HomeMy Public PortalAboutAudit Report - District- FY19Comprehensive Annual Financial Report
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FISCAL YEAR ENDED JUNE 30, 2019
Managing nearly 65,000 acres of public open space land in 26 preserves
across parts of San Mateo, Santa Clara and Santa Cruz counties
Midpeninsula Regional Open Space District
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Comprehensive Annual Financial Report
Fiscal Year Ended June 30, 201 9
Midpeninsula Regional Open Space District
Prepared by:
Finance and Administrative Services
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Introductory Section
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Midpeninsula Regional Open Space District
Santa Clara County
Comprehensive Annual Financial Report
For the Year Ended June 30, 2019
TABLE OF CONTENTS
TITLE PAGE
INTRODUCTORY SECTION
Table of Contents......................................................................................................................... 1
Transmittal Letter ........................................................................................................................ 3
Board of Directors & Management.............................................................................................. 9
Organizational Chart .................................................................................................................... 10
Regional Map............................................................................................................................... 11
Achievement Award .................................................................................................................... 12
FINANCIAL SECTION
Independent Auditor’s Report...................................................................................................... 14
Management’s Discussion and Analysis ..................................................................................... 18
Basic Financial Statements:
Government-Wide Financial Statements:
Statement of Net Position............................................................................................... 28
Statement of Activities ................................................................................................... 29
Fund Financial Statements:
Balance Sheet –Governmental Funds ........................................................................... 32
Reconciliation of the Governmental Funds Balance Sheet to the
Statement of Net Position ........................................................................................ 33
Statement of Revenues, Expenditures, and Changes
in Fund Balance –Governmental Funds ................................................................. 34
Reconciliation of Governmental Funds Statement of Revenues, Expenditures,
and Changes in Fund Balance to the Statement of Activities .................................. 35
Notes to the Basic Financial Statements ............................................................................... 38
REQUIRED SUPPLEMENTARY INFORMATION
Schedule of Revenue, Expenditures and Changes in Fund Balance -
Budget and Actual (GAAP) -General Fund ......................................................................... 74
Schedule of Pension Plan Contributions ...................................................................................... 75
Schedule of Net Pension Liability Proportionate Shares............................................................. 76
Schedule of Contributions for Postemployment Benefits ............................................................ 77
Schedule of Changes in Net OPEB Liability ............................................................................... 78
SUPPLEMENTARY INFORMATION
Schedule of Revenue, Expenditures and Changes in Fund Balance –
Budget and Actual (GAAP) -Measure AA Capital Projects Fund....................................... 82
Schedule of Revenue, Expenditures and Changes in Fund Balance –
Budget and Actual (GAAP) -GF Capital Projects Fund ...................................................... 83
Schedule of Revenue, Expenditures and Changes in Fund Balance –
Budget and Actual (GAAP) -Debt Service Fund ................................................................. 84
Measure AA Bond Program –Schedule of Program Expenditures ............................................. 85
Notes to Supplementary Information ........................................................................................... 86
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Midpeninsula Regional Open Space District
Santa Clara County
Comprehensive Annual Financial Report
For the Year Ended June 30, 2019
STATISTICAL SECTION
Net Position ................................................................................................................................. 90
Changes in Net Position............................................................................................................... 91
Fund Balances of Governmental Funds ....................................................................................... 92
Changes in Fund Balances of Governmental Funds .................................................................... 93
Assessed and Actual Value of Taxable Property ......................................................................... 94
Direct and Overlapping Property Tax Rates ................................................................................ 95
Principal Property Tax Payers ..................................................................................................... 96
Property Tax Levies and Collections ........................................................................................... 97
Ratios of General Bonded Debt Outstanding............................................................................... 98
Ratios of Outstanding Debt.......................................................................................................... 99
Legal Debt Margin Information ................................................................................................... 100
Demographic and Economic Statistics ........................................................................................ 101
Principal Employers..................................................................................................................... 102
Full-time Equivalent District Government Employees by Function............................................ 103
Capital Asset Statistics by Function ............................................................................................ 104
Operating Indicators by Function ................................................................................................ 105
OTHER INDEPENDENT AUDITOR’S REPORTS:
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 ......................................... 108
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Midpeninsula Regional Open Space District
330 Distel Circle
Los Altos, California 94022
November 20, 2019
Members of the Board of Directors and Midpen Constituents:
The Comprehensive Annual Financial Report (CAFR) of the Midpeninsula Regional Open Space District
(District) for the year ended June 30, 2019 is hereby submitted.
The CAFR has been prepared by the Finance Department in compliance with the principles and standards for
financial reporting promulgated by the Governmental Accounting Standards Board (GASB). The CAFR
consists of District management’s representations concerning the finances of the District. Management
assumes full responsibility for completeness, accuracy of data, and fairness of presentation, including all
footnotes and disclosures, and believes the data presented is accurate in all material respects and is presented
in a manner designed to fairly set forth the financial position and results of operations of the District.
The District’s accounting records for governmental operations are maintained on a modified accrual basis,
with the revenues being recorded when both measurable and available, and expenditures being recorded when
the services or goods are received and the liabilities are incurred.
District management has established a comprehensive framework of internal controls designed both to protect
the District’s assets from loss, theft, or misuse; and to compile sufficiently reliable information for the
preparation of the District’s financial statements in conformity with generally accepted accounting principles.
Because the cost of internal controls should not outweigh their benefits, the District has designed its controls
to provide reasonable, but not absolute, assurance that the financial statements will be free from material
misstatement. The CAFR has been audited by the independent certified public accounting firm of Chavan &
Associates, LLP. The independent certified public accounting firm has issued an unmodified opinion on the
District’s financial statements for the year ended June 30, 2019.
Management’s Discussion and Analysis (MD&A) immediately follows the independent auditor’s report and
provides a narrative introduction, overview, and analysis of the financial statements. This letter of
transmittal serves as a complement to the MD&A and should be read in conjunction with it.
MIDPENINSULA REGIONAL OPEN SPACE DISTRICT PROFILE
The Midpeninsula Regional Open Space District (the “District”) was formed in 1972 to acquire and preserve
public open space land in northern and western portions of the County of Santa Clara. In June 1976, the
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southern and eastern portions of the County of San Mateo were annexed to the District. The District annexed
three parcels located in the northern tip of Santa Cruz County in 1992, but the 1% ad valorem property tax is not
levied on this land for the benefit of the District. In September 2004, the District completed the Coastside
Protection Program, which extended the District boundaries to the Pacific Ocean in the County of San Mateo
County, from the southern borders of the City of Pacifica to the San Mateo/Santa Cruz County line. The District
also does not receive any portion of the 1% ad valorem property tax for the Coastside area.
The District’s jurisdiction encompasses over 550 square miles of land in the County of Santa Clara
(approximately 200 square miles), the County of San Mateo (approximately 350 square miles) and the County
of Santa Cruz County (approximately 2.6 square miles). The Counties of Santa Clara and San Mateo are referred
to together as the “Counties.” As of the 2010 decennial census, approximately 720,000 people lived within the
boundaries of the District.
The District has preserved nearly 64,000 acres of public land and manages 26 open space preserves within its
mission to acquire and preserve a regional greenbelt of open space land in perpetuity, protect and restore the
natural environment, and provide opportunities for ecologically sensitive public enjoyment and education. On
the rural San Mateo County Coast, the mission also includes to acquire and preserve in perpetuity agricultural
land of regional significance, preserve the rural character, and encourage viable agricultural use of land
resources.
A seven-member Board of Directors (Board), elected by individual ward, establishes policies for the District.
Specifically, the Board sets general operating objectives for the District, authorizes debt issuance, monitors
financial and long-range planning, establishes policies governing conditions of employment, and sets policies to
protect and enhance the natural and cultural resources of the District. Members of the Board of Directors are
elected for staggered four-year terms. The Board appoints a General Manager to serve as the District’s chief
executive officer. The General Manager provides direction and leadership to all District departments, and ensures
that all District policies are implemented.
The District is a legally separate and fiscally independent entity from other government agencies, which may also
provide governmental services within the same geographic area. The CAFR includes all funds of the District.
There are no separate or legal entities or component units included in the financial statements of the District,
however the District does have a blended component unit included in its financial statements. In 1996, the District
and Santa Clara County established the Midpeninsula Regional Open Space District Financing Authority
(Authority) to help the District finance improvements by acquiring land to preserve and use as open space in
cooperation with the District. The President of the District’s Board of Directors is also the Chairperson of the
Authority. Three District Directors and a Supervisor from Santa Clara County are also on the Authority Board.
In effect, the Authority operates in tandem with the District.
FACTORS AFFECTING FINANCIAL CONDITION
The information presented in the financial statements is perhaps best understood when considered from the
broader perspective of the environment in which the District operates.
State and Local Economy
The California economy continues to out-perform the nation as a whole with steady growth. Many of the key
economic indicators continue to contribute to a positive economic outlook: unemployment at historical lows,
continuing growth in GDP, and stable inflation. In its most recent report for Fall 2019, Beacon Economics report
shows that job growth in the South Bay area continues to expand at a rate much higher than the state average, with
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the flagship technology sector recording 3.7% job growth from August 2018 to August 2019 as compared to 1.8%
for the state as a whole. The two main challenges to the Bay Area economy remain housing affordability and the
lack of investment in aging infrastructure that is being further strained by population and job growth.
Both Santa Clara and San Mateo Counties have been outperforming the California and U.S. economies in recent
years and continue to do so. The Bureau of Economic Analysis reported a 2.9 percent growth in 2018 and 1.9
percent through the first three quarters of 2019. GDP growth for the Silicon Valley metropolitan area (San José-
Sunnyvale-Santa Clara) increased by a significant 7.6 percent in 2017 (latest available data) compared to the
average U.S. metro area growth of 2.1 percent.
The District’s boundaries encompass a large swath of Silicon Valley, which continues to be the world’s premier
location for the technology industry with a long culture of entrepreneurship and innovation. The District
historically derives two-thirds of its general fund property tax revenue from Santa Clara County and one-third
from San Mateo County (excluding the coastside).
The real estate market in the both San Mateo and Santa Clara Counties continue to demonstrate strong demand in
both the residential and commercial sectors. For Fiscal Year (FY) 2019-2020, the Santa Clara County Assessor’s
Office reported that the assessment roll increased by 6.79 percent, to a total of $516 billion. Similarly, San Mateo
County reported that the total value of assessed properties increased by 7.10 percent for FY 2019-20. Total
assessments within the District’s boundaries increased by 7.9 percent for FY 2018-19. Over the past 10 years, the
District’s general fund property tax revenues have increased by an annual average of 6.87 percent.
The assessor’s office of both counties reported continued strength in the growth of assessed value with the 2019-
2020 property tax rolls. However, both assessors are signaling a note of caution as residential home prices start
to flatten in face of the well-publicized affordability issues, as well as the potential impact of recent changes to
federal tax laws. Commercial development is still strong, though may face headwinds from global trade
uncertainties and the polarized national political climate heading into the 2020 elections.
According to the Federal Reserve Bank of St. Louis, personal income levels as of 2017 (the most recent year for
which county data is available) show per capita income of $98,032 for Santa Clara and $113,410 for San Mateo,
which are significantly above $60,156 for the State and $51,869 for the nation.
Employment growth remains strong with unemployment rates now at historic lows. According to the California
Employment Development Department, the Bay-Peninsula region continues to have the lowest unemployment
rate in the State and experienced the fastest job growth of any region in the State during the historic economic
expansion beginning in July 2010. Unemployment rates in Santa Clara and San Mateo were 2.8 percent and 2.4
percent respectively as of June 2018, comparing to rates of 4.2 percent for the State and 4.0 percent for the nation.
The strong job market spans all sectors, with particular strength in technology and construction.
While the overall economic indicators remain positive, the District is continuing to develop prudent spending
plans, providing the financial resources to deal with a potential recession. The aforementioned housing
affordability crisis and tight labor market continue to present challenges for the hiring and retention of employees.
Construction costs for capital projects are still increasing at a more rapid pace compared to the general inflation
and the remote locale of District projects lead to a smaller pool of contractors willing to bid on projects. The
District is addressing this issue through doing more in-house design/build and through greater outreach to the
contractor community.
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Major Initiatives
In the 2018-19 Fiscal Year, the District has achieved the completion of major projects and actions, including the
following:
Opened Bear Creek Redwoods Preserve to the public in June 2019, improvements include:
x New parking lot, vault toilet restroom, ADA pathway around Upper Lake, new bridge installation,
and 6 miles of new and improved trails. Completed design, fabrication and installation of two
interpretive signs for the new Alma College parking area and Upper Lake area.
x Worked with GIS, Visitor Services, and Public Affairs to complete design, content, and web
development of “Layers of History” online story map at openspace.org/bcrstory, educating the
public on the area’s rich history, which reached over 800 users in two months.
Completed new section of Oljon Trail to provide a new loop trail opportunity from the parking lot and
completed majority of the restoration of an eroded, unsustainable section of the Steam Donkey Trail, with
poor access off Skyline Boulevard at El Corte de Madera Preserve.
Continued major actions to close a 0.6-mile gap in the San Francisco Bay Trail at Ravenswood Preserve and
assisted the City of East Palo Alto in developing the adjacent Cooley Landing Park
Received Board approval of the District’s Climate Action Plan to meet the adopted Climate Change Goals
of 20% reduction in operational greenhouse gas emissions from 2016 levels by 2022, 40% by 2030 and 80%
by 2050. Began implementation of the plan by changing fuel tanks to renewable diesel, purchasing 100%
renewable electricity for offices, acquiring electric bikes and UTV for field staff, and purchasing carbon
offsets for business flights. Completed the 2018 Greenhouse Gas emissions inventory. Held initial talks on a
carbon sequestration pilot project with the San Mateo Resources Conservation District
Continued the Highway 17 Wildlife and Regional Trail Crossings project, identifying and analyzing
additional crossing alternatives in response to partner, stakeholder and public comments. Drafted the project
study report and received Caltrans initial comments. Held meetings with project partners and stakeholders
(Caltrans, San Jose Water Company, Committee for Green Foothills, National Wildlife Federation) and a 2 nd
public meeting to receive input on the alternative wildlife crossings.
Constructed two new pedestrian bridges on the Stevens Creek Nature Trail in Monte Bello Preserve;
removed a failing old bridge and restored the construction area. These bridges will allow the use of the
Stevens Creek Nature Trail throughout the winter.
Continued implementation of critical Financial and Operational Sustainability Model Study
recommendations to enhance the delivery of Measure AA and Vision Plan projects, including the launch of
the Work Order & Asset Management System, as well as Project Central as a SharePoint solution for
monitoring and managing District projects.
Leveraged the use of Measure AA bond funding through successful grant application totaling over $1.5
million.
Acquired 192.91 acres of open space lands valued at nearly $3 million.
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Relevant Financial Policies
Budget Policy
The District follows best practices in budgeting, including: assessment of constituent needs, development of long
range plans, adherence to budget preparation and adopted procedures, monitoring of performance, and adjustment
of the budget as required. The District budget is divided into four categories: Operating Budget, Capital Budget,
Land and Associated Costs, and Debt Service. The budget is prepared and adopted on a cash-basis, whereas the
annual financial statements are prepared on a modified accrual basis. The budget can be amended during the year,
in accordance with the Board Budget and Expenditure Policy, which states that increases to any of the four budget
categories must be approved by the Board.
Investment Policy
The District’s Investment Policy is adopted annually, in accordance with State law. The policy provides guidance
and direction for the prudent investment of District funds to safeguard the principal of invested funds and achieve
a return on funds while ensuring the liquidity needs of the District. The ultimate goal is to maximize the efficiency
of the District’s cash management system, and to enhance the economic status of the District, while protecting its
pooled cash.
The investment of funds is governed by the California Government Code Section 53601 et seq., and by California
Government Code Section 53630 et seq. Funds on deposit in banks must be federally insured or collateralized in
accordance with the provisions of California Government Code Section 53630 et seq.
Fund Balance Policy
The Board of Directors adopted the Fund Balance Policy in 2014, and updated the Policy in 2016 to achieve the
following goals: provide adequate funding to meet the District’s short-term and long-term plans; provide funds
for unforeseen expenditures related to emergencies, such as natural disasters; strengthen the District’s financial
stability against present and future uncertainties, such as economic downturns and revenue shortfalls; and maintain
an investment-grade bond rating. This policy has been developed with the counsel of the District’s independent
auditors, to meet the requirements of GASB 54.
The components of the District fund balances are as follows:
x Non-Spendable fund balance includes amounts that cannot be spent either because they are not in
spendable form, e.g. prepaid insurance, or because of legal or contractual constraints. At all times, the
District shall hold fund balance equal to the sum of its non-spendable assets.
x Restricted fund balance includes amounts that are constrained for specific purposes, which are externally
imposed by constitutional provisions, enabling legislation, creditors, or contracts.
x Committed fund balance includes amounts that are constrained for specific purposes that are internally
imposed by the District Board of Directors. Funds spent from committed funds shall be reimbursed from
the general fund within two years.
x Assigned fund balance includes amounts that are intended to be used for specific purposes that are neither
restricted nor committed. Such amounts may be assigned by the General Manager if authorized by the
Board of Directors to make such designations. Projects to be funded by assigned funds require the
approval of the General Manager. Funds spent from assigned funds shall be reimbursed from the general
fund within two years.
x Unassigned fund balance includes amounts within the general fund which have not been classified within
the above categories. The Board shall designate the minimum amount of unassigned fund balance, which
is to be held in reserve in consideration of unanticipated events that could adversely affect the financial
condition of the District and potentially jeopardize the continuation of necessary public services. The
current minimum unassigned fund balance is 30% of the Budgeted General Fund Tax Revenue.
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Debt Management Policy
The Board of Directors adopted a debt management policy on July 12, 2017. The stated purpose of the Debt
Management Policy is to establish the overall parameters for issuing, structuring, and administering the debt of
the District in compliance with applicable federal and State securities laws. The Debt Management Policy was
developed in conjunction with the procedures for Initial and Continuing Disclosure Relating to Bond Issuances,
with the latter ensuring that statements or releases of information to the public and investors relating to the finances
of the District are complete, true, and accurate in all material respects.
AWARDS
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of
Achievement to the District for its Comprehensive Annual Financial Report for the Fiscal Year Ended June 30,
2018. This was the second year that the District received this prestigious national award. The Certificate of
Achievement is the highest form of recognition in governmental accounting and financial reporting. To receive
the award, the District must publish a Comprehensive Annual Financial Report that is easily readable and
efficiently organized, and the contents of the report must conform to program standards and satisfy generally
accepted accounting principles and applicable legal requirements.
A Certificate of Achievement for Excellence in Financial Reporting is valid for one year. We believe that our
current report continues to conform to the Certificate requirements, and we are submitting it to the GFOA for
another award of the certificate.
ACKNOWLEDGEMENTS
The preparation of this Comprehensive Annual Financial Report could not have been completed without the
efforts and contributions of its Finance staff, as well as other departments across the District. Management also
wishes to acknowledge the invaluable assistance of Chavan & Associates, the District’s independent auditors who
contributed to the preparation of this Comprehensive Annual Financial Report.
Lastly, we wish to acknowledge the District’s Board of Directors for their continued interest and support of the
District’s effort to improve and strengthen its financial operations and reporting.
Respectfully submitted,
Ana Ruiz Stefan Jaskulak
General Manager Chief Financial Officer/
Director of Administrative Service
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Board of Directors & Management
Executive Management
Ana María Ruiz–General Manager
Hilary Stevenson–General Counsel
Mike Foster–Controller
Susanna Chan–Assistant General Manager/Project Planning and Delivery
Brian Malone–Assistant General Manager/Visitor and Field Services
Stefan Jaskulak–Chief Financial Officer/Director of Administrative Services
Mission Statement——————————————————————————––––––––––––——————————————————————————————
The mission of the Midpeninsula Regional Open Space District is to acquire and preserve a
regional greenbelt of open space land in perpetuity, protect and restore the natural environment,
and provide opportunities for ecologically sensitive public enjoyment and education.
District Wards Left to right: Zoe Kersteen-Tucker, Curt Riffle, Yoriko Kishimoto, Jed Cyr, Karen
Holman, Larry Hassett, Pete Siemens.
——————————————————————————––––––––––––————————————————————————————————Pete Siemens–Board President Ward 1: Cupertino, Los Gatos, Monte Sereno, Saratoga——————————————————————————––––––––––––————————————————————————————————
Yoriko Kishimoto–Board Treasurer Ward 2: Cupertino, Los Altos, Los Altos Hills, Palo Alto, Stanford, Sunnyvale ——————————————————————————––––––––––––————————————————————————————————
Jed Cyr Ward 3: Sunnyvale ——————————————————————————––––––––––––————————————————————————————————
Curt Riffle Ward 4: Los Altos, Mountain View ——————————————————————————––––––––––––————————————————————————————————Karen Holman–Board Vice President Ward 5: East Palo Alto, Menlo Park, Palo Alto, Stanford——————————————————————————––––––––––––————————————————————————————————
Larry Hassett Ward 6: Atherton, La Honda, Loma Mar, Menlo Park, Pescadero,
Portola Valley, Redwood City, San Gregorio, Woodside——————————————————————————––––––––––––————————————————————————————————
Zoe Kersteen-Tucker–Board Secretary Ward 7: El Granada, Half Moon Bay, Montara, Moss Beach, Princeton,
Redwood City, San Carlos, Woodside——————————————————————————––––––––––––————————————————————————————————
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Organizational Chart
Public
Board of
Directors ControllerGeneral
Counsel
General
Manager
Public Affairs
Department
Executive Assistant/
Deputy District Clerk
District Clerk/Assistant
to the General Manager
Visitor and Field Services
Assistant General Manager
Finance and Administrative
Services
CFO-Director of
Administrative Services
Project Planning and Delivery
Assistant General Manager
Visitor
Services
Department
Land and
Facilities
Department
Natural
Resources
Department
Planning
Department
Real
Property
Department
Engineering
and
Construction
Department
Budget and
Analysis
Department
Information
Systems and
Technology
Department
Finance
Department
Human
Resources
Department
Midpen At-A-Glance
Founded in 1972 63,927 Acres
(as of June 2019)
243 Miles of Trails 26 Preserves
183 Full-Time
Employees Over 2 Million
Visitors Per Year
$74.8 Million
Budget
760,000
Residents
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Regional Map
11
Achievement Award
12
Financial Section
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CHAVAN &ASSOCIATES,LLP
CERTIFIED PUBLIC ACCOUNTANTS
1475 Saratoga Ave, Suite 180, San Jose, CA 95129
Tel: 408-217-8749 • E-Fax: 408-872-4159
info@cnallp.com •www.cnallp.com
INDEPENDENT AUDITOR’S REPORT
Board of Directors
of the Midpeninsula Regional Open Space District
Los Altos,California
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities and each
major fund for Midpeninsula Regional Open Space District (the District), as of and for the year ended
June 30, 2019, and the related notes to the financial statements, which collectively comprise the
District’s basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
The District’s 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.
Auditor’s 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 District’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 District’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.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities and each major fund of the District, as of
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CHAVAN &ASSOCIATES,LLP
CERTIFIED PUBLIC ACCOUNTANTS
1475 Saratoga Ave, Suite 180, San Jose, CA 95129
Tel: 408-217-8749 • E-Fax: 408-872-4159
info@cnallp.com •www.cnallp.com
June 30, 2019, and the respective changes in financial position and 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 information for the general fund,
schedule of pension plan contributions, schedule of net pension liability proportionate share, schedule
of contributions for postemployment benefits, and schedule of changes in net OPEB liability, 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.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the District’s basic financial statements. The introductory section,budgetary
comparison information for the capital projects funds and the debt service fund,the schedule of
program expenditures for the Measure AA Bond Program,and the statistical sections are presented
for purposes of additional analysis and are not a required part of the basic financial statements.
The schedule of program expenditures for the Measure AA Bond Program is the responsibility of
management and was derived from and relates directly to the underlying accounting and other records
used to prepare the basic financial statements. 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 schedule of program expenditures for the Measure AA
Bond Program is fairly stated, in all material respects, in relation to the basic financial statements as a
whole.
The introductory section, budgetary comparison information for the capital projects funds and the
debt service fund,and statistical sections included 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.
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CHAVAN &ASSOCIATES,LLP
CERTIFIED PUBLIC ACCOUNTANTS
1475 Saratoga Ave, Suite 180, San Jose, CA 95129
Tel: 408-217-8749 • E-Fax: 408-872-4159
info@cnallp.com •www.cnallp.com
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated November
11, 2019 on our consideration of the District’s internal control over financial reporting and on our
tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements
and other matters. The purpose of that report is to describe the scope of our testing of internal control
over financial reporting and compliance and the results of that testing, and not to provide an opinion
on internal control over financial reporting or on compliance. That report is an integral part of an
audit performed in accordance with Government Auditing Standards in considering the District’s
internal control over financial reporting and compliance.
November 11, 2019
San Jose, California
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Management’s Discussion and Analysis
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Midpeninsula Regional Open Space District
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2019
INTRODUCTION
The purpose of the Management’s Discussion and Analysis (MD&A) is to present a discussion and analysis of the
District’s financial performance during the year ended on June 30, 2019. This report will (1) focus on significant
financial issues, (2) provide an overview of the District’s financial activity, (3) identify changes in the District’s
financial position, (4) identify any individual fund issues or concerns, and (5) provide descriptions of significant asset
and debt activity. This information, presented in conjunction with the annual Basic Financial Statements, is intended to
provide a comprehensive understanding of the District’s operations and financial standing.
Required Components of the Annual Financial Report
OVERVIEW AND USE OF THE FINANCIAL STATEMENTS
This annual report consists of a series of basic financial statements and notes. The statements are organized so the
reader can understand the District as an entire operating entity by providing an increasingly detailed look at specific
financial activities.
The Statement of Net Position and Statement of Activities is comprised of the government-wide financial statements
and provides information about the activities of the District as a whole, presenting both an aggregate view of the
District’s finances as well as a longer-term view of those finances. Fund Financial Statements provide the next level of
detail. For governmental funds, these statements reflect how services were financed in the short-term as well as what
remains for future spending. The Basic Financial Statements also include notes that explain some of the information in
the financial statements and provide more detailed data.
The full annual financial report is a product of three separate parts: the basic financial statements, supplementary
information, and this section, the Management’s Discussion and Analysis. The three sections together provide a
comprehensive financial overview of the District. The basic financials are comprised of two kinds of statements that
present financial information from different perspectives, government-wide and fund statements.
Government-wide financial statements, which comprise the first two statements, provide both short-term and long-
term information about the District’s overall financial position.
Individual parts of the District, which are reported as fund financial statements, focus on reporting the District’s
operations in more detail. These fund financial statements comprise the remaining statements.
Management’s
Discussion & Analysis
Government-Wide
Financial Statements
Fund
Financial Statements
Notes to the
Financial Statements
Basic
Financial Statements
18
Midpeninsula Regional Open Space District
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2019
Notes to the financial statements, provide more detailed data and provide explanations to some of the information
in the statements. The required supplementary information section provides further explanations and additional
support for the financial statements.
GOVERNMENT-WIDE FINANCIAL STATEMENTS - STATEMENT OF NET POSITION AND THE STATEMENT OF
ACTIVITIES
The view of the District as a whole looks at all financial transactions and asks the question, “How did we do financially
during the fiscal year 2018-2019?” The Statement of Net Position and the Statement of Activities answers this question.
These statements include all assets and liabilities using the accrual basis of accounting similar to the accounting
practices used by most private-sector companies. This basis of accounting takes into account all of the current year
revenues and expenses regardless of when cash is received or paid.
These two statements report the District’s net position and changes in net position. This change in net position is
important because it tells the reader that, for the District as a whole, whether the financial position of the District has
improved or diminished. The causes of this change may be the result of many factors, some financial, and some not.
Non-financial factors include the District’s property tax base, current property tax laws in California restricting revenue
growth, facility conditions and other factors.
In the Statement of Net Position and the Statement of Activities, the District reports governmental activities which
reflect the District’s programs and services. The District does not have any business type activities.
FINANCIAL HIGHLIGHTS
As the overall economy continued to grow throughout the Silicon Valley, the District witnessed further strong growth
in the assessed valuation of both secured and unsecured property within its boundaries. The 2018-19 assessed
valuation reports released in August 2018 showed District-wide assessed values increasing by 7.3% (7.2% in Santa
Clara and 7.4% in San Mateo). The District received 67% of its tax revenue from Santa Clara County and 33% from
San Mateo County.
Other financial highlights included:
Tax revenue related to the GO bonds amounted to $5.2 million.
Purchased $2.2 million in land and associated structures funded through Measure AA GO bond proceeds.
Purchased a commercial office building and associated land for $31.5 million which will serve as the District’s
new administrative headquarters.
The District’s Section 115 irrevocable trust for pension liabilities held with the Public Agency Retirement
Services (PARS)has a value of $2,531,030 at year end.
Fully funded the District’s other postemployment benefits plan according to the actuarially determined
contribution for current year, as noted in the schedule of contribution for postemployment benefits.
The assets of the District exceeded liabilities at the close of the 2019 fiscal year by $367 million. Of this total net
position, $351 million, or 96%, was the District’s net investment in capital assets (capital assets net of related debt).
19
Midpeninsula Regional Open Space District
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2019
REPORTING THE DISTRICT’S MOST SIGNIFICANT FUNDS
Fund Financial Statements
Fund financial reports provide detailed information about the District’s major funds. The District uses one operating
fund, the General Fund, to account for a multitude of financial transactions, two capital project funds to account for
capital projects, and one debt service fund to account for debt service payments.
Governmental Funds
The General Fund is a governmental fund type and is reported using an accounting method called modified accrual
accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental
fund statements provide a detailed short-term view of the District’s general government operations and the basic
services it provides. Governmental fund information helps determine whether there are more or fewer financial
resources that can be spent in the future to finance educational programs. The relationship (or differences)between
governmental activities (reported in the Statement of Net position and the Statement of Activities) and governmental
funds is reconciled in the financial statements.
THE DISTRICT AS A WHOLE
Recall that the Statement of Net Position provides the perspective of the District as a whole.Table 1 provides a
summary of the District’s net position as compared to last period:
Percentage
2019 2018 Change Change
As sets
Current As sets 108,643,304$ 135,924,361$(27,281,057)$-20.07%
Othe r No ncur rent As sets 562,532 637,906 (75,374) -11.82%
Capi tal As sets 504,559,409 462,119,833 42,439,576 9.18%
To tal As sets 613,765,245$ 598,682,100$15,083,145$ 2.52%
To tal De ferred Out flows of Re sources 14,826,493$ 17,804,789$ (2,978,296)$ -16.73%
Li abi lities
Cur rent Li abi lities 16,695,948$ 14,219,357$ 2,476,591$ 17.42%
No ncur rent Li abi lities 243,049,767 252,063,016 (9,013,249) -3.58%
To tal Li abi lities 259,745,715$ 266,282,373$(6,536,658)$ -2.45%
To tal De ferred Inf lows of Re sources 1,471,865$ 1,416,399$ 55,466$ 3.92%
Ne t Posi ti on
Ne t Investment in Capi tal As sets 351,151,768$ 312,120,869$39,030,899$ 12.51%
Re stricted 8,207,641 7,252,294 955,347 13.17%
Unr estricted 8,014,749 29,414,954 (21,400,205) -72.75%
To tal Ne t Position 367,374,158$ 348,788,117$18,586,041$ 5.33%
Ta bl e 1 - Summar y o f St at ement of Ne t Posi ti on
Total net position increased by $18.6 million, as revenues exceeded expenditures. Current assets decreased due mostly
to $45.3 million of capital expenditures.
20
Midpeninsula Regional Open Space District
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2019
Table 2 shows the changes in net position for 2019 as compared to period 2018.
Percentage
2019 2018 Change Change
Re ve nue s
Program revenue s 3,442,075$ 3,189,096$ 252,979$ 7.93%
Ge ne ral revenue s:
Property taxe s 54,395,054 47,798,349 6,596,705 13.80%
Investment earnings 3,627,639 1,045,124 2,582,515 247.10%
Miscellane ous 1,874,272 1,152,611 721,661 62.61%
To tal Re ve nue s 63,339,040 53,185,180 10,153,860 19.09%
Program Expe ns es
Land pr eservat ion 34,304,215 28,909,830 5,394,385 18.66%
Int erest 10,448,784 8,193,228 2,255,556 27.53%
Depr eciation - 2,398,894 (2,398,894) -100.00%
To tal Expe ns es 44,752,999 39,501,952 5,251,047 13.29%
Chang e in Net Posi ti on 18,586,041 13,683,228 4,902,813 35.83%
Ad jus tment to Beginning Net Posi ti on - (1,898,023) 1,898,023 100.00%
Begi nning Ne t Positi on 348,788,117 337,002,912 11,785,205 3.50%
Endi ng Ne t Positi on 367,374,158$ 348,788,117$ 18,586,041$ 5.33%
Ta bl e 2 - Summar y o f Chang es in Ne t Positi on
THE DISTRICT’S FUND BALANCE
Table 3 provides an analysis of the District’s fund balances and the total change in fund balances from the prior year.
Measure AA Debt
General Capital GF Capital Service Percentage
Fund Projects Fund Projects Fund Fund Total 2018 Change
Nonspendable for prepaid expenditure 185,984$ -$ -$ -$ 185,984$ 35,968$ 417%
Restricted for debt service - - - 6,775,924 6,775,924 5,791,164 17%
Restricted for Measure AA Projects - 37,944,253 - - 37,944,253 46,468,809 -18%
Restricted for Hawthorne maintenance 1,431,717 - - - 1,431,717 1,466,982 -2%
Restricted for capital projects - - 8,254,539 - 8,254,539 7,043,765 17%
Restricted for pension 2,531,030 - - - 2,531,030 - 100%
Committed for in frastructure 17,688,465 - - - 17,688,465 44,000,000 -60%
Committed for equipment replacement 3,000,000 - - - 3,000,000 3,000,000 0%
Committed for natural disasters - - - - - 3,000,000 -100%
Committed for capital maintenance 5,000,000 - - - 5,000,000 2,000,000 150%
Committed for future acquisitions
and capital projects 3,000,000 - - - 3,000,000 3,000,000 0%
Committed for promissory note 600,000 - - - 600,000 300,000 100%
As signed for ongoing projects 1,400,000 - - - 1,400,000 - 100%
Unassign ed 16,515,392 - - - 16,515,392 16,306,537 1%
Total Fund Balance 51,352,588$37,944,253$ 8,254,539$ 6,775,924$104,327,304$132,413,225$-22%
Ta ble 3 - Summary of Fund Balance (All Go vernmental Funds)
2019
Following the District’s thirty-year strategic plan, the Board of Directors committed a majority of the unassigned fund
balance during fiscal year 2019 to reserves for infrastructure, equipment replacement and capital maintenance. See
Note 1 in the notes to the basic financial statements of the audit report for a description of each commitment.
21
Midpeninsula Regional Open Space District
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2019
GENERAL FUND BUDGETING HIGHLIGHTS
The District’s budget is prepared according to California law and in the modified accrual basis of accounting.
During the course of 2019, the District revised its General Fund budget, which resulted in an decrease in budgeted
expenditures of $122 thousand from the original to final budget. The revenue was revised from $51 million to $53
million due to increases in property taxes and interest earned from investments.A summary of the original and final
budget is presented below:
Percent
Or iginal Budge t Fi nal Budge t Change Change
Re ve nue s
Property t axe s 48,122,000$ 48,919,000$ 797,000$ 1.66%
Gr ant revenue s 191,000 191,000 - 0.00%
Property manage me nt 1,221,124 1,043,000 (178,124) -14.59%
Investment earnings 1,079,000 1,949,904 870,904 80.71%
Ot he r revenue s 471,738 1,158,498 686,760 145.58%
To tal Re ve nue s 51,084,862 53,261,402 2,176,540 4.26%
Expe ndi tures
Sal ar ies and e mpl oyee bene fits 22,930,309 23,155,369 225,060 0.97%
Se rvices and s uppl ies 10,648,125 10,384,065 (264,060) -2.54%
Capi tal outlay 83,000 - (83,000) -100.00%
To tal Expe ns es 33,661,434 33,539,434 (122,000) -0.36%
Ne t Chang e in F und B al anc e 17,423,428$ 19,721,968$ 2,298,540$ 13.19%
Ta bl e 4 - Summar y o f Or iginal t o Fi nal B udg ets
CAPITAL ASSETS
Table 5 shows 2019 capital asset balances as compared to 2018.
Percentage
2019 2018 Change Change
Land 437,763,645$ 414,547,441$ 23,216,204$ 5.60%
Co ns truction-in-Progress 16,193,374 8,596,297 7,597,077 88.38%
St ructure and Impr ovements 18,059,730 7,320,057 10,739,673 146.72%
Inf rastructure 29,542,214 28,512,084 1,030,130 3.61%
Equi pme nt 1,113,614 989,551 124,063 12.54%
Ve hi cles 1,886,832 2,154,403 (267,571) -12.42%
To tal Capi tal As sets - Ne t 504,559,409$ 462,119,833$ 42,439,576$ 9.18%
Ta bl e 5 - Summar y o f Capi tal As sets Ne t of De pr eci at ion
Additional detail and information on capital asset activity is described in the notes to the financial statements, note 5.
22
Midpeninsula Regional Open Space District
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2019
LONG TERM LIABILITIES
Table 6 summarizes the changes in long-term liabilities from 2019 to 2018.
Percentage
2019 2018 Change Change
Promissory Notes 38,899,934$ 39,769,276$ (869,342)$ -2.19%
Bo nds 199,505,576 205,905,916 (6,400,340) -3.11%
Ne t Pension Liabi lity 10,412,478 11,022,824 (610,346) -5.54%
Ne t OP EB Li abi lity 1,862,277 1,845,000 17,277 0.94%
Co mpe ns at ed Abs ences 2,368,387 1,723,930 644,457 37.38%
To tal Lo ng-term Liabi lities 253,048,652$260,266,946$(7,218,294)$ -2.77%
Ta bl e 6 - Summar y o f Lo ng -term Li abi lities
Additional detail and information on long-term liabilities activity is described in the notes to the financial
statements, note 6.
ECONOMIC FACTORS AND NEXT YEAR’S BUDGET
The Board of Directors adopted the District’s budget for fiscal year 2019-20 on June 26, 2019. This budget assumes
$64.4 million in revenues and a growth in general fund property tax income of 7.75% over the prior year’s adopted
budget. This budget funds $20.0 million of capital spending, of which $9.5 million is expected to qualify for
reimbursement from Measure AA GO bond funds.General Fund operating expenditures are budgeted at $37.0 million,
a 10.3% increase over the prior year’s budget. Debt service is budgeted at $17.7 million, with $7.3 million related to
the Measure AA general obligation bonds. If all revenues, expenditures (including debt service) occur as budgeted, the
District’s overall cash balances would increase by approximately $0.7 million.
CONTACTING THE DISTRICT’S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, parents, participants, investors and creditors with a
general overview of the District’s finances and to demonstrate the District’s accountability for the money it receives.
Questions concerning any of the information provided in this report or requests for additional financial information
should be addressed to the Administrative Office, Midpeninsula Regional Open Space District, 330 Distel Circle, Los
Altos, California 94022.
23
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24
Basic Financial Statements
25
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26
GOVERNMENT-WIDE STATEMENTS
Statement of Net Position and Statement of Activities
The Statement of Net Position and the Statement of Activities summarize the entire District’s financial activities
and financial position.They are prepared on the same basis as is used by most businesses,which means they
include all the District’s assets and all its liabilities,as well as all its revenues and expenses.This is known as the
full accrual basis.The effect of all of the District’s transactions is taken into account,regardless of whether or
when cash changes hands, but all material internal transactions between District funds have been eliminated.
The Statement of Net Position reports the difference between the District’s total assets and the District’s total
liabilities,including all the District’s capital assets and all its long-term debt.The Statement of Net Position
presents information in a way that focuses the reader on the composition of the District’s net position,by
subtracting total liabilities from total assets.
The Statement of Net Position summarizes the financial position of all of the District’s Governmental Activities
in a single column.The District’s Governmental Activities include the activities of its General Fund,along with
all its Special Revenue Funds, Capital Projects Funds, and Debt Service Funds.
The Statement of Activities reports increases and decreases in the District’s net position.It is also prepared on
the full accrual basis,which means it includes all the District’s revenues and all its expenses,regardless of when
cash changes hands.This differs from the “modified accrual”basis used in the Fund financial statements,which
reflect only current assets, current liabilities, available revenues and measurable expenditures.
The Statement of Activities presents the District’s expenses first,listed by program.Program revenues –that is,
revenues which are generated directly by these programs -are then deducted from program expenses to arrive at
the net expense of each governmental program.The District’s general revenues are then listed in the
Governmental Activities and the Change in Net Position is computed and reconciled with the Statement of Net
Position.
Both these Statements include the financial activities of the District and the Midpeninsula Regional Open Space
District Financing Authority.This entity is legally separate but is a component unit of the District because it is
controlled by the District, which is financially accountable for the Authority’s activities.
27
Assets
Current assets:
Cash and investments 108,106,556$
Accounts receivable:
Interest 158,943
Other 182,269
Taxes receivable 221
Other current assets 195,315
Total current assets 108,643,304
Noncurrent assets:
Notes receivable 94,182
Un amortized issuance costs 468,350
Non-depreciable capital assets 453,957,019
Capital assets, net of depreciation 50,602,390
Total noncurrent assets 505,121,941
Total Assets 613,765,245$
Deferred Outflows of Resources
OPEB adjustments 670,768$
Pension adjustments 4,760,025
Deferred loss on early retirement of long-term debt 9,395,700
Total Deferred Outflows of Resources 14,826,493$
Liabilities
Current liabilities:
Accounts payable 2,516,839$
Deposits payable 218,240
Payroll and other liabilities 1,580,921
Accrued interest 2,381,063
Current portion of long-term liabilities 9,998,885
Total current liabilities 16,695,948
Noncurrent liabilities:
Long-term liabilities - net of current portion 243,049,767
Total Liabilities 259,745,715$
Deferred Inflows of Resources
OPEB adjustments 92,510$
Pension adjustments 1,379,355
Total Deferred Outflows of Resources 1,471,865$
Net Position
Net investment in capital assets 351,151,768$
Restricted for:
Debt service 6,775,924
Hawthorne maintenance 1,431,717
Total restricted 8,207,641
Un restricted 8,014,749
Total Net Position 367,374,158$
Midpeninsula Regional Open Space District
Statement of Net Position
June 30, 2019
The notes to the financial statements are an integral part of this statement.
28
Net (Expense)
Capital Revenue and
Charges for Grants and Changes in
Expenses Services Contributions Net Position
Governmental activities:
Land preservation 34,304,215$ 2,360,364$ 1,081,711$ (30,862,140)$
Interest and fiscal charges 10,448,784 - - (10,448,784)
Total governmental activities 44,752,999$ 2,360,364$ 1,081,711$ (41,310,924)
General revenues and special item:
Property taxes 54,395,054
Investment earnings 3,627,639
Other revenues 1,912,125
Special item - loss on disposal of capital assets (37,853)
Total general revenues and special item 59,896,965
Change in net position 18,586,041
Net position beginning 348,788,117
Net position ending 367,374,158$
Midpeninsula Regional Open Space District
Statement of Activities
For the Fiscal Year Ended June 30, 2019
Program Revenues
The notes to the financial statements are an integral part of this statement.
29
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30
Fund Title Fund Description
General Fund The fund is the general operating fund of the District. It is used to
account for all financial resources. The major revenue sources for this
fund are property taxes, grant revenues and interest income.
Expenditures are made for land preservation and other operating
expenditures.
Measure AA Capital Projects Fund This fund is used to account for resources from bond proceeds and
expenditures for capital projects related to the Measure AA GO Bond.
GF Capital Projects Fund This fund is used to account for expenditures for capital projects not
related to any other capital projects funds.
Debt Service Fund This fund is used to account for accumulation of resources for, and the
payment of long-term debt principal, interest and related costs.
Resources are provided by General Fund transfers and interest income
on unspent funds.
FUND FINANCIAL STATEMENTS
MAJOR GOVERNMENTAL FUNDS
The funds described below were determined to be Major Funds by the District in fiscal year 2018.
31
Measure AA GF Capital Debt Total
General Capital Projects Service Governmental
Fund Projects Fund Fund Fund Funds
Assets
Cash and investments 51,295,862$ 41,130,060$ 8,904,710$ 6,775,924$ 108,106,556$
Receivables:
Interest 158,943 - - - 158,943
Other 182,269 - - - 182,269
Taxes receivable 221 - - - 221
Other current assets 195,315 - - - 195,315
Due from other funds 4,565,422 2,786,475 - - 7,351,897
Notes receivable 94,182 - - - 94,182
Total Assets 56,492,214$ 43,916,535$ 8,904,710$ 6,775,924$ 116,089,383$
Liabilities
Liabilities:
Accounts payable 770,967$ 1,450,793$ 295,079$ -$ 2,516,839$
Deposits payable 218,240 - - - 218,240
Due to other funds 2,475,316 4,521,489 355,092 - 7,351,897
Payroll and other liabilities 1,580,921 - - - 1,580,921
Total Liabilities 5,045,444 5,972,282 650,171 - 11,667,897
Deferred Inflows of Resources
Unavailable revenues 94,182 - - - 94,182
Fund Balance
Nonspendable:
Prepaid expenditures 185,984 - - - 185,984
Restricted for:
Debt service - - - 6,775,924 6,775,924
Measure AA capital projects - 37,944,253 - - 37,944,253
Hawthorne maintenance 1,431,717 - - - 1,431,717
Capital projects - - 8,254,539 - 8,254,539
Pension 2,531,030 - - - 2,531,030
Committed for:
Infrastructure 17,688,465 - - - 17,688,465
Equipment replacement 3,000,000 - - - 3,000,000
Capital maintenance 5,000,000 - - - 5,000,000
Future acquisitions and capital
projects 3,000,000 - - - 3,000,000
Promissory note 600,000 - - - 600,000
Assigned for:
Ongoing Projects 1,400,000 - - - 1,400,000
Unassigned 16,515,392 - - - 16,515,392
Total Fund Balance 51,352,588 37,944,253 8,254,539 6,775,924 104,327,304
Total Liabilities, Deferred Inflows
of Resources, and Fund Balance 56,492,214$ 43,916,535$ 8,904,710$ 6,775,924$ 116,089,383$
Balance Sheet
Midpeninsula Regional Open Space District
June 30, 2019
Governmental Funds
The notes to the financial statements are an integral part of this statement.
32
Total fund balance - governmental funds 104,327,304$
Amounts reported in the Statement of Net Position are different because:
Capital assets used in governmental activities are not financial resources and therefore are not
reported as assets in governmental funds.
Capital assets at cost 524,853,989$
Accumulated depreciation (20,294,580) 504,559,409
Principal on notes receivables are recorded as unearned revenue in the funds, which upon
collection is a current financial resource. In the government-wide financial statements,
repayment of the principal amount does not generate revenue in the statement of activities;
therefore, unearned revenue is not recorded.94,182
The difference between OPEB plan assumptions and estimates versus actuals are not included in the
plan's actuarial study until the next fiscal year and are reported as deferred outflows or
inflows of resources in the statement of net position.578,258
The difference between pension plan assumptions and estimates versus actuals are not included in the
plan's actuarial study until the next fiscal year and are reported as deferred outflows or
inflows of resources in the statement of net position.3,380,670
Interest payable on long-term debt does not require the use of current financial resources and,
therefore, is not reported in the governmental funds.(2,381,063)
Discounts and premiums related to bond issues are recorded as other financing
sources and uses in the fund financial statements but are recorded as assets or liabilities
and amortized over the life of the bond in the statement of net position:
Premium 25,567,399$
Issuance cost (468,350) (25,099,049)
Deferred loss on early retirement of long-term debt is recorded in the Statement of Net Position as a deferred
outflow of resources and amortized on a straight line basis over the original life of the defeased bond.9,395,700
Long-term liabilities are not due and payable in the current year and therefore are not reported
as liabilities in the funds. Long-term liabilities at year-end consists of:
Bon ds 179,090,000$
Net pension liability 10,412,478
Promissory notes 33,748,111
Compensated absences 2,368,387
Net OPEB liability 1,862,277 (227,481,253)
Total net position - governmental activities 367,374,158$
Midpeninsula Regional Open Space District
Balance Sheet to the Statement of Net Position
June 30, 2019
Reconciliation of the Governmental Funds
The notes to the financial statements are an integral part of this statement.
33
Measure AA GF Capital Debt Total
General Capital Projects Service Governmental
Fund Projects Fund Fund Fund Funds
Revenues:
Property taxes 49,156,904$ -$ -$ 5,238,150$ 54,395,054$
Grant income 460,842 620,869 - - 1,081,711
Property management 2,360,364 - - - 2,360,364
Investment earnings 1,403,878 1,726,441 399,613 118,773 3,648,705
Other revenues 640,850 - - - 640,850
Total revenues 54,022,838 2,347,310 399,613 5,356,923 62,126,684
Expenditures:
Current:
Land preservation:
Salaries and employee benefits 20,727,559 368,306 - - 21,095,865
Services and supplies 8,086,707 2,054 1,334 - 8,090,095
Capital outlay - 10,501,506 34,854,151 - 45,355,657
Debt service:
Principal - - - 6,480,000 6,480,000
Interest - - - 9,190,988 9,190,988
Total expenditures 28,814,266 10,871,866 34,855,485 15,670,988 90,212,605
Excess (deficiency) of revenues
over (under) expenditures 25,208,572 (8,524,556) (34,455,872) (10,314,065) (28,085,921)
Other financing sources (uses):
Transfers in 1,481,755 - 37,148,401 11,298,825 49,928,981
Transfers out (48,447,226) - (1,481,755) - (49,928,981)
Total other financing sources (uses)(46,965,471) - 35,666,646 11,298,825 -
Net changes in fund balance (21,756,899) (8,524,556) 1,210,774 984,760 (28,085,921)
Fund balance beginning 73,109,487 46,468,809 7,043,765 5,791,164 132,413,225
Fund balance ending 51,352,588$ 37,944,253$ 8,254,539$ 6,775,924$ 104,327,304$
Midpeninsula Regional Open Space District
Statement of Revenues, Expenditures and Changes in Fund Balance
Governmental Funds
For the Fiscal Year Ended June 30, 2019
The notes to the financial statements are an integral part of this statement.
34
Total net change in fund balance - governmental funds (28,085,921)$
Capital outlays are reported in governmental funds as expenditures. However, in the Statement of Activities, the
cost of those assets is allocated over their estimated useful lives as depreciation expense.
Expenditures capitalized as capital assets 45,355,657$
Depreciation expense (2,878,228)
Loss on disposal of capital asset (37,853) 42,439,576
Repayment of notes receivable is reported as revenue in the governmental funds because financial resources
were received and available during the fiscal year. In the statement of net position, the payment reduces
the principal balance of notes receivable and does not generate revenue in the statement of activities.(21,066)
Accreted interest on capital appreciation bonds is not recorded in the governmental funds but is required
to be recorded under the accrual basis of accounting in the government wide financial statements.(481,593)
The governmental funds report debt proceeds as an other financing source, while repayment of debt principal is
reported as an expenditure. Interest is recognized as an expenditure in the governmental funds when it is due.
The net effect of these differences in the treatment of long-term debt and related items is as follows:
Repayment of bond principal 5,280,000
Repayment of promissory notes principal 1,200,000 6,480,000
Deferred loss on early retirement of long-term debt is amortized over the life of the debt in the statement of
activities. Amortization expense is not reported in the governmental funds.(845,123)
Prepaid issuance costs, discounts and premiums related to bond issues are recorded as other financing
sources and uses in the fund financial statements but are recorded as assets or liabilities
and amortized over the life of the bond in the statement of net position:
Amortization of issuance costs and premiums - net 1,216,967
In the Statement of Activities, compensated absences are measured by the amount earned during the year. In
governmental funds, however, expenditures for those items are measured by the amount of financial
resources used (essentially the amounts paid). This year, vacation earned exceeded the amounts used.(644,457)
In governmental funds, actual contributions to pension and OPEB plans are reported as expenditures in the
year incurred. However, in the government-wide statement of activities, only the current year pension
and OPEB expense as noted in the plans' valuation reports is reported as an expense, as adjusted for
deferred inflows and outflows of resources.(1,595,570)
Interest on long-term debt in the Statement of Activities differs from the amount reported in the governmental funds
because interest is recognized as an expenditure in the funds when it is due and thus requires the use of
current financial resources. In the Statement of Activities, however, interest expense is recognized as the interest
accrues, regardless of when it is due.123,228
Change in net position of governmental activities 18,586,041$
Midpeninsula Regional Open Space District
Statement of Revenues, Expenditures and Changes in Fund Balance
For the Fiscal Year Ended June 30, 2019
Reconciliation of the Governmental Funds
to the Statement of Activities
The notes to the financial statements are an integral part of this statement.
35
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36
Notes to Financial Statements
37
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
NOTE 1 -SIGNIFICANT ACCOUNTING POLICIES
A.General
The Midpeninsula Regional Open Space District (the District)was formed in 1972 to acquire and
preserve public open space land in northern and western portions of Santa Clara County. In June
1976, the southern and eastern portions of San Mateo County were annexed to the District. The
District annexed a small portion of the northern tip of Santa Cruz County in 1992. In September 2004,
the District completed the Coastside Protection Program, which extended the District boundaries to
the Pacific Ocean in San Mateo County, from the southern borders of Pacifica to the San Mateo/Santa
Cruz County line.
B.Accounting Principles
The accounting policies of the District conform to generally accepted accounting principles as
prescribed by the Governmental Accounting Standards Board (GASB)and the American Institute of
Certified Public Accountants (AICPA).
C.Reporting Entity
As required by generally accepted accounting principles, these basic financial statements present the
Midpeninsula Regional Open Space District and its component unit. The component unit discussed in
the following paragraph is included in the District's reporting entity because of the significance of
their operational or financial relationships with the District.
Blended Component Unit. The District and the County of Santa Clara entered into a joint exercise
of powers agreement dated May 1, 1996, creating the Midpeninsula Regional Open Space District
Financing Authority (the Authority), pursuant to the California Government Code. The District is
financially accountable for the Authority, as it appoints a voting majority of the governing board; is
able to impose its will in the Authority; and the Authority provides specific financial benefits to, and
imposes specific financial burdens on, the District. The Authority was formed for the sole purpose of
providing financing assistance to the District to fund the acquisition of land to preserve and use as
open space. As such, the Authority is an integral part of the District, and accordingly, all of the
Authority's activity is blended within the accompanying debt service fund.
D.Basis of Presentation
Government-wide Financial Statements:
The government-wide financial statements (i.e., the Statement of Net Position and the Statement of
Activities) report information on all of the activities of the District.The Statement of Net Position
reports all assets, deferred outflows of resources, liabilities, deferred inflows of resources, and net
position.
The government-wide statements are prepared using the economic resources measurement focus. This
approach differs from the manner in which governmental fund financial statements are prepared.
Governmental fund financial statements, therefore, include the reconciliation with brief explanations
to better identify the relationship between the government wide statements and the statements for the
governmental funds.
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Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
The government-wide statement of activities presents a comparison between direct expenses and
program revenues for each function or program of the District’s governmental activities. Direct
expenses are those that are specifically associated with a service, program, or department and are
therefore clearly identifiable to a particular function. The District does not allocate indirect expenses
to functions in the statement of activities. Program revenues include charges paid by the recipients of
goods or services offered by a program, as well as grants and contributions that are restricted to
meeting the operational or capital requirements of a particular program. Revenues that are not
classified as program revenues are presented as general revenues of the District, with certain
exceptions. The comparison of direct expenses with program revenues identifies the extent to which
each governmental function is self-financing or draws from the general revenues of the District.
Fund Financial Statements:
Fund financial statements report detailed information about the District. The accounting and financial
treatment applied to a fund is determined by its measurement focus. All governmental funds are
accounted for using a flow of current financial resources measurement focus. With this measurement
focus, only current assets, deferred outflows,current liabilities and deferred inflows are generally
included on the balance sheet. The Statement of Revenues, Expenditures, and Changes in Fund
Balance for these funds present increases (i.e., revenues and other financing sources) and decreases
(i.e., expenditures and other financing uses) in net current assets.
E.Basis of Accounting
Basis of accounting refers to when revenues and expenditures are recognized in the accounts and
reported in the financial statements.Government-wide financial statements are prepared using the
accrual basis of accounting.Governmental funds use the modified accrual basis of accounting.
Revenues -Exchange and Non-exchange Transactions:
Revenue resulting from exchange transactions, in which each party gives and receives essentially
equal value, is recorded under the accrual basis when the exchange takes place. On a modified accrual
basis, revenue is recorded in the fiscal period in which the resources are measurable and become
available. “Available” means the resources will be collected within the current fiscal period or are
expected to be collected soon enough thereafter to be used to pay liabilities of the current fiscal
period. For the District, “available” means collectible within the current period or within 90 days after
period-end.
Non-exchange transactions, in which the District receives value without directly giving equal value in
return, include property taxes, grants, and entitlements. Under the accrual basis, revenue from
property taxes is recognized in the fiscal period for which the taxes are levied. Revenue from grants
and entitlements is recognized in the fiscal period in which all eligibility requirements have been
satisfied. Eligibility requirements include timing requirements, which specify the period when the
resources are to be used or the fiscal period when use is first permitted; matching requirements, in
which the District must provide local resources to be used for a specific purpose; and expenditure
requirements, in which the resources are provided to the District on a reimbursement basis. Under the
modified accrual basis, revenue from non-exchange transactions must also be available before it can
be recognized.
39
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
Deferred Outflows/Deferred Inflows:
A deferred outflow of resources is defined as a consumption of net position that applies to a future
period(s) and so will not be recognized as an outflow of resources (expenses/expenditure)until then.
A deferred inflow of resources is defined as an acquisition of net position that applies to a future
period(s) and so will not be recognized as an inflow of resources (revenues) until that time.
When applicable, unamortized portions of the gain and loss on refunding debt are reported as deferred
inflows and deferred outflows of resources, respectively. Deferred outflows and inflows of resources
are reported for the changes related to benefit plans. In addition, when an asset is recorded in
governmental fund financial statements but the revenue is not available, a deferred inflow of
resources is reported until such time as the revenue becomes available.
Unearned Revenue:
Unearned revenue arises when assets (such as cash)are received before revenue recognition criteria
have been satisfied. Grants and entitlements received before eligibility requirements (such as
qualified expenditures)are met are recorded as liabilities from unearned revenue.
Unavailable Revenue:
In the governmental fund financial statements, receivables associated with non-exchange transactions
that will not be collected within the availability period have been recorded as deferred inflows of
resources as unavailable revenue.
Expenses/Expenditures:
On the accrual basis of accounting, expenses are recognized at the time a liability is incurred. On the
modified accrual basis of accounting, expenditures are generally recognized in the accounting period
in which the related fund liability is incurred, as under the accrual basis of accounting. However,
under the modified accrual basis of accounting, debt service expenditures, as well as expenditures
related to compensated absences and claims and judgments, are recorded only when payment is due.
Allocations of cost, such as depreciation and amortization, are not recognized in the governmental
funds. When both restricted and unrestricted resources are available for use, it is the District’s policy
to use restricted resources first, then unrestricted resources as they are needed.
F.Fund Accounting
The accounts of the District are organized into four funds with a separate set of self-balancing
accounts that comprise of the District’s assets, deferred outflows, liabilities, deferred inflows, fund
balance, revenues, and expenditures.The District resources are allocated to and accounted for in
individual funds based upon the purpose for which they are to be spent and the means by which
spending activities are controlled.
Major funds are defined as funds that have either assets, liabilities, revenues or expenditures/expenses
equal to ten percent of their fund-type total and five percent of the grand total. The General Fund is
always a major fund. The District may also select other funds it believes should be presented as major
funds.
40
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
The District reported all of its funds as major governmental funds in the accompanying financial
statements:
General Fund. The General Fund is the general operating fund of the District. It is used to account
for all financial resources. The major revenue sources for this fund are property taxes, grant revenues
and interest income. Expenditures are made for land preservation and other operating expenditures.
Measure AA Capital Projects Fund. The Measure AA Capital Projects Fund is used to account for
resources from bond proceeds and expenditures for capital projects related to the Measure AA GO
Bond.
GF Capital Projects Fund. GF Capital Projects Fund is used to account for expenditures for capital
projects not related to any other capital projects funds.
Debt Service Fund. The Debt Service Fund is used to account for accumulation of resources for, and
the payment of long-term debt principal, interest and related costs. Resources are provided by General
Fund transfers and interest income on unspent funds.
G.Budgets and Budgetary Accounting
The District's Board of Directors adopts an annual operating budget for the District by major fund,on
or before June 30, for the ensuing fiscal period. The Board of Directors may amend the budget by
resolution during the fiscal period. The legal level of control, the level at which expenditures may not
legally exceed the budget, is at the category level.
H.Assets, Liabilities, and Equity
1. Cash and Cash Equivalents
The District’s cash deposits are considered to be cash on hand and cash in banks. Cash and
Cash Equivalents are generally considered short-term, highly liquid investments with a
maturity of three months or less from the purchase date.
2.Investments
Investments are recorded at fair value in accordance with GASB Statement No. 72,Fair Value
Measurement and Application. Accordingly, the change in fair value of investments is
recognized as an increase or decrease to investment assets and investment income. Fair value is
defined as the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction. In determining this amount, three valuation techniques are available:
Market approach -This approach uses prices generated for identical or similar assets or
liabilities. The most common example is an investment in a public security traded in an
active exchange such as the NYSE.
Cost approach -This technique determines the amount required to replace the current
asset. This approach may be ideal for valuing donations of capital assets or historical
treasures.
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Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
Income approach -This approach converts future amounts (such as cash flows) into a
current discounted amount.
Each of these valuation techniques requires inputs to calculate a fair value. Observable inputs
have been maximized in fair value measures, and unobservable inputs have been minimized.
3.Prepaid Expenditures
The District has the option of reporting expenditures in governmental funds for prepaid items
either when purchased or during the benefiting period. The District has chosen to report the
expenditure during the benefiting period.
4.Capital Assets
Capital assets, which include land, buildings and improvements, furniture, equipment, and
construction in progress, are reported in the government-wide financial statements. Capital assets
are valued at cost when historical records are available and at an estimated historical cost when no
historical records exist. Donated capital assets are valued at their acquisition value at the time of
acquisition plus ancillary charges,if any. Donated works of art and similar items and capital assets
received in service concession arrangements are reported at acquisition value. The District utilizes a
capitalization threshold of $1 for land, $25,000 for equipment, fixtures and vehicles, $50,000 for
infrastructure,improvements, buildings and structures.
Projects under construction are recorded at cost as construction in progress and transferred to the
appropriate asset account when substantially complete. Costs of major improvements and
rehabilitation of buildings are capitalized. Repair and maintenance costs are charged to expense
when incurred. Equipment disposed of, or no longer required for its existing use, is removed from
the records at actual or estimated historical cost, net of accumulated depreciation.
All capital assets, except land and construction in progress, are depreciated using the straight-line
method over the following estimated useful lives:
Assets Years
Structures/Improvements 50
Public Access Infrastructure 20 - 50
Equipment/Fixtures 5 -20
Vehicles 5
Software 5 - 10
5.Compensated Absences
In accordance with the District's memorandum of understanding with various employee groups,
employees accrue fifteen days of vacation during the first nine years of service, twenty days
between service years 10 and fourteen, twenty-one days between service years fifteen and
nineteen, twenty-three days between service years twenty and twenty-four, and twenty-five days
after twenty-five years of service. An employee may accumulate vacation time earned to a
maximum of two times the amount of his/her annual vacation accrual.
42
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
Full-time employees accrue twelve days of sick leave: annually from the date of employment. An
employee may accumulate sick leave time earned on an unlimited basis. Upon resignation,
separation from service, or retirement from District employment, workers in good standing with
ten or more years of District employment shall receive a cash payment of the equivalent cash
value of accrued sick leave as follows:
Percentage of equiva le nt
cash value of accrued
Years of Employme nt sick leave
15-20 20%
16-20 25%
21 or more 30%
An employee hired before June 30, 2006, who retires from the District shall receive a cash
payment of the percentage of equivalent cash value of accrued sick leave based on years of
employment as described above, and apply the remainder of the equivalent cash value toward
his/her cost of retiree medical plan premiums and/or other qualified medical expenses. Upon
retirement, the amount qualified and designated for retiree medical costs shall be deposited in the
Retiree Health Savings (RHS) plan, set up by the District. The cost for maintaining the retiree's
RHS account and the annual fee for the reimbursement process of qualified medical expenses will
be paid for by the retiree.
An employee hired on or after July 1, 2006, who retires from the District may elect to receive
only a cash payment of the percentage of equivalent cash value of accrued sick leave based on
years of employment as described above.In all cases the equivalent cash value of accrued sick
leave will be based on current rate of pay as of the date of separation from District employment.
The District accrues for all salary-related items in the government-wide statements for which they
are liable to make a payment directly and incrementally associated with payments made for
compensated absences on termination. Compensated absences are liquidated by the fund that has
recorded the related liability. The long-term portion of governmental activities compensated
absences is liquidated primarily by the General Fund.
6.Long-Term/Noncurrent Obligations
In the government-wide financial statements, long-term debt and other long-term obligations are
reported as liabilities in the Statement of Net Position.
7.Debt Discount and Issuance Costs
Debt discounts, premiums, and prepaid issuance costs are capitalized as an offset to long-term
debt and amortized using the straight line method over the life of the related debt. Issuance costs
for the District's tax-exempt commercial paper short-term borrowings are expensed as incurred.
43
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
8.Fund Balance Classifications
In accordance with Government Accounting Standards Board 54,Fund Balance Reporting and
Governmental Fund Type Definitions, the District classifies governmental fund balances as
follows:
Nonspendable fund balance includes amounts that cannot be spent either because it is not in
spendable form or because of legal or contractual constraints.
Restricted fund balance includes amounts that are constrained for specific purposes which are
externally imposed by providers, such as creditors or amounts constrained due to
constitutional provisions or enabling legislation.
Committed fund balances includes amounts that are constrained for specific purposes that are
internally imposed by the government through formal action of the highest level of decision
making authority and does not lapse at period-end. Committed fund balances were imposed
by the District’s Board of Directors resolution. Any changes to committed fund balance
requires the approval of two-thirds of the Board.
Committed fund balances were imposed by the District’s Board of Directors as follows:
o Infrastructure: $17.7 million; projected minimum requirement for expansion of field
and office facilities over the next five years.
o Equipment Replacement: $3 million; projected requirement for equipment and
vehicle replacement based on the amount of accumulated depreciation recorded on
capital assets in service.
o Capital maintenance: $5 million; amounts committed to reserve for future capital
repairs and maintenance.
o Future acquisitions and capital projects: $3 million; amounts committed to reserve for
future capital acquisitions.
o Promissory Note: $0.6 million; amounts committed to payment of promissory note.
Assigned fund balance includes amounts that are intended to be used for specific purposes
that are neither considered restricted or committed. Fund balance may be assigned by the
General Manager,pursuant to Board Policy 3.07, if authorized by the Board of Directors to
make such designations.
Unassigned fund balance includes positive amounts within the general fund which has not
been classified within the above mentioned categories and negative fund balances in other
governmental funds.
The District uses restricted/committed amounts to be spent first when both restricted and
unrestricted fund balance is available unless there are legal documents/contracts that prohibit
doing this, such as a grant agreement requiring dollar for dollar spending. Additionally, the
44
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
District would first use committed, then assigned, and lastly unassigned amounts of unrestricted
fund balance when expenditures are made.
9.Net Position
Net position represents the difference between assets, deferred outflows of resources, liabilities
and deferred inflows of resources. Net investment in capital assets consists of capital assets, net
of accumulated depreciation, reduced by the outstanding balances of any borrowings used for the
acquisition, construction or improvement of those assets. In addition, deferred outflows of
resources and deferred inflows of resources that are attributable to the acquisition, construction,
or improvement of those assets or related debt also are included in the net investment in capital
assets component of net position. Net position is reported as restricted when there are limitations
imposed on its use either through the enabling legislation adopted by the District or through
external restrictions imposed by creditors, grantors, laws or regulations of other governments.
The District applies restricted resources when an expense is incurred for purposes for which both
restricted and unrestricted net position is available.
Unrestricted net position reflect amounts that are not subject to any donor-imposed restrictions.
This class also includes restricted contributions whose donor-imposed restrictions were met
during the fiscal period. A deficit unrestricted net position may result when significant cash
balances restricted for capital projects exist. Once the projects are completed, the restriction on
these assets are released and converted to capital assets.
10.Pension
For purposes of measuring the net pension liability and deferred outflows/inflows of resources
related to pensions, and pension expense, information about the fiduciary net position of the
District’s California Public Employees’ Retirement System (CalPERS) plan and additions
to/deductions from the plan’s 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.
GASB Statement No. 68, Accounting and Financial Reporting for Pensions -an amendment of
GASB Statement No. 27 (GASB Statement No. 68) requires that the reported results pertain to
liability and asset information within certain defined timeframes. For this report, the following
time frames were used:
Valuation Date (VD) ....................................... June 30, 2017
Measurement Date (MD) ................................ June 30, 2018
Measurement Period (MP) .............................. July 1, 2017 to June 30, 2018
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Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
11.Other Postemployment Benefits Oher Than Pensions (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred
inflows of resources, and OPEB expense,information about the fiduciary net position of the
District’s Retiree Benefits Plan (the OPEB Plan)and additions to/deductions are based on the
when they are due and payable in accordance with the benefit terms for the measurement period
included in the OPEB plan’s actuarial reports. Investments are reported at fair value, except for
money market investments and participating interest-earning investment contracts that have a
maturity at the time of purchase of one year or less, which are reported at cost.
Valuation Date June 30, 2017
Measurement Date June 30, 2018
Measurement Period July 1, 2017 to June 30, 2018
12.Property Taxes
The District receives property tax revenue from Santa Clara and San Mateo Counties (the
Counties). The Counties are responsible for assessing, collecting and distributing property taxes
in accordance with state law. Secured property taxes are recorded as revenue when apportioned,
in the fiscal period of the levy. The counties apportion secured property tax revenue in
accordance with the alternate method of distribution prescribed by Section 4705 of the California
Revenue and Taxation Code. This alternate method provides for crediting each applicable fund
with its total secured taxes upon completion of the secured tax roll -approximately October 1 of
each year. Taxes are levied annually on July 1st, and one-half are due by November 1st and one-
half by February 1st. Taxes are delinquent after December 10th and April 10th, respectively.
Supplemental property taxes are levied on a pro-rata basis when changes in assessed valuation
occur due to the completion of construction or sales transactions. Liens on real property are
established on January 15th for the ensuing fiscal period.
On June 30, 1993, the Board of Supervisors adopted the "Teeter" method of property tax
allocation.This method allocates property taxes based on the total property tax billed. At year-
end, the Counties advances cash to each taxing jurisdiction equal to its current year delinquent
taxes. Once the delinquent taxes are collected, the revenue from penalties and interest remains
with each County and is used to pay the interest cost of borrowing the cash used for the advances.
13.Accounting Estimates
The presentation of financial statements in conformity with accounting principles generally
accepted in the United States of America requires management to make estimates and
assumptions that affect the reported amounts reported in the financial statements and
accompanying notes. Actual results may differ from those estimates.
I.Implemented New Accounting Pronouncements
GASB Statement No. 83, Certain Asset Retirement Obligations
This Statement addresses accounting and financial reporting for certain asset retirement obligations
(AROs). An ARO is a legally enforceable liability associated with the retirement of a tangible capital
asset. A government that has legal obligations to perform future asset retirement activities related to
46
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
its tangible capital assets should recognize a liability based on the guidance in this Statement. As of
June 30, 2019, this Statement did not have an impact on the District’s financial statements.
GASB Statement No. 88, Certain Disclosures Related to Debt, Including Direct Borrowings and
Direct Placements
This Statement addresses additional information to be disclosed in the notes to the financial
statements regarding debt, including unused lines of credit; assets pledged as collateral for the debt;
and terms specified in debt agreements related to significant events of default with finance-related
consequences, significant termination events with finance-related consequences, and significant
subjective acceleration clauses. As of June 30, 2019, this Statement did not have an impact on the
District’s financial statements.
J.Upcoming Accounting and Reporting Changes
GASB Statement No. 84, Fiduciary Activities
The objective of this Statement is to improve guidance regarding the identification of fiduciary
activities for accounting and financial reporting purposes and how those activities should be reported.
This Statement establishes criteria for identifying fiduciary activities of all state and local
governments. The focus of the criteria generally is on (1) whether a government is controlling the
assets of the fiduciary activity and (2) the beneficiaries with whom a fiduciary relationship exists.
Separate criteria are included to identify fiduciary component units and postemployment benefit
arrangements that are fiduciary activities. The requirements of this Statement are effective for
financial statements for periods beginning after December 15, 2018. Earlier application is
encouraged. The District doesn’t believe this statement will have a significant impact on the District’s
financial statements.
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 by governments. This statement increases the
usefulness of governments’ financial statements by requiring recognition of certain lease assets and
liabilities for leases that previously were classified as operating leases and recognized as inflows of
resources or outflows of resources based on the payment provisions of the contract. It establishes a
single model for lease accounting based on the foundational principle that leases are financings of the
right to use an underlying asset. Under this statement, a lessee is required to recognize a lease liability
and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a
deferred inflow of resources, thereby enhancing the relevance and consistency of information about
governments’ leasing activities. The requirements of this Statement are effective for financial
statements for periods beginning after December 15, 2019. Earlier application is encouraged. The
District is in the process of determining the impact this Statement will have on the financial
statements.
GASB Statement No. 89, Accounting for Interest Cost Incurred Before the End of the
Construction Period
This Statement addresses interest costs incurred before the end of a construction period be recognized
as an expense in the period in which the cost is incurred for financial statements prepared using the
47
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
economic resources measurement focus. As a result, interest cost incurred before the end of a
construction period will not be included in the historical cost of a capital asset reported in a business-
type activity or enterprise fund. The requirements of this Statement are effective for financial
statements for periods beginning after December 15, 2019. Earlier application is encouraged.The
District doesn’t believe this statement will have a significant impact on the District’s financial
statements.
GASB Statement No. 90, Majority Equity Interests -an Amendment of GASB Statements No. 14
and No. 61
The objectives of this Statement are to improve the consistency and comparability of reporting a
government’s majority equity interest in a legally separate organization and to improve the relevance
of financial statement information for certain component units. This Statement also requires that a
component unit in which a government has 100 percent equity interest account for its assets, deferred
outflows of resources, liabilities, and deferred inflows of resources at acquisition value at the date the
government acquired a 100 percent equity interest in the component unit. The requirements of this
Statement are effective for financial statements for periods beginning after December 15, 2018. The
requirements should be applied retroactively, except for the provisions related to (1) reporting a
majority equity interest in a component unit and (2) reporting a component unit if the government
acquires a 100 percent equity interest. Those provisions should be applied on a prospective basis. The
District doesn’t believe this statement will have a significant impact on the District’s financial
statements.
GASB 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 (1) commitments extended by issuers,
(2) arrangements associated with conduit debt obligations, and (3) related note disclosures. This
Statement also clarifies the existing definition of a conduit debt obligation; establishing that a conduit
debt obligation is not a liability of the issuer; establishing standards for accounting and financial
reporting of additional commitment and voluntary commitments extended by issuers and
arrangements associated with the debt obligations; and improving required note disclosures. The
requirements of this Statement are effective for financial statements for periods beginning after
December 15, 2020. Earlier application is encouraged. The District doesn’t believe this statement will
have a significant impact on the District’s financial statements.
48
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
NOTE 2 -CASH AND INVESTMENTS
Summary of Cash and Investments
The following summarizes deposits as of June 30, 2019:
Cash and
Cash Equivalents
Av aila ble
Cash and Investments for Operations Restricted Total
Cash Deposits:
Cash in Banks 1,573,758$ 33,810$ 1,607,568$
Cash with Fiscal Age nt - 2,531,030 2,531,030
Petty Cash 1,832 - 1,832
Total Cash Deposits 1,575,590 2,564,840 4,140,430
Investments:
Calif ornia Local Age ncy Investment Fund 6,543,761 - 6,543,761
CalTRUST - 1,604,339 1,604,339
Brokerage Ac counts/Cash with Fiscal Age nts 16,313,616 51,761,334 68,074,950
Santa Clara County Pool 22,693,716 5,049,360 27,743,076
Total Investments 45,551,093 58,415,033 103,966,126
Total Cash and Investments 47,126,683$ 60,979,873$ 108,106,556$
Cash in Banks
Cash balances in banks are insured up to $250,000 per insured bank by the Federal Deposit Insurance
Corporation ("FDIC"). The District’s accounts are held with various banks. As of June 30,2019,the
District’s bank balances exceeded FDIC coverage by $1,582,879.
Fair Value Measurements
GASB 72 established a hierarchy of inputs to the valuation techniques above. This hierarchy has three
levels:
Level 1 inputs are quoted prices in active markets for identical assets or liabilities.
Level 2 inputs are quoted market prices for similar assets or liabilities, quoted prices for identical
or similar assets or liabilities in markets that are not active, or other than quoted prices that are
not observable
Level 3 inputs are unobservable inputs, such as a property valuation or an appraisal.
49
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
The District has the following investments with recurring fair value measurements as of June 30, 2019:
12 Months 13 - 24 25 - 60 More Than
Rating Fair Value or Less Months Months 60 Months
Money Market Accounts n/a 3,135,774$ n/a 3,135,774$ -$ -$ -$ 3.02%
Municipal Bonds AAA/A-13,649,234 Level 2 2,835,666 7,038,659 1,847,521 1,927,388 13.13%
Corp/Gov Bonds AAA/A-37,953,286 Level 1 14,603,548 20,936,928 2,412,810 - 36.51%
LAIF n/a 6,543,761 Level 2 6,543,761 - - - 6.29%
CalTrust A+f 1,604,339 Level 2 - - 1,604,339 - 1.54%
Santa Clara County Pool n/a 27,743,076 Level 2 16,384,182 4,096,442 7,262,452 - 26.68%
U.S. Obligations AA+/A-13,336,656 Level 1 10,189,733 3,146,923 - - 12.83%
Total Investments 103,966,126$ 53,692,664$ 35,218,952$ 13,127,122$ 1,927,388$ 100.00%
Input
Level
Concen-
trationsInvestment Type
Maturities
Cash in Santa Clara County Treasury
Santa Clara County is a fiscal agent of the District. The fair value of the District's investment in the
county pool is reported at amounts based on the District's pro-rata share of the fair value provided by the
County Treasurer for the entire portfolio (in relation to the amortized cost of the portfolio). The balance
available for withdrawal is based on the accounting records maintained by the County Treasurer, which is
recorded on the amortized costs basis. Santa Clara County investment pool funds were available for
withdrawal on demand and had an average maturity date of less than one year.
All cash and investments are stated at fair value. Pooled investment earnings are allocated monthly based
on the average cash and investment balances of the various funds of the County.
California Local Agency Investment Fund
The District is a participant in the Local Agency investment Fund (LAIF) that is regulated by California
Government Code Section 16429 under the oversight of the Treasurer of the State of California. The
District reports its investment in LAIF at the fair value amount provided by LAIF, which is the same as
the value of the pool share.The balance is available for withdrawal on demand, and is based on the
accounting records maintained by LAIF, which are recorded on an amortized cost basis. Included in
LAIF's investment portfolio are collateralized mortgage obligations, mortgage-backed securities, other
asset-backed securities, loans to certain state funds, and floating rate securities issued by federal agencies,
government-sponsored enterprises, United States Treasury Notes and Bills, and corporations. At June 30,
2019, these investments had an average maturity date of less than one year.
Investment Trust of California
The District is a participant in the Investment Trust of California (CalTRUST) which is a California joint
powers authority that has been established by its members pursuant to an agreement. The California
Government Code provides that Public Agencies may purchase shares of beneficial interest issues by a
joint powers authority, such as CalTRUST, organized pursuant to the Section 6500 of the Act. The
District reports its investment in CalTRUST at the fair value amount provided by CalTRUST. The
District participates in the Medium-Term Fund with CalTRUST. The balance in this Medium-Term Fund
is available for withdrawal once a week (on Wednesdays), and is based on the net asset value per share on
the Wednesday of each week. Included in CalTRUST's investment portfolio for the Medium-Term Fund
are collateralized mortgage obligations, mortgage-backed securities, other asset-backed securities, loans
to certain state funds, and floating rate securities issued by federal agencies, government-sponsored
enterprises, United States Treasury Notes and Bills, and corporations. At June 30, 2019, these investments
had an average maturity date of 2 to 5 years.
50
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
Investments Authorized by Debt Agreements
The District must maintain required amounts of cash and investments with trustees or fiscal agents under
the terms of certain debt issues. These funds are used if the District fails to meet its obligations under
these debt issues.
Restricted for Debt Service
As of June 30, 2019, the District had $1,726,564 held by Zions bank as trustee, pledged to the payment or
security of its outstanding bond issues. The District also had $5,049,360 held by the County during the
period which was pledged to the payment or security of its outstanding bonds. All transactions associated
with debt service were administered by the Bank or County.
Restricted for Hawthorne Property Maintenance
On November 10,2011, the District received the gift of the 79 acre Hawthorne property, in Portola
Valley, California, and an endowment of $2,018,445 to manage the property in perpetuity. The cash
balance restricted for this purpose at June 30, 2019 was $1,604,339.
Restricted for Measure AA Bond Projects
As of June 30, 2019, the District had $41,130,060 held by Zions bank as trustee, pledged to specific
projects related to the acquisition of property to protect and preserve natural open space lands,
constructions of public access improvements and recreation and capital enhancements to open space lands
to restore disturbed natural areas back to their original condition and function.
Restricted for Staffing Facilities
As of June 30, 2019, the District had $8,904,710 held by Zions bank as trustee, pledged to finance portion
of the cost of acquiring and improving staffing facilities for use by the District.
Restricted for Historic Picchetti Reserve
As of June 30, 2019, the District had $33,810 held with Wells Fargo, pledged for upkeep on the Picchetti
Ranch brick winery building and farm complex.
Restricted Cash with Fiscal Agent
For the year ended June 30, 2019, the District had a balance of $2,531,030 in a Public Agency Retirement
Services (PARS) Pension Rate Stabilization Program (PRSP) 115 irrevocable trust for pensions.
Participating agencies maintain oversight of investment management and control over the risk tolerance
level. Assets in the plan can be accessed to offset unexpected rate increases or be used as a rainy day fund
related to their pension plan (CalPERS). These assets are not dedicated to providing plan benefits to plan
participants and are not directly used to pay benefits until such time as the District transfers the funds
from the PARS trust to the pension plan (CalPERS). The trust restricts the use of the assets to be used
solely for pension related expenses.
51
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
Policies and Practices
The District's Investment Policy and the California Government Code allow the District to invest in the
following, provided the credit ratings of the issuers are acceptable to the District and approved
percentages and maturities are not exceeded. The table below also identifies certain provisions of the
California Government Code or the District's Investment Policy where it is more restrictive:
Au thorized Investment Type
Maxim um
Remaining
Maturity
Maxim um Percentage of
Portfolio
Maxim um
Investment
in one Issuer
Medium Term Notes 5 years 30%No Limit
Money Market and Mutual Funds N/A 20%10%
U.S. Treasury Obliga tions 5 years No Limit No Limit
Federal Age ncy Securities 5 years No Limit No Limit
Banker's Ac ceptance 180 days 40%30%
Commercial P aper 270 days 25%10%
Negotiable Certificates of Deposit 5 years 30%No Limit
Repurchase Agr eements 1 year No Limit No Limit
Reverse Repurchase Agr eements 92 days 20%No Limit
Local Age ncy Investment Fund (LAIF)N/A $40 millio n per account No Limit
a)Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of
an investment. Generally,the longer the maturity of an investment, the greater the sensitivity of its
fair value to the changes in market interest rates.The District manages its exposure to interest rate
risk by investing in the Santa Clara County investment pool and LAIF, which had fair values of
approximately $8.6 billion and $97.6 billion, respectively as of June 30, 2019, and diversifying its
investments, as noted above,through the utilization of brokers.
b)Credit Risk
Credit risk is the risk of loss due to the failure of the security issuer. This is measured by the
assignment of a rating by a nationally recognized statistical rating organization. The investment with
the County’s investment pool is governed by the County’s general investment policy. The County’s
investments in 2019 included U.S. government securities or obligations explicitly guaranteed by the
U.S. government that are not considered to have credit risk exposure. See the schedule above for a
summary of the District’s ratings by investment type.
c)Custodial Credit Risk –Deposits
Custodial credit risk is the risk that in the event of a bank failure, the District’s deposits may not be
returned to it. The District does not have a policy for custodial credit risk for deposits. However,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 public deposits by
52
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
pledging first trust deed mortgage notes having a value of 150 percent of the secured public deposits
and letters of credit issued by the Federal Home Loan Bank of San Francisco having a value of 105
percent of the secured deposits.
d)Concentration of Credit Risk
Concentration of credit risk is the risk of loss attributed to the magnitude of an investor’s holdings in
a single issuer. The District’s investment in the County’s commingled pool is diversified by the
County Treasurer by limiting the percentage of the portfolio that can be invested in any one issuer’s
name.Investments in U.S. Treasuries, U.S.Agency securities explicitly backed by the U.S., and
mutual and pooled funds are not subject to this limitation.
More than 5% of the County’s commingled pooled investments are invested with the Federal
National Mortgage Association, Federal Home Loan Bank, Federal Home Loan Mortgage
Corporation,and Federal Farm Credit Bank.
NOTE 3 -INTERFUND TRANSACTIONS
Interfund Receivables and Payables
Interfund transactions are reported as loans or transfers. The District utilizes interfund transactions to
account for funding received by the General Fund which is then distributed to the other funds for special
uses, such as payment of debt or capital project and to supplement other funding sources. Loans are
reported as interfund receivables and payables, as appropriate, and are subject to elimination upon
consolidation.
The following interfund loans were outstanding at fiscal year end June 30, 2019:
Fu nd
Due from Other
Fu nds
Due to Other
Fu nds
General Fund 4,565,422$ 2,475,316$
Measure AA Capital Projects Fund 2,786,475 4,521,489
GF Capital Projects Fund - 355,092
Total 7,351,897$ 7,351,897$
At June 30, 2019, interfund transfers consisted of the following:
Fu nd Tra nsfer In Tra nsfer Out
General Fund 1,481,755$ 48,447,226$
GF Capital Projects Fund 37,148,401 1,481,755
Debt Service Fund 11,298,825 -
Total 49,928,981$ 49,928,981$
53
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
NOTE 4 -NOTES RECEIVABLE
On December 17, 1997, the District sold the title to and possession of a 50-year fee determinable estate
10-acre parcel near the Skyline Ridge Open Space Preserve. The District financed the purchase in the
amount of $288,800 over 25 years at a rate of 10% per annum. Monthly principal and interest payments
of $2,634 are due on the 1st of each month and late if not paid by the 10th,with the final payment
scheduled December 1, 2022. The outstanding balance at June 30, 2019 was $94,182.
NOTE 5 -CAPITAL ASSETS AND DEPRECIATION
Capital asset activity for the period ended June 30, 2019 is shown below:
Balance Deletions/Balance
Capital Assets June 30, 2018 Ad ditions Ad justments June 30, 2019
No n-depreciable:
Land 414,547,441$ 23,216,204$ -$ 437,763,645$
Construction in P rogress 8,596,297 10,805,611 (3,208,534) 16,193,374
Total Non-Depreciable 423,143,738 34,021,815 (3,208,534) 453,957,019
Depreciable:
Structure and Improvements 16,644,608 11,560,143 - 28,204,751
Infrastructure 32,640,168 2,158,478 - 34,798,646
Equipment 2,333,457 319,326 - 2,652,783
Ve hicles 5,007,778 504,429 (271,417) 5,240,790
Total Depreciable 56,626,011 14,542,376 (271,417) 70,896,970
Less Accumulated Depreciatio n fo r:
Structure and Improvements (9,324,551) (820,470) - (10,145,021)
Infrastructure (4,128,084) (1,128,348) - (5,256,432)
Equipment (1,343,906) (195,263) - (1,539,169)
Ve hicles (2,853,375) (734,147) 233,564 (3,353,958)
Total Accumulated Depreciation (17,649,916) (2,878,228) 233,564 (20,294,580)
Total Depreciable Capital Assets - Net 38,976,095 11,664,148 (37,853) 50,602,390
Total Capital Assets - Net 462,119,833$ 45,685,963$ (3,246,387)$ 504,559,409$
54
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
NOTE 6 -LONG-TERM LIABILITIES
The following is a summary of the changes in long-term liabilities for the period ended June 30, 2019:
Begin ning Ending Due Within
Long-term Liabilitie s Balance Ad ditions Deductions Balance One Year
Promissory Notes (Direct Borrowings):
Current Interest 25,439,999$ -$ 1,200,000$ 24,239,999$ 1,285,000$
Capital Appreciation 6,580,602 - - 6,580,602 -
Accreted in terest 2,445,917 481,593 - 2,927,510 -
Unamortized Premium 5,302,758 - 150,935 5,151,823 -
Subtotal Promissory Notes 39,769,276 481,593 1,350,935 38,899,934 1,285,000
Bonds:
Current Interest 184,370,000 - 5,280,000 179,090,000 7,830,000
Unamortized Bond Premium 21,535,916 - 1,120,340 20,415,576 -
Subtotal Bonds 205,905,916 - 6,400,340 199,505,576 7,830,000
Net P ension Liabilit y 11,022,824 7,773,136 8,383,482 10,412,478 -
Net OP EB Liabilit y 1,845,000 1,192,555 1,175,278 1,862,277 -
Compensated Absences 1,723,930 1,528,342 883,885 2,368,387 883,885
Total Long-term Liabilit ies 260,266,946$ 10,975,626$ 18,193,920$ 253,048,652$ 9,998,885$
Compensated absences,other postemployment benefits and pension liabilities are paid by the fund for
which the employee worked.
Promissory Notes
Hunt Living Trust Promissory Note
On April 1, 2003, the District entered into a $1,500,000 promissory note with the Hunt Living Trust as
part of a lease and management agreement. The note is due in full on April 1, 2023 and bears interest at
5.5% semi-annually through April 1, 2013 and 5.0% per annum until the maturity, or prior redemption, of
the note.
2012 Refunding Promissory Notes
On January 19, 2012, the District advance refunded $34,652,643 in 1999 lease revenue bonds by issuing
$31,264,707 in promissory notes. The 2012 notes bear interest rates ranging from 2.00% to 6.04%. The
notes are a blend of current interest and capital appreciation notes maturing through 2042. The net
proceeds of $33,295,663 (after payment of $278,683 in underwriting fees, insurance, and other issuance
costs and a premium of $2,309,638) were used to purchase U.S government securities. Those securities
were deposited in an irrevocable trust with an escrow agent to provide for all future debt service payments
on the 1999 Series bonds. As a result, the 1999 Series bonds are considered to be defeased and the
liability for those bonds has been removed from the long-term debt in the financial statements. The 2012
Refunding Promissory Notes were partially defeased during fiscal year 2018 with issuance of the 2017
Refunding Bond as noted below.The notes are secured by limited ad valorem property taxes levied upon
all taxable property in the District.
55
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
2015 Refunding Promissory Notes
On January 22, 2015, the District advance refunded $29,986,962 in 2004 Revenue Bonds by issuing
$28,578,500 in promissory notes. The 2015 notes bear interest rates ranging from 2.00% to 5.00%.The
notes are current interest notes maturing through 2035.The net proceeds of $28,325,491 (after payment of
$253,009 in underwriting fees, insurance, and other issuance costs and a premium of $4,948,500) were
used to purchase U.S government securities. Those securities were deposited in an irrevocable trust with
an escrow agent to provide for all future debt service payments on the 2004 Revenue Bonds. As a result,
the 2004 Revenue Bonds are considered to be defeased and the liability for those bonds has been removed
from the long-term debt in the financial statements. The notes are secured by limited ad valorem property
taxes levied upon all taxable property in the District.
Revenue and General Obligation Bonds
2011 Revenue Bonds
On May 19, 2011, the Authority, on behalf of the District, issued $20,500,000 of 2011 Revenue Bonds for
the purpose of acquiring land to preserve and use as open space and pay bond issue and related costs. The
Bonds are not general obligations. Each period, the District will appropriate revenues-mainly limited
properly tax collections that Santa Clara County and San Mateo County allocate to the District –to pay its
obligations under a Lease Agreement for use and occupancy of District land in addition to other District
debt and lease obligations unrelated to this financing. The Current Interest Bonds bear interest at 2.0% to
6.0% and are due semi-annually on March 1 and September 1. Principal payments on the Current Interest
Bonds are due annually September 1. This Bond was partially defeased during fiscal year 2017 with
issuance of the 2016 Refunding Series A and B Green Bonds as noted below. There is no remedy to the
District for default beyond the security provided in the indenture and debt reserves established.
2015A and 2015B General Obligation Bonds
On July 29, 2015, the District issued $40,000,000 of 2015A general obligation bonds and $5,000,000 of
2015B federally taxable general obligation bonds to finance certain projects authorized by voters. The
bonds bear interest from 1.5% to 5% and are due semi-annually on March 1 and September 1. The bonds
were issued at a premium of $2,559,224 with an underwriter’s discount of $107,599 and issuance costs of
$170,000.The bonds are secured by ad valorem property taxes levied by the District. There is no remedy
to the District for default beyond the security provided in the indenture and debt reserves established.
2016A and 2016B Refunding Green Bonds
On September 8, 2016 the District issued $54,490,000 of 2016 Refunding Series A and $2,920,000 of
2016 Refunding Series B Green Bonds for the purpose of refunding its outstanding obligations under the
2007 Series A Revenue Refunding Bonds and prepay a portion of its obligations under the 2011 Lease
Revenue Bonds. As a result,the 2007 Series A Revenue Refunding Bonds and the 2011 Lease Revenue
Bonds are considered to be defeased and the liability for those bonds has been removed from the
government-wide financial statement of net position.
The refunding resulted in a difference between the reacquisition price and the net carrying amount of the
old debt of $5,032,161, which is reported as a deferred outflow on the government-wide statement of net
position. This difference, reported in the accompanying financial statements as a deduction from bonds
payable, is being charged to operations through fiscal year 2036 using the straight-line method. The
District completed the refunding to obtain an economic gain (difference between the present value of the
old and the new debt service payments) of $12,694,440.
56
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
The 2016 Refunding Green Bonds Series A bears interest from 2.0% to 5.0% and the Series B bears
interest of 0.73%. Interest for both Series A and B are due semi-annually on March 1 and September 1.
Principal payments for Series A begins September 2017 and are due annually thereafter until September
2036. Series B has only one principal payment in September 2017. The bonds are secured by the
District’s share of the general 1% ad valorem property tax levied in the District.There is no remedy to the
District for default beyond the security provided in the indenture and debt reserves established.
2017 Series A Refunding Green Bonds
On December 13, 2017 the District issued $25,025,000 of 2017 Refunding Green Bonds for the purpose
of partially refunding its outstanding obligations under the 2012 Refunding Promissory Notes. The
proceeds of the 2017 Refunding Green Bonds, together with $676,232 of other District funds, were used
to defease and redeem $11,605,000 principal amount of the District’s outstanding 2012 Current Interest
Notes and $8,894,106 initial principal of the District’s outstanding 2012 Capital Appreciation Notes,
collectively,the 2012 Refunding Promissory Notes. The amounts defeased have been removed from the
government-wide financial statement of net position.
The refunding resulted in a difference between the reacquisition price and the net carrying amount of the
old debt of $4,113,597, which is reported as a deferred outflow on the government-wide statement of net
position.This difference, reported in the accompanying financial statements as a deduction from bonds
payable, is being charged to operations through fiscal year 2033 using the straight-line method. The
District completed the refunding to obtain an economic gain (difference between the present value of the
old and the new debt service payments)of $8,882,524.
The 2017 Refunding Green Bonds bears interest from 3.125% to 5.0%. Interest is due semi-annually on
March 1 and September 1. Principal payments begin September 2025 and are due annually thereafter until
September 2037. The bonds are secured by the District’s share of the general 1% ad valorem property tax
levied in the District.There is no remedy to the District for default beyond the security provided in the
indenture and debt reserves established.
2017 Series B Parity Bonds
On December 13, 2017, the District issued $11,220,000 of 2017 parity bonds to finance portion of the
cost of acquiring and improving staffing facilities for use by the District. The bonds bear interest of 5%
and are due semi-annually on June 30 and December 30.The bonds were issued at a premium of
$1,413,434 and issuance costs of $133,434.The bonds are secured by the District’s share of the general
1% ad valorem property tax levied in the District.There is no remedy to the District for default beyond
the security provided in the indenture and debt reserves established.
2018 General Obligation Bonds
On February 1, 2018, the District issued $50,000,000 of 2018 general obligation bonds to finance 25
projects specified in Measure AA.The bonds bear interest from 2% to 5% and are due semi-annually on
March 1 and September 1. The bonds were issued at a premium of $3,691,291 with an issuance costs of
$455,462.The bonds are secured by the District’s share of the general 1% ad valorem property tax levied
in the District.There is no remedy to the District for default beyond the security provided in the indenture
and debt reserves established.
57
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
The following schedule summarizes the District’s outstanding promissory notes and bonds as of June 30,
2019:
Origin al Begin ning Ending
Long Term Debt Issue Balance Additions Retirements Balance
Promisso ry Notes (Direct Bo rro wi ngs):
Hunt Note 1,500,000$ 1,500,000$ -$ -$ 1,500,000$
2012 Refunding Note Current Int.15,790,000 2,124,999 - 395,000 1,729,999
2012 Refunding Note Cap Apprec.15,474,708 6,580,602 - - 6,580,602
2015 Refunding Note 23,630,000 21,815,000 - 805,000 21,010,000
Subtotal Promisso ry Notes 56,394,708 32,020,601 - 1,200,000 30,820,601
Bo nds:
2011 Lease Revenue 20,500,000 930,000 - 180,000 750,000
2015A General Obliga tion Bonds 40,000,000 40,000,000 - - 40,000,000
2015B General Obliga tion Bonds 5,000,000 3,350,000 - 890,000 2,460,000
2016 Refunding Bond 57,410,000 53,845,000 - 3,410,000 50,435,000
2017 Refunding Bond 25,025,000 25,025,000 - - 25,025,000
2017 Parity Bond 11,220,000 11,220,000 - 800,000 10,420,000
2018 General Obliga tion Bonds 50,000,000 50,000,000 - - 50,000,000
Subtotal Bo nds 209,155,000 184,370,000 - 5,280,000 179,090,000
Accreted Interest:
2012 Refunding Note 2,445,917 481,593 - 2,927,510
Subtotal Accreted Interest 2,445,917 481,593 - 2,927,510
Unamo rtized Bond Premium 26,838,674 - 1,271,275 25,567,399
Total Long Term Debt 265,549,708$ 245,675,192$ 481,593$ 7,751,275$ 238,405,510$
The promissory notes future debt service requirements as of June 30,2019 were as follows:
Year Ending June 30,Prin cipal
Remaining
Ac cretion Interest Total
2020 1,285,000$ -$ 1,136,775$ 2,421,775$
2021 1,370,000 - 1,084,025 2,454,025
2022 1,445,000 - 1,029,625 2,474,625
2023 3,040,000 - 963,950 4,003,950
2024 1,170,000 - 825,750 1,995,750
2025-2029 6,825,000 - 3,163,875 9,988,875
2030-2034 12,946,057 6,728,490 1,309,000 20,983,547
2035-2039 2,739,544 2,298,400 35,125 5,073,069
Total Debt Service 30,820,601$ 9,026,890$ 9,548,125$ 49,395,616$
58
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
The bonds future debt service requirements as of June 30, 2019 were as follows:
Year Ending June 30,Prin cipal
Remaining
Ac cretion Interest Total
2020 7,830,000$ -$ 7,417,788$ 15,247,788$
2021 7,025,000 - 7,161,901 14,186,901
2022 6,675,000 - 6,895,263 13,570,263
2023 6,990,000 - 6,589,537 13,579,537
2024 7,375,000 - 6,239,763 13,614,763
2025-2029 40,435,000 - 25,216,740 65,651,740
2030-2034 23,170,000 - 17,528,670 40,698,670
2035-2039 41,710,000 - 11,255,601 52,965,601
2040-2044 20,745,000 - 5,566,500 26,311,500
2045-2049 17,135,000 - 1,459,100 18,594,100
Total Debt Service 179,090,000$-$ 95,330,863$ 274,420,863$
Amortization of the deferred loss on early retirement of long-term debt for the fiscal period ended June
30, 2019 was as follows:
Begin ning Balance 10,240,823$
Am ortization (845,123)
Ending Balance 9,395,700$
NOTE 7 - RENTAL INCOME
The District rents certain land and structures to other entities under operating leases with terms generally
on a month-to-month basis. Rental income of $1,988,147 was received during the period ended June 30,
2019.
NOTE 8 -CALPERS PENSION PLAN
Pension Plan
General Information about the Pension Plans
Plan Description -The District provides benefits to eligible employees through cost-sharing multiple
employer defined benefit pension plans (the Plan(s)) administered by the California Public Employees’
Retirement System (CalPERS). Members of the Plan include all permanent employees working full-time.
Benefit provisions under the Plans are established by State statute and District resolution. CalPERS
issues publicly available reports that include a full description of the pension plans regarding benefit
provisions, assumptions and membership information that can be found on the CalPERS website.
Benefits Provided -CalPERS provides service retirement and disability benefits, annual cost of living
adjustments and death benefits to plan members, who must be public employees and beneficiaries.
Benefits are based on years of credited service, equal to one year of full-time employment. Members
with five years of total service are eligible to retire at age 55 with statutorily reduced benefits. All
members are eligible for non-industrial disability benefits after 10 years of service. The death benefit is
59
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
the Optional Settlement 2W Death Benefit. The cost of living adjustments for the Plan are applied as
specified by the Public Employees’ Retirement Law.
The Plans’ provisions and benefits in effect at June 30, 2019, are summarized as follows:
Ti er 1 PEPRA
Bene fit formul a 2.5% @ 5 5 2% @ 6 2
Be ne fit ve sting s chedul e 5 Ye ar s 5 Ye ar s
Be ne fit payme nt s Mo nthl y f or Li fe Monthly for Life
Re tirement age 55 62
Mo nthl y be ne fits as a % o f eligible compens at ion 2.0% to 2.5% 2.00%
Re qui red e mpl oyee contribut ion rat es 8.000% 6.250%
Re qui red e mpl oyer contribution rat es 10.609% 6.842%
Mi scel lane ous
Employees Covered –At June 30, 2019, the following employees were covered by the benefit terms for
the Plan:
Miscellane ous
Ac tive 141
Tr ans ferred 50
Se par at ed 67
Re tired 70
To tal 328
Contributions -Section 20814(c) of the California Public Employees’ Retirement Law requires that the
employer contribution rates for all public employers be determined on an annual basis by the actuary and
shall be effective on the July 1 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. The actuarially
determined rate is the estimated amount necessary to finance the costs of benefits earned by employees
during the year, with an additional amount to finance any unfunded accrued liability. The District is
required to contribute the difference between the actuarially determined rate and the contribution rate of
employees.
Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
As of June 30, 2019, the District reported net pension liabilities for its proportionate shares of the net
pension liability as follows:
Miscella neous
Proportio nate Share of
Net Pensio n
Liability/(Asset)
$ 10,412,478
The District’s net pension liability for the Plan is measured as the proportionate share of the net pension
liability. The net pension liability of the Plan is measured as of June 30, 2018,and the total pension
liability for the Plan used to calculate the net pension liability was determined by an actuarial valuation
as of June 30, 2017 using standard procedures. The District’s proportion of the net pension liability was
60
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
based on a projection of the District’s long-term share of contributions in to the pension plan relative to
the projected contributions of all participating employers,as actuarially determined. The District’s
proportionate share of the net pension liability for the Plan as of fiscal years June 30, 2018 and 2019 was
as follows:
Miscellaneo us
Proportion - June 30, 2018 0.27962%
Proportion - June 30, 2019 0.27629%
Change - Increase/(Decrease)-0.00333%
For the fiscal year ended June 30, 2019,the District recognized pension expense of $2,685,156. At fiscal
year June 30, 2019, the District reported deferred outflows of resources and deferred inflows of resources
related to pensions from the following sources:
Deferre d
Outflo ws of
Reso urces
Deferre d
Inflo ws of
Reso urces
Changes of As sumptions 1,187,053$ 290,924$
Differences between Expected and Ac tual Exp erience 399,508 135,950
Differences between Projected and Ac tual Investment Earnings 51,477 -
Differences between Employer's Contributions and Proportionate
Share of Contributions 899,679 262,985
Change in Employer's Proportion 864,101 689,495
Pension Contributions Made Subsequent to Measurement Date 1,358,206 -
To tal 4,760,025$ 1,379,355$
The District reported $1,358,206 as deferred outflows of resources related to contributions subsequent to
the measurement date that will be recognized as a reduction of the net pension liability in the year ended
June 30,2020.
Other amounts reported as deferred outflows of resources and deferred inflows of resources related to
pensions will be recognized as pension expense as follows:
1,373,936$
881,007
(138,824)
(93,654)
2,022,465$
2020
To tal
2021
2022
2023
Deferre d
Outflo ws /
(Inflo ws ) of
Reso urces
Fi scal Ye ar
En ding June 30:
61
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
Actuarial Assumptions -The total pension liabilities in the June 30, 2017 actuarial valuations were
determined using the following actuarial assumptions:
Va luat ion Date June 30, 2017
Me as ur ement Dat e June 3 0, 2 018
Ac tuar ial Co st Me thod Ent ry-Age No rmal
Co st Method
Ac tuar ial As sumptions:
Discount Rate 7.15%
Inf lation 2.50%
Payr oll Gr owth 2.75%
Projected Sal ar y Inc rease (1)
Investment Rate of Return 7.15% (2)
Mo rtality (3)
(1) Var ies by age and s ervice
(2) Net of pens ion plan investment expens es, inc ludi ng inf lation
(3) Derived us ing Cal PERS' me mbe rship dat a for al l funds
Discount Rate -The discount rate used to measure the total pension liability was 7.15 percent for each
Plan.To determine whether the municipal bond rate should be used in the calculation of a discount rate
for each plan, CalPERS stress tested plans that would most likely result in a discount rate that would be
different from the actuarially assumed discount rate. Based on the testing, none of the tested plans run out
of assets. Therefore, the current 7.15 percent discount rate is adequate and the use of the municipal bond
rate calculation is not necessary. The long term expected discount rate of 7.15 percent will be applied to
all plans in the Public Employees Retirement Fund (PERF). The stress test results are presented in a
detailed report that can be obtained from the CalPERS’ website.
The long-term expected rate of return on pension plan investments was determined using a building-
block method in which expected future real rates of return (expected returns, net of pension plan
investment expense and inflation) are developed for each major asset class.
In determining the long-term expected rate of return, CalPERS took into account both short-term and
long-term market return expectations as well as the expected pension fund cash flows.Using historical
returns of all the funds’ asset classes,expected compound returns were calculated over the short-term
(first 10 years) and the long-term (11-60 years) using a building-block approach. Using the expected
nominal returns for both short-term and long-term, the present value of benefits was calculated for each
fund. The expected rate of return was set by calculating the rounded single equivalent expected return
that arrived at the same present value of benefits for cash flows as the one calculated using both short-
term and long-term returns. The expected rate of return was then set equivalent to the single equivalent
rate calculated above and adjusted to account for assumed administrative expenses.
62
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
The table below reflects the long-term expected real rate of return by asset class. The rate of return was
calculated using the capital market assumptions applied to determine the discount rate and asset
allocation.
As sumed
As set Real Return Real Return
As set Class (a)Allo cation Years 1 - 10 (b)Years 11+ (c)
Global Equity 50.00%4.80% 5.98%
Fixe d Income 28.00%1.00% 2.62%
Inflation Sensitive 0.00%0.77% 1.81%
Priv ate Equity 8.00%6.30% 7.23%
Real Estate 13.00%3.75% 4.93%
Liquidity 1.00%0.00%-0.92%
Total 100.00%
(a) In the System's CAFR, Fixe d Income is included in Glo bal Debt Securities; Liquidity
Liq uidity is included in Short-term Investments; Inflation As sets are in cluded in both
Glo bal Equity Securities and Global Debt Securities.
(b) An expected in flation of 2.0% used for this period.
(c) An expected in flation of 2.92% used for this period.
Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate
-The following presents the District’s proportionate share of the net pension liability for the Plan,
calculated using the discount rate for the Plan, as well as what the District’s proportionate share of the net
pension liability would be if it were calculated using a discount rate that is 1-percentage point lower or 1-
percentage point higher than the current rate:
Miscellaneo us
1% Decrease 6.15%
Net Pension Liabilit y 19,423,155$
Current 7.15%
Net Pension Liabilit y 10,412,478$
1% Increase 8.15%
Net Pension Liabilit y 2,974,312$
Pension Plan Fiduciary Net Position -Detailed information about each pension plan’s fiduciary net
position is available in the separately issued CalPERS financial reports.
63
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
NOTE 9 -POSTEMPLOYMENT BENEFITS OTHER THAN PENSION BENEFITS
Plan Description -The District joined the California Employers' Retiree Benefit Trust (CERBT),an
agent multiple-employer defined benefit postemployment healthcare plan administered by CalPERS. See
eligibility requirements below. Retiree benefit continues to surviving spouse if retiree elects survivor
annuity under CalPERS retirement plan. The OPEB plan’s audited financial statements are available at
https://www.calpers.ca.gov/docs/forms-publications/gasb-75-schedule-changes-fiduciary-net-position-
2017.pdf.
Benefits Provided -The following is a summary of the plan benefits provided:
El igibility:Retire directly from the District under CalPER (age 50 and 5
years of service)
Continue participation in PEMHCA
Retiree Medical Benefit:District pays retiree medical premiums up to:
- $300/month effective 1/1/07
- $350/month effective 1/1/09
Must be at le ast equal to statutory PEMHCA minim um
($122 in 2015, $125 in 2016)
PEMHCA Administrative Fe e:District pays CalPERS administrative fees (0.32% of
premiums for 2015/16)
Surviving Spo use Co ntinuatio n:Retiree beneift continues to surviving spouse if retiree elects
survivor annuity under CalPERS retirement plan
Minimum Age:Retirement under CalPERS
Employees Covered by Benefit Terms -At June 30, 2017 (the valuation date), the benefit terms
covered the following employees:
Ac tive employees 138
Inactive employees 31
To tal emplo yees 169
Contributions -The District makes contributions based on an actuarially determined rate and are
approved by the authority of the District’s Board. Total contributions during the year were $617,768.
Total contributions included in the measurement period were $412,000. The actuarially determined
contribution for the measurement period was $624,000. The District’s contributions were 4.95%of
covered payroll during the measurement period June 30, 2018 (reporting period June 30, 2019).
Employees are not required to contribute to the plan.
64
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
Actuarial Assumptions -The following summarized the actuarial assumptions for the OPEB plan
included in this fiscal year:
Valuatio n Date:June 30, 2017
Measurement Date:June 30, 2018
Actuarial Co st Metho d:Entry age normal, level precentage of payroll
Amo rt izatio n Perio d:10.2 years
Asset Valuatio n Metho d:Investment ga in s and lo ses spread over 5 year rollin g period
Actuarial Assumptio ns:
Disco unt Rate 6.75%
General Inflation 2.75%
Payroll Increases Aggr egate - 3%
Merit - CalPERS 1997-2015 experience study
Medical Tre nd Non-medicare - 7.5% for 2019, decreasing to an ultimate
rate of 4.0% in 2076 and la ter years
Medicare - 6.5% for 2019, decreasing to an ultimate rate
of 4.0% in 2076 and la ter years
PEMHCA Minimum Increases 4.25%
Mo rt ality, Retirement,
Disability, Terminatio n CalPERS 1997-2015 experience study
Mo rt ality Improvement Post-retirement mortalit y projected fully generational wit h
Society of Ac tuaries Scale MP -2017
Healthcare Participatio n fo r
Future Retirees
Currently covered: 90%
Currently waived: 60%
Discount Rate -The projection of cash flows used to determine the discount rate assumed that the
District contribution will be made at rates equal to the actuarially determined contribution rates.Based on
those assumptions, the OPEB plan's fiduciary net position was projected to cover all future OPEB
payments. Therefore, the discount rate was set to be equal to the long-term expected rate of return which
was applied to all periods of projected benefit payments to determine the total OPEB liability.
Long-Term Expected Rate of Return -The long-term expected rate of return on OPEB plan
investments was determined using a building-block method in which 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.
65
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
The target allocation and best estimates of arithmetic real rates of return for each major asset class are
summarized in the following table:
Asset Class
Percentage of
Po rt fo lio
Lo ng-Term
Ex pected Rate of
Return
Global Equity 57.00%4.820%
Fixe d Income 27.00%1.470%
TIPS 5.00%1.290%
Commodities 3.00%0.840%
REIT s 8.00%3.760%
To tal 100.00%
Net OPEB Liability -The District's net OPEB liability was measured as of June 30, 2018 (measurement
date), and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial
valuation as of June 30, 2017 (valuation date) for the fiscal year ended June 30, 2019 (reporting date).
The following summarizes the changes in the net OPEB liability during the year ended June 30, 2019, for
the measurement date of June 30, 2018:
Fi scal Ye ar Ended June 30, 2019
(Measurement Date June 30, 2017)
To tal OPEB
Liability
Plan Fi duciary
Net Po sitio n
Net OPEB
Liability (Asset)
Balance at June 30,2018 5,111,000$ 3,266,000$ 1,845,000$
Service cost 321,153 - 321,153
Interest in Total OPEB Liabilit y 361,203 - 361,203
Employer contributions - 412,000 (412,000)
Ac tual investment in come - 259,143 (259,143)
Ad ministrative expenses - (6,064) 6,064
Benefit payments (162,000) (162,000) -
Net changes 520,356 503,079 17,277
Balance at June 30, 2019 5,631,356$ 3,769,079$ 1,862,277$
Covered Employee Payroll 13,550,000$
Total OPEB Liabilit y as a % of Covered Employee Payroll 41.56%
Plan Fid. Net Position as a % of Total OPEB Liabilit y 66.93%
Service Cost as a % of Covered Employee Payroll 2.37%
Net OP EB Liabilit y as a % of Covered Employee Payroll 13.74%
66
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
Deferred Inflows and Outflows of Resources -At June 30, 2019, the District reported deferred
outflows of resources and deferred inflows of resources related to OPEB from the following sources:
Deferre d Outflo ws
of Reso urces
Deferre d Inflo ws
of Reso urces
Difference between actual and expected experience -$ -$
Difference between actual and expected earnings - 92,510
Change in assumptions - -
OP EB contribution subsequent to measurement date 670,768 -
To tals 670,768$ 92,510$
Of the total amount reported as deferred outflows of resources related to OPEB, $670,768 resulting from
District contributions subsequent to the measurement date and before the end of the fiscal year will be
included as a reduction of the net OPEB liability in the year ended June 30, 2020. Other amounts reported
as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in
OPEB expense as follows:
Year Ended June 30,
2020 (28,277)$
2021 (28,277)
2022 (28,277)
2023 (7,679)
2024 -
Thereafter -
To tal (92,510)$
OPEB Expense -The following summarizes the OPEB expense by source during the year ended June
30, 2019, for the measurement date of June 30, 2018:
Service cost 321,153$
Interest in TOL 361,203
Expected in vestment in come (220,756)
Difference between actual and expected earnings (28,277)
Ad ministrative expenses 6,064
OPEB Ex pense 439,387$
The following summarizes changes in the net OPEB liability as reconciled to OPEB expense during the
year ended June 30, 2019, for the measurement date of June 30,2018:
1,862,277$
(1,845,000)
17,277
Changes in deferred outflows 10,110
Employer contributions and im plic t subsidy 412,000
OPEB Ex pense 439,387$
Net OP EB lia bilit y ending
Net OP EB lia bilit y beginin g
Change in net OP EB lia bilit y
67
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
Sensitivity to Changes in the Discount Rate -The net OPEB liability of the District, as well as what the
District's net OPEB liability would be if it were calculated using a discount rate that is one percentage
point lower or one percentage point higher, is as follows:
(1% Decrease )6.75%(1% Increase )
Net OP EB Liabilit y (Asset)2,705,950$ 1,862,277$ 1,170,860$
Disco unt Rate
Sensitivity to Changes in the Healthcare Cost Trend Rates -The net OPEB liability of the District, as
well as what the District'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, is as follows:
(1% Decrease )4.25%(1% Increase )
Net OP EB Liabilit y (Asset)1,632,015$ 1,862,277$ 2,171,385$
Tre nd Rate
NOTE 10 -JOINT VENTURES (JOINT POWERS AGREEMENTS)
The District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of
assets; injuries to employees; and natural disasters. Prior to July 1, 2002, the District managed and
financed these risks by purchasing commercial insurance. On July 1, 2002, the District joined the
California Joint Powers Insurance Authority (CAL JPIA). CAL JPIA is composed of 119 California
public entities and is organized under a joint powers agreement pursuant to California Government Code
Section 6500 et seq.The purpose of CAL JPIA is to arrange and administer programs for the pooling of
self-insurance losses, to purchase excess insurance or reinsurance, and to arrange for group-purchased
insurance for property and other coverages. CAL JPIA's pool began covering claims of its members in
1978. Each member government has an elected official as its representative on the Board of Directors.
The Board operates through a nine member Executive Committee.
During the past three fiscal periods, none of the programs of protection have had settlements or judgments
that exceeded pooled or insured coverage. There have been no significant reductions in pooled or insured
liability coverage from coverage in the prior period.
Self-Insurance Programs of the CAL JPIA
General and Automobile Liability
Each government member pays a primary deposit to cover estimated losses for a fiscal year (claims year).
General liability (GL) coverage includes bodily injury, personal injury, or property damage to a third
party resulting from a member activity.The GL program also provides automobile liability coverage.Six
months after the close of a fiscal period, outstanding claims are valued.A retrospective deposit
computation is then made for each open claims year. Costs are spread to members as follows: the first
$30,000 to $750,000 are pooled based on member's share of costs under $30,000; costs in excess of
$750,000 are shared by the members based upon each individual member's payroll. Costs of covered
claims above $5,000,000 are currently paid by reinsurance. The protection for each member is
$50,000,000 per occurrence, up to $50,000,000.
68
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
Worker's Compensation
The District also participates in the Worker's Compensation program administered by CAL JPIA. Pool
deposits and retrospective adjustments are valued in a manner similar to the General Liability pool. The
District is charged for the first $50,000 of each claim.Costs from $50,000 to $100,000 per claim are
pooled based on the member's losses under its retention level. Costs between $100,000 and $2,000,000
per claim are pooled based on payroll. Costs from $2,000,000 to $5,000,000 are paid by excess insurance
purchased by CAL JPIA. The excess insurance provides coverage to statutory limits.
Purchased Insurance
Environmental Insurance
The District participates in the Pollution and Remediation Legal Liability Program, which is available
through CAL JPIA. The policy provides coverage for both first and third party damages, including certain
types of cleanups;fuel spill or hazmat incidents; member listed non-owned disposal sites; above ground
and underground storage tanks; and for sudden and gradual pollution at or from property, streets, sanitary
sewer trunk lines and storm drain outfalls owned by the District. Coverage is on a claims-made basis.
There is a $50,000 deductible. CAL JPIA has a limit of $50,000,000 for the three-year coverage period.
The current coverage period is July 2017 through July 1, 2020. Each member of CAL JPIA has a
$10,000,000 aggregate limit during the three-year period. The current coverage period is July 2017
through July 1, 2020.
Property Insurance
The District participates in the All-Risk property program of CAL JPIA which includes all-risk coverage
for real and personal property (such as scheduled buildings, office furniture, equipment, vehicles, etc).
This insurance is underwritten by several insurance companies. Property is currently insured according to
a schedule of covered property submitted by the District to CAL JPIA.The All-Risk deductible is $5,000
per occurrence; $1,000 for non-emergency vehicles. Premiums for the coverage are paid annually and are
not subject to retroactive adjustments.
Boiler & Machinery Insurance
The District participates in the optional coverage for boiler and machinery, which is purchased separately
under the property program. Coverage is for physical damage for sudden and accidental breakdown of
boilers and machinery, and electrical injury. There is a $5,000 per accident or occurrence deductible.
Crime Insurance
The District participates in the crime program of CAL JPIA in the amount of $1,000,000 per claim, with a
$2,500 per occurrence deductible.Insurance provides coverage for employee dishonesty,failure to
faithfully perform duties, forgery, counterfeiting, theft, robbery, burglary, and computer fraud. Premiums
are paid annually and are not subject to retroactive adjustments.
Special Event Tenant User Liability Insurance
The District participates in the special events program of CAL JPIA which provides liability insurance
when District premises are used for special events. The insurance premium is paid by the tenant user to
69
Midpeninsula Regional Open Space District
Notes to the Basic Financial Statements
June 30, 2019
the District according to a schedule. The District then pays the insurance arranged through CAL JPIA.
There is no deductible and the District is added as additional insured.Liability limits are purchased in $1
million per occurrence increments.
Vendors/Contractors Program
General liability coverage with or without professional liability is offered through CAL JPIA to
vendors/contractors who otherwise could not meet the District’s minimum insurance requirement: $1
million per occurrence, $2 million in aggregate.
Cyber Liability Program
The cyber liability program is partially covered under the liability program, and partially held through a
stand-alone coverage program. Cyber liability provides coverage for both first-and third-party claims.
First party coverage includes privacy, regulatory claims, security breach response, business income loss,
dependent business income loss, digital asset restoration costs, and cyber-extortion threats, while third-
party coverage includes privacy liability, network security liability,and multimedia liability. Members
work directly with the reinsurer to investigate and respond to claims. There is a $1 million per occurrence
limit of coverage,$1 million aggregate limit per policy period per member, and a $10 million aggregate
limit of coverage for all members per policy period.
NOTE 11 -COMMITMENTS AND CONTINGENCIES
Litigation
The District may be exposed to various claims and litigation during the normal course of business.
However, management believes there were no matters that would have a material adverse effect on the
District’s financial position or results of operations as of June 30, 2019.
Commitments
As of June 30, 2019, the District had remaining commitments of $4,522,563 towards construction and
other contracts. These commitments are not liabilities of the District’s until services or goods have been
rendered/received. The expected date of completion is between December 2021 and June 2028.
70
Required Supplementary Information
71
Page Intentionally Left Blank
72
REQUIRED SUPPLEMENTARY INFORMATION
BUDGETARY SCHEDULES
This schedule presents a comparison of the original budget,final budget and actual revenues and expenditures
for General Fund. The schedule presents the difference between the final budget and actuals.
PENSION SCHEDULES
These schedules present information that shows the District's proportionate share of the pension liability in the
cost sharing pools,actuarial information,and contributions.The proportionate share information is useful in
determining the District's liability on relation to all other entities in the pool.
POSTEMPLOYMENT BENEFIT SCHEDULES
These schedules present information that shows the District's total other postemployment benefits (OPEB),plan
fiduciary net position, and contributions related to retiree healthcare benefits provided by the District.
73
Variance with
Final Budget
Actual Positive -
Original Final (GAAP Basis)(Negative)
Revenues:
Property taxes 48,122,000$ 48,919,000$ 49,156,904$ 237,904$
Grant income 191,000 191,000 460,842 269,842
Property management 1,221,124 1,043,000 2,360,364 1,317,364
Investment earnings 1,079,000 1,949,904 1,403,878 (546,026)
Other revenues 471,738 1,158,498 640,850 (517,648)
Total revenues 51,084,862 53,261,402 54,022,838 761,436
Expenditures:
Current
Salaries and employee benefits 22,930,309 23,155,369 20,727,559 2,427,810
Services and supplies 10,648,125 10,384,065 8,086,707 2,297,358
Capital outlay 83,000 - - -
Total expenditures 33,661,434 33,539,434 28,814,266 4,725,168
Excess (deficiency) of revenues
over (under) expenditures 17,423,428 19,721,968 25,208,572 5,486,604
Other financing sources (uses):
Transfers in - - 1,481,755 1,481,755
Transfers out (14,529,135) (14,529,135) (48,447,226) (33,918,091)
Total other financing sources (uses)(14,529,135) (14,529,135) (46,965,471) (32,436,336)
Net change in fund balance 2,894,293 5,192,833 (21,756,899) (26,949,732)
Fund balance beginning 73,109,487 73,109,487 73,109,487 -
Fund balance ending 76,003,780$ 78,302,320$ 51,352,588$ (26,949,732)$
The District employs budget control by object codes and by individual appropriation accounts.Budgets are prepared on the
modified accrual basis of accounting in accordance with accounting principles generally accepted in the Un ited States of
America as prescribed by the Governmental Accounting Standards Board.The budgets are revised during the year by the
Board of Directors to provide for revised priorities.Expenditures cannot legally exceed appropriations by major object code.
The originally adopted and final revised budgets for the General Fund are presented as Required Supplementary Information.
The basis of budgeting is the same as GAAP.Transfers out exceeded budget as noted above because of the transfer to GF
Capital Projects Fund for the District's new building purchase.
Budgeted Amounts
Midpeninsula Regional Open Space District
Budget to Actual (GAAP)
For the Fiscal Year Ended June 30, 2019
Schedule of Revenues, Expenditures and Changes in Fund Balance
General Fund
74
Miscellaneous Plan
Plan Measurement Date 2014 2015 2016 2017 2018
Fiscal Year Ended 2015 2016 2017 2018 2019
Contractually Required Contributions 1,461,069$ 1,358,520$ 1,514,352$ 1,763,650$ 1,358,184$
Contributions in Relation to Contractually
Required Contributions 1,343,244 4,788,977 2,529,862 1,783,789 1,358,206
Contribution Deficiency (Excess)117,825$ (3,430,457)$(1,015,510)$ (20,139)$ (22)$
Covered Payroll 8,994,979$ 9,862,578$ 11,834,150$ 12,802,887$ 15,311,826$
Contributions as a % of Covered Payroll 14.93%48.56%21.38%13.93%8.87%
Notes to Schedule:
Valuation Date:June 30, 2017
Assumptions Used:Entry Age Method used for Actuarial Cost Method
Level Percentage of Payroll and Direct Rate Smoothing
3.8 Years Remaining Amortization Period
Inflation Assumed at 2.5%
Investment Rate of Returns set at 7.15%
Fiscal year 2015 was the first year of implementation, therefore only five years are shown.
The CalPERS discount rate was increased from 7.5% to 7.65% in fiscal year 2016 and then decreased from 7.65%
to 7.15% in fiscal year 2018.
The CalPERS mortality assumptions was adjusted in fiscal year 2019.
Midpeninsula Regional Open Space District
Schedule of Pension Plan Contributions
June 30, 2019
CalPERS mortality table based on CalPERS' experience and include 15 years of projected ongoing
mortality improvement using 90 percent of Scale MP 2016 published by the Society of Actuaries.
75
Miscellaneous Plan
Plan Measurement Date 2014 2015 2016 2017 2018
Fiscal Year Ended 2015 2016 2017 2018 2019
Proportion of Net Pension Liability 0.39847%0.41627%0.29137%0.27962%0.27629%
Proportionate Share of Net Pension Liability 9,848,203$ 11,420,126$10,121,906$11,022,824$10,412,478$
Covered Payroll 8,448,635$ 8,994,979$ 9,862,578$ 11,834,150$12,802,887$
Proportionate Share of NPL as a %
of Covered Payroll 116.57%126.96%102.63%93.14%81.33%
Plan's Fiduciary Net Position as a % of the TPL 81.15%79.23%80.93%82.04%84.37%
Fiscal year 2015 was the first year of implementation, therefore only five years are shown.
The CalPERS discount rate was increased from 7.5% to 7.65% in fiscal year 2016 and then decreased from 7.65%
to 7.15% in fiscal year 2018.
The CalPERS mortality assumptions was adjusted in fiscal year 2019.
June 30, 2019
Schedule of Net Pension Liability Proportionate Shares
Midpeninsula Regional Open Space District
76
Fiscal Year Ended 2018 2019
Actuarially determined contribution (ADC)609,000$ 624,000$
Less: actual contribution in relation to ADC (412,000) (670,768)
Contribution deficiency (excess)197,000$ (46,768)$
Covered employee payroll 12,802,887$ 13,550,000$
Contrib. as a % of covered employee payroll 3.22%4.95%
Notes to Schedule:
Assumptions and Methods
Valuation Date:
Measurement Date:
Actuarial Cost Method:
Amor tization Period:
Asset Valuation Method:
Actuarial Assumptions:
Discount Rate 6.75%
General Inflation 2.75%
Payroll Increases
Medical Trend
PEMHCA Minimum Increases 4.25%
Mortality Improvement
Other Notes
There were not changes in benefit terms.
There were no changes in trend rates..
The discount rate decreased from 7.0% to 6.5% in fiscal year 2019.
Midpeninsula Regional Open Space District
Schedule of Contributions for Postemployment Benefits
June 30, 2019
June 30, 2017
Aggregate - 3%
Merit - CalPERS 1997-2015 experience study
June 30, 2018
Entry age normal, level precentage of payroll
Investment gains and loses spread over 5 year rolling period
10.2 years
GASB 75 requires a schedule of contributions for the last ten fiscal years, or for as many years as are available if less
than ten years are available. GASB 75 was adopted as of June 30, 2018.
Actuarially determined contribution rates are calculated as of June 30, two years prior to the end of the fiscal year in
which contributions are reported.
Non-medicare - 7.5% for 2019, decreasing to an ultimate rate of 4.0% in 2076
and later years
Medicare - 6.5% for 2019, decreasing to an ultimate rate of 4.0% in 2076 and
later years
Mortality, Retirement,
Disability, Termination
Healthcare Participation for
Future Retirees
Currently covered: 90%
Currently waived: 60%
Post-retirement mortality projected fully generational with Society of Actuaries
Scale MP-2017
CalPERS 1997-2015 experience study
77
Fiscal Year Ended 2018 2019
Total OPEB liability
Service cost 313,000$ 321,153$
Interest 326,000 361,203
Changes of benefit terms - -
Differences between expected and actual experience - -
Changes of assumptions - -
Benefit payments (113,000) (162,000)
Implicit subsidy fullfilled - -
Net change in Total OPEB Liability 526,000 520,356
Total OPEB Liability - beginning 4,585,000 5,111,000
Total OPEB Liability - ending 5,111,000$ 5,631,356$
Plan fiduciary net position
Employer contributions 513,000$ 412,000$
Employer implict subsidy - -
Employee contributions - -
Net investment income 287,000 259,143
Difference between estimated and actual earnings - -
Benefit payments (113,000) (162,000)
Implicit subsidy fullfilled - -
Other - -
Administrative expense (1,000) (6,064)
Net change in plan fiduciary net position 686,000 503,079
Plan fiduciary net position - beginning 2,580,000 3,266,000
Plan fiduciary net position - ending 3,266,000$ 3,769,079$
Net OPEB liability (asset)1,845,000$ 1,862,277
Plan fiduciary net position as a percentage of the
total OPEB liability 63.90%66.93%
Covered Employee Payroll 11,834,150$ 12,802,887$
Net OPEB liability as a percentage of covered employee payroll 15.59%14.55%
Total OPEB liability as a percentage of covered employee payroll 43.19%43.99%
Other Notes
There were not changes in benefit terms.
There were no changes in trend rates..
The discount rate decreased from 7.0% to 6.5% in fiscal year 2019.
GASB 75 requires a schedule of contributions for the last ten fiscal years, or for as many years as are available if
less than ten years are available. GASB 75 was adopted as of June 30, 2018.
Actuarially determined contribution rates are calculated as of June 30, two years prior to the end of the fiscal year in
which contributions are reported.
Midpeninsula Regional Open Space District
Schedule of Changes in Net OPEB Liability
June 30, 2019
78
Supplementary Information
79
Page Intentionally Left Blank
80
SUPPLEMENTARY INFORMATION
BUDGETARY SCHEDULES
These schedules present comparisons of the original budget,final budget and actual revenues and expenditures
for major capital project funds and debt service funds.These schedules presents the difference between the final
budget and actuals.
BOND PROGRAM EXPENDITURES
This schedule presents the program expenditures for the Measure AA Bond Program for the current year and the
in total since the inception of the program.
81
Variance with
Final Budget
Actual Positive -
Original Final (GAAP Basis)(Negative)
Revenues:
Property taxes -$ -$ -$ -$
Grant income - - - -
Property management - - - -
Investment earnings - - 399,613 399,613
Other revenues - - - -
Total revenues - - 399,613 399,613
Expenditures:
Current
Salaries and employee benefits - - - -
Services and supplies 880,900 4,700 1,334 3,366
Capital outlay 38,359,100 35,999,584 34,854,151 1,145,433
Total expenditures 39,240,000 36,004,284 34,855,485 1,148,799
Excess (deficiency) of revenues
over (under) expenditures (39,240,000) (36,004,284) (34,455,872) 1,548,412
Other financing sources (uses):
Transfers in 3,294,050 3,294,050 37,148,401 33,854,351
Transfers out - - (1,481,755) (1,481,755)
Total other financing sources (uses)3,294,050 3,294,050 35,666,646 32,372,596
Net change in fund balance (35,945,950) (32,710,234) 1,210,774 33,921,008
Fund balance beginning 7,043,765 7,043,765 7,043,765 -
Fund balance ending (28,902,185)$ (25,666,469)$ 8,254,539$ 33,921,008$
Budgeted Amounts
Midpeninsula Regional Open Space District
Schedule of Revenues, Expenditures and Changes in Fund Balance
Budget to Actual (GAAP)
GF Capital Projects Fund
For the Fiscal Year Ended June 30, 2019
82
Variance with
Final Budget
Actual Positive -
Original Final (GAAP Basis)(Negative)
Revenues:
Property taxes -$ -$ -$ -$
Grant income 1,042,040 937,604 620,869 (316,735)
Property management - - - -
Investment earnings - - 1,726,441 1,726,441
Other revenues - - - -
Total revenues 1,042,040 937,604 2,347,310 1,409,706
Expenditures:
Current
Salaries and employee benefits 1,176,946 866,386 368,306 498,080
Services and supplies 18,000 18,000 2,054 15,946
Capital outlay 13,631,078 11,745,696 10,501,506 1,244,190
Total expenditures 14,826,024 12,630,082 10,871,866 1,758,216
Excess (deficiency) of revenues
over (under) expenditures (13,783,984) (11,692,478) (8,524,556) 3,167,922
Other financing sources (uses):
Transfers in - - - -
Transfers out - - - -
Total other financing sources (uses)- - - -
Net change in fund balance (13,783,984) (11,692,478) (8,524,556) 3,167,922
Fund balance beginning 46,468,809 46,468,809 46,468,809 -
Fund balance ending 32,684,825$ 34,776,331$ 37,944,253$ 3,167,922$
Budgeted Amounts
Midpeninsula Regional Open Space District
Schedule of Revenues, Expenditures and Changes in Fund Balance
Budget to Actual (GAAP)
Measure AA Capital Projects Fund
For the Fiscal Year Ended June 30, 2019
83
Variance with
Final Budget
Actual Positive -
Original Final (GAAP Basis)(Negative)
Revenues:
Property taxes 5,733,551$ 5,733,551$ 5,238,150$ (495,401)$
Grant income - - - -
Property management - - - -
Investment earnings 940,000 940,000 118,773 (821,227)
Other revenues - - - -
Total revenues 6,673,551 6,673,551 5,356,923 (1,316,628)
Expenditures:
Debt service:
Principal 15,670,990 15,670,990 6,480,000 9,190,990
Interest - - 9,190,988 (9,190,988)
Total expenditures 15,670,990 15,670,990 15,670,988 2
Excess (deficiency) of revenues
over (under) expenditures (8,997,439) (8,997,439) (10,314,065) (1,316,626)
Other financing sources (uses):
Transfers in 11,320,585 11,320,585 11,298,825 (21,760)
Transfers out - - - -
Total other financing sources (uses)11,320,585 11,320,585 11,298,825 (21,760)
Net change in fund balance 2,323,146 2,323,146 984,760 (1,338,386)
Fund balance beginning 5,791,164 5,791,164 5,791,164 -
Fund balance ending 8,114,310$ 8,114,310$ 6,775,924$ (1,338,386)$
Budgeted Amounts
Midpeninsula Regional Open Space District
Schedule of Revenues, Expenditures and Changes in Fund Balance
Budget to Actual (GAAP)
Debt Service Fund
For the Fiscal Year Ended June 30, 2019
84
Expenditures Expenditures
from from
July 1, 2018 Inception
through through
Project No.Project Description June 30, 2019 June 30, 2019
20005 New Trail Easement - SFPUC, Ravenswood (MAA 2-2)(22,603)$ A -$ -$
20088 POST Hendry's Creek Restoration (MAA 22-1)(41,330) B - -
20101 Lysons Property ( 17-1 MAA )(27,059) C - -
20102 Lobner Demolition (MAA 17-2)(128,760)C - -
20109 Riggs Property Appraisal - (3-1 MAA)(6,500) D - -
20110 Purisima Creek Uplands Lot line Adjustment (3-1 MAA)(13,000) D - -
20112 Conservation Easement Upper Alpine Ranch Area (15-1 MAA)(8,695) E - -
20113 Preservation of Upper Los Gatos Creek Watershed (22-1 MAA)(5,000) B - -
20114 Land Conservation Opportunities MAA 25-1 (Burtons )(150) F - -
30503 ECDM Trail Improvements (MAA 4-4)(3,930) G - -
30904 Mindego Area - Mindego Hill Trail (MAA 9-4)(34,196) H - -
31309 Mt Um Bald Mtn Staging to Summit Trail (MAA 23-2)(17,646) I - -
31310 Mt Um Summit Restor & Improv (MAA 23-4)(79,491) I - -
31311 Mt Um Trail Overlook & Bridges (MAA 23-5)(243) I - -
31500 Measure AA Project 11-1 (728) J - -
65101 PCR Harkins Bridge Replacement (MAA 3-4)(108,788)D - -
65201 Lower Stevens Canyon Hiking Bridge (MAA 17-4)(103,187)C - -
80016 ECdM Creek Watershed Protection Program (MAA 4-3)(45,507) G - -
80029 Pond DR05 Repair (MAA 7-5)(150,682)K - -
80037 Mindego Grazing Infrastructure (MAA 9-1)(135,748)H - -
80038 LHC Grazing Infrastructure - McDonald Ranch Fencing (MAA 5-2)(178,850)L - -
AA01 Miramontes Ridge - Gateway to San Mateo Coast - (52,915.00) -
AA02 Bayfront Habitat Protection & Public Access Partnerships 22,603 A 1,327,008.00 2,046,671
AA03 Purisima Creek Redwoods: Purisma-to Sea Trail, Watershed/Graze 128,288 D 160,306.00 1,270,676
AA04 El Corte de Madera Creek: Bike Trail & Water Quality 49,437 G 306,910.00 886,868
AA05 La Honda Creek - Upper Recreation Area 178,850 L 17,055.00 2,428,759
AA06 Hawthorn Public Access Improvements - 18,112.00 26,602
AA07 Driscoll Ranch Public Access, Wildlife Protection, Grazing 150,682 K 121,948.00 12,161,434
AA08 La Honda/Russian Ridge: Upper San Gregorio Watershed - 2,153,910.00 2,153,910
AA09 Russian Ridge: Public Recreation, Grazing & Wildlife Protection 169,944 H 77,512.00 319,467
AA10 Coal Creek: Reopen Alpine Road for Trail Use - 144,173.00 166,122
AA11 Rancho San Antonio: Interpretive Improvements, Refurbishing 728 J 3,025.00 33,264
AA15 Regional: Redwood Protection & Salmon Fishery Conservation 8,695 E 14,500.00 3,033,050
AA17 Regional: Complete Upper Stevens Creek Trail 259,006 C 275,086.00 2,055,333
AA18 South Bay Foothills: Saratoga-to-Sea Trail & Wildlife Corridor - 3,850.00 3,850
AA19 El Sereno Dog Park & Connections - 52,977.00 480,242
AA20 South Bay Foothills: Wildlife Passage/Ridge Trail Improvements - 193,367.00 390,203
AA21 CR:Pub Recreation Proj - 4,848,581.00 8,275,686
AA22 Cathedral Oaks Public Access & Conservation 46,330 B 368,992.00 1,077,895
AA23 Mt Um Pub Access/Intrep 97,380 I 852,369.00 22,934,442
AA24 Rancho de Guadalupe Family Recreation - (14,900.00) 1,591,996
AA25 Loma Prieta Area Public Access 150 F - 410,150
Total MAA Bond Project Expenditures - 10,871,866 61,746,620
Reimbursements from Grants, Contributions, and Other Funds - (620,869) (3,315,613)
Total MAA Bond Project Expenditures - Net Reimbursements -$ 10,250,997$ 58,431,007$
During fiscal ye ar ending June 30, 2019,the District realigned pre-existing project numbers eligible for Measure AA (MAA)funding with
the Measure AA projects numbers (MAA)for ease of project review.Letters in adjustment column indicate the transfer of expenses
between project numbers.Prior expenditure balances related to appraisals and land surveys in MAA01 "Miramontes Ridge -Gateway to
San Mateo Coast"and MAA24 “Sierra Azul:Rancho de Guadalupe Family Recreation Projects”were removed as the transactions failed to
materialize.
Adjustments
Midpeninsula Regional Open Space District
Measure AA Bond Program
Schedule of Program Expenditures
June 30, 2019
85
Midpeninsula Regional Open Space District
Notes to Supplementary Information
June 30, 2019
NOTE 1 - BACKGROUND
Measure AA is a $300 million general obligation bond approved in June 2014 by over two-thirds of
Midpen voters.Proceeds from bonds, which will be sold in a series over approximately the next 20-
30 years, will be used to:
Protect natural open space lands
Open preserves or areas of preserves that are currently closed
Construct public access improvements such as new trails and staging areas
Restore and enhance open space land,which includes forests, streams, watersheds, and
coastal ranch areas.
On July 29, 2015,the District issued $40,000,000 of 2015A general obligation bonds and $5,000,000
of 2015B federally taxable general obligation bonds to finance certain projects authorized by voters.
The bonds bear interest from 1.5% to 5% and are due semi-annually on March 1 and September 1.
The bonds were issued at a premium of $2,559,224 with an underwriter’s discount of $107,599 and
issuance costs of $170,000.
On February 1, 2018, the District issued $50,000,000 of 2018 general obligation bonds to finance 25
projects specified in Measure AA. The bonds bear interest from 2% to 5% and are due semi-annually on
March 1 and September 1. The bonds were issued at a premium of $3,691,291 with an issuance costs of
$455,462.
Land acquisition is the first step to open space conservation. The Vision Plan identified 50,000 acres
of open space land that, when conserved, would significantly improve wildlife conditions, wetlands,
watersheds, creeks, sensitive plant communities and healthy outdoor recreation. As of June 30, 2019,
the District has acquired and / or preserved over 1,700 acres of land with $24 million in funding
support from Measure AA Funds.
NOTE 2 -OVERISGHT COMMITTEE
The Oversight Committee is essential to implementing Measure AA and will consist of seven at-
large members who reside within the District. The Committee convenes at least once a year and
reviews annual Measure AA expenditures and Midpen’s Annual Audit and Accountability report.
Each year,the Committee’s findings will be presented to the Board at a public meeting and will be
posted on the District’s website.
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The basis of accounting utilized in preparation of this report may differ from accounting principles
generally accepted in the United States of America. Accordingly, the accompanying program
statement is not intended to present the financial position and the results of operations in conformity
with accounting principles generally accepted in the United States of America.Expenditures incurred
with Measure AA Bond proceeds are recorded on a modified accrual basis of accounting. Under the
modified accrual basis of accounting, revenue is recognized when it is measureable and available.
Similarly,expenses are recognized when they are incurred, not when they are paid.
86
Statistical Information
87
Page Intentionally Left Blank
88
Financial Trends
Revenue Capacity
Debt Capacity
Demographic and Economic Information
Operating Information
Sources
These schedules contain service and infrastructure data to help the reader understand how the information in the District’s financial report relates to
the services the District provides and the activities it performs:
1. Full-Time Equivalent Employees by Function
2. Capital Asset Statistics by Function
3. Operating Indicators by Function
Unless otherwise noted, the information in these schedules is derived from the Annual Financial Reports for the relevant year.
STATISTICAL SECTION
This part of the District’s Comprehensive Annual Financial Report presents detailed information as a context for understanding what the
information in the financial statements,note disclosures,and required supplementary information says about the District’s overall financial
health. In contrast to the financial section, the statistical section information is not subject to independent audit.
These schedules contain trend information to help the reader understand how the District’s financial performance and well being have changed over
time:
1. Net Position
2. Changes in Net Position
3. Fund Balances of Governmental Funds
4. Changes in Fund Balances of Governmental Funds
These schedules contain information in relation to the District’s property tax assessments:
1. Assessed and Actual Value of Taxable Property
2. Direct and Overlapping Property Tax Rates
3. Pricipal Property Tax Payers
4. Property Tax Levies and Collections
These schedules present information to help the reader assess the affordability of the District’s current levels of outstanding debt and the District’s
ability to issue additional debt in the future:
1. Ratios of General Bonded Debt Outstanding
2. Ratios of Outstanding Debt by Type
3. Legal Debt Margin Information
These schedules offer demographic and economic indicators to help the reader understand the environment within which the District’s financial
activities take place:
1. Demographic and Economic Statistics
2. Principal Employers
89
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Governmental activities
Net investment in capital assets 225,092$ 236,546$ 245,393$ 259,638$ 268,869$ 278,611$ 276,395$ 308,601$ 312,121$ 351,152$
Restricted 1,417 1,408 1,568 2,731 4,327 2,566 5,786 4,571 7,252 8,207
Unrestricted 30,450 28,142 42,738 36,919 37,951 39,948 39,280 23,831 29,415 8,015
Total Net Position 256,959$ 266,096$ 289,699$ 299,288$ 311,147$ 321,125$ 321,461$ 337,003$ 348,788$ 367,374$
Source: Annual Financial Report
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY 2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
Midpeninsula Regional Open Space District
Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
(amounts expressed in thousands)
90
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Expenses
Governmental activities
Land preservation 13,254$ 13,768$ 14,312$ 19,338$ 17,930$ 19,478$ 26,080$ 21,783$ 28,910$ 34,304$
Interest and fiscal charges 6,208 6,739 7,483 7,273 7,163 7,202 9,752 8,327 8,193 10,449
Depreciation 715 882 806 840 1,095 1,232 1,311 1,585 2,399 -
Loss on refunding of debt 381 - - - - - - - - -
Total governmental activities expenses 20,558 21,389 22,601 27,451 26,188 27,912 37,143 31,695 39,502 44,753
Program Revenues
Governmental Activities
Charges for Services 911 1,241 1,320 1,381 1,422 1,437 1,636 1,479 1,576 2,360
Grants and Contributions 659 1,393 1,453 913 1,901 953 1,194 651 1,613 1,082
Land donations 2,259 17 13,928 3,890 - - - - - -
Total governmental activities program revenues 3,829 2,651 16,701 6,184 3,323 2,390 2,830 2,130 3,189 3,442
Net (expense)/revenue - governmental activities (16,729) (18,738) (5,900) (21,267) (22,865) (25,522) (34,313) (29,565) (36,313) (41,311)
General Revenues and Other Changes in Net Position
Governmental Activities
Property taxes 27,631 27,269 28,737 30,270 32,433 35,082 44,980 43,861 47,798 54,395
Investment earnings - 294 375 288 138 202 648 463 1,045 3,628
Use of money and property 80 - - - - - - - - -
Miscellaneous 216 311 394 298 182 216 810 784 1,153 1,874
Total governmental activities 27,927 27,874 29,506 30,856 32,753 35,500 46,438 45,108 49,996 59,897
Change in Net Position
Governmental activities 11,198 9,136 23,606 9,589 9,888 9,978 12,125 15,543 13,683 18,586
Prior period adjustments - - - - 1,971 - (11,790) - (1,898) -
Total Changes in Net Position 11,198$ 9,136$ 23,606$ 9,589$ 11,859$ 9,978$ 335$ 15,543$ 11,785$ 18,586$
Source: Annual Financial Report
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY 2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
Starting FY 2018-19 depreciation expenses were allocated to land preservation.
Midpeninsula Regional Open Space District
Changes in Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
(amounts expressed in thousands)
91
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
General fund
Reserved 579$ -$ -$ -$ -$ -$ -$ -$ -$ -$
Unreserved, designated in 15,657 - - - - - - - - -
Unreserved, reported in 12,678 - - - - - - - - -
Nonspendable - - - - - - - 55 36 186
Restricted - 731 - - 1,702 1,702 1,971 1,971 1,467 3,963
Committed - - - - - 20,400 35,400 35,400 42,300 29,288
Assigned - - - - 5,000 - - - - 1,400
Unassigned - 26,156 41,782 37,513 34,453 21,330 16,848 23,872 29,306 16,515
Total General Fund 28,914$ 26,887$ 41,782$ 37,513$ 41,155$ 43,432$ 54,219$ 61,298$ 73,109$ 51,352$
All other governmental funds
Reserved 1,417$ -$ -$ -$ -$ -$ -$ -$ -$ -$
Restricted - 1,408 1,568 1,634 1,621 - 26,894 9,539 59,304 52,975
Total all other governmental funds 1,417$ 1,408$ 1,568$ 1,634$ 1,621$ -$ 26,894$ 9,539$ 59,304$ 52,975$
Source: Annual Financial Report
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY 2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
The District has implemented GASB 54 effective fiscal year ending March 31, 2011.
This Statement establishes new categories for reporting fund balance and revises the definitions for governmental fund types.
The District opted not to change the previous years' data.
(modified accrual basis of accounting)
(amounts expressed in thousands)
Midpeninsula Regional Open Space District
Fund Balances of Governmental Funds
Last Ten Fiscal Years
92
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
REVENUES
Property taxes 27,631$ 27,269$ 28,737$ 30,270$ 32,433$ 35,082$ 44,980$ 43,861$ 47,798$ 54,395$
Grant income 659 1,393 1,453 913 1,901 953 1,194 651 1,613 1,082
Property management 911 955 1,320 1,381 1,422 1,438 1,636 1,479 1,576 2,360
Investment earnings 80 294 375 288 150 216 666 480 1,064 3,649
Other 224 551 240 146 145 241 644 609 348 641
Land donation 2,258 17 13,928 - - - - - - -
TOTAL REVENUE 31,763 30,479 46,053 32,998 36,051 37,930 49,120 47,080 52,399 62,127
EXPENDITURES
Land Preservation 13,070 13,682 13,996 18,713 17,303 18,272 28,965 25,807 28,226 29,186
Capital outlay 18,557 11,596 27,190 9,611 8,231 8,445 18,901 19,961 16,440 45,356
Debt service:
Principal and advance refunding escrow 2,900 3,301 4,457 2,843 2,999 3,145 4,367 5,193 6,392 6,480
Interest and fiscal charges 4,919 4,786 5,355 6,034 5,859 5,749 6,478 7,190 6,597 9,191
TOTAL EXPENDITURES 39,446 33,365 50,998 37,201 34,392 35,611 58,711 58,152 57,655 90,213
EXCESS (DEFICIT) OF REVENUES
OVER EXPENDITURES (7,683) (2,886) (4,945) (4,203) 1,659 2,319 (9,591) (11,072) (5,256) (28,086)
OTHER FINANCING SOURCES AND USES
Transfers in 7,829 7,974 9,827 8,877 8,858 8,894 12,146 15,839 9,409 49,929
Transfers out (7,829) (7,974) (9,827) (8,877) (8,858) (8,894) (12,146) (15,839) (9,409) (49,929)
Other sources - 850 20,000 - - - - - - -
Payment to refunded bond escrow agent - - - - - - - (68,187) (27,660) -
Issuance of refunding debt - - - - - - - 57,410 25,025 -
Advance refunding of revenue bonds - - - - - (29,987) - - - -
Issuance of debt - - - - - 28,325 45,000 - 61,220 -
Premium from debt issuances - - - - - - 2,282 11,564 8,246 -
TOTAL OTHER FINANCING SOURCES (USES)- 850 20,000 - - (1,662) 47,282 787 66,831 -
SPECIAL ITEM
OPEB Funding - - - - - - - - - -
NET CHANGES IN FUND BALANCES (7,683)$ (2,036)$ 15,055$ (4,203)$ 1,659$ 657$ 37,691$ (10,285)$ 61,575$ (28,086)$
Capitalized capital outlay expenditures 18,557 11,596 28,306 13,501 7,486 7,906 18,222 20,265 17,411 45,355
Debt Service as a percentage of noncapital expenditures 37.43%37.15%43.24%37.46%32.92%32.10%26.79%32.69%32.28%34.93%
Source: Annual Financial Report
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY 2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
Midpeninsula Regional Open Space District
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
(amounts expressed in thousands)
93
Fiscal Year Secured State Board Unsecured
Total before
Rdv. Increment
Total after Rdv.
Increment Total Direct Tax Rate
2010 108,749,899$ 5,138$ 7,220,172$ 115,975,209$ 110,945,627$ 1.00%
2011 108,672,177 5,138 6,448,241 115,125,556 110,403,735 1.00%
2012 110,480,451 5,192 6,843,137 117,328,780 112,337,379 1.00%
2013 115,665,767 5,192 7,574,405 123,245,364 117,796,453 1.00%
2014 125,816,313 5,192 8,032,680 133,854,185 128,261,360 1.00%
2015 134,293,819 3,616 8,134,278 142,431,713 136,364,266 1.00%
2016 148,710,117 3,616 8,236,861 156,950,594 151,221,560 1.00%
2017 161,457,837 3,616 8,664,927 170,126,380 163,586,434 1.00%
2018 174,219,310 3,616 9,773,726 183,996,652 177,153,795 1.00%
2019 188,007,378 8,646 10,266,764 198,282,788 191,359,437 1.00%
Fiscal Year Secured State Board Unsecured
Total before
Rdv. Increment
Total after Rdv.
Increment Total Direct Tax Rate
2010 51,288,838$ 6,652$ 2,039,518$ 53,335,008$ 49,431,098$ 1.00%
2011 51,197,326 6,653 2,006,682 53,210,661 49,373,928 1.00%
2012 51,670,521 2,465 1,952,159 53,625,145 49,913,049 1.00%
2013 53,793,234 2,465 1,948,563 55,744,262 51,977,724 1.00%
2014 57,513,572 2,336 2,180,554 59,696,462 55,714,674 1.00%
2015 60,798,837 2,343 2,087,353 62,888,533 58,641,318 1.00%
2016 66,177,633 3,086 2,363,781 68,544,500 63,519,108 1.00%
2017 72,017,698 3,085 2,640,434 74,661,217 68,354,025 1.00%
2018 78,506,564 3,085 2,996,701 81,506,350 73,565,159 1.00%
2019 85,236,395 2,658 2,756,478 87,995,531 79,176,299 1.00%
Source: California Municipal Statistics, Inc
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY 2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
County of San Mateo
Midpeninsula Regional Open Space District
Assessed and Actual Value of Taxable Property
Last Ten Fiscal Years
(amounts expressed in thousands)
County of Santa Clara
94
Fiscal Year
General Property
Tax Levy
Other
Overlapping
Governments
Open Space
District Total
General Property
Tax Levy
Other
Overlapping
Governments
Open Space
District Total
2010 1.00000 0.11987 - 1.11987 1.00000 0.06970 - 1.06970
2011 1.00000 0.14951 - 1.14951 1.00000 0.07530 - 1.07530
2012 1.00000 0.15060 - 1.15060 1.00000 0.08120 - 1.08120
2013 1.00000 0.18750 - 1.18750 1.00000 0.08060 - 1.08060
2014 1.00000 0.18740 - 1.18740 1.00000 0.07470 - 1.07470
2015 1.00000 0.18304 - 1.18304 1.00000 0.08530 - 1.08530
2016 4 1.00000 0.17807 0.00080 1.17887 1.00000 0.08420 0.00080 1.08500
2017 1.00000 0.17160 0.00060 1.17220 1.00000 0.10990 0.00060 1.11050
2018 1.00000 0.18133 0.00090 1.18223 1.00000 0.10300 0.00090 1.10390
2019 1.00000 0.17126 0.00180 1.17306 1.00000 0.09240 0.00180 1.09420
Source: California Municipal Statistics, Inc.
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY 2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
1 Due to the District’s size and that it is located in two counties (County of Santa Cruz excluded), there is no tax rate area that represents the typical
total tax rate for the District. The above tax rate areas are the largest in terms of assessed valuation for each County’s portion of the District.
2 The 2015-16 assessed valuation of Tax Rate Area (TRA) 6-001 is $23,936,719,617, which is 10.62% of the District’s total assessed valuation.
3 The 2015-16 assessed valuation of TRA 9-001 is $8,109,918,455, which is 3.60% of the District’s total assessed valuation.
4 Fiscal Year 2015-16 was the first year in which ad valorem property taxes authorized by Measure AA were levied.
Midpeninsula Regional Open Space District
Property Tax Rates
Direct and Overlapping1 Property Tax Rates
Last Ten Fiscal Years
County of Santa Clara (Tax Rate Area 6-001) 2 County of San Mateo (Tax Rate Area 9-001) 3
95
Taxpayer
Taxable Assessed
Valuation Rank
Percentage of
Total Assessed
Valuation
Taxable Assessed
Valuation Rank
Percentage of
Total Assessed
Valuation
Board of Trustees, Leland Stanford Jr. University 6,609,910$ 1 2.48%4,249,763$ 1 2.66%
Google Inc.5,351,042 2 1.39%436,617 7 0.27%
Campus Holdings Inc. 3,504,317 3 1.22%**
Apple Computer Inc. 1,226,952 4 0.49%659,212 2 0.41%
Hibscus Properties LLC 1,107,164 5 ***
Sobrato Interests 1,063,697 6 0.31%**
Lockheed Missiles and Space Co. Inc.890,576 7 0.39%558,761 3 0.35%
Yahoo Holdings Inc.656,370 8 *416,320 8 0.26%
Oracle Corp. 638,903 9 0.25%530,234 4 0.33%
Richard T. Spieker, Trustee 616,741 10 ***
Menlo & Juniper Networks LLC 612,073 11 0.24%**
Applied Materials Inc.531,041 12 0.19%414,549 9 0.26%
Facebook Inc.490,838 13 ***
Intuitive Surgical Inc.490,801 14 ***
Peninsula Innovation Partnersh LLC 471,036 15 ***
CW SPE LLC 459,732 16 ***
Woodland Park Property Owner LLC 418,738 17 ***
441 Real Estate LLC 406,680 18 ***
Network Appliance Inc. 383,803 19 0.20%464,314 6 0.29%
LinkedIn Corporation 376,325 20 ***
VII Pac Shores Investors LLC **506,399 5 0.32%
Arden Realty LP **372,904 11 0.23%
HCP Life Science REIT Inc.**316,304 14 0.20%
Wells REIT II-University Circle LP **310,934 15 0.19%
SPF Mathilda LLC **277,440 16 0.17%
Silicon Valley CA I LLC **259,131 17 0.16%
Westport Office Park LLC **254,372 18 0.16%
Spansion LLC **229,155 19 0.14%
Loral Space & Communications, Inc.**210,131 20 0.13%
Hewlett Packard Co.**317,777 13 0.20%
Symantec Corporation **376,878 10 0.24%
Sun Microsystems Inc. **355,400 12 0.22%
Total 26,306,739$ 7.16%11,516,595$ 7.19%
* Information not available
Source: California Municipal Statistics, Inc.
Midpeninsula Regional Open Space District
Principal Property Tax Payers
Current Year and Nine Years Ago
(amounts expressed in thousands)
Fiscal Year 2010Fiscal Year 2019
96
Fiscal Year
Santa Clara County
Taxes Levied
San Mateo County
Taxes Levied
Santa Clara County
Collections
% of County
Levy
San Mateo County
Collections
% of County
Levy
2016 1,186,363$ 527,932$ 1,177,636$ 99.3%524,982$ 99.4%
2017 968,301 431,711 962,730 99.4%429,436 99.5%
2018 1,558,456 705,842 1,553,773 99.7%701,923 99.4%
2019 3,365,744 1,532,834 3,348,991 99.5%1,524,259 99.4%
Source: California Municipal Statistics, Inc.
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY 2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
1 District's general obligation bond debt service levy. Prior years are not available. Levy began in FY2015-16
CollectionsLevy 1
Midpeninsula Regional Open Space District
Property Tax Levies and Collections
Last Ten Fiscal Years
97
Fiscal Year
General
Obligation Bonds
Debt Service
Monies Available Total
Taxable Assessed
Value
Percentage of
Taxable AV 1 Per Capita 2
2010 -$ -$ -$ 160,376,725$ 0.000%-$
2011 - - - 159,777,663 0.000%-
2012 - - - 162,250,428 0.000%-
2013 - - - 169,774,177 0.000%-
2014 - - - 183,976,034 0.000%-
2015 - - - 195,005,584 0.000%-
2016 45,000 3,116 41,884 214,740,668 0.020%15.55
2017 44,225 2,194 42,031 231,940,459 0.018%15.52
2018 104,570 5,785 98,785 250,718,954 0.039%36.17
2019 102,880 6,776 96,104 270,535,736 0.036%*
*Information not available
Source: Annual Financial Report
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY 2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
1 See the Schedule of Assessed and Actual Value of Taxable Property for property value data.
2 Population data can be found in the Schedule of Demographic and Economic Statistics.
Midpeninsula Regional Open Space District
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years
(amounts expressed in thousands, except per-capita amount)
98
Fiscal Year
General
Obligation
Bonds
Lease
Revenue
Bonds Refunding Bonds Bond Premiums Notes Payable Total
Taxable Assessed
Value (AV)
Percentage of
Taxable AV
Percentage
of Personal
Income Per Capita
2010 -$ 65,049$ 52,204$ 663$ 5,755$ 123,671$ 160,376,725$ 0.077% 0.113%916$
2011 - 64,995 50,988 607 6,429 123,019 159,777,663 0.077% 0.102% 841.22
2012 - 51,947 49,179 2,515 36,898 140,539 162,250,428 0.087% 0.105% 874.60
2013 - 51,568 47,994 2,351 37,039 138,952 169,774,177 0.082% 0.102% 867.07
2014 - 51,021 50,665 2,188 36,285 140,159 183,976,034 0.076% 0.094% 811.92
2015 - 20,385 49,935 6,973 59,271 136,564 195,005,584 0.070% 0.083% 723.87
2016 45,000 20,290 47,300 9,087 58,698 180,375 214,740,668 0.084%**
2017 44,225 1,080 57,410 20,475 58,761 181,951 231,940,459 0.078%**
2018 104,570 930 78,870 26,839 34,466 245,675 250,718,954 0.098%**
2019 102,880 750 75,460 25,567 33,749 238,406 270,535,736 0.088%**
*Information not available
Source: Annual Financial Report
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY 2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
(1)Details regarding the District's outstanding debt can be found in the notes to the financial statements.
(2)Refer to the Demographics Statistics for personal income and population data.
Ratios of Outstanding Debt
Last Ten Fiscal Years
Midpeninsula Regional Open Space District
(amounts expressed in thousands, except per-capita amount)
99
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Assessed Valuation:
Assessed value subject to debt levy 160,376,725$159,777,663$162,250,428$169,774,177$183,976,034$195,005,584$214,740,668$231,940,459$250,718,954$270,535,736$
Total assessed valuation 160,376,725 159,777,663 162,250,428 169,774,177 183,976,034 195,005,584 214,740,668 231,940,459 250,718,954 270,535,736
Debt Applicable to Limitation:
Total debt 123,671 123,019 140,539 138,952 140,159 136,564 180,375 181,951 245,675 -
Less: amount available for repayment - - - - - - 3,116 2,194 5,785 -
Total debt applicable to limitation 123,671 123,019 140,539 138,952 140,159 136,564 177,259 179,757 239,890 -
Legal Debt Margin:
Bonded debt limit (15% AV)24,056,509 23,966,649 24,337,564 25,466,127 27,596,405 29,250,838 32,211,100 34,791,069 37,607,843 40,580,360
Debt applicable to limitation 123,671 123,019 140,539 138,952 140,159 136,564 177,259 179,757 239,890 -
Legal debt margin 23,932,838$ 23,843,630$ 24,197,025$ 25,327,175$ 27,456,246$ 29,114,274$ 32,033,841$ 34,611,312$ 37,367,953$ 40,580,360$
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY 2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
Under California Government Code Section 61126 (b) the Midpeninsula Regional Open Space District shall not incur bonded
indebtedness that exceeds 15% of the total assessed property value.
Midpeninsula Regional Open Space District
Legal Debt Margin Information
Last Ten Fiscal Years
(amounts expressed in thousands)
100
Fiscal Year Population 1
Personal Income 2
(in millions)
Per Capita
Personal Income 2
Median
Age 3
School
Enrollment 4
County Unemployment
Rate 5
2010 1,880,876 109,495$ 61,289$ 35.8 265,643 10.5%
2011 1,797,375 120,376 66,366 36.0 266,256 9.6%
2012 1,816,486 133,912 72,704 36.2 270,109 8.2%
2013 1,842,254 136,118 72,754 36.4 273,701 6.8%
2014 1,868,558 149,717 78,955 36.6 276,175 5.2%
2015 1,889,638 165,323 86,141 36.8 276,689 4.3%
2016 1,927,888 178,029 92,168 36.8 274,948 3.9%
2017 1,938,180 190,002 98,032 *273,264 3.4%
2018 1,956,958 ***272,132 2.9%
2019 1,954,286 ***267,224 2.9%
Calendar Year Population 1
Personal Income 2
(in millions)
Per Capita
Personal Income 2
Median
Age 3
School
Enrollment 4
County Unemployment
Rate 5
2010 719,951 53,084$ 73,739$ 39.3 91,371 8.5%
2011 729,425 58,228 79,872 39.4 92,097 7.9%
2012 740,738 65,167 87,986 39.6 93,674 6.8%
2013 750,489 65,656 87,501 39.3 93,931 5.6%
2014 758,581 71,111 93,672 39.4 94,567 4.3%
2015 759,155 78,607 102,516 39.8 95,187 3.5%
2016 765,895 82,046 106,615 39.5 95,502 3.2%
2017 770,203 87,486 113,410 *95,620 2.9%
2018 774,155 ***95,155 2.5%
2019 774,485 ***94,234 2.4%
* Information not available
Data Sources
1 State of California Department of Finance
2 U.S. Department of Commerce Bureau of Economic Analysis
3 U.S Census Bureau, American Community Survey
4 State of California Department of Education
5 State of California Employment Development Department, Labor Market Division
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY 2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
Midpeninsula Regional Open Space District
Demographic and Economic Statistics
Last Ten Fiscal Years
County of Santa Clara
County of San Mateo
101
Employer
Number of
Employees 1 Rank
Percentage of
Total
Employment
Number of
Employees 2 Rank
Percentage of
Total
Employment
Apple Computer, Inc.25,000 1 2.44%10,000 3 1.23%
Alphabet/Google Inc.20,000 2 1.95%**
County of Santa Clara 18,806 3 1.84%**
Stanford University 16,919 4 1.65%**
Cisco Systems Inc.14,120 5 1.38%13,000 1 1.60%
Kaiser Permanente 12,500 6 1.22%5,000 10 0.61%
Stanford Healthcare 10,034 7 0.98%5,500 8 0.68%
Tesla Mortors Inc. 10,000 8 0.98%*
Intel Corporation 8,450 9 0.83%5,000 9 0.61%
City of San Jose 6,159 10 0.60%*
Lockheed Martin Space Systems Co.**10,400 2 1.28%
Intuit, Inc.**8,000 4 0.98%
IBM Corporation **7,650 5 0.94%
Hewlett-Packard Co. **7,000 6 0.86%
KLA-Tencor Corporation **6,200 7 0.76%
Total 141,988 13.87%77,750 9.55%
Employer
Number of
Employees Rank
Percentage of
Total
Employment
Number of
Employees Rank
Percentage of
Total
Employment
United Airlines 12,000 1 2.74%**
Genentech Inc. 11,000 2 2.51%8,800 1 2.60%
Facebook Inc. 7,091 3 1.62%**
Oracle Corp.6,781 4 1.55%5,642 2 1.66%
County of San Mateo 5,485 5 1.25%5,179 3 1.53%
Gilead Sciences Inc. 3,900 6 0.89%1,480 10 0.44%
Visa U.S.A. Inc.3,500 7 0.80%**
Electronics Arts Inc.2,367 8 0.54%2,000 6 0.59%
Roberto Half International Inc.1,790 9 0.41%**
You Tube LLC.1,700 10 0.39%**
Kaiser Permanente **3,790 4 1.12%
Mills-Peninsula Health Services **2,500 5 0.74%
United States Postal Service **1,964 7 0.58%
San Mateo Community College District **1,800 8 0.53%
SLAC National Accelerator Laboratory **1,650 9 0.49%
Total 55,614 12.70%34,805 10.28%
* Information not available
Source:
1 Silicon Valley Business Journal, July 27, 2018
2 County of Santa Clara Finance Department. FY2008-09 CAFR
3 San Francisco Business Times - 2018 Book of Lists and California Employment Development Department
4 Latest information available for principal employers in the County of San Mateo and County of Santa Clara.
2017 4 2009
County of San Mateo 3
County of Santa Clara
Midpeninsula Regional Open Space District
Principal Employers
Most Current Year and Nine Years Ago
2018 4 2009
102
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Function
Office of the General Manager 3.00 3.00 4.00 4.00 4.00 5.00 6.00 8.00 8.00 8.00
Real Property 5.00 5.00 5.00 5.00 5.00 6.00 7.00 4.00 5.00 5.00
Plannning 13.50 14.00 14.00 14.00 14.00 14.00 14.00 10.50 11.50 10.50
Engineering & Construction N/A N/A N/A N/A N/A N/A N/A 5.50 7.50 7.50
Public Affairs 8.00 8.00 8.00 9.00 9.00 11.00 12.00 8.00 8.00 8.00
Admininstration
Reception 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00
Finance 3.25 3.25 3.25 3.25 4.75 4.75 5.25 9.25 9.25 10.25
Human Resources 2.00 2.00 2.50 3.50 3.50 5.50 7.00 7.00 7.00 7.00
Information Technology 1 1.00 1.00 1.00 2.00 2.50 2.50 5.50 7.50 7.50 7.50
Operations
Administration 6.50 6.00 6.00 6.00 6.00 6.00 6.00 N/A N/A N/A
Patrol 23.00 28.00 28.00 28.00 28.00 31.00 32.00 N/A N/A N/A
Land/Facilities Maintenance 20.00 26.00 26.00 26.00 26.00 28.30 30.30 N/A N/A N/A
Resource Management 2 6.00 6.00 N/A N/A N/A N/A N/A N/A N/A N/A
Land & Facilities N/A N/A N/A N/A N/A N/A N/A 49.30 53.30 56.30
Visitor Services N/A N/A N/A N/A N/A N/A N/A 41.90 41.90 41.90
General Counsel 2.50 2.50 2.50 2.50 2.50 2.50 2.50 2.50 2.50 2.50
Natural Resources 2 N/A N/A 8.00 8.00 8.00 9.00 10.00 11.00 12.00 12.00
Total 94.75 105.75 109.25 112.25 114.25 126.55 138.55 165.45 174.45 177.45
Source: Midpeninsula Regional Open Space District
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
1 In 2015, the GIS function was integrated into Information Technology from the Planning Department
2 In 2012, the Resource Management function under the Operations Department became the Natural Resources Department
During 2015, the District underwent a complete reorganization which become effective during FY 2016-17. As part of the
reorganization, the Planning Department was split with a new Engineering & Construction Department, a portion of Real
Property and Operations became the new Land & Facilities Department, and part of Public Affairs and Operations/Patrol
became the new Visitor Services Department.
Midpeninsula Regional Open Space District
Full-time Equivalent District Government Employees by Function
Last Ten Fiscal Years
103
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Function
Land:
Number of preserves 26 26 26 26 26 26 26 26 26 26
Acreage:
Santa Clara County 31,833.31 32,380.35 32,990.49 33,006.79 33,158.80 33,259.21 33,366.71 33,449.99 33,628.15 33,630.26
San Mateo County 26,588.84 26,704.01 27,625.36 28,668.49 28,977.86 29,063.13 29,452.58 29,643.96 29,664.41 29,854.41
Santa Cruz County 2,004.18 2,004.18 2,004.18 2,004.18 2,004.18 2,004.18 2,004.18 2,004.18 2,004.18 2,004.18
less: easements and life
estates held by other parties (1,825.88)(1,825.88)(1,825.88)(1,825.88)(1,825.88)(1,825.88)(1,825.88)(1,825.88)(1,802.88)(1,802.88)
Total 58,600.45 59,262.66 60,794.15 61,853.58 62,314.96 62,500.64 62,997.59 63,272.25 63,493.86 63,493.86
Facilities:
Administrative office 1 1 1 1 1 1 1 1 1 1
Field/patrol offices 2 2 2 2 2 2 2 2 3 3
Visitor Center 2 2 2 2 2 2 2 2 2 2
Vehicles & Equipment:
Patrol vehicles 32 35 37 39 41 38 37 42 36 34
Service vehicles 3 3 3 3 5 8 10 13 10 11
Maintenance vehicles 5 6 8 9 13 16 19 25 29 31
Administrative vehicles n/a n/a n/a n/a n/a n/a n/a n/a 13 13
Motorcycles/ATVs/Electric bicycles 13 13 13 13 13 13 13 13 27 27
Bulldozers/excavators/tractors 16 17 17 20 21 21 23 23 20 23
Dump trucks 3 4 4 4 4 5 5 5 4 6
Water Truck 1 1 2 2 2 2 2 2 2 2
Trailers n/a n/a n/a n/a n/a n/a n/a n/a 25 27
Chippers/mowers 2 2 2 2 4 4 5 5 5 5
Source: Midpenninsula Regional Open Space District
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
Beginning with FY2017-18 the District is using a new system for classifying and tracking vehicles and equipment.
Midpeninsula Regional Open Space District
Capital Asset Statistics by Function
Last Ten Fiscal Years
104
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Function
General Manager
Board meetings 37 31 45 36 35 33 31 31 44 32
Resolutions adopted 50 41 56 20 39 61 61 40 46 47
Real Property
Acres preserved
Santa Clara County 204.25 547.04 492.99 16.30 152.01 100.41 107.50 83.28 178.18 2.11
San Mateo County 1,263.40 115.17 921.35 1,043.14 309.37 393.26 81.45 191.38 20.46 190.00
Public Affairs
Stewardship volunteer hours 9,849 11,314 11,843 11,232 13,579 14,354 15,839 17,440 16,088 15,910
Interpretation and education docent hours 3,305 5,433 4,669 5,559 4,718 5,828 4,462 4,697 4,320 4,438
Website visits 274,559 274,133 434,402 349,398 359,432 418,748 429,891 487,215 589,280 524,387
Operations
Bicycle Accident 25 22 36 37 30 20 26 19 37 13
Equestrian Accident 2 1 1 2 - 1 2 - - 1
Hiking/Running Accident 21 18 16 16 22 20 14 37 40 11
Other first aid 10 15 25 24 15 25 26 23 31 13
Search & rescue 11 15 10 8 5 8 3 4 2 2
Vehicle Accident 8 11 16 15 14 19 14 17 50 15
Fire 6 5 7 8 16 9 10 9 13 4
HazMat 3 3 - - 1 1 6 1 3 1
Subject Citation/Juvenile Contact Report 558 509 526 737 617 825 767 678 592 405
Parking Citation 386 434 527 621 584 700 645 836 870 375
Arrests 2 1 1 2 1 4 3 2 - 2
Day Permits 954 1,059 1,235 1,237 1,521 2,154 2,541 2,530 2,676 2,417
Multi-day permits 214 248 225 253 306 306 321 366 419 361
Camping permits 221 259 341 336 393 476 573 613 570 571
Source: Midpenninsula Regional Open Space District
Notes: Starting fiscal year (FY) 2015-16 the District changed from a fiscal year end date of March 31st to June 30th.
As a result, FY2015-16 is a fifteen (15) month period rather than a twelve (12) month period.
Midpeninsula Regional Open Space District
Operating Indicators by Function
Last Ten Fiscal Years
105
Page Intentionally Left Blank
106
Other Independent Auditor’s Reports
107
CHAVAN &ASSOCIATES,LLP
CERTIFIED PUBLIC ACCOUNTANTS
1475 Saratoga Ave, Suite 180, San Jose, CA 95129
Tel: 408-217-8749 •E-Fax: 408-872-4159
info@cnallp.com •www.cnallp.com
INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL
REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE
WITH GOVERNMENT AUDITING STANDARDS
To the Board of Directors
of the Midpeninsula Regional Open Space District
Los Altos,California
We have audited, 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, the financial statements of the
governmental activities and each major fund of Midpeninsula Regional Open Space District (the
District)as of and for the year ended June 30, 2019,and the related notes to the financial statements,
which collectively comprise the District’s basic financial statements, and have issued our report
thereon dated November 11, 2019.
Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the District’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 District’s
internal control.Accordingly, we do not express an opinion on the effectiveness of the District’s
internal control.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees in the normal course of performing their assigned functions, to prevent, or
detect and correct misstatements on a timely basis.A material weakness is a deficiency, or a
combination of deficiencies, in internal control, such that there is a reasonable possibility that a
material misstatement of the District’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 over financial reporting was for the limited purpose described in
the first paragraph of this section and was not designed to identify all deficiencies in internal control
over financial reporting that might be material weaknesses or significant deficiencies.Given these
limitations, during our audit we did not identify any deficiencies in internal control over financial
reporting that we consider to be material weaknesses. However, material weaknesses may exist that
have not been identified.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the District’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
108
CHAVAN &ASSOCIATES,LLP
CERTIFIED PUBLIC ACCOUNTANTS
1475 Saratoga Ave, Suite 180, San Jose, CA 95129
Tel: 408-217-8749 •E-Fax: 408-872-4159
info@cnallp.com •www.cnallp.com
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.
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
District’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 District’s internal control and
compliance. Accordingly, this communication is not suitable for any other purpose.
November 11, 2019
San Jose, California
109
Midpeninsula Regional Open Space District
330 Distel Circle
Los Altos, California 94022-1404
650-691-1200
info@openspace.org
openspace.org
PRINTED ON POST
CONSUMER WASTE PAPER
Russian Ridge Open Space Preserve by Jim Mosher
Photos on front cover:
Top photo: Purisima Creek Redwoods Open Space Preserve by Maila Pinlacperez
Second row, left to right: Russian Ridge Open Space Preserve by Rosalina Calderon;
Rancho San Antonio Open Space Preserve by Selwyn Quan;
Russian Ridge Open Space Preserve by Karl Kohl