Affiliated Risk Management Authorities (CARMA) program for the purpose of obtaining excess coverage in a risk sharing pool. The CARMA program provides coverage from $1,000,000 to $29,000,000. The CARMA program has 54 members participating in the pooled liability program during the 2016/2017 fiscal year. CSJVRMA was established under the provisions of California Government Code Section 6500 et seq. The CSJVRMA is governed by a Board of Directors, which meets three to four times per year, consisting of one member appointed by each member city. The day-to-day business is handled by a management group employed by the CSJVRMA.

The financial position and results of operations for the CSJVRMA as of June 30, 2017, is presented below:

At the termination of the joint powers agreement and after all claims have been settled, any excess or deficit will be divided among the cities in accordance with its governing documents. Audited financial statements are available from the Central San Joaquin Risk Management Authority at 6371 Auburn Boulevard, Citrus Heights, CA 95621.

During the past three fiscal years, none of the above programs of protection have had settlements or judgments that exceeded pooled or insured coverage. There have been no significant reductions in pooled or insured liability coverage from coverage in the prior year.

NOTE 12 – COMMITMENTS AND CONTINGENCIES
The City has received State and Federal funds for specific purposes that are subject to review by the grantor agencies. Although such audits could generate expenditure disallowances under the terms of the grants, it is believed that any required reimbursements will not be material.

From time to time, City is involved in various litigation matters incidental to operations, which in the opinion of the City, the ultimate outcome will not a material effect on operations.

Total Assets 100,984,219 $
Total Liabilities 83,009,648 $
Total Retained Earnings 17,974,571
Total Liabilities and Retained Earnings 100,984,219 $
Revenues for Fiscal Year 44,008,474 $
Expenses for Fiscal Year 43,973,513
Change in Net Position 34,961 $
53 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 12 – COMMITMENTS AND CONTINGENCIES (CONTINUED)
The City is a lessor in certain month – to – month leases. In addition, the City leases properties under non-cancelable operating leases. Minimum rents due under these leases are as follows:

NOTE 13 – FUND EQUITY
Fund Balance – Governmental Funds
As of June 30, 2017, fund balances of the governmental funds are classified as follows:
 Nonspendable – amounts that cannot be spent either because they are in nonspendable form or because they are legally or contractually required to be maintained intact.  Restricted – amounts that can be spent only for specific purposes because of constitutional provisions or enabling legislation or because of constraints that are externally imposed by creditors, grantors, contributors, or the laws or regulations of other governments.  Committed – amounts that can be used only for specific purposes determined by a formal action of the governing board as the highest level of decision-making authority for the City.

Commitments may be established, modified, or rescinded only through ordinances or resolutions approved by the governing board.
 Assigned – amounts that do not meet the criteria to be classified as restricted or committed but that are intended to be used for specific purposes. Under the City’s adopted policy, only the governing board or director may assign amounts for specific purposes.  Unassigned – all other spendable amounts.

Fiscal Year
Ending
June 30, Amount
2018 36,000 $
2019 36,000
2020 36,000
2021 36,000
2022 36,000
Thereafter 234,000
Total 414,000 $
54 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 13 – FUND EQUITY (CONTINUED)
Fund Balance – Governmental Funds
When an expenditure is incurred for purposes for which both restricted and unrestricted fund balance is available, the City considers restricted funds to have been spent first. When an expenditure is incurred for which committed, assigned, or unassigned fund balances are available, the City considers amounts to have been spent first out of committed funds, then assigned funds, and finally, unassigned funds, as needed, unless the City Council has provided otherwise in its commitment or assignment actions.

NOTE 14 – AGREEMENTS
Under agreements between the City of Taft, the Taft Heights Sanitation District, and the Ford City Sanitation District dated May 29, 1950, amended March 7, 1966, restated April 24, 1972, and restated August 21, 1991, covering the “Joint Sewage Project – 1972,” the City operates and maintains the Wastewater Treatment Plant (WWTP) serving the City and the two Sanitation Districts. The City includes the activities of the WWTP within its fund structure since the Agreement specifies that the City shall act on its own behalf and on behalf of the other Districts in operating and maintaining the WWTP. The City maintains the accounting records for the WWTP and has physical custody of its assets. The Agreement specifies that the City shall contribute 52 percent of the revenue required to operate and maintain the WWTP, with the other Districts providing a combined 48 percent of the operating revenue. Since the WWTP is not a separate legal entity, it is not considered a component unit.

NOTE 15 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY
On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X 26 (“the Bill”) that provides for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City of Taft that previously had reported a redevelopment agency within the reporting entity of the City as a blended component unit.

General
Revolving
Loan Fund
CDBG
Revolving
Loan Fund
Home
WWTP
Special
Revenue
WWTP
Capital
Projects
Total Non-major
Governmental
Funds Total
Nonspendable:

Prepaid items $ 71,804 $ - $ - $ 512 $ - $ 34,439 106,755 $ Principal on advances 1,588,959 1,588,959
Total Nonspendable 1,660,763 512 34,439 1,695,714

Restricted for:

Streets and roads 194,098 194 ,098
Public safety 180,397 180,397
Community development 277,879 998 275,754 554,631
Capital Projects - WWTP 3,756,919 3,756,919
Total Restricted 277,879 998 3,756,919 650,249 4,686,045

Unassigned 1,192,914 (1,145,536) (266,032) (218,654)

Total Fund Balances $ 2,853,677 $ 277,879 $ 998 $ (1,145,024) $ 3,756,919 $ 418,656 $ 6,163,105

55 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 15 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT

AGENCY (CONTINUED)
On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X 26 (“the Bill”) that provides for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City of Taft that previously had reported a redevelopment agency within the reporting entity of the City as a blended component unit.

The Bill provides that upon dissolution of a redevelopment agency, either the city or other unit of local government will agree to serve as the “successor agency” to hold the assets until they are distributed to other units of state and local government. On January 17, 2012, the City Council elected to become the Successor Agency for the former redevelopment agency in accordance with the Bill as part of City resolution number 12.

After enactment of the law, which occurred on June 28, 2011, redevelopment agencies in the State of California cannot enter into new projects, obligations or commitments. Subject to the control of a newly established oversight board, remaining assets can only be used to pay enforceable obligations in existence as the date of the dissolution (including the completion of any unfinished projects that were subject to legally enforceable contractual commitments).

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

The Bill directs the State Controller of the State of California review the propriety of any transfers of assets between redevelopment agencies and other public bodies that occurred after January 1, 2011. If the public body that received such transfers is not contractually committed to a third party for the expenditure or encumbrance of those assets, the state Controller is required to order the available assets to be transferred to the public body designated as the successor agency by the Bill.

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

Prior to that date, the final seven months of activity of the redevelopment agency continued to be reported in the governmental funds of the City. After the date of dissolution, the assets and activities of the dissolved redevelopment agency are reported in a fiduciary fund (private-purpose trust fund) in the financial statements of the City.

56 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 15 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT

AGENCY (CONTINUED)
Capital Asset activity for the fiscal year ended June 30, 2017 was as follows:

The following is a schedule of long-term liabilities for the fiscal year ended June 30, 2017:

The maturity schedule of the bonds is as follows:

Balance Balance
July 1, 2016 Additions Deletions June 30, 2017
Capital assets not being depreciated:

Land 1,698,163 $ - $ - $ 1,698,163 $
Total capital assets not being depreciated 1,698,163 1,698,163 Capital assets being depreciated:

Structures and improvements 407,116 407,116
Total capital assets being depreciated 407,116 407,116
Less accumulated depreciation for:

Structures and improvements (226,128) (10,178) (236,306) Total accumulated depreciation (226,128) (10,178) (236,306) Total capital assets, being depreciated
net of accumulated depreciation 180,988 (10,178) 170,810 Total Governmental activities capital assets,
net of accumulated depreciation 1,879,151 $ (10,178) $ - $ 1,868,973 $ Balance Balance Due in
July 1, 2016 Additions Deletions June 30, 2017 One Year 1998 Revenue Refunding Bonds 3,055,000 $ - $ (180,000) $ 2,875,000 $ 195,000 $ Total governmental activities 3,055,000 $ - $ (180,000) $ 2,875,000 $ 195,000 $ Fiscal Year
Ending
June 30, Principal Interest Total
2018 195,000 $ $ 361,750 166,750 $
2019 205,000 360,440 155,440
2020 220,000 363,550 143,550
2021 235,000 365,790 130,790
2022 240,000 357,160 117,160
2023-2027 1,440,000 1,799,310 359,310
2028 340,000 19,720 359,720
Total 2,875,000 $ 1,092,720 $ 3,967,720 $
57 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 16 - OTHER MATTERS
Pursuant to City Resolution No. 3392-12 dated January 11, 2012, which was in part the result of the California Supreme Court’s ruling in California Redevelopment Association v. Matosantos Case No.

S194861 which upheld AB26x1 that dissolved all of the redevelopment agencies in California, the City determined that it is in the best interests to serve as Successor Agency.

Further, pursuant to the above Resolution, the City had the Taft Housing Authority assume all rights, powers, assets, liabilities, duties and obligations associated with housing activities of the Taft Community Development Agency. City Resolution 3284, dated March 15, 2011, created a Housing Authority and designated City Council members as the Housing Authority Commissioners. Presently, any Taft Housing Authority expenditure actions need approval of the Successor Agency.

NOTE 17 – SUBSEQUENT EVENTS
During the fiscal year 2017-2018, the City borrowed an additional $1,356,432 by issuing Certificates of Participation (COP). Please see Note #7 – Governmental Activities Long-Term Debt for additional details.
58 This page intentionally left blank
59 CITY OF TAFT

MAJOR FUND BUDGETARY COMPARISON SCHEDULES
JUNE 30, 2017
Budgetary comparison schedules are presented as Required Supplementary Information for the General Fund and WTTP Special Revenue Fund as provided for by GASB Statement No. 34. The budgetary comparison schedules for the remaining major funds are presented to aid in additional analysis and is not a required part of the basic financial statements or Required Supplementary Information.

Budgets were not adopted for the Revolving Loan Fund CDBG and Revolving Loan Fund Home. 60 This page intentionally left blank

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

GENERAL FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Original Budget Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Property taxes 1,377,921 $ 1,398,716 $ 1,403,625 $ 4,909 $ Sales taxes 1,207,824 1,206,009 1,195,038 (10,971)
Other taxes 437,566 483,313 541,446 58,133
Licenses and permits, and fees 270,418 301,332 305,048 3,716 Fines and forfeitures 2,300 17,156 17,161 5
Use of money and property 133,902 125,427 146,870 12,968 Intergovernmental 519,761 49,100 816,078 296,317
Current services charges 3,155,861 3,126,513 3,078,822 (47,691) Other 45,570 122,016 177,065 55,049
Total revenues 7,308,718 6,671,987 7,681,153 372,435

EXPENDITURES
Current:

General government 2,039,657 1,588,735 1,537,600 51,135 Public safety 3,604,465 3,712,484 3,705,596 6,888
Public works 1,314,894 1,169,067 1,189,594 (20,527)
Community development 666,570 590,452 608,657 (18,205)
Capital outlay 1,009,000 1,006,078 2,090,910 (1,084,832) Total expenditures 8,634,586 8,066,816 9,132,357 (1,065,541) Excess (deficiency) of revenues
over expenditures (758,098) (1,962,599) (1,451,204) (693,106)

OTHER FINANCING SOURCES (USES)
Transfers in 1,962,601 767,098 93,945 (673,153)
Total other financing sources (uses) 1,962,601 767,098 93,945 (673,153) Net change in fund balance 2 9,000 (1,357,259) (1,366,259) Fund balance, beginning of fiscal year 4,210,936 4,210,936 4,210,936 Fund balance, end of fiscal year $ 4,219,936 4,210,938 $ 2,853,677 $ (1,366,259) $ 61 CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

WWTP SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Original Budget Final Budget
Actual
Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Intergovernmental 802,081 $ 713,997 $ 713,997 $ - $
Current service charges 31,587 70,000 31,587
Total revenues 872,081 745,584 745,584

EXPENDITURES
Current:

General government 1,006,011 887,826 1,019,743 (13,732) Capital outlay 3,410,000 2,273,246 2,273,246
Total Expenditures 4,297,826 3,279,257 3,292,989 (13,732) Excess (Deficiency) of Revenues
Over Expenditures (3,425,745) (2,533,673) (2,547,405) (13,732)

OTHER FINANCING SOURCES (USES)
Proceeds from issuance of debt 2,262,568 3,400,000 1,895,222 (367,346) Transfers in 195,000 438,189 113,077 (325,112)
Transfers out (169,255) (167,084) (151,029) 16,055
Total other financing sources (uses) 3,425,745 2,533,673 1,857,270 (676,403) Net change in fund balance (690,135) (690,135)
Fund balance (deficit), beginning of fiscal year (361,241) (361,241) (361,241) Fund balance (deficit), end of the fiscal year (361,241) $ (361,241) $ (1,051,376) $ $ (690,135) 62 Measurement Measurement Measurement
Date Date Date
June 30, 2016* June 30, 2015* June 30, 2014*
FY 2016-17 FY 2015-16 FY 2014-15
Plan's proportion of the Net Pension
Liability (Asset) 0.03384% 0.02343% 0.02005%
Plan's proportionate share of the Net Pension
Pension Liability (Asset) 8,359,216 $ 6,358,590 $ 5,310,907 $ Covered employee payroll*** 6,380,226 $ 6,246,307 $ 3,097,235 $ Plan's proportionate share of the Net Pension
Liability (Asset) as a percentage of its covered
employee payroll. 131.02% 101.80% 171.47%
Plan's fiduciary net position (in thousands) 24,705,532 $ 27,141,897 $ 26,493,201 $ Plan's fiduciary net position as a percentage of the
Plan's Total Pension Liability 74.06% 81.02% 81.92%
*Historical information is required only for measurement periods for which GASB 68 is applicable. **Fiscal year 2015 was the 1st year of implementation, therefore only three years are shown. ***Covered-Employee Payroll represented above is based on pensionable earnings provided by the employer.

However, GASB 68 defined covered-employee payroll as the total of employees that are provided pensions through the pension plan. Accordingly, if pensionable earnings are different from total earnings for covered-employees, the employer should display in the disclosure footnotes the payroll based on total earnings for the covered group and recalculate the required payroll-related ratios.

Schedule of Plan's Proportionate Share of the Net Pension Liability and Related Ratios

CITY OF TAFT

REQUIRED SUPPLEMENTARY INFORMATION
June 30, 2017
Cost Sharing Defined Benefit Pension Plan
Last 10 Fiscal Years**
63 64
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FY 2016-17* FY 2015-16* FY 2014-15*
Actuarially Determined Contribution** 916,163 $ 776,336 $ 1,221,754 $ Contributions in Relation to the Actuarially Determined Contribution** Determined Contribution ** (916,163) (776,336) (1,221,754) Contribution Deficiency (Excess) - $ - $ - $
Covered Employee Payroll**** 6, $ 6,246,307 380,226 $ 3,097,235 $ Contributions as a Percentage of Covered
Employee Payroll**** 14.36% 12.43% 39.45%
* Historical information is required only for measurement periods for which GASB 68 is applicable. **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. CalPERS has determined that employer obligations referred to as "side funds" do not conform to the circumstances described in paragraph 120 of GASB 68, therefore are not considered separately finance liabilities.
*** Fiscal year 2015 was the 1st year of implementation, therefore only three years are shown. ****Covered-Employee Payroll represented above is based on pensionable earnings provided by the employer. However, GASB 68 defined covered-employee payroll as the total of employees that are provided pensions through the pension plan Accordingly, if pensionable earnings are different from total earnings for covered-employees, the employer should display in the disclosure footnotes the payroll based on total earnings for the covered group and recalculate the required payrollrelated ratios.

Notes to Schedule:

The actuarial methods and assumptions used to set the actuarially determined contributios for Fiscal Year 2016-17 were from the June 30, 2014 public agency valuations.

Actuarial Cost Method Entry Age Normal
Amortization Method/Period For detail, see June 30, 2014 Funding Valuation Report
Asset Valuation Method Actuarial Value of Asseets. For details, see June 30, 2014 Funding Valuation Report.

Inflation 2.75%
Salary Increases 3.00%
Investment Rate of Return 7.65% Net of Pension Plan Investment and Administrative Expenses; includes Inflation.

Retirement Age Based on the 2010 CalPERS Experience
Study for the period from 1997 to 2007.

Mortality Based on the 2010 CalPERS Experience
Study for the period from 1997 to 2007.

Pre-retirement and Post-retirement mortality
rates included 5 years of projected mortality
improvement using Scale AA published by
the Society of Actuaries.

Schedule of Contributions *

CITY OF TAFT

REQUIRED SUPPLEMENTARY INFORMATION
June 30, 2017
Cost Sharing Defined Benefit Pension Plan
Last 10 Fiscal Years***
65 66
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67 CITY OF TAFT

MAJOR CAPTIAL PROJECT FUND
JUNE 30, 2017
WWTP Capital Projects Fund
The WWTP Capital Projects Fund is used to account for capital asset acquisition and construction of the wastewater treatment plant.

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

WWTP CAPITAL PROJECTS FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Final Budget
Actual
Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Use of money and property 19,953 $ 33,350 $ 13,397 $
Total revenues 19,953 33,350 13,397

OTHER FINANCING SOURCES (USES)
Transfers in 147,255 131,200 (16,055)
Transfers out (167,208) (113,077) 54,131
Total other financing sources (uses) (19,953) 18,123 38,076 Net change in fund balance 51,473 51,473
Fund balance, beginning of fiscal year 3,705,446 3,705,446 Fund balance, end of the fiscal year 3,705,446 $ 3,756,919 $ $ 51,473 68 69

CITY OF TAFT

NON-MAJOR GOVERNMENTAL FUNDS
JUNE 30, 2017

SPECIAL REVENUE FUNDS
Traffic Safety
This Fund was established to receive the City’s share of traffic fines and reimburse the General Fund for police activities related to traffic safety and traffic control devices.

Gas Tax
This fund was established to receive a share of the revenues derived from the State taxes on gasoline.

Inmate Welfare Trust
The inmate welfare trust fund account is established and maintained pursuant to Penal Code Sections 5005, 5006.1, 5007, and 5008 and the Business Administration Manual, Chapter 4200. All entries to the inmate welfare trust fund are supported by source documentation.

Transportation and Development Act (TDA)
This fund was established to receive and expend the City’s allocation of sales tax under SB 325. This bill reduced the State’s percentage of sales tax by 1.4 percent and allowed the counties within the State of California to increase their sales tax percentage by ¼ percent. The funds generated by this ¼ percent are allocated to the counties and a portion of this is then allocated to the cities within each county and restricted to street purposes.

Community Development Block Grant Home - 6859
This fund was established to account for business assistance loans under one of the City’s grant programs.

Cal Home Revolving Loan
This fund was established to account for all CalHome grant received by the City.

Tarp Revolving Loan
This fund was established to account for funds received from the State of California CDBG program whose intent is to provide financing to new and existing businesses for a healthy economic environment.

Asset Forfeiture
This fund was established to receive funds that are seized from narcotics dealers or following the sale of dealer assets.

Landscape Assessment District
This fund was established in connection with a single-family housing development project (Tract No. 5574) and will be used to record expenditures and revenues relative to formation and operation of a Landscape Maintenance District in that tract.

Crime Prevention
This fund was established to account for receipts from the State COPS grant program and related expenditures.
70 This page intentionally left blank

CITY OF TAFT

NON-MAJOR GOVERNMENTAL FUNDS

COMBINING BALANCE SHEET
June 30, 2017
Traffic Safety Gas Tax
Inmate Welfare
Trust TDA
ASSETS
Cash and investments $ 103,629 16,384 $ 39,300 $ 90,382 $ Receivables:

Interest 87
Notes
Prepaid items 193
Total assets 16,384 $ 103,716 $ 39,493 $ 90,382 $

LIABILITIES, DEFERRED INFLOW OF RESOURCES, AND FUND BALANCES

LIABILITIES
Accounts payable $ - - $ 557 $ - $
Accrued payroll 354
Due to other funds
Total liabilities 911

DEFERRED INFLOW OF RESOURCES
Deferred revenue

FUND BALANCES
Nonspendable 193
Restricted 16,384 103,716 38,389 90,382
Unassigned
Total fund balances (deficits) 16,384 103,716 38,582 90,382 Total liabilities, deferred inflow
of resources, and fund balances 16,384 $ 103,716 $ 39,493 $ 90,382 $

Special Revenue Funds
71 CDBG Home -
6859
Cal Homes
Revolving
Loan Fund
TARP
Revolving Loan Asset Forfeiture
Landscape
Assessment
District
Crime
Prevention
Total NonMajor
Governmental
Funds
$ - - $ 275,754 $ 74,283 $ - $ 54,995 $ $ 654,727

64 228 77
312,444 63,003 375,447
45 34,201 34,439
$ 312,444 - $ 338,757 $ 74,347 $ 45 $ 89,273 $ 1,064,841 $ - - $ - $ 2,158 $ 2,470 $ - $ 5,185
200 1,637 2,191
208,790 54,572 263,362
2,158 208,790 57,242 1,637 270,738
312,444 63,003 375,447
45 34,201 34,439
275,754 72,189 53,435 650,249
(208,790) (57,242) (266,032)
275,754 (208,790) 72,189 (57,197) 87,636 418,656
$ 312,444 - $ 338,757 $ 74,347 $ 45 $ 89,273 $ 1,064,841 $

Special Revenue Funds
72 73
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CITY OF TAFT

NON-MAJOR GOVERNMENTAL FUNDS

COMBINING STATEMENT OF REVENUES, EXPENDITURES,

AND CHANGES IN FUND BALANCES
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Traffic Safety Gas Tax
Inmate Welfare
Trust TDA

REVENUES
Fines and forfeitures $ - 15,907 $ - $ - $
Use of money and property 1,125 35
Intergovernmental 102,234
Current services charges 58,700
Other 4,499
Total revenues 103,359 15,907 63,234

EXPENDITURES
Current:

Public safety
Public works
Health and welfare 61,004
Community development
Total expenditures 61,00 4
Excess of revenues
over (under) expenditures 15,907 103,359 2,230

OTHER FINANCING SOURCES (USES)
Transfers out
Total other financing sources (uses)
Net changes in fund balances 15,907 103,359 2,230
Fund balances (deficits), beginning of fiscal year 357 477 36,352 90,382 Fund balances (deficits), end of fiscal year $ 103,716 16,384 $ 38,582 $ 90,382 $ Special Revenue Funds
74 CDBG Home -
6859
Cal Homes
Revolving
Loan Fund
TARP
Revolving Loan Asset Forfeiture
Landscape
Assessment
District
Crime
Prevention
Total NonMajor
Governmental
Funds
$ - - $ - $ - $ - $ - $ $ 15,907
769 5 792 2,726
68,000 6,792 28,570 129,324 334,920
11,005 69,705
4,499
68,000 6,792 29,339 11,010 130,116 427,757
19,889 97,335 117,224
18,685 18,685
61,004
215,582 215,582
19,889 215,582 18,685 97,335 412,495
68,000 (208,790) 9,450 (7,675) 32,781 15,262
(14,629 ) (14,629)

(14,629 (14,629) )
68,000 (208,790) (5,179) (7,675) 32,781 633

207,754 77,368 (49,522) 54,855 418,023
$ - (208,790) $ 275,754 $ 72,189 $ (57,197) $ 87,636 $ 418,656 $ Special Revenue Funds
75 CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

TRAFFIC SAFETY SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Fines and forfeitures 15,780 $ 15,907 $ 127 $
Total revenues 15,907 15,780 127

OTHER FINANCING SOURCES (USES)
Transfers out 15,780 (15,780)
Total other financing sources (uses) (15,780) 15,780
Net change in fund balance 15,907 15,907
Fund balance, beginning of fiscal year 477 477
Fund balance, end of fiscal year $ 16,384 477 $ 15,907 $ 76 CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

GAS TAX SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Use of money and property $ 1,125 815 $ 310 $
Intergovernmental 102,234 258,882 (156,648)
Total revenues 103,359 259,697 (156,338)

OTHER FINANCING SOURCES (USES)
Transfers out 259,697 (259,697)
Total other financing sources (uses) (259,697) 259,697
Net change in fund balance 103,359 103,359
Fund balance, beginning of fiscal year 357 357
Fund balance, end of fiscal year $ 103,716 357 $ 103,359 $ 77 CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

INMATE WELFARE TRUST SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Use of money and property $ 35 25 $ 10 $
Current service charges 43,804 58,700 14,896
Other 3,655 4,499 844
Total revenues 63,234 47,484 15,750

EXPENDITURES
Current:

Health and welfare 47,484 61,004 (13,520)
Total expenditures 47,484 61,004 (13,520)
Net change in fund balance 2,230 2,230
Fund balance, beginning of fiscal year 36,352 36,352
Fund balance, end of fiscal year $ 38,582 36,352 $ 2,230 $ 78 CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

TDA SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Intergovernmental $ - 50,000 $ (50,000) $
Total revenues (50,000) 50,000

OTHER FINANCING SOURCES (USES)
Transfers out 50,000 (50,000)
Total other financing sources (uses) (50,000) 50,000
Net change in fund balance
Fund balance, beginning of fiscal year 90,382 90,382
Fund balance, end of fiscal year $ 90,382 90,382 $ - $
79 CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

ASSET FORFEITURE SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Use of money and property $ 769 500 $ 269 $
Intergovernmental 28,570 28,571 (1)
Total revenues 29,339 29,071 268

EXPENDITURES
Current:

Public safety 16,933 19,889 (2,956)
Total expenditures 16,933 19,889 (2,956)
Excess (deficiency) of revenues
over expenditures 9,450 12,138 (2,688)

OTHER FINANCING SOURCES (USES)
Transfers out (14,629) (12,138) (2,491)
Total other financing sources (uses) (12,138) (14,629) (2,491) Net change in fund balance (5,179) (5,179)
Fund balance, beginning of fiscal year 77,368 77,368
Fund balance, end of fiscal year $ 72,189 77,368 $ (5,179) $ 80 CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

LANDSCAPE ASSESSMENT SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Use of money and property $ 5 5 $ - $
Current service charges 10,962 11,005 43
Total revenues 11,010 10,967 43

EXPENDITURES
Current:

Public works 18,482 18,685 (203)
Total expenditures 18,482 18,685 (203)
Excess (deficiency) of revenues
over expenditures (7,675) (7,515) (160)

OTHER FINANCING SOURCES (USES)
Transfers out 7,515 (7,515)
Total other financing sources (uses) (7,515) 7,515
Net change in fund balance (15,030) (7,675) 7,355
Fund balance (deficit), beginning of fiscal year (49,522) (49,522) Fund balance (deficit), end of fiscal year (64,552) $ (57,197) $ 7,355 $ 81 CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

CRIME PREVENTION SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Use of money and property $ 792 220 $ 572 $
Intergovernmental 129,324 114,618 14,706
Total revenues 130,116 114,838 15,278

EXPENDITURES
Current:

Public safety 81,046 97,335 (16,289)
Total expenditures 81,046 97,335 (16,289)
Excess (deficiency) of revenues
over expenditures 32,781 33,792 (1,011)

OTHER FINANCING SOURCES (USES)
Transfers out 33,792 (33,792)
Total other financing sources (uses) (33,792) 33,792
Net change in fund balance 32,781 32,781
Fund balance, beginning of fiscal year 54,855 54,855
Fund balance, end of fiscal year $ 87,636 54,855 $ 32,781 $ 82 83

CITY OF TAFT

PRIVATE-PURPOSE TRUST FUNDS AND AGENCY FUNDS
JUNE 30, 2017
Private-Purpose Trust Funds are used to account for assets and liabilities held by the City of Taft in a trustee capacity.

Capital Projects Fund
This fund is used to account for capital assets and other activities of the former redevelopment agency.

Post RDA Debt Retirement
This fund is used to account for administration and debt retirement activities related to the former redevelopment agency.

AGENCY FUNDS DESCRIPTION
Trust and agency funds were established to control money held by the City as agent or trustee. The collections reflected in these funds are not revenues to the City and disbursements do not represent expenditures of the City. Accordingly, these funds do not employ the budgetary accounting procedures used for the other funds.

Inmate Trust Fund
The Inmate Trust Account maintains those accounting records necessary to provide for the recording of all transactions affecting the inmate trust accounts. It also provides accurate and current information relative to each individual inmate trust account.
1997-A Lease Revenue Bond
This fund is used to account for resources held related to nonobligatory conduit debt. The City acts as an agent by collecting payments and forwarding them to a trustee on behalf of the bondholders. 84 This page intentionally left blank

CITY OF TAFT

COMBINING STATEMENT OF NET POSITION

PRIVATE PURPOSE TRUST FUNDS
JUNE 30, 2017
Capital Projects
Post RDA Debt
Retirement Total
ASSETS
Cash and investments $ 54,332 - $ $ 54,332
Cash and investment with fiscal agents 453,806 453,806
Interest receivable 1,152 1,152
Prepaid items 133 133
Capital assets - nondepreciable 1,698,163 1,698,163
Capital assets - being depreciated 407,116 407,116
Capital assets - accumulated depreciation (236,306) (236,306) Total assets 1,868,973 509,423 2,378,396

LIABILITIES
Accounts payable 84 84
Accrued payroll 891 891
Accrued interest payable 83,375 83,375
Advance due to City of Taft 1,588,959 1,588,959
Bonds payable 2,875,000 2,875,000
Total liabilities 4,548,309 4,548,309

NET POSITION (DEFICIT)
Restricted for debt service 370,431 370,431
Unrestricted 1,868,973 (4,409,317) (2,540,344)
Total Net Position (Deficit) 1,868,973 $ (4,038,886) $ (2,169,913) $

85 CITY OF TAFT

PRIVATE PURPOSE TRUST FUNDS

COMBINING STATEMENT OF CHANGES IN NET POSITION
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Capital Projects
Post RDA Debt
Retirement Total
Additions:

Investment revenue $ 124,067 - $ $ 124,067
Taxes and assessments 265,530 265,530
Total additions 389,597 389,597
Deductions:

Community development 63,528 63,528
Interest expense 167,417 167,417
Depreciation 10,178 10,178
Total deductions 10,178 230,945 241,123
Change in net position 158,652 (10,178) 148,474
Net Position (Deficit) - July 1, 2016 1,879,151 (4,197,538) (2,318,387) Net Position (Deficit) - June 30, 2017 1,868,973 $ (4,038,886) $ (2,169,913) $ 86 CITY OF TAFT

COMBINING STATEMENT OF ASSETS AND LIABILITIES

AGENCY FUNDS
JUNE 30, 2017
Inmate Trust
Fund
1997-A Lease
Revenue Bond Total
ASSETS
Cash and investments $ 559 67,937 $ $ 68,496
Total assets 67,937 $ 559 $ 68,496 $

LIABILITIES
Accounts payable $ - 11,497 $ $ 11,497
Deposits payable 559 559
Due to inmates 56,440 56,440
Total liabilities 67,937 $ 559 $ 68,496 $

87 CITY OF TAFT

FIDUCIARY FUNDS - AGENCY FUNDS

COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FOR THE FISCAL YEAR ENDED JUNE 30, 2017
July 1, 2016
Balance Additions Reductions
June 30, 2017
Balance
ASSETS
Cash and investments 85,634 $ 403,637 $ (421,334) $ 67,937 $ Total assets 85,634 $ 403,637 $ (421,334) $ 67,937 $

LIABILITIES
Accounts payable 23,911 $ 433,559 $ (445,973) $ 11,497 $ Due to inmates 61,723 412,924 (418,241) 56,440
Total liabilities 85,634 $ 846,483 $ (864,214) $ 67,937 $ July 1, 2016
Balance Additions Reductions
June 30, 2017
Balance
ASSETS
Cash and investments 559 $ - $ - $ 559 $
Total assets 559 $ - $ - $ 559 $

LIABILITIES
Deposits payable 559 $ - $ - $ 559 $
Total liabilities 559 $ - $ - $ 559 $
July 1, 2016
Balance Additions Reductions
June 30, 2017
Balance
ASSETS
Cash and investments 86,193 $ 403,637 $ (421,334) $ 68,496 $ Total assets 86,193 $ 403,637 $ (421,334) $ 68,496 $

LIABILITIES
Accounts payable 23,911 $ 433,559 $ (445,973) $ 11,497 $ Due to inmates 61,723 412,924 (418,241) 56,440
Deposits payable 559 559
Total liabilities 86,193 $ 846,483 $ (864,214) $ 68,496 $ Total
Inmate Trust Fund
1997-A Lease Revenue Bond
88 WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS

SANITATION DISTRICT

FINANCIAL STATEMENTS
JUNE 30, 2017

THIS PAGE INTENTIONALLY LEFT BLANK

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS

SANITATION DISTRICT

FINANCIAL STATEMENTS
JUNE 30, 2017
Table of Contents
INDEPENDENT AUDITOR’S REPORT 1
BASIC FINANCIAL STATEMENTS:

Government-wide Financial Statements
Statement of Net Position 3
Statement of Activities 4
Fund Financial Statements
Balance Sheet – Governmental Funds 5
Reconciliation of the Governmental Funds Balance Sheet
to the Statement of Net Position 6
Statement of Revenues, Expenditures, and Changes in Fund Balances – Governmental Funds 7
Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Statement of Activities 8 Notes to the Basic Financial Statements 9

REQUIRED SUPPLEMENTARY INFORMATION
Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual – Special Revenue Fund 16

OTHER SUPPLEMENTARY INFORMATION
Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual – Capital Projects Fund 17
1 OFFICES: BEVERLY HILLS ∙ CULVER CITY ∙ SANTA MARIA MEMBER AMERICAN INSTITUTE OF C.P.A.’s • CALIFORNIA SOCIETY OF C.P.A.’s • CALIFORNIA SOCIETY OF MUNICIPAL FINANCE OFFICERS • CALIFORNIA ASSOCIATION OF SCHOOL

BUSINESS OFFICIALS

PARTNERS COMMERCIAL ACCOUNTING & TAX SERVICES GOVERNMENTAL AUDIT SERVICES RONALD A LEVY, CPA 433 N. CAMDEN DRIVE, SUITE 730 5800 HANNUM AVENUE, SUITE E CRAIG A HARTZHEIM, CPA BEVERLY HILLS, CA 90210 CULVER CITY, CA 90230 HADLEY Y HUI, CPA TEL: 310.273.2745 TEL: 310.670.2745
ALEXANDER C HOM, CPA FAX: 310.670.1689 FAX: 310.670.1689 ADAM V GUISE, CPA www.mlhcpas.com www.mlhcpas.com

TRAVIS J HOLE, CPA
INDEPENDENT AUDITOR’S REPORT
To the Board of Directors
City of Taft/Ford City-Taft Heights
Sanitation District
Taft, California
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities and each major fund of the Wastewater Treatment Plant of the City of Taft / Ford City-Taft Heights Sanitation District (the WWTP), as of and for the fiscal year ended June 30, 2017, which collectively comprise the WWTP’s basic financial statements, as listed in the table of contents.

Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes 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.

Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and each major fund of the Wastewater Treatment Plant of the City of Taft / Ford City-Taft Heights Sanitation District, California, as of June 30, 2017, and the respective changes in financial position, for the fiscal year then ended in accordance with accounting principles generally accepted in the United States of America.

Other Matters
Required Supplementary Information
Management has omitted the Management’s Discussion and Analysis that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, although not part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. Our opinion on the basic financial statements is not affected by this missing information.

Accounting principles generally accepted in the United States of America require that the budgetary comparison information on page 16 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the WWTP’s basic financial statements. The Schedule of Revenues, Expenditures, and Changes in Fund Balance, Budget and Actual – Capital Projects Fund is presented for the purpose of additional analysis and is not a required part of the basic financial statements. The Schedule of Revenues, Expenditures, and Changes in Fund Balance, Budget and Actual – Capital Projects Fund is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying 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 information is fairly stated in all material respects in relation to the basic financial statements taken as a whole.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated July 18, 2018, on our consideration of the WWTP’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, grant agreements, and other matters. The purpose of that report is 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 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 WWTP’s internal control over financial reporting and compliance.

Moss, Levy & Hartzheim, LLP
Culver City, California
July 18, 2018
2 GOVERNMENT-WIDE FINANCIAL STATEMENTS
ASSETS
Current Assets:

Cash and investments $ 2,339,875
Accounts receivable 308,739
Interest receivable 3,031
Prepaid expenses 512
Total Current Assets 2,652,157
Noncurrent Assets:

Capital assets:

Non-depreciable:

Land 32,519
Construction-in-progress 3,948,117
Depreciable, net of accumulated depreciation:

Machinery and equipment
Structures and improvements 626,553
Total Noncurrent Assets 4,607,189
Total Assets 7,259,346

LIABILITIES
Current Liabilities:

Accounts payable 38,077
Accrued payroll 2,185
Interest payable 5,186
Compensated absences 9,228
Certificates of participation (COP) payable 64,000
Total Current Liabilities 118,676
Certificates of participation (COP) payable 2,135,568
Total Noncurrent Liabilities 2,135,568
Total Liabilities 2,254,244

NET POSITION
Net investment in capital assets 2,407,621
Restricted 2,597,481
Total Net Position 5,005,102 $
3 WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY - TAFT HEIGHTS SANITATION DISTRICT

STATEMENT OF NET POSITION
JUNE 30, 2017
Governmental
Activities
The notes to the basic financial statements are an integral part of this statement.

Net
(Expense)/Revenue
and Changes in
Net Position
Governmental
Expenses Activities
Governmental Activities:

General government $ 31,587 1,095,068 $ 713,997 $ - $ (349,484) $ Interest and fiscal charges 30,648 (3 0,648)
Total Governmental Activities 1,125,716 $ 31,587 $ 713,997 $ - $ (380,132) General Revenues:

Investment earnings 33,350
Total General Revenues 33,350
Change in Net Position (346,782)
Net Position, Beginning of Fiscal Year 5,351,884
Net Position, End of Fiscal Year 5,005,102 $
The notes to basic financial statements are an integral part of this statement.

Function/Program
4 Program Revenues

WASTEWATER TREATMENT PLANT
Charges for
Services
Operating
Grants and
Contributions
Capital
Grants and
Contributions

CITY OF TAFT / FORD CITY - TAFT HEIGHTS SANITATION DISTRICT

STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED JUNE 30, 2017

FUND FINANCIAL STATEMENTS
ASSETS
Cash and investments $ - 2,339,875 $ 2,339,875 $
Accounts receivable 308,739 308,739
Interest receivable 3,031 3,031
Due from other funds 1,414,013 1,414,013
Prepaid items 512 512
Total Assets $ 309,251 3,756,919 $ 4,066,170 $

LIABILITIES AND FUND BALANCES

LIABILITIES
Accounts payable $ 38,077 - $ 38,077 $
Accrued payroll 2,185 2,185
Due to other funds 1,414,013 1,414,013
Total Liabilities 1,454,275 1,454,275

FUND BALANCES
Nonspendable 512 512
Restricted 3,756,919 3,756,919
Unassigned (1,145,536) (1,145,536)
Total Fund Balances (1,145,024) 3,756,919 2,611,895
Total Liabilities and Fund Balances $ 309,251 3,756,919 $ 4,066,170 $ The notes to basic financial statements are an integral part of this statement. 5 WWTP
Capital
Projects
WWTP
Special
Revenue
Total
Governmental
Funds

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY - TAFT HEIGHTS SANITATION DISTRICT

BALANCE SHEET - GOVERNMENTAL FUNDS
JUNE 30, 2017
Fund Balances of Governmental Funds 2,611,895 $
Amounts reported for governmental activities in the statement of net position are different because:

Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the governmental funds. This balance reflects WWTP's compensated absences. (9,228 ) Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the governmental funds. This balance reflects WWTP's certificates of participation (COP) payable. (2,199,568) Interest payable are not due and payable in the current period and, therefore, are not reported in the governmental funds. This balance reflects WWTP's interest payable on the COP payable. (5,1 86) Capital assets, net of accumulated depreciation, used in governmental activities are not current financial resources and, therefore, are not reported in the governmental funds. 4,607,189 Net Position of Governmental Activities 5,005,102 $
The notes to the basic financial statements are an integral part of this statement. 6 WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY - TAFT HEIGHTS SANITATION DISTRICT

RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET

TO THE STATEMENT OF NET POSITION
JUNE 30, 2017

REVENUES
Intergovernmental $ 713,997 - $ 713,997 $
Use of money and property 33,350 33,350
Charges for services 31,587 31,587
Total Revenues 745,584 33,350 778,934

EXPENDITURES
Current:

General government 1,039,572 1,039,572
Capital outlay 2,273,246 2,273,246
Debt Service:

Principal retirement 63,000 63,000
Interest and fiscal charges 30,648 30,648
Total Expenditures 3,406,466 3,406,466
Excess (Deficiency) of
Revenues Over Expenditures (2,660,882) 33,350 (2,627,532)

OTHER FINANCING SOURCES (USES)
Proceeds from issuance of debt 1,895,222 1,895,222
Transfers in 113,077 131,200 244,277
Transfers out (131,200) (113,077) (244,277)
Total Other Financing Sources (Uses) 1,877,099 18,123 1,895,222 Net Change in Fund Balances (783,783) 51,473 (732,310)
Fund Balances (Deficit), Beginning of Fiscal Year (361,241) 3,705,446 3,344,205 Fund Balances (Deficit), End of Fiscal Year $ (1,145,024) 3,756,919 $ 2,611,895 $ The notes to basic financial statements are an integral part of this statement. 7 WWTP
Capital
Projects
WWTP
Special
Revenue
Total
Governmental
Funds

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY - TAFT HEIGHTS SANITATION DISTRICT

STATEMENT OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Net Change in Fund Balances of Governmental Funds $ (732,310) Amounts reported for governmental activities in the Statement of Activities differs from the amounts reported in the Statement of Revenues, Expenditures, and Changes in Fund Balances because:

Governmental funds report capital outlay as expenditures. However, in the statement of activities, the costs of those assets are allocated over their estimated useful lives as depreciation expense.

This activity is reconciled as follows:

Cost of assets capitalized 2,273,246 $
Depreciation 2,224,429 (48,817)
In governmental funds, proceeds from debt issuance are recognized as other financing sources.

In the government-wide statements, proceeds from debt are reported as increases of liabilities. (1,895,222)
Debt repayments are reported as expenditures in the govermental funds.

The repayment is not an expense in the statement of activities, as it is a reduction of a long-term liability. This amount reflects the principal paid on the Certificates of Participation for the period. 63,000 Governmental funds report interest in the fiscal year it is paid; however, in the statement of activities interest is recorded in the fiscal year it is incurred. (5,186) Debt repayments are reported as expenditures in the governmental funds.

The repayment is not an expense in the statement of activities, as it is a reduction of a long-term liability. This amount reflects the difference between compensated absences accrued and compensated absences paid for the period. (1,493) Change in Net Position of Governmental Activities (346,782) $ The notes to the basic financial statements are an integral part of this statement. 8 WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY - TAFT HEIGHTS SANITATION DISTRICT

RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES,

AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED JUNE 30, 2017

NOTES TO THE BASIC FINANCIAL STATEMENTS

WASTEWATER TREATMENT PLANT
CITY OF TAFT / FORD CITY – TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The primary function of this organization is the operation and maintenance of the sewer treatment facility serving the City of Taft (the City) and the Ford City-Taft Heights Sanitation District. In accordance with the terms of the “Joint Exercise of Powers Agreements” between the City of Taft, Taft Heights, and Ford City Sanitation District dated May 29, 1950, amended March 7, 1966, restated April 24, 1972, and restated August 21, 1991, covering the “Joint Sewage Project – 1972,” the City of Taft was designated to act on its own behalf and on behalf of each of the other agencies, to operate and maintain the Wastewater Treatment Plant (WWTP). All costs to operate and maintain the facilities shall be paid by the City of Taft and the other agencies in the following cost share ratios:
52 percent shall be paid by the City of Taft
19 percent shall be paid by the Taft Heights Sanitation District 29 percent shall be paid by the Ford City Sanitation District The WWTP has access to the services and facilities of the City and the City’s staff. The City assists the WWTP in the planning, financing, acquisition, construction, and maintenance or operation of the activities undertaken by the WWTP in accordance with the agreements and the applicable state and federal law. The costs incurred and paid by the City on behalf of the WWTP may include a part of the salaries and benefits of the City officers and employees who performed services for the WWTP, and are reimbursed by the WWTP.

The financial statements of the WWTP have been prepared in accordance with accounting principles generally accepted in the United States of America (USGAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the standard-setting body for governmental accounting and financial reporting. The more significant of the accounting principles are described below:

A. Reporting Entity
The City of Taft operates the WWTP pursuant to the Joint Exercise of Powers Agreement noted above.

The WWTP is not a separate legal entity and therefore is not included as a component unit of the City.

Because of the City’s oversight responsibilities, the funds of the WWTP are included within the fund structure of the City. The financial statements of the WWTP do not purport to, and do not, present fairly the financial position of the City of Taft as a whole or the Ford City or Taft Heights Sanitation Districts as a whole.

B. Fund Accounting
The accounts of the Wastewater Treatment Plant are organized on the basis of funds, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues, and expenditures. Government resources are allocated to and accounted for in individual funds based upon the purpose for which they are to be spent and the means by which spending activities are controlled.

The WWTP uses two funds as follows:

Capital Projects Fund – the Capital Projects Fund is used to account for financial resources to be used for the acquisition or construction of major capital facilities.

Special Revenue Fund – the Special Revenue Fund is used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specific purposes. 9 WASTEWATER TREATMENT PLANT
CITY OF TAFT / FORD CITY – TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Basis of Accounting/Measurement Focus
Consistent with the City’s implementation of GASB Statement No. 34, Basic Financial Statements and Management’s Discussion and Analysis – for State and Local Governments, the WWTP financial statements report information on both the accrual and modified accrual basis of accounting. The differences between the two presentations are discussed below.

Statement of Net Position and the Statement of Activities The Statement of Net Position and the Statement of Activities are presented on an “economic resources” measurement focus and the accrual basis of accounting. Accordingly, all the WWTP’s assets and liabilities, including capital assets, are included in the accompanying Statement of Net Position. The Statement of Activities presents changes in net position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned and expenses are recognized when the liability is incurred. Interfund activities (such as transfers) are eliminated from these statements.

Balance Sheet and Statement of Revenues, Expenditures, and Changes in Fund Balance Governmental fund financial statements include a Balance Sheet and a Statement of Revenues, Expenditures, and Changes in Fund Balance for each fund. A separate statement is presented to report the differences in fund balance as presented in these statements to the net position presented in the Statement of Net Position. All governmental funds are accounted for on a “spending” or “financial flow” measurement focus and the modified accrual basis of accounting. Accordingly, only current assets and current liabilities are generally included on their balance sheets. Their reported fund balance is their net current assets, which is considered only to be a measure of available resources. Governmental fund operating statements present a summary of sources and uses of available resources during a period by presenting increases and decreases in net position. Under the modified accrual basis of accounting, revenues are recognized in the accounting period in which they become measurable and available to finance expenditures of the current period. Accordingly, revenues are recorded when received in cash, except that revenues subject to accrual (generally 60 days after fiscal year end) are recognized when due.

Revenues susceptible to accrual are investment earnings and assessments from member governments.

Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred, except for principal and interest on long term obligations which are recognized when due. Because of their current financial resources focus, expenditure recognition for governmental fund types excludes amounts represented by non-current liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund expenditures or fund liabilities.

D. Budgetary Policy and Control

1. General Budget Policies
The Taft City Council approves each fiscal year’s budget for the WWTP as part of the overall City budget submitted by the City Manager prior to the beginning of the new fiscal year. Public hearings are conducted prior to its adoption by the Council. All appropriations lapse at year-end. The City Council has the legal authority to amend the budget at any time during the fiscal year. The City Manager has the authority to make adjustments to the operating budget within program areas.

Transfers of operating budget appropriations between program areas or to or from appropriated reserve accounts, use of unappropriated fund balances, cancellation of appropriations and all changes in capital improvement project budgets require the approval of the City Council. 10 WASTEWATER TREATMENT PLANT
CITY OF TAFT / FORD CITY – TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Budgetary Policy and Control (Continued)

2. General Budget Policies
The City maintains budgetary controls to ensure compliance with legal provisions embodied in the appropriated budget approved by the City Council. The level of budgetary control (that is, the level at which expenditures cannot legally exceed the appropriated amount) for the operating budget that is the program area – total for all funds. Formal budgetary integration is employed as a management control device during the fiscal year for the Governmental Funds.

3. Encumbrances
Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of funds are recorded in order to reserve that portion of the applicable appropriation, is employed in the governmental funds. Encumbrances do not constitute expenditures or liabilities.

E. Cash/Investment Policy
In order to maintain an effective investment program, all cash is pooled with the cash and investments of the City of Taft and amounts not required for day-to-day financial transactions are invested as approved by the Taft City Council on a pooled basis and earnings are allocated to each fund on the basis of its average cash balance at the end of each quarter. Investments are carried at fair value.

F. Capital Assets and Depreciation
Capital assets, which include land, buildings, infrastructure, machinery, and equipment, are reported in the Statement of Net Position. Capital assets are defined as assets with an initial individual cost of more than $500. Sensitive items with costs below $500 are also included. Such assets are recorded at historical cost or estimated historical cost if actual historical cost is not available. Donated capital assets are valued at their estimated fair value on the date donated.

Capital assets are depreciated over their estimated useful lives using the straight-line method. This means the cost of the asset is divided by its expected useful life in years and the result is charged to expense each year until the asset is fully depreciated. The purpose of depreciation is to spread the cost of capital assets over the useful lives of these assets. The amount charged to depreciation expense each fiscal year represents that fiscal year’s pro-rata share of the cost of capital assets.

Depreciation of capital assets is charged as an expense against operations each year and the total amount of depreciation taken over the years, called accumulated depreciation, is a reduction in the book value of the capital assets. The WWTP has assigned the useful lives listed below to capital assets.

Structures and improvements 20-40 years
Machinery and equipment 5-20 years
G. Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. 11 WASTEWATER TREATMENT PLANT
CITY OF TAFT / FORD CITY – TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) H. Use of Restricted Resources
When both restricted and unrestricted resources are available for use, it is the WWTP’s policy to use restricted resources first, and then unrestricted resources as they are needed. Restricted resources are defined as resources received from outside agencies dedicated for specific projects or purposes.

NOTE 2 – CASH AND INVESTMENTS
The WWTP’s cash and investments are pooled with the funds of the City for deposit and investment purposes. Interest on pooled cash and investments is credited to the funds based on each prospective fund’s average cash balance at each quarter end. Detailed information concerning the City of Taft’s pooled cash and investments can be found in the City’s Annual Financial Report for the fiscal year ended June 30, 2017. The WWTP’s cash and investments balance at June 30, 2017 is $2,339,875.

The WWTP’s cash and investments are held within the City of Taft’s investment pool. As the WWTP does not hold specific investments or deposits in its name, the cash and investments are not evidenced by deposits or securities that exist in physical or book entry form.

The WWTP categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. These principles recognize a three-tiered fair value hierarchy. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. The WWTP had investments in the City of Taft’s investment pool (amortized cost), however, the external pool is not measured under Level 1, 2 or 3.

NOTE 3 – CAPITAL ASSETS
During the fiscal year ended June 30, 2017, the following changes in capital assets occurred:

Governmental Activities
Beginning
Balance
July 1, 2016 Additions Deletions
Ending
Balance
June 30, 2017
Capital Assets Not Being Depreciated:

Land 32,519 $ - $ - $ 32,519 $
Construction in Progress 1,674,871 2,273,246 3,948,117
Total Capital Assets Not Being Depreciated 1,707,390 2,273,246 3,980,636 Capital Assets, Being Depreciated:

Machinery and equipment 284,425 284,425
Structures and improvements 2,696,723 2,696,723
Total Capital Assets Being Depreciated 2,981,148 2,981,148 Less Accumulated Depreciation For:

Machinery and equipment (281,625) (2,800) (284,425)
Structures and improvements (2,024,153) (46,017) (2,070,170) Total Accumulated Depreciation (2,305,778) (48,817) (2,354,595) Total Capital Assets, Being Depreciated, Net 675,370 (48,817) 626,553 Governmental Activities Capital Assets, Net $ 2,224,429 2,382,760 $ - $ 4,607,189 $ Depreciation expense of $48,817 was charged to general government on the Statement of Activities for the fiscal year ended June 30, 2017.
12 WASTEWATER TREATMENT PLANT
CITY OF TAFT / FORD CITY – TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 4 – INTERFUND TRANSFERS
Interfund transfers as of June 30, 2017 were as follows:

Fund Transfers in Transfers out
WWTP Capital Projects 131,200 $ 113,077 $
WWTP Special Revenue 113,077 131,200
Total 244,277 $ 244,277 $
The transfer into the Capital Project Fund is for building a reserve that will be used at a future date for large maintenance projects and/or reconstruction of the facility. This is an agreed upon amount between all District members.

NOTE 5 – COMPENSATED ABSENCES
During the fiscal year ended June 30, 2017, the following changes occurred in the governmental activities compensated absences:

Governmental Activities
Balance
July 1, 2016 Additions Deletions
Balance
June 30, 2017
Due in
One Year
Compensated Absences 7,735 $ 9,228 $ (7,735) $ 9,228 $ 9,228 $ Total governmental activities
long-term debt $ 9,228 7,735 $ (7,735) $ 9,228 $ 9,228 $ Compensated Absences
The short-term portion of the liability is recorded in the various funds and is determined to be the amount due to employees for future absences, which is attributable to services already rendered, and which is expected to be paid during the next fiscal year. The long-term portion is recorded only in the Statement of Net Position.

As of June 30, 2017, all compensated absences are current.

NOTE 6 – CERTIFICATES OF PARTICIPATION PAYABLE
Certificates of Participation (COP) are long-term instruments which are tax exempt and therefore, issued at interest rates below current market levels for taxable investments.

On June 15, 2015, the WWTP has entered into a loan financing program with the United States Department of Agriculture, acting through its agency the USDA Rural Development, to finance a portion of the cost and expense of the acquisition and construction of certain improvements to the wastewater treatment system of the City of Taft, and in connection with the loan financing program, the City intends to cause the execution and delivery to USDA Rural Development of certificates of participation.

In support of the proposed Certificates of Participation, the City proposes to enter into a financing program with the Taft Public Improvement Corporation, a California nonprofit public benefit corporation duly organized and existing under and by virtue of the laws of the State of California (the "Corporation"), for the purchase by the Corporation of the real property on which the wastewater system is situated (the "Site"), together with the existing wastewater treatment system improvements (the "Existing Facilities") situated thereon, and the purchase by the City from the Corporation of the completed Project. 13 WASTEWATER TREATMENT PLANT
CITY OF TAFT / FORD CITY – TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 6 – CERTIFICATES OF PARTICIPATION PAYABLE (Continued) The City is in receipt of a Letter of Conditions, originally dated November 8, 2012 and extended through April 10, 2017 (the "Letter of Conditions"), from USDA Rural Development, setting forth certain conditions to be satisfied by the City with respect to receipt from USDA Rural Development of funding for the Project, comprised of a loan in the amount of not-to-exceed $3,619,000 to be represented by the Certificates of Participation. The Installment payments shall be payable during a period of not more than 40 years and the interest rate shall not exceed 1.75% per annum.

During the fiscal year 2016-17, the City spent $3,251,654 for the project which was completed in May 2017 but not put into service until after June 30, 2017. The City received loan funds of $1,895,222 during the fiscal year 2016-17 with the remaining certificates of participation issued of $1,356,432 disbursed to the City during FY 2017-18.

During the fiscal year ended June 30, 2017, the following changes occurred in the governmental activities Certificates of Participation Payable:

Governmental Activities
Balance
July 1, 2016 Additions Deletions
Balance
June 30, 2017
Due in
One Year
Certificates of Participation Payable 367,346 $ 1,895,222 $ (63,000) $ 2,199,568 $ 64,000 $ Total governmental activities
long-term debt $ 1,895,222 367,346 $ (63,000) $ 2,199,568 $ 64,000 $

Certificates of Participation maturity schedule:

Fiscal year ending
June 30, Principal Interest
2018 $ 64,000 $ 38,492
2019 65,000 37,373
2020 67,000 36,235
2021 68,000 35,062
2022 69,000 33,872
2023-2027 363,000 150,847
2028-2032 397,000 117,895
2033-2037 431,000 82,002
2038-2042 472,000 42,890
2043-2045 203,568 5,455
Totals $ 2,199,568 $ 580,123
Certificates of Participation
NOTE 7 – NET POSITION/FUND BALANCES
Net position is divided into three captions. These captions apply to net position as determined at the government-wide level and are described below:

Net Investment in Capital Asset describes the portion of net position which is represented by the current net book value of the District’s capital assets, less the outstanding balance of any debt issued to finance these assets.
14 WASTEWATER TREATMENT PLANT
CITY OF TAFT / FORD CITY – TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 7 – NET POSITION/FUND BALANCES (Continued)
Restricted describes the portion of net position which is restricted as to use by the terms and conditions of agreements with outside parties, governmental regulations, laws, or other restrictions which the District cannot unilaterally alter. These principally include debt service requirements.

Unrestricted describes the portion of net position which is not restricted as to use.

Fund balances are divided into five classifications based primarily on the extent to which the WWTP is bound to observe constraints imposed upon the use if the resources in the governmental funds. The classifications are as follows:

1. Nonspendable Fund Balance
That portion of a fund balance that includes amounts that cannot be spent because they are either (a) not in a spendable form, such as prepaid items, inventories of supplies, or loans receivable; or (b) legally or contractually required to be maintained intact, such as the principal portion of an endowment.

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

3. Committed Fund Balance
That portion of a fund balance that includes amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of the government’s highest level of decision making authority, and remain binding unless removed in the same manner.

4. Assigned Fund Balance
That portion of a fund balance that includes amounts that are constrained by the government’s intent to be used for specific purposes, but that are neither restricted nor committed. Such intent needs to be established at either the highest level of decision making, or by an official designated for that purpose.

Enabling legislation authorizes the WWTP to assess, levy, charge, or otherwise mandate payment of resources (from external resource providers) and includes legally enforceable requirements that those resources be used only for the specific purposes stipulated in the legislation. Legal enforceability means that the WWTP can be compelled by an external party, such as citizens, public interest groups, or the judiciary to use resources created by enabling legislation only for the purposes specified by the legislation.

5. Unassigned Fund Balance
That portion of a fund balance that includes amounts that do not fall into one of the above categories.

A General Fund is the only fund that should report this category of fund balance. 15 REQUIRED SUPPLEMENTARY INFORMATION
Original Final

REVENUES
Intergovernmental 4,202,081 $ 2,976,565 $ 713,997 $ (2,262,568) $ Charges for services 70,000 31,587 31,587
Total Revenues 4,272,081 2,976,565 745,584 (2,230,981)

EXPENDITURES
Current:

General government 887,826 1,020,491 1,019,743 748
Capital outlay 3,410,000 2,273,246 2,273,246
Debt service:

Principal retirement 63,000 (63,000)
Interest and fiscal charges 5,349 30,648 (25,299)
Total Expenditures 4,297,826 3,299,086 3,386,637 (87,551) Excess (Deficiency) of Revenues
Over Expenditures (25,745) (322,521) (2,641,053) (2,318,532)

OTHER FINANCING SOURCES (USES)
Proceeds from issuance of debt 1,895,222 1,895,222
Transfers in 195,000 438,189 113,077 (325,112)
Transfers out (169,255) (147,255) (151,029) (3,774)
Total other financing sources (uses) 25,745 290,934 1,857,270 1,566,336 Net Change in Fund Balance (31,587) (783,783) (752,196)

Fund Balance (Deficit), Beginning of Fiscal year (361,241) (361,241) (361,241) Fund Balance (Deficit), End of the Fiscal Year (361,241) $ (392,828) $ (1,145,024) $ (752,196) $

WASTEWATER TREATMENT PLANT
16 Variance with
Final Budget
Positive
(Negative)
Budgeted Amounts Actual
Amounts

CITY OF TAFT / FORD CITY - TAFT HEIGHTS SANITATION DISTRICT

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN

FUND BALANCE - BUDGET AND ACTUAL - SPECIAL REVENUE FUND FOR THE FISCAL YEAR ENDED JUNE 30, 2017

OTHER SUPPLEMENTARY INFORMATION
Final
Budget

REVENUES
Use of money and property $ 33,350 19,953 $ 13,397 $
Total Revenues 19,953 33,350 13,397

OTHER FINANCING SOURCES (USES)
Transfers in 131,200 147,255 (16,055)
Transfers out (113,077) (167,208) 54,131
Total other financing sources (uses) (19,953) 18,123 38,076 Net Change in Fund Balance 51,473 51,473
Fund Balance, Beginning of Fiscal Year 3,705,446 3,705,446 Fund Balance, End of the Fiscal Year 3,705,446 $ 3,756,919 $ 51,473 $ 17 Variance with
Final Budget
Positive
(Negative)
Actual
Amounts

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY - TAFT HEIGHTS SANITATION DISTRICT

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN

FUND BALANCE - BUDGET AND ACTUAL - CAPITAL PROJECTS FUND FOR THE FISCAL YEAR ENDED JUNE 30, 2017

CITY OF TAFT

SINGLE AUDIT REPORT
For the Fiscal Year Ended June 30, 2017
City of Taft
Single Audit Report
For the Fiscal Year Ended June 30, 2017

TABLE OF CONTENTS
Page
Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 1 Independent Auditor’s Report on Compliance For Each Major Program and on Internal Control over Compliance Required By Uniform Guidance 3
Schedule of Expenditures of Federal Awards 5
Notes to the Schedule of Expenditures of Federal Awards 6 Schedule of Findings and Questioned Costs 9
Status of Prior Year’s Findings 11
1 OFFICES: BEVERLY HILLS ∙ CULVER CITY ∙ SANTA MARIA
MEMBER AMERICAN INSTITUTE OF C.P.A.’S ∙ CALIFORNIA SOCIETY OF MUNICIPAL FINANCE OFFICERS ∙ CALIFORNIA ASSOCIATION OF SCHOOL BUSINESS OFFICIALS

PARTNERS COMMERCIAL ACCOUNTING & TAX SERVICES GOVERNMENTAL AUDIT SERVICES RONALD A LEVY, CPA 433 N. CAMDEN DR., SUITE 730 5800 HANNUM AVE, SUITE E CRAIG A HARTZHEIM, CPA BEVERLY HILLS, CA 90210 CULVER CITY, CA 90230 HADLEY Y HUI, CPA TEL: 310.273.2745 TEL: 310.670.2745
ALEXANDER C HOM, CPA FAX: 310.670.1689 FAX: 310.670.1689 ADAM V GUISE, CPA www.mlhcpas.com www.mlhcpas.com

TRAVIS J HOLE, CPA
INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL

REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF

FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING

STANDARDS
To the Honorable Mayor and Members of the City Council
of the City of Taft
Taft, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the businesstype activities, each major fund, and the aggregate remaining fund information of the City of Taft (City), California, as of and for the fiscal year ended June 30, 2017, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements, and have issued our report thereon dated July 18, 2018.

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

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

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that have not been identified. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. We did identify a deficiency in internal control, described in the accompanying schedule of findings and questioned costs as finding 2017-001, that we consider to be a significant deficiency,

2 Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed one instance of noncompliance or other matters that are required to be reported under Government Auditing Standards and which is described in the accompanying Schedule of Findings and Questioned Cost as item 2017-002.

City’s Response to Findings
The City’s response to the findings identified in our audit is described in the accompanying schedule of findings and questions costs. The City’s response was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it.

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

Moss, Levy & Hartzheim, LLP
Culver City, California
July 18, 2018
3 OFFICES: BEVERLY HILLS ∙ CULVER CITY ∙ SANTA MARIA
MEMBER AMERICAN INSTITUTE OF C.P.A.’S ∙ CALIFORNIA SOCIETY OF MUNICIPAL FINANCE OFFICERS ∙ CALIFORNIA ASSOCIATION OF SCHOOL BUSINESS OFFICIALS

PARTNERS COMMERCIAL ACCOUNTING & TAX SERVICES GOVERNMENTAL AUDIT SERVICES RONALD A LEVY, CPA 433 N. CAMDEN DR., SUITE 730 5800 HANNUM AVE, SUITE E CRAIG A HARTZHEIM, CPA BEVERLY HILLS, CA 90210 CULVER CITY, CA 90230 HADLEY Y HUI, CPA TEL: 310.273.2745 TEL: 310.670.2745
ALEXANDER C HOM, CPA FAX: 310.670.1689 FAX: 310.670.1689 ADAM V GUISE, CPA www.mlhcpas.com www.mlhcpas.com
INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR

EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER

COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE
To the Honorable Mayor and Members of the City Council
of the City of Taft
Taft, California
Report on Compliance for Each Major Federal Program
We have audited the City of Taft’s (City) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on the City’s major federal program for the fiscal year ended June 30, 2017. The City’s major federal program is identified in the summary of auditor’s results section of the accompanying schedule of findings and questioned costs.

Management’s Responsibility
Management is responsible for compliance with the requirements of federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs.

Auditor’s Responsibility
Our responsibility is to express an opinion on compliance for the City’s major federal program based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the City’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances.

We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the City’s compliance.

Opinion on Each Major Federal Program
In our opinion, the City of Taft complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on its major federal program for the fiscal year ended June 30, 2017.
4 Report on Internal Control over Compliance
Management of the City is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit, we considered the City’s internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance.

Accordingly, we do not express an opinion on the effectiveness of the City’s internal control over compliance.

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

Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City, as of and for the fiscal year ended June 30, 2017, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements. We issued our report thereon dated July 18, 2018, which contained unmodified opinions on those financial statements. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the basic financial statements. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by the Uniform Guidance and is 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 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 schedule of expenditures of federal awards is fairly stated in all material respects in relation to the basic financial statements as a whole.

The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.

Moss, Levy & Hartzheim, LLP
Culver City, California
July 18, 2018
City of Taft
Single Audit Report
Schedule of Expenditures of Federal Awards
For the Fiscal Year Ended June 30, 2017
Agency or
Federal Grantor/ Pass - Through Grantor Federal Pass-Through CFDA Program Federal
Program Title Number Number Expenditures
U.S. Department of Transportation:

Passed through the State of California Department
of Transportation:

Capital Assistance Program for Reducing Energy
Consumption and Greenhouse Gas Emissions 20.523 CML-5193(037) 201,488 $ Formula Grants for Rural Areas Section 5311 20.509 64BO15-00284 29,248 Federal Highway Administration (FHWA) - Highway
Planning and Construction
Passed through the State of California Department
of Transportation:

Highway Planning and Construction
6th St. Main to Supply Row 20.205 STPL - 5193 (039) 32, 368 Church St. from Pilgrim St. to Alley So of Rainer Ave 20.205 STPL - 5193 (038) 1,865 HSIP Kern St. 2nd to 10th 20.205 STPL - 5193 (040) 4,16 3 Former Sunset Corridor - from 2nd St. to SR 119 20.205 RPSTPLE - 5193 (036) 96,004 134,400
Total U.S. Department of Transportation 365,136
U.S. Department of Housing and Urban Development:

Passed through programs from the State of California
Department of Community Development Block Grant (CDBG) 14.228 N/A 418,064 Total U.S. Department of Housing and Urban Development 418,064 U.S. Department of Agriculture:

Water and Waste Disposal Systems for Rural Communities 10.854 N/A * 1,895,222 Total U.S. Department of Agriculture 1,895,222
TOTAL EXPENDITURES OF FEDERAL AWARDS $ 2,678,422
* - Denotes major program
N/A - Not applicable
5 See accompanying notes to schedule of expenditure of awards.

CITY OF TAFT
Notes to Schedule of Expenditures of Federal Awards
For the Fiscal Year Ended June 30, 2017
6 NOTE 1 – REPORTING ENTITY
The financial reporting entity consists of (a) the primary government, City of Taft (City), and (b) component unit which includes an organization for which the primary government is financially accountable, and other organizations for which the primary government is not accountable, but for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete. The component unit of the City is:
 Wastewater Treatment Plant of the City of Taft/Ford City-Taft Heights Sanitation District NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNT POLICIES
Basis of Accounting
Funds received under various grant programs have been recorded within the general fund, special revenue funds, capital project funds and enterprise funds of the City. The City utilizes the modified accrual method of accounting, whereby grant revenues are recognized when they become measurable and available, and expenditures are recognized when the related fund liability is incurred.

Indirect Cost Rates
The City has elected to utilize the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. During the fiscal year 2016-2017, the City did not charge any indirect costs to federal programs.

Schedule of Expenditures of Federal Awards
The accompanying schedule presents the activity of all federal financial assistance programs of the City.

Federal financial assistance received directly from federal agencies as well as federal financial assistance passed through the State of California are also included in the schedule.

The schedule was prepared from only the accounts of various grant programs and, therefore, does not present the financial position or results of the City’s operations.

NOTE 3 – PROGRAM DESCRIPTIONS
U.S. Department of Housing and Urban Development

Community Development Block Grant (CDBG)
The Community Development Block Grant (CDBG) Program was authorized under Title I of the Housing and Community Development Act of 1974. The primary objective of the CDBG Program is the development of viable urban communities, including adequate housing, a suitable living environment, and expansion of economic opportunities principally for persons of low to moderate income. Under this program, the Department of Housing and Urban Development (HUD) distributes funds based upon approved applications to eligible local governmental units for the purpose of community improvement and betterment. The City uses CDBG funds to finance a comprehensive home improvement program that assists low and moderate income residents through low interest subsidies and deferred loans.

CITY OF TAFT
Notes to Schedule of Expenditures of Federal Awards
For the Fiscal Year Ended June 30, 2017
7 NOTE 3 – PROGRAM DESCRIPTIONS (Continued)
U.S. Department of Transportation
Capital Assistance Program for Reducing Energy Consumption and Greenhouse Gas Emissions
To assist public agencies that provide transit service in financing the acquisition of capital assets to reduce energy consumption or greenhouse gas emissions. Eligible projects include the purchase of transit capital assets that will reduce energy consumption or greenhouse gas emissions.

Formula Grants for Rural Areas - 5311
The objective of this grant is to improve, initiate, or continue public transportation service in nonurbanized areas (rural areas and small cities under 50,000 in population) and to provide technical assistance for rural transportation providers. The Section 5311 program supports both the maintenance of existing public transportation services and the expansion of those services through the following program goals: enhancing access in rural areas to health care, shopping, education, employment, public services, and recreation; assisting in the maintenance, development, improvement, and use of public transportation systems in rural areas; encouraging and facilitating the most efficient use of all transportation funds used to provide passenger transportation in rural areas through the coordination of programs and services; providing financial assistance to help carry out national goals related to mobility for all, including seniors, individuals with disabilities, and low-income individuals; increasing availability of transportation options through investments in intercity bus services; assisting in the development and support of intercity bus transportation; encouraging mobility management, employment-related transportation alternatives, joint development practices, and transit-oriented development; and providing for the participation of private transportation providers in rural public transportation.

Highway Planning and Construction
This grant is awarded to assist State transportation agencies in the planning and development of an integrated, interconnected transportation system important to interstate commerce and travel by constructing and rehabilitating the National Highway System (NHS); and for transportation improvements to most other public roads; to provide aid for the repair of Federal-aid highways following disasters; to foster safe highway design; to replace or rehabilitate deficient or obsolete bridges; and to provide for other special purposes. Federal-aid highway funds are generally apportioned by statutory formulas to the States. They are generally restricted to roads open to the public and not functionally classified as rural minor collectors or local roads. Exceptions to this highway functional classification restriction include: planning and research activities, bridges, bicycle and pedestrian paths, and safety improvements that may be on any public road, nonmotorized transportation, the FLTP, and public transportation improvement. For highway projects, funds may be used for environmental studies, engineering and design services, right-of-way acquisition and relocation assistance, and construction for capital improvement projects classified as new construction, reconstruction, restoration, rehabilitation, and resurfacing, or for functional, geometric, or safety reasons. Funds may also be used for planning; research, development, and technology transfer; intelligent transportation systems projects; roadside beautification; wetland and natural habitat mitigation; traffic management and control improvements; improvements necessary to accommodate other transportation modes; development and establishment of transportation management systems; billboard removal; construction of bicycle facilities and pedestrian walkways; fringe and corridor parking; car pool and van pool projects; transportation alternatives and enhancements such as scenic and historic highway improvements; and recreational trails. Funds generally cannot be used for routine highway operational activities.

CITY OF TAFT
Notes to Schedule of Expenditures of Federal Awards
For the Fiscal Year Ended June 30, 2017
8 NOTE 3 – PROGRAM DESCRIPTIONS (Continued)
U.S. Department of Agriculture
Water and Waste Disposal Systems for Rural Communities
This grant is designed to assist rural communities in obtaining safe drinking water and adequate waste facilities, which are prerequisites for economic growth. In recent years, water and waste systems have been subject to increasingly stringent regulation under the Safe Drinking Water Act and the Clean Water Act. This program is instrumental in providing the financing to build or upgrade rural water and waste facilities. Under this program, the U.S. Department of Agriculture awards direct loans, loan guarantees, and project grants for new and improved water and waste systems serving rural areas where financing is not available from commercial sources at reasonable rates and terms. The Water and Waste Program is authorized to provide loan and grant assistance to eligible applicants for water and waste disposal facilities in rural areas and towns of up to 10,000 people.

The Obligations are being issued for the purpose of (a) paying the costs of the acquisition and construction of certain additions, betterments, extensions and improvements (the "Project") to the Wastewater Treatment System, consisting of a new headworks structure to be constructed next to the existing headworks and will consist of new flow channels, flume and screening and solids transport equipment, a new screening system for the dump station, a new Biolac aeration system, including new diffuser chains and blowers, the refurbishment and returning to service of Ponds 2 and 3 (including outfitting with Solar Bees solar-powered circulators or equivalent technology for effluent polishing), improvements to restore the operational status of transfer structures and related yard piping and an extensive electrical upgrade, including a new electrical service, new switchgear, and new conduit conductors as is required for code compliance and replacement of the existing standby generator with a new 375 KW generator (the "Projects").

NOTE 4 – AMOUNTS PROVIDED TO SUBRECIPIENTS
For the fiscal year ended June 30, 2017, the City did not have payments passed through to other agencies.

CITY OF TAFT

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
9 Section I – Summary of Auditor’s Results
Financial Statements
Type of auditor’s report issued Unmodified
Internal control over financial reporting:

Material weakness(es) identified? Yes X No
Significant deficiency(ies) identified not considered
to be material weaknesses? X Yes None reported
Noncompliance material to financial statements noted? Yes X No Federal Awards
Internal control over major programs:

Material weakness(es) identified? Yes X No
Significant deficiency(ies) identified not considered
to be material weaknesses? Yes X None reported
Type of auditor’s report issued on compliance for
major programs: Unmodified
Any audit findings disclosed that are required to be
reported in accordance with Uniform Guidance,
2 CFR 200.516 (a) Yes X No
Identification of major programs:

CFDA Number Name of Federal Program or Cluster

10.854 Water and Waste Disposal Systems for Rural
Communities
Dollar threshold used to distinguish between Type A
and Type B programs: $ 750,000

Auditee qualified as low-risk auditee: Yes X No

CITY OF TAFT

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
10 Section II – Findings– Financial Statement Audit
Significant Deficiency
2017-001 One general ledger investment account balance not updated timely.

Criteria:

The City should record the investment account activity to the general ledger timely to ensure that assets are properly accounted for and safeguarded.

Condition:

During our audit, we noted that one investment account for the transit fund was not in agreement to the general ledger.

Effect:

Recording investment activity in a timely manner helps safeguard assets by detecting errors on the part of the bank or the City.

Recommendation:

We recommend that the City record the investment activity on the general ledger within 30 days of the investment statement date.

Management’s response:

The City will ensure that the investment accounts are recorded in a timely manner.

Other Matter
2017-002 Single Audit not filed on time.

Although policies and procedures have been in place to ensure that the Single Audit is filed timely, the City did not file the Single Audit by March 31, 2018 as required by federal law. We would recommend that the City emphasize the timely filing of the Single Audit.

Section III – Findings and Questioned Costs – Major Federal Award Program Audit None reported in the current fiscal year.

CITY OF TAFT
STATUS OF PRIOR YEAR’S FINDINGS
FOR THE FISCAL YEAR ENDED JUNE 30, 2017
11 Section IV – Status of Prior Year Findings and Questioned Costs None reported in prior fiscal year.

CITY OF TAFT

MANAGEMENT REPORT
AND

AUDITOR'S COMMUNICATION LETTER
June 30, 2017
i

CITY OF TAFT
JUNE 30, 2017

TABLE OF CONTENTS
Management Letter………………………………….. ................................................................................. 1 Required Communication in Accordance with Statement on Auditing Standards No. 114 Communication with Those Charged with Governance ................................................................................. 2 Current Year Findings
Significant Deficiency
2017-001 One general ledger investment account balance not updated timely ............................................ 5 Other Matters
2017-002 Single Audit not filed on time ........................................................................................................ 5 Status of Prior Year Recommendations ..................................................................................................... 6 1 OFFICES: BEVERLY HILLS ∙ CULVER CITY ∙ SANTA MARIA
MEMBER AMERICAN INSTITUTE OF C.P.A.’S ∙ CALIFORNIA SOCIETY OF MUNICIPAL FINANCE OFFICERS ∙ CALIFORNIA ASSOCIATION OF SCHOOL BUSINESS OFFICIALS

PARTNERS COMMERCIAL ACCOUNTING & TAX SERVICES GOVERNMENTAL AUDIT SERVICES RONALD A LEVY, CPA 433 NORTH CAMDEN DRIVE, SUITE 730 5800 HANNUM AVE, SUITE E CRAIG A HARTZHEIM, CPA BEVERLY HILLS, CA 90210 CULVER CITY, CA 90230 HADLEY Y HUI, CPA TEL: 310.273.2745 TEL: 310.670.2745
ALEXANDER C HOM, CPA FAX: 310.670.1689 FAX: 310.670.1689 ADAM V GUISE, CPA www.mlhcpas.com www.mlhcpas.com

TRAVIS J HOLE, CPA
To the Honorable Mayor and Members
of the City Council of the City of Taft
Taft, California
In planning and performing our audit of the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Taft (City), California, as of and for the fiscal year ended June 30, 2017, in accordance with auditing standards generally accepted in the United States of America, we considered the City’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.

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

Our consideration of internal control was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that have not been identified.

Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. We did identify a deficiency in internal control, described in the accompanying schedule of findings, as 2017-001 that we consider to be a significant deficiency.

During our audit, we noted one matter involving internal control presented for your consideration, which is designed to assist the City to make improvements and operational efficiencies (Finding 2017-002).

This communication is intended solely for the information and use of management of the City of Taft, the members of the City Council, and others within the City, and is not intended to be and should not be used by anyone other than these specified parties.

Moss, Levy & Hartzheim, LLP
Culver City, California
July 18, 2018
2 OFFICES: BEVERLY HILLS ∙ CULVER CITY ∙ SANTA MARIA
MEMBER AMERICAN INSTITUTE OF C.P.A.’S ∙ CALIFORNIA SOCIETY OF MUNICIPAL FINANCE OFFICERS ∙ CALIFORNIA ASSOCIATION OF SCHOOL BUSINESS OFFICIALS

PARTNERS COMMERCIAL ACCOUNTING & TAX SERVICES GOVERNMENTAL AUDIT SERVICES RONALD A LEVY, CPA 433 NORTH CAMDEN, SUITE 730 5800 HANNUM AVE, SUITE E CRAIG A HARTZHEIM, CPA BEVERLY HILLS, CA 90210 CULVER CITY, CA 90230 HADLEY Y HUI, CPA TEL: 310.273.2745 TEL: 310.670.2745
ALEXANDER C HOM, CPA FAX: 310.670.1689 FAX: 310.670.1689 ADAM V GUISE, CPA www.mlhcpas.com www.mlhcpas.com

TRAVIS J HOLE, CPA

To the Honorable Mayor and Members of City Council
of the City of Taft
Taft, California
We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Taft (City), California for the fiscal year ended June 30, 2017. Professional standards require that we provide you with the information about our responsibilities under generally accepted auditing standards in the United States of America and, if applicable, Government Auditing Standards and Uniform Guidance, as well as certain information related to the planned scope and timing of our audit. We have communicated such information in our letter to you dated August 28, 2017. Professional standards also require that we communicate to you the following information related to our audit.

Significant Audit Matters
Qualitative Aspects of Accounting Practices
Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in Note 1 of the notes to the basic financial statements. No new accounting policies were adopted and the application of existing polices was not changed during the fiscal year.

We noted no transactions entered into by the City during the fiscal year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period.

Accounting estimates are an integral part of the financial statements prepared by management and are based on management's knowledge and experience about past and current events and assumptions about future events.

Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the financial statements were:

Management’s estimates included the funding progress and net pension liability of CalPERS, the estimated historical cost and useful lives of capital assets, and the allowance for doubtful accounts receivable. These estimates are based on CalPERS’ actuarial estimates, historical data and industry guidelines for capital assets, and historical data for allowance for doubtful accounts receivable. We evaluated the key factors and assumptions used to develop the estimates above in determining that they are reasonable in relation to the financial statements taken as a whole.

The financial statement disclosures are neutral, consistent, and clear. 3 Difficulties Encountered in Performing the Audit
We encountered no significant difficulties in dealing with management in performing and completing our audit.

Corrected and Uncorrected Misstatements
Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management. The attached schedule summarizes uncorrected misstatements of the financial statements. Management has determined that their effects are immaterial, both individually and in the aggregate, to the financial statements taken as a whole.

The following misstatement detected as a result of audit procedures were corrected by management:

Transit Fund
Deferred Revenue Security Grant 55,055
Deferred Revenue 92,015
Investment UBS (PTMISEA) (147,070)
To record activity in the proper account.

Disagreements with Management
For purposes of this letter, professional standards define a disagreement with management as a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor's report. We are pleased to report that no such disagreements arose during the course of our audit.

Management Representations
We have requested certain representations from management that are included in the management representation letter dated July 18, 2018.

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

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

Other Matters
We applied certain limited procedures to the budgetary comparison information, the schedules of the plan’s proportionate share of net pension liability, and the schedule of pension contributions, which are required supplementary information (RSI) that supplements the basic financial statements. Our procedures consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI.

We were engaged to report on WWTP Capital Projects budgetary comparison schedule, combining and individual non-major governmental and fiduciary fund financial statements, which accompany the financial statements but are not RSI. With respect to this supplementary information, we made certain inquiries of management and 4 evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves.

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

Moss, Levy & Hartzheim, LLP
Culver City, California
July 18, 2018
5 CURRENT YEAR FINDING AND RECOMMENDATION
Significant Deficiency
2017-001 One general ledger investment account balance not updated timely.

During our audit, we noted that one investment account for the transit fund was not in agreement to the general ledger.

Effect:

Recording investment activity in a timely manner helps safeguard assets by detecting errors on the part of the bank or the City.

Recommendation:

We recommend that the City record the investment activity on the general ledger within 30 days of the investment statement date.

Management’s response:

The City will ensure that the investment accounts are recorded in a timely manner.

Other Matters
2017-002 Single Audit not filed on time.

During our audit we noted that although policies and procedures have been in place to ensure that the Single Audit is filed timely, the City did not file the Single Audit by March 31, 2018 as required by federal law. We would recommend that the City emphasize the timely filing of the Single Audit.

6 STATUS OF PRIOR YEAR RECOMMENDATIONS
Other Matters
2016-001 Lack of official policy on fraud:

During our audit it was noted that the City does not have an official fraud policy in place.

Effect:

Without an official fraud policy, effective and efficient fraud prevention cannot take place.

Recommendation:

We recommend the City create an official fraud policy and have it approved by the City Council.

Current Status:

Not Implemented
2016-002 Lack of formal accounting manual in place:

Condition:

During our audit, it was noted that the City does not a formal accounting manual.

Effect:

Without a formal accounting manual, there are no set guidelines for employees to follow, which increases the risk of material misstatements.

Recommendation:

We recommend the City create a formal accounting manual.

Current Status:

Not Implemented
REVIEWED BY:

CITY CLERK FINANCE DIRECTOR CITY MANAGER
City of Taft Agenda Report
DATE: NOVEMBER 19, 2024
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:

ANNUAL AUDITED FINANCIAL STATEMENTS FOR FY2019-2020
SUMMARY STATEMENT:

Attached is the Annual Audited Report for the years ended June 30, 2020, which include the Annual Comprehensive Financial Report (ACFR). The Management Report (City wide), Wastewater Treatment Plant Financial Statements (WWTP) are not available at this time and will be presented to the city council when available. Since the City did not expend more than $750,000 in Federal monies the City was not required to prepare a Single Audit.

On November 18, 2024, the Taft City Finance Committee reviewed the Annual Audited Comprehensive Financial Report. The committee recommended the financial statements be presented to the City Council.

RECOMMENDED ACTION
Motion to receive and file the Annual Audited Comprehensive Financial Reports for the year ended June 30, 2020 and find that the activity is not a project per the California Environmental Quality Act (CEQA) as set forth in Section 15060(c)(3) and Section 15378 of the CEQA Guidelines.

IMPACT ON BUDGET (Y/N): No
ATTACHMENT (Y/N): YES, Annual Comprehensive Financial Report dated June 30, 2020.

PREPARED BY: Teresa Binkley, Finance Director

CITY OF TAFT

ANNUAL FINANCIAL REPORT

FOR THE FISCAL YEAR ENDED
JUNE 30, 2020
i

CITY OF TAFT

ANNUAL FINANCIAL REPORT
JUNE 30, 2020

TABLE OF CONTENTS

FINANCIAL SECTION

Independent Auditor’s Report ................................................................................................................... 1 Basic Financial Statements
Government-wide Financial Statements
Statement of Net Position ................................................................................................................ 5 Statement of Activities ..................................................................................................................... 6 Governmental Funds Financial Statements
Balance Sheet ................................................................................................................................... 8 Reconciliation of the Balance Sheet of Governmental
Funds to the Statement of Net Position ................................................................................... 11 Statement of Revenues, Expenditures, and Changes
in Fund Balances ..................................................................................................................... 12 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds
to the Statement of Activities ................................................................................................. 15 Proprietary Funds Financial Statements
Statement of Net Position .............................................................................................................. 16 Statement of Revenues, Expenses, and Changes in Fund Net Position ......................................... 18 Statement of Cash Flows ............................................................................................................... 20

Fiduciary Funds Financial Statements
Statement of Net Position .............................................................................................................. 22 Statement of Changes in Net Position ........................................................................................... 23 Notes to Basic Financial Statements ................................................................................................. 25 Required Supplementary Information
Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – General Fund ......................................................................................... 61 Schedule of Plan’s Proportionate Share of Net Pension Liability and Related Ratios as of Measurement Date – Combined Plan .................................................................................. 62 Schedule of Pension Contributions – Combined Plan ................................................................... 63 Other Supplemental Information
Major Fund Budgetary Comparison Schedule
Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – WWTP Capital Projects Fund ............................................................... 65

ii

CITY OF TAFT

ANNUAL FINANCIAL REPORT
JUNE 30, 2020
TABLE OF CONTENTS (Continued)
Non-Major Governmental Funds
Combining Balance Sheet .............................................................................................................. 70 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances ........................................................................................................................ 72 Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual –
Traffic Safety Special Revenue Fund ............................................................................... 74 Gas Tax Special Revenue Fund ........................................................................................ 75 Inmate Welfare Trust Special Revenue Fund ................................................................... 76 WWTP Special Revenue Fund ......................................................................................... 76 TDA Special Revenue Fund ............................................................................................. 77 Asset Forfeiture Special Revenue Fund ............................................................................ 78 Landscape Assessment District Special Revenue Fund .................................................... 79 Crime Prevention Special Revenue Fund ......................................................................... 80 Traffic Congestion Relief Special Revenue Fund ............................................................. 81 Private-Purpose Trust Funds and Agency Funds
Combining Statement of Net Position - Private-Purpose Trust Funds .......................................... 85 Combining Statement of Changes in Net Position -
Private- Purpose Trust Funds .................................................................................................. 86 Statement of Assets and Liabilities - Agency Fund ....................................................................... 87 Statement of Changes in Assets and Liabilities -
Agency Fund ........................................................................................................................... 88 1 OFFICES: BEVERLY HILLS ∙ CULVER CITY ∙ SANTA MARIA MEMBER AMERICAN INSTITUTE OF C.P.A.’S ∙ CALIFORNIA SOCIETY OF MUNICIPAL FINANCE OFFICERS ∙ CALIFORNIA ASSOCIATION OF SCHOOL BUSINESS OFFICIALS

PARTNERS COMMERCIAL ACCOUNTING & TAX SERVICES GOVERNMENTAL AUDIT SERVICES CRAIG A HARTZHEIM, CPA 8383 WILSHIRE BLVD., SUITE 800 5800 HANNUM AVENUE, SUITE E HADLEY Y HUI, CPA BEVERLY HILLS, CA 90211 CULVER CITY, CA 90230 ALEXANDER C HOM, CPA TEL: 310.670.2745 TEL: 310.670.2745 ADAM V GUISE, CPA FAX: 310.670.1689 FAX: 310.670.1689
TRAVIS J HOLE, CPA www.mlhcpas.com www.mlhcpas.com

WILSON LAM, CPA
INDEPENDENT AUDITOR’S REPORT
To the City Council
City of Taft, California
Report on the Financial Statements
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 City of Taft, California (City) as of and for the fiscal year ended June 30, 2020, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes 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.

Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion.

An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
2 Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Taft, California, as of June 30, 2020, and the respective changes in financial position, and, where applicable, cash flows thereof, for the fiscal year then ended in accordance with accounting principles generally accepted in the United States of America.

Other Matters
Required Supplementary Information
Management has omitted the Management’s Discussion and Analysis that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. Our opinion on the basic financial statements is not affected by this missing information.

Accounting principles generally accepted in the United States of America require that the budgetary comparison information on pages 61 and 62, the schedule of plan’s proportionate share of net pension liability on page 63 and the schedule of pension contributions on page 65, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Taft, California’s basic financial statements. The WWTP Capital Projects budgetary comparison schedule, combining and individual non-major governmental and fiduciary funds financial statements and schedules are presented for purposes of additional analysis and are not required parts of the basic financial statements.

The WWTP Capital Projects budgetary comparison schedule, combining and individual non-major governmental and fiduciary funds financial statements and schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements.

Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the WWTP Capital projects budgetary comparison schedule, combining and individual non-major governmental and fiduciary funds financial statements and schedules are fairly stated in all material respects in relation to the basic financial statements as a whole. 3 Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated October 29, 2024, on our consideration of the City of Taft, California’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is 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 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 of Taft, California’s internal control over financial reporting and compliance.

Moss, Levy & Hartzheim, LLP
Culver City, California
October 29, 2024
4 This page intentionally left blank
ASSETS
Cash and investments $ 5,215,588 $ 9,722,892 $ 14,938,480 Restricted cash and investments - 30 30
Cash and investments with fiscal agents 2,633,520 2,633,520 - Accounts receivable 910,841 2,235,511 3,146,352
Interest receivable 12,286 3,817 16,103
Internal balances (1,967,491) 1,967,491 -
Notes receivable 3,628,154 3,628,154 -
Prepaid expenses 97,221 9,690 106,911
Deposits - 17,450 17,450
Capital assets, not being depreciated 2,689,008 11,850 2,700,858 Capital assets, being depreciated 25,886,319 12,663,057 38,549,376 Capital assets, accumulated depreciation (8,161,939) (13,457,967) (21,619,906) Total assets 25,647,479 18,469,849 44,117,328

DEFERRED OUTFLOWS OF RESOURCES
Pension related 1,638,376 1,262,140 2,900,516
Total deferred outflows of resources 1,638,376 1,262,140 2,900,516

LIABILITIES
Accounts payable 178,851 164,322 343,173
Accrued payroll 153,227 278,818 432,045
Accrued interest payable 5,822 - 5,822
Unearned revenue 145,537 34,288 179,825
Deposits payable 9,807 52,010 61,817
Noncurrent liabilities:

Due within one year 62,369 204,384 266,753
Due in more than one year 187,112 3,806,150 3,993,262
Net pension liability 3,925,848 6,799,897 10,725,745
Total liabilities 11,303,675 4,704,767 16,008,442

DEFERRED INFLOWS OF RESOURCES
Pension related 377,261 372,099 749,360
Total deferred inflows of resources 377,261 372,099 749,360

NET POSITION
Net investment in capital assets 11,312,360 4,512,968 15,825,328 Restricted for:

Streets and roads 579,073 - 579,073
Public safety 259,858 - 259,858
Community development 4,206,930 4,206,930 -
Capital projects - WWTP 4,295,059 4,295,059 -
Unrestricted (5,048,361) 10,142,155 5,093,794
Total net position $ 14,655,123 15,604,919 $ 30,260,042 $

See accompanying notes to financial statements

CITY OF TAFT

STATEMENT OF NET POSITION
JUNE 30, 2020
Governmental
Activities
Business-type
Activities Total
5 CITY OF TAFT

STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
Expenses
Governmental activities:

General government $ 3,690,635 (3,170,047) $ 1,014,348 $ -$ Public safety 38,546 (4,304,658) 231,473 -
Public works (1,397,080) 164,805 815,483 330,102
Health and welfare (300,261) 51,616 3,432 -
Community development - (717,513) - -
Interest on long-term debt - (76,055) - -
Total governmental activities (9,965,614) 3,945,602 2,064,736 330,102 Business-type activities:

Community correctional facility (CCF) 12,129,650 (13,413,708) - - Federal WWTP (783,520) 741,996 - -
Sewer 1,217,841 (1,146,043) - -
Refuse (1,043,682) 1,007,422 5,000 -
Transit (760,719) 373,825 - -
Total business-type activities (17,147,672) 15,470,734 5,000 - Total government $ 19,416,336 (27,113,286) $ 2,069,736 $ 330,102$ General revenues and transfers:

Taxes:

Property taxes
Sales tax
Other taxes
Investment earnings
Miscellaneous
Total general revenues
Change in net position
Net position, beginning of fiscal year
Prior period adjustments
Net position, beginning of fiscal year, restated
Net position, end of fiscal year
See accompanying notes to financial statements
Program Revenues
Charges for
Services
Operating Grants
and Contributions
Capital
Grants and
Contributions
6 Net (Expense) Revenue and Change in Net Position
$ - 1,534,936 $ 1,534,936 $
- (4,034,639) (4,034,639)
- (86,690) (86,690)
(245,213) - (245,213)
(717,513) - (717,513)
(76,055) - (76,055)
(3,625,174) (3,625,174) -
(1,284,058) - (1,284,058)
- (41,524) (41,524)
- 71,798 71,798
- (31,260) (31,260)
(386,894) - (386,894)

(1,671,938) - (1,671,938)
(3,625,174) (1,671,938) (5,297,112)
1,574,559 1,574,559 -
1,669,337 1,669,337 -
370,613 - 370,613
264,745 59,111 323,856
474,069 - 474,069
4,353,323 59,111 4,412,434
728,149 (1,612,827) (884,678)
14,876,770 16,290,344 31,167,114
- (22,394) (22,394)
14,876,770 16,267,950 31,144,720
$ 15,604,919 $ 14,655,123 $ 30,260,042
Business-type
Activities Total
Governmental
Activities
7 Revolving Revolving
Loan CDBG Loan Home
Special Special
Revenue Revenue
ASSETS General Fund Fund
Cash and investments $ 10,176 560 $ 47,265 $
Restricted cash and investments 2,633,520 - -
Receivables:

Accounts 385,536 - -
Interest 9,834 17 55
Notes 1,805,090 - 1,551,454
Prepaid items 96,619 - -
Total assets $ 3,126,069 $ 1,815,283 $ 1,598,774

LIABILITIES, DEFERRED INFLOW OF RESOURCES, AND FUND BALANCES

LIABILITIES
Accounts payable $ 113,798 $ 10,176 $ -
Accrued payroll 140,286 - -
Due to other funds 1,815,710 - -
Deposit payable 9,807 - -
Unearned revenue 145,537 - -
Total liabilities 2,225,138 10,176 -

DEFERRED INFLOW OF RESOURCES
Unavailable revenue - 1,805,090 1,551,454
Total deferred inflow of resources - 1,805,090 1,551,454

FUND BALANCES
Nonspendable 96,619 - -
Restricted - 17 47,320
Unassigned - 804,312 -
Total fund balances (deficits) 900,931 17 47,320
Total liabilities, deferred inflow of
resources, and fund balances 3,126,069 $ 1,815,283 $ 1,598,774 $ See accompanying notes to financial statements

CITY OF TAFT

GOVERNMENTAL FUNDS

BALANCE SHEET
JUNE 30, 2020
8 WWTP Total
Capital Non-major
Projects Governmental
Fund Funds Total
$ 4,293,810 $ 5,203,417 851,606 $
- - 2,633,520
- 525,305 910,841
1,249 1,131 12,286
- 271,610 3,628,154
- - 96,619
$ 4,295,059 $ 1,649,652 $ 12,484,837
$ - $ 53,470 $ 177,444
- 7,855 148,141
- 151,781 1,967,491
- - 9,807
- - 145,537
- 213,106 2,448,420
- 769,918 4,126,462
- 769,918 4,126,462
- - 96,619
4,295,059 872,062 5,214,458
- (205,434) 598,878
4,295,059 666,628 5,909,955
$ 4,295,059 $ 1,649,652 $ 12,484,837
9 10
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CITY OF TAFT

GOVERNMENTAL FUNDS

RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS

TO THE STATEMENT OF NET POSITION
JUNE 30, 2020
Fund balances of governmental funds $ 5,909,955
Amounts reported for governmental activities in the statement of net position are different because:

Capital assets, net of accumulated depreciation, used in governmental activities are not current financial resources. Therefore, they are not reported in the governmental funds.

Total capital assets $ 28,575,327
Accumulated depreciation (13,457,967) 15,117,360
Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the governmental funds. Long-term liabilities include certificates of participation , lease refinancing bonds, compensated absences, and net pension liability. (10,810,431) Deferred outflows and inflows of resources relating to pensions: In governmental funds, deferred outflows and inflows of resources relating to pensions are not reported because they are applicable to future periods. In the statement of net position, deferred outflows and inflows of resources relating to pensions are reported.

Deferred inflows of resources relating to pensions $ (377,261) Deferred outflows of resources relating to pensions 1,638,376 1,261,115 Interest on long-term liabilities is not due and payable in the current period and, therefore, not reported in the governmental funds. (5,822) Internal service funds are used by management to charge the costs of certain activities such as vehicle maintenance to individual funds.

The assets and the liabilities of the internal service fund must be added to the statement of net position (not including compensated absences $6,280) 6,280
Certain revenues are unavailable in the gouvernmental funds because the availability criteria is not met. These revenues are recognized in the statement of net position. 4,126,462
Net position of governmental activities $ 15,604,919
See accompanying notes to financial statements
11 Revolving Revolving
Loan CDBG Loan Home
Special Special
Revenue Revenue
General Fund Fund

REVENUES
Property taxes $ 1,574,559 $ - $ -
Sales taxes 1,425,489 - -
Other taxes 614,460 - -
Licenses and permits, and fees 294,997 - -
Fines and forfeitures 2,393 - -
Use of money and property 201 351,050 717
Intergovernmental 6,770 402,106 2,741
Current services charges 3,544,320 - -
Other - 336,682 -
Total revenues 8,546,056 6,971 3,458

EXPENDITURES
Current:

General government - 1,670,987 -
Public safety - 3,615,128 -
Public works 1,088,900 - -
Health and welfare - - -
Community development 33 684,562 1,620
Capital outlay - 1,203,778 -
Debt service:

Principal retirement - 87,000 -
Interest and fiscal charges - 10,260 -
Total expenditures 8,360,615 33 1,620
Excess of revenues
over (under) expenditures 185,441 6,938 1,838

OTHER FINANCING SOURCES (USES)
Transfers in 653,805 1,179 -
Transfers out - (8,008) -
Total other financing sources (uses) 653,805 (6,829) -
Net change in fund balances 839,246 109 1,838
Fund balances, beginning of fiscal year (92) 61,685 45,482 Fund balances (deficits), end of fiscal year $ 900,931 $ 17 $ 47,320 See accompanying notes to financial statements

CITY OF TAFT

STATEMENT OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCES
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
12 WWTP Total
Capital Non-major
Projects Governmental
Fund Funds Total
$ - $ - $ 1,574,559
- - 1,425,489
- - 614,460
- - 294,997
- 2,988 5,381
28,996 21,169 402,133
- 1,511,782 1,923,399
- 113,374 3,657,694
- 3,432 340,114
28,996 1,652,745 10,238,226
- 786,667 2,457,654
- 165,155 3,780,283
- 24,034 1,112,934
- 51,406 51,406
- - 686,215
- 16,799 1,220,577
- 67,000 154,000
- 59,973 70,233
- 1,171,034 9,533,302
28,996 481,711 704,924
131,200 - 786,184
- (778,176) (786,184)
131,200 (778,176) -
160,196 (296,465) 704,924
4,134,863 963,093 5,205,031
$ 4,295,059 $ 666,628 $ 5,909,955
13 14
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Net change in fund balances of governmental funds $ 704,924 Amounts reported for governmental activities in the statement of activities differs from the amounts reported in the statement of revenues, expenditures, and changes in fund balance because:

Governmental funds report capital outlay as expenditures. However, in the statement of activities, the costs of those assets are allocated over their estimated useful lives as depreciation expense.

This activity is reconciled as follows:

Capital outlay $ 1,220,577
Less road maintenance and repairs classified as public works expense (282,734) Loss on disposal of assets (11,947)
Depreciation expense (1,001,485) (75,589)
Certain notes receivable are reported in the governmental funds as expenditures and then offset as unavailable revenue as they are not available to pay current expenditures. Likewise, when the note is collected, it is reflected in revenue.

This is the net change between notes receivable collected and issued. 455,537 In governmental funds, pension costs are recognized when employer contributions are made. In the statement of activities, pension costs are recognized on the accrual basis. This fiscal year, the difference between accrual-basis pension costs and actual employer contributions was:

Pension costs (492,627)
Debt repayments are reported as expenditures in the governmental funds. The repayment is not an expense in the statement of activities as it is a reduction of a long-term liability. The balance for compensated absences reflects the difference between absences accrued and absences paid.

Principal payment bond certificates of participation 154,000 Compensated absences (12,274)
Interest payables on long-term liabilities are not due and payable in the current period and, therefore, is not recorded in the current period. (5,822) Change in net position of governmental activities 728,149 $ See accompanying notes to financial statements
FOR THE FISCAL YEAR ENDED JUNE 30, 2020

CITY OF TAFT

GOVERNMENTAL FUNDS

RECONCILIATION OF STATEMENT OF REVENUES, EXPENDITURES,

AND CHANGES IN FUND BALANCES

TO THE STATEMENT OF ACTIVITIES
15 Major
Major Enterprise Major
Enterprise Federal Enterprise
CCF WWTP Sewer
Fund Fund Fund
ASSETS
Current assets:

Cash and investments $ 3,315,737 $ 1,602,066 $ 3,284,677 Restricted cash and investments - - -
Receivables:

Accounts 2,005,719 - 119,939
Interest 533 1,307 845
Due from other funds - 3,332,129 -
Prepaid items 9,690 - -
Deposits - - 17,450
Total current assets 5,331,679 4,935,502 3,422,911
Noncurrent assets:

Capital assets, not being depreciated 11,850 - -
Capital assets, being depreciated 339,039 5,903,542 2,915,878 Capital assets, accumulated depreciation (269,572) (4,256,258) (1,889,827) Total noncurrent assets 81,317 1,647,284 1,026,051
Total assets 5,412,996 6,582,786 4,448,962

DEFERRED OUTFLOWS OF RESOURCES
Pension related 1,087,613 18,866 18,122
Total deferred outflows of resources 1,087,613 18,866 18,122

LIABILITIES
Current Liabilities:

Accounts payable 122,842 13,267 17,388
Accrued payroll 254,502 3,187 2,529
Due to other funds - - -
Unearned revenue - - -
Deposits payable - - 23,973
Current portion of compensated absences 51,613 3,402 2,517 Total current liabilities 428,957 19,856 46,407
Noncurrent liabilities:

Compensated absences 154,840 10,208 7,552
Net pension liability 3,405,911 55,757 52,513
Total noncurrent liabilities 3,560,751 65,965 60,065
Total liabilities 3,989,708 85,821 106,472

DEFERRED INFLOWS OF RESOURCES
Pension related 320,703 2,547 2,817
Total deferred inflows of resources 320,703 2,547 2,817

NET POSITION
Net investment in capital assets 81,317 1,647,284 1,026,051 Unrestricted 2,108,881 4,866,000 3,331,744
Total net position $ 2,190,198 $ 6,513,284 $ 4,357,795
See accompanying notes to financial statements

CITY OF TAFT

STATEMENT OF NET POSITION

PROPRIETARY FUNDS
JUNE 30, 2020
Business-type Activities
16 Governmental
Activities
Major Major
Enterprise Enterprise Total Internal
Transit Refuse Enterprise Service
Fund Fund Funds Fund
$ 1,520,412 - $ $ 9,722,892 $ 12,171
30 - 30 -
15,119 94,734 2,235,511 -
- 1,132 3,817 -
- - 3,332,129 -
- - 9,690 602
- - 17,450 -
15,149 1,616,278 15,321,519 12,773
- - 11,850 -
2,909,555 595,043 12,663,057 -
(1,203,077) (543,205) (8,161,939) -
1,706,478 51,838 4,512,968 -
1,721,627 1,668,116 19,834,487 12,773
101,960 35,579 1,262,140 -
101,960 35,579 1,262,140 -
3,310 7,515 164,322 1,407
11,349 7,251 278,818 5,086
1,364,638 - 1,364,638 -
34,288 - 34,288 -
- 28,037 52,010 -
2,317 2,520 62,369 6,280
1,415,902 45,323 1,956,445 12,773
6,951 7,561 187,112 -
312,369 99,298 3,925,848 -
319,320 106,859 4,112,960 -
1,735,222 152,182 6,069,405 12,773
38,475 7,557 372,099 -
38,475 7,557 372,099 -
1,706,478 51,838 4,512,968 -
(1,656,588) 1,492,118 10,142,155 -
$ 49,890 $ 1,543,956 $ 14,655,123 $ -
Business-Type Activities
17 Major
Major Enterprise Major
Enterprise Federal Enterprise
CCF WWTP Sewer
Fund Fund Fund

OPERATING REVENUES
Charges for services $ 12,072,332 $ 741,996 $ 1,212,213 Connection and installation fees - - 1,495
Other - 57,318 4,133
Total operating revenues 12,129,650 741,996 1,217,841

OPERATING EXPENSES
Salaries and wages 6,742,028 95,455 74,974
Training and development 27,864 - -
Contract and professional services 1,640,935 187,703 36,342 Maintenance and operations 145,522 45,907 602,067
Materials and supplies 280,314 (10,575) 1,210
Insurance 662,707 41,763 35,757
Utilities 425,738 55,436 187
Administrative service charges - 59,647 203,202
Depreciation 36,751 233,013 65,822
Bad debt expense - - 2,201
Other operating expenses 3,451,849 75,171 124,281
Total operating expenses 13,413,708 783,520 1,146,043
Operating income (loss) (1,284,058) (41,524) 71,798

NONOPERATING REVENUES (EXPENSES)
Interest earnings on investments 21,082 5,089 14,169
Interest expense - - -
Intergovernmental - - -
Total nonoperating revenues (expenses) 5,089 21,082 14,169 Changes in net position (20,442) (1,278,969) 85,967
Total net position, beginning of fiscal year as
originally stated 6,533,726 3,469,167 4,271,828
Prior period adjustment - - -
Total net position, beginning of fiscal year as
restated 3,469,167 6,533,726 4,271,828
Total net position, end of fiscal year $ 2,190,198 $ 6,513,284 $ 4,357,795 See accompanying notes to financial statements
Business-type Activities

CITY OF TAFT

STATEMENT OF REVENUES, EXPENSES, AND

CHANGES IN FUND NET POSITION

PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
18 Governmental
Activities
Major Major
Enterprise Enterprise Total Internal
Transit Refuse Enterprise Service
Fund Fund Funds Fund
$ 1,007,422 373,825 $ $ 15,407,788 $ 199,915
- - 1,495 -
- - 61,451 -
373,825 1,007,422 15,470,734 199,915
356,972 138,062 7,407,491 157,786
3,140 - 31,004 -
1,393 431,354 2,297,727 -
99,901 179,579 1,072,976 6,452
11,198 20,761 302,908 9,771
30,747 35,817 806,791 -
4,628 - 485,989 5,935
- 58,270 321,119 10,963
151,288 23,625 510,499 -
- 39,791 41,992 -
101,405 116,423 3,869,129 9,008
760,672 1,043,682 17,147,625 199,915
(386,847) (36,260) (1,676,891) -
- 18,771 59,111 -
(47) - (47) -
- 5,000 5,000 -
(47) 23,771 64,064 -
(386,894) (12,489) (1,612,827) -
459,178 1,556,445 16,290,344 -
(22,394) - (22,394) -
436,784 1,556,445 16,267,950 -
$ 49,890 $ 1,543,956 $ 14,655,123 $ -
Business-type Activities
19 Major
Major Enterprise Major
Enterprise Federal Enterprise
CCF WWTP Sewer
Fund Fund Fund
Cash Flows from Operating Activities:

Cash received from customers and users $ 12,411,626 $ 824,440 $ 1,208,572 Cash paid to suppliers for goods and services (6,706,501) (460,900) (996,887) Cash paid to employees for services (6,278,270) (84,823) (67,436) Net cash provided (used) by operating activities (573,145) 278,717 144,249 Cash Flows from Capital and Related Financing Activities:

Acquisition, proceeds, and construction of capital assets (38,001) - - Net cash provided (used) by capital and related financing activities - (38,001) - Cash Flows from Non-Capital Financing Activities:

Cash received (paid) to/from other funds, including interest 1,319,082 (3,332,129) - Net Cash provided by Non-Capital Financing Activities: 1,319,082 (3,332,129) - Cash Flows from Investing Activities:

Interest received 11,321 28,246 18,998
Net Cash provided (used) by investing activities 11,321 28,246 18,998 Net increase (decrease) in cash and cash equivalents 757,258 (3,063,167) 163,247 Cash and Cash Equivalents at Beginning of Fiscal Year 2,558,479 4,665,233 3,121,430 Cash and Cash Equivalents at End of Fiscal Year $ 3,315,737 $ 1,602,066 $ 3,284,677 Reconciliation to Statement of Net Position:

Cash and investments $ 3,315,737 $ 1,602,066 $ 3,284,677 Restricted cash and investments - - -
Total cash and cash equivalents $ 3,315,737 $ 1,602,066 $ 3,284,677 Reconciliation of Operating Income (Loss) to Net Cash
Provided (Used) by Operating Activities:

Operating income (loss) $ (1,284,058) $ (41,524) $ 71,798 Adjustments to reconcile operating income (loss) to
net cash provided (used) by operating activities:

Depreciation 36,751 233,013 65,822
(Increase) decrease in accounts receivable 281,976 82,444 (9,269) (Increase) decrease in prepaid expenses 60,570 523 572
(Increase) decrease in deposits - - (18)
(Increase) decrease in deferred outflows of resources - pension 25,613 420 325 Increase (decrease) in deferred inflows of resources - pension 16,497 270 209 Increase (decrease) in net pension liability 392,866 6,438 4,977 Increase (decrease) in accounts payable (132,142) (6,371) 6,996 Increase (decrease) in accrued payroll 14,845 630 449
Increase (decrease) in unearned revenue - - -
Increase (decrease) in deposits payable - - 810
Increase (decrease) in compensated absences 13,937 2,874 1,578 Total adjustments 710,913 320,241 72,451
Net cash provided (used) by operating activities $ (573,145) $ 278,717 $ 144,249 See accompanying notes to financial statements

CITY OF TAFT
Business-type Activities

STATEMENT OF CASH FLOWS

PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
20 Governmental
Activities
Major Major
Enterprise Enterprise Total Internal
Transit Refuse Enterprise Service
Fund Fund Funds Fund
$ 1,067,281 548,507 $ 16,060,426 $ 199,915 $
(904,968) (260,706) (9,329,962) (40,747)
(130,083) (335,061) (6,895,673) (154,799)
(47,260) 32,230 (165,209) 4,369
- (38,001) - -
- (38,001) - -
47,290 (1,965,757) - -
47,290 (1,965,757) - -
20,299 - 78,864 -
20,299 - 78,864 -
52,529 30 (2,090,103) 4,369
1,467,883 - 11,813,025 7,802
$ 1,520,412 30 $ $ 9,722,922 $ 12,171
$ 1,520,412 - $ $ 9,722,892 $ 12,171
30 - 30 -
$ 1,520,412 30 $ $ 9,722,922 $ 12,171
$ (386,847) $ (36,260) $ (1,676,891) $ -
151,288 23,625 510,499 -
162,788 64,859 582,798 -
5,570 1,687 68,922 1,304
- - (18) -
1,270 357 27,985 -
818 230 18,024 -
19,484 5,475 429,240 -
573 (30,184) (161,128) 78
1,792 3,308 21,024 1,091
11,894 - 11,894 -
(14,437) 524 (13,103) -
(1,453) (1,391) 15,545 1,896
339,587 68,490 1,511,682 4,369
$ (47,260) $ 32,230 $ (165,209) $ 4,369
Business-type Activities
21 Private-Purpose Agency
Trust Funds Funds
ASSETS
Cash and investments $ 116,813 188,498 $
Interest receivable 154 -
Capital assets - nondepreciable 1,698,163 -
Capital assets - being depreciated 407,116 -
Capital assets - accumulated depreciation (266,839) -
Total assets 2,027,092 $ 116,813

LIABILITIES
Accounts payable 11,520 $ -
Accrued payroll 888 -
Accrued interest payable 7,237 -
Due to inmates - 116,813
Loan payable to City of Taft - 1,588,959
Bonds payable 1,587,000 -
Total liabilities 3,195,604 $ 116,813

NET POSITION
Unrestricted (1,161,275)
Total net position (deficit) $ (1,168,512)
See accompanying notes to financial statements

CITY OF TAFT

STATEMENT OF NET POSITION

FIDUCIARY FUNDS
JUNE 30, 2020
22 Private Purpose
Trust Funds
Additions:

Investment revenue $ 1,204
Taxes and assessments 316,548
Total additions 317,752
Deductions:

Community development 130,132
Interest expense 42,345
Depreciation 10,177
Total deductions 182,654
Change in net position 135,098
Net Position (Deficit) - beginning of fiscal year (1,303,610) Net Position (Deficit) - end of fiscal year $ (1,168,512) See accompanying notes to financial statements
FOR THE FISCAL YEAR ENDED JUNE 30, 2020

STATEMENT OF CHANGES IN NET POSITION

FIDUCIARY FUNDS

CITY OF TAFT
23 24
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25 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of Taft, California (the City), which was founded on November 7, 1910, has a population of 9,052 living within an area of 15.05 square miles. It is located in Western Kern County 119 miles northwest of Los Angeles, 280 miles south of San Francisco, and 37 miles southwest of Bakersfield in the foothills of the western edge of southern San Joaquin Valley.

The financial statements of 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 units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.

A. Reporting Entity
In evaluating how to define the City for financial reporting purposes, management has considered all potential component units. The decision to include a potential component unit in the reporting entity was made by applying the criteria set forth in the U.S. GAAP. The basic—but not the only—criterion for including a potential component unit within the reporting entity is the governing body’s ability to exercise oversight responsibility. The most significant manifestation of this ability is financial interdependency. Other manifestations of the ability to exercise oversight responsibility include, but are not limited to, the selection of the governing authority, the designation of management, the ability to significantly influence operations and accountability for fiscal matters. The other criteria used to evaluate potential component units for inclusion or exclusion from the reporting entity is the existence of special financing relationships, regardless of whether the City is able to exercise oversight responsibilities. Based upon the application of these criteria, the following is a brief review of each potential component unit addressed in defining the City’s reporting entity.

Included within the reporting entity:
 Taft Public Financing Authority. A nonprofit public benefit corporation created in 1994 through a Joint Exercise of Powers agreement between the City of Taft and the Taft Community Development Agency established for the purpose of, among other things, issuing bonds to provide financing and refinancing for public capital improvements of the City and Agency. (Separate financial statements are not prepared for this entity.)  Taft Public Improvement Corporation. A nonprofit public benefit corporation created in 1989 to provide services for the betterment of the City. These services include constructing various capital improvements for the City, assisting with the creation or expansion of the City’s facilities, the purchase and sale of real or personal property and assisting the City to finance, acquire, construct, and install such property. (Separate financial statements are not prepared for this entity.)
 Greater Taft Transportation Authority. The Greater Taft Transportation Authority (GTTA) was formed in April 2001 as a joint exercise of powers between the City of Taft and Taft Community Development Agency pursuant to the California Government Code Section 6500 et seq. (Separate financial statements are not prepared for the GTTA.)

26 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) B. Accounting and Reporting Policies
The City has conformed to the pronouncements of the GASB, which are the primary authoritative statements of accounting principles generally accepted in the United States of America applicable to state and local governments.

C. Fund Accounting
The accounts of the City are organized on the basis of funds, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, deferred inflow/outflow of resources, fund equity, revenues, and expenditures/expenses. Government resources are allocated to and accounted for in individual funds based upon the purpose for which they are to be spent and the means by which spending activities are controlled. The various funds are grouped, in the financial statements in this report, into generic fund types and broad categories as follows:

Governmental Funds:
 General Fund. The General Fund is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in other funds.  Special Revenue Funds. The Special Revenue Funds are used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specific purposes.  Capital Projects Fund. The Capital Project Fund is used to account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by Proprietary Funds).

Proprietary Funds:
 Enterprise Funds. The Enterprise Funds are used to account for operations that are financed and operated in a manner similar to a private business enterprise – where the intent of the City Council is that the costs (expenses including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges.
 Internal Service Fund – Garage Fund. The Garage Fund is used to account for the cost of providing vehicle maintenance to operating funds. Costs are recovered by user charges.

Fiduciary Funds:

 Agency Funds. The Agency Funds are used to account for assets held by the City as an agent.

These funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations.

27 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) C. Fund Accounting (Continued)
 Private Purpose Funds. These funds are for disbursements made only for those activities to wind down the business of the former Taft Community Development Agency (TCDA). These activities include but are not limited to the payment of debt service related to the bonds issued by the TCDA as well as other contractual commitments.

D. Basis of Accounting/Measurement Focus
Government-wide Financial Statements
The City’s Government-wide Financial Statements include a Statement of Net Position and a Statement of Activities (including changes in Net Position). These statements present summaries of governmental and business-type activities of the City. Fiduciary activities of the City are not included in these statements.

These statements are presented on an “economic resources” measurement focus and the accrual basis of accounting. Accordingly, all the City’s assets and liabilities, including capital assets and infrastructure as well as long-term debt, are included in the accompanying Statement of Net Position.

The Statement of Activities presents changes in net position. Under the accrual basis of accounting, revenues are recognized in the period in which the liability is incurred. The Statement of Activities demonstrates the degree to which the direct expenses of a given function are offset by program revenues. Direct expenses are those that are clearly categories: 1) charges for services, 2) operating grants and contributions, and 3) capital grants and contributions. Charges for services include revenues from customers or applicants who purchase, use, or directly benefit from the goods, services, or privileges provided by a given function. Grants and contributions include revenues restricted to meeting the operational or capital requirements of a particular function. Taxes and other items not properly included among program revenue are reported as general revenue.

Certain eliminations have been made as prescribed by GASB Statement No. 34 in regard to interfund activities, payables, and receivables. All internal balances in the Statement of Net Position have been eliminated.

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 funds and aggregated nonmajor funds. An accompanying schedule is presented to reconcile and explain the differences in fund balances as presented in these statements to the net position presented in the government-wide financial statements. The City has presented all major funds that met the qualifications of GASB Statement No.

34. The governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under the current financial resources’ measurement focus, only current assets, deferred outflows of resources, current liabilities and deferred inflows of resources are generally included on their balance sheets. The reported fund balance is considered to be a measure of “available spendable resources”. The governmental fund operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in fund balance. Accordingly, they are said to present a summary of sources and 28 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Basis of Accounting/Measurement Focus (Continued)
Governmental Fund Financial Statements (Continued)
uses of “available spendable resources” during a period. Noncurrent portions of long-term receivables due to governmental funds are reported on their balance sheets in spite of their spending measurement focus. Recognition of governmental fund type revenue represented by noncurrent receivables is deferred until they become current receivables or are offset by due to other governments. Revenues are recorded when received in cash, except that revenues subject to accrual (generally 60 days after year-end) are recognized when due. Those revenues susceptible to accrual are property taxes, sales taxes, interest revenues, charges for services, and special assessments. Licenses, fines, and permit revenues are not susceptible to accrual because they generally are not measurable until received in cash.

Grants revenues are recorded if payment is expected within 180 days of year end.

Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred, except for principal and interest on long-term obligations which are recognized when due. Because of their current financial resources focus, expenditure recognition for governmental fund types excludes amounts represented by non-current liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund expenditures or fund liabilities.

The City reports the following major governmental funds:

The General Fund is the government’s primary operating fund. It accounts for all financial resources of the City, except those required to be accounted for in another fund.

The Revolving Loan Fund – CDBG was established to account for Community Development grants by using Community Development program revenue.

The Revolving Loan Fund – HOME was established to account for funds as direct loans for rehabilitation or reconstruction of dwellings owned and occupied by qualifying low- and moderateincome households.

The WWTP Capital Projects Fund is used to account for capital asset acquisition and construction of the wastewater treatment plant.

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. All proprietary fund types are accounted for using the accrual basis of accounting and the economic resources measurement focus.

Their revenues are recognized when earned, and expenses are recognized when incurred. All liabilities associated with their activity are also included in the Statement of Net Position.

Proprietary Funds include enterprise funds. The City reports the following major enterprise funds:

The CCF Fund is used to account for the operations of the Community Correctional Facility. The CCF provides housing and program services to the California Department of Corrections.

29 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Basis of Accounting/Measurement Focus (Continued)
Proprietary Fund Financial Statements (Continued)
The Federal WWTP Fund is used to account for the operations related to building and maintaining a wastewater treatment plant for the federal prison.

The Sewer Fund is used to account for the operations of the City’s sewer system.

The Transit Fund is used to record the operations of the Taft Area Transit Dial-A-Ride service. The enterprise collects fares from users of the service.

The Refuse Fund is used to record the operation of the refuse removal enterprise of the City. The enterprise collects user fees for the collection of refuse from businesses and residents in the City of Taft.

Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the City’s proprietary funds are charges to customers for services. Operating expenses include the cost of services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses. The principal operating revenue of the internal service fund is charges to other funds. Operating expenses for the internal service fund include the costs of vehicle maintenance.

Internal Service Fund Statements
The City reports one Internal service fund for the Central Garage. This fund is established to account for any activity that provides goods or services to other funds or departments of the primary government and its component units, or to other governments, on a cost-reimbursement basis. See proprietary funds above for accounting for internal service funds.

Fiduciary Fund Financial Statements
Fiduciary Fund Financial Statements include a Statement of Net of Position and a Statement of Changes in Net Position. The fiduciary funds are used to report assets held in a trustee or agency capacity for others and therefore, are not available to support City programs. Since these assets are being held for the benefit of a third party, these funds are not incorporated into the government-wide statements.

The City’s fiduciary funds are agency funds and private purpose trust funds. These funds use the accrual basis of accounting, Agency funds are used to account for amounts held for debt service related to conduit debt, and amounts held on behalf of inmates housed in the Community Correctional Facility.

The Agency funds are custodial in nature (assets equal liabilities) and therefore do not involve measurement of results of operations. The private purpose funds are used to account for the redevelopment agency successor agency by the City as trustee. Trust funds are accounted for on the economic resources measurement focus.

30 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) E. Budgetary Policy and Control
General Budget Policies
The City Council approves each year’s budget submitted by the City Manager prior to the beginning of the new fiscal year. Public meetings are conducted prior to its adoption by the Council. All appropriations lapse at year-end. The City Council has the legal authority to amend the budget at any time during the fiscal year. The City Manager has the authority to adjust the operating budget within each fund. Transfers of operating budget appropriations between funds or to or from appropriated reserve accounts, use of unappropriated fund balances, cancellation of appropriations and all changes in capital improvement project budgets require the approval of the City Council.

The City maintains budgetary controls to ensure compliance with legal provisions embodied in the appropriated budget approved by the City Council. The level of budgetary control (that is, the level at which expenditures cannot legally exceed the appropriated amount) for the operating budget is at fund level. Formal budgetary integration is employed as a management control device during the fiscal year for the Governmental Fund Types.

F. Cash/Investment Policy
In order to maintain an effective investment program, all cash, except certain trust and agency cash and restricted cash, is pooled, and amounts not required for day-to-day financial transactions are invested as approved by the City Council on a pooled basis and earnings are allocated to each fund on the basis of its average cash balance at the end of each quarter.

GASB Statement No. 31, “Accounting and Financial Reporting for Certain Investments and External Pools”, requires governmental entities to report certain investments at fair value in the balance sheet and recognize the corresponding change in the fair value of investments in the year in which the change occurred. In accordance with GASB Statement No. 31, the City has adjusted certain investments to fair value (when material).

G. Capital Assets and Depreciation
Capital assets, which include buildings, machinery and equipment, and infrastructure assets (roads, bridges, etc.) are reported in the government-wide financial statements as well as proprietary fund financial statements. Capital assets are defined by as long-lived assets (in excess of one year) tangible assets with an initial, individual cost of more than $5,000 and any purchases and/or construction of infrastructure that exceeds $50,000 and/or extends the useful life of the asset. Such assets are recorded at historical cost or estimated historical cost if actual historical cost is not available.

Capital assets are depreciated over their estimated useful lives using the straight-line method. This means the cost of the asset is divided by its expected useful life in years and the result is charged to expense each year until the asset is fully depreciated. The purpose of depreciation is to spread the cost of capital assets over the useful life of these assets. The amount charged to depreciation expense each year represents that year’s pro rata share of the cost of capital assets.

31 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) G. Capital Assets and Depreciation (Continued)
Depreciation of capital assets is charged as an expense against operations each year and the total amount of depreciation taken over the years, called accumulated depreciation, is reported on the Statement of Net Position of the government-wide financial statements as a reduction in the book value of capital assets.

The City has assigned the useful lives listed below to capital assets:

Structures and improvements 20-40 Years
Machinery and equipment 5-20 Years
Infrastructure
Pavement 40 Years
Concrete 60 Years
H. Deferred Outflow/Inflow of Resources
In addition to assets, the statement of net position and balance sheet will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then.

The City has deferred outflows of resources on pensions in the statement of net position.

In addition to liabilities, the statement of net position and balance sheet will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and will not be recognized as an inflow of resources (revenue) until that time. The City has deferred inflows of resources-deferred revenue – loans/notes on the governmental funds’ financial statements and pensions in the statement of net position.

I. Interfund Transactions
Quasi-external transactions are accounted for as fund revenues or expenditures/expenses. Transactions, which constitute reimbursements to a fund for expenditures/expenses are recorded as expenditures/expenses in the reimbursing fund, and as reductions of the expenditures/expenses in the reimbursed fund.

J. Capitalized Interest
No interest cost relating to construction was capitalized during the fiscal year ending June 30, 2020.

K. Compensated Absences
The compensated absences accrual on June 30, 2020, amounted to $205,534 for Governmental Activities and $249,481 for Business-type Activities.

32 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) K. Compensated Absences (Continued)
 Sick leave liability
Generally, employees earn one day of sick leave per month with a maximum accumulation of 720 hours. All employees are entitled to payment for accumulated sick leave up to the lower of 50 percent of earned days or forty-five days, upon retirement, death, or disability.  Vacation leave liability
Employees earn ten days’ vacation leave per year, for less than four years of service; from four years through nine years of service, fifteen days are earned; from ten years through nineteen years of service, twenty days are earned; and after nineteen years, twenty-five days. All employees are able to accrue an amount equal to twice the employee’s annual accrual, after which further accrual will cease. Accumulated vacation is payable upon termination.

L. Property Taxes
Property Taxes attach as an enforceable lien on property as of January 1. Taxes are levied on July 1 and are payable in two installments which are delinquent after December 10 and April 10. Unsecured personal property taxes become due on July 1st of each year and are delinquent, if unpaid by August 31st. Kern County bills and collects the property taxes and remits them to the City in installments during the year. City property tax revenues are recognized on the modified accrual basis of accounting method.

The County is permitted by State Law (Proposition 13) to levy taxes at 1 percent of full value (at time of purchase). The City receives a share of this basic levy proportionate to what it received in the 1976 to 1978 period.

M. Cash Flows
Proprietary fund type cash and investments are used in the preparation of the statement of cash flows as investments are pooled and are not allocated to specific funds. Each of these funds’ share of pooled cash and investments is considered cash for purposes of the statement of cash flows since these amounts are immediately available for withdrawal. For the purposes of the Proprietary Funds’ Statement of Cash Flows, the City considers all investments with a maturity of three months or less when purchased to be cash equivalents.

N. Use of Restricted Resources
When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, and then unrestricted resources as they are needed. Restricted resources are defined as resources received from outside agencies dedicated for specific purposes (grants for example).

O. Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, deferred outflows or resources, liabilities, and deferred inflows of resources and disclosures of contingent assets and liabilities, at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reported period. Accordingly, actual results could differ from those estimates.
33 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) P. Pensions
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the City’s California Public Employees’ Retirement System (CalPERS) plans (Plans) and additions to/deductions from the Plans’ fiduciary net position have been determined on the same basis as they are reported by CalPERS.

For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported as fair value.

Q. New Accounting Pronouncements
Future Accounting Standards:

GASB has issued the following statements which may impact the City’s financial reporting requirements in the future:

The provisions of Statement Number 84 "Fiduciary Activities" are effective for fiscal years beginning after December 15, 2019.

The provisions of Statement Number 87 "Leases" are effective for fiscal years beginning after June 15, 2021.

The provisions for Statement Number 89 "Accounting for Interest Cost Incurred before the End of a Construction Period" are effective for fiscal years beginning after December 15, 2020.

The provisions for Statement Number 90 "Majority Equity Interests - an amendment of GASB Statements No. 14 and No. 61" are effective for fiscal years beginning after December 15, 2019.

The provisions for Statement Number 91 “Conduit Debt Obligations” are effective for fiscal years beginning after December 15, 2021.

The provisions for Statement Number 92 “Omnibus 2020” in paragraphs number 73 and 74 are effective for fiscal years beginning after June 15, 2021.

The provisions for Statement Number 93 “Replacement of Interbank Offered Rates” are effective for reporting periods beginning after June 15, 2021, except for paragraphs 11b, 13 and 14. The provisions of paragraph 11b are effective for reporting periods ending after December 31, 2021. The requirements in paragraphs 13 and 14 are effective for fiscal years beginning after June 15, 2021.

The provisions for Statement Number 94 “Public-Private and Public-Public Partnerships and Availability Payment arrangements” are effective for fiscal years beginning after June 15, 2022.

The provisions for Statement Number 96 “Subscription-Based Information Technology Arrangements” are effective for fiscal years beginning after June 15, 2022, and all reporting periods thereafter.

The provisions for Statement Number 97 “Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans – an amendment of GASB Statements No. 14 and No. 84, and a supersession of GASB Statement No. 32” are effective for fiscal years beginning after June 15, 2021.
34 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Q. New Accounting Pronouncements (Continued)
The provisions of Statement Number 98 “The Annual Comprehensive Financial Report” are effective for fiscal years ending after December 15, 2021.

The provisions for Statement Number 99 “Omnibus 2022” are effective as follows: the requirements related to the extension of LIBOR, accounting for SNAP distributions, disclosures of nonmonetary transactions, pledges of future revenues by pledging governments, clarification of certain provisions in Statement 34, as amended, and terminology updates related to Statement 53 and Statement 63 are effective for the fiscal year ending June 30, 2022; the requirements related to leases, PPPs, and SBITAs, are effective for fiscal years beginning after June 15, 2022; and the requirements related to financial guarantees and the classification and reporting of derivative instruments within the scope of Statement 53 are effective for fiscal years beginning after June 15, 2023.

The provisions for Statement Number 100 “Accounting Changes and Error Corrections-an amendment of GASB Statement No. 62” are effective for fiscal years beginning after June 15, 2023.

The provisions of Statement Number 101 “Compensated Absences” are effective for fiscal years beginning after December 15, 2023.

The provisions of Statement Number 102 “Certain Risk Disclosures” are effective for fiscal years beginning after June 15, 2024.

The provisions for Statement Number 103 “Financial Reporting Model Improvements” are effective fpr fiscal years beginning after June 15, 2025.

R. Prior Period Adjustment
The City of Taft restated beginning net position of the Business-type activities and the Transit Enterprise Fund by $22,394 as of July 1, 2019. The City had received and recorded as revenue in the fiscal year ending June 30, 2019 a grant of $22,394 which had not yet been earned.

NOTE 2 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
A. General Budget Policies

1. The budget adopted by the City Council provides for the general operation of the City. It includes proposed expenditures and the means of financing them.

2. The City Council approves total budgeted appropriations and any amendments to appropriations throughout the fiscal year. All amendments made during the fiscal year are included in the budgetary amounts reported herein. The “appropriated budget” covers all City expenditures. Actual expenditures may not exceed budgeted appropriations at the fund level, which is the legal level of budgetary control.

3. The budget adopted by the City Council provides for the general operation of the City. It includes proposed expenditures and the means of financing them.

35 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 2 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (Continued) A. General Budget Policies (Continued)

4. The City Council approves total budgeted appropriations and any amendments to appropriations throughout the fiscal year. All amendments made during the fiscal year are included in the budgetary amounts reported herein. The “appropriated budget” covers all City expenditures. Actual expenditures may not exceed budgeted appropriations at the fund level, which is the legal level of budgetary control.

5. Formal budgetary integration is employed as a management control device during the fiscal year.

Commitments for materials and services, such as purchase orders and contracts, are recorded as encumbrances to assist in controlling expenditures. Appropriations which are encumbered lapse at fiscal year-end, and then are added to the following fiscal year’s budgeted appropriations.

6. Budgets for the General, Special Revenue, Capital Projects, and Debt Service Funds are adopted on a basis substantially consistent with accounting principles generally accepted in the United States of America (U.S. GAAP). Accordingly, actual revenues and expenditures can be compared with related budgeted amounts without any significant reconciling items.

Budget comparisons are not presented for the Proprietary funds, as the City is not legally required to adopt a budget for this type of funds.

There were no budgets adopted for the following funds: RLF-CDBG (major fund), Revolving Loan Fund – Home (major fund), Cal Homes Revolving Loan, and TARP Revolving Loan.

7. Capital projects are budgeted through the Capital Projects Funds. Appropriations for capital projects authorized but not constructed or completed during the fiscal year are carried forward as continuing appropriations into the following fiscal year’s budget.

8. Under Article XIII-B of the California constitution (the GANN Spending Limitation Initiative), the City is restricted as to the amount of annual appropriations from the proceeds of taxes, and if proceeds of taxes exceed allowed appropriations, the excess must either be refunded to the State Controller or returned to the taxpayers through revised tax rates or revised fee schedules, or an excess in one year may be offset by a deficit in the following year. For the fiscal year ended June 30, 2020, based on calculations by City staff, proceeds of taxes did not exceed appropriations.

Further, section 5 of Article XIII-B allows the City to designate a portion of fund balance for general contingencies, to be used for any purpose.

B. Deficit Fund Balances/Net Position
The following funds contained deficit fund balances/net position as of June 30, 2020:

The City anticipates that future revenue will be sufficient to cover these deficits.

Nonmajor Governmental Fund:

WWTP $ 122,075
Landscape Assessment District 83,359
36 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 2 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (CONTINUED) C. Excess of Expenditures over Appropriations
Excess of expenditures over appropriations in departments/cost centers of individual funds:

NOTE 3 – CASH AND INVESTMENTS
The City maintains a cash and investment pool that is available for use by all funds. Cash and investments on June 30, 2020, consisted of the following:

Final
Expenditures Appropriations Excess
Major Governmental Funds
General Fund
General government $ 1,670,987 $ 1,556,900 $ (114,087)
Community development 684,562 684,559 (3)
Principal 87,000 - (87,000)
Interest 10,260 - (10,260)
Nonmajor Governmental Funds
WWTP Special Revenue Fund
General government 786,667 781,872 (4,795)
Capital outlay 16,799 - (16,799)
Statement of Net Position:

Cash and investments 14,938,480 $
Restricted cash and investments 30
Cash and investments with fiscal agents 2,633,520
Statement of Fiduciary Net Position:

Cash and investments 305,311
Total cash and investments $ 17,877,341
Cash on hand $ 5,581
Deposits held by financial institutions 3,894,058
Investments 13,977,702
Total cash and investments $ 17,877,341
37 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
Investments authorized by the California Government Code and the City’s Investment policy The table below identifies the investment types that are authorized for the City by the California Government Code (or the City’s investment policy, where more restrictive). The table also identifies certain provisions of the California Government Code (or the City’s investment policy, where more restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustee that are governed by the provisions of debt agreements of the City, rather than the general provisions of the California Government Code or the City’s investment policy.

Investment Authorized by Debt Agreements
Investments of debt proceeds held by bond trustee are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City’s investment policy. The table below identifies the investment types that are authorized for investments held by bond trustee. The table also identifies certain provisions of these debt agreements that address interest rate risk.

Authorized Investment Type
Maximum
Maturity
Maximum
Percentage/
Amount of
Portfolio
Maximum
Investment in
One Issuer
U.S. Treasury Obligations 5 Years None None
Certificates of Deposit 5 Years None None
Negotiable Certificates of Deposit 3 Years 30% None
Passbook Savings Accounts N/A None None
County Pooled Investment Funds N/A 50% None
Local Agency Investment Fund (LAIF) N/A $75,000,000 $75,000,000 U.S. Agency Securities N/A None None
Authorized Investment Type
Maximum
Investment in
One Issuer
Maximum
Percentage/
Amount of
Portfolio
Maximum
Maturity
U.S. Agency Securities None None None
Money Market Mutual Funds None None N/A
Commercial Paper None None 270 days
Certificates of Deposit None None 5 years
Repurchase Agreements None None 180 days
U.S. Treasury Obligations None None 365 days
Time Deposits None None 365 days
38 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. Information about the sensitivity of the fair values of the City’s investments (including investments held by bond trustee) to market interest rate fluctuations are provided by the table below that shows the distribution of the City’s investments by maturity:

Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the minimum rating required by (where applicable) the California Government Code, the City’s investment policy, or debt agreements, and the actual rating as of fiscal yearend for each investment type:

Concentration of Credit Risk
The City is in compliance with restrictions imposed by the investment policy, which limits certain types of investments. As of June 30, 2020, the City has not invested more than 5% of its total investments in any one issuer. Investments guaranteed by the United States Government and investments in mutual funds and external investment pools are excluded from this requirement.

Remaining Maturity (in Months)
12 Months 13 to 24 25 to 60
Investment Type or Less Months Months Total
State Investment Pool (LAIF) 4,429,972 $ - $ -$ 4,429,972 $ Mutual Funds 3,236,974 - - 3,236,974
Certificates of Deposit 947,712 1,329,537 1,533,507 3,810,756 Money Market Mutual Funds 2,500,000 - - 2,500,000
Total $ 11,114,658 1,329,537$ 1,533,507$ 13,977,702$
S&P Rating
Minimum Exempt From
Investment Type Amount Legal Rating Disclosure AAA AA+ A Not Rated State Investment Pool (LAIF) 4,429,972 $ N/A - $ -$ -$ $ 4,429,972 - $ Mutual Funds 3,236,974 N/A - - - - 3,236,974
Certificates of Deposit 3,810,756 N/A - - - - 3,810,756 Money Market Mutual Funds 2,500,000 N/A - - 2,500,000 - - Total $ 13,977,702 - - 2,500,000 - 11,477,702
39 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of a failure of the counterparty (e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party.

The California Government Code and the City’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provisions for deposits: The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The fair value of the pledged securities in the collateral pool must equal at least 110% of the total fair value deposited by the public agencies. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits.

GASB Statement No. 40 requires that the following disclosure be made with respect to custodial credit risks relating to deposits and investments: All of the City deposits with financial institutions (including Certificates of Deposit) in excess of federal depository insurance limits were held in pledged collateral accounts as described above.

As of June 30, 2020, all of the City’s deposits with financial institutions in excess of federal depository insurance limits were held in collateralized accounts. As of June 30, 2020, the City’s investment in the following type was held by the same broker-dealer (Counterparty) that was used by the City to buy the security:

Investment Type Reported Amount
Certificates of Deposit $3,810,756
Investment in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California.

The fair value of the City’s investment in this pool is reported in the accompanying financial statements at amounts based upon the City’s pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis.

LAIF is a governmental investment pool managed and directed by the California State Treasurer and is not registered with the Securities and Exchange Commission. An oversight committee, comprised of California State officials and various participants, provided oversight to the management of the fund. The daily operations and responsibilities of LAIF fall under the auspices of the State Treasurer’s office. The City is a voluntary participant in the investment pool.

40 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
Fair Value Measurements:

The City pool investment categorizes its fair value measurements within the fair value hierarchy established by accounting principles generally accepted in the United States of America. These principles recognize a three-tiered fair value hierarchy, as follows:

Level 1: Investments reflect prices quoted in active markets; Level 2: Investments reflect prices that are based on a similar observable asset either directly or indirectly, which may include inputs in markets that are not considered to be active; and, Level 3: Investments reflect prices based upon unobservable sources.

The City pool investment has the following recurring fair value measurements as of June 30, 2020:

The City also had investments in money market mutual funds, however, these investments are not required to be measured under Level 1, 2 or 3.

NOTE 4 – NOTES RECEIVABLE
The City operates a loan program whereby funds are made available to eligible businesses and individuals for various purposes. Grant funds were originally used to start the program and repayments are required to be used for the same purpose. As of June 30, 2020, the balance of notes receivable was $3,628,154 of this amount, $3,628,154 are deferred housing notes, which are due when the properties are transferred. These notes are collateralized by the titles of the properties. The remaining balances are made up of CDBG notes made to local businesses. These notes carry interest rates between 1% to 5%. All the notes are deferred revenue offsets.

NOTE 5 – LOAN RECEIVABLE FROM SUCCESSOR AGENCY TRUST FUND The City loaned $1,588,959 to the former redevelopment agency to purchase land for redevelopment purposes. The redevelopment agency was dissolved pursuant to state law (see Note #16 for further details on the dissolution and Successor Agency Trust Fund). The loan bears no interest and is only eligible to be repaid after all third-party obligations of the Successor Agency Trust Fund are paid. The City has estimated that the Successor Agency Trust Fund will not have sufficient resources to repay this loan in the foreseeable future and has recorded an allowance for the full amount of the loan receivable. On June 30, 2020, the loan receivable balance was $1,588,959 with an allowance of $1,588,959 for a net loan receivable of $0.

Fair Value Measurements Using
Investment by Fair Value Level Fair Value
Quoted Prices in
Active Markets
for Identical
Assets (Level 1)
Significant Other
Observable Input
(Level 2)
Significant
Unobservable
Inputs (Level 3)
Debt securities
Certificates of deposits 3,810,756 $ 3,810,756 $ - $ $ - Mutual Funds 3,236,974 3,236,974 - -
US Government Agency Securities 2,500,000 2,500,000 - - Total Investments Measured at Fair Value 9,547,730 9,547,730 - - Investments Measured at Amortized Cost
LAIF 4,429,972
Total Pooled Investments $ 13,977,702
41 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 6 – INTERFUND ACTIVITIES
In general, the City uses interfund transfers to (1) move revenues from the funds that collect them to the funds that statute or budget requires to expend them, (2) use unrestricted revenues collected in the General Fund to help finance various programs and capital projects accounted for in other funds in accordance with budgetary authorization, and (3) move cash to debt service funds from the funds responsible for payment as debt service payments become due.

In general, the effect of the interfund activity has been eliminated from the government-wide financial statements.

Interfund transfers during the fiscal year ended June 30, 2020, are as follows:

Current interfund balances arise in the normal course of business (i.e., one fund loaning funds to pay for current expenditures) and are expected to be repaid shortly after the end of the fiscal year. The following is a summary of interfund balances as of June 30, 2020.

Transfers In Transfers Out
Major Governmental Funds:

General 653,805 $ - $
Revolving Loan Fund CDBG 1,179 8,008
WWTP Capital Projects 131,200 -
Nonmajor Governmental Fund:

WWTP - 131,200
Gas Tax - 625,682
Traffic Congestion Relief - 21,294
Total interfund transfers 786,184 $ 786,184 $
Due from Due to
(Receivable) (Payable)
Major Governmental Funds:

General $ 1,815,710 - $
Major Proprietary Fund:

WWTP 3,332,129 -
Transit 1,364,638 -
Nonmajor Governmental Funds:

WWTP - 68,666
Landscape Assessment District 83,115 -
Total $ 3,332,129 $ 3,332,129
42 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 7 – CAPITAL ASSETS AND DEPRECIATION
In accordance with GASB Statement No. 34, the City has reported all capital assets including infrastructure in the government-wide statement of net position. The City elected to use the basic approach as defined by GASB Statement No. 34 for all infrastructures reporting, whereby depreciation expense and accumulated depreciation have been recorded. The following table presents the capital asset activity for the fiscal year ended June 30, 2020.

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

Balance Balance
Governmental Activities July 1, 2019 Additions Deletions June 30, 2020 Capital assets not being depreciated:

Land $ 1,357,256 $ 1,950 $ 1,359,206 - $
Construction in progress 724,430 605,370 1,329,800 -
Total capital assets not being depreciated 2,081,686 607,320 - 2,689,006 Capital assets being depreciated:

Structures and improvements 14,495,687 38,057 14,533,744 - Machinery and equipment 4,357,920 292,466 (634,979) 4,015,407 Infrastructure:

Roadway system 7,071,987 - 7,071,987 -
Bridges 265,183 - 265,183 -
Total capital assets being depreciated 26,190,777 330,523 (634,979) 25,886,321 Less accumulated depreciation for:

Structures and improvements (6,404,780) (453,173) (6,857,953) - Machinery and equipment (3,598,669) (257,635) 623,032 (3,233,272) Infrastructure:

Roadway system (2,810,882) (290,677) (3,101,559) -
Bridges (265,183) - (265,183) -
Total accumulated depreciation (13,079,514) (1,001,485) 623,032 (13,457,967) Total capital assets, being depreciated
net of accumulated depreciation 13,111,263 (670,962) (11,947) 12,428,354 Total Governmental activities capital assets,
net of accumulated depreciation $ 15,192,949 $ (63,642) $ (11,947) $ 15,117,360 General government $ 327,890
Public safety 181,182
Public works 243,204
Health and welfare 247,574
Community development 1,635
Total depreciation expense - governmental activities $ 1,001,485 43 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 7 – CAPITAL ASSETS AND DEPRECIATION (CONTINUED)
Changes in business-type activities capital assets:

The City donated to the CCF fund from the governmental activities a police cruiser acquired for $30,420 and that was fully depreciated by the City prior to July 1, 2019. The City recorded the fixed asset and the accumulated depreciation for $30,420.

Depreciation for business-type activities was charged to functions/programs as follows:

Balance Capital Balance
Business-type activities July 1, 2019 Additions Deletions Contribution June 30, 2020 Capital assets not being depreciated:

Land $ 11,850 $ - $ - -$ 11,850$
Construction in progress - - - - -
Total capital assets not being depreciated 11,850 - - - 11,850 Capital assets being depreciated:

Structures and improvements 7,446,142 - - - 7,446,142
Machinery and equipment 2,433,027 38,001 (193,267) 30,420 2,308,181 Sewer infrastructure 2,908,734 - - - 2,908,734
Total capital assets being depreciated 12,787,903 38,001 (193,267) 30,420 12,663,057 Less accumulated depreciation for:

Structures and improvements (4,299,658) (262,962) - - (4,562,620) Machinery and equipment (1,715,306) (183,146) 193,267 (30,420) (1,735,605) Sewer infrastructure (1,799,323) (64,391) - - (1,863,714) Total accumulated depreciation (7,814,287) (510,499) 193,267 (30,420) (8,161,939) Total capital assets, being depreciated,
net of accumulated depreciation 4,973,616 (472,498) - - 4,501,118 Total Business-type activities capital assets,
net of accumulated depreciation $ 4,985,466 $ (472,498) $ - -$ 4,512,968 $ CCF $ 36,751
Federal WWTP 233,013
Sewer 65,822
Refuse 23,625
Transit 151,288
Total depreciation expense - business-type activities $ 510,499 44 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 8 – GOVERNMENTAL ACTIVITIES LONG-TERM LIABILITIES
During the fiscal year ended June 30, 2020, the following changes occurred to the governmental activities long-term liabilities:

Certificates of Participation
Certificates of Participation (COP) are long-term instruments which are tax exempt and therefore, issued at interest rates below current market levels for taxable investments.

On June 15, 2015, the WWTP entered into a loan financing program with the United States Department of Agriculture, acting through its agency the USDA Rural Development, to finance a portion of the cost and expense of the acquisition and construction of certain improvements to the wastewater treatment system of the City of Taft via the execution and delivery of certificates of participation.

The City entered into a financing program with the Taft Public Improvement Corporation, a California nonprofit public benefit corporation duly organized and existing under and by virtue of the laws of the State of California (the "Corporation"), for the purchase by the Corporation of the real property on which the wastewater system is situated (the "Site"), together with the existing wastewater treatment system improvements (the "Existing Facilities") situated thereon, and the purchase by the City from the Corporation of the completed Project.

The City is in receipt of a Letter of Conditions, originally dated November 8, 2012 and extended through April 10, 2017 (the "Letter of Conditions"), from USDA Rural Development, setting forth certain conditions to be satisfied by the City with respect to receipt from USDA Rural Development of funding for the project, comprised of a loan in the amount of not-to-exceed $3,619,000 to be represented by the Certificates of Participation. The Installment payments shall be payable during a period of not more than 40 years and the interest rate shall not exceed 1.75% per annum. During the fiscal year 2016-17, the City spent $3,251,654 for the project which was completed in May 2017. The City received loan funds of $1,895,222 during the fiscal year 2016-17 with the remaining certificates of participation issued of $1,356,432 disbursed to the City during FY 2017-18. The certificates of participation had an outstanding principal balance of $3,360,000 as of June 30, 2020.

Balance Balance Due in
Governmental Activities: July 1, 2019 Additions Deletions June 30, 2020 One Year Certificates of participation 3,427,000 $ $ (67,000)$ - $ 3,360,000 $ 68,000 Compensated absences 191,364 14,170 - 205,534 51,384
2019 Revenue Refunding Bonds 532,000 (87,000) - 445,000 85,000 Total Long term liabilities 4,150,364$ $ 14,170 (154,000)$ $ 4,010,534 $ 204,384 45 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 8 – GOVERNMENTAL ACTIVITIES LONG-TERM DEBT (CONTINUED) Certificates of Participation maturity schedule:

Compensated Absences
The short-term portion of the liability is determined to be the amount due to employees for future absences, which is attributable to services already rendered, and which is expected to be paid during the next fiscal year. The general fund is expected to liquidate approximately 75 percent of the liability, the WWTP special revenue fund approximately 10 percent, and other funds, the remaining 15 percent. 1998 Revenue Refunding Bonds and 2019 Revenue Refunding Bonds The former Redevelopment Agency and the Taft Financing Authority entered into a loan agreement dated November 1, 1998 pursuant to which the former Redevelopment Agency borrowed proceeds of the 1998 Revenue Refunding bonds and agreed to make loan payments to the Taft Financing Authority. On December 1, 1998, the Taft Financing Authority issued $5,060,800 of 1998 Revenue Refunding Bonds for the purpose of refinancing the 1993 Revenue Bonds and certain loans from the City of Taft. The 1998 Revenue Bonds interest rates range from 4.25 to 5.80%. Interest is payable semiannually each January 1 and July 1 and principal is paid annually each January 1 through 2028. Tax increment revenue is pledged as collateral for the repayment of the bonds. In addition, the City of Taft agreed to lease the police station and the lease payments were pledged to the payment of the 1998 Revenue Bonds. After dissolution of the Redevelopment Agency, these bonds were paid from the Successor Agency Trust Fund with the City of Taft’s General Fund paying to the Successor Agency Trust Fund the lease payment each year.

The lease portion of the debt of the 1998 Revenue Refunding Bonds should have been recorded as longterm debt of the governmental activities and not as a liability of the Successor Agency Trust Fund. On July 1, 2018, the City of Taft recorded an opening balance adjustment for the remaining principal balance of the lease portion of the 1998 Revenue Refunding Bonds of $905,000.

PRINCIPAL INTEREST TOTAL
2021 $ 68,000 $ 58,800 $ 126,800
2022 69,000 57,610 126,610
2023 70,000 56,402 126,402
2024 71,000 55,178 126,178
2025 73,000 53,935 126,935
2026-2030 383,000 250,110 633,110
2031-2035 417,000 215,408 632,408
2036-2040 455,000 177,642 632,642
2041-2045 497,000 136,378 633,378
2046-2050 541,000 91,367 632,367
2051-2055 590,000 42,350 632,350
2056 126,000 2,205 128,205
Total $ 3,360,000 $ 1,197,385 $ 4,557,385
46 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 8 – GOVERNMENTAL ACTIVITIES LONG-TERM DEBT (CONTINUED) The City, the Taft Public Financing Authority, and the Successor Agency Trust Fund desired to refinance the 1998 Revenue bonds. On June 1, 2019, the Taft Public Financing Authority issued $2,310,000 Revenue Refunding Bonds to refinance the 1998 Revenue bonds to pay off the remaining outstanding debt of the 1998 Revenue bonds for both the City of Taft and the Successor Agency. The City of Taft paid the outstanding principal of $905,000 on the 1998 Revenue Refunding Bonds to reduce the outstanding principal to $0 as of June 30, 2019. The present value of the savings on the prior debt is $196,462. Principal and interest are due beginning August 1, 2019, and are due semiannually on August 1st and February 1st through February 2025. The City’s principal outstanding for the 2019 Revenue Refunding Bonds was $445,000 as of June 30, 2020.
2020 Revenue Refunding Bonds Lease Portion maturity schedule NOTE 9 – BUSINESS-TYPE ACTIVITIES LONG-TERM DEBT
During the fiscal year ended June 30, 2020, the following changes occurred to the business-type activities long-term liabilities:

Compensated Absences
The liability is recorded in the various funds and is determined to be the amount due to employees for future absences, which is attributable to services already rendered. The amount estimated to be paid during the next fiscal year is classified with current liabilities, with the remainder classified with noncurrent liabilities.

NOTE 10 – PENSION PLAN
A. General Information about the Pension Plan
Plan Descriptions - All qualified employees are eligible to participate in the City’s separate Safety (fire and police) and Miscellaneous (all other) plans, cost-sharing multiple employers defined benefit pension plans administered by the California Public Employees' Retirement System (CalPERS), which acts as a common investment and administrative agent for its participating member employers. Benefit provisions under the Plans are established by State statute and Local Government resolution. CalPERS 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.

PRINCIPAL INTEREST TOTAL
2021 85,000 $ 13,298 $ 98,298$
2022 83,000 10,644 93,644
2023 86,000 8,023 94,023
2024 88,000 5,307 93,307
2025 103,000 2,418 105,418
Total $ 445,000 39,690$ $ 484,690
Balance Balance Due in
Business type activities July 1, 2019 Additions Deletions June 30, 2020 One Year Compensated absences 233,936$ $ 15,545 $ 249,481 - $ $ 62,369 Total business-type activities 233,936 $ $ 15,545 $ 249,481 - $ $ 62,369 47 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 10 – PENSION PLAN (CONTINUED)
A. General Information about the Pension Plan (Continued) Benefits Provided - CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries.

Benefits are based on years of credited service, equal to one year of full-time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following:
the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The costof-living adjustments for each plan are applied as specified by the Public Employees' Retirement Law.

The Plans’ provisions and benefits in effect on June 30, 2020, are summarized as follows:

Contributions - Section 20814(c) of the California Public Employees' Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July l following notice of a change in the rate. Funding contributions for both Plans are determined annually on an actuarial basis as of June 30 by CalPERS. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the fiscal 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 fiscal year ended June 30, 2020, the contributions recognized as part of pension expense were as follows:

Contributions – employer (Safety Plan) $389,648
Contributions – employer (Miscellaneous Plan) $704,306

Tier I Tier II Pepra
Hire date Prior to October 3, 1996 On or after October 3, 1996 On or after January 1, 2013 Benefit formula 2.0%@50 2.0%@55 2.0%@57
Benefit vesting schedule 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life Retirement age 50 - 55 50 - 55 50 - 57
Monthly benefits, as a % of eligible compensation 2.0% to 2.7% 1.4% to 2.0% 1.426% to 2.0% Required employee contribution rates 9.000% 7.00% 9.500% Required employer contribution rates 15.719% 12.848% 10.020% City Safety Plan
Tier I PEPRA
Hire date Prior to January 1, 2013 On or after January 1, 2013 Benefit formula 2.0%@55 2.0%@62
Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50 - 63 52 - 67
Monthly benefits, as a % of eligible compensation 1.4% to 2.4% 1.0% to 2.5% Required employee contribution rates 7.00% 6.25%
Required employer contribution rates 8.892% 6.842%
City Miscellaneous Plan
48 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 10 – PENSION PLAN (CONTINUED)
B. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions As of June 30, 2020, the City reported net pension liability for its proportionate share of the net pension liability in the amount of $10,725,745.

The City’s net pension liability is measured as the proportionate share of the net pension liability. The net pension liability is measured as of June 30, 2019, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2018, rolled forward to June 30, 2019, using standard update procedures. The City's proportion of the net pension liability was based on a projection of the City’s long-term share of contributions to the pension plans relative to the projected contributions of all participating employers, actuarially determined. The City’s proportionate share of the net pension liability for the Plan as of June 30, 2018, and 2019 was as follows:

For the fiscal year ended June 30, 2020, the City recognized pension income of $297,791. On June 30, 2020, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Safety Miscellaneous Combined Total
Proportion - June 30, 2018 0.08288% 0.13014% 0.21302%
Proportion - June 30, 2019 0.08421% 0.13657% 0.22078%
Change - Increase 0.00133% 0.00643% 0.00776%
Deferred Outflows Deferred Inflows
of Resources of Resources
Difference between expected and actual
experience 723,062 $ (29,430) $
Changes of assumptions 476,251 (134,492)
Changes of employer's proportions 435,730 (35,180)
Net difference between projected and actual
earnings on pension plan investments (167,930)
Changes in proportion and differences
between City contributions and
proportionate share of contributions (382,328)
City contributions subsequent to the
measurement date 1,265,473
$ (749,360) 2,900,516 $
49 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 10 – PENSION PLAN (CONTINUED)
B. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
The City reported $1,265,473 as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the fiscal year ended June 30, 2021. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:

Actuarial Assumptions - The total pension liabilities in the June 30, 2018 actuarial valuations were determined using the following actuarial assumptions:

All other actuarial assumptions used in the June 30, 2018 valuation use the results of CalPERS Experience Study and Review of Actuarial Assumptions – December 2017, including updates to salary increase, mortality, and retirement rates, as a basis. The experience study report can be obtained at CalPERS’ website under Forms and Publications.

Fiscal Year Ended
June 30
2021 785,507 $
2022 (39,478)
2023 106,262
2024 33,392
Safety Miscellaneous
Valuation Date June 30, 2018 June 30, 2018
Measurement Date June 30, 2019 June 30, 2019
Actuarial Cost Method Entry-Age Normal Cost Method Entry-Age Normal Cost Method Actuarial Assumptions:

Discount Rate 7.15% 7.15%
Inflation 2.50% 2.50%
Salary increases** Varies by entry Age and Service Varies by entry Age and Service Investment Rate of Return 7.15% 7.15%
Mortality* Derived using CalPERS' Derived using CalPERS' Membership Data for all Membership Data for all
Funds Funds
* The mortality table used was developed based on CalPERS' specific data. The table includes 15 years of mortality improvements using Society of Actuaries Scale 90% of scale MP-2016. For more details on this table, please refer to the December 2017 experience study report (based on CalPERS demographicc data from 1997 to 2015) that can be found on the CalPERS' website. 50 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 10 – PENSION PLAN (CONTINUED)
B. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
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 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 Plans 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 pension plan investments was applied to all periods of projected benefits 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 expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.

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

The table on the next page reflects the long-term expected real rates of return by asset class. The rate of return was calculated using the capital market assumptions applied to determine the discount rate.

New
Strategic Real Return Real Return
Asset Class Allocation Years 1 - 10 (a) Years 11+ (b)
Global Equity 50.00% 4.80% 5.98%
Fixed Income 28.00% 1.00% 2.62%
Inflation Assets 0.00% 0.77% 1.81%
Private Equity 8.00% 6.30% 7.23%
Liquidity 13.00% 3.75% 4.93%
Liquidity 1.00% 0.00% -0.92%
Total 100.00%
(a) An expected inflation of 2.00% used for this period. (b) An expected inflation of 2.92% used for this period. 51 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 10 – PENSION PLAN (CONTINUED)
B. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
Sensitivity of the Net Pension Liability to Changes in the Discount Rate -The following presents the net pension liability of the Local Government for each Plan, calculated using the discount rate for each Plan, 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 or 1 percentage point higher than the current rate:

Pension Plan Fiduciary Net Position - Detailed information about each pension plan's fiduciary net position is available in the separately issued CalPERS financial reports.

NOTE 11 – NET POSITION AND FUND BALANCES
Governmental and Business -Type Activities
Net Position
GASB Statement No. 63 requires that the difference between assets added to the deferred outflows of resources and liabilities added to the deferred inflows of resources be reported as net position. In the Government-wide financial statements, proprietary fund financial statements, and private-purpose trust fund financial statements, net position is classified as either net investment in capital assets, restricted, or unrestricted.
 Net Investment in Capital Assets describes the portion of net position which is represented by the current net book value of the City’s capital assets, less the outstanding balance of any debt issued to finance these assets.
 Restricted describes the portion of net position, which is restricted as to use by the terms and conditions of agreements with outside parties, governmental regulations, laws, or other restrictions which the City cannot unilaterally alter. These principally include debt service requirements, capital projects, and deferred improvement funds restricted to low and moderate income housing purposes.
 Unrestricted describes the portion of net position which is not restricted as to use.

When both restricted and unrestricted net position are available, restricted resources are depleted first before the unrestricted resources are used.

Safety Miscellaneous Combined Total
1% Decrease 6.15% 6.15% 6.15%
Net Pension Liability 7,864,884 $ $ 8,703,930 $ 16,568,814 Current Discount Rate 7.15% 7.15% 7.15%
Net Pension Liability 5,256,890 $ $ 5,468,855 $ 10,725,745 1% Increase 8.15% 8.15% 8.15%
Net Pension Liability 3,118,743 $ $ 2,798,530 $ 5,917,273 52 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 11 – NET POSITION AND FUND BALANCES (CONTINUED)
Fund Balances
Fund balance is classified as nonspendable, restricted, committed, assigned and/or unassigned based primarily on the extent to which the City is bound to observe constraints imposed upon the use of the resources in the government funds.

NOTE 12 – RISK MANAGEMENT
The City is exposed to various risks of loss related to theft of, damage to, and destruction of assets including low value vehicle coverage; errors and omissions; injuries to employees and natural disasters. The City participates with other public entities in a joint venture under a joint powers agreement, which establishes the Central San Joaquin Valley Risk Management Authority (CSJVRMA) as a common risk management and insurance program. The relationship between the City and CSJVRMA is such that CSJVRMA is not a component of the City for financial reporting purposes.

CSJVRMA maintains separate records for each year of participation. The records track cash paid to the RMA through deposit premium assessments, the City’s self-insurance retention portion of claims paid, and the City’s allocation of shared risks. Three years after the close of the workers’ compensation coverage year and five years after the close of the general liability coverage year, CSJVRMA assesses the status of all members for that year and issues a refund to a member if it has a positive balance (i.e., payout and reserve experience is less than premium paid) or collects any deficit.

Worker’s Compensation
The City is self-insured for the first $50,000 of each claim. The City participates in a risk sharing pool through CSJVRMA for claims between $50,000 and $500,000. The CSJVRMA participates in another excess pool, which provides workers’ compensation coverage from $500,000 to $4,500,000 and purchases excess reinsurance above $5,000,000 to the statutory limit through the Local Agency Workers’ Compensation Excess Joint Powers Authority (LAWCX).

General Liability
The City is self-insured for the first $25,000 of each claim. The City participates in a risk sharing pool through CSJVRMA for claims between $25,000 and $1,000,000. The CSJVRMA is a member of the California Affiliated Risk Management Authorities (CARMA) program for the purpose of obtaining excess coverage in a risk sharing pool. The CARMA program provides coverage from $1,000,000 to $29,000,000.

The CARMA program has 54 members participating in the pooled liability program during the 2018/2019 fiscal year. CSJVRMA was established under the provisions of California Government Code Section 6500 et seq. The CSJVRMA is governed by a Board of Directors, which meets three to four times per year, consisting of one member appointed by each member city. The day-to-day business is handled by a management group employed by the CSJVRMA.
53 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 12 – RISK MANAGEMENT (CONTINUED)
The financial position and results of operations for the CSJVRMA as of June 30, 2020, is presented below:

At the termination of the joint powers agreement and after all claims have been settled, any excess or deficit will be divided among the cities in accordance with its governing documents. Audited financial statements are available from the Central San Joaquin Risk Management Authority at 6371 Auburn Boulevard, Citrus Heights, CA 95621.

During the past three fiscal years, none of the above programs of protection have had settlements or judgments that exceeded pooled or insured coverage. There have been no significant reductions in pooled or insured liability coverage from coverage in the prior fiscal year.

NOTE 13 – COMMITMENTS AND CONTINGENCIES
The City has received State and Federal funds for specific purposes that are subject to review by the grantor agencies. Although such audits could generate expenditure disallowances under the terms of the grants, it is believed that any required reimbursements will not be material.

From time to time, the City is involved in various litigation matters incidental to operations, which in the opinion of the City, the ultimate outcome will not a material effect on operations.

The City is a lessor in certain month – to – month leases. In addition, the City leases properties under noncancelable operating leases. Minimum rents due under these leases are as follows:

Total Assets $ 140,373,479
Total Liabilities $ 120,609,137
Total Retained Earnings 19,764,342
Total Liabilities and Retained Earnings 140,373,479 $
Revenues for Fiscal Year $ 58,244,856
Expenses for Fiscal Year 57,261,330
Change in Net Position $ 983,526
Fiscal Year
Ending
June 30, Amount
2021 $ 36,000
2022 36,000
2023 36,000
2024 36,000
2025 36,000
Thereafter 126,000
Total $ 306,000
54 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 14 – FUND EQUITY
Fund Balance – Governmental Funds
As of June 30, 2020, fund balances of the governmental funds are classified as follows:
 Nonspendable – amounts that cannot be spent either because they are in nonspendable form or because they are legally or contractually required to be maintained intact.  Restricted – amounts that can be spent only for specific purposes because of constitutional provisions or enabling legislation or because of constraints that are externally imposed by creditors, grantors, contributors, or the laws or regulations of other governments.  Committed – amounts that can be used only for specific purposes determined by a formal action of the governing board as the highest level of decision-making authority for the City.

Commitments may be established, modified, or rescinded only through ordinances or resolutions approved by the governing board.
 Assigned – amounts that do not meet the criteria to be classified as restricted or committed but that are intended to be used for specific purposes. Under the City’s adopted policy, only the governing board or director may assign amounts for specific purposes.  Unassigned – all other spendable amounts.

Fund Balance – Governmental Funds
When an expenditure is incurred for purposes for which both restricted and unrestricted fund balance is available, the City considers restricted funds to have been spent first. When an expenditure is incurred for which committed, assigned, or unassigned fund balances are available, the City considers amounts to have been spent first out of committed funds, then assigned funds, and finally, unassigned funds, as needed, unless the City Council has provided otherwise in its commitment or assignment actions.

General
Revolving
Loan Fund
CDBG
Revolving
Loan Fund
Home
WWTP
Capital
Projects
Total Non-major
Governmental
Funds Total
Nonspendable:

Prepaid items $ 96,619 $ - $ - $ - $ - 96,619 $
Total Nonspendable 96,619 - - - - 96,619

Restricted for:

Streets and roads - - - - 579,073 579,073
Public safety - - - - 259,858 259,858
Public works - - - - - -
Community development - 17 47,320 - 33,131 80,468
Capital Projects - WWTP - - - 4,295,059 - 4,295,059
Total Restricted - 17 47,320 4,295,059 872,062 5,214,458

Unassigned 804,312 - - - (205,434) 598,878

Total Fund Balances $ 900,931 $ 17 $ 47,320 $ 4,295,059 $ 666,628 $ 5,909,955 55 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 15 – AGREEMENTS
Under agreements between the City of Taft, the Taft Heights Sanitation District, and the Ford City Sanitation District dated May 29, 1950, amended on March 7, 1966, restated April 24, 1972, and restated August 21, 1991, covering the “Joint Sewage Project – 1972,” the City operates and maintains the Wastewater Treatment Plant (WWTP) serving the City and the two Sanitation Districts. The City includes the activities of the WWTP within its fund structure since the Agreement specifies that the City shall act on its own behalf and on behalf of the other Districts in operating and maintaining the WWTP. The City maintains the accounting records for the WWTP and has physical custody of its assets. The Agreement specifies that the City shall contribute 52 percent of the revenue required to operate and maintain the WWTP, with the other Districts providing a combined 48 percent of the operating revenue. Since the WWTP is not a separate legal entity, it is not considered a component unit.

NOTE 16 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY
On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X 26 (“the Bill”) that provides for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City of Taft that previously had reported a redevelopment agency within the reporting entity of the City as a blended component unit.

On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X 26 (“the Bill”) that provides for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City of Taft that previously had reported a redevelopment agency within the reporting entity of the City as a blended component unit.

The Bill provides that upon dissolution of a redevelopment agency, either the City or other unit of local government will agree to serve as the “successor agency” to hold the assets until they are distributed to other units of state and local government. On January 17, 2012, the City Council elected to become the Successor Agency for the former redevelopment agency in accordance with the Bill as part of City resolution number 12.

After enactment of the law, which occurred on June 28, 2011, redevelopment agencies in the State of California cannot enter into new projects, obligations, or commitments. Subject to the control of a newly established oversight board, remaining assets can only be used to pay enforceable obligations in existence as the date of the dissolution (including the completion of any unfinished projects that were subject to legally enforceable contractual commitments).

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

The Bill directs the State Controller of the State of California review the propriety of any transfers of assets between redevelopment agencies and other public bodies that occurred after January 1, 2011. If the public body that received such transfers is not contractually committed to a third party for the expenditure or encumbrance of those assets, the state Controller is required to order the available assets to be transferred to the public body designated as the successor agency by the Bill.

56 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 16 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT

AGENCY (CONTINUED)
Prior to that date, the final seven months of activity of the redevelopment agency continued to be reported in the governmental funds of the City. After the date of dissolution, the assets and activities of the dissolved redevelopment agency are reported in a fiduciary fund (private-purpose trust fund) in the financial statements of the City.

Capital Asset activity for the fiscal year ended June 30, 2020 was as follows:

Loans payable to the City of Taft totaling $1,588,959 were made to the former Redevelopment Agency by the City for the purchase of land for redevelopment purposes. These loans were approved to be repaid by the California Department of Finance and are listed on the Recognized Obligation Payment Schedule (ROPS) of the Successor Agency Trust Fund. There is no scheduled date of repayment as all taxes and assessments collected each year are currently being used to satisfy other obligations of the Successor Agency Trust Fund that are due and payable.

The following is a schedule of long-term liabilities for the fiscal year ended June 30, 2020:

The former Redevelopment Agency and the Taft Financing Authority entered into a loan agreement dated November 1, 1998 pursuant to which the former Redevelopment Agency borrowed proceeds of the 1998 Revenue Refunding bonds and agreed to make loan payments to the Taft Financing Authority. On December 1, 1998, the Taft Financing Authority issued $5,060,800 of 1998 Revenue Refunding Bonds for.

Balance Balance
July 1, 2019 Additions Deletions June 30, 2020
Capital assets not being depreciated:

Land $ 1,698,163 $ - $ 1,698,163 - $
Total capital assets not being depreciated 1,698,163 - - 1,698,163 Capital assets being depreciated:

Structures and improvements 407,116 - 407,116 -
Total capital assets being depreciated 407,116 - - 407,116 Less accumulated depreciation for:

Structures and improvements (256,662) (10,177) (266,839) - Total accumulated depreciation (256,662) (10,177) (266,839) - Total capital assets, being depreciated
net of accumulated depreciation 150,454 (10,177) 140,277 - Total Governmental activities capital assets,
net of accumulated depreciation $ 1,848,617 $ (10,177) $ 1,838,440 - $ Balance Balance Due in
July 1, 2019 Additions Deletions June 30, 2020 One Year 2019 Revenue Refunding Bonds 1,778,000 $ $ (191,000) - $ $ 1,587,000 $ 191,000 Total long-term liabilities 1,778,000 $ $ (191,000) - $ $ 1,587,000 $ 191,000 57 CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2020
NOTE 16 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT

AGENCY (CONTINUED)
the purpose of refinancing the 1993 Revenue Bonds and certain loans from the City of Taft. The 1998 Revenue Bonds interest rates range from 4.25 to 5.80%. Interest is payable semiannually each January 1and July 1 and principal is paid annually each January 1 through 2028. Tax increment revenue is pledged as collateral for the repayment of the bonds. In addition, the City of Taft agreed to lease the police station and the lease payments were pledged to the payment of the 1998 Revenue Bonds. After dissolution of the Redevelopment Agency, these bonds were paid from the Successor Agency Trust Fund.

The portion of the 1998 Revenue Bonds related to the lease of the police station should have been reported as a long-term liability of the governmental activities of the City. Accordingly, the Successor Agency Trust reduced the opening net deficit by $557,053 as of July 1, 2018. The restatement consisted of an increase in net position of $905,000 for the principal balance related to the lease of the police statement as of June 30, 2018, an increase of $26,245 for the interest payable as of June 30, 2018 and a decrease in net position for the cash with fiscal agents of $374,192.

The City, the Taft Public Financing Authority, and the Successor Agency Trust Fund desired to refinance the 1998 Revenue bonds. On June 1, 2019, the Taft Public Financing Authority issued $2,310,000 Revenue Refunding Bonds and entered into a loan agreement with the Successor Agency Trust Fund to acquire the aggregate principal of $1,778,000. The Taft Financing Authority assigned these payments to the former Redevelopment Agency
Taft Public Financing Authority issued the 2019 Revenue Refunding Bonds for $2,310,000 of which $1,587,000 was recorded as a long-term liability of the Successor Agency Trust. The first payment of principal and interest is due on August 1, 2019. Principal and interest are due semiannually on August 1st and February 1 with the last payment due on February 1, 2028. The bonds have an interest rate of 3.14%.

The maturity schedule of the bonds is as follows:

NOTE 17 - OTHER MATTERS
Pursuant to City Resolution No. 3392-12 dated January 11, 2012, which was in part the result of the California Supreme Court’s ruling in California Redevelopment Association vs. Matosantos Case No.

S194861 which upheld AB26x1 that dissolved all of the redevelopment agencies in California, the City determined that it is in the best interests to serve as Successor Agency.

Further, pursuant to the above Resolution, the City had the Taft Housing Authority assumed all rights, powers, assets, liabilities, duties, and obligations associated with housing activities of the Taft Community Development Agency. City Resolution 3284, dated March 15, 2011, created a Housing Authority and designated City Council members as the Housing Authority Commissioners. Presently, any Taft Housing Authority expenditure actions need approval of the Successor Agency.

PRINCIPAL INTEREST TOTAL
2021 179,000 $ 48,435 $ 227,435 $
2022 181,000 42,798 223,798
2023 188,000 37,052 225,052
2024 194,000 31,101 225,101
2025 199,000 24,979 223,979
2026-2029 646,000 35,921 681,921
Total $ 220,286 1,587,000 $ 1,807,286 $
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59 CITY OF TAFT

MAJOR FUND BUDGETARY COMPARISON SCHEDULES
JUNE 30, 2020
Budgetary comparison schedules are presented as Required Supplementary Information for the General Fund as provided for by GASB Statement No. 34. The budgetary comparison schedules for the remaining major funds are presented to aid in additional analysis and is not a required part of the basic financial statements or Required Supplementary Information.

Budgets were not adopted for the Revolving Loan Fund CDBG and Revolving Loan Fund Home. 60 This page intentionally left blank

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

GENERAL FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
Variance with
Final Budget
Original Actual Positive
Budget Final Budget Amounts (Negative)

REVENUES
Property taxes $ 1,459,975 $ 1,574,759 $ 1,574,559 $ (200) Sales taxes 1,199,610 1,399,041 1,425,489 26,448
Other taxes 533,924 614,460 614,460 -
Licenses and permits, and fees 243,825 294,998 294,997 (1) Fines and forfeitures 2,115 2,393 2,393 -
Use of money and property 192,277 142,114 158,773 351,050 Intergovernmental 60,000 375,447 402,106 26,659
Current services charges 3,544,933 3,544,319 3,544,320 1 Other 21,743 250,498 336,682 86,184
Total revenues 7,208,239 8,248,192 8,546,056 297,864

EXPENDITURES
Current:

General government 1,841,617 1,556,900 1,670,987 (114,087) Public safety 3,703,739 3,692,004 3,615,128 76,876
Public works 1,390,549 1,089,356 1,088,900 456
Community development 743,046 684,559 684,562 (3)
Capital outlay 1,302,602 1,206,596 1,203,778 2,818
Debt service :

Debt issuance cost
Principal - - 87,000 (87,000)
Interest - - 10,260 (10,260)
Total expenditures 8,981,553 8,229,415 8,360,615 (131,200) Excess (deficiency) of revenues
over expenditures (1,773,314) 18,777 185,441 166,664

OTHER FINANCING SOURCES (USES)
Proceeds from issuance of debt
Transfers in 1,773,314 48,173 653,805 605,632
Total other financing sources (uses) 1,773,314 48,173 653,805 605,632 Net change in fund balance - 66,950 839,246 772,296
Fund balance, beginning of fiscal year 61,685 61,685 61,685 - Fund balance, end of fiscal year $ 61,685 $ 128,635 $ 900,931 $ 772,296 61 64
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65 CITY OF TAFT

MAJOR CAPITAL PROJECT FUND
JUNE 30, 2020
WWTP Capital Projects Fund
The WWTP Capital Projects Fund is used to account for capital asset acquisition and construction of the wastewater treatment plant.

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

WWTP CAPITAL PROJECTS FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
Variance with
Final Budget
Original Actual Positive
Budget Final Budget Amounts (Negative)

REVENUES
Use of money and property 20,000 $ 28,996 $ 28,996 $ -$ Total revenues 20,000 28,996 28,996 -

OTHER FINANCING SOURCES (USES)
Transfers in 147,255 147,255 131,200 (16,055)
Transfers out (167,255) (176,251) - 176,251
Total other financing sources (uses) (20,000) (28,996) 131,200 160,196 Net change in fund balance - - 160,196 160,196
Fund balance, beginning of fiscal year 4,134,863 4,134,863 4,134,863 - Fund balance, end of the fiscal year $ 4,134,863 $ 4,134,863 $ 4,295,059 $ 160,196 68 66
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69 CITY OF TAFT

NON-MAJOR GOVERNMENTAL FUNDS
JUNE 30, 2020

SPECIAL REVENUE FUNDS
Traffic Safety
This Fund was established to receive the City’s share of traffic fines and reimburse the General Fund for police activities related to traffic safety and traffic control devices.

Gas Tax
This fund was established to receive a share of the revenues derived from the State taxes on gasoline.

Inmate Welfare Trust
The inmate welfare trust fund account is established and maintained pursuant to Penal Code Sections 5005, 5006.1, 5007, and 5008 and the Business Administration Manual, Chapter 4200. All entries to the inmate welfare trust fund are supported by source documentation.

WWTP
This fund is used to account for special projects related to the City’s share of the wastewater treatment plant.

Transportation and Development Act (TDA)
This fund was established to receive and expend the City’s allocation of sales tax under SB 325. This bill reduced the State’s percentage of sales tax by 1.4 percent and allowed the counties within the State of California to increase their sales tax percentage by ¼ percent. The funds generated by this ¼ percent are allocated to the counties and a portion of this is then allocated to the cities within each county and restricted to street purposes.

Cal Home Revolving Loan
This fund was established to account for all CalHome grant received by the City.

Tarp Revolving Loan
This fund was established to account for funds received from the State of California CDBG program whose intent is to provide financing to new and existing businesses for a healthy economic environment.

Asset Forfeiture
This fund was established to receive funds that are seized from narcotics dealers or following the sale of dealer assets.

Landscape Assessment District
This fund was established in connection with a single-family housing development project (Tract No. 5574) and will be used to record expenditures and revenues relative to formation and operation of a Landscape Maintenance District in that tract.

Crime Prevention
This fund was established to account for receipts from the State COPS grant program and related expenditures.

Traffic Congestion Relief
This Fund was established to utilize grant funds for road improvements and projects designed to relieve traffic congestion.

Inmate
Traffic Gas Welfare
Safety Tax Trust WWTP TDA
ASSETS
Cash and investments 24,314$ 418,448$ 55,272$ -$ 110,382$ Receivables:

Accounts - 24,941 - 500,321 -
Interest - 988 - - -
Notes - - - - -
Total assets 24,314$ 444,377$ 55,272$ 500,321$ 110,382$

LIABILITIES, DEFERRED INFLOW

OF RESOURCES, AND FUND

BALANCES

LIABILITIES
Accounts payable -$ -$ 598$ 52,597$ -$
Accrued payroll - - 457 2,825 -
Due to other funds - - - 68,666 -
Total liabilities - - 1,055 124,088 -

DEFERRED INFLOW OF

RESOURCES
Deferred revenue - - - 498,308 -

FUND BALANCES
Restricted 24,314 444,377 54,217 - 110,382
Unassigned - - - (122,075) -
Total fund balances (deficits) 24,314 444,377 54,217 (122,075) 110,382 Total liabilities, deferred inflow of
resources, and fund balances 24,314$ 444,377$ 55,272$ 500,321$ 110,382$

CITY OF TAFT

NON-MAJOR GOVERNMENTAL FUNDS

COMBINING BALANCE SHEET
June 30, 2020
Special Revenue Funds
70 Total
Cal Home TARP Landscape Traffic Non-Major
Revolving Revolving Asset Assessment Crime Congestion Governmental Loan Loan Forfeiture District Prevention Relief Funds
33,093$ 231$ 26,426$ -$ 183,440$ -$ $ 851,606
- - - 43 - - 525,305
38 - 38 - 67 - 1,131
271,610 - - - - - 271,610
304,741$ 231$ 26,464$ 43$ 183,507$ -$ 1,649,652 $
-$ 231$ -$ -$ 44$ -$ $ 53,470
- - - 287 4,286 - 7,855
- - - 83,115 - - 151,781
- 231 - 83,402 4,330 - 213,106
271,610 - - - - - 769,918
33,131 - 26,464 - 179,177 - 872,062
- - - (83,359) - (205,434) -
33,131 - 26,464 (83,359) 179,177 - 666,628
304,741$ 231$ 26,464$ 43$ 183,507$ -$ 1,649,652 $
Special Revenue Funds
71 Inmate
Traffic Gas Welfare
Safety Tax Trust WWTP TDA

REVENUES
Fines and forfeitures 2,988$ $ - -$ -$ -$
Use of money and property - 6,255 78 11,572 -
Intergovernmental - 792,411 - 549,300 -
Current service charges - 51,616 - 49,288 -
Other - 3,432 - - -
Total revenues 2,988 798,666 55,126 610,160 -

EXPENDITURES
Current:

General government - - - 786,667 -
Public safety - - - - -
Public works - - - - -
Health and welfare - 51,406 - - -
Capital Outlay - - - 16,799 -
Debt service: - - - - -
Principal retirement - - - 67,000 -
Interest and fiscal charges - - - 59,973 -
Total expenditures - 51,406 - 930,439 -
Excess of revenues
over (under) expenditures 2,988 798,666 3,720 (320,279) -

OTHER FINANCING SOURCES
(USES)
Transfers out - (625,682) - (131,200) -
Total other financing sources (uses) - (625,682) - (131,200) - Net change in fund balances 2,988 172,984 3,720 (451,479) - Fund balances (deficits), beginning of
fiscal year 21,326 271,393 50,497 329,404 110,382
Fund balances (deficits), end of fiscal
year 24,314 $ $ 444,377 54,217$ $ (122,075) 110,382$
Special Revenue Funds

CITY OF TAFT

NON-MAJOR GOVERNMENTAL FUNDS

COMBINING STATEMENT OF REVENUES, EXPENDITURES,

AND CHANGES IN FUND BALANCES
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
72 Total
Cal Home TARP Landscape Traffic Non-Major
Revolving Revolving Asset Assessment Crime Congestion Governmental Loan Loan Forfeiture District Prevention Relief Funds
-$ -$ -$ -$ -$ -$ $ 2,988
503 - 565 - 2,196 - 21,169
- - 3,522 - 155,948 10,601 1,511,782
- - - 12,470 - - 113,374
- - - - - - 3,432
503 - 4,087 12,470 158,144 10,601 1,652,745
- - - - - - 786,667
- - 16,761 - 148,394 - 165,155
- - - 24,034 - - 24,034
- - - - - - 51,406
- - - - - - 16,799
- - - - - - -
- - - - - - 67,000
- - - - - - 59,973
- - 16,761 24,034 148,394 - 1,171,034
503 - (12,674) (11,564) 9,750 10,601 481,711
- - - - - (21,294) (778,176)
- - - - - (21,294) (778,176)
503 - (12,674) (11,564) 9,750 (10,693) (296,465)
32,628 - 39,138 (71,795) 169,427 10,693 963,093
33,131$ -$ 26,464$ $ (83,359) 179,177$ -$ 666,628 $
Special Revenue Funds
73 Variance with
Final Budget
Actual Positive
Final Budget Amounts (Negative)

REVENUES
Fines and forfeitures $ 2,988 $ 2,988 $ -
Total revenues 2,988 2,988 -

OTHER FINANCING SOURCES (USES)
Transfers out (2,988) - 2,988
Total other financing sources (uses) (2,988) - 2,988
Net change in fund balance - 2,988 2,988
Fund balance, beginning of fiscal year 21,326 21,326 -
Fund balance, end of fiscal year $ 21,326 $ 24,314 $ 2,988

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

TRAFFIC SAFETY SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
74 Variance with
Final Budget
Actual Positive
Final Budget Amounts (Negative)

REVENUES
Use of money and property $ 6,255 6,187 $ 68 $
Intergovernmental 792,411 798,503 (6,092)
Total revenues 804,690 798,666 (6,024)

OTHER FINANCING SOURCES (USES)
Transfers out (804,690) (625,682) 179,008
Total other financing sources (uses) (804,690) (625,682) 179,008 Net change in fund balance - 172,984 172,984
Fund balance, beginning of fiscal year 271,393 271,393 - Fund balance, end of fiscal year $ 444,377 271,393 $ 172,984 $

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

GAS TAX SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
75 Variance with
Final Budget
Actual Positive
Final Budget Amounts (Negative)

REVENUES
Use of money and property $ 78 78 $ - $
Current service charges 51,616 51,616 -
Other 3,432 3,432 -
Total revenues 55,126 55,126 -

EXPENDITURES
Current:

Health and welfare 55,126 51,406 3,720
Total expenditures 55,126 51,406 3,720
Net change in fund balance - 3,720 3,720
Fund balance, beginning of fiscal year 50,497 50,497 -
Fund balance, end of fiscal year $ 50,497 $ 54,217 $ 3,720

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

INMATE WELFARE TRUST SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
76 Variance with
Final Budget
Actual Positive
Final Budget Amounts (Negative)

REVENUES
Use of money and property $ 11,572 $ 11,572 $ -
Intergovernmental 1,006,812 549,300 (457,512)
Current service charges 49,288 49,288 -
Other - - -
Total revenues 1,067,672 610,160 (457,512)

EXPENDITURES
Current:

General government 786,667 781,872 (4,795)
Capital outlay - 16,799 (16,799)
Debt service:

Principal retirement 67,000 67,000 -
Interest and fiscal charges 59,973 59,973 -
Total Expenditures 908,845 930,439 (21,594)
Excess (Deficiency) of Revenues
Over Expenditures 158,827 (320,279) (479,106)

OTHER FINANCING SOURCES (USES)
Transfers out (147,255) (131,200) 16,055
Total other financing sources (uses) (147,255) (131,200) 16,055 Net change in fund balance 11,572 (451,479) (463,051)
Fund balance (deficit), beginning of fiscal year 329,404 329,404 - Fund balance (deficit), end of the fiscal year $ 340,976 $ (122,075) $ 463,051

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

WWTP SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
62 Variance with
Final Budget
Actual Positive
Final Budget Amounts (Negative)

REVENUES
Intergovernmental $ - $ - $ -
Total revenues - - -

OTHER FINANCING SOURCES (USES)
Transfers out - - -
Total other financing sources (uses) - - -
Net change in fund balance - - -
Fund balance, beginning of fiscal year 110,382 110,382 - Fund balance, end of fiscal year $ 110,382 110,382 $ - $

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

TDA SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
77 Variance with
Final Budget
Actual Positive
Final Budget Amounts (Negative)

REVENUES
Use of money and property $ 565 563 $ 2 $
Intergovernmental 3,522 3,522 -
Total revenues 4,085 4,087 2

EXPENDITURES
Current:

Public safety 16,855 16,761 94
Total expenditures 16,855 16,761 94
Excess (deficiency) of revenues
over expenditures (12,770) (12,674) 96

OTHER FINANCING SOURCES (USES)
Transfers out - - -
Total other financing sources (uses) - - -
Net change in fund balance (12,674) (12,770) 96
Fund balance, beginning of fiscal year 39,138 39,138 -
Fund balance, end of fiscal year $ 26,368 $ 26,464 $ 96

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

ASSET FORFEITURE SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
78 Variance with
Final Budget
Actual Positive
Final Budget Amounts (Negative)

REVENUES
Use of money and property $ - $ - $ -
Current service charges 12,471 12,470 (1)
Total revenues 12,471 12,470 (1)

EXPENDITURES
Current:

Public works 24,138 24,034 104
Total expenditures 24,138 24,034 104
Net change in fund balance (11,564) (11,667) 103
Fund balance (deficit), beginning of fiscal year (71,795) (71,795) - Fund balance (deficit), end of fiscal year (83,462) $ (83,359) $ 103 $

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

LANDSCAPE ASSESSMENT SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
79 Variance with
Final Budget
Actual Positive
Final Budget Amounts (Negative)

REVENUES
Use of money and property $ 2,196 2,191 $ 5 $
Intergovernmental 155,948 155,948 -
Total revenues 158,139 158,144 5

EXPENDITURES
Current:

Public safety 148,394 150,760 2,366
Total expenditures 150,760 148,394 2,366
Excess (deficiency) of revenues
over expenditures 7,379 9,750 2,371

OTHER FINANCING SOURCES (USES)
Transfers out (7,379) - 7,379
Total other financing sources (uses) (7,379) - 7,379
Net change in fund balance - 9,750 9,750
Fund balance, beginning of fiscal year 169,427 169,427 - Fund balance, end of fiscal year $ 179,177 169,427 $ 9,750 $

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

CRIME PREVENTION SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
80 Variance with
Final Budget
Actual Positive
Final Budget Amounts (Negative)

REVENUES
Intergovernmental $ 10,601 $ 10,601 $ -
Total revenues 10,601 10,601 -

OTHER FINANCING SOURCES (USES)
Transfers out (10,601) (21,294) (10,693)
Total other financing sources (uses) (10,601) (21,294) (10,693) Net change in fund balance - (10,693) (10,693)
Fund balance, beginning of fiscal year 10,693 10,693 -
Fund balance, end of fiscal year $ 10,693 $ - $ (10,693)

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

TRAFFIC CONGESTION RELIEF SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
81 82
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83 CITY OF TAFT

PRIVATE-PURPOSE TRUST FUNDS AND AGENCY FUNDS
JUNE 30, 2020
Private-Purpose Trust Funds are used to account for assets and liabilities held by the City of Taft in a trustee capacity.

Capital Projects Fund
This fund is used to account for capital assets and other activities of the former redevelopment agency.

Post RDA Debt Retirement Fund
This fund is used to account for administration and debt retirement activities related to the former redevelopment agency.

AGENCY FUNDS DESCRIPTION
Trust and agency funds were established to control money held by the City as agent or trustee. The collections reflected in these funds are not revenues to the City and disbursements do not represent expenditures of the City. Accordingly, these funds do not employ the budgetary accounting procedures used for the other funds.

Inmate Trust Fund
The Inmate Trust Account maintains those accounting records necessary to provide for the recording of all transactions affecting the inmate trust accounts. It also provides accurate and current information relative to each individual inmate trust account.
1997-A Lease Revenue Bond Fund
This fund is used to account for resources held related to nonobligatory conduit debt. The City acts as an agent by collecting payments and forwarding them to a trustee on behalf of the bondholders. 84 This page intentionally left blank

CITY OF TAFT

COMBINING STATEMENT OF NET POSITION

PRIVATE PURPOSE TRUST FUNDS
JUNE 30, 2020
Post RDA
Capital Debt
Projects Retirement
Fund Fund Total
ASSETS
Cash and investments $ 188,498 - $ $ 188,498
Interest receivable - 154 154
Prepaid items - - -
Capital assets - nondepreciable 1,698,163 - 1,698,163
Capital assets - being depreciated 407,116 - 407,116
Capital assets - accumulated depreciation (266,839) - (266,839) Total assets 1,838,440 188,652 2,027,092

LIABILITIES
Accounts payable - 11,520 11,520
Accrued payroll - 888 888
Accrued interest payable - 7,237 7,237
Unearned revenue - - -
Advance due to City of Taft 1,588,959 - 1,588,959
Bonds payable 1,587,000 - 1,587,000
Total liabilities 3,195,604 - 3,195,604

NET POSITION (DEFICIT)
Unrestricted 1,838,440 (2,999,715) (1,161,275)
Total Net Position (Deficit) $ 1,838,440 $ (3,006,952) $ (1,168,512) 85 Post RDA
Capital Debt
Projects Retirement
Fund Fund Total
Additions:

Investment revenue $ - $ 1,204 $ 1,204
Taxes and assessments - 316,548 316,548
Total additions - 317,752 317,752
Deductions:

Community development - 130,132 130,132
Interest expense - 42,345 42,345
Depreciation 10,177 - 10,177
Total deductions 10,177 172,477 182,654
Change in net position 145,275 (10,177) 135,098
Net Position (Deficit) - beginning of fiscal year (3,152,227) 1,848,617 (1,303,610) Net Position (Deficit) - end of fiscal year $ 1,838,440 $ (3,006,952) $ (1,168,512)

CITY OF TAFT

PRIVATE PURPOSE TRUST FUNDS

COMBINING STATEMENT OF CHANGES IN NET POSITION
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
86 Inmate
Trust
Fund
ASSETS
Cash and investments $ 116,813
Total assets $ 116,813

LIABILITIES
Accounts payable $ 116,813
Total liabilities $ 116,813

CITY OF TAFT

STATEMENT OF ASSETS AND LIABILITIES

AGENCY FUND
JUNE 30, 2020
87 CITY OF TAFT

AGENCY FUND

STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
July 1, 2019 June 30, 2020
Balance Additions Reductions Balance
ASSETS
Cash and investments $ 420,859 87,788 $ (391,834) $ 116,813 $ Total assets $ 87,788 $ 420,859 $ (391,834) $ 116,813

LIABILITIES
Accounts payable $ 5,074 $ - $ (5,074) $ -
Due to inmates 82,714 420,859 (386,760) 116,813
Total liabilities $ 87,788 $ 420,859 $ (391,834) $ 116,813 Inmate Trust Fund
88 REVIEWED BY:

CITY CLERK FINANCE DIRECTOR CITY MANAGER
City of Taft Agenda Report
____________________________________________________________________________________________________________ DATE: November 19, 2024
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:
2ND READING AND ADOPTION OF ORDINANCE AUTHORIZING AN AMENDMENT TO THE CONTRACT BETWEEN THE CITY OF TAFT AND THE CALIFORNIA PUBLIC EMPLOYEES’

RETIREMENT SYSTEM
SUMMARY STATEMENT:

On October 15, 2024 the City Council adopted a Resolution of Intent for the purposes of an amendment to the city’s contract with the California Public Employees’ Retirement System.

Now that amendment is being brought to the Council as an ordinance authorizing said amendment. This amendment is for the sole purpose of adding and allowing Section 20903 (Two-Years Additional Service Credit) for miscellaneous members and local safety members, which was inadvertently not included in the original contract. Anticipated costs for this addition are outlined below.

RECOMMENDATION:

Motion to approve and amend the City of Taft Municipal Code and adopt an Ordinance entitled AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TAFT ADDING SECTION 1-7-6 TO CHAPTER 7 OF TITLE 1 AUTHORIZING AN AMENDMENT TO THE CONTRACT BETWEEN

THE CITY COUNCIL OF THE CITY OF TAFT AND THE BOARD OF ADMINISTRATION OF THE CALIFORNIA PUBLIC EMPLOYEES’ RETIREMENT SYSTEM and find that the activity is not a project per the California Environmental Quality Act (CEQA) as set forth in Section 15060(c)(3) and Section 15378 of the CEQA Guidelines.

IMPACT ON BUDGET (Y/N): Yes, the cost is anticipated to be approximately $99,000 which will be assessed as part of the City’s CalPERS
contribution rates beginning in FY 2027/2028.

ATTACHMENT (Y/N): Yes, Ordinance and Draft Agreement (Exhibit) PREPARED BY: Lonn Boyer, Assistant City Manager/HR Director ORDINANCE NO. 853-24

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
TAFT ADDING SECTION 1-7-6 TO CHAPTER 7 OF TITLE 1

AUTHORIZING AN AMENDMENT TO THE CONTRACT

BETWEEN THE CITY COUNCIL OF THE CITY OF TAFT AND

THE BOARD OF ADMINISTRATION OF THE CALIFORNIA
PUBLIC EMPLOYEES’ RETIREMENT SYSTEM
WHEREAS, the City Council of the City of Taft and the Board of Administration of the California Public Employees’ Retirement System originally entered into a contract effective February 16, 1976, and witnessed January 5, 1976, being amended effective June 21, 1993, October 3, 1996, and August 17, 2000, which provides for participation of the City of Taft in said System; and
WHEREAS, a Resolution of Intention to approve another amendment to such contract was approved and adopted by the City Council of the City of Taft at their regularly scheduled meeting on October 15, 2024 for the purpose of said amendment; and WHEREAS, the City Council of the City of Taft now intends to approve and memorialize this amendment and authorize the Mayor to execute the amendment on behalf of the City; and

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TAFT DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. That an amendment to the contract between the City Council of the City of Taft and the Board of Administration, California Public Employees’ Retirement System is hereby authorized a copy of said amendment being attached hereto, marked Exhibit, and by such reference made a part hereof as though herein set out in full.

SECTION 2. The Mayor of the City Council of the City of Taft is hereby authorized, empowered, and directed to execute said amendment for and on behalf of said Agency.

SECTION 3. This Ordinance shall take effect thirty (30) days after the date of its adoption, and within fifteen (15) days after its adoption shall be published at least once in the Daily Midway Driller, a newspaper of general circulation, published and circulated in the City of Taft together with the names of members of the City Council voting for and against the same and thenceforth and thereafter the same shall be in full force and effect.

PASSED AND ADOPTED on this 19th day of November, 2024.
_________________________
Dave Noerr, Mayor
Attest:
____________________________
Yvette Mayfield, MMC
City Clerk
Approved as to form:
____________________________
Jason Epperson, City Attorney
Ordinance No. 853-24
November 19, 2024