CITY OF WATSONVILLE, CALIFORNIA
NONMAJOR SPECIAL REVENUE FUNDS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 2024
Variance With Variance With
Final Budget - Final Budget -
Positive Positive
Original Final Actual (Negative) Original Final Actual (Negative) $ $ $ $ $$ $ $
REVENUES:
Taxes 5,205,309 5,205,309 5,249,448 44,139 - - - -
Licenses, permits and fees 100 100 1,377 1,277 60,000 60,000 66,746 6,746 Interest 21,000 21,000 72,204 51,204 - - - -
Total revenues 5,226,409 5,226,409 5,323,029 96,620 60,000 60,000 66,746 6,746 EXPENDITURES:
Current:
Public safety 8,261,895 7,990,252 5,776,396 2,213,856 61,800 61,800 61,800 - Total expenditures 8,261,895 7,990,252 5,776,396 2,213,856 61,800 61,800 61,800 - Excess (deficiency) of revenues over
(under) expenditures (3,035,486) (2,763,843) (453,367) 2,310,476 (1,800) (1,800) 4,946 6,746 Net change in fund balances (3,035,486) (2,763,843) (453,367) 2,310,476 (1,800) (1,800) 4,946 6,746 Fund balances, July 1 3,277,733 3,277,733 3,277,733 - 49,892 49,892 49,892 - Fund balances, June 30 242,247 513,890 2,824,366 2,310,476 48,092 48,092 54,838 6,746 Budgeted Amounts Budgeted Amounts
MEASURES G/Y ABANDONED VEHICLE
118
CITY OF WATSONVILLE, CALIFORNIA
NONMAJOR SPECIAL REVENUE FUNDS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 2024
Variance With Variance With
Final Budget - Final Budget -
Positive Positive
Original Final Actual (Negative) Original Final Actual (Negative) $ $$ $ $$ $ $
REVENUES:
Taxes - - - - 1,050,000 1,050,000 1,309,830 259,830
Licenses, permits and fees 25,000 25,000 8,560 (16,440) - - - - Intergovernmental 1,546,047 22,202 (1,523,845) - - - -
Charges for services 500,000 500,000 268,290 (231,710) - - - - Interest - - 3,410 3,410 5,000 5,000 120,307 115,307
Miscellaneous 5,000 5,000 14,590 9,590 - - - -
Total revenues 530,000 2,076,047 317,052 (1,758,995) 1,055,000 1,055,000 1,430,137 375,137 EXPENDITURES:
Current:
Housing 355,222 1,932,883 300,195 1,632,688 - - - -
Streets - - - - 1,020,482 2,533,617 612,259 1,921,358
Total expenditures 355,222 1,932,883 300,195 1,632,688 1,020,482 2,533,617 612,259 1,921,358 Excess (deficiency) of revenues over
(under) expenditures 174,778 143,164 16,857 (126,307) 34,518 (1,478,617) 817,878 2,296,495 Net changes in fund balances 174,778 143,164 16,857 (126,307) 34,518 (1,478,617) 817,878 2,296,495 Fund balances, July 1 (3,340) (3,340) (3,340) - 2,799,066 2,799,066 2,799,066 - Fund balances, June 30 171,438 139,824 13,517 (126,307) 2,833,584 1,320,449 3,616,944 2,296,495 Budgeted Amounts
INCLUSIONARY HOUSING SB 1 - GAS TAX
Budgeted Amounts
119
CITY OF WATSONVILLE, CALIFORNIA
NONMAJOR SPECIAL REVENUE FUNDS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 2024
Variance With
Final Budget -
Positive
Original Final Actual (Negative)
$ $$ $
REVENUES:
Taxes 1,000,000 1,000,000 1,299,249 299,249
Interest 10,000 10,000 144,708 134,708
Total revenues 1,010,000 1,010,000 1,443,957 433,957
EXPENDITURES:
Current:
Streets 5,386,833 5,156,422 1,010,069 4,146,353
Total expenditures 5,386,833 5,156,422 1,010,069 4,146,353 Excess (deficiency) of revenues over
(under) expenditures (4,376,833) (4,146,422) 433,888 4,580,310 Net change in fund balance (4,376,833) (4,146,422) 433,888 4,580,310 Fund balance, July 1 4,338,191 4,338,191 4,338,191 -
Fund balance, June 30 (38,642) 191,769 4,772,079 4,580,310
MEASURE D
Budgeted Amounts
120
CITY OF WATSONVILLE, CALIFORNIA
DEBT SERVICE FUND
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE FISCAL YEAR ENDED JUNE 30, 2024
Variance With
Final Budget -
Positive
Original Final Actual (Negative)
$$$ $
EXPENDITURES:
Debt service:
Principal 486,459 486,459 486,460 (1)
Interest and fiscal charges 12,095 12,095 16,319 (4,224) Total expenditures 498,554 498,554 502,779 (4,225)
Excess (deficiency) of revenues over
(under) expenditures (498,554) (498,554) (502,779) (4,225) OTHER FINANCING SOURCES (USES):
Transfers in 498,554 498,554 500,357 1,803
Total other financing sources (uses) 498,554 498,554 500,357 1,803 Net change in fund balance - - (2,422) (2,422)
Fund balance, July 1 324,294 324,294 324,294 -
Fund balance, June 30 324,294 324,294 321,872 (2,422)
Budgeted Amounts
121
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STATISTICAL SECTION
This part of the City of Watsonville’s annual comprehensive financial report presents detailed information as a context for the understanding what the information in the financial statements, note disclosures, and required supplementary information says about the government’s overall financial health.
Content Page
Financial Trends 125
These schedules contain trend information to help the reader understand how the city’s financial performance and well-being have changed over time.
Revenue Capacity 130
These schedules contain information to help the reader assess the City’s most significant local revenue source, the property tax.
Debt Capacity 135
These schedules present information to help the reader assess the affordability of the city’s current levels of outstanding debt and the city’s ability to issue additional debt in the future.
Demographic and Economic Information 139
These schedules offer the demographic and economic indicators to help the reader understand the environment within which the city’s financial activities take place.
Operating Information 142
These schedules contain service and infrastructure data to help the reader understand how the information in the city’s financial report relates to the services the city provides and the activities it performs.
SOURCE: Unless otherwise noted, the information in these schedules is derived from the annual comprehensive financial reports for the relevant year.
123
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2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
$ $ $ $ $ $ $ $ $ $
Governmental activities
Net investment in capital assets 114,148 110,806 111,256 108,892 110,033 109,660 108,607 111,205 113,121 115,866 Restricted 44,188 16,754 16,496 19,849 19,803 8,803 24,412 27,012 27,082 56,061 Unrestricted (39,888) (7,184) (3,294) 475 (1,797) 6,712 (4,162) (4,102) 3,333 (21,076) Total governmental activities net position 118,448 120,376 124,458 129,216 128,039 125,175 128,857 134,115 143,536 150,851 Business-type activities
Net investment in capital assets 98,484 94,655 96,034 95,782 92,296 97,119 93,904 96,016 100,264 110,886 Restricted - - - - - - - - - -
Unrestricted (2,581) 2,587 5,524 9,085 20,058 19,821 27,642 34,895 43,746 40,898 Total business-type activities net position 95,903 97,242 101,558 104,867 112,354 116,940 121,546 130,911 144,010 151,784 Primary government
Net investment in capital assets 212,632 205,461 207,290 204,674 202,329 206,779 202,511 207,222 213,386 226,752 Restricted 44,188 16,754 16,496 19,849 19,803 22,228 24,412 27,012 27,082 56,061 Unrestricted (42,469) (4,597) 2,230 9,560 18,261 13,109 23,480 30,793 47,079 19,822 Total primary government net position 214,351 217,618 226,016 234,083 240,393 242,116 250,403 265,027 287,547 302,635 Fiscal Year
CITY OF WATSONVILLE, CALIFORNIA
Net Position By Component
Last Ten Fiscal Years
(accrual basis of accounting)
(amounts expressed in thousands)
125
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
$ $ $ $ $ $ $ $ $ $
Expenses:
Governmental activities:
General government 5,494 7,151 8,257 7,032 15,143 13,812 8,599 12,246 17,339 23,175 Public safety 25,716 27,751 27,382 30,972 31,221 35,811 35,608 33,149 35,379 39,040 Housing 1,298 1,389 2,318 1,158 2,289 2,059 24,412 3,255 1,191 1,777 Highways and streets 4,697 3,043 6,348 5,974 8,561 6,931 8,652 6,050 3,894 7,569 Culture and recreation 7,916 8,613 7,817 8,591 9,152 9,850 (4,162) 10,264 12,398 12,902 Interest on long term debt 132 112 146 158 491 78 123 42 35 16 Total government activities 45,253 48,059 52,268 53,885 66,857 68,541 73,232 65,006 70,236 84,479 Business-type activities:
Water 11,583 15,537 13,851 12,038 13,996 19,378 15,960 16,095 16,473 17,184 Sewer 10,741 10,731 10,272 13,175 14,195 14,099 14,190 13,633 14,509 18,956 Solid Waste 10,136 9,181 10,976 12,758 11,925 12,567 19,189 14,355 15,640 15,930 Airport 2,580 2,225 2,684 3,382 5,118 3,803 4,235 4,470 3,974 5,278 Fiber Optic - 8 41 46 68 59 69 64 62 77
Total business-type activities 35,040 37,682 37,824 41,399 45,302 49,906 53,643 48,617 50,658 57,425 Total primary government 80,293 85,741 90,092 95,284 112,159 118,447 126,875 113,623 120,894 141,904 Program Revenues:
Governmental activities:
Charges for services:
General government 5,488 5,524 8,426 8,285 12,233 8,649 9,181 9,420 13,642 13,344 Public safety 1,396 1,853 1,780 1,875 822 874 821 777 914 791 Housing 391 - 675 289 866 782 667 1,269 134 168
Highways and streets 1,585 1,858 2,284 2,663 1,057 799 64 34 244 145 Culture and recreation 1,330 833 952 1,189 1,244 832 606 669 479 1,090 Operating grants and contributions 2,393 3,590 3,310 2,772 2,501 5,988 5,100 3,541 3,621 1,984 Capital grants and contributions - - - - - - - - - -
Total governmental activates program revenues 12,583 13,658 17,427 17,073 18,723 17,924 16,439 15,710 19,034 17,522 Business-type activities:
Charges for services:
Water 12,075 12,756 14,617 15,243 17,358 20,484 19,885 21,045 22,041 21,109 Sewer 10,046 14,307 12,069 12,475 13,444 14,153 15,119 16,366 18,226 17,603 Solid Waste 10,471 10,746 11,225 12,549 13,493 14,587 18,310 16,116 16,946 18,989 Airport 1,956 2,159 1,937 2,576 5,595 3,713 2,432 2,706 2,799 2,971 Fiber Optic - 23 44 43 45 74 609 94 140 131
Operating grants and contributions 901 759 1,373 1,430 2,016 796 732 (20) 465 369 Capital grants and contributions 590 659 1,104 311 94 163 107 489 49 277 Total business-type activities program revenues 36,039 41,409 42,369 44,627 52,045 53,970 57,194 56,796 60,666 61,449 Continued
Fiscal Year
CITY OF WATSONVILLE, CALIFORNIA
Changes In Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
(amounts expressed in thousands)
126
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
$ $ $ $ $ $ $ $ $ $
Net (expense) / revenue
Governmental activities (32,670) (34,401) (34,840) (37,564) (48,134) (50,655) (46,217) (49,359) (51,409) (66,956) Business-type activities 999 3,727 4,544 3,227 6,744 4,065 3,551 8,179 10,008 3,697 Total primary government net expense (31,671) (30,674) (30,296) (34,337) (41,390) (46,590) (42,666) (41,180) (41,401) (63,259) General Revenues and Other Changes
in Net Position
Governmental activities:
Taxes
Property taxes 11,868 12,846 13,300 13,436 15,669 16,243 16,169 16,977 17,802 18,990 Sales taxes 13,988 16,693 16,083 18,393 19,369 19,075 22,232 24,408 25,337 32,590 Utility users taxes 3,437 3,183 3,679 4,019 4,011 4,265 3,994 4,144 4,358 4,676 Franchise taxes 404 456 471 436 460 458 563 538 572 669 Other taxes 1,295 1,457 1,792 2,060 3,125 2,906 2,610 3,618 3,694 3,789 Intergovernmental revenue not restricted 1,475 1,120 1,009 1,048 1,021 1,139 1,434 1,727 3,963 4,895 Transfers 226 232 308 270 272 251 246 284 285 285
Unrestricted investment earnings 1,916 2,098 2,218 2,660 3,030 3,416 2,531 2,857 4,449 8,376 Other revenue - - - - - - - - 31 -
Total governmental activities 34,609 38,085 38,860 42,322 46,957 47,753 49,779 54,553 60,491 74,270 Business-type activities:
Transfers (226) (231) (308) (270) (272) (251) (246) (284) (285) (285) Other Revenue - - - - - - 1,274 1,296 1,151 1,335
Unrestricted investment earnings 269 201 206 352 1,014 811 70 239 2,431 3,027 Total business-type activities 43 -30 (102) 82 742 560 1,098 1,251 3,297 4,077 Total primary government 34,652 38,055 38,758 42,404 47,699 48,313 50,877 55,804 63,788 78,347 Change in net position before extraordinary item
Governmental activities 1,939 3,683 4,020 4,758 (1,177) (2,863) 3,605 5,258 9,289 7,314 Business-type activities 1,043 3,696 4,442 3,309 7,486 4,586 4,606 9,366 13,099 7,774 Total primary government 2,982 7,379 8,462 8,067 6,309 1,723 8,211 14,624 22,388 15,088 Extraordinary items
Governmental activities - - - - - - - - - -
Total primary government - - - - - - - - - -
Change in net position
Governmental activities 1,939 3,683 4,020 4,758 (1,177) (2,863) 3,605 5,258 9,289 7,314 Business-type activities 1,043 3,696 4,442 3,309 7,486 4,586 4,606 9,366 13,099 7,774 Total primary government 2,982 7,379 8,462 8,067 6,309 1,723 8,211 14,624 22,388 15,088 Concluded
CITY OF WATSONVILLE, CALIFORNIA
Fiscal Year
(amounts expressed in thousands)
(accrual basis of accounting)
Last Ten Fiscal Years
Changes In Net Position
127
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
$ $ $ $ $ $ $ $ $ $
General fund
Nonspendable 35 3,365 2,965 2,588 123 114 308 147 - -
Restricted - - - - - - - - - -
Unassigned 4,595 4,228 6,057 10,342 13,144 16,478 18,253 18,228 21,626 34,011 Total general fund 4,630 7,593 9,022 12,930 13,267 16,592 18,561 18,375 21,626 34,011 All other governmental funds
Restricted, reported in
Special revenue funds 14,566 18,216 17,880 20,926 20,607 22,465 24,778 27,107 27,096 31,628 Debt service funds 72 125 131 123 129 238 247 246 324 322 Unassigned (1,069) (770) (740) (728) (615) (475) (404) (381) (338) (296) Total all other governmental funds 13,569 17,571 17,271 20,321 20,121 22,228 24,621 26,972 27,082 31,654 Fiscal Year
CITY OF WATSONVILLE, CALIFORNIA
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
(amounts expressed in thousands)
128
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
$ $ $ $ $ $ $ $ $ $
Revenues
Taxes 32,466 35,754 36,198 39,392 43,655 42,029 45,583 49,693 51,763 60,714 Licenses, permits, and fees 5,248 5,795 5,885 6,642 5,971 5,315 3,378 5,848 3,204 5,770 Intergovernmental 2,458 3,336 3,410 3,455 3,417 9,167 5,734 5,735 7,891 11,229 Charges for services 2,458 2,945 2,770 3,224 3,072 3,534 3,396 3,523 3,915 4,700 Fines 552 690 737 723 708 24,412 462 593 530 455
Interest 2,076 2,168 2,435 2,869 3,405 3,280 2,529 2,844 4,282 8,202 Special assessment 91 77 60 58 50 (4,162) - - - -
Miscellaneous 1,995 2,810 1,871 2,491 3,007 3,826 3,940 3,785 8,177 5,008 Total revenues 47,344 53,575 53,366 58,854 63,285 87,401 65,022 72,021 79,762 96,078 Expenditures
Current:
General government 5,574 6,989 7,556 7,978 13,062 11,330 10,089 14,262 19,000 19,394 Public safety 22,707 24,860 24,271 26,744 30,459 30,543 30,012 33,544 34,910 37,597 Housing 1,298 1,389 2,318 1,158 2,289 2,059 4,159 3,057 1,191 1,777 Streets 4,252 1,672 5,772 5,385 8,759 8,911 7,827 8,770 8,972 8,625 Culture and recreation 7,172 7,090 7,079 7,837 9,406 9,076 8,297 9,383 11,601 11,302 Debt service:
Principal 495 429 478 463 730 797 2,391 785 976 688
Interest and fiscal charges 159 183 173 161 220 82 147 49 37 23 Total expenditures 42,474 45,898 52,480 49,726 64,925 62,798 62,922 69,850 76,687 79,406 Excess (deficiency) of revenues
over (under) expenditures 4,870 7,677 886 9,128 (1,640) 24,603 2,100 2,171 3,075 16,672 Other financing sources (uses)
Bond/note proceeds - - - - 1,541 144 1,649 - - -
Transfers in 3,340 3,692 3,562 4,464 5,457 4,750 6,171 4,795 5,310 4,772 Transfers out (3,150) (3,496) (3,290) (4,230) (5,222) (4,535) (5,926) (4,510) (5,025) (4,487) Total other financing sources (uses) 190 196 272 234 1,776 359 1,894 285 285 285 Net change in fund balances before
extraordinary items 5,060 7,873 1,158 9,362 136 24,962 3,995 2,456 3,360 16,957 Extraordinary items - - - - - - - - - -
Net change in fund balances 5,060 7,873 1,158 9,362 136 24,962 3,995 2,456 3,360 16,957 Debt service as a percentage of **
noncapital expenditures 1.4% 1.6% 1.5% 1.4% 1.5% 1.4% 4.3% 1.2% 1.3% 0.7% ** Capital Outlay reconciliation amount was used for the percentage calculation. It reduced noncapital expenditures.
Fiscal Year
CITY OF WATSONVILLE, CALIFORNIA
Net Change in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
(amounts expressed in thousands)
129
Fiscal Property Sales Franchise Utility User Other
Year Tax Tax Tax Tax Tax Total
$ $ $ $ $ $
2015 11,868 13,988 404 3,437 1,295 30,992
2016 12,846 16,693 455 3,183 1,457 34,634
2017 13,300 16,083 471 3,679 1,793 35,326
2018 13,436 18,393 436 4,019 3,108 39,392
2019 15,669 19,369 460 4,011 3,125 42,634
2020 16,243 19,075 458 4,265 2,906 42,947
2021 16,169 22,232 563 3,994 2,610 45,568
2022 16,977 24,408 538 4,144 3,618 49,685
2023 17,802 25,337 572 4,358 3,694 51,763
2024 18,990 32,590 670 4,676 3,789 60,715
Source: City of Watsonville Finance Department
(amounts expressed in thousands)
CITY OF WATSONVILLE, CALIFORNIA
General Governmental Tax Revenues By Source
Last Ten Fiscal Years
(modified accrual basis of accounting)
130
Fiscal Total Estimated Assessed
Year Less: Taxable Direct Actual Value as a %
Ended Residential Commercial Industrial Other Unsecured Tax Exempt Assessed Tax Taxable of Actual June 30 Property Property Property Property Property Property Value Rate (1) Value Taxable Value $ $ $ $ $ $ $ % $ %
2015 2,316,558 548,165 106,401 350,110 231,586 185,687 3,367,133 1.18 3,367,133 1.00 2016 2,456,187 563,026 115,344 361,791 235,517 200,675 3,531,190 1.18 3,531,190 1.00 2017 2,606,044 626,252 135,130 394,814 229,211 229,936 3,761,515 1.16 3,761,515 1.00 2018 2,757,691 609,505 168,676 435,526 259,425 252,874 3,977,950 1.17 3,977,950 1.00 2019 2,727,533 583,841 442,945 421,714 262,350 222,957 4,215,426 1.16 4,215,426 1.00 2020 2,858,513 618,090 470,547 459,879 277,705 246,737 4,437,997 1.09 4,437,997 1.00 2021 3,002,026 640,089 485,947 410,766 276,813 205,383 4,610,258 1.16 4,610,258 1.00 2022 3,150,126 671,837 505,514 456,649 275,930 249,202 4,810,854 1.09 4,810,854 1.00 2023 3,288,822 757,157 515,612 507,728 290,464 307,240 5,052,543 1.16 5,052,543 1.00 2024 3,445,220 808,533 538,541 530,585 315,084 337,827 5,300,136 1.16 5,300,136 1.00 Notes:
Source: Previously published CAFR Reports
(1.) Total Direct Tax Rate is represented by TRA 02-021 Source: HDL, Coren & Cone
CITY OF WATSONVILLE, CALIFORNIA
Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years
(amounts expressed in thousands)
131
CITY OF WATSONVILLE, CALIFORNIA
Property Tax Rates - Direct
and Overlapping
(Per $100 of Assessed Value)
Last Ten Years
Basic
Countywide School
Year Levy Districts Retirement Total
2015 1.000 0.098 0.077 1.175
2016 1.000 0.101 0.077 1.178
2017 1.000 0.086 0.077 1.163
2018 1.000 0.094 0.077 1.171
2019 1.000 0.081 0.077 1.158
2020 1.000 0.087 0.077 1.164
2021 1.000 0.084 0.077 1.161
2022 1.000 0.090 0.077 1.167
2023 1.000 0.085 0.077 1.162
2024 1.000 0.082 0.077 1.159
Source: HDL, Coren & Cone
132
Percentage of Percentage of
Taxable Total Taxable Taxable Total Taxable
Assessed Assessed Assessed Assessed
Value Rank Value Value Rank Value
$ % $ %
S Martinelli And Company 58,912 1 1.18% 41,121 2 1.28%
MPT of Watsonville 48,313 2 0.97%
OW Family-Lee Road LLC 31,444 3 0.63%
Freedom Associates LLC 31,100 4 0.62% 22,485 3 0.70%
Blackbird Homes LLC 28,278 5 0.57%
WRI Freedom Center LP 27,479 6 0.55% 18,098 7 0.56%
Save Mart Portfolio Owner Fund V Ca 26,010 7 0.52%
111 Jenning Drive LLC 24,162 8 0.48%
Home Depot USA 22,513 9 0.45%
Granite Construction Inc 19,951 10 0.40%
Watsonville Hospital Corp 60,482 1 1.88%
Harvest Drive Properties LLC 20,237 5 0.63%
George Ow Jr Trustee ET AL 17,108 8 0.53%
Terminal Freezers LLC 21,419 4 0.67%
Home Depot Dev of Maryland INC 16,700 6 0.52%
Fox Factory Inc 16,009 9 0.46%
Dayton Hudson Corporation 15,897 10 0.49%
Totals 318,162 6.37% 249,556 7.72%
Source: HDL, Coren & Cone
2024 2015
CITY OF WATSONVILLE, CALIFORNIA
Principal Property Taxpayers
June 30, 2024
(amounts expressed in thousands)
133
Percent Supplemental Delinquent
Fiscal Total * Current Tax * Of Levy Tax Tax * Total Tax Year Tax Levy Collections Collected Collections Collections Collections $ $ $ $ $ $
2015 7,837,187 7,837,187 100% 112,079 - 7,949,266
2016 7,801,004 7,801,004 100% 117,264 - 7,918,268
2017 8,615,411 8,615,411 100% 200,484 - 8,815,895
2018 8,605,570 8,605,570 100% 225,296 - 8,830,866
2019 10,536,951 10,536,951 100% 238,730 - 10,775,681
2020 10,859,042 10,859,042 100% 212,455 - 11,071,497
2021 10,732,446 10,732,446 100% 127,234 - 10,859,680
2022 11,026,084 11,026,084 100% 352,022 - 11,378,106
2023 11,707,891 11,707,891 100% 296,479 - 12,004,370
2024 12,654,817 12,654,817 100% 270,050 - 12,924,867
Source: City of Watsonville
*Property Tax collection equals property Tax collected due to agreement with the County of Santa Cruz.
With this agreement the City does not receive any Delinquent tax collection.
CITY OF WATSONVILLE, CALIFORNIA
Property Tax Collection
Last Ten Fiscal Years
134
General Special Total Percentage
Fiscal Obligation Assessment Capital Revenue Loans & Capital Primary of Personal Per Year Debt Debt Leases Bonds Notes Leases Government Income Capita $ $ $ $ $ $ $
2015 4,676 290 - 29,057 11,124 - 45,147 5.22% 0.875
2016** 4,254 214 - 677 347 - 5,492 0.59% 0.104
2017 3,818 149 - 461 582 - 5,010 0.50% 0.092
2018 3,406 98 - 235 922 - 4,661 0.47% 0.090
2019 4,283 49 - - 1,639 - 5,971 0.59% 0.113
2020 3,679 - - - 1,693 - 5,372 0.50% 0.104
2021 2,938 - - - 8,150 - 11,088 1.24% 0.216
2022 2,153 - - - 7,371 - 9,524 0.94% 0.219
2023 2,243 - - - 12,633 - 14,876 1.17% 0.298
2024 1,555 - - - 11,749 - 13,304 0.94% 0.261
Note: Details regarding the city's outstanding debt can be found in the notes to the financial statements. 1 See the Schedule of Demographic and Economic Statistics for the personal income and population data.
Governmental Activities Business-Type Activities
CITY OF WATSONVILLE, CALIFORNIA
Ratio of Outstanding Debt By Type
Last Ten Fiscal Years
(amounts expressed in thousands, except per capita amount) 135
Percentage of
Estimated
General Less:Amounts Actual Taxable
Fiscal Obligation Available in Debt Value of Per
Year Debt Service Fund Total Property Capita
$ $ $ $
2015 4,676 72 4,604 0.15% 1,121
2016 4,254 125 4,129 0.13% 1,250
2017 3,818 131 3,687 0.12% 1,438
2018 3,406 123 3,283 0.09% 1,615
2019 4,283 129 4,154 0.10% 1,276
2020 3,679 238 3,441 0.08% 1,497
2021 2,938 247 2,691 0.06% 1,909
2022 2,153 246 1,907 0.04% 2,657
2023 2,243 324 1,919 0.04% 2,599
2024 1,555 322 1,233 0.02% 4,139
Note: Detail of the City's outstanding debt can be found in the notes to the financial statements.
See the Schedule of Assessed Value and Estimated Actual Value of Taxable Property for estimated actual property value data.
Population data can be found in the Schedule of Demographic and Economic Statistics
CITY OF WATSONVILLE, CALIFORNIA
Ratio of Net General Obligation Debt Outstanding
Last Ten Fiscal Years
(amounts expressed in thousands, except per capita amount) 136
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
$ $ $ $ $ $ $ $ $ $
Debt limit 133,232 139,945 149,679 158,656 166,439 175,678 181,450 189,752 200,992 211,424 Total net debt applicable to limit 4,676 4,129 3,687 3,283 4,154 3,441 2,691 1,907 1,919 1,233 Legal debt margin 128,556 135,816 145,992 155,373 162,285 172,237 178,759 187,845 199,073 210,191 Total net debt applicable to the limit 3.510% 2.950% 2.463% 2.069% 2.496% 1.959% 1.483% 1.005% 0.955% 0.583% as a percentage of debt limit
Legal Debt Margin Calculation for Fiscal Year 2023
Assessed value $ 5,300,136
Add back: exempt real property 337,827
Total assessed value 5,637,963
Debt Limit = 3.75% of assessed valuation 211,424
Debt applicable to limit 1,555
Less: Amount set aside for repayment of
general obligation debt 322
Total net debt applicable to limit 1,233
Legal debt margin $ 210,191
Source: City of Watsonville
Fiscal Year
(amounts expressed in thousands)
Last Ten Fiscal Years
Legal Debt Margin Information
CITY OF WATSONVILLE, CALIFORNIA
137
Estimated
Total (1) Share of
Debt Percentage Overlapping
Jurisdiction Outstanding Applicable Debt
$ $
Direct Debt:
City of Watsonville 5,300 100% 5,300
Total of Direct Debt 5,300
Overlapping Tax Debt:
Cabrillo Joint Community College District 91,587 5.98% 5,479 Pajaro Valley Unified School District 155,583 26.42% 41,097 Santa Cruz County General Fund
Obligations 167,498 9.06% 15,169
Santa Cruz County Office of Education
General Fund Obligations 6,612 9.06% 599
Pajaro Valley Joint Unified School District
Certificates of Participation 11,170 26.42% 2,951
City of Watsonville General
Fund Obligations (2) 1,943 100.00% 1,943
Successor Agency 4,030 100.00% 4,030
(3)
Total Overlapping Debt 438,423 71,267
Total Direct and Overlapping Bonded Debt 443,723 71,272 Source: Wildan Financial Services
(1) The percentage of overlapping debt applicable to the city is estimated using taxable assessed property value.
Applicable percentages were estimated by determining the portion of the overlapping district's assessed value that is within the boundaries of the city divided by the district's total taxable assessed value. (2) Includes share of Santa Cruz County Emergency Communications Center obligations ($392,713). (3) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage reveue and non-bonded capital lease obligations.
CITY OF WATSONVILLE, CALIFORNIA
Computation of Direct and Overlapping Bonded Debt
June 30, 2024
(amounts expressed in thousands, except per capita amount) 138
Education
Personal (2) Per Level in
Income Capita Years of
Fiscal (amounts expressed Personal Median Formal School (4) Unemployment Year Population (1) in thousands) Income Age (3) Schooling Enrollment Rate (5) $ $
2015 52,087 864,719 16.601 29 N/A 20,438 19.2%
2016 52,891 934,271 17.664 29.9 N/A 20,354 19.2%
2017 53,015 981,527 18.514 30.1 N/A 20,400 19.2%
2018 53,434 1,052,216 19.692 29.7 N/A 20,279 19.3%
2019 53,021 1,014,448 19.133 29.7 N/A 20,106 10.4%
2020 51,515 1,068,567 20.742 30.3 N/A 18,616 10.1%
2021 51,366 1,122,733 21.857 30.3 N/A 19,772 14.8%
2022 50,669 1,183,950 23.366 30.9 N/A 18,675 13.6%
2023 49,876 1,270,289 25.468 31.1 N/A 18,094 10.3%
2024 51,032 1,415,139 27.730 33 N/A 17,452 11.0%
Source: MuniServices, LLC & Data Reporting Office Ca. Dept of Ed.
1.) Population Projections are provided by the California Department of Finance Projections.
2.) Income Data is derived from previous income adjusted for inflation.
3.) Unemployment Data is provided by the EDD's Bureau of Labor Statistics Department.
CITY OF WATSONVILLE, CALIFORNIA
Demographic and Economic Statistics
Last Ten Fiscal Years
4.) Student Enrollment reflects the total number of students enrolled in the Pajaro Valley Unified School District. Other School Districts w/in the City are not accounted for in this statistics. 139
Percentage Percentage
of Total City of Total City
Employees Rank Employment Employees Rank Employment
Pajaro Valley Unified School District 2,269 1 9.78% 2,022 1 9.19% Watsonville Community Hospital 638 2 2.75% 613 2 2.79%
Granite Construction 521 3 2.25%
Del Mar Food Products, Inc 450 4 1.94%
City of Watsonville * 406 5 1.75% 369 4 1.68%
Lakeside Organic Gardens LLC 276 6 1.19%
Nordic Naturals, Inc 263 7 1.13%
S Martinelli & Co. 241 8 1.04% 280 6 1.27%
FedEx Ground Package Systems, INC 240 9 1.03%
A & I Transport INC 227 10 0.98%
West Marine Products 372 3 1.69%
Fox Factory 300 5 1.36%
Salud Para La Gente 248 7 1.13%
Green Valley Clinic 248 8 1.13%
Clinica Del Valle Del P 186 9 0.85%
Community Bridges 181 10 0.82%
Total 5,531 23.84% 4,819 21.91%
* Includes Certificated, classified & Admin.
**Includes contractors.
(1) Total City Labor Force provided by EDD Labor Force Data https://www.labormarketinfo.edd.ca.gov/data/labor-force-and-unemployment-for-cities-and-census-areas.html Source: 2012-2013 previously published CAFR
Source: BL Data, MuniServices, LLC & Called Employers
2024 2015
CITY OF WATSONVILLE, CALIFORNIA
Principal Employers
Current Fiscal Year and Ten Years Ago
140
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Function
General Government 7 7 9 9 9 9 10 11 11 11
Community Development 13 11.5 14 15 16 16 12 15 15 15
Finance 16 16 10 10 11 11 10 10 10 10
Fire 41 41 40 42 43 43 31 31 32 32
Informaion Services * n/a n/a 8 8 8 9 11 16 16 13
Police:
Officers 64 67.2 66 75 75 75 71 75 78 77
Civilians 22 26 27 22 24 23 21 19 19 20
Library 29 27.41 25 25 26 27 23 22 22 24
Parks & Community
Services 27 25.88 26 29 29 26 22 24 28 27
Public Works 16 14 14 13 15 15 15 12 13 14
Airport 9 9 9 10 13 13 10 11 10 11
LLMAD 1 1 1 1 1 1 1 1 1 1
Gas Tax n/a n/a 0 2 4 4 3 3 3 3
Parking Garage 0 0 0 0 0 0 0 0 0 0
Redevelopment and
Housing 4 5.2 3 4 4 4 5 4 4 4
Solid Waste 36 44 46 49 43 43 43 44 45 38
Wastewater 47 49 53 55 59 59 52 53 53 67
Water 34 35 38 41 44 44 44 39 37 39
366 379.2 389 410 424 422 384 390 397 406
* Information Services was created and moved out of General Government.
Source: City of Watsonville's Biennial Budget documents.
CITY OF WATSONVILLE, CALIFORNIA
Full-time Equivalent City Government Employees by Function Last Ten Fiscal Years
141
CITY OF WATSONVILLE, CALIFORNIA
Operating Indicators by Function
Last Ten Fiscal Years
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Function
General Government:
City Council meetings 27 19 21 25 25 23 22 34 31 24
Resolutions processed 181 199 187 192 180 229 282 285 261 256 Community Development:
Planning application reviews 393 361 369 423 442 396 230 501 472 405 Construction inspections 1,725 1,165 2,933 3,828 3,624 2,904 1,029 3,557 3,537 5,090 Building Permits 768 817 862 1,034 810 758 1,493 927 1,104 944 Finance:
Payroll checks issued 12,327 12,511 12,547 13,323 13,028 13,045 11,200 12,973 12,973 13,344 Utility accounts 15,023 15,024 14,985 15,043 15,070 14,556 14,474 14,104 14,610 15,017 A/P checks issued 7,313 7,517 7,644 7,588 8,062 7,695 6,890 6,904 6,919 6,874 Fire:
Field incidents dispatched 4,282 4,282 4,997 5,070 5,286 5,427 6,539 6,271 5,658 6,136 Information Services:
Client Computers 542 531 531 646 646 682 698 609 646 553 Library:
Items used/checked out 411,234 411,234 439,234 272,468 326,888 303,137 34,242 53,238 134,413 133,671 Parks & Community Services:
Registered Participants 549 475 479 413 297 335 48 1,972 2,296 4,127 Police:
Moving and Parking Citations 10,524 11,105 12,747 9,600 15,659 9,738 8,721 15,466 7,867 10,486 Service Calls Dispatch 65,288 69,668 67,632 65,635 44,386 56,901 53,730 54,239 52,215 47,210 URC Crime Rate 39 40 43 38 34 34 30 28 31 31
(# crimes/1,000 population, calendar years)
Wastewater:
Avrg. Annual volume per day septage
treated (in million gallons) 8 3 3 4 5 5 6 8 9 8
Water:
Water production (acre feet) 7,163 6,597 6,648 7,102 6,906 7,882 7,100 6,950 6,348 6,603 Solid Waste:
Refuse handled (tons) 40,204 41,389 36,028 34,286 35,109 35,202 39,898 33,373 32,699 31,927 Recycled material (tons) 4,946 7,466 7,081 8,188 7,070 6,050 5,808 7,869 11,221 11,014 Source: City of Watsonville departments
142
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Function
Fire:
Stations 2 2 2 2 2 2 2 2 2 2
Police:
Patrol units 17 17 17 22 22 22 22 26 25 24
Patrol motorcycles 4 5 5 5 5 6 6 5 7 7
Library:
Buildings 2 2 2 2 2 2 2 2 2 2
Parks & Community Services:
Parks 26 26 26 26 26 26 26 26 26 26
Acreage of parks 143.0 143.0 143.0 143.0 143.0 143 143 143.0 143.0 143.0 Community Centers 5 5 5 5 6 8 8 7 7 5
Public Works:
Miles of streets 89 89 89 89 89 89 89 84 84 84
Airport:
Runways 2 2 2 2 2 2 2 2 2 2
Wastewater:
Treatment plants 1 1 1 1 1 1 1 1 1 1
Capacity of treatment plant* 12.1 12.1 12.1 12.1 12.1 12.1 12.1 12.1 12.1 12.1 *(gallons per day in millions)
Water:
Maximum pumping capacity* 19.1 19.1 19.1 19.1 19.1 19.1 19.1 19.1 19.1 19.1 Average consumption* 6.1 5.9 5.9 5.9 6.2 7 7 6 6 6
*(gallons per day in millions)
Solid Waste:
Collection trucks 16 19 19 20 20 25 25 25 25 25
Source: City of Watsonville departments
CITY OF WATSONVILLE, CALIFORNIA
Capital Assets Statistics by Function
Last Ten Fiscal Years
143
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City of Watsonville, California
Measure Y Fund
Financial Statements
For the Year Ended June 30, 2024
The Page Left Intentionally Blank
CITY OF WATSONVILLE
MEASURE Y FUND
FINANCIAL STATEMENTS
For the Year ended June 30, 2024
Table of Contents
Independent Auditor’s Report .............................................................................................................................. 1 Financial Statements:
Balance Sheet ........................................................................................................................................ 3 Statement of Revenues, Expenditures, and Change in Fund Balance .................................................. 4 Statement of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual ......................................................................................................................... 5 Notes to the Financial Statements ......................................................................................................... 7 Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ............................................................ 9
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INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and Members of City
Council of the City of Watsonville, California
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statements of the Measure Y Fund (the Fund) of the City of Watsonville, California (City), as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the Fund’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 Fund as of June 30, 2024, and the change in the financial position and budgetary comparison listed in the Table of Contents as part of the basic financial statements 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 and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirement relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Emphasis of a Matter
As discussed in Note 1, the financial statements present only the Fund and do not purport to, and do not present fairly the financial position of the City as of June 30, 2024, the changes in its financial position, for the year then ended in accordance with accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter.
Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.
1 Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists.
The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed.
• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report December 27, 2024, on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’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 City’s internal control over financial reporting and compliance.
Pleasant Hill, California
December 27, 2024
2 ASSETS
Cash and investments 2,104,749 $
Taxes receivable 930,003
Total Assets $ 3,034,752
LIABILITIES
Accounts and retentions payable $ 146,746
Accrued personnel costs 63,640
Total Liabilities 210,386
FUND BALANCE
Restricted for:
Fire services 1,620,121
Police services 611,859
Parks and recreation 592,386
Total Fund Balance 2,824,366
TOTAL LIABILITIES AND FUND BALANCE $ 3,034,752
See accompanying Notes to Basic Financial Statements.
CITY OF WATSONVILLE
MEASURE Y FUND
BALANCE SHEET
June 30, 2024
(FORMERLY KNOWN AS MEASURE G)
3 AND CHANGE IN FUND BALANCE
REVENUES
Sales tax - Fire 1,994,790 $
Sales tax - Police 2,834,702
Sales tax - Parks and Recreation 419,956
Interest - Fire 38,990
Interest - Police 27,438
Interest - Parks and Recreation 5,776
Other revenue - Police 1,377
Total Revenues 5,323,029
EXPENDITURES
Fire 1,820,534
Police 3,652,421
Parks and Recreation 303,441
Total Expenditures 5,776,396
NET CHANGE IN FUND BALANCE (453,367)
FUND BALANCE
Beginning Fund Balance 3,277,733
Ending Fund Balance $ 2,824,366
See accompanying Notes to Basic Financial Statements.
CITY OF WATSONVILLE
MEASURE Y FUND
STATEMENT OF REVENUES, EXPENDITURES,
For The Year Ended June 30, 2024
(FORMERLY KNOWN AS MEASURE G)
4 CITY OF WATSONVILLE
MEASURE Y FUND
(FORMERLY KNOWN AS MEASURE G)
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGE IN FUND BALANCE - BUDGET AND ACTUAL
For The Year Ended June 30, 2024
Variance
Final Favorable
REVENUES Budget Actual (Unfavorable)
Sales tax - Fire 1,974,860 $ 1,994,790 $ 19,930 $
Sales tax - Police 2,814,689 2,834,702 20,013
Sales tax - Parks and recreation 415,760 419,956 4,196
Interest - Fire 5,000 38,990 33,990
Interest - Police 15,000 27,438 12,438
Interest - Parks and recreation 1,000 5,776 4,776
Other revenue - Police 100 1,377 1,277
Total Revenues 5,226,409 5,323,029 96,620
EXPENDITURES
Fire:
Salaries and Wages 1,145,159 1,162,739 (17,580)
Operations 488,120 442,046 46,074
Capital Outlay 1,266,989 215,749 1,051,240
Total Fire 2,900,268 1,820,534 1,079,734
Police:
Salaries and Wages 1,919,440 1,853,271 66,169
Operations 920,401 825,420 94,981
Capital Outlay 1,833,383 973,730 859,653
Total Police 4,673,224 3,652,421 1,020,803
Parks and Recreation:
Salaries and Wages 108,515 75,679 32,836
Operations 308,245 227,762 80,483
Total Parks and Recreation 416,760 303,441 113,319
Total Expenditures 7,990,252 5,776,396 2,213,856
NET CHANGE IN FUND BALANCE $ (2,763,843) (453,367) (2,310,476) $
FUND BALANCE
Beginning Fund Balance 3,277,733
Ending Fund Balance $ 2,824,366
See accompanying Notes to Basic Financial Statements.
5 The Page Left Intentionally Blank
CITY OF WATSONVILLE
MEASURE Y FUND
(FORMERLY KNOWN AS MEASURE G)
NOTES TO THE BASIC FINANCIAL STATEMENTS
June 30, 2024
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
In the June 3, 2014 election, City of Watsonville (City) voters approved Measure G, establishing a temporary half-cent transaction sales and use tax. The Measure G Fund (Fund) was established to accumulate revenues transmitted by the State Board of Equalization (BOE), the agency responsible for administering and collecting the transactions and use taxes for the City, and apportion them to essential services outlined within the approved expenditure plan.
On March 3, 2020, City voters approved Measure Y to renew and continue the half-cent transaction sales and use tax. The fund was used to accumulate revenues transmitted by the BOE and apportion them to essential services outlined within the approved expenditure plan.
The financial statements present only the activities of the Measure Y Fund, and are not intended to present the financial position and changes in financial position of the City of Watsonville, in accordance with accounting principles generally accepted in the United States of America.
B. Basis of Accounting
The Measure Y Fund of the City is maintained on the modified accrual basis of accounting. As such, revenues are recognized when they become susceptible to accrual, that is, when they become both measurable and available to finance expenditures of the current period. Expenditures are recognized in the accounting period in which the liability is incurred (when goods are received or services rendered).
C. Estimates
The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.
NOTE 2 - CASH AND INVESTMENTS
Cash and investments at June 30, 2024, consist of the following:
Pooled cash and investments with the
City of Watsonville $2,104,749
Please refer to the notes of the City's June 30, 2024 Annual Comprehensive Financial Report regarding cash and investments for additional detail.
7 The Page Left Intentionally Blank
INDEPENDENT AUDITOR’S REPORT ON
INTERNAL CONTROL OVER FINANCIAL REPORTING
AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN
AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE
WITH GOVERNMENT AUDITING STANDARDS
To the Honorable Mayor and Members of City Council of
the City of Watsonville, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the basic financial statements of the City of Watsonville (City) Measure Y Fund (the Fund) as of and for the year ended June 30, 2024, and have issued our report thereon December 27, 2024.
Report on Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the Fund’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. We identified a deficiency in internal control that we consider to be a material weakness as listed on the Schedule of Material Weakness included as part of our separately issued Memorandum on Internal Control December 26, 2024, which is an integral part of our audit and should be read in conjunction with this report.
9 Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Fund’s financial statements are free from material misstatement, we performed tests of the City’s compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. We have also issued a separate Memorandum on Internal Control dated December 26, 2024, which is an integral part of our audit and should be read in conjunction with this report.
City’s Response to Findings
Government Auditing Standards require the auditor to perform limited procedures on the City’s response to the findings identified in our audit and described in our separately issued Memorandum on Internal Control December 26, 2024, which is an integral part of our audit and should be read in conjunction with this report. The City’s response was not subjected to the other auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on the response.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Pleasant Hill, California
December 27, 2024
10 Reso No. (CM)
C:\Program Files\eSCRIBE\TEMP\201291550\201291550,,,MID YEAR RESOLUTION.docx ri 2/20/2025 8:01:04 PM
1 RESOLUTION NO.__________ (CM)
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
WATSONVILLE AMENDING THE 2024-25 BUDGET TO AUTHORIZE
$6,398,664 BUDGET APPROPRIATION INTO VARIOUS FUNDS AND TO
AUTHORIZE THREE ADDITIONAL POSITIONS
Amends Resolution No. (CM)
WHEREAS, on June 25, 2024, the City Council adopted Resolution No. (CM) approving the Final Budget for the City of Watsonville for fiscal year 2024-25; and WHEREAS, current projections show that without budget adjustments, departments will go over budget by the end of the fiscal year; and WHEREAS, City staff recommends some increases and three additional positions to departmental budgets to meet increases in demand for services.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WATSONVILLE, CALIFORNIA, AS FOLLOWS:
That the City Council hereby authorizes certain budget appropriations and new positions for fiscal year 2024-25, as fully described on Exhibit “A,” attached hereto and incorporated herein for fiscal year ending June 30, 2025. ********************************
ACFR FY 23-24 and Mid Year
Financial Report FY 24-25
Marissa Duran, Finance Director
February 25, 2025
RECOMMENDED
ACTIONS
• Accept by motion, the Annual Comprehensive
Financial Report for FY 2023-24, and
• Accept by motion, the mid-year financial
report for the 2024-25 Fiscal Year:
• Accept by motion, the Annual Measure Y Audit
Report for FY 2023-24, and
• Approve a resolution appropriating $6,398,664
including 3 additional positions
ACFR Online
• - Watsonville ACFR FY24
(06/30/2024 City of
Watsonville FY24 AUD
[6/30/2024]
Background
• Independent Audit by Maze & Associates
• The audit resulted in an UNQUALIFIED OPINION
– which means we followed generally accepted
accounting principles, our financials are free
from material errors and our Financial
Statements present fairly
• Additionally, we have received an Award for
Excellence in Financial Reporting for 27 years in
a row
2024 ACFR
Use of
Fund
Balance
Note: Hospital Loan
Guarantee, we do not
anticipate using but
have identified for
good practice.
General Fund Revenues
Department
Actuals
FY 2024
Revised
Budget Projection Variance
Revenues:
Property Tax 14,788,668 14,797,577 14,943,741 146,164
Sales Tax-General 15,936,386 14,974,566 15,596,717 622,151 Hotel Room Tax 1,412,314 1,600,000 1,600,000 -
Utility User Tax 4,675,775 4,400,000 4,769,979 369,979
Transfers In 3,993,020 4,264,868 4,249,900 (14,968)
Measure R 6,190,360 5,518,000 5,403,984 (114,016)
Total Revenues 46,996,523 45,555,011 46,564,321 1,009,310 CDD 2,433,199 2,355,600 1,781,992 (573,608)
Police 1,608,643 1,707,297 1,441,599 (265,698)
Fire 465,725 509,592 972,679 463,087
PW 44,078 522,742 82,122 (440,620)
PCS 804,092 960,363 627,513 (332,850)
Other 15,434,439 8,981,717 9,673,042 691,325
Total GF Revenue 67,786,699 60,592,322 61,143,269 550,947 General Fund Estimate Expenditures and Revenues
Fiscal Year Ending June 30, 2025
Revenues cont.
On the “Other Revenues” category
Reminder, these are Leases, Business License, Franchise Fees agreements, etc.
The City is currently focusing on the economic development side, we are currently recruiting this this position in our City Manager’s Office – this is the key going forward to building more revenue capacity
General
Fund
Revenues
General Fund Revenues - Overall
Property tax is projected to be just slightly overbudget Sales tax is projected to be $622k over budget, Statewide this revenue stream has seen decreases, but our auto sales are outpacing statewide sales and keeping us within budget projections Utility tax is projected to be $370k over budget
Hotel tax is projected on budget, 6 hotels remitting
Measure R - $5.4MM second full year
Department Revenues, CDD, Police and PCS lower than budgeted, Fire over $463k mutual aid
Sales Tax
Per Capita
Sales of
Surrounding
Cities
General Fund
Expenditures
Department
Actuals
FY 2024
Revised
Budget Projection Variance
Revenues:
Property Tax 14,788,668 14,797,577 14,943,741 146,164
Sales Tax-General 15,936,386 14,974,566 15,596,717 622,151 Hotel Room Tax 1,412,314 1,600,000 1,600,000 -
Utility User Tax 4,675,775 4,400,000 4,769,979 369,979
Transfers In 3,993,020 4,264,868 4,249,900 (14,968)
Measure R 6,190,360 5,518,000 5,403,984 (114,016)
Total Revenues 46,996,523 45,555,011 46,564,321 1,009,310 CDD 2,433,199 2,355,600 1,781,992 (573,608)
Police 1,608,643 1,707,297 1,441,599 (265,698)
Fire 465,725 509,592 972,679 463,087
PW 44,078 522,742 82,122 (440,620)
PCS 804,092 960,363 627,513 (332,850)
Other 15,434,439 8,981,717 9,673,042 691,325
Total GF Revenue 67,786,699 60,592,322 61,143,269 550,947 Expenditutres
Actuals
FY 2024 Budget Projection Variance
City Council 125,142 296,825 126,876 169,949
City Manager 1,831,926 1,896,960 1,896,960 -
City Clerk 895,580 1,161,910 892,966 268,944
City Attorney 163,010 603,757 177,076
Community Development 3,086,169 3,355,522 2,800,956 554,566 Finance 1,564,016 1,898,810 1,870,914 27,896
Human Resources 894,256 913,185 913,185 -
Social Services 239,436 279,415 222,160 57,255
Parks & Community Services 5,085,654 6,009,647 5,638,562 371,085 Fire 9,344,775 9,239,593 9,731,385 (491,792)
Library 541,684 593,584 593,584 -
Non-Department 3,498,748 2,854,728 2,839,876 14,852
Police 22,539,380 24,034,535 23,475,641 558,894
Public Works 1,754,656 2,120,709 2,093,661 27,048
Measure R 853,048 3,213,441 1,228,270 1,985,171
Total Depts 52,417,480 58,472,621 54,502,072 3,543,868
Capital 2,192,797 6,410,095 4,000,000 2,410,095
Capital-Measure R 919,105 5,364,554 536,404 4,828,150
Total Expenditures 54,610,278 70,247,270 59,038,476 10,782,114 YE Change to Fund Balance 13,176,421 (9,654,948) 2,104,793 Capital Carry Forward 7,238,245
Measure R
SALES TAX - MEASURE R
BEGINNING FUND BALANCE 4,762,529.65
FY 2025 PROJECTED REVENUES 5,403,984.42
OPERATIONS
DEBT SERVICE 1,500,000.00
LIBRARY 350,000.00
PARKS 1,363,411.00
TOTALS 3,213,411.00
Budgeted Projects
PARKS - PINTO LAKE MASTER PLAN 200,000.00
PARKS - PARK ASSESSMENT CIPS 500,000.00
PARKS - CALLAGHAN COURT CONVER 100,000.00
LIBRARY DESIGN DOCUMENTS ARCH 214,000.00
OTHER CONTRACT SERVICES 26,971.00
OHLONE PRK ST IMPROVEMENTS 10,285.00
FIELD SERVICES CONTAINER TRUCK 66,106.00
AUTOMOTIVE EQUIPMENT 160,000.00
GREEN VALLEY ROAD IMPROVEMENTS 517,432.00
BRIDGE STREET RECONSTRUCTION 930,000.00
RAMSAY PARK - MASTER PLAN NATU 683,000.00
STREETS - OTHER 83,998.00
STREETS/SIDEWALKS-TRAILS 34,162.00
NATURE CENTER BUILDING 1,838,600.00
NEW STREETS APPROPRIATION REQUEST 505,000.00
TOTALS 5,869,554.00
BUDGET RESERVES 1,080,796.88
UNRESERVED FUND BALANCE 2,752.19
Measure R Projects
• Nature Center - has the largest piece of the pie – they are currently in design, you may recall we scratched our prior design as that came in $7MM over budget- coming in 2
nd is Street Work for Green Valley and Bridge Street and also were able to complete Ohlone project
• Library – working on their 2
nd floor atrium – more outdoor sitting, outdoor
programming venues, bistro café - we will see an appropriation to request in our next year budget for this
• Asking for a new appropriation for Streets in the amount of $505k – funds will be used for maintenance projects throughout the City
Staff Request
POLICE REQUESTS
Swapping Police Sergeant position with Police Sergeant
Police Civilian Manager
Investigative Specialist
Continue with the Hiring Pause through end of fiscal year
General Fund Appropriations Requests
• Other –Settlement - $340k Settlement-Legal Costs $400k • City Manager’s Office – Wayfinding $2MM, Homelessness efforts $142k for warming shelter and other programs
• Fire – Overtime Costs - $600k, we are seeing a very high spike due to mutual aid and other reasons, backed by $463k worth of revenues • Parks – Appropriating a Friends of Watsonville - $22k • Police –Swapping Police Sergeant position with Police Civilian Manager and Investigative Specialist
Enterprise Funds
Other Funds
Department Description Expense Revenues
Police RFID Readers at both parking gates 25,000.00
Pistol Replacement 68,000.00
Parks Bay Breeze 30,000.00
Vista Montana 43,000.00
IT Computer Replacement 120,000.00
Public Works Parts & supplies 100,000
Increase disposal costs 1,093,500
Temporary wages 45,000
Repair & Maintenance - Uniforms 3,000
ES Engineering 90,000
Fuels & Lubricants 30,000
Landfill Cell IV Opening 218,396
Landfill Closure 82,271
Wastewater Operator 1- temporary overhire
Airport Fuel Farm 170,000
2,118,167.00 -
Internal Service Funds
Information and Technology – continuing modernization efforts through collaboration with various departments to transition the on-premises ERP system to a Software as a Service (SaaS) solution. This migration aligns with the city’s cybersecurity initiatives, enhances software availability, and provides the opportunity to implement new modules that streamline processes, reduce paperwork, and increase operational efficiencies through automated workflows.
MSC Vehicle Shop – This division services our departments. The department has recently completed a fleet study, this will help facilitate our budget process for vehicle replacement.
Internal Service Funds
Other Funds
Measure Y
Outlook and Caution
PERS Unfunded Liability – liability over 20 years.
Capital needs – working on Ramsay, Nature Center, City Plaza and Street Projects– will be bringing Financing request soon
Labor Negotiations – City has results of Compensation and Classification Study, building capacity to be able to address issues identified Unknown Costs- NextGen, RFP currently being issued, and entire system has to be upgraded
Action Items for Today
Accept by motion, the
Annual Comprehensive
Financial Report for FY
2023-24, and
Accept by motion, the
mid-year financial
report for the 2024-25
Fiscal Year:
Accept by motion, the
Annual Measure Y Audit
Report for FY 2023-24,
and
Approve a resolution
appropriating
$6,398,664 including 3
additional positions