111 E. Commercial Street
Willits, California 95490
Tel | 707.459.4601
Fax | 707.459.1562
www.cityofwillits.org
WILLITS CITY COUNCIL
AGENDA
APRIL 23, 2025 | 6:30 PM | CITY COUNCIL CHAMBERS
1. OPENING MATTERS
a. Call to Order. | b. Pledge to Flag. | c. Roll Call.
2. PUBLIC COMMUNICATIONS
The City Council welcomes input from the audience. If there is a matter of business on the agenda that you are interested in, you may address the Council when this matter is considered. If you wish to speak on a matter that is not on the agenda, you may do so at this time. In order for everyone to be heard, please limit your comments to three (3) minutes per person. The Brown Act regulations do not allow action to be taken on audience comments in which the subject is not listed on the agenda.
Members of the public are asked to observe the rules of decorum. While the City Council welcomes public criticism of policies, procedures, programs, or services of the agency; behavior that disrupts, disturbs, impedes, or renders infeasible the orderly conduct of the meeting and that includes, but is not limited to use of profanity, slurs, yelling from the audience, threatening remarks, physically threatening conduct, or physical or verbal displays of disrespect, will not be tolerated and the individual will be removed immediately.
3. PUBLIC MATTERS
a. Discussion and Possible approval of an At-Will Employment Agreement with Laco Associates for Interim City Manager Services, at a Weekly Rate of $3,600, and Authorize the Mayor to Execute Same.
Presenting Staff Member: Jim Lance, City Attorney
b. Little Lake Fire District Monthly Update.
c. Third District County Supervisor John Haschak Monthly Update.
4. ENACTMENT OF ORDINANCES
a. None.
5. CONSENT CALENDAR
The City Council considers matters listed under the Consent Calendar as routine. The Council will take action with a single motion and roll call vote. A Councilmember may Willits City Council Agenda – April 23,2025
request the removal of an item(s) from the Consent Calendar for separate discussion and subsequent action.
The following items as presented are before the City Council for approval or denial:
a. City Council Minutes:
i. April 9, 2025
6. MONTHLY ACTIVITY REPORTS
Matters that do not require action by the City Council but are of public interest. a. None.
7. COMMISSIONS, AGENCIES AND AUTHORITIES
The Willits City Council meets concurrently as the City of Willits Planning Commission & City of Willits Successor Agency.
8. CITY MANAGER REPORTS AND RECOMMENDATIONS
a. None.
9. DEPARTMENT RECOMMENDATIONS (ACTION ITEMS)
a. Presentation of Audit Conducted by Moss, Levy & Hartzheim Regarding Audited Financial Report for Fiscal Year Ending June 30, 2023.
Presenting staff member: Manuel J. Orozco, Finance Director b. Resolution Approving the Purchase of a Caterpillar 416 Backhoe with Loader.
Presenting staff member: Walter Kolon, Services and Facilities Director c. Resolution Approving the Purchase of a Kubota Tractor and Mower for the Wastewater Treatment Plant.
Presenting staff member: Walter Kolon, Services and Facilities Director d. Discussion and Possible Action on Requesting a Public Convenience and Necessity (PCN) Determination for a Type 20 License for Beer and Wine for the Upcoming Jalos Market Located at 1569 South Main Street.
Presenting Staff Member: Connor Stack, City Planner
e. Discussion and Possible Action on Requesting a Public Convenience and Necessity (PCN) Determination for a Type 20 License for Beer and Wine for the Upcoming Willits Discount Market at 851 South Main Street.
Presenting staff member: Connor Stack, City Planner
10. DEPARTMENT MONTHLY REPORTS – (presented at the second meeting of each month)
a. Airport. b. Community Dev. c. Finance. d. Police Dept. e. Services & Facilities. f. Utilities.
11. CITY COUNCIL ANNOUNCEMENTS, COMMUNICATIONS AND REPORTS
12. GOOD & WELFARE
13. CLOSED SESSION NOTICE
a. None.
14. ADJOURNMENT
Willits City Council Agenda – April 23,2025
Right to Appeal - Persons who are dissatisfied with the decisions of the City Council may have the right to a review of that decision by a court. The City has adopted Section 1094.6 of the Code of Civil Procedure, which generally limits to 90-days, the time within an individual and/or entity may judicially challenge the decisions of the City Boards and Agencies.
I hereby certify under penalty of perjury under the laws of the State of California that I posted the foregoing Agenda on the bulletin board at the main entrance of the City of Willits City Hall, located at 111 East Commercial Street, Willits, California, not less than 72 hours prior to the meeting set forth on this Agenda.
Dated this 17th day of April, 2025.
Delores Pedersen, City Clerk
Americans with Disabilities Act (ADA) Compliance
If you need assistance to attend or participate in a City Council meeting, please contact the City Clerk’s office at (707) 459-7113 or Fax (707) 459-1562. Notification at least 48- hours prior to the meeting will assist the City Clerk in assuring the implementation of reasonable accommodations to provide accessibility to the meeting. Our meeting room is wheelchair accessible and ADA parking is available.
Additional Meeting Information for Interested Parties
Materials related to an item on this Agenda submitted to the Willits City Council, Planning Commission, or Community Development Agency after distribution of the agenda packet are available for public inspection at City Clerk’s office at 111 E. Commercial Street, Willits, during normal business hours, Monday through Thursday 9 AM to 5:30 PM.
Item No. 3a
Meeting Date: April 23, 2025
AGENDA SUMMARY REPORT
To: Honorable Mayor and Council Members
From: Jim Lance, City Attorney
Agenda Title: DISCUSSION AND POSSIBLE APPROVAL OF AN AT-WILL EMPLOYMENT
AGREEMENT WITH LACO ASSOCIATES FOR INTERIM CITY MANAGER SERVICES, AT A WEEKLY RATE OF $3,600, AND AUTHORIZE THE MAYOR TO EXECUTE SAME.
Type: Presentation Consent Regular Agenda Public Hearing Urgent Summary of Request: On March 21, 2025, former City Manager Brian Bender and the Willits City Council agreed to the terms of a separation agreement creating a vacancy in the position of City Manager.
After considering the options and given the City’s challenges and needs at present and going forward it is recommended that the City enter into an agreement for City Manager Services with LACO Associates for a period of six months with a weekly fee of $3,600.
LACO Associates will assign Rod Wilburn to work approximately 24 hours per week unless the needs of the job require him to work more or fewer hours as it states in the Agreement.
Recommended Action: Approve At-Will Employment Agreement with LACO Associates for Interim City Manager Services, at a weekly rate of $3,600, effective April 14, 2025, and continue through October 14, 2025, unless terminated earlier in accordance with the terms of the agreement.
Alternative(s): None recommended.
Fiscal Impact: Initial cost as outlined in the recommended action is $93,600.00 Personnel Impact: Provide essential Leadership to City personnel.
Identified City Council Conflict of Interest: None.
2021 Adopted Goals: The Goals do not cover this topic.
California Environmental Quality Act: Not applicable.
This Item Relates to the following General Plan Element : N/A Land Use Circulation Conservation and Open Space Noise Housing Public Services and Facilities, Parks and Recreation Economic Development
Reviewed by: City Manager City Attorney Assistant City Manager City Clerk Finance Director Human Resources
Council Action: Approved Denied Other: ________________________________________ Records: Agreement Resolution #_________ Ordinance #_________ Other _________ Resolution No. 2025-__ Page 1 of 1 April 23, 2025
RESOLUTION NO. 2025-__
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WILLITS APPOINTNG RODNEY
WILBURN AS INTERIM CITY MANAGER AND AUTHORIZE THE CITY TO ENTER INTO AN AGREEMENT WITH LACO ASSOCIATES FOR INTERIM CITY MANAGER SERVICES.
WHEREAS, On March 28, 2025 during a closed session City Council Meeting the City Council unanimously agreed to the terms of a Separation Agreement with City Manager Brian Bender effective March 28, 2025, creating a vacancy in the office of City Manager; and WHEREAS, the CITY requires the services of a manager with proven executive and administrative qualifications to fill the position of City Manager on an interim basis until a permanent appointment can be made; and
WHEREAS, the City Council finds that LACO Associates (“LACO”) has the requisite skills, personnel and experience to provide the services of Interim City Manager; and WHEREAS, the CITY, acting by and through its City Council, desires to engage LACO to provide the services of Interim City Manager on an at-will basis for a period not to exceed six (6) months and to appropriately compensate LACO for such services in compliance with relevant law; and
WHEREAS, LACO agrees to provide such services on the terms set forth in the Interim City Manager Services Agreement (“Interim Agreement”) and will assign and dedicate the responsibility of performing the Interim City Manager services exclusively to its board chair and principal employee, Rodney Wilburn (“WILBURN”), and the CITY agrees to appoint WIBURN who will be named as its Interim City Manager during the term of this agreement.
NOW, THEREFORE BE IT RESOLVED, that in consideration of the terms and conditions set forth in the interim Agreement, and the mutual promises, covenants and stipulations contained therein, the City is authorized to enter into the attached Interim Agreement for Interim City Manager Services and the Mayor is authorized to execute same on behalf of the City.
BE IT FUTHER RESOLVED that the City is authorized to enter into the attached agreement for City Manager services and authorizes the Mayor to execute same on behalf of the City.
The above and foregoing Resolution was introduced by Councilmember ____, seconded by Councilmember ____, and passed and adopted at a regular meeting of the City Council of the City of Willits, held on the 23rd day of April, 2023, by the following vote:
AYES:
NOES:
ABSENT:
ATTEST:
__________________________
__________________________
Mayor
City Council of the City of Willits
DELORES PEDERSEN
City Clerk
1 AT-WILL EMPLOYMENT AGREEMENT FOR
INTERIM CITY MANAGER SERVICES
This Agreement is made and entered into at Willits, California this ____ day of April, 2025, by and between the City of Willits, a California general law city (“CITY”), and LACO ASSOCIATES, a corporation organized under the laws of the state of California (“LACO”) for the performance by LACO of at-will interim city manager services. This Agreement (the “Agreement”) shall have an effective date of April 14, 2025 (“Effective Date”).
RECITALS
WHEREAS, the CITY requires the services of a manager with proven executive and administrative qualifications to fill the position of City Manager on an interim basis until a permanent appointment can be made; and
WHEREAS, the City Council finds that LACO has the requisite skills, personnel and experience to provide the services of Interim City Manager; and WHEREAS, the CITY, acting by and through its City Council, desires to engage LACO to provide the services of Interim City Manager on an at-will basis for a period not to exceed six (6) months and to appropriately compensate LACO for such services in compliance with relevant law; and
WHEREAS, LACO agrees to provide such services on the terms set forth herein and will assign and dedicate the responsibility of performing the Interim City Manager services exclusively to its board chair and principal employee, Rodney Wilburn (“WILBURN”), and the CITY agrees to appoint WIBURN who will be named as its Interim City Manager during the term of this agreement.
NOW, THEREFORE, in consideration of this Agreement, and the mutual promises, covenants and stipulations contained herein, the parties hereto agree as follows:
TERMS
1. Appointment. The CITY and LACO hereby agree that LACO shall provide interim city manager services subject to and during the term of this Agreement, and LACO will assign the responsibility of performing such services exclusively to WILBURN. City hereby appoints WILBURN to the position of Interim City Manager for the City of Willits, and confers upon and delegates to WILBURN all of the duties, powers, and responsibilities of City Manager as the same are set forth in the City of Willits Municipal Code, and the ordinances, resolutions, policies, rules and regulations as from time to time are existing thereunder (“the Services”). WILBURN accepts the position as Interim City Manager and agrees to serve, as such.
2 2. Compensation.
A.
The CITY will pay LACO a flat rate of three thousand, six hundred dollars ($3,600.00) per week (“the Weekly Rate”) for each week during the term of this Agreement as compensation for WILBURN’S performing interim city manager services. Such payment shall be in effect for the term of this Agreement unless modified by mutual agreement of the parties set forth in writing. LACO will invoice CITY monthly and CITY will promptly pay the invoices upon receipt. CITY will have no obligation to compensate WILBURN directly nor will city pay any taxes and other legally required deductions on behalf of WILBURN.
B. This Agreement shall commence April 14, 2025 and continue through October 14, 2025 unless terminated earlier in accordance with the terms of this agreement.
LACO will assign WILBURN to work approximately 24 hours per week unless the needs of the job require him to work more or fewer hours each week. The parties intend that WILBURN will generally not work on Fridays.
C. Because positive and confidential relations are necessary between the City Manager and the City Council, LACO understands and agrees that WILBURN serves at the pleasure of the City Council and may be terminated at the will of the City Council, subject only to the notice and termination provisions set forth herein. In a like manner, nothing in this Agreement shall prevent, limit, or otherwise interfere with WILBURN’S right to resign at any time from the position of Interim City Manager, subject only to the notice provisions set forth herein.
D. In the event WILBURN voluntarily resigns his position as Interim City Manager, LACO shall give the CITY thirty (30) days written notice in advance, unless the parties agree otherwise.
3. Employment Working Conditions.
A. WILBURN shall provide the CITY with a report of hours worked by way of a weekly timesheet.
B. The parties agree that the position of City Manager is an exempt position under the terms of the federal Fair Labor Standards Act, and that therefore no overtime will be paid under this Agreement.
C. LACO understands and agrees that it is not an employee of CITY and that LACO employees who may perform services for the City pursuant to this Agreement including WILBURN are not CITY employees, and are therefore not entitled to any of the rights, benefits and privileges of CITY employees including, but not limited to medical or workers’ compensation insurance. The parties intend to and have entered into a bona fide independent contractor agreement, and nothing herein is a subterfuge to avoid making LACO or its employees including WILBURN, employees of CITY.
3 D. WILBURN shall not engage in any activity, with LACO or otherwise, which is or may become a conflict of interest, prohibited contract, or which may create an incompatibility of office as the CITY’S Interim City Manager. LACO will cause WILBURN shall complete all disclosure forms required by law. Further, during the term of this agreement and for a period of at least six (6) months following the term.
Both LACO and WILBURN will not directly or indirectly, bid on, participate in, or solicit any business from the CITY, its agencies or representatives, in connection with any contract awarded or to be awarded by the CITY. This includes but is not limited to: (a) bidding on or participating in public works projects including contracts to provide the CITY with engineering, surveying, project management or other professional services; (b) consulting with any entity bidding on or participating in CITY projects; and (c) working for any entity that is a bidder or contractor with the CITY.
4. Termination.
A. The City Council may terminate WILBURN’S services as Interim City Manager at any time, with or without cause, and with or without notice. In the event WILBURN is terminated from his position as Interim City Manager, the CITY shall pay LACO at the Weekly Rate for weeks of service, or portions thereof, for time already expended as Interim City Manager. The CITY shall have no other obligations to LACO or WILBURN.
B. The Parties agree that WILBURN’S appointment as Interim City Manager pursuant to this Agreement is “at-will” and that the appointment may be terminated by either party without cause. This Agreement contains no express or implied promise to LACO or WILBURN concerning any form of continued employment as Interim City Manager, or as permanent City Manager. LACO agrees that the CITY has made no representation, promise or statement that may be construed to mean that WILBURN has been appointed on any basis other than an at-will basis in accordance with this Agreement. WILBURN’S temporary, at-will appointment status may only be changed or superseded by a subsequent written agreement signed by authorized representatives of both Parties.
5. Defense and Indemnification. The CITY shall defend and indemnify WILBURN against any claim or action against him for injury arising out of an act or omission occurring within the scope of his appointment as Interim City Manager pursuant to the provisions of the California Tort Claims Act (Govt. Code Sec, 810 et seq.), as amended from time to time, except to the extent caused by any willful, intentional or reckless conduct. WILBURN’S conviction for any felony or a misdemeanor involving moral turpitude also shall be a basis for City’s exemption of this indemnification.
6. Notices: Any notice required or authorized to be given under the terms of this Agreement must be duly and properly given to the CITY or WILBURN in writing and personally delivered, or if mailed first class United States mail, postage thereon fully prepaid, addressed as follows:
4 CITY: Mayor and City Council
City of Willits
111 E. Commercial Street
Willits, CA 95490
LACO: LACO Associates
1072 N State St.
Ukiah, CA 95482
Or such other address as either party may from time to time designate in writing to the other party.
7. Entire Agreement. This Agreement embodies the whole agreement between the parties hereto, and there are no inducements, promises, terms, conditions or obligations made or entered into by the CITY or LACO than those contained herein.
8. Miscellaneous.
A. If any provision, or any portion thereof, contained in this Agreement is held unconstitutional, invalid or unenforceable, the remainder of this Agreement, or portion thereof, shall be deemed severable, shall not be affected and shall remain in full force and effect.
B. This Agreement shall be governed by the laws of the State of California.
C. The parties agree that any ambiguity in this Agreement shall not be construed or interpreted against, or in favor of, either party.
D. In the event of litigation over the terms of this Agreement the prevailing party shall be entitled to attorney’s fees and costs.
E. This Agreement may be executed in counterparts containing original signatures.
IN WITNESS WHEREOF, the Parties have caused their authorized representatives to execute this Agreement on the day first above-written.
LACO Associates: CITY:
_________________________ _________________________
By Rodney Wilburn, its Board Mayor
Chairman and authorized representative
ATTEST: APPROVED AS TO FORM:
_________________________ _________________________
Delores Pedersen, City Clerk H. James Lance, City Attorney 111 E. COMMERCIAL STREET
WILLITS, CALIFORNIA 95490
(707) 459-4601 TEL
(707) 459-1562 FAX
WILLITS CITY COUNCIL
MINUTES
WEDNESDAY APRIL 9, 2025
Mayor Stranske called a regular meeting of the City Council to order at 6:30 p.m., in Council Chambers. The meeting was preceded by the pledge to the flag.
Roll Call: Councilmembers Gerardo Gonzalez, Tom Allman, Bruce Burton, Vice Mayor Matthew Alaniz and Mayor Larry Stranske were present.
Also present were staff members: Cathy Moorhead, Assistant City Manager; Jim Lance, City Attorney; Dusty Duley, Community Development Director; Walter Kolon, Services and Facilities Director; Manuel Orozco, Finance Director; Mike Parish, Interim Police Chief; and Delores Pedersen, City Clerk.
2. Public Communications
a. Melinda Clark expressed her concern that none of the Willits Council Members attended the Mendocino College Town Hall Meeting with Congressman Huffman and Assemblyman Rogers. Congressman Huffman has expressed interest in hosting a Town Hall in Willits and Ms. Clark is hoping the Council will attend. b. Dan Louden reported that he received $71.20 reimbursement on his bank statement from the City of Willits and does not know what it is from. c. Peggy Webber asked about a canceled meeting.
3. Public Matters
None.
4. Enactment of Ordinances
None presented.
5. Consent Calendar
The following item(s) are recommended for approval or denial, as follows:
a. City Council Minutes:
i. February 26, 2025.
ii. March 13, 2025.
iii. March 21, 2025.
iv.March 28, 2025.
Willits City Council Minutes of April 9, 2025 Page 2 of 5 Public Comment: None presented.
Moved by Allman/Seconded by Gonzalez and carried unanimously to approve Consent Calendar item(s) (a).
6. Monthly Activity Reports
Matters that do not require action by the City Council but are of public interest. a. Accounts Payable Activity Report: March 2025.
b. Building Permit Activity Report: March 2025.
c. Business License Activity Report: March 2025.
7. Commissions, Agencies and Authorities
None presented.
8. City Manager Reports and Recommendations
a. None presented.
Public Comment: None presented.
9. Department Recommendations (Action Items)
a. Appoint Sherri Ebyam to fill the Vacancy on the Measure K Oversight Committee to Ensure the Committee has the Full Complement of Members.
Presenting staff member: Manuel J. Orozco, Finance Director • Councilmember Allman spoke in support of Ms. Ebyam being appointed to the Measure K Committee.
Public Comment:
• Linda Burns inquired how the decision was made to appoint Sherri Ebyam to the Measure K Committee. City Clerk Pedersen responded that Ms. Ebyam was the only application submitted.
Moved by Burton/Seconded by Gonzalez and carried unanimously to adopt Resolution No. 2025-12 to appoint Sherri Ebyam to fill the vacancy on the Measure K Oversight Committee to ensure the committee has the full complement of members.
b. Adoption of Resolution Establishing the Appropriations Limit for the 2024-25 Fiscal Year, Pursuant to Article XIIIB of the Constitution of the State of California.
Presenting staff member: Manuel J. Orozco, Finance Director Public Comment:
• Sherri Ebyam inquired if the reason for the 60% appropriation is because that is what the City could afford and historically is it typical that the City would appropriate about 60% of the limit. Finance Director Orozco responded that it is based on how much the City can afford.
Moved by Gonzalez/Seconded by Alaniz and carried unanimously to adopt Resolution No. 2025-13 adopting the Appropriations Limit for Fiscal Year 2024- 25 Pursuant to Article XIII B of the Constitution of the State of California.
Willits City Council Minutes of April 9, 2025 Page 3 of 5 c. The First Amendment to the Five-Year Agreement (Approved September 25, 2024) Between the Willits Chamber of Commerce and the City of Willits for a Quarterly Allocation of the Transient Occupancy Tax.
Presenting staff member: Manuel J. Orozco, Finance Director.
Public Comment: None.
Moved by Burton/Seconded by Gonzalez and carried unanimously to adopt Resolution No. 2025-14 approving the First Amendment to the Five-Year Agreement (Approved September 25, 2024) between the Willits Chamber of Commerce and the City of Willits for a Quarterly Allocation of the Transient Occupancy Tax.
d. Discussion and Possible Action to Approve an Agreement Authorizing the Willits Farmers Market to Operate in Bud Snider Park.
Presenting staff member: Connor Stack, City Planner
• Councilmember Burton inquired if there is a fee for vendors to participate in the Farmers Market. Mr. Foley responded that there was a stall fee of approximately 10% of their sales on the Farmers Market days.
Councilmember Burton also inquired how many non-food vendors are at the Farmers Market. Mr. Foley reports that they limit the non-food vendors to 25% of the vendors selling.
Public Comment:
• Kathy Bouthillier inquired as to what provisions are being made for parking.
Mr. Foley responded that state street would be closed to all traffic except vendors and residents and that the vendors are only allowed to park on the park side of State St.
• Madge Strong inquired about the restrictions and rules that the vendors have regarding the products and food that they sell. Mr. Foley responded that any product that the non-food vendor brings to sell at least 75% of it must be produced by them or sourced locally. For food vendors 100% must come from the vendors’ farm.
• Bear Kamoroff welcomes back the Farmers Market but is concerned about the potential parking problems.
• Linda Burns expressed concern over the speeding vehicles that often occurs during farmers market days. Ms. Burns is concerned about the children and parents that come and go from the Imagination Station on Farmers Market Days. Councilmember Gonzalez suggested that Ms. Burns reports any vehicle that is unsafe to Michael Foley of the Farmers Market. Vice Mayor Alaniz requested that the Interim Police Chief Mike Parish attempt to have a police presence the first couple weeks of the Farmers Market. Police Chief Parish mentioned that he could not promise a presence for more than the first day of May 1st, Police Chief Parish stated to contact the Police Department if there are any issues with illegal parking or speeding.
Willits City Council Minutes of April 9, 2025 Page 4 of 5 Moved by Gonzalez/Seconded by Allman and carried unanimously to adopt Resolution No. 2025-15 approving the Terms of an Agreement between the City and the Mendocino County Farmers’ Market Association to conduct weekly Farmers’ Markets for the 2025 Season at Bud Snider Park
10. City Council Announcements, Communications and Reports Councilmember Gonzalez
League of California Cities/Redwood Empire Division
Cal Cities has requested support to oppose of SB 634 Perez Homeless Civil Criminal Penalties.
Local Agency Formation Commission (LAFCo)
Public Hearing on the Potter Valley Irrigation Municipal Service Review and Sphere of Influence.
Public Hearing on LAFCO Proposed Budgets and Work Program for 2025/2026.
Discussion on raising fees that Cities and Special Districts are charged and pay to LAFCO.
Workshop on the Westport County Water District Draft Municipal Service Review and a Russian River Flood Control District Service Review and Sphere of Influence update.
Councilmember Allman
Finance Committee
Asked to have what was presented at the Finance Committee be on the website.
Vice Mayor Alaniz
Mendocino Transit Authority (MTA)-
Preparations for the FY 25/26 Budget.
Mayor Stranske
Water/Wastewater Committee –
Transportation Committee –
Economic Development & Financing Corporation (EDFC) – Mendocino Solid Waste Management Authority (MSWMA) –
Mendocino Council of Governments
Discussions to change the name of the Joint Powers Agreement to include energy and climate related programs.
Caltrans District One Traffic Study. It was mentioned that Round-a-Bouts are much safer than traffic lights.
Public Comment: None presented.
No action taken.
11. Good & Welfare
Councilmember Gonzalez
Sober Grads Tri Tip Dinner is on Friday April 11th.
Stuart Handte announced that it is City Clerk Pedersen’s Birthday.
Willits City Council Minutes of April 9, 2025 Page 5 of 5 Public Comment:
• Linda Burns expressed concerns over the shouting that she heard during one of the closed sessions Council Meetings.
• Karen Cavanaugh expressed concerns over the Previous City Manager yelling at someone on the dais during a meeting that she had attended and stated that at times that yelling happens both ways.
City Council Adjourned to Closed Session at 8:04 pm.
12. Closed Session Notice
a. Pursuant to Government Code §54957 – Consideration and Possible Appointment of an Interim City Manager.
The City Council reconvened to open session at 8:44 pm, Mayor Stranske reported that the Willits City Council has entered into negotiations with a candidate for Acting City Manager no added information will be presented at this time.
13. Adjournment
Mayor Stranske declared the meeting adjourned at 8:45 p.m.
For more information on the April 9, 2025 Willits City Council Meeting please view the recording on YouTube.
__________________________
___
LARRY STRANSKE, Mayor
City Council for the City of Willits
ATTEST:
__________________________
DELORES PEDERSEN
City Clerk
Item No. 9a
Meeting Date: April 23, 2025
AGENDA SUMMARY REPORT
To: Honorable Mayor and Council Members
From: Manuel J. Orozco, Finance Director
Agenda Title: PRESENTATION OF AUDIT CONDUCTED BY MOSS, LEVY & HARTZHEIM REGARDING AUDITED FINANCIAL REPORT FOR FISCAL YEAR ENDING JUNE 30, 2023.
Type: Presentation Consent Regular Agenda Public Hearing Urgent Time: 15 Mins Summary of Request: The firm Moss, Levy & Hartzheim LLP issued an unmodified opinion on the City of Willits financial statements for the fiscal year ending June 30, 2023.
The Financial Report is presented in three sections: Independent Auditors Report, Management Discussion and Analysis and Financial Statements, including the notes to the Financial Statements. The Independent Auditor’s Report section discusses the standards that were used to formulate the basis of the Auditor’s Opinion. The Management Discussion and Analysis is part of the report where management provides an overview of the City’s financial performance over the previous year and its current financial condition. The Management Discussion & Analysis aims to provide insight into the operations, strategies, and potential risks, helping to contextualize the financial statements presented in the report.
As of the end of June 2023 the ending fund balance in the General Fund Increased by $397,637 or 11% from $3,538,482 to $3,936,119.
The Sales Tax Transportation Improvement Fund ended the year with $2,437,650 in reserves, a decrease of $877,188 or 26% over the prior stated reserves.
The Sewer enterprise fund balance increased $353,469 while the balance in the Water enterprise increased $64,277, as indicated on page 25 of Financial Statements.
Please read the Management Discussion and Analysis (pages 3-15) for an overview of the financial statements. The Notes to the Financial Statements (pages 29-55) are an integral part of understanding the financial statements.
Recommended Action: Accept the Financial Statements for the Fiscal Year Ending June 30, 2023.
Alternative(s): N/A
Fiscal Impact: None.
Personnel Impact: N/A
2021 Adopted Goals: The request conforms with the recommendation listed as Goal #1, Policy #1.4 under Administration…Provide the community with annual report on the use of increasing revenues related to Measure K, cannabis revenues and tourism revenues (annual City reporting).
Reviewed by: City Manager City Attorney Assistant City Manager City Clerk Finance Director Human Resources Risk Manager
Council Action: Approved Denied Other: ________________________________________ Records: Agreement Resolution #_________ Ordinance #_________ Other _________
CITY OF WILLITS
Annual Financial Report
Fiscal Year Ended June 30, 2023
CITY OF WILLITS
ANNUAL FINANCIAL REPORT
Fiscal Year Ended June 30, 2023
TABLE OF CONTENTS
I. FINANCIAL SECTION
A. Independent Auditor’s Report ................................................................................................ 1 B. Management’s Discussion and Analysis ................................................................................ 4 C. Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Position ............................................................................................. 17 Statement of Activities ................................................................................................. 18 Fund Financial Statements:
Governmental Funds:
Balance Sheet ......................................................................................................... 20 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position ......................................................................... 21 Statement of Revenues, Expenditures, and Changes in Fund Balances ................ 22 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities ......................................................................................................... 23 Proprietary Funds:
Statement of Net Position ...................................................................................... 24 Statement of Revenues, Expenses, and Changes in Net Position .......................... 25 Statement of Cash Flows ...................................................................................... 26 Fiduciary Funds:
Statement of Fiduciary Net Position ...................................................................... 27 Statement of Changes in Fiduciary Net Position ................................................... 28 Notes to Basic Financial Statements ................................................................................. 29 D. Required Supplementary Information:
General Fund – Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual ........................................................................ 57 Sales Tax Special Revenue Fund – Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual .............................................. 58 Gas Tax Special Revenue Fund – Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual .............................................. 59 Schedule of the City’s Proportionate Share of the Net Pension Liability ......................... 60 Schedule of Pension Contributions ................................................................................... 61
CITY OF WILLITS
ANNUAL FINANCIAL REPORT
Fiscal Year Ended June 30, 2023
TABLE OF CONTENTS
II. FINANCIAL SECTION (Continued)
E. Other Supplemental Information
Capital Outlay Capital Projects Fund– Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual ..................................................... 62 Nonmajor Governmental Funds
Description of Nonmajor Governmental Funds ........................................................... 63 Combining Balance Sheet ............................................................................................ 64 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances ....................................................................................................... 66 Schedules of Revenues, Expenditures, and Changes in Fund Balances- Budget and Actual:
LEAA Program Special Revenue Fund ................................................................. 69 Narcotic Forfeiture Special Revenue Fund ............................................................ 70 H&S Restitution Special Revenue Fund ................................................................ 71 Traffic Safety Special Revenue Fund .................................................................... 72 Nonmajor Proprietary Funds
Description of Nonmajor Proprietary Funds ................................................................ 73 Combining Statement of Net Position .......................................................................... 74 Combining Statement of Revenues, Expenses, and Changes in Net Position .............. 75 Combining Statement of Cash Flows ........................................................................... 76
FINANCIAL SECTION
OFFICES: BEVERLY HILLS ∙ CULVER CITY ∙ SANTA MARIA
MEMBER AMERICAN INSTITUTE OF C.P.A.’S ∙ CALIFORNIA SOCIETY OF MUNICIPAL FINANCE OFFICERS ∙ CALIFORNIA ASSOCIATION OF SCHOOL
BUSINESS OFFICIALS
1 PARTNERS COMMERCIAL ACCOUNTING & TAX SERVICES GOVERNMENTAL AUDIT SERVICES CRAIG A HARTZHEIM, CPA 8383 WILSHIRE BLVD., SUITE 800 5800 E. HANNUM, SUITE E HADLEY Y HUI, CPA BEVERLY HILLS, CA 90210 CULVER CITY, CA 90230 ALEXANDER C HOM, CPA TEL: 310.670.2745 TEL: 310.670.2745 ADAM V GUISE, CPA FAX: 310.670.1689 FAX: 310.670.1689
TRAVIS J HOLE, CPA www.mlhcpas.com www.mlhcpas.com
WILSON LAM, CPA
INDEPENDENT AUDITOR’S REPORT
The Members of the City Council of the
City of Willits
Willits, California
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of City of Willits, California as of and for the fiscal year ended June 30, 2023, and the related notes to the financial statements, which collectively comprise the City's basic financial statements as listed in the table of contents.
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Willits, California, as of June 30, 2023, and the respective changes in financial position and, where applicable, cash flows thereof, for the fiscal year then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and those standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City, and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
Auditor's Responsibility for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions.
Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists.
2 The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis on pages 3 through 16, Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget to Actual – General Fund, and the Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget to Actual – Refuse Special Revenue Fund, Schedule of Changes in the Net Pension Liability and Related Ratios, and Schedule of Pension Contributions on pages 57 through 61 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Willits’s basic financial statements. The Budgetary Comparison Schedules for the Capital Outlay Capital Projects Fund and Nonmajor Governmental Funds; the Combining Financial Statements for the Nonmajor Governmental Funds, and the Nonmajor Enterprise Funds listed in the table of contents are presented for purposes of additional analysis and are not required parts of the basic financial statements.
The Budgetary Comparison Schedules for the Public Facilities Capital Projects Fund and Nonmajor Governmental Funds; the Combining Financial Statements for the Nonmajor Governmental Funds, and the Nonmajor Enterprise Funds are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in our audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally 3 accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated February 24, 2025, 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 to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.
Moss, Levy & Hartzheim, LLP
Culver City, California
February 24, 2025
CITY OF WILLITS
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
4 This discussion and analysis provide an overview of the City of Willits’ financial performance for the fiscal year ended June 30, 2023. This report has been prepared in accordance with Accounting Principles Generally Accepted in the United States of America (GAAP) as established by the Governmental Accounting Standard Board (GASB). We encourage our readers to consider this information in conjunction with the information provided in the accompanying basic financial statements and notes.
FINANCIAL HIGHLIGHTS
Financial highlights of the fiscal year ending June 30, 2023, include the following:
Government-wide:
The City’s total net position was $34,677,810 as of June 30, 2023. This was an increase of $2,167,021 or 7% from the prior fiscal year. Of this total, $7,574,751 was governmental net position and $27,103,059 was business-type net position.
Government-wide primary government revenues were $8,733,519 and were $1,347,364 or 13% more than the prior fiscal year. They include program revenues of $3,295,944 and general revenues and transfers of $5,437,575.
Government-wide primary government expenses were $6,495,422 and were $2,034,623 or 24% more than the prior fiscal year.
Business-type revenues were $7,063,856 including transfers and were $371,390 or 6% less than the prior fiscal year. They include program revenues of $6,996,348and general revenues and transfers of $67,508.
Business-type expenses were $6,956,012 and were $37,455 or 3% less than the prior fiscal year.
Fund Level:
Governmental fund balances increased $1,254,968 in fiscal year 2023. Governmental fund revenues increased $1,373,217 or 14% in fiscal year 2023. Governmental fund expenditures increased $2,392,407 or 31% in fiscal year 2023. General Fund revenues of $6,831,067 represented a $41,253 increase over the prior fiscal year. General Fund expenditures of $6,475,152 represented an increase of $45,924 over the prior fiscal year.
General Fund balance of $3,936,119 as of June 30, 2023, increased by $397,637 or 11% from prior fiscal year’s fund balance of $3,538,482.
OVERVIEW OF THE COMPREHENSIVE ANNUAL FINANCIAL REPORT
The financial section of this report consists of five parts. Independent Auditor's Report
Management Discussion and Analysis (Unaudited)
Basic Financial Statements, which include: Government-Wide Financial Statements, Fund Financial Statements and Notes to Basic Financial Statements Required Supplementary Information (Unaudited)
Supplementary Information, which includes Combining Fund Statements The Statement of Net Position and Statement of Revenues, Expenses, and Changes in Net Position provide information about the activities of the City, presenting an aggregate view of the City’s finances. The basic financial statements also include notes explaining pertinent information in the financial statements and provide more detailed data.
The Basic Financial Statements for the District are presented as "Government-Wide" and Proprietary or Enterprise Fund financial statements. The chart below provides an overview of the major features of the financial statements.
CITY OF WILLITS
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
5 Figure A
Major Features of City of Willits' Government-wide and Fund Financial Statements Government-wide Statements
Fund Statements
Governmental Funds Proprietary Funds
Scope Entire City government City Activities that are not proprietary or fiduciary, such
as police, fire, and parks
Activities the City operates
similar to private businesses:
such as water and
wastewater systems.
Required financial
statements
Statement of net position Balance sheet Statement of net position Statement of activities Statement of revenues,
expenditures, and changes in
fund balances
Statement of revenues
expenses, and changes in net
position
Statement of cash flows
Accounting basis
and measurement
focus
Accrual accounting and
economic resources
measurement focus
Modified accrual accounting
and current financial
resources measurement
focus
Accrual accounting and
economic resources
measurement focus
Type of
asset/liability
information
All assets and liabilities, both
financial and capital, and shortterm and long-term
Only assets expected to be
used up and liabilities that
come due during the fiscal
year or soon thereafter; no
capital assets or long-term
liabilities included
All assets and liabilities, both
financial and capital, and
short-term and long-term
Type of
inflow/outflow
information
All revenues and expenses
during year, regardless of when
cash is received or paid
Revenues for which cash is
received during or soon after
the end of the year;
expenditures when goods or
services have been received
and payment is due during
the fiscal year or soon
thereafter
All revenues and expenses
during year, regardless of
when cash is received or paid
Government-wide Financial Statements
The Government-wide financial statements provide a longer-term view of the City’s activities as a whole and comprise the Statement of Net Position and the Statement of Activities. The Statement of Net Position provides information about the financial position of the City as a whole, including all of its capital assets and long-term liabilities on the full accrual basis, similar to that used by corporations.
The Statement of Activities provides information about all the City’s revenues and all of its expenses, also on the full accrual basis, with the emphasis on measuring net revenues or expenses of each of the City’s programs. The Statement of Activities explains in detail the change in net positions for the fiscal year.
All of the City’s activities are grouped into governmental activities and business-type activities, as
CITY OF WILLITS
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
6 explained below. The amounts in the Statement of Net Position and the Statement of Activities are separated into governmental activities and business-type activities in order to provide a summary of these two activities for the City as a whole.
Government-wide financial statements are prepared on the accrual basis, which mean they measure the flow of all economic resources of the City as a whole.
The Statement of Net Position and the Statement of Activities present information about the following:
Governmental Activities – All of the City’s basic services are considered to be governmental activities. These services are supported by the general City revenues such as taxes, and by specific program revenues such as user fees and charges.
Business-type Activities – The City’s enterprise activities consist of water, wastewater, solid waste and airport are reported in this area. Unlike governmental services, these services are supported by charges paid by users based on the amount of service they use.
Fund Financial Statements
The fund financial statements report on the City’s operations in more detail than the Government-wide statements and focus primarily on the short-term activities of the City’s General Fund and other governmental funds. The fund financial statements measure only current revenues and expenditures and fund balances; they exclude capital assets, long-term debt, and other long-term amounts.
The fund financial statements provide detailed information about each of the City’s most significant funds, called major funds. Major funds account for the major financial activities of the City and are presented individually, while the activities of non-major funds are presented in summary, with subordinate schedules presenting the detail for each of these other funds. The concept of major funds, and the determination of which funds are major, was established by the Governmental Accounting Standards Board (GASB) Statement No. 34 and replaces the concept of combining like funds and presenting them in total. Instead, each major fund is presented individually, with all non-major funds summarized and presented only in a single column. Subordinate schedules present detail of these non-major funds. Major funds present the major activities of the City for the fiscal year and may change from year to year as a result of changes in the pattern of the City’s activities.
The fund statements report on four major governmental funds: the General Fund, Sales Tax Special Revenue Fund, Capital Projects and Gas Tax Special Revenue Fund.
The major business-type or enterprise funds are Water and Wastewater (Sewer) and two non-major enterprise funds.
Fund financial statements include governmental and proprietary funds as discussed below.
Governmental fund financial statements are prepared on the modified accrual basis, which means they measure only current financial resources and uses. Capital assets and other long-lived assets, along with long-term liabilities, are not presented in the governmental fund financial statements.
Proprietary fund financial statements are prepared on the full accrual basis and include all assets and liabilities, current and long-term.
FINANCIAL ACTIVITIES OF THE CITY AS A WHOLE
This analysis focuses on the net positions of the City as a whole. Table 1 below is a summary of the Statement of Net Position for the City as a whole combining the governmental and business-type activities.
CITY OF WILLITS
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
7 GOVERNMENTAL ACTIVITIES
Tables 2 and 3 below focus on the City’s Governmental Statement of Net Position and Statements of Activities.
CITY OF WILLITS
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
8 The City’s governmental net position amounted to $ 7,574,751 as of June 30, 2023, an increase of $2,059,177 or 37% over 2022. The City’s net position as of June 30, 2023, comprised the following:
Cash and investments comprised $6,594,574. Substantially all of these amounts were held in short term investments in government securities, as detailed in Note 3 to the financial statements. Other assets comprised $1572,168, in accounts receivable $225,481 of notes receivable, $967,009 due from other funds, and $208,430 of inventory totaling $2,9,973,088. Capital assets of $5,397,416, net of accumulated depreciation, which included all the City’s capital assets used in governmental activities.
Current liabilities, including accounts payable, claims and other amounts due currently, total $1,035,030.
Long-term liabilities of $8,936,134. The liability is primarily related to the City’s Net Pension Liabilities. Additional detail is shown in Table 8.
Net investment in capital assets of $5,397,416, representing the City’s investment in capital assets used in governmental activities, net of accumulated depreciation and amounts borrowed to finance those capital assets.
Unrestricted net position, the part of net positions that can be used to finance day to day operations without constraints net of debt covenants or other legal requirements or restrictions, was ($385,741) as of June 30, 2023 fiscal year an increase of $3,048,535 from prior fiscal year 2022.
The Statement of Activities presents program revenues, expenses, and general revenues. Program revenues are charges for services and grants/contributions that are generally restricted to funding all or a portion of expenses for specific services. Table 3 below summarizes the governmental revenues by program, general and transfers, and expenses.
CITY OF WILLITS
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
9 As Table 3 shows, $3,295,944, 38% of the City’s fiscal year 2023 governmental revenue, came from program revenues and $5,437,575, or 62%, came from general revenues such as taxes and interest and transfers. Program revenues were composed of charges for services of $663,458, which included permit revenues, fees and charges used to fund expenses incurred in providing services; $916,571 of operating grants and contributions, which included gas tax revenues and housing and police grants; and $1,715,915 of capital grants and contributions, which relates to grants allocated for capital improvements. General revenues are not allocable to programs.
General revenues are used to pay for the net cost of governmental programs.
Governmental Revenues
Governmental revenues are primarily from taxes, $4,559,446, or 52%, with the remaining balance coming from capital grants and contributions, $1,715,915, or 20%, operating grants and contributions, $916,571, or 11%, charges for services, $663,458, or 8%, and $767,593, or 9% coming from other revenue, use of money and property, $84,683, or 1%. The chart below shows the relationship of the revenues.
Governmental Expenses
Governmental expenses include only current fiscal year expenses; they do not include capital outlays, which are added to the City’s capital assets. As the chart below shows, public safety, public works, and general government make up 85% of the total governmental expenses.
CITY OF WILLITS
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
10 BUSINESS-TYPE ACTIVITIES
The Statement of Net Position and Statement of Activities present a summary of the City’s Business-type activities that are composed of the City’s enterprise funds. In Table 4 below, the net position of business-type activities increased by $107,844 in fiscal year 20223.
From the Statement of Activities, Table 5 summarizes the changes in net position for all the enterprise funds. Program revenues are $6,996,349 for the fiscal year 2023, which is $311,382 more than the prior fiscal year. The program revenues make up 99% of the total revenues available to fund the enterprises.
The expenses for fiscal year 2023 were $6,956,012 which was $37,455, or 1%, less than the prior fiscal year.
CITY OF WILLITS
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
11 The Sewer Fund operating revenues increased by $440,354, or 13% in fiscal year 2023 and operating expenses decreased by $397,248, or 12% resulting in net operating income of $898,393 for fiscal year 2023. Most of the increase in expenses is related to operations, materials and supplies and depreciation. The fund’s net position decreased by $353,469 to a new total of $11,959,848. Of this amount, $7,394,345 was net investment in capital assets and $4,565,503 was unrestricted.
The Water Fund revenues decreased by $164,686 in the fiscal year 2023. Expenses decreased by $52,862 in fiscal year 2023. The fund's net position increased by $64,277 in the fiscal year 2023. As of June 30, 20223 the fund’s net position was $15,709,679, of which 12,319,015 was net investment in capital assets, and $3,390,664 was unrestricted.
CITY OF WILLITS
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
12 ANALYSIS OF GOVERNMENTAL FUNDS
From the Fund Statement of Revenues, Expenditures, and Changes in Fund Balance, Table 6 below, summarizes the activity for the General Fund and other governmental funds. The revenues and expenditures are on a modified accrual basis and include capital outlay expenditures.
CITY OF WILLITS
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
13 The General Fund revenues of $6,831,067 increased by $41,253 from the prior fiscal year. The change is mostly due to increased revenue from Sales Tax.
General Fund expenditures were $6,6,475,152, an increase of $451,923 or 8%, from the prior year.
The expenditure was mainly due to an increase in legal expenses, retirement, and other contractor costs.
As of June 30,2022, , the General Fund’s fund balance totaled $3,936,119. The unassigned portion of Fund Balance was $3,432,395 which was an increase of $379,469, or 12%, from the prior year and is due to an increase in sales and other tax revenues.
The Other governmental funds include the Sales Tax and Gas tax funds which are used to account for capital expenditures, maintenance, rehabilitation, reconstruction and construction of City streets and roads.
CAPITAL ASSETS
GASB Statement No. 34 required the City to record all its capital assets including infrastructure, which was not recorded prior to GASB Statement No. 34. Infrastructure includes roads, bridges, signals, and similar assets used by the entire population.
In fiscal year 2023, the City reported the cost of all its infrastructure assets and computed the amounts of accumulated depreciation for these assets based on their original acquisition dates. At the end of fiscal year 2023, the cost of infrastructure and other capital assets recorded on the City’s financial statements is as shown in Table 7 below.
Details on capital assets, current fiscal year additions and construction in progress can be found in the Notes under Note 5.
The City depreciates all its capital assets over their estimated useful lives, as required by GASB Statement No. 34. The purpose of depreciation is to spread the cost of a capital asset over the years of its useful life so that an allocable portion of the cost of the asset is borne by all users. Additional information on depreciable lives may be found in the Notes to the financial statements.
CITY OF WILLITS
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
14 LONG TERM DEBT AND LIABILITIES
The City issues debt financing for capital improvements primarily for water and wastewater enterprises. The long-term liabilities are employee compensated absences, Net Pension from CalPERS and Landfill Post-Closure costs. The City’s debt issues and Landfill costs are discussed in detail in Note 7 of the financial statements. The Pension liabilities are discussed in Note 12.
The City's long-term debt and liability balances as of June 30 were as follows:
Total long-term debt for the City increased by $4,447,666 composed of a $4,484,434 increase in net pension liability, an increase of $36,768 decrease in compensated absences, and decreases in outstanding debt of $485,646 from principal repayment. The City made all scheduled repayments of the current debt.
ECONOMIC CONDITION, OUTLOOK, AND ACTIVITY
The passing of Measure K helped stabilize the City’s finances. The overall Financial Position of the City increased by $2,167,021 in 2023.
The City was able to work on several projects in the city which were delayed and led to significant deterioration of its infrastructure. Staff completed the following projects in 2023; (1) The City Hall Community Center Project; (2) The Fuel Island and Administration Building Renovations at the Airport; (3) Commitment to an Annual Flushing Program of the Distribution System; and (4) The First Phase of the IT Upgrade Program. Staff expects to complete the following projects in 2024: The Rail Trail Project Design; (2) Blosser Rehabilitation Project (Phase One); (3) East Commercial Street Corridor Master Plan; (4) The W. Mendocino Project expected to be completed in 2024. Staff is preparing for a Utility Rate Study to ensure the continued viability of the Utility Programs over the next five years. In addition, the city streets and roadways have been maintained, paved and rid of potholes. The City was able to restore most of its services and is optimistic of expanding its programs to benefit the city residents.
The City council and management have pulled together and decided to do a General Plan Update
CITY OF WILLITS
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
15 which will include land use planning, financing, code enforcement, and street rehabilitation. The community will benefit from this dedication as the organization achieves the goals expressed in our Mission Statement.
CONTACTING THE CITY’S FINANCIAL MANAGEMENT
This Basic Financials are a report intended to provide citizens, taxpayers, and creditors with a general overview of the City’s finances. Questions about this report should be directed to the City of Willits, at 111 E Commercial St, Willits, CA 95490.
16 This page left intentionally blank
Governmental Business-type
Activities Activities Total
Assets:
Cash and Investments 6,594,574 $ 9,709,023 $ $ 16,303,597 Restricted Cash and Investments 318,064 318,064
Accounts Receivable 1,572,168 960,635 2,532,803
Notes Receivable 225,481 225,481
Internal Balances 967,009 (967,009)
Inventory 208,430 169,422 377,852
Capital Assets, Not Being Depreciated 2,395,094 3,295,070 5,690,164 Capital Assets, Net of Accumulated Depreciation 3,002,322 37,887,636 40,889,958 Total Assets 14,965,078 51,372,841 66,337,919
Deferred Outflows of Resources:
Pension related 3,586,798 998,526 4,585,324
Total Deferred Outflows of Resources 3,586,798 998,526 4,585,324 Liabilities:
Accounts Payable 993,883 709,518 1,703,401
Interest Payable 221,992 221,992
Deposits Payable 42,047 91,299 133,346
Noncurrent Liabilities:
Net Pension Liability 8,456,741 2,354,266 10,811,007
Due Within One Year 239,697 571,026 810,723
Due in More Than One Year 239,696 21,090,218 21,329,914 Total Liabilities 9,972,064 25,038,319 35,010,383
Deferred Inflows of Resources:
Pension related 826,141 229,989 1,056,130
Total Deferred Inflows of Resources 826,141 229,989 1,056,130 Net Position:
Net Investment in Capital Assets 5,397,416 20,862,764 26,260,180 Restricted for:
Community Development 263,136 263,136
Streets and Roads 2,602,777 2,602,777
Public Safety 137,163 137,163
Unrestricted (646,821) 6,240,295 5,593,474
Total Net Position $ 7,753,671 $ 27,103,059 $ 34,856,730
CITY OF WILLITS
Statement of Net Position
June 30, 2023
The notes to the financial statements are an integral part of this statement. 17 Operating Capital
Charges for Grants and Grants and
Expenses Services Contributions Contributions
Primary Government:
Governmental Activities:
General Government $ 1,326,066 $ 653,683 $ 816,571 $ 327,827 Public Safety 2,238,397 9,775
Community Development 1,093,302
Public Works 1,203,480 100,000 1,388,088
Parks and Recreation 338,603
Planning 295,574
Total Governmental Activities 6,495,422 663,458 916,571 1,715,915 Business-type Activities:
Water 2,978,401 3,023,239 678
Sewer 3,550,081 3,854,739
Solid Waste 155,986
Airport 271,544 117,692
Total Business-type Activities 6,956,012 6,995,670 678
Total Primary Government $ 13,451,434 $ 7,659,128 $ 916,571 $ 1,716,593 Taxes:
Property Taxes
Sales and Use Taxes
Business License Taxes
Franchise
Transient Occupancy Taxes
Other Taxes
Licenses and Permits
Investment Earnings
Other Revenue
Transfers
Total General Revenues and Transfers
Change in net position
Net Position - Beginning of Fiscal Year
Net Position - End of Fiscal Year
Functions
General Revenues:
Program Revenues
The notes to the financial statements are an integral part of this statement.
CITY OF WILLITS
Statement of Activities
For the Fiscal Year Ended June 30, 2023
18 Net (Expenses) Revenues and Changes in Net Position
BusinessGovernmental type
Activities Activities Total
$ 472,015 $ - 472,015 $
(2,228,622) (2,228,622)
(1,093,302) (1,093,302)
284,608 284,608
(338,603) (338,603)
(295,574) (295,574)
(3,199,478) (3,199,478)
45,516 45,516
304,658 304,658
(155,986) (155,986)
(153,852) (153,852)
40,336 40,336
(3,199,478) 40,336 (3,159,142)
575,240 575,240
3,091,646 3,091,646
138,277 138,277
351,226 351,226
302,219 302,219
100,838 100,838
97,999 97,999
84,683 93,361 178,044
669,594 669,594
25,853 (25,853)
5,437,575 67,508 5,505,083
2,238,097 107,844 2,345,941
5,515,574 26,995,215 32,510,789
$ 7,753,671 $ 27,103,059 $ 34,856,730
19 Special Revenue Capital Projects
Nonmajor Total
Governmental Governmental
General Sales Tax Capital Outlay Funds Funds
Assets:
Cash and Investments $ 3,662,635 $ 2,268,632 $ 319,071 $ 344,236 $ 6,594,574 Accounts Receivable 1,289,589 201,787 80,792 1,572,168
Interest Receivable - -
Due from Other Funds 1,284,147 1,284,147
Loans Receivable 225,481 225,481
Inventory 208,430 208,430
Total Assets $ 6,444,801 $ 2,470,419 $ 319,071 $ 650,509 $ 9,884,800 Liabilities and Fund Balances:
Liabilities:
Accounts Payable $ 812,386 $ 32,769 130,242 $ 18,486 $ 993,883 Deposits Payable 28,072 9,909 4,066 42,047
Due to Other Funds 317,138 317,138
Total Liabilities 840,458 32,769 140,151 339,690 1,353,068 Fund Balances:
Nonspendable 208,430 208,430
Restricted for:
Public Safety 137,163 137,163
Public Works 2,437,650 165,127 2,602,777
Community Development 263,136 263,136
IT Projects -
Committed 178,920 178,920
Unassigned 5,395,913 (254,607) 5,141,306
Total Fund Balances 5,604,343 2,437,650 178,920 310,819 8,531,732 Total Liabilities and Fund Balances $ 6,444,801 $ 2,470,419 $ 319,071 $ 650,509 $ 9,884,800
CITY OF WILLITS
Balance Sheet
Governmental Funds
June 30, 2023
The notes to the financial statements are an integral part of this statement. 20 Total fund balances - governmental funds $ 8,531,732 In governmental funds, only current assets are reported. In the statement of net position, all assets are reported, including capital assets and accumulated depreciation.
Capital assets at historical cost $ 9,373,628
Accumulated depreciation (3,976,212) 5,397,416
(826,141)
3,586,798
In governmental funds, only current liabilities are reported. In the statement of net position, all liabilities, including long-term liabilities, are reported. Long-term liabilities relating to governmental activities consist of:
Net pension liability (8,456,741)
Compensated absences payable (479,393)
Total net position - governmental activities $ 7,753,671 The notes to the financial statements are an integral part of this statement.
Deferred inflows related to pension
Deferred outflows related to pension
CITY OF WILLITS
Reconciliation of the Governmental Funds Balance Sheet
June 30, 2023
to the Statement of Net Position
Deferred outflows and inflows of resources relating to pensions: In governmental funds, deferred outflows and inflows of resources relating to pensions are not reported because they are applicable to future periods. In the statement of net position, deferred outflows and inflows of resources relating to pensions are reported. 21 Special Revenue Capital Projects
Nonmajor Total
Governmental Governmental
General Sales Tax Capital Outlay Funds Funds
Revenues
Property Taxes $ 575,240 $ - $ - $ - $ 575,240
Sales and Use Taxes 3,091,646 882,658 3,974,304 -
Business License Taxes 138,277 138,277
Franchise Fees 351,226 351,226
Transient Occupancy Taxes 302,219 302,219
Other Taxes 100,838 100,838
Licenses and Permits 97,999 97,999
Interest 33,774 46,663 335 3,911 84,683
Charges for Services 653,683 9,775 663,458
Intergovernmental 816,571 100,000 327,827 505,430 1,749,828 Other 669,594 669,594
Total Revenues 6,831,067 1,029,321 328,162 519,116 8,707,666 Expenditures
Current:
General Government 2,008,717 7,500 2,016,217
Planning 295,574 295,574
Public Safety 2,984,449 65,481 3,049,930
Public Works 224,507 496,508 80,255 402,210 1,203,480
Parks and Recreation 338,603 338,603
Community Development 623,302 470,000 1,093,302
Capital Outlay 1,991,381 1,991,381
Total Expenditures 6,475,152 496,508 2,079,136 937,691 9,988,487 Excess (Deficiency) of Revenues over
(under) Expenditures 355,915 532,813 (1,750,974) (418,575) (1,280,821) Other Financing Sources (Uses):
Transfers In 41,722 1,398,649 1,440,371
Transfers Out (1,410,001) (4,517) (1,414,518)
Total Other Financing Sources (Uses) 41,722 (1,410,001) 1,398,649 (4,517) 25,853 Net Change in Fund Balances 397,637 (877,188) (352,325) (423,092) (1,254,968) Fund Balances - June 30, 2022 5,206,706 3,314,838 531,245 733,911 9,786,700 Fund Balances - June 30, 2023 $ 5,604,343 $ 2,437,650 $ 178,920 $ 310,819 $ 8,531,732 The notes to the financial statements are an integral part of this statement.
CITY OF WILLITS
Statement of Revenues, Expenditures, and Changes in Fund Balance Governmental Funds
For the Fiscal Year Ended June 30, 2023
22 Amounts reported for governmental activities in the statement of activities are different because:
Net change in fund balances - total governmental funds $ (1,254,968) Governmental funds report capital outlays as expenditures. However, in the statement of activities, the costs of those capital assets are allocated over their estimated useful lives as depreciation expense. This is the amount by which capital outlay exceeded depreciation in the current period.
Capital outlay $ 1,991,381
Depreciation expense (121,381) 1,870,000
In governmental funds, pension costs are recognized when employer contributions are made. In the 1,623,065
Change in net position of governmental activities $ 2,238,097 The notes to the financial statements are an integral part of this statement.
CITY OF WILLITS
Reconciliation of the Statement of Revenues, Expenditures, and Changes in For the Fiscal Year Ended June 30, 2023
Fund Balances of Governmental Funds to the Statement of Activities statement of activities, pension costs are recognized on the accrual basis. This fiscal year, the difference between accrual-basis pension costs and actual employer contributions was:
23 Nonmajor
Sewer Water Enterprise
Fund Fund Funds Total
Assets
Current Assets:
Cash and Investments $ 5,484,084 $ 4,224,939 $ 9,709,023 - $ Restricted Cash and Investments 235,429 82,635 318,064
Accounts Receivable 613,611 317,525 29,499 960,635
Due From Other Funds
Inventory 169,422 169,422
Total Current Assets 6,333,124 4,625,099 198,921 11,157,144 Noncurrent Assets:
Capital Assets:
Land 1,369,269 423,252 11,692 1,804,213
Buildings and Improvements 3,503,720 3,733,794 1,707,978 8,945,492 Machinery and Equipment 2,406,410 8,094,276 54,867 10,555,553 Infrastructure 33,776,928 13,478,300 47,255,228
Construction in Progress 1,440,793 50,064 1,490,857
Less:
Accumulated Depreciation (15,589,621) (12,603,819) (675,197) (28,868,637) Total Noncurrent Assets 25,466,706 14,566,596 1,149,404 41,182,706 Deferred Outflows of Resources:
Pension Related 647,507 351,019 998,526
Total Deferred Outflows of Resources 647,507 351,019 998,526 Total Assets and Deferred Outflows of Resources 32,447,337 19,542,714 1,348,325 53,338,376 Liabilities
Current Liabilities:
Accounts Payable 226,657 425,338 57,523 709,518
Interest Payable 207,028 14,964 221,992
Due to Other Funds 967,009 967,009
Deposits Payable 82,630 8,669 91,299
Long Term Debt - Due within One Year 426,522 144,504 571,026 Total Current Liabilities 860,207 667,436 1,033,201 2,560,844 Noncurrent Liabilities:
Compensated Absences 35,327 32,841 68,168
Net Pension Liability 1,526,655 827,611 2,354,266
Long Term Debt - Due in More Than One Year 17,916,161 2,224,297 881,592 21,022,050 Total Noncurrent Liabilities 19,478,143 3,084,749 881,592 23,444,484 Deferred Inflows of Resources:
Pension Related 149,139 80,850 229,989
Total Deferred Inflows of Resources 149,139 80,850 229,989 Total Liabilities and Deferred Inflows of Resources 20,487,489 3,833,035 1,914,793 26,235,317 Net Position
Net Investment in Capital Assets 7,394,345 12,319,015 1,149,404 20,862,764 Unrestricted 4,565,503 3,390,664 (1,715,872) 6,240,295
Total Net Position $ 11,959,848 $ 15,709,679 $ (566,468) $ 27,103,059 The notes to the financial statements are an integral part of this statement.
CITY OF WILLITS
Statement of Net Position
Proprietary Funds
June 30, 2023
Business-type Activities-Enterprise Funds
24 Nonmajor
Sewer Water Enterprise
Fund Fund Funds Total
Operating Revenues:
Charges for Services 3,854,739 $ 3,023,239 $ 117,692 $ 6,995,670 $ Total Operating Revenues 3,854,739 3,023,239 117,692 6,995,670 Operating Expenses:
Operations 1,057,771 1,026,169 141,063 2,225,003
Administrative 268,279 589,546 27,405 885,230
Materials and Supplies 672,325 502,280 1,174,605
Maintenance 48,321 134,916 165,087 348,324
Depreciation 909,650 725,490 93,975 1,729,115
Total Operating Expenses 2,956,346 2,978,401 427,530 6,362,277 Operating Income (Loss) 898,393 44,838 (309,838) 633,393 Non-operating Revenues (Expenses):
Interest Revenue 48,811 44,614 (64) 93,361
Interest Expense (593,735) (593,735)
Intergovernmental Revenue 678 678
Total Non-Operating Revenue (Expenses) (544,924) 45,292 (64) (499,696) Income (Loss) Before Transfers 353,469 90,130 (309,902) 133,697 Transfers
Transfers In 67,816 67,816
Transfers Out (93,669) (93,669)
Total Transfers (25,853) (25,853)
Change in Net Position 353,469 64,277 (309,902) 107,844 Net Position - Beginning of Fiscal Year 11,606,379 15,645,402 (256,566) 26,995,215 Net Position - End of Fiscal Year $ 11,959,848 $ 15,709,679 $ (566,468) $ 27,103,059 Business-type Activities - Enterprise Funds
CITY OF WILLITS
Statement of Revenues, Expenses, and Changes in Net Position Proprietary Funds
For the Fiscal Year Ended June 30, 2023
The notes to the financial statements are an integral part of this statement. 25 Nonmajor
Sewer Water Enterprise
Fund Fund Funds
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash Received from Users $ 3,525,569 $ 3,105,869 $ 89,956 $ 6,721,394 Cash Payments to Suppliers and Contractors (889,977) (1,139,283) (332,749) (2,362,009) Cash Payments to Employees (1,379,651) (1,186,247) (2,565,898) Net Cash Provided (Used) By Operating Activities 1,255,941 780,339 (242,793) 1,793,487 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Interfund Borrowing (25,853) 349,412 323,559
Intergovernmental 678 678
Net Cash Provided (Used) By Noncapital Financing Activities (25,175) 349,412 324,237 CASH FLOWS FROM INVESTING ACTIVITIES:
Interest Received 48,811 44,614 (64) 93,361
Net Cash Provided (Used) in Investing Activities 48,811 44,614 (64) 93,361
CASH FLOWS FROM CAPITAL AND RELATED FINANCING
ACTIVITIES:
Miscellaneous Revenue
Principal Payments on Debt Borrowings (379,727) (105,919) (485,646) Interest Paid (520,370) (6,383) (526,753)
Acquisition of Property, Plant, and Equipment (99,947) (1,087,037) (106,555) (1,293,539) Net Cash Provided (Used) In Capital and Related
Financing Activities (1,000,044) (1,199,339) (106,555) (2,305,938)
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS 304,708 (399,561) - (94,853)
CASH AND CASH EQUIVALENTS, BEGINNING OF FISCAL YEAR 5,414,805 4,707,135 - 10,121,940 CASH AND CASH EQUIVALENTS, END OF FISCAL YEAR $ 5,719,513 $ 4,307,574 $ - $ 10,027,087 Reconciliation to Statement of Net Position:
Cash and Investments $ 5,484,084 $ 4,224,939 $ - $ 9,709,023 Restricted Cash and Investments 235,429 82,635 318,064
$ 5,719,513 $ 4,307,574 $ - $ 10,027,087
CASH FLOWS FROM OPERATING ACTIVITIES:
Operating Income (Loss) $ 898,393 $ 44,838 $ (309,838) $ 633,393 Adjustment to Reconcile Operating Income
(Loss) to Net Cash Provided (Used) by Operating
Activities:
Depreciation 909,650 725,490 93,975 1,729,115
Changes in Assets, Deferred Outflows, Liabilities and Deferred Inflows:
(Increase) Decrease in Accounts Receivable (329,170) (27,936) (357,106) Increase (Decrease) in Accounts Payable 98,948 168,028 35,384 302,360 Increase (Decrease) in Compensated Absences (28,877) (1,238) (30,115) Increase (Decrease) in Net Pension Liability (293,003) (158,840) (451,843) Increase (Decrease) in Deposits Payable 2,061 200 2,261 (Increase) Decrease in Inventory (34,578) (34,578)
Total Adjustments 357,548 735,501 67,045 1,160,094
Net Cash Provided (Used) By Operating Activities $ 1,255,941 $ 780,339 $ (242,793) $ 1,793,487 The notes to the financial statements are an integral part of this statement.
Totals
Business-type Activities - Enterprise Funds
CITY OF WILLITS
PROPRIETARY FUNDS
For the Fiscal Year Ended June 30, 2023
STATEMENT OF CASH FLOWS
26 Private Purpose
Trust Fund
RDA
Successor
Agency
ASSETS
Cash and Investments $ 692,600
Cash and Investments with Fiscal Agent 231
Total Assets 692,831
LIABILITIES
Interest Payable $ 42,148
Accounts Payable 1,163
Long-term Debt, Due Within One Year 302,364
Long-term Debt, Due in More Than One Year 309,416
Total Liabilities 655,091
NET POSITION
Held in Trust for Others 37,740
Total Net Position $ 37,740
The notes to the financial statements are an integral part of this statement. 27 CITY OF WILLITS
FIDUCIARY FUNDS
STATEMENT OF NET POSITION
June 30, 2023
Private Purpose
Trust Fund
RDA
Successor
Agency
Additions:
Intergovernmental $ 529,957
Interest 8,516
Total Additions 538,473
Deductions:
Community Development 20,671
Interest Expense 18,782
Total Deductions 39,453
Change in Net Position 499,020
Net Position - June 30, 2022 (158,916)
Prior period adjustment (302,364)
Net Position, July 1, 2022, Restated (461,280)
Net Position - June 30, 2023 $ 37,740
28 The notes to the financial statements are an integral part of this statement.
CITY OF WILLITS
FIDUCIARY FUNDS
STATEMENT OF CHANGES IN NET POSITION
For the Fiscal Year Ended June 30, 2023
NOTES TO BASIC FINANCIAL STATEMENTS
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
29 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
The City of Willits (City) is a general law City incorporated in the State of California. The City is governed by an elected five-member City Council. The following services are provided by the City to its citizens; public safety (police); streets; drinking water; wastewater collection, treatment and disposal; public improvements, parks and recreation; planning and zoning; and general administrative services.
As required by accounting principles generally accepted in the United States of America (USGAAP), these basic financial statements present the City of Willits (the primary government) and any component units.
Individual Component Unit Disclosures
There are no entities which meet the Governmental Accounting Standards Board (GASB) Statement No.14 as amended by GASB Statement No.39 and GASB Statement No. 61 criteria for disclosure within these financial statements.
Description of Joint Powers Agreements
The City participates in several joint power agreements (JPAs) as described in Note 8. The financial activities of the JPAs are not included in the accompanying basic financial statements because JPAs are administered by governing boards that are separate from and independent of the City.
B. Basis of Presentation
Government-wide Financial Statements
The statement of net position and statement of activities display information about the primary government (the City). These statements include the financial activities of the overall government, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. These statements distinguish between the governmental and business-type activities of the City. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely, to a significant extent, on fees charged to external parties.
The statement of activities presents a comparison between direct expenses and program revenues for each segment of the business-type activities of the City and for each function of the City’s governmental activities. Direct expenses are those that are specifically associated with a program or function and; therefore, are clearly identifiable to a particular function. Program revenues include 1) charges paid by the recipients of goods or services offered by the programs and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented instead as general revenues.
When both restricted and unrestricted net positions are available, unrestricted resources are used only after the restricted resources are depleted.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
30 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) B. Basis of Presentation (Continued)
Fund Financial Statements
The fund financial statements provide information about the City’s funds, including fiduciary funds.
Separate statements for each fund category – governmental, proprietary, and fiduciary – are presented. The emphasis of fund financial statements is on major governmental and enterprise funds; each displayed in a separate column. All remaining governmental and enterprise funds are separately aggregated and reported as nonmajor funds.
Proprietary funds distinguish operating revenues, such as charges for services, and result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up essentially equal values. Nonoperating revenues, such as subsidies and investment earnings, result from nonexchange transactions or ancillary activities.
The City reports four major governmental funds:
The General Fund is used to account for all revenues and expenditures necessary to carry out basic governmental activities of the City that are not accounted for through other funds. For the City, the General Fund includes activities such as public protection, public works and facilities, parks and recreation, and community development.
The Sales Tax Special Revenue Fund was established to account for all sales tax revenues set aside for transportation improvements.
The Gas Tax Special Revenue Fund was established to account for capital expenditures, maintenance, rehabilitation, reconstruction and construction of City streets and roads funded by State gas taxes.
The Capital Outlay Capital Projects Fund was established to account for capital expenditures throughout the City.
The City reports the following two major enterprise funds:
The Sewer Fund was established to account for the financial activity for the purpose of operation and maintenance of the City’s sewer system including the wastewater treatment plant. The costs of providing these services to the general public are financed or recovered through user charges. The Water Fund was established to account for the financial activity for the purpose of operation and maintenance of City’s water utility. The costs of providing these services to the general public are financed or recovered through user charges.
Fiduciary Funds
Agency Funds are used to account for assets held by the City in a trustee capacity or as an agent for individuals, private organizations, other government units, and/or other funds.
Private Purpose Trust Fund accounts for the operations of the former redevelopment agency.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
31 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Basis of Accounting and Measurement Focus
The government-wide, proprietary, and fiduciary fund financial statements except for Agency Funds (that have no measurement focus) are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time the liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the City gives (or receives) value without directly receiving (or giving) equal value in exchange, include property and sales taxes, grants, entitlements and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenues from sales tax are recognized when the underlying transactions take place.
Revenues from grants, entitlements, and donations are recognized in the fiscal year in which all eligible requirements have been satisfied.
Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when susceptible to accrual (i.e., when they are "measurable and available"). "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to pay liabilities of the current period. The City considers all revenues available if they are collected within 60 days after fiscal year-end. Expenditures are recorded when the related fund liability is incurred, except for debt service expenditures which are recognized when due, and certain compensated absences and claims and judgments which are recognized when the obligations are expected to be liquidated with expendable available financial resources. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds from long-term debt and capital leases are reported as other financing sources.
Property taxes, transient occupancy taxes, and interest are susceptible to accrual. Sales taxes collected and held by the state at fiscal year-end on behalf of the City are also recognized as revenue.
Other receipts and taxes become measurable and available when cash is received by the City and are recognized as revenue at that time.
Entitlements and shared revenues are recorded at the time of receipt or earlier if the susceptible to accrual criteria are met. Expenditure-driven grants are recognized as revenue when the qualifying expenditures have been incurred and all other grant requirements have been met.
D. Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources, Net Position or Equity
1. Deposits and Investments
In order to maximize the flexibility of its investment program and to aid in cash budgeting, the City pools the cash of all funds, except for monies deposited with fiscal agents in accordance with related bond indentures. The cash and investments balance in each fund represents that fund’s equity share of the City’s cash and investment pool. As the City places no restrictions on the deposit or withdrawal of a particular fund’s equity in the pool, the pool operates like a demand deposit account for the participating funds.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
32 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources, Net Position or Equity (Continued)
1. Deposits and Investments (Continued)
Interest income earned on pooled cash and investments is allocated monthly to the various funds based on month-end balances and is adjusted at fiscal year-end. Interest income on restricted cash and investments with fiscal agents is credited directly to the related fund.
In accordance with the State of California Government Code, the City adopts an investment policy annually that, among other things, authorizes types and concentrations of investments and maximum investment terms.
The City’s investments are carried at fair value. The fair value of equity and debt securities is determined based on sales prices or bid-and-asked quotations from SEC-registered securities exchanges or NASDAQ dealers. LAIF determines the fair value of its portfolio quarterly and reports a factor to the City; the City applies that factor to convert its share of LAIF from amortized cost to fair value. Changes in fair value are allocated to each participating fund.
For purposes of the statement of cash flows, the City has defined cash and cash equivalents to be change and petty cash funds, equity in the City’s cash and investment pool, and restricted non-pooled investments with initial maturities of three months or less.
Investments are stated at fair value in accordance with GASB Statement No.31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools. Short-term investments are reported at cost, which approximates fair value. The fair values are based on quoted market prices, if available, or estimated using quoted market prices for similar securities. Securities traded on national or international exchanges are valued at the last reported sales price at current exchange rates. Interest, dividends, and realized and unrealized gains and losses, based on the specific identification method, are included in interest revenue when earned.
2. Receivables and Payables
Transactions between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as "due to/from other funds." Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as “internal balances”. Advances between funds are reported in the fund financial statements as nonspendable to indicate that they are not available for appropriation and are not available financial resources.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
33 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources, Net Position or Equity (Continued)
2. Receivables and Payables (Continued)
The County of Mendocino assesses properties, bills for, collects, and distributes property taxes for the City per the following schedule:
Secured Unsecured
Valuation dates January 1 January 1
Lien/levy dates July 1 July 1
Due dates 50% on November 1 July 1
50% on February 1
Delinquent as of December 10, April 10 August 31
The term “unsecured” refers to taxes on personal property other than real estate, land, and buildings.
These taxes are secured by liens on the property being taxed. Property tax revenues are recognized by the City in the fiscal year they are assessed provided they become available as defined above. The City has elected to receive the City’s portion of the property taxes from the county under the county Teeter Bill program. Under this program, the City receives 100 percent of the City’s share of the levied property taxes in periodic payments with the county assuming the responsibility for the delinquencies.
3. Inventories and Prepaid Items
Inventories are valued at cost using the first-in/first-out (FIFO) method. The costs of governmental fund-type inventories are recorded as expenditures when consumed rather than when purchased.
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items.
4. Capital Assets
Capital assets, which include property, plant, equipment and infrastructure assets, are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. As a phase 3 government under GASB Statement No.34, the City has elected to restate its capital assets as of July 1, 2008, to report infrastructure assets acquired prior to June 30, 2003. The City has determined that it is preferable to report all City infrastructure to provide for more accurate reporting. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated assets are valued at the fair value of the assets on the date on which they were contributed. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend the assets’ lives are not capitalized. The City utilizes a capitalization threshold of $10,000.
Depreciation is charged to operations using the straight-line method over the estimated useful lives of the assets as follows:
Buildings and improvements 30 years
Vehicles 5 years
Machinery and equipment 5 to 15 years
Infrastructure 50 to 80 years
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
34 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources, Net Position or Equity (Continued)
5. Compensated Absences
Full-time employees accumulate earned vacation, holiday and compensated leave of varying amounts dependent upon length of service with the City. These amounts are deemed fully vested with the employee when earned. The City also provides full time employees with sick leave that generally must be used for sickness and injury-related leave time. However, upon an employee’s retirement after 5 years of employment with the City, an employee is paid 30% of unused sick leave and after 10 years of employment, they are paid 50%. In both cases the limit is 1,000 hours. Therefore, a liability has been recorded for the estimated benefits that will be taken as a result of retirement. These liabilities will be liquidated in their respective business-type funds or the general fund as they are used or upon retirement.
The City does not offer post-employment benefits.
6. Long-term Obligations
In the government-wide financial statements, proprietary and fiduciary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, proprietary or fiduciary fund type statements of net position. Debt premiums and discounts are deferred and amortized over the life of the indebtedness using the straight-line method. Notes payable are reported net of the applicable bond premium or discount.
In the fund financial statements, governmental fund types recognize debt premiums and discounts during the current period. The face amount of debt issued is reported as other financing sources.
Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.
7. Net Position
The government-wide financial statements utilize a net position presentation. Net position is categorized as net investment in capital assets, restricted, and unrestricted.
Net Investment In Capital Assets – This category groups all capital assets, including infrastructure, into one component of net position. Accumulated depreciation and the outstanding balances of debt that are attributable to the acquisition, construction, or improvement of these assets reduce the balance in this category.
Restricted Net Position – This category presents external restrictions imposed by creditors, grantors, contributors, or laws or regulations of other governments and restrictions imposed by law through constitutional provisions or enabling legislation.
Unrestricted Net Position – This category represents net position of the City, not restricted for any project or other purpose.
When an expense is incurred for purposes for which both restricted and unrestricted resources are available, the City’s policy is to apply restricted resources first.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
35 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources, Net Position or Equity (Continued)
8. Deferred Outflows and Inflows of Resources
Pursuant to GASB Statement No. 68 and 71, the City recognizes deferred outflows and inflows of resources. Deferred outflow and inflow of resources are defined as a consumption or resource of net position by the government that is applicable to a future reporting period.
E. Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements. Estimates also affect the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
F. Fund Balance
In the fund financial statements, governmental funds report fund balance as nonspendable, restricted, committed, assigned, or unassigned based primarily on the extent to which the City is bound to honor constraints on how specific amounts can be spent.
• Nonspendable fund balance – amounts that cannot be spent because they are either (a) not spendable in form or (b) legally or contractually required to be maintained intact. • Restricted fund balance – amounts with constraints placed on their use that are either (a) externally imposed by creditors, grantors, contributors, or laws or regulations of other governments; or (b) imposed by law through constitutional provisions or enabling legislation. • Committed fund balance – amounts that can only be used for specific purposes determined by formal action of the City’s highest level of decision-making authority (the City Council) and that remain binding unless removed in the same manner. The underlying action that imposed the limitation needs to occur no later than the close of the reporting period. • Assigned fund balance – amounts that are constrained by the City’s intent to be used for specific purposes. The intent can be established at either the highest level of decision making, or by a body or an official designated for that purpose. • Unassigned fund balance – the residual classification for the City’s funds that include amounts not contained in the other classifications.
The City Council establishes, modifies or rescinds fund balance commitments and assignments by passage of an ordinance or resolution.
When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, followed by committed, assigned, and unassigned resources as they are needed.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
36 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) G. New GASB Pronouncements
Implementation of New Accounting Pronouncements
GASB Statement No. 96, SBITAs
This Statement provides guidance on the accounting and financial reporting for subscription-based information technology arrangements (SBITAs) for government end users (governments). The City did not report any significant accounting changes from the implementation of this Statement during the fiscal year ended June 30, 2023.
Future Accounting Pronouncements
GASB Statements listed below will be implemented in future financial statements.
The provisions for GASB Statement Number 99, “Omnibus 2022” are effective for fiscal year beginning after June 15, 2023.
The provisions of Statement Number 100 “Accounting Changes and Error Corrections – an amendment of GASB Statement No. 62” are effective for fiscal years beginning after June 15, 2023.
The provisions of Statement Number 101 “Compensated Absences” are effective for fiscal years beginning after December 15, 2023.
NOTE 2 - STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
A. Budgetary Information
The City Council adopts an Annual Budget no later than the second meeting of June of each fiscal year for the fiscal year commencing the following July 1. The City follows these procedures in establishing the budgetary data reflected in the financial statements:
1. During May of each fiscal year, the City Manager submits to the City Council a proposed operating budget for the next following fiscal year. The operating budget includes proposed revenues and expenditures.
2. After a review by the City Council, a public hearing is conducted and further comment is received from the City Council and the general public.
3. Upon completion of the hearings and modifications, if any, to the proposed budget, it is adopted by the City Council through passage of an appropriate resolution.
4. Generally, the budget is amended in the middle of the fiscal year and at the end of the fiscal year.
All approved additional appropriations are added to the adopted budget and an amended budget is presented to the City Council, which adopts it after due review.
5. The City Manager is authorized to make transfers between operational expenditure categories within certain departments and funds.
6. City Council approval is required for all fund to fund transfers, department to department transfers, fund reserve to appropriations transfers, transfers for new revenue sources with offsetting appropriations, and for transfer to/from the capital expenditure category.
7. The Haehl Creek, Business Rehab, Vehicle Abatement, HSG Rehab, H&S Restitution, DNA Cost Reimb, Business Loan, Lateral Repair Loan, Measure K Sales Tax special revenue funds do not have adopted budgets.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
37 NOTE 2 - STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (Continued) B. Budget/USGAAP Reconciliation
No funds adopted project-length or budgetary basis budgets and, therefore, no schedule reconciling the amounts on the Combined Statement of Revenues, Expenditures, and Changes in Fund BalanceBudget to Actual to the amounts on the Combined Statement of Revenues, Expenditures, and Changes in Fund Balances has been prepared.
C. Excess of Expenditures over Appropriations
For the fiscal year ended June 30, 2023, expenditures exceeded appropriations in the following funds:
Final
Fund Appropriation Expenditure Excess
Major Funds:
Capital Outlay Capital Projects Fund $ 1,301,000 $ 2,079,136 $ 778,136 Nonmajor Funds:
Gas Tax Special Revenue Fund 298,831 402,210 103,379
LEAA Program Special Revenue Fund 5,604 22,277 16,673
Traffic Safety Special Revenue Fund 15,389 19,247 3,858 D. Deficit Fund Equity
At June 30, 2023, the following fund had an accumulated deficit:
Fund Amount
Major Governmental Fund:
Gas Tax $ 249,351
Nonmajor Governmental Fund:
Vehicle Abatement 5,256
Nonmajor Enterprise Fund:
Solid Waste 1,580,929
The City believes that portions if not the majority of the costs and debt associated with this fund are the responsibility of the State or the County. The City is currently in discussions with both entities to securing funding for these and future costs.
The City believes that operations in the subsequent fiscal year will rectify negative fund balances in the other funds listed. Otherwise, the City will make transfers from the General Fund to offset any deficits.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
38 NOTE 3 – 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 $ 16,303,597
Restricted cash and investments 318,064
Fiduciary funds:
Cash and investments 692,600
Cash and investments with fiscal agent 231
Total cash and investments $ 17,314,492
Cash and investments as of June 30, 2023 consist of the following:
Cash on hand $ 550
Deposits with financial institutions 8,696,598
Investments 8,617,344
Total cash and investments $ 17,314,492
A. Investments Authorized by the California Government Code and the City’s Investment Policy
The table below identifies the investment types that are authorized for the City of Willits (City) by the California Government Code (or the City’s investment policy, where more restrictive). The table also identifies certain provisions of the California Government Code (or the City’s investment policy, where more restrictive) that address interest rate risk, credit risk, and concentration of credit risk.
This table does not address investments of debt proceeds held by bond trustee that are governed by the provisions of debt agreements of the City rather than the general provisions of the California Government Code or the City’s investment policy.
Maximum Maximum
Maximum Percentage Investment
Maturity of Portfolio in One Issuer
Bonds issued by the City N/A None None
US Treasury Obligations 5 years None None
Federal Agency Issues 5 years None None
Negotiable Certificates of Deposit 5 years 30% None
Repurchase Agreements 1 year None None
Bankers' Acceptances 180 days 40% 30%
Medium Term Notes 5 years 30% None
Money Market Mutual Funds N/A None 10%
Commercial Paper 270 days 25% None
County Pool Investment Funds N/A None None
Local Agency Investment Fund (LAIF) N/A None $75 Million Collateralized Bank Deposits N/A None None
Mortgage Pass-through Securities 5 years 20% None
Shares of Beneficial Interest by a JPA N/A None None
Authorized Investment Type
The investment policy allows for the above investments which have equal safety and liquidity as all other allowed investments. Maturity depends on the cash needs of the City.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
39 NOTE 3 – CASH AND INVESTMENTS (Continued)
B. Investments Authorized by Debt Agreements
Investment of debt proceeds held by bond trustees are governed by provisions of the debt agreements rather than the general provisions of the California Government Code or the City’s investment policy.
The table below identifies the Investment types that are authorized for investments held by bond trustee. The table also identifies certain provisions of these debt agreements that address interest rate risk, credit risk, and concentration of credit risk.
Maximum Maximum
Maximum Percentage Investment
Maturity of Portfolio in One Issuer
Local Agency Bonds N/A None None
U.S. Treasury Obligations N/A None None
State Obligations N/A None None
U.S. Government Agency Issues N/A None None
Money Market Mutual Fund N/A None None
Bankers Acceptances N/A None None
Commercial Paper 270 days None None
Certificates of Deposit N/A None None
Repurchase Agreements N/A None None
Investment Agreements N/A None None
Local Agency Investment Fund (LAIF) N/A None None
Authorized Investment Type
C. 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 City 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 values of the City’s investments (including investments held by bond trustee) to market interest rate fluctuations is provided by the following table that shows the distribution of the City’s investments by maturity:
12 Months 13 to 24 25-60 More Than 60
Totals or Less Months Months Months
State Investment Pool (LAIF) 4,708,264 $ $ 4,708,264 $ - $ - $ - Certificates of Deposit 2,917,729 248,047 1,692,184 977,498 US Government Securities 991,351 991,351
$ 8,617,344 $ 5,947,662 $ 1,692,184 977,498 $ $ -
Remaining maturity (in Months)
Investment Type
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
40 NOTE 3 – CASH AND INVESTMENTS (Continued)
D. Investments with Fair Values Highly Sensitive to Interest Rate Fluctuations The City has no investments (including investments held by bond trustees) that are highly sensitive to interest rate fluctuations (to a greater degree than already indicated in the information provided above).
E. Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the minimum rating required by (where applicable) the California Government Code, the City’s investment policy, or debt agreements, and the actual rating as of fiscal year end for each investment type.
Minimum Exempt
Legal From Not
Investment Type Amount Rating Disclosure AAA AA A Rated State Investment Pool $ 4,708,264 N/A $ - $ - - $ - $ 4,708,264 $ Certificates of Deposit 2,917,729 N/A 2,917,729
US Governmental Securities 991,351 N/A 991,351
Total $ 8,617,344 $ 991,351 - $ - - $ 7,625,993 $
Rating as of Fiscal Year End
F. Concentration of Credit Risk
The investment policy of the City contains limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code. There are no investments in any one issuer (other than money market or external investment pool) that represent 5% or more of total City’s investments.
G. 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 fair 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 City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits.
As of June 30, 2023, all of the City’s deposits with financial institutions in excess of federal depository insurance limits were held in collateralized accounts.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
41 NOTE 3 – CASH AND INVESTMENTS (Continued)
H. Investment in State Investment Pool
The City 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 City’s investment in this pool is reported in the accompanying financial statements at amounts based upon the City’s pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis.
I. Fair Value Measurements
The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. These principles recognize a three tiered fair value hierarchy as follows:
Level 1 – Investments reflect prices quoted in active markets; Level 2 – Investments reflect prices that are based on similar observable asset either directly or indirectly, which may include inputs in markets that are not considered active; and Level 3 – Investments reflect prices based upon unobservable sources. The City’s investments applicable to recurring fair value measurements as of June 30, 2023 are all shown at fair value.
NOTE 4 – INTERFUND TRANSACTIONS
A. Interfund Receivables and Payables
During the course of normal operations, numerous transactions occur between individual funds that may result in amounts owed between funds. Those related to goods and services type transactions are classified as “due to and from other funds”. The following presents a summary of current interfund balances at June 30, 2023.
Amount Amount
Major Fund: Nonmajor Enterprise Fund:
General Fund $ 1,284,147 Solid Waste $ 688,078
Airport 278,931
Major Fund:
Gas Tax 309,243
Nonmajor Governmental Fund:
HSG Rehab 2,639
Vehicle Abatement 5,256
Totals $ 1,284,147 Totals $ 1,284,147
Receivable Fund Payable Fund
B. Transfers between Funds
Transfers are indicative of funding for capital projects, lease payments or debt service, subsidies of various City operations, and re-allocations of special revenues. All inter-fund transfers between individual government funds have been eliminated on the government-wide statements. The following schedule briefly summarizes the City’s transfer activity for the fiscal year ended June 30, 2023:
Transfers-in Transfers-out
Major Governmental Funds:
General Fund $ 41,722 $ - Sales Tax 1,410,001
Capital Outlay 1,398,649
Major Enterprise Funds:
Water Fund 67,816 93,669
Nonmajor Governmental Funds:
Business Loan Special Revenue Fund 4,517
Totals $ 1,508,187 $ 1,508,187
Fund
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
42 NOTE 5 – CAPITAL ASSETS
Capital Asset activity for the fiscal year ended June 30, 2023 was as follows:
Balance at Balance at
June 30, 2022 Additions Deletions Transfers June 30, 2023 Governmental activities:
Capital assets, not being depreciated:
Land $ 150,963 $ - $ - $ 150,963 - $
Construction in progress 252,750 1,991,381 2,244,131
Total capital assets, not being depreciated 403,713 1,991,381 2,395,094 Capital assets, being depreciated:
Buildings and improvements 1,938,567 1,938,567
Machinery and equipment 2,150,242 2,150,242
Infrastructure 2,889,725 2,889,725
Total capital assets being depreciated 6,978,534 6,978,534 Less accumulated depreciation for:
Buildings and improvements (1,676,746) (9,615) (1,686,361) Machinery and equipment (1,947,524) (48,926) (1,996,450) Infrastructure (230,561) (62,840) (293,401)
Total accumulated depreciation (3,854,831) (121,381) (3,976,212) Total capital assets, being depreciated, net 3,123,703 (121,381) 3,002,322 Governmental activities capital assets, net $ 3,527,416 $ 1,870,000 $ - $ 5,397,416 - $ Balance at Balance at
Business-type activities: June 30, 2022 Additions Deletions Transfers June 30, 2023 Capital assets, not being depreciated:
Land $ 1,804,213 $ - $ - $ 1,804,213 - $
Construction in progress 602,643 1,013,630 (125,416) 1,490,857 Total capital assets, not being depreciated 2,406,856 1,013,630 (125,416) 3,295,070 Capital assets, being depreciated:
Buildings and improvements 8,883,297 62,195 8,945,492
Machinery and equipment 10,384,608 170,945 10,555,553
Infrastructure 47,083,041 46,771 125,416 47,255,228
Total capital assets, being depreciated 66,350,946 279,911 125,416 66,756,273 Less accumulated depreciation (27,139,522) (1,729,115) (28,868,637) Total capital assets, being depreciated, net 39,211,424 (1,449,204) 125,416 37,887,636 Business-type activities capital assets, net $ 41,618,280 $ (435,574) $ - $ 41,182,706 - $ Depreciation
Depreciation expense was charged to governmental functions as follows:
General Government $ 121,381
Total depreciation expense – governmental functions $ 121,381 Depreciation expense was charged to business-type functions as follows:
Sewer $ 909,650
Water 725,490
Airport 93,975
Total depreciation expense – business-type functions $ 1,729,115
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
43 NOTE 6 – NOTES RECEIVABLE
The City has established a number of housing assistance loan programs using HOME Investment Partnerships Program grant funds. These loans consist of several loans for first-time home buyers assistance and home rehabilitation assistance loans for qualified persons. The City also utilizes Community Development Block Grant (CDBG) to provide business assistance loans and home rehabilitation loans to qualified persons.
All housing loans are secured by deeds of trust. Loans carry interest rates ranging from 0% to 5% with repayment terms from 10 to 55 years or upon sale or transfer of property. Interest rates are set at below market rates and, in some cases, below the rate of inflation. Repayment of these loans is not assured until cash is received, and in some instances, the loans terms are extended.
NOTE 7 – LONG-TERM LIABILITIES
The following is a schedule of long-term liabilities for Governmental Activities and Business-type Activities for the fiscal year ended June 30, 2023:
Balance at Balance at Due Within
June 30, 2022 Additions Repayments June 30, 2023 One Year Governmental Activities:
Compensated absences $ 479,663 $ 239,967 $ (240,237) $ 479,393 $ 239,697 Total Governmental Activities $ 479,663 $ 239,967 $ (240,237) $ 479,393 $ 239,697 Business-type Activities:
Compensated absences $ 178,144 $ 63,686 $ (100,184) $ 141,646 $ 73,478 Debt from direct borrowings and direct placements:
State Water Revolving Fund Loan 2,436,135 (105,919) 2,330,216 105,919 2015 Tax Compliance Certificates 2,403,861 (179,727) 2,224,134 186,629 2020 Wastewater Refunding Bonds 15,745,000 (200,000) 15,545,000 205,000 Landfill Post-closure Costs 881,592 881,592
Total Business-type Activities $ 21,644,732 $ 63,686 $ (585,830) $ 21,122,588 $ 571,026
1. Business-type Activities – Direct Borrowings and Placements of Debt – California State Water Resources Control Board Revolving Loan
In November of 2011, The City Council adopted a resolution approving funding in the amount of $5,779,623 for the Water Plant Improvements Project and pledged the City’s Water Fund as the specific revenue source for the repayment of the loan. The loan consists of loan principal of $3,366,510 and a grant in the amount of $3,000,000. The term of the loan is 30 years with 0% interest. The maximum loan amount $3,170,935. Principal and interest are payable semi-annually on January 1 and July 1. Annual principal payments are $105,919 and continue through the fiscal year ending 2045. In the event of a default, the full outstanding balance of the loan is due and payable.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
44 NOTE 7 – LONG-TERM LIABILITIES (Continued)
1. Business-type Activities – Direct Borrowings and Placements of Debt – California State Water Resources Control Board Revolving Loan (Continued) Annual debt service requirements for the loan are shown below:
Fiscal Year
Ended June 30, Principal Interest Total
2024 $ 105,919 $ 105,919
2025 105,919 105,919
2026 105,919 105,919
2027 105,919 105,919
2028 105,919 105,919
2029-2033 529,595 529,595
2034-2038 529,595 529,595
2039-2043 529,595 529,595
2044-2045 211,836 211,836
$ 2,330,216 $ - $ 2,330,216
State Water Revolving Fund Loan
4. Business-type Activities- Direct Borrowings and Placements of Debt – 2015 Tax Compliance Certificates
On December 1, 2015, the City issued $3,350,945 in debt to provide for refunding and redemption of the outstanding 1993 Sewer Revenue Bonds and pledged the City’s Sewer Fund as the specific revenue source for the repayment of the Bond. Interest on the bond is 3.84% and interest payments are due semi-annually on November 1 and May 1. Principal payments are due annually on November 1, ranging from $143,360 to $261,976 through the fiscal year 2033. In the event of a default, the full outstanding balance of the Loans are due and payable. Annual debt service requirements for the certificates are shown below:
Fiscal Year
Ended June 30, Principal Interest Total
2024 $ 186,629 $ 81,823 $ 268,452
2025 193,796 74,519 268,315
2026 201,237 66,934 268,171
2027 208,965 59,058 268,023
2028 216,989 50,880 267,869
2029-2033 1,216,518 120,305 1,336,823
$ 2,224,134 $ 453,519 $ 2,677,653
2015 Tax Compliance Certificates
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
45 NOTE 7 – LONG-TERM LIABILITIES (Continued)
5. Business-type Activities- Direct Borrowings and Placements of Debt – 2020 Wastewater Refunding Bond
On August 1, 2020 the City issued $16,055,000 in debt to provide for refunding and redemption of the outstanding 2007 Sewer Loans series A and B as well as the 2011 Wastewater Bond and pledged the City’s Sewer Fund as the specific revenue source for the repayment of the Bond. Interest on the bond is between 2.5% and 4% and interest payments are due semi-annually on November 1 and May
1. Principal payments are due annually on November 1, ranging from $130,000 to $885,000 through the fiscal year 2051. In the event of a default, the full outstanding balance of the Loans are due and payable. Annual debt service requirements for the certificates are shown below:
Fiscal Year
Ended June 30, Principal Interest Total
2024 $ 205,000 $ 423,412 $ 628,412
2025 215,000 415,012 630,012
2026 220,000 406,312 626,312
2027 230,000 397,313 627,313
2028 245,000 387,812 632,812
2029-2033 1,370,000 1,782,160 3,152,160
2034-2038 3,095,000 1,391,997 4,486,997
2039-2043 3,470,000 1,003,338 4,473,338
2044-2048 3,910,000 568,045 4,478,045
2049-2051 2,585,000 98,062 2,683,062
$ 15,545,000 $ 6,873,463 $ 22,418,463
2020 Wastewater Refunding Bond
Fiscal Year
Ended June 30, Principal Interest Total
2024 $ 497,548 $ 505,235 $ 1,002,783
2025 514,715 489,531 1,004,246
2026 527,156 473,246 1,000,402
2027 544,884 456,371 1,001,255
2028 567,908 438,692 1,006,600
2029-2033 3,116,113 1,902,465 5,018,578
2034-2038 3,624,595 1,391,997 5,016,592
2039-2043 3,999,595 1,003,338 5,002,933
2044-2048 4,121,836 568,045 4,689,881
2049-2051 2,585,000 98,062 2,683,062
$ 20,099,350 $ 7,326,982 $ 27,426,332
Total Business-type Activities
6. Landfill Post-closure Costs
The City’s solid waste landfill was closed during the 1997/98 fiscal year. State and federal laws and regulations require that the City place a final cover (closure) on its landfill when closed, and perform certain maintenance and monitoring functions (post-closure) at the landfill site for thirty years after closure. At June 30, 2000, the City had completed its landfill closure activities and, therefore, no closure liability is included in the accompanying financial statements. The City’s estimated liability for the continuing landfill post-closure care costs at June 30, 2022 was $881,592. However, the actual cost of post-closure care may change due to inflation, changes in technology, or changes in landfill laws and regulations.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
46 NOTE 7 – LONG-TERM LIABILITIES (Continued)
7. Compensated Absences
The City’s policy relating to compensated absences is described in Note (1). Compensated absences are liquidated primarily by the General and Enterprise Funds. The total amount outstanding at June 30, 2023, was $ 141,646 for business-type activities and $479,393 for governmental activities.
NOTE 8 – JOINT POWER AGREEMENTS
The City is a member of various joint powers authorities, which provide goods for services to the City and other authority members. Under the criteria established by GASB No. 14, the City does not have sufficient authority, influence or accountability over these entities to incorporate them in this annual report.
Additionally, the City has determined that it has no ongoing financial interest in or responsibility for any of these organizations as defined by GASB No. 14. The names and general functions of these joint powers are as follows:
Redwood Empire Municipal Insurance Fund (REMIF):
A group of Northern California cities participate in this agreement to provide themselves with various levels of liability, property and workers’ compensation insurance. REMIF is administered by a commission comprised of one member and one alternate appointed by each member city. The City provides for its general insurance needs through REMIF. During the fiscal year ended June 30, 2021, the City paid $202,708 to REMIF for insurance coverage. Beginning July 1, 2015 REMIF city members have become self-insured with their health benefits.
Mendocino Solid Waste Management Authority:
Mendocino Solid Waste Management Authority consists of three Mendocino County cities and the County of Mendocino. Mendocino Solid Waste Management Authority was created for the purpose of a) siting, licensing, developing, constructing, maintaining, and operating disposal sites and sanitary landfills and b) preparing and implementing a solid waste management plan. Mendocino Solid Waste management Authority is governed by a commission comprised of one member for each city and two members who are appointed by the Mendocino County Board of Supervisors.
Mendocino Emergency Services Authority:
Mendocino Emergency Services Authority (Authority) consists of four Mendocino County cities and the County of Mendocino. The authority was created for the purpose of coordinating disaster and other emergency preparedness planning and recovery programs, training of employees and volunteers, administration of disaster recovery assistance programs, and other related activities. The Authority is governed by a commission comprised of one member from each member agency.
Solid Waste Disposal Facility Operations Agreement:
The City and the County of Mendocino have entered into an agreement for the purpose of joint ownership, maintenance and operation of the solid waste landfill serving the City and certain unincorporated areas of the County of Mendocino. The City has been granted complete control of and authority over the administration, operation and maintenance of the landfill. The City and County will equally share the costs associated with the landfill including the purchase of equipment and closure/post-closure costs. Due to the City’s overall control of the landfill activity, the accompanying financial statements include 100% of the landfill activity, including the liability for closure/post-closure costs described in Note 7.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
47 NOTE 9 – CONTRACTED SERVICES
The City has entered into an agreement to provide services to persons living outside the City limits. The general purpose and description of this contract agreement is as follows:
Brooktrails Community Services District
The City has entered into an agreement with the District to provide the District with sewage treatment.
Under the terms of the agreement, the District is to reimburse the City for costs allocated to the District based on the ratio of total flow entering the treatment plant. The cost allocation was carried over from previous years. During the fiscal year ended June 30, 2015, the City settled a lawsuit with the District. The new District allocation of $22,000 per month began July 1, 2015 as well as 36% of the bond payments.
NOTE 10 – CONTINGENCIES
Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies, principally the federal government. Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of expenditures that may be disallowed by the grantor cannot be determined at this time although the City expected such amounts, if any, to be immaterial.
The City violated the National Primary Drinking Water Regulations maximum contaminant level for total Trihalomethanes (TTHMs) which is one of the contaminant standards required by the Safe Drinking Water Act. The cost of the violation to the City cannot be currently determined.
There are other pending lawsuits in which the City is involved. Although the outcome of these lawsuits is not presently determinable, it is the opinion of the City Attorney that the resolutions of these matters will not have a material adverse effect on the financial condition of the City.
NOTE 11 – DEFERRED COMPENSATION PLAN
The City offers its employees deferred compensation plans created in accordance with IRS Code Section 457. The plans, available to all City employees, permit employees to defer a portion of their salary until future years. Participation in the plans is optional. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. As explained previously, the City has adopted the provisions of GASB No. 32 and, therefore, assets and liabilities of these plans have been excluded from the accompanying financial statements.
NOTE 12 – PENSION PLAN
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Plans and additions to/deductions from the Plans' fiduciary net position have been determined on the same basis as they are reported by CalPERS Financial Office. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
A. General Information about the Pension Plan
Plan Descriptions - All qualified employees are eligible to participate in the City’s separate Safety (police and fire) and Miscellaneous (all other) Plans, cost sharing defined benefit pension plans administered by the California Public Employees' Retirement System (CalPERS), which acts as a common investment and administrative agent for its participating member employers. Benefit provisions under the Plans are established by State statute and Local Government resolution.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
48 NOTE 12 – PENSION PLAN (CONTINUED)
A. General Information about the Pension Plan (Continued) CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.
Benefits Provided - CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries.
Benefits are based on years of credited service, equal to one year of full time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied as specified by the Public Employees' Retirement Law.
The Plans’ provisions and benefits in effect at June 30, 2023, are summarized as follows:
Contributions - Section 20814(c) of the California Public Employees' Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July l following notice of a change in the rate. Funding contributions for both Plans are determined annually on an actuarial basis as of June 30 by CalPERS.
The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the fiscal year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees.
Prior to January 1, On or after January 1,
Hire date 2013 2013
Benefit formula 2.7% @ 55 2% @ 62
Benefit vesting schedule 5 Years Service 5 Years Service Benefit payments Monthly for life Monthly for life
Retirement age 55-55 52-67
Monthly benefits, as a % of eligible compensation 2.0% to 2.5% 1.0% to 2.5% Required employee contribution rates 8% 6.75%
Required employer contribution rates 13.35% 7.59%
City Misc Plan
Prior to January 1, On or after January 1, On or after January 1, Hire date 2012 2012 2013
Benefit formula 3.0% @ 50 3.0% @ 55 2.7% @ 57
Benefit vesting schedule 5 Years Service 5 Years Service 5 Years Service Benefit payments Monthly for life Monthly for life Monthly for life Retirement age 50-55 50-55 50-57
Monthly benefits, as a % of eligible compensation 3.00% 2.4% to 3.0% 2.0% to 2.7% Required employee contribution rates 9% 13.00% 13.00%
Required employer contribution rates 22.48% 13.13% 13.13% City Safety Plan
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
49 NOTE 12 – PENSION PLAN (Continued)
B. Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions
As of June 30, 2023, the City reported net pension liabilities for its proportionate share of the net pension liability of the Plan as follows:
Misc. Plan Safety Plan
$ 6,777,718 $ 4,033,289
Proportionate Share of Net Pension
Liability
The City’s net pension liability for the Plan is measured as the proportionate share of the net pension liability. The net pension liability of the Plan is measured as of June 30, 2022, and the total pension liability for the Plan used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2021 rolled forward to June 30, 2022 using standard update procedures. The City’s proportion of the net pension liability was based on a projection of the City’s long-term share of contributions to the pension plans relative to the projected contributions of all participating employers, actuarially determined. The City’s proportionate share of the net pension liability for the Plan as of June 30, 2021 and 2022 was as follows:
City Miscellaneous City Safety
Plan Plan
Proportion - June 30, 2021 0.209960% 0.066670%
Proportion - June 30, 2022 0.144850% 0.058700%
Change - Increase (Decrease) -0.065110% -0.007970%
For the fiscal year ended June 30, 2023, the City recognized pension expense of $1,299,908. At June 30, 2023, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
Deferred Deferred
Outflows of Inflows of
Resources Resources
Pension contributions subsequent to measurement date $ 1,267,222 $ - Net differences between projected and actual earnings on pension plan investments 1,878,411
Differences based on actual experience 303,033 (134,959) Differences based on change of assumptions 1,101,197
Differences between actual vs proportionate contribution 28,361 (139,255) Adjustment due to differences in proportions 7,100 (781,916) Total $ 4,585,324 $ (1,056,130)
$1,267,222 reported as deferred outflows of resources related to contributions subsequent to the measurement date and will be recognized as a reduction of the net pension liability in the fiscal year ended June 30, 2024. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions and will be recognized as pension expense as follows:
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
50 NOTE 12 – PENSION PLAN (Continued)
B. Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
Fiscal Year Ended
June 30, Amount
2024 $ 498,081
2025 401,836
2026 214,188
2027 1,147,867
Total $ 2,261,972
The City’s net pension liability for each Plan is measured as the total pension liability, less the pension plan's fiduciary net position. The net pension liability of each of the Plans is measured as of June 30, 2022, using an annual actuarial valuation as of June 30, 2021 rolled forward to June 30, 2022 using standard update procedures. A summary of principal assumptions and methods used to determine the net pension liability is shown below.
Actuarial Assumptions - The total pension liabilities in the June 30, 2021 actuarial valuations were determined using the following actuarial assumptions:
(1) Depending on age, service and type of employment
(2) Net of pension plan investment expenses, including inflation The underlying mortality assumptions and all other actuarial assumptions used in the June 30, 2017 valuation were based on the results of a January 2014 actuarial experience study for the period 1997 to 2011. Further details of the Experience Study can found on the CalPERS website.
Discount Rate - The discount rate used to measure the total pension liability was 6.90% for each Plan.
To determine whether the municipal bond rate should be used in the calculation of a discount rate for each plan, CalPERS stress tested plans that would most likely result in a discount rate that would be different from the actuarially assumed discount rate. Based on the testing, none of the tested plans run out of assets. Therefore, the current 6.90 percent discount rate is adequate and the use of the municipal bond rate calculation is not necessary. The long term expected discount rate of 6.90 percent will be applied to all plans in the Public Employees Retirement Fund (PERF). The stress test results are presented in a detailed report that can be obtained from the CalPERS website.
Miscellaneous Safety
Valuation Date June 30, 2021 June 30, 2021
Measurement Date June 30, 2022 June 30, 2022
Actuarial Cost Method
Actuarial Assumptions:
Discount Rate 6.90% 6.90%
Inflation 2.30% 2.30%
Payroll Growth 3.00% 3.00%
Projected Salary Increase 3.30%-14.20% (1) 3.30%-14.20% (1) Investment Rate of Return 6.90% (2) 6.90% (2)
Mortality
Entry-Age Normal Cost Method
Derived using CalPERS' Membership Data for all Funds
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
51 NOTE 12 – PENSION PLAN (Continued)
B. Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
CalPERS was scheduled to review all actuarial assumptions as part of its regular Asset Liability Management (ALM) review cycle that was scheduled to be completed in February 2018. Any changes to the discount rate will require Board action and proper stakeholder outreach. For these reasons, CalPERS expects to continue using a discount rate net of administrative expenses for GASB 67 and 68 calculations through at least the 2017-18 fiscal year. CalPERS will continue to check the materiality of the difference in calculation until such time as we have changed our methodology.
The long-term expected rate of return on pension plan investments was determined using a buildingblock method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.
In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectations as well as the expected pension fund cash flows. Using historical returns of all the funds' asset classes, expected compound returns were calculated over the short-term (first 10 years) and the long-term (11-60 years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equivalent to the single equivalent rate calculated above and rounded down to the nearest one quarter of one percent.
The table below reflects the long-term expected real rate of return by asset class. The rate of return was calculated using the capital market assumptions applied to determine the discount rate and asset allocation. These rates of return are net of administrative expenses.
Assumed Asset Real Return Real Return
Asset Class Allocation Year 1-10(a) Year 11+(b)
Global Equity 50.00% 4.80% 5.98%
Fixed Income 28.00% 1.00% 2.62%
Inflation Assets 0.00% 0.77% 1.81%
Private Equity 8.00% 6.30% 7.23%
Real Assets 13.00% 3.75% 4.93%
Liquidity 1.00% 0.00% -0.92%
a) An expected inflation of 2% used for this period
b) An expected inflation of 2.92% used for this period
Sensitivity of the Net Pension Liability to Changes in the Discount Rate -The following presents the net pension liability of the Local Government for each Plan, calculated using the discount rate for each Plan, as well as what the City's net pension liability would be if it were calculated using a discount rate that is 1 percentage point lower or 1 percentage point higher than the current rate:
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
52 NOTE 12 – PENSION PLAN (Continued)
B. Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
Pension Plan Fiduciary Net Position - Detailed information about each pension plan's fiduciary net position is available in the separately issued CalPERS financial reports.
NOTE 13 - SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY
On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X 26 (“the Bill”) that provides for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City of Willits (City) that previously had reported a redevelopment agency within the reporting entity of the City as a blended component unit.
The Bill provides that upon dissolution of a redevelopment agency, either the city or other unit of local government will agree to serve as the “successor agency” to hold the assets units until they are distributed to other units of state and local government. On January 10, 2012, the City Council elected to become the Successor Agency for the former redevelopment agency in accordance with the Bill as part of the City resolution number 2012-04. After enactment of the law, which occurred on June 28, 2011, redevelopment agencies in the State of California cannot enter into new projects, obligations or commitments. Subject to the control of a newly established oversight board, remaining assets can only be used to pay enforceable obligations in existence as of the date of the dissolution (including the completion of any unfinished projects that were subject to legally enforceable contractual commitments). Successor agencies will only be allocated revenue in the amount that is necessary to pay the estimated annual installment payments on enforceable obligations of former redevelopment agency until all enforceable obligations of the prior redevelopment agency have been paid in full and all assets have been liquidated.
Long-term debt of the Successor Agency as of June 30, 2023, consisted of the following:
Balance Balance Due within
June 30, 2022 Additions Deletions June 30, 2023 one year 2020 Tax Allocation Refunding Bonds $
943,685 - $ (302,364) - $ $ 641,321 - $ 316,530
Totals $ 1,241,247 $ - $ (302,364) $ 641,321 $ 316,530
Miscellaneous Safety
1% Decrease 5.90% 5.90%
Net Pension Liability $9,782,721 $5,897,477
Current Discount Rate 6.90% 6.90%
Net Pension Liability $6,777,718 $4,033,289
1% Increase 7.90% 7.90%
Net Pension Liability $4,305,347 $ 2,509,737
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
53 NOTE 13 - SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT
AGENCY (CONTINUED)
Tax Allocation Refunding Bonds – Series 2020
The former redevelopment agency issued $1,541,112 of tax allocation refunding bonds on January 14, 2020 to refund the Tax Allocation Bonds – Series 2002. Annual debt service requirements for the bond are shown below:
Fiscal Year
Ended June 30, Principal Interest Total
2024 316,530 11,449 327,979
2025 324,791 3,849 328,640
$ 641,321 $ 15,298 $ 656,619
2020 Tax Allocation Refunding Bonds
NOTE 14 – OTHER POST EMPLOYMENT BENEFITS
The City does not offer other post-employment benefits.
NOTE 15 – NON-COMMITMENT DEBT
The City has sponsored the issuance of $5,500,000 of Certificates of Participation for Frank R.
Howard Foundation, a nonprofit corporation. The Trust agreement is dated July 1, 2015. The funds will be used for construction; installation and furnishing of a single story 16,000 square foot medical office. The medical office will be located at 3 Marcela Drive in Willits, California. The City is not liable for repayment of the debt but was assisting the Frank R. Howard Foundation to obtain tax exempt financing.
NOTE 16 – RISK MANAGEMENT/JOINT VENTURE
A. Risk Management
The City of Willits is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omission; injuries to employees; and natural disasters. The City participates in a public entity risk pool for workers’ compensation, general liability and property insurance coverage. During fiscal year 2022-23, there were no significant reductions in insurance coverage. There has also been no significant variance in insurance coverages within the last 3 fiscal years.
B. Risk Pool Arrangements
The City is an associate member of the Redwood Empire Municipal Insurance Fund (REMIF), a public entity pool comprised of fifteen northern California charter and associate member cities.
REMIF is organized under a Joint Powers Agreement pursuant to the California Government Code.
The purpose of REMIF is to arrange and administer programs of insurance for the pooling of selfinsured losses and to purchase excess insurance coverage.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
54 NOTE 16 – RISK MANAGEMENT/JOINT VENTURE (Continued)
B. Risk Pool Arrangements (Continued)
For each of its insurance programs, REMIF has a multilevel risk sharing arrangement. Initially each individual charter or associate member city participating in a program assumes its own losses up to a predetermined deductible level. Losses and claims in excess of the deductibles and within REMIF’s stated retention limits are paid out of a central pool maintained by REMIF. This central pool is funded by all of the cities participating in that program through premium assessments.
REMIF purchases excess loss insurance policies (reinsurance) to provide coverage for losses and claims in excess of REMIF’s stated retention limits up to specified amounts. Losses and claims ceded to reinsurers would represent a contingent liability to REMIF if the reinsurers were unable to meet their existing obligations under the reinsurance agreements. Losses and claims which surpass the limits of the excess of loss insurance policies are the responsibility of the individual city in which the loss or claim originates.
The City of Willits participates in the following REMIF programs:
General Liability Insurance – Annual premiums are paid by the member cities and are adjusted retrospectively to cover costs. The City of Willits self-insures for the first $5,000 of each loss and pays 100% of all losses incurred under $5,000. The City does not share or pay for losses of other cities under a range of between $5,000 to $25,000, depending on the entity’s deductible amount.
Participating cities then share in the next $5,000 to $500,000 per loss occurrence. Specific coverage includes comprehensive and general liability, personal injury, contractual liability, professional liability, and certain other coverage. REMIF is a member of the California Joint Powers Risk Management Authority, which provides REMIF with an additional $39,500,000 liability insurance coverage over and above REMIF retention level of $500,000.
Worker’s Compensation – Periodic deposits are paid by member cities and are adjusted retrospectively to cover costs. The City of Willits is self-insured for the first $10,000 of each loss and pays 100% of all losses incurred under $10,000. The City does not share or pay for losses of other cities under $10,000. Excess worker’s compensation insurance coverage is maintained with a limit of $1,000,000 to protect against catastrophic losses.
Property Insurance –The City of Willits maintains the following property insurance coverages:
Automobile – Loss limit: Stated Value. Deductible: $10,000.
Boiler/Machinery – Loss limit: $100 million. Deductible: $5,000.
Cyber Coverage – Loss Limit: $2 million. Deductible: $100,000.
Pollution: - Loss Limit: $2 million. Deductible: $100,000.
Property Loss: Loss Limit: $400 million. Deductible: $10,000 (excludes flood, earthquake, and boiler/machinery.
Earthquake and Flood – Loss Limit: $20 million. Deductible: $100,000.
The June 30, 2023 financial statements for REMIF are available online at www.remif.com.
CITY OF WILLITS
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2023
55 NOTE 17 – COMMITMENTS AND CONTIGENCIES
There are various lawsuits and claims against the City. Although the outcomes of these lawsuits and claims is not presently determinable, management, after consultation with legal counsel is of the opinion will not have an material adverse effect on the financial condition of the City as of June 30, 2022.
56 Page Intentionally Left Blank
REQUIRED SUPPLEMENTAL INFORMATION
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues
Property Taxes $ 496,650 $ 496,650 $ 575,240 $ 78,590
Sales and Use Taxes 3,395,000 3,395,000 3,091,646 (303,354) Business License Taxes 146,500 146,500 138,277 (8,223)
Franchise Fees 317,300 317,300 351,226 33,926
Transient Occupancy Taxes 440,000 440,000 302,219 (137,781) Other Taxes 476,270 476,270 100,838 (375,432)
Licenses and Permits 197,000 197,000 97,999 (99,001)
Interest 30,000 30,000 33,774 3,774
Charges for Services 267,796 267,796 653,683 385,887
Intergovernmental 694,151 694,151 816,571 122,420
Other 352,146 352,146 669,594 317,448
Total Revenues 6,812,813 6,812,813 6,831,067 18,254
Expenditures
Current:
General Government 2,184,974 2,184,974 2,008,717 176,257 Planning 368,309 368,309 295,574 72,735
Public Safety 2,750,438 2,750,438 2,984,449 (234,011)
Public Works 284,381 284,381 224,507 59,874
Parks and Recreation 489,449 489,449 338,603 150,846
Community Development 584,262 584,262 623,302 (39,040)
Total Expenditures 6,661,813 6,661,813 6,475,152 186,661 Excess (Deficiency) of Revenues Over
(Under) Expenditures 151,000 151,000 355,915 204,915
Other Financing Sources (Uses):
Transfers In 41,722 41,722
Transfers Out (151,000) (151,000) 151,000
Total Other Financing Sources (Uses) (151,000) (151,000) 41,722 192,722 Net Change in Fund Balance - - 397,637 397,637
Fund Balance - July 1, 2022 5,206,706 5,206,706 5,206,706 Fund Balance - June 30, 2023 $ 5,206,706 $ 5,206,706 $ 5,604,343 $ 397,637 Budgeted Amounts
CITY OF WILLITS
GENERAL FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
SCHEDULE OF REVENUES, EXPENDITURES,
BUDGET AND ACTUAL
AND CHANGES IN FUND BALANCES
57 Variance with
Final Budget
Original Final Actual Positive (Negative)
Revenues
Sales and Use Taxes $ 1,011,460 $ 1,011,460 $ 882,658 $ (128,802) Interest 46,663 46,663
Intergovernmental 200,000 200,000 100,000 (100,000)
Total Revenues 1,211,460 1,211,460 1,029,321 (182,139)
Expenditures
Current:
Public Works 610,202 610,202 496,508 113,694
Total Expenditures 610,202 610,202 496,508 113,694
Excess (Deficiency) of Revenues Over
(Under) Expenditures 601,258 601,258 532,813 (68,445)
Other Financing Sources (Uses):
Transfers Out (1,900,000) (1,900,000) (1,410,001) 489,999 Total Other Financing Sources (Uses) (1,900,000) (1,900,000) (1,410,001) 489,999 Net Change in Fund Balance (1,298,742) (1,298,742) (877,188) 421,554 Fund Balance - July 1, 2022 3,314,838 3,314,838 3,314,838 Fund Balance - June 30, 2023 $ 2,016,096 $ 2,016,096 $ 2,437,650 $ 421,554
CITY OF WILLITS
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
SALES TAX SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
Budgeted Amounts
58 Variance with
Final Budget
Budget Actual Positive (Negative)
Revenues
Interest - $ (102) $ (102) $
Intergovernmental 239,018 241,221 2,203
Total Revenues 239,018 241,119 2,101
Expenditures
Current:
Public Works 298,831 402,210 (103,379)
Total Expenditures 298,831 402,210 (103,379)
Excess (Deficiency) of Revenues Over
(Under) Expenditures (161,091) (59,813) (101,278)
Net Change in Fund Balance (59,813) (161,091) (101,278) Fund Balance - July 1, 2022 (88,260) (88,260)
Fund Balance - June 30, 2023 (148,073) $ (249,351) $ (101,278) $
CITY OF WILLITS
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
GAS TAX SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
Final
59 CITY OF WILLITS
REQUIRED SUPPLEMENTAL INFORMATION
JUNE 30, 2023
60 Cost Sharing Defined Benefit Pension Plans
Schedule of the City’s Proportionate Share of the Net Pension Liability – Last 10 Years* Misc Plan Safety Plan Misc Plan Safety Plan Misc Plan Safety Plan Misc Plan Safety Plan Proportion of the net pension liability 0.144850% 0.058700% 0.209960% 0.066670% 0.144290% 0.056630% 0.144400% 0.059340% Proportionate share of the net pension liability $ 6,777,718 $ 4,033,289 $ 3,986,796 $ 2,339,777 $ 6,086,133 $ 3,772,924 $ 5,782,463 $ 3,545,788 Covered-employee payroll $ 1,941,809 $ 812,511 $ 1,960,626 $ 725,122 $ 1,995,011 $ 838,234 $ 1,844,079 $ 665,707 Proportionate Share of the net pension liability
as a percentage of covered-employee payroll 349.04% 496.40% 203.34% 322.67% 305.07% 450.10% 313.57% 532.63% Plan's fiduciary net position $ 15,719,519 $ 9,012,511 $ 17,999,030 $ 9,441,255 $ 14,255,123 $ 9,945,145 $ 13,500,184 $ 9,057,376 Plan's total pension liability $ 21,287,905 $ 14,255,133 $ 20,244,424 $ 13,522,533 $ 20,341,256 $ 13,718,069 $ 19,282,647 $ 12,644,758 Plan fiduciary net position as a percentage of
total pension liability 73.84% 63.22% 88.91% 69.82% 70.08% 72.50% 70.01% 71.63% June 30, 2023 June 30, 2022 June 30, 2021 June 30, 2020 Misc Plan Safety Plan Misc Plan Safety Plan Misc Plan Safety Plan Misc Plan Safety Plan Misc Plan Safety Plan Proportion of the net pension liability 0.144900% 0.059010% 0.142270% 0.059340% 0.143320% 0.093130% 0.152275% 0.067911% 0.151177% 0.067559% Proportionate share of the net pension liability 5,461,003 $ $ 3,462,358 $ 5,608,277 $ 3,545,788 $ 4,978,929 $ 4,177,620 3,235,381 $ $ 3,736,327 2,798,221 $ $ 2,534,118 Covered-employee payroll $ 1,798,882 $ 537,809 $ 1,678,686 $ 587,395 $ 1,743,044 $ 747,527 $ 1,612,018 $ 773,076 $ 1,577,211 $ 785,122 Proportionate Share of the net pension liability
as a percentage of covered-employee payroll 303.58% 643.79% 334.09% 603.65% 285.65% 432.81% 259.15% 361.96% 236.89% 322.77% Plan's fiduciary net position $ 9,551,447 19,014,416 $ $ 9,001,638 17,178,465 $ $ 6,687,054 11,065,481 $ 11,402,375 $ 6,825,730 $ 11,269,690 $ 6,833,187 $ Plan's total pension liability $ 13,565,469 27,035,996 $ 22,786,742 $ 12,547,426 $ 16,044,411 $ 9,922,435 $ 15,579,995 $ 9,623,951 $ 15,006,017 $ 9,367,305 $ Plan fiduciary net position as a percentage of
total pension liability 70.33% 70.41% 75.39% 71.74% 68.97% 67.39% 73.19% 70.92% 75.10% 72.95% June 30, 2019 June 30, 2018 June 30, 2017 June 30, 2016 June 30, 2015 Notes to Schedule
Change in Benefit Terms: The figures above do not include any liability impact that may have resulted from plan changes which occurred after June 30, 2013 as they have minimal cost impact. This applies for voluntary benefit changes as well as any offers of Two Years Additional Service Credit (a.k.a Golden Handshakes).
Change in Assumptions: Discount rate has changed to 7.15% in fiscal year 2017.
Discount rate has changed to 6.90% in fiscal year 2023. *Fiscal year 2015 was the 1st year of implementation, therefore only nine years are shown.
CITY OF WILLITS
REQUIRED SUPPLEMENTAL INFORMATION
JUNE 30, 2023
61 Cost Sharing Defined Benefit Pension Plans
Schedule of Contributions – Last 10 Years*
Misc Safety Misc Safety Misc Safety Misc Safety
Plan Plan Plan Plan Plan Plan Plan Plan
Contractual required contribution (actuarially
determined) $ 895,361 $ 371,861 $ 607,211 $ 590,683 $ 541,588 $ 544,157 $ 598,503 $ 414,634 Contributions in relation to the actuarially
determined contributions (895,361) (371,861) (607,211) (590,683) (541,588) (544,157) (598,503) (414,634) Contribution deficiency (excess) $ - -$ $ - -$ $ - $ - $ - $ - Covered employee payroll $ 1,988,424 $ 550,124 $ 2,185,744 $ 500,004 $ 2,089,451 $ 615,479 $ 2,103,326 $ 729,919 Contributions as a percentage of covered
employee payroll 45.03% 67.60% 27.78% 118.14% 25.92% 88.41% 28.46% 56.81% June 30, 2023 June 30, 2022 June 30, 2021 June 30, 2020 Misc Safety Misc Safety Misc Safety Misc Safety Misc Safety Plan Plan Plan Plan Plan Plan Plan Plan Plan Plan
Contractual required contribution (actuarially
determined) $ 513,332 $ 321,412 $ 470,671 $ 338,047 $ 448,765 $ 370,313 $ 331,977 $ 236,700 $ 332,087 $ 285,632 Contributions in relation to the actuarially
determined contributions (513,332) (321,412) (470,671) (338,047) (448,765) (370,313) (331,977) (236,700) (332,087) (285,632) Contribution deficiency (excess) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Covered employee payroll $ 1,844,079 $ 665,707 $ 1,798,882 $ 537,809 $ 1,678,686 587,395$ $ 1,743,044 $ 747,527 $ 1,612,018 $ 773,076 Contributions as a percentage of covered
employee payroll 27.84% 48.28% 26.16% 62.86% 26.73% 63.04% 19.05% 31.66% 20.60% 36.95% June 30, 2019 June 30, 2018 June 30, 2017 June 30, 2016 June 30, 2015 Notes to Schedule
(1)The mortality table was developed based on CalPERS’ specific data. The table includes 20 years of mortality improvements using Society of Actuaries Scale BB. For more details on this table, please refer to the 2014 experience study report.
*Fiscal year 2015 was the 1st year of implementation, therefore only nine years are shown.
Valuation Date: June 30, 2021
Methods and assumptions used to determine contributions rates:
Actuarial Cost Method Entry Age Normal Cost Method
Amortization Method Level Percent of Payroll
Asset Valuation Method Market Value
Inflation 2.30%
Salary Increase 3.30% to 14.2 %
Investment Rate of Return 6.90%
Mortality Rate Table(1) Derived using CalPERS Data
OTHER SUPPLEMENTAL INFORMATION
Variance with
Final Budget
Budget Actual Positive (Negative)
Revenues
Interest $ - $ 335 $ 335
Intergovernmental 327,827 327,827
Total Revenues 328,162 328,162
Expenditures
Current:
General Government 7,500 (7,500)
Public Works 80,255 (80,255)
Capital Outlay 1,301,000 1,991,381 (690,381)
Total Expenditures 1,301,000 2,079,136 (778,136)
Excess (Deficiency) of Revenues Over
(Under) Expenditures (1,301,000) (1,750,974) (449,974)
Other Financing Sources (uses):
Transfers In 1,398,649 1,398,649
Total Other Financing Sources (Uses) 1,398,649 1,398,649 Net Change in Fund Balance (1,301,000) (352,325) 948,675 Fund Balance - July 1, 2022 531,245 531,245
Fund Balance - June 30, 2023 $ (769,755) $ 178,920 $ 948,675 FOR THE FISCAL YEAR ENDED JUNE 30, 2023
Final
CITY OF WILLITS
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
CAPITAL OUTLAY CAPITAL PROJECTS FUND
62 63
NONMAJOR GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS
______________________________
Special revenue funds are used to account for specific revenues that are legally restricted to expenditure for particular purposes.
______________________________
Haehl Creek Fund was established to account for the development of improvements at the intersections of Baechtel Road with South Main Street or along the Haehl Creek Drive, East Hill Road, or Baechtel Road corridors.
LEAA Fund was established to account for revenue and expenditures associated with the Law Enforcement Assistance Administration Program.
Narcotics Forfeiture Fund was established to account for funds distributed to the Willits Police Department in accordance with law as a result of a local or state narcotics forfeiture and/or seizure. As required by law these funds will be utilized exclusively to support the law enforcement and prosecutor efforts of the Willits Police Department.
Business Rehab Fund was established to account for funds set aside for the business rehabilitation program loans and to account for revenues and expenditures associated with repayment and disbursement of loans.
Vehicle Abatement Fund was established to account for funds received as part of the CHP abandoned vehicle abatement program.
HSG Rehab Fund was established to account the CDBG Housing Rehabilitation program loans.
DNA Cost Reimb Fund was established to account for funds distributed to the Willits Police Department in accordance with California State laws for funds from the State Department of Justice.
H&S Restitution Fund was established to account for funds distributed to the Willits Police Department by offenders whose actions have caused resources to be expended to remediate their operations/locations, according to the District Attorney’s 11470.2 H&S Restitution Fund.
Business Loan Fund was established to account for local small business loans and to account for revenues and expenditures associated with repayment and disbursement of loans.
Traffic Safety Fund was established to account for funds received and utilized for traffic safety.
HSB Rehab Revolving Fund was established to account the CDBG Housing Rehabilitation loans and to account for revenues and expenditures associated with repayment and disbursement of loans.
Lateral Repair Loan Fund was established to account for loans given by the City for residents to make necessary repairs to sewer lateral improvement and repairs.
Gas Tax Fund was established to account for revenue and expenditures associated with the gasoline tax.
LEAA Narcotics Business Vehicle
Haehl Creek Program Forfeiture Rehab Abatement HSG Rehab Assets
Cash and Investments $ 130,090 $ 19,967 $ 60,117 $ 4,037 $ - $ - Accounts Receivable
Loans Receivable 225,481
Total Assets $ 130,090 $ 19,967 $ 60,117 $ 4,037 $ 225,481 - $ Liabilities
Accounts Payable $ - $ 748 $ 578 $ - $ - $ -
Deposits Payable 4,066
Due to other Funds 5,256 2,639
Total Liabilities 748 4,644 5,256 2,639
Fund Balances
Restricted 130,090 19,219 55,473 4,037 222,842
Unassigned (5,256)
Total Fund Balances 130,090 19,219 55,473 4,037 (5,256) 222,842 Total Liabilities and Fund Balances 130,090 $ $ 19,967 $ 60,117 $ 4,037 $ 225,481 - $ Special Revenue Funds
CITY OF WILLITS
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
June 30, 20223
64 Total
Nonmajor
DNA Cost H&S Business Traffic Lateral Governmental
Reimb Restitution Loan Safety Repair Loan Gas Tax Funds $ 45,253 $ 36,257 $ 13,478 - $ $ 35,037 $ 344,236
4,180 76,612 80,792
225,481
$ 45,253 $ 36,257 $ 17,658 - $ $ 35,037 $ 76,612 $ 650,509 $ - $ - $ - $ 440 $ - $ 16,720 $ 18,486
4,066
309,243 317,138
440 325,963 339,690
45,253 36,257 17,218 35,037 565,426
(249,351) (254,607)
45,253 36,257 17,218 35,037 (249,351) 310,819
$ 45,253 $ 36,257 $ 17,658 - $ $ 35,037 $ 76,612 $ 650,509
CITY OF WILLITS
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
June 30, 2023
Special Revenue Funds
65 LEAA Narcotics Business Vehicle
Haehl Creek Program Forfeiture Rehab Abatement HSG Rehab Revenues:
Sales and Use Taxes $ - $ - $ - $ - $ - $ -
Interest 55 3,289 10 17
Charges for Services
Intergovernmental 187,236
Total Revenues 187,291 3,289 10 17
Expenditures:
Current:
Community Development
Public Safety 22,277 14,558 6,576
Public Works
Total Expenditures 22,277 14,558 6,576
Excess (Deficiency) of Revenues
over (Under) Expenditures 187,291 (22,277) (11,269) (6,566) 17 Other Financing Sources (Uses):
Transfers Out
Total Other Financing
Sources (Uses)
Net Change in Fund Balances 187,291 (22,277) (11,269) (6,566) 17 Fund Balances - June 30, 2022 (57,201) 41,496 66,742 4,037 1,310 222,825 Fund Balances - June 30, 2023 $ 130,090 $ 19,219 $ 55,473 $ 4,037 $ (5,256) $ 222,842 Special Revenue Funds
CITY OF WILLITS
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
For the Fiscal Year Ended June 30, 2023
66 Total
Nonmajor
DNA Cost H&S Business Traffic Lateral Governmental
Reimb Restitution Loan Safety Repair Loan Gas Tax Funds $ - $ - $ - $ - $ - $ - $ -
2 640 (102) 3,911
3,521 6,254 9,775
72,805 4,168 241,221 505,430
3,523 640 72,805 241,119 10,422 519,116
470,000 470,000
2,823 19,247 65,481
402,210 402,210
2,823 470,000 402,210 19,247 937,691
3,523 (2,183) (397,195) (161,091) (8,825) (418,575)
(4,517) (4,517)
(4,517) (4,517)
3,523 (2,183) (401,712) (161,091) (8,825) (423,092)
41,730 38,440 401,712 26,043 35,037 (88,260) 733,911
$ 45,253 $ 36,257 $ 17,218 - $ $ 35,037 $ (249,351) $ 310,819
CITY OF WILLITS
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
For the Fiscal Year Ended June 30, 2023
Special Revenue Funds
67 68
Page Intentionally Left Blank
Variance with
Final Budget
Budget Actual Positive (Negative)
Revenues
Miscellaneous Revenues 5,604 - (5,604)
Total Revenues 5,604 (5,604)
Expenditures
Current:
Public Safety $ 5,604 $ 22,277 $ (16,673)
Total Expenditures 5,604 22,277 (16,673)
Excess (Deficiency) of Revenues Over
(Under) Expenditures (22,277) (22,277)
Net Change in Fund Balance - (22,277) (22,277)
Fund Balance - July 1, 2022 41,496 41,496
Fund Balance - June 30, 2023 $ 41,496 $ 19,219 $ (22,277)
CITY OF WILLITS
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
LEAA PROGRAM SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
Final
69 Variance with
Final Budget
Budget Actual Positive (Negative)
Revenues
Interest $ 500 $ 3,289 $ 2,789
Intergovernmental 35,000 (35,000)
Total Revenues 35,500 3,289 (32,211)
Expenditures
Current:
Public Safety 35,000 14,558 20,442
Total Expenditures 35,000 14,558 20,442
Excess (Deficiency) of Revenues Over
(Under) Expenditures 500 (11,269) (11,769)
Net Change in Fund Balance 500 (11,269) (11,769)
Fund Balance - July 1, 2022 66,742 66,742
Fund Balance - June 30, 2023 $ 67,242 $ 55,473 $ (11,769)
SCHEDULE OF REVENUES, EXPENDITURES,
CITY OF WILLITS
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
NARCOTICS FORFEITURE SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
Final
70 Variance with
Final Budget
Budget Actual Positive (Negative)
Revenues
Interest $ 500 $ 640 $ 140
Total Revenues 640 140
Expenditures
Current:
Public Safety 10,000 2,823 7,177
Total Expenditures 10,000 2,823 7,177
Excess (Deficiency) of Revenues Over
(Under) Expenditures (10,000) (2,183) 7,817
Net Change in Fund Balance (10,000) (2,183) 7,817
Fund Balance - July 1, 2022 38,440 38,440
Fund Balance - June 30, 2023 $ 28,440 $ 36,257 $ 7,817
Final
CITY OF WILLITS
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
H&S RESTITUTION SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
71 Variance with
Final Budget
Budget Actual Positive (Negative)
Revenues
Charges for Services $ - $ 6,254 $ 6,254
Intergovernmental 4,168 4,168
Total Revenues 10,422 10,422
Expenditures
Current:
Public Safety 15,389 19,247 (3,858)
Total Expenditures 15,389 19,247 (3,858)
Excess (Deficiency) of Revenues Over
(Under) Expenditures (15,389) (8,825) 6,564
Net Change in Fund Balance (15,389) (8,825) 6,564
Fund Balance - July 1, 2022 26,043 26,043
Fund Balance - June 30, 2023 $ 10,654 $ 17,218 $ 6,564
BUDGET AND ACTUAL
TRAFFIC SAFETY SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
Final
CITY OF WILLITS
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
72 73
NONMAJOR PROPRIETARY FUNDS
PROPRIETARY FUNDS
______________________________
Proprietary funds are used to account for operations that are financed and operated in a manner similar to private business enterprises - for these funds, it is the intent of the City Council that the costs of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges.
______________________________
Solid Waste - This fund is used to account for revenues and expenses associated with solid waste services.
Airport - This fund is used to account for revenues and expenses associated with the Airport.
Total
Nonmajor
Solid Waste Airport
Fund Fund
Assets
Current Assets:
Cash and Investments $ - $ - $ -
Accounts Receivable 29,499 29,499
Inventory 169,422 169,422
Total Current Assets 198,921 198,921
Noncurrent Assets:
Capital Assets:
Land 11,692 11,692
Buildings and Improvements 1,707,978 1,707,978
Machinery and Equipment 54,867 54,867
Construction in Progress 50,064 50,064
Less:
Accumulated Depreciation (675,197) (675,197)
Total Noncurrent Assets 1,149,404 1,149,404
Total Assets 1,348,325 1,348,325
Liabilities
Current Liabilities:
Accounts Payable 11,259 46,264 57,523
Due to Other Funds 688,078 278,931 967,009
Deposits Payable 8,669 8,669
Total Current Liabilities 699,337 333,864 1,033,201
Noncurrent Liabilities:
Landfill Post-closure Costs 881,592 881,592
Total Noncurrent Liabilities 881,592 881,592
Total Liabilities 1,580,929 333,864 1,914,793
Net Position
Net Investment in Capital Assets 1,149,404 1,149,404
Unrestricted (1,580,929) (134,943) (1,715,872)
Total Net Position $ (1,580,929) $ 1,014,461 $ (566,468)
CITY OF WILLITS
NONMAJOR PROPRIETARY FUNDS
COMBINING STATEMENT OF NET POSITION
June 30, 2023
Enterprise Funds
Enterprise
Funds
74 Total
Nonmajor
Solid Waste Airport
Fund Fund
Operating Revenues
Charges for Services $ - $ 95,484 $ 95,484
Other 22,208 22,208
Total Operating Revenues 117,692 117,692
Operating Expenses
Operations 141,063 141,063
Administrative 27,405 27,405
Maintenance 155,986 9,101 165,087
Depreciation 93,975 93,975
Total Operating Expenses 155,986 271,544 427,530
Operating Income (Loss) (155,986) (153,852) (309,838)
Non-Operating Revenue (Expenses)
Interest Revenue (64) (64)
Total Non-Operating Revenue (Expenses) (64) (64)
Income (Loss) Before Transfers (155,986) (153,916) (309,902) Changes in Net Position (155,986) (153,916) (309,902)
Net Position - Beginning of Fiscal Year (1,424,943) 1,168,377 (256,566) Net Position - End of Fiscal Year $ (1,580,929) $ 1,014,461 $ (566,468) Enterprise
NONMAJOR PROPRIETARY FUNDS
COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION FOR THE FISCAL YEAR ENDED JUNE 30, 2023
Funds
Enterprise Funds
CITY OF WILLITS
75 Total
Nonmajor
Solid Waste Airport
Fund Fund
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash Received from Users $ - $ 89,956 $ 89,956
Cash Payments to Suppliers and Contractors (155,772) (176,977) (332,749) Net Cash Provided (Used) By Operating Activities (155,772) (87,021) (242,793) CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Interfund Borrowing 155,772 193,640 349,412
Net Cash Provided (Used) By Noncapital Financing Activities 155,772 193,640 349,412 CASH FLOWS FROM INVESTING ACTIVITIES:
Interest Received (64) (64)
Net Cash Provided (Used) in Investing Activities (64) (64)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING
ACTIVITIES:
Acquisition of property, plant, and equipment (106,555) (106,555) Net Cash Provided (Used) In Capital and Related
Financing Activities (106,555) (106,555)
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS
CASH AND CASH EQUIVALENTS, BEGINNING OF FISCAL YEAR - - CASH AND CASH EQUIVALENTS, END OF FISCAL YEAR $ - $ - $ - Reconciliation to Statement of Net Position:
Cash and Cash Equivalents $ - $ - $ -
CASH FLOWS FROM OPERATING ACTIVITIES:
Operating Income (Loss) $ (155,986) $ (153,852) $ (309,838) Adjustment to Reconcile Operating Income
(Loss) to Net Cash Provided (Used) by Operating
Activities:
Depreciation Expense 93,975 93,975
Changes in Assets and Liabilities:
Increase (Decrease) in Accounts Payable 214 35,170 35,384 (Increase) Decrease in Inventory (34,578) (34,578)
Total Adjustments 214 66,831 67,045
Net Cash Provided (Used) By Operating Activities $ (155,772) $ (87,021) $ (242,793)
CITY OF WILLITS
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
Funds
NONMAJOR PROPRIETARY FUNDS
COMBINING STATEMENT OF CASH FLOWS
Enterprise Funds
Enterprise
76 Item No. 9b
Meeting Date: April 23, 2025
AGENDA SUMMARY REPORT
To: Honorable Mayor and Council Members
From: Walter Kolon, Services and Facilities Director
Agenda Title: RESOLUTION APPROVING THE PURCHASE OF A CATERPILLAR 416 BACKHOE WITH LOADER IN AN AMOUNT NOT TO EXCEED $172,128.25.
Type: Presentation Consent Regular Agenda Public Hearing Urgent Time:
Summary of Request: Purchase of a Caterpillar 416 07A Backhoe Loader to replace an aging 2002 Caterpillar Backhoe Loader to be used by the Wastewater Treatment Plant, Water Treatment Plant and Streets and Roads Dept.
The backhoe is used heavily by City Crews for a variety of projects and tasks and is considered a vital piece of equipment for City Public Works operations. The new Backhoe will be compliant with current diesel emission requirements.
Recommended Action: Approve a Resolution to purchase a Caterpillar Backhoe with Loader in an amount not to exceed $172,128.25.
Alternative(s): Age and condition warrant replacement.
Fiscal Impact: Caterpillar Backhoe Loader $172,128.25. Reflects savings through Sourcewell Government Pricing.
This unit is split between the following departments and Funds. Although allocated in the 2024-2025 Budget funds will need to be distributed through a Budget Amendment.:
• Sewer Enterprise Capital Projects Fund 410-40% share $68,851.13 • Water Enterprise Capital Improvements Fund 430-40% share $68,851.13 • City Infrastructure Capital Projects Fund 400 Streets - 20% share $34,426 Personnel Impact: None.
Identified City Council Conflict of Interest: None.
2021 Adopted Goals: This item meets Goal #1 for Services & Facilities…Maintain and improve infrastructure systems of water, wastewater, public facilities, and streets capable of managing future growth while responding to current City needs.
California Environmental Quality Act: New tractor will be compliant with current environmental guidelines This Item Relates to the following General Plan Element : N/A Land Use Circulation Conservation and Open Space Noise Housing Public Services and Facilities, Parks and Recreation Economic Development
Reviewed by: City Manager City Attorney Assistant City Manager City Clerk Finance Director Human Resources
Council Action: Approved Denied Other: ________________________________________ Records: Agreement Resolution #_________ Ordinance #_________ Other _________ Resolution No. 2025-__ Page 1 of 1 April 23, 2025
RESOLUTION NO. 2025-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WILLITS TO APPROVE THE
PURCHASE A CATERPILLER BACKHOE LOADER IN AN AMOUNT NOT TO EXCEED $172,128.25.
WHEREAS, Due to age and diesel compliance regulations the 2002 Caterpillar Backhoe w/loader has been in service for many years with the City of Willits; and WHEREAS, staff received proposals through the Sourcewell Government Discount Program; and
WHEREAS, Peterson Cat of Ukiah submitted an acceptable price and unit, See Exhibit A; and
WHEREAS, Peterson Caterpillar price of $172,128.25 will be shared in a 40% / $40% / 20% split between Water Enterprise Fund, Wastewater Enterprise Fund, and Streets and Road Fund respectively; and
NOW, THEREFORE, BE IT RESOLVED that the Willits City Council does hereby authorize the Finance Director to increase appropriations in the Water Enterprise Fund # 530 for the total amount of $68,851.13; Wastewater Enterprise Fund # 510 for the total amount of $68,851.13 and Streets and Road Fund # 245 for the total amount of $34,426 and approve the purchase of a Caterpillar 416 07A Backhoe with Loader.
The above and foregoing Resolution was introduced by Councilmember seconded by Councilmember , and passed and adopted at a regular meeting of the City Council of the City of Willits, held on the 23rd day of April, 2025, by the following vote:
AYES:
NOES:
ABSENT:
ATTEST:
__________________________
_________________________________
Mayor
City Council of the City of Willits
DELORES PEDERSEN, City Clerk
EXHIBIT B
P.O. #
Scott Herman
VENDOR: Peterson / Caterpillar
1471 S Main Street
Willits CA 95490
707.459.9006
Line
No. Quantity Unit Price Extension
1 1 $ 187,471.50 $ 187,471.50
2 1 $ (41,243.73) $ (41,243.73)
3 1 $ 1,910.00 $ 1,910.00
4 1 $ 9,597.17 $ 9,597.17
$ -
5 $ -
Charge To: Fund 410.4991.76000 40% Tax $14,393.31
Department 430.4993.76000 40% Shipping $0.00
Object/subject 400.4990.76000 20%
Total $ 172,128.25
CITY OF WILLITS
PURCHASE ORDER REQUEST
Requested By:
Description
416 07A BACKHOE LOADER CFG2 543-3339
TRIM PACKAGE 3 643-4080
ENGINE, 55KW, C3.6 DITA, T4F 542-7778
SEAT BELT, 3'' SUSPENSION 206-1748
AIR CONDITIONER, T4F 542-7808
PRODUCT LINK, CELLULAR, PLE643 639-4880
TIRES, 340 80R18/500 70R24, MX 533-0479
STABILIZER PADS, FLIP-OVER 9R-6007
BUCKET-MP, 1.3 YD3, PO 337-7436
CUTTING EDGE, TWO PIECE 9R-5321
COUPLER, PG, HYDR.D.LOCK, BHL 485-5303
INSTRUCTIONS, ANSI 559-0872
SERIALIZED TECHNICAL MEDIA KIT 421-8926
RIDE CONTROL 551-6453
COUPLING,QD,THREADED WITH CAPS 456-3390
THUMB, HYDRAULIC, NO TINE, BHL 282-5409
THUMB, TINE, A 4 221-4285
LINES, COMBINED AUX, E-STICK 548-1231
STANDARD RADIO (12V) 540-2298
GUARD, STABILIZER 353-1389
LINES,HYD CPLR 14FT EXT PILOT 555-2396
WACO DEALER PDI & FUEL 621-7419
SOURCEWELL DISCOUNT 22% CONTRACT# 032119-CAT
84 MO/3000 HR POWERTRAIN+HYDRAULICS+TEC WARRANTY
PDI, DELIVERY AND LOOSE ATTACHMENTS
REFERENCE QUOTE # 230563-02
Department Head Approval ( 0-$1500) __________________________________________ Date: 2/26/2025 City Manager Approval ____________________________________________________ Date:
Finance Officer:____________________________________________________________ Date:
Reason for request/Justification: Replace 2002 420D Caterpillar Backhoe Sep 19, 2024
CITY OF WILLITS
111 E COMMERCIAL ST
WILLITS
California
95490
RE: Quote 230563-02
Dear Sir,
We would like to thank you for your interest in our company and our products, and are pleased to quote the following for your consideration.
One (1) New Caterpillar Model: 416 Backhoe Loaders
MACHINE SPECIFICATIONS
416 07A BACKHOE LOADER CFG2 543-3339
HRC - MACHINE
LANE 2 - AVAILABLE FROM CLAYTON AND WACO DISTRIBUTION CENTERS (SAP)
LANE 3 - AVAILABLE FROM CLAYTON AND WACO DISTRIBUTION CENTERS (SAP)
TRIM PACKAGE 3 643-4080
ENGINE, 55KW, C3.6 DITA, T4F 542-7778
SEAT BELT, 3'' SUSPENSION 206-1748
AIR CONDITIONER, T4F 542-7808
PRODUCT LINK, CELLULAR, PLE643 639-4880
TIRES, 340 80R18/500 70R24, MX 533-0479
STABILIZER PADS, FLIP-OVER 9R-6007
BUCKET-MP, 1.3 YD3, PO 337-7436
CUTTING EDGE, TWO PIECE 9R-5321
COUPLER, PG, HYDR.D.LOCK, BHL 485-5303
INSTRUCTIONS, ANSI 559-0872
SERIALIZED TECHNICAL MEDIA KIT 421-8926
RIDE CONTROL 551-6453
COUPLING,QD,THREADED WITH CAPS 456-3390
THUMB, HYDRAULIC, NO TINE, BHL 282-5409
THUMB, TINE, A 4 221-4285
LINES, COMBINED AUX, E-STICK 548-1231
STANDARD RADIO (12V) 540-2298
GUARD, STABILIZER 353-1389
LINES,HYD CPLR 14FT EXT PILOT 555-2396
EXHIBIT A
41607a
WACO DEALER PDI & FUEL 621-7419
SELL PRICE $187,471.50
SOURCEWELL DISCOUNT 22% OF LIST CONTRACT# 032119-CAT ($41,243.73) 84 MO/3000 HR POWERTRAIN + HYDRAULICS + TEC WARRANTY $1,910.00 NET BALANCE DUE $157,734.94
PDI, DELIVERY AND LOOSE ATTACHEMNTS $9,597.17
MENDOCINO CO. TAX (CITY OF WILLITS) (9.125%) $14,393.31 AFTER TAX BALANCE $172,128.25
WARRANTY
Standard Warranty: 12 Month, Unlimited Hours Standard Warranty F.O.B/TERMS: Willits
Accepted by___________________________________ on ____________________ ______________________________
Signature
This Quote is valid for 30 days, after which time we reserve the right to re-quote. If there are any questions, please do not hesitate to contact me.
Sincerely,
Jack Drew
Machine Sales Representative
Peterson CAT
+1 707-489-3664
[email protected]
Item No. 9c
Meeting Date: April 23, 2025
AGENDA SUMMARY REPORT
To: Honorable Mayor and Council Members
From: Walter Kolon, Services and Facilities Director
Agenda Title: RESOLUTION APPROVING THE PURCHASE OF A KUBOTA TRACTOR AND MOWER FOR THE WASTEWATER TREATMENT PLANT IN AN AMOUNT NOT TO EXCEED $163,301.94.
Type: Presentation Consent Regular Agenda Public Hearing Urgent Summary of Request: Purchase of a Kubota M6-141DTC 4WD Tractor and mower to replace an ageing 1990 Heston Tractor and Mower unit to be used by the Wastewater Treatment Plant.
The existing tractor/ mower is past its useful working lifespan and needs to be repaired often. Due to age, parts are becoming more difficult to locate. The new tractor will be compliant with current diesel emission requirements.
Recommended Action: Approve a Resolution to purchase a Kubota Tractor and Mower in an amount not to exceed $163,301.94.
Alternative(s): Daily use, down time and repairs are becoming Cost Prohibitive.
Fiscal Impact: Kubota Tractor w/ mower $163,301.94 from the Sewer Capitol Projects Fund-410 and budgeted under Project SWR2492-00. Funding will come from fund balance within the Sewer Enterprise Fund # 510 and reflects savings through Sourcewell Government Pricing. Reduced annual maintenance costs.
Personnel Impact: None.
Identified City Council Conflict of Interest: None.
2021 Adopted Goals: This item meets Goal #1 for Services & Facilities…Maintain and improve infrastructure systems of water, wastewater, public facilities, and streets capable of managing future growth while responding to current City needs.
California Environmental Quality Act: New tractor will be compliant with current environmental guidelines This Item Relates to the following General Plan Element : N/A Land Use Circulation Conservation and Open Space Noise Housing Public Services and Facilities, Parks and Recreation Economic Development
Reviewed by: City Manager City Attorney Assistant City Manager City Clerk Finance Director Human Resources
Council Action: Approved Denied Other: ________________________________________ Records: Agreement Resolution #_________ Ordinance #_________ Other _________ Resolution No. 2025-__ Page 1 of 1 April 23, 2025
RESOLUTION NO. 2025-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WILLITS TO PURCHASE A KUBOTA TRACTOR AND MOWER IN AN AMOUNT NOT TO EXCEED $163,301.94.
WHEREAS, the 1990 Heston Tractor and mower has served the City of Willis for many decades; and
WHEREAS, Repairs, downtime, diesel compliance and parts availability for the Heston tractor are affecting Wastewater operations; and
WHEREAS, proposals were received by vendors with Garton Tractor of Ukiah submitting an acceptable price for a suitable tractor and mower. See Exhibit A.
WHEREAS, Garton Tractors price of $163,301.94 was budgeted in the 2024/2025 Budget and will be paid from Sewer Capitol Project Fund 410; and WHEREAS, the Finance Director will ensure funds are transferred into the appropriate Fund; and
NOW, THEREFORE, BE IT RESOLVED that the Willits City Council does hereby authorizes the Finance Director to increase appropriations in Fund # 410 and its funding in Fund # 510 to a total of $163,301.94 for the purpose of purchasing the Kubota M6-141-DTC Tractor and Mower for use by the Wastewater Treatment Plant.
The above and foregoing Resolution was introduced by Councilmember seconded by Councilmember , and passed and adopted at a regular meeting of the City Council of the City of Willits, held on the 23rd day of April, 2025, by the following vote:
AYES:
NOES:
ABSENT:
ATTEST:
__________________________
_________________________________
Mayor
City Council of the City of Willits
DELORES PEDERSEN, City Clerk
EXHIBIT B
P.O. #
S. Herman
VENDOR: Garton Tractor, Inc.
285 Talmage Road
Ukiah CA 95482
707.468.5880
Line
No. Quantity Unit Price Extension
1 1 $ 110,044.26 $ 110,044.26
2 1 $ 39,596.00 $ 39,596.00
3 4 $ 1.75 $ 7.00
REFERENCE QUOTE # Q02828
Description
Stock#: 017191 Serial#: KBUMHEPCKR1F31009
New KU M6-141DTC-FNew
KUBOTA M6-141DTC-F- 4wd CAB Tractor
Kubota 141.4 HP V6108-TI Tier 4 final engine CRS,
DPF, SCR constant RPM management system,
114 PTO HP 540/1000 RPM with electro-Hyd
Engagement
20.4 GPM remote hydraulic flow, CAT II 3-point
hitch with adjustable links, Intelli-Shift 24x24
transmission, 8 speed powershift transmission
dual remote valves,
50.2 gallon fuel tank
****INCLUDES THE FOLLOWING****
M6-141DTC-F-1 4wd CAB Tractor
AMR8517 F-TIRE 14.9R24 RlW MICHELIN AGRIBIB
AMR8581 R-TIRE 18.4R38 RlW MICHELIN AGRIBIB CAST
DCU6700 AT&T Telematics Modem
M1352 Rears Work Lights (2)
M6712 M Series Telematics Harness
M6913 Heavy Duty Metal Fuel Tank Guard
M6914 FRONT WEIGHT BRACKET
M6915A BOLT BAR KIT FOR M6914 BRACKET
M7629 3RD POSITION LVR KIT F/M7683A OR M7684A
M7683A SCD VALVE W/BUILT IN FLOW CONTROL
M8079 (16 ) 16 Front Suitcase Weights
M9121A Instructor Seat Kit
M9122 3 PT LIFT ASSIST KIT
M9217 Drawbar Clevis for Drop Drawbar
M9227 Drop Drawbar
M9229 Front Work Lights (2)
16 Foot Standard Duty 3-Point Hitch Boom Mower
CALIFORNIA TIRE FEE
CITY OF WILLITS
PURCHASE ORDER REQUEST
Requested By:
Charge T Fund 410-4991-76000 Tax $13,654.68
Department Wastewater Shipping $0.00
Object/subject New Tractor/Mower
Total $ 163,301.94
Department Head Approval ( 0-$1500) ___________________________________ Date: 2/24/20205 City Manager Approval _______________________________________________ Date:
Finance Officer:_____________________________________________________ Date:
Reason for request/Justification: New Tractor/Mower to replace Heston Tractor and Ferry Mower
EXHIBIT A
Item No. 9d
Meeting Date: April 23, 2025
AGENDA SUMMARY REPORT
To: Honorable Mayor and Council Members
From: Connor Stack, City Planner
Agenda Title: DISCUSSION AND POSSIBLE ACTION REQUESTING A PUBLIC CONVENIENCE AND NECESSITY (PCN) DETERMINATION FOR A TYPE 20 LICENSE FOR BEER AND WINE FOR THE UPCOMING JALOS MARKET LOCATED AT 1569 SOUTH MAIN STREET.
Type: Presentation Consent Regular Agenda Public Hearing Urgent Summary of Request: The upcoming Jalos Market has requested support in obtaining an ABC Type 20 license for the sale of beer and wine at their establishment. While the Department of Alcohol Beverage Control (ABC) has indicated that our city does not currently exceed the Type 20 licenses limit, they require a letter of support from the city council. Jalos Market intends to offer a full range of beer and wine products, sold individually, in six-packs, and in full cases. They believe this will be a significant convenience for their customers, providing a one-stop shop for barbecue supplies and beverages.
The Department of Alcohol and Beverage Control has requested Jalos Market obtain this determination because the County of Mendocino is oversaturated in terms of Type 20 licenses, but our local census track in Willits is not. If Willits as a census track was oversaturated, the license would not be allowed at all by ABC.
Background: Notwithstanding Section 23958, BPC, the Alcohol and Beverage Control (ABC) Department may issue a license as follows:
1. With respect to a non-retail license, a retail on-sale bona fide eating place license, a retail license issued for a hotel, motel, or other lodging establishment, as defined in subdivision (b) of Section 25503.16, a retail license issued in conjunction with a beer manufacturer's license, or a winegrower's license, if the applicant shows public convenience or necessity would be served by the issuance.
2. With respect to any other license, if the local governing body .i.e., city council or county board of supervisors, the area in which the applicant premises are located determines public convenience or necessity would be served by the issuance.
For ABC to approve this application, the City must find that a "Public Convenience or Necessity" would be served by issuing this license and submitting a letter to ABC stating such. The Agenda Summary includes a draft Public Convenience Approval Letter. (Attachment A)
Attachments: The following documents are attached for clarity. -Attachment A: Public Convenience Approval Letter draft. -Attachment B: Letter from Jalos Market requesting support from the City of Willits.
Recommended Action: Find that a “Public Convenience or Necessity” would be served by the issuance of the requested license and direct staff to submit a letter of “Public Convenience or Necessity” to ABC on behalf of the Council.
Alternative(s): Find that a “Public Convenience or Necessity” would NOT be served by the issuance of the requested license and direct staff to notify ABC of the City Council's decision.
Fiscal Impact: The City may potentially receive additional revenue through business taxes from the increased sales of the upcoming business Jalos Market through their ability to serve beer and wine.
Personnel Impact: None.
Identified City Council Conflict of Interest: None.
2021 Adopted Goals: N/A
California Environmental Quality Act: N/A
This Item Relates to the following General Plan Element : N/A Land Use Circulation Conservation and Open Space Noise Housing Public Services and Facilities, Parks and Recreation Economic Development
Reviewed by: City Manager City Attorney Assistant City Manager City Clerk Finance Director Human Resources
Council Action: Approved Denied Other: ________________________________________ Records: Agreement Resolution #_________ Ordinance #_________ Other _________ April 23, 2025
Alcohol Beverage Control Licensing Representative II Tracy Neilson 50 D Street, Suite 130 Santa Rosa, CA 95404
Re: Off-Sale Beer & Wine License
Dear Tracy Neilson (or To Whom It May Concern):
At the Willits City Council meeting of April 23rd, 2025, the Council considered the request by the Jalos Market to be issued a Type-20 Off-Sale Beer & Wine License at their business, located at 1569 South Main Street, Willits, CA 95490. At that meeting it was determined by the City Council that public convenience would be served by allowing Jalos Market to be issued said license.
Sincerely,
Mayor, City of Willits
Gateway to the Redwoods
CITY OF WILLITS
111 E COMMERCIAL STREET, WILLITS CA 95490 • PHONE: (707) 459-7112 • FAX: (707) 459-1562
COMMUNITY DEVELOPMENT DEPARTMENT
To: City Council,
My name is Ma Elisavet Fierro, owner of Jalos Market. I am writing to formally request your support in obtaining an ABC Type 20 license for the sale of beer and wine at our establishment.
While the Department of Alcohol Beverage Control (ABC) has indicated that our city does not currently exceed the limit for Type 20 licenses, they require a letter of support from the city council. Jalos Market intends to offer a full range of beer and wine products, sold individually, in six-packs, and in full cases. We believe this will be a significant convenience for our customers, providing a one-stop shop for barbecue supplies and beverages.
The enthusiastic community response to the opening of Jalos Market has been incredibly encouraging. We are confident that the addition of beer and wine sales will further enhance our contribution to the local community and meet a clear consumer demand.
Therefore, I respectfully request your favorable recommendation to the ABC for the issuance of our Type 20 license. Thank you for your time and consideration. Please feel free to contact me should you require any further information.
Sincerely,
Ma Elisavet Fierro
Owner, Jalos Market
Item No. 9e
Meeting Date: April 23, 2025
AGENDA SUMMARY REPORT
To: Honorable Mayor and Council Members
From: Connor Stack, City Planner
Agenda Title: DISCUSSION AND POSSIBLE ACTION REQUESTING A PUBLIC CONVENIENCE AND NECESSITY (PCN) DETERMINATION FOR A TYPE 20 LICENSE FOR BEER AND WINE FOR THE UPCOMING WILLITS DISCOUNT MARKET AT 851 SOUTH MAIN STREET..
Type: Presentation Consent Regular Agenda Public Hearing Urgent Summary of Request: The upcoming Willits Discount Market, located at 851 South Main Street has requested support in obtaining an ABC Type 20 license for the sale of beer and wine at their establishment. They will operate as a discount market and convenience store offering soft drinks, candy, ice, lotto, snacks, and local Mendocino beer and wine.
The Department of Alcohol and Beverage Control has requested Willits Discount Market obtain this determination because the County of Mendocino is oversaturated in terms of Type 20 licenses, but our local census track in Willits is not. If Willits as a census track was oversaturated, the license would not be allowed at all by ABC.
Notwithstanding Section 23958, BPC, the Alcohol and Beverage Control (ABC) Department may issue a license as follows:
1. With respect to a non-retail license, a retail on-sale bona fide eating place license, a retail license issued for a hotel, motel, or other lodging establishment, as defined in subdivision (b) of Section 25503.16, a retail license issued in conjunction with a beer manufacturer's license, or a winegrower's license, if the applicant shows public convenience or necessity would be served by the issuance.
2. With respect to any other license, if the local governing body .i.e., city council or county board of supervisors, the area in which the applicant premises are located determines public convenience or necessity would be served by the issuance.
For ABC to approve this application, the City must find that a "Public Convenience or Necessity" would be served by issuing this license and submitting a letter to ABC stating such. The Agenda Summary includes a draft Public Convenience Approval Letter. (Attachment A)
Attachments: The following documents are attached for clarity. -Attachment A: Public Convenience Approval Letter draft. -Attachment B: Letter from Willits Discount Market requesting support from the City of Willits.
Recommended Action: Find that a “Public Convenience or Necessity” would be served by the issuance of the requested license and direct staff to submit a letter of “Public Convenience or Necessity” to ABC on behalf of the Council.
Alternative(s): Find that a “Public Convenience or Necessity” would NOT be served by the issuance of the requested license and direct staff to notify ABC of the City Council's decision.
Fiscal Impact: The City may potentially receive additional revenue through business taxes from the increased sales of the upcoming business, Willits Discount Market, through their ability to serve beer and wine.
Personnel Impact: None.
Identified City Council Conflict of Interest: None.
2021 Adopted Goals: N/A
California Environmental Quality Act: N/A
This Item Relates to the following General Plan Element : N/A Land Use Circulation Conservation and Open Space Noise Housing Public Services and Facilities, Parks and Recreation Economic Development
Reviewed by: City Manager City Attorney Assistant City Manager City Clerk Finance Director Human Resources
Council Action: Approved Denied Other: ________________________________________ Records: Agreement Resolution #_________ Ordinance #_________ Other _________ April 23, 2025
Alcohol Beverage Control Licensing Representative II Iris Villalpando 50 D Street, Suite 130 Santa Rosa, CA 95404
Re: Off-Sale Beer & Wine License
Dear Iris Villilpando (or To Whom It May Concern):
At the Willits City Council meeting of April 23rd, 2025, the Council considered the request by Willits Discount Market to be issued a Type-20 Off-Sale Beer & Wine License at their business, located at 851 South Main Street, Willits, CA 95490. At that meeting it was determined by the City Council that public convenience would be served by allowing Willits Discount Market to be issued said license.
Sincerely,
Mayor, City of Willits
Gateway to the Redwoods
CITY OF WILLITS
111 E COMMERCIAL STREET, WILLITS CA 95490 • PHONE: (707) 459-7112 • FAX: (707) 459-1562
COMMUNITY DEVELOPMENT DEPARTMENT
1 10a
Monthly Achievements & Activities
• March was a quiet month at the airport, as we are still in the winter months and not quite ready to start preparing for summer.
• Maintenance crews conducted their weekly inspections, with no maintenance issues to report. • A few more “No Trespassing” signs have been installed at both the north and south ends of the runway.
• In staff’s weekly visits to the airport, we have noticed a decrease in unauthorized pedestrian activity.
• The city reached out to Supervisor John Haschak for an update on the FEMA Building Resilient Infrastructure Communities Grant (BRIC - fuel reduction grant) that was awarded to the County of Mendocino and this is the response we received:
One project that promised to enhance community safety significantly was the Building Resilient Infrastructure and Communities (BRIC) grant. Last year, the County received $3.6 million from the BRIC grant through FEMA and matching funds from a Prepare CA Match grant. This funding was for the first phase of a multi-phase, $50 million project to create defensible space, reduce hazardous fuels, and retrofit homes with ignition-resistant materials to address wildfire hazards in the Brooktrails/Sherwood Corridor. This initiative was crucial for improving the County's wildfire preparedness and resilience, especially given that this area is considered one of the highest priorities in the state.
Unfortunately, staff informed me that FEMA released a memo announcing the termination of the BRIC program. As part of this decision, it states that all BRIC applications from Fiscal Years 2020-2023, which would include ours, are being canceled. The memo referred to the program as "yet another example of a wasteful and ineffective FEMA initiative.” This federal action seems to be taken without consideration for the well-being of our community, and it certainly undermines our efforts to enhance safety.
That is all we know at the moment. Staff have a conference call with other counties that had pending BRIC grants. Hopefully we can join forces to fight this unilateral change.
Best to you, John
As soon as the city receives more information from Supervisor Haschak, we will update this report.
Airport March 2025 | Report
2 • Part 16 Update – On March 26, 2025, the City received a determination letter from the Federal Aviation Administration (FAA) with respects to Paul Trexel v. City of Wiliits, CA – FAA Docket No. 16-23-07.
The Director finds that the City of Willits, CA, sponsor and operator of the Willits Municipal Airport/Ells Field (028) is currently in violation of its federal obligation regarding Grant Assurance 19, Operation and Maintenance by failing to prevent pedestrians/unauthorized access to the Airport. The Director finds that the City is not currently in violation of its federal obligations with regards to tree obstruction on and in the vicinity of the airport, or regarding existing hangar uses. Lastly, the Director finds that the City is not currently in violation of Grant Assurance 21, Compatible Land Use regarding residential (RV) use of the Airport since the parties vacated the Airport and the issue was remedied.
The FAA ORDER – The City shall present a corrective action plan to the Director for review and approval within 30 days, which was extended to May 11, 2025. Therefore, staff is meeting with our airport consulting firm and airport attorney to draft and finalize a response before May 11th.
Project Updates
• The PAPI (Precision Approach Path Indicator) Lights on the Runway have been fully repaired.
Staffing Items
• No items to report.
Budget Status
• No items to report.
Focus for Next Month
• Continuing our efforts to prioritize items identified by Caltrans in their inspection report that requires corrective action.
• Negotiate a Land Use Agreement with CALFIRE for potential firefighting operations. 1 Monthly Achievements & Activities
• Issued thirteen Building Permits.....................................Sixteen in February. • Opened eight Code Enforcement Cases .....................Three in February. • Closed eight Code Enforcement Cases........................Zero in February. • Total of 44 active Code Enforcement Cases...............44 in February. • The Department required an average of 1 calendar day to issue December Building Permits. Over the counter Permits (reroofs/minor electrical) are typically issued on the day of submission and are not included in the average processing timeline. Timeline includes time for Fire Department to complete required review for certain permits.
Project Updates
• Rail with Trail Project:
o Received CDFW approval of final designs.
o Held kick-off meeting with contractor, consultants and City staff. • Caltrans Clean California Grant (Beautify Willits Project):
o The 2nd annual Clean Canvas event is scheduled for Saturday, April 19th at Bud Snider Park. o Consultants are finalizing designs for Bud Snider Park improvements based on Council direction at the February 12 Council meeting.
o The City put out a call to artists for our mural project at Recreation Grove. Four local artists submitted conceptual mural designs which were put display at the Willits Art Center starting March 29th. Over 100 votes were tallied, and the winning 2 artists will be commissioned to paint their mural on a canvas attached to the Recreation Grove stage upon Council review an approval at an upcoming Council meeting.
o Completed grant reimbursement request
• Willits Housing Rehabilitation Program:
o Requested release of PLHA funds ($119,647) from State to support 2nd round of program funding.
o Working with contractors and property owners to fund and complete home improvements for the 5 property owners that were awarded funding in the 1st round of program funding. • Land Use Element Update
o Completed Zoning Map Update
o Staff anticipates bringing forward an updated zoning map, consistent with the previously adopted Land Use Diagram, as well as the new Mixed Use Zoning Districts for Council consideration at a May Council meeting.
• Mobile Vendor Ordinance
o Supported an informational discussion regarding a comprehensive Mobile Vendor Ordinance at the March 12th Council meeting.
Community Development March 2025 | Report
2 o The Council has created an Ad Hoc Committee consisting of 2 Council members to develop recommendations to bring back to the full Council for consideration. • RCHDC Affordable Housing Development
o Held a community meeting on the evening of March 31st to provide information and solicit feedback on the prospective 62-unit housing development and alternative transportation improvements (i.e. sidewalks, safety enhanced crosswalks) to be funded by the Affordable Housing and Sustainable Communities (AHSC) Grant.
o A zoom meeting for the same purpose was held on April 2nd.
Staffing Items
• No items to report.
Budget Status
• No items to report.
Focus for Next Month
• Land Use Element Update:
o Finalize Development of Mixed-Use Zoning Districts and related recommendations per adopted policies in the General Plan Land Use Element
• Rail with Trail Project:
o Seek additional grant funding to support project construction costs. o Complete grant reimbursement request
o Complete quarterly project report
• Clean California Grant:
o Continuing planning for Clean Canvas Event
o Complete quarterly project report
• CDBG NOFA
o Continue to develop application to compete for next round of CDBG grant funds, to open this summer, in support of local business community
• Affordable Housing and Sustainable Communities (AHSC) Grant o Continue to work closely with RCHDC to develop an AHSC grant application to support construction of 62 housing units and alternative transportation improvements including new sidewalks and a new bus stop as well as repair and upgrades of existing sidewalks and bus stops.
• Mobile Vendor Ordinance
o Work with Ad Hoc Committee to develop recommendations for a mobile vendor ordinance. • Business License Program
o Continue to fine tune business license program to create further process efficiencies and expedite review process.
10c
Monthly Achievements & Activities
• Presented Audit 2022-23 for council.
Project Updates
• Springbrook Implementation:
o Schedule the HR Module training in progress.
o Working on increasing hours for Implementation for Fund Balance upload that will initiate the year end process for Audit of 2023-24.
o Project Management Module review is in progress.
o Staff expects to go live with utility billing in June.
Staffing Items
• Actively working on the realignment of the Finance Department. • S & L Controller Services are actively working on Bank Reconciliation and will provide fund balances for the move from ACS to Springbrook.
Budget Status
• Reviewing the Capital Improvement Plan to rank active and proposed projects for FY 25-26 Budget.
• Staff expects to compose an annual Budget instead of a biennial version. • Prepare Department worksheets.
Focus for Next Month
• Auditors expect to have the FY 23-24 Audit by mid-May or early June due to updating of fund balances, and Mapping of new Springbrook Software system for upload. • Budget for FY 2025-26
• Submit Schedule of Expenditure of Federal Awards (SEFA) for Single Audit Report FY 2022-23. • Getting Springbrook to update fund balances for FY 23-24 bank reconciliation and Audit preparation.
Finance March 2025 | Report
Monthly Achievements & Activities
March 2024 March 2025
• 911 Calls Received 60 41
• Calls for service (CFS) 544 442
• Cases 38 49
• Arrests 17 26
• Citations 25 21
• Traffic Stops 80 41
Project Updates
• As staffing allows - continued traffic safety education and enforcement, emphasizing school zones, pedestrians, speeding, and passing to the right violations. • Continued deployment of the speed awareness radar trailer. • Two new patrol cars are in the process of being outfitted with emergency equipment. Precision Wireless is scheduled to upfit.
• Providing extra patrols in city parks as time allows. • Altavista (radio, 911, cad/rms upgrade vendor) has completed their Phase 1 report for recommendations.
Staffing Items
• Two additional Police Officer Recruits are finishing the background and hiring process and may be hired in this Spring.
• One Police Dispatcher Candidate is in background.
• The Department continues to focus on an ongoing recruitment effort to fill vacancies for Police Officers, Dispatchers, and Community Service Officers.
Training
• Officers John Gale and Damian Angell attended Crisis Intervention Training. • Officer John Gale attend Criminal History “rap sheet” training.
Other
• Officers Jamie Cary and Damian Angell received a Recognition of Outstanding Investigation letter which was placed in their personnel file. Case 24-00005067 a sexual assault against a minor perpetrated by a family member. With teamwork and tenacity, the investigation resulted in two felony convictions.
Police Department March 2025 | Report
• California Commission on Peace Officer Standards and Training Region One representative Lisa Holton conducted an on-location audit/review of our police department on March 26, 2025. The police department was found to follow State standards.
1 Monthly Achievements & Activities
● The sandbag station was closed and put away for the year. The Flooding advisory signs and road closure barricades were also collected from their staging areas and returned to the corp. yard for storage.
● Overall, after-hours calls for service to mitigate flooding and clogged storm drains were minimal this winter. Daily patrols and preparation contributed to a reduction in weather related issues. ● The Athletic Fields were prepared for the start of the spring season. Irrigation is being evaluated to assess the system and identify any needed repairs. Regular irrigation will begin and slowly increase as the temperatures begin to rise and the ground firms up. ● The Maintenance Department is servicing roadside mowing equipment and making ready for the first of many rounds of weed and brush abatement throughout the city right-of-way, ditch lines, public spaces, and adjacent to infrastructure. This will be on going through the spring and summer season. An additional tractor mower was priced to replace aging equipment and was put in the 2025 budget allocation to improve staffs’ ability to perform this critical duty. ● Staff assisted with planning and support for the upcoming Memorial Day Car and Bike Show. ● Water leaks and Sewer issues were addressed as needed. Some of these included but were not limited to removing a large amount of trash and debris from a large manhole adjacent to the railroad tracks behind the new CCC facility on East Hill Road. The manhole appeared to have been filled with items from transient activity in the area, and the crews spent several days removing it. There were sink holes on Raymond Lane that formed between the roadway and private property at two locations that were excavated and backfilled. There was also another sink hole reported on North Street that upon excavation was found to be the result of a failing sewer lateral. The crew repaired the line and installed a clean out. (see Utility report for more info).
● A large Pine tree was trimmed for building clearance and dead wood was removed over private property on Holly St. The tree is located on property currently owned by the City and was originally a provisional alley between Hazel and Holly streets when the housing development was built. Staff is looking into options on how to best address the deferred maintenance and may ultimately recommend relinquishment.
● Main St. chip beds around the trees were cleaned out and new mulch was added over the top to reduce water evaporation during irrigation. Grass and weeds along the corridor were cut back and the sidewalk was blown off. The street sweeper is running Friday mornings unless weather, public safety issues, or emergency utility repairs take priority.
Services & Facilities MARCH 2025 | Report
2 Project Updates
● Cold Creek Compost was contacted, and several loads of compost are scheduled to be delivered to the Skate Park parking lot area for public consumption. The loads will start showing up on April 17th and 18th, with additional loads to follow pending utilization. This is a yearly event coordinated by the Community Development Department and the Maintenance Department to provide organic compost to the community and helps meet State requirements. ● A new electrical supply cabinet and circuit board were installed at Babcock Park to provide power to the fountain pump, lighting, and the irrigation timer. The project was an upgrade to the old system that was in dire need of modernization. The work was contracted through Coastal Mountain Electric and funded through the Clean California Grant. ● The base rock bin was re-stocked at the Corp. yard, and asphalt cold mix will be ordered toward the end of April.
● Benches milled and built using wood from the Giant Sequoia Redwood tree that was removed for public safety at Babcock Park are complete and are now in the lobby at City Hall. ● The Corp. yard received grindings from Ghilotti Brothers Construction, generated from the paving project on Baechtel Rd. for the new PG&E yard and used it to repair the washed-out access road to the Delta ponds. The access road is currently under repair and prone to flooding.
Drainage issues are also being addressed as time allows. ● The Maintenance crew boarded up and secured the old Print Shop building on the corner of Alameda x S. Main St. at the request of Code Enforcement and the City Building Official. The building has been vacant for some time, and the property owner is non-responsive to attempts to contact. The building and surrounding lot was frequently occupied by transients and had become a potential threat to public health and safety.
● The PAPI (Precision Approach Path Indicator) Lights on Runway 34 at the Airport have been repaired.
● The Wood St. Parking lot solar lighting project is complete, improving the safety and visibility of the site.
Staffing Items
• No items to report.
Budget Status
• No items to report.
Focus for Next Month
● Prepare the Sports Complex and Grounds for the upcoming athletic season. This includes field aeration and fertilizing, mowing and irrigation assessment, building maintenance, and installing any items purchased or made available through the improvement grants. - ongoing ● Re-stock material bins for spring, including asphalt and woodchips. ● Sign and furniture installation in the parks as the weather permits, some items will be withheld until various improvement phases are completed later this year. - ongoing ● Work on removing small trees and shrubbery on the runway ends at the Airport before fire season and flight operations increase. – outstanding item ● Address pavement and storm drain issues that have developed over the winter that can be repaired in-house. - underway
3 ● Evaluate and trim back trees where possible to provide better overhead vehicle clearance and line of sight distance to traffic signs at various locations. Planning to address areas that exceed the current capacity. - underway
● Finish covered roof structure at the Corp. Yard and begin to utilize the space. ● Designate and prepare additional staging areas at the Corp. Yard. For Spring and Summer projects. Receive materials and store appropriately. - ongoing ● Continue to assist the Community Development Department with planned improvements and grant funded project as needed. This will be ongoing for the construction season and into the fall.
● Prepare downtown and Snider Park for the upcoming Car and Bike Show.
1 Monthly Achievements & Activities
• Repaired broken drainpipes for backwash ponds at SWTP. • Operators assisted PW crew on water leaks on S. Main St and Holly. • Repaired 2” pack joint fitting at the Bittenbender pump station. • Replaced tank level float in the Laurel St distribution storage tank. • Remounted Bittenbender pump station pump to the concrete. • Repaired leaking valve at the raw water pump station at SWTP. • Worked with Apex and Primex on SCADA network dropping out of communication at WWTP. • Coastal Mountain Electric replaced electrical line for the South Clarifier automation control to SCADA at WWTP.
• Repaired manholes D20, B43, B5 and B34 in the sewer collection system to stop infiltration of rainwater.
• Operators assisted Streets crew in unclogging a manhole filled with garbage behind the new California Conservation Corp (CCC) campus.
• Assisted the streets crew with Vactor on multiple water leaks around the distribution system. • Replaced a failed sewer lateral on Holly St in the sewer collections system. • Sewer camera for the collections system was sent into the manufacturer for battery issue repair. • WWTP operators assisted the water department with the three-night Main St flushing. • Working with High Country Security on the headworks PLC water leak issue at WWTP. • Started seasonal mowing around the WWTP and Delta Storm Ponds with Heston tractor. • Inspected four and signed off on two sewer lateral inspections for home sales. • Cleaned approximately 1100 lineal feet of sewer mainline throughout the sewer collection system, notably in the troubled areas.
• Submitted water annual report to the State Water Resources Control Board (SWRCB) March 30th. • Completed and submitted the annual Consumer Confidence Report for the SWTP.
Project Updates
• Ongoing: Fats, Oils and Grease (F.O.G.) program throughout the sewer collection system. • Ongoing: Sewer lateral inspection program.
• Ongoing: Water meter replacement program.
• Ongoing: Grounds maintenance at Water/Wastewater facilities. • Annual water main flushing program update: Completed night flushing and operators are working the west side of town during the daytime, flushing completed up to the R.R. crossing at Walnut St as of 4/14/25.
Utilities March 2025 | Report
2 • Reservoir Capacity: Morris 662-acre feet and Centennial 638-acre feet equate to 100-percent of full capacity (April 14th). Both reservoirs are overtopping. • March 2025 Water Usage: SWTP: 11,647,232 MG. March 2024: 15,839,089 MG.
GWTP: 2,100,000 MG. March 2024: 0 MG.
Totals: 13,747,232 MG. March 2024: 15,839,089 MG.
• Non-Potable Water Usage [Truck Fill Station]: 3,500 K/Gals. March 2024: 16,290 K/Gals. • March 2025 Wastewater Treatment Plant Flows: 67,730,714 MG.
Staffing Items
• None.
Budget Status
• No items to report.
Focus for Next Month
• Schedule electrical equipment upgrade and permanent weather structure at Northbrook Pump Station with Fuller Electric.
• Upgrade sewer camera truck hardware and software equipment to the newest version with WECO Company. Received quote for upgrade 2/11/25. Schedule upgrade for end of April. • Schedule C.C. Overra Construction to do a reinforced permanent fix on the Upflow Solids Contact Clarifier at the SWTP. April scheduled for a tentative date. • Order new 2025 backhoe for the Services and Facilities department to replace the 2002 Caterpillar model and surplus it to SWTP for watershed and road maintenance. (16-week lead time)
• Received quote. Schedule time in April for Langemann Gate repair at WWTP. • Scheduled Westec to replace Filter #2’s aluminum screens with the purchased stainless-steel screens. This is the last filter of three that need to be replaced. • Receive quotes for filter media replacement at SWTP for Trident Filters from Westec. Funds budgeted in FY 25/26.
• Order new M6 Kubota tractor and mower for the replacement of Heston at the WWTP for use of mowing grounds at the facility and use for application of annual bio-solids into the 18-acre sludge field. (10–12-week lead time)