Agenda — Taft City Council, March 3, 2026

TAFT CITY COUNCIL/SUCCESSOR AGENCY

JOINT REGULAR MEETING AGENDA
TUESDAY, MARCH 03, 2026

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 Bryant
Councilmember Krier
Councilmember Waldrop
Councilmember Chavira

1. PUBLIC HEARING – 2025 ANNUAL PROGRESS REPORT (APR) FOR THE CITY OF TAFT’S 6TH

CYCLE HOUSING ELEMENT AND GENERAL PLAN
Recommendation –

1. Open the Public Hearing to receive comments on the Housing Element Annual Progress Report and General Plan Annual Progress Report.

2. Motion to approve a resolution entitled 2025 ANNUAL PROGRESS REPORT (APR) FOR THE CITY OF TAFT’S 6TH CYCLE HOUSING ELEMENT AND GENERAL PLAN AND AUTHORIZING ITS

SUBMITTAL TO THE CALIFORNIA DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT AND THE GOVERNOR’S OFFICE OF LAND USE AND CLIMATE CHANGE and find that the project is exempt from the requirements of the California Environmental Quality Act (CEQA) as set forth in Section 15061(b)(3) of the CEQA guidelines.

2. 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.

3. COUNCIL STATEMENTS (NON-ACTION)

4. DEPARTMENT REPORTS

5. CITY MANAGER STATEMENTS

6. CITY ATTORNEY STATEMENTS
City of Taft Council/Successor Agency Meeting
Agenda
March 03, 2026

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7. FUTURE AGENDA REQUESTS
***************************************************************************************************** CONSENT CALENDAR ITEMS 8-16
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?

8. MINUTES
February 17, 2026 Regular
Recommendation – Approve as submitted.

9. PAYMENT OF BILLS
Warrant # 022026 Check No. 201619-201626 $ 74,290.19
Warrant # 022726 Check No. 20627-201709 $ 549,324.69
Recommendation – Approve payment of the bills.

10. CANCELLATION OF JULY 7, 2026 CITY COUNCIL MEETING
Recommendation –
Motion to approve the cancellation of the July 07, 2026 City Council Meeting.

11. UPDATE TO THE ADMINISTRATIVE POLICIES AND PROCEDURES TO APPROVE AND ADOPT SOCIAL MEDIA POLICY SECTION 129
Recommendation –
Motion to approve and adopt Social Media Policy Section 129 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. CITY INVESTMENT POLICY ANNUAL REVIEW
Recommendation –
Motion to concur with the Finance Committee’s recommendation to adopt the policy with no changes 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. TRANSPORTATION DEVELOPMENT ACT FUNDS ANNUAL AUDIT – FY 2020-2021 Recommendation –
Motion to receive and file the City of Taft Transportation Development Act Funds Annual Audit for the fiscal year 2020-2021 and find that the activity is not a project per the California City of Taft Council/Successor Agency Meeting
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March 03, 2026

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Environmental Quality Act (CEQA) as set forth in Section 15060(c)(3) and Section 15378 of the CEQA Guidelines.

14. TRANSPORTATION DEVELOPMENT ACT FUNDS ANNUAL AUDIT – FY 2021-2022 Recommendation –
Motion to receive and file the City of Taft Transportation Development Act Funds Annual Audit for the fiscal year 2021-2022 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.

15. ANNUAL AUDITED FINANCIAL STATEMENTS FOR FY 2021-2022 Recommendation –
Motion to receive and file the Annual Audited Comprehensive Financial Reports for the year ended June 30, 2022 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.

16. FINANCE AND HUMAN RESOURCE STAFF TO ATTEND TYLER MUNIS 2026 ANNUAL TRAINING IN LAS VEGAS, NEVADA, TO BE HELD ON APRIL 7 – 10, 2026 Recommendation –
Motion to approve funds from capital reserves of $1,000, for Human Resources and to approve the out of state travel for Finance and HR employees to attend Tyler Connect 2026 training in Las Vegas, Nevada from April 7 – 10th, 2026.

17. TYLER MUNIS AGREEMENT FOR CLOUD SERVICES
Recommendation –
Motion to authorize the Mayor to execute the agreement with Tyler Technologies for Cloud Services. ******************************************************************************************************

CLOSED SESSION
A. CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATION Government Code Section 54956.9(b) – One (1) undisclosed case B. CONFERENCE WITH LABOR NEGOTIATOR, CRAIG JONES, CITY MANAGER Government Code 54957.6 – All units

ADJOURNMENT
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’ City of Taft Council/Successor Agency Meeting
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March 03, 2026

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notice will help ensure that reasonable arrangements can be made.

AFFIDAVIT OF POSTING
I, Faith Melton, 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 February 26th, 2026, 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 February 26th, 2026, at Taft, California.

Signature ___________ _________
City of Taft Agenda Report
DATE: MARCH 03, 2026
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:

PUBLIC HEARING – 2025 ANNUAL PROGRESS REPORT (APR) FOR THE CITY OF TAFT’S 6TH

CYCLE HOUSING ELEMENT AND GENERAL PLAN
SUMMARY STATEMENT:

California Government Code Section 65400 requires each governing body (City Council or Board of Supervisors) to prepare an annual progress report (APR) on the status and progress in implementing the jurisdiction’s Housing Element of the General Plan and a separate APR on all elements of the General Plan using forms and definitions adopted by the Department of Housing and Community Development (HCD). Housing Element and General Plan reports are due for each calendar year on the following April 1 and must be sent to HCD and the Governor’s Office of Land Use and Climate Innovation (LCI).

The 2025 calendar year is the second year of the current Housing Element 6th Cycle of 2023 to 2031. The attached Housing Element APR identifies the housing activity data for the 2025 calendar year and status of Housing Element programs. The attached General Plan APR summarizes the progress and implementation of the General Plan programs as of the 2025 calendar year.

The Planning Commission reviewed and accepted the report at their meeting on February 4, 2026.

Staff is recommending that the City Council review and file the Housing Element APR and General Plan APR for the 2025 calendar year. Once accepted, Staff will electronically submit a copy of both APRs to HCD and LCI.

RECOMMENDED ACTION:

1. Open the Public Hearing to receive comments on the Housing Element Annual Progress Report and General Plan Annual Progress Report.

2. Motion to approve a resolution entitled 2025 ANNUAL PROGRESS REPORT (APR) FOR THE CITY OF TAFT’S 6TH CYCLE HOUSING ELEMENT AND GENERAL PLAN AND AUTHORIZING

ITS SUBMITTAL TO THE CALIFORNIA DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT AND THE GOVERNOR’S OFFICE OF LAND USE AND CLIMATE CHANGE and find that the project is exempt from the requirements of the California Environmental Quality Act (CEQA) as set forth in Section 15061(b)(3) of the CEQA guidelines.

IMPACT ON BUDGET: No
ATTACHMENT: Resolution for 2025 Annual Progress Report
PREPARED BY: City Clerk
RESOLUTION NO. 4333-26

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TAFT TO APPROVE AND CONFIRM THE FINDINGS OF THE 2025 ANNUAL

PROGRESS REPORT (APR) FOR THE CITY OF TAFT GENERAL PLAN AND 6TH CYCLE HOUSING ELEMENT (2023-2031), AUTHORIZE ITS SUBMITTAL

TO THE CALIFORNIA DEPARTMENT OF HOUSING AND COMMUNITY
DEVELOPMENT AND THE GOVERNOR’S OFFICE OF LAND USE AND

CLIMATE CHANGE, AND FIND THAT THE PROJECT IS EXEMPT FROM

THE REQUIREMENTS OF THE CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) AS SET FORTH IN SECTION 15061(B)(3) OF THE CEQA

GUIDELINES
WHEREAS, the City of Taft’s General Plan was adopted in June 2010, and amended in April 2017; and
WHEREAS, the City of Taft’s 6th Cycle Housing Element (2023-2031) was adopted by the City Council on August 19, 2025, and was determined to be in substantial compliance with State Law by the California Department of Housing and Community Development on August 22, 2025; and WHEREAS, California Government Code 65400(2) requires each jurisdiction to prepare and submit to the California Department of Housing and Community Development and the Governor’s Office of Land Use and Climate Innovation an Annual Progress Report on the status and implementation of the housing element of the general plan, and a separate report for all elements of the general plan; and WHEREAS, the City Council reviewed and considered the Annual Progress Report for the 2025 calendar year, City Staff’s written and oral reports, and all public testimony before deciding on this request; and
WHEREAS, the Planning Commission at their regular meeting on February 4, 2026, recommended the City Council accept the Annual Progress Reports for 2025; and WHEREAS, City Council finds that the laws and regulations relating to the preparation and adoption of environmental documents, as set forth in the State Guidelines Implementing the California Environmental Quality Act have been adhered to; and

NOW, THEREFORE, THE CITY COUNCIL DOES HEREBY FIND, DETERMINE, AND RESOLVE AS FOLLOWS:

1. Recitals. The City Council hereby finds that all the facts set forth in the recitals above are true and correct and incorporated herein.

2. CEQA. 2025 Annual Progress Report for the City of Taft’s General Plan and 6th Cycle Housing Element (2023-2031) are exempt from the California Environmental Quality Act pursuant to Section 15061(b)(3) of the California Environmental Quality Act Guidelines.

3. Approval and Confirmation of the 2025 Annual Progress Report. The City Council approves and confirms the 2025 Annual Progress Report for the City of Taft’s General Plan and 6th Cycle Housing Element (2023-2031) for submittal to the California Housing and Community Development Department and Governor’s Office of Land Use and Climate Innovation by the City Manager.

Resolution No.4333-26
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4. Severability: If any section, subsection, sentence, clause or phrase of this Resolution is for any reason held to be unconstitutional, such decision shall not affect the validity of the remaining sections of this Resolution. The City Council hereby declares that it would have passed this Resolution, and each section, subsection, clause and phrase thereof, irrespective of the face that any one or more sections, subsections, sentences, clauses or phrases be declared invalid or unconstitutional.

SECTION 1. The following 2025 General Plan Annual Progress Report shall be approved and confirmed by the City Council of the City of Taft as follows.
2025 General Plan Annual Progress Report
2025 General Plan
Annual Progress
Report
City of Taft
2025 General Plan Annual Progress Report
Table of Contents
Introduction...................................................................................................................................................4 Acceptance by Local Legislative Body ........................................................................................................4 General Plan Update .....................................................................................................................................5 Measures Associated with General Plan Elements.......................................................................................5 Housing Element APR..................................................................................................................................5 Compliance with LCI’s General Plan Guidelines.........................................................................................5 Housing Element.......................................................................................................................................5 Climate Change.........................................................................................................................................5 Environmental Justice...............................................................................................................................6 Tribal Consultation ...................................................................................................................................6 Priorities for Land Use Decision-Making.....................................................................................................6 Amendments to Goals, Policies, and Objectives ..........................................................................................6 Status of General Plan Element Implementation ..........................................................................................7 2025 General Plan Annual Progress Report Table...............................................................................8

1. Introduction
The purpose of this Annual Progress Report (APR) is to inform residents of the City of Taft (City) about the status of implementation of the General Plan.

The City’s General Plan Annual Progress Report (GP APR) was prepared in accordance with the guidelines established by the California Office of Land Use and Climate Innovation (LCI) and consistent with Government Code Section 64500. This report summarizes the status of General Plan objectives for each State-required element and their implementation during the 2025 calendar year, with the exception of the Housing Element, which is reported separately to the California Department of Housing and Community Development (HCD).

At a minimum, the GP APR addresses the following:
• The status of the General Plan and efforts in its implementation; and • The degree to which the City’s approved General Plan complies with the State General Plan Guidelines and the date of the last revision to the General Plan.

2. Acceptance by Local Legislative Body
The GP APR was reviewed by Planning Commission on February 4, 2026, and the City Council on March 3, 2026.

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2025 General Plan Annual Progress Report

3. General Plan Update
The General Plan was adopted by City Council on June 22, 2010. On April 18, 2017, the General Plan was amended to 1) Reduce the Planning Area to the current SOI limit with a small addition of unincorporated area to the northwest, 2) Establish an Urban Growth Boundary (UGB) to encourage more sustainable growth, and 3) Prepare a Climate Action Plan with greenhouse gas (GHG) emissions reduction actions.

4. Measures Associated with General Plan Elements
The attached GP APR summarizes the status and implementation of the General Plan objectives during the 2025 calendar year. The goals discussed in this report are specific to the following State-required General Plan elements: Land Use, Circulation, Open Space and Conservation, Safety, and Noise. The City implemented these General Plan goals through approved projects, ongoing City programs and policies, and initiatives to maintain consistency between the Municipal Code and the General Plan.

5. Housing Element APR
Government Code Section 65400 requires that each jurisdiction prepare an annual progress report on the status of the housing element and progress in its implementation, using forms and definitions adopted by the HCD. The City has prepared the 2025 Housing Element APR and submitted separately to HCD and LCI.

6. Compliance with LCI’s General Plan Guidelines
The LCI adopts and periodically updates the General Plan Guidelines, which outlines the requirements for General Plan elements. The City’s General Plan follows these requirements, ensuring that all State-required elements are included and that all mandated issues are addressed.

Pursuant to Government Code Section 65588, the Housing Element is the only element that must be periodically revised and submitted on a four-, five- or eight-year cycle, which is then certified by the HCD. Other General Plan elements are updated at the direction of the City Council following review by the Planning Commission. The City has also conducted study sessions to help ensure that the General Plan remains current and responsive to emerging issues.

1.1 Housing Element
The City Council adopted the 2023–2031 Housing Element on August 19, 2025. HCD subsequently certified the City of Taft’s Housing Element on August 22, 2025. The 2023–2031 Housing Element addresses the Regional Housing Needs Allocation (RHNA) and demonstrates a surplus of available and adequate sites to accommodate housing for all income levels throughout the planning period.

1.2 Climate Change
Pursuant to Government Code Section 65302(g), the Safety Element includes an assessment of climate change-related risks and vulnerabilities, along with adaptation and resilience strategies Resolution No.4333-26
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2025 General Plan Annual Progress Report
designed to reduce those risks. The Safety Element also references the Kern County Emergency Operations Plan and Multi-Hazard Mitigation Plan as frameworks to address both existing and future climate change-related hazards.

1.3 Environmental Justice
Pursuant to Government Code Section 65302(h) and Senate Bill (SB) 1000, jurisdictions are required to either include an environmental justice element in their general plan or incorporate environmental justice goals, policies and objectives throughout other general plan elements. The City incorporates these requirements by incorporating environmental justice considerations into the 2023-2031 Housing Element.

The 2023-2031 Housing Element incorporates environmental justice goals, policies and objectives through an Affirmatively Furthering Fair Housing (AFFH) Appendix. The AFFH analysis evaluates barriers to fair housing, identifies disparities in access to housing and opportunity, and outlines strategies/programs intended to expand housing choice and promote equitable housing outcomes.

1.4 Tribal Consultation
In compliance with state law and City policies, the City conducts tribal consultation prior to adopting or amending the General Plan, Specific Plans, and environmental documents subject to the California Environmental Quality Act (CEQA). These consultation efforts are conducted in accordance with applicable statutory requirements and are intended to ensure that tribal cultural resources are appropriately considered in land use and environmental decision-making.

While the General Plan has not been updated to reference Tribal Consultation requirements, several General Plan elements include provisions, policies, and goals that address the protection of tribal cultural resources, including historic and archaeological resources.

7. Priorities for Land Use Decision-Making
In 2025, Planning Commission and City Council considered amendments to the Zoning Ordinance and Downtown Taft Specific Plan (to implement programs identified in the 2023- 2031 Housing Element. These amendments focused on implementing Program 5 (Removal of Constraints), Program 6. (Accessory Dwelling Units), and Program 9 (Housing Production, Streamlining, and Incentives). Collectively, the amendments were intended to reduce regulatory barriers, facilitate the development of accessory dwelling units, and streamline housing approvals in order to encourage housing development consistent with State law and the Housing Element. The item was heard by Planning Commission on December 3, 2025 and City Council on December 16, 2025 and January 20, 2026.

8. Amendments to Goals, Policies, and Objectives
There were no goals, policies, and objectives, or other plan proposals that were added, deleted, amended, or otherwise adjusted.

Resolution No.4333-26
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2025 General Plan Annual Progress Report

9. Status of General Plan Element Implementation
The attached GP APR summarizes the status and implementation of the General Plan objectives during the 2025 calendar year. The Housing Element is discussed under a separate APR, per Government Code 65588.

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February 4, 2026

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2025 General Plan Annual Progress Report

1.5 2025 General Plan Annual Progress Report Table
General Plan Element Goals/Programs Status
Land Use Element LU-1
LU-2
LU-3
LU-4
LU-5
LU-6
LU-7
Status: Ongoing
Amendments: State Law limits the number of times each mandatory element of the General Plan, such as the Land Use Element, can be amended to a maximum of four times per calendar year. There were no amendments to the Land Use Element during the 2025 calendar year.

Progress toward meeting the goals of the element: Implementation is ongoing as part of the development review process. The City continues to maintain the goals of:
• A high quality of life for all residents.
• A sustainable community.
• A clean, energetic, and attractive community.
• A vibrant, active, healthy, walkable Downtown.
• An efficient growth pattern.
• Protection of the natural resources and agricultural uses in the Planning Area.
• A pattern of land use which enhances the community character of Taft, provides employment and shopping opportunities to serve residents and the region, provides for use of transit, and protects Taft’s unique historical and natural features.

Circulation Element CI-1
CI-2
CI-3
CI-4
CI-3
CI-5
Status: Ongoing
Amendments: There were no amendments to the Circulation Element during the 2025 calendar year.

Progress toward meeting the goals of the element: Implementation is ongoing.

The City continues to maintain the goals of:

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2025 General Plan Annual Progress Report
• A safe, balanced, efficient, and effective transportation system that addresses motorized, non-motorized, and pedestrian traffic movement. • An improved transportation system that will reduce the need for parking. • A circulation system which recognizes and responds to the needs of bicycle traffic and minimizes motorist/bicycle conflicts. • A well-integrated pedestrian and bicycle trail system. • A circulation system that creates a positive image of Taft and contributes to the residents’ quality of life.

Open Space and
Conservation Element
OS-1
OS-2
C-1
C-2
C-3
C-4
C-5
C-6
Status: Ongoing
Amendments: There were no amendments to the Open Space and Conservation Element during the 2025 calendar year.

Progress toward meeting the goals of the element: Implementation is ongoing.

The City continues to maintain the goals of:
• A citywide network of open space.
• Recreational opportunities for all residents.
• Protection and preservation of the agricultural landscape. • A sustainable agricultural economy.
• Conservation of native wildlife and plant communities. • A healthy water quality and supply for the community and natural environment.
• Reduction of air pollutant emissions.
• Monitoring of and response to climate change impacts, including greenhouse gas emissions.
• Efficient and sustainable development.
• Preservation and enhancement of cultural and historic resources. • Preservation of Taft’s scenic qualities.

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2025 General Plan Annual Progress Report
Noise Element N-1
N-2
N-3
Status: Ongoing
Amendments: There were no amendments to the Noise Element during the 2025 calendar year.

Progress toward meeting the goals of the element: Implementation is ongoing.

The City continues to:
• Prevent excessive levels of unwanted noise.
• Protect existing noise sensitive land uses from encroachment of and exposure to excessive levels of noise.
• Protect the City’s economic base by preventing the encroachment of noisesensitive land uses near known noise-producing sources.

Safety Element S-1 Status: Ongoing
Amendments: There were no amendments to the Safety Element during the 2025 calendar year.

Progress toward meeting the goals of the element: Implementation is ongoing.

The City continues to maintain a safe community.

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SECTION 2. The following 2025 Housing Element Annual Progress Report shall approved and confirmed City Council of the City of Taft as follows:

Resolution No.4333-26
February 4, 2026

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1. Start Here
General Information
Jurisdiction Name Taft
Reporting Calendar Year 2025
Contact Information
First Name Craig
Last Name Jones
Title City Manager
Email [email protected]
Phone 6617631222
Mailing Address
Street Address 209 E. Kern St
City Taft
Zipcode 93268

2. Summary
Data is auto-populated based on data entered in Tables A, A2, C, and D Jurisdiction Taft
Reporting Year 2025 (Jan. 1 - Dec. 31)
Housing Element Planning Period
6th
Cycle 12/31/2023 - 12/31/2031
Building Permits Issued by Affordability Summary
Income Level Current
Year
Acutely Low
Deed
Restricted
0 Non-Deed
Restricted
0 Extremely Low
Deed
Restricted
0 Non-Deed
Restricted
0 Very Low
Deed
Restricted
0 Non-Deed
Restricted
0 Resolution No.4333-26
February 4, 2026

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Low
Deed
Restricted
0 Non-Deed
Restricted
2 Moderate
Deed
Restricted
0 Non-Deed
Restricted
2 Above Moderate 0
Total Units 4
Units by Structure Type
Entitle
d Permitted
Complete
d
Single-family Attached 0 0 0
Single-family Detached 0 3 1
2 to 4 units per structure 0 1 0
5+ units per structure 0 0 0
Accessory Dwelling Unit 0 0 0
Mobile/Manufactured Home 0 0 0
Total 0 4 1
Infill Housing Developments and Infill Units Permitted
# of
Projects Units
Indicated as Infill 4 4
Not Indicated as Infill 0 0
Housing Applications Summary
Total Housing Applications Submitted: 0
Number of Proposed Units in All Applications Received: 0 Total Housing Units Approved: 0
Total Housing Units Disapproved: 0
Use of SB 423 Streamlining Provisions - Applications
Number of SB 423 Streamlining Applications 0
Number of SB 423 Streamlining Applications Approved 0
Units Constructed - SB 423 Streamlining Permits
Income Rental Ownership Total
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Acutely Low 0 0 0
Extremely Low 0 0 0
Very Low 0 0 0
Low 0 0 0
Moderate 0 0 0
Above Moderate 0 0 0
Total 0 0 0
Streamlining Provisions Used - Permitted Units
# of
Projects Units
SB 9 (2021) - Duplex in SF Zone 0 0
SB 9 (2021) - Residential Lot Split 0 0
AB 2011 (2022) 0 0
SB 6 (2022) 0 0
SB 423 (2023) 0 0
Ministerial and Discretionary Applications
# of
Application
s Units
Ministerial 0 0
Discretionary 0 0
Density Bonus Applications and Units Permitted
Number of Applications Submitted Requesting a Density Bonus 0 Number of Units in Applications Submitted Requesting a Density Bonus 0 Number of Projects Permitted with a Density Bonus 0
Number of Units in Projects Permitted with a Density Bonus 0 Housing Element Programs Implemented and Sites Rezoned Count Programs Implemented 56
Sites Rezoned to Accommodate the RHNA 0
Cells in grey contain auto-calculation formulas
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3. Table A

4. Table A2
Affordability by Household Incomes - Certificates of Occupancy Streamlin ing Historic Sites Infill
Housing with Financial
Assistance and/or Deed
Restrictions
Housing without
Financial
Assistance or
Deed
Restrictions
Term
of
Afforda
bility
or
Deed
Restric
tion
Demolished/Destroyed Units Density Bonus No
tes
10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Acute
ly
LowInco
me
Deed
Restri
cted
Acutely
LowIncome
Non
Deed
Restrict
ed
Extre
mely
LowInco
me
Deed
Restri
cted
Extre
mely
LowIncom
e Non
Deed
Restri
cted
Ver
y
Lo
wInc
om
e
De
ed
Re
stri
cte
d
Very
LowIncom
e Non
Deed
Restric
ted
Lo
wInc
om
e
De
ed
Re
stri
cte
d
LowInco
me
Non
Dee
d
Rest
ricte
d
Mode
rateInco
me
Deed
Restri
cted
Moderat
eIncome
Non
Deed
Restrict
ed
A
bo
ve
M
od
er
at
eIn
co
m
e
Certific
ates of
Occupa
ncy or
other
forms of
readine
ss
(see
instructi
ons)
Date
Issued
# of
Units
issued
Certificat
es of
Occupan
cy or
other
forms of
readines
s
Please
select
the
state
streamli
ning
provisio
n the
project
was
APPRO
VED
pursuan
t to.
(may
select
multiple
)
Is this
project
located on a
site with an
associated
historical
designation
as outlined
in
Government
Code
Section
65400(a)(2)(
N) and
reported on
Table L?
Infil
l
Uni
ts?
Y/N
+
Assista
nce
Progra
ms for
Each
Develop
ment
(may
select
multiple
- see
instructi
ons)
Deed
Restriction
Type
(may
select
multiple -
see
instruction
s)
For units
affordable
without
financial
assistance or
deed
restrictions,
explain how the
locality
determined the
units were
affordable
(see
instructions)

Term
of
Afford
ability
or
Deed
Restric
tion
(years)
(if
afforda
ble in
perpetu
ity
enter
1000)+
Num
ber
of
Dem
olish
ed/D
estr
oyed
Unit
s
De
mol
ish
ed
or
De
str
oye
d
Uni
ts
Demolis
hed/Des
troyed
Units
Owner
or
Renter
Total
Density
Bonus
Applied to
the Project
(Percentage
Increase in
Total
Allowable
Units or
Total
Maximum
Allowable
Residential
Gross Floor
Area)
Number of
Other
Incentives,
Concessio
ns,
Waivers,
or Other
Modificatio
ns Given
to the
Project
(Excluding
Parking
Waivers or
Parking
Reduction
s)
List
the
incen
tives,
conce
ssion
s,
waive
rs,
and
modif
icatio
ns
(Excl
uding
Parki
ng
Waive
rs or
Parki
ng
Modif
icatio
ns)
Did the
project
receive a
reduction
or waiver
of parking
standards?
(Y/N)
Notes+
0 0 0 0 0 0 0 0 0 1 0 1
0 0 NONE No Y Other Other
This unit was
determined to be
low-income as
for a twobedroom home,
the sale price is
$150,000.

According to the
affordability
calculator
provided by
HCD, in Kern
County this
home would be
considered lowincome.
0 Jurisdiction Taft ANNUAL ELEMENT PROGRESS REPORT Note: "+" indicates an optional field Reporting
Year 2025
(Jan. 1 - Dec.
31) Housing Element Implementation
Planning
Period 6th Cycle 12/31/2023 - 12/31/2031
Date
Application
Submitted
Total
Approved
Units by
Project
Total
Disapproved
Units by
Project
Streamlining Historic Sites Application
Status Project Type Notes
2 3 4 6 7 8 9 10 12 13 14
Prior APN+ Current APN Street
Address Project Name+
Local
Jurisdiction
Tracking ID
Unit Category
(SFA,SFD,2 to
4,5+,ADU,MH)
Tenure
R=Renter
O=Owner
Date
Application
Submitted
(see
instructions)
Acutely LowIncome Deed
Restricted
Acutely LowIncome Non
Deed
Restricted
Extremely
Low-Income
Deed
Restricted
Extremely
Low-Income
Non Deed
Restricted
Very LowIncome
Deed
Restricted
Very LowIncome
Non Deed
Restricted
LowIncome
Deed
Restricted
Low-Income
Non Deed
Restricted
ModerateIncome
Deed
Restricted
ModerateIncome
Non Deed
Restricted
Above
ModerateIncome
Total

PROPOSED
Units by
Project
Total

APPROVED
Units by
project
Total

DISAPPROV
ED Units by
Project
Please select
state
streamlining
provision/s the
application
was submitted
pursuant to.

Is this project
located on a
site with an
associated
historical
designation as
outlined in
Government
Code Section
65400(a)(2)(N)
and reported
on Table L?
Did the
housing
development
application
seek
incentives or
concessions
pursuant to
Government
Code section
65915?
Were
incentives or
concessions
requested
pursuant to
Government
Code section
65915
approved?
Please
indicate the
status of the
application.

Is the project
considered a
ministerial
project or
discretionary
project?
Notes+
Summary Row: Start Data Entry Below 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Table A
Cells in grey contain auto-calculation formulas
1 5
Project Identifier Unit Types Density Bonus Law
Applications
11 Housing Development Applications Submitted
Proposed Units - Affordability by Household Incomes
Resolution No.4333-26
February 4, 2026

Page 16 of 45 ends

0 NONE No Y Other Other
This unit was
determined to be
moderate income
as for a three
bedroom home,
the sales price is
$160,000.

According the
the affordability
calculator
provided by
HCD, in Kern
County this
home would be
considered
moderate
income.
0 0 NONE No Y Other Other
Based on
assumed rental
prices (average
monthly rent as
identified in the
Housing Element
for the city), the
units will be
affordable to low
income
households per
the affordability
calculator
provided by
HCD.
0 1 6/26/202
5 1 NONE No Y Other Other
This unit was
determined to be
mocerate income
as for a twobedroom home,
the sales price is
$149,968.

According to the
affordability
calculator
provided by
HCD, in Kern
County this
home would be
considered
moderate
income.
0 0

5. Table B
Jurisdiction Taft ANNUAL ELEMENT PROGRESS REPORT
This table is auto-populated once you enter your
jurisdiction name and current year data. Past year
information comes from previous APRs.

Reporting
Year 2025
(Jan. 1 -
Dec. 31) Housing Element Implementation
Please contact HCD if your data is different than the
material supplied here
Planning
Period 6th Cycle
12/31/2023
-
12/31/2031
Table B
Regional Housing Needs Allocation Progress
Resolution No.4333-26
February 4, 2026

Page 17 of 45 ends

Permitted Units Issued by Affordability
1 Projection
Period 2 3 4
Income Level
RHNA
Allocation
by
Income
Level
Projection
Period -
06/30/2023-
12/30/2023
2023 2024 2025 2026 2027 2028 2029 2030 2031
Total Units
to Date (all
years)
Total
Remaining
RHNA by
Income
Level
Acutely Low
Deed
Restricted
-
-
-

- -
-

Non-Deed -
Restricted - -

- -
Extremely
Low
Deed
Restricted
-

- -
-

Non-Deed -
Restricted

- -
Very Low
Deed
Restricted
68 -

- -
-

Non-Deed 68
Restricted

- -
Low
Deed
Restricted
43 -

- -
2 Non-Deed 41
Restricted

2 -

- -
Moderate
Deed
Restricted
109

- -
6 Non-Deed 103
Restricted

2 -

2 2

- -
Above
Moderate

284

- - -

284
Total RHNA

504
Total Units

2 -

2 4

- -

8 496
*For years prior to 2025, Acutely Low-Income units are reported within the Extremely Low-Income category *For jurisdictions that received RHNA determinations for the current cycle prior to the passage of AB 3093 (September 19, 2024):
- You were not allocated Acutely Low-Income and Extremely Low-Income RHNA targets, therefore the allocations in Field 1 are listed as "0" - If you wish to set your own targets in these income categories for informational purposes, contact HCD staff at [email protected]. - All Acutely Low-Income and Extremely Low-Income units reported during the cycle are counted towards Very-Low Income RHNA progress *For years prior to 2025, data on deed-restricted vs. non-deed restricted Extremely Low-Income units is approximated from whether the projects reported any deed-restricted Very Low-Income Units. If you wish to edit this historical data for accuracy or have any questions about the data, you may login to HCD's online APR system, or contact HCD staff at [email protected].

Resolution No.4333-26
February 4, 2026

Page 18 of 45 ends

Please Note: Table B does not currently contain data from Table F or Table F2 for prior years. You may login to the APR system to see Table B that contains this data.

Please note: The APR form can only display data for one planning period. To view progress for a different planning period, you may login to HCD's online APR system, or contact HCD staff at [email protected].

Resolution No.4333-26
February 4, 2026

Page 19 of 45 ends

6. Table C

7. Table D
Jurisdiction Taft
Reporting
Year 2025 (Jan. 1 - Dec. 31)
Table D
Program Implementation Status pursuant to GC Section 65583 Housing Programs Progress Report
Describe progress of all programs including local efforts to remove governmental constraints to the maintenance, improvement, and development of housing as identified in the housing element.
1 2 3 4 5 6 7 8 9
Name of
Program Objective
Projected
Completion Date
in Housing
Element
Applic
able
Cycle
Status of
Program
Implemen
tation
Program Implementation
Details
Quantified
Outcomes:

Category
Quantified
Outcomes:

Count
Supporting
Documents

1.a.No Net
Loss
No net loss of capacity below
the unmet RHNA requirement
2025 - 2031 -
monitor with APR
due 4/1
6th
Cycle
Continuou
s
Ongoing review of remaining
sites inventory. City staff
confirmed that sufficient
capacity remains.

Units None
Jurisdiction Taft ANNUAL ELEMENT PROGRESS REPORT
Reporting Year 2025
(Jan. 1 - Dec.
31) Housing Element Implementation
Planning Period 6th Cycle 12/31/2023 - 12/31/2031
Date of
Rezone Rezone Type
2 4 5 6 7 9 10 11
APN Street Address Project Name+
Local
Jurisdiction
Tracking ID+
Date of
Rezone
Very LowIncome Low-Income ModerateIncome
Above
ModerateIncome
Rezone Type Parcel Size
(Acres)
General Plan
Designation Zoning
Minimum
Density
Allowed
Maximum
Density
Allowed
Realistic
Capacity Vacant/Nonvacant Description of Existing Uses
Note: "+" indicates an optional field
Cells in grey contain auto-calculation formulas
Summary Row: Start Data Entry Below
3 8
Project Identifier RHNA Shortfall by Household Income Category Sites Description 1 Sites Identified or Rezoned to Accommodate Shortfall Housing Need and No Net-Loss Law Table C
Resolution No.4333-26
February 4, 2026

Page 20 of 45 ends

1.b.Acquisitio
n and
Development
of City-Owned
Propert
Encourage acquisition and
development of at least 71
lower income units and 458
moderate income units, for a
total of 529 units in the
Downtown Taft area
Mar. 2026 / 2028
/ 2030 - update
inventory
Dec. 2027 -
release RFP
Mar. 2028 / 2030
- monitor
progress;
consider
additional
measures
6th
Cycle
Continuou
s
Updated and posted the
inventory of City-owned
property in Q1, 2026 to the
Housing Element webpage.

Updates will occur every 2
years; next update est. Q1,
2028.

Units
https://www.cit
yoftaft.org/pvie
w.aspx?id=769
9&catid=0

1.c.Acquisitio
n and
Development
of Federally
Owned
Property
Encourage acquisition and
development of 365 above-
moderate units
Mar. 2026 6th
Cycle
Not Yet
Started
The City will prioritize this
program after Q1, 2026,
starting with establishing
contact information and
preparing and sending
correspondence.

Units None

1.d.

Acquisition
and
Development
of Large Lot
Properties
Encourage acquisition and
development of at least 263
lower, 761 moderate, and 2,537
above-moderate units, for a
total of 3,597 units
Mar. 2026 - initial
outreach
Dec. 2026 -
feasibility study
June 2027 -
initiate feasible
incentives
Mar. 2028 / 2030
- monitor
progress
6th
Cycle
Not Yet
Started
The City will prioritize this
program after Q1, 2026,
starting with establishing
contact information and
preparing and sending
correspondence.

Units None

1.e.Acquisitio
n and
Development
of Non-Vacant
Sites
Encourage acquisition and
development of at least 2 lower
and 20 moderate units, for a
total of 22 units
Mar. 2026 - send
first notice
Mar. 2027 - send
second notice
Mar. 2028 -
evaluate progress
6th
Cycle
Not Yet
Started
The City will prioritize this
program after Q1, 2026,
starting with establishing
contact information and
preparing and sending
correspondence.

Units None

2.a.Housing
Rehabilitation
(Funding and
Assistance)
Encourage 2 low-income
rehabilitation units per year
from 2023-2031, with a specific,
geographic target for
2025 - 2031 -
monitor with APR
due 4/1
6th
Cycle
Continuou
s
The City intends to apply for
funding annually during
planning period and is
Units None
Resolution No.4333-26
February 4, 2026

Page 21 of 45 ends

propertities within Central and
West Taft
monitoring funding
opportunities regularly.

2.b.Housing
Rehabilitation
(Public
Information)
Housing information brochures
shall be updated regulary with
hard copies made available to
the public at City Hall and the
City website
2026 - 2031 -
monitor with APR
due 4/1
6th
Cycle
Continuou
s
The City Grants Administrator
publishes grant availability
information for Housing
Rehabilitation in hard copy
form as handouts at City Hall.

The Admin has also utilized the
City's website, Facebook, and
Twitter pages , as well as
advertising in the local
newspaper to distribute the
information.

Other None

2.c. Code
Enforcement
(Demolition)
Encourage more rehabilitation
and limit demolitions of
residential units to 2 per year
2027 - 2031 -
monitor with APR
due 4/1
6th
Cycle
Continuou
s
Ongoing limitation of
demolitions of residential units
to 2 per year. In 2025, only 1
demolition occurred.

Units None

2.d.Code
Enforcement
(Information
and
Monitoring)
Code enforcement updated
regularly with hard copies made
available to the public at City
Hall or the City website;
preserve at least 10 affordable
units
Mar. 2026 -
produce and post
handout
2026 - 2031 -
monitor with APR
due 4/1
6th
Cycle
Continuou
s
The City will prioritize this
program after Q1, 2026. Units None

3.a. First-Time
Home Buyer
Program
(Funding and
Assistance)
City will seek new funding to
keep the program activie and
assist at least 2 new
homeowners each year
2025 - 2031 -
monitor with APR
due 4/1
6th
Cycle
Continuou
s
The City intends to apply for
funding during planning period
and is monitoring funding
opportunities regularly.

Households None

3.b. First-
Time Home
Buyer
Program
(Education)
Facilitate 3 educational events
from 2023-2031
Establish
partnership by
Q1, 2026; hold
three (3) events
(2027, 2028,
2029)
6th
Cycle
Not Yet
Started
The City will prioritize this
program after Q1, 2026,
starting with establishing
contact information and
preparing and sending
correspondence.

Meetings None

3.c. Market
Rate Entry
Level Homes
(Pipeline
Project)
Encourage pipeline project to
build out 346 above-moderate
homes
Encourage build
out of the
remaining 348
homes by
December 2031
6th
Cycle
Continuou
s
City staff is regularly
monitoring status of the
pipeline project. As of Q1,
2026, no change.

Units None

4.a. Housing
Choice
Vouchers
Encourage participation in the
program and expand Housing
Choice Vouchers from 15 to 30
Mar. 2026 - post
resources
6th
Cycle
Continuou
s
The City will prioritize this
program after Q1, 2026. Other None
Resolution No.4333-26
February 4, 2026

Page 22 of 45 ends

2026 - 2031 -
monitor with APR

4.b. Rental
Assistance
(Education)
Facilitate 3 educational events
from 2023-2031 and encourage
preservation of at least 10
affordable units over the
planning period
Mar. 2026 -
establish
partnership
2027 - 2029 -
hold event (date
TBD)
6th
Cycle
Not Yet
Started
The City will prioritize this
program after Q1, 2026,
starting with establishing
contact information and
preparing and sending
correspondence.

Units None

4.c. Preserve
Affordable
Units
Preserve 60 affordable senior
housing units
2025 - 2031 -
monitor with APR
due 4/1
6th
Cycle
Continuou
s
City staff is regularly
monitoring status of the 60
affordable senior housing units.

As of Q1, 2026, no change.

Units None

5.a. Multi-
Family Rental
Housing
Remove constraints to multi-
family housing Dec. 2025 6th Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16 and Specific Plan
Amendment No. 2025-17.

Specific Plan Amendment No.
2025-17 approved through
Resolution No. 4325-25,
adopted by City Council on
12/16/2025. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.b. Housing
for
Agricultural
Employees
Remove constraints to
agricultural employee housing Dec. 2025 6th Cycle Completed Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.c.

Emergency
Shelters
Remove constraints to
emergency shelter Dec. 2025 6th Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.d. Low
Barrier
Navigation
Centers
Remove constraints to low
barrier navigation centers Dec. 2025 6th Cycle Completed Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
Resolution No.4333-26
February 4, 2026

Page 23 of 45 ends

approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.
ategoryid=107
39 5.e.

Transitional
Housing
Remove constraints to
transitional housing Dec. 2025 6th Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.f.

Supportive
Housing
Remove constraints to
supportive housing Dec. 2025 6th Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.g.Single-
Room
Occupancy
Units
Remove constraints to single-
room occupancy
Dec. 2025 6th
Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16 and Specific Plan
Amendment No. 2025-17.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.h.Manufactu
red Housing
Remove constraints to
manufactured homes Dec. 2025 6th Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16 and Specific Plan
Amendment No. 2025-17.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 Resolution No.4333-26
February 4, 2026

Page 24 of 45 ends

5.i. Mobile
Homes
Remove constraints to mobile
homes Dec. 2025 6th Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.j.Unit Size
Requirements Remove constraints to housing Dec. 2025 6th Cycle Completed Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.k.Setbacks Remove constraints to housing Dec. 2025 6th Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.l.Post-
Entitlement
Phase
Permits (AB
2234)
Increase transparency in
development application
processes
Dec. 2025 6th
Cycle Completed
The City created an AB 2234
webpage within the Planning
and Development Services
Department webpage.

Other
https://www.cit
yoftaft.org/pvie
w.aspx?id=535
5&catid=562

5.m.Definition
of Family Remove constraints to housing Dec. 2025 6th Cycle Completed Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.n.

Residential
Care Facilities
Remove constraints to housing Dec. 2025 6th
Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.o.

Reasonable
Accommodati
on
Remove constraints to housing Dec. 2025 6th
Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
Resolution No.4333-26
February 4, 2026

Page 25 of 45 ends

approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.
ategoryid=107
39 5.p. Water
and Sewer
Priority
Remove constraints to housing Dec. 2025 6th
Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.q.Objective
Findings Remove constraints to housing Dec. 2025 6th Cycle Completed Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 5.r.Public
Participation Remove constraints to housing March/September 2026-2031
6th
Cycle
Not Yet
Started
The City will prioritize this
program after Q1, 2026,
starting with establishing
contact information and
preparing and sending
correspondence.

Meetings None

6.a.Accessory
Dwelling Unit
Ordinance
Remove constraints to ADUs
Dec. 2024 -
submit ADU
ordinance to HCD
Dec. 2025 -
amend ordinance
6th
Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 6.b. ADU Pre-
Approved
Plans
Develop an ADU Pre-Approved
Plans program soliciting local
architects and engineers to
create simple pre-approved
plans of various footages for
new ADUs that are appropriate
for the City's varying lots
Mar. 2026 6th
Cycle
In
Progress
The City has contracted with
an engineering firm to
complete a set of pre-approved
ADU plans. The plans have
been drafted and are expected
to be finalized by March 2026,
pending plan check. Once
approved, the City will post on
its website.

Other
https://www.cit
yoftaft.org/files/
documents/Cit
yCouncilAgend
a06-18-
240331290613
24PM1710.pdf

6.c. Promote
and Monitor
ADU
Development
Promote development of at
least 5 ADUs per year for a
total of 30 ADUs, 21 for lower-
income, 6 for moderate income
Mar. 2026 - begin
promotion and
monitoring
Dec. 2028 - track
6th
Cycle
In
Progress
The City has drafted an ADU
guidebook and brochures to
promote the development of
ADUs. Once the pre-approved
plans are ready, the City will
Units
https://www.cit
yoftaft.org/files/
documents/Cit
yCouncilAgend
a06-18-
Resolution No.4333-26
February 4, 2026

Page 26 of 45 ends

and 3 for above moderate
income
progress, identify
actions
June 2029 -
implement actions
create an ADU webpage on its
website.
240331290613
24PM1710.pdf

7.a. Fair
Housing
(Assistance
and Support)
Maintain relationships with
regional fair housing services
and State and Federal district
offices
2025 - 2031;
monitor w/ APR
due 4/1
6th
Cycle
Continuou
s
The City continues to maintain
relationships with the regional
fair housing services and State
and Federal district offices.

Other None

7.b. Fair
Housing
(Information)
Maintain relationships with
regional fair housing services
and State and Federal district
offices and provide
informational materials to the
public. Ensure that ll new multi-
family construction meets
federal and state accessibility
requirements
2025 - 2031;
monitor w/ APR
due 4/1
6th
Cycle
Continuou
s
City Grants Administrator
maintains a list of referral
agencies that is utilized for any
fair housing complaints coming
into the City
Other None

8.a.Coordinati
on with
Agencies
Providing
Homeless
Services
Establish appropriate role
and/or level of service as
needed, organize joint meetings
with representatives of local
service providers
Mar. 2026 -
establish
partnership
2026 - 2027 -
hold meetings
(date TBD)
6th
Cycle
Not Yet
Started
The City will prioritize this
program after Q1, 2026,
starting with establishing
contact information and
preparing and sending
correspondence.

Meetings None

9.a. Multi-
Family
Housing
Project
Promote an expedited review
process and objective design
standards to encourage
development of a multi-family
projects in the Downtown Taft
Specific Plan, R-3 and MU
zoned propertieis for market
rate and affordable housing
developments
Mar. 2026 - initial
outreach;
quarterly
outreach, 2026 -
2031
6th
Cycle
Not Yet
Started
The City will prioritize this
program after Q1, 2026,
starting with establishing
contact information and
preparing and sending
correspondence.

Meetings None

9.b. In-Fill
Housing
Promote 2 homes per year to
be built on the in-fill lots listed
on the Adequate Sites list, and
allow homes to be built on
substandard lots that allow zero
lot line developments and
development on lots less than
50 feet wide without requiring a
variance
Dec. 2025 -
complete zoning
ordinance
amendment for lot
lines
2026 - 2031 -
promote annually;
monitor progress
through APR
6th
Cycle
In
Progress
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

One home was built on an infill
lot listed in the Adequate Sites
Units
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 Resolution No.4333-26
February 4, 2026

Page 27 of 45 ends

Inventory, identified as APN
031-160-04. The City will
continue to promote the
development of homes on infill
sites.

9.c.Self-Help
Housing
Work with Habitat for Humanity
to develop one new self-help
housing single-family dwelling
per year on an infill site
Mar. 2026 - initial
outreach;
quarterly
outreach, 2026 -
2031
6th
Cycle
In
Progress
In 2022, the City of Taft sold a
property to and issued a permit
for a new single-family
residential unit to Habitat for
Humanity as 233 Calvin Street.

Permits were issued in October
2022, with construction finally
underway in mid-2024 due to
utility issues. The new home
was completed in 2025.

Units None

9.d.Senior
Housing
Project
Complete construction of
another 50+ senior affordable
housing units
Mar. 2026 - initial
outreach;
quarterly
outreach, 2026 -
2031
6th
Cycle
Not Yet
Started
The City will prioritize this
program after Q1, 2026,
starting with establishing
contact information and
preparing and sending
correspondence.

Units None

9.e.Funding
for New Low-
Income
Housing
Development
s
Perform annual review of
funding sources and apply
annually, with the goal of at
least three successfully funded
applications. Assist at leaset 50
units during the 2023-2031
planning period
2025 - 2031 -
monitor with APR
due 4/1
6th
Cycle
Continuou
s
The City intends to apply for
funding during planning period
and is monitoring funding
opportunities regularly.

Units None

9.f.Infrastruct
ure
Assistance
Continue to monitor for new
revedopment agency
alternatives such as Community
Revitalization and Investment
Authority and Enhanced
Infrastructure Financing
Districts to establish funding
mechanisms for infrastructure
assistance
2025 - 2031 -
monitor with APR
due 4/1
6th
Cycle
Continuou
s
The City monitors
redevelopment agency
alternatives on a regular basis.

No feasible mechanism has
been identified as of Q1, 2026.

Other None

9.g.Developm
ental
Disabilities
Explore models to encourage
the construction and
rehabilitation of housing for
persons with developmental
Dec. 2025 -
zoning ordinance
amendment
Mar. 2026 - initial
6th
Cycle
In
Progress
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 Resolution No.4333-26
February 4, 2026

Page 28 of 45 ends

disabilities and implement a
partnership program
outreach
Sept. 2026 - first
quarterly meeting;
2026 - 2031
Mar. 2028 -
program launch
No. 856-26, adopted by City
Council on 1/20/2026.

The City will prioritize the
second part of this program
after Q1, 2026, starting with
establishing contact
information and preparing and
sending correspondence.

9.h.Preliminar
y Application
for
Development
(SB 330)
Expedite permit process for
eligible multi-family housing Dec. 2025 6th Cycle Completed The City created an SB 330
Informational Packet and
Application, and a staff policy
and procedure. The public-
facing document is available
on the Planning and
Development Services
Department website.

Other
https://www.cit
yoftaft.org/pvie
w.aspx?id=629
3&catid=562

9.i.Streamlini
ng Ministrial
Approval (SB
35)
Expedite permit process for
eligible multi-family housing Dec. 2025 6th Cycle Completed The City created an SB 423
Informational Packet and
Application, and a staff policy
and procedure. The public-
facing document is available
on the Planning and
Development Services
Department website.

Other
https://www.cit
yoftaft.org/pvie
w.aspx?id=629
3&catid=562

9.j. Lot Splits
and Small Lot
Residential
Development
(SB 9)
Remove constraints to housing Dec. 2025 6th
Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 9.k. Multi-
Family on
Commercially -Zoned
Property (AB
2011)
Expedite permit process for
eligible multi-family housing Dec. 2025 6th Cycle Completed Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 9.l. Density
Bonus
Provisions
and
Incentivize housing
development Dec. 2025 6th Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 Resolution No.4333-26
February 4, 2026

Page 29 of 45 ends

Development
Incentives
No. 856-26, adopted by City
Council on 1/20/2026.

9.m. Lower-
income
Opportunity
Sites
Encourage development of
affordable housing Dec. 2025 6th Cycle Completed
Implemented through Zoning
Ordinance Amendment No.
2025-16. Zoning Ordinance
Amendment No. 2025-16
approved through Ordinance
No. 856-26, adopted by City
Council on 1/20/2026.

Other
https://www.cit
yoftaft.org/age
ndalist.aspx?c
ategoryid=107
39 9.n.

Consistency
with General
Plan
Compliance with Government
Code 65300.5
2025 - 2031;
monitor with APR
due 4/1
6th
Cycle
Continuou
s
An evaluation of the General
Plan was completed for the
2025 APR. The City will
continue to monitor each year.

Other None

9.o.

Farmworker
Housing
Encourage development of
farmworker housing
Mar. 2026 - initial
outreach
Mar. 2027 -
complete
feasibility study
Sept. 2027 -
implement
feasible
measures
6th
Cycle
Not Yet
Started
The City will prioritize this
program after Q1, 2026,
starting with establishing
contact information and
preparing and sending
correspondence.

Other None

10.a. Central
Taft
Revitalization
Place-based strategies for
community revitalization
1–2 initiatives
every other year
starting 2027
6th
Cycle
Not Yet
Started This is a 2027 program. Other None

10.b. West
Taft
Revitalization
Place-based strategies for
community revitalization
1-2 initiatives
every other year
starting 2027
6th
Cycle
Not Yet
Started This is a 2027 program. Other None
Resolution No.4333-26
February 4, 2026

Page 30 of 45 ends

8. Table E
Jurisdiction Taft ANNUAL ELEMENT PROGRESS REPORT
Reporting
Period 2025
(Jan. 1 - Dec.
31) Housing Element Implementation
Planning 6th Cycle 12/31/2023 - 12/31/2031
Description of
Commercial
Development Bonus
Commercial Development Bonus
Date Approved
3 4
APN Street
Address Project Name+
Local
Jurisdiction
Tracking ID+
Very Low
Income
Low
Income
Moderate
Income
Above Moderate
Income
Description of
Commercial
Development Bonus
Commercial Development Bonus
Date Approved
Summary Row: Start Data Entry Below
Units Constructed as Part of Agreement
Commercial Development Bonus Approved pursuant to GC Section 65915.7 Table E
Note: "+" indicates an optional field
Project Identifier
1 2
Cells in grey contain auto-calculation
formulas
(CCR Title 25 §6202)
Resolution No.4333-26
February 4, 2026

Page 31 of 45 ends

9. Table F
Jurisdiction Taft ANNUAL ELEMENT PROGRESS REPORT Note: "+" indicates an optional field Reporting Period 2025
(Jan. 1 - Dec.
31) Housing Element Implementation Cells in grey contain auto-calculation formulas Planning Period 6th Cycle 12/31/2023 - 12/31/2031
The description should adequately
document how each unit complies with
subsection (c) of Government Code
Section 65583.1+
.

For detailed reporting requirements, see
the chcklist here:

Extremely
Low-Income+
Very LowIncome+ Low-Income+
TOTAL
UNITS+
Extremely LowIncome+Very LowIncome+ Low-Income+TOTAL
UNITS+
https://www.hcd.ca.gov/communitydevelopment/docs/adequate-sites-checklist.pdf Rehabilitation Activity
Preservation of Units At-Risk
Acquisition of Units
Mobilehome Park
Preservation
Total Units by Income
Table F
Please note this table is optional: The jurisdiction can use this table to report units that have been substantially rehabilitated, converted from non-affordable to affordable by acquisition, and preserved, including mobilehome park preservation, consistent with the standards set forth in Government Code section 65583.1, subdivision (c). Please note, motel, hotel, hostel rooms or other structures that are converted from non-residential to residential units pursuant to Government Code section 65583.1(c)(1)(D) are considered net-new housing units and must be reported in Table A2 and not reported in Table F.

Activity Type
Units that Do Not Count Towards RHNA+
Listed for Informational Purposes Only
Units that Count Towards RHNA +
Note - Because the statutory requirements severely limit what can be counted, please contact HCD at
[email protected] and we will unlock the form which enable you to populate these fields.

Units Rehabilitated, Preserved and Acquired for Alternative Adequate Sites pursuant to Government Code section 65583.1(c) Resolution No.4333-26
February 4, 2026

Page 32 of 45 ends

10. Table F2
Jurisdiction Taft ANNUAL ELEMENT PROGRESS REPORT
Note: "+" indicates an
optional field
Reporting
Period 2025 (Jan. 1 - Dec. 31) Housing Element Implementation Cells in grey contain auto-calculation formulas Planning
Period 6th Cycle 12/31/2023 - 12/31/2031
Notes
2 3 6
Prior APN+ Current APN Street Address Project
Name+
Local
Jurisdiction
Tracking ID
Unit
Category
(2 to 4,5+)
Tenure
R=Renter
Very LowIncome
Deed
Restricted
Very LowIncome
Non Deed
Restricted
Low- Income Deed
Restricted
Low- Income
Non Deed
Restricted
ModerateIncome Deed
Restricted
ModerateIncome Non
Deed
Restricted
Above
ModerateIncome
Total Moderate Income
Units Converted from
Above Moderate
Date
Converted Notes
Summary Row: Start Data Entry Below 0 0 0 0 0 0 0 0
Table F2
Above Moderate Income Units Converted to Moderate Income Pursuant to Government Code section 65400.2 For up to 25 percent of a jurisdiction’s moderate-income regional housing need allocation, the planning agency may include the number of units in an existing multifamily building that were converted to deed-restricted rental housing for moderate-income households by the imposition of affordability covenants and restrictions for the unit. Before adding information to this table, please ensure housing developments meet the requirements described in Government Code 65400.2(b). 5 Project Identifier Unit Types
1 4
Affordability by Household Incomes After Conversion Units credited toward Moderate Income RHNA
Resolution No.4333-26
February 4, 2026

Page 33 of 45 ends

11. Table G
Jurisdiction Taft
Reporting
Period 2025
(Jan. 1 - Dec.
31) g
Period 6th Cycle 12/31/2023 - 12/31/2031 ANNUAL ELEMENT PROGRESS REPORT Housing Element Implementation
2 3 4
APN Street
Address Project Name+
Local
Jurisdiction
Tracking ID+
Realistic
Capacity
Identified in
the Housing
Element
Entity to whom the
site transferred Intended Use for Site
1 Summary Row: Start Data Entry Below
Note: "+" indicates an optional field
Cells in grey contain auto-calculation
formulas
Table G
Locally Owned Lands Included in the Housing Element Sites Inventory that have been sold, leased, or otherwise disposed of Project Identifier
NOTE: This table must only be filled out if the
housing element sites inventory contains a site
which is or was owned by the reporting jurisdiction,
and has been sold, leased, or otherwise disposed of
Resolution No.4333-26
February 4, 2026

Page 34 of 45 ends

12. Table H
Jurisdiction Taft NOTE: This table must contain an inventory of ALL surplus/excess lands the reporting
jurisdiction owns
Note: "+" indicates an
optional field
Reporting Period 2025
(Jan. 1 -
Dec. 31)
Cells in grey contain autocalculation formulas

ANNUAL ELEMENT PROGRESS REPORT
Housing Element Implementation
Table H
Locally Owned Surplus Sites
Parcel Identifier Designation Size Notes
1 2 3 4 5 6 7
APN Street
Address/Intersection
Existing
Use
Number of
Units Surplus Designation
Parcel
Size (in
acres)
Notes
Summary Row: Start Data Entry Below
031-020-07-00-3 N/A (309 Cener St) Other 0 Exempt Surplus Land 0.07 Public parking lot 031-020-08-00-6 N/A (305-307 Center St) Other 0 Exempt Surplus Land 0.14 Public parking lot 031-020-09-00-9 301 Center St. Other 0 Exempt Surplus Land 0.14 Public parking lot 031-020-10-00-1 300 Main St. Vacant 0 Surplus Land 0.28 031-020-18-00-5 312 Main St. Vacant 0 Surplus Land 0.07 031-020-19-00-8 308 Main St. Vacant 0 Surplus Land 0.14 031-040-13-00-6 N/A (400 Main St) Other 0 Exempt Surplus Land 0.28 Public parking lot 031-040-14-00-9 N/A Other 0 Exempt Surplus Land 0.07 Public parking lot 031-040-17-00-8 420 Main St. Vacant 0 Surplus Land 0.36 Resolution No.4333-26
February 4, 2026

Page 35 of 45 ends

031-050-14-00-2 412 Center St Public
Facilities 0 Exempt Surplus Land 0.07 Park
031-050-23-00-8 N/A Public
Facilities 0 Exempt Surplus Land 0.07 Park
031-050-24-00-1 N/A Other 0 Exempt Surplus Land 0.5 Public parking lot 031-060-08-00-8 N/A Other 0 Exempt Surplus Land 0.5 Public parking lot 031-060-10-00-3 528 Main St. Vacant 0 Surplus Land 0.21 031-060-11-00-6 532 Main St. Vacant 0 Surplus Land 0.14 031-080-07-00-1 505 Kern St. Other 0 Exempt Surplus Land 0.14 Public parking lot 031-080-08-00-4 501 Kern St. Other 0 Exempt Surplus Land 0.14 Public parking lot 031-080-09-00-7 500 North St. Other 0 Exempt Surplus Land 0.21 Public parking lot 031-080-11-00-2 512 North St. Vacant 0 Exempt Surplus Land 0.14 031-080-12-00-5 520 North St. Vacant 0 Exempt Surplus Land 0.28 031-080-13-00-8 N/A Other 0 Exempt Surplus Land 0.14 Public parking lot 031-080-16-00-7 N/A Other 0 Exempt Surplus Land 0.14 Public parking lot 031-090-14-00-4 418 North St. Vacant 0 Surplus Land 0.07 031-160-03-00-2 416 6th St. Vacant 0 Surplus Land 0.07
031-190-16-00-9 624 Center St. Other 0 Exempt Surplus Land 0.21 Public parking lot 031-190-17-00-2 630 Center St. Other 0 Exempt Surplus Land 0.14 Public parking lot 031-260-07-00-3 613 San Emidio St. Vacant 0 Surplus Land 0.14 031-280-19-00-4 418 Lucard St. Vacant 0 Surplus Land 0.07 031-310-24-00-6 230 San Emidio St. Vacant 0 Surplus Land 0.07 031-320-23-00-6 324 1/2 San Emidio St. Vacant 0 Surplus Land 0.07 031-430-03-00-0 155 Center St. Vacant 0 Surplus Land 0.11 032-040-12-00-0 N/A (801 Center St) Public
Facilities 0 Exempt Surplus Land 0.8 Fire Station used by Federal BLM 032-060-10-00-0 N/A Public
Facilities 0 Exempt Surplus Land 0.34 Public Street - Hellman Drive 032-060-11-00-3 N/A (209 E Kern St) Public
Facilities 0 Exempt Surplus Land 2.93 Taft City Hall - Veterans Park 032-111-01-00-5 815 Main St. Commercial 0 Surplus Land 2.63 Approx 1.8ac vacant Resolution No.4333
-26
February 4, 2026

Page 36 of 45 ends

032-111-02-00-8 N/A (between 6th & 10th
Streets)
Public
Facilities
0 Exempt Surplus Land 2.68 Class ! Trail
- Former Rail
Line
032-111-03-00-1 N/A (Supply Row between
6th & 10th Streets) Vacant
0 Surplus Land 1.38
032-111-04-00-4 N/A (between 6th & 10th
Streets) Vacant
0 Exempt Surplus Land 0.1 Class ! Trail
- Former Rail
Line
032-111-05-00-7 N/A (Supply Row between
6th & 10th Streets) Vacant
0 Surplus Land 2.66
032-112-01-00-2 N/A (531 Main St) Public
Facilities
0 Exempt Surplus Land 0.46 Public Park - Event Area
032-112-02-00-5 N/A Public
Facilities
0 Exempt Surplus Land 0.03 Public Park - Event Area
032-112-05-00-4 N/A (401 Main St) Vacant0 Surplus Land 0.46 032-112-06-00-7 N/A (529 Main St) Public
Facilities
0 Exempt Surplus Land 0.43 Public Park - Event Area
032-112-07-00-0 N/A Public
Facilities
0 Exempt Surplus Land 0.06 Public Park - Event Area
032-112-10-00-8 119 S 4th St. Vacant0 Surplus Land 0.91 032-112-11-00-1 N/A (between 4th & 6th
Streets)
Public
Facilities
0 Exempt Surplus Land 0.99 Class ! Trail
- Former Rail
Line
032-112-12-00-4 N/A (between 4th & 6th
Streets)
Public
Facilities
0 Exempt Surplus Land 0.07 Class ! Trail
- Former Rail
Line
032-112-13-00-7 N/A (550 Supply Row) Public
Facilities
0 Exempt Surplus Land 1.83 Taft Transit Center
032-112-14-00-0 N/A (between 4th & 6th
Streets)
Public
Facilities
0 Exempt Surplus Land 0.92 Class ! Trail
- Former Rail
Line
032-112-15-00-3 550 Supply Row Public
Facilities
0 Exempt Surplus Land 1.15 Taft Transit Center
032-113-01-00-9 N/A (331 Main St) Vacant0 Surplus Land 0.1 032-113-03-00-5 N/A (201 Main St) Vacant0 Surplus Land 0.34 032-113-04-00-8 N/A (203 Main St) Vacant0 Surplus Land 0.68 032-113-07-00-7 N/A (329 Main St) Vacant0 Surplus Land 0.19 032-113-08-00-0 N/A (between 2nd & 4th
Streets)
Public
Facilities
0 Exempt Surplus Land 1.97 Class ! Trail
- Former Rail
Line
Resolution No.4333
-26
February 4, 2026

Page 37 of 45 ends

032-113-09-00-3 N/A (300 Supply Row) Vacant0 Surplus Land 0.64 032-113-10-00-5 N/A (302 Supply Row) Vacant0 Surplus Land 1.3 032-115-05-00-5 N/A (130 Supply Row) Vacant0 Surplus Land 4.98 Not recommended for
residential development
due to soil contamination
032-116-01-00-0 N/A (131 Supply Row) Vacant0 Surplus Land 0.97 032-117-01-00-7 N/A (201 Supply Row) Vacant0 Surplus Land 1.16 032-117-02-00-0 N/A (301 Supply Row) Vacant0 Surplus Land 4.64 032-118-01-00-4 N/A (401 Supply Row) Vacant0 Surplus Land 6.71 032-152-04-00-3 N/A (west of Hillard St) Public
Facilities
0 Exempt Surplus Land 6.39 Class ! Trail
- Former Rail
Line
032-152-48-00-1 N/A (between Hillard St &
Church St)
Public
Facilities
0 Exempt Surplus Land 2.71 Class ! Trail
- Former Rail
Line
032-220-32-00-0 N/A (Airport Rd) Public
Facilities
0 Exempt Surplus Land 1.72
Farmland accepting
wastewater treatment
plant liquids
032-220-33-00-3 N/A (Airport Rd) Public
Facilities Exempt Surplus Land 1.62
Farmland accepting
wastewater treatment
plant liquids
032-220-34-00-6 N/A (Airport Rd) Public
Facilities
0 Exempt Surplus Land 14.06
Flood Zone - Farmland
accepting wastewater
treatment plant liquids
032-220-57-00-3 N/A (E Ash St) Public
Facilities
0 Exempt Surplus Land 70.85
Farmland accepting
wastewater treatment
plant liquids
032-220-58-00-6 N/A (Airport Rd) Public
Facilities
0 Exempt Surplus Land 17.59
Flood Zone - Farmland
accepting wastewater
treatment plant liquids
032-220-60-00-1 N/A (Airport Rd) Vacant0 Surplus Land 9.49 Flood Zone 032-220-63-00-0 N/A (Airport Rd) Vacant0 Surplus Land 8.71 Flood Zone 032-220-65-00-6 N/A (SEC Airport Rd & E
Ash St)
Public
Facilities
0 Exempt Surplus Land 27.53
Farmland accepting
wastewater treatment
plant liquids
Resolution No.4333
-26
February 4, 2026

Page 38 of 45 ends

032-220-66-00-9 N/A (Airport Rd) Public
Facilities
0 Exempt Surplus Land 65.28
Farmland accepting
wastewater treatment
plant liquids
032-291-06-00-3 308 Church St. Vacant0 Surplus Land 0.17 039-410-17-00-1 N/A (between City boundary
& Hwy 33)
Public
Facilities
0 Exempt Surplus Land 4.19 Class ! Trail
- Former Rail
Line
198-040-33-00-0 N/A Vacant0 Surplus Land0
Former segment of
abandoned rail line in
unincorporated Kern
County, no acreage listed
on records
198-140-19-00-9 N/A Vacant0 Surplus Land 16.55
Former segment of
abandoned rail line in
unincorporated Kern
County
198-180-59-00-7 N/A Vacant0 Surplus Land 1.53
Former segment of
abandoned rail line in
unincorporated Kern
County
198-300-37-00-7 N/A Vacant0 Surplus Land 1.15
Former segment of
abandoned rail line within
city limints
198-300-63-00-2 N/A Vacant0 Surplus Land 6.54
Former segment of
abandoned rail line in
unincorporated Kern
County
220-042-03-00-9 N/A Public
Facilities
0 Exempt Surplus Land1 Community Correctional
Facility
220-042-05-00-5 N/A Vacant0 Surplus Land 9.57
Former segment of
abandoned rail line within
city limints
220-042-10-00-9 N/A Vacant0 Surplus Land 15.89
Former segment of
abandoned rail line within
city limints
Resolution No.4333
-26
February 4, 2026

Page 39 of 45 ends

220-050-57-00-5 899 Duval Rd. Public
Facilities
0 Exempt Surplus Land 67.61
Wastewater Treatment
Plant for federal
correctional facility
220-050-59-00-1 N/A Public
Facilities
0 Exempt Surplus Land 0.36
Wastewater Treatment
Plant for federal
correctional facility
220-060-08-00-6 N/A Public
Facilities
0 Exempt Surplus Land 0.89
Wastewater Treatment
Plant for federal
correctional facility
220-240-08-00-8 N/A (1120 E Ash St) Public
Facilities
0 Exempt Surplus Land 37 Wastewater Treatment
Plant
220-240-10-00-3 N/A (1120 E Ash St) Public
Facilities
0 Exempt Surplus Land 5.22 Wastewater Treatment
Plant
220-240-25-00-7 Gas Company Rd. Public
Facilities
0 Exempt Surplus Land 0.59 Wastewater Treatment
Plant
220-280-15-00-0 N/A (320 Commerce Way) Public
Facilities
0 Exempt Surplus Land1 Taft Police Station
220-280-16-00-3 330 Commerce Way Public
Facilities
0 Exempt Surplus Land 3.99 Community Correctional
Facility
220-290-07-00-0 N/A (Enterprise Way) Vacant0 Surplus Land 3.18 220-290-10-00-8 N/A (NEC Petroleum Club
Rd & Hwy 33) Vacant
0 Surplus Land 1.2
Resolution No.4333-26
February 4, 2026

Page 40 of 45 ends

13. Table J

14. Table K
Jurisdiction Taft ANNUAL ELEMENT PROGRESS REPORT
Reporting
Period 2025
(Jan. 1 - Dec.
31) Housing Element Implementation
Planning
Period 6th Cycle 12/31/2023 - 12/31/2031
Project Type Date
Units
(Beds/Student
Capacity)
Notes
2 3 5 6
APN Street
Address Project Name+
Local
Jurisdiction
Tracking ID+
Unit Category
(SH - Student
Housing)
Date
Very LowIncome Deed
Restricted
Very LowIncome Non
Deed
Restricted
Low- Income
Deed
Restricted
Low- Income
Non Deed
Restricted
ModerateIncome Deed
Restricted
ModerateIncome Non
Deed
Restricted
Above
ModerateIncome
Total Additional
Beds Created Due
to Density Bonus
Notes
Summary Row: Start Data Entry Below
Note: "+" indicates an optional field
Cells in grey contain auto-calculation formulas
Table J
Student housing development for lower income students for which was granted a density bonus pursuant to subparagraph (F) of paragraph (1) of subdivision (b) of Section 65915 Project Identifier Units (Beds/Student Capacity) Approved 1 4
NOTE: STUDENT HOUSING WITH DENSITY
BONUS ONLY. This table only needs to be
completed if there were student housing projects
WITH a density bonus approved pursuant to
Government Code65915(b)(1)(F)
Jurisdiction Taft ANNUAL ELEMENT PROGRESS REPORT
Reporting Period 2025 (Jan. 1 - Dec. 31)
Planning Period 6th Cycle 12/31/2023 - 12/31/2031
No
Table K
Tenant Preference Policy
Local governments are required to inform HCD about any local tenant preference ordinance the local government maintains when the jurisdiction submits their annual progress report on housing approvals and production, per Government Code 7061 (SB 649, 2022, Cortese). Effective January 1, 2023, local governments adopting a tenant preference are required to create a webpage on their internet website containing authorizing local ordinance and supporting materials, no more than 90 days after the ordinance becomes operational.

Does the Jurisdiction have a local tenant preference
policy?
If the jurisdiction has a local tenant preference policy, provide a link to the jurisdiction's webpage containing authorizing local ordinance and supporting materials.

Notes
Resolution No.4333-26
February 4, 2026

Page 41 of 45 ends

15. Table L
Jurisdiction Taft Note: "+" indicates an optional field Reporting
Period 2025
(Jan. 1 - Dec.
31)
Cells in grey contain auto-calculation
formulas
Size Notes
3 4
APN Street Address/Intersection Date of
Designation
Designation
Level
Historic Site
Period
Areas of
Significance
Parcel Size (in
acres) Notes
Summary Row:

NOTE: This table needs to be completed with any sites
within your jurisdiction that were newly added to a National, State, or Local register of historic places within the reporting year. If none, leave blank.

ANNUAL ELEMENT PROGRESS REPORT
Housing Element Implementation
Table L
Historical Resources
Parcel Identifier
1 Designation
2 Resolution No.4333-26
February 4, 2026

Page 42 of 45 ends

16. LEAP Reporting
Summary of entitlements, building permits, and certificates of occupancy (auto-populated from Table A2) Completed Entitlement Issued by Affordability Summary
Income Level Current Year
Acutely
Low
Deed Restricted 0
Non-Deed Restricted 0
Extremely
Low
Deed Restricted 0
Non-Deed Restricted 0
Very Low Deed Restricted 0
Non-Deed Restricted 0
Low Deed Restricted 0
Non-Deed Restricted 0
Moderate Deed Restricted 0
Non-Deed Restricted 0
Jurisdiction Taft
Reporting Year 2025 (Jan. 1 - Dec. 31)
Total Award Amount Total award amount is auto-populated based on amounts entered in rows 15-26.

Task $ Amount Awarded $ Cumulative Reimbursement Requested Other Funding Notes

ANNUAL ELEMENT PROGRESS REPORT
Local Early Action Planning (LEAP) Reporting
(CCR Title 25 §6202)
Please update the status of the proposed uses listed in the entity’s application for funding and the corresponding impact on housing within the region or jurisdiction, as applicable, categorized based on the eligible uses specified in Section 50515.02 or 50515.03, as applicable.
$ -
Task Status
Resolution No.4333-26
February 4, 2026

Page 43 of 45 ends

Above
Moderate 0
Total Units 0
Building Permits Issued by Affordability Summary
Income Level Current Year
Acutely
Low
Deed Restricted 0
Non-Deed Restricted 0
Extremely
Low
Deed Restricted 0
Non-Deed Restricted 0
Very Low Deed Restricted 0
Non-Deed Restricted 0
Low Deed Restricted 0
Non-Deed Restricted 2
Moderate Deed Restricted 0
Non-Deed Restricted 2
Above
Moderate 0
Total Units 4
Certificate of Occupancy Issued by Affordability Summary Income Level Current Year
Acutely
Low
Deed Restricted 0
Non-Deed Restricted 0
Extremely
Low
Deed Restricted 0
Non-Deed Restricted 0
Very Low Deed Restricted 0
Non-Deed Restricted 0
Resolution No.4333-26
February 4, 2026

Page 44 of 45 ends

Low Deed Restricted
0 Non-Deed Restricted
0 Moderate Deed Restricted
0 Non-Deed Restricted
1 Above
Moderate 0
Total Units
1 Resolution No.4333-26
February 4, 2026

Page 45 of 45 ends

PASSED, APPROVED, AND ADOPTED this 3rd day of March 2026 ________________________________
Dave Noerr, Mayor
ATTEST:

Faith Melton
City Clerk
STATE OF CALIFORNIA }
COUNTY OF KERN } SS
CITY OF TAFT }
I, Faith Melton, City Clerk of the City of Taft, do hereby certify that the foregoing Resolution was duly and regularly adopted by the City Council of the City of Taft at a regular meeting thereof held on the 3rd day of March 2026, by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ABSTAIN: Councilmembers:

Faith Melton
City Clerk

TAFT CITY COUNCIL/SUCCESSOR AGENCY

MINUTES
FEBRUARY 17, 2026
The February 17, 2026 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 Council Member Waldrop and invocation was given by Greg Mudge.

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

1. STUDY SESSION – PRESENTATION BY RICHARD CHAPMANN WITH KERN ECONOMIC DEVELOPMENT CORPORATION AND BARRY FOSTER WITH ECONSOLUTIONS.

2. CITIZEN REQUESTS/PUBLIC COMMENTS
There was none.

3. COUNCIL STATEMENTS (NON-ACTION)
Council Member Krier reminded all that Taft is open for business and that we are blessed to have a community like Taft.

Council Member Waldrop urged the community to stay safe in the wind.

Council Member Chavira congratulated the Taft High boys’ soccer team, told the community to get involved with the West Kern Economic Alliance and to be safe in this weather.

Mayor Noerr said those presentations by Richard Chapmann and Barry Foster were great and explained some new DMV regulations that will be happening this year.

4. PLANNING COMMISSION REPORT
Planning Commissioner John Dowden recommended that the Council approve an upcoming Annual Progress Report for the Housing Element.

5. DEPARTMENT REPORTS
There was none.

6. CITY MANAGER STATEMENTS
City Manager Jones thanked Barry Foster and Richard Chapmann for their presentations, he stated the traffic in our area is up as well as building applications and various permits.

City of Taft Council/Successor Agency Meeting
Minutes
February 17, 2026

Page 2 of 3 ends

7. CITY ATTORNEY STATEMENTS
There was none.

8. FUTURE AGENDA REQUESTS
There was none.
********************************************************************************************* CONSENT CALENDAR ITEMS 9-11
Motion: Moved by Krier seconded by Chavira to approve consent calendar items 9-11.

AYES: Krier, Chavira, Waldrop, Noerr

9. MINUTES
February 03, 2026 Regular
Recommendation – Approve as submitted.

10. PAYMENT OF BILLS
Warrant # 013026 Check No. 201497-201555 $ 462,606.93
Warrant # 021326 Check No. 201556-201618 $ 281,780.01
Recommendation – Approve payment of the bills.

11. MONTHLY REPORT FOR KERN COUNTY FIRE STATION NO. 21 – DECEMBER 2025 Recommendation –
Receive and file the monthly report for December 2025 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. ******************************************************************************************** At 7:14 PM the regular meeting was recessed to closed session.

CLOSED SESSION
A. CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATION Government Code Section 54956.9(b) – Two (2) undisclosed cases B. CONFERENCE WITH REAL PROPERTY NEGOTIATOR, CRAIG JONES- CITY MANAGER Government Code Section 54956.8 – (1) undisclosed parcel C. CONFERENCE WITH LABOR NEGOTIATOR, CRAIG JONES, CITY MANAGER Government Code 54957.6 – All units
City of Taft Council/Successor Agency Meeting
Minutes
February 17, 2026

Page 3 of 3 ends

 The City Council discussed in closed session the items agendized for closed session discussion and directions were given to staff and negotiators. The City Council took no other reportable action.

ADJOURNMENT - With no further business to conduct, the meeting was adjourned at 7:51 PM. __________ ____________
Faith Melton Dave Noerr
City Clerk Mayor

REVIEWED BY:

CITY CLERK FINANCE DIRECTOR CITY MANAGER
City of Taft Agenda Report
DATE: March 03, 2026
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:

CANCELLATION OF JULY 7, 2026 CITY COUNCIL MEETING
SUMMARY STATEMENT:

The regularly scheduled meeting for City Council on July 7, 2026, falls near a holiday and during a time many families’ vacation. Cancelling this meeting will not delay any Council decisions, as all items scheduled for consideration will be placed on upcoming regular agendas or, if necessary, addressed at a specially called meeting to ensure timely action on urgent matters.

RECOMMENDED ACTION
Motion to approve the cancellation of the July 07, 2026 City Council Meeting.

IMPACT ON BUDGET (Y/N): No
ATTACHMENT (Y/N): No
PREPARED BY: Office of the City Clerk
REVIEWED BY:

CITY CLERK FINANCE DIRECTOR CITY MANAGER
City of Taft Agenda Report
DATE: MARCH 3, 2026
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:

UPDATE TO THE ADMINISTRATIVE POLICIES AND PROCEDURES TO APPROVE AND ADOPT SOCIAL MEDIA POLICY SECTION 129
SUMMARY STATEMENT:

This policy is written to establish guidelines and clear rules and regulations regarding the City of Taft social media accounts. Social media accounts will be used to disseminate factual information, promote transparency to the community and to remain compliant with all public record act laws.

RECOMMENDED ACTION
Motion to approve and adopt Social Media Policy Section 129 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, Draft Policy
PREPARED BY: City Clerk
POLICIES AND PROCEDURES MANUAL: ADMINISTRATIVE
Subject: SOCIAL MEDIA
Effective Date:

Reference: Council Motion
SECTION 129

Page 1 of 4 ends

I. Purpose
To establish guidelines for the creation, management, and use of official City of Taft social media accounts.

To ensure that social media platforms are used to disseminate information effectively, engage with the community, and enhance transparency through posts, photos, graphics, videos, etc.

To protect the City's reputation and ensure compliance with all applicable laws, regulations, and policies, including public records laws and First Amendment rights.

To define acceptable use, content standards, and moderation practices for City social media.

II. Responsibilities
Any City department wishing to establish an official social media account must obtain approval from the City Manager or their designee.

A written request outlining the purpose, goals, target audience, and proposed content strategy for the account must be submitted for review.

The City's designated department will oversee the creation of the basic account structure to ensure consistent branding and adherence to this policy.

Official City contact information (e.g., a dedicated City email address) must be used for account setup and management. Personal email addresses are prohibited for this purpose.

Whenever possible, official City social media accounts should clearly indicate that they are maintained by the City of Taft and link back to the official City website (www.cityoftaft.ca.gov).

III. Appropriate Uses
All content posted on official City social media accounts must be accurate, factual, and relevant to City business, services, events, and community POLICIES AND PROCEDURES MANUAL: ADMINISTRATIVE
Subject: SOCIAL MEDIA
Effective Date:

Reference: Council Motion
SECTION 129

Page 2 of 4 ends

information.

All information posted to social media sites will be unclassified. No FOUO (for official use only), classified, pre-decisional, proprietary or business-sensitive information should ever be posted or discussed on this page.

Employees posting content must adhere to professional standards of conduct and represent the City in a positive and respectful manner.

Personal opinions or endorsements of political candidates, campaigns, or commercial products are prohibited on official City social media accounts.

Content should be accessible to all users, including those with disabilities, by using clear language, providing captions for images and videos, and adhering to accessibility guidelines.

The City reserves the right to determine the appropriateness of content and may remove or edit posts that violate this policy.

Whenever referencing external websites or sources, links should be provided to the official source whenever possible.

IV. Prohibited uses
The following types of content are strictly prohibited on official City social media accounts and will be removed:
• Profane, obscene, or offensive language or content.
• Content that promotes, fosters, or perpetuates discrimination based on race, color, religion, sex, national origin, age, disability, sexual orientation, or any other protected characteristic.
• Harassment, bullying, or personal attacks.
• Confidential or sensitive information, including personal information of employees or residents (unless explicitly authorized and necessary). • Content that violates any federal, state, or local law, including copyright or trademark infringement.
• Solicitations of commerce, advertisements, or endorsements of private businesses (unless part of a City-sponsored event).

POLICIES AND PROCEDURES MANUAL: ADMINISTRATIVE
Subject: SOCIAL MEDIA
Effective Date:

Reference: Council Motion
SECTION 129

Page 3 of 4 ends

• Political campaign materials or endorsements of political candidates or ballot measures.
• Information that may compromise public safety or security. • Comments that are not topically related to the specific post. • Misinformation or disinformation.

V. Moderation – Pages will not be monitored 24/7
Official City social media accounts will be regularly monitored for comments and activity by designated City employees (Moderators).

The City reserves the right to remove comments that violate the Prohibited Content guidelines outlined in Section IV.

While the City encourages open communication, it is not obligated to respond to all comments. Responses will generally be limited to providing factual information or directing inquiries to the appropriate City department.

City employees engaging in responses should maintain a professional and neutral tone and avoid debates or arguments.

Users (general public) who repeatedly violate this policy may be blocked from official City social media accounts.

All removed comments and any actions taken (e.g., blocking a user) should be documented, including the date, time, content of the comment, and reason for removal.

VI. Legalities
All use of official City social media accounts must comply with federal, state, and local laws, including public records laws. Content posted on these accounts may be subject to public disclosure.

The City's social media activities must also adhere to First Amendment principles, ensuring freedom of speech while also allowing the City to maintain a civil and productive online environment.

Employees responsible for managing social media accounts should be aware of POLICIES AND PROCEDURES MANUAL: ADMINISTRATIVE
Subject: SOCIAL MEDIA
Effective Date:

Reference: Council Motion
SECTION 129

Page 4 of 4 ends

legal issues related to copyright, defamation, privacy and California Public Records Act. The City Clerks Office will provide guidance on Public record matters pertaining to social media if needed by other employees.

REVIEWED BY:

CITY CLERK FINANCE DIRECTOR CITY MANAGER
City of Taft Agenda Report
DATE: MARCH 3, 2026
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:

CITY INVESTMENT POLICY ANNUAL REVIEW
SUMMARY STATEMENT:

California Government Code Section 53646(a)(2) requires local government to review and consider changes to its Statement of Investment Policy annually at a public meeting.

On February 26, 2026, the Taft City Finance Committee reviewed its Statement of Investment Policy to comply with the Government Code Section 53646(a)(2). No changes were requested.

Attached are the City’s current Statement of Investment Policy and Broker/Dealer Questionnaire and Certification.

RECOMMENDED ACTION:

Motion to concur with the Finance Committee’s recommendation to adopt the policy with no changes 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, Investment Policy and Broker/Dealer Questionnaire and Certification.

PREPARED BY: Teresa Binkley, Finance Director
POLICIES AND PROCEDURES MANUAL: ADMINISTRATIVE
Subject: STATEMENT OF INVESTMENT POLICY
Effective Date: 03/03/2026
Reference: Council Motion; 10/20/2015, 10/18/16, 11/06/18, 12/15/20, 12/07/21, 03/03/26 SECTION 207

Page 1 of 6 ends

INTRODUCTION
The purpose of this document is to identify various policies and procedures that enhance opportunities for the prudent and systematic investment of public money and to formalize the City’s investment-related activities.

Such activities, which collectively constitute a comprehensive cash management program, include revenue collection, disbursements control, cost effective banking relations and a short-term borrowing program which coordinates working capital requirements and investment opportunity acting in concert with the many facets of an appropriate and secure short-term investment program.

SCOPE
It is intended that this policy cover all funds and investment activities of the General Fund, Special Revenue Funds, Capital Projects Funds, Enterprise Funds, and Fiduciary Funds of the City of Taft and the Taft Community Development Agency. Funds held in a City-approved deferred compensation plan and in employee pension plans are not governed by this policy.

PRUDENCE
Investments shall be made with judgment and care—under circumstances then prevailing— which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived.

The standard of prudence to be used by investment officials shall be the “prudent person” standard and shall be applied in the context of managing an overall portfolio. Investment officers acting in accordance with written procedures and the investment policy and exercising due diligence shall be relieved of personal responsibility for an individual security’s credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and appropriate action is taken to control adverse developments.

OBJECTIVES
The City strives to maintain the level of investment of all idle funds as near 100% as possible, through the optimum operation of its cash management system which is designated to accurately monitor and forecast expenditures and revenues.

CRITERIA FOR SELECTING INVESTMENT
POLICIES AND PROCEDURES MANUAL: ADMINISTRATIVE
Subject: STATEMENT OF INVESTMENT POLICY
Effective Date: 03/03/2026
Reference: Council Motion; 10/20/2015, 10/18/16, 11/06/18, 12/15/20, 12/07/21, 03/03/26 SECTION 207

Page 2 of 6 ends

1. SAFETY: It is the primary duty and responsibility of the Treasurer to protect, preserve and maintain cash and investments placed in his/her trust on behalf of the citizens of the Community.

2. LIQUIDITY: An adequate percentage of the portfolio should be maintained in liquid short-term securities which can be converted to cash if necessary to meet disbursement requirements. Since all cash requirements cannot be anticipated, investments in securities with active secondary or resale markets is highly recommended. Emphasis should be on marketable securities with low sensitivity to market risk.

3. YIELD: The potential dollar earnings an investment can provide, and also is sometimes described as the rate of return. Yield should become a consideration only after the basic requirements of safety and liquidity have been met.

4. MARKET-AVERAGE RATE OF RETURN: The investment portfolio shall be designed to attain a market average rate of return throughout budgetary and economic cycles, taking into account the agency’s risk constraints, the cash flow characteristics of the portfolio, and State and Local laws, ordinances or resolutions that restrict investments.

5. DIVERSIFICATION: The investments portfolio will be diversified to avoid incurring unreasonable and avoidable risks regarding specific security types or individual financial institutions.

6. PUBLIC TRUST: All participants in the investment process shall act as custodians of the public trust. Investment officials shall recognize that the investment portfolio is subject to public review and evaluation. The overall program shall be designed and managed with a degree of professionalism that is worthy of the public trust.

DELEGATION OF AUTHORITY
Authority to manage the City of Taft’s investment program is derived from Resolution No. 2135-93 adopted by the City Council on July 6, 1993. Management responsibility for the investment program is hereby delegated to the City Treasurer and/or his/her Designee, who shall establish written procedures for the operation of the investment program consistent with this investment policy. Procedures should include reference to: safekeeping, PSA repurchase agreements, wire transfer agreements, collateral/depository agreements and banking service contracts. Such procedures shall include explicit delegation of authority to persons responsible for investment transactions. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established POLICIES AND PROCEDURES MANUAL: ADMINISTRATIVE
Subject: STATEMENT OF INVESTMENT POLICY
Effective Date: 03/03/2026
Reference: Council Motion; 10/20/2015, 10/18/16, 11/06/18, 12/15/20, 12/07/21, 03/03/26 SECTION 207

Page 3 of 6 ends

by the City Treasurer. The City Treasurer shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials.

REPORTING
The Treasurer shall submit a monthly investment report to the Governing Body. This report will include all required elements of the monthly report as prescribed by Government Code Section 53646.

Required elements of the monthly report:

1. Type of investment.

2. Institution.

3. Date of maturity.

4. Amount of deposit or cost of the security and par value.

5. Market value of investments as of the date of the report and the source of the stated value.

6. Rate of interest.

7. Statement that investments conform to the Investment Policy or the manner in which the investments are not in conformance with the Investment Policy.

8. Statement that there are sufficient funds to meet the next six (6) months’ obligations.

9. Weighted average maturity of the investments.

AUTHORIZED FINANCIAL DEALERS AND INSTITUTIONS
The Treasurer will maintain a list of financial institutions authorized to provide investment services. In addition, a list will also be maintained of approved security broker/dealers selected by credit worthiness, who maintain an office in the State of California. These may include “primary” dealers that qualify under Securities & Exchange Commission Rule 15C3- 1 (Uniform Net Capital Rule). No public deposit shall be made except in a qualified public depository as established by California laws.

All brokers and dealers will inform the City Council, in writing, of any investment decisions which they believe were not advisable but were asked to execute by a City official or agent.

All financial institutions and broker/dealers who desire to become qualified bidders for investment transactions must have filed with the City Treasurer the following: audited financial statements, proof of National Association of Security Dealers certification, and certification of having read the City of Taft’s investment policy. See attached questionnaire and certification form.

POLICIES AND PROCEDURES MANUAL: ADMINISTRATIVE
Subject: STATEMENT OF INVESTMENT POLICY
Effective Date: 03/03/2026
Reference: Council Motion; 10/20/2015, 10/18/16, 11/06/18, 12/15/20, 12/07/21, 03/03/26 SECTION 207

Page 4 of 6 ends

An annual review of the financial condition and registrations of qualified bidders will be conducted by the Treasurer.

A current audited financial statement is required to be on file for each financial institution and broker/dealer in which the City of Taft invests.

CONFLICT OF INTEREST
The Treasurer and all other officials and/or agents, who procure investments on the City’s behalf, shall disclose to the City Manager any financial interest or business relationship they may have with an institution or broker who is conveying an investment instrument to the City. Such notification shall occur before the City acquires the investment. Brokers and investment bankers will disclose all fee sharing arrangements with the City Manager prior to investments being acquired.

INVESTMENT INSTRUMENTS
The City of Taft operates its temporary pooled idle cash investments under the prudent man rule. This affords the City a broad spectrum of investment opportunities as long as the investment is deemed prudent and is allowable under current legislation of the State of California (Government Code Section 53600 et seq.) Investment may be made in the following media:

1. United States Treasury Bills, Bonds and Notes, or those for which the full faith and credit of the United States are pledged for payment of principal and interest. The City shall not invest in any United States security that exceeds five-years of maturity.

2. Obligations issued by the United States Government Agencies such as, Securities issued and backed as to payment by one of the following Government Sponsored Entities (GSE’s):
a) Federal Farm Credit Bank
b) Federal Home Loan Bank.

3. Certificates of Deposit (or Time Deposits) placed with commercial banks and/or savings and loans.

4. Negotiable Certificates of Deposit.

5. Local Agency Investment Fund (State Pool) Demand Deposit.

6. Passbook Savings Accounts.

7. County Pooled Funds.

8. “NOW” Demand Deposits.

Page 5 of 6 ends

The City of Taft will diversify its investments by security type and institution. With the exception of U.S. Treasury securities and authorized pools, no more than 50% of the entity’s total investment portfolio will be invested in a single security type or with a single financial institution. Investment in derivatives is not permitted.

MATURITIES
Security purchases and holdings shall be maintained within statutory limits imposed by the Government Code. Current limits are:

Maximum
Permitted Investments/Deposits Percentages Maturity
US Government Treasury Securities Unlimited 5 years*
Certificates of Deposits Unlimited 5 years*
Negotiable Certificates of Deposit 30% 5 years*
LAIF 15MM** n/a
Passbook Deposits --- n/a
County Pooled Funds 50% n/a
* Maximum term unless expressly authorized by Governing Body and within the prescribed time frame for said approval.
** Limit set by LAIF Governing Board, not Government Code.

BOND PROCEEDS
The investment of bond proceeds will not be governed by this policy, but will be governed by City Council approved documents. Upon the City Council authorizing a bond issue, the investment banker or financial advisor will inform the City Council all investments in the bond documents which deviate from this policy.

COLLATERALIZATION
Collateralization will be required on two types of investments: certificates of deposit and repurchase (and reverse) agreements. In order to anticipate market changes and provide a level of security for all funds, the collateralization level will be one hundred ten percent (110%) of mortgages or one hundred three percent (103%) of government securities of market value of principal and accrued interest. (Government Code Section 53652.) The City of Taft chooses to limit collateral to government securities or first deed mortgages.

Page 6 of 6 ends

Collateral will always be held by an independent third party with whom the entity has a current custodial agreement. A clearly marked evidence of ownership (safekeeping receipt) must be supplied to the City and retained.

INTERNAL CONTROLS
The Treasurer shall establish an annual process of independent review by an external auditor. This review will provide internal control by assuring compliance with policies and procedures.

SAFE KEEPING AND CUSTODY
All security transactions, including collateral for repurchase agreements, entered into by the City of Taft shall be conducted on a delivery-versus-payment (DVP) basis. Securities will be held by a third party custodian designated by the Treasurer and evidenced by safekeeping receipts.

STATEMENT OF INVESTMENT POLICY
The Statement of Investment Policy shall be reviewed and submitted annually to the City Council.

City of Taft
Office of the City Treasurer

BROKER/DEALER QUESTIONNAIRE AND CERTIFICATION
Section I: Statement of Position and General Requirements The City of Taft (the “City”) is a statutory (home rule) Government operating under the laws of the State of California. The City manages an operational portfolio ranging in size from $500,000.00 to $15,000,000.00, which is comprised mainly of U.S. Treasury and Agency obligations as well as selected money market instruments. The City has adopted a written investment policy that regulates the standards and procedures used in its cash management activities. A copy of the Investment policy is provided with this document.

The City maintains relationships with qualified members of the broker/dealer community who, in their opinion, understands the needs, constraints, and goals of the City.

The City will notify broker/dealers of their approval in writing. No transactions will be conducted with an approved broker/dealer until all paperwork required by both parties has been executed. The City solicits competitive bids and offers on the majority of its transactions. City personnel will review and substantiate all information and references requested in the document; therefore, please answer all questions as thoroughly as possible.

Section II – Part I: Request for General Information from Broker/Dealer Candidate

1. Name of firm

2. Address – Local
Headquarters

3. Telephone – Local ( )
Headquarters ( )

4. Contact personnel: (provide an attachment if more space is required) Name
Title
Telephone
Name
Title
Telephone
4a. Provide background information concerning the account representatives listed in No. 4 above. Please include information on the individual’s employment history as it relates to the securities industry, official licenses and certificates, the history and details of any disciplinary actions or complaints and the disposition of each as well as the history of any arbitration or litigation, the nature of the case and status or disposition.

5. Please provide the following information regarding at least four comparable clients with whom any of the representatives listed in No. 4 has an established relationship. We would prefer public sector clients in our geographical area, if possible.

Client Name
Address
Person to Contact/
Telephone
Length of relationship
Client Name
Address
Person to Contact/
Telephone
Length of relationship
Client Name
Address
Person to Contact/
Telephone
Length of relationship
Client Name
Address
Person to Contact/
Telephone
Length of relationship

6. Has/have the representative(s) listed in No. 4 been authorized by the firm to be account representative(s) for the City of Taft?
Yes No
If Yes, by whom?

7. Please list the name and title of the immediate supervisor of the account representative(s) named in your response to No. 4 above.

1. 2.

3. 4.

8. Is your firm a member of NASD? Yes No
If not, why?

9. Place an “X” by each regulatory agency that your firm is examined by and/or subject to its rules and regulations:

FDIC SEC NYSE
Comptroller of Currency Federal Reserve System

10. Have you obtained all required licenses to operate as a broker/dealer in the State of California?
Yes No

11. If you are not a Bank, please provide the following information regarding your principal banking relationship.

Bank Name
Address
Bank Contact
Telephone
Length of Relationship

12. Place and “X” by each of the instruments below in which you make an active market (both buy and sell):

T-Bills T-Notes
BA-Domestic BA-Foreign
Commercial Paper Medium Term Notes
Repurchase Agreements Reverse Repo
Federal Agencies-please specify below

13. Does your firm specialize in any of the instruments listed above? If so, please specify which ones.

Section II – Part II: Request for Broker/Dealer Candidate Disclosure To the best of your knowledge, has there been any “material” litigation, arbitration or regulatory proceedings, either pending, adjudicated or settled, that your firm has been subject to within the last five years that involved issues concerning the suitability of the sale or purchase of securities to institutional clients or fraudulent or unfair practices related to the sale of securities to a client? If so, please describe each such matter briefly. For purposes of this section, proceedings are “material” if your independent accountant applying generally accepted accounting principles determines that such proceedings required disclosure on your financial statements.

14. Please provide certified audited financial statements for the last three years. In addition, for those dealers preparing and submitting financial statements to the following organizations, please provide publicly available financial documents file with these agencies for the previous two years.

National Association of Securities Dealers
Securities and Exchange Commission
New York Stock Exchange
Federal Deposit Insurance Corp.

Section III: Certification
I hereby certify that I have personally read the City of Taft's Investment Policy and the California Government Codes pertaining to the investments of the City of Taft; that the above information is true and correct to the best of my knowledge; and that I am authorized to execute this request for information on behalf of
(name of firm).

Signed
Print Name
Title
Date
Counter signature by Company president or person in charge of government securities operations
Signed
Print Name
Title
Date

GLOSSARY
AGENCIES - Agencies of the Federal government set up to supply credit to various classes of institutions (e.g. S&L's, Small business firms, students, farmers, housing agencies, etc.) ASK/OFFER - The price at which securities are offered. (The price at which a firm will sell a security to an investor.)
BANKERS ACCEPTANCE (BA) - A draft or bill of exchange accepted by a bank or trust company. The accepting institution guarantees payment of the bill, as well as the issuer.

BASIS POINT - One one-hundredth of a percent (i.e. 0.01%) BEAR MARKET - A period of generally pessimistic attitudes and declining market prices.

BOND EQUIVALENT YIELD - The basis on which yields on notes and bonds are quoted.

BROKER/DEALER - Individual or firm acting as principal in securities transaction.

BULL MARKET - A period of generally optimistic attitudes and increasing market prices.

CALLABLES - Securities that the issuer has the right to redeem prior to maturity.

CERTIFICATE OF DEPOSIT (CD) - A time deposit with a specific maturity evidenced by a certificate. Large denomination CD's are typically negotiable.

CMT - Constant Maturity Treasury
COLLATERAL - Securities, evidence of deposit or other property which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies.

CORPORATE MEDIUM TERM NOTE - A security issued by a corporation doing business in the U.S. with a maturity not to exceed five years.

COUPON - a) The annual rate of interest that a bond's issuer promises to pay the bondholder on the bond's face value; b) A certificate attached to a bond evidencing interest due on a payment date.

DEBENTURE - A bond secured only by the general credit of the issuer.

DELIVERY VS PAYMENT - Deliver of securities with a simultaneous exchange of money.

DERIVATIVES - Financial products that are dependent for their value on (or derived from) an underlying financial instrument, a commodity, or an index representing values of groups of such instruments or assets.

DIVERSIFICATION - Dividing investment funds among a variety of securities offering independent returns.

FEDERAL FUND RATE - The rate of interest associated with borrowing a Federal Reserve bank's excess reserves. This rate is currently pegged by the Federal Reserve through openmarket operations.

FEDERAL OPEN MARKET COMMITTEE (FOMC) - Consists of seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member, while the other presidents serve on a rotating basis. The committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of Government Securities in the open market as a means of influencing the volume of bank credit and money.

INTERNAL RATE OF RETURN - Rate of return over the life of a security.

LOCAL AGENCY INVESTMENT FUND (LAIF) - The aggregate of all funds from political subdivisions that are place in the custody of the State Treasurer for investment and reinvestment.

MARKET VALUE - The price at which a security is trading, usually the liquidation value.

OPEN MARKET OPERATIONS - Federal Reserve activity. Under the Federal Reserve Act, the Fed uses purchases and sales of Government and Federal Agency securities to add to or subtract from commercial bank reserves. Goals are to sustain economic growth, high employment and reasonable price stability.

PAPER GAIN OR LOSS - Term used for unrealized gain or loss on securities being held in a portfolio based on comparison of current market quotes and their original cost. This situation exists as long as the security is held while there is a difference between market value and the purchase price.

PRIMARY DEALER - A group of government securities dealers who submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission (SEC) registered securities broker/dealers, banks and a few unregulated firms.

RATE OF RETURN - The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity; on a bond, the current income return.

SAFEKEEPING - The service provided by banks and trust companies for clients when the bank or trust company stores the securities, takes in coupon payments, and redeems issues at maturity.

SPREAD - a) The yield or price difference between the bid and offer on an issue; b) The yield or price difference between different issues.

SWAP - The sale of one issue and the simultaneous purchase of another for some perceived advantage.

TREASURY BILLS - A non-interest bearing discount security issued by the U.S. Treasury to finance the national debt. Most bills are issued to mature in three months, six months or one year.

TREASURY BONDS - Long-term U.S. Treasury securities having initial maturities of more than ten years.

TREASURY NOTES - Intermediate-term coupon bearing U.S. Treasury securities having initial maturities of one year to ten years.

WHEN ISSUED BASIS (WI) - A term applied to securities that are traded before they are actually issued, with the stipulation that transactions are null and void if securities are not issued.

YIELD CURVE - Yield calculations of various maturities at a given time to observe spread differences.

YIELD TO MATURITY - The current income yield minus any premium above par, or plus any discount from par in the purchase price with the adjustment spread over the period from date of purchase to maturity.

REVIEWED BY:

CITY CLERK FINANCE DIRECTOR CITY MANAGER
City of Taft Agenda Report
DATE: MARCH 3, 2026
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:

TRANSPORTATION DEVELOPMENT ACT FUNDS ANNUAL AUDIT – FY 2020-2021 SUMMARY STATEMENT:

Attached for Council information and review is the Annual Audit for the Taft Transportation Development Act Funds (TDA).

This audit is conducted by and submitted to Kern Council of Governments.

RECOMMENDED ACTION
Motion to receive and file the City of Taft Transportation Development Act Funds Annual Audit for the fiscal year 2020-2021and 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 – Audit report
PREPARED BY: Teresa Binkley, Finance Director

REVIEWED BY:

CITY CLERK FINANCE DIRECTOR CITY MANAGER
City of Taft Agenda Report
DATE: MARCH 3, 2026
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:

TRANSPORTATION DEVELOPMENT ACT FUNDS ANNUAL AUDIT – FY 2021-2022 SUMMARY STATEMENT:

Attached for Council information and review is the Annual Audit for the Taft Transportation Development Act Funds (TDA).

This audit is conducted by and submitted to Kern Council of Governments.

RECOMMENDED ACTION
Motion to receive and file the City of Taft Transportation Development Act Funds Annual Audit for the fiscal year 2021-2022 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 – Audit report
PREPARED BY: Teresa Binkley, Finance Director

REVIEWED BY:

CITY CLERK FINANCE DIRECTOR CITY MANAGER
City of Taft Agenda Report
DATE: MARCH 3, 2026
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:

ANNUAL AUDITED FINANCIAL STATEMENTS FOR FY 2021-2022
SUMMARY STATEMENT:

These Audit Reports were presented and reviewed by the Finance Committee on February 26, 2026, and was recommended to be forwarded to the City Council to be received and filed.

Attached are the Annual Audited Reports for the years ended June 30, 2022, which includes the Annual Comprehensive Financial Report (ACFR), Management Report (City wide), Wastewater Treatment Plant Financial Statements (WWTP) and Management Report for Wastewater Treatment Plant.

The city did not spend over $750,000 in Federal funds; no single audit was required.

RECOMMENDED ACTION
Motion to receive and file the Annual Audited Comprehensive Financial Reports for the year ended June 30, 2022 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, 2022, WWTP Financial Statements and
Management Report for Wastewater Treatment Plant
PREPARED BY: Teresa Binkley, Finance Director

CITY OF TAFT

ANNUAL FINANCIAL REPORT

FOR THE FISCAL YEAR ENDED
JUNE 30, 2022
i

CITY OF TAFT

ANNUAL FINANCIAL REPORT
JUNE 30, 2022

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 .......................................................................................... 62 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – WWTP Special Revenue Fund .............................................................. 63 Schedule of Plan’s Proportionate Share of Net Pension Liability and Related Ratios as of Measurement Date – Combined Plan .................................................................................. 64 Schedule of Pension Contributions – Combined Plan .................................................................... 66 Other Supplemental Information
Major Fund Budgetary Comparison Schedule
Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – WWTP Capital Projects Fund ................................................................ 70

CITY OF TAFT

ANNUAL FINANCIAL REPORT
JUNE 30, 2022
TABLE OF CONTENTS (Continued)
Non-Major Governmental Funds
Combining Balance Sheet .............................................................................................................. 72 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
Combining Statement of Net Position - Private-Purpose Trust Funds ........................................... 84 Combining Statement of Changes in Net Position -
Private- Purpose Trust Funds ................................................................................................... 85 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 9465 WILSHIRE BLVD., 3RD FLOOR 5800 HANNUM AVENUE, SUITE E HADLEY Y HUI, CPA BEVERLY HILLS, CA 90212 CULVER CITY, CA 90230 ADAM V GUISE, CPA TEL: 310.670.2745 TEL: 310.670.2745
TRAVIS J HOLE, CPA FAX: 310.670.1689 FAX: 310.670.1689
WILSON LAM, CPA www.mlhcpas.com www.mlhcpas.com
INDEPENDENT AUDITOR’S REPORT
To the City Council
City of Taft, California
Opinions
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of City of Taft, California (City) as of and for the fiscal year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.

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

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

Responsibilities of Management 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, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
2 Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions.

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

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

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

Required Supplementary Information
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 62 and 63, the schedule of plan’s proportionate share of net pension liability on page 64 and the schedule of pension contributions on page 66, 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. .
3 Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The WWTP Capital Projects budgetary comparison schedule, the combining and individual nonmajor governmental and fiduciary funds financial statements and budgetary schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain 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, the combining and individual nonmajor governmental and fiduciary funds financial statements and budgetary schedules are 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 November 19, 2025, 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
November 19, 2025
4 This page intentionally left blank
ASSETS
Cash and investments 6,426,803 $ 9,062,305 $ 15,489,108 $ Restricted cash and investments - 2,526 2,526
Cash and investments with fiscal agents 2,623,866 - 2,623,866 Accounts receivable 1,727,868 338,509 2,066,377
Interest receivable 10,400 3,558 13,958
Internal balances (2,397,349) 2,397,349 -
Notes receivable 3,436,561 - 3,436,561
Prepaid expenses 93,734 - 93,734
Capital assets, not being depreciated 1,972,455 11,850 1,984,305 Capital assets, being depreciated 27,764,019 12,964,264 40,728,283 Capital assets, accumulated depreciation (15,908,939) (9,134,661) (25,043,600) Total assets 25,749,418 15,645,700 41,395,118

DEFERRED OUTFLOWS OF RESOURCES
Pension related 2,338,802 739,243 3,078,045
Total deferred outflows of resources 2,338,802 739,243 3,078,045

LIABILITIES
Accounts payable 412,443 78,855 491,298
Accrued payroll 178,475 36,965 215,440
Accrued interest payable 306 316 622
Retention payable 18,887 - 18,887
Unearned revenue 147,191 34,927 182,118
Deposits payable 1,929 58,149 60,078
Noncurrent liabilities:

Due within one year 142,033 29,609 171,642
Due in more than one year 3,435,355 123,440 3,558,795
Net pension liability 5,132,968 1,920,454 7,053,422
Total liabilities 9,469,587 2,282,715 11,752,302

DEFERRED INFLOWS OF RESOURCES
Pension related 5,414,857 1,746,019 7,160,876
Total deferred inflows of resources 5,414,857 1,746,019 7,160,876

NET POSITION
Net investment in capital assets 10,453,974 3,762,449 14,216,423 Restricted for:

Streets and roads 986,156 - 986,156
Public safety 214,194 - 214,194
Pensions 2,623,866 - 2,623,866
Community development 3,610,566 - 3,610,566
Capital projects - WWTP 4,570,860 - 4,570,860
Unrestricted (9,255,840) 8,593,760 (662,080)
Total net position 13,203,776 $ 12,356,209 $ 25,559,985 $

See accompanying notes to financial statements

CITY OF TAFT

STATEMENT OF NET POSITION
JUNE 30, 2022
Governmental
Activities
Business-type
Activities Total
5 CITY OF TAFT

STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Expenses
Governmental activities:

General government (3,271,448) $ 552,297 $ 2,270,608 $ - $ Public safety (5,876,713) 37,451 281,531 -
Public works (1,841,969) 169,535 592,444 158,048
Community development (1,600,711) - 56,493 -
Interest on long-term debt (62,119) - - -
Total governmental activities (12,652,960) 759,283 3,201,076 158,048 Business-type activities:

Community correctional facility (CCF) 124,092 - - -
Federal WWTP (628,843) 565,778 - -
Sewer (1,197,356) 1,198,248 - -
Refuse (1,280,404) 922,356 56,535 -
Transit (825,709) 361,117 31,659 -
Total business-type activities (3,808,220) 3,047,499 88,194 - Total primary government (16,461,180) $ 3,806,782 $ 3,289,270 $ 158,048 $ General revenues:

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
$ - (448,543) $ (448,543) $
- (5,557,731) (5,557,731)
- (921,942) (921,942)
- (1,544,218) (1,544,218)
- (62,119) (62,119)
- (8,534,553) (8,534,553)
124,092 - 124,092
(63,065) - (63,065)
892 - 892
(301,513) - (301,513)
(432,933) - (432,933)

(672,527) - (672,527)
(672,527) (8,534,553) (9,207,080)
- 1,695,340 1,695,340
- 2,322,234 2,322,234
- 157,478 157,478
(46,813) (473,234) (520,047)
- 1,902,506 1,902,506
(46,813) 5,604,324 5,557,511
(719,340) (2,930,229) (3,649,569)
13,128,614 15,677,125 28,805,739
(53,065) 456,880 403,815
13,075,549 16,134,005 29,209,554
$ 12,356,209 13,203,776 $ 25,559,985 $
Business-type
Activities Total
Governmental
Activities
7 CITY OF TAFT

GOVERNMENTAL FUNDS

BALANCE SHEET
JUNE 30, 2022
ASSETS General
Revolving Loan
Fund CDBG
Revolving Loan
Fund Home
Cash and investments $ 10,176 337,375 $ 58,808 $
Cash and investments with fiscal agents - 2,623,866 -
Receivables:

Accounts - 867,770 4,165
Interest - 8,745 85
Notes 1,802,955 - 1,506,255
Prepaid items - 93,734 -
Total assets 3,931,490 $ 1,813,131 $ 1,569,313 $

LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCES

LIABILITIES
Accounts payable $ - 354,514 $ - $
Accrued payroll - 156,191 -
Due to other funds - - -
Deposit payable - 1,929 -
Unearned revenue - 147,191 -
Retention payable - 18,887 -
Advance from - 1,819,682 -
Total liabilities 2,498,394 - -

DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - 1,506,255 1,802,955
Total deferred inflows of resources - 1,802,955 1,506,255

FUND BALANCES
Nonspendable 93,734 - -
Restricted 2,623,866 10,176 63,058
Unassigned (1,284,504) - -
Total fund balances (deficits) 1,433,096 10,176 63,058
Total liabilities, deferred inflows of
resources, and fund balances 3,931,490 $ 1,813,131 $ 1,569,313 $ See accompanying notes to financial statements
8 WWTP Special
Revenue
WWTP Capital
Projects
Total Nonmajor
Governmental
Funds Total
$ 4,570,368 344,396 $ $ 6,411,423 1,090,300 $
- - - 2,623,866
- 587,413 1,727,868 268,520
492 - 10,400 1,078
- - 3,436,561 127,351
- - 93,734 -
$ 4,570,860 931,809 $ 1,487,249 $ 14,303,852 $
$ - 56,182 $ $ 411,784 1,088 $
- 4,925 172,317 11,201
- 430,369 577,667 147,298
- - 1,929 -
- - 147,191 -
- - 18,887 -
- - 1,819,682 -
- 491,476 159,587 3,149,457
- 574,923 4,011,484 127,351
- 574,923 127,351 4,011,484
- - - 93,734
4,570,860 - 1,301,121 8,569,081
- (134,590) (100,810) (1,519,904)
4,570,860 (134,590) 1,200,311 7,142,911
$ 4,570,860 931,809 $ 1,487,249 $ 14,303,852 $
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, 2022
Fund balances of governmental funds 7,142,911 $
Amounts reported for governmental activities in the statement of net position are different because:

Capital assets, lease assets, net of depreciation and amortization have not been included as financial resources in governmental funds.

These amounts do not include internal service fund capital assets costing $63,385 and accumulated depreciation and amortization of $42,940).

Total capital assets 29,673,089 $
Accumulated depreciation (15,865,999) 13,807,090
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, leases payable, compensated absences, and net pension liability (not including compensated absences of $8,563 and lease liabilities of $26,335). (8,675,458)
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 (5,414,857) $ Deferred outflows of resources relating to pensions 2,338,802 (3,076,055) 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. (5,890)
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. 4,011,484
Accrued interest payable from the current portion of interest due on long-term debt issuance have not been reported in the governmental funds. (306)
Net position of governmental activities 13,203,776 $
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, 2022
General
Revolving Loan
Fund CDBG
Revolving Loan
Fund Home

REVENUES
Property taxes $ - 1,695,341 $ - $
Sales taxes - 2,083,496 -
Other taxes - 396,217 -
Licenses, permits, and fees - 292,725 -
Fines and forfeitures - 2,471 -
Use of money and property 15 (323,576) (1,096)
Intergovernmental 17,207 1,347,738 140,721
Current service charges - 394,966 -
Other - 1,767,896 -
Total revenues 7,657,274 17,222 139,625

EXPENDITURES
Current:

General government - 1,516,628 -
Public safety - 3,687,572 -
Public works - 1,108,598 -
Community development 89 797,458 80,094
Capital outlay - 1,066,045 -
Debt service:

Principal retirement - 7,162 -
Interest and fiscal charges - 1,838 -
Total expenditures 8,185,301 89 80,094
Excess of revenues
over (under) expenditures (528,027) 17,133 59,531

OTHER FINANCING SOURCES (USES)
Transfers in - 50,133 -
Transfers out (17,133) - -
Total other financing sources (uses) 50,133 (17,133) -
Net change in fund balances (477,894) - 59,531
Fund balances, beginning of fiscal year 1,728,134 - 3,527 Prior period adjustments 182,856 10,176 -
Fund balances (deficits) , beginning of fiscal
year, restated 1,910,990 10,176 3,527
Fund balances (deficits), end of fiscal year 1,433,096 $ 10,176 $ 63,058 $ See accompanying notes to financial statements
12 WWTP Special
Revenue
WWTP Capital
Projects
Total Nonmajor
Governmental
Funds Total
$ - - $ $ 1,695,341 - $
- - 2,083,496 -
- - 396,217 -
- - 292,725 -
- - 7,038 4,567
(202) 327 (338,623) (14,091)
- 1,092,824 3,413,898 815,408
- 64,554 471,832 12,312
- - 1,767,896 -
(202) 1,157,705 818,196 9,789,820
- 932,992 2,449,620 -
- - 3,980,537 292,965
- - 1,455,674 347,076
- - 877,641 -
- - 1,223,845 157,800
- 72,581 83,324 3,581
- 58,529 61,286 919
- 1,064,102 802,341 10,131,927
(202) 93,603 15,855 (342,107)
131,200 - 181,333 -
- (131,200) (181,333) (33,000)
131,200 (131,200) (33,000) -
130,998 (37,597) (17,145) (342,107)
4,439,862 (96,993) 1,217,456 7,291,986
- - - 193,032
4,439,862 (96,993) 1,217,456 7,485,018
$ 4,570,860 (134,590) $ 1,200,311 $ 7,142,911 $
13 14
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Net change in fund balances of governmental funds (342,107) $ 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 or amortization expense (does not include internal service fund amortization of $3,169).

This activity is reconciled as follows:

Capital outlay 1,223,845 $
Capitalized assets recorded as public works expense 268,765 Less land, structures, and improvements capitalized originally and then donated during the fiscal year (689,404)
Depreciation expense (1,132,858) (329,652)
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. (67,089)
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: (2,263,768) Accrued interest is interest due on long-term debt payable. The net change for the period is 86
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 are reported under governmental activities. 412
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 (does not include internal service fund compensated absences change of $501 or principal payment on long term debt of $3,580).

Principal payment on long term debt 83,324
Compensated absences (11,435)
Change in net position of governmental activities (2,930,229) $ See accompanying notes to financial statements
FOR THE FISCAL YEAR ENDED JUNE 30, 2022

CITY OF TAFT

GOVERNMENTAL FUNDS

RECONCILIATION OF STATEMENT OF REVENUES, EXPENDITURES,

AND CHANGES IN FUND BALANCES

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

Cash and investments 2,134,786 $ 1,454,596 $ 3,735,827 $ Restricted cash and investments - - -
Receivables:

Accounts - 47,059 145,551
Interest 249 1,041 1,131
Due from other funds 260,154 317,513 -
Total current assets 2,395,189 1,820,209 3,882,509
Noncurrent assets:

Advance to - 3,633,671 -
Capital assets, not being depreciated 11,850 - -
Capital assets, being depreciated/amortized 339,039 5,966,927 2,979,263 Capital assets, accumulated depreciation or
amortization (318,918) (4,773,852) (2,079,962)
Total noncurrent assets 31,971 4,826,746 899,301
Total assets 2,427,160 6,646,955 4,781,810

DEFERRED OUTFLOWS OF RESOURCES
Pension related 529,544 24,278 43,423
Total deferred outflows of resources 529,544 24,278 43,423

LIABILITIES
Current Liabilities:

Accounts payable - 9,480 6,256
Accrued payroll - 3,202 5,301
Interest payable - - -
Unearned revenue - - -
Deposits payable - - 31,052
Current portion of compensated absences - 2,710 5,089
Current portion of lease liabilities - 3,699 3,699
Total current liabilities - 19,091 51,397
Noncurrent liabilities:

Compensated absences - 8,130 15,266
Lease liabilities - 22,636 22,636
Advances from - - -
Net pension liability 1,317,505 66,696 127,695
Total noncurrent liabilities 1,317,505 97,462 165,597
Total liabilities 1,317,505 116,553 216,994

DEFERRED INFLOWS OF RESOURCES
Pension related 1,204,331 60,226 114,430
Total deferred inflows of resources 1,204,331 60,226 114,430

NET POSITION
Net investment in capital assets 31,971 1,166,740 872,966 Unrestricted 402,897 5,327,714 3,620,843
Total net position 434,868 $ 6,494,454 $ 4,493,809 $
See accompanying notes to financial statements
Enterprise Funds

CITY OF TAFT

STATEMENT OF NET POSITION

PROPRIETARY FUNDS
JUNE 30, 2022
Business-type Activities
16 Governmental
Activities
Refuse Transit
Total Enterprise
Funds
Internal Service
Fund
$ - 1,737,096 $ 9,062,305 $ 15,380 $
2,526 - 2,526 -
41,618 104,281 338,509 -
- 1,137 3,558 -
- - 577,667 -
44,144 1,842,514 9,984,565 15,380
- - 3,633,671 -
- - 11,850 -
3,020,607 658,428 12,964,264 63,385
(1,328,691) (633,238) (9,134,661) (42,940)
1,691,916 25,190 7,475,124 20,445
1,736,060 1,867,704 17,459,689 35,825
65,395 76,603 739,243 -
65,395 76,603 739,243 -
6,138 56,981 78,855 659
16,832 11,630 36,965 6,158
316 - 316 -
16,220 18,707 34,927 -
- 27,097 58,149 -
3,575 7,138 18,512 8,563
- 3,699 11,097 3,699
43,081 125,252 238,821 19,079
10,724 21,413 55,533 -
- 22,635 67,907 22,636
1,813,989 - 1,813,989 -
179,980 228,578 1,920,454 -
2,004,693 272,626 3,857,883 22,636
2,047,774 397,878 4,096,704 41,715
162,519 204,513 1,746,019 -
162,519 204,513 1,746,019 -
1,691,916 (1,144) 3,762,449 (5,890)
(2,100,754) 1,343,060 8,593,760 -
$ (408,838) 1,341,916 $ 12,356,209 $ (5,890) $
Business-type Activities
Enterprise Funds
17 CCF Federal WWTP Sewer

OPERATING REVENUES
Charges for services $ 565,778 - $ 1,194,335 $
Connection and installation fees - - 1,008
Other - - 2,905
Total operating revenues - 565,778 1,198,248

OPERATING EXPENSES
Salaries and wages 131,633 (363,329) 282,456
Training and development - - -
Contract and professional services 34,010 535 38
Maintenance and operations 4,994 3,320 598,964
Materials and supplies 205 188 517
Insurance 80,604 171,213 63,357
Utilities 55,445 40,440 373
Administrative service charges - 130,435 54,101
Depreciation 240,274 21,415 76,831
Bad debt expense - - -
Other operating expenses 26,658 2,126 43,466
Total operating expenses (124,092) 627,924 1,196,437
Operating income (loss) 124,092 (62,146) 1,811

NONOPERATING REVENUES (EXPENSES)
Investment income (loss) (13,731) (1,967) (15,649)
Interest expense (919) - (919)
Intergovernmental - - -
Total nonoperating revenues (expenses) (1,967) (14,650) (16,568) Changes in net position 122,125 (76,796) (14,757)
Total net position, beginning of fiscal year 312,743 6,577,552 4,514,868 Prior period adjustments - (6,302) (6,302)
Total net position, beginning of fiscal year, restated 312,743 6,571,250 4,508,566 Total net position, end of fiscal year 434,868 $ 6,494,454 $ 4,493,809 $ See accompanying notes to financial statements
Business-type Activities
Enterprise Funds

CITY OF TAFT

STATEMENT OF REVENUES, EXPENSES, AND

CHANGES IN FUND NET POSITION

PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
18 Governmental
Activities
Refuse Transit
Total Enterprise
Funds
Internal Service
Fund
$ 361,105 922,356 $ $ 3,043,574 $ 224,714
- - 1,008 -
12 - 2,917 -
361,117 922,356 3,047,499 224,714
422,197 499,598 972,555 176,115
- 3,000 3,000 -
1,918 449,104 485,605 -
98,061 108,872 814,211 9,420
14,021 7,596 22,527 11,250
61,347 61,841 438,362 -
- 6,727 102,985 5,233
69,139 - 253,675 13,385
127,840 26,637 492,997 3,169
1,579 - 1,579 -
88,242 55,119 215,611 4,811
823,353 1,279,485 3,803,107 223,383
(462,236) (357,129) (755,608) 1,331
- (15,466) (46,813) -
(2,356) (919) (5,113) (919)
31,659 56,535 88,194 -
29,303 40,150 36,268 (919)
(432,933) (316,979) (719,340) 412
58,254 1,665,197 13,128,614 -
(34,159) (6,302) (53,065) (6,302)
24,095 1,658,895 13,075,549 (6,302)
$ (408,838) 1,341,916 $ 12,356,209 $ (5,890) $
Business-type Activities
Enterprise Funds
19 STATEMENT OF CASH FLOWS

PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Business-type Activities
Enterprise Funds
CCF Federal WWTP Sewer
Cash Flows from Operating Activities:

Cash received from customers and users 97,182 $ 565,778 $ 1,208,024 $ Cash paid to suppliers for goods and services (276,699) (257,985) (862,665) Cash paid to employees for services (633,730) (72,799) (122,181) Net cash provided (used) by operating activities (813,247) 234,994 223,178 Cash Flows from Capital and Related Financing Activities:

Interest paid - (920) (919)
Principal paid - (3,580) (3,580)
Net cash provided (used) by capital and related financing activities - (4,500) (4,499) Cash Flows from Non-Capital Financing Activities:

Intergovernmental grants received - - -
Cash received (paid) to/from other funds, including interest (260,154) (671,441) - Net Cash provided by Non-Capital Financing Activities: (260,154) (671,441) - Cash Flows from Investing Activities:

Interest received (2,147) (14,468) (16,513)
Net Cash provided (used) by investing activities (2,147) (14,468) (16,513) Net increase (decrease) in cash and cash equivalents (1,075,548) (455,415) 202,166 Cash and Cash Equivalents at Beginning of Fiscal Year 3,210,334 1,910,011 3,533,661 Cash and Cash Equivalents at End of Fiscal Year 2,134,786 $ 1,454,596 $ 3,735,827 $ Reconciliation to Statement of Net Position:

Cash and investments 2,134,786 $ 1,454,596 $ 3,735,827 $ Restricted cash and investments - - -
Total cash and cash equivalents 2,134,786 $ 1,454,596 $ 3,735,827 $ Reconciliation of Operating Income (Loss) to Net Cash
Provided (Used) by Operating Activities:

Operating income (loss) 124,092 $ (62,146) $ 1,811 $
Adjustments to reconcile operating income (loss) to
net cash provided (used) by operating activities:

Depreciation 21,415 240,274 76,831
(Increase) decrease in accounts receivable 97,182 - 9,776 (Increase) decrease in prepaid expenses - - -
(Increase) decrease in deposits - - 17,467
(Increase) decrease in deferred outflows of resources - pension 510,126 (6,142) (25,843) Increase (decrease) in deferred inflows of resources - pension 999,750 59,447 112,925 Increase (decrease) in net pension liability (2,503,641) 4,617 70,490 Increase (decrease) in accounts payable (58,877) (1,968) (47,608) Increase (decrease) in accrued payroll (3,294) 265 1,276 Increase (decrease) in unearned revenue - - -
Increase (decrease) in deposits payable - - 4,626
Increase (decrease) in compensated absences - 647 1,427 Total adjustments (937,339) 297,140 221,367
Net cash provided (used) by operating activities (813,247) $ 234,994 $ 223,178 $ Noncash change in fair market value $ 20,947 5,021 $ 22,758 $ See accompanying notes to financial statements

CITY OF TAFT
20 Governmental
Business-type Activities Activities
Internal
Enterprise Funds Service
Refuse Transit Totals Fund
$ 642,035 965,740 $ 3,478,759 $ 224,714 $
(271,199) (719,566) (2,388,114) (42,171)
(409,506) (214,076) (1,452,292) (176,127)
(38,670) 32,098 (361,647) 6,416
(2,040) (919) (4,798) (920)
- (3,581) (10,741) (3,580)
(2,040) (4,500) (15,539) (4,500)
31,659 56,535 88,194 -
(34,564) - (966,159) -
(2,905) 56,535 (877,965) -
- (16,299) (49,427) -
- (16,299) (49,427) -
(43,615) 67,834 (1,304,578) 1,916
46,141 1,669,262 10,369,409 13,464
$ 2,526 1,737,096 $ 9,064,831 $ 15,380 $
$ - 1,737,096 $ 9,062,305 $ 15,380 $
2,526 - 2,526 -
$ 2,526 1,737,096 $ 9,064,831 $ 15,380 $
$ (462,236) (357,129) $ (755,608) $ 1,331 $
127,840 26,637 492,997 3,169
276,146 29,677 412,781 -
- - - 2,466
- - 17,467 -
34,143 (41,579) 470,705 -
129,909 198,300 1,500,331 -
(153,362) 124,473 (2,457,423) -
2,117 37,549 (68,787) (538)
122 2,706 1,075 489
4,772 13,707 18,479 -
- (3,865) 761 -
1,879 1,622 5,575 (501)
423,566 389,227 393,961 5,085
$ (38,670) 32,098 $ (361,647) $ 6,416 $
$ - 22,894 $ - $
21 Inmate
Private-Purpose Custodial
Trust Funds Fund
ASSETS
Cash and investments 20,959 $ 11,579 $
Interest receivable 191 -
Prepaid items 196,422 -
Capital assets - nondepreciable 1,698,163 -
Capital assets - being depreciated 407,116 -
Capital assets - accumulated depreciation (286,995) -
Total assets 2,035,856 11,579

LIABILITIES
Accounts payable 7 -
Accrued payroll 1,126 -
Accrued interest payable 15,742 -
Bonds payable due within one year 274,000
Loan payable to City of Taft due in more than one year 1,588,959 - Bonds payable due in more than one year 1,230,000 -
Total liabilities 3,109,834 -

NET POSITION
Unrestricted (1,073,978) -
Restricted for inmates - 11,579
Total net position (deficit) (1,073,978) $ 11,579 $
See accompanying notes to financial statements

CITY OF TAFT

STATEMENT OF NET POSITION

FIDUCIARY FUNDS
JUNE 30, 2022
22 CITY OF TAFT

FIDUCIARY FUNDS

STATEMENT OF CHANGES IN NET POSITION
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Private Purpose Trust
Funds Inmate Custodial Fund
Additions:

Investment revenue (loss) (895) $ - $
Deposits into inmate accounts - 1,363
Taxes and assessments 442,632 -
Total additions 441,737 1,363
Deductions:

Community development 48,511 -
Interest expense 50,679 -
Payments on behalf of inmates - 1,396
Depreciation 9,978 -
Total deductions 109,168 1,396
Change in net position 332,569 (33)
Net Position (Deficit) - July 1, 2021 (826,310) 11,612
Prior period adjustment (580,237) -
Net Position (Deficit) , July 1, 2021, restated (1,406,547) 11,612 Net Position (Deficit) - June 30, 2022 (1,073,978) $ 11,579 $ See accompanying notes to financial statements
23 24
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CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
25 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.)

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
26 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:

 Custodial Funds. The Custodial Funds are account for activities carried out exclusively for the benefit of others outside the City but not administered through other fiduciary trusts or equivalent arrangements. for assets held by the City as an agent. City has one custodial fund, the Inmate Custodial Fund, which records amounts earned by or deposited on behalf of inmates for utilization in the prison commissary.

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
27 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 non-major 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 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

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
28 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Basis of Accounting/Measurement Focus (Continued)
Governmental Fund Financial Statements (Continued)
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 longterm 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 Capital Projects Fund is used to account for capital asset acquisition and construction of the wastewater treatment plant.

The WWTP Special Revenue Fund is used to account for special projects related to the City’s share 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, but the program ended in the fiscal year ending June 30, 2021. See subsequent event note.

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
29 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 a custodial fund and private purpose trust funds. These funds use the accrual basis of accounting; custodial funds are held on behalf of inmates housed in the Community Correctional Facility. The fund is custodial in nature (assets equal liabilities) and therefore do not involve measurement of results of operations. The private purpose trust 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.

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
30 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 yearend. 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, infrastructure assets (roads, bridges, etc.), and right to use leased assets 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 fiscal 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 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 reported on the Statement of Net Position of the government-wide financial statements as a reduction in the book value of capital assets.

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
31 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) G. Capital Assets and Depreciation (Continued)
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, 2022.

K. Compensated Absences
The compensated absences accrual on June 30, 2022, amounted to $222,714 for Governmental Activities and $74,045 for Business-type Activities.
 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.

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
32 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) K. Compensated Absences (Continued)
 Vacation leave liability
Employees earn ten days’ vacation leave per fiscal 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.

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.

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
33 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Q. New Accounting Pronouncements
GASB Statement Number 87 “Leases” Implementation
Governmental Accounting Standards Board issued Statement No. 87 “Leases” to better meet the information needs of financial statement users by improving accounting and financial reporting for leases by governments.

This statement increases the usefulness of governments’ financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract. It establishes a single model for lease accounting based on the foundational principle that leases are financings of the right to use an underlying asset. Under this Statement a lessee is required to recognize a lease liability and an intangible right to use asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources, thereby enhancing the relevance and consistency of information about governments’ leasing activities. Implementation of GASB No. 87 resulted in the City recognizing opening lease liabilities of $239,327, right to use assets of $507,081 and accumulated amortization of $318,180 as follows as of July 1, 2021. See Note 1R for further information on the prior period adjustments.

Future Accounting Standards:

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

The provisions of Statement Number 91 “Conduit Debt Obligations” are effective for reporting periods beginning after December 15, 2021.

The provisions of 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 of 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 of 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.

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
34 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Q. New Accounting Pronouncements (Continued)
Future Accounting Standards (Continued):

The provisions for Statement Number 103 “Financial Reporting Model Improvements” are effective for fiscal years beginning after June 15, 2025.

The provisions for Statement Number 104 “Disclosure of Certain Capital Assets” are effective for fiscal years after June 15, 2025.

R. Prior Period Adjustments
The City implemented the provisions of Governmental Accounting Standards Board Statement Number 87 “Leases” for the fiscal year ending June 30, 2022, resulting in recording opening balance adjustments for a right to use lease building, accumulated amortization on the right to use lease building, and a lease payable. In addition, the City recorded a correction for a retainage payable that was paid in the previous fiscal year and some miscellaneous liability accounts that were paid prior to the end of the previous fiscal year. The City reclassified the 2019 Revenue Bond for the police station to the Successor Agency Trust Fund as the debt should have been reported in the Successor Agency Trust Fund. See Note 16 for further details. See the tables below for the prior period adjustments as of July 1, 2021:

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
35 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) R. Prior Period Adjustments (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. 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.

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.

Governmental
Activities
Federal Sewer Refuse Transit Internal
WWTP Fund Fund Fund Fund Service Fund
Net Position July 1, 2021 as orginally stated 6,577,552 $ 4,514,868 $ 1,665,197 $ 58,254 $ - $ Operating grant recorded in error - - - (34,159) -
Right to Use Lease Building Cost 63,385 63,385 63,385 - 63,385 Accumulated Amortization (39,771) (39,771) (39,771) - (39,771) Lease Payable (29,916) (29,916) (29,916) - (29,916)
Net Position July 1, 2021 as restated 6,571,250 4,508,566 1,658,895 24,095 (6,302) Proprietary Funds

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
36 NOTE 2 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (CONTINUED) A. General Budget Policies (Continued)

5. 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.

6. 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.

7. 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.

8. 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.

9. 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.

10. 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.

11. 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.

12. 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.

13. 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, 2022, 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.

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
37 NOTE 2 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (Continued) B. Deficit Fund Balances/Net Position
The following funds contained deficit fund balances/net position as of June 30, 2022:

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

C. Excess of Expenditures over Appropriations
Excess of expenditures over appropriations in departments/cost centers of individual funds:

Major Governmental Fund:

WWTP Special Revenue Fund $ 134,590
Nonmajor Governmental Fund:

Landscape Assessment District 100,810
Major Proprietary Fund:

Transit 408,838
Internal Service Fund: 5,890
Final
Expenditures Appropriations Excess
Major Governmental Funds
General Fund
General government 1,516,628 $ 1,387,959 $ (128,669) $
Public works 1,108,598 1,099,928 (8,670)
Community development 797,458 670,036 (127,422)
Capital outlay 1,066,045 1,032,120 (33,925)
Principal 7,162 - (7,162)
WWTP
Principal 72,581 69,000 (3,581)
Interest and fiscal charges 58,529 - (58,529)
Nonmajor Governmental Funds
TDA
Capital outlay 157,800 - (157,800)
Asset forfeiture
Public safety 14,199 12,049 (2,150)
Principal 3,581 - (3,581)
Interest and fiscal charges 919 - (919)
Crime prevention
Public safety 278,766 272,309 (6,457)

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
38 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, 2022, consisted of the following:

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.

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

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
39 NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
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.

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:

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
Remaining Maturity (in Months)
12 Months 13 to 24 25 to 60
Investment Type or Less Months Months Total
State Investment Pool (LAIF) 7,337,504 $ - $ - $ 7,337,504 $ PARS Investment Pool 2,623,865 - - 2,623,865
Certificates of Deposit 729,378 799,053 2,444,554 3,972,985 Mutual Funds 354,424 - - 354,424
U.S. Agency Securities - - 1,403,340 1,403,340
Total 11,045,171 $ 799,053 $ 3,847,894 $ 15,692,118 $

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
40 NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization.

Presented below is the minimum rating required by (where applicable) the California Government Code, 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, 2022, 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.

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, 2022, 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, 2022, 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:

S&P Rating
Minimum Exempt From
Investment Type Amount Legal Rating Disclosure AAA AA+ A Not Rated State Investment Pool (LAIF) 7,337,504 $ N/A - $ - $ - $ - $ 7,337,504 $ PARS Investment Pool 2,623,865 N/A - - - - 2,623,865
Certificates of Deposit 3,972,985 N/A - - - - 3,972,985 Mutual Funds 354,424 AAA - 354,424 - - -
U.S. Agency Securities 1,403,340 N/A - - 1,403,340 - -
Total 15,692,118 $ - $ 354,424 $ 1,403,340 $ - $ 13,934,354 $

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
41 NOTE 3 – CASH AND INVESTMENTS (CONTINUED)
Custodial Credit Risk (Continued)
Investment Type Reported Amount
U.S. Agency Securities $1,403,340
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.

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, 2022:

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 3,972,985 $ - $ 3,972,985 $ - $ Mutual funds 354,424 354,424 - -
US Government Agency Securities 1,403,340 - 1,403,340.00 - Total Investments Measured at Fair Value 5,730,749 354,424 $ 5,376,325 $ - $ Investments Measured at Amortized Cost
LAIF 7,337,504
PARS 2,623,865
Total Pooled Investments 15,692,118 $

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
42 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, 2022, the balance of notes receivable was $3,436,561 of this amount, $3,436,561 are deferred housing notes, which are due when the properties are transferred. These notes are collateralized by the titles of the properties. These notes carry interest rates between 1% to 5%. All the notes are deferred inflows - unavailable 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, 2022, the loan receivable balance was $1,588,959 with an allowance of $1,588,959 for a net loan receivable of $0.

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, 2022, are as follows:

Transfers In Transfers Out
Major Governmental Funds:

General 50,133 $ - $
Revolving Loan Fund CDBG - 17,133
WWTP Special Revenue - 131,200
WWTP Capital Projects 131,200 -
Nonmajor Governmental Fund:

Traffic Safety - 33,000
Total interfund transfers 181,333 $ 181,333 $

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
43 NOTE 6 – INTERFUND ACTIVITIES (CONTINUED)
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, 2022.

Interfund balances that are not expected to be repaid shortly after the end of the fiscal year are classified as advances to/from. These amounts will be repaid in future years when the WWTP proprietary fund is closed down and the City receives Transportation Development Act reimbursements. It is anticipated that the General Fund and Transit Fund will be fully funded no later than the fiscal year ended June 30, 2026.

Due from Due to
(Receivable) (Payable)
Major Governmental Funds:

WWTP Special Revenue - $ 430,369 $
Major Proprietary Fund:

CCF 260,154 -
Federal WTTP 317,513 -
Nonmajor Governmental Funds:

TDA - 47,418
Landscape Assessment District - 99,880
Total 577,667 $ 577,667 $
Advance to Advance from
(Receivable) (Payable)
Major Governmental Funds:

General - $ 1,819,682 $
Major Proprietary Fund:

Transit - 1,813,989
Federal WTTP 3,633,671 -
Total 3,633,671 $ 3,633,671 $

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
44 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, 2022.

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

Balance Prior Period Balance
Governmental Activities July 1, 2021 Additions Deletions Transfers Adjustment June 30, 2022 Capital assets not being depreciated:

Land 1,359,206 $ 69,304 $ - $ 21,652 $ - $ 1,450,162 $
Construction in progress 53,385 468,908 - - - 522,293
Total capital assets not being depreciated 1,412,591 538,212 - 21,652 - 1,972,455 Capital assets being depreciated/amortized:

Structures and improvements 15,114,795 707,081 (775,481) (21,652) - 15,024,743 Machinery and equipment 4,044,756 247,317 (91,075) - - 4,200,998 Infrastructure:

Roadway system 7,956,169 - - - - 7,956,169
Bridges 265,183 - - - - 265,183
Right to Use Buildings - - - - 316,926 316,926
Total capital assets being depreciated
or amortized 27,380,903 954,398 (866,556) (21,652) 316,926 27,764,019 Less accumulated depreciation
and amortization for:

Structures and improvements (7,616,175) (550,133) 86,077 - (68,400) (8,148,631) Machinery and equipment (3,379,739) (249,948) 91,075 - - (3,538,612) Infrastructure:

Roadway system (3,421,700) (320,100) - - - (3,741,800)
Bridges (265,183) - - - - (265,183)
Right to use buildings - (15,846) - - (198,867) (214,713) Total accumulated depreciation/amortization (14,682,797) (1,136,027) 177,152 - (267,267) (15,908,939) Total capital assets, being depreciated
or amortized net of accumulated
depreciation/amortization 12,698,106 (181,629) (689,404) (21,652) 49,659 11,855,080 Total Governmental activities capital assets,
net of accumulated depreciation or
amortization 14,110,697 $ 356,583 $ (689,404) $ - $ 49,659 $ 13,827,535 $ General government 451,007 $
Public safety 171,687
Public works 510,118
Community development 3,215
Total depreciation/amortization expense - governmental activities 1,136,027 $

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
45 NOTE 7 – CAPITAL ASSETS AND DEPRECIATION (CONTINUED) Changes in business-type activities capital assets:

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

Balance Deletions Prior Period Balance
Business-type activities July 1, 2021 Additions and Reclasses Adjustment June 30, 2022 Capital assets not being depreciated:

Land 11,850 $ - $ - $ - $ 11,850 $
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 2,419,234 - 24,565 - 2,443,799
Sewer infrastructure 2,908,733 - (24,565) - 2,884,168
Right to use buildings - - - 190,155 190,155
Total capital assets being depreciated 12,774,109 - - 190,155 12,964,264 Less accumulated depreciation
and amortization for:

Structures and improvements (4,794,079) (222,414) - - (5,016,493) Machinery and equipment (1,792,454) (188,838) - - (1,981,292) Sewer infrastructure (1,935,818) (72,238) - - (2,008,056) Right to use buildings - (9,507) - (119,313) (128,820)
Total accumulated depreciation (8,522,351) (492,997) - (119,313) (9,134,661) Total capital assets, being depreciated,
net of accumulated depreciation 4,251,758 (492,997) - 70,842 3,829,603 Total Business-type activities capital assets,
net of accumulated depreciation 4,263,608 $ (492,997) $ - $ 70,842 $ 3,841,453 $ CCF 21,415 $
Federal WWTP 240,274
Sewer 76,831
Refuse 26,637
Transit 127,840
Total depreciation expense - business-type activities 492,997 $

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
46 NOTE 8 – GOVERNMENTAL ACTIVITIES LONG-TERM LIABILITIES During the fiscal year ended June 30, 2022, the following changes occurred to the governmental activities longterm 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 $3,223,000 as of June 30, 2022.

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
47 NOTE 8 – GOVERNMENTAL ACTIVITIES LONG-TERM DEBT (CONTINUED) Certificates of Participation maturity schedule:
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 long-term 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.

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 determined that the 2019 revenue bonds were an expense of the Successor Agency Trust Fund during the year and recorded a prior period adjustment.

See Note 16 for the debt reported as part of the Successor Agency Trust Fund.

Fiscal Year
Ended June 30 PRINCIPAL INTEREST TOTAL
2023 70,000 $ 56,403 $ 126,403 $
2024 71,000 55,178 126,178
2025 73,000 53,935 126,935
2026 74,000 52,657 126,657
2027 75,000 51,362 126,362
2028-2032 397,000 236,583 633,583
2033-2037 431,000 200,690 631,690
2038-2042 472,000 161,577 633,577
2043-2047 514,000 118,825 632,825
2048-2052 560,000 72,275 632,275
2053-2056 486,000 21,490 507,490
Total $ 1,080,975 3,223,000 $ 4,303,975 $

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
48 NOTE 8 – GOVERNMENTAL ACTIVITIES LONG-TERM DEBT (CONTINUED) 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 $277,000 as of June 30, 2022.
333 Commerce Way Lease Payable
On January 1, 2009, the City entered into a lease agreement for the rental of the building at 333 Commerce Way in the City of Taft. The lease agreement initial term ended on December 31, 2013, with rental payments of $2,000 for the first year and rental payments of $3,000 for the remaining term of the lease agreement. In July 2011, the City signed an addendum to the lease agreement to extend the lease beginning on January 1, 2014 for another fifteen years to end on December 31, 2028, with monthly rental payments of $3,000 for the extended term. The City has the right to cancel the lease beginning on December 31, 2018. Upon notice of cancellation by the City, the City shall have 180 days to provide a qualified tenant to assume the remaining lease period subject to approval by the landlord. If a qualified tenant cannot be found within this time the City may then terminate the lease and pay a lump sum lease buy-out fee amounting to twelve months of lease payments which currently would total $36,000.

The City has no plans to exercise their termination option. 333 Commerce Way Payable 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.

Fiscal Year
Ended June 30 PRINCIPAL INTEREST TOTAL
2023 18,495 $ 4,006 $ 22,501 $
2024 19,104 3,396 22,500
2025 19,735 2,765 22,500
2026 20,386 2,114 22,500
2027 21,058 1,442 22,500
2028-2029 32,896 852 33,748
Total $ 14,575 131,674 $ 146,249 $

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
49 NOTE 9 – BUSINESS-TYPE ACTIVITIES LONG-TERM DEBT
During the fiscal year ended June 30, 2022, the following changes occurred to the business-type activities longterm 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.

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 nonduty 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.

The Plans’ provisions and benefits in effect on June 30, 2022, are summarized as follows:

Business type activities Balance Prior Period Balance Due in Direct Borrowings July 1, 2021 Adjustment Additions Deletions June 30, 2022 One Year 333 Commerce Way Lease - $ 89,748 $ - $ (10,744) $ 79,004 $ 11,097 $ Total Leases payable - 89,748 - (10,744) 79,004 11,097
Compensated absences 68,470 - 5,575 - 74,045 18,512
Total business-type activities 68,470 $ 89,748 $ 5,575 $ (10,744) $ 153,049 $ 29,609 $ 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% 10.000% Required employer contribution rates 16.636% 13.540% 10.260% City Safety Plan

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
50 NOTE 10 – PENSION PLAN (CONTINUED)
A. General Information about the Pension Plan (Continued) 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, 2022, the contributions recognized as part of pension expense for the combined plan was $1,383,788.

B. Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions As of June 30, 2022, the City reported net pension liability for its proportionate share of the net pension liability in the amount of $7,053,422.

The City’s net pension liability is measured as the proportionate share of the net pension liability. The net pension liability is measured as of June 30, 2021, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2020, rolled forward to June 30, 2021, 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, 2020, and 2021 was as follows:

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% 6.75%
Required employer contribution rates 10.340% 7.590%
City Miscellaneous Plan
Proportion - June 30, 2020 0.10840%
Proportion - June 30, 2021 0.13040%
Change - Increase 0.02200%

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
51 NOTE 10 – PENSION PLAN (CONTINUED)
B. Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions For the fiscal year ended June 30, 2022, the City recognized pension expense of $3,503,879. On June 30, 2022, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

The City reported $1,220,368 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, 2023. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:

Deferred Outflows Deferred Inflows
of Resources of Resources
Difference between expected and actual
experience 1,443,724 $ - $
Changes of employer's proportions 413,953
Net difference between projected and actual
earnings on pension plan investments (6,645,959)
Changes in proportion and differences
between City contributions and
proportionate share of contributions (514,917)
City contributions subsequent to the
measurement date 1,220,368
$ (7,160,876) 3,078,045 $
Fiscal Year Ended
June 30
2023 (933,150) $
2024 (1,113,876)
2025 (1,423,899)
2026 (1,832,274)

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
52 NOTE 10 – PENSION PLAN (CONTINUED)
B. Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
Actuarial Assumptions - The total pension liabilities in the June 30, 2020 actuarial valuations were determined using the following actuarial assumptions:
*The mortality table used was developed based on CalPERS’ specific data. The table includes 15 years of mortality improvements using the Society of Actuaries Scale MP-2020.

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 longterm 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 Valuation Date June 30, 2020
Measurement Date June 30, 2021
Actuarial Cost Method Entry-Age Normal Cost Method
Actuarial Assumptions:

Discount Rate 7.15%
Inflation 2.50%
Payroll Growth 2.75
Salary increases** Varies by entry Age and Service
Investment Rate of Return 7.15%
Mortality* Derived using CalPERS'
Membership Data for all
Funds

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
53 NOTE 10 – PENSION PLAN (CONTINUED)
B. Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
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. (a) An expected inflation of 2.00% was used for this period. (b) An expected inflation of 2.92% was used for this period.

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.

Assumed
Asset Real Return Real Return
Asset Class Allocation Years 1 - 10 (a) Years 11+ (b)
Public 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%
Real Estate 13.00% 3.75% 4.93%
Liquidity 1.00% 0.00% -0.92%
Total 100.00%
1% Decrease 6.15%
Net Pension Liability 13,282,399 $
Current Discount Rate 7.15%
Net Pension Liability 7,053,422 $
1% Increase 8.15%
Net Pension Liability 1,918,444 $

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
54 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.

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 through the Local Agency Workers’ Compensation Excess Joint Powers Authority (LAWCX) for the purchase of obtaining

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
55 NOTE 12 – RISK MANAGEMENT (CONTINUED)
Worker’s Compensation
excess coverage. LAWXC provides $4,500,000 coverage limits in excess of the CSJVRMA retained limit of $500,000 and participates in the Public Risk Innovation, Solutions, and Management JPA (PRISM) for coverage in excess of $5 million up to the statutory limit. During the 2021/2022 fiscal year, 51 cities participated in the program.

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 $29,500,000. The CARMA program has 54 members participating in the pooled liability program during the 2021/2022 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, 2022, 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.

Total Assets 150,837,823 $
Total Liabilities 118,663,929 $
Total Retained Earnings 32,173,894
Total Liabilities and Retained Earnings 150,837,823 $
Revenues for Fiscal Year 66,885,024 $
Expenses for Fiscal Year 55,557,907
Change in Net Position 11,327,117 $

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
56 NOTE 14 – FUND EQUITY
Fund Balance – Governmental Funds
As of June 30, 2022, 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
Special
Revenue
WWTP
Capital
Projects
Total Non-major
Governmental
Funds Total
Nonspendable:

Prepaid items $ 93,734 $ - $ - $ - $ - $ - 93,734 $
Total Nonspendable 93,734 - - - - - 93,734

Restricted for:

Streets and roads - - - - - 986,156 9 86,156
Public safety - - - - - 214,194 214,1 94
Pension 2,623,866 - - - - - 2,623,866
Community development - 10,176 63,058 - - 100,771 174 ,005 Capital Projects - WWTP - - - - 4,570,860 - 4,570,860
Total Restricted 2,623,866 10,176 63,058 - 4,570,860 1,301,121 8,569,081

Unassigned (1,284,504) - - (134,590) - (100,810) (1,519,904)

Total Fund Balances $1,433,096 $ 10,176 $ 63,058 $ (134,590) $ 4,570,860 $ 1,200,311 $ 7,142,911

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
57 NOTE 15 – AGREEMENT – JOINT SEWAGE PROJECT
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.

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
58 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, 2022 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, 2022:

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 Balance Balance
July 1, 2021 Additions Deletions June 30, 2022
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 (277,017) (9,978) - (286,995) Total accumulated depreciation (277,017) (9,978) - (286,995) Total capital assets, being depreciated
net of accumulated depreciation 130,099 (9,978) - 120,121 Total Governmental activities capital assets,
net of accumulated depreciation 1,828,262 $ (9,978) $ - $ 1,818,284 $ Balance Prior Period Balance Due in
July 1, 2021 Adjustment Additions Deletions June 30, 2022 One Year 2019 Revenue Refunding Bonds 1,408,000 $ 360,000 $ - $ (264,000) $ 1,504,000 $ 274,000 $ Total long-term liabilities 1,408,000 $ 360,000 $ - $ (264,000) $ 1,504,000 $ 274,000 $

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
59 NOTE 16 – SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY (CONTINUED)
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 City determined that 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 Successor Agency Trust. Accordingly, the Successor Agency Trust increased the opening net deficit by $580,237 as of July 1, 2021. The restatement totaling $580,237 consisted of a decrease in net position of $360,000 for the principal balance related to the lease of the police statement as of June 30, 2021, a decrease of $216,469 in cash for previous year’s payments of interest and principal by the General Fund on the debt, and a decrease in net position for accrued interest of $3,768 as of June 30, 2021.

The City, the aft 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.

CITY OF TAFT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2022
60 NOTE 18 – SUBSEQUENT EVENTS
Management has evaluated events through the date the financial statements were available for issuance. The following events are considered subsequent events for financial statement purposes:

Community Correctional Facility (CCF)
The Community Correctional Facility (CCF), which is accounted for as an enterprise fund, was closed during the fiscal year ended June 30, 2021. The facility historically provided housing and program services to the California Department of Corrections (CDC). During the fiscal year ended June 30, 2024, the City invested approximately $1 million to restore and rehabilitate the facility. The CCF was reopened during that fiscal year and now operates to provide housing for federally charged and federally housed inmates. The reopening of the facility is expected to provide a renewed revenue stream for the City.

Federal Wastewater Treatment Plant (WWTP)
The Federal Wastewater Treatment Plan (WWTP), also reported as an enterprise fund, was closed during the fiscal year ended June 30, 2025. The closure resulted from the termination of the City’s contract with the Federal Bureau of Prisons for the use of the facility. The City has determined that the remaining cash balance within this fund will be transferred to the General Fund to mitigate its negative cash position.

CITY OF TAFT

MAJOR FUND BUDGETARY COMPARISON SCHEDULES
JUNE 30, 2022
61 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.

CITY OF TAFT

SCHEDULE OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE - BUDGET AND ACTUAL

GENERAL FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
Original Budget Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Property taxes $ 1,785,115 1,628,267 $ $ (89,774) 1,695,341 $ Sales taxes 1,425,255 1,425,255 658,241 2,083,496
Other taxes 265,401 536,893 130,816 396,217
Licenses, permits, and fees 417,125 440,859 (124,400) 292,725 Fines and forfeitures 1,715 515 756 2,471
Use of money and property 119,870 394,547 (443,446) (323,576) Intergovernmental 2,439,878 1,066,820 (1,092,140) 1,347,738 Current services charges 383,605 473,990 11,361 394,966 Other 797,345 24,795 970,551 1,767,896
Total revenues 5,991,941 7,635,309 7,657,274 21,965

EXPENDITURES
Current:

General government 1,387,959 1,349,865 (128,669) 1,516,628 Public safety 4,019,888 3,765,704 332,316 3,687,572
Public works 1,099,928 1,200,905 (8,670) 1,108,598
Community development 670,036 790,293 (127,422) 797,458 Capital outlay 1,032,120 595,715 (33,925) 1,066,045
Debt service :

Principal - - (7,162) 7,162
Interest 93,645 93,645 91,807 1,838
Total expenditures 7,796,127 8,303,576 8,185,301 118,275 Excess (deficiency) of revenues
over expenditures (1,804,186) (668,267) (528,027) 140,240

OTHER FINANCING SOURCES (USES)
Transfers in 668,347 1,839,186 (618,214) 50,133
Total other financing sources (uses) 1,839,186 668,347 50,133 (618,214) Net change in fund balance 35,000 80 (477,894) (477,974) Fund balance, beginning of fiscal year 1,910,990 1,910,990 1,910,990 - Fund balance, end of fiscal year 1,945,990 $ 1,911,070 $ 1,433,096 $ (477,974) $ 62 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, 2022
Original
Budget Final Budget
Actual
Amounts
Variance
with Final
Budget
Positive
(Negative)

REVENUES
Use of money and property - $ 70 $ 327 $ 257 $
Intergovernmental 1,222,197 1,222,197 1,092,824 (129,373) Current service charges 47,312 19,820 64,554 17,242
Other - 8,819 - -
Total revenues 1,250,836 1,269,579 1,157,705 (111,874)

EXPENDITURES
Current:

General government 993,699 974,956 932,992 60,707
Debt service:

Principal retirement 69,000 69,000 72,581 (3,581)
Interest and fiscal charges - - 58,529 (58,529)
Total Expenditures 1,043,956 1,062,699 1,064,102 (1,403) Excess (Deficiency) of Revenues
Over Expenditures 206,880 206,880 93,603 (113,277)

OTHER FINANCING SOURCES (USES)
Transfers in 7,000 - - -
Transfers out - - (131,200) (131,200)
Total other financing sources (uses) 7,000 - (131,200) (131,200) Net change in fund balance 213,880 206,880 (37,597) (244,477) Fund balance (deficit), beginning of fiscal year (96,993) (96,993) (96,993) - Fund balance (deficit), end of the fiscal year 116,887 $ 109,887 $ (134,590) $ $ (244,477) 63 6/30/21 6/30/20 6/30/19 6/30/18
FY 21-22 FY 20-21 FY 19-20 FY 18-19
Plan's proportion of the Net
Pension Liability (Asset) 0.1304% 0.1084% 0.1047% 0.1014% Plan's proportionate share of the
Net Pension Liability (Asset) 7,053,422 $ 11,793,149 $ 10,725,745 $ 9,767,575 $ Covered employee payroll*** 6,413,288 $ 6,855,165 $ 6,721,235 $ 6,967,796 $ Plan's proportionate share of the
Net Pension Liability (Asset) as
a percentage of its covered
employee payroll. 109.98% 172.03% 159.58% 140.18%
Plan's fiduciary net position
as a percentage of the Plan's
Total Pension Liability 89.75% 77.54% 77.75% 77.63%
*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 eight years are shown. ***Covered-Employee Payroll 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 Measurement Date*
June 30, 2022

CITY OF TAFT

REQUIRED SUPPLEMENTARY INFORMATION
Cost Sharing Defined Benefit Pension Plan
Last 10 Fiscal Years**
64 1
6/30/17 6/30/16 6/30/15 6/30/14
FY 17-18 FY 16-17 FY 15-16 FY 14-15
Plan's proportion of the Net
Pension Liability (Asset) 0.0985% 0.0966% 0.0926% 0.3110% Plan's proportionate share of the
Net Pension Liability (Asset) 9,771,417 $ 8,359,216 $ 6,358,590 $ 1,953,362 $ Covered employee payroll*** 6,380,226 $ 6,246,307 $ 3,097,235 $ 3,127,348 $ Plan's proportionate share of the
Net Pension Liability (Asset) as
a percentage of its covered
employee payroll. 153.15% 133.83% 205.30% 62.46%
Plan's fiduciary net position
as a percentage of the Plan's
Total Pension Liability 76.64% 74.06% 78.40% 84.31%
Measurement Date*

CITY OF TAFT

REQUIRED SUPPLEMENTARY INFORMATION
June 30, 2022
Cost Sharing Defined Benefit Pension Plan
Last 10 Fiscal Years**
Schedule of Plan's Proportionate Share of the Net Pension Liability and Related Ratios (Continued) 65 FY 20-21 FY 19-20 FY 18-19 FY 17-18
Actuarially Determined Contribution** 1,220,368 $ 1,383,788 $ 1,265,189 $ 1,093,954 $ Contributions in Relation to the
Actuarially Determined Contribution ** 1,220,368 1,383,788 1,265,189 1,093,954 Contribution Deficiency (Excess) - $ - $ - $ - $
Covered Employee Payroll**** 2,957,505 $ 6,413,288 $ 6,855,165 $ 6,721,235 $ Contributions as a Percentage of
Covered Employee Payroll**** 41.26% 21.58% 18.46% 16.28% * 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 financed liabilities.
*** Fiscal year 2015 was the 1st year of implementation, therefore only eight years are shown. ****Covered-Employee Payroll is based on pensionable earnings provided by the employer. GASB 68 defines covered-employee payroll as the total of employees that are provided pensions through the pension plan. If penionsable 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.

Notes to Schedule:

The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2017-18 were from the June 30, 2017 funding valuation reports.

Actuarial Cost Method Entry Age Normal
Amortization Method/Period For details see the June 30, 2020 public funding valuations.

Asset Valuation Method Actuarial Value of Assets. For details, see June 30, 2020 funding valuation report.

Inflation 2.50%
Salary Increases 2.75%
Investment Rate of Return 7.15%
Retirement Age Based on the December 2020 CALPERS' Experience Study.

Mortality Based on the mortality table used based on CalPERS' specific data, The table includes 15 years of mortality improvements using Society of Actuaries Scale MP-2020.

For more details on this table, please refer to the 2020 experience study report.

Schedule of Pension Contributions *

CITY OF TAFT

REQUIRED SUPPLEMENTARY INFORMATION
June 30, 2022
Cost Sharing Defined Benefit Pension Plan
Last 10 Fiscal Years***
66 FY 17-18 FY 16-17 FY 15-16 FY 14-15
Actuarially Determined Contribution** 942,747 $ 883,603 $ 766,472 $ 921,972 $ Contributions in Relation to the
Actuarially Determined Contribution ** 942,747 883,603 766,472 921,972 Contribution Deficiency (Excess) - $ - $ - $ - $
Covered Employee Payroll**** 6,967,796 $ 6,380,226 $ 6,246,307 $ 3,097,235 $ Contributions as a Percentage of
Covered Employee Payroll**** 13.53% 13.85% 12.27% 29.77%

CITY OF TAFT

REQUIRED SUPPLEMENTARY INFORMATION
June 30, 2022
Cost Sharing Defined Benefit Pension Plan
Last 10 Fiscal Years***
Schedule of Pension Contributions * (Continued)
67 68
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69 CITY OF TAFT

MAJOR CAPITAL PROJECT FUND
JUNE 30, 2022
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, 2022
Original
Budget Final Budget
Actual
Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Use of money and property 20,000 $ 5,000 $ (202) $ (5,202) $ Total revenues 20,000 5,000 (202) (5,202)

OTHER FINANCING SOURCES (USES)
Transfers in - - 131,200 131,200
Transfers out (167,255) (152,255) - 152,255
Total other financing sources (uses) (167,255) (152,255) 131,200 283,455 Net change in fund balance (147,255) (147,255) 130,998 278,253 Fund balance, beginning of fiscal year 4,439,862 4,439,862 4,439,862 - Fund balance, end of the fiscal year 4,292,607 $ 4,292,607 $ 4,570,860 $ $ 278,253 70 71

CITY OF TAFT

NON-MAJOR GOVERNMENTAL FUNDS
JUNE 30, 2022

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.

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.

RMRA
This Fund was established to utilize grant funds for transportation projects, particularly for streets and roads.

Inmate
Traffic Gas Welfare
Safety Tax Trust TDA
ASSETS
Cash and investments $ 527,444 358 $ 79,653 $ - $
Receivables:

Accounts 15,873 192 - 157,800
Interest 448 - - -
Notes - - - -
Total assets 550 $ 543,765 $ 79,653 $ 157,800 $

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES, AND FUND BALANCES

LIABILITIES
Accounts payable $ - - $ - $ - $
Accrued payroll - - - -
Due to other funds - - - 47,418
Total liabilities - - - 47,418

DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - - - -

FUND BALANCES
Restricted 550 543,765 79,653 110,382
Unassigned - - - -
Total fund balances (deficits) 550 543,765 79,653 110,382 Total liabilities, deferred inflows
of resources, and fund balances 550 $ 543,765 $ 79,653 $ 157,800 $

CITY OF TAFT

NON-MAJOR GOVERNMENTAL FUNDS

COMBINING BALANCE SHEET
June 30, 2022
Special Revenue Funds
72 Total
Cal Home TARP Landscape Non-Major
Revolving Revolving Asset Assessment Crime Governmental Loan Loan Forfeiture District Prevention RMRA Funds
$ 282 100,703 $ 472 $ - $ 80,672 $ 300,716 $ $ 1,090,300 - - 64,389 - - 30,266 268,520
- 68 74 - 11 477 1,078
- 127,351 - - - - 127,351
$ 282 228,122 $ 64,935 $ - $ 80,683 $ 331,459 $ 1,487,249 $ $ 282 - $ - $ 517 $ 289 $ - $ $ 1,088
- - - 413 10,788 - 11,201
- - - 99,880 - - 147,298
282 - - 100,810 11,077 - 159,587
- 127,351 - - - - 127,351
- 100,771 64,935 - 69,606 331,459 1,301,121
- - - (100,810) - - (100,810)
- 100,771 64,935 (100,810) 69,606 331,459 1,200,311
$ 282 228,122 $ 64,935 $ - $ 80,683 $ 331,459 $ 1,487,249 $ Special Revenue Funds
73 Inmate
Traffic Gas Welfare
Safety Tax Trust TDA

REVENUES
Fines and forfeitures $ - 4,567 $ - $ - $
Use of money and property (6,124) - 80 -
Intergovernmental 211,843 - - 157,800
Current service charges - - - -
Total revenues 4,567 205,719 80 157,800

EXPENDITURES
Current:

Public safety - - - -
Public works - - - -
Capital outlay - - - 157,800
Debt service:

Principal retirement - - - -
Interest and fiscal charges - - - -
Total expenditures - - - 157,800
Excess of revenues
over (under) expenditures 4,567 205,719 80 -

OTHER FINANCING SOURCES (USES)
Transfers out - (33,000) - -
Total other financing sources (uses) (33,000) - - -
Net change in fund balances (28,433) 205,719 80 -
Fund balances (deficits), beginning of fiscal year 28,983 338,046 79,573 110,382 Fund balances (deficits), end of fiscal year 550 $ 543,765 $ 79,653 $ 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, 2022
74 Total
Cal Home TARP Landscape Non-Major
Revolving Revolving Asset Assessment Crime Governmental Loan Loan Forfeiture District Prevention RMRA Funds
$ - - $ - $ - $ - $ - $ $ 4,567
- (918) (825) 3 (16) (6,291) (14,091)
- 34,408 65,500 - 161,285 184,572 815,408
- - - 12,312 - - 12,312
- 33,490 64,675 12,315 161,269 178,281 818,196
- - 14,199 - 278,766 - 292,965
- - - 22,571 - 324,505 347,076
- - - - - - 157,800
- - 3,581 - - - 3,581
- - 919 - - - 919
- - 18,699 22,571 278,766 324,505 802,341
- 33,490 45,976 (10,256) (117,497) (146,224) 15,855
- - - - - - (33,000)
- - - - - - (33,000)
- 33,490 45,976 (10,256) (117,497) (146,224) (17,145)
- 67,281 18,959 (90,554) 187,103 477,683 1,217,456
$ - 100,771 $ 64,935 $ (100,810) $ 69,606 $ 331,459 $ 1,200,311 $ 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, 2022
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Fines and forfeitures 2,097 $ 4,567 $ 2,470 $
Total revenues 2,097 4,567 2,470

OTHER FINANCING SOURCES (USES)
Transfers out (31,268) (33,000) (1,732)
Total other financing sources (uses) (31,268) (33,000) (1,732) Net change in fund balance (29,171) (28,433) 738
Fund balance, beginning of fiscal year 28,983 28,983 -
Fund balance, end of fiscal year (188) $ 550 $ 738 $
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, 2022
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Use of money and property 2,160 $ (6,124) $ (8,284) $
Intergovernmental 223,886 211,843 (12,043)
Total revenues 226,046 205,719 (20,327)

OTHER FINANCING SOURCES (USES)
Transfers out (226,046) - 226,046
Total other financing sources (uses) (226,046) - 226,046 Net change in fund balance - 205,719 205,719
Fund balance, beginning of fiscal year 338,046 338,046 - Fund balance, end of fiscal year 338,046 $ 543,765 $ 205,719 $ 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, 2022
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Use of money and property 65 $ 80 $ 15 $
Total revenues 65 80 15
Fund balance, beginning of fiscal year 79,573 79,573 -
Fund balance, end of fiscal year 79,638 $ 79,653 $ 15 $ 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, 2022
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Intergovernmental 316,073 $ 157,800 $ (158,273) $
Total revenues 316,073 157,800 (158,273)

EXPENDITURES
Capital outlay - 157,800 (157,800)
Total expenditures - 157,800 (157,800)
Excess (deficiency) of revenues over
expenditures 316,073 - (316,073)

OTHER FINANCING SOURCES (USES)
Transfers out (316,073) - 316,073
Total other financing sources (uses) (316,073) - 316,073 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 $ - $ 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, 2022
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Use of money and property 600 $ (825) $ (1,425) $
Intergovernmental 100,251 65,500 (34,751)
Total revenues 100,851 64,675 (36,176)

EXPENDITURES
Current:

Public safety 12,049 14,199 (2,150)
Debt service :

Principal - 3,581 (3,581)
Interest - 919 (919)
Total expenditures 12,049 18,699 (6,650)
Net change in fund balance 88,802 45,976 (42,826)
Fund balance, beginning of fiscal year 18,959 18,959 -
Fund balance, end of fiscal year 107,761 $ 64,935 $ (42,826) $ 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, 2022
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Use of money and property 5 $ 3 $ (2) $
Current service charges 12,269 12,312 43
Total revenues 12,274 12,315 41

EXPENDITURES
Current:

Public works 29,689 22,571 7,118
Total expenditures 29,689 22,571 7,118
Net change in fund balance (17,415) (10,256) 7,159
Fund balance (deficit), beginning of fiscal year (90,554) (90,554) - Fund balance (deficit), end of fiscal year (107,969) $ (100,810) $ 7,159 $ 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, 2022
Final Budget Actual Amounts
Variance with
Final Budget
Positive
(Negative)

REVENUES
Use of money and property 446 $ (16) $ (462) $
Intergovernmental 161,285 161,285 -
Total revenues 161,731 161,269 (462)

EXPENDITURES
Current:

Public safety 272,309 278,766 (6,457)
Total expenditures 272,309 278,766 (6,457)
Excess (deficiency) of revenues
over expenditures (110,578) (117,497) (6,919)

OTHER FINANCING SOURCES (USES)
Transfers in 110,578 - (110,578)
Total other financing sources (uses) 110,578 - (110,578) Net change in fund balance - (117,497) (117,497)
Fund balance, beginning of fiscal year 187,103 187,103 - Fund balance, end of fiscal year 187,103 $ 69,606 $ (117,497) $ 82 83

CITY OF TAFT

PRIVATE-PURPOSE TRUST FUNDS AND CUSTODIAL FUND
JUNE 30, 2022
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.

CUSTIODAL FUND DESCRIPTION
Inmate Custodial Fund
The Inmate Custodial 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.

CITY OF TAFT

COMBINING STATEMENT OF NET POSITION

PRIVATE PURPOSE TRUST FUNDS
JUNE 30, 2022
Capital Projects
Fund
Post RDA Debt
Retirement Fund Total
ASSETS
Cash and investments $ 20,959 - $ $ 20,959
Interest receivable 191 - 191
Accounts receivable 196,422 - 196,422
Capital assets - nondepreciable - 407,116 407,116
Capital assets - being depreciated - 1,698,163 1,698,163 Capital assets - accumulated depreciation - (286,995) (286,995) Total assets 1,818,284 217,572 2,035,856

LIABILITIES
Accounts payable 7 - 7
Accrued payroll 1,126 - 1,126
Accrued interest payable 15,742 - 15,742
Bonds payable due within one year 274,000 - 274,000
Advance due to City of Taft due in more than
one year 1,588,959 - 1,588,959
Bonds payable due in more than one year 1,230,000 - 1,230,000 Total liabilities - 3,109,834 3,109,834

NET POSITION (DEFICIT)
Unrestricted 1,818,284 (2,892,262) (1,073,978)
Total Net Position (Deficit) 1,818,284 $ (2,892,262) $ (1,073,978) $ 84 Capital Projects
Fund
Post RDA Debt
Retirement
Fund Total
Additions:

Investment revenue $ (895) - $ $ (895)
Taxes and assessments 442,632 - 442,632
Total additions - 441,737 441,737
Deductions:

Community development 48,511 - 48,511
Interest expense 50,679 - 50,679
Depreciation - 9,978 9,978
Total deductions 9,978 99,190 109,168
Change in net position (9,978) 342,547 332,569
Net Position (Deficit) - July 1, 2021 1,828,262 (2,654,572) (826,310) Prior period adjustments - (580,237) (580,237)
Net Position (Deficit) , beginning of fiscal year, restated 1,828,262 (3,234,809) (1,406,547) Net Position (Deficit) - June 30, 2022 1,818,284 $ (2,892,262) $ (1,073,978) $

CITY OF TAFT

PRIVATE PURPOSE TRUST FUNDS

COMBINING STATEMENT OF CHANGES IN NET POSITION
FOR THE FISCAL YEAR ENDED JUNE 30, 2022
85 86
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WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS

SANITATION DISTRICT

FINANCIAL STATEMENTS
JUNE 30, 2022

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS

SANITATION DISTRICT

FINANCIAL STATEMENTS
JUNE 30, 2022
Table of Contents
INDEPENDENT AUDITOR’S REPORT ......................................................................................................... 1 BASIC FINANCIAL STATEMENTS:

Government-wide Financial Statements
Statement of Net Position ......................................................................................................................... 4 Statement of Activities ............................................................................................................................. 5 Fund Financial Statements
Balance Sheet – Governmental Funds ...................................................................................................... 6 Reconciliation of the Governmental Funds Balance Sheet
to the Statement of Net Position ..................................................................................................... 7 Statement of Revenues, Expenditures, and Changes in Fund Balances – Governmental Funds .................................................................................................... 8 Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Statement of Activities ................................ 9 Notes to the Basic Financial Statements ............................................................................................................ 10

REQUIRED SUPPLEMENTARY INFORMATION
Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual – Special Revenue Fund ................................................................................... 21

OTHER SUPPLEMENTARY INFORMATION
Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual – Capital Projects Fund .................................................................................... 22 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 CRAIG A HARTZHEIM, CPA 8383 WILSHIRE BLVD., SUITE 800 5800 HANNUM AVE., SUITE E HADLEY Y HUI, CPA BEVERLY HILLS, CA 90211 CULVER CITY, CA 90230 ADAM V GUISE, CPA TEL: 310.670.2745 TEL: 310.670.2745
TRAVIS J HOLE, CPA FAX: 310.670.1689 FAX: 310.670.1689
WILSON LAM, CPA www.mlhcpas.com www.mlhcpas.com
INDEPENDENT AUDITOR’S REPORT
Opinions
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, 2022, and the related notes to the financial statements, which collectively comprise the WWTP’s basic financial statements, as listed in the table of contents.

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and each major fund of the WWTP, as of June 30, 2022, 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.

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

Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. 2 In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
 Exercise professional judgment and maintain professional skepticism throughout the audit.  Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.  Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstance, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control.

Accordingly, no such opinion is expressed.
 Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.  Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the WWTP’s ability to continue as a going concern for a reasonable period of time.

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 21 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.
3 Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report November 20, 2025, 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
November 20, 2025

GOVERNMENT-WIDE FINANCIAL STATEMENTS
ASSETS
Current Assets:

Cash and investments $ 4,914,764
Accounts receivable 587,413
Interest receivable 492
Total Current Assets 5,502,669
Noncurrent Assets:

Capital assets:

Non-depreciable:

Land 32,519
Depreciable, net of accumulated depreciation and amortization 3,420,289 Total Noncurrent Assets 3,452,808
Total Assets 8,955,477

LIABILITIES
Current Liabilities:

Accounts payable 56,182
Accrued payroll 4,925
Accrued interest payable 4,074
Due to City of Taft 430,369
Compensated absences 4,394
Lease payable 3,699
Certificates of participation (COP) payable 70,000
Total Current Liabilities 573,643
Noncurrent Liabilities:

Compensated absences 13,180
Lease payable 22,636
Certificates of participation (COP) payable 3,153,000
Total Noncurrent Liabilities 3,188,816
Total Liabilities 3,762,459

NET POSITION
Net investment in capital assets 203,473
Restricted 4,989,545
Total Net Position 5,193,018 $

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY - TAFT HEIGHTS SANITATION DISTRICT

STATEMENT OF NET POSITION
JUNE 30, 2022
Governmental
Activities
The notes to the basic financial statements are an integral part of this statement. 4 Net
(Expense)/Revenue
and Changes in
Net Position
Governmental
Expenses Activities
Governmental Activities:

General government 1,186,848 $ 64,554 $ 1,161,578 $ - $ 39,284 $ Interest and fiscal charges 58,443 - - - (58,443)
Total Governmental Activities 1,245,291 $ 64,554 $ 1,161,578 $ - $ (19,159) General Revenues:

Investment earnings 125
Total General Revenues 125
Change in Net Position (19,034)
Net Position, Beginning of Fiscal Year, as originally stated 5,218,354 Prior Period Adjustment (6,302)
Net Position, Beginning of Fiscal Year, as restated 5,212,052 Net Position, End of Fiscal Year $ 5,193,018
Function/Program
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, 2022
The notes to the basic financial statements are an integral part of this statement. 5 FUND FINANCIAL STATEMENTS
ASSETS
Cash and investments 4,570,368 $ 344,396 $ 4,914,764 $
Accounts receivable - 587,413 587,413
Interest receivable 492 - 492
Total Assets $ 931,809 4,570,860 $ 5,502,669 $

LIABILITIES AND FUND BALANCES

LIABILITIES
Accounts payable - $ 56,182 $ 56,182 $
Accrued payroll - 4,925 4,925
Due to City of Taft - 430,369 430,369
Total Liabilities - 491,476 491,476

DEFERRED INFLOW OF RESOURCES
Unavailable revenue - 574,923 574,923
Total Deferred Inflow of Resources - 574,923 574,923

FUND BALANCES
Restricted 4,570,860 - 4,570,860
Unassigned - (134,590) (134,590)
Total Fund Balances 4,570,860 (134,590) 4,436,270
Total Liabilities, Deferred Inflow of Resources,
and Fund Balances $ 931,809 4,570,860 $ 5,502,669 $
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, 2022
The notes to the basic financial statements are an integral part of this statement. 6 Fund Balances of Governmental Funds 4,436,270 $
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 the accrued compensated absences. (17,574) Interest on long-term liabilities is not due and payable in the current period and, therefore, not reported in the governmental funds. (4,074)
Certain revenues are unavailable in the governmental funds because the availability criteria has not been met. These revenues are recognized in the statement of net position. 574,923 Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the governmental funds.

Certificates of Participation (3,223,000) $
Lease Payable (26,335) (3,249,335)
Capital assets, net of accumulated depreciation, used in governmental funds are not current financial resources and, therefore, are not reported in the governmental funds. 3,452,808 Net Position of Governmental Activities 5,193,018 $

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, 2022
The notes to the basic financial statements are an integral part of this statement. 7 REVENUES
Intergovernmental - $ 1,092,824 $ 1,092,824 $
Use of money and property (202) 327 125
Charges for services - 64,554 64,554
Total Revenues (202) 1,157,705 1,157,503

EXPENDITURES
Current:

General government - 932,992 932,992
Debt Service:

Principal retirement - 72,581 72,581
Interest and fiscal charges - 58,529 58,529
Total Expenditures - 1,064,102 1,064,102
Excess (Deficiency) of
Revenues Over Expenditures (202) 93,603 93,401

OTHER FINANCING SOURCES (USES)
Transfers in 131,200 - 131,200
Transfers out - (131,200) (131,200)
Total Other Financing Sources (Uses) 131,200 (131,200) - Net Change in Fund Balances 130,998 (37,597) 93,401
Fund Balances (Deficit), Beginning of Fiscal Year 4,439,862 (96,993) 4,342,869 Fund Balances (Deficit), End of Fiscal Year $ (134,590) 4,570,860 $ 4,436,270 $ 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, 2022
The notes to the basic financial statements are an integral part of this statement. 8 Net Change in Fund Balances of Governmental Funds 93,401 $ 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:

Certain revenues are unavailable in the governmental funds because the availability criteria has not been met. These revenues are recognized in the statement of net position. 68,754
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:

Depreciation/amortization expense (252,583)
Interest payable on long-term liabilities is not due and payable in the current period and, therefore, is not recorded in the current period. 86 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 certificates of participation 69,020
Lease payable 3,561
Compensated absences (1,273)
Change in Net Position of Governmental Activities $ (19,034)

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, 2022
The notes to the basic financial statements are an integral part of this statement. 9 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, 2022
10 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 selfbalancing 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.

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2022
11 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.

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2022
12 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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 fiscal 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 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.

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.

2. 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
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 and Amortization
Capital assets, which include land, right to use leased assets, 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 $5,000. Sensitive items with costs below $5,000 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.

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2022
13 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) F. Capital Assets and Depreciation (Continued)
Depreciation of capital assets is charged as an expense against operations each fiscal 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.

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.

I. Due to the City of Taft
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. Amounts due from other funds of the City of Taft are reported separately from interfund balances which comprise only entities reported in these financial statements.

J. Deferred Inflow of Resources
Receivables that are collected after sixty days are considered to be unavailable for payment of current expenditures on the governmental fund statements. When the WWTP meets all of the eligibility requirements other than time, the City records a receivable and an offsetting deferred inflow of resources. These amounts are recognized as revenue on the government-wide statement of net position. The deferred inflows representing the receivable for the other participants of the WWTP total $574,923 as of June 30, 2022.

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2022
14 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) K. New Accounting Pronouncements
GASB Statement Number 87 “Leases” Implementation
Governmental Accounting Standards Board issued Statement No. 87 “Leases” to better meet the information needs of financial statement users by improving accounting and financial reporting for leases by governments.

This statement increases the usefulness of governments’ financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract. It establishes a single model for lease accounting based on the foundational principle that leases are financings of the right to use an underlying asset. Under this Statement a lessee is required to recognize a lease liability and an intangible right to use asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources, thereby enhancing the relevance and consistency of information about governments’ leasing activities. Implementation of GASB No. 87 resulted in the WWTP recognizing opening lease liabilities of $29,916, right to use assets of $63,385 and accumulated amortization of $39,771 as follows as of July 1, 2021. See Note 1L for further information on the prior period adjustment.

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

The provisions of Statement Number 91 “Conduit Debt Obligations” are effective for reporting periods beginning after December 15, 2021.

The provisions of 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 of 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 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.

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2022
15 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) K. New Accounting Pronouncements (Continued)
Future Accounting Standards
The provisions for Statement Number 103 “Financial Reporting Model Improvements” are effective for fiscal years beginning after June 15, 2025.

The provisions for Statement Number 104 “Disclosure of Certain Capital Assets” are effective for fiscal years beginning after June 15, 2025.

L. Prior Period Adjustments
The WTTP implemented the provisions of Governmental Accounting Standards Board Statement No. 87 “Leases” for the fiscal year ending June 30, 2022, resulting in recording opening balance adjustments for a right to use leased building, accumulated amortization on the right to use leased buildings, and a lease payable. See below for the prior period adjustments as of July 1, 2021:

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, 2022. The WWTP’s cash and investments balance at June 30, 2022 is $4,914,764.

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.

Government
Wide
Governmental
Activities
Net Position July 1, 2021 as orginally stated 5,218,354 $ Right to Use Lease Building Cost 63,385
Accumulated Amortization (39,771)
Lease Payable (29,916)
Net Position July 1, 2021 as restated 5,212,052 $

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2022
16 NOTE 3 – CAPITAL ASSETS AND DEPRECIATON
During the fiscal year ended June 30, 2022, the following changes in capital assets occurred:

Depreciation and amortization expense of $252,583 was charged to general government on the Statement of Activities for the fiscal year ended June 30, 2022.

NOTE 4 – INERFUND TRANSFERS
Interfund transfers as of June 30, 2022 were as follows:

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.

Balance Prior Period Balance
Governmental Activities July 1, 2021 Additions Deletions Adjustment June 30, 2022 Capital assets not being depreciated:

Land 32,519 $ - $ - $ - $ 32,519 $
Total capital assets not being depreciated 32,519 - - - 32,519 Capital assets being depreciated/amortized:

Machinery and equipment 233,521 - - - 233,521
Structures and improvements 6,687,207 - - - 6,687,207
Right to Use Buildings - - - 23,614 23,614
Total capital assets being depreciated 6,920,728 - - 23,614 6,944,342 Less accumulated depreciation and amortization for:

Machinery and equipment (224,188) (5,582) - - (229,770) Structures and improvements (3,047,282) (243,832) - - (3,291,114) Right to Use Buildings - (3,169) - - (3,169)
Total accumulated depreciation/amortization (3,271,470) (252,583) - - (3,524,053) Total capital assets, being depreciated or
amortized net of accumulated
depreciation/amortization 3,649,258 (252,583) - 23,614 3,420,289 Total Governmental activities capital assets,
net of accumulated depreciation
or amortization 3,681,777 $ (252,583) $ - $ 23,614 $ 3,452,808 $ Transfers Transfers
Fund In Out
WWTP Capital Projects 131,200 $ - $
WWTP Special Revenue - (131,200)
Total 131,200 $ (131,200) $

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2022
17 NOTE 5 – GOVERNMENTAL ACTIVITIES LONG-TERM LIABILITIES During the fiscal year ended June 30, 2022, the following changes occurred in the governmental long-term liabilities:

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 WWTP via the execution and delivery of certificates of participation.

The WWTP 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 WWTP from the Corporation of the completed Project.

The WWTP 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 WWTP 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 WWTP spent $3,251,654 for the project which was completed in May 2017.

The WWTP 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 WWTP during FY 2017-18. The certificates of participation had an outstanding principal balance of $3,223,000 as of June 30, 2022.

Balance Prior Period Balance Due in
Direct Borrowings July 1, 2021 Adjustment Additions Deletions June 30, 2022 One Year Certificates of Participation $ 3,292,000 $ - $ - $ (69,000) $ 3,223,000 $ 70,000 333 Commerce Way Lease - 29,916 (3,581) 26,335 3,699
Total Certificates and Leases 3,292,000 29,916 - (72,581) 3,249,335 73,699 Compensated Absences 16,301 - 1,273 - 17,574 4,394
Total Long term liabilities $ 3, $ 29,916 308,301 $ 1,273 $ (72,581) $ 3,266,909 $ 78,093

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2022
18 NOTE 5 – GOVERNMENTAL ACTIVITIES LONG-TERM LIABILITIES (CONTINUED) Certificates of Participation (Continued)
Certificates of Participation maturity schedule:
333 Commerce Way
On January 1, 2009, the City entered into a lease agreement for the rental of the building at 333 Commerce Way in the City of Taft. The lease agreement initial term ended on December 31, 2013, with rental payments of $2,000 for the first year and rental payments of $3,000 for the remaining term of the lease agreement. In July 2011, the City signed an addendum to the lease agreement to extend the lease beginning on January 1, 2014 for another fifteen years to end on December 31, 2028, with monthly rental payments of $3,000 for the extended term. The City has the right to cancel the lease beginning on December 31, 2018. Upon notice of cancellation by the City, the City shall have 180 days to provide a qualified tenant to assume the remaining lease period subject to approval by the landlord. If a qualified tenant cannot be found within this time the City may then terminate the lease and pay a lump sum lease buy-out fee amounting to twelve months of lease payments which currently would total $36,000.

The City has no plans to exercise their termination option. 333 Commerce Way Payable schedule:

Fiscal year ending
June 30, Principal Interest Total
2023 $ 70,000 $ 56,403 $ 126,403
2024 71,000 55,178 126,178
2025 73,000 53,935 126,935
2026 74,000 52,657 126,657
2027 75,000 51,363 126,363
2028-2032 397,000 236,582 633,582
2033-2037 431,000 200,690 631,690
2038-2042 472,000 161,577 633,577
2043-2047 514,000 118,825 632,825
2048-2052 560,000 72,275 632,275
2053-2056 486,000 21,490 507,490
Totals $ 3,223,000 $ 1,080,975 $ 4,303,975
Certificates of Participation
Fiscal year ending
June 30, Principal Interest Total
2023 $ 3,699 $ 801 $ 4,500
2024 3,821 679 4,500
2025 3,947 553 4,500
2026 4,077 423 4,500
2027 4,212 288 4,500
2028-2029 6,580 171 6,751
Total $ 26,336 $ 2,915 $ 29,251
333 Commerce Way

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2022
19 NOTE 5 – GOVERNMENTAL ACTIVITIES LONG-TERM LIABILITIES (CONTINUED) Compensated Absences
Compensated absences are determined to be the amount due to employees for future absences, which are 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 7 – NET POSITION/FUND BALANCES
Net position is divided into three captions. These captions apply to net position as determined at the governmentwide 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.

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 of 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.

WASTEWATER TREATMENT PLANT

CITY OF TAFT / FORD CITY-TAFT HEIGHTS SANITATION DISTRICT

NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2022
20 NOTE 7 – NET POSITION/FUND BALANCES (CONTINUED)

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.

NOTE 8 – DEFICIT FUND BALANCE
The WWTP Special Revenue Fund has a negative fund balance of $134,590 as of June 30, 2022. The WWTP anticipates that future revenue will be sufficient to cover these deficits.

REQUIRED SUPPLEMENTARY INFORMATION
Original Final

REVENUES
Intergovernmental 1,222,197 $ 1,222,197 $ 1,092,824 $ (129,373) $ Use of money and property - 70 327 257
Charges for services 19,820 47,312 64,554 17,242
Other 8,819 - - -
Total Revenues 1,250,836 1,269,579 1,157,705 (111,874)

EXPENDITURES
Current:

General government 974,956 993,699 932,992 60,707
Debt service:

OTHER FINANCING SOURCES (USES)
Transfers in 7,000 - - -
Transfers out - - (131,200) (131,200)
Total other financing sources (uses) 7,000 - (131,200) (131,200) Net Change in Fund Balance 213,880 206,880 (37,597) (244,477) Fund Balance (Deficit), Beginning of Fiscal year (96,993) (96,993) (96,993) - Fund Balance (Deficit), End of the Fiscal Year 116,887 $ 109,887 $ (134,590) $ (244,477) $

WASTEWATER TREATMENT PLANT
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, 2022
21 OTHER SUPPLEMENTARY INFORMATION
Original Final

REVENUES
Use of money and property 20,000 $ 5,000 $ (202) $ (5,202) $ Total Revenues 20,000 5,000 (202) (5,202)

OTHER FINANCING SOURCES (USES)
Transfers in - - 131,200 131,200
Transfers out (152,255) (167,255) - 152,255
Total Other Financing Sources (Uses) (167,255) (152,255) 131,200 283,455 Net Change in Fund Balance (147,255) (147,255) 130,998 278,253 Fund Balance, Beginning of Fiscal Year 4,439,862 4,439,862 4,439,862 - Fund Balance, End of Fiscal Year 4,292,607 $ 4,292,607 $ 4,570,860 $ 278,253 $ 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, 2022
Budgeted Amounts
22 WASTEWATER TREATMENT PLANT

CITY OF TAFT/FORD CITY-TAFT HEIGHTS

SANITATION DISTRICT

MANAGEMENT REPORT
AND
AUDITOR’S COMMUNICATION LETTER
June 30, 2022

WASTEWATER TREATMENT PLANT

CITY OF TAFT/FORD CITY-TAFT HEIGHTS

SANITATION DISTRICT
June 30, 2022

TABLE OF CONTENTS
Required Communication under Statement on Auditing Standards No. 114 .......................... 1 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 ................................................................................................................... 4 Current Year Recommendations .................................................................................................. 6 Status of Prior Year Recommendations ....................................................................................... 7 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

November 20, 2025
To the City Council
City of Taft, California
We have audited the 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 WTTP) for the fiscal year ended June 30, 2022. Professional standards require that we provide you with the information about our responsibilities under auditing standards generally accepted in the United States of America and Government Auditing Standards, as well as certain information related to the planned scope and timing of our audit. We have communicated such information to you in a previous letter.

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 WWTP are described in Note 1 to the financial statements. As described in Note 1K to the financial statements, the City adopted Governmental Accounting Standards Statement No. 87 “Leases” in the fiscal year ending June 30, 2022. Accordingly, the cumulative effect of the accounting change as of the beginning of the fiscal year is reported in the Government Wide Statement of Activity. 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 of the historical cost and useful lives of certain capital assets and right to use leased assets are based on historical data and industry guidelines. We evaluated the key factors and assumptions used to develop these estimates and determined that they are reasonable in relation to the financial statements taken as a whole.

The financial statement disclosures are neutral, consistent, and clear. 2 Difficulties Encountered in Performing the Audit
Due to significant turnover in WWTP personnel, we encountered significant delays in obtaining the information needed to complete the audit in a timely fashion.

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.

Management has corrected all such misstatements. In addition, none of the misstatements detected as a result of audit procedures and corrected by management were material, either individually or in the aggregate to each opinion unit’s financial statements taken as a whole.

Disagreements with Management
For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the 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 November 20, 2025.

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 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – Special Revenue Fund which is required supplementary information (RSI) that supplement the basic financial statements. Our procedures consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI.
3 We were engaged to report on the WWTP Capital Projects Fund budgetary comparison schedule which accompanies the financial statements but are not RSI. With respect to this supplementary information, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves.

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

Very truly yours,

MOSS, LEVY & HARTZHEIM, LLP
Culver City, CA
November 20, 2025
4 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 AVE., SUITE E HADLEY Y HUI, CPA BEVERLY HILLS, CA 90211 CULVER CITY, CA 90230 ADAM V GUISE, CPA TEL: 310.670.2745 TEL: 310.670.2745
TRAVIS J HOLE, CPA FAX: 310.670.1689 FAX: 310.670.1689
WILSON LAM, CPA www.mlhcpas.com www.mlhcpas.com
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 City Council
City of 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 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, 2022, and the related notes to the financial statements, which collectively comprise the WWTP’s basic financial statements, and have issued our report thereon dated November 20, 2025.

Report on Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the WWTP’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 opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of WWTP’s internal control. Accordingly, we do not express an opinion on the effectiveness of WWTP’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. We did identify a certain deficiency in internal control, described in the accompanying schedule of findings as item 2022-001 that we consider to be a material weakness. 5 Compliance and Other Matters
As part of obtaining reasonable assurance about whether the WWTP’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 no instances of noncompliance that are required to be reported under Government Auditing Standards.

WWTP’s Response to Findings
The WWTP’s response to the findings identified in our audit are described in the accompanying schedule of findings. The WWTP’s responses were not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it.

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

Very truly yours,

MOSS, LEVY & HARTZHEIM, LLP
Culver City, CA
November 20, 2025

WASTEWATER TREATMENT PLANT OF THE

CITY OF TAFT/FORD CITY-TAFT HEIGHTS

SANITATION DISTRICT
June 30, 2022
6 CURRENT YEAR FINDINGS

MATERIAL WEAKNESS
2022-001 The WWTP’s closing process was not completed timely resulting in audited financial statements that were not completed timely.

Criteria:

The WWTP’s closing process should be completed within six months of fiscal year end in order to allow for the completion of the audited financial statements and single audit (as necessary) within nine months of the fiscal year end and allow for current and relevant information.

Condition:

The WWTP’s closing process was not completed within six months of the end of the fiscal year.

Effect:

Completing the closing process and issuing audited financial statements and a single audit in a timely manner helps assist the City in maintaining proper internal controls over operations and in compliance with laws.

Recommendation:

We recommend that the WWTP complete the closing process within six months of the fiscal year end and to issue audited financial statements within nine months of the fiscal year end.

Management’s response:

The WWTP has experienced significant turnover and understaffing in its Finance Department. To alleviate this, an outside financial consultant has been hired to assist with the closing process and other finance department responsibilities. Beginning in the 2024-2025 fiscal year, the WWTP’s financial records will be closed timely.

WASTEWATER TREATMENT PLANT OF THE

CITY OF TAFT/FORD CITY-TAFT HEIGHTS

SANITATION DISTRICT
June 30, 2022
7 STATUS OF PRIOR YEAR FINDINGS
2021-001 The City’s closing process was not completed timely resulting in audited financial statements that were not completed timely.

Condition:

The City’s closing process was not completed within six months of the end of the fiscal year.

Effect:

Completing the closing process and issuing audited financial statements in a timely manner helps assist the City in maintaining proper internal controls over operations.

Status:

Repeat finding for 2021-2022 fiscal year. See finding 2022-001 for further information.

REVIEWED BY:

CITY CLERK FINANCE DIRECTOR CITY MANAGER
City of Taft Agenda Report
DATE: MARCH 3, 2026
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:

FINANCE AND HUMAN RESOURCE STAFF TO ATTEND TYLER MUNIS 2026 ANNUAL TRAINING IN LAS VEGAS, NEVADA, TO BE HELD ON APRIL 7 – 10, 2026 SUMMARY STATEMENT:

The City of Taft acknowledges the value of professional seminars, conferences, training and meetings and recognizes the need for City employees to travel outside the City to conduct City business. It is the intent of the City to provide travel and expense funds for reasonable expenses incurred in the course of such travel. The City of Taft Personnel Policies and Procedures Manual outlines the Travel Policy for City employees. Travel locally and within the state of California for seminars and conferences may be approved by the City Manager, but outside of the state requires City Council approval.

Staff would like to attend Tyler Connect 2026 April 7-10 in Las Vegas, Nevada, where we will have the opportunity to discover new ways to boost productivity and improve our services by getting the most from using our Munis solutions. This would be a great opportunity for our staff to obtain quality training and to become familiar with the upcoming changes including implementing the new employee self-serve and other new features that will be included in the upgrade. Within the finance staff there will be three employees. These employees have worked with the City for two years or less and have used the financial software daily and desire the opportunity to perfect their skills. Also accompanying the finance staff will be the Human Resource Analyst.

RECOMMENDED ACTION
Motion to approve funds from capital reserves of $1,000, for Human Resources and to approve the out of state travel for Finance and HR employees to attend Tyler Connect 2026 training in Las Vegas, Nevada from April 7 – 10th, 2026.

IMPACT ON BUDGET (Y/N): Yes, increase in Human Resources training budget of $1,000.

ATTACHMENT (Y/N): No
PREPARED BY: Teresa Binkley, Finance Director
REVIEWED BY:

CITY CLERK FINANCE DIRECTOR CITY MANAGER
City of Taft Agenda Report
DATE: MARCH 3, 2026
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
AGENDA MATTER:

TYLER MUNIS AGREEMENT FOR CLOUD SERVICES
SUMMARY STATEMENT:

Reviewing the future needs in operating the City’s Financial and Human Resource operating systems, which requires currently several separate servers to run different functions of the software. In comparing cost of maintaining and replacing servers’ which with current estimated cost for purchasing and the expense to have them installed at $150,000 or more depending on the time of purchase and having to replace these servers every 3 to 4 years, verses moving over to the cloud and paying for Tyler’s cloud services.

By making this change the city is also going to take cost saving measures such as adding Employee SelfServe that will allow employees to choose not to have their check stubs printed and access them through an employee access website which will reduce the cost of printing. They can also access their prior W-2’s, make changes to their W-4’s and as we move through the upgrade process, eventually once installed the software will process from the application submittal through onboarding. Which will save staff time manually tracking paperwork.

Once the City’s financial records are moved over, then the plan is to add the additional modules, Advance Scheduling (TCCF and PD use) and Time and Attendance for citywide (Electronic Timecards) which will help assist management in scheduling staff and the cost saving from purchasing printed timecards. The current servers will be evaluated to see if they can be repurposed at other locations to help with additional savings. Additional benefits to moving to cloud services, Tyler will perform nightly backup services, and automatic upgrades. With this Munis upgrade and moving to the cloud services, the city has included in the agreement the cost of these modules, but the city will not be billed for these modules until they are fully installed and working.

The current annual software cost for maintenance and license fees was $52,200 and estimated cost for FY2026-2027 if we choose to continue to host will be $54,810 (5% increase annually), plus the additional cost to replace the servers. The last time the servers were upgraded was from using COVID funds in FY2021- 2022.

Staff is proposing to have council approve the attached agreement to move to Tyler cloud services at a cost of $41,781 for a one-time cost, and for an annual fee of $116,415, or at a prorated amount if all proposed modules are not completed within the FY2026-2027.

RECOMMENDED ACTION
Motion to authorize the Mayor to execute the agreement with Tyler Technologies for Cloud Services.

IMPACT ON BUDGET (Y/N): No, will be Budgeted in FY2026-27 Budget ATTACHMENT (Y/N): No
PREPARED BY: Teresa Binkley, Finance Director
1 SOFTWARE AS A SERVICE AGREEMENT
This Software as a Service Agreement is made between Tyler Technologies, Inc. and Client.

WHEREAS, Client selected Tyler to provide certain products and services set forth in the Investment Summary, including providing Client with access to Tyler’s proprietary software products, and Tyler desires to provide such products and services under the terms of this Agreement; NOW THEREFORE, in consideration of the foregoing and of the mutual covenants and promises set forth in this Agreement, Tyler and Client agree as follows:

SECTION A – DEFINITIONS
• “Agreement” means this Software as a Service Agreement. • “Business Travel Policy” means our business travel policy. Our current Business Travel Policy is available here: https://www.tylertech.com/portals/0/terms/Tyler-Business-Travel-Policy.pdf. • “Client” means the party indicated on the signature block or, in the absence of a signature block, the Investment Summary.
• “Data” means your data necessary to use the Tyler Software. • “Data Storage Capacity” means the contracted amount of storage capacity for your Data, if any, identified in the Investment Summary.
• “Defect” means a failure of the Tyler Software to substantially conform to the functional descriptions set forth in our written proposal to you (or the Documentation in the absence of a written proposal), or their functional equivalent. Future functionality may be updated, modified, or otherwise enhanced through our maintenance and support services, and the governing functional descriptions for such future functionality will be set forth in our thencurrent Documentation. • “Defined Users” means the number of users, if any, that are identified in the Investment Summary. If Exhibit A contains Enterprise Permitting & Licensing labeled software, defined users mean the maximum number of named users that are authorized to use the Enterprise Permitting & Licensing labeled modules as indicated in the Investment Summary. • “Developer” means a third party who owns the intellectual property rights to a Third-Party Product.
• “Documentation” means any online or written documentation related to the use or functionality of the Tyler Software that we provide or otherwise make available to you, including instructions, user guides, manuals and other training or self-help documentation. • “Effective Date” means the date by which both your and our authorized representatives have signed the Agreement. Notwithstanding the foregoing, if these terms are linked from an Order Form, the Effective Date is the date your authorized representative signed the Order Form. • “Force Majeure” means an event beyond the reasonable control of you or us, including, without limitation, governmental action, war, riot or civil commotion, fire, natural disaster, or any other cause that could not with reasonable diligence be foreseen or prevented by you or us. • “Investment Summary” means the agreed upon cost proposal for the products and services attached as Exhibit A.
2 • “Order Form” means an ordering document that includes a quote or investment summary and specifies the items to be provided by Tyler to Client, including any addenda and supplements thereto.
• “Professional Services” means those services provided by Tyler or a third party related to the scope of this Agreement and identified in the Investment Summary. • “SaaS Fees” means the fees for the SaaS Services identified in the Investment Summary. • “SaaS Services” means software as a service consisting of system administration, system management, and system monitoring activities that Tyler performs for the Tyler Software and includes the right to access and use the Tyler Software, receive maintenance and support on the Tyler Software, including Downtime resolution under the terms of the SLA, and Data storage and archiving. SaaS Services do not include support of an operating system or hardware, support outside of our normal business hours, or training, consulting, or other professional services. • “SLA” means the service level agreement. A copy of our current SLA is attached hereto as Exhibit C.
• “Support Call Process” means the support call process applicable to all our customers who have a right to use the Tyler Software. Our current Support Call Process is available here:
https://www.tylertech.com/portals/0/terms/Tyler-Support-Call-Process.pdf. • “Third-Party Hardware” means the third-party hardware, if any, identified in the Investment Summary.
• “Third-Party Products” means the Third-Party Software and Third-Party Hardware. • “Third-Party SaaS Services” means software as a service provided by a third party, if any, identified in the Investment Summary.
• “Third-Party Services” means the third-party services, if any, identified in the Investment Summary.
• “Third-Party Software” means the third-party software, if any, identified in the Investment Summary or included with the Tyler Software.
• “Third-Party Terms” means the end user license agreement(s) or other terms, if any, for the Third-Party Products or other parties’ products or services, as applicable, and attached or indicated at Exhibit D.
• “Tyler” means Tyler Technologies, Inc., a Delaware corporation. • “Tyler Software” means our proprietary software, including any integrations, custom modifications, and/or other related interfaces identified in the Investment Summary and licensed by us to you through this Agreement.
• “we,” “us,” “our” and similar terms mean Tyler.
• “you” and similar terms mean Client.

SECTION B – SAAS SERVICES

1. Rights Granted. We grant to you the non-exclusive, non-assignable limited right to use the SaaS Services solely for your governmental purposes, subject to any limits for Defined Users or Data Storage Capacity. You may add additional users or additional data storage capacity on the terms set forth in this Agreement. In the event you regularly and/or meaningfully exceed the Defined Users or Data Storage Capacity, we reserve the right to charge you additional fees commensurate with the overage(s). You acknowledge that we have no obligation to ship copies of the Tyler Software as part of the SaaS Services. Your right to use the SaaS Services applies to releases provided as part of our Maintenance and Support Services as further detailed in this Agreement.

2. Ownership.
3 2.1.We retain all ownership and intellectual property rights to the SaaS Services, the Tyler Software, and anything developed by us under this Agreement. You do not acquire under this Agreement any license to use the Tyler Software in excess of the scope and/or duration of the SaaS Services.

2.2.The Documentation is licensed to you and may be used and copied by your employees for internal, non-commercial reference purposes only.

3. Data.

3.1. You retain all ownership and intellectual property rights to the Data. You expressly recognize that except to the extent necessary to fulfill our obligations contained in this Agreement, we do not create or endorse any Data used in connection with the SaaS Services.

3.2. You expressly grant to us a limited, non-exclusive license to access, copy, transmit, download, display, and reproduce your Data to provide services pursuant to this Agreement. Additionally, you agree that Tyler may use deidentified Data for Client or third-party demonstrative or training purposes.

3.3.Our access to and use of your Data necessary to use the Tyler Software or SaaS Services will comply with applicable provisions of our Privacy Statement (available at https://www.tylertech.com/privacy) and applicable law.

3.4.Data Breach Notification. Tyler will provide notice of a breach of Client Data in accordance with applicable state and federal data breach notification laws.

4. Restrictions.

4.1.You may not:

4.1.1. make the Tyler Software or Documentation resulting from the SaaS Services available in any manner to any third party for use in the third party’s business operations;

4.1.2. modify, make derivative works of, disassemble, reverse compile, or reverse engineer any part of the SaaS Services;

4.1.3. access or use the SaaS Services to build or support, and/or assist a third party in building or supporting, products or services competitive to us; or

4.1.4. license, sell, rent, lease, transfer, assign, distribute, display, host, outsource, disclose, permit timesharing or service bureau use, or otherwise commercially exploit or make the SaaS Services, Tyler Software, or Documentation available to any third party other than as expressly permitted by this Agreement.

4.1.5. Notwithstanding anything to the contrary in this Section 4.1, you may disclose, with our written consent, not to be unreasonably withheld, the Tyler Software, SaaS Services, or Documentation to a third party you consult with regarding the implementation or use of the Tyler Software and SaaS Services. You must ensure that any such third-party’s use is subject to the terms of this Agreement, and you acknowledge and agree that you are liable for any breach of the terms of this Agreement by such third party.

5. Software Warranty. We warrant that the Tyler Software will perform without Defects during the term of this Agreement. If the Tyler Software does not perform as warranted, we will use all reasonable efforts, consistent with industry standards, to cure the Defect in accordance with our then-current Support Call Process.

6. SaaS Services.

6.1.Audit & Compliance. Our SaaS Services are audited at least yearly in accordance with the AICPA’s Statement on Standards for Attestation Engagements (“SSAE”) No. 21. We have 4 attained, and will maintain, SOC 1 and SOC 2 compliance, or their equivalent, for so long as you are timely paying for SaaS Services. The foregoing notwithstanding, you acknowledge that the scope of audit coverage varies depending on the specific Tyler Software solution. We will provide you with a summary of our current compliance report(s) or its equivalent, upon your request. For the avoidance of doubt, if our SaaS Services are provided using a third-party data center, the compliance report may be for that third-party provider and be subject to confidential treatment in accordance with applicable law. If you want us to provide our compliance reports to a third-party auditor or similar entity, we reserve the right to require execution of an NDA by that third party.

6.2.Service Levels. The Tyler Software will be made available to you according to the terms of the SLA. Tyler SaaS Services will be provided via a third-party data center. Your Data will be inaccessible to our other customers.

6.3.Business Continuity. Data centers used to deliver SaaS Services for this Agreement have redundant telecommunications access, electrical power, and the required hardware to provide access to the SaaS Services in the event of a disaster or component failure. We test our disaster recovery plan on an annual basis. The plan is not client specific and is detailed in Tyler’s System & Organization Control reports or their equivalent. In the event of a data center failure, we reserve the right to employ our disaster recovery plan for resumption of the SaaS Services. In that event, we commit to a Recovery Point Objective (“RPO”) of 24 hours and a Recovery Time Objective (“RTO”) of 24 hours. RPO represents the maximum duration of time between the most recent recoverable copy of your hosted Data and subsequent data center failure. RTO represents the maximum duration of time following data center failure within which your access to the Tyler Software must be restored. If we employ our disaster recovery plan, we will be responsible for restoring your Data and ensuring that the SaaS Services are online, and you will be responsible for validating your Data and confirming the functioning of the SaaS Services, including any integrations.

6.4.Security Measures. We provide secure Data transmission paths between your devices and the data center used to provide SaaS Services to you. Data centers used to provide SaaS Services are accessible only by authorized personnel with a unique key entry or comparable security.

We conduct annual penetration testing of either the production network and/or web application to be performed. We will maintain industry standard intrusion detection and prevention systems to monitor malicious activity in the network and to log and block any such activity. You may not attempt to bypass or subvert security restrictions in the SaaS Services or environments related to the Tyler Software. Unauthorized attempts to access files, passwords, or other confidential information, and vulnerability and penetration test scanning of our network and systems (hosted or otherwise) are prohibited. Where applicable with respect to our applications that take or process card payment data, we comply with applicable requirements of PCI DSS. We agree to supply the then-current status of our PCI DSS compliance program in the form of an official Attestation of Compliance, which can be found at https://www.tylertech.com/about-us/compliance and, in the event of any change in our status, we will comply with applicable notice requirements.

SECTION C – PROFESSIONAL SERVICES

1. Professional Services. We will provide you the various implementation-related services itemized in the Investment Summary.

2. Professional Services Fees. You agree to pay us the services fees in the amounts set forth in the 5 Investment Summary. You acknowledge that the fees stated in the Investment Summary, unless expressly stated otherwise, are good-faith estimates of the amount of time and materials required for your implementation. We will bill you the actual fees incurred based on the in-scope services provided to you. Any discrepancies in the total values set forth in the Investment Summary will be resolved by multiplying the applicable rate by the quoted units.

3. Additional Services. The Investment Summary contains the scope of services and related costs (including programming and/or interface estimates) required for the project based on our understanding of the specifications you supplied. If additional work is required, or if you use or request additional services, we will provide you with an addendum or change order, as applicable, outlining the costs for the additional work. The price quotes in the addendum or change order will be valid for thirty (30) days from the date of the quote.

4. Cancellation. If you cancel services less than four (4) weeks in advance (other than for Force Majeure or breach by us), you will be liable for all (i) daily fees associated with cancelled professional services if we are unable to reassign our personnel and (ii) any non-refundable travel expenses already incurred by us on your behalf. We will make all reasonable efforts to reassign personnel in the event you cancel within four (4) weeks of scheduled commitments.

5. Services Warranty. We will perform services in a professional, workmanlike manner, consistent with industry standards. In the event we provide services that do not conform to this warranty, we will re-perform such services at no additional cost to you.

6. Site Access and Requirements. At no cost to us, you agree to provide us with reasonable access to your personnel, facilities, and equipment as may be reasonably necessary for us to provide implementation services, subject to any reasonable security protocols or other written policies provided to us as of the Effective Date, and thereafter as mutually agreed to by you and us.

7. Background Checks. All of our employees undergo criminal background checks prior to hire. All employees sign our confidentiality agreement and security policies.

8. Client Assistance. You acknowledge that the implementation of the Tyler Software is a cooperative process requiring the time and resources of your personnel. You certify that you will use reasonable efforts to cooperate with us and make your resources available for the performance of the Agreement in accordance with its terms and the mutually agreed project schedule. Additionally, you agree to use all reasonable efforts to cooperate with and assist us as may be reasonably required to support the efficient execution of the activities required for this Agreement.

Accordingly, you will provide notice of any known inability to timely meet a project commitment so that appropriate project adjustments can be made. We will not be liable for failure to meet any project deadlines or milestones when such failure is due to Force Majeure or to the failure by you to comply with the requirements of this paragraph.

9. Maintenance and Support Services.

9.1.For the duration of this Agreement, consistent with the terms set forth in our then-current Support Call Process, we will:

9.1.1. perform our maintenance and support obligations in a professional and workmanlike manner, consistent with industry standards, to provide support and resolve Defects in the Tyler Software (subject to any applicable release life cycle policy); 6 9.1.2. provide telephone support during our established support hours as indicated in our then-current Support Call Process;

9.1.3. maintain personnel that are sufficiently trained to be familiar with the Tyler Software and Third-Party Software, if any, in order to provide maintenance and support services;

9.1.4. provide releases to the Tyler Software (including updates and enhancements) that we make generally available without additional charge to customers with a current SaaS Agreement.

9.2.Your use of Tyler Software or SaaS Services requires that you remain current with supported releases of Tyler Software as indicated in any applicable release lifecycle policy. Our warranty and support commitments are contingent upon you using a supported version of the Tyler Software. Tyler may require you to update to a current version of the Tyler Software to address a critical issue (for example, to address an identified security vulnerability in the Tyler Software or a third-party component). Tyler will use commercially reasonable efforts to (i) minimize the number of such instances and (ii) provide as much advance notice as possible.

9.3.We will use all reasonable efforts to perform support services remotely. We reserve the right to use secure third-party connectivity tools to deliver maintenance and support services. We also reserve the right to collect Tyler Software or SaaS Services telemetry for product evaluation, quality assurance, and security monitoring and enhancement purposes. You agree to reasonably cooperate with us in providing access to your environments and Data for the purposes of providing maintenance and support services and acknowledge that our warranty, support, and service level obligations under this Agreement are contingent upon receiving reasonable access to your Data and systems.

9.4. For the avoidance of doubt, SaaS Fees do not include the following services: (a) onsite support; (b) application design; (c) other consulting services; or (d) telephone support outside our normal business hours as listed in our then-current Support Call Process.

SECTION D – THIRD-PARTY PRODUCTS

1. Third-Party Hardware. We will sell and deliver any Third-Party Hardware set forth in the Investment Summary for the price indicated therein. Unless otherwise indicated, installation of Third-Party Hardware will be performed by Tyler or identified third party installers.

2. Third-Party Software. Your rights under this Agreement may include rights to certain Third-Party Software. We certify that we have acquired the right to provide the Third-Party Software to you.

Your rights to the Third-Party Software will be governed by the Third-Party Terms and, in the absence of such terms, this Agreement.

3. Third Party Products Warranties.

3.1 We are authorized by each Developer or its authorized reseller to sell or grant access, as applicable, to the Third-Party Products.

3.2 Unless otherwise expressly indicated, Third-Party Hardware will be new and unused. You will receive free and clear title to the Third-Party Hardware you purchase upon your payment in full of the purchase price.

3.3 You acknowledge that we are not the manufacturer of Third-Party Products. We do not warrant or guarantee the performance of the Third-Party Products. However, we grant and pass through to you any warranty that we may receive from the Developer or supplier of the Third- 7 Party Products.

4. Third-Party Services. If you have purchased Third-Party Services, those services will be provided independently of Tyler by such third party at the rates set forth in the Investment Summary and in accordance with Exhibit B.

SECTION E – TERM AND TERMINATION

1. Term. The initial term of this Agreement is equal to the number of years indicated for SaaS Services in Exhibit A or one (1) year if no duration is indicated. The initial term commences on the first day of the first month following the Effective Date. Upon expiration of the initial term, this Agreement will renew automatically for additional one (1) year renewal terms at our then-current SaaS Fees unless terminated in writing by either party at least sixty (60) days prior to the end of the then-current renewal term. Your right to access or use the Tyler Software and the SaaS Services will terminate at the end of this Agreement.

2. Termination. This Agreement may be terminated as set forth below. In the event of termination, you will pay us for all undisputed fees and expenses related to the software, products, and/or services you have received, or we have incurred or delivered, prior to the effective date of termination. Disputed fees and expenses in all terminations other than your termination for cause must have been submitted as invoice disputes in accordance with Section G(2).

2.1.Failure to Pay Fees. You acknowledge that continued access to the SaaS Services is contingent upon your timely payment of fees. We may terminate this Agreement if you do not cure a failure to pay within sixty (60) days of our notice to you that you have overdue payments.

2.2.For Cause. If you believe we have materially breached this Agreement, you will invoke the Dispute Resolution clause set forth in Section G(2). You may terminate this Agreement for cause after following the procedures set forth in Section G(2).

2.3.Force Majeure. Either party has the right to terminate this Agreement if a Force Majeure event suspends performance of the SaaS Services for a period of forty-five (45) days or more.

2.4. Lack of Appropriations. If you should not appropriate or otherwise make available funds sufficient to utilize the SaaS Services, you may unilaterally terminate this Agreement upon thirty (30) days written notice to us. You will not be entitled to a refund or offset of previously paid, but unused SaaS Fees. You agree not to use termination for lack of appropriations as a substitute for termination for convenience.

SECTION F – INDEMNIFICATION, LIMITATION OF LIABILITY AND INSURANCE

1. Intellectual Property Infringement Indemnification.

1.1. We will defend you against any third-party claim(s) that the Tyler Software or Documentation infringes that third-party’s patent, copyright, or trademark, or misappropriates its trade secrets, and will pay the amount of any resulting adverse final judgment (or settlement to which we consent). You must notify us promptly in writing of the claim and give us sole control over its defense or settlement. You agree to provide us with reasonable assistance, cooperation, and information in defending the claim at our expense.

1.2.Our obligations under this Section F(1) will not apply to the extent the claim or adverse final judgment is based on your use of the Tyler Software in contradiction of this Agreement, including with non-licensed third parties.

1.3.If an infringement or misappropriation claim is fully litigated and your use of the Tyler Software 8 is enjoined by a court of competent jurisdiction, in addition to paying any adverse final judgment (or settlement to which we consent), we will, at our option, either:

1.3.1. procure the right to continue its use;

1.3.2. modify it to make it non-infringing; or

1.3.3. replace it with a functional equivalent.

We may elect to employ these remedies in advance of litigation if we receive information concerning an infringement or misappropriation claim.

1.4.This section provides your exclusive remedy for third-party copyright, patent, or trademark infringement and trade secret misappropriation claims.

2. General Indemnification.

2.1.We will indemnify and hold harmless you and your agents, officials, and employees from and against any and all third-party claims, losses, liabilities, damages, costs, and expenses (including reasonable attorney's fees and costs) for (i) personal injury, death, or damage to tangible property, all to the extent caused by our negligence or willful misconduct; or (ii) our violation of law applicable to our performance under this Agreement. You must notify us promptly in writing of the claim and give us sole control over its defense or settlement. You agree to provide us with reasonable assistance, cooperation, and information in defending the claim at our expense.

2.2.To the extent permitted by applicable law, you will indemnify and hold harmless us and our agents, officials, and employees from and against any and all third-party claims, losses, liabilities, damages, costs, and expenses (including reasonable attorney's fees and costs) for (i) personal injury, death, or damage to tangible property, all to the extent caused by your negligence or willful misconduct; or (ii) your violation of a law applicable to your performance under this Agreement. We will notify you promptly in writing of the claim and will give you sole control over its defense or settlement. We agree to provide you with reasonable assistance, cooperation, and information in defending the claim at your expense.

3. DISCLAIMER. EXCEPT FOR THE EXPRESS WARRANTIES PROVIDED IN THIS AGREEMENT AND TO

THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, WE HEREBY DISCLAIM ALL OTHER

WARRANTIES AND CONDITIONS, WHETHER EXPRESS, IMPLIED, OR STATUTORY, INCLUDING, BUT

NOT LIMITED TO, ANY IMPLIED WARRANTIES, DUTIES, OR CONDITIONS OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. CLIENT UNDERSTANDS AND AGREES THAT TYLER DISCLAIMS ANY LIABILITY FOR ERRORS THAT RELATE TO USER ERROR.

4. LIMITATION OF LIABILITY. NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN THIS

AGREEMENT, OUR LIABILITY FOR DAMAGES ARISING OUT OF THIS AGREEMENT, WHETHER BASED

ON A THEORY OF CONTRACT OR TORT, INCLUDING NEGLIGENCE AND STRICT LIABILITY, SHALL BE LIMITED TO YOUR ACTUAL DIRECT DAMAGES, NOT TO EXCEED (i) DURING THE INITIAL TERM, AS SET FORTH IN SECTION E(1), TOTAL FEES PAID AS OF THE TIME OF THE CLAIM; OR (ii) DURING ANY RENEWAL TERM, THE THEN-CURRENT ANNUAL SAAS FEES PAYABLE IN THAT RENEWAL TERM. THE

PARTIES ACKNOWLEDGE AND AGREE THAT THE PRICES SET FORTH IN THIS AGREEMENT ARE SET

IN RELIANCE UPON THIS LIMITATION OF LIABILITY AND TO THE MAXIMUM EXTENT ALLOWED

UNDER APPLICABLE LAW, THE EXCLUSION OF CERTAIN DAMAGES, AND EACH SHALL APPLY REGARDLESS OF THE FAILURE OF AN ESSENTIAL PURPOSE OF ANY REMEDY. THE FOREGOING LIMITATION OF LIABILITY SHALL NOT APPLY TO CLAIMS THAT ARE SUBJECT TO SECTIONS F(1) AND F(2).
9 5. EXCLUSION OF CERTAIN DAMAGES. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW,

IN NO EVENT SHALL WE BE LIABLE FOR ANY SPECIAL, INCIDENTAL, PUNITIVE, INDIRECT, OR

CONSEQUENTIAL DAMAGES WHATSOEVER, EVEN IF WE HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

6. Insurance. During the course of performing services under this Agreement, we agree to maintain the following levels of insurance: (i) Commercial General Liability of at least $1,000,000 per occurrence and $2,000,000 aggregate; (ii) Automobile Liability of $1,000,000 combined single limit; (iii) Professional Liability (inclusive of cyber protection) of $1,000,000 per claim and in the aggregate; (iv) Workers Compensation complying with applicable statutory requirements; and (v) Excess/Umbrella Liability of $5,000,000. We will add you as an additional insured to our Commercial General Liability and Automobile Liability policies, which will automatically add you as an additional insured to our Excess/Umbrella Liability policy as well. We will provide you with copies of certificates of insurance upon your written request.

SECTION G – GENERAL TERMS AND CONDITIONS

1. Additional Products and Services. You may purchase additional products and services at the rates set forth in the Investment Summary for twelve (12) months from the Effective Date by executing a mutually agreed addendum. If no rate is provided in the Investment Summary, or those twelve (12) months have expired, you may purchase additional products and services at our then-current pricing, also by executing a mutually agreed addendum. The terms of this Agreement will control any such additional purchase(s), unless otherwise specifically provided in the addendum.

2. Performance Issues and Dispute Resolution.

2.1.Notice. You agree to provide us with written notice within thirty (30) days of receipt of an invoice (for invoice disputes) or, in the case of performance, becoming aware of an issue related to our performance under this Agreement.

2.2.Invoice Issues.

2.2.1. If the issue relates to an invoice, your notice must include the following: (i) the issue(s) with the invoice; (ii) the specific fee(s) at issue; and (iii) the corrective action(s) you are requesting of Tyler.

2.2.2. We will provide a response to your notice that (i) supports the validity of the invoice as issued by us; (ii) adjusts the invoice; or (iii) describes our plan to address the issues identified in your notice.

2.2.3. You agree to pay all undisputed fees by the due date. You acknowledge that you forfeit your right to dispute any fees under this Agreement when you fail to pay undisputed fees within sixty (60) days of our notice that the fees are overdue.

2.2.4. In addition to any other remedies available to us under this Agreement or law for nonpayment, we reserve the right to recover from you our reasonable costs of collection associated with your failure to timely pay amounts due under this Agreement.

2.2.5. WE RESERVE THE RIGHT TO SUSPEND PERFORMANCE OF ANY SERVICE, INCLUDING ACCESS TO SAAS SERVICES, FOR FAILURE TO TIMELY PAY UNDISPUTED FEES FIFTEEN (15) DAYS FOLLOWING OUR NOTICE OF INTENT TO DO SO.

2.3.Dispute Resolution. You agree to cooperate with us in trying to reasonably resolve all disputes, including, if requested by either party, appointing a senior representative to meet and engage in good faith negotiations with our appointed senior representative. Senior representatives will convene within thirty (30) days of the written dispute notice, unless otherwise agreed. All 10 meetings and discussions between senior representatives will be deemed confidential settlement discussions not subject to disclosure under Federal Rule of Evidence 408 or any similar applicable state rule. If we fail to resolve the dispute, then the parties shall participate in mediation in an effort to resolve the dispute. If the dispute remains unresolved after mediation, then either of us may assert our respective rights and remedies in a court of competent jurisdiction. Nothing in this section shall prevent you or us from seeking necessary injunctive relief during the dispute resolution procedures.

3. Taxes. The fees in the Investment Summary do not include any taxes, including, without limitation, sales, use, or excise tax. If you are a tax-exempt entity, you agree to provide us with a tax-exempt certificate. Otherwise, we will pay all applicable taxes to the proper authorities, and you will reimburse us for such taxes. If you have a valid direct-pay permit, you agree to provide us with a copy. For clarity, we are responsible for paying our income taxes, both federal and state, as applicable, arising from our performance of this Agreement.

4. Nondiscrimination. We will not discriminate against any employee or applicant in our employment practices or the performance of our duties, responsibilities, and obligations under this Agreement because of race, color, religion, gender, age, disability, religious beliefs, national, or ethnic origin.

We will post, where appropriate, all notices related to nondiscrimination as may be required by applicable law.

5. E-Verify. We use the U.S. Department of Homeland Security’s E-Verify system to confirm the eligibility of all current employees and persons hired during the contract term to perform services within the United States under this Agreement.

6. Subcontractors. We will not subcontract any Professional Services specifically for this Agreement without your prior written consent, not to be unreasonably withheld.

7. Binding Effect; No Assignment. This Agreement shall be binding on, and shall be for the benefit of, either your or our successor(s) or permitted assign(s). Neither party may assign this Agreement without the prior written consent of the other party; provided, however, your consent is not required for an assignment by us as a result of a corporate reorganization, merger, acquisition, or purchase of substantially all of our assets.

8. Force Majeure. Except for your payment obligations, neither party will be liable for delays in performing its obligations under this Agreement to the extent that the delay is caused by Force Majeure; provided, however, that within ten (10) business days of the Force Majeure event, the party whose performance is delayed provides the other party with written notice explaining the cause and extent thereof, as well as a request for a reasonable time extension equal to the estimated duration of the Force Majeure event.

9. No Intended Third-Party Beneficiaries. This Agreement is entered into solely for the benefit of you and us. No third party will be deemed a beneficiary of this Agreement, and no third party will have the right to make any claim or assert any right under this Agreement. This provision does not affect the rights of third parties under any Third-Party Terms.

10. Entire Agreement; Amendment. This Agreement represents the entire agreement between you and us with respect to the subject matter hereof, and supersedes any prior agreements, understandings, 11 and representations, whether written, oral, expressed, or implied. Purchase orders submitted by you, if any, are for your internal administrative purposes only, and the terms and conditions contained in those purchase orders will have no force or effect. This Agreement may only be modified in writing, signed by an authorized representative of the party against whom enforcement is sought.

11. Severability. If any term or provision of this Agreement is held invalid or unenforceable, the remainder of this Agreement will be considered valid and enforceable to the fullest extent permitted by law.

12. No Waiver. In the event that the terms and conditions of this Agreement are not strictly enforced by either party, such non-enforcement will not act as or be deemed to act as a waiver or modification of this Agreement, nor will such non-enforcement prevent such party from enforcing each and every term of this Agreement thereafter.

13. Independent Contractor. We are an independent contractor for all purposes under this Agreement.

14. Notices. All notices or communications required or permitted as a part of this Agreement, such as notice of an alleged material breach for a termination for cause or a dispute that must be submitted to dispute resolution, must be in writing and will be deemed delivered upon the earlier of the following: (i) actual receipt by the receiving party; or (ii) five (5) days following deposit with registered or certified mail with proper postage affixed and addressed to the other party at the address set forth in this Agreement or such other address as the party may have designated by proper notice. The consequences for the failure to receive a notice due to improper notification by the intended receiving party of a change in address will be borne by the intended receiving party.

15. Client Lists. You agree that we may identify you by name in client lists, marketing presentations, and promotional materials.

16. Confidentiality. Both parties recognize that their respective employees and agents, in the course of performance of this Agreement, may be exposed to confidential information and that disclosure of such information could violate rights to private individuals and entities, including the parties.

Confidential information is nonpublic information that a reasonable person would believe to be confidential and includes, without limitation, personal identifying information (e.g., social security numbers) and trade secrets, each as defined by applicable state law. Each party agrees that it will not disclose any confidential information of the other party and further agrees to take all reasonable and appropriate action to prevent such disclosure by its employees or agents. The confidentiality covenants contained herein will survive the termination or cancellation of this Agreement. This obligation of confidentiality will not apply to information that:
i. is in the public domain, either at the time of disclosure or afterwards, except by breach of this Agreement by a party or its employees or agents;
ii. a party can establish by reasonable proof was in that party's possession at the time of initial disclosure;
iii. a party receives from a third party who has a right to disclose it to the receiving party; or iv. is the subject of a legitimate disclosure request under the open records laws or similar applicable public disclosure laws governing this Agreement; provided, however, that in the event you receive an open records or other similar applicable request, you will give us prompt notice and otherwise perform the functions required by applicable law. 12 17. Business License. In the event a local business license is required for us to perform services hereunder, you will promptly notify us and provide us with the necessary paperwork and/or contact information so that we may timely obtain such license.

18. Governing Law. This Agreement will be governed by and construed in accordance with the laws of your state or commonwealth of domicile, without regard to its rules on conflicts of law.

19. Multiple Originals and Authorized Signatures. This Agreement may be executed in multiple originals, any of which will be independently treated as an original document. Any electronic, faxed, scanned, photocopied, or similarly reproduced signature on this Agreement or any amendment hereto will be deemed an original signature and will be fully enforceable as if an original signature.

Each party represents to the other that the signatory set forth below is duly authorized to bind that party to this Agreement.

20. Cooperative Procurement. To the maximum extent permitted by applicable law, we agree that this Agreement may be used as a cooperative procurement vehicle by eligible jurisdictions. In such cases, we reserve the right to negotiate and customize the terms and conditions set forth herein, including but not limited to pricing, to the scope and circumstances of that cooperative procurement.

21. Data & Insights Solution Terms. Your use of certain Tyler solutions includes Tyler’s Data & Insights data platform. Your rights, and the rights of any of your end users, to use Tyler’s Data & Insights data platform is subject to the Data & Insights SaaS Services Terms of Service, available at:
https://www.tylertech.com/terms/data-insights-saas-services-terms-of-service. By signing a Tyler Agreement or Order Form, or accessing, installing, or using any of the Tyler solutions listed at the linked terms, you certify that you have reviewed, understand, and agree to said terms.

22. Contract Documents. This Agreement includes the following exhibits:

Exhibit A Investment Summary
Exhibit B Invoicing and Payment Terms
Exhibit C Service Level Agreement
Exhibit D Third-Party Terms
13 IN WITNESS WHEREOF, a duly authorized representative of each party has executed this Agreement as of the date(s) set forth below.

Tyler Technologies, Inc. City of Taft
By: By:

Name: Name:

Title: Title:

Date: Date:

Address for Notices: Address for Notices:

Tyler Technologies, Inc. City of Taft
7701 College Boulevard 209 E Kern Street
Overland Park, KS 66210 Taft, CA 93268-3224
Attention: Chief Legal Officer Attention: ___________________________ 1 Exhibit A
Investment Summary
The Investment Summary details the products and services to be delivered by us, or a third party, as applicable, to you under the Agreement. This Investment Summary is effective as of the Effective Date regardless of any expiration date in the Investment Summary. Capitalized terms not otherwise defined will have the meaning assigned to such terms in the Agreement. [Sales quotation to be inserted prior to Agreement execution.]

REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
2025-569627-K8W0M3 CONFIDENTIAL Page 1 Quoted By: Karen Grosset Quote Expiration: 03/30/26 Quote Name: City of Taft - ERP - SaaS Quote Description: SaaS Hosting Saas Term 1.00 Sales Quotation For: Shipping Address: TAFT, CA CITY OF City of Taft ATTN: TERESA STATLER 209 E Kern St TAFT CA 93268 Taft CA 93268-3224 Tyler SaaS and Related Services Description Qty Imp. Hours Annual Fee Financial Management Accounting/GL/BG/AP 1 0 $ 15,783.00 Capital Assets 1 0 $ 6,041.00 Human Resources Management Advanced Scheduling w Mobile Access - Up to 75 Employees 1 56 $ 6,102.00 HR Management 1 0 $ 10,570.00 Payroll w Employee Access Migration 1 16 $ 17,967.00 Payroll w/ESS 1 0 $ 0.00 Recruiting 1 0 $ 1,906.00 Time & Attendance - Up to 150 Employees 1 80 $ 7,947.00 Revenue Management Accounts Receivable 1 0 $ 5,282.00 General Billing 1 0 $ 2,265.00 Utility Billing 1 0 $ 9,880.00 Content Management Content Manager Core 1 0 $ 4,797.00 Data Insights Crystal Reports 1 0 $ 0.00 Exhibit A
2025-569627-K8W0M3 CONFIDENTIAL Page 2 Role Tailored Dashboard 1 0 $ 2,317.00 Tyler Reporting Services ( Microsoft SQL Server ) 1 0 $ 7,346.00 Additional Enterprise ERP Office 1 0 $ 3,776.00 Enterprise Forms Processing (including Common Form Set) 1 0 $ 11,436.00 Recurring Services Data Access Services 1 0 $ 3,000.00 TOTAL 152 $ 116,415.00 Professional Services Description Quantity Unit Price Ext Discount Extended Price Maintenance Amazon Web Services Configuration Fee 1 $ 2,981.00 $ 2,981.00 $ 0.00 $ 0.00 Implementation - Remote 80 $ 155.00 $ 0.00 $ 12,400.00 $ 0.00 Project Planning Services 1 $ 5,821.00 $ 0.00 $ 5,821.00 $ 0.00 Onsite Implementation 40 $ 155.00 $ 0.00 $ 6,200.00 $ 0.00 Remote Implementation 112 $ 155.00 $ 0.00 $ 17,360.00 $ 0.00 TOTAL $ 41,781.00 $ 0.00 Summary One Time Fees Recurring Fees Total Tyler License Fees $ 0.00 $ 0.00 Total SaaS $ 0.00 $ 116,415.00 Total Tyler Services $ 41,781.00 $ 0.00 Total Third-Party Hardware, Software, Services $ 0.00 $ 0.00 Summary Total $ 41,781.00 $ 116,415.00 Client’s purchase of the items listed above is subject to the Comments below Unless otherwise indicated in the contract or amendment thereto, pricing for optional items will be held Exhibit A
2025-569627-K8W0M3 CONFIDENTIAL Page 3 For six (6) months from the Quote date or the Effective Date of the Contract, whichever is later. Customer Approval: Date: Print Name: P.O.#: All Primary values quoted in US Dollars Comments Tyler's quote contains estimates of the amount of services needed, based on our preliminary understanding of the scope, level of engagement, and timeline as defined in the Statement of Work (SOW) for your project. The actual amount of services required may vary, based on these factors. Tyler's pricing is based on the scope of proposed products and services contracted from Tyler. Should portions of the scope of products or services be altered by the Client, Tyler reserves the right to adjust prices for the remaining scope accordingly. Unless otherwise noted, prices submitted in the quote do not include travel expenses incurred in accordance with Tyler's then-current Business Travel Policy. Tyler's prices do not include applicable local, city or federal sales, use excise, personal property or other similar taxes or duties, which you are responsible for determining and remitting. Installations are completed remotely but can be done onsite upon request at an additional cost. In the event Client cancels services less than four (4) weeks in advance, Client is liable to Tyler for (i) all non-refundable expenses incurred by Tyler on Client's behalf; and (ii) daily fees associated with the cancelled services if Tyler is unable to re-assign its personnel. The Implementation Hours included in this quote assume a work split effort of 70% Client and 30% Tyler. Implementation Hours are scheduled and delivered in four (4) or eight (8) hour increments.

Exhibit A
2025-569627-K8W0M3 CONFIDENTIAL Page 4 Tyler provides onsite training for a maximum of 12 people per class. In the event that more than 12 users wish to participate in a training class or more than one occurrence of a class is needed, Tyler will either provide additional days at then-current rates for training or Tyler will utilize a Train-the-Trainer approach whereby the client designated attendees of the initial training can thereafter train the remaining users. Content Manager Core includes up to 1TB of storage. Should additional storage be needed it may be purchased as needed at an annual fee of $5,000 per TB. Amazon Web Services (AWS) has provided a credit in the amount of $2,981 in sponsorship of your project. Financial library includes: 1 A/P check, 1 EFT/ACH, 1 Purchase order, 1099M, 1099INT, 1099S, and 1099G. In the event Client acquires from Tyler any edition of Content Manager software other than Enterprise Edition, the license for Content Manager is restricted to use with Tyler applications only. If Client wishes to use Content Manager software with non-Tyler applications, Client must purchase or upgrade to Content Manager Enterprise Edition. Tyler's form library prices are based on the actual form quantities listed, and assume the forms will be provided according to the standard Enterprise ERP form template. Any forms in addition to the quoted amounts and types, including custom forms or forms that otherwise require custom programming, are subject to an additional fee. Please also note that use of the Tyler Forms functionality requires the use of approved printers as well. You may contact Tyler's support team for the most current list of approved printers. Any forms included in this quote are based on the standard form templates provided. Custom forms, additional forms and any custom programming are subject to additional fees not included in this quote. The additional fees would be quoted at the time of request, generally during the implementation of the forms. Please note that the form solution provided requires the use of approved printers. You may contact Tyler's support team for the most current list of approved printers. General Billing library includes: standard invoice, standard statement, standard general billing receipt and standard miscellaneous receipt. Payroll library includes: standard PR check, standard direct deposit, standard vendor from payroll check, standard vendor from payroll direct deposit, W2, W2c, ACA 1095B, ACA 1095C and 1099 R. Your rights, and the rights of any of your end users, to use Tyler’s Access applications are subject to the Terms of Services, available at https://www.tylertech.com/terms/tyler-access-applications-migration-terms. By signing this sales quotation, or accessing, installing, or using any of the Tyler solutions listed at the linked terms, you certify that you have reviewed, understand, and agree to said terms. Project Management includes project planning, kickoff meeting, status calls, task monitoring, verification and transition to support. The SaaS Setup Fee for your project has been discounted by 100% by credits sponsored and provided by Amazon Web Services (AWS).

Exhibit A
2025-569627-K8W0M3 CONFIDENTIAL Page 5
Exhibit A
1 Exhibit B
Invoicing and Payment Terms
We will provide you with the software and services set forth in the Investment Summary of the Agreement. Capitalized terms not otherwise defined will have the meaning assigned to such terms in the Agreement.

Invoicing: We will invoice you for the applicable software and services in the Investment Summary as set forth below. Your rights to dispute any invoice are set forth in the Agreement.

1. Tyler Annual Services.

1.1. SaaS Services. SaaS Fees are invoiced on an annual basis, beginning on the commencement of the initial term as set forth in Section E(1) of this Agreement. Your annual SaaS fees for the initial term are set forth in the Investment Summary. Upon expiration of the initial term, your annual SaaS fees will be at our then-current rates.

1.2. Other Annual Services. Fees for annual services other than SaaS Services are invoiced on an annual basis, beginning with the availability of the service. Your annual fees for the initial term are set forth in the Investment Summary. Upon expiration of the initial term, your annual fees will be at our then-current rates.

2. Tyler Services.

2.1. Professional Services Generally: Unless otherwise indicated below, fees for Tyler services are invoiced as delivered.

2.2. Consulting Services: Fixed fee Consulting Services will be invoiced 50% upon your acceptance of the Best Practice Recommendations, by module, and 50% upon your acceptance of custom desktop procedures, by module.

2.3. Conversions: Fixed-fee conversions are invoiced 50% upon initial delivery of the converted Data, by conversion option, and 50% upon Client acceptance to load the converted Data into Live/Production environment, by conversion option. Where conversions are quoted as estimated, we will bill you the actual services delivered on a time and materials basis.

2.4. Requested Modifications to the Tyler Software: Requested modifications to the Tyler Software are invoiced (i) 50% upon delivery of specifications and (ii) 50% upon delivery of the applicable modification. You must report any failure of the modification to conform to the specifications within thirty (30) days of delivery; otherwise, the modification will be deemed to be in compliance with the specifications after the 30-day window has passed. You may still report Defects to us as set forth in this Agreement.

2.5. Other Fixed Price Services: Other fixed price services are invoiced as delivered. For the avoidance of doubt, where “Project Planning Services” are provided, payment will be due upon delivery of the Implementation Planning document. Dedicated Project Management services, if any, will be billed monthly in arrears, beginning on the first day of the month immediately following initiation of project planning. Strategic Program Management Services, if any, will be billed monthly in arrears, beginning on the first day of the month immediately following initiation of program planning.
2 3. Hardware & Third-Party Products.

3.1. Hardware: Hardware costs, if any, are invoiced upon delivery.

3.2. Hardware Maintenance: The first year maintenance fee for hardware is invoiced upon delivery of the hardware. Subsequent annual maintenance fees for hardware are invoiced annually, in advance, at then-current rates, upon each anniversary thereof.

3.3. Third-Party Services: Fees for Third-Party Services, if any, are invoiced as delivered, along with applicable expenses, at the rates set forth in the Investment Summary.

3.4. Third Party Software. License Fees for Third Party Software, in any, are invoiced when the applicable Third Party Software is made available to you for download.

3.5. Third Party Software Maintenance: The first year maintenance fee for the Third Party Software is invoiced when it is made available to you for downloading. Subsequent annual maintenance fees for Third Party Software are invoiced annually, in advance, at then-current rates, upon each anniversary thereof.

3.6. Third-Party SaaS Services. Third-Party SaaS Services fees, if any, are invoiced on an annual basis, commencing with availability of the respective Third-Party SaaS Services. Pricing for the first year of Third-Party SaaS Services is indicated in the Investment Summary. Unless express stated otherwise, pricing for subsequent years will be at then-current rates.

4. Transaction Fees. Unless paid directly by an end user at the time of transaction, per transaction (call, message, etc.) fees are invoiced on a monthly basis. Fees are indicated in the Investment Summary and may be increased by Tyler upon notice of no less than thirty (30) days.

5. Expenses. The service rates in the Investment Summary do not include travel expenses. Expenses for Tyler delivered services will be billed as incurred and only in accordance with our then-current Business Travel Policy.

6. Credit for Prepaid Maintenance and Support Fees for Tyler Software. Client will receive a credit for the software maintenance and support fees and if applicable, for annual “Disaster Recovery” and “Tyler Systems Management” services fees, prepaid for the time period commencing on the first day of the SaaS Term.

Payment. Payment for undisputed invoices is due within forty-five (45) days of the invoice date. We prefer to receive payments electronically. Our electronic payment information is available by contacting [email protected].
1 Exhibit C

SERVICE LEVEL AGREEMENT
I. Agreement Overview
This SLA operates in conjunction with, and does not supersede or replace any part of, the Agreement. It outlines the information technology service levels related to the availability of the Tyler SaaS Services that you have requested us to provide. All other support services are documented in the Support Call Process.

This SLA does not apply to any Third-Party SaaS Services.

II. Definitions. Except as defined below, all defined terms have the meaning set forth in the Agreement.

Actual Attainment: The percentage of time the Tyler Software is available during a calendar month, calculated as follows: (Service Availability – Downtime) ÷ Service Availability.

Client Error Incident: Any service unavailability resulting from your applications, content or equipment, or the acts or omissions of any of your service users or third-party providers over whom we exercise no control.

Downtime: Those minutes during Service Availability, as defined below, when all users cannot launch, login, search or save primary data in the Tyler Software. Downtime does not include those instances in which only a Defect is present.

Emergency Maintenance Window: (1) maintenance that is required to patch a critical security vulnerability; (2) maintenance that is required to prevent an imminent outage of Service Availability; or (3) maintenance that is mutually agreed upon in writing by Tyler and the Client.

Planned Downtime: Downtime that occurs during a Standard or Emergency Maintenance window.

Service Availability: The total number of minutes in a calendar month that the Tyler Software is capable of receiving, processing, and responding to requests, excluding Planned Downtime, Client Error Incidents, denial of service attacks and Force Majeure. Service Availability only applies to Tyler Software being used in the production environment.

Standard Maintenance: Routine maintenance to the Tyler Software and infrastructure. Standard Maintenance is limited to five (5) hours per week.

III. Service Availability
a. Your Responsibilities
Whenever you experience Downtime, you must make a support call according to the procedures outlined in the Support Call Process. You will receive a support case number. b. Our Responsibilities
2 When our support team receives a call from you that Downtime has occurred or is occurring, we will work with you to identify the cause of the Downtime (including whether it may be the result of Planned Downtime, a Client Error Incident, denial of service attack or Force Majeure). We will also work with you to resume normal operations.
c. Client Relief
Our targeted Attainment Goal is 100%. You may be entitled to credits as indicated in the Client Relief Schedule found below. Your relief credit is calculated as a percentage of the SaaS Fees paid for the calendar month.

In order to receive relief credits, you must submit a request through one of the channels listed in our Support Call Process within fifteen (15) days of the end of the applicable month. We will respond to your relief request within thirty (30) days of receipt.

The total credits confirmed by us will be applied to the SaaS Fee for the next billing cycle. Issuing of such credit does not relieve us of our obligations under the Agreement to correct the problem which created the service interruption.

Credits are only payable when Actual Attainment results in eligibility for credits in consecutive months and only for such consecutive months.

Client Relief Schedule
Actual Attainment Client Relief

99.99% - 98.00% Remedial action will be taken

97.99% - 95.00% 4%
Below 95.00% 5%
IV. Maintenance Notifications
We perform Standard Maintenance during limited windows that are historically known to be reliably low-traffic times. If and when maintenance is predicted to occur during periods of higher traffic, we will provide advance notice of those windows and will coordinate to the greatest extent possible with you.

Not all maintenance activities will cause application unavailability. However, if Tyler anticipates that activities during a Standard or Emergency Maintenance window may make the Tyler Software unavailable, we will provide advance notice, as reasonably practicable, that the Tyler Software will be unavailable during the maintenance window.
1 Exhibit D
Third-Party Terms
DocOrigin Terms. Your use of Tyler Forms software and forms is subject to the DocOrigin End User License Agreement available for download here: https://eclipsecorp.us/eula/. By signing a Tyler Agreement or Order Form including Tyler forms software or forms, or accessing, installing, or using Tyler Forms software or forms, you agree that you have read, understood, and agree to such terms.

ThinPrint Terms. Your use of Tyler Forms software and forms is subject to the End User License Agreement terms for ThinPrint Engine, ThinPrint License Server, and Connected Gateway found here: https://www.thinprint.com/en/legal-notes/eula/. By signing a Tyler Agreement or Order Form, or accessing, installing, or using Tyler Forms software or forms, you agree that you have read, understood, and agree to such terms.

Taft City CouncilMarch 3, 2026

Taft City Council
March 3, 2026