Attachment D - Southern California Logistics Airport Authority Basic Financial Statements for FY 2023

AƩachment D

SOUTHERN CALIFORNIA

LOGISTICS AIRPORT AUTHORITY
(A COMPONENT UNIT OF THE

CITY OF VICTORVILLE, CALIFORNIA)

FINANCIAL STATEMENTS AND

SUPPLEMENTARY INFORMATION
YEAR ENDED JUNE 30, 2023

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY
(A COMPONENT UNIT OF THE CITY OF VICTORVILLE, CALIFORNIA)

TABLE OF CONTENTS
YEAR ENDED JUNE 30, 2023
INDEPENDENT AUDITORS’ REPORT 1

BASIC FI

NANCIAL STATEMENTS
STATEMENT OF NET POSITION 5
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION 7 STATEMENT OF CASH FLOWS 8
NOTES TO FINANCIAL STATEMENTS 10

REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF PLAN’S PROPORTIONATE SHARE OF NET PENSION
LIABILITY 44
SCHEDULE OF PLAN CONTRIBUTIONS 45
SCHEDULE OF PLAN’S PROPORTIONATE SHARE OF TOTAL OPEB
LIABILITY 46

SUPPLEMENTARY INFORMATION
COMBINING SCHEDULE OF NET POSITION 49

COMBINING SCHEDULE OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION 50
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CliftonLarsonAllen LLP
CLAconnect.com
(1)
INDEP
ENDENT AUDITORS’ REPORT
Board of Directors
Southern California Logistics Airport Authority
Victorville, California
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statements of the Southern California Logistics Airport Authority (SCLAA), a component unit of the City of Victorville, California, as of and for the year ended June 30, 2023, and the related notes to the financial statements, which collectively comprise the SCLAA’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 financial position of the SCLAA as of June 30, 2023, and the changes in financial position, and its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the SCLAA and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit.

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

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

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the SCLAA’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.

Board of Directors
Southern California Logistics Airport Authority
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Auditors’ Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a hi gh level of assurance but is not absolute assurance and, therefore, is not a guarantee that an audit conducted in accordance with GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with GAAS and Government Auditing Standards, we:
 Exercise professional judgment and maintain professional skepticism throughout the audit.  Identify and assess the risks of material misstatement of the financial stat ements, 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 disclosure s 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 SCLAA’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 SCLAA’s ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those cha
rged 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.

Board of Directors
Southern California Logistics Airport Authority
(3)
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the schedule of the plan’s proportionate share of the net pension liability, schedule of plan contributions, and schedule of the plan’s proportionate share of the total OPEB liability be presented to supplement the basic financial statements. Such information is the res ponsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with GAAS, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the informat ion because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Management has omitted management’s discussion and an alysis 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 the 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.

Supplementary Information
Our audit for the year ended June 30, 2023 was conducted for the purpose of forming an opinion on the financial statements that collectively comprise the SCLAA’s basic financial statements. The combining schedule of net position and the combining schedule of revenues, expenses, and changes in net position (supplementary information) for the year ended June 30, 2023 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 for the year ended June 30, 2023 and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with GAAS. In our opinion, the supplementary information is fairly stated, in all material respects, in relation to the basic financial statements as a whole for the year ended June 30, 2023.

Board of Directors
Southern California Logistics Airport Authority
(4)
We also previously audited, in accordance with G AAS, the basic financial statements of the SCLAA as of and for the year ended June 30, 2022 (not presented herein), and have issued our report thereon dated April 11, 2023, which contained an unmodified opinion on the financial statements of the SCLAA.

The combining schedule of net position and the combining schedule of revenues, expenses and changes in net position (supplementary information) for the year ended June 30, 2022, 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 June 30, 2022 financial statements. The supplementary information has been subjected to the auditing procedures applied in the audit of the June 30, 2022 basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare those financial statements or to those financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the supplementary information is fairly stated in all material respects in relation to the basic financial statements as a whole for the year ended June 30, 2022.

Report on Summarized Comparative Information
We have previously audited the SCLAA’s 2022 financial statements, and we expressed an unmodified opinion on the financial statements in our report dated April 11, 2023. In our opinion, the summarized comparative information presented herein as of and fo r the year ended June 30, 2022, is consistent, in all material respects, with the audited financial statements from which it has been derived.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated June 10, 2024, on our consideration of the SCLAA’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the SCLAA’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the SCLAA’s internal control over financial reporting and compliance.

CliftonLarsonAllen LLP
Irvine, California
June 10, 2024

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

STATEMENT OF NET POSITION
JUNE 30, 2023
(WITH COMPARATIVE DATA FOR JUNE 30, 2022)
See accompanying Notes to Financial Statements.
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2023 2022
ASSETS

CURRENT ASSETS
Cash and Investments 37,577,125$ 20,904,681$
Cash and Investments with Fiscal Agent 24,761,205 23,938,255 Accounts Receivable, Net 390,776 622,321
Interest Receivable 136,228 99,170
Due from Other Governments 152,472 347,685
Leases 7,770,582 7,662,011
Inventory 13,878 29,905
Total Current Assets 70,802,266 53,604,028

NONCURRENT ASSETS
Prepaid Items 55,594 53,755
Advances to City of Victorville 2,000,000 -
Leases 83,207,311 76,850,912
Nondepreciable Capital Assets 13,981,248 16,542,239 Depreciable Capital Assets, Net 109,697,569 117,979,955 Total Noncurrent Assets 208,941,722 211,426,861
Total Assets 279,743,988 265,030,889

DEFERRED OUTFLOWS OF RESOURCES
Deferred Outflows - OPEB Related 267,603 301,356
Deferred Outflows - Pension Related 1,709,212 829,725
Deferred Charge on Refunding 1,397,897 1,532,412
Total Deferred Outflows of Resources 3,374,712 2,663,493

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

STATEMENT OF NET POSITION (CONTINUED)
JUNE 30, 2023
(WITH COMPARATIVE DATA FOR JUNE 30, 2022)
See accompanying Notes to Financial Statements.
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2023 2022

LIABILITIES

CURRENT LIABILITIES
Accounts Payable 445,642$ 1,386,449$
Interest Payable 1,228,041 1,256,389
Deposits Payable 720,696 1,545,494
Unearned Revenue 1,063,573 1,301,095
Total OPEB Liability - Due Within One Year 30,446 27,309 Long-Term Liabilities, Due Within One Year 7,002,127 6,680,528 Total Current Liabilities 10,490,525 12,197,264

NONCURRENT LIABILITIES
Advances from Other Governments 11,267,089 11,034,017 Total OPEB Liability 2,009,638 2,336,476
Net Pension Liability 4,503,688 2,599,527
Long-Term Liabilities, Due in More Than One Year 273,345,970 278,623,283 Total Noncurrent Liabilities 291,126,385 294,593,303 Total Liabilities 301,616,910 306,790,567

DEFERRED INFLOWS OF RESOURCES
Deferred Inflows - OPEB Related 854,840 519,180
Deferred Inflows - Pension Related 234,104 1,151,011 Deferred Inflows - Leases 87,570,873 82,884,600
Total Deferred Inflows of Resources 88,659,817 84,554,791

NET POSITION (DEFICIT)
Net Investment in Capital Assets (130,315,399) (125,452,052) Unrestricted 23,157,372 1,801,076
Total Net Position (Deficit) (107,158,027)$ (123,650,976)$

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION YEAR ENDED JUNE 30, 2023
(WITH COMPARATIVE DATA FOR THE YEAR ENDED JUNE 30, 2022)

See accompanying Notes to Financial Statements.
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2023 2022

OPERATING REVENUES
Charges for Services:

Landing Fees 1,992,027 $ 1,712,503 $
Fuel Flowage Fees 309,239 284,213
Rent and Lease Revenue 10,907,800 9,913,634
Total Charges for Services 13,209,066 11,910,350 Fines and Forfeitures 28,873 22,003
Other 438,339 1,095,384
Total Operating Revenues 13,676,278 13,027,737

OPERATING EXPENSES
Personnel Services 3,329,516 2,646,192
Maintenance and Operations 7,432,535 7,506,153 Depreciation 9,744,648 9,610,772
Total Operating Expenses 20,506,699 19,763,117
OPERATING LOSS (6,830,421) (6,735,380)

NONOPERATING REVENUES (EXPENSES)
Intergovernmental - 59,000
Taxes 22,072,684 21,731,579
Investment Income 3,494,189 1,448,371
Interest Expense (16,864,762) (16,895,928)
Gain on Sale of Capital Assets 14,236,886 1,125
Other Nonoperating Expenses (19,137) (19,087) Proceeds from Capital Asset Sold to City 1,929,341 - Capital Asset Sold to City (1,895,090) -
Total Nonoperating Revenues (Expenses) 22,954,111 6,325,060 GAIN (LOSS) BEFORE CAPITAL CONTRIBUTIONS 16,123,690 (410,320)

CAPITAL CONTRIBUTIONS
Capital Contributions 183,723 607,812
Capital Grants 183,722 633,633
Capital Contributions from the City of Victorville - 1,895,090 Capital Contributions to the City of Victorville - (1,943,929) Capital Contribution from Tenant 1,814 - Total Capital Contributions 369,259 1,192,606 CHANGE IN NET POSITION 16,492,949 782,286
Net Position (Deficit) - Beginning of Year (123,650,976) (124,433,262) NET POSITION (DEFICIT) - END OF YEAR (107,158,027)$ (123,650,976) $

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

STATEMENT OF CASH FLOWS
YEAR ENDED JUNE 30, 2023
(WITH COMPARATIVE DATA FOR THE YEAR ENDED JUNE 30, 2022)

See accompanying Notes to Financial Statements.
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2023 2022

CASH FLOWS FROM OPERATING ACTIVITIES
Cash Received from Customers 1,918,566 $ 4,292,588 $ Cash Payments to Employees for Services (3,200,698) (2,740,404) Cash Payments to Suppliers for Goods and Services (8,359,154) (7,450,069) Net Cash Used by Operating Activities (9,641,286) (5,897,885)

CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES
Cash Received from Other Governments 22,500,969 23,722,863 Cash Received from City of Victorville - 1,940,931 Cash Paid to City of Victorville (2,233,072) (3,847,361) Net Cash Provided by Noncapital Financing Activities 20,267,897 21,816,433

CASH FLOWS FROM CAPITAL AND RELATED

FINANCING ACTIVITIES
Cash Received from the Sale of Capital Assets 14,408,189 1,125 Capital Grants 183,722 633,633
Cash Received from Leases and Rent 9,129,103 8,285,311 Cash Received from City for Acquisition of Capital Assets 1,929,341 - Cash Payments to Acquire Capital Assets (782,127) (1,288,044) Principal Paid on Capital-Related Debt (6,550,000) (6,225,000) Interest Paid on Capital-Related Debt (14,906,576) (15,238,105) Net Cash Provided (Used) by Capital and Related Financing Activit 3,411,652 (13,831,080)

CASH FLOWS FROM INVESTING ACTIVITIES
Interest Received on Investments 3,457,131 1,349,201 Net Cash Provided by Investing Activities 3,457,131 1,349,201 NET INCREASE IN CASH AND CASH EQUIVALENTS 17,495,394 3,436,669 Cash and Cash Equivalents - Beginning of Year 44,842,936 41,406,267 CASH AND CASH EQUIVALENTS - END OF YEAR 62,338,330$ 44,842,936 $

RECONCILIATION OF CASH AND CASH EQUIVALENTS TO
STATEMENT OF NET POSITION:

Cash and Investments 37,577,125 $ 20,904,681 $
Cash and Investments with Fiscal Agent 24,761,205 23,938,255 Cash and Cash Equivalents 62,338,330 $ 44,842,936 $

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

STATEMENT OF CASH FLOWS (CONTINUED)
YEAR ENDED JUNE 30, 2023
(WITH COMPARATIVE DATA FOR THE YEAR ENDED JUNE 30, 2022)

See accompanying Notes to Financial Statements.
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2023 2022

RECONCILIATION OF OPERATING LOSS TO NET CASH

PROVIDED (USED) BY OPERATING ACTIVITIES
Operating Loss (6,830,421) $ (6,735,380) $
Adjustments to Reconcile Operating Loss to Net Cash
Provided (Used) By Operating Activities:

Depreciation 9,744,648 9,610,772
Operating Rental and Lease Revenue (10,907,800) (9,913,634) Nonoperating Miscellaneous Expense (19,137) (19,087) (Increase) Decrease in Assets:

Accounts Receivable, Net 231,545 (247,475)
Inventory 16,027 (13,585)
Prepaid Items (1,839) (50,996)
Deferred Outflows - OPEB 33,753 21,614
Deferred Outflows - Pension (879,487) (39,989) Increase (Decrease) in Liabilities:

Accounts Payable (940,807) 120,665
Deposits Payable (824,798) 188,018
Unearned Revenue (237,522) 1,257,029
Accrued Compensated Absences (24,661) 10,560 Total OPEB Liability (323,701) 148,804
Net Pension Liability 1,904,161 (1,239,054)
Deferred Inflows - OPEB 335,660 (70,319)
Deferred Inflows - Pension (916,907) 1,074,172 Net Cash Used by Operating Activities (9,641,286) $ (5,897,885) $

SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING

AND FINANCING ACTIVITY
Developer/Tenant Contributed Capital Assets 185,537 $ 2,505,902 $ Interest Accretion Expenses 1,527,079 1,420,680 Amortization of Bond Discounts and Premiums 91,868 91,868 Total 1,804,484 $ 4,018,450 $

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Description of the Reporting Entity
The Southern California Logistics Airport Authority (SCLAA), a component unit of the City of Victorville, was formed in June of 1997 by the City of Victorville and the former Victorville Redevelopment Agency. Prior to the dissolution of the Victorville Redevelopment Agency in 2012, the Victorville Water District was added as a member of the JPA. The purpose of SCLAA is to provide for the coordination of long-range planning of the territory of George Air Force Base (now Southern California Logistics Airport, or the Airport). The Victor Valley Economic Development Authority (VVEDA), a Joint Powers Authority of the City of Victorville and other entities, was authorized to exclusively exercise the powers of a redev elopment agency in the area including and surrounding the Airport. VVEDA subsequently delegated to the SCLAA all of its redevelopment authority over the portion of the VVEDA project area comprised of the Airport.

B. Relationship to the City of Victorville
The SCLAA is an integral part of the reporting entity of the City of Victorville (the City) and is reflected as a blended component unit within the City of Victorville. The SCLAA fund has been included within the scope of the basic financial statements of the City because, although it is a legally separate organization, the City Council is the governing board and has financial accountability over the operations of the SCLAA. Only the SCLAA fund is included herein and these financial statements, therefore, do not purport to represent the financial position or results of operations of the City of Victorville, California.

C. Basic Financial Statements
The basic financial statements are comprised of the statement of net position, the statement of revenues, expenses, and changes in net position, the statement of cash flows and the notes to the basic financial statements.

D. Basis of Accounting, Measurement Focus, and Financial Statement Presentation The SCLAA is accounted for as an enterprise fund (proprietary fund type). A fund is an accounting entity with a self-balancing set of accounts established to record the financial position and results of operations of a specific governmental activity. The activities of enterprise funds closely resemble those ongoing businesses in which the purpose is to conserve and add to basic resources while meeting operating expenses from current revenues. Enterprise funds account for operations that provide services on a continuous basis and are substantially financed by revenues derived from user charges.

The accounting and financial reporting treatment is determined by the applicable measurement focus and basis of accounting. Measurement focus indicates the type of resources being measured such as econom ic resources. The basis of accounting indicates the timing of transactions or events for recognition in the financial statements.

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Basis of Accounting, Measurement Focus, and Financial Statement Presentation (Continued)
Proprietary funds are presented using the economic resources measurement focus. This means that all assets, deferred outflows of resources, liabilities, and deferred inflows of resources (whether current or noncurrent) associated with their activity are included on their statement of net position.

Proprietary funds are presented using the accrual basis of accounting. Revenues are recognized when they are earned and expenses are recognized when the related goods or services are delivered, regardless of when the related cash flows take place. Amounts paid to acquire capital assets are capitalized as assets. Proceeds of long-term debt and acquisitions under capital leases are recorded as a liability. Amounts paid to reduce long-term indebtedness are reported as a reduction of the related liability. Bond premiums and discounts are deferred and amortized over the life of the bonds using the straight-line method for bonds issued through 2021 and the effective interest method for bonds issued thereafter. Bonds payable are reported net of the applicable bond premium or discount. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenses.

The SCLAA distinguishes operating revenues and expenses from nonoperating items.

Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with airport and rental operations. The principal operating revenues of the SCLAA are charges to customers for services, which includes landing fees, fuel flowage fees, and rent and lease revenue, fines and forfeitures, and other reimbursements. Operating expenses include personnel services, maintenance and operational costs, and depreciation of capital assets. All revenues and expenses not meeting this definition, such as taxes, investment income, and interest expense, are reported as nonoperating revenues and expenses.

E. Cash and Investments
Investments are reported in the accompanying statement of net position at fair value.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Changes in fair value that occur during a fiscal year are recognized as investment income reported for that fiscal year. Investment income includes interest earnings, changes in fair value, and any gains or losses realized upon the liquidation or sale of investments.

F. Cash Equivalents
For purposes of the statement of cash flows, cash equivalents are defined as short-term, highly liquid investments that are both readily convertible to known amounts of cash or so near their maturity that they present in significant risk of changes in value because of changes in interest rates. Cash equivalents include the cash and investments held by a fiscal agent.

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) G. Accounts Receivable
The SCLAA specifically identifies accounts that are deemed uncollectable and offsets the receivable by an allowance for doubtful accounts. The amounts recorded as accounts receivable include various reimbursements and fees due to the SCLAA, net of an allowance for doubtful accounts totaling $21,654 as of June 30, 2023.

H. Due from Other Governments
The amounts recorded as a receivable due from other governments includes grant revenues collected or provided by Federal, State, County, and City Governments and unremitted to the City as of June 30, 2023.

I. Inventory and Prepaid Items
The SCLAA uses the consumption method of accounting for inventories. Inventory consists primarily of supplies for construction and repair that are valued at cost using the weighted average method.

Certain payments to vendors that reflect costs applicable to future accounting periods are recorded as prepaid items utilizing the consumption method.

J. Leases
When the SCLAA is a lessee, a lease liability and a lease asset is recognized at the commencement of the lease term, unless the lease is a short-term lease, or it transfers ownership of the underlying asset. The lease liability is measured at the present value of payments expected to be made during the lease term (less any lease incentives). The lease asset is measured at the amount of t he initial measurement of the lease liability, plus any payments made to the lessor at or before the commencement of the lease term and certain direct costs.

When the SCLAA is a lessor, a lease receivable and a deferred inflow of resources is recognized at the commencement of the lease term, with certain exceptions for leases of assets held as investments, certain regulated leases, short-term leases, and leases that transfer ownership of the underlying asset. The lease receivable is measured at the present value of lease payments expected to be received during the lease term. The deferred inflow of resources is measured at the value of the lease receivable plus any payments received at or before the commencement of the lease term that relate to future periods.

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) K. Capital Assets
Tangible capital assets (including infrastructure) are valued at cost where historical records are available and at an estimated historical cost where no historical records exist. Donated tangible capital assets are valued at acquisition value on the date of donation. SBITA assets are initially measured as the sum of the present value of payments expected to be made during the s ubscription term, payments associated with the SBITA contract made to the SBITA vendor at the commencement of the subscription term, when applicable, and capitalizable implementation costs, less any SBITA vendor incentives received form the SBITA vendor at the commencement of the SBITA term.

SBITA assets are amortized in a systematic and rational manner over the shorter of the subscription term or the useful life of the underlying IT assets. SCLAA capitalizes all assets with an initial individual cost of more than $5,000 and a useful life in excess of one year. The cost of normal maintenance and repairs that do not add to the value of the assets or materially extend the life are not capitalized.

Depreciation is computed utilizing the straight-line method over the following useful lives for tangible capital assets:

Buildings and Improvements 10 to 50 Years
Computer and Communications 5 Years
Furniture and Equipment 3 to 7 Years
Infrastructure 20 to 40 Years
Land Improvements 10 to 50 Years
Vehicles 8 to 15 Years

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

A liability is recorded for unused sick leave balances only to the extent that it is probable that the unused balances will result in termination payments. This is estimated by including in the liability the unused balances of employees currently entitled to receive termination payment, as well as those who are expected to become eligible to receive termination benefits as a result of continuing their employment with the City. Other amounts of unused sick leave are excluded from the liability since their payment is contingent solely upon the occurrence of a future event (illness), which is outside the control of the City and the employee.

The balance of unpaid vacation and vested sick leave at year-end is recorded as a long- term liability in the financial statements.

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) M. Unearned Revenue
Unearned revenue is recorded when the SCLAA receives funds for which the goods or services have not yet been provided and, therefore, revenue has not yet been earned.

The balance in unearned revenue for the SCLAA primarily consists of funds received in advance from tenants in which the City serves as the lessor.

N. Deferred Outflows and Deferred Inflows of Resources
In addition to assets, the statement of net position reports a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources , represents a consumption of net assets that applies to future periods and so will not be recognized as an outflow of resources (expense) until that time. The category of deferred outflow of resources reported in the statement of net position is related to a loss on refunding, pension, and other postemployment benefits. A deferred loss on refunding results from the difference in the carrying value of the refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunded or refunding debt. Deferred outflows on pension and other postemployment benefits are more fully discussed in Notes 6 and 7, respectively.

In addition to liabilities, the statement of net position reports a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources , represents an acquisition of net assets that applies to future periods and will not be recognized as an inflow of resources (revenue) until that time.

The SCLAAs deferred inflows of resources reported on the statement of net position relate to leases, pension and other postemployment benefits. Amounts for leases are for amounts not yet received that are deferred and recognized as an inflow of resources in the period that the amounts are available or earned. Pension and other postemployment benefits deferred inflows of resources are more fully discussed in Notes 9 and 10, respectively.

O. Net Position
Net position is classified in the following categories:

Net Investment in Capital Assets – This amount consists of capital assets net of accumulated depreciation and reduced by outstanding debt (including premiums and discounts) and capital related payables that are attributed to the acquisition, construction, or improvement of the assets.

Restricted Net Position – This amount is restricted by enabling legislation (such as external creditors, grantors, contributors, laws or regulations of other governments).

Unrestricted Net Position – This amount is the remaining net position that does not meet the definition of “invested in capital assets” or “restricted net position.”

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NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) O. Net Position (Continued)
Sometimes the SCLAA will fund outlays for a particular purpose from both restricted (e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as restricted net position and unrestricted net position, a flow assumption must be made about the order in which the resources are considered to be applied. It is the SCLAA’s practice to consider restricted net position to have been depleted before unrestricted net position is applied, unless otherwise directed by Council.

P. Pensions
For purposes of measuring the net pension liability, deferred outflows and inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the SCLAA’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 the CalPERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value. CalPERS audited financial statements are publicly available reports that can be obtained at CalPERS’ website under Forms and Publications.

Q. Prior Year Data
Selected information regarding the prior year has been included in the accompanying financial statements. This information has been included for comparison purposes only and does not represent a complete presentation in accordance with accounting principles generally accepted in the United States of America. Accordingly, such information should be read in conjunction with the SCLAA’s prior year financial statements, from which this selected financial data was derived.

R. Estimates
The presentation of basic 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 of resources, liabilities, and deferred inflows of resources and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

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NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 2 CASH AND INVESTMENTS
Cash and investments as of June 30, 2023, are classified in the accompanying financial statements as follows:

Statement of Net Position:

Cash and Investments 37,577,125 $
Cash and Investments with Fiscal Agent 24,761,205
Total Cash and Investments 62,338,330 $

Cash and investments as of June 30, 2023, consist of the following:

Equity in City of Victorville Pool 20,163,194 $
Investments 42,175,136
Total Cash and Investments 62,338,330 $

Investments Pool of the City of Victorville
The SCLAA has no separate bank accounts or investments other than investments held by bond trustee, and their investment in LAIF. The SCLAA’s equity in the cash and investment pool is managed by the City of Victorville. The SCLAA is a voluntary participant in that pool.

This pool is governed by and under the regulatory oversight of the Investment Policy adopted by the City Council of the City of Victorville. The SCLAA has not adopted an investment policy separate from that of the City of Victorville. The fair value of the Authority’s investment in this pool is reported in t he accompanying financial statements at amounts based upon the SCLAA’s pro-rata share of the fair value calculated by the City for the entire City portfolio. The balance available for withdrawal is based on the accounting records maintained by the City, which are recorded on an original cost basis.

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NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 2 CASH AND INVESTMENTS (CONTINUED)
Investments Authorized by the California Government Code and the City’s Investment Policy
The City adopts the investment policy for the SCLAA. The table below identifies the investment types that are authorized for the SCLAA by the California Government Code and the City’s investment policy. The table also identifies certain provisions of the California Government Code (or the City’s investment policy, if more restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustees 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 by Maximum Maximum
Investment Types Investment Maximum Percentage Investment Authorized by State Law Policy Maturity* of Portfolio* in One Issuer* Local Agency Bonds Yes 5 Years 70% None
U.S. Treasury Obligations Yes 5 Years 70% None
U.S. Agency Securities Yes 5 Years 75%** None
Banker’s Acceptances No 180 Days 40% 30%
Commercial Paper - Nonpooled Funds No 270 Days 25% 10%
Commercial Paper - Pooled Funds No 270 Days 40% 10%
Negotiable Certificates of Deposit Yes 2 Years 30% None Repurchase Agreements No 1 Year None None
Reverse Repurchase Agreements No 92 Days 20% of Base Value None Medium-Term Notes No 5 Years 30% None
Mutual Funds*** No 5 Years 20%* 10%*
Money Market Mutual Funds*** Yes 5 Years 20%* None
Mortgage Pass-Through Securities No 5 Years 20% None
County Pooled Investment Funds No N/A None None
Local Agency Investment Fund (LAIF) Yes N/A None $75M
JPA Pools (Other Investment Pools) No N/A None None
* Based on state law requirements or investment policy requirements, whichever is more restrictive. ** Ginnie Mae is not to exceed 20% of the total portfolio. *** Fund must be an AAA rated Government or U.S. Treasury money fund.

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NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 2 CASH AND INVESTMENTS (CONTINUED)
Investments Authorized by Debt Agreements
Investment 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 SCLAA’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 and concentration of credit risk.

Maximum
Authorized Maximum Percentage Investment
Investment Type Maturity Allowed in One Issuer
U.S. Treasury Obligations None None None
U.S. Agency Securities None None None
Banker’s Acceptances 360 Days None None
Commercial Paper 270 Days None None
Money Market Mutual Funds None None None
Repurchase Agreements None None None
Investment Contracts None None None
Certificate of Deposit None None None
Local Agency Investment Fund (LAIF) None None None

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. One of the ways that the Authority manages its exposure to interest rate risk is by purchasing a combination of shorter-term and longer-term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time as necessary to provide the cash flow and liquidity needed for operations.

Information about the sensitivity of the fair valu es of the Authority’s investments (including investments held by bond trustee) to market interest rate fluctuations is provided by the following table that shows the distribution of these investments by maturity.

Remaining
Maturities
(in Months)
Investment Type Total Within 12
LAIF 17,413,931 $ 17,413,931 $
Held by Bond Trustee:

Money Market Mutual Funds 24,761,205 24,761,205
Total 42,175,136 $ 42,175,136 $

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NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 2 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 C ode, the City’s investment policy, or debt agreements, and the actual Standard & Poor’s rating as of year-end for each investment type.

Minimum
Investment Type Total Legal Rating AAA Not Rated
LAIF 17,413,931 $ N/A - $ 17,413,931$ Held by Bond Trustee:

Money Market Mutual Funds 24,761,205 AAA 24,761,205 - Total 42,175,136 $ 24,761,205 $ 17,413,931 $
Ratings as of Year End

Concentration of Credit Risk
The investment policy of the SCLAA contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code. The SCLAA has no investments in any one issuer (other than LAIF and money market mutual funds) that represent 5% or more of the City’s investments.

Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the City’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits: The California Government Code requires that a financial institution secure deposits made by state or local 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 market value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial institutions to secure SCLAA deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits. At June 30, 2023, the SCLAA’s deposits (bank balances) were equity in the City of Victorville’s pool, which was insured by the federal depository insurance limits or collateralized as required under California Law.

For investments identified herein as held by bond trustee, the bond trustee selects the investment under the terms of the applicable trust agreement, acquires the investment, and holds the investment on behalf of the reporting government.

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NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 2 CASH AND INVESTMENTS (CONTINUED)
Investment in State Investment Pool
The SCLAA is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by the California Government Code under the oversight of the Treasurer of the state of California. The fair value of the SCLAA’s investment in this pool is reported in the accompanying financial statements at amounts based upon the SCLAA’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.

Fair Value Measurements
The SCLAA categorizes its fair value measurement within the fair value hierarchy established by accounting principles generally accepted in the United States of America.

The fair value framework provides a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of fair value hierarchy are described as follows:

Level 1 – Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets.

Level 2 – Inputs other than quoted prices included within the Level 1 that are observable for the asset or liability, either directly or indirectly, and fair value is determined through the use of models or other valuation methodologies including:

- Quoted prices for similar assets or liabilities in active markets; - Quoted prices for identical or similar assets or liabilities in markets that are inactive;
- Inputs other than quoted prices that are observable for the asset or liability; - Inputs that are derived principally from or corroborated by observable market data by correlation of other items.

Level 3 – Inputs to the valuation methodology are unobservable and significant to the fair value measurements. These unobservable input s reflect the SCLAA’s own assumptions about the inputs market participants would use in pricing the asset or liability (including assumptions about risk). These unobservable inputs are developed based on the best information available in the circumstances and may include the SCLAA’s own data.

The SCLAA’s investments in LAIF and money market mutual funds (held by bond trustee) are not subject to the fair value measurement hierarchy.

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NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 3 CAPITAL ASSETS
The following is a summary of changes in capital assets for SCLAA at June 30, 2023:

Balance Balance
July 1, 2022 Additions Transfers Deletions June 30, 2023 Nondepreciable Assets:

Land 15,743,779 $ 210,726 $ - $ (2,066,393)$ 13,888,112 $ Construction in Progress 798,460 92,968 - (798,292) 93,136 Total Nondepreciable Assets 16,542,239 303,694 - (2,864,685) 13,981,248 Depreciable Assets:

Buildings and Improvements 183,261,905 1,228,701 - - 184,490,606 Computer and Communication 254,165 - - - 254,165 Furniture and Equipment 8,035,223 84,782 88,598 - 8,208,603 Infrastructure 104,270,490 148,779 - - 104,419,269 Land Improvements 128,489 - - - 128,489 Vehicles 916,741 - (88,598) (39,690) 788,453 Total Depreciable Assets 296,867,013 1,462,262 - (39,690) 298,289,585 Less Accumulated Depreciation:

Buildings and Improvements (113,199,426) (4,360,610) - - (117,560,036) Computer and Communication (248,881) (2,757) - - (251,638) Furniture and Equipment (5,800,058) (357,039) - - (6,157,097) Infrastructure (58,748,153) (5,012,267) - - (63,760,420) Land Improvements (128,489) - - - (128,489) Vehicles (762,051) (11,975) - 39,690 (734,336) Total Accumulated Depreciation (178,887,058) (9,744,648) - 39,690 (188,592,016) Total Depreciable Assets, Net 117,979,955 (8,282,386) - - 109,697,569 Capital Assets, Net 134,522,194 $ (7,978,692) $ - $ (2,864,685)$ 123,678,817 $

Depreciation expense for the SCLAA was $9,744,648 for the year ended June 30, 2023.

The City of Victorville’s ARPA special revenue fund purchased land from the SCLAA at a price of $1,929,341 (the book value of $1,895,090) that was appropriately recorded as a disposition of SCLAA capital assets.

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NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 4 LONG-TERM LIABILITIES
A summary of changes in long-term liabilities for the year ended June 30, 2023 is noted below:

Balance Balance Due Within
June 30, 2022 Additions Retirements June 30, 2023 One Year Other Long-Term Liabilities:

Compensated Absences 240,212 $ 184,856 $ (209,517) $ 215,551 $ 117,127 $ Other Debt:

Tax Allocation Bonds:
2005 Tax Allocation Parity Bonds 13,040,000 - (1,210,000) 11,830,000 1,265,000 2006 Tax Allocation Bonds (Non-Housing) 46,635,000 - (1,265,000) 45,370,000 1,315,000 2006 Tax Allocation Bonds (Housing) 12,525,000 - (340,000) 12,185,000 355,000 2006 Allocation Parity Bonds 41,375,000 - (160,000) 41,215,000 180,000 2006 Tax Allocation Revenue Parity Bonds 29,045,000 - (650,000) 28,395,000 690,000 2006 Tax Allocation Revenue Bonds 52,605,000 - (1,205,000) 51,400,000 1,280,000 2007 Tax Allocation Bonds 32,575,000 - (800,000) 31,775,000 840,000 2007 Tax Allocation Bonds (Non-Housing)* 34,060,000 - (805,000) 33,255,000 850,000 2008A Tax Allocation Bonds* 25,295,795 1,527,079 (115,000) 26,707,874 110,000 Tax Allocation Bonds Subtotal 287,155,795 1,527,079 (6,550,000) 282,132,874 6,885,000 Unamortized Discounts/Premiums (2,092,196) - 91,868 (2,000,328) - Total 285,303,811 $ 1,711,935 $ (6,667,649) $ 280,348,097 $ 7,002,127 $ See pledged revenue information at the end of this note.

Tax Allocation Parity Bonds, Series 2005A
In June 2005, the SCLAA issued $42,185,000 principal amount of Tax Allocation Parity Bonds, Series 2005A. This debt was issued to finance certain public capital improvements benefiting the SCLAA.

On February 8, 2006, $1.8 million of bond proceeds was invested in land for the construction of a new City library. Prior to this purchase (on November 3, 2005), the Board of Directors of the SCLAA adopted a resolution with the intent of entering into a loan agreement between the SCLAA and the City with respect to this land purchase. On September 21, 2010, City Council approved this loan agreement. Legal counsel for the City has indicated that approval by the bond insurer is not required for the investment of proceeds not held by the bond trustee.

Bonds maturing on December 1, 2010, December 1, 2016, December 1, 2020, December 1, 2025, December 1, 2030, and December 1, 2035 in the amounts of $2,765,000, $3,365,000, $5,140,000, $6,335,000, $7,870,000, and $15,335,000, respectively, are term bonds. The outstanding bonds bear interest at 3.50% to 5.00% due June 1 and December 1 of each year.

The bonds are subject to redemption prior to maturity as described in the bond covenants.

The bonds maturing on or after June 1, 2016 are subject to optional redemption in whole or in part by lot, without premium.

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NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 4 LONG-TERM LIABILITIES (CONTINUED)
Tax Allocation Parity Bonds, Series 2005A (Continued)
The bonds maturing on December 1, 2010, December 1, 2016, December 1, 2020, December 1, 2025, December 1, 2030, and December 1, 2035 are subject to mandatory redemption in part by lot, without premium, commencing December 1, 2007, December 1, 2012, December 1, 2016, December 1, 2021, December 1, 2026, and December 1, 2031, respectively, from sinking fund payments made by SCLAA.

In the fiscal year ended June 30, 2006, these bonds were partially defeased by the issuance of the Tax Allocation Revenue Parity Bonds, Refunding Series 2005 (Non-Housing). As of June 30, 2023, the required reserve for the Bonds was met with fiscal agent cash. The Bonds are a special obligation of the SCLAA payable from tax increment revenues. The amount of bonds outstanding at June 30, 2023 is $11,830,000.

Tax Allocation Revenue Parity Bonds, Refunding Series 2006 (Non-Housing) In June 2006, the SCLAA issued $62,780,000 principal amount of Tax Allocation Revenue Parity Bonds, Refunding Series 2006. The proceeds were used to refund the 2001 Tax Allocation Bonds, the 2003 Tax Allocation Bonds, and a portion of 2005 Tax Allocation Bonds. As a result, the 2001 and 2003 Tax Allocation Bonds are considered to be defeased, and the 2005 Tax Allocation Bonds are considered to be partially defeased. The respective liabilities have been removed from the statement of net position.

Bonds maturing on December 1, 2026, December 1, 2031, December 1, 2036, and December 1, 2043 in the amounts of $6,895,000, $8,595,000, $10,810,000, and $20,335,000, respectively, are term bonds. The outstanding bonds bear interest at 4.50% to

5.00% due June 1 and December 1 of each year.

The bonds are subject to redemption prior to maturity as described in the bond covenants.

The bonds maturing on or after June 1, 2016 are subject to optional redemption in whole or in part by lot without premium.

The bonds maturing on December 1, 2026, December 1, 2031, December 1, 2036, and December 1, 2043 are subject to mandatory redemption in part by lot, without premium, commencing December 1, 2022, December 1, 2027, December 1, 2032, and December 1, 2037, respectively, from sinking fund payments made by SCLAA.

As of June 30, 2023, the required reserve for the Bonds was met with fiscal agent cash. The bonds are a special obligation of the SCLAA payable from tax increment revenues. The amount of bonds outstanding at June 30, 2023 is $45,370,000.

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JUNE 30, 2023

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NOTE 4 LONG-TERM LIABILITIES (CONTINUED)
Tax Allocation Revenue Parity Bonds, Refunding Series 2006 (Housing Set-Aside) In June 2006, the SCLAA issued $16,855,000 principal amount of Housing Set-Aside Revenue Bonds, Refunding Series 2006. The proceeds were used to refund all of the 2003 Tax Allocation Bonds and a portion of the 2005 Tax Allocation Parity Bonds. As a result, the 2003 Tax Allocation Bond is considered to be defeased and the liability has been removed from the statement of net position.

Bonds maturing on December 1, 2026, December 1, 2031, December 1, 2036, and December 1, 2043 in the amounts of $1,855,000, $2,305,000, $2,905,000, and $5,460,000, respectively, are term bonds. The outstanding bonds bear interest at 4.50% to 5.00% due June 1 and December 1 of each year.

The bonds are subject to redemption prior to maturity as described in the bond covenants.

The bonds maturing on or after June 1, 2016 are subject to optional redemption in whole or in part by lot without premium.

Tax Allocation Revenue Parity Bonds, Taxable Series 2006 In June 2006, the SCLAA issued $45,020,000 principal amount of Tax Allocation Revenue Parity Bonds, Taxable Series 2006. The proceeds were used to finance certain redevelopment activities benefiting the SCLAA.

Bonds maturing on December 1, 2036 and December 1, 2043 in the amounts of $20,080,000, and $24,940,000, respectively, are term bonds. The outstanding bonds bear interest at 6.10% due June 1 and December 1 of each year.

The bonds are subject to redemption prior to maturity as described in the bond covenants.

The bonds are subject to optional redemption in whole or in part by lot, subject to a premium.

The bonds maturing on December 1, 2036 and December 1, 2043 are subject to mandatory redemption in part by pro-rata, without premium, commencing December 1, 2006 and December 1, 2037, respectively, from sinking fund payments made by SCLAA.

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JUNE 30, 2023

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NOTE 4 LONG-TERM LIABILITIES (CONTINUED)
Taxable Tax Allocation Revenue Parity Bonds, Forward Series 2006 In November 2006, SCLAA issued $34,980,000 principal amount of Taxable Tax Allocation Revenue Parity Bonds, Forward Series 2006. The proceeds were used to finance and refinance certain redevelopment activities benefiting the SCLAA.

The bonds mature from December 1, 2007 to December 1, 2043 in varying amounts.

Principal is payable in annual installments ranging from $50,000 to $2,320,000, commencing December 1, 2007. The bonds accrue interest at rates between 6.25% and

6.30%. Interest on the bonds is payable semi-annually on each June 1 and December 1, commencing June 1, 2007.

The bonds are subject to optional and mandatory redemption prior to maturity.

Taxable Subordinate Tax Allocation Revenue Bonds, Series 2006 In November 2006, the SCLAA issued $64,165,000 principal amount of Taxable Subordinate Tax Allocation Revenue Bonds, Series 2006. The proceeds were used to finance certain redevelopment activities benefiting the SCLAA.

The bonds mature from December 1, 2007 to December 1, 2043 in varying amounts.

Principal is payable in annual installments ranging from $395,000 to $4,135,000, commencing December 1, 2007. The bonds accrue interest at 6.05%. Interest on the bonds is payable semiannually on each June 1 and December 1, commencing June 1, 2007.

The bonds are subject to optional and mandatory redemption prior to maturity.

Taxable Housing Set-Aside Revenue Parity Bonds, Series 2007 In March 2007, the SCLAA issued $41,460,000 principal amount of Taxable Housing Set- Aside Revenue Parity Bonds, Series 2007. The proceeds were used to finance certain low- and moderate-income housing programs of the Authority. On July 7, 2009, $20,000,000 of bond proceeds were invested in a loan to the Victorville Water District. Legal counsel for the City has indicated that approval by the bond insurer is not required for the investment of proceeds not held by the bond trustee. In February 2013, this loan was repaid in full with interest.

Bonds maturing on December 1, 2012, December 1, 2017, December 1, 2022, December 1, 2027, and December 1, 2043 in the amounts of $3,265,000, $2,800,000, $3,620,000, $4,685,000, and $27,090,000, respectively, are term bonds. The outstanding bonds bear interest at 5.00%, 5.20%, 5.25%, 5.40%, and 5.55% due June 1 and December 1 of each year.

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JUNE 30, 2023

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NOTE 4 LONG-TERM LIABILITIES (CONTINUED)
Taxable Housing Set-Aside Revenue Parity Bonds, Series 2007 (Continued) The bonds are subject to optional redemption in whole or in part by lot, without premium.

As of June 30, 2023, the required reserve for the Bonds was met with fiscal agent cash and an insurance policy. The bonds are a special obligation of the SCLAA payable from tax increment revenues. The amount of bonds outstanding at June 30, 2023 is $31,775,000.

Subordinate Tax Allocation Revenue Bonds, Series 2007 (Non-Housing) In December 2007, the SCLAA issued $42,000,000 principal amount Subordinate Tax Allocation Revenue Bonds, Series 2007. The proceeds were used to finance certain redevelopment activities benefiting the SCLAA.

Bonds maturing on December 1, 2008, December 1, 2009, December 1, 2012, December 1, 2017, December 1, 2022, December 1, 2027, December 1, 2032, December 1, 2032, December 1, 2037, December 1, 2037, December 1, 2037, December 1, 2043 and December 1, 2043 in the amounts of $480,000, $425,000, $1,395,000, $2,805,000, $3,640,000, $4,745,000, $3,000,000, $3,275,000, $3,325,000, $3,800,000, $1,250,000, $9,210,000, and $4,650,000, respectively, are term bonds. The outstanding bonds bear interest at 4.000%, 4.200%, 4.375%, 5.250%, 5.375%, 5.600%, 5.900%, 6.000%, 5.900%,

6.000%, 6.100%, 5.900%, and 6.150% due June 1 and December 1 of each year.

The bonds are subject to redemption prior to maturity at the option of the Authority, on or after December 1, 2017, in whole or in part by lot, without premium.

The bonds maturing on the dates described above are subject to mandatory redemption in part by lot, without premium, commencing December 1, 2010, December 1, 2013, December 1, 2018, December 1, 2023, December 1, 2028, December 1, 2028, December 1, 2033, December 1, 2033, December 1, 2033, December 1, 2038, and December 1, 2038, respectively, from sinking fund payments made by SCLAA.

Subordinate Tax Allocation Revenue Bonds, Series 2008A
In May 2008, the SCLAA issued $13,334,925 principal amount of Subordinate Tax Allocation Revenue Bonds, Series 2008A. The proceeds were used to finance certain redevelopment activities benefiting the SCLAA and to partially refund the $35,000,000 principal amount of Subordinate Tax Allocation Revenue Notes, Series 2008.

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JUNE 30, 2023

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NOTE 4 LONG-TERM LIABILITIES (CONTINUED)
Subordinate Tax Allocation Revenue Bonds, Series 2008A (Continued) Bonds maturing on December 1, 2010, December 1, 2013, December 1, 2018, December 1, 2023, December 1, 2033, December 1, 2038, and December 1, 2043 in the amounts of $130,000, $215,000, $340,000, $530,000, $1,675,000, $1,285,000, and $1,720,000, respectively, are Current Interest Bonds. The outstanding bonds bear interest at 4.25%,

4.50%, 5.00%, 5.25%, 6.00%, 6.00%, and 6.00% due June 1 and December 1 of each year.

Bonds maturing on December 1 of each year beginning 2044 through 2050 in the initial principal amounts of $1,316,266, $1,216,397, $1,123,621, $1,037,536, $957,600, $883,633, and $814,910 are Capital Appreciation Bonds. The outstanding bonds bear yields to maturity of 7.300%, 7.320%, 7.340%, 7.360%, 7.380%, 7.400%, and 7.420%. All of the bonds have a future maturity value of $131,805,000 at June 30, 2023.

The current interest bonds are subject to redemption prior to maturity at the option of the Authority, on or after December 1, 2018, in whole or in part by lot, without premium. The Capital Appreciation Bonds are subject to optional redemption in whole or in part by lot, without premium.

Debt Service Requirements to Maturity
The annual requirements to amortize outstanding SCLAA debt as of June 30, 2023, are as follows for each fiscal year ending June 30:

Year Ending June 30, Principal* Interest
2024 6,885,000 $ 14,555,859 $
2025 7,245,000 14,184,559
2026 7,630,000 13,792,810
2027 8,035,000 13,379,169
2028 8,455,000 12,942,639
2029-33 49,610,000 57,879,636
2034-38 65,345,000 40,602,179
2039-43 86,570,000 18,591,969
2044-48 58,771,157 76,802,744
2049-51 88,263,843 43,035,156
Subtotal 386,810,000 305,766,720 $
Discounts/Premiums (2,000,328)
Total 384,809,672 $
* This total includes capital appreciation of $104,677,126 for tax allocation bonds that will be accrued in the future years.

Tax Allocation Bonds

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NOTES TO FINANCIAL STATEMENTS
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NOTE 4 LONG-TERM LIABILITIES (CONTINUED)
Pledged Revenue
All of the above Tax Allocation Bonds are collateralized by the pledging of certain revenues.

The amount and term of the remainder of these commitments are indicated in the debt service to maturity tables presented in the accompanying notes. The purposes for which the proceeds of the related debt issuances were utilized are disclosed in the debt descriptions in the accompanying notes.

The SCLAA contains a portion of the Victor Valley Economic Development Authority (VVEDA) Successor Agency (see Note 8 for additional information). The RPTTF (tax increment distributions) from VVEDA represent the primary revenue of the SCLAA.

As a result of the state’s action to dissolve all redevelopment agencies in the state of California, the VVEDA Successor Agency no longer receives the full amount of tax increment previously pledged by the dissolv ed redevelopment agency to its bondholders. In its place is a new revenue stream (RPTTF distributions) provided to the VVEDA Successor Agency that represents only that portion of tax increment that is necessary to pay the approved enforceable obligations that come due for that fiscal year.

For the current year, pledged gross revenue (net of certain expenses were so required by the debt agreement) as a percentage of debt service payments are indicated in the table below:

Annual Amount Annual Debt
of Pledged Service Payment Pledged
Revenue (Net of (of All Debt Revenue as
of Expenses, Secured by a Percentage
Description of Pledged Revenue Where Required) This Revenue) of Debt Service Property Tax Increment Pledged by
the Southern California Logistics
Airport Authority 22,582,823 $ 21,456,577 $ 105%

NOTE 5 ADVANCES TO/FROM
Advances to/from the City
Fund Reporting
Fund Reporting Receivable Payable Amount
Successor Agency* SCLAA 11,267,089 $ a)
SCLAA City of Victorville 2,000,000 b)

*Advances from the Successor Agency have been classified as Advances from Other Governments in the statement of net position.

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NOTE 5 ADVANCES TO/FROM (CONTINUED)
Advances to/from the City (Continued)
a) Per a loan agreement approved on September 15, 2009 by the Board of Victorville RDA, a $10,000,000 advance was made from the Bear Valley Road Redevelopment Project Area (RDA Capital Project Fund) to the SCLAA. The advance is to be used to continue redevelopment at SCLAA and to fund prior years’ capital improvements and redevelopment project expenses. The advance bears interest at 3% using the simple interest method in accordance with SB-107. The outstanding balance of the advance as of June 30, 2023, is $11,267,089.

b) A loan agreement was signed on April 18, 2023 by the City Council that authorizes the SCLAA to loan $2,000,000 to the City’s nonmajor gas utility enterprise fund for the construction of new gas infrastructure that will allow for the purchase of lower priced natural gas and future growth at SCLAA. The loan principal shall be repaid in five equal installments of $400,000 to commence in the year ending June 30, 2024 and conclude in the year ending June 30, 2028. Interest shall begin to accrue on the total principal amount commencing on July 1, 2023, and shall thereafter be calculated annually on the balance of the outstanding principal and shall be payable each year on June 30 at the annualized (averaged) LAIF rate of return. The outstanding balance of the advance as of June 30, 2023 is $2,000,000.

Due to the uncertainty on when sufficient tax increment will be available to make payments on this loan, the obligation has not yet been included on the ROPS to request funding for repayment. In future fiscal years, the loan will be added to the ROPS.

NOTE 6 PENSION PLAN
General Information about the Pension Plan
Plan Description
All qualified permanent and probationary employees are eligible to participate in the City’s Miscellaneous Plan, agent multiple-employer defined benefit pension plans administered by the California Public Employees’ Retirement System (CalPERS), which acts as a common investment and administrative agent for its participating member employers. The SCLAA’s share of the net pension liability is reported as a cost-sharing plan in these financial statements. Benefit provisions under the Plan are established by State statute and Local Government resolution. CalPERS issues publicly available reports that include a full description of the pension plan regarding benefit provisions, assumptions, and membership information that can be found on the CalPERS website.

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NOTE 6 PENSION PLAN (CONTINUED)
General Information about the Pension Plan (Continued)
Benefits Provided
CalPERS provides service retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full-time employment. Members with five years of total service are eligible to retire at age 50 to 62 with statutorily reduced benefits. For employees hired into a plan with the 1.5% at 65 formula, eligibility for service retirement is age 55 with at least five years of services. PEPRA miscellaneous members become eligible for service retirement upon attainment of age 52 with at least five years of service. All members are eligible for nonduty disability benefits after five 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 Plan’s provisions and benefits in effect as of the measurement period ended June 30, 2022, are summarized as follows:

Prior to on or after
Hire Date January 1, 2013 January 1, 2013
Benefit Formula 2.5%@55 2.0%@62
Benefit Vesting Schedule 5 Years 5 Years
of Service of Service
Benefit Payments Monthly for Life Monthly for Life
Retirement Age 50 to 55 52 to 67
Required Employee Contribution Rates 8.00% 6.75%
Required Employer Contribution Rates:

Normal Cost Rate 10.34% 10.25%
Payment of Unfunded Liability $291,574 N/A
Miscellaneous

Contributions
Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The SCLAA is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. SCLAA contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identifi ed by the pension plan terms as plan member contributions requirements are classified as plan member contributions. For the fiscal year ended June 30, 2023, SCLAA made contributions totaling $484,566.

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NOTE 6 PENSION PLAN (CONTINUED)
Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions
Actuarial Assumptions
The total pension liability for the Miscellaneous Plan for the June 30, 2022 measurement period was determined by an actuarial valuation as of June 30, 2021, with update procedures used to roll forward the total pension liability to June 30, 2022. The total pension liability for the Miscellaneous Plan was based on the following assumptions:

Valuation Date June 30, 2021
Measurement Date June 30, 2022
Actuarial Cost Method Entry-Age Normal
Cost Method
Asset Valuation Method Market Value of Assets
Actuarial Assumptions:

Discount Rate 6.90%
Inflation 2.30%
Salary Increases (1)
Mortality Rate Table (2)
Post Retirement Benefit Income (3)
(1) Varies by entry age and service.
(2) The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2021 CalPERS Experience Study for the period from 2001 to 2019. Pre-retirement and Post-retirement mortality rates include generational mortality improvement using 80% of Scale MP-2020 published by the Society of Actuaries. For more details on this table, please refer to the CalPERS Experience Study and Review of Actuarial Assumptions report from November 2021 that can be found on the CalPERS website.
(3) The lesser of contract COLA up to 2.30% until Purchasing Power Protection Allowance Floor on Purchasing Power applies, 2.30% thereafter.

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

In determining the long-term expected rate of return, CalPERS took into account both short- term and long-term market return expectations. Using historical returns all of the funds’ asset classes, expected compound (geometric) returns were calculated over the next 20 years using a building-block approach. The expected rate of return was then adjusted to account for assumed administrative expenses of 10 Basis points. The expected real rates of return by asset class are as follows:

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NOTE 6 PENSION PLAN (CONTINUED)
Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
Long-Term Expected Rate of Return (Continued)
Assumed
Asset Real Return
Asset Class (a) Allocation (a) (b)
Global Equity - Cap-weighted 30.00 % 4.54 %
Global Equity - Non-Cap-weighted 12.00 3.84
Private Equity 13.00 7.28
Treasury 5.00 0.27
Mortgage-backed Securities 5.00 0.50
Investment Grade Corporates 10.00 1.56
High Yield 5.00 2.27
Emerging Market Debt 5.00 2.48
Private Debt 5.00 3.57
Real Assets 15.00 3.21
Leverage (5.00) (0.59)
Total 100.00 %
(a) An expected inflation of 2.30% used for this period (b) Figures are based on the 2021 Asset Liability Management study.

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

Change in Assumptions
The discount rate and long-term rate of return decreased from 7.15% to 6.90% and the inflation rate decreased from 2.50% to 2.30% from the measurement date June 30, 2021 to June 30, 2022.

Proportionate Share of Net Pension Liability – City’s Miscellaneous Agent Multiple-Employer Plan Allocation to the SCLAA
The SCLAA’s net pension liability for the Plan is measured as the proportionate share of the net pension liability. The SCLAA’s proportionate share of the net pension liability was based on a projection of the SCLAA’s long-term share of contributions to the Miscellaneous Plan relative to the projected contributions of the City, actuarially determined.

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NOTE 6 PENSION PLAN (CONTINUED)
Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
Proportionate Share of Net Pension Liability – City’s Miscellaneous Agent Multiple-Employer Plan Allocation to the SCLAA (Continued)
The SCLAA’s proportionate share of the net pension liability for the Miscellaneous Plan as of the measurement dates ended June 30, 2021 and 2022, was as follows:

Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability Proportionate
(a) (b) (c) = (a) - (b) Share
Balance at: 6/30/2021 (MD) 16,301,242$ 13,701,715 $ 2,599,527 $ 7.18% Balance at: 6/30/2022 (MD) 16,021,435 11,517,747 4,503,688 6.58% Net Changes During 2021-22 (279,807)$ (2,183,968) $ 1,904,161 $ -0.60% Increase (Decrease)

Pension Expense and Deferred Outflows and Inflows of Resources For the year ended June 30, 2023, the SCLAA recognized pension expense of $669,532 for the Miscellaneous Plan. At June 30, 2023, the SCLAA reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources for the Miscellaneous Plan:

Deferred Deferred
Outflows of Inflows of
Resources Resources
Pension Contributions Subsequent to the
Measurement Date 484,566 $ - $
Changes of Assumptions 466,600 -
Differences Between Expected and Actual Experience 119,220 (234,104) Net Difference Between Projected and Actual
Earnings on Pension Plan Investments 638,826 - Total 1,709,212 $ (234,104) $

$484,566 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ending June 30, 2024. Differences between projected and actual investment earnings are amortized on a five-year straight-line basis and all other amounts are amortized over the expected average remaining service lives of all members that are provided with benefits.

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NOTE 6 PENSION PLAN (CONTINUED)
Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
Pension Expense and Deferred Outflows and Inflows of Resources (Continued) 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
Measurement Period Inflows of
Ended June 30, Resources
2024 282,020 $
2025 229,583
2026 108,207
2027 370,732
2028 -
Thereafter -

Sensitivity of the Net Pension Liability to Changes in the Discount Rate The following presents the SCLAA’s proportionate share of the net pension liability for the Miscellaneous Plan, calculated using the disc ount rate of 6.90%, as well as what the SCLAA’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is one percentage point lower or one percentage point higher than the current rate:

1% Decrease Current Rate 1% Increase
(5.90%) (6.90%) (7.90%)
Net Pension Liability 6,821,953 $ 4,503,688 $ 2,607,888 $ Discount Rate

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

Payable to the Pension Plan
At June 30, 2023, the SCLAA had no outstanding amount of contributions to the Miscellaneous Plan required for the year ended June 30, 2023.

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NOTE 7 OTHER POSTEMPLOYMENT BENEFITS PLAN
Plan Descriptions
The SCLAA participates in the City’s Other Postemployment Benefits Defined Benefit Pension Plan and the SCLAA’s share of the total OPEB liability is reported as a cost-sharing plan in these financial statements.

The City Plan provides medical benefits to eligible retired City employees and beneficiaries in accordance with various labor agreements. The plan covers employees who retire directly from the City with eight years of service. The City provides a contribution up to a certain amount (a portion of the HMO single premium). The percentage varies based on years of service.

Funding Policy
The contribution requirements of plan members and the City are established and may be amended by City Council. The contribution required to be made under City Council and labor agreement requirements is based on a pay-as-you-go basis (i.e., as medical insurance premiums become due). The City has not established a trust that is administered by the City for the purpose of holding assets accumulated for plan benefits.

Contributions
The City Plan and its contribution requirements are established by Memoranda of Understanding with the applicable employee bargaining units and may be amended by agreements between the City and the bargaining units. The annual contribution is based on the year’s retiree medical premiums (pay-as-you-go basis). For the fiscal year ended June 30, 2023, the SCLAA’s cash contributions were $15,213 in cash benefit payments, $90 in administrative costs, and the estimated implied subsidy was $7,724, resulting in total payments of $23,027.

Total OPEB Liability
The City’s total OPEB liability was measured as of June 30, 2022 and determined by an actuarial valuation as of June 30, 2022.

Actuarial Cost Method Entry Age Normal
Actuarial Assumptions:

Discount Rate 3.54%
Inflation 2.50%
Salary Increases 2.75% per annum, in aggregate
Investment Rate of Return N/A
Mortality, Retirement, Disability,
and Termination 2000-2019 Experience Study
Mortality Improvement Postretirement mortality projected fully generational with Scale MP-2021
Healthcare Trend Rate Non-Medicare: 8.5% for 2024, decreasing to an ultimate rate of 3.45% in 2076
Medicare (Non-Kaiser) - 7.5% for 2024, decreasing to an ultimate rate of 3.45% in 2076
Medicare (Kaiser) - 6.25% for 2024, decreasing to an
ultimate rate of 3.45% in 2076

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NOTE 7 OTHER POSTEMPLOYMENT BENEFITS PLAN (CONTINUED)
Discount Rate
The discount rate used to measure the total OPEB liability was 3.54%. The discount rate is determined based on the Bond Buyer 20-Bond Index since the City has not established a trust.

Change in Actuarial Assumptions
The following actuarial assumption changes occurred form the measurement periods ended June 30, 2021 to 2022:

 The discount rate changed from 2.16% to 3.54% based on changes in the index.  Inflation was lowered from 2.75% to 2.50%.
 The healthcare trend rate was updated as follows: Non-Medicare increased from

7.0% to 8.5%; Medicare (Non-Kaiser) increased from 6.1% to 7.5%; and Medicare (Kaiser) increased from 7.0% to 6.25%.
 Demographic assumptions were updated from the CalPERS 1997-2015 Experience Study to the CalPERS 2000-2019 Experience Study.
 Mortality improvement was updated from Scale MP-2020 to Scale MP-2021.

Allocation of Total OPEB Liability
The SCLAA’s proportionate share of the total O PEB liability as of the measurement dates ended June 30, 2021 and 2022, was as follows:

Total OPEB Proportionate
Liability Share
Balance - June 30, 2021 (MD) 2,363,785 $ 7.75%
Balance - June 30, 2022 (MD) 2,040,084 8.64%
Net Changes During 2021-22 323,701 $ 0.89%

Sensitivity of the Total OPEB Liability to Changes in the Discount Rate The following presents the SCLAA’s proportionate share of the total OPEB liability if it were calculated using a discount rate that is one percentage point lower or one percentage point higher than the current rate:

1% Decrease Current Rate 1% Increase
(2.54%) (3.54%) (4.54%)
Total OPEB Liability 2,414,543 $ 2,040,084 $ 1,741,551 $ Discount Rate

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NOTE 7 OTHER POSTEMPLOYMENT BENEFITS PLAN (CONTINUED)
Sensitivity of the Total OPEB Liability to Changes in the Health Care Cost Trend Rates The following presents the SCLAA’s proportionate share of the total OPEB liability if it were calculated using health care cost trend rates that are one percentage point lower (Non- Medicare: 7.5% for 2024 decreasing to 2.45% in 2076; Medicare (Non-Kaiser): 6.5% for 2024, decreasing to an ultimate rate of 2.45% in 2076; Medicare (Kaiser): 5.25% for 2024, decreasing to an ultimate rate of 2.45% in 2076) or one percentage point higher (Non- Medicare: 9.5% for 2024 decreasing to 4.45% in 2076; Medicare (Non-Kaiser): 8.5% for 2024, decreasing to an ultimate rate of 4.45% in 2076; Medicare (Kaiser): 7.25% for 2024, decreasing to an ultimate rate of 4.45% in 2076) than the current rate:

1% Decrease Current Rate 1% Increase
Total OPEB Liability 1,682,147 $ 2,040,084 $ 2,510,901 $ Healthcare Trend Rate

Recognition of Deferred Outflows and Deferred Inflows of Resources Gains and losses related to changes in total OPEB liability are recognized in OPEB expense systematically over time. Amounts are first re cognized in OPEB expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to OPEB and are to be recognized in future OPEB expense.

The recognition period differs depending on the source of the gain or loss:

Net Difference Between Projected and Actual
Earnings on OPEB Plan Investments
Plan Investments 5 Years
All Other Amounts Expected average remaining service
lifetime (EARSL) (9.8 Years at
June 30, 2022 measurement date)

OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB For the fiscal year ended June 30, 2023, t he SCLAA recognized OPEB expense of $68,740.

As of fiscal year ended June 30, 2023, the SCLAA reported deferred outflows/inflows of resources related to OPEB from the following sources:

Deferred Deferred
Outflows of Inflows of
Resources Resources
Employer Contributions Subsequent to the
Measurement Date 23,027 $ - $
Differences Between Expected and Actual Experience - (441,797) Changes of Assumptions 244,576 (413,043)
Total 267,603 $ (854,840) $

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NOTE 7 OTHER POSTEMPLOYMENT BENEFITS PLAN (CONTINUED)
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB (Continued)
The $23,027 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the Total OPEB liability during the fiscal year ending June 30, 2024. Other amounts reported as deferred outflows of resources related to OPEB will be recognized as expense as follows:

Deferred
Measurement Period Inflows of
Ending June 30, Resources
2024 (92,839) $
2025 (92,839)
2026 (92,839)
2027 (69,716)
2028 (48,460)
Thereafter (213,571)

Payable to the Pension Plan
At June 30, 2023, the SCLAA had no outstanding amount of contributions to the OPEB plan required for the year ended June 30, 2023.

NOTE 8 COMMITMENTS AND CONTINGENCIES
Litigation
The SCLAA is a defendant in certain legal actions arising in the normal course of operations. The accompanying basic financial statements reflect a liability for the probable amounts of loss associated with these claims.

Southern California Logistics Airport Authority and Stirling Enterprise LLC In the early 1990s, the U.S. Air Force closed George Air Force Base (former Base). In response the local communities formed the Victor Valley Economic Development Authority (VVEDA). VVEDA and the Air Force entered into agreements to lease and ultimately transfer title to the former Base to VVEDA. The subject land is designated as either Public Benefit Transfer (PBT) Parcels or Economic Development Conveyance (EDC) Parcels. The PBT Parcels are made up of approximately 2,200 acres previously used by the U.S. Air Force and are restricted to use as an airport. These parcels were transferred to SCLAA at no cost.

The EDC Parcels are made up of approximately 1,800 acres of adjacent property which may be developed for use as commercial property. SCLAA paid $1,636,489 and is required to pay additional $37,176 for these EDC Parcels. In 1993 a Redevelopment Plan was adopted by VVEDA establishing a redevelopment proj ect area encompassing the former Base as well as approximately 55,000 additional ac res. VVEDA delegated its decision-making authority relative to the former Base, now known as SCLAA.

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NOTE 8 COMMITMENTS AND CONTINGENCIES (CONTINUED)
Southern California Logistics Airport Authority and Stirling Enterprise LLC (Continued)
SCLAA adopted a Specific Plan in conformity with the Redevelopment Plan and adopted a Master Development Plan establishing its goal to develop the area as a cargo and aircraft maintenance facility and a business/industrial center thereby creating jobs and improving economic conditions in the Victor Valley.

In July 1998, SCLAA and Stirling Enterprises, LLC and its related entities (Stirling) entered into the first of several agreements for the marketing, acquisition, operation, and development of SCLAA. The Fourth Amended and Restated Master Agreement (Stirling Agreement) is the current agreement superseding all previous versions.

Revenues from Sales of Land
In August 2016, three agreements with Stirling were approved by the SCLAA Board of Directors that were intended to serve as a framework that encourages development before the expiration of the Master Agreement (MA). The three agreements are a Satisfaction and Termination Agreement, a Disposition, Exchange, and Development Agreement (#2), and an Option and Development Agreement.

The Disposition, Exchange, and Development Agreement allows for the removal of approximately 280-acres of Airport-owned property from the definition of EDC Parcels and the title transfer in fee to Stirling, of approximately 280 acres. The Airport-owned property will become available for the Airport for revenue-producing purposes and the Airport will have the flexibility to develop the subject property on a ground-lease basis with aviation and nonaviation (Section 2.01 of the Development and Exchange Agreement). Revenue sharing will only exist relating to these parcels if the respective transaction is procured by Stirling and be split 80/20 with the larger share to benefit SCLAA.

The Agreement also provides for the disposition of additional off-airport property. In addition to the Stirling Exchange Parcels, SCLAA will then transfer, in fee, 200 acres of property for the $.0203/psf purchase price ($176,448) and participate in revenue sharing for net proceeds in an amount equal to 30% (Section 2.03 of the Development and Exchange Agreement). Net proceeds are generally defined to be revenues generated from the eventual sale by Stirling that are residual to infrastructure costs, EIR costs and developer credits. The Agreement also transfers the public infrastructure obligations of the Authority pursuant to the MA and DDA to Stirling.

Finally, the Option Agreement, in connection with performance obligations related to the Development and Exchange Agreement, will provide Stirling the ability to acquire additional acreage currently provided for in the Master Agreement. Such an exercise of option will occur in 50-acre increments based on Stirling having developed 500,000 square feet of property owned by it. The Option Agreement is set up to run through December 2050 and can terminate sooner due to nonperformance described in Section 1.5 of the Option and Development Agreement.

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NOTE 8 COMMITMENTS AND CONTINGENCIES (CONTINUED)
Management
Stirling is allowed to lease or cause to be leased the EDC Parcels and shall participate in 20% of the Net Lease Revenue from any such leases. The Authority has retained the right to lease the PBT Parcels and retain revenues from those leases, but shall allow Stirling to participate in 20% of any net lease revenues from tenants who may be procured by Stirling and approval by the Authority. Any revenues from other interim uses on the former Base such as filming will be shared on a 50%/50% basis between Stirling and Authority.

NOTE 9 SCLAA’S FINANCIAL CONDITION, SIGNIFICANT FINANCIAL OBLIGATIONS, AND MANAGEMENT’S PLANS
In fiscal year 08/09, the assessed value for the Victor Valley Redevelopment Project Area was approximately $9.49 billion. Beginning in fiscal year 09/10, there were significant decreases in assessed value for the Victor Valley Redevelopment Project Area. Assessed values for the Project Area reached a low point of $6.6 Billion in fiscal year 12/13. The decrease was largely the result of the Great Recession. Since fiscal year 12/13, assessed values have increased steadily. For fiscal year 20/21, the assessed value for the Project Area was approximately $9.99 billion. The steady increase in assessed values have resulted in the SCLAA paying all past due debt service in the previous fiscal year. As of the December 1, 2018 tax distribution, the SCLAA was no longer in default. In 2018, Moody’s issued an upgraded rating on the Successor Agency to the Victor Valley Economic Development Authority (VVEDA) Housing Set-Aside Tax Allocation Bonds and the Non- Housing Tax Allocation Bonds to “stable” outlook as a result of resolving the outstanding defaults, and the prospective analysis on increasing assessed values in the project area.

During fiscal year 19/20 and 20/21, SCLAA had results that were not as favorable as fiscal year 18/19 with a net loss of $3.5 million and $2.5 million, respectively. However, in fiscal years 21/22 and 22/23, SCLAA had a positive net income of $782,286 and $15,894,051, respectively. A summary of the financial condition of the SCLAA enterprise fund is as follows:

Beginning Net Position (123,650,976) $
Net Income 16,492,949
Ending Net Position (107,158,027) $

Management’s Plans with Respect to its Financial Condition Management plans to ensure that annual expenditures do not exceed annual revenues and to build the reserves that are necessary to provide for economic uncertainties.

The SCLAA has continued to maintain a balance budget since 2007-2008 and all revenues are projected to cover current liabilities.

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NOTE 9 SCLAA’S FINANCIAL CONDITION, SIGNIFICANT FINANCIAL OBLIGATIONS, AND MANAGEMENT’S PLANS (CONTINUED)
Management’s Plans with Respect to its Financial Condition (Continued) Regarding the SCLAA’s financial condition, an Interfund loan agreement was signed July 1, 2016 by the Board of SCLAA and a $10,000,000 advance was made available from the 2007 SCLA Housing bond fund to the Airport Operations Fund and has been used to subsidize operations. The advance had a term repayment of five years, with an annualized Wall Street Journal Prime Rate as the interest rate. In October 2022, the outstanding balance of the loan was repaid. The advance was within the fund itself.

NOTE 10 JOINTLY GOVERNED ORGANIZATIONS
Victor Valley Economic Development Authority
The Victor Valley Economic Development Au thority (VVEDA) was formed in 1992 by the Cities of Victorville and Hesperia, the Town of Apple Valley, and the County of San Bernardino to provide the mechanism and funding to manage development of the property formerly known as the George Air Force Base, facilitate the successful reuse of the property, and promote economic development within the area surrounding the Air Base. In 2000, the City of Adelanto was added as a member of the Authority. In December 2011, Assembly Bill 1X 26 (the Bill) dissolved VVEDA, and as such all assets of the former VVEDA have been transferred to the VVEDA Successor Agency and are subject to the distribution’s provisions of the Bill. The SCLAA contains a portion of the VVEDA Successor Agency with the Town of Apple Valley and City of Adelanto comprising the rest of the VVEDA Successor Agency. The RPTTF (tax increment distributions) from VVEDA represent the primary revenue of the SCLAA. Financial statements may be obtained by sending a written request to Victor Valley Economic Development Authority, 18374 Phantom Street, Victorville, CA 92394.

NOTE 11 SUCCESSOR AGENCY TRUST FOR ASSETS OF THE 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 SCLAA because the SCLAA has historically funded its operations and debt service using significant tax increment revenue from the Victor Valley Economic Development Agency (VVEDA). VVEDA has acted as a pass-through agency for the various recipients of tax increment revenue in the Victor Valley and is subject to the dissolution requirements of the Bill.

The Bill provides that upon dissolution of a redevelopment agency, either the city or another unit of local government will agree to serve as the “successor agency” to hold the assets until they are distributed to other units of state and local government. On January 17, 2012, the Victorville City Council elected to become the Successor Agency for the former redevelopment agency in accordance with the Bill as part of City resolution number 12-005.

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2023

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NOTE 11 SUCCESSOR AGENCY TRUST FOR ASSETS OF THE FORMER REDEVELOPMENT

AGENCY (CONTINUED)
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 at the date of dissolution (including the completion of any unfinished projects that were subject to legally enforceable contractual commitments).

NOTE 12 LEASES
The SCLAA, acting as lessor, leases buildings and land under long-term, noncancelable lease agreements. The leases expire at various dates through 2056 and provide for renewal options ranging from 1 year to 55 years. During the year ended June 30, 2023, the SCLAA recognized $8,159,454 and $1,624,219 in lease revenue and interest revenue, respectively, pursuant to these contracts.

Certain leases provide for increases in future minimum annual rental payments based on a defined percent in the contract or increases in the Consumer Price Index, subject to certain minimum increases. Lease revenue comprises a majority of the SCLAA’s operating revenues, therefore, this activity is considered to be the principal operation of the SCLAA.

Total future minimum lease payments to be received under lease agreements are as follows:

Year Ending June 30, Principal Interest Total
2024 7,770,582 $ 1,784,891 $ 9,555,473 $
2025 7,020,478 1,700,945 8,721,423
2026 6,996,082 1,644,500 8,640,582
2027 7,201,850 1,521,580 8,723,430
2028 7,553,445 1,312,066 8,865,511
2029-2033 30,788,077 4,412,609 35,200,686 2034-2038 11,193,728 1,722,627 12,916,355 2039-2043 3,962,741 1,079,111 5,041,852 2044-2048 4,144,818 638,687 4,783,505 2049-2053 3,279,898 254,237 3,534,135 2054-2056 1,066,194 27,697 1,093,891 Total 90,977,893 $ 16,098,950 $ 107,076,843 $

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REQUIRED SUPPLEMENTARY INFORMATION

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY
SCHEDULE OF PLAN’S PROPORTIONATE SHARE OF NET PENSION LIABILITY (COST SHARING PLAN)
LAST TEN FISCAL YEARS*

(44)

2023 2022 2021 2020 2019 2018 2017 2016 2015
(2022) (2021) (2020) (2019) (2018) (2017) (2016) (2015) (2014) Plan’s Proportion of the
Net Pension Liability 6.58% 7.18% 6.84% 6.86% 6.90% 6.95% 7.07% 6.87% 6.76% Plan’s Proportionate Share of the
Net Pension Liability 4,503,687 $ 2,599,527 $ 3,838,581 $ 3,546,936 $ 3,189,455 $ 3,210,086 $ 2,805,052 $ 2,090,587 $ 1,880,791 $ Plan’s Covered Payroll 1,868,216 $ 1,676,551 $ 1,686,096 $ 1,534,654 $ 1,565,360 $ 1,579,911 $ 1,368,422 $ 1,343,244 $ 1,310,612 $ Plan’s Proportionate Share of the
Net Pension Liability as a
Percentage of Covered Payroll 241.07% 155.05% 227.66% 231.12% 203.75% 203.18% 204.98% 155.64% 143.50% Plan’s Proportionate Share of the
Fiduciary Net Position as a
Percentage of the Plan’s Total
Pension Liability 4 .73% 6.03% 5. 04% 5.11% 5.22% 5.18% 5.33% 5. 50% 6.76% Notes to Schedule:

Benefit Changes:

There were no changes in benefits.

Changes in Assumptions:

From fiscal year June 30, 2015 to June 30, 2016:

GASB 68, paragraph 68 states that the long-term expected rate of return should be determined net of pension plan investment expense but without reduction for pension plan administrative expense. The discount rate of 7.50% used for the June 30, 2014 measurement date was net of administrative expenses. The discount rate of 7.65% used for the June 30, 2015 measurement date is without reduction of pension plan administrative expense.

From fiscal year June 30, 2016 to June 30, 2017:

There were no changes in assumptions.

From fiscal year June 30, 2017 to June 30, 2018:

The discount rate was reduced from 7.65% to 7.15%.

From fiscal year June 30, 2018 to June 30, 2022:

There were no significant changes in assumptions.

From fiscal year June 30, 2022 to June 30, 2023:

The discount rate and long-term rate of return decreased from 7.15% to 6.90% and the inflation rate decreased from 2.50% to 2.30%. *Fiscal year 2015 was the first year of implementation, therefore, only nine years are shown.

Reporting Fiscal Year
(Measurement Date)

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

SCHEDULE OF PLAN CONTRIBUTIONS
(COST SHARING PLAN)
LAST TEN FISCAL YEARS*

(45)

2022-2023 2021-2022 2020-2021 2019-2020 2018-2019 2017-2018 2016-2017 2015-2016 2014-2015 Actuarially Determined Contribution 484,566$ 414,447 $ 381,393 $ 345,578 $ 279,699 $ 275,299 $ 273,075 $ 233,116 $ 197,631 $ Contributions in Relation to the
Actuarially Determined Contribution (484,566) (414,447) (381,393) (345,578) (279,699) (275,299) (273,075) (233,116) (197,631) Contribution Deficiency (Excess) - $ - $ - $ - $ - $ - $ - $ - $ - $ Covered Payroll 2,069,493 $ 1,868,216 $ 1,676,551 $ 1,686,096 $ 1,534,654 $ 1,565,360 $ 1,579,911 $ 1,368,422 $ 1,343,244 $ Contributions as a Percentage
of Covered Payroll 23.41% 22.18% 22.75% 20.50% 18.23% 17.59% 17.28% 17.04% 14.71% Notes to Schedule:

Valuation Date 6/30/2020 6/30/2019 6/30/2018 6/30/2017 6/30/2016 6/30/2015 6/30/2014 6/30/2013 6/30/2012 Methods and Assumptions Used
to Determine Contribution Rates:

Actuarial Cost Method Entry age Entry Age Entry Age Entry Age Entry Age Entry Age Entry Age Entry Age Entry Age Amortization Method (1) (1) (1) (1) (1) (1) (1) (1) (1) Asset Valuation Method Fair Value Fair Value Fair Value Fai r Value Fair Value Fair Value Fair Value Fair Value 15-Year Smoothed
Market
Method
Inflation 2.30% 2.50% 2.50% 2.63% 2.75% 2.75% 2.75% 2.75% 2.75% Salary increases (2) (2) (2) (2) (2) (2) (2) (2) (2)
Investment Rate of Return 6.90% (3) 7.00% (3) 7.00% (3) 7.25% (3) 7.375% (3) 7.50% (3) 7.50% (3) 7.50% (3) 7.50% (3) Retirement Age (4) (4) (4) (4) (4) (4) (4) (4) (4)
Mortality (5) (5) (5) (5) (5) (5) (5) (5) (5)
(1) Level percentage of payroll, closed
(2) Depending on age, service, and type of employment
(3) Net of pension plan investment expense, including inflation (4) 50 - 55 for 2.5%@55; 52 - 67 for 2.0%@62
(5) Mortality assumptions are based on mortality rates resulting from the most recent CalPERS Experience Study adopted by the CalPERS Board.
*Fiscal year 2015 was the first year of implementation, therefore, only nine years are shown.

Fiscal Year

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY
SCHEDULE OF PLAN’S PROPORTIONATE SHARE OF TOTAL OPEB LIABILITY (COST SHARING PLAN)
LAST TEN FISCAL YEARS*

(46)

2023
(2022)
Plan’s Proportion of the Total
OPEB Liability 8.64%
Plan’s Proportionate Share of the
Total OPEB Liability 2,040,084$
Plan’s Covered Payroll 2,827,400$
Plan’s Proportionate Share of the
Total OPEB Liability as a Percentage
of Covered Employee Payroll 72.15%
Notes to Schedule:

Changes in Assumptions:

Discount Rate 3.54%
Mortality Improvement Rates Scale
MP-2021
The mortality, retirement, disability, and termination rates for the measurement periods ended June 30, 2017 and 2018 were based on the CalPERS 1997-2011 Experience Study and CalPERS 1997-2015 Experience Study, respectively.

In the June 30, 2018 measurement period, the pre-65 waived retiree re-election was updated to be 10% after age 65.

In the June 30, 2020 measurement period, the medic al trend rate for Kaiser Senior Advantage plans decreased from 6.5% to 5.0%.

In the June 30, 2022 measurement period, the f ollowing medical trend rates changed: Non-Medicare increased from 7.0% to 8.5%; Medicare increased from 6.1% to 7.5%; and Kaiser increased from 7.0% to 6.25%.
*Fiscal year 2018 was the first year of implementation, therefore only six years are shown.

Fiscal Year Ended
(Measurement Date)

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY
SCHEDULE OF PLAN’S PROPORTIONATE SHARE OF TOTAL OPEB LIABILITY (CONTINUED) (COST SHARING PLAN)
LAST TEN FISCAL YEARS*

(47)

2022 2021 2020 2019 2018
(2021) (2020) (2019) (2018) (2017)
Plan’s Proportion of the Total
OPEB Liability 7.75% 7.99% 8.19% 8.57% 8.43%
Plan’s Proportionate Share of the
Total OPEB Liability 2,363,785 $ 2,214,981 $ 2,093,649 $ 1,888,372 $ 2,014,829 $ Plan’s Covered Payroll 2,396,424 $ 2,348,399 $ 1,993,268 $ 1,735,340 $ 1,494,600 $ Plan’s Proportionate Share of the
Total OPEB Liability as a Percentage
of Covered Employee Payroll 98.64% 94.32% 105.04% 108.82% 134.81% Notes to Schedule:

Changes in Assumptions:

Discount Rate 2.16% 2.21% 3.50% 3.87% 3.58%
Mortality Improvement Rates Scale Scale Scale Scale Scale MP-2020 MP-2020 MP-2018 MP-2018 MP-2016
The mortality, retirement, disability, and termination rates for the measurement periods ended June 30, 2017 and 2018 were based on the CalPERS 1997-2011 Experience Study and CalPERS 1997-2015 Experience Study, respectively.

In the June 30, 2018 measurement period, the pre-65 waived retiree re-election was updated to be 10% after age 65.

In the June 30, 2020 measurement period, the medic al trend rate for Kaiser Senior Advantage plans decreased from 6.5% to 5.0%.

(48)

SUPPLEMENTARY INFORMATION

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

COMBINING SCHEDULE OF NET POSITION
JUNE 30, 2023
(WITH SUMMARIZED DATA FOR JUNE 30, 2022)

(49)

Non Other
Aeronautical Aeronautical Services Elimination 2023 2022 ASSETS

CURRENT ASSETS
Cash and Investments 8,790,916 $ 2,840,265 $ 25,945,944 $ - $ 37,577,125$ 20,904,681 $ Cash and Investments with Fiscal Agent - - 24,761,205 - 24,761,205 23,938,255 Accounts Receivable, Net 390,341 435 - - 390,776 622,321 Interest Receivable 136,015 13 200 - 136,228 99,170 Due from Other Governments 152,472 - - - 152,472 347,685 Leases 6,713,490 58,291 998,801 - 7,770,582 7,662,011 Inventory 13,878 - - - 13,878 29,905 Total Current Assets 16,197,112 2,899,004 51,706,150 - 70,802,266 53,604,028

NONCURRENT ASSETS
Prepaid Items 55,594 - - - 55,594 53,755 Advances to City of Victorville - 2,000,000 - - 2,000,000 - Leases 83,147,197 60,114 - - 83,207,311 76,850,912 Nondepreciable Capital Assets 188,067 - 13,793,181 - 13,981,248 16,542,239 Depreciable Capital Assets, Net 25,796,888 - 83,900,681 - 109,697,569 117,979,955 Total Noncurrent Assets 109,187,746 2,060,114 97,693,862 - 208,941,722 211,426,861 Total Assets 125,384,858 4,959,118 149,400,012 - 279,743,988 265,030,889

DEFERRED OUTFLOWS OF RESOURCES
Deferred Outflows - OPEB Related 267,603 - - - 267,603 301,356 Deferred Outflows - Pension Related 1,709,212 - - - 1,709,212 829,725 Deferred Charge on Refunding - - 1,397,897 - 1,397,897 1,532,412 Total Deferred Outflows of
Resources 1,976,815 - 1,397,897 - 3,374,712 2,663,493

LIABILITIES

CURRENT LIABILITIES
Accounts Payable 445,642 - - - 445,642 1,386,449 Interest Payable - - 1,228,041 - 1,228,041 1,256,389 Deposits Payalbe 703,281 17,415 - - 720,696 1,545,494 Unearned Revenue 1,048,124 15,449 - - 1,063,573 1,301,095 Total OPEB Liability - Due Within One Year 30,446 - - - 30,446 27,309 Long-Term Liabilities, Due Within One Year 117,127 - 6,885,000 - 7,002,127 6,680,528 Total Current Liabilities 2,344,620 32,864 8,113,041 - 10,490,525 12,197,264

NONCURRENT LIABILITIES
Advances from Other Governments - - 11,267,089 - 11,267,089 11,034,017 Total OPEB Liability 2,009,638 - - - 2,009,638 2,336,476 Net Pension Liability 4,503,688 - - - 4,503,688 2,599,527 Long-Term Liabilities, Due Beyond One Year 98,424 - 273,247,546 - 273,345,970 278,623,283 Total Noncurrent Liabilities 10,855,348 65,728 299,512,676 - 310,433,752 316,344,993 Total Liabilities 13,199,968 98,592 307,625,717 - 320,924,277 328,542,257

DEFERRED INFLOWS OF RESOURCES
Deferred Inflows - OPEB Related 854,840 - - - 854,840 519,180 Deferred Inflows - Pension Related 234,104 - - - 234,104 1,151,011 Deferred Inflows - Leases 86,455,442 116,629 998,802 - 87,570,873 82,884,600 Total Deferred Inflows of Resources 87,544,386 116,629 998,802 - 88,659,817 84,554,791

NET POSITION (DEFICIT)
Net Investment in Capital Assets 25,964,183 - (156,279,582) - (130,315,399) (125,452,052) Unrestricted 4,896,734 4,809,625 13,451,013 - 23,157,372 1,801,076 Total Net Position (Deficit) 30,860,917 $ 4,809,625 $ (142,828,569)$ - $ (107,158,027)$ (123,650,976) $ Totals

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

COMBINING SCHEDULE OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION YEAR ENDED JUNE 30, 2023
(WITH SUMMARIZED DATA FOR THE YEAR ENDED JUNE 30, 2022)

(50)

Non Other
Aeronautical Aeronautical Services Elimination 2023 2022

OPERATING REVENUES
Charges for Services:

Landing Fees 1,992,027 $ - $ - $ - $ 1,992,027$ 1,712,503 $ Fuel Flowage Fees 309,239 - - - 309,239 284,213 Rent and Lease Revenue 9,675,756 233,242 998,802 - 10,907,800 9,913,634 Total Charges for Services 11,977,022 233,242 998,802 - 13,209,066 11,910,350 Fines and Forfeitures 28,873 - - - 28,873 22,003 Other 404,139 34,200 - - 438,339 1,095,384 Total Operating Revenues 12,410,034 267,442 998,802 - 13,676,278 13,027,737

OPERATING EXPENSES
Personnel Services 3,329,516 - - - 3,329,516 2,646,192 Maintenance and Operations 4,863,941 2,543,114 25,480 - 7,432,535 7,506,153 Depreciation 3,519,748 - 6,224,900 - 9,744,648 9,610,772 Total Operating Expenses 11,713,205 2,543,114 6,250,380 - 20,506,699 19,763,117 OPERATING INCOME (LOSS) 696,829 (2,275,672) (5,251,578) - (6,830,421) (6,735,380)

NONOPERATING REVENUES (EXPENSES)
Intergovernmental - - - - - 59,000 Taxes 445,248 - 21,627,436 - 22,072,684 21,731,579 Investment Income 1,909,591 64,538 1,641,631 (121,571) 3,494,189 1,448,371 Interest Expense (121,571) - (16,864,762) 121,571 (16,864,762) (16,895,928) Gain on Sale of Capital Assets 13,360 14,394,829 (171,303) - 14,236,886 1,125 Other Nonoperating Expenses - - (19,137) - (19,137) (19,087) Proceeds from Capital Asset Sold to City - 1,929,341 - - 1,929,341 - Capital Asset Sold to City - - (1,895,090) - (1,895,090) - Total Nonoperating Revenues
(Expenses) 2,246,628 16,388,708 4,318,775 - 22,954,111 6,325,060

INCOME (LOSS) BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS 2,943,457 14,113,036 (932,803) - 16,123,690 (410,320)

CAPITAL CONTRIBUTIONS
Capital Contributions 183,723 - - - 183,723 607,812 Capital Grants 183,722 - - - 183,722 633,633 Capital Contribution from the City of Victorville - - - - - 1,895,090 Capital Contribution to the City of Victorville - - - - - (1,943,929) Capital Contribution from Tenant 1,814 - - - 1,814 - Transfers In 9,467,545 - - (9,467,545) - - Transfers Out - (9,467,545) - 9,467,545 - - Total Capital Contributions 9,836,804 (9,467,545) - - 369,259 1,192,606 CHANGE IN NET POSITION 12,780,261 4,645,491 (932,803) - 16,492,949 782,286 Net Position (Deficit) - Beginning of Year 18,080,656 164,134 (141,895,766) - (123,650,976) (124,433,262) NET POSITION (DEFICIT) - END OF YEAR 30,860,917$ 4,809,625 $ (142,828,569)$ - $ (107,158,027)$ (123,650,976) $ Totals

Victorville City CouncilJune 18, 2024

Victorville City Council
June 18, 2024