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HomeMy Public PortalAbout07) 7D Comprehensive Annual Financial Report 2019-06-30AGENDA ITEM 7.D. A DMINIS TRATIVE SERVI C ES DEPA RT M E NT M EMORANDUM DATE : TO: FROM: January 21, 2020 The Honorable City Council , Bryan Cook, City Manager By: Susan Paragas, Administrative Services Director SUBJECT: COMPRE HENS IV E ANNUA L FINANCIAL REPORT FOR TH E YEAR ENDED JUN E 30, 2019 RECOMM ENDATION: It is recommended that the City Council consider the recommendation from the Audit Committee to receive and file the following reports: 1. Comprehensive Annual Financial Report (CAFR) for the year ended June 30, 2019 (Attachment "A"); 2 . • Independent Auditor's Communication to the City (Attachment "B"); 3. Independent Accountants' Report on Applying Agreed-Upon Procedures Related to the Article XIII -B Appropriations Limit Calculation (Gann Limit) (Attachment "C "); and 4. Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Othe r Matters Based on an Audit of Financial Statements Performed in accordance with Government Auditing Standards (Attachment "D"). BACKGROUND: 1. In November 1979, Proposition 4 was approved by the voters adding Article XIIIB , also known as the Gann Limitation, to the State Constitution to ensure that limits were placed on all state and local government appropriations. These appropriations calculations must be approved by the City Council on an annual basis . 2. In June 1990, the voters of California approved Proposition 111 which revised the annual adjustment factors applied to the limit and each year thereafter. City Council January 21, 2020 Page 2 of 5 3. On June 19, 2018, the City Council adopted Resolution No. 18-5336 confirming the factors used for calculating the annual appropriations limit for the Fiscal Year (FY) 2018-19 City Budget. 4. On October 28, 2019, the Administrative Services Department received notice from the Government Finance Officers' Association (GFOA) that the City received the Excellence in Financial Reporting Award program for its FY 2017-18 CAFR. 5. On, December 20, 2019, the Audit Standing Committee (i.e. Mayor Pro Tern Chavez and Councilmember Yu) met with City staff and audit staff from Eide Bailly, LLP (EideBailly) and discussed the results of the field work and audit. ANALYSIS: Financial Reporting A CAFR is a set of United States government financial statements comprising the financial report of a state, municipal or other governmental entity that complies with the accounting requirements, (i.e., Generally Accepted Accounting Principles (GAAP)). created and circulated by the Governmental Accounting Standards Board (GASB). The CAFR accounting structure provides for standardization of financial reporting. All levels of government including federal, state, local and municipal, produce a CAFR to document an accurate picture of institutional funds, enterprise or financial holdings, assets and total investment incomes for those government and nongovernmental entities using the report. (Attachment "A") Single Audit As a recipient of federal grant funds in past years, the City has been required to be in compliance with the requirements of the Office of Management and Budget Circular A-133, Audits of States, Local Governments and Non-Profit Organizations. The process, to ensure that the City is in compliance with this Circular, is commonly known as the "Single Audit". For FY 2018-19, the City federal grant expenditures were less than $750,000, therefore, a Single Audit was not required. Auditors The auditors from EideBailly, (acquired Vavrinek, Trine, Day and Company, LLP) provided a communication letter, AU-C260 (Attachment "B"), to convey to the City Council (Council) matters related to the financial statement audit that are, in the auditors' professional judgment, significant and relevant to the responsibilities of the Council in overseeing the financial reporting process. Gann Limit and Other Reports Article XIII-B (Gann Limit) provides limits to the amount of tax proceeds state and local governments can spend each year. The limit for any fiscal year is equal to the previous City Council January 21, 2020 Page 3 of 5 year's limit, adjusted for population changes and the change in the U.S. Consumer Price Index or California per capital personal income, whichever is less. A review of the City's calculations is required by State law and is included as Attachment B. In addition, the auditors are required by the Statement of Auditing Standards (SAS) to prepare independent report on internal controls over financial reporting and a schedule of findings and responses. These documents are included as Attachment C and D respectively. Audit EideBailly issued an unmodified ("clean") opinion on the City financial statements for the year ended June 30, 2019. The City also provides a narrative introduction, overview and analysis of the CAFR in the form of Management's Discussion and Analysis (MD&A). It can be found immediately following the independent auditors' report. The City's net position increased by $2.6 million from $68.6 million as of June 30, 2018, to $71.2 million as of June 30, 2019 as a result of this year's operations. Total revenues from all sources was $21.7 million and the total cost of all City programs was $19.1 million. The City's total long-term liabilities increased by $1.3 million during the current fiscal year. The key factors in this increase are the CalPERS pension (Pension) liability and Other Post-Employment Benefits (OPEB) liability. The General Fund (GF) revenues of $15.8 million exceeded GF expenditures of $14.4 million which provided for an excess of revenues over expenditures of $1.4 million. Further, after the net transfers out, primarily for capital projects, the General Fund realized a net increase in fund balance of $1.1 million. Primary revenue sources for this fund are sales tax, property tax and motor vehicle in lieu. The GF is responsible for general services of the City which includes public safety, public works, community development, community services and administration. The largest expenditure is for public safety, which was $5.4 million for FY 2018-19. The Pension and OPEB liabilities are two key factors that could significantly impact the City's long-term liabilities due to the sensitivity of the discount rates that are applied to each of the plans' assets. A discount rate is the long-term expected rate of return on investments. Currently, Pension assets use a discount rate of 7.15%. The table below reflects how sensitive the City's proportionate share of the net pension liability is impacted when the discount rate is 1 % lower or 1 % higher. City's Proportionate Share of Net Pension Liability Discount Rate (-1 % ) (6.15%) $12.02 million Current Discount Rate (7.15%) $7.91 million Discount Rate (+1%) (8.15%) $4.51 million City Council January 21, 2020 Page 4 of 5 If CalPERS determines to reduce the discount rate by 1 % due to lower investment earnings, the City's Pension liability increases by $4.11 million. On the other hand, if the investment earnings do well, a 1% increase in the discount rate results in a decrease of $3.40 million of the Pension liability. OPEB assets use a discount rate of 4.10%. The table below reflects how sensitive the City's net OPEB liability is impacted when the discount rate is 1 % lower or 1 % higher. Discount Rate (-1%) (3.10%) City's Net OPEB Liability $8.69 million Current Discount Rate (4.10%) $7.14 million Discount Rate (+1%) (5.10%) $5.91 million A 1% decrease in the OPEB discount rate results in additional liability of $1.55 million for the City while a 1 % increase in the discount rate lowers the OPEB liability by $1.23 million. Should the discount rates for the Pension and/or OPEB assets decrease, staff will determine a course of action to address the financial impacts to the City. GFOA Excellence in Financial Reporling Award Staff submitted the FY 2018-19 CAFR to the GFOA for the Excellence in Financial Report Award and is awaiting the result. The GFOA recognizes innovative programs, contributions to the practice of government finance that exemplify outstanding financial management. The award stresses practical, documented work that offers leadership to the profession and promotes improved public finance. Audit Standing Committee For greater transparency and accountability, the City Council appointed an Audit Standing Committee (Committee), making it directly responsible for monitoring the work performed by the independent auditor. As outlined in the Audit Committee Charter, also adopted by the City Council, the responsibilities of the Audit Standing Committee include: • Assisting the City Council in monitoring, overseeing and assessing the City's: ► Accounting and financial reporting processes; ► Quality and integrity of the City's financial statements, including audits of the financial statements; ► Qualifications, independence and performance of the independent auditor; City Council January 21, 2020 Page 5 of 5 ► Compliance with applicable legal and regulatory financial accounting requirements; and ► Management's ability to evaluate adequacy of internal controls and capably identify and control risks posed by its current and planned activities. • Providing an avenue for communication among the independent auditors, City management and the City Council. The Committee also has such other duties as set forth in this charter and as directed by the City Council. The Committee met on December 20, 2019 to discuss the result of the audit, thus, completing their due diligence as outlined in the Committee Charter and has brought forward their recommendation to receive and file the CAFR for the year ended June 30, 2019. CITY STRATEGIC GOALS: Approval to receive and file the CAFR for FY 2018-19 will further City's Strategic Goal to promote Good Governance. FISCAL IMPACT: This action of receiving and filing the CAFR does not have a fiscal impact on the FY 2019- 20 City Budget. However, staff has begun the mid-year budget analysis and will be incorporating the results of actual spending in FY 2018-19, as reflected in the CAFR, in the FY 2019-20 Mid-Year Budget Report. ATTACHMENTS: A. Comprehensive Annual Financial Report (CAFR) for the year ended June 30, 2018 B. Auditor's Communication to the City Council C. Independent Accountants' Report on Applying Agreed-Upon Procedures Related to the Article XIII-B Appropriations Limit Calculation D. Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in accordance with Government Auditing Standards ATTACHMENT A CITY OF TEMPLE CITY Comprehensive Annual Financial Report for the period ended June 30, 2019 www.templecity.us ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED JUNE 30, 2019 City of Temple City, California Comprehensive Annual Financial Report Year Ended June 30, 2019 Prepared by: ADMINISTRATIVE SERVICES DEPARTMENT Susan Paragas Administrative Services Director ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED JUNE 30, 2019 TABLE OF CONTENTS INTRODUCTORY SECTION ATTACHMENT A PAGE Letter of Transmittal ...................................................................................................................... i List of Elected Officials and Management Personnel ................................................................. vi Organizational Chart .................................................................................................................. vii Certificate of Achievement for Excellence in Financial Repmting ........................................... viii FINANCIAL SECTION Independent Anditor's Report .................................................................................................. 1 Management's Discussion and Analysis ................................................................................... 4 Basic Financial Statements Government-wide Financial Statements Statement of Net Position .............................................................................................. 13 Statement of Activities .................................................................................................. 14 Fund Financial Statements Description of Major Funds .......................................................................................... 15 Balance Sheet ................................................................................................................ 16 Reconciliation of the Balance Sheet of Governmental Funds To the Statement of Net Position ................................................................................. 18 Statement of Revenues, Expenditures and Changes in Fund Balances ......................... 19 Reconciliation of the Statement of Revenues, Expenditures and Changes In Fund Balances of Governmental Funds to the Statement of Activities .................. 21 Proprietary Fund Description of Proprietary Fund .................................................................................... 22 Statement of Net Position .............................................................................................. 23 Statement of Revenues, Expenses and Changes in Net Position ................................... 24 Statement of Cash Flows ............................................................................................... 25 Fiduciary Funds Description of Fiduciary Funds ..................................................................................... 26 Statement of Fiduciary Net Position .............................................................................. 27 Statement of Changes in Fiduciary Net Position ........................................................... 28 Notes to Financial Statements ........................................................................................... 29 REQUIRED SUPPLEMENTARY INFORMATION Budgetary Comparison Schedule General Fund ................................................................................................................. 60 Notes to Budgetary Comparison Schedule ................................................................................. 62 Schedule of Proportionate Share of the Net Pension Liability ................................................... 63 Schedule of Contributions .......................................................................................................... 64 Schedule of Changes of the Net OPEB Liability ....................................................................... 65 Schedule ofOPEB Contributions ............................................................................................... 66 CITY OF TEMPLE CITY, CALIFORNIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED JUNE 30, 2019 TABLE OF CONTENTS ATTACHMENT A PAGE SUPPLEMENTARY SCHEDULES Nonmajor Governmental Funds Combining Balance Sheets ............................................................................................ 67 Combining Statement of Revenues, Expenditures and Changes in Fund Balances ............................................................................................................. 68 Nonmajor Special Revenue Funds Description ofNonmajor Special Revenue Funds ........................................................ 69 Combining Balance Sheet ............................................................................................. 71 Combining Statement of Revenues, Expenditures and Changes in Fund Balances ...... 76 Schedule of Revenues, Expenditures and Changes in Fund Balances -Budget and Actual Permanent Fund ............................................................................................................. 81 COPS Fund .................................................................................................................... 82 Public Transportation -Prop A Fund ............................................................................ 83 Public Transportation -Prop C Fund ............................................................................ 84 Used Oil Fund ............................................................................................................... 85 State Gas Tax Fund ....................................................................................................... 86 Traffic Congestion Relief -Section 2182 Fund ............................................................ 87 CDBG Fund ................................................................................................................... 88 Air Quality Improvement Fund ..................................................................................... 89 Measure R Fund ............................................................................................................ 90 Sewer Reconstruction Fund ........................................................................................... 91 Road Maintenance Rehab Act (RMRA) Fund .............................................................. 92 1992/1996 Park Bond Fund ........................................................................................... 93 Measure M Fund .......................................................................................................... 94 Park Acquisition Fund ................................................................................................... 95 Lighting and Landscape District Fund .......................................................................... 96 CITY OF TEMPLE CITY, CALIFORNIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED JUNE 30, 2019 TABLE OF CONTENTS STATISTICAL SECTION ATTACHMENT A PAGE Description of Statistical Section Contents ....................................................................................... 97 Financial Trends Net Position by Component -Last Ten Fiscal Years ................................................................. 98 Change in Net Position -Expenses and Program Revenues -Last Ten Fiscal Years ............... 99 Fund Balances of Governmental Funds -Last Ten Fiscal Years ............................................. 100 Changes in Fund Balances of Governmental Funds -Last Ten Fiscal Years .......................... IOI Revenue Capacity Assessed Value of Taxable Property-Last Ten Fiscal Years ................................................. 102 Direct and Overlapping Property Tax Rates -Last Ten Fiscal Years ...................................... 103 Property Tax Levies and Collections -Last Ten Fiscal Years ................................................. 104 General Fund Revenues -Last Ten Fiscal Years ..................................................................... I 05 Principal Prope1ty Taxpayers-Current Fiscal Year and Nine Fiscal Years ............................ 106 Top 25 Sales Tax Producers -Current Fiscal Year .................................................................. 107 Debt Capacity Direct and Overlapping Debt .................................................................................................... I 08 Demographic and Economic Information Demographic and Economic Statistics -Last Ten Fiscal Years .............................................. I 09 Operating Information Construction Activity -Last Ten Fiscal Years ........................................................................ 110 Full-Time Equivalent City Employees by Function -Last Ten Fiscal Years .......................... 111 Operating Indicators by Function -Last Ten Fiscal Years ...................................................... I I 2 Capital Asset Statistics by Function/Program .......................................................................... 113 ATTACHMENT A 9701 LAS TUNAS DRIVE • TEMPLE C ITY • CALIFORNIA 91780-2249 o (626) 285-2171 December 26, 2019 To the Honorable City Council, The Comprehensive Annual Financial Report (CAFR) of the City of Temple City ("City") for t he year ended June 30, 2019 , is hereby submitted as mandated by applicable State of California statues. These statues require that the City annually issue a report on its fi nancial position and activity, and that an independent firm of certified public accountants audit this report. Responsibilities for both the accuracy of the data and the completeness and fairness of the presentation , including all disclosures rests with the City's management. The information in this report is intended to present the reader with a comprehensive view of the City's financial position and the results of its operations for the fiscal year ending June 30, 2019 , along with additional disclosures and financial information designed to enable the reader to gain an understanding of the City's financial activities. Eide Bailly, LLP, a firm of certified public accountants, has issued an unmodified ("clean") opinion on the City's financial statements for the year ended June 30 , 2019. The independent auditor concluded , based upon the audit that the City's financial statements for the fiscal year ended June 30, 2019 are fairly presented in conformity with generally accepted accounting principles (GAAP). The auditor's report is presented as the first component of the financial section of this report . Generally accepted accounting principles also require that management provide a narrative introduction, overview and analysis of the basic financial statements in the form of Management's Discussion and Analysis (MD&A). It can be found following the independent aud itor's report. PROFILE OF THE GOVERNMENT The City is centrally located in the west San Gabriel Valley approximately 13 miles east of downtown Los Angeles and is in Los Angeles County. The City was incorporated on May 25, 1960 under the general laws of the State of California. On April 16, 1971 , the City adopted Resolution No. 71-1084 declaring it a charter city. The City is approximately 3 .85 square miles and is surrounded by the cities of Arcadia, San Gabriel , El Monte, Rosemead and unincorporated portions of Los Ange les County. The 20 10 U.S. Census Bureau indicates a total population of 35,558. The City is predominately a residential community with over 10,000 residential parcels. The City is a charter city and operates under the Council -Manager Form of government and contracts for many of its public services including law enforcement. ATTACHMENT A LOCAL ECONOMY The City of Temple City is a diverse, multicultural community centered on family values and active civic engagement. Its population increased to almost 36,600 (+172) with a median age of 43.0 years. The unemployment rate continues to be low at 3.8% for 2018. The 2018 taxable sales for the City was $214.2 million which is an increase of 5.2% or $10.6 million over 2017. The largest increase was in the category of Eating and Drinking Places which rose by 10.9% (+$7.14 million) and comprised 34.0% of the total taxable sales for 2018. Assessed valuation ("AV") of citywide properties in FY 2018-19 increased by 6.9% from $4.96 billion to $5.22 billion primarily due to a $242 million increase in the AV of residential properties. This growth is mostly due to the Los Angeles County Assessor's annual increase in assessed value of up to 2% and a net increase of 40 residential parcels. However, the average sales price of a single family residence dropped to almost $808,000 in 2019 from $877,000 in 2018 which is a decrease of $69,000 (-7.9%). The City adopted a balanced budget for FY 2019-20 without reducing services. Mid-year adjustments are made to revenues and expenditures based on the economic changes during the year. It is important that the City continue to monitor and control all potential expenditure increases as revenues do not increase at the same rate. The City continues to ensure that it builds healthy reserves to handle any downturn in the economy. MAJOR ACCOMPLISHMENTS The City of Temple City is and strives to continuously be a Great Public Service Oriented Organization -and works toward be recognized by its citizens and its stakeholders for its innovative and exceptional service to the community. Accomplishments for the Fiscal Year (FY) 2018-19 include: Vision and Long-Range Planning • Made substantial progress on the comprehensive update of the Zoning Code. Including the Planning Commission's review and recommendation that the City Council approved the Zoning Code. • Initiated the development impact fee study. • Completed a Zoning Code Ordinance related to the height of buildings on flag lots and the lots in front of flag lots. • Completed a review and recommendation to City Council on using Lyft to supplement the City's public transportation. Sound Fiscal Policy • Continued to receive unmodified (i.e., "clean") audit findings on the City's financial reporting via enhanced fiscal controls and checks and balances. • Recognition of excellence in financial reporting from Government Finance Officers Association of the United States and Canada. ATTACHMENT A • Increased Unassigned Fund Balance to $6.0 million in General Fund operating reserves. Public Health and Safety • Continued emergency preparation and training for residents through the Community Emergency Response Team (CERT). • Continued the successful Neighborhood Watch Program including monthly neighborhood meetings. Basic City Services • Continued to digitize critical city documents, allowing for easy reference and improved public transparency. • Prepared 78 Council meeting agendas and meeting minutes. • Published 14 legal and public hearing notices. • Coordinated the March 3, 2020 Consolidated General Municipal election for three council seats. • Provided municipal record management including the preservation and protection of public records. • Recruited and filled vacancies for 3 City Commissions. • Provided staff report for City's Youth Committee including meeting support and special events. • Completed 166 Public Records Requests. Quality of Life • Continued a robust offering of community events including an annual festival and numerous community celebrations. • The City continues to applaud and recognize volunteers for lending helping hands. Communication and Special Projects • Received a statewide communications award for Ea!TC, a social media campaign that builds awareness of local and renowned eateries. • Launched a rebrand of the award-winning CONNECT magazine to streamline content and make information more accessible. ATTACHMENT A • Continued to provide engaging and informative posts on the City's social media accounts, which averaged a 10% increase in followers. • Initiated the relocation of Chamber of Commerce operations to the civic center for greater visibility and service coordination. • Finalized pre-construction activities for the Temple City Library renovation and expansion project, which breaks ground in Feb. 2020. • Updated the City's downtown parking strategy to address current and future public parking needs. • Completed pre-design activities for the proposed $2.7-million Primrose Park project. • Initiated the City's first-ever pavement management plan, which now identifies a systematic program of maintenance, repair and improvements for Temple City streets. Sustainable Infrastructure • Completed Federal Closeout Coordination of Highway Safety Improvement Program projects including traffic signal upgrades and other safety enhancements citywide. • Completed Pavement Management Program (PMP) Implementation developing a city-wide pavement inventory and planning tools for upcoming pavement rehabilitation projects. OTHER FINANCIAL INFORMATION Internal Control Management assumes full responsibility for the completeness and reliability of the information contained in this report, based upon a comprehensive framework of internal control that it has established for this purpose. The internal control structure is designed to protect the City's assets from loss, theft, or misuse and to ensure that adequate accounting data is compiled for the preparation of financial statements in conformity with GMP. Because the cost of internal control should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute assurance that the financial statements are free of any material misstatements. Budgetary and Accounting System The City is required to adopt a budget for the following year before the end of each fiscal year. The objective of budgetary controls is to ensure compliance with legal provisions embodied in the annual appropriated budget approved by the City Council. The City's budgetary control is maintained at the individual departmental level and any change in the adopted appropriations by a department requires approval from the City Manager and/or City Council. AWARDS AND ACKNOWLEDGEMENTS The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for Excellence in Financial Report to the City of Temple City for its Comprehensive Annual Financial ATTACHMENT A Report (CAFR) for the fiscal year ended June 30, 2018. This was the seventh year that Temple City has received this prestigious award. In order to be awarded a Certificate of Achievement, a report must be published that satisfies both GAAP and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe that our current CAFR continues to meet the Certificate of Achievement Program 's requirements and we are submitting it to the GFOA to determine its eligibility for another certificate. The City's CAFR was prepared through combined efforts of City staff. Special recognition is due the Administrative Services Department staff for their effort to ensure timely and accurate reporting. I would also like to thank the City Council and the City Manager for their continued support and interest in planning and cond ucting the financial operations of the City in a responsible and progressive manner. Respectfully Submitted, Susan Paragas Administrative Services Director City of Temple City, California List of Elected Officials and Management Personnel June 30, 2019 City Council Nanette Fish, Mayor Tom Chavez, Mayor Pro Tern William Man, Councilmember Cynthia Sternquist, Councilmember Vincent Yu, Councilmember Administrative and Department Heads City Manager Administrative Services Director Assistant to the City Manager/Economic Development Manager City Clerk Community Development Director Parks and Recreation Director vi ATTACHMENT A Bryan Cook Susan Pa ragas Brian S. Haworth Peggy Kuo Michael D. Forbes Cathy Burroughs ATTACHMENT A Electorate I City Council I I I I I I I Planning Parks & Transportation & Recreation City Attorney City Manager Public Safety Youth Committee Commission Commission Commission ' I I I I Management Administrative Community Parks & Services Services Development Recreation Department Department Department Department vii l.. I Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting Presented to City of Temple City California For its Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2018 Executive Director/CEO viii ATTACHMENT A ·7 , .... _, _,,--►-; EideBaill~ CPAs & BUSINESS ADVI SORS Independent Auditor's Report The Honorable Mayor and the Members of the City Council City of Temple City, California Report on the Financial Statements ATTACHMENT A We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the City of Temple City, California (City), as of and for the year ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the City's basic financial statements as listed in the table of contents. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors' Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. What in spires you, in spires us. eidebailly.com 10681 Foo thill Blvd., Ste. 300 Rancho Cucamonga, CA 9 1730-383 1 T909.466.4 410 F 909.466.443 1 EOE ATTACHMENT A Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2019, and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management's discussion and analysis, budgetary comparison schedule for the General Fund, schedule of proportionate share of the net pension liability, schedule of contributions, schedule of changes in the net OPEB liability and schedule of OPEB contributions as listed in the table of contents, 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's basic financial statements. The introductory section, combining and individual non major fund financial statements and budgetary comparison schedules, and statistical section, are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual non major fund financial statements and budgetary comparison schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual non major fund financial statements and budgetary comparison schedules are fairly stated, in all material respects, in relation to the basic financial statements as a whole. The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on them. 2 ATTACHMENT A Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 26, 2019, 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 solely describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City's internal control over financial reporting and compliance. Rancho Cucamonga, California December 26, 2019 3 City of Temple City Management's Discussion and Analysis June 30, 2019 ATTACHMENT A The following discussion and analysis of the City of Temple City's financial performance provides an overview of the financial activities for the fiscal year ended June 30, 2019. Readers are encouraged to consider the information presented here in conjunction with the accompanying basic financial statements. Financial Highlights Government-wide Financial Statements: • The City's net position increased by $2.6 million from $68.6 million as of June 30, 2018, to $71.2 million as of June 30, 2019, primarily resulting from increases in current and other assets with decreases in capital assets being depreciated and were offset with liability increases in Other Post-Employment Benefits (OPEB) and pension liabilities; • The total revenue from all sources was $21.7 million; • The total cost of all City programs was $19.1 million; and • The City's total debt increased by $1.3 million during the current fiscal year. The key factors in this increase are the net increase in Pension and OPEB obligations of $1.3 million. Fund Financial Statements: • As of June 30, 2019, the City's governmental funds reported combined ending fund balances of $32.0 million, an increase of $4.6 from the prior fiscal year. Approximately $6.0 million of the balance is unassigned and is available for spending at the government's discretion; • As of June 30, 2019, the total fund balance of the City's General Fund was $20.0 million, an increase of $1.1 million from the prior year level of $18.90 million; and • In the General Fund, revenues exceeded expenditures by $1.4 million, before other financing sources/uses. Overview of the Financial Statements This discussion and analysis are intended to serve as an introduction to the City ofTemple City's basic financial statements. The City of Temple City's Comprehensive Annual Financial Report (CAFR) is comprised of three components: Introduction, Financial Section and Statistical Section. Government-wide financial statements. The government-wide financial statements are designed to provide readers with a broad overview of the City of Temple City's finances, in a manner similar to a private-sector business. The government-wide financial statements include not only the City, but also all legal entities for which the City is financially accountable, including the Successor Agency Private-Purpose Trust. The statement of net position presents information on all of the City of Temple City's total assets and deferred outflows of resources and total liabilities and deferred inflows of resources, with the difference reported as total net position. Over time, increases and decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. The statement of activities presents information showing how the City's net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing related to cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes). 4 City of Temple City Management's Discussion and Analysis June 30, 2019 ATTACHMENT A Both of the government-wide financial statements report on functions of the City of Temple City that are principally supported by taxes and inter-governmental revenues (governmental activities). The governmental activities of the City of Temple City include general government, community development, public safety, public works and community services. Fund financial statements. A fund is a group of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City of Temple City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City of Temple City are governmental funds. Governmental funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the City's near-term financing decisions. Both the governmental funds balance sheet and the statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. Information is presented separately in the governmental funds balance sheet and in the statement of revenues, expenditures, and changes in fund balances for the General Fund. The City of Temple City adopts an annual appropriated budget. A budgetary comparison statement has been provided to demonstrate compliance with this budget. Proprietary funds. The City maintains only one category of a proprietary fund, an internal service fund. Fiduciary fund. The City also maintains an Agency fund to account for the resources held and administered by the City of Temple City in a fiduciary capacity acting as the Successor Agency to the former Temple City Redevelopment Agency. Notes to basic financial statements. The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. Other information. In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning the City's budget comparison schedules for the General Fund and each major revenue fund and progress in funding its obligation to provide pension benefits to its employees. Government-wide Financial Analysis Our analysis focuses on the net position and changes in net position of the City's governmental activities for the fiscal year ended June 30, 2019. 5 City of Temple City Management's Discussion and Analysis June 30, 2019 ATTACHMENT A Net position. As noted earlier, net position may serve over time as a useful indicator of a government's financial position. The City's net position increased by $2.6 million from $68.6 million as of June 30, 2018, to $71.2 million as of June 30, 2019, primarily resulting from increases in current and other assets with decreases in capital assets being depreciated and were offset with liability increases in Other Post-Employment Benefits (OPEB) and pension liabilities. The largest portion of the City's net position is its investment in capital assets (e.g. land, infrastructure, building and equipment) representing 72.0%, or $51.3 million, of its total net position. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. A portion of the City's net position, $12.0 million or 16.8%, represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net position of $7.9 million or 11.2% may be used to meet the government's ongoing obligations to citizens and creditors. City of Temple City Statement of Net Position For Fiscal Year Ended Increase 2019 2018 (Decrease) Current and other assets $ 35,256,299 $ 31,257,344 $ 3,998,955 Capital assets, net 51,292,676 52,306,797 (1,014,121) Total assets 86,548,975 83,564,141 2,984,834 Deferred amounts related to pensions 2,109,892 2,480,080 (370,188) Deferred amounts related to OPEB 1,440,177 229,963 1,210,214 Total deferred outflow of resources 3,550,069 2,710,043 840,026 Current and other liabilities 2,710,075 3,211,343 (501,268) Long-term liabilities 15,270,241 13,995,432 1,274,809 Total liabilities 17,980,316 17,206,775 773,541 Deferred amounts related to pensions 622,336 439,051 183,285 Deferred amounts related to OPEB 301,747 50,095 251,652 Total deferred inflow of resources 924,083 489,146 434,937 Net position: Net investment in capital assets 51,292,676 52,306,797 (1,014,121) Restricted 11,957,258 8,518,526 3,438,732 Unrestricted 7,944,711 7,752,940 191,771 Total net position $ 71,194,645 $ 68,578,263 $ 2,616,382 6 City of Temple City Management's Discussion and Analysis June 30, 2019 ATTACHMENT A The following chart shows the comparison of the three components of net position for Fiscal Years 2018-19 and 2017-18 (in millions): 70.0 60.0 50.0 40.0 30.0 20.0 10.0 0.0 □FY17/18 ■FY 18/19 Invested in Capital Assets, Net of Related Debt $52.31 $51.29 Restricted Unrestricted Total Net Position $8.52 $7.75 $68.58 $11.96 $7.94 $71.19 Statement of Activities. Governmental activities increased the City's net pos ition by $2.6 million for FY 2018-19. The total revenue for the fiscal year is $21. 7 million, which is an increase of $0.4 million from the prior year. The total expenses decreased by $1 .2 million, at $19.1 million, from the prior year total of $20.3 million. The following table presents the comparative revenue and expense data for fiscal years ended June 30, 2019 and 2018. 7 ATTACHMENT A City of Temple City Management's Discussion and Analysis June 30, 2019 City of Temple City Statement of Changes in Net Position For Fiscal Year Ended Increase 2019 2018 (decrease) Program Revenues: Charges for services $ 3,841,190 $ 4,051,525 $ (210,335) Operating contributions and grants 5,132,393 4,751,123 381,270 Capital contributions and grants 454,608 1,295,350 (840,742) General Revenues: Taxes 11,171,563 10,717,924 453,639 Interest income 829,962 186,315 643,647 Other revenue 289,474 318,227 (28,753) Total Revenues 21,719,190 21,320,464 398,726 Expenses: General government 4,232,622 4,135,881 96,741 Community development 1,870,993 1,924,496 (53,503) Public safety 5,952,525 5,878,016 74,509 Public works 2,837,774 4,668,273 (1,830,499) Community services 4,208,894 3,659,828 549,066 Total Expenses 19,102,808 20,266,494 (1,163,686) Increase (decrease) in net position 2,616,382 1,053,970 1,562,412 Net Position -Beginning 68,578,263 67,524,293 1,053,970 Net Position -Ending $ 71,194,645 $ 68,578,263 $ 2,616,382 8 City of Temple City Management's Discussion and Analysis June 30, 2019 ATTACHMENT A Key elements of the significant revenues in FY 2018-19 are primarily because of an increase in sales taxes, motor vehicle in -lieu fee , interest income and court fines. Taxes are comprised of sales tax, property tax, franchise , transient occupancy tax and vehicle in lieu tax. Revenues by Source Year Ended June 30, 2019 Inte rest in come \ 3 .8% j / Other reven ue 1.3% ___ Cha rg es for services 17.7% ' C ontributions & g ra nt s 25.7% Expenses of the governmental activities totaled $19.1 million, which is a decrease of $1 .2 million or -5 . 7% over the prior year. Prior year's expenditures included additional Public Works expenses related to pavement resurfacing and traffic signal maintenance. Community se rvi ces ~ 22.0% "" Public w ork s ---.._ , 14.9% "· Expense by Activities Year Ended June 30, 2019 9 /G eneral government / 22.1 % Publi c safety 3 1.2% Co mmunit y dev elop me nt 9.8% City of Temple City Management's Discussion and Analysis June 30, 2019 Financial Analysis of the City's Funds ATTACHMENT A The City uses fund accounting to ensure and demonstrate compliance with finance related legal requirements. This section provides an analysis and discussion of individual funds and fund types presented in the fund financial statements. Governmental Funds. The City of Temple City's governmental funds reported a combined fund balance of $32.0 million at the end of the fiscal year. The General Fund's fund balance increased by $1.11 million after net transfers in FY 2018-19. Revenues exceeded expenditures by $1.38 million, before other financing sources/uses. Financing sources and uses netted a decrease to the Fund Balance of $269,895. Primary revenue sources for this fund are sales tax, property tax and motor vehicle in lieu. The General Fund is responsible for general services of the City. This includes public safety, public works, community development, community services and administration. The largest expenditure is for public safety, which was $5.36 million for FY 2018-19. The Proposition A Fund accounts for the City's share of additional sales tax collected in the County of Los Angeles as a result of Propositions A and is restricted to finance public transportation projects. The expenditures of $757,639 include the Dial-A-Ride operations of $526,630. The State Gas Tax Fund accounts for the revenues and expenditures of the City's proportionate share of gas tax monies collected by the State of California which are used for street construction, street maintenance and engineering, and administrative expenses. For FY 2018-19, $479,462 was spent primarily on street cleaning and maintenance. The Lighting and Landscape District Fund is for the assessments and ad valorem taxes which are used for the operation and maintenance of street lights, traffic signals and trees and parkways within the City. $1.03 million was spent maintenance and upkeep. Proprietary Funds. As noted earlier, net position may serve over time as a useful indicator of a government's financial position. In the case of the Proprietary Fund, assets exceeded liabilities by $510,000. General Fund Financial and Budgetary Highlights The General Fund is the chief operating fund of the City. The fund balance reported an increase of $1.1 million at June 30, 2019. As a measure of the General Fund's liquidity, it may be useful to compare both unassigned fund balance and total fund balance to total fund expenditures. Unassigned fund balance represents 41. 7% of total General Fund expenditures, while total fund balance represents 138.8% of that same amount. Revenues: Actual revenues received were $15.8 million and were $311,806 higher than the final budget. This increase was primarily due higher interest income and sales tax revenues. Expenditures: Actual expenditures were $14.4 million and were lower than the final budget by $1.5 million largely due to lower operations in general government and public safety, specifically in the community preservation and parking administration programs, and in capital outlay. 10 City of Temple City Management's Discussion and Analysis June 30, 2019 City of Temple City General Fund Budgetary Summary Revenues, Expenditures, and Changes in Fund Balance June 30, 2019 Budgeted Amounts Actual Ori~inal Final Amounts REVENUES Taxe~ $ 6,329,700 $ 6,559,865 $ 6,558,259 Licenses and permits 1,661,000 1,660,815 1,653,876 Intergovernmental 4,632,600 4,694,845 4,694,844 Charges for seivices 1,398,650 1,271,555 1,292,466 Interest Income 240,000 418,850 714,889 Other revenue 688,000 911,040 914,442 Total revenue 14,949,950 15,516,970 15,828,776 EXPENDITURES General government 3,903,915 4,068,844 3,832,851 Community development 1,580,280 1,504,988 1,407,580 Public safety 5,547,510 5,592,011 5,358,737 Public works 1,079,365 1,097,508 1,169,785 Community services 2,420,580 2,375,830 2,267,603 Capital outlay 774,000 1,320,365 409,149 Total expenditures 15,305,650 15,959,546 14,445,705 Excess of revenues over expenditures (355,700) (442,576) 1,383,071 OTHER FINANCING SOURCES (USES) Transfers in 87,865 87,865 87,865 Transfers out (357,?soi (357,?soi (357,?soi Total other financing sources (uses) (269,a9sl (269,a9sl (269,895) Net change in fund balance (625,595) (712,471) 1,113,176 Fund Balance at Beginning of Year 13,782,430 11,498,880 18,930,811 Fund Balance at End of Year $13,156,835 $10,786,409 $20,043,987 11 ATTACHMENT A Variance with Final Budget Positive (Neaativel $ (1,606) (6,939) (1) 20,911 296,039 3,402 311,806 235,993 97,408 233,274 (72,277) 108,227 911,216 1,513,841 1,825,647 1,825,647 7,431,931 $9,257,578 City of Temple City Management's Discussion and Analysis June 30, 2019 Capital Assets and Debt Administration ATTACHMENT A Capital Assets. As shown in the following table, as of June 30, 2019, the City of Temple City had $51.3 million invested in capital assets, including land, buildings, improvements, furniture and equipment, vehicles and infrastructure. See Note 6 for additional information. Capital Assets at Year-End Land and land rights Buildings and improvements Furniture and equipment Vehicles Infrastructure Subtotal Less Depreciation Net total, capital assets $ $ Governmental Activities 2019 15,508,348 13,805,823 1,149,296 646,562 39,531,466 70,641,495 19,348,819 51,292,676 Other Long-term liabilities. Other long-term liabilities of the City are comprised of compensated absences, net OPEB liability, and net pension liability. The net OPEB liability pertains to the unfunded status of the City's OPEB plan as of June 30, 2019. The net pension liability is based on a projection of the City's long-term share of contributions to the pension plan relative to the projected contributions of all participating employers, actuarially determined. A summary of other long-term liabilities follows: Other Long-Term Liabilities at Year-End Net OPEB obligation Compensated absences Net pension liability Total Contacting the City's Financial Management Governmental Activities $ 7,136,474 224,360 7,909,407 $ 15,270,241 This financial report is designed to provide our citizens, taxpayers, customers, investors and creditors with a general overview of the City's finances and to show the City's accountability for the money it receives. There currently are not any known facts, decisions or condition that are expected to have a significant effect on the financial position of the City. If you have any questions about this report or need additional financial information, contact the Administrative Services Department, at the City of Temple City, 9701 Las Tunas Drive, Temple City, California, 91780, (626) 285-2171. 12 GOVERNMENT-WIDE FINANCIAL STATEMENTS ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Statement of Net Position Jnne 30, 2019 ASSETS Cash and investments Accounts receivable Interest receivable Due from governmental agencies Due from Successor Agency Loans receivable Prepaid items Capital assets not being depreciated Capital assets being depreciated, net Total Assets DEFERRED OUTFLOWS OF RESOURCES Deferred amount related to pensions Deferred amount related to OPEB Total Deferred Outflows of Resources LIABILITIES Accounts payable Accrued payroll Deposits payable Miscellaneous liabilities Noncurrent liabilities: Due within one year -compensated absences Due in more than one year: Compensated abscnses Proportionate share of net pension liability Net OPEB liability Total Liabilities DEFERRED INFLOWS OF RESOURCES Deferred amounts related to pensions Deferred amounts related to OPEB Total Deferred Inflows of Resources NET POSITION Net investment in capital assets Restricted for: Education scholarship (nonspendable) Public safety Public works Community services Community development Unrestricted Total Net Position See accompanying notes to financial statements, ATTACHMENT A Governmental Activities $ 32,669,328 298,214 43,008 928,947 26,400 1,280,284 10,118 15,508,348 35,784,328 86,548,975 2,109,892 1,440,177 3,550,069 1,538,657 149,102 997,349 38 24,929 224,360 7,909,407 7,136,474 17,980,316 622,336 301,747 924,083 51,292,676 171,994 9,648 10,190,611 167,000 1,418,005 7,944,711 $ 71,194,645 13 CITY OF TEMPLE CITY, CALIFORNIA Statement of Activities Year Ended June 30, 2019 Functions/Programs Governmental Activities: General government Community development Pub! ic safety Public works Community services Total Governmental Activities Exeenses $ 4,232,622 1,870,993 5,952,525 2,837,774 4,208,894 $ 19,102,808 General Revenues: Taxes: Property taxes Program Revenues Charges Operating for Contributions Services and Grants $ 116,086 $ 1,609,882 786,821 642,185 148,748 944,665 4,121,316 528,372 75,508 $ 3,841,190 $ 5,132,393 Property taxes in lieu of motor vehicle fees Sales taxes Transient occupancy taxes Franchise taxes Other taxes Investment income State revenue ~ other Other revenue Total General Revenues Change in Net Position Net Position, Beginning of Year Net Position, End of Y car See accompanying notes to financial statements. 14 ATTACHMENT A Net (Expense) Revenue and Change in Net Position Capital Contributions Governmental and Grants Activities $ $ (4,116,536) 525,710 (5,161,592) 454,608 2,682,815 (3,605,014) $ 454,608 (9,674,617) 3,495,364 4,694,844 2,189,206 58,424 569,736 163,989 829,962 9,669 279,805 12,290,999 2,616,382 68,578,263 $ 71,194,645 FUND FINANCIAL STATEMENTS Government Fund Financial Statements Proprietmy Fund Financial Statements Fiducia,y Fund Financial Statements ATTACHMENT A GOVERNMENTAL FUND FINANCIAL STATEMENTS ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Description of Major Funds June 30, 2019 Major Governmental Funds General Fund ATTACHMENT A The General Fund has been classified as a major fund and is used to account for all of the general revenues of the City not specifically levied or collected for some special purpose, and for the expenditures related to the rendering of general services by the City. The General Fund is used to account for all resources not required to be accounted for in another fund. Nonmajor Governmental Funds Nonmajor governmental funds include the Special Revenue Funds and the Permanent Fund. Since total assets, liabilities and deferred inflows, revenues or expenditures of these funds do not exceed 10 percent of total governmental funds, they do not meet the criteria to be classified as major funds. See accompanying notes to financial statements. 15 CITY OF TEMPLE CITY, CALIFORNIA Governmental Funds Balance Sheet June 30, 2019 ASSETS Assets Cash and investments Accounts receivable Interest receivable Due from other funds Due from other governments Due from Successor Agency Prepaid items Loans receivable Total Assets LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND FUND BALANCES Liabilities Accounts payable Accrued payroll Due to other funds Refundable deposits Miscellaneous liabilities Total Liabilities Deferred Inflows of Resources Unavailable revenues Fund Balances Nonspendable Restricted Committed Assigned Unassigned Total Fund Balances Total Liabilities, Deferred Inflows of Resources and Fund Balances See accompanying notes to financial statements. ATTACHMENT A General $ 21,262,821 290,727 42,720 54,347 642,293 26,400 l 0, 118 58,875 $ 22,388,301 $ 1,250,998 149,079 884,324 38 2,284,439 59,875 68,993 3,500,000 10,455,704 6,019,290 20,043,987 $ 22,388,301 16 CITY OF TEMPLE CITY, CALIFORNIA Governmental Funds Balance Sheet June 30, 2019 Nonmajor Governmental Funds Total $ $ $ $ 10,896,474 7,487 288 286,654 1,221,409 12,412,312 287,659 23 54,347 113,025 455,054 171,994 11,785,264 11,957,258 12,412,312 $ $ $ $ 32,159,295 298,214 43,008 54,347 928,947 26,400 10,118 1,280,284 34,800,613 1,538,657 149,102 54,347 997,349 38 2,739,493 59,875 240,987 11,785,264 3,500,000 10,455,704 6,019,290 32,001,245 34,800,613 See accompanying notes to financial statements. ATTACHMENT A 17 CITY OF TEMPLE CITY, CALIFORNIA Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position Juue 30, 2019 Fund balances of governmental funds Amounts reported for governmental activities in the statement of net position are different because: Capital assets net of accumulated depreciation have not been included as financial resources in governmental fund activity. Capital assets Accumulated depreciation Long-term liabilities have not been included in the governmental funds Compensated absences Net OPEB liability Net pension liability Certain accounts and intergovernmental receivables are not available to pay for current-period expenditures and, therefore, are reflected as deferred inflows of resources in the governmental funds Deferred outflows of resources related to pensions Deferred inflows of resources related to pensions Deferred outflows of resources related to OPEB Deferred inflows of resources related to OPEB The internal service fund is used by management to charge the costs of self-insurance activities to individual funds. The cash and investments of the internal service fund are included in governmental activities in the statement of net position because it primarily services governmental activities of the City. Net position of governmental activities See accompanying notes to financial statements. 18 ATTACHMENT A $ 32,00 I ,245 70,641,495 (19,348,819) (249,289) (7,136,474) (7,909,407) 59,875 2,109,892 (622,336) 1,440, I 77 (301,747) 510,033 $ 71,194,645 CITY OF TEMPLE CITY, CALIFORNIA Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances Year Ended June 30, 2019 REVENUES Taxes Licenses and permits Intergovernmental Charges for services Fines Investment income Rental income Other Total Revenues EXPENDITURES Current: General government Community development Public safety Public works Community services Capital outlay Total Expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total Other Financing Sources (Uses) Net Changes in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year See accompanying notes to financial statements. 19 ATTACHMENT A General Fund $ 6,558,259 1,653,876 4,694,844 1,292,466 624,968 714,889 32,636 256,838 15,828,776 3,832,851 1,407,580 5,358,737 1,169,785 2,267,603 409,149 14,445,705 1,383,071 87,865 (357,760) (269,895) 1,113,176 18,930,811 $ 20,043,987 CITY OF TEMPLE CITY, CALIFORNIA Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances Year Ended June 30, 2019 Nonmajor Governmental $ $ Funds 1,497,827 4,105,344 137,916 115,073 61,008 5,917,168 245,708 140,100 1,518,204 794,095 50,224 2,748,331 3,168,837 617,760 (347,865) 269,895 3,438,732 8,518,526 11,957,258 $ $ Total 8,056,086 1,653,876 8,800,188 1,430,382 624,968 829,962 32,636 317,846 21,745,944 3,832,851 1,653,288 5,498,837 2,687,989 3,061,698 459,373 17,194,036 4,551,908 705,625 (705,625) 4,551,908 27,449,337 32,001,245 See accompanying notes to financial statements. 20 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Governmental Fuuds Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities Year Ended June 30, 2019 Net change in fund balances -total governmental funds Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. Adjustments for capital outlay and the net depreciation expense is reported in the governmental activities Revenues that are measurable but not available are deferred in the governmental funds under the modified accrual basis of accounting. Expenses reported in the statement of activities which do not require the use of current financial resources are not reported as expenditures in governmental funds. Net difference between OPEB expense recorded on the government wide statement of activities and contributions paid Net difference between pension expense recorded on the government wide statement of activities and contributions paid Compensated absences The internal service fund is not a governmental fund. However, it is used by management to charge the net cost of self insurance activities to individual funds. The net revenue of the internal service fund is reported with government activities. Change in net position of governmental activities See accompanying notes to financial statements. 21 ATTACHMENT A $ 4,551,908 (1,015,886) (81,540) (485,959) (421,820) 14,895 54,784 $ 2,616,382 PROPRIETARY FUND FINANCIAL STATEMENTS ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Description of Proprietary Fund Year Ended June 30, 2019 Internal Service Fund Selflnsurance Fund ATTACHMENT A To account for goods and services relating to insurance premiums provided by one department to other departments on a cost reimbursement basis. See accompanying notes to financial statements. 22 CITY OF TEMPLE CITY, CALIFORNIA Statement of Net Position Proprietary Fund June 30, 2019 ASSETS Current assets: Cash and investments Total Assets NET POSITION Unrestricted Total Net Position See accompanying notes to financial statements. 23 $ $ ATTACHMENT A Self Insurance Internal Service Fund 510,033 510,033 510,033 510,033 CITY OF TEMPLE CITY, CALIFORNIA Statement of Revenues, Expenses and Changes in Net Position Proprietary Fund Year Ended June 30, 2019 Operating revenues: Interfund Charges Total Operating Revenues Changes in Net Position Net Position -Beginning of the Year Net Position -End of the Year See accompanying notes to financial statements. 24 ATTACHMENT A Self Insurance Internal Service Fund $ 54,784 54,784 54,784 455,249 $ 510,033 CITY OF TEMPLE CITY, CALIFORNIA Statement of Cash Flows Prnprietary Fund Year Ended June 30, 2019 Cash flows from operating activities: Cash received for operating activities Net cash provided by operating activities Change in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year Reconciliation of operating income to net cash provided by operating activities: Operating income Net cash provided by operating activities Noncash investing. capital. and financing activities: There were no significant noncash investing, capital, and financing activities during the year ended June 30, 2019. See accompanying notes to financial statements. 25 ATTACHMENT A Self Insurance Internal Service Fund $ 54,784 54,784 54,784 455,249 $ 510,033 $ 54,784 $ 54,784 FIDUCIARY FUNDS FINANCIAL STATEMENTS ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Description of Fiduciary Fund Year Ended June 30, 2019 Successor Agency Private-Purpose Trust Fund ATTACHMENT A To account for the resources held and administered by the City of Temple City in a fiduciary capacity acting as the Successor Agency to the former Temple City Redevelopment Agency. See accompanying notes to financial statements. 26 CITY OF TEMPLE CITY, CALIFORNIA Statement of Fiduciary Net Position Jnne 30, 2019 ASSETS Cash and investments Cash with fiscal agent Total Assets LIABILITIES Accounts payable Accrued interest payable Due to City Noncurrent liabilities: Due within one year Due in more than one year Total Liabilities FIDUCIARY NET POSITION (DEFICIT) Total Net Position (Deficit) See accompanying notes to financial statements. 27 ATTACHMENT A Successor Agency Private-purpose Trust Fund $ $ 1,405,843 32,664 1,438,507 32,490 29,538 26,400 530,000 2,395,000 3,013,428 (1,574,921) CITY OF TEMPLE CITY, CALIFORNIA Statement of Changes in Fiduciary Net Position Year Ended June 30, 2019 ADDITIONS Tax increment Total Additions DEDUCTIONS Administration Interest expense and fiscal charges Total Deductions Changes in Net Position Net Position -Beginning of Year Net Position -End of Year See accompanying notes to financial statements. 28 ATTACHMENT A Successor Agency Private-purpose Trust Fund $ $ 530,605 530,605 32,750 33,504 66,254 464,351 (2,039,272) (1,574,921) ATTACHMENT A NOTESTO FINANCIAL STATEMENTS CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of the Reporting Entity ATTACHMENT A The City of Temple City, California (City) was incorporated on May 25, I 960, under the general laws of the State of California. On April 16, 1971, the City adopted resolution number 71-1084 declaring itself a chatier city. The City operates under the Council -Manager form of government. The City provides the following services as authorized by its general laws: Public Safety, Highways and Streets, Health and Sanitation, Cultural and Park Facilities, Public Improvements, Planning, Recreation and General Administrative Services. The accounting policies of the City conform to generally accepted accounting principles as applicable to governments. As required by generally accepted accounting principles, these financial statements present the government and its component units, entities for which the government is considered to be financially accountable. The City is considered to be financially accountable for an organization if the City appoints a voting majority of that organization's governing body and the City is able to impose its will on that organization or there is a potential for that organization to provide specific financial benefits to or impose specific financial burdens on the City. The City is also considered to be financially accountable if an organization is fiscally dependent (i.e., it is unable to adopt its budget, levy taxes, set rates cir charges, or issue bonded debt without approval from the City). In certain cases, other organizations are included as component units if the nature and significance of their relationship with the City are such that their exclusion would cause the City's financial statements to be misleading or incomplete. All of the City's component units are considered to be blended component units because in all cases the City Council serves as the governing board for each component unit. Blended component units, although legally separate entities, are, in substance, pati of the City's operations, therefore data from these units are reported with the interfund data of the primary government. Management of the City has operational responsibility for each component unit, as it manages the activities of each component unit in a similar manner in which it manages other of its own programs and activities. The following organization is considered to be a component unit of the City: City of Temple City Housing Authority The City of Temple City Housing Authority (Housing Authority) was established on November I, 2005, pursuant to the State of California Health and Safety Code 34200 entitled, "Housing Authority Law." The purpose of the Housing Authority is to provide safe and sanitary dwelling accommodations to persons of low income in the City. Even though it is legally separated, it is repolied as if it is pati of the City because the City Council also serves as the governing board of the Housing Authority and the City has operational responsibility of the Housing Authority. No separate financial statements are issued for the Housing Authority. Government-wide and Fund Financial Statements The government-wide financial statements (i.e., the statement of net position and the statement of activities) repmi information on all of the nonfiduciary activities of the primary government and its component units. For the most part, the effect of interfund activity has been removed from these statements, except for interfund services provided and used. The City's governmental activities are suppmied by taxes and intergovernmental revenues. 29 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) ATTACHMENT A The statement of activities demonstrates the degree to which the direct expenses of a given function or segments are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Indirect expenses are allocated based on the annual cost allocation plan. Program revenues include: (!) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and (2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds are reported as a separate column in the fund financial statements. Measurement Focus. Basis of Accounting. and Financial Statement Presentation The government-wide financial statements are rep01ted using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary funds financial statements. Revenues are recorded when earned and expenses are recorded when the liability is incurred, regardless of the timing of the related cash flows. Fiduciary funds, including the private-purpose trust fund, use the economic resources measurement focus and the accrual basis of accounting. Property taxes are recognized as revenues in the fiscal year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Amounts reported as program revenues include: 1) charges to customers or applicants for goods, services, or privileges provided, 2) operating grants and contributions and 3) capital grants and contributions, including special assessments. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes. Governmental funds financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period. For this purpose, the City considers revenues to be available if they are collected within 60 days of the end of the current fiscal period for property and sales tax, and 90 days for all other revenues. Expenditures generally are recorded when the liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. Property taxes, franchise taxes, licenses, and interest associated with the current fiscal period are all considered to be susceptible to accrual; therefore, they have been recognized as revenues of the current fiscal period. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the government. 30 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) ATTACHMENT A Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprieta1y fund's principal ongoing operations. The principal operating revenue of the Internal Service Fund is reimbursements relating to self-insurance. Operating expenses for the Internal Service Fund include the cost of insurance premiums relating to the services provided. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. Although the City's internal service fund is repmted as a proprieta1y fund in the fund financial statements, it is incorporated into governmental activities in the government-wide financial statements. Fund Types The basic accounting and repotting entity is a "fund". A fund is defined as an independent fiscal and accounting entity with a self-balancing set of accounts, recording resources, related liabilities, obligations, reserves and equities segregated for the purpose of canying out specific activities or attaining certain objectives in accordance with special regulations, restrictions or limitations. The accounting records of the City are organized on the basis of the various fund types as follows: GOVERNMENTAL FUND TYPES: General Fund The General Fund is the general operating fund of the City. All general tax revenues and other receipts that are not allocated by law or contractual agreement to some other fund are accounted for in this fund. Expenditures of this fund include the general operating expenses and capital improvement costs which are not paid through other funds. Special Revenue Funds The Special Revenue Funds are used to account for proceeds of specific revenue sources that are restricted by law or administrative action for specific purposes. Permanent Fund The Permanent Fund is used to account for financial resources that are legally restricted to the extent that only earnings, and not principal, may be used to support the City or its citizenry. Major Funds The City repotts the following major governmental fund: • General Fund -To account for all of the general revenues of the City not specifically levied or collected for some special purpose, and for the expenditures related to the rendering of general services by the City. 31 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) PROPRIETARY FUND TYPE: Internal Service Fund ATTACHMENT A The Internal Service Fund is used to account for goods and services relating to insurance premiums provided by one department to other departments on a cost reimbursement basis. The City's Internal Service Fund is the Self Insurance Fund. FIDUCIARY FUND TYPES: Successor Agency Private-purpose Trust Fund This fund is used to report the assets, liabilities and activities of the Successor Agency to the dissolved Temple City Community Redevelopment Agency. Unlike the limited reporting typically utilized for the Agency Fund, the Private-purpose Trust Fund rep01ts a Statement of Fiduciary Net Position and a Statement of Changes in Fiduciary Net Position. Cash Eqnivalents For purposes of the statement of cash flows, cash equivalents are defined as sho1t-term, highly liquid investments that are both readily convertible to known amounts of cash with maturities of three months or less at the time of purchase. Cash equivalents also represent the proprietary funds' share in the cash and investment pool of the City. Cash and Investments Cash and investments are reported in the accompanying balance sheet at fair value, except for certain certificates of deposit that are reported at cost because they are not transferable and they have terms that are not affected by changes in market interest rates. Changes in fair value that occur during a fiscal year are recognized as investment income reported for that fiscal year. Investment income includes interest earnings, changes in fair value, and any gains or losses realized upon the liquidation or sale of investments. The City pools cash and investments of all funds, except for assets held by fiscal agents. Each fund's share in this pool is displayed in the accompanying financial statements as cash and investments. Investment income earned by the pooled investments is allocated to the various funds based on each fund's average cash and investment balance, except for interest income (associated with funds not legally required to receive pooled investment income) that has been assigned to and recorded as revenue of the general fund, as provided by California Government Code Section 53647. Governmental Accounting Standards Board ("GASB") Statement No. 72, Fair Value Measurements and Application, provides guidance for determining a fair value measurement for reporting purposes, applying fair value to investments, and disclosures related to a hierarchy established by generally accepted accounting principles. The fair value hierarchy, which has three levels, is based on the valuation inputs used to measure fair value: Level I inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. 32 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended Jnne 30, 2019 NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Property Tax Calendar ATTACHMENT A The County of Los Angeles assesses, levies, and collects property taxes for the City. Property taxes levied for the year ended June 30, 20 I 9 were due and payable in two installments on November I and February I and became delinquent on December I 0th and April IO'', respectively. At the date of incorporation, the City elected to be a no/low property tax city as an incentive for current and prospective residents to reside in the City. The prope11y tax calendar is as follows: Lien Date: Levy Date Due Date: Delinquent Date: January 1 July 1 First installment -November 1 Second installment -Februaiy 1 First installment -December 10 Second installment -April 10 Taxes are collected by Los Angeles County and are remitted to the City periodically. Dates and percentages are as follows: Prepaid Items December IO Janua1y 15 April 10 May 15 July 31 30%Advance Collection No. 1 10% Advance Collection No. 2 Collection No. 3 Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both the government-wide and fund financial statements. These are accounted for using the consumption method, and accordingly, the expenditure is recorded in the period in which the goods or services are received. Capital Assets Capital assets (including infrastructure) are valued at cost where historical records are available and at an estimated historical cost where no historical records exist. Donated capital assets are valued at their acquisition value on the date received. Public domain (infrastructure) capital assets consist of streets, bridges, traffic signals, street lights, bus shelters and sewers. Generally, the City capitalizes capital asset purchases in excess of $5,000 for general capital assets, $50,000 for sewers (infrastructure) and $10,000 for all other infrastructure and an estimated useful life in excess of one year. Capital assets used in operations are depreciated over their estimated useful lives using the straight-line method in the government-wide financial statements. Provision for depreciation is charged as an expense against operations and accumulated depreciation is repo11ed on the statement of net position. The ranges of lives used for depreciation purposes for each capital asset class are as follows: 33 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended Jnne 30, 2019 NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Capital Assets (Continned) Buildings & Improvements Furniture and equipment Vehicles Infrastructure: Streets Bridges Traffic signals Deferred Outflows and Inflows of Resources 40 years 5-7 years 5 years 50-80 years 50 years 20 years ATTACHMENT A Under the modified accrual basis of accounting, it is not enough that revenue has been earned ifit is to be recognized as revenue of the current period. Revenue must also be susceptible to accrual; it must be both measurable and available to finance expenditures of the current fiscal year. If assets are recognized in connection with a transaction, but those assets are not yet available to finance expenditures of the current fiscal year, then the assets must be offset by a corresponding deferred inflow of resources. This type of deferred inflow is unique to governmental funds since it is tied to the modified accrual basis of accounting. The City repotts deferred outflows and inflows of resources. A deferred outflow of resources is a consumption of net position or fund balance by the government that is applicable to a future repotting period. A deferred inflow of resources represents an acquisition of net position or fund balance by the government that is applicable to a future period. The City repo1ts deferred outflows and inflows ofresources related to pensions and other post-employment benefits (OPEB) on the government-wide statement of net position, under full accrual basis of accounting. Refer to Note 8 and Note IO for items identified as deferred inflows and outflows related.to pensions and OPEB as of June 30, 2019. Employee Leave Benefits Vacation time begins to accumulate as of the first day of employment to a maximum of 240 hours for non- represented employees and 320 hours for represented employees. Sick leave accumulates at the rate of 8 hours per month without limit. Employees are not entitled to compensation for accrued sick time upon separation from the City. Claims and Judgments The City records a liability for material litigation,judgments, and claims (including incurred but not reported losses) when it is probable that an asset has been impaired or a material liability has been incurred prior to year-end and the probable amount ofloss (net of any insurance coverage) can be reasonably estimated. 34 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended Jnne 30, 2019 NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Pensions ATTACHMENT A For purposes of measuring the net pension liability and deferred outflows/inflows ofresources related to pensions, and pension expense, information about the fiduciary net position of the City's California Public Employees' Retirement System (CalPERS) plans and additions to/deductions from the Plans' fiduciary net position have been determined on the same basis as they are reported by CalPERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. Other Post-employment Benefits (OPEB) For the purposes of measuring the net OPEB liability and deferred outflows/inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the City's Retiree Benefits Plan (OPEB Plan) and additions to/deductions from the OPEB Plan's fiduciary net position have been determined on the same basis as they are repm1ed by the OPEB Plan. For this purpose, the OPEB Plan recognizes benefit payments when due and payable in accordance with the benefit terms. Investments are repmted at fair value, except for money market investments and pa11icipating interest-earning investment contracts that have a maturity date at the time or purchase of one year or less, which are reported at cost. Fund Balance Government Accounting Standards Board (GASB) Statement No. 54, Fund Balance Reporting and Government Fund-type Definitions, defines fund balance as the difference between the assets, liabilities and deferred inflows repo11ed in the City's governmental funds. There are generally limitations on the purpose for which all or a portion of the resources of a governmental fund may be used. The force behind these limitations can vary significantly, depending upon their source. Consequently, the fund balance repm1ed in the annual financial statements is categorized into five components whereby each component identifies the extent to which the City is bound to honor constraints on the specific purposes for which amounts in the fund can be spent. The five components of fund balance are as follows: • Nonspendable: Resources that are I) not in spendable form, such as inventories, prepayments, long-term receivables, or non-financial assets held for resale, or 2) required to be maintained intact such as an endowment. • Restricted: Resources that are subject to externally enforceable legal restrictions; these restrictions would be either 1) externally imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments or 2) imposed by law through constitutional provisions or enabling legislation. • Committed: Resources that are constrained to specific purposes by formal action approved by the City Council, which is the City's highest level of decision making authority. The formal action that is required to be taken to establish, modify, or rescind a fund balance is a resolution. The constraint remains binding unless removed in the same formal manner by the City Council. Council action to commit fund balance must occur within the fiscal reporting period while the amount committed may be determined subsequently. 35 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Yea.-Ended June 30, 2019 NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Fund Balance (Continued) ATTACHMENT A • Assigned: Resources that are constrained by the City's intent to be used for specific purposes, but that are neither restricted nor committed. The City Council delegates the authority to assign fund balance to the City Manager for purposes of reporting in the annual financial statements. This was established by the governing body in the GASB 54 Fund Balance Policy resolution adopted and approved on May 15, 2012. • Unassigned: Within the General Fund, the residual resources, either positive or negative, in excess of what can be properly classified in one of the other four fund balance categories. Within all other governmental funds, the negative residual resources in excess of what can be properly classified as nonspendable, restricted, or committed. The City considers the restricted fund balances to have been spent when an expenditure is incurred for purposes for which both unrestricted and restricted fund balance is available. When expenditures are incurred for purposes for which amounts in any of the unrestricted fund balance classifications could be used, it is the policy of the City to reduce the committed amounts first, followed by assigned amounts, and then unassigned amounts. 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. When both restricted and unrestricted resources are available for use, it is the government's policy to use restricted resources first, then unrestricted resources as they are needed. • 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 of this category. • Restricted net position -This categmy presents external restrictions imposed by creditors, grantors, contributors, laws or regulations of other governments and restrictions imposed by law through constitutional provisions or enabling legislation. • Unrestricted net position This category represents the City's net position, which is not restricted for any project or other purpose. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses, during the reporting period. Actual results could differ from those estimates. 36 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Prononncements Adopted in the Current Year ATTACHMENT A GASB Statement No. 83 -In November 2016, GASB issued Statement No. 83, Certain Asset Retirement Obligations. This Statement requires the recognition of a liability and a corresponding deferred outflows of resources associated with an asset retirement obligation based on the criteria and the measurement established in the Statement. This Statement also requires disclosure of required information about the asset retirement obligations. This Statement is effective for the fiscal year ended June 30, 2019; however, this Statement did not have any impact on the City's financial statements. GASB Statement No. 88 -In April 2018, GASB issued Statement No. 88, Certain Disclosures Related to Debt, Including Direct Borrowings and Direct Placements. The primary objective of this Statement is to improve the information that is disclosed in notes to government financial statements related to debt, including direct borrowings and direct placements. It also clarifies which liabilities governments should include when disclosing information related to debt. This Statement is effective for the fiscal year ended June 30, 2019. The City implemented this Statement effective July 1, 2018; however, this Statement did not have a material impact on the City's financial statements. Pronouncements Effective in Future Years The City is currently evaluating the potential impact of the following issued, but not yet effective, accounting standards. GASB Statement No. 84 -In January 2017, GASB issued Statement No. 84, Fiduciary Activities. The objective of this Statement is to improve guidance regarding the identification of fiduciary activities for accounting and financial repo1ting purposes and how those activities should be reported. This Statement is effective for repo1ting periods beginning after December 15, 2018. GASB Statement No. 87 -In June 2017, GASB issued Statement No. 87, Leases. The objective of this Statement is to better meet the information needs of financial statement users by improving accounting and financial reporting for leases; enhancing the comparability of financial statements between governments; and also enhancing the relevance, reliability (representational faithfulness), and consistency of information about the leasing activities of governments. This Statement is effective for reporting periods beginning after December 15, 2019. GASB Statement No. 89 -In June 2018, GASB issued Statement No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period. The objectives of this Statement are (a) to enhance the relevance and comparability of information about capital assets and the cost of borrowing for a reporting period and (b) to simplify accounting for certain interest costs. This Statement is effective for reporting periods beginning after December 15, 2019. GASB Statement No. 90 -In August 2018, GASB issued Statement No. 90, Majority Equity Interests -An Amendment ofGASB Statements No. 14 and No. 61. The objectives of this Statement are to improve the consistency and comparability of repo1ting a government's majority equity interest in a legally separate organization and to improve the relevance of financial statement information for ce1tain component units. The Statement is effective for reporting periods beginning after December 15, 2018. GASB Statement No. 91-In May 2019, GASB issued Statement No. 91, Conduit Debt Obligations. The objectives of this statement are to provide a single method of reporting conduit debt obligations by issuers and eliminate diversity in practice associated with (I) commitments extended by issuers, (2) arrangements associated with conduit debt obligations, and (3) related note disclosures. The requirements of this statement are effective for reporting periods beginning after December 15, 2020. 37 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 2-STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY Excess of Expenditures Over Appropriations Expenditures for the year ended June 30, 2019, exceeded appropriations in the following funds: Fund Final Budget Expenditures Major Funds: General Fund: Purchasing $ 249,325 $ 291,135 Building 693,918 694,165 General government buildings 292,668 370,230 Non-major Funds: Camellia Permanent Fund $ $ 260 CDBG 221,405 245,708 Park Acquisition 4,381 NOTE 3 -CASH AND INVESTMENTS ATTACHMENT A Excess $ 41,810 247 77,562 $ 260 24,303 4,381 Cash and investments at June 30, 2019 are classified in the accompanying financial statements as follows: Statement of Net Position: Cash and investments Fiducimy Fund: Cash and investments Cash with fiscal agent Total Cash and Investments Cash and investments as of June 30, 2019 consist of the following: Cash on hand Deposits with financial institutions Investments Total Cash and Investments 38 $ 32,669,328 1,405,843 32,664 $ 34 107 835 $ 2,100 3,552,823 30,552,912 $ 34,107,835 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 3 -CASH AND INVESTMENTS (CONTINUED) ATTACHMENT A Investments Authorized by the California Government Code and the City's Investment Policy The accompanying table below identifies the investment types that are authorized for the City by the California Government Code (or the City's investment policy, where more restrictive). The table also identifies certain provisions of the California Government Code (or the City's investment policy, where more restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by the bond trustee that are governed by the provisions of debt agreements of the City, rather than the general provisions of the California Government Code or the City's investment policy, Authorized Maximum Maximum Investment Types by City's Maximum Percentage Investment Authorized by State Law Policy Maturity of Pmtfolio In One Issuer Local Agency Bonds No 5 years None None U.S. Treasury Obligations Yes 5 years None None U.S. Agency Securities Yes 5 years None None State of California Obligation No 5 years None None Local Agency Obligation No 5 years None None Banker's Acceptances* No 180 days 40% 30% Commercial Paper** No 270 days 25% 10% Certificates of Deposit Yes 5 years 30% None Repurchase Agreements No I year None None Reverse Repurchase Agreements*** No 92 days 20% of base value None Medium-Term Notes Yes 5 years 30% None Mutual Funds**** No NIA 20% 10% Money Market Mutual Funds Yes N/A 20% None Collateralized Bank Deposits Yes 5 years None None Mortgage Pass-Through Securities No 5 years 20% None County Pooled Investment Funds Yes N/A None None Local Agency Investment Fund (LAIF) Yes N/A None None * No more than 30% of surplus funds may be invested in Bankers Acceptances of any one commercial bank. ** *** **** Commercial paper issuers must be U.S. Corporations with $500 million plus in assets. Purchases may not represent more than l 0% of outstanding paper of an issuing corporation. Reverse Repurchase Agreements must be made with primary dealers of the Federal Reserve Bank of New York and the securities used for the agreements must have been held by the issuer for at least 30 days. No more than 10% of the City's surplus funds may be invested in any one mutual fund. 39 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended Jnne 30, 2019 NOTE 3 -CASH AND INVESTMENTS (CONTINUED) Disclosures Relating to Interest Rate Risk ATTACHMENT A 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 pmtion of the portfolio is maturing or coming close to maturity 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, and those held by bond trustees, to market interest rate fluctuations is provided by the following table that shows the distribution of the City's investments by maturity: Remaining Maturing ( in Months) 12 Months or 12 to 60 Total Less Months State Investment Pool (LAIF) $ 7,567,092 $ 7,567,092 $ Los Angeles County Investment Pool 4,817,776 4,817,776 Medium-Term Notes 1,501,441 1,501,441 Federal Agency Securities 9,906,578 1,245,093 8,661,485 Certificates of Deposit 6,760,025 1,781,689 4,978,336 $ 30,552,912 $ 15,411,650 $ 15,141,262 The City can make withdrawals from LAIF and the Los Angeles County Investment Pool on demand. As of June 30, the weighted average maturity of the investments contained in the LAIF investment pool is approximately 8 months and for the Los Angeles County Investment Pool is approximately 54 7 days. 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 reported by Standard & Poor's, as of year-end for each investment type: Minimum Rating as of June 30, 2019 Legal Not Amount Rating AAA/AA+ AA-/A Rated State Investment Pool (LAIF) $ 7,567,092 N/A $ $ $ 7,567,092 Los Angeles County Investment Pool 4,817,776 N/A 4,817,776 Medium-Tenn Notes 1,501,441 A 501,785 999,656 Federal Agency Securities 9,906,578 N/A 9,409,279 497,299 Certificates of Deposit 6,760,025 N/A 6,760,025 $ 30,552,912 $ 9,911,064 $ 999,656 $ 19,642,192 40 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 3 -CASH AND INVESTMENTS (CONTINUED) Concentration of Credit Risk ATTACHMENT A The investment policy of the City contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code. As of June 30, 2019, the investments in any one issuer (other than U.S. Treasury Securities, mutual funds, and external investment pools) that represent 5 percent or more of the City's total investments are as follows: lssuel' Federal Home Loan Mortgage Corporation Federal Home Loan Bank Custodial Credit Risk Investment Type Federal Agency Securities Federal Agency Securities Amount $ 5,694,194 1,743,318 Percent of Portfolio 19% 6% Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that: in the event of the failure of the counterparty ( e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the City's investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits: The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The market value of the pledged securities in the collateral pool must equal at least 110 percent 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 percent of the secured public deposits. 41 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 3 -CASH AND INVESTMENTS (CONTINUED) Fair Value Classifications ATTACHMENT A Fair value measurements are categorized based on the valuation inputs used to measure fair value: Level I inputs are quoted prices in active markets for identical asset assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. Investments categorized as Level 2 are valued using the market approach and quoted market prices. Investments' fair value measurements are as follows as of June 30, 2019: Investment Type Fair Value Level 1 Level2 Level 3 Investments: Medium-Term Notes $ 1,501,441 $ $ 1,501,441 $ Federal Agency Securities 9,906,578 9,906,578 Certificates of Deposit 6,600,025 6,600,025 Total Leveled Investments 18,008,044 18,008,044 Investments: Los Angeles County lnvestment Pool 4,817,776 State Investment Pool (LAIF) 7,567,092 Non-negotiable Certificates of Deposit 160,000 Total Investment Portfolio $ 30,552,912 As of June 30, 2019, the City's investments in government sponsored entities (e.g. FHLB, FHLMC, etc.), medium- term notes and Ce1tificate of Deposit were considered Level 2 in the amount of $18,008,044. These investments are value using the market valuation approach based on quoted prices for similar assets. Investments in LAIF and LACP!F, are uncategorized as deposits and withdrawals are made on the basis of$! and not fair value. Investment in State Investment Pool The City is a voluntary pa1ticipant 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 LA!F for the entire LAIF po1tfolio (in relation to the amo1tized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LA!F, which are recorded on an amortized cost basis. Investment in County Investment Pool The Los Angeles County Pooled Investment Fund (LACP!F) is a pooled investment fund program governed by the Los Angeles County Board of Supervisors and administered by the Los Angeles County Treasurer and Tax Collector. Investments in the LACPIF are highly liquid, as deposits and withdrawals can be made at any time without penalty. The LACPIF does not impose any maximum investment limit. 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 prorated share of the fair value provided by the LACPIF for the entire LACPIF p01tfolio (in relation to the amortized cost of that po1tfolio). The balance available for withdrawal is based on the accounting records maintained by the LACPIF, which are recorded on an amortized cost basis. 42 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 4 -INTERFUND ACTIVITY ATTACHMENT A The following represents the interfund activity of the City for the year ended June 30, 2019: Due From/To Other Funds: Due from (receivable fund) Due to (payable fund) Amount General Fund Non-major Governmental Funds $ 54 347 The General Fund receivable from non-major governmental funds represents the elimination of negative cash balances in the funds. Transfers To/From Other Funds: Transfer In General Fund Nonmajor Governmental Funds Nonmajor Governmental Funds Total Transfers Out Nonmajor Governmental Funds Nonmajor Governmental Funds General Fund $ $ Amount 87,865 260,000 357,760 705,625 Transfers to/from other funds are based on the budget funding sources that the City Council approved. The City transfers monies from various funds to the General Fund for the payment of certain programs such as Air Quality Improvement program. The City also transfers monies between various funds for projects related to trees and parkways and Dial-A-Ride program. NOTE 5 -LOANS RECEIVABLE Loans receivable consist of the following at June 30, 2019: Descri tion General Fund: Low and Moderate Income Housing Temple City Chamber of Commerce Community Development Block Grant: Home Improvement Loans Total Amount $ 56,775 (A) 2,100 (B) 58,875 1,221,409 (C) $ 1,280,284 (A) During the 2008-09 fiscal year, the City issued three housing loans totaling $56,775. These loans are zero interest loans and can be deferred until the secured property is sold or changes title. (B) On April 4, 1995, the City issued a loan to the Temple City Chamber of Commerce in the amount of$13,600 with an annual payment amount of $500. (C) The City uses Community Development Block Grant funds to issue loans to low and moderate income homeowners for repairs of building and zoning code violations. These loans are low interest loans and can be deferred until the secured property is sold or changes title. The maximum amount of each loan is $25,000. 43 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended Jnne 30, 2019 NOTE 6 -CAPITAL ASSETS Capital asset governmental activity for the fiscal year ended June 30, 2019 was as follows: Balance Balance Governmental Activities: July I, 2018 Additions Deletions June 30, 2019 Capital assets not being depreciated: Land $ 4,338,704 $ $ $ 4,338,704 Land improvements 2,494,650 2,494,650 Construction in progress 209,053 209,053 Infrastructure: Land rights relating to streets 8,465,941 8,465,941 Total 15,299,295 209,053 15,508,348 Capital assets being depreciated: Buildings 7,443,169 7,443,169 Improvements 6,362,654 6,362,654 Furniture, fixtures and equipment 1,099,599 49,697 1,149,296 Vehicles 646,562 646,562 Infrastructure: Streets 35,083,585 35,083,585 Traffic signals 3,489,878 3,489,878 Bridges 958,003 958,003 Total 55,083,450 49,697 55,133,147 Less accumulated depreciation for: Buildings 2,721,371 180,478 2,901,849 Improvements 3,008,346 154,230 3,162,576 Furniture, fixtures and equipment 956,302 40,240 996,542 Vehicles 520,851 3,009 523,860 Infrastructure: Streets 8,544,378 776,254 9,320,632 Traffic signals 1,366,697 118,660 1,485,357 Bridges 958,003 958,003 Total 18,075,948 1,272,871 19,348,819 Capital assets being depreciated, net 37,007,502 (1,223,174) 35,784,328 Capital assets, net $ 52,306,797 $ (1,014,121) $ $ 51,292,676 44 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 6 -CAPITAL ASSETS (CONTINUED) Depreciation expense is charged to operations, as follows: General government Community development Public safety Public works Community services Total Depreciation Expense ~ Governmental Activities NOTE 7 -COMPENSATED ABSENCES ATTACHMENT A $ 168,480 111,729 138,304 5,492 848,866 $ 1,272,871 The following is a summary of changes in the City's long-term liabilities for the year ended June 30, 2019: Compensated absences Balance at July l, 2018 $ 264,184 Additions $ 20,554 Balance Reductions June 30, 2019 $ (35,449) $ 249,289 For the compensated absences, the general fund has been used to liquidate such amounts. NOTE 8 -DEFINED BENEFIT PENSION PLAN Due Within One Year $ 24,929 Plan Description -All qualified permanent and probationary employees are eligible to participate in the City's Miscellaneous Employee Pension Plan (Plan), a cost-sharing multiple employer defined benefit pension plan administered by the California Public Employees' Retirement System (CalPERS). Benefit provisions under the Plan are established by State statute and the City's resolution. CalPERS issues publicly available reports that include a full description of the pension plan regarding benefit provisions, assumptions and membership information that can be found on the Ca!PERS website. Classic participants (defined as eligible participants prior to January 1, 2013) are required to contribute 8 percent of their annual covered salary. New or Public Employees' Pension Reform Act of 2013 (PEPRA) patticipants ( defined as eligible employees brought into CalPERS membership for the first time on or after January l, 2013) contribute at least half the normal cost rate as determined by CalPERS. The City contributes the remaining amounts necessary to fund the benefits for its employees, using the actuarial basis adopted by the Ca!PERS Board of Administration. 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 California Public Employees' Retirement Law. 45 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 ATTACHMENT A NOTE 8 -DEFINED BENEFIT PENSION PLAN (CONTINUED) The Plans' provisions and benefits in effect at June 30, 20 l 9 are summarized as follows: Hire Date Benefit formula Benefit vesting schedule Benefit payments Retirement age Monthly benefits, as a % of eligible compensation Required employee contribution rates Required employer contribution rates Miscellaneous Plan Classic PEPRA Prior to On or after January I, 2013 January I, 2013 2.5%@55 2%@62 5 years of service 5 years of service monthly for life monthly for life 50-55 52-67 2.0% to 2.7% l.0%to 2.5% 8% 6.50% 11.42% 7.27% Contributions -Section 208 l 4 ( c) of the California Public Employees' Retirement Law requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on July 1st following notice of a change in the rate. Funding contributions for the Plan are determined annually on an actuarial basis as of June 30 by CalPERS. Beginning in fiscal year 20 l 6, CalPERS collects employer contributions for the Plan as a percentage of payroll for the normal cost po1tion as noted in the rates above and as a dollar amount for contributions toward the unfunded liability. The dollar amounts are billed on a monthly basis. The City's contributions to the pension plan were $787,740 for the year ended June 30, 2019. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions -As of June 30, 2019, the City reported a net pension liability for its proportionate share of the net pension liability of the Miscellaneous Plan in the amount of$7,909,407. The City's net pension liability for the Plan was measured as the propottionate share of the net pension liability of the collective cost-sharing plan. The City's net pension liability was measured as of June 30, 20 I 8 and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2017, rolled forward to June 30, 2018 using standard update procedures. The City's prop01tion of the net pension liability was based on a projection of the City's long-term share of contributions to the pension plan 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, 2017 and 20 I 8 was as follows: Proportion• June 30, 2017 Proportion -June 30, 2018 Change -Increase (Decrease) 46 0.08108% 0.08208% 0.00100% CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 8 -DEFINED BENEFIT PENSION PLAN (CONTINUED) ATTACHMENT A For the year ended June 30, 2019, the City recognized pension expense of $1,209,561. At June 30, 2019, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Pension contributions subsequent to measurement date Differences between expected and actual experience Changes in assumptions Changes in proportion and difference between City's contributions and proportionate share of contributions Changes in employer's proportion Net difference between projected and actual earnings on pension plan investments Total Deferred Outflows of Resources $ $ 787,740 303,470 901,696 77,884 39,102 2,109,892 Deferred Inflows of Resources $ $ 103,269 220,988 219,337 78,742 622,336 The amount of $787,740 repo1ted as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2020. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows: Year Ended June 30, 2020 $ 696,914 2021 365,477 2022 (291,435) 2023 (71,140) $ 699,816 47 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended Jnne 30, 2019 ATTACHMENT A NOTE 8 -DEFINED BENEFIT PENSION PLAN (CONTINUED) Actuarial Assumptions -The total pension liabilities in the June 30, 2017 actuarial valuations were determined using the following actuarial assumptions: Valuation Date Measurement Date Actuarial Cost Method Actuarial Assumptions Discount Rate Inflation Projected Payroll Growth Salmy Increases Investment Rate of Return Mo11ality Rate Table Miscellaneous June 30, 2017 June 30, 2018 Entty-Age Normal Cost Method 7.15% 2.50% 3.00% Varies by Entry Age and Service 7.15% Derived using CalPERS' Membership Data for all Funds All other actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study from December 2017, including updates to salary increase, mortality and retirement rates. The Experience Study report can be obtained at Cal PERS' website. Change of Assumptions -In 2018, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study and Review of Actuarial Assumptions December 2017. Discount Rate -The discount rate used to measure the total pension liability was 7.15 percent. To determine whether the municipal bond rate should be used in the calculation of the discount rate for each plan, CalPERS stress tested plans that wonld most likely result in a discount rate that would be different from the actuarially assumed discount rate. The tests revealed the assets would not run out. Therefore, the current 7.15 percent discount rate is appropriate and the use of the municipal bond rate calculation is not deemed necessary. The long-term expected discount rate of7.15 percent is applied to all plans in the Public Employees' Retirement Fund (PERF). The cash flows used in the testing were developed assuming that both members and employers will make their required contributions on time and as scheduled in all future years. The stress test results are presented in a detailed repm1 called "GASB Crossover Testing Report" that can be obtained at CalPERS website under the GASB 68 section. The long-term expected rate of return on pension plan investments was determined using a building-block method in which expected future real rates of return ( expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. In determining the long-term expected rate of return, staff took into account both short-term and long-term market return expectations as well as the expected pension fund (PERF) cash flows. Taking into account historical returns of all the Public Employees Retirement Funds' asset classes (which includes the agent plan and two cost-sharing plans or PERF A, B, and C funds), expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11-60 years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each PERF fund. The expected rate of return was set by calculating the single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equal to the single equivalent rate calculated above and rounded down to the nearest one quai1er of one percent. 48 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 8 -DEFINED BENEFIT PENSION PLAN (CONTINUED) ATTACHMENT A The table below reflects 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. Global Equity Global Fixed Income Inflation Assets Private Equity Real Estate Liquidity Asset Class Total (a) An expected inflation o/2.00% used/or this period (b) An expected inflation of 2.92% used/or this period Current Target Allocation 50.0% 28.0% 0.0% 8.0% 13.0% 1.0% 100.0% Real Return Real Return Years 1 -10 (a) Years 11 + (b) 4.80% 5.98% 1.00% 2.62% 77.00% 1.81% 6.30% 7.23% 3.75% 4.93% 0.00% -0.92% Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate -The following presents the City's propotiionate share of the net pension liability, calculated using the discount rate of 7.15 percent, as well as what the City's propotiionate share of the net pension liability would be if it were calculated using a discount rate that is I-percentage point lower (6.15 percent) or I-percentage point higher (8.15 percent) than the current rate: City's proportionate share of the net pension liability Discount Rate -l % (6.15%) $ 12,022,888 Current Discount Rate (7.15%) $ 7,909,407 Discount Rate+ l % (8.15%) $ 4,513,797 Pension Plan Fiduciary Net Position -Detailed information about the Plan's fiduciary net position is available in the separately issued CalPERS financial rep01is. NOTE 9 -LIABILITY, PROPERTY AND WORKERS' COMPENSATION PROTECTION Description of Self-Insurance Pool Pursuant to Joint Powers Agreement The City is a member of the California Joint Powers Insurance Authority ("CJPIA"). The CJPIA is composed of 117 California public entities and is organized under a joint powers agreement pursuant to California Government Code §6500 et seq. The purpose of the CJPIA is to arrange and administer programs for the pooling of self-insured losses, to purchase excess insurance or reinsurance, and to arrange for group purchased insurance for property and other lines of coverage. The California JPIA began covering claims of its members in I 978. Each member government has an elected official as its representative on the Board of Directors. The Board operates through a nine-member Executive Committee. 49 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Yeal' Ended Jone 30, 2019 ATTACHMENT A NOTE 9 -LIABILITY, PROPERTY AND WORKERS' COMPENSATION PROTECTION (CONTINUED) Self-Insurnnce Progrnms of the CJPIA Each member pays an annual contribution at the beginning of the coverage period. A retrospective adjustment is then conducted annually thereafter, for coverage years 2012-13 and prior. Coverage years 2013-14 and forward are not subject to routine annual retrospective adjustment. The total funding requirement for self-insurance programs is based on an actuarial analysis. Costs are allocated to individual agencies based on payroll and claims history, relative to other members of the risk-sharing pool. Primary Liability Program Claims are pooled separately between police and general government exposures. ( l) The payroll of each member is evaluated relative to the payroll of other members. A variable credibility factor is determined for each member, which establishes the weight applied to payroll and the weight applied to losses within the formula. (2) The first layer of losses includes incurred costs up to $30,000 for each occurrence and is evaluated as a percentage of the pool's total incurred costs within the first layer. (3) The second layer of!osses includes incurred costs from $30,000 to $750,000 for each occurrence and is evaluated as a percentage of the pool's total incurred costs within the second layer. (4) Incurred costs from $750,000 to $50 million, are distributed based on the outcome of cost allocation within the first and second loss layers. For 2018-19, the CJPlA's pooled retention is $2 million per occurrence, with reinsurance to $20 million, and excess insurance to $50 million. The CJPIA' s reinsurance contracts are subject to the following additional pooled retentions: (a) $2.5 million annual aggregate deductible in the $3 million in excess of $2 million layer, and (b) $3 million annual aggregate deductible in the $5 million in excess of $10 million layer. There is a third annual aggregate deductible in the amount of$2.5 million in the $5 million in excess of$5 million layer, however it is fully covered under a separate policy and therefore not retained by the CJPIA. The overall coverage limit for each member, including all layers of coverage, is $50 million per occurrence. Costs of covered claims for subsidence losses have a sub-limit of $40 million per occurrence. Workers' Compensation Program Claims are pooled separately between public safety (police and fire) and general government exposures. (I) The payroll of each member is evaluated relative to the payroll of other members. A variable credibility factor is determined for each member, which establishes the weight applied to payroll and the weight applied to losses within the formula. (2) The first layer of losses includes incurred costs up to $50,000 for each occurrence and is evaluated as a percentage of the pool's total incurred costs within the first layer. (3) The second layer of losses includes incurred costs from $50,000 to $100,000 for each occurrence and is evaluated as a percentage of the pool's total incurred costs within the second layer. (4) Incurred costs from $100,000 to statutmy limits are distributed based on the outcome of cost allocation within the first and second loss layers. For 2018-19, the CJPIA's pooled retention is $2 million per occurrence, with reinsurance to statutoiy limits under California Workers' Compensation Law. Employer's Liability losses are pooled among members to $2 million. Coverage from $2 million to $5 million is purchased as part of a reinsurance policy, and Employer's Liability losses from $5 million to $10 million are pooled among members. 50 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 ATTACHMENT A NOTE 9 -LIABILITY, PROPERTY AND WORKERS' COMPENSATION PROTECTION (CONTINUED) Purchased Insurance Pollution Legal Liability Insurance The City participates in the pollution legal liability insurance program which is available through the CJPIA. The policy covers sudden and gradual pollution of scheduled property, streets, and storm drains owned by the City. Coverage is on a claims-made basis. There is a $50,000 deductible. The CJPIA has an aggregate limit of $50 million for the 3-year period from July I, 2017 through July 1, 2020. Each member of the CJPIA has a $10 million sub-limit during the 3-year policy term. Property Insurance The City participates in the all-risk property protection program of the CJPIA. This insurance protection is underwritten by several insurance companies. The City's property is currently insured according to a schedule of covered property submitted by the City to the CJPIA. The City's property currently has all-risk property insurance protection in the amount of$45,101,543. There is a $10,000 deductible per occurrence except for non-emergency vehicle insurance which has a $2,500 deductible. Earthquake and Flood Insurance The City purchases earthquake and flood insurance on a portion of its property. The earthquake insurance is part of the property protection insurance program of the CJPIA. City's property currently has earthquake protection in the amount of$10,781,656. There is a deductible of5% per unit of value with a minimum deductible of$100,000. Crime Insurance The City purchases crime insurance coverage in the amount of$1,000,000 with a $2,500 deductible. The fidelity coverage is provided through the CJPIA. Special Event Tenant User Liability Insurance The City further protects against liability damages by requiring tenant users of cettain property to purchase low- cost tenant user liability insurance for certain activities on agency property. The insurance premium is paid by the tenant user and is paid to the City according to a schedule. The City then pays for the insurance. The insurance is facilitated by the CJPIA. Adequacy of Protection During the past three fiscal years, none of the above programs of protection experienced settlements or judgments that exceeded pooled or insured coverage. There were also no significant reductions in pooled or insured liability coverage in 2018-19. CJPIA premiums for fiscal year 2019 were $608,207. Since claims are paid by the CJPIA and, in effect, charged back to the City via future insurance deposits, no long-term liability for claims has been recorded. 51 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 10 -OTHER POSTEMPLOYMENT BENEFIT PLAN Plan Description ATTACHMENT A The City of Temple City Retiree Healthcare Plan ("OPEB Plan") is an agent multiple employer defined benefit healthcare plan with Public Agency Retirement Services (PARS). Benefits vary by hire date and employment status. Benefits continue to dependents, including surviving spouses. Benefits Provided Employees who retire directly from the City under CalPERS are eligible to receive health care benefits covering themselves and any qualified family members under the OPEB Plan. The City pays 100 percent of the cost of the medical insurance premiums of the retired employees and 50 percent of the cost of the medical insurance premiums of their family members. Employees retired on or after April l, 2000 receive full dental and vision premiums. Dependent coverage for dental and vision is available at the employee's expense. Surviving spouses may receive the full premium with their dependents receiving 50 percent of the premium. Employee Covered by Benefit Terms At June 30, 2018, most recent measurement date, the benefit terms covered the following employees: Inactive employees or beneficiaries currently receiving benefits payments Active employees Total Contributions 30 45 75 The City establishes rates based on an actuarially determined rate. For the year ended June 30, 2019, the City's expected contribution rate is 7.8 percent of covered-employee payroll. Employees pay the difference between the benefit they receive and the monthly premium. Net OPEB Liability The City's net OPEB liability was measured as the total OPEB liability, less the OPEB Plan's fiduciary net position. The net OPEB liability was measured as of June 30, 2018, using an actuarial valuation as of June 30, 2019. A summary of principal assumptions and methods used to determine the net OPEB liability is shown below. 52 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended Jnne 30, 2019 NOTE 10 -OTHER POSTEMPLOYMENT BENEFIT PLAN (CONTINUED) Net OPEB Liability (Continued) Actuarial Assumption -The total OPEB liability in the June 30, 2019 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement, unless otherwise specified: Actuarial Cost Method Actuarial Assumptions: Discount Rate Inflation Payroll Growth Investment Rate of Return Mmiality Mortality Improvement Medical Trend Entry-Age Normal Cost Method 4.10% 2.75% Aggregate salary increases 3% annually. Merit increases based on CalPERS 1997 - 2015 Experience Study 6.00% Based on CalPERS 1997 -2015 experience study Post-retirement mortality projected fully generational with Scale MP-2018 Non-Medicare -7.25% for 2021, decreasing to an ultimate rate of 4% in 2076 Medicare -6.3% for 2021, decreasing to an ultimate rate of 4.0% in 2076 Changes of assumptions -The discount rate of 4.10 percent used for the June 30, 2018 measurement date was decreased from 6.15 percent used for the June 30, 2017 measurement date. Expected long-term rate of return on investments of 6.00 percent used for the June 30, 2018 measurement date was decreased from 6.25 percent used for the June 30, 2017 measurement date. Discount Rate -The discount rate used to measure the total OPEB liability was 4.10 percent. The discount rate was updated based on the crossover test. The projection of cash flows used to determine the discount rate assumed that the City will contribute pay-as-you-go only. The long-term expected rate ofreturn on OPEB plan investments was determined using a building-block method in which best-estimated ranges of expected future real rates of return (expected returns, net of OPEB plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long- term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of the arithmetic real rates of return for each major asset class are summarized in the following table: Target Long-Term Expected Real Asset Class Allocation Rate of Return Global Equity 48.0% 4.82% Fixed Income 45.0% 1.47% RE!Ts 2.0% 3.76% Cash 5.0% 0.06% Total 100% 53 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended Jnne 30, 2019 ATTACHMENT A NOTE 10 -OTHER POSTEMPLOYMENT BENEFIT PLAN (CONTINUED) Changes in Net OPEB Liability Increase (Decrease) Total OPEB Plan Fiduciaiy Net OPEB Liability Net Position Liability Balance at June 30, 2018 $ 7,067,860 $ 1,377,672 $ 5,690,188 Changes in the year: Service Cost 242,691 242,691 Interest on the total OPEB liability 449,797 449,797 Differences between expected and actual experience (307,370) (307,370) Assumption changes 1,371,245 1,371,245 Contributions -employer -expected retiree benefit payments 228,197 (228,197) Net investment income 86,115 (86,115) Benefit payments (227,588) (227,588) Administrative expenses (4,235) 4,235 Net changes 1,528,775 82,489 1,446,286 Balance at June 30, 2019 $ 8,596,635 $ 1,460,161 $ 7,136,474 Sensitivity of the Net OPEB Liability to Changes in the Discount Rate -The following presents the net OPEB liability of the City, as well as what the City's net OPEB liability would be if it were calculated using a discount rate that is one percentage point lower (3.10 percent) or one percentage point higher (5.10 percent) follows: Net OPEB Liability $ 1% Decrease (3.10%) 8,692,535 Discount Rate (4.10%) $ 7,136,474 $ 1% Increase (5.10%) 5,913,121 Sensitivity of the Net OPEB Liability to Changes in the Healthcare Cost Trend Rates -The following presents the net OPEB liability of the City, as well as what the City's net OPEB liability would be if it were calculated using healthcare cost trend rates that are one percentage point lower or one percentage point higher than current healthcare cost trend rates follows: 1% Decrease Current Trend I% Increase Net OPEB Liability $ 5,823,848 $ 7,136,474 $ 8,843,476 54 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 10 -OTHER POSTEMPLOYMENT BENEFIT PLAN (CONTINUED) OPEB Expense and Deferred Inflows and Outflows of Resources Related to OPEB ATTACHMENT A For the year ended June 30, 2019, the City recognized an OPEB expense of$748,023. As of June 30, 2019, the City repo1ted deferred outflows of resources and deferred inflows ofresources related to the Plan as follows: Deferred Outflows Deferred Inflows of of Resources Resources OPEB contributions subsequent to measurement date $ 262,065 $ Changes in assumptions 1,178,112 Differences between actual and expected experience 264,078 Net difference between projected and actual earnings on plan investments 37,669 Total $ 1,440,177 $ 301,747 $262,065 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2020. Other amounts reported as deferred outflows and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: Year ended June 30, Amortization 2020 137,292 2021 137,292 2022 137,293 2023 149,818 2024 149,841 Thereafter 164,829 Total $ 876,365 55 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended Jnne 30, 2019 NOTE 11-FUND BALANCE CLASSIFICATIONS Nonmajor Governmental General Funds Totals Nonspendable Prepaid items $ 10, 118 $ $ 10,118 Educational scholarship 171,994 171,994 Loans receivable 58,875 58,875 Subtotal 68,993 171,994 240,987 Restricted Community development 1,418,005 1,418,005 Public safety 9,648 9,648 Community services 167,000 167,000 Public works 10,190,611 10,190,611 Subtotal 11,785,264 11,785,264 Committed Emergency/disasters 50,000 50,000 Liquidity 2,000,000 2,000,000 Local economic uncertainty 1,450,000 1,450,000 Subtotal 3,500,000 3,500,000 Assigned Facilities management 3,540,000 3,540,000 Technology replacement 40,792 40,792 Economic development 2,083,273 2,083,273 Opportunities for one-time expenditures 4,791,639 4,791,639 Subtotal 10,455,704 10,455,704 Unassigned 6,019,290 6,019,290 Total $ 20,043,987 $ 11,957,258 $ 32,001,245 On June 18, 2019, the City reaffirmed the committed and assigned fund balance classifications for the General Fund. At June 30, 2019, the City had committed and assigned balances as follow, in accordance with the City's adopted GASB 54 Fund Balance Policy. Committed Assigned $3,500,000 $10,455,704 Any remaining fund balance at the close of the fiscal year will be designated as Unassigned. 56 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 NOTE 12 -CONTINGENT LIABILITIES/COMMITMENTS ATTACHMENT A Various claims and suits have been filed against the City in the normal course of business. Although the outcome of these matters is not presently determinable in the opinion of legal counsel, the resolution of these matters will not have a material adverse effect on the financial condition of the City. During fiscal year 2016-17, the City agreed to contribute toward the County of Los Angeles Library expansion. The City's total commitment is $1,950,000, with $1,500,000 remaining as of June 30, 2019. NOTE 13 -SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY The accompanying financial statements also include the Private-purpose Trust Fund for the Successor Agency to the City's former Redevelopment Agency (Successor Agency). The City, as the Successor Agency, serves in a fiduciary capacity, as custodian for the assets and to wind down the affairs of the former Redevelopment Agency. Its assets are held in trust for the benefit of the taxing entities within the former Redevelopment Agency's boundaries and as such, are not available for the use of the City. Disclosures related to the certain assets and long-term liabilities of the Successor Agency are as follows: Agency's Payable to the City As of June 30, 2019, the Successor Agency owes the City $26,400 for expenses by the former redevelopment agency to suppo1t redevelopment activities. Information about the Outstanding Bonds of the Successor Agency Trust Fund TAX ALLOCATION REFUNDING BONDS, SERIES 2016 On March 31, 2016, the Successor Agency issued $2,150,000 Tax-exempt Tax Allocation Refunding Bonds and $2,240,000 Taxable Tax Allocation Refunding Bonds ("Bonds") for a total of $4,390,000. Proceeds from the sale of the Bonds will be used to refund the Refunding Bonds Series 2005. The Series 2005 bonds were originally issued to refund the Temple City Financing Authority, 1993 Revenue Bonds for the Rosemead Boulevard Redevelopment Project. The refunding resulted in an economic gain of $275,962 with a percentage savings of refunded bonds of 5.67 percent and debt service savings of$!, 154,885. The principal of the Bonds is payable commencing September I, 2016 through September 1, 2024 and interest payable is payable semiannually each March and September beginning September I, 2016. Interest rates are 2.40 percent fixed on the Tax-Exempt bonds and 3.72 percent on the Taxable bonds. The principal amount outstanding at June 30, 2019 is $2,925,000. The principal of, premium, if any, and interest on 2016 Tax Allocation Refunding Bonds shall be payable from and secured by the following: (i) a priority pledge of the tax revenues allocated to the Issuer by the County-Controller- Auditor from the Issuer's Redevelopment Obligation Payment Schedule, after amounts required for pass-through payments, including negotiated pass through payments and statutory pass-through obligations; and (ii) all funds and accounts to be held in connection with the Bonds and all investment earnings on such fund and accounts. Additionally, the City will be charged a 12% interest rate per year on overdue installments of principal with reasonable fees and expenses of the Trustee (including attorney fees and expenses). 57 CITY OF TEMPLE CITY, CALIFORNIA Notes to Financial Statements Year Ended June 30, 2019 ATTACHMENT A NOTE 13 -SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY (CONTINUED) The annual requirements for repayment of principal and interest on the bonds payable outstanding as of June 30, 2019 are as follows: Year Ending June 30, Principal 2020 $ 530,000 2021 545,000 2022 565,000 2023 580,000 2024 345,000 2025 360,000 Total $ 2,925,000 Deficit Net Position Interest $ 80,241 63,249 45,672 27,510 13,836 4,683 $ 235,191 Total $ 610,241 608,249 610,672 607,510 358,836 364,683 $ 3,160,191 As of June 30, 2019, the Successor Agency Private-Purpose Trust Fund had a deficit net position of $1,574,921. This will be reduced with future receipt of distributions from the Redevelopment Property Tax Trust Fund from the County. 58 ATTACHMENT A REQUIRED SUPPLEMENTARY INFORMATION ei deba ill y.com ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Budget and Actual Comparison General Fund General Fund -This fund has been classified as a major fund and is used to account for all of the general revenues of the City not specifically levied or collected for some special purpose, and for the expenditures related to the rendering of general services by the City. The General Fund is used to account for all resources not required to be accounted for in another fund. The budget-to-actual comparison for this fund has been presented in the accompanying financial st.atements as required supplementary information. 59 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Budgetary Comparison Schedule General Fund Year Ended June 30, 2019 Variance with Final Budget - Bud~eted Amounts Actual Positive Original Final Amounts {Nes;ative) REVENUES Taxes: Real estate transfer tax $ 200,000 $ 164,000 $ 163,989 $ (11) Sales and use tax 2,100,000 2,270,750 2,270,746 (4) Franchise tax 530,000 569,750 569,736 (14) Transient occupancy tax 60,000 60,000 58,424 (1,576) Property tax allocation -3,439,700 3,495,365 3,495,364 (I) Total taxes 6,329,700 6,559,865 6,558,259 (1,606) Licenses and permits: Business license fees 200,000 200,000 192,947 (7,053) Building permit fees 950,000 868,820 869,037 217 Parking permit fees 85,000 85,000 80,355 (4,645) Encroachment permit fees 160,000 192,360 192,360 Animal license fees 43,000 43,000 41,318 (1,682) Vehicle impound fees 11,000 11,000 17,217 6,217 Temp parking permit fees 142,000 202,325 202,335 10 Code enforcement fees 70,000 58,310 58,307 (3) Tota! licenses and permits 1,661,000 1,660,815 1,653,876 {6,939) Intergovernmental: In lieu vehicle license fees 4,632,600 4,694,845 4,694,844 (I) Total intergovernmental 4,632,600 4,694,845 4,694,844 (1) Charges for services: Shared maintenance charges 4,350 4,350 4,350 Zoning fees 137,000 154,265 154,307 42 Recreation fees 566,300 506,300 528,371 22,071 Plan check fees 570,000 472,640 472,641 1 Facility rental fees 54,000 54,000 56,952 2,952 PW/Engineering fees 67,000 80,000 75,845 {4,155) Total charges for services 1,398,650 1,271,555 1,292,466 20,911 Fines, forfeitures and penalties: Court fines 475,000 624,970 624,968 (2) Investment income: Interest ~ Securities 97,000 122,835 122,832 (3) Interest ~ Others 20,000 237,595 257,909 20,314 Interest ~ CD 123,000 58,420 94,970 36,550 Change in value of investment 239,178 239,178 Total investment income 240,000 418,850 714,889 296,039 Other: AB939 reimbursement 15,000 15,000 9,669 (5,33 I) Recyclable revenue 25,000 9,155 9,156 1 Rental income 24,000 34,000 32,636 (1,364) Other reimbursement 100,000 178,915 182,754 3,839 Donation 12,000 12,000 9,200 (2,800) Sundry 2,000 2,000 4,596 2,596 CRA/LLD reimbursement 35,000 35,000 41,463 6,463 Total other income 213,000 286,070 289,474 3,404 Total revenues 14,949,950 15,516,970 15,828,776 311,806 60 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Budgetary Comparison Schedule General Fund Year Ended June 30, 2019 Variance with Final Budget~ Budgeted Amounts Actual Positive Original Fina! Amounts (Negative) EXPEND !TURES General government: City council $ 180,870 $ 180,870 $ 160,185 $ 20,685 City manager 982,545 1,122,545 993,544 129,001 City clerk 330,740 333,553 325,660 7,893 Accounting 612,700 617,013 610,186 6,827 City attorney 320,000 331,090 33!,087 3 Support services 152,780 153,405 129,651 23,754 Insurance benefits 1,074,955 1,081,043 991,403 89,640 Purchasing 249,325 249,325 291,135 (41,810) Total general government 3,903,915 4,068,844 3,832,851 235,993 Community development: Planning 823,000 778,375 681,890 96,485 Housing 32,445 32,695 31,525 1,170 Building 724,835 693,918 694,165 (247) Total community development 1,580,280 1,504,988 1,407,580 97,408 Public safety: Law enforcement 4,471,375 4,491,500 4,406,452 85,048 Traffic engineering 37,700 37,763 34,331 3,432 Emergency services 159,135 160,010 144,346 15,664 Community preservation 539,180 561,180 495,381 65,799 Parking administration 340,120 341,558 278,227 63,331 Total public safety 5,547,510 5,592,01 I 5,358,737 233,274 Public works: Parking facilities 102,425 103,550 100,157 3,393 Administration & engineering 697,290 701,290 699,398 1,892 General government buildings 279,650 292,668 370,230 (77,562) Total public works 1,079,365 1,097,508 1,169,785 (72,277) Community services: Recreation/human services 1,289,120 1,248,495 1,185,020 63,475 Parks ~ maintenance/facilities 1,131,460 1,127,335 1,082,583 44,752 Total community services 2,420,580 2,375,830 2,267,603 108,227 Capital outlay 774,000 1,320,365 409,149 911,216 Total expenditures 15,305,650 15,959,546 14,445,705 1,513,841 Excess (deficiency) of revenue over expenditures (355,700) (442,576) 1,383,071 1,825,647 OTHER FINANCING SOURCES (USES) Transfers in 87,865 87,865 87,865 Transfers out (357,760) (357,760) (357,760) Total other financing sources (uses) (269,895) (269,895) (269,895) Net change in fund balances (625,595) (712,471) 1,113,176 1,825,647 Fund Balance at Beginning of Year 13,782,430 11,498,880 18,930,811 7,431,931 Fund Balance at End of Year $ 13,156,835 $ 10,786,409 $ 20,043,987 $ 9,257,578 61 CITY OF TEMPLE CITY, CALIFORNIA Notes to Budgetary Comparison Schedule Year Ended June 30, 2019 NOTE I -BUDGETS AND BUDGETARY ACCOUNTING ATTACHMENT A The City adopts an annual budget prepared on the modified accrual basis for all of its governmental funds except Parking Concession and Affordable Housing fund. The City Manager or his designee is authorized to transfer budgeted amounts between the accounts of any program. Revisions that alter the total appropriations of any program or fund are approved by the City Council. Prior year appropriations lapse unless they are appropriated through the formal budget process. Expenditures may not legally exceed appropriations at depaiiment level. Reserves for encumbrances are not recorded by the City. 62 CITY OF TEMPLE CITY, CALIFORNIA Schedule of Proportionate Share of the Net Pension Liability Last Ten Years* As of June 30, 2019 2019 2018 Proportion of the net pension liability 0.08208% 0.08108% Proportionate share of the 11et pension liability $ 7,909,407 $ 8,041,060 Covered payroll 3,534,081 3,324,680 Proportionate share of the net pension liability as a percentage of covered payroll 223.80% 241.86% Plan fiduciary net position as a percentage ofthe total pension liability 75.30% 73.31% Notes to Schedule: • Fiscal year 2015 was the 1st year of implementation . ATTACHMENT A 2017 2016 2015 0.08004% 0.08021% 0.06544% $ 6,925,534 $ 5,505,224 $ 4,072,235 2,952,148 2,785,261 2,820,374 234.59% 197.66% 144.39% 74.06% 78.40% 79.82% Changes of Ass11111plimi The disco11nt rate changed from 7.65 percent used for the June 30, 2016 measurement date to 7 .15 percent used for the June 30, 2017 measurement date. 63 CITY OF TEMPLE CITY, CALIFORNIA Schedule of Contributions Last Ten Years* As of June 30, 2019 Actuarially determined contributions Contributions in relation to the actuarially determined contributions Contribution deficiency (excess) Covered payroll Contributions as a percentage of covered payroll Notes to Schedule: * Fiscal year 2015 was the 1st year of implementation. 2019 2018 $ 787,740 $ 700,176 787,740 700,176 $ $ $ 3,454,883 $ 3,534,081 22.80% 19.81% 64 ATTACHMENT A 2017 2016 2015 $ 629,063 $ 556,380 $ 444,577 629,063 556,380 444,577 $ $ $ $ 3,324,680 $ 2,952,148 $ 2,785,261 18.92% 18.85% 15.96% CITY OF TEMPLE CITY, CALIFORNIA Schedule of Changes in the Net OPEB Liability Last Ten Yeal's* As of June 30, 2019 Total OPEB Liability Service cost Interest on the total OPEB liability Differences between actual and expected experience Changes in assumptions Benefit payments, including refunds of employee contributions Implicit rate subsidy fulfilled Net change in total OPEB liability Total OPEB liability-beginning Total OPEB liability -ending (a) Plan fiduciary net position Contributions• employer expected retiree benefit payments Contributions -employer implicit subsidy Net investment income Benefit payments Implicit rate subsidy fulfilled Administrative expenses Net change in plan fiduciary net position Plan fiduciary net position -beginning Plan fiduciary net position -ending (b) Net OPEB liability -ending (a)-(b) Plan fiduciary net position as a percentage of the total OPEB liability Covered-employee payroll Net OPEB liability as percentage of covered-employee payroll Notes to Schedule: * -Fiscal year 2018 was the !st year of implementation. 65 $ $ $ $ $ ATTACHMENT A 2019 2018* 242,691 $ 228,759 449,797 422,018 (307,370) 1,371,245 (227,588) (172,603) (40,290) 1,528,775 437,884 7,067,860 6,629,976 8,596,635 $ 7,067,860 228,197 $ 172,603 40,290 86,115 133,506 (227,588) (172,603) (40,290) (4,235) (7,413) 82,489 126,093 1,377,672 1,251,579 1,460,161 1,377,672 7,136,474 $ 5,690,188 16.99% 19.49% 3,302,589 $ 2,809,688 216.09% 202.52% CITY OF TEMPLE CITY, CALIFORNIA Schedule of OPEB Contributions Last Ten Years* As of June 30, 2019 Actuarially determined contribution Contributions in relation to the actuarially determined contributions Contribution deficiency ( excess) Covered-employee payroll Contributions as a percentage of covered-employee payroll Notes to Schedule Valuation date: Methods and assumptions used to determine contribution rates: Actuarial cost method Amortization method Amo1tization period Asset valuation method Inflation 6/30/2019 Entry Age Normal Cost Method Level percent of payroll 21-year fixed period Market value 2.75% $ $ ATTACHMENT A 2019 2018* 726,000 $ 311,743 (262,065) (229,963) 463,935 $ 81,780 3,340,220 3,302,589 7.85% 6.96% Medical trend Mortality Non-Medicare -7 .25% for 202 l, decreasing to an ultimate rate of 4% in 2076 Medicare-6.3% for 2021, decreasing to an ultimate rate of 4% in 2076 CalPERS 1997-2015 experience study Mortality improvement Post-retirement mortality projected fully generational with Scale MP-2018 * -Fiscal year 2018 was the 1st year of implementation. 66 ATTACHMENT A SUPPLEMENTARY INFORMATION ei deba illy.com NONMAJOR GOVERNMENTAL FUNDS ATTACHMENT A ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Governmental Funds Combining Balance Sheet June 30, 2019 Special Camelia Revenue Permanent Funds Fund Totals ASSETS Cash and investments $ 10,724,768 $ 171,706 $ 10,896,474 Accounts receivable 7,487 7,487 Interest receivable 288 288 Loans receivable 1,221,409 1,221,409 Due from other governments 286,654 286,654 Prepaid items Total Assets $ 12,240,318 $ 171,994 $ 12,412,312 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ 287,659 $ $ 287,659 Accrued payroll 23 23 Due to other funds 54,347 54,347 Refundable deposits 113,025 113,025 Total Liabilities 455,054 455,054 Fund balances: Nonspendable 171,994 171,994 Restricted I 1,785,264 11,785,264 Total Fund Balances 11,785,264 171,994 11,957,258 Total Liabilities and Fund Balances $ 12,240,318 $ 171,994 $ 12,412,312 67 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Governmental Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances Year Ended June 30, 2019 Special Camelia Revenue Permanent Funds Fund Totals REVENUES Taxes $ 1,497,827 $ $ 1,497,827 Intergovernmental 4,105,344 4,105,344 Charges for services 137,916 137,916 Fines Investment income 113,969 1,104 115,073 Other 61,008 61,008 Total Revenues 5,916,064 1,104 5,917,168 EXPENDITURES Current: Community development 245,708 245,708 Public safety 140,100 140,100 Public works 1,518,204 1,518,204 Community services 793,835 260 794,095 Capital outlay 50,224 50,224 Total Expenditures 2,748,071 260 2,748,331 Excess (Deficiency) of Revenues Over (Under) Expenditures 3,167,993 844 3,168,837 OTHER FINANCING SOURCES (USES) Transfers in 617,760 617,760 Transfers out (347,865) (347,865) Total Other Financing Sources (Uses) 269,895 269,895 Net Change in Fund Balances 3,437,888 844 3,438,732 Fund Balances at Beginning of Year 8,347,376 171,150 8,518,526 Fund Balances at End of Year $ 11,785,264 $ 171,994 $ 11,957,258 68 ATTACHMENT A NONMAJOR SPECIAL REVENUE FUNDS CITY OF TEMPLE CITY, CALIFORNIA Description of Nonmajor Special Revenne Fnnds Jnne 30, 2019 ATTACHMENT A The following Special Revenue Funds have been classified as nonmajor funds in the accompanying financial statements: Citizens Option for Public Safety (COPS) Fund -To account for the revenues received from the California Department of Justice to be restricted to enhance existing law enforcement services. Public Transportation -Proposition A Fund -To account for the City's share of additional sales tax collected in the County of Los Angeles as a result of Proposition A. The fund is restricted to finance public transportation projects. Public Transportation -Proposition C Fund -To account for the City's share of additional sales tax collected in the County of Los Angeles as a result of Proposition C. The fund is restricted to finance public transportation projects. Used Oil Fund-To account for the revenues and expenditures of the Used Oil Recycling Block Grant. State Gas Tax Fund -To account for the revenues and expenditures of the City's propo1tionate share of gas tax monies collected by the State of California which are used for street construction, street maintenance and engineering, and administrative expenses. Traffic Congestion Relief Sect. 2182 Fund -To account for revenues and expenditures related to Traffic Congestion Relief Program, pursuant to Section 2182 of the Street and Highways Code. CDBG Fund -To account for resources in managing the different programs under the Community Development Block Grant funded by the U.S. Department of Housing and Urban Development. Air Quality Improvement District Fund To account for the City's share of automobile registration fees collected from the State and distributed to the City by the South Coast Air Quality Management District. The funds are used to improve transportation systems and reduce the reliance on private vehicles. Measure R Fund-These are similar to local return type funds to be used for traffic relief and transportation upgrades citywide over the next 30 years. These funds may be for projects such as pothole repairs, major street resurfacing, left-turn signals, bikeways, pedestrian improvements, streetscapes, traffic signal synchronization, local transit services and programs. Parking Concession Fund -To account for revenues and expenditures related to the operation of the parking concession agreements. Affordable Housing Fee Fund An optional development impact fee used on City approved affordable housing programs geared towards assisting low-income households (e.g. handy worker grant, home improvement loan, Brush with Kindness grant, senior housing development, first-time homebuyers program, etc.). Sewer Reconstruction Fund To account for special fees collected to be used for new sewer lines and sewer line replacement. Road Maintenance Rehab Act (RMRA) Fund This fund was established to account for revenues received under the passage of Senate Bill I (SB-1) which is known as the Road Repair and Accountability Act of 2017. Revenues collected in the fund will be utilized on future road maintenance projects. 1992/1996 Park Bond Fund To account for revenues received from the Los Angeles County Regional Park and Open Space Grant. This grant was approved November 3, 1992 and November 5, 1996 to benefit property through the improvement of neighborhood parks and recreation facilities for youth and senior citizens. 69 CITY OF TEMPLE CITY, CALIFORNIA Description of Nonmajor Special Revenue Funds June 30, 2019 ATTACHMENT A Measure M Fund -This fund was established to account for revenues under the passage of Measure M approved by the voters of Los Angeles County on November 2016 to improve transp01tation and ease traffic congestion for the Measure M Local Return (LR) program. This program is funded by the Measure M sales tax with no sunset, beginning on July 1, 2017. Park Acguisition Fund -To account for City imposed fees from the construction of new dwellings within the City. Expenditures are for the acquisition or improvement of neighborhood or community parks in conformance with the priorities established by the General Plan. Lighting and Landscape District Fund -To account for assessments and ad valorem taxes which are used for the operation and maintenance of street lights, traffic signals, and trees and parkways within the City. Public Art Fee Fund -An optional development impact fee used to procure, commission, install and/or maintain art in a public place. The impact fee could be identified for an individual art piece per the development agreement. If the development agreement does not specify a particular art piece for the impact fee, it shall be deposited into the City's Public A1t Fund. 70 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Funds Combining Balance Sheet June 30, 2019 Public Public Transportation Transportation COPS Prop A PropC ASSETS Cash and investments $ 32,998 $ 1,238,184 $ 1,759,584 Accounts receivable 7,227 Loans receivable Due from other governments Total Assets $ 32,998 $ 1,245,411 $ 1,759,584 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ 23,350 $ 64,047 $ Accrued payroll Due to other funds Refundable deposits Total Liabilities 23,350 64,047 Fund balances: Restricted 9,648 l,181,364 1,759,584 Total Fund Balances 9,648 1,181,364 1,759,584 Total Liabilities and Fund Balances $ 32,998 $ 1,245,411 $ 1,759,584 71 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fnnds Combining Balance Sheet Jnne 30, 2019 Used Oil $ 15,561 $ 15,561 $ 7,413 7,413 8,148 8,148 $ 15,561 $ $ $ $ State Gas Tax 503,056 503,056 52,590 52,590 450,466 450,466 503,056 $ $ $ $ Traffic Cong Relief Section 2182 83,387 83,387 83,387 83,387 83,387 72 $ $ $ $ COBO 1,221,409 91,872 1,313,281 37,524 54,347 91,871 1,221,410 1,221,410 1,313,281 $ $ $ ATTACHMENT A Air Quality Improvement District 176,203 12,244 188,447 188,447 188,447 $ 188,447 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenne Funds Combining Balance Sheet June 30, 2019 ASSETS Cash and investments Accounts receivable Loans receivable Due from other governments Total Assets LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Accrued payroll Due to other funds Refundable deposits Total Liabilities Fund balances: Restricted Total Fund Balances Total Liabilities and Fund Balances Measure R $ 1,043,109 $ 1,043,109 $ 1,043,109 1,043,109 $ 1,043,109 73 ATTACHMENT A Parking Affordable Concession Housing $ I 0,000 $ 157,000 $ I 0,000 $ 157,000 $ $ 10,000 157,000 10,000 157,000 $ 10,000 $ 157,000 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Funds Combining Balance Sheet June 30, 2019 Sewer Reconstruction $ 974,171 $ 974,171 $ 974,171 974,171 $ 974,171 $ $ $ $ Road Maintenance Rehab Act 737,540 119,167 856,707 7,036 7,036 849,671 849,671 856,707 $ $ $ $ 1992/1996 Park Bond Measure M $ 717,984 $ 717,984 $ 3,836 3,836 714,148 714,148 $ 717,984 74 $ $ $ $ ATTACHMENT A Park Acquisition 109,802 109,802 109,802 109,802 109,802 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Funds Combining Balance Sheet June 30, 2019 Lighting and Landscape District Public Art Fee Total ASSETS Cash and investments $ 2,933,744 $ 232,445 $ 10,724,768 Accounts receivable 260 7,487 Loans receivable 1,221,409 Due from other governments 63,371 286,654 Total Assets $ 2,997,375 $ 232,445 $ 12,240,318 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ 91,863 $ $ 287,659 Accrued payroll 23 23 Due to other funds 54,347 Refundable deposits 113,025 113,025 Total Liabilities 91,886 113,025 455,054 Fund balances: Restricted 2,905,489 119,420 11,785,264 Total Fund Balances 2,905,489 119,420 11,785,264 Total Liabilities and Fund Balances $ 2,997,375 $ 232,445 $ 12,240,318 75 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances Year Ended June 30, 2019 Public Public Transpottation Transportation COPS Prop A Prop C REVENUES Taxes $ $ $ Intergovernmental 148,747 730,549 605,970 Charges for services 43,916 Investment income 617 14, !03 26,046 Others Total Revenues 149,364 788,568 632,016 EXPENDITURES Current: Community development Public safety 140,I00 Public works Community services 757,639 Capital outlay Total Expenditures 140,100 757,639 Excess (Deficiency) of Revenues Over (Under) Expenditures 9,264 30,929 632,016 OTHER FINANCING SOURCES (USES) Transfers in 260,000 Transfers out (260,000) Total Other Financing Sources (Uses) 260,000 (260,000) Net Change in Fund Balances 9,264 290,929 372,016 Fund Balances at Beginning of Year 384 890,435 1,387,568 Fund Balances at End of Year $ 9,648 $ I,181,364 $ 1,759,584 76 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances Year Ended Juue 30, 2019 Traffic ATTACHMENT A Air Quality State Cong Relief Improvement Used Oil Gas Tax Section 2182 CDBG District $ $ $ $ $ 10,024 702,585 41,061 170,200 47,227 6,211 958 2,952 61,008 10,024 708,796 42,019 231,208 50,179 245,708 9,337 479,462 36,196 9,337 479,462 245,708 36,196 687 229,334 42,019 (14,500) 13,983 (6,000) (38,270) (6,000) (38,270) 687 223,334 42,019 (14,500) (24,287) 7,461 227,132 41,368 1,235,910 212,734 $ 8,148 $ 450,466 $ 83,387 $ 1,221,410 $ 188,447 77 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenne Fonds Combining Statement of Revenues, Expenditures and Changes in Fund Balances Year Ended June 30, 2019 Parking Measure R Concession REVENUES Taxes $ $ Intergovernmental 454,608 Charges for services Investment income 12,531 Others Total Revenues 467,139 EXPENDITURES Current: Community development Public safety Public works Community services Capital outlay Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures 467,139 OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total Other Financing Sources (Uses) Net Change in Fund Balances 467,139 Fund Balances at Beginning of Year 575,970 10,000 Fund Balances at End of Year $ 1,043,109 $ 10,000 78 ATTACHMENT A Affordable Housing $ 157,000 $ 157,000 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenne Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances Year Ended June 30, 2019 Road Sewer Maintenance 1992/1996 Reconstruction Rehab Act Park Bond Measure M $ $ $ $ $ 667,712 14,500 512,161 55,000 7,562 7,382 55,000 675,274 14,500 519,543 39,578 3,606 39,578 3,606 55,000 635,696 14,500 515,937 (14,500) (14,500) 55,000 635,696 515,937 919,171 213,975 198,211 $ 974,171 $ 849,671 $ $ 714,148 $ 79 ATTACHMENT A Park Acquisition 39,000 39,000 4,381 7,040 11,421 27,579 27,579 82,223 109,802 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances Year Ended June 30, 2019 Lighting and Landscape District Public Art Fee Total REVENUES Taxes $ 1,497,827 $ $ 1,497,827 Intergovernmental 4, l 05,344 Charges for services 137,916 Investment income 35,607 113,969 Others 61,008 Total Revenues 1,533,434 5,916,064 EXPENDITURES Current: Community development 245,708 Public safety 140,100 Public works 1,025,024 1,518,204 Community services 793,835 Capital outlay 50,224 Total Expenditures 1,025,024 2,748,071 Excess (Deficiency) of Revenues Over (Under) Expenditures 508,410 3,167,993 OTHER FINANCING SOURCES {USES) Transfers in 357,760 617,760 Transfers out (29,095) (347,865) Total Other Financing Sources (Uses) 328,665 269,895 Net Change in Fund Balances 837,075 3,437,888 Fund Balances at Beginning of Year 2,068,414 119,420 8,347,376 Fund Balances at End of Year $ 2,905,489 $ 119,420 $ 11,785,264 80 ATTACHMENT A SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -BUDGET AND ACTUAL CITY OF TEMPLE CITY, CALIFORNIA Budgetary Comparison Schedule Permanent Fund Year Ended June 30, 2019 REVENUES Investment income Total Revenues EXPENDITURES Current: Community services Total Expenditures Net Change in fund balances Fund Balance at Beginning of Year Fund Balance at End of Year $ $ Budgeted Amounts Original Final 500 $ 500 500 $ 81 ATTACHMENT A Variance with Final Budget - Actual Positive Amounts (Negative) 500 $ 1,104 $ 604 500 1,104 604 260 (260) 260 (260) 500 844 $ 344 171,150 $ 171,994 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenne Fund Schedule of Revenues, Expenditures and Changes in Fund Balance -Budget and Actual COPS Fund Year Ended June 30, 2019 Budgeted Amounts REVENUES Intergovernmental Investment income Total Revenues EXPENDITURES Current: Public safety Total Expenditures Net Change in fund balances Fund Balance at Beginning of Year Fund Balance at End of Year $ $ Original Final 140,000 $ 140,000 100 100 140,000 140,000 140,100 140,100 140,100 140,100 (100) $ (100) 82 ATTACHMENT A Variance with Final Budget - Actual Positive Amounts (Negative) $ 148,747 $ 8,747 617 517 149,364 9,364 140,100 140,100 9,264 $ 9,364 384 $ 9,648 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fuud Schedule of Revenues, Expenditures and Changes in Fund Balance -Budget and Actual Public Transportation -Prop A Fund Year Ended June 30, 2019 Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) REVENUES Intergovernmental $ 730,550 $ 730,550 $ 730,549 $ (1) Charges for services 43,920 43,920 43,916 (4) Investment income 5,500 5,500 14,103 8,603 Total Revenues 779,970 779,970 788,568 8,598 EXPENDITURES Current: Community services 778,295 796,483 757,639 38,844 Total Expenditures 778,295 796,483 757,639 38,844 Excess ( deficiency) of revenue over Expenditures 1,675 (16,513) 30,929 47,442 OTHER FINANCING SOURCES (USES) Transfers in 260,000 260,000 Total Other Financing Sources (Uses) 260,000 260,000 Net Change in fund balances $ 1,675 $ 243,487 290,929 $ 47,442 Fund Balance at Beginning of Year 890,435 Fund Balance at End of Year $ 1,181,364 83 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fnnd Schedule of Revennes, Expenditures and Changes iu Fuud Balance -Budget aud Actual Public Transportation -Prop C Fund Year Ended June 30, 2019 Budgeted Amounts Original Final REVENUES Intergovernmental $ 605,970 $ 605,970 Investment income 26,045 26,045 Total Revenues 632,015 632,015 OTHER FINANCING SOURCES (USES) Transfers out (260,000) Total Other Financing Sources (Uses) (260,000) Net Change in fund balances $ 632,015 $ 372,015 Fund Balance at Beginning of Year Fund Balance at End of Year 84 ATTACHMENT A Variance with Final Budget - Actual Positive Amounts (Negative) $ 605,970 $ 26,046 632,016 (260,000) (260,000) 372,016 $ 1,387,568 $ 1,759,584 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fund Schedule of Revenues, Expenditures and Changes in Fund Balance -Budget and Actual Used Oil Fund Year Ended June 30, 2019 Budgeted Amounts Original Final REVENUES Intergovernmental Total Revenues EXPENDITURES Current: Public Works Total Expenditures Net Change in fund balances Fund Balance at Beginning of Year Fund Balance at End of Year $ $ 10,000 $ 10,000 $ 10,000 10,000 9,000 9,340 9,000 9,340 1,000 $ 660 $ 85 Actual Amounts ATTACHMENT A Variance with Final Budget - Positive (Negative) 10,024 ...;$;;.._ __ ...;2c.;4_ 10,024 24 9,337 3 9,337 3 687 $ 27 7,461 8,148 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenne Fund Schedule of Revenues, Expenditures and Changes in Fund Balance -Budget and Actual State Gas Tax Fund Year Ended Jnne 30, 2019 Variance with Final Budget• Budgeted Amounts Actual Positive Original Final Amounts (Negative) REVENUES Intergovernmental $ 731,650 $ 731,650 $ 702,585 $ (29,065) Investment income 1,500 1,500 6,211 4,71 I Total Revenues 733,150 733,150 708,796 (24,354) EXPENDITURES Current: Public works 482,255 483,630 479,462 4,168 Total Expenditures 482,255 483,630 479,462 4,168 Excess (deficiency) of revenue over Expenditures 250,895 249,520 229,334 (20, I 86) OTHER FINANCING SOURCES (USES) Transfers out (6,000) (6,000) (6,000) Total Other Financing Sources (Uses) (6,000) (6,000) (6,000) Net Change in fund balances $ 244,895 $ 243,520 223,334 $ (20,186) Fund Balance at Beginning of Year 227,132 Fund Balance at End of Year $ 450,466 86 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fund Schedule of Revenues, Expenditures and Changes in Fund Balance -Budget and Actual Traffic Congestion Relief -Section 2181 Year Ended June 30, 2019 Budgeted Amounts Original Final REVENUES Intergovernmental $ 41,060 $ 41,060 Investment income Total Revenues 41,060 41,060 Net Change in fund balances $ 41,060 $ 41,060 Fund Balance at Beginning of Year Fund Balance at End of Year 87 ATTACHMENT A Variance with Final Budget - Actual Positive Amounts (Negative) $ 41,061 $ 958 958 42,019 959 42,019 $ 959 41,368 $ 83,387 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fund Schedule of Revenues, Expenditures and Changes in Fund Balance -Budget and Actual CDBG Fund Year Ended June 30, 2019 Bud~eted Amounts REVENUES Intergovernmental Other Total Revenues EXPENDITURES Current Community development Total Expenditures Excess ( deficiency) of revenue over Expenditures Net Change in fund balances Fund Balance at Beginning of Year Fund Balance at End of Year $ $ Original Final 191,405 $ 191,405 30,000 30,000 221,405 221,405 179,000 221,405 179,000 221,405 42,405 42,405 $ 88 ATTACHMENT A Variance with Final Budget - Actual Positive Amounts (Negative) $ 170,200 $ (21,205) 61,008 31,008 231,208 9,803 245,708 (24,303) 245,708 (24,303) (14,500) (14,500) (14,500) $ (14,500) 1,235,910 $ 1,221,410 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fuud Schedule of Revenues, Expenditures and Changes in Fund Balance -Budget and Actual Air Quality Improvement District Fund Year Ended June 30, 2019 Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Nel!ative) REVENUES Intergovernmental $ 47,000 $ 47,000 $ 47,227 $ 227 Investment income 400 400 2,952 2,552 Total Revenues 47,400 47,400 50,179 2,779 EXPENDITURES Current: Community services 37,000 37,000 36,196 804 Total Expenditures 37,000 37,000 36,196 804 Excess (deficiency) of revenue over Expenditures 10,400 10,400 13,983 3,583 OTHER FINANCING SOURCES (USES) Transfers out (38,270) (38,270) (38,270) Total Other Financing Sources (Uses) (38,270) (38,270) (38,270) Net Change in fund balances $ (27,870) $ (27,870) (24,287) $ 3,583 Fund Balance at Beginning of Year 212,734 Fund Balance at End of Year $ 188,447 89 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenne Fnnd Schednle of Revennes, Expenditnres and Changes in Fund Balance -Budget and Actual Measure R Fnnd Year Ended June 30, 2019 REVENUES Intergovernmental Investment income Total Revenues Net Change in fund balances Fund Balance at Beginning of Year Fund Balance at End of Year $ $ Budgeted Amounts Original Final 454,610 $ 454,610 12,535 12,535 467,145 467,145 467,145 $ 467,145 90 $ $ Actual Amounts 454,608 12,531 467,139 467,139 575,970 1,043,109 ATTACHMENT A Variance with Final Budget - Positive (Negative) $ (2) (4) (6) $ (6) CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fund Schednle of Revenues, Expenditnres and Changes in Fund Balance -Budget and Actual Sewer Reconstruction Fund Year Ended June 30, 2019 Bud!leted Amounts Original Final REVENUES Charges for services $ 55,000 $ 55,000 Total Revenues 55,000 55,000 Net Change in fund balances $ 55,000 $ 55,000 Fund Balance at Beginning of Year Fund Balance at End of Year 91 ATTACHMENT A Variance with Final Budget - Actual Positive Amounts (Neiiative) $ 55,000 $ 55,000 55,000 $ 919,171 $ 974,171 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fund Schedule of Revenues, Expenditures and Changes in Fund Balance -Budget and Actual Road Maintenance Rehab Act (RMRA) Year Ended June 30, 2019 Budgeted Amounts Original Final REVENUES Intergovernmental $ 667,715 $ 667,715 Investment income 2,500 2,500 Total Revenues 670,215 670,215 EXPENDITURES Capital Outlay 604,000 810,420 Total Expenditures 604,000 810,420 Net Change in fund balances $ 66,215 $ (140,205) Fund Balance at Beginning of Year Fund Balance at End of Year 92 ATTACHMENT A Variance with Final Budget - Actual Positive Amounts (Negative) $ 667,712 $ (3) 7,562 12,562 675,274 5,059 39,578 39,578 635,696 $ 775,901 213,975 $ 849,671 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fund Schedule of Revenues, Expenditures and Changes in Fund Balance -Budget and Actual 1992/1996 Park Bond Fund Year Ended June 30, 2019 Budgeted Amounts REVENUES Intergovernmental Total Revenues OTHER FINANCING SOURCES (USES) Transfers out Total Other Financing Sources (Uses) Net Change in fund balances Fund Balance at Beginning of Year Fund Balance at End of Year $ $ Original 14,500 14,500 (14,500) (14,500) 93 Final $ 14,500 14,500 (14,500) (14,500) $ ATTACHMENT A Variance with Final Budget - Actual Positive Amounts (Negative) $ 14,500 $ 14,500 (14,500) (14,500) $ $ CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fund Schedule of Revenues, Expenditures and Changes in Fund Balance -Budget and Actual Measure M Fund Year Ended June 30, 2019 Budgeted Amounts Original Final REVENUES Intergovernmental $ 512,160 $ 512,160 Investment income 150 150 Total Revenues 512,310 512,310 EXPENDITURES Capital Outlay 400,000 400,000 Total Expenditures 400,000 400,000 Net Change in fund balances $ 112,310 $ 112,310 Fund Balance at Beginning of Year Fund Balance at End of Year 94 ATTACHMENT A Variance with Final Budget - Actual Positive Amounts (Negative) $ 512,161 $ l 7,382 7,232 519,543 7,233 3,606 396,394 3,606 396,394 515,937 $ 403,627 198,211 $ 714,148 CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fund Schedule of Revenues, Expenditures and Changes in Fund Balance -Budget and Actual Park Acquisition Fund Year Ended June 30, 2019 Budgeted Amounts REVENUES Charges for services Total Revenues EXPENDITURES Current: Public Works Capital Outlay Total Expenditures Net Change in fund balances Fund Balance at Beginning of Year Fund Balance at End of Year $ $ Original Final 40,000 $ 40,000 40,000 40,000 46,000 46,000 46,000 46,000 (6,000) $ (6,000) 95 ATTACHMENT A Variance with Final Budget• Actual Positive Amounts (Negative) $ 39,000 $ 1,000 39,000 (1,000) 4,381 (4,381) 7,040 38,960 11,421 34,579 27,579 $ 33,579 82,223 $ 109,802 ATTACHMENT A CITY OF TEMPLE CITY, CALIFORNIA Nonmajor Special Revenue Fund Schedule of Revenues, Expenditures and Changes in Fund Balance -Budget and Actual Lighting and Landscape District Fund Year Ended June 30, 2019 Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Ne~ative) REVENUES Taxes $ 1,501,900 $ 1,501,900 $ 1,497,827 $ (4,073) Investment income 35,610 35,610 35,607 (3) Total Revenues 1,537,510 1,537,510 1,533,434 (4,076) EXPENDITURES Current: Public works 1,219,350 1,222,600 1,025,024 197,576 Total Expenditures 1,219,350 1,222,600 1,025,024 197,576 Excess (deficiency) of revenue over Expenditures 318,160 314,910 508,410 193,500 OTHER FINANCING SOURCES (USES) Transfers in 357,760 357,760 357,760 Transfers out (29,095) (29,095) (29,095) Total Other Financing Sources (Uses) 328,665 328,665 328,665 Net Change in fund balances $ 646,825 $ 643,575 837,075 $ 193,500 Fund Balance at Beginning of Year 2,068,414 Fund Balance at End of Year $ 2,905,489 96 CITY OF TEMPLE CITY, CALIFORNIA Description of Statistical Section Contents Juue 30, 2019 ATTACHMENT A This patt of the City of Temple City's (City) comprehensive annual financial repmt presents detail information as a context for understanding what the information in the financial statements, note disclosures and required supplementary information says about the City's overall financial health. Financial Trends These schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time. Revenue Capacity These schedules contain information to help the reader assess the affordability of the City's current levels of outstanding debt and the City's ability to issue additional debt in the future. Debt Capacity These schedules present information to help the reader assess the affordability of the City's current levels of outstanding debt and the City's ability to issue additional debt in the future. Demographic and Economic Information These schedules offer demographic and economic indicators to help the reader understand the environment within which the City's financial activities take place. Operating Information These schedules contain service and infrastructure data to help the reader understand how the information in the City's financial report relates to the services the City provides and the activities it performs. Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial reports for the relevant year. 97 ATTACHMENT A CITY OF TEMPLE CITY Net Position by Component-Last Ten Fiscal Years 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Governmental activities: Net position: Investment in capital assets $ 27,542,462 $ 28,131,358 $ 29,208,039 $ 38,038,920 $ 51,168,623 $ 52,166,900 $ 53,143,904 $ 51,724,138 $ 52,306,797 $ 51,292,676 Restricted 10,961,386 14,736,866 11,889,013 8,445,931 4,083,955 4,898,508 6,132,978 7,098,321 8,518,526 11,957,258 Unrestricted 18,729,825 16,112,547 24,103,180 21,329,869 9,044,919 11,485,507 11,584,805 9,745,324 7,752,940 7,944,711 Total governmental activities net position $ 57,233,673 $ 58,980,771 $ 65,200,232 $ 67,814,720 $ 64,297,497 $ 68,550,915 $ 70,861,687 $ 68,567,783 $ 68,578,263 $ 71,194,645 % changes from prior year 1.57% 3.05% 10.54% 4.01% -5.19% 6.62% 3.37% -3.24% 0.02% 3.82% 98 ATTACHMENT A CITY Of TEMPLE CITY Change In Net Position Expenses and Program Revenues -last Ten Fiscal Vea rs 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Expenses: Governmental actlvitia,: General government 2,716,505 2,827,384 3,281,194 3,769,018 3,512,190 3,663,847 4,051,109 5,502,437 4,135,881 4,232,622 Publjcsafety 4,484,281 4,662,120 4,818,217 5,122,868 5,718,966 5,005,841 4,958,470 5,301,481 5,878,016 5,952,525 Publjcworks 2,969,555 1,960,629 2,162,481 2,520,925 2,970,264 3,065,241 2,901,053 4,813,770 4,668,273 2,837,774 Community development 1,480,064 1,657,399 1,562,859 1,692,614 2,222,569 3,314,298 2,165,352 2,600,043 1,924,496 1,870,993 Communlly Services 2,581,200 3,016,958 3,357,423 2,990,670 2,947,479 2,940,625 3,042,016 l.416,33a 3,659,828 4,208,894 Interest on long-Tetm Debt 321,043 429,238 149,503 Total governmental activities expense, 14,552,648 14,553,728 15,331,677 16.096,095 17,371.468 17,989,852 17,118,000 21,634,069 20,266,494 19.102,808 Program revenues: Govemmentul activities: Changes for senilces General government 151,245 82,910 39,317 1,128,428 142,880 168,420 117,564 114,326 105,743 116,086 Public safety 877,083 516,034 719,955 588,380 596,058 469,919 323,446 825,166 624,852 642,185 Public works S6,906 88,506 220.BG 314,631 917,044 978,835 915,330 1,038,514 976,036 944,66S Community development 1,056,657 1,007,719 1,322.476 1,315,893 1.424,955 1,953,925 2,005,946 1.845,202 1,805,059 1,609,882 Community Scnilces 686,18S 517,381 528,043 567,649 596,879 588,477 670,770 597,718 539.835 528,372 Operat;ng grant< and contributions General government 45,555 44,773 141,216 8,089 7,812 Public safety 133,272 136,935 100,238 100,135 100,000 106,230 120,618 129,323 139,416 148,748 Public work, 1,886,781 4,065,287 3,749,837 5,128,889 4,772,938 4,679,133 3,468,405 3,496,161 3,800,689 4,121,316 Communjty development 349,299 273,917 246,086 856,693 2,279,234 785,166 701,996 726,858 789,118 786,821 Commun;ty S~rviccs 975,576 83,03S 99,848 73,000 88,168 227.4S0 117,093 131,600 21,900 75,508 Capital grant, and contnbutions Puhl le wark, 1,295,350 454,608 Total governmental aclivilles revenues 6,218,559 6,816,497 7.02S,936 10,073.698 11,059,372 9.965,644 8,448.980 8,904,868 10.097,998 9,428,191 Net revenue, (expenses): Governmental activities: (8,334,089) P,737,231) (8,305.741) (6,022,397) (6,312,096) (8,024,208) (8,669,020) (12,729,201} (10,168,496) (9,674,617) General revenue, and other change, in net po1ition: hxe, PropcrtyTa,e, 2,780,452 3,259.485 2,253.677 2,474,978 2,597,549 2,728,718 2,873,580 3,044,928 3,301,789 3,495,364 Transient Occupancy Tax 34,844 34,221 32,%6 28,898 46,849 53,612 59,522 54,864 61,271 58,424 Sales T~x 1,475,728 1,614,726 1,642,318 1,711,128 1,735,613 1,873,423 2,000,558 1,959,152 2,146,888 2,189,206 Franchise Tax 533,542 542,523 553,598 550,527 562,535 590,620 573,650 537,773 557,594 569,736 Other Taxes 127,S73 99,701 99,417 158,962 171,193 175,892 180,943 193,670 187,066 163,989 Investment Income 262,636 409,097 378,269 132,565 203,571 180,197 282,190 78,329 186,315 829,962 Stale MotorVchkle In Lieu 3,549,571 3,229,851 3,196,237 3,310,180 3.472,6S9 4,887,322 4,071,629 4,172,548 4,463.316 4,694,844 State Revenue-Other 6.97S 8,844 12,276 7,579 11.166 8,958 15,273 8.575 9,064 9.669 Other 448.504 285.881 1,071,678 262,068 237,723 778,693 399,458 385,4S8 309,163 279,805 Total general revenues and transfers 9,219.825 9,484,329 9,240,436 8.636.885 9,038 858 11,277,43S 10.456,803 10.435.297 11,222,466 12,290,999 Extraordinary items RDA diS1olutlon: 3,744,062 Change In net position 885,736 1,747,098 4,678,757 2,614,488 2,726,762 3,253,227 1,787,783 (2,293,904) 1,053,970 2,616,382 Net Position at beginning of vear 56,347 937 57,233,673 60,521,475 65.200,232 61,570.735 65,297,488 69,073,904 70.861.867 67,524,293 68,578,263 Net Positlon at end of year $ 57,233,673 S 58,980,771 $ 68,944,294 $ 67,814,720 $ 64,297.497 $ 68,550,715 S 70,861,687 $ 68,567,963 $ 68,578,263 S 71,194,645 Sou;ce, Cit-,, of Temple City', Compreh•nsive Anoual Finan,ial ~oport 99 CITY OF TEMPLE CITY Fund Balances of Governmental Funds -Last Ten Fiscal Years 2010 2011 General Fund Nonspendable $ $ Restricted 2,360,171 1,771,165 Committed Assigned Unassigned 22,340,207 23,542,553 Total general Fund 24,700,37~--~-~-}13,718 All other governmental fund: Nonspendable Restricted 22,706 Unassigned, reported in: Special revenue funds 12,846,187 Capital projects funds Debt service funds (3,424,412) Total all other governmental funds 9,421,775 Total Governmental Funds $ 34,_144,859 Note: This schedule reports is using the modified accrual basis of accounting Source: City of Temple City's Comprehensive Annual Financial Report 14,736,866 (84,843) (3,223,856) (3,308,699) $ 36,741,885 2012 2013 $ 1,678 $ 12,795 4,500,000 4,500,000 17,200,000 15,150,000 2,352,402 1,764,267 24,054,080 21,427,062 11,889,013 8,445,931 (150) (150) $ 35,943,093 $ 29,872,_843 100 ATTACHMENT A 2014 2015 2016 2017 2018 2019 $ 10,531 $ 409,084 $ 463,539 $ 480,576 $ 128,670 $ 68,993 3,500,000 3,500,000 3,500,000 3,500,000 3,500,000 3,500,000 12,769,580 12,868,392 12,302,864 11,513,004 10,589,004 10,455,704 1,725,404 3,249,131 3,538,853 3,403,359 4,713,137 6,019,290 18,005,515 20,026 ,60~805 ,256 18,896,939 18,930,811 20,043,987 1,088,219 170,305 170,597 174,549 171,994 2,959,528 4,898,508 6,322,718 6,927,724 8,343,977 11,785,264 (360,045) (197,244) (1,722,989) (1,722,989) (360,045) (197,244) $ 20,965,043 $ 24,290,345 $ 25,938,234 $ 25,798,016 $ 27,449,337 $ _32,001,245 ATTACHMENT A CITY OF TEMPLE CITY Changes in Fund Balances of Government Funds Last Ten FiSt:al Years 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Revenues: Taxes 4,641,626 6,303,326 6,126,340 6,068,935 6,310,783 6,678,220 7,004,011 7,164,365 7,609,593 8,056,086 Licenses and Permits 1,096,347 1,028,284 1,345,183 1,335,720 1,434,610 1,844,793 1,775,836 1,772,186 1,653,939 1,653,876 lntergovermental 6,923,107 6,462,142 6,026,300 7,980,590 9,334,821 8,964,552 6,816,792 7,324,903 9,234,861 8,800,188 Charges for services 1,781,384 1,104,495 929,351 2,180,285 1,760,155 2,204,878 1,985,763 1,622,594 1,693,445 1,430,382 Fines 631,064 495,469 697,246 568,553 580,039 447,512 312,136 813,727 611,077 624,968 Investment income 610,529 562,190 493,070 220,984 411,657 242,457 312,681 91,291 192,144 829,962 Rental Income 23,590 49,195 74,632 85,359 68,411 89,116 84,241 87,460 31,686 32,636 Other 349,851 415,145 128,805 269,647 197,755 771,551 373,933 411,573 356,541 317,846 Total revenues 16,057,498 16,420,246 15,820,927 18,710,073 20,098,231 21,243,079 18,665,393 19,288,099 21,383,286 21,745,944 Expenditures Current; General Government 2,263,820 2,492,012 2,773,777 3,778,538 3,130,434 3,393,501 3,440,424 4,502,828 3,822,997 3,832,851 Community development 1,323,870 1,231,126 1,227,221 1,635,843 2,047,539 1,843,581 2,137,193 2,260,626 1,763,859 1,653,288 Public Safety 4,285,919 4,353,874 4,676,268 5,103,805 5,213,419 4,878,406 4,834,728 5,208,959 5,479,406 5,498,837 Public works 2,376,038 1,66S,506 1,803,025 2,207,950 2,544,287 2,746,162 2,888,326 2,555,994 4,400,038 2,687,989 Community Services 2,246,777 2,733,160 2,994,515 2,784,456 2,739,171 2,667,377 2,926,417 2,998,348 3,060,094 3,061,698 Capital outlay: 2,106,266 1,132,410 1,520,720 9,269,731 13,929,743 1,665,752 1,313,404 1,901,562 1,205,571 459,373 Debt services Principal retirement 295,000 305,000 315,000 Interest and fiscal charges 452,423 433,050 153,684 Bond Issuance Costs Pass-Through payment 40,046 36,333 10,897 ERAf Payment 330,160 67,974 Total expenditures 15,720,319 14,450,445 15,475,107 24,780,323 29,604,593 17,194,779 17,540,492 19,428,317 19,731,965 17,194,036 Excess (deficiency) of revenues over (under) expenditures 337,179 1,969,801 345,820 (6,070,250) (9,506,362) 4,048,300 1,124,901 (140,218) 1,651,321 4,551,908 Other financing sources (uses}: Transfers in 2,881,170 1,740,640 2,345,392 10,038,826 13,041,701 13,041,701 2,422,109 2,583,586 3,434,672 705,625 Transfer out (2,881,170) (1,740,640} (2,345,392) (10,038,826) (13,041,701) (13,041,701) {2,422,109) {2,583,586) {3,434,672) (705,625} Issuance of Refunding Revenue Bonds Bond Discount Net other financing sources {uses) Change in fund balance before extraordinary items 337,179 1,969,801 345,820 (6,070,250) (9,506,362) 4,048,300 1,124,901 (140,218) 1,651,321 4,551,908 Extraordinary items -RDA dissolution transaction: (517,387) Net change in fund balance 337,179 1,969,801 (171,567) (6,070,250) (9,506,362} 4,048,300 1,124,901 {140,218) 1,651,321 4,551,908 Fund balances at beginning of year -restated: 33,807,680 34,144,859 36,114,660 35,943,093 30,471,405 20,242,045 24,813,333 25,938,234 25,798,016 27,449,337 Fund balance {deficit) at end of year: 34,144,859 36,114,660 35,943,093 29,872,843 20,965,043 ~-:1:-.~~g,}_~5 25,938,234 25,798,016 27,449,337 32,001,245 Note: This schedule reports using the modified accrual basis cf accounting Source: City cf Temple c;ty's Comprehensive Annual Financial Report 101 ATTACHMENT A Category 2009/10 Residential 2.952.976.525 Commercial 233.159.971 lndustlial 39.13L023 Institutional 17.328.942 Irrigated 496.832 Miscellaneous 55.SOl Recreational 3.248_683 Vacant 31.388.447 SBE Nonunitaty 362-B!H Cross-Reference i.72~-752 Unsecured 26_963_336 Exempt [5.735,744] TOTALS 3,312.837,916 T otai Direct Rate 0.09197 No-Ws: THE CITY OF TEMPLE CITY ASSESSED VALUE OF TAXABLE PROPERTY 2009/1 0 -2018119 Taxable Property Values 2010111 2011112 2012113 2013114 2014/15 2015/16 2016/17 3.04!t375,507 3.176.5e7.665 3.291.734.411 3.4€-6.485.194 3.659.369.556 3.949.327.479 4.18t-J55,132 2352t0,642 241,334,139 2t.7,949,455 2:;3.434-441 2£8-60U69 282.005,t64 268.818.200 38.96a,701 32.!?34,5~6 t.~.224.415 42.-528-810 43.~12. .. 473 40.173.t.72 43,967.128 11_1:zg,so, 19,415.635 14.5&<,720 ~4.528.414 iS.873.535 20-262,630 23.706.6'?5 495,652 49:9,382 459.000 468.180 ~06342 106,3.!:2 106,9£5 55,370 55,7S4 56,898 58.033 38.308 38.398 39.0€-t 2_ 150,752 1,191.956 1,213-.113 ~.52257-'-1239.690 1261,780 2,467,340 28.565.197 27.2.:!,2.7'!7 32,285.185 32,€46273 31.540.476 35.04V-6S 50.776.6-55 252,01~ 252,011 252.o~, 252.011 252,011 252.0!~ 82,127 7.959,915 8,116A.37 9,176.726 '!0.334.899 ·W2K2.!.I 11-719,323 12.596.787 29.917.083 32.360.705 32,947.948 32,675_627 33.588.380 33249.8€6 31.32027S (5,735.744] [5.735_744} {5.735,74} 15_735,7?4} (G .706.835] [6.8~2.731] [6557.215) 3.410.1111.131 3.~.~~.027 3,67~,859,882 3,858.234256 4.09826-'-,981 4_373-439.234 4_53e,o35,449 0.09202 0.09120 0.02076 0.0-5566 O.JS692 0_08895 0.088S5 2017/18 4.4642~.206 336.078.499 4S.12S,S47 22,852164 88.220 n.n, 2,514.003 ~1.7e.5. I32 52.127 ~.914,250 35.6$5.SSO [6,587.215] 4.959 . .!.0£.575 0.08--591 Exempt values are not incluc!M: in Total. ln !~7S '!hoe. votel'S-of the Sta.le-ofCa!r:'omia pass-e-d PropesitQn 13 which fim'1ed oxes to .1 t=I ma:ccrnum rat-=-cf C~~. based up= the assess-e-d vafu,e, cfihe-pro_;:,s,rty =-eing uxec. Each ye.1r.1he ,15,s.;sSEed value of pro~ may be increased by ats ~m113ticn f::3:C'!Or" (rimit,;,c! 10 a_maximum of 2~;,;_ With few eex~ptions. pro;ierty s only reassessed .:as a =.rt of new co:-.-structs'.r. activ!ly c_r at .he t'-ne _it ts scld ca new owt:er. A!. that point. e~ property_ is reassessec based upcl'l the added value-of the ccnstn.1c:icn: er at the purchase_ ;rice ,:market_Ya1ue:, er economic ,..aluec o~the prol)E-rty sold_ The assessed va\;aton vab shown aoov,;;, r~res...nl:5 lhe cnly data cum:~lly ava:13ble w::h respect to the act.;al market value-cf raxable prcpe-rtf and ,s s..i::,jec: to the l,m.1;,ioons ooscnbeo aOOltl?- 2018119 4.705.546.836 34S,4S0.195 50.709.009 1€-,006, 110 88.220 11.968 2.9.it.599 53.4Ci3,213 62.~27 7.~0S.994 33,655.696 !6.587,215} 5.2'!9.S5U67 0.0-5893 D:zta Source: Los Ange,'es County Assessor 2009110 -2018119 Combined Tax f?.oJls Prepared On 7,'2&'2019 By MV This report is not to be used in support of debt issuance or cominuing disclosure statements vdthout the written consent of HdL, Coren & Cone 102 ATTACHMENT A THE CITY OF TEMPLE CITY DIRECT & OVERLAPPING PROPERTY TAX RATES (RATE PER $100 OF TAXABLE VALUE) Last 1 o Fiscal Years Agency 2009110 2010/11 2011112 2012{13 2013114 2014115 2015/16 2016117 2017118 201e11a aaa1c Levy' 1.0000ll 1.00CIOO 1.m:000 1.000C-0 1.00000 1.00000 t.00000 1.00COO 1.00000 t.00000 Arcad~ Unified 0.07561 0.07455 0.076S-1 D.07670 D.07500 0.07653 0.07507 0.07786 0.07551 D.05365 El MM!e-City c:moO' D~trte1 0.11907 0.12383 0.12733 o.n.2ea 0.12735 0.11e22 0.14~2 Q.14682 0.14616 D.1458[} El Moo!e Union Hgh SChOOI 0.09554 O.OE475 0.09591 0.D6992 0.09799 OJJ-8418 0.09155 [}.08469 Q.(18243 D.08793 La Ccmmun1t11 College-Ol&!rte'! 0.02311 0.04031 O.OlSJ•J 0.D4875 0.04454 O.Q.:\017 D.03575 D.03596 0.0459:1 0.04621 l.fe1n:,poilt3n Waler Ol~1rte1 0.0043D 0.00370 0.00370 0.00350 0.003~-0 0.00350 D.003.SO 0.003-50 0.0035D 0.00350 PaYO!!na commuf'll!y corege Ot&t 0.02300 0.0198S O.Ot956 0.02056 0.D1699 0.01032 O.C0872 O.OOBaS O.ODB19' 0.00767 Rosemead SGIIOO( 01:&t~c1 0.11358 0.10743 0.10507 0.100.40 D.10314. 0.09S.S6 0.09997 O.ctS33 D.11979 0.09260 -!.an Gabrte1 unmea 0.10070 0.10-19,J 0.06454 0.10523 0.10DB2 0.11444 0.10684 C.tOS.34 0.10078 0-.10.563 Temple cny· unme<1 0.04910 0.049&3 0.04590 0.04981 0.10744 0.D-99-35 O.C9!l-23 0.10052 0. 10232 0.10245 Total Direct & Overlapping• Tax Rate-s 1.G0501 1.GOSS:S 1.5!1-422 1.625'75 1.878'27 1.8--4608 1.6Glt06 1.G4DM Hl646S 1.64545 City's Share of 1% Levy Per Prop 13• 0.1874D 0.18740 0.18740 0.18740 0.18740 0,t,3740 0.18740 C.18740 0.18740 0.18740 Voter Approved City Debt Rate Redevelopment Rate~ 1.0M3D 1.00370 1.00370 Total Direct Rate• 0.09197 0.09202 O.OS-120 0.0&076 o.oaeee 0.08892 0.D3895 o.c-ee.9s 0.08891 O.Oe893 " •tn 1~a. C.!llfafrl.a ,,;ter.:Dll:!itdl=l'C()!l~tl:m 1111,N:J"\~~~piq:,e,eylu r.Y.eillll t.00%be-dir®nt. Tl,I~ UXl\-l ~ ~b", ill 11111r.;i~nde~"«'·11-ti~llt-.e~11t:ted~r:e::~·4r,;"ln. r,;»1m:in IX)th! -..o:J¾ f~e-d lil..,.Q.11~ P'tlt:l!lt; =nen are -::h!i,;ed tine:.~ a ~I.age of¥.~~ 11~"'-" ,·a111M rarttte ~;r.enlof ir,~ •'O'lef ,!pplVled v.ir<n. 'C-.'tlbcollllrJJIM are ttti:i:.eQl'lt>Clll uid tll<f'J;./ tw'•'trrren~ti"~ &tltiiJ It> troDert,· ,::,M"-e~ lo\'ltin \ht Cfy. N!lt~; o-,t~!li='P~ll l'lllt~ apptJ b al Drl)l)erty C'M"~. "Ct/~ i;..~-e!' ~'ii: Lei')" l:. 1111'".«i ~n lht Cl';{~~lllVI:! 11ftht~~ run:it.n rate lftD Viti"', t'"I!! !~t:t ntlllll'.Zltle ~11\ie lo\i\hl1 U,e Ct.,. Tl!! 9'VIF i;«t11n ofllle C!I'/:. L!:Vill~ t~n s.ib'r.K"~ 111'\tn ~lll)"ll/!1. •Rt-llt'1e~entRlllt t ba:ied<tml:"iela!Jle-.t~111'.11 r.,te11rea and0Nylndude:rd'ie1~:,mm ir~l:e:lt'!t~ ~d p_,1;,rl!l 1!<!-'Sli:,erC.llt'ornis SIik ::tal\lle. RDAlfTNtii!nd o ... e~ZIPPl'lll r:ite~M?: zipp!ied Ol"Ji lzl U,e !rQ'l!menll!II l)f"Cllllft/>',\!Ut-:, Tlle .. D!tlYoSf llfl'ISX1 ~ elml~R.ede,'K!l)mef't~.,., ttte SI~ d' C.!1I"1fl"ill fI>rtht1~tlll ~nt" ~al::.!I) U.CY!ln !h!!Ufter "Tcltal Or«t Rlllt Ill Ille welglilt-11'1'1tJ'll;t! of~l lndMct.Jlll are,:;t!llte~ ac:,plled tytt",e CJt)·.•Agcncy Jl("'ttDMIJ t-.e slll\l:;\UI ~Kil;!{\ lnfD!TMl',011 Do:I err:tHI~ rt!•<enue~ dttt,«:fre<"'"l alnn!I. 9t{ll".111110 l'I X<\litl.1h!°Tol!IIOn:ttR4r'.er.c! IN"~ lnP11de:.tt'1erlUtgeF"~frc,/l",U,e'fllrrnerl'«le~~lll)ffltn1w n,te ace a~. Ch51tnge:; ID re«,gltied ~.xi!t {lbilg$".o!'I:. D!'ell~:tlmt~ 1;, r>)'..i= lleffl IHO'"letl ct,tng ~012'11. Forllle pui:q..e~ orll\\!; repoft. 1'6\0'.»! m\~/Je r. a~umtd!!Cbt dbl!ilnrttd to llit Cl';li,",:,ef\C";" il:1 \ht ~amt ~~\Or,:; a:. IJtrltra! 11.n! re-,t"~ Dara soo~e: UJ:; Af?Qe,\o'z eo,mry MSf'S.wr 200M0 • .UHBf'tO nn: Rare 1dtlle Ptep-are<I on 712El20t9 B:,· MV Th/:; report If; not robe ~ea In zuppO!t r§ IN!D! is:;uan,e or conMU!llg ct!Jc/osure ~tarement:; ~l'tho!ll trie wnn-en coosentorH:tL, Coren & ccne 103 City of Temple City Property Tax Levies and Collections Last Ten Fiscal Years Collected within the Fiscal Year of Levy Total Collections to Date Fiscal Year Ended June 30 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Taxes Levied for the Fiscal Year 2,660,326 3,238,026 3,359,572 3,619,421 3,794,593 3,984,673 3,897,361 3,421,264 4,284,305 4,561,245 Amount 2,857,221 2,941,760 3,063,945 3,174,199 3,340,124 3,549,165 3,428,032 3,044,928 4,350,625 4,401,742 Percent of Levy 107.40% 90.85% 91.20% 87.70% 88.02% 89.07% 87.96% 89.00% 101.55% 96.50% Collections in Subse_guent Years (196,895) 296,266 295,627 445,222 454,469 435,508 469,329 376,336 Amount 2,660,326 3,238,026 3,359,572 3,619,421 3,794,593 3,984,673 3,897,361 3,421,264 Note: The amounts presented include city property taxes, Muni Lighting District, Muni lighting District A, and Muni Lighting District B Source: Los Angeles County Auditor Controller 104 Percent of Le~ 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% ATTACHMENT A ATTACHMENT A CITY OF TEMPLE CITY Revenue Capacity General Fund Revenues -Last Ten Fiscal Years Fiscal year Licenses and Charges for Investment Rental Other Total ended Taxes Permits Intergovernmental Services Fines Income Income Revenues Revenues 2010 3,830,602 1,096,347 3,549,571 542,976 534,287 442,363 65,928 348,851 10,410,925 2011 4,451,470 1,028,284 3,229,851 631,355 423,041 409,097 57,442 414,145 10,644,685 2012 4,581,975 1,345,183 3,196,237 757,496 646,498 378,269 57,268 128,805 11,091,731 2013 4,924,493 1,335,720 3,310,180 957,437 521,440 132,565 53,369 269,647 11,504,851 2014 5,113,739 1,434,610 3,480,366 1,510,392 554,805 203,571 68,411 246,206 12,612,100 2015 5,422,265 1,844,793 4,895,411 1,527,116 433,102 148,086 89,116 819,206 15,179,095 2016 5,688,253 1,775,836 4,079,441 1,627,626 303,524 306,568 84,241 303,058 14,168,547 2017 5,790,387 1,772,186 4,172,548 1,414,108 813,356 77,777 87,460 306,575 14,434,397 2018 6,173,068 1,653,939 4,463,317 1,491,537 611,074 131,324 31,686 286,041 14,841,986 2019 6,558,259 1,653,876 4,694,844 1,292,466 624,968 714,889 32,636 256,838 15,828,776 Source: City of Temple City's Comprehensive Annual Financial Report 105 THE ClTY OF TEMPLE CITY 2009/10 TOP TEN PROPERTY TAXPAYERS Top Property Owners Basecl On Net Values Owner Secured Unsecured Combined % of %of %of Pa=!s 'Value NetAV Pa=!s Value NetAV Value NetAV 1} CALA.C tNVESTh1E!\lT 2 SZ),5i4 _.553 0.62% $20.514.853 0.62% 2) ~DIAZIO INVESTMENT COMPANY • S14, H5,!47 0.43'%, $14,175.547 0.43% •:?>e:!"dL..,_,~ ~ ~!!;1 3/ WANG I TUNG 1 S 13.126.099 0.40% $13.126.099 CAO% ."~i'QA:,~O,,~l!';I 4) SANTAANITA CON'ol:u...ESCENT HOSP 2 $6,743.456 021'%, 2 S1.D81:l,7fil ,=,_04:%-$7.833 . .219 0.24% 5) RALPHS GROCERY COMPAf.."Y 1 S6.i29,i323 0.19% 1 $428,.!.77 1-59% 56.558.100 0.20% 6} JAMES JAND SUE FEMINO TRUST 2 $.5,52:1.983 0.17% SS.521.983 0.17% 7;-GEN BOARD OF THE CHRCHOFTHE NAZARN 6 sa.,~2.553 □.16% 55.112.553 0.15% S} BARCHESTER 1EMPLE c1n· 2 S4;~3i~19 0.15% 54.993.919 0.15% ·~J CHRJSTi..A,N CHRUCH PAC S:~'V REGION 1 $4,?47 2 □4 □.15% S4.9.f.7.204 0.15% 10} YJAOCH\}N ZOU AND f'BW'EN CH.ANG 5 $4,'51'9.652 0.14% S.4.619.652 0.14% Top Ten Total 28 sse,.SM,ssg 2.61% 3 S1.518.24Q 5""63% $87.403.129 2.64% City Total 53.285,874.580 $26.963.336 $3.312.837.916 Top Owna-s last editeo: Cl", an 2(16 by MaheaV using sales thro;.rgh □6,'30,'10 (Verson R 1} Daza soaree: LOS" Ang&I8S -Coun.y ASSEISSOr 260Q.-"f0 COmtlfll.ild J<U' RotlS and n'l9 SBE Hon Un,rary Tar RoI{ ibJs: .r9p0n: JS nor to b9 used m sappo!'! oraeor rssuanca o; comrnumg crrsc1osura sr.a.am-tmzs wm'loar rhe wnmm coru;enr orH<fL Coren&. Con& 106 ATTACHMENT A Primary Use & Primary Agency Commercial Successor Agency Cornmerc'.al Successor Agency Vacant Successor Agency lns:titufun31 TD#1 Commen:i.al T0#1 Comli'P-rc\at Successor Agen,:y Res1dential TD#'1 Comm,erci.al Successor Agency ll"'.stitutional TD#l Residential TD#1 Prepar:--<f On 71'26/20111 Ey M-1 ATTACHMENT A THE CITY OF TEMPLE CITY TOP 25 SALES TAX PRODUCERS FOR FISCAL YEAR 2018-19 Business Name AT&T Mobility Bistro Na's Cadfuels Temple City Chevron Circle K Grand Harbor Restaurant lcho lzakaya Fusion Cuisine In N Out Burger Kanghodong Baekjeong Kmart McDonalds Modern Lighting Office Depot Oo-Kook Korean BBQ Pep Boys Ralphs Seafood Palace Shell Shibuyala Stliki Seafood Buffet super A Foods Super Pets Temple City Powersports Tile Hat TJ Maxx Business Category Electronics/Appliance Stores Casual Dining Service Stations Service Stations Service Stations Casual Dining casual Dining Quick-Service Restaurants Casual Dining Discount Dept Stores Quick-Service Restaurants Plumbing/Electrical Supplies Office Supplies/Furniture Casual Dining Automotive Supply Stores Grocery Stores Casual Dining Service Stations Specialty Stores Casual Dining Grocery Stores Specialty Stores Boats/Motorcycles Quick-Service Restaurants Family Apparel Percent of Fiscal Year Total Paid By Top 25 Accounts = 57 .32% • F::rni.,s Listed Afphabef:~ly Printed 07l0912019 Period: Jlay 20 ~S Thru March 2019 Sources: State Board of Equali2ation< Catrforrua Department ofTa:c:E-s and Fees Admim-stration. State Controller's Office, The Hdl Companies 107 ATTACHMENT A THE CITY OF TEMPLE CITY DIRECT & OVERLAPPING DEBT AS OF JUNE 30, 2019 Percent Gross Bonded Applicable Net Bonded Debt Balance ToCilv Debt Overlapping Detlt •337.05 METROPOLITAN WATER DISTRICT 23,317,224 0.417 97,269 473.57 a MONTE CITY SD DS 2004 SERIES B 918,875 10.914 100,290 473.58 El MONTE CITY SO OS 2004 SERIES C 750,000 10.914 81,858 473.59 a MONTE CITY SD DS 2004 SERIES D (2009) 8,759,121 10.914 956,004 473.60 EL MONTE CllY SD DS 2008 SERIES A 8,345,000 10.914 910,805 473.61 EL MONTE CITY SD DS 2008 SERIES A-18ABS 5,998,159 10.914 654,662 473.62 EL MONTE CITY SD DS 2008. SERIES 8 7,080,000 10.914 772,738 473.63 EL MONTE CITY SD DS 2012 REFUND BONDS 32,540,000 10.914 3,551,540 473.64 a MONTE CITY SD DS 2014 SERIES A 10,560,000 10.914 1,152,559 473.65 a MONTE CITY SD DS 2015 REF BONDS 9,830,000 10.914 1,072,884 473.66 EL MONTE CITY SD DS 2014 SERIES B 4,845,000 10.914 528,802 473.67 EL MONTE CITY SD DS 2017 REF BOND SER A 17,505,000 10.914 1,910,562 629.53 ROSEMEAD SO OS 2007 SERIES D 120,000 4.051 4,861 629.54 ROSEMEAD SD OS 2008 SERIES A 215,000 4.051 8,709 629.55 ROSEMEAD SD DS 2011 REF BOND 6,195,000 4.051 250,943 629.56 ROSEMEAD SD OS 2012 REF BONDS 5,160,000 4.051 209,018 629.57 ROSEMEAD SD OS 2008 SERIES B 7,586,503 4.051 306,499 629.59 ROSEMEAD SD OS 2014 REF BONDS 5,560,000 4.051 225,221 629.60 ROSEMEAD SD DS 2016 REF BONDS 12,235,000 4.051 495,608 629.62 ROSEMEAD SD OS 2014 SERIES A 9,000,000 4.051 364,566 629.63 ROSEMEAD SD OS 2014 SERIES T 2 175,000 4.051 7,089 745.55 El MONTE UNION HSO DS 2008 SERIES A 30,041,132 6.573 1,974,642 745.56 a MONTE UNION HSD DS 2008 SERIES B 25,830,000 6.573 1,697,839 745.57 a MONTE UNION HSD DS 2015 REF BONDS 10,765,000 6.573 707,597 745.58 a MONTE UNION HSD DS 2016 REF Dl YD DLVR 4,165,000 6.573 273,771 745.59 EL MONTE UNION HSD DS 2008 SERIES C 46,525,000 6.573 3,189,611 745.60 a MONTE UNION HSD DS 2016 REF BONDS 10,650,098 6.573 700,045 745.61 a MONTE UMON HSD DS 2008 SERIES D 56,430,000 6.573 3,709,217 805.55 LA CCD DS 2003 TAXABLE SERIES 2004B 2,115,000 0.016 342 805.56 LA CCD DS 2001 TAXABLE SERIES 2004A 31,555,000 O.D16 5,110 805.65 LA CCD DS 2008, 2009 TAXABLE SER B 75,000,000 0.016 12,145 805.86 LA CCD OS 2008. 2D10 TAX SERIES D 125,000,000 0.016 20,242 805.67 LA CCD DS 2008, 2010 TAX SERE (BABS) 900,000,000 0.016 145,745 805.69 LA CCD DS 201l8 2012 SERIES F 202,000,000 0.016 32,712 805.70 LA CCD DS 2013 REF BONDS 38,945,000 0.016 6,307 805.71 LA CCD OS 2008 SERIES G 212,070,000 0.016 34,342 805.73 LA CCD OS 2015 REF SERIES A 1,429,435,000 0.016 231,480 805.74 LA CCD OS 2015 REF SERIES B 28,830,000 0.016 4,669 805.75 LA CCD OS 2015 REF SERIES C 252,150,000 0.016 40,833 805.76 LA CCD OS 2008 SERIES l 210,570,000 O.D16 34,099 'Ttlls run!J ~ a portlcri Ofa larger agency, and la re&JXW161ole 'fl:<! debt In areas ouWde the C;fy. nus report ra1ect6 lfet-1 wl!!Ch Iii be-lng rep.aid through vDler-app,rc .. ,•ed property lax ITTdebtedna;s. It etciudK. mortgage rev&iue, tax alloca.1on tondS.. L'lterlm nnaneing Oblga-u:ins, nOl"l-tonde<j cap<'!al le§e obllgallon&, :md cert!l!cates or part!CJpa1on. U'lless provHied tiy t!le o:t)'. o•mapplng govemme-nto are1hooe that oohcide, at iealit in part, ·~1h tne geographic bOUndV1es of1Metry. The-p,ercentag-e orovenappng t1e1,1 applcab'.e ls estma1e-rJ by using taxa~e as&!:661:d vafJeE-. AWliCJble percenlag~ were KtL'nateli by deiemilnlng the pcrt:ion or antmer govemrnentiil unit'& Wable a,;:se~d value !Ila! IS 'Aitl!n the C:ltfe. bountf.arli!& 3M dMtllrq It t,y eatm Li\"lltli total taKabll! a5U&&ell value. Dara Source: HdL Coren & Cone. Los AngeJe&: C.ou,nyA55es6or and Audilor Combined 2018119 Uen Dare Tax RolJ& Prepared On 7/28/2019 By MV TllJ& rapon l'li nor w O& uied m suf}POIT ordet:11 t.SIWnC'il' orconrmumg 11rsc.Jo.sur& orammenrs wnhoor rh9 wmren c-om:enr orH4L. Coren & cone 108 ATTACHMENT A THE CITY OF TEMPLE CITY DIRECT & OVERLAPPING DEBT AS OF JUNE 30, 2019 Gross Bonded Debt Balance overlapping Debt (Continued) 805. 77 LA CCD OS 2008 SERIES J 174,965,000 805.78 LA CCD DS 2016 REF BONDS 247,755,000 812.53 PASADENA CCD OS 2002, 2006 SERIES D 1,840,000 812.54 PASADENA CCD DS 2002, 2009 SERIES E (BABS) 25,295,000 812.55 PASADENA CCD OS 2014 REF SERIES A 13,900,000 812.56 PASADENA CCD DS 2016 REF SERIES A 32,395,000 817.53 ARCADIA UNIFIED OS 1993 SERIES C 331,333 817.57 ARCADIA UNIFIED DS 2006 SERIES B 26,910,000 817.58 ARCADIA UNIFIED DS 2017 REF 190,845,000 920.56 SAN GABRIEL USO DS 2010 REF BOND 8,404,370 920.57 SAN GABRIEL USD OS 2008 SERIES B 5,900,000 920.58 SAN GABRIEL USO DS 2012 REF BOND SERIES B 14,177,023 920.59 SAN GABRIEL USO DS 2008 SERIES C 22,918,806 920.60 SAN GABRIEL USO OS 2015 REF BOND SERIES A 31,925,000 947.52 TEMPLE CffY USD OS 1998 SERIES B 4,331,661 947.53 TEMPLE CITY USD DS 2005 REFUNDING BOND 8,560,000 947.54 TEMPLE CfTY USD OS 2012 SERIES A 21,915,863 947.55 TEMPLE CITY USO OS 2012 SERIES 8 33,457,588 947.58 TEMPLE CflY USD OS 2017 REFUNDING BOND 19,720,000 Total Overlapping Debt 2018119 Asseooed Valuation: $5,077,417,105 After Deducting S142,234,!l62 Incremental Value. Debt To Assessed Valuation Ratios: Direct Debt 0.00% Over1apping Debt Total Debt 'T!ll&-f'Llmt I& a por!ltlrl 01 a luger agency, and I&-,e1,pon:5ible ft<!" d!Wt In area Ii ouWde the c:lif. 2.01% 2.01% Percent Applicable Net Bonded ToCitv Debt 0.016 28,334 0.016 40,121 5.707 105,005 5.707 1,443,534 5.707 793,245 5.707 1,848,n7 2.945 9,758 2.945 792,510 2.945 5,620,460 2.347 197,253 2.347 138,474 2.347 332,738 2.347 537,910 2.347 749,287 71.571 3,100,219 71.571 6,140,804 71.571 15,685,434 71.571 23,945,979 71.571 14,113,830 102,106,8451 Tnl& report re1.acu 11e1,twhleh I&-t>Elng rep..3111 tl'ir0119h. '\'rl.l!f•ipproved property lD l'ltiebtedneE6. 11 exciOOes mongage revenue, tax 31foca.1on t;onds, l'lterlrn nnandn!J obfga11:1n,, noo-t..onded Clp:UI leMe Ollllg,aUon&., and certmc:ate5 Ofpartlcipa1or1, U'll~5 IXOYltr.ea t-y tile dty. over1aw1ng go~"&mmenl:6 are lhO'l!ie that col'lelde, at lea!il In part, -... mi tt1.e geogra!il'llC bound:utes c-flhectty. The p-etcentage Of ovfflapp\rlg 11e1,1 apptc.a~e I& e&~mated by u&lrig 1ual){e a66e-Med vakl~. AWll¢3b'e percen!agff. were es-!Jmalell ciy dE'11H1'1llnJng 11te portion or anr.11er ,go .. ernmen\ai ,.min tu.able 3fi6e&&ell 't'a!ue trtat ls Y.1?11n the City's bOUfill.lrle& 3rd dM!ll1'9 It Ii)' eaoo Ut'llf5 total laOb!e 355e6Eelf Yalue. Dara Source: Hd1. Coren&· Cone, Los AngeJeli Coum:yAssessor and Auditor Combined 201&1t9 Uen Dare TaK Rolls Prepared On 7/26.12019 By MV Tb.15 repon l'i not w b& l!Hd m1;uppon or dW11uuani:e or conrmvmg d1&cJo.&ureuammBJ1rt w,rhomitl& wnmm cons&nr or HdL, Co!Wl & con& 109 ,IIJ 8 <.> •C: <i C: •O :j!! ,,p 0. !!! Q. ... 0 : ATTAC HM EN T A THE C I TY OF T EMPL E CI TY DEMOGRAPHIC AND E CONOMIC STAT ISTICS CaJendar Personal Income Per-Capita Year Population, (In Thousands) Personal Income 2009 35.6 15 $858,744 S24,1 12 20 10 3 5.892 S 1,000,992 $27,889 2011 35.74 9 $936,409 $26,194 2012 35.952 $947;22.7 $26,347 2013 36.134 $932,4 7 4 $25,806 2014 36.1 52 $963,668 $26,656 2015 36.534 $986 ,655 $27,006 20 16 36.,389 S 1 ,008 ,8 1 3 $27,723 2017 36,4 11 $974,7 62 $26,77 1 20 18 36.583 S1 ,0 3 1,698 $28,20 1 Per so na l Income a nd Unemploym e nt 28.500 10 2S.C!O0 27~500 8 2 7 .000 6 2 6.500 2 6.C!OD 4 25.:iOO 25.000 2 24 .500 t-+------------------------1 24.000 L-_._ _ _._ _ ____.. __ .__ _ _.__ _ _._ _ __. __ _.___......_ _ ____..__. 0 2 009 2 0 10 201 1 2012 2013 2014 2015 2 0 16 2017 2018 I -Pa-~ta Pers lname -1.Jren'p~nt ~ C: :::, ~ "Q_ 0 '< i ~ ;u co 6 Unemployment "lo of Pop 25+ with % of Pop 25+ with Rate 7.5% 8.2% 8.0% 6.0% 4.9% 5.4 % 'il.4 % 3.4% 3.5% 3.8% C: 0 ., .!!! :::, Q. 0 Q. Medi an Age High School Degree Bachelor's Degree 40.5 87.1 % 324% 40 .8 86.3% 322% 40.6 86.5% 3 6 .0 % 40.9 85.4% 35.9% 4 1 .5 86.0% 35.9% 4 1.3 85.9% 37.0% 4 2.3 86.1% 37.6% 42.9 862% 37.3% 4 3.4 84.8% 36.8% 43.0 84.3% 38.3% E d ucatio n L ev e l Attaine d f o r P,opula tion 25 and O ve r 0 2009 2010 2011 2012 20 13 2014 2015 2016 2017 2018 [ ■ LP-ss Than Hgh School ■ Hi~ School Granlate ■ Ccl'.ege Gra:fuate Notes and Data So urces: Population: C alifornia S1ate Department oi Finance. Un empl oyment Data: C al1fcmia Employment De velopment Department 2000-2009 Income-, A ge . and Educalic n D ata: ESRI -Demographlc E siim;;tes are based on the last available Census. Proj ection s are devefope-d by i n corporating a1 of Ille prior oaisus data rel eased to date. Demographic Data is tota!ed frcm Ce nsus Block Groups that overlap the-City's bo undaries 201 O and l ata -Income , Age-and Ed ucation Dara. -US Cens us Bure-au , most recent A merican Community SuNe)' This reporr is nor ro be used in su ppon of debr issuance o r connnuin9 discl osu re starements w ilhoUI m e wrmen consenr o f HdL. -Co re n & C one ffepaiiid On i','2i:!izi019 By MV 110 ATTACHMENT A CITY OF TEMPLE CITY Operating Information Construction Activity New Calendar New New Value of year ended Residential Commercial Total Demolitions Construction 2010 20,200,934 2,156,535 22,357,469 162,000 22,195,469 2011 23,754,355 1,175,540 24,929,895 139,048 24,790,847 2012 19,536,413 2,490,427 22,026,840 144,000 21,882,840 2013 21,298,596 14,433,160 35,731,756 322,000 35,409,756 2014 32,964,118 1,298,205 34,262,323 429,900 33,832,423 2015 37,651,625 2,217,000 39,868,625 421,900 39,446,725 2016 30,428,763 2,153,520 32,582,283 474,000 32,108,283 2017 32,812,558 725,000 33,537,558 371,398 33,166,160 2018 21,043,402 1,325,360 22,368,762 439,850 21,928,912 2019 21,659,346 2,726,606 24,385,952 328,600 24,057,352 Source: City ofTemple City Community Development Department 111 ATTACHMENT A CITY OF TEMPLE CITY Operating Information FullRTime Equivalent City Employees by Function M Last Ten Fiscal Year Function 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 General Government Full Time 7.80 7.80 7.80 8.80 9.95 9.95 9.95 10.95 10.95 10.95 Part Time 0.65 0.85 3.11 3.11 1.85 2.12 2.82 1.44 1.26 0.68 8.45 8.65 10.91 11.91 11.80 12.07 12.77 12.39 12.21 11.63 Community Development Full Time 7.15 6.10 6.10 6.20 6.90 6.90 6,90 6.90 6.95 6.95 Part Time 0.26 0.06 1.64 2.64 1.60 1.26 0.69 0.55 0.85 1.19 7.41 6.16 7.74 8.84 8.50 8.16 7.59 7.45 7.80 8.14 Parks & Recreation Full Time 11.70 12.15 12.15 12.25 12.05 12.05 12.05 12.05 12.05 12.05 Part Time 21.46 18.96 22.66 18.92 26.05 26.22 26.69 23.97 24.86 18.05 33.16 31.11 34.81 31.17 38.10 38.27 38.74 36.02 36.91 30.10 Public Safety Full Time 5.40 7.05 7.05 7.65 7.55 7.55 6.85 6.85 4.60 4.60 Part Time 1.43 2.33 4.22 4.07 4.51 2.83 1.41 1.54 1.64 1.74 6.83 9.38 11.27 11.72 12.06 10.38 8.26 8.39 6.24 6.34 Public Works Full Time 3.95 2.90 2.90 3.10 3.55 3.55 3.25 4.25 6.45 6.45 Part Time 0.34 0.28 1.79 0.46 1.84 0.83 0.12 4.29 2.90 3.18 4.89 4.01 5.39 4.08 4.37 6.45 6.45 Full Time Total 36.00 36.00 36.00 38.00 40.00 40.00 39.00 41.00 41.00 41.00 Part Time Total (1) 24.14 22.20 31.91 30.53 34.47 34.27 32.44 27.62 28.61 21.66 TOTAL 60.14 58.20 67.91 68.53 74.47 74.27 71.44 68.62 69.61 62.66 Note: (1) 2,080 Hours of Part Time equals to 1 Full Time Equivalent Source: City of Temple City Administrative Services Department 112 ATTACHMENT A CITY OF TEMPLE CITY Operating Information Operating Indicators by Function -Last Ten Fiscal Years 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Public Safety: Arrests 514 949 1,105 852 626 758 535 548 486 680 Parking Citations 12,681 9,024 9,926 10,025 10,260 9,919 5,288 9,946 13,128 11,419 Public Works: Sewers new connections 36 25 30 59 94 106 82 87 78 80 Parks & Recreation: Number of recreation classes 330 390 400 368 380 374 326 320 210 204 Number of facility rentals 1,179 1,083 1,110 1,178 1,072 1,254 972 1,057 1,521 1,513 Source: City of Temple City Community Development Department, Parks & Recreation Department, and Los Angeles County Sheriff Department 113 ATTACHMENT A CITY OF TEMPLE CITY Operating Information Capital Asset Statistics by Function -Last Ten Fiscal Years 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Public Works: Miles of arterial streets maintained 14 14 14 14 14 14 14 14 14 14 Miles of non-arterial streets maintained 57 57 57 57 57 57 57 57 57 57 Miles of storm drain maintained 2 2 2 2 2 2 2 2 2 2 Number of traffic signals 39 39 39 39 39 39 39 39 39 39 Number of street lights 364 364 364 706 706 706 706 706 706 706 Parks & Recreation: Number of parks 2 2 2 2 2 2 2 2 2 2 Total park acreage 19 19 19 19 19 19 19 19 19 19 Number of baseball/sofball diamonds 2 2 2 2 2 2 2 2 2 2 Number of community centers 1 1 1 1 1 1 1 1 1 1 Number of tennis courts 7 7 7 7 7 7 7 7 7 7 Number of basketball courts 2 2 2 2 2 2 2 2 2 2 Source: City of Temple City Community Development Department and Parks & Recreation Department 114 ATTACHMENT B EideBaill~ CPAs & BUSINESS ADVISORS December 26, 2019 To the Honorable Mayor and Members of the City Council City of Temple City, California We have audited the financial statements of the City of Temple City (City) as of and for the year ended June 30, 2019, and have issued our report thereon dated December 26, 2019. Professional standards require that we advise you of the following matters relating to our audit. Our Responsibility in Relation to the Financial Statement Audit under Generally Accepted Auditing Standards and Government Auditing Standards As communicated in our letter dated June 28, 2019 our responsibility, as described by professional standards, is to form and express an opinion about whether the financial statements that have been prepared by management with your oversight are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America. Our audit of the financial statements does not relieve you or management of your respective responsibilities. Our responsibility, as prescribed by professional standards, is to plan and perform our audit to obtain reasonable, rather than absolute, assurance about whether the financial statements are free of material misstatement. An audit of financial statements includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control over financial reporting . Accordingly, as part of our audit, we considered the internal control of the City solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control. We are also responsible for communicating significant matters related to the audit that are, in our professional judgment, relevant to your responsibilities in overseeing the financial reporting process. However, we are not required to design procedures for the purpose of identifying other matters to communicate to you. We have provided our comments regarding significant deficiencies in internal control in our Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards dated December 26, 2019. What inspires you, in spires us. eidebailly.com 10681 Foothill Blvd ., Ste. 300 Rancho Cucamonga, CA 91730-3831 T 909 .466.4410 F 909.466.443 1 EOE 1 ATTACHMENT B Planned Scope and Timing of the Audit We conducted our audit consistent with the planned scope and timing we previously communicated to you. Compliance with All Ethics Requirements Regarding Independence The engagement team, others in our firm, as appropriate, our firm, and other firms utilized in the engagement, if applicable, have complied with all relevant ethical requirements regarding independence. Qualitative Aspects of the Entity's Significant Accounting Practices Significant Accounting Policies Management has the responsibility to select and use appropriate accounting policies. A summary of the significant accounting policies adopted by the City is included in Note 1 to the financial statements. There have been no initial selection of accounting policies and no changes in significant accounting policies or their application during 2019. No matters have come to our attention that would require us, under professional standards, to inform you about (1) the methods used to account for significant unusual transactions and (2) the effect of significant accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus. Significant Accounting Estimates Accounting estimates are an integral part of the financial statements prepared by management and are based on management's current judgments. Those judgments are normally based on knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ markedly from management's current judgments. The most sensitive accounting estimates affecting the financial statements were: Management's estimates of the: • Net pension liability, deferred inflows/outflows of resources, pension expense, and disclosures, are based on actuarial valuations for the CalPERS plan. • Other post-employment benefits (OPEB) liability, deferred inflows/outflows of resources, OPEB expense, and disclosures are based on actuarial valuations. We evaluated the key factors and assumptions used to develop the estimates noted above and determined that they were reasonable in relation to the basic financial statements taken as a whole. 2 ATTACHMENT B Financial Statement Disclosures Certain financial statement disclosures involve significant judgment and are particularly sensitive because of their significance to financial statement users. The most sensitive disclosures affecting the City's financial statements relate to: The disclosure of the City's cost-sharing multiple employer defined benefit pension plan, net pension liability, deferred outflows/inflows of resources, and pension expense, in Note 8 to the financial statements. The valuation of the net pension liability and deferred outflows/inflows of resources are sensitive to the underlying actuarial assumptions used, including but not limited to, the investment rate of return and discount rate. As disclosed in Note 8, a 1% increase or decrease in the discount rate has a significant effect on the City's net pension liability. The disclosures related to the City's agent multiple employer defined benefit OPEB plan, net OPEB liability, deferred outflows/inflows of resources, and OPEB expense, in Note 10 to the financial statements. The valuations of the net OPEB liability and deferred outflows/inflows of resources are sensitive to the underlying actuarial assumptions used including, but not limited to, the investment rate of return, discount rate, and healthcare cost trend rates. As disclosed in Note 10, a 1% increase or decrease in the discount rate and healthcare cost trend rates has a significant effect on the City's net OPEB liability. The financial statement disclosures are neutral, consistent, and clear. Significant Difficulties Encountered during the Audit We encountered no significant difficulties in dealing with management relating to the performance of the audit. Uncorrected and Corrected Misstatements For purposes of this communication, professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that we believe are trivial, and communicate them to the appropriate level of management. Further, professional standards require us to also communicate the effect of uncorrected misstatements related to prior periods on the relevant classes of transactions, account balances or disclosures, and the financial statements as a whole. Misstatements that we identified as a result of our audit procedures were brought to the attention of, and corrected by, management are identified in the attached Schedule of Corrected Misstatements. Disagreements with Management For purposes of this letter, professional standards define a disagreement with management as a matter, whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter, which could be significant to the City's financial statements or the auditor's report. No such disagreements arose during the course of the audit. 3 ATTACHMENT B Representations Requested from Management We have requested certain written representations from management which are included in the management representation letter dated December 26, 2019. Management's Consultations with Other Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters. Management informed us that, and to our knowledge, there were no consultations with other accountants regarding auditing and accounting matters. Other Significant Matters, Findings, or Issues In the normal course of our professional association with the City, we generally discuss a variety of matters, including the application of accounting principles and auditing standards, operating conditions affecting the entity, and operating plans and strategies that may affect the risks of material misstatement. None of the matters discussed resulted in a condition to our retention as the City's auditors. This report is intended solely for the information and use of the City Council, and management of the City and is not intended to be, and should not be, used by anyone other than these specified parties. Rancho Cucamonga, California 4 City of Temple City Schedule of Corrected Misstatements June 30, 2019 Number Fund Account/Description 1 General Payroll Checking Wages Payable To correct accrued payroll/wages payable balance and payroll checking account balance 2 State Gas Cash/Checking Tax A/R Intergovernmental Measure Cash/Checking M A/R Intergovernmental To correct cash and account receivable balance 3 Sucessor Accrued Interest Payable Agency Interest Expense To correct accrued interest payable account balance ATTACHMENT B Debit Credit $ 85,252 $ 85,252 66,709 66,709 41,376 41,376 63,237 63,237 5 ATTACHMENT C EideBaill)'® CPAs & BUSINESS ADVI SORS Independent Accountant's Report on Applying Agreed-Upon Procedures Related to the Article XIII-B Appropriations Limit Calculation The Honorable Mayor and Members of the City Council City of Temple City, California We have performed the procedures enumerated below, which were agreed to by the City of Temple City, California (City) (the specified party), to the Appropriations Limit Calculation of the City prepared in accordance with Section 1.5 of Article XIII-B of the California Constitution, for the fiscal year ended June 30, 2019. The City's management is responsible for the Appropriations Limit Calculation. The sufficiency of the procedures is solely the responsibility of the City. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose. The procedures performed and our findings are as follows: 1. We obtained the completed worksheets setting forth the calculations necessary to establish the City's appropriation limit and compared the 2018-2019 limit and a nnual adjustment factors included in those worksheets to the limit and annual adjustment factors that were adopted by resolution of the City Council. We also compared the population and inflation options included in the aforementioned worksheets to those that were selected by a recorded vote of the City Council. Finding: No exceptions were found as a result of this procedure. 2. We added last year's limit to the annual adjustment amount, and compared the resulting amount to the 2018-19 appropriations limit. Finding: No exceptions were found as a result of this procedure. 3. We compared the current year information to the worksheets described in No. 1 above and to information provided by the California State Department of Finance. Finding: No exceptions were found as a result of this procedure. 4. We agreed the prior year appropriations limit to the prior year appropriations limit adopted by the City Council. Finding: No exceptions were found as a result of this procedure. Wh at ins pires you, insp ires us. eideba illy.com 10 6 8 1 Foothill Blvd., Ste. 300 Rancho Cucamonga, CA 9 1730-383 1 T 909.466.4410 F 909.4 66.44 31 EO E 1 ATTACHMENT C This agreed-upon procedures engagement was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. We were not engaged to and did not conduct an examination or review, the objective of which would be the expression of an opinion or conclusion, respectively, on the Appropriations Limit calculation. Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. No procedures have been performed with respect to the determination of the appropriation limit for the base year, as defined by Article Xlll-8 of the California Constitution. This report is intended solely for the information and use of the City Council and management of the City and is not intended to be and should not be used by anyone other than those specified parties. Rancho Cucamonga, California December 26, 2019 2 ATTACHMENT D l EideBaill~ CPAs & BUSINESS ADVISO RS Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards The Honorable Mayor and the Members of the City Council City of Temple City, California We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the City of Temple City, California (City), as of and for the ye ar ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the City's basic financial statements, and have issued our report thereon dated December 26, 2019. Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered the City's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly, we do not express an opinion on the effectiveness of the City's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a d eficiency, or a combination of deficiencies, in internal control su ch that there is a reasonable possib ility that a material mis statement of the entity's financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that have not been identified. Given these limitations, during our audit w e did not identify any deficiencies in internal control that we consider to be material weaknesse s. We did identify certain deficienci es in internal control, described in the accompanying schedule of finding and re sponse as item 2019-001 and 2019-002 that we con sid er to be significant deficiencies. What inspires you, insp ires us. eideba illy.com 1 1068 1 Footh ill Blvd., Ste. 300 I Roncho Cuca monga, CA 9 1730-383 1 I T 909.466.44 10 F 909.466.443 1 I EOE ATTACHMENT D Compliance and Other Matters As part of obtaining reasonable assurance about whether the City's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. The City's Response to Findings The City's response to the findings identified in our audit is described in the accompanying schedule of findings and response. The City's response was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Rancho Cucamonga, California December 26, 2019 2 ATTACHMENT D City of Temple City, California Schedule of Findings and Responses June 30, 2019 Finding 2019-001 BANK RECONCILIATION Criteria or Specific Requirement: As part of the City's year-end closing process, the reconciliation of bank accounts is a significant control in ensuring the account balance is reasonably stated for completeness, accuracy and cutoff. This process should be completed on a timely manner to ensure the accuracy of the account balance. Condition: As a result of our audit procedures, we noted the following: • During our testing of the City's June 2019 payroll account, we noted the cash balance was adjusted to include accrued payroll/wages that were issued subsequent to June 2019 and included in the June 2019 reconciliation. As a result, both cash and accrued payroll/wages were understated at year end by $85 thousand. • During our testing of the City's June 2019 main checking account, we noted the cash balance excluded direct deposits that were deposited in the bank prior to June 2019. As a result, cash was understated by $108 thousand and intergovernmental accounts receivable was overstated at year end by the same dollar amount. Context: The conditions noted above were identified as a result of our audit procedures. Effect: Audit adjustments were proposed to correct the City's cash, accrued payroll and intergovernmental receivable. Further, the internal control environment is weakened. Cause: Certain aspects of the City's reconciliation and/or year-end closing procedures were not in place or consistently applied. Recommendation: We recommend that the City strengthen its bank reconciliation procedures to ensure that reconciling items are properly evaluated, supported and recorded on a timely basis. 3 City of Temple City, California Schedule of Findings and Responses June 30, 2019 View of Responsible Officials and Planned Corrective Action: ATTACHMENT D The two conditions were a result of revisions in the processes this year in that the payroll checking account became a zero-based checking account, so the recording of payroll transactions were modified between two bank accounts, and the cash receipting process is now being utilized to record direct deposits in the City's checking account. For both conditions, we did not foresee the effect of how the processes affect year-end transactions. The City will ensure that year-end processes are reviewed and recorded to the appropriate month and year. Finding 2019-002 YEAR-END CLOSING Criteria or Specific Requirement: Management is responsible for the basic financial statements and all accompanying information as well as all representations contained therein and for the fair presentation of the financial statement in conformity with U.S. general accepted accounting principles. This requires management to work through a year-end closing process to accumulate, reconcile, and summarize information for inclusion in the annual financial statements. The year-end closing process include the review and/or reconciliation of all balances within the City's general ledger, Accounts must be reviewed for proper cutoff, classification and presentation. These processes should be completed on a timely manner to ensure the accurate presentation of financial information. Condition: As a result of our audit procedures, we noted the Successor Agency's accrued interest payable had an accumulated balance of $92 thousand. This balance had not been updated for this fiscal year. As a result, accrued interest payable was overstated by $63 thousand. Context: The conditions noted above were identified as a result of our audit procedures. Effect: Audit adjustments were proposed to correct the City's accrued interest payable and related expense for the private purpose trust fund. Cause: Certain aspects of the City's reconciliation and/or year-end closing procedures were not in place or consistently applied. 4 City of Temple City, California Schedule of Findings and Responses June 30, 2019 Recommendation: ATTACHMENT D We recommend that the City strengthen its year-end closing procedures to ensure that year-end account balances are properly evaluated, supported and recorded on a timely basis. View of Responsible Officials and Planned Corrective Action: The entry was recorded during the prior bond issue and staff was not aware of needing to update the account. With this finding, management will ensure that this account is reconciled annually at year-end. 5 ATTACHMENT D City ofTemple City, California Summary of Prior Audit Finding June 30, 2019 Summarized below is the current status of all audit findings reported in the prior audit's schedule of findings and questioned costs. Finding Program CFDANo. Compliance Requirement Status No. 2018-001 Highway Planning and 20.205 Allowable Costs/Cost Implemented Construction Cluster Principles, Cash Management 6