HomeMy Public PortalAbout13) 7D Audit Report for Prop A, Prop C, Measure R, and Transportation Develop Act Article 3 FY 12-14City Council
February 17 , 2015
Page 2 of 3
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4. Effective November 4 , 2008 , Measure R, approved by the electorate , increased the
County Sales Tax by one-half cent to provide for public transportation projects .
Fifteen percent of these funds are allocated to municipalities based on a per capita
basis . Cities have the year of receipt plus three additional years to expend the
funds .
5. On June 23 , 2011 , the Los Angeles County Metropolitan Transportation Authority
Board authorized an amendment to the agreement by replacing the capital reseNe
authorization of $5 ,000 ,000 in Proposition C funds with $1 ,500 ,000 Proposition A
and $7,000 ,000 Proposition C funds for a total of $8 ,500 ,000 in capital reseNe . In
addition , the term of the reseNe account was extended from June 30 , 2011 to
June 30 , 2014 .
6 . In October 2014, the firm of Vasquez & Company LLP conducted field work for the
annual audits of Proposition A , Proposition C , Measure R and Transportation
Development Act Article 3 . A separate audit of the City of Temple City 's
Proposition A , Proposition C, Measure R and Transportation Funds is required on
an annual basis by an independent audit fi rm (Vasquez & Company) contracted
and hired by the Los Angeles County Metropolitan Transportation Authority .
7 . On February 3 , 2015 , the City received the final audit from Vasquez & Company .
ANALYSIS:
There are two non-compliance items that the auditor mentioned : the accounting
procedures and record keep i ng of timecards for salaries and benefits charged to
Proposition A and grant retroactive approval from MTA for Measure R. The City has
revised its current procedures to resolve these issues . The following reports are
presented for your review.
Proposition A
During the FY 2013-14 , the City received a total of $738 ,986 in revenues for Proposition
A funds which includes bus pass sales revenue of $126 ,990 and interest on income of
$1 ,826 . The total expenditures for FY 2013-14 were $2,167 ,643. The City of Temple
City utilized Proposition A funds for the following items:
• Special SeNice Paratransit ;
• Recreation Transit;
• Bus Shelter Maintenance ;
• Bus Pass Subsidy;
• Portion of San Gabriel Valley Council of Governments Membership (60 %);
• Direct Administration ; and
• Rosemead Boulevard Improvement Project.
City Council
February 17 , 2015
Page 3 of 3
Proposition C
During the FY 2013-14 , the City received $504 ,927 revenues for Proposition C which
also includes interest income of $36 . The expenditure for Proposition C was $789 ,651,
for the Rosemead Boulevard Improvement Proje ct and $88 ,548 for the Las Tunas Drive
Improvement Project in FY 2013-14 .
MeasureR
During the FY 2013-14 , the City received a total of $378 ,491 in revenues for Measure R
funds which also includes interest income of $777. The expenditure of $799 ,456
represents Measure R's portion of the funding of the Rosemead Boulevard
Improvement Project.
Transportation Development Act Article 3
Transportation Development Act Article 3 provides for construction of pedestrian and
bicycle facilities including ADA wheelchair ramps . Transportation Development Act
Article 3 funds are placed on reserve in the Local Transportation Fund Account with the
County Auditor-Controller and are drawn down whenever the funds become eligible for
a specific project.
During the FY 2013-14, the City drew down $15 ,403 from the County Auditor-Controller
in Transportation Development Act Article 3 Funds with additional $88 ,682 to be drawn
down during FY 2014-15 to cover for the Ros emead Boulevard expensed in FY 2013-
14.
CONCLUSION:
Staff is recommending that the City Council rece ive and file the Proposition A ,
Proposition C , Measure R and Transportation Development A ct Article 3 Audit Reports
for the year ended June 30 , 2014 .
FISCAL IMPACT:
This agenda item does not have a fiscal impact on the FY 2014-15 City Budget.
ATTACHMENT:
A. Annual Financial Report of Proposition A , Proposition C, Measure R and
Transportation Development Act Article 3 Funds
FINANCIAL SECTION
ASSETS
Cash and investme nts
City of Temple Cit y
Proposition A Local Return Fund
Balance Sheets
June 30
2014 2013
$ 786 ,964 $ 2 ,228,232
Total assets $ 786 ,964 $ 2 ,228,232
LIABI LITI ES AND FUND BALANCE
Liabilities
Accounts payable $
Total liabilities
Fund balance
Restricted -Rosemead Boulevard Improvement Project
Restricted
Tota l fund b a lance
Tota l liab i l ities and fund bal a nce $
See notes to fi nancial statements.
3
63 ,358 $ 75 ,969
63 ,358 75 ,969
1,504 ,503
7 23 ,606 647 ,760
723 ,606 2 ,152,263
786 ,964 $ 2 ,228 ,232
City of Temple City
Proposition A Local Return Fund
Statements of Revenues, Expenditures and Changes in Fund Balance
Revenues
Proposit io n A $
Proj ect generated reven ue
In vest men t income
Total revenues
Expenditures
V a r ious proj ects
Total expenditures
Def icie ncy of reve nu es over expe nd it ures
Fund ba lance at b e ginn ing of year
Fun d ba lan ce at e nd of year $
See notes to fin ancial statements.
4
Years ended June 30
2014 2013
610 ,170 $ 5 54 ,620
126,990 139 ,107
1,826 6 ,6 08
738,986 700 ,335
2 ,167,643 70 3 ,555
2 ,167,643 703,555
(1 ,428 ,657) (3 ,220)
2,152 ,263 2,155,483
723,606 $ 2 ,152 ,263
Proje ct
Code
11 0-01
130-01
14 0-02
170-04
250-03
270-02
380-1 1
480 -05
City of Temple City
Proposition A Local Return Fund
Supplemental Information
Schedule of Expenditures -Actual and LACMT A Approved Project Budget
Year ended June 30 , 2014
Actual for 2013
2014
LACMTA
Proje c t Name Budget Actual
Fixed Route Shutt le $ 100,000 $ -
Special Service Pa ratransit 375 ,000 363,151
Recrea tiona l Transit 40 ,000 35,421
Bus Shelter Ma intena nce 8,950 7 ,752
User-S ide Subs id y 175 ,800 163,341
San Gabriel Va ll ey Council of Governments
Membe rs hip 9,500 9,471
Rosemead Bo ul evard Improvement Project 1,500,000 1,505 ,723
Direct Admi nistrat ion 83,625 82 ,784 •
Tota l exp e nditures $ 2,292,875 $ 2,167,643
• See Compl ia nce Matrix.
See report of indep endent auditors.
5
Variance
Pos itive 2013
(N e gative) Ac t u al
$ 100,000 $ 36,421
11,84 9 344 ,314
4 ,579 41 ,454
1,198 7 ,752
12,459 172,485
29 9 ,435
(5,723)
84 1 91,694
$ 125 ,232 $ 703 ,555
B al ance
Dat e July 1,
City of Temple City
Propositi on A Local Return Fund
Supplemental Information
Schedule of Capital Assets
Year ended June 30 , 2014
Ba la n ce
June 30,
Acqu i re d Descr i p tion 2013 Additions De letions 2014
08 /05/08 Form E350 Van $ 25 ,799 $
To t a l $ 25 ,799 $
See report of in dependent auditors.
6
-$ - $ 25,799
-$ - $ 25 ,79 9
ASSETS
Cash and investme nts
City of Temple City
Proposition C Local Return Fund
Balance Sheets
June 30
2014 2013
$ ________ -_$ ____ ~36~·~87~5~
Total assets $ -$ 36 ,875 ===========
LIABILITIES AND FUND BALANCE
Liabilities
D ue to General Fund
Total liabilities
Fund balance
Restricted-Rosemead Boulevard Imp rovement Project
Unassigned
Total fund balance
$ 336,397 $. ________ _
336 ,397
70 ,342
(336,397) (33,467)
(336,397) 36 ,875
Total liabilities and fund balance $ =====-= $==~3;,;;6;.k,8;;,;7,;;5~
See notes to fin anc ial statements.
7
Project
Code
270-01
380-11
City of Temple City
Proposition C Local Return Fund
Supplemental Information
Schedule of Expenditures -Actual and LACMTA Approved Project Budget
Year ended June 30 , 2014
Actual for 2013
2014
LACMTA
Project Name Budge t Actual
Las Tunas Drive Improvement Project $ 1,200 ,000 $ 88 ,548
Rosemead Boulevard Improvemen t Pr oject 5 ,387,210 789,651
Total ex p enditures $ 6 ,587 ,210 $ 878,199
See report of independent auditors.
9
Variance
Po s itive 2013
(Negative) Actual
$ 1 '111 ,452 $ 494,668
4,597,559 4 ,034 ,935
$ 5 ,709 ,011 $ 4 ,529 ,603
Date
Acquired
None
Description
B alance
July 1,
2013
City of Temple City
Proposition C Local Return Fund
Supplemental Information
Schedule of Capital Assets
Year ended June 30, 2014
Additions Deletions
Balance
June 30,
2014
$ _______ -_$ _______ -_$ _______ -_$ ______ __
Total $ -$===-=$====-=$====
See report of independent auditors.
10
ASSETS
Cash and investments $
Total assets $
City of Temple City
Measure R Local Return Fund
Balance Sheets
June 30
2014 2013
521 ,261 $ _ __;;9~42::::.!•::..:22~6:_
521 ,261 $ =~9~42;;:,!•,;;;22;;;6~
LIABILITIES AND FUND BALANCE
Liabilities
Accounts payable
Fund balance
Re stricted
$ _______ -_$ _______ _
Total liabilities
Total fund balance
Total liabilities and fund balance $
See no tes to financia l statements .
11
521 ,261 942 ,226
521,261 942 ,226
521 ,261 $ =~9,;,;42~·;;;22;;;6~
City of Temple City
MeasureR Local Return Fund
Statements of Revenues , Expenditures and Changes in Fund Balance
Revenues
Me asure R $
In vestment i ncome
Total revenues
Expenditures
Va rious proj ect s
Total expenditures
Excess (deficiency) of revenues o ver expe nd it u re s
F und balan ce a t b eg inn ing of year
Fu nd ba lan ce at e n d of year $
See notes to fin a nc ial statements .
12
Years ended June 30
2014 2013
377 ,714 $ 34 4 ,618
777 2 ,323
378 ,491 34 6 ,941
799,456 26,466
799 ,456 26,466
(420,965) 320 ,475
9 4 2 ,226 621,751
521 ,261 $ 94 2 ,226
City of Temple City
Measure R Local Return Fund
Supplemental Information
Schedule of Expenditures -Actual and LACMTA Approved Project Budget
Year ended June 30 , 2014
Actual for 2013
2014
Project LACMTA
Code Proje ct Name Budget Actu al
01 -001 Rosemead Boulevard Improvement Project $ -$ 799,4 56
02-002 Citywide Traffic Ca lming Study and Master Plan
02-003 Comprehensive Downtown Parking Study and
Strategic Plan
-$ Total expenditu r es S ____ _ 799,456
• See Complia nce Matrix
See report of independent auditors.
13
Variance 2013
Po s itiv e Actual
(Negative)
• $ (799,45 6) $
10,320
16 ,146
s F991456l s 26,466
Date
Acquired
None
Description
Balance
July 1,
2013
City of Temple City
Measure R Local Return Fund
Supplemental Information
Schedule of Capital Assets
Year ended June 30 , 2014
Additions Deletions
Balance
June 30 ,
2014
$ ________ -_$ _______ -_$ _______ -_$ ________ _
Total $========-=$=======-=$=======-=$=========
See report of independent auditors.
14
ASSETS
Du e from LAC MT A
City of Temple City
Transportation Development Act Article 3 Fund
Balance Sheets
Pursuant to Public Utilities Code Section 99234
June 30
2014 201 3
$ ____ ~15~4~0~3_$ ______ 6~·~85~4~
Total assets$ 15,403 $ 6 ,85 4 ======~== ==~--~==
LIABILITIES AND FUND BALANCE
Liabilities
Due to General F und
Fund balance
Unassigned
$ 104,085 $ _____ 7__,,...;_00.;__4_
Total liabi l ities 104,085 7 ,004
(88 ,682) (150)
Total fund balance (88 ,682) (150)
Total liabilities and fund balance $ ===1;,;;5:!,4;,;0;,;;3=$ ===~6::!:,8~5;,4~
See notes to fin ancial sta tements.
15
City of Temple City
Transportation Development Act Article 3 Fund
Statements of Revenues , Expenditures and Changes in Fund Balance
Pursuant to Public Utilities Code Section 99234
Revenues
Inte rg ove rnm e ntal Allo c atio ns:
Article 3 $
Interest in come
Total revenues
Expenditures
Construction/Main tena nce
Total expenditures
De ficiency of reve nu es over expenditures
(Unassigned) fund bal ance at beginning of year
Un assigne d fund balan ce at end of yea r $
See notes to fin anc ial sta tements.
16
Years ended June 30
2014 20 13
15,403 $ 6 ,853
5
15 ,403 6 ,858
103,935 7,095
103,935 7,095
(88,532) (237)
(150) 87
{88,682) $ {150)
City of Temple City
Transportation Development Act Article 3 Fund
Supplemental Information
Schedule of Transportation Development Act Allocation for Specific Projects
Pursuant to Public Utilities Code Section 99234
Year ended June 30, 2014
Totals to Date
Prog ra m
Project Description Year Allocations Expend itu res
Local Allocations:
Ro semead Boulevard Safety Enhancement 2014 $ 15,403 $ 103,935
Totals $ 15,403 $ 103,935
Unexpended interest accumulated to date
Un assigned fund ba lance at beginn in g of year
Unassign ed fund balance at e nd of year
See report of independent auditors.
17
Unexpended Project
Allocations Status
$ (88,532) Ongoing
(88,532)
(150 )
$ (88,682)
NOTE 1
NOTE 2
City of Temple City
Notes to Funds Financial Statements
Years ended June 30, 2014 and 2013
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Fund Accounting
The operations of th e Proposi tio n A Local Return Fun d (PALRF), Propo sition C
Lo ca l Return Fund (PCLRF ), Measure R Loca l Return Fund (MRLRF) and
Transportati on Developme nt Act Article 3 Fund (T DAA3 F) (co ll ective ly, the Fun ds)
are acco unted f or in sepa rate se ts of sel f-bala ncing accou nts that comprise thei r
assets , liabil it ies, fu nd balance, revenues and expe nd itu res .
PALRF and PCLRF represent 25% and 2 0%, re spectively , of the ~ cen t
Propo sit ion A and ~ cent Proposi t ion C sa les taxes which are distributed to the
jurisdicti ons within Los Ang eles County based on popu lation and must be used
excl usiv ely fo r transportation re lated programs and proje cts.
MRLRF is derived from 15% of a county-wide ~ cen t sales tax w hi ch is distributed
to th e jurisdi ctio ns wi thin Los Angeles Co unty based on a per cap ita basis and
must be used exclus ively for t ransporta t ion p urpo ses.
Transportation Development Act Article 3 Fund (TDAA3F ) is poo led wi th oth er City
mon ies in th e Special Reven ue Fu nd . T he Specia l Reve nu e Fund accounts for the
City 's s hare of the Transpo rtati on Deve lopment Act Article 3 all oca ti ons which are
lega ll y restr icted fo r specific pu r poses .
Basis of Accounting
PA L RF, PC LRF , MRLRF and the TDAA3 F are accounted for using the modified
accrual basis of acco unt ing whereby reven ues are recognized whe n th ey become
both measu rab le and ava il ab le to fin ance expe nditures of the c urrent period and
expendit ures are gene rall y recognized when th e related fund liabi liti es are incurred .
Budgets and Budgetary Accounting
Th e bud geted amounts presented in this repo rt for compar ison to th e actual
amo unts are presented in accordan ce wi th accoun ting principles gene rally
accep ted in the United Sta tes of America .
Unrealized Gain (Loss)
In accordance wit h GAS B Statement No. 31 , Accounting and Financial Reporting
for Certain Investments and Ex ternal Investment Pools , local governments a re
required to use fa ir va lu e (i nstead of amortized costs ) fo r fin ancia l reporti ng
pu rposes. As a resu lt of suc h implementation, the City recognizes the unrealized
gai n (loss).
ANNUAL FINANCIAL STATEMENTS
The finan cial stateme nts refl ect only the fi nancial position and res ults of operatio ns
of the PA LR F, PCLRF, MRLRF an d TD AA3 F, and do not purport to , and do not,
present fairly t he City 's financial position as of Jun e 30 , 20 14 and 201 3, and the
cha nges in its fin anc ial posi t ion for the years th en ended in accorda nce wi th
accounting princi ples ge nerally accepted in the Un ited States of Ame r ica .
18
NOTE 3
NOTE4
NOTE 5
NOTES
City of Temple C ity
Notes to Funds F i nancial Statements
Years ended June 30, 2014 and 2013
PROPOSITION A AND PROPOSITION C LOCAL RETURN COMPLIANCE
REQUIREMENTS
The Proposition A Ordina nce requires that Loca l Return (L R) funds be used
exclusively to benefit public transit. Expend itu res related to fixed route and
para transit services, Transportation Demand Management, Transportation
System s Management and fare subsidy programs that exclusively benefit transit
are a ll eligible uses of Proposition A LR funds . Proposition A LR funds may also be
traded to other Jurisdictions in exchange for general or other funds .
The Proposition C Ordinance directs that LR funds also be used to benefit public
tra n si t , as described above , bu t provides a n expa nded list o f e ligible project
expenditures inclu ding , Congestion Management Programs, bikeways and bike
lanes, street improvement s supporting pub lic transit service , and
Pavement Management System projects. Proposition C LR fun d s cannot be
traded .
In accordance with Proposition A and Proposition C Local Return Program
Guidelines , funds received pursuant to these gu idelines may o nl y be used for
Propos ition A and Pro position C Local Return approved programs. See
accom pa nying Com pliance Matrix.
MEASURE R LOCAL RETURN COMPLIANCE REQUIREMENTS
T he M ea sure R Ordinance specifies that LR funds are to be used for transportation
purposes .
In accordance with Measure R Lo cal Return Program Guidelines, funds received
pursua nt to these guidelines may only be used for Measure R Local Return
approved programs . See accompanying Compliance Matrix.
TRANSPORTATION DEVELOPMENT ACT COMPLIANCE REQUIREMENTS
In accord ance with Public Utilities Code Section 99234 , funds received pursuant to
this Code's section may o nly be used for activities re lati ng to pedestrians and
bicycle facilities.
CASH AND INVESTMENTS
The PA LRF , PC LRF , MRLR F and T DAA3F ca sh a nd investment balances were
pooled wi th var ious o the r Ci ty fund s for de posit and invest men t purposes . T he
sh are of each fund in t he poo led cash account was separa te ly main tained and
i nterest i ncome wa s ap portioned to the participating funds based on the
relat io nsh ip of their average mon th ly balances to t he total of the poo led cash and
investments.
Please refer to the City 's Comprehensive Annu a l Financial Report (CAFR) for a full
description of risks relati ng to cash and i nvestments.
19
NOTE7
NOTES
NOTE9
City of Temple City
Notes to Funds Financial Statements
Years ended June 30, 2014 and 2013
PROJECT GENERATED REVENUE
PALRF 's project generated revenue for the years ended June 30 , 2014 and 2013
represents bus pass sales amounting to $126,990 and $139,107, respectively .
CAPITAL RESERVE
On July 1, 2006 , LACMTA and the City entered into capita l reserve agreements to
establish a capital reserve account amounting to $5,000 ,000 for the Rosemead
Boulevard Street Improvements Project (Project).
The Project will be funded with the Proposi tion C Loca l Return funds allocated to
the City. A ll interest shall be accrued and placed in the Account for use exclusively
for the said projects. On June 23 , 2011 , the LACMTA Board authorized an
amendment to the agreeme nt by replacing the capital reserve authorization of
$5,000,000 in Proposi tion C fund s with $1,500,000 Propositio n A and $7 ,000 ,000
Proposition C funds for a total of $8 ,500 ,000 in capital reserve . In addition , the term
of the reserve ac cou nt was extended to June 30 , 2014 .
For the year ended June 30 , 2014 and 20 13, followi ng is the capita l reserve
amount for PCLRF :
PALRF
Capita l reserve at June 30, 2012 $ 1,50 0 ,0 00 $
Interest in come earned 4,503
Capital expenses during the year
Capital reserve at June 30 , 2013 1,504 ,503
Interest income earned 1,220
Capital expenses during the year (1,505 ,723)
PCLRF
4,092 ,990
12 ,287
4 ,034 ,935
70 ,342
(70 ,342)
Cap ital re serve at June 30, 2014 $ --------$ ------
TRANSPORTATION DEVELOPMENT ACT FUND REVENUE ALLOCATION
Th e revenue allocation for the years ended June 30 , 2014 and 2013 consisted of
the following :
FY 2008/09 reserve
FY 2009/1 0 reserve
$
$
20
2014 2013
-$ 6 ,853
15,403
15,403 $ 6 ,853
NOTE 10
NOTE 11
City of Temple City
Notes to Funds Financial Statements
Years ended June 30, 2014 and 2013
TRANSPORTATION DEVELOPMENT ACT FUNDS RESERVED
In accordance with TDA Article 3 (SB821) Guidelin es, funds which will not be spent
during the fiscal year have been placed on reserve i n the Local Transportation
Fund (L TF ) account with the County Auditor-Con troll er to be drawn down whenever
the funds become eligi ble for a specific project and an approved drawdown request
is received by LACMTA. As of June 30 , 2014 and 2013 , the City has funds on
reserve as follows:
FY 2009/1 0 reserve
FY 20 10/11 reserve
FY 2011/12 reserve
FY 2012/13 reserve
FY 2013/14 allocation
Avai lab le reserve balance
$
$
2014
-$
14,391
17,306
25,547
29,140
2013
15,403
14,391
17,306
25,547
86 ,384 $ ____ 7_2:....,6_47_
For FY 2013/14 , any TDA Article 3 fun ds left on reserve for FY 2009/10 or prior,
are subject to lapse if not c laimed by the City by June 30 , 2014. There were no
funds that lapsed in FY 2013/14 .
SUBSEQUENT EVENTS
The City has evaluated subsequent events through December 10 , 2014 , the date
the financial statements were avai lable to be issued , and concluded that no events
have occurred th at require disclosu re in or adj ustments to the financia l statements.
21
COMPLIANCE SECTION
" ~ V a s o u e z
J ( 4 1 & C o m P a n Y L L P
C ~ m t ~ P u A < " ' T I < - " a " � 5 a n d 6 . J S < . , e s s C o n " . u ~ r . . s
R e p o r t o f I n d e p e n d e n t A u d i t o r s o n C o m p l i a n c e
T o t h e H o n o r a b l e M e m b e r s o f t h e C i t y C o u n c i l o f t h e
C i t y o f T e m p l e C i t y , C a l i f o r n i a a n d t h e
L o s A n g e l e s C o u n t y M e t r o p o l i t a n T r a n s p o r t a t i o n A u t h o r i t y
R e p o r t o n C o m p l i a n c e
8 0 1 S o u t h G r a n d A . . - , S u r t e 4 0 0
l o s A n p t u , C A ! 1 0 0 1 7
P h . ( 2 1 3 ) 8 7 3 - 1 7 0 0
f u ( 2 1 3 ) 8 7 3 - 1 7 7 7
w w v l . v a s q u e _ t c p A . c o m
O F F I C E l O C A T I O N S :
l o s A n c e l u
S a c ~ m " n t o
W e h a v e a u d i t e d t h e c o m p l i a n c e o f t h e C i t y o f T e m p l e C i t y , C a l i f o r n i a ( t h e C i t y ) w i t h t h e P r o p o s i t i o n
A a n d P r o p o s i t i o n C L o c a l R e t u r n G u i d e l i n e s , M e a s u r e R L o c a l R e t u r n G u i d e l i n e s , T r a n s p o r t a t i o n
D e v e l o p m e n t A c t A r t i c l e 3 , a n d t h e L o s A n g e l e s C o u n t y M e t r o p o l i t a n T r a n s p o r t a t i o n A u t h o r i t y ' s
F u n d i n g a n d A l l o c a t i o n G u i d e l i n e s f o r T r a n s p o r t a t i o n D e v e l o p m e n t A c t A r t i c l e 3 B i c y c l e a n d
P e d e s t r i a n F u n d s ( c o l l e c t i v e l y , t h e G u i d e l i n e s ) f o r t h e y e a r e n d e d J u n e 3 0 , 2 0 1 4 .
M a n a g e m e n t ' s R e s p o n s i b i l i t y
M a n a g e m e n t i s r e s p o n s i b l e f o r t h e C i t y ' s c o m p l i a n c e w i t h t h e G u i d e l i n e s .
A u d i t o r s ' R e s p o n s i b i l i t y
O u r r e s p o n s i b i l i t y i s t o e x p r e s s a n o p 1 m o n o n t h e C i t y ' s c o m p l i a n c e b a s e d o n o u r a u d i t . W e
c o n d u c t e d o u r a u d i t o f c o m p l i a n c e 1 n a c c o r d a n c e w i t h t h e a u d i t i n g s t a n d a r d s g e n e r a l l y a c c e p t e d i n
t h e U n i t e d S t a t e s o f A m e r i c a ; t h e s t a n d a r d s a p p l i c a b l e t o f i n a n c i a l a u d i t s c o n t a i n e d i n G o v e r n m e n t
A u d i t i n g S t a n d a r d s i s s u e d b y t h e C o m p t r o l l e r G e n e r a l o f t h e U n i t e d S t a t e s ; a n d t h e G u i d e l i n e s .
T h o s e s t a n d a r d s a n d t h e G u i d e l i n e s r e q u i r e t h a t w e p l a n a n d p e r f o r m t h e a u d i t t o o b t a i n r e a s o n a b l e
a s s u r a n c e a b o u t w h e t h e r n o n c o m p l i a n c e w i t h t h e c o m p l i a n c e r e q u i r e m e n t s r e f e r r e d t o a b o v e t h a t
c o u l d h a v e a d i r e c t a n d m a t e r i a l e f f e c t o n t h e P r o p o s i t i o n A L o c a l R e t u r n P r o g r a m , P r o p o s i t i o n C
L o c a l R e t u r n P r o g r a m , M e a s u r e R L o c a l R e t u r n P r o g r a m , a n d T r a n s p o r t a t i o n D e v e l o p m e n t A c t
A r t i c l e 3 P r o g r a m o c c u r r e d . A n a u d i t i n c l u d e s e x a m i n i n g , o n a t e s t b a s i s , e v i d e n c e a b o u t t h e C i t y ' s
c o m p l i a n c e w i t h t h o s e r e q u i r e m e n t s a n d p e r f o r m i n g s u c h o t h e r p r o c e d u r e s a s w e c o n s i d e r e d
n e c e s s a r y i n t h e c i r c u m s t a n c e s .
W e b e l i e v e t h a t o u r a u d i t p r o v i d e s a r e a s o n a b l e b a s i s f o r o u r o p i n i o n o n c o m p l i a n c e w i t h t h e
G u i d e l i n e s . H o w e v e r , o u r a u d i t d o e s n o t p r o v i d e a l e g a l d e t e r m i n a t i o n o f t h e C i t y ' s c o m p l i a n c e w i t h
t h e G u i d e l i n e s .
O p i n i o n
I n o u r o p i n i o n , t h e C i t y o f T e m p l e C i t y , C a l i f o r n i a c o m p l i e d , i n a l l m a t e r i a l r e s p e c t s , w i t h t h e
c o m p l i a n c e r e q u i r e m e n t s o f t h e G u i d e l i n e s f o r t h e y e a r e n d e d J u n e 3 0 , 2 0 1 4 .
O t h e r M a t t e r s
T h e r e s u l t s o f o u r a u d i t i n g p r o c e d u r e s d i s c l o s e d i n s t a n c e s o f n o n c o m p l i a n c e w i t h t h e r e q u i r e m e n t s ,
w h i c h a r e d e s c r i b e d i n t h e a c c o m p a n y i n g C o m p l i a n c e M a t r i x . O u r o p i n i o n i s n o t m o d i f i e d w i t h
r e s p e c t t o t h e s e m a t t e r s .
In
Compliance Requirements Comp l iance
Yes No
A. Proposition A and Proposition C Local
Return F unds
1. Timely use of fund s X
2. Expenditures approved before
being inc urred . X
3. Expe nd itu res did not excee d
25% of LACM T A's approved
budget. X
4 . Administrative expenses a re
w ithin the 20% cap. X
5. All on-going and carryover
projects we re reported in Form
B . X
6 . Annual Project Summary Report
(Form B) was submitted on time . X
7 . Annual Ex pend iture Report
(Form C) was subm itted on time. X
8. Cash or cash equivale nts are
maintained . X
9. Accou nting procedures, record
keeping a nd doc umentation are
adequate. X
26
--------------------------
Questio ned
Costs
None
None
No ne
None
None
None
None
None
$81 ,577
C ity of Templ e City
Compli a nce Matr ix
Year e nd ed J une 30 , 2014
If no, pr ovide details and
management response.
Finding #14-01
PA LRF
The salaries and benefits
totaling $81 ,577 under
Project 4 80-05 , Direct
Administration, was based
on percentages determined
by th e City departments to
be attributable to the
LACMTA project. However,
the perce ntages util ized
can not be supported by
timesheets or si m ila r time
and effort docu m entation to
demonstrate that the
salaries ch arged we re
expended on approved
Proposition A Local Return
p roject.
We recommend that the
City revise its current labor
reporting procedures to
ensure that la bor costs
charged to LACMTA
proj ects are adequately
supported by timesheets or
similar docume ntation .
In
Compliance Requirements Compliance
Yes No
A. Propos ition A and Proposition C Loca l
Return Funds (Continued)
9 . Accounting procedures , re cord
keeping and documentation are
adequate. (C ontinued)
B. Measure R Local Return Fund
1. Funds were expended for
transportation purposes . X
2 . Funds were used to augment, not
supplant existing local re venu es
being used for transportation
purposes unless there is a
funding shortfall. X
3 . Sig ne d Assurances and
Understandings on fil e . X
4 . Separate Measure R Local Return
Account was established. X
5 . Revenues received including
allocations, projec t generated
revenues and interest income was
properly credited to the Measu re
R Local Return Account. X
27
Questioned
Costs
None
None
None
None
None
City of Temple City
Compliance Matrix
Year ended June 30 , 2014
If no, provide details and
management response.
Management Resp ons e
The City has revised its
current labor reporting
procedures to ensure that
labor costs charged to
LACMTA projects are
adeq uately supported by
time sheet s .
Co m p liance Require me nts
B. Measu re R Loca l Return Fun d
(C onti nue d)
6 . Funds were expended with
LACMT A 's approval.
In
Com JJii a n ce
Yes No
X
28
City of Temple City
Compliance Matrix
Year ended June 30 , 20 14
Questioned If no, p rovide d et ails and
C osts ma n ag eme n t respo nse.
$799,456
Finding # 14-02
The City
expenditures
Rosemead
claimed
for the
Boulevard
project
with no
from
Improvement
totaling $799,456
prior approval
LACMTA.
Although, t his project was
previously approved in F Y
2013 , the City is still
required to subm it the
Form One f or FY 2014 and
carry over the budget and
have it approved prior to
spending the money.
LACM T A Program
Manager granted a
retroactive approval of the
said project on July 3 ,
2014 .
We recommend for the City
to obtain approval from
LACMTA prior to
implementing any Measure
R-funded project.
Management Response
The City w ill obtain
approval from LACMTA
prior to im p lementing any
Measure R funded projects
as part of the annual
budget process .
In Question ed Comp l iance Requireme nts Compliance
Yes No Costs
B. MeasureR Local Return Fund
(Conti nu ed)
7. Expenditure Plan (Form One)
was subm itted on time . X None
8 . Expenditure Report (Form Two)
was submitted on ti m e. X None
9. T imely use of fund s . X None
10. Administrative expenses are
with in the 20% cap. X None
11 . Fund excha nge s were approved
by LACMTA.
12. A separate account was
established for Capital reserve
funds and Capital rese rve was
approved b y LACMT A.
13. Recreational tran sit form was
submitted tim ely.
c. Transportation Developm ent Act
Article 3 Fund
1. Timely use of fund s . X None
2. Expenditures w ere in curred fo r
activities relat in g to pedestrian
and bicycle facilities and
amenities. X None
29
City of Temple City
Compliance Matrix
Year ended June 30 , 2014
If no, provide details and
managem ent response.
Finding # 14-03
The City submitted its
Ex penditure Plan (Form
One) on July 3, 2014 ,
which is beyond the due
date of A ugust 1, 2013 set
under the Guidelines.
We recommend f or the City
to establish proce dures
and cont rol s to ensure that
the Expenditure Plan (Form
One) is subm itted by
August 1 as required by the
Guideline s.
Management Response
The City has establish ed
procedures and contro ls as
part of the year end closing
process to ensu re that
Expenditure Plan (Form
One) is subm itted by
August 1 as requ ired by the
Guidelines .
Not applicable .
Not applicable .
Not applicable .
EXIT CONFERENCE
City of Temple City
Exit Conference
Year ended June 30, 2014
An exit conference was held on De cember 10,2014 w ith C ity of Temple City representatives . Those
in attendance were:
Vasquez and Company LLP representative :
Marialyn Salvador-Audi t Manager
City of Temple City representatives :
Tracey Hause-Administrative Serv ice Di rector
Lee Ma-Accounta nt
Matters discussed :
Results of the audit disclosed issues of noncompl iance with the Guidel ines.
A copy of th is report was forwarded to the following City of Temple City representatives for
comments prior to the issuan ce of the final report :
Tracey Hau se-Admin istrative Service Director
Lee Ma -Accountant
30
Vasquez & Company LLP
80 1 S. Gra nd Av enue , Suite 400
Los Angeles , CA 90017
RE : CITY OF TEMPLE CITY , CA LIFORNI A A NNUAL FINANCIAL REPORT OF THE
PROPOSITION A LOCAL RETUR N FUND , PROPOSITION C LOCAL RETURN FUND ,
MEASURE R LO CAL RETURN FUND A ND TRANSPORTATION DEVELOPMENT AC T
ARTICLE 3 FUND FOR THE YEARS ENDED JUNE 30 , 2014 AND 2013
I have received the annual financial repo rt of the Proposition A Local Return Fund , Proposition C
Lo ca l Return Fund, Measure R Local Return Fund and Transportati on Develo pment Act Article 3
Fund , for the yea rs end ed June 30 , 20 14 and 2013 for t he City of Temple City and agreed with the
co ntents of th e report except as ind icated below:
(A ttach additional pages if necessary)
Very truly yours ,
Name
Titl e
Da te