HomeMy WebLinkAboutCity of Azusa Comprehensive AFR 2020 Final 4-21-21_202104261307016706CITY OF AZUSA
CALIFORNIA
Comprehensive Annual Financial Report
For the Fiscal Year Ended June 30, 2020
CITY OF AZUSA, CALIFORNIA
Comprehensive Annual Financial Report
For the Fiscal Year Ended June 30, 2020
Prepared by:
Finance Department
City of Azusa
Comprehensive Annual Financial Report
For the year ended June 30, 2020
Table of Contents
Page
INTRODUCTORY SECTION
Transmittal Letter ..................................................................................................................................................... i
Directory of City Officials ........................................................................................................................................ ix
Organization Chart ................................................................................................................................................... x
GFOA Certificate of Excellence in Financial Reporting ...................................................................................... xi
FINANCIAL SECTION
Independent Auditors’ Report .............................................................................................................................. 1
Management’s Discussion and Analysis ............................................................................................................. 5
Basic Financial Statements:
Government-Wide Financial Statements:
Statement of Net Position ........................................................................................................................... 23
Statement of Activities ................................................................................................................................ 24
Fund Financial Statements:
Governmental Fund Financial Statements:
Balance Sheet .......................................................................................................................................... 30
Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position ................................................................. 31
Statement of Revenues, Expenditures and Changes in Fund Balances ......................................... 32
Reconciliation of the Governmental Funds Statement of Revenues,
Expenditures, and Changes in Fund Balances to the Government-Wide
Statement of Activities ................................................................................................................... 33
Proprietary Fund Financial Statements:
Statement of Net Position ..................................................................................................................... 37
Statement of Revenues, Expenses and Changes in Fund Net Position ......................................... 38
Statement of Cash Flows ...................................................................................................................... 39
Fiduciary Fund Financial Statements:
Statement of Fiduciary Net Position ................................................................................................... 41
Statement of Changes in Fiduciary Net Position .............................................................................. 42
Notes to Basic Financial Statements ................................................................................................................ 44
City of Azusa
Comprehensive Annual Financial Report
For the year ended June 30, 2020
Table of Contents, Continued
Page
FINANCIAL SECTION, Continued
Required Supplementary Information (Unaudited):
Schedule of Changes in the Net Pension Liability and Related Ratios –
CALPERS Agent Multiple-Employer Plan ............................................................................................... 108
Schedule of Contributions – CalPERS Agent Multiple-Employer Plan...................................................... 109
Schedule of Proportionate Share of the Net Pension Liability –
Cost Sharing Multiple-Employer Plan ..................................................................................................... 109
Schedule of Contributions – Cost Sharing Multiple-Employer Plan .......................................................... 110
Schedule of Changes in the Net Pension Liability and Related Ratios –
AMMA PARS Retirement Enhancement Plan ......................................................................................... 111
Schedule of Changes in the Net Pension Liability and Related Ratios –
Executive PARS Retirement Enhancement Plan ..................................................................................... 112
Schedule of Changes in the Net Pension Liability and Related Ratios –
IBEW PARS Retirement Enhancement Plan ............................................................................................ 113
Schedule of Changes in the Net Pension Liability and Related Ratios –
SEIU PARS Retirement Enhancement Plan ............................................................................................. 114
Schedule of Contribution – PARS Retirement Enhancement Plan .............................................................. 115
Schedule of Changes in the Total OPEB Liability and Related Ratios ........................................................ 116
Budgets and Budgetary Accounting ................................................................................................................ 117
Budgetary Comparison Schedule by Department – General Fund ............................................................ 118
Budgetary Comparison Schedule – Fire Special Revenue Fund ................................................................. 119
Supplementary Information:
Non-Major Governmental Funds:
Combining Balance Sheet ........................................................................................................................... 124
Combining Statement of Revenues, Expenditures and Changes in Fund Balances .......................... 128
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget and Actual:
Grant and Seizure Special Revenue Fund ......................................................................................... 132
State Gasoline Tax Special Revenue Fund ......................................................................................... 133
Proposition A Special Revenue Fund ................................................................................................. 134
Proposition C Special Revenue Fund ................................................................................................. 135
Community Development Block Grant Special Revenue Fund ..................................................... 136
Senior Nutrition Special Revenue Fund ............................................................................................. 137
Public Benefit Program Special Revenue Fund ................................................................................. 138
Air Quality Improvement Special Revenue Fund ............................................................................ 139
Supplemental Law Enforcement Special Revenue Fund ................................................................. 140
Monrovia Nursery Special Revenue Fund ........................................................................................ 141
City of Azusa
Comprehensive Annual Financial Report
For the year ended June 30, 2020
Table of Contents, Continued
Page
Supplementary Information (Continued):
Employee Benefits Special Revenue Fund ......................................................................................... 142
Utility Mitigation Special Revenue Fund ........................................................................................... 143
Highway 39 Special Revenue Fund .................................................................................................... 144
LACMTA Special Revenue Fund ........................................................................................................ 145
Measure R Special Revenue Fund ...................................................................................................... 146
AB 939 Special Revenue Fund ............................................................................................................. 147
Rosedale Traffic Mitigation Special Revenue Fund ......................................................................... 148
RMR SB1 Special Revenue Fund ......................................................................................................... 149
Measure M Special Revenue Fund...................................................................................................... 150
Park In-Lieu Capital Project Fund ...................................................................................................... 151
Capital Projects Capital Project Fund ................................................................................................. 152
Public Works Endowment Capital Project Fund .............................................................................. 153
Public Financing Authority Debt Service Fund ................................................................................ 154
Non-Major Enterprise Funds:
Combining Statement of Net Position ...................................................................................................... 156
Combining Statement of Revenues, Expenses and Changes in Net Position ..................................... 157
Combining Statement of Cash Flows ........................................................................................................ 158
Internal Service Funds:
Combining Statement of Net Position ...................................................................................................... 160
Combining Statement of Revenues, Expenses and Changes in Net Position ..................................... 162
Combining Statement of Cash Flows ........................................................................................................ 164
Fiduciary Funds:
Statement of Changes in Agency Funds Assets and Liabilities ............................................................ 166
Supplemental Statement of Revenues, Expenses and Changes in
Net Position – Water – Enterprise Fund .......................................................................................................... 167
Supplemental Statement of Revenues, Expenses and Changes in
Net Position – Light – Enterprise Fund ........................................................................................................... 168
City of Azusa
Comprehensive Annual Financial Report
For the year ended June 30, 2020
Table of Contents, Continued
Page
STATISTICAL SECTION (Unaudited)
Table 1 - Net Position by Component ............................................................................................................. 170
Table 2 - Changes in Net Position .................................................................................................................... 171
Table 3 - Fund Balances of Governmental Funds ........................................................................................... 173
Table 4 - Changes in Fund Balances of Governmental Funds ...................................................................... 174
Table 5 – Light Department, Electricity Sold by Type of Customer............................................................. 175
Table 6 – Electricity Rates ................................................................................................................................... 176
Table 7 – Largest Electricity Customers ........................................................................................................... 178
Table 8 – Water Sold by Type of Customer ..................................................................................................... 180
Table 9 – Water Rates .......................................................................................................................................... 181
Table 10 – Largest Water Customers ............................................................................................................... 182
Table 11 – Assessed Value and Estimated Actual Value of Taxable Property .......................................... 184
Table 12 – Direct and Overlapping Property Rates ....................................................................................... 185
Table 13 – Principal Property Tax Payers ....................................................................................................... 186
Table 14 – Property Tax Levies and Collections ............................................................................................ 187
Table 15 – Ratios of Outstanding Debt by Type ............................................................................................ 188
Table 16 – Ratio of General Bonded Debt Outstanding ................................................................................ 189
Table 17 – Direct and Overlapping Debt ......................................................................................................... 190
Table 18 – Legal Debt Margin Information ..................................................................................................... 191
Table 19 – Pledged Revenue Coverage ........................................................................................................... 192
Table 20 – Pledged Revenue Coverage, Tax Allocation
Bonds – Redevelopment Agency ............................................................................................................... 194
Table 21 – Demographic and Economic Statistics ......................................................................................... 195
Table 22 – Principal Employers ........................................................................................................................ 196
Table 23 – Full-time and Part-time Employees by Function ........................................................................ 197
Table 24 – Operating Indictors by Function ................................................................................................... 198
Table 25 – Capital Asset Statistics by Function .............................................................................................. 199
Table 29 – Schedule of Credits .......................................................................................................................... 200
April 21, 2021
Finance Department ▪ 213 E. Foothill Blvd. ▪ P.O. Box 1395 ▪ Azusa, CA 91702-1395
Tel: (626) 812-5203 ▪ FAX (626) 334-6358
ii
Management’s Discussion and Analysis (“MD&A”) immediately follows the Independent
Auditors’ Report and provides a narrative introduction, overview, and analysis of the basic
financial statements. MD&A complements this letter of transmittal and should be read in
conjunction with it.
PROFILE OF THE GOVERNMENT
The City was incorporated in 1898 as a general law city and operates as a Council/Manager form
of government. The four City Council members are elected at large for four-year terms with
elections staggered at two-year intervals. The Mayor is elected at-large for a two-year term. The
City Council appoints the City Manager to manage the City’s staff and implement the policies
established by the Council. The City is full-service except for its Fire Department which is
contracted with Los Angeles County Fire Department. The City owns and operates an electric
public utility for its citizens providing electric services to customers within the City limits. The
City also owns and operates a water system whose service territory includes the City and adjoining
portions of neighboring cities and unincorporated areas of Los Angeles County.
The City is strategically located off the 210 Freeway within a 30 minute drive to Pasadena, Orange
County, Inland Empire, and the Ontario International Airport. In addition to its convenient
freeway access, Azusa offers several major traffic corridors, including the renowned U.S. Route 66
(Foothill Boulevard) which runs east to west through the community. The California State Route
39 runs north to the newly designated San Gabriel Mountains National Monument and south to
the beach.
The City covers approximately 10 square miles and boasts a diverse population of over 50,000. The
estimated median household income has grown from over $57,000 to over $68,200 annually. Azusa
is proud of its mix of small businesses, support services, manufacturers, and large institutional
employers such as Azusa Pacific University. The City is home to two Metro Gold Line Light Rail
Stations as part of the Foothill Gold Line from Pasadena to Azusa. The stations are located in the
heart of downtown, Azusa Downtown Station, and adjacent to Azusa Pacific University and Citrus
College, APU/Citrus College Station.
HISTORY
The name Azusa can be traced to a native village that existed long before Spanish explorers arrived
in 1769. The City boomed in population after the arrival of the railroad and was known as the “El
Susa Rancho”. The discovery of gold in the San Gabriel Canyon increased the population base in
1854, and by 1860 over 2,000 inhabitants resided in the area. The U.S. government bought a portion
of the land from founder Henry Dalton for homesteading purposes. However, it was not until Los
Angeles banker, Jonathan D. Slauson acquired the prized orchard community of Azusa Rancho
that the foundation and eventual incorporation on December 29, 1898 took place.
Orange and lemon groves covered the land and gave way to homes and industry affording new
generations of families and entrepreneurs to pursue the American dream. Today, the City prides
itself on a vibrant industrial base and diverse neighborhoods. Industry within Azusa is diversified
with major employers encompassing the fields of education, aerospace industry, light
manufacturing, and retail services.
Finance Department ▪ 213 E. Foothill Blvd. ▪ P.O. Box 1395 ▪ Azusa, CA 91702-1395
Tel: (626) 812-5203 ▪ FAX (626) 334-6358
iii
LOCAL ECONOMIC CONDITIONS AND OUTLOOK
Azusa has a diverse local economy and is less dependent on single source or cyclical revenues than
most of the surrounding cities in the region, and thus, comparatively better insulated from major
economic downturn. Investment in Azusa’s downtown has continued revitalize the area in
accordance with the Transit Oriented Development (TOD) Specific Plan. Construction of the
Orchard project commenced in 2019, consisting of 163 residential units and 31,500 square feet of
retail space and is still under construction with an anticipated completion date of Fall 2022. Also in
the downtown, the City has entitled 127 residential units and an additional 12,000 square feet of
retail currently under plan check review.
In addition to the Downtown projects: Canyon Commerce Park, a master-planned industrial park
was completed and has leased six of the seven campus buildings totaling over 450,000 SF of space;
Gladstone Senior Villas housing project has been completed with 60 Single Family Dwellings units
(of which six are designated as affordable housing); 23 Single Family Dwellings and a new public
park is under entitlement phase in the City’s prominent Rosedale Community; Promenade at
Citrus, a City-owned property, approximately 8,200 SF is currently under long-term lease
negotiations with Los Angeles County Metropolitan Transportation Authority (LA Metro) - LA
Metro proposes to occupy the building for use as a system security and law enforcement office to
support the LA Metro Gold Line railway, functioning on a 24 hour, 7 day per week basis as a
dispatch and training center; and One Legacy, the world’s largest organ, eye and tissue recovery
organization is relocating their headquarters from LA to Azusa acquiring a 98,000 SF building and
plans to build a 50,000 SF a state-of-the-art transplant recovery and research center, a $60 million
investment in the City, and is currently under construction with a targeted move in date end of
2022.
Unemployment rate in Azusa declined from 4.5% in FY 2018-19 to 4.2% in FY 2019-20. Continued
development in Azusa is expected to improve the City’s unemployment rate and is also expected
to continue to generate sales and property tax revenues for the City in coming years.
Assessed valuation (“AV”) of citywide properties for FY 2019-20 increased by 7.8% and is
attributable to new homes sales in various housing developments, such as in Rosedale and other
smaller tracts in the southern areas of the City. An improving housing market is also a factor in
the higher AV. The AV in Azusa has risen for the eighth straight year after three years of decline.
Future AV is expected to continue to rise with the construction and sale of the aforementioned
condominiums and townhomes in several smaller vacant lots in the City.
Due to anticipated impacts surrounding the COVID-19 (Coronavirus) pandemic, discussed in Note
18 of this report, the General Fund adopted budget for FY 2020-21 forecasted a $2.1 million deficit,
meaning adopted revenue projections of $46.7 million were expected to be lower than adopted
expenditure appropriations of $48.8 million. While the City has an overall philosophy to balance
the budget each year, the adopted budget took into account reduced revenues as a result of the
COVID-19 pandemic and projected FY 2019-20 ending reserve levels being above the current
General Fund Reserve Policy. Since FY 2020-21 budget adoption, mid-year revisions projects a
surplus of $2.3 million.
Over the next five years, the General Fund budget is estimated to remain steady. Several prudent
decisions by the City Council and proactive measures taken by Azusa residents puts the City in a
better financial position than other surrounding cities and alleviates the need for drastic measures
such as employee lay-offs or major service reductions at this time, in light of the economic impacts
brought on by the nationwide pandemic. In addition to renegotiating several franchise agreements
Finance Department ▪ 213 E. Foothill Blvd. ▪ P.O. Box 1395 ▪ Azusa, CA 91702-1395
Tel: (626) 812-5203 ▪ FAX (626) 334-6358
iv
to increase revenues, on March 3, 2020, Azusa residents voted in favor of Measure Z, a ¾-cent
transaction and use tax, which became effective July 1, 2020 and estimated to generate up to $4.5
million annually in additional revenues for the City.
In June 2018, the City expanded its 15% reserve policy, by adding three new designated reserve
categories to internally restricted funds in order to address some of its long-term financial liabilities
and potential areas of financial exposure, such as claims expenses, aging infrastructure, and for
rising retiree benefits. Each budget year, Staff recommends the City Council reaffirms or updates
the reserve policy given current financial forecasts. For the FY 2020-21 budget year, further
increased the designated reserve amounts as follows:
1) Budget Stabilization and Catastrophic Event (from 15% to 20% of budget or $9.8 million)
2) Capital and Infrastructure Replacement ($1.5 million)
3) Insurance (from $1.0 million to $1.5 million)
4) Retiree Benefits (from $1.5 million to $2.0 million)
By end of FY 2020-21, total General Fund reserves is expected to be $7.7 million above the reserves
target.
RELEVANT FINANCIAL POLICIES
The City of Azusa has adopted a comprehensive set of financial policies and/or ordinances. The
City requires the adoption of a balanced annual operating budget (i.e., estimated revenues equal
to or in excess of appropriations). In addition, budget amendments of $100,000 or more must be
approved by City Council; this is the legal level of budgetary control. A five-year Capital
Improvement Project Program is adopted each budget year and projects are maintained by project
life. Therefore, the budget appropriation for these projects may need to be re-budgeted in
subsequent accounting periods. Various other policies have been adopted related to debt, interfund
loans, internal controls, and fiscal sustainability to guide the City to continued financial health.
The City’s budget policy requires a balanced budget, meaning expenditures should not exceed
revenues. In addition to a budget policy, the City has a General Fund Reserve Policy which is used
as a benchmark tool to assess financial performance. The Reserve Policy consists of four categories
to internally restrict funds in order to address some of the City’s long-term financial liabilities and
potential areas of financial exposure, such as claims expenses, aged infrastructure, and rising
retiree benefits.
In total, restricted reserves amount to $9.8 million for the FY 2020-21 budget year and include: 1)
Budget Stabilization and Catastrophic Event ($6.6 million); 2) Capital and Infrastructure
Replacement ($1.5 million); 3) Insurance ($1.5 million); and 4) Retiree Benefits ($2.0 million). City
Council authorization is required for use of these reserves.
The table below briefly outlines the purpose of each reserve category:
CATEGORY PURPOSE
Budget Stabilization and
Catastrophic Event Reserve
To mitigate costs due to annual
budget revenue shortfalls as a result
of changes in economic environment
and/or one-time expenditures and
Finance Department ▪ 213 E. Foothill Blvd. ▪ P.O. Box 1395 ▪ Azusa, CA 91702-1395
Tel: (626) 812-5203 ▪ FAX (626) 334-6358
v
unforeseen emergencies or
catastrophic events
Capital Assets & Infrastructure
Replacement Reserve
To use for replacement of capital
assets and infrastructure such as
facilities, IT upgrades, and fleet
operations
Insurance Reserve To fund unanticipated liability and
worker’s compensation claims up to
City’s $250K SIR per claim
Retiree Benefits To mitigate impacts on City’s future
budgets due to rising retiree benefit
costs (pension and medical) and
reduce current $100+M long-term
liabilities for these benefits
As a general law city, Azusa operates its pooled idle cash investments under the Prudent Man
Rule (California Civil Code Section 2261, et. seq.), which in essence states that "in investing property
for the benefit of another, a trustee shall exercise the judgment and care, under circumstances then
prevailing, which men of prudence, discretion and intelligence exercise in the management of their
own affairs...” The City's cash management system is designed to monitor and forecast
expenditures and revenues as accurately as possible and to invest funds to the fullest extent
possible. The City attempts to obtain the highest available investment yields consistent with the
criteria established and outlined in the City's Investment Policy. Some of the instruments in which
the City may invest are: U.S. Government Securities, Certificates of Deposit, Bankers' Acceptances,
the State of California Local Agency Investment Fund (LAIF), Treasury Bills, Repurchase
Agreements, and regular savings and demand deposits.
As previously mentioned above, the City will continue to establish policies that will guide staff
and the departments to ensure continued financial health and stability.
LONG-TERM FINANCIAL PLANNING AND MAJOR INITIATIVES
The City has significant long-term liabilities relating to pension and other post-employment
benefits (OPEB) which increasingly strains the City’s budget. These rising retirement related costs
are a challenge for the City, while trying to maintain current service levels. Understanding the
importance of addressing rising OPEB and pension liabilities, Council authorized Staff to set aside
$2.0 million in reserves with adoption of the FY 2020-21 budget.
Cities, including Azusa, provide various benefits to employees which generally include pensions
for retirement. The City of Azusa has contracted with California Public Employees’ Retirement
System (CalPERS) for pension benefits since 1949. Over the years, the plans offered to employees
have changed in response to negotiations with the bargaining groups to remain competitive within
the local government market. In addition to pension plans, cities also offer benefits to attract and
retain quality employees and to promote longevity within the organization. Lifetime medical plans
is one of those benefits that has helped Azusa stabilize its workforce and retain employees for
tenures of 20 years or more.
While Azusa’s pension and life-time medical benefits have helped the City maintain a quality
workforce, these benefits over time have stressed the City’s budget and are difficult to maintain
status quo given the current revenue base.
Finance Department ▪ 213 E. Foothill Blvd. ▪ P.O. Box 1395 ▪ Azusa, CA 91702-1395
Tel: (626) 812-5203 ▪ FAX (626) 334-6358
vi
The City’s Annual pension payments are comprised of two components: 1) Normal Costs, which
are equal to the pension benefits earned by employees in the current year. These payments are
based on a percentage of payroll; and 2) Unfunded Accrued Liability (UAL), which represent
payments for past due amount for the funding shortfall of benefits earned by current employees
and retirees. UAL payments are fixed dollar payments.
Pension costs are calculated by actuaries at CalPERS based on various actuarial assumptions
including: member information; benefit provisions in the Azusa contracts with CalPERS; actual
experience with Azusa retirees; and actuarial assumptions and methods as approved by the
CalPERS Board. CalPERS actuaries evaluate all of this information and provide the City an annual
valuation update with the employer rates which are used in the preparation of the City’s budget.
Pension costs continue to rise due to decisions adopted by the CalPERS Board of Administration.
The passage of SB400 (1999) and AB616 (2001), which provided enhanced pension benefits with
the assumption the Fund would always remain strong, earning over 8% annually, and suffer no
losses, spearheaded the erosion of the CalPERS fund. Once the new enhanced plans were offered
to State employee groups, local bargaining groups followed closely behind requesting the same
benefit plans. Subsequently, dramatic market losses of the stock market turmoil in 2008 and 2009
contributed to further eroded value of the pension fund, where 30% of the portfolio was lost during
the Great Recession.
Consequently, in April 2013, CalPERS approved an amortization and smoothing policy to pay for
all gains and losses over a fixed 30-year period with the increases or decreases in the rate spread
directly over a 5-year period, as opposed to the previous policy which spread investment returns
over a 15-year period with gains and losses paid over a rolling 30-year period. Following the
amortization and smoothing policy changes, in December 2016, CalPERS announced they were
lowering their discount rate from 7.5% to 7% by FY 2020-21, and most recently, in February 2018,
CalPERS adopted a reduced amortization period for gains and losses to 20 years beginning with
the June 30, 2019 valuation with no amortization for surpluses. All of these changes combined,
results in significantly higher costs to the City.
CalPERS made these changes to address concerns that the funds confidence level was getting
dangerously low to the point of paying more in retirement benefits than contributions and
investment earnings could sustain. In essence, the fund would go broke if such adjustments were
not made. CalPERS pension costs account for approximately 16% of the General Fund’s total
operating expense in FY 2019-20.
In an effort to mitigate the pension issues, the State legislature passed legislation referred to as the
“Public Employees’ Pension Reform Act of 2013 (PEPRA), which became effective January 1, 2013.
PEPRA had several aspects to the law intended to cap costs. The most significant was all “new to
CalPERS” employees would now have a lower pension plan benefit. The City currently has around
84 active employees under PEPRA plans. The savings from PEPRA are long term.
The City also took actions to mitigate increasing costs. One action was to implement a second tier
pension plan for Safety employees that became effective July 2011; any new hire, considered a
“classic” employee because they are already in CalPERS, are now in this second tier. There are
currently 8 employees under the Tier 2 plan. The other action was to negotiate with the bargaining
units that employees would pay for their own pension benefit contribution as provided in the law.
Through successful negotiations, Miscellaneous employees pay 7% of their pension benefit and
Safety employees pay 9%.
Finance Department ▪ 213 E. Foothill Blvd. ▪ P.O. Box 1395 ▪ Azusa, CA 91702-1395
Tel: (626) 812-5203 ▪ FAX (626) 334-6358
vii
Employees agreeing to pick up a portion of their share helped to reduce the amount the City has
to pay annually for normal costs and the reduced benefit tiers helped with the unfunded liability
portion, however, significant unfunded liability still existed and annual payments were expected
to continue to rise through Fiscal Year 2030-31 before beginning to fall slightly. In December 2019,
Council authorized Staff to move forward with validation proceedings to consider issuing Pension
Obligation Bonds (POBs) in order to provide additional cash flows to address rapidly rising health
care costs and to stabilize the budget in future years for anticipated spikes in pension costs. The
City completed issuance of the POBs September 30, 2020, saving Azusa residents over $54 million
over the next 20 years.
Due to the implementation of GASB Statement No. 75, Accounting and Financial Reporting for
Postemployment Benefits Other Than Pensions (GASB 75), the City’s Fiscal Year End June 30, 2019
financial statements reflect a $48.5 million OPEB liability, an increase of $7.3 million from 2018. The
most recently updated OPEB actuarial study shows the liability increased to $63.8 million in 2020,
a 31.5% increase.
Participation in CalPERS health plan programs contractually obligates the City to pay at least the
PEMHCA minimum cost for each retiree. Furthermore, the City continues to offer 50-100% of paid
retiree medical to employees with 10-20 years of service, including spousal coverage. City-paid
medical benefit for employees and their spouses for the rest of the retirees’ lives is extremely
generous and financially unsustainable going forward, especially in light of rapidly increasing
health-care costs and longer life spans.
To mitigate future costs, the City established a Health Reimbursement Arrangement (HRA) for its
Executive Staff and all eight (8) of the City’s bargaining groups to replace the lifetime medical
benefit. Implementation of the HRA for most of the groups took effect after the 2019 fiscal year,
and while implementation of the HRA reduced the City’s future OPEB obligation by over $10
million, the liability increased because of market conditions surrounding the COVID-19 pandemic.
Annual payments for those still under the lifetime medical benefit provision are still expected to
rise and cause strain on the City’s budget.
The City has a “pay-go” system for OPEB obligations. Meaning, we pay retiree medical costs
annually as incurred. In Fiscal Year 2020, payments for retiree medical were $1,388,061, a 38.4%
increase from the prior year. Annual retiree medical payments have increased 110% over the last
five years and costs are expected to continue to rise with pending retirements and longer life
expectancies. Cash flow savings from issuance of POBs could be used to establish an interest baring
OPEB trust account, where the City would make deposits and have the ability to allow the account
to grow over time or to set aside internally restricted funds as a budget stabilization tool.
The laws relating to the dissolution of the former Redevelopment Agency of the City of Azusa
(“RDA”) continue to be reflected on the City’s financial statements. The RDA properties transferred
to the City, to repay several loans, were ordered by the California State Department of Finance
(“DOF”) to be returned to the Successor Agency to the RDA (“SA”). However, the DOF approved
the reinstatement of one of the loans the City holds with SA, and began receiving annual
installments for the repayment of that loan in FY 2016-17. In the future, the City may request
reinstatement of other loans between the City and the SA in order to be repaid.
Despite the dissolution of the Redevelopment Agency and increasing retirement and medical costs,
the City continues to pursue economic development to increase the City’s tax base, revenue
sources, and create and retain jobs to ensure the improvement of its financial health. Pursuing
smart development opportunities as a mechanism to help revitalize the City is crucial to the City’s
City of Azusa
ELECTED OFFICIALS AND DEPARTMENT HEADS
213 E. Foothill Boulevard
Azusa, CA 91702
(626) 812-5200
Fax (626) 334-6358
www.AzusaCA.gov
ELECTED OFFICIALS TITLE TERM EXPIRATION
Jeffrey L. Cornejo Jr. City Clerk March 2022
Art Vasquez City Treasurer March 2022
Robert Gonzales Mayor March 2022
Jesse Avila Jr. Mayor Pro-Tem March 2024
Uriel E. Macias Councilmember March 2024
Edward J. Alvarez Councilmember March 2022
Andrew N. Mendez Councilmember March 2022
DEPARTMENT HEADS TITLE PHONE NUMBER
Sergio Gonzalez
Nico DeAnda-Scaia
City Manager
Deputy City Manager
626-812-5238
626-812-5178
Robert Delgadillo Director of Public Works/ City Engineer 626-812-5248
Matt Marquez Director of Economic & Community Development 626-812-5236
Mike Bertelsen Chief of Police 626-812-3250
Ann Graf Director of Information Technology and Library 626-812-5024/5277
Miki Carpenter Director of Community Resources 626-812-5220
Manny Robledo Director of Utilities 626-812-5219
Talika M. Johnson Director of Administrative Services 626-812-5203/5183
Daryl L. Osby Fire Chief 626-974-8371
Marco Martinez City Attorney (Best, Best, & Krieger) 949-263-2603
ix
Citizens of Azusa
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x
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Azusa
California
For its Comprehensive Annual
Financial Report
For the Fiscal Year Ended
June 30, 2019
Executive Director/CEO
xi
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xii
INDEPENDENT AUDITORS’ REPORT
To the Honorable Mayor and Members of the City Council
of the City of Azusa
Azusa, California
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business-
type activities, each major fund, and the aggregate remaining fund information of the City of Azusa,
California (City) as of and for the year ended June 30, 2020, and the related notes to the financial
statements, which collectively comprise the City’s basic financial statements as listed in the table of
contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
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 entity’s
preparation and fair presentation of the financial statements in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of
significant accounting estimates made by management, as well as evaluating the overall presentation of
the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
2
To the Honorable Mayor and Members of the City Council
of the City of Azusa
Azusa, California
Page 2
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business-type activities, each major
fund, and the aggregate remaining fund information of the City as of June 30, 2020, and the respective
changes in financial position, and, where applicable, cash flows thereof for the year then ended in
accordance with accounting principles generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
management’s discussion and analysis, budgetary comparison information, pension supplementary
information, and other post employment benefits information on pages 5-18 and 108-119, be presented
to supplement the basic financial statements. Such information, although not a part of the basic
financial statements, is required by the Governmental Accounting Standards Board, who considers it to
be an essential part of financial reporting for placing the basic financial statements in an appropriate
operational, economic, or historical context. We have applied certain limited procedures to the required
supplementary information in accordance with auditing standards generally accepted in the United
States of America, which consisted of inquiries of management about the methods of preparing the
information and comparing the information for consistency with management’s responses to our
inquiries, the basic financial statements, and other knowledge we obtained during our audit of the
basic financial statements. We do not express an opinion or provide any assurance on the information
because the limited procedures do not provide us with sufficient evidence to express an opinion or
provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the City’s basic financial statements. The introductory section, combining and
individual nonmajor fund financial statements, budgetary comparison schedules on pages 122 to 168,
and statistical section are presented for purposes of additional analysis and are not a required part of
the basic financial statements.
The combining and individual nonmajor fund financial statements, and the budgetary comparison
schedules on pages 122 to 168 are the responsibility of management and were derived from and relate
directly to the underlying accounting and other records used to prepare the basic financial statements.
Such information has been subjected to the auditing procedures applied in the audit of the basic
financial statements and certain additional procedures, including comparing and reconciling such
information directly to the underlying accounting and other records used to prepare the basic financial
statements or to the basic financial statements themselves, and other additional procedures in
accordance with auditing standards generally accepted in the United States of America. In our opinion,
the combining and individual nonmajor fund financial statements, and the budgetary comparison
schedules on pages 122 to 168 are fairly stated in all material respects in relation to the basic financial
statements as a whole.
3
To the Honorable Mayor and Members of the City Council
of the City of Azusa
Azusa, California
Page 3
The introductory section and statistical section 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.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated April 21, 2021,
on our consideration of the City’s internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts, and grant agreements and other
matters. The purpose of that report is to describe the scope of our testing of internal control over
financial reporting and compliance and the results of that testing, and not to provide an opinion on
internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the City’s internal control
over financial reporting and compliance.
Badawi and Associates
Certified Public Accountants
Berkeley, California
April 21, 2021
4
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City of Azusa
Management’s Discussion and Analysis
June 30, 2020
As management of the City of Azusa, California, we offer this narrative overview and analysis of
the financial activities of the City of Azusa for the fiscal year ended June 30, 2020. We encourage
readers to consider the information presented here in conjunction with additional information
furnished in our letter of transmittal, which can be found on pages i through viii of this report.
Financial Highlights
The assets and deferred outflows of resources of the City exceeded its liabilities and deferred
inflows of resources at the close of fiscal year 2020 by $89,648,626 (net position).
Total City assets of $305,820,379 include $155,650,401 or 50.9% of non-current assets attributed
to capital assets, net of depreciation.
Total City liabilities of $244,556,861 include $212,767,958 or 87.0% of long-term liabilities
attributed mainly to tax allocation bonds, certificates of participation, pension, and other post-
employment liabilities.
As of June 30, 2020, the City’s governmental funds reported combined fund balances of
$53,476,355.
At the end of the current fiscal year, the total fund balance for the General Fund was increased
by $6,302,560 (22.8%) (including prior year restatements) to $33,900,453.
Total General Fund revenues received for the year were $46,394,361 and total General Fund
expenditures for the year were $34,631,211, an excess of revenues over expenditures
amounting to $11,763,150 (25.3%). This does not include capital lease financing, transfers, and
proceeds from the sale of capital assets. Details are located within the General Fund Budgetary
Highlights within the MD & A.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the City’s basic financial
statements, which are comprised of three components: 1) government-wide financial statements,
2) fund financial statements, and 3) notes to the basic financial statements. This report also
contains other supplementary information in addition to the basic financial statements
themselves.
1) Government-wide financial statements. The government-wide financial statements are designed
to provide readers with a broad overview of the City’s finances, in a manner similar to a private-
sector business.
5
City of Azusa
Management’s Discussion and Analysis
June 30, 2020
The statement of net position presents information on all of the City’s assets and liabilities, with the
difference between the two reported as net position. Over time, increases or decreases in net
position may serve as a useful indicator of whether the financial position of the City of Azusa is
improving or deteriorating.
The statement of activities presents information showing how the government’s net position
changed during the most recent fiscal year. All changes in net position are reported as soon as
the underlying event giving rise to the change occurs, regardless of the timing of related cash
flows. Thus, revenues and expenses are reported in this statement for some items that will only
result in cash flows in future fiscal periods (e.g. uncollected taxes and earned but unused vacation
leave).
Both of the government-wide financial statements distinguish functions of the City of Azusa that
are principally supported by taxes and intergovernmental revenues (governmental activities)
from other functions that are intended to recover all or a significant portion of their costs through
user fees and charges (business-type activities). The governmental activities of the City include
General Government, Public Safety, Community Development, Parks and Recreation, Public
Works, and Grants & Seizures. The business-type activity of the City includes the City’s Water,
Light, Sewer/Wastewater, and Refuse Contract Utility operations.
The government-wide financial statements include not only the City of Azusa itself (known as
the primary government), but also the legally separate Successor Agency to the former
Redevelopment Agency of the City of Azusa (“Successor Agency”) and the Azusa Public
Financing Authority for which the City of Azusa is financially accountable. Financial information
for these component units has been included as an integral part of the primary government.
2) Fund financial statements. A fund is a grouping of related accounts that is used to maintain
control over resources that have been segregated for specific activities or objectives. The City of
Azusa, like other state and local governments, uses fund accounting to ensure and demonstrate
compliance with finance-related legal requirements. All of the funds of the City can be divided
into three categories: governmental funds, proprietary funds, and fiduciary funds.
Governmental funds. Governmental funds are used to account for essentially the same functions
reported as governmental activities in the government-wide financial statements. However, unlike
the government-wide financial statements, governmental fund financial statements focus on
near-term inflows and outflows of spendable resources, as well as on balances of spendable
resources available at the end of the fiscal year. Such information may be useful in evaluating a
government’s near-term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial
statements, it is useful to compare the information presented for governmental funds with similar
information presented for governmental activities in the government-wide financial statements.
By doing so, readers may better understand the long-term impact of the government’s near-term
financing decisions. Both the governmental fund balance sheet and governmental fund
statement of revenues, expenditures, and changes in fund balances provide a reconciliation to
facilitate this comparison between governmental funds and governmental activities.
6
City of Azusa
Management’s Discussion and Analysis
June 30, 2020
The City of Azusa maintains 26 individual governmental funds. Information is presented
separately in the governmental fund balance sheet and in the governmental fund statement of
revenues, expenditures, and changes in fund balance for the General Fund is considered to be a
major fund. The Rosedale Contribution (“RC”) Fund is a separate fund, but is combined with
the General Fund, as the funds in the RC Fund are considered unrestricted. Data from the other
25 governmental funds are combined into a single, aggregate presentation. Individual fund data
for each of these non-major governmental funds is provided in the form of combining statements
elsewhere in this report.
The City of Azusa adopts an annual appropriated budget for each of its governmental funds. A
budgetary comparison statement has been provided for the General Fund and all Special
Revenue Funds, Capital Project Funds, and Debt Service Funds to demonstrate compliance with
this budget.
Proprietary funds. The City of Azusa maintains two different types of proprietary funds, enterprise
and internal service funds. Enterprise funds are used to report the same functions presented as
business-type activities in the government-wide financial statements. The City uses an enterprise
fund to account for its Water, Light, Sewer/Wastewater, and Refuse Contract Utilities. Internal
service funds are an accounting device used to accumulate and allocate costs internally among
the City’s various functions. The City uses an internal service fund to account for its Consumer
Services, Self-Insurance/Risk Management, Central Services, Equipment Replacement, and
Information Technology Services activity. Because these services predominantly benefit
governmental rather than business type functions, they have been included within governmental
activities in the government-wide financial statements.
Proprietary funds provide the same type of information as the government-wide financial
statements (business-type activities), only in more detail. Information is presented separately in
the proprietary fund statement of net position and in the proprietary fund statement of revenues,
expenditures, and changes in net position for the Water and Light funds. The Water and Light
funds are considered to be major funds. The internal service funds are also presented in the
proprietary fund financial statements.
Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties
outside the government, and the City’s role is purely custodial. Fiduciary funds are not reflected
in the government-wide financial statements because the resources of those funds are not
available to support the City’s own programs. All assets reported in Fiduciary funds are offset
by a liability; the accrual basis of accounting is used to recognize receivables and payables.
3) Notes to the basic financial statements. The notes provide additional information that is
essential to a full understanding of the data provided in the government-wide and fund financial
statements.
Other supplementary information. The combining financial statements and schedules referred
to earlier in connection with non-major governmental funds and internal service funds are
presented immediately following the notes to the basic financial statements.
7
City of Azusa
Management’s Discussion and Analysis
June 30, 2020
Government-wide Financial Analysis
The following table presents a summary of the City’s assets, liabilities, and net position for its
governmental and business type activities. As noted earlier, a government’s net position may
serve over time as a useful indicator of its financial position.
As of June 30, 2020, the City’s assets and deferred outflows of resources exceeded liabilities and
deferred inflows of resources by $89,648,626, representing a decrease of $18,653 (.02%) from the
prior year. The decrease is mainly attributed to the increase liabilities including OPEB, pension,
claims and judgements payable, and accounts payable, offset by increases in capital assets, pooled
cash and investments, accounts receivable.
The largest portion of the net position reflects the City’s $100,172,819 net investment in capital
assets. Capital assets are the aggregated value of land, buildings, and improvements that are used
to provide services. Although the City’s investment in its capital assets is reported net of related
debt, the resources needed to repay this debt must be provided from other sources since the
capital assets themselves cannot be used to liquidate these liabilities.
Another portion of the City’s net position is subject to external restrictions, such as debt
covenants, grantor’s stipulations, or enabling legislation on how funds may be used. As of June
30, 2020, the restricted assets were $32,189,413 of the total net position, of this amount, $10,941,541
is for a rate stabilization fund, $6,585,553 for debt service related activities, $8,494,425 is restricted
for community development projects such as transportation projects and $5,827,173 for capital
projects such as street repair and maintenance. The remaining amount relates to Police grants.
2020 2019 2020 2019 2020 2019
Current and other assets 60,681,535$ 51,785,854$ 89,488,443$ 92,245,501$ 150,169,978$ 144,031,355$
Capital assets, net 38,610,254 37,099,707 117,040,147 111,151,902 155,650,401 148,251,609
Total assets 99,291,789 88,885,561 206,528,590 203,397,403 305,820,379 292,282,964
Deferred charge on refunding - - 1,333,974 1,419,951 1,333,974 1,419,951
Deferred OPEB related items 14,223,106 4,224,249 748,585 222,328 14,971,691 4,446,577
Deferred pension related items 12,676,775 13,388,503 2,813,436 3,374,992 15,490,211 16,763,495
Total deferred outflows of resources 26,899,881 17,612,752 4,895,995 5,017,271 31,795,876 22,630,023
Current liabilities 14,252,132 11,184,726 17,536,771 16,040,268 31,788,903 27,224,994
Long-term liabilities 138,385,013 119,406,272 74,382,945 75,821,531 212,767,958 195,227,803
Total liabilities 152,637,145 130,590,998 91,919,716 91,861,799 244,556,861 222,452,797
Deferred pension related items 2,997,846 2,199,628 412,922 593,283 3,410,768 2,792,911
Total deferred inflows of resources 2,997,846 2,199,628 412,922 593,283 3,410,768 2,792,911
Net investment in capital assets 37,408,295 35,457,264 62,764,524 53,360,644 100,172,819 88,817,908
Restricted 15,197,634 13,301,354 16,991,779 16,784,663 32,189,413 30,086,017
Unrestricted (82,049,250) (75,050,931) 39,335,644 45,814,285 (42,713,606) (29,236,646)
Total net position (deficits)(29,443,321)$ (26,292,313)$ 119,091,947$ 115,959,592$ 89,648,626$ 89,667,279$
Summary of Net Position (Deficits) for the year ended June 30
Governmental Business Type
Activities Activities Total
8
City of Azusa
Management’s Discussion and Analysis
June 30, 2020
At June 30, 2020, the unrestricted net position was a negative $42,713,606. The negative net
position is largely due to the implantation of GASB Statement No. 68, Accounting and Financial
Reporting for Pensions, in fiscal year 2014-15 and the implementation of GASB Statement No. 75,
Accounting and Financial Reporting for Postemployment Benefits Pension Other Than Pensions (GASB
75) in fiscal year 2016-17. GASB 75, however, has had the largest material impact on the City’s
financial statements, representing an increase of $7.3 million in the City’s reported other
postemployment benefits (OPEB) liability in fiscal year 2018-19 and $15.3 million in fiscal year
2019-20 . The primary objective of GASB 75 is to improve accounting and financial reporting by
state and local governments for postemployment benefits other than pensions or OPEB. It also
improves information provided by state and local governmental employers about financial
support for OPEB provided by other entities. See Notes 1 and 8 of the financial statements for
further detail.
The following chart shows the comparison of the three components of net position for Fiscal
Years 2018-19 and 2019-20 (in millions):
Governmental activities. The following condensed summary of activities of the City’s
governmental activities for the year ended June 30, 2020 shows total net position is a negative
$29,443,321 a decrease of $3,151,008 (12.0%) from prior year as restated and primarily attributable
to increases in current and long-term liabilities, offset by increased current and other assets.
Business type activities. Business type activities net position totaled $119,091,947, an increase of
$3,132,355 (2.7%) from the prior year, restated and attributed to positive operating results.
Net Investment in
Capital Assets Restricted Unrestricted Total Net Position
FY 18/19 $88.8 $30.1 $(29.2) $89.7
FY 19/20 $100.2 $32.2 $(42.7) $89.7
$(15.0)
$-
$15.0
$30.0
$45.0
$60.0
$75.0
$90.0
$105.0
Government-wideNet Position
Year Ended June 30, 2020
9
City of Azusa
Management’s Discussion and Analysis
June 30, 2020
The City’s total revenues were $133,809,964 and the costs of all programs and services were
$134,085,139. Fiscal year 2019-20 revenues increased by $6,283,281 (4.9%) and expenses increased
by $11,022,706 (9.0%) from prior year. Highlights of key revenue factors and program costs for
governmental and business type activities are noted later in this report.
2020 2019 2020 2019 2020 2019
Program Revenues:
Charges for services 13,744,806$ 12,475,216$ 71,736,440$ 70,527,240$ 85,481,246$ 83,002,456$
Operating contributions and grants 7,986,715 6,114,947 763,180 714,750 8,749,895 6,829,697
Capital contributions and grants 2,424,903 2,094,896 - - 2,424,903 2,094,896
General Revenues:
Taxes 33,986,373 32,868,263 - - 33,986,373 32,868,263
Investment earnings 859,705 609,862 1,221,072 1,087,005 2,080,777 1,696,867
Miscellaneous 1,086,770 1,034,504 - - 1,086,770 1,034,504
Total Revenues 60,089,272 55,197,688 73,720,692 72,328,995 133,809,964 127,526,683
Expenses:
General Government 14,858,996 14,252,142 - - 14,858,996 14,252,142
Public Safety 33,034,073 28,234,043 - - 33,034,073 28,234,043
Community Development 3,892,609 3,355,295 - - 3,892,609 3,355,295
Parks and Recreation 5,077,503 4,761,394 - - 5,077,503 4,761,394
Public Works 9,015,108 7,954,532 - - 9,015,108 7,954,532
Interest on long-term debt 225,826 253,667 - - 225,826 253,667
Water - - 24,608,822 23,608,977 24,608,822 23,608,977
Light - - 36,579,394 34,562,979 36,579,394 34,562,979
Sewer/Wastewater - - 2,705,943 2,344,737 2,705,943 2,344,737
Refuse Contract - - 4,086,865 3,734,667 4,086,865 3,734,667
Total Expenses 66,104,115 58,811,073 67,981,024 64,251,360 134,085,139 123,062,433
Increase/(decrease) in net position
before transfers (6,014,843) (3,613,385) 5,739,668 8,077,635 (275,175) 4,464,250
Transfers 2,607,313 1,866,900 (2,607,313) (1,866,900) - -
Change in Net Position (3,407,530) (1,746,485) 3,132,355 6,210,735 (275,175) 4,464,250
Net Position (Deficits) - Beginning (26,035,791) (24,694,641) 115,959,592 109,733,284 89,923,801 85,038,643
Restatement - 148,813 - 15,573 - 164,386
Net Position (Deficits) - Ending (29,443,321)$ (26,292,313)$ 119,091,947$ 115,959,592$ 89,648,626$ 89,667,279$
Summary of Changes in Net Position (Deficits) for the year ended June 30
Governmental Business Type
Activities Activities Total
10
City of Azusa
Management’s Discussion and Analysis
June 30, 2020
In comparison to prior fiscal year, total Governmental revenues increased by $4,891,584 (8.9%).
Key elements of this year’s summary of activities are as follows:
Charges for services increased by $1,269,590 (10.2%), mainly attributable to increased fire
safety fees of $1.1M relating to LA County fire fee changes and backlogged service
requests and the increased value of water rights by $115K.
Property tax revenue of $12,520,153 increased by $797,550 (6.8%) primarily due to
increased assessed value of homes.
Contributions and Grants of $10,411,618 increased by $2,201,775 (26.8%) due to higher
reportable sales transactions by businesses that have franchise agreements with the City
as well as collections of special revenues from LA County such as Measure M and
Measure W proceeds.
Investment earnings and miscellaneous revenue increased by $302,109 (18.4%) primarily
due to higher cash balances.
Sales tax revenue increased by $501,598 (7.9%) due to new business developments within
the City.
11
City of Azusa
Management’s Discussion and Analysis
June 30, 2020
In comparison to prior fiscal year, total Governmental Activities increased by $7,293,042 (12.4%).
Key elements of this year’s summary of activities are:
General Government expenses increased $606,854 (4.3%) compared to prior year. The
increase is a result of year-end adjustments to record changes in net pension liability and
total OPEB liability as well as internal service fund expense allocations.
Public Safety expenses increased by $4,800,030 (17.0%) primarily due to increased LA
County Fire Safety contract costs, capital purchases of patrol vehicles and armored truck,
year-end adjustments to record changes in net pension liability and total OPEB liability,
and internal service fund expense allocations.
Public Works expenditures increased by $1,060,576 (13.3%) as a result of year-end
adjustments to record changes in net pension liability and total OPEB liability as well as
capital asset acquisitions, and internal service fund expense allocations.
12
City of Azusa
Management’s Discussion and Analysis
June 30, 2020
Financial Analysis of the City’s Funds
As noted earlier, the City of Azusa uses fund accounting to ensure and demonstrate compliance
with finance-related legal requirements.
Governmental funds. The focus of the City’s governmental funds is to provide information on
near-term inflows, outflows, and balances of spendable resources. This information is useful in
assessing the City’s financing requirements. In particular, unreserved fund balance may serve as
a useful measure of a government’s net resources available for spending during the fiscal year.
At the end of the current fiscal year, the City’s governmental funds reported combined ending
fund balances of $53,476,355, an increase of $7,600,314 (16.7%) in comparison with the prior year’s
revised fund balance. The increase is attributed to positive operating results (revenues exceeding
expenditures).
The General Fund is the chief operating fund of the City of Azusa. During fiscal year 2019-20, its
ending fund balance of $33,900,453 increased by $6,549,138 (23.9%) from prior year. Revenues
from taxes, use of money and property, and other miscellaneous sources were higher than last
year by nearly $1,463,349 (3.3%) attributable to higher assessed property values, increased
activities from developed businesses, and higher interest rate returns on investments. Overall,
General Fund expenditures decreased by $747,605 (2.1%) as a result lower personnel costs from
vacancies and lower capital outlays which were delayed to the next budget year.
This year, the Fire Safety Special Revenue Fund was added to the Governmental Funds financial
statements due to its ending fund balance. The Fire Safety Funds records all expenses and
revenues relating to the City’s contract with LA County for fire services. During fiscal year 2019-
20, its ending fund balance of $934,019 increased by $258,354 (38.2%) in comparison with the prior
year’s revised fund balance attributable to revenue collections from increase
Non-Major Governmental Funds consist of 23 special revenue, capital project, and debt service
funds. In total, these funds reported a combined ending 2019-20 fund balance of $18,641,883, an
increase of $728,878 (4.4%) from prior year (as restated). Activities by fund can be found starting
on page 124 of this report.
Proprietary funds. The City’s proprietary funds provide the same type of information found in
the government-wide financial statements, but in more detail.
Unrestricted net position of the City’s Enterprise funds (Business-Type Activities) at the end of
the year amounted to $45,569,190. Total unrestricted net position decreased by $4,419,427 (8.8%)
and total net position increased by $4,597,108 (3.8%) from the previous fiscal year as restated.
13
City of Azusa
Management’s Discussion and Analysis
June 30, 2020
Unrestricted net position of the City’s Water Utility at the end of the year amounted to
$19,557,265, a decrease of $5,391,235 (21.6%). However, total net position decreased only by
$228,060 (-0.4%) from prior year as restated, due to use of cash to fund capital improvements.
Water operating revenues, Including transfers, were up by $2,099,000 (9.4%) expenses, excluding
transfers, increased by $1,334,565, (6.2%). The increase in revenues is largely due to $2,016,181 in
increased water supply costs passed down to customers through rates, although overall
consumption was down as a result of the COVID-19 pandemic (discussed in Note 18 of the Notes
to the Basic Financial Statements) and conservation efforts. Conversely, expenses increased
mainly due to higher source of water supply costs.
Unrestricted net position of the City’s Light Utility at the end of the year amounted to $20,621,379.
Total unrestricted net position decreased by $26,620 (.13%) and total net position increased by
$4,032,629 (7.2%) from the previous fiscal year as restated. Operating revenues, including
transfers, decreased by $1,227,076 (3.0%) and expenses, including transfers, increased by
$1,577,406 (5%), from prior year. The decrease in revenues primarily reflects a decrease in sales
and services, interdepartmental and miscellaneous charges in the commercial sector in fiscal year
2019-20 as a result of the COVID-19 pandemic. The increase in expenses primarily reflects an
increase in the cost of power.
The following chart highlights total revenue and total expenses, including transfers, for each of
the business type activities for fiscal year end June 30, 2020:
14
City of Azusa
Management’s Discussion and Analysis
June 30, 2020
General Fund Budgetary Highlights
Following is a summary of budgetary changes and actual results for General Fund, revenues,
expenditures, and other financing sources:
The final amended expenditure budget was less than the original adopted budget by $525,627.
Salary savings as a result of vacant positions was the main driver of the lower amended budget,
offset by increased plan check consulting fees also due to vacancies.
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:
Taxes 34,452,866$ 34,352,866$ 35,864,262$ 1,511,396$
Charges for services 1,967,063 1,847,063 3,123,002 1,275,939
Assessments 3,459,193 3,459,193 2,547,233 (911,960)
Other revenue 3,333,248 3,537,248 4,868,480 1,331,232
Total revenue 43,212,370 43,196,370 46,402,977 3,206,607
Expenditures:
Operations 38,223,227 37,667,077 34,422,102 (3,244,975)
Capital Outlay 110,395 110,395 107,475 (2,920)
Debt Service 634,809 665,332 101,632 (563,700)
Total expenditures 38,968,431 38,442,804 34,631,209 (3,811,595)
Excess/(Deficiency) of revenues
over expenditures 4,243,939 4,753,566 11,771,768 7,018,202
Other Financing Sources/(Uses):
Transfers in 1,497,450 1,497,450 1,497,450 -
Transfers out 6,966,658 6,966,658 6,966,658 -
Total other financing sources (uses) (5,469,208) (5,469,208) (5,469,208) -
Net change in fund balance (1,225,269) (715,642) 6,302,560 7,018,202
Fund balance beginning of year 27,597,893 27,597,893 27,597,893 -
Fund balance end of year $26,372,624 $26,882,251 $33,900,453 $7,018,202
General Fund Budgetary Summary
Revenues, Expenditures, and Changes in Fund Balance
June 30, 2020
Budgeted Amounts
15
City of Azusa
Management’s Discussion and Analysis
June 30, 2020
Capital Asset and Debt Administration
Capital assets. The City’s net investment in capital assets for its governmental and business type
activities as of June 30, 2020 amounted to $155,650,401. This investment includes land,
construction in progress, land improvements, buildings and structures, machinery and
equipment, automotive equipment, and infrastructure.
Additional information on the City’s capital assets can be found in Note 4 of the Notes to the
Basic Financial Statements.
Long-term debt. At the end of the current fiscal year, the City of Azusa had total debt
outstanding of $141,955,140. Of this amount, $81,666,485 is a liability of the Governmental
Activities and $60,288,655 is a liability of the Business Type Activities.
Additional information on the City’s long-term debt and OPEB liability can be found in Notes 5,
6 and 8, of the Notes to the Basic Financial Statements.
2020 2019 2020 2019 2020 2019
Land 3,562,016$ 3,562,016$ 2,988,973$ 2,988,973$ 6,550,989$ 6,550,989$
Construction in Progress 3,443,308 2,023,805 7,664,943 2,627,605 11,108,251 4,651,410
Land Improvements 722,362 843,780 228,969 266,764 951,331 1,110,544
Buildings and Structures 6,414,172 6,306,436 11,096,833 10,926,027 17,511,005 17,232,463
Machinery and Equipment 919,770 938,227 1,878,263 1,910,934 2,798,033 2,849,161
Automotive Equipment 978,738 448,324 473,210 406,183 1,451,948 854,507
Infrastructure 22,569,888 22,977,119 92,708,956 92,025,416 115,278,844 115,002,535
Total 38,610,254$ 37,099,707$ 117,040,147$ 111,151,902$ 155,650,401$ 148,251,609$
Capital Assets for the year ended June 30
(Net of Accumulated Depreciation)
Governmental Business Type
Activities Activities Total
2020 2019 2020 2019 2020 2019
Employee Leave Benefits 3,655,212$ 3,503,051$ 1,489,703$ 1,302,142$ 5,144,915$ 4,805,193$
Net OPEB Liability 60,597,752 46,082,050 3,189,355 2,425,372 63,787,107 48,507,422
Advance from the Successor Agency 8,208,833 8,208,833 - - 8,208,833 8,208,833
2003 COPS 845,000 1,160,000 - - 845,000 1,160,000
2011 Sewer Installment Loan - - 2,790,000 3,205,000 2,790,000 3,205,000
2012 Electric Refunding Bond - - 3,555,000 4,375,000 3,555,000 4,375,000
2012 Water Refunding Bonds - - 3,565,000 4,375,000 3,565,000 4,375,000
2015 Water Refunding Bonds - - 42,850,000 44,160,000 42,850,000 44,160,000
2016 T.R.I.P Installment Sale 3,170,000 3,280,000 - - 3,170,000 3,280,000
Claims and Judgments Payable 4,995,341 3,578,014 (1)- - 4,995,341 3,578,014
Capital Lease 40,943 83,496 - - 40,943 83,496
Unamortized Premium/(Discount) 153,404 154,946 2,849,597 3,096,209 3,003,001 3,251,155
Total 81,666,485$ 66,050,390$ 60,288,655$ 62,938,723$ 141,955,140$ 128,989,113$
(1) Restated
Outstanding Debt for the year ended June 30
Governmental Business Type
Activities Activities Total
16
City of Azusa
Management’s Discussion and Analysis
June 30, 2020
Economic Factors and Next Year’s Budgets and Rates
The City has an overall budget philosophy of balancing the annual budget, meaning matching
expenditures to revenues, while maintaining high quality services for the Azusa Community. In
anticipation of growing annual budget deficits, starting in fiscal year 2018-19, and through fiscal
year 2019-20, the City underwent an extensive fiscal sustainability assessment, including
soliciting Community input on service priorities. In addition to prioritizing services, the City had
to address growing long-term liabilities. The General Fund Reserve Policy is one mechanism used
to address long-term obligations.
The General Fund Reserve Policy consists of four categories to mitigate risk in high liability
exposure areas: 1) Budget Stabilization and Catastrophic Event (20% of budget or $10.1 million
of the FY 2020-21 revised budget); 2) Capital and Infrastructure Replacement ($1.5 million); 3)
Insurance ($1.5 million); and 4) Retiree Benefits ($2.0 million). City Council authorization is
required for use of these reserves.
Actions taken by the Council, such as, issuing Pension Obligation Bonds to pay-off the City’s
unfunded pension liability, re-negotiating franchise revenue agreements, allowing residents to
vote on additional revenue generating measures, and continuing to run city operations as
efficient as possible, has resulted in the City being in a healthy financial position, reversing
projected annual deficits up to $2.7 million annually over the next five years to projected
surpluses up to $2.6 million; the projected surpluses included anticipated impacts of the COVID-
19 pandemic. Still, throughout the upcoming year’s budget process, further direction is needed
to address the City’s growing $63.8 million OPEB liability, new layers of pension debt, aging
infrastructure, and evolving community growth and needs.
Request for Information
This financial report is designed to provide a general overview of the financial position of the
City of Azusa for all those with an interest in the government’s finances. Questions concerning
any of the information provided in this report or requests for additional information should be
addressed to City of Azusa Administrative Services Department - Finance, 213 E. Foothill Blvd.,
Azusa, CA 91702.
17
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18
BASIC
FINANCIAL STATEMENTS
19
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20
GOVERNMENT-WIDE
FINANCIAL STATEMENTS
21
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22
Statement of Net Position
June 30, 2020
Governmental Business-Type
Activities Activities Total
ASSETS
Current assets:
Cash and investments 41,443,129$ 57,044,630$ 98,487,759$
Restricted assets:
Cash with fiscal agent 3,007,388 6,050,238 9,057,626
Cash held for rate stabilization - 10,941,541 10,941,541
Receivables:
Accounts, net 5,023,081 8,196,578 13,219,659
Taxes 3,435,099 - 3,435,099
Notes and loans 60,824 40,139 100,963
Accrued interest 61,280 73,127 134,407
Prepaid costs 1,020,830 14,375 1,035,205
Inventories 146,762 1,950,670 2,097,432
Total current assets 54,198,393 84,311,298 138,509,691
Noncurrent assets:
Internal balances (2,561,133) 2,561,133 -
Due from Successor Agency 7,041,408 2,616,012 9,657,420
Land held for resale 2,002,867 - 2,002,867
Capital assets:
Non-depreciable 7,005,324 10,653,916 17,659,240
Depreciable, net 31,604,930 106,386,231 137,991,161
Total capital assets 38,610,254 117,040,147 155,650,401
Total noncurrent assets 45,093,396 122,217,292 167,310,688
TOTAL ASSETS 99,291,789 206,528,590 305,820,379
DEFERRED OUTFLOWS OF RESOURCES
Deferred charge on refunding of debt - 1,333,974 1,333,974
Deferred outflows related to OPEB 14,223,106 748,585 14,971,691
Deferred outflows related to pension 12,676,775 2,813,436 15,490,211
TOTAL DEFERRED OUTFLOWS OF RESOURCES 26,899,881 4,895,995 31,795,876
LIABILITIES
Current liabilities:
Accounts payable 3,422,166 7,493,950 10,916,116
Accrued liabilities 1,217,539 601,356 1,818,895
Accrued interest 27,841 1,024,078 1,051,919
Unearned revenue 2,781,493 35,158 2,816,651
Deposits payable 16,207 3,854,525 3,870,732
Due to other governments 1,903 24,943 26,846
Compensated absences - due within one year 2,576,081 1,022,761 3,598,842
Claims and judgements - due within one year 3,207,959 - 3,207,959
Long term debt- due within one year 1,000,943 3,480,000 4,480,943
Total current liabilities 14,252,132 17,536,771 31,788,903
Noncurrent liabilities:
Due to Successor Agency 8,208,833 - 8,208,833
Total OPEB liability 60,597,750 3,189,357 63,787,107
Net pension liabilities 63,503,513 18,597,049 82,100,562
Compensated absences - due in more than one year 1,079,131 466,942 1,546,073
Claims and judgements - due in more than one year 1,787,382 - 1,787,382
Long term debt- due in more than one year 3,208,404 52,129,597 55,338,001
Total noncurrent liabilities 138,385,013 74,382,945 212,767,958
TOTAL LIABILITIES 152,637,145 91,919,716 244,556,861
DEFERRED INFLOWS OF RESOURCES
Deferred inflows related to pension 2,997,846 412,922 3,410,768
NET POSITION
Net investment in capital assets 37,408,295 62,764,524 100,172,819
Restricted for:
Community development projects 8,494,425 - 8,494,425
Public safety 340,721 - 340,721
Capital projects 5,827,173 - 5,827,173
Debt service 535,315 6,050,238 6,585,553
Rate stabilization - 10,941,541 10,941,541
Total restricted 15,197,634 16,991,779 32,189,413
Unrestricted (82,049,250) 39,335,644 (42,713,606)
TOTAL NET POSITION (29,443,321)$ 119,091,947$ 89,648,626$
Primary Government
City of Azusa
See accompanying Notes to Basic Financial Statements.23
City of Azusa
Statement of Activities
For the year ended June 30, 2020
Operating Capital
Charges for Grants and Grants and
Functions / Programs Expenses Services Contributions Contributions Total
Primary Government:
Governmental activities:
General government 14,858,996$ 7,609,852$ 265,417$ -$ 7,875,269$
Public safety 33,034,073 2,343,224 1,082,111 - 3,425,335
Community development 3,892,609 2,569,245 508,111 - 3,077,356
Parks and recreation 5,077,503 344,432 291,714 - 636,146
Public works 9,015,108 878,053 5,839,362 2,424,903 9,142,318
Interest on long-term debt (unallocated)225,826 - - - -
Total governmental activities 66,104,115 13,744,806 7,986,715 2,424,903 24,156,424
Business-type activities:
Water 24,608,822 24,348,594 - - 24,348,594
Light 36,579,394 39,975,498 - - 39,975,498
Sewer/Wastewater 2,705,943 3,292,951 - - 3,292,951
Refuse Contract 4,086,865 4,119,397 763,180 - 4,882,577
Total business-type activities 67,981,024 71,736,440 763,180 - 72,499,620
Total primary government 134,085,139$ 85,481,246$ 8,749,895$ 2,424,903$ 96,656,044$
General Revenues and Transfers:
Taxes:
Property taxes
Transient occupancy tax
Sales taxes
Franchise taxes
Business license tax
Utility users tax
Other taxes
Total taxes
Use of money and property
Other
Transfers
Total general revenues and transfers
Change in net position
Net position - beginning of year, as restated
Net position - end of year
Program Revenues
See accompanying Notes to Basic Financial Statements.24
Governmental Business-Type
Activities Activities Total
(6,983,727)$ -$ (6,983,727)$
(29,608,738) - (29,608,738)
(815,253) - (815,253)
(4,441,357) - (4,441,357)
127,210 - 127,210
(225,826) - (225,826)
(41,947,691) - (41,947,691)
- (260,228) (260,228)
- 3,396,104 3,396,104
- 587,008 587,008
- 795,712 795,712
- 4,518,596 4,518,596
(41,947,691) 4,518,596 (37,429,095)
12,520,153 - 12,520,153
765,096 - 765,096
6,817,957 - 6,817,957
7,059,663 - 7,059,663
2,067,693 - 2,067,693
3,267,346 - 3,267,346
1,488,465 - 1,488,465
33,986,373 - 33,986,373
859,705 1,221,072 2,080,777
1,086,770 - 1,086,770
2,607,313 (2,607,313) -
38,540,161 (1,386,241) 37,153,920
(3,407,530) 3,132,355 (275,175)
(26,035,791) 115,959,592 89,923,801
(29,443,321)$ 119,091,947$ 89,648,626$
and Changes in Net position
Net (Expense) Revenue
25
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26
FUND
FINANCIAL STATEMENTS
Governmental Fund Financial Statements
Proprietary Fund Financial Statements
Fiduciary Fund Financial Statements
27
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28
GOVERNMENTAL FUND FINANCIAL STATEMENTS
General Fund
General Fund is the general operating fund of the City. This fund accounts for all financial resources and
activities not required to be accounted for in other funds.
Fire Safety Special Revenue Fund
This fund is used to account for monies collected and restricted for fire safety activities.
Non-Major Governmental Funds
To account for other governmental programs funded by restricted or committed monies, and also to
account for debt service and capital project expenditures.
29
City of Azusa
Balance Sheet
Governmental Funds
June 30, 2020
Fire Safety Non-Major Total
General Special Revenue Governmental Governmental
Fund Fund Funds Funds
ASSETS
Pooled cash and investments 21,016,698$ 934,019$ 19,268,988$ 41,219,705$
Receivables:
Accounts 868,733 - 3,859,460 4,728,193
Taxes 3,417,744 - 17,355 3,435,099
Notes and loans 3,361 - 57,463 60,824
Accrued interest 44,295 - 16,985 61,280
Prepaid costs 33,861 - 6,666 40,527
Due from other funds 4,482,701 - - 4,482,701
Inventories 146,762 - - 146,762
Land held for resale 2,002,867 - - 2,002,867
Restricted assets:
Cash and investments with fiscal agents - - 3,007,388 3,007,388
Advances to Successor Agency 7,041,408 - - 7,041,408
Total assets 39,058,430$ 934,019$ 26,234,305$ 66,226,754$
LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCES
LIABILITIES
Accounts payable 748,349$ -$ 2,082,594$ 2,830,943$
Accrued liabilities 1,014,268 - 151,360 1,165,628
Unearned revenues 278,464 - 2,503,029 2,781,493
Deposits payable - - 16,207 16,207
Due to other governments 1,903 - - 1,903
Due to other funds - - 1,319,305 1,319,305
Advances from other funds 3,082,153 - - 3,082,153
Total liabilities 5,125,137 - 6,072,495 11,197,632
DEFERRED INFLOW OF RESOURCES
Unavailable revenues 32,840 - 1,519,927 1,552,767
Total deferred inflow of resources 32,840 - 1,519,927 1,552,767
FUND BALANCES
Nonspendable:
Inventories 146,762 - - 146,762
Prepaid costs 33,861 - 6,666 40,527
Land held for resale 2,002,867 - - 2,002,867
Notes and loans 3,361 - - 3,361
Advances to Successor Agency 7,041,408 - - 7,041,408
Restricted for:
Community development projects - - 8,494,425 8,494,425
Public safety - - 340,721 340,721
Capital projects - - 8,834,561 8,834,561
Debt service - - 535,315 535,315
Committed for:
Employee benefits - - 532,601 532,601
Public safety - 934,019 - 934,019
Unassigned 24,672,194 - (102,406) 24,569,788
Total fund balances 33,900,453 934,019 18,641,883 53,476,355
Total liabilities, deferred inflows
of resources, and fund balances 39,058,430$ 934,019$ 26,234,305$ 66,226,754$
See accompanying Notes to Basic Financial Statements.30
Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position
Total Fund Balances - Total Governmental Funds 53,476,355$
Capital assets used in governmental activities were not current
financial resources. Therefore, they were not reported in the
Governmental Funds Balance Sheet. Except for the internal service
funds reported below, the capital assets were adjusted as follows:
Government-
Wide
Statement of
Net Position
Internal
Service Funds
- Non-depreciable 7,005,324$ -$ 7,005,324
- Depreciable, net 31,604,930 550,961 31,053,969
Total capital assets 38,610,254$ 550,961$ 38,059,293
In the Government-Wide Financial Statements, certain differences
between actuarial estimates and actual results are deferred and
amortized over a period of time, however these differences do not
impact the Governmental Funds Balance Sheet
Government-
Wide
Statement of
Net Position
Internal
Service Funds
Deferred outflow of resources - OPEB 14,223,106$ -$
Deferred outflow of resources - pension 12,676,775 (439,246)
Deferred inflow of resources - pension (2,997,846) 66,552 23,529,341
Interest payable on long-term debt did not require current financial
resources. Therefore, interest payable was not reported as a liability in
Governmental Funds Balance Sheet.(27,841)
Deferred inflows of resources recorded in the Fund Financial
Statements resulting from activities in which revenues were earned but
funds were not available are reclassified as revenues in the
Government-Wide Financial Statements.1,552,767
Internal service funds were used by management to charge the costs of
certain activities, such as insurance, to individual funds. The assets
and liabilities of the internal service funds were included in
governmental activities in the Government-Wide Statement of Net
Position. (8,994,903)
Long-term liabilities were not due and payable in the current period.
Therefore, they were not reported in the Governmental Funds Balance
Sheet.
Wide
Statement of
Net Position
Internal
Service Funds
- Compensated absences - due within one year (2,576,081)$ 98,233$ (2,477,848)
- Claims and judgements - due within one year (3,207,959) 3,207,959 -
- Long term debt - due within one year (1,000,943) - (1,000,943)
- Due to Successor Agency (8,208,833)- (8,208,833)
- Total OPEB liability (60,597,750)- (60,597,750)
- Net pension liabilities (63,503,513)2,946,549 (60,556,964)
- Compensated absences - due in more than one year (1,079,131)91,540 (987,591)
- Claims and judgements - due in more than one year (1,787,382)1,787,382 -
- Long term debt - due in more than one year (3,208,404)- (3,208,404)
Total long-term liabilities (145,169,996)$ 8,131,663$ (137,038,333)
Net Position of Governmental Activities (29,443,321)$
June 30, 2020
Amounts reported for governmental activities in the Statement of Net
Position were different because:
City of Azusa
See accompanying Notes to Basic Financial Statements.31
City of Azusa
Statement of Revenues, Expenditures and Changes in Fund Balances
Governmental Funds
For the year ended June 30, 2020
Fire Safety Non-Major Total
General Special Revenue Governmental Governmental
Fund Fund Funds Funds
REVENUES:
Taxes 35,864,262$ -$ 3,069,788$ 38,934,050$
Assessments 2,547,233 - - 2,547,233
Licenses and permits 741,943 - 44,850 786,793
Intergovernmental 508,616 - 5,605,158 6,113,774
Charges for services 3,123,002 1,516,094 1,746,106 6,385,202
Use of money and property 1,087,499 - 484,960 1,572,459
Fines and forfeitures 1,383,846 - - 1,383,846
Contributions 3,936 - 75,804 79,740
Miscellaneous 1,134,024 - 12,966 1,146,990
Total revenues 46,394,361 1,516,094 11,039,632 58,950,087
EXPENDITURES:
Current:
General government 8,105,253 - 1,223,135 9,328,388
Public safety 19,822,431 6,954,085 422,644 27,199,160
Community development 2,193,739 - 1,225,786 3,419,525
Parks and recreation 3,453,630 - 531,202 3,984,832
Public works 847,051 - 3,781,204 4,628,255
Capital outlay 107,475 - 4,857,172 4,964,647
Debt service:
Principal retirement 42,553 - 425,000 467,553
Interest and fiscal charges 59,079 - 170,787 229,866
Total expenditures 34,631,211 6,954,085 12,636,930 54,222,226
REVENUES OVER (UNDER) EXPENDITURES 11,763,150 (5,437,991) (1,597,298) 4,727,861
OTHER FINANCING SOURCES (USES):
Transfers in 1,497,450 5,696,345 2,728,876 9,922,671
Transfers out (6,966,658) - (348,700) (7,315,358)
Proceeds from sale of capital assets 8,618 - - 8,618
Total other financing sources (uses)(5,460,590) 5,696,345 2,380,176 2,615,931
Net change in fund balances 6,302,560 258,354 782,878 7,343,792
FUND BALANCES:
Beginning of year, as restated 27,597,893 675,665 17,859,005 46,132,563
End of year 33,900,453$ 934,019$ 18,641,883$ 53,476,355$
See accompanying Notes to Basic Financial Statements.32
Reconciliation of the Governmental Funds Statement of Revenues, Expenditures and Changes
in Fund Balances to the Government-Wide Statement of Activities
For the year ended June 30, 2020
Net Change in Fund Balances - Total Governmental Funds 7,343,792$
Governmental funds reported additions of capital assets as capital outlay and program
expenditures. However, in the Government-Wide Statement of Activities, the cost of those assets
was allocated over their estimated useful lives as depreciation expense. This was the amount of
capital assets purchased in the current period.3,308,607
Depreciation expense on capital assets was reported in the Government-Wide Statement of
Activities and Changes in Net Position, but they did not require the use of current financial
resources. Therefore, depreciation expense was not reported as expenditures in governmental
funds.(1,888,928)
Disposals of capital assets are not reported in governmental funds, but in the Government-Wide
Statement of Activities, the loss on the disposal of capital assets is reported.(128,856)
Pension expense does not require the use of current financial resources, and therefore is not
reported as expenditures in goverrnmental funds.(12,383,124)
Employer contributions for pension were recorded as expenditures in the governmental funds.
However in the Government-Wide Financial Statements, these contributions are deferred 6,183,213
Revenues that have not met the revenue recognition criteria in the Fund Financial Statements are
recognized as revenue in the Government-Wide Statement of Activities.1,120,159
Long-term debt premium and discount was recorded as an other financing source or (use) in the
governmental funds, but the payment was treated as an increase (decrease) in long-term liabilities
and will be amortized over the life of the bonds in the Government-Wide Statement of Net Position 1,542
OPEB expense does not require the use of current financial resources, and therefore is not reported
as expenditures in governmental funds.(5,733,993)
Benefit payments are reported as expenditures in the governmental funds, however these
payments are reflected as reductions to the Total OPEB liability on the government-wide statement
of net position.1,217,150
Accrued vacation payable was an expenditure in governmental funds, but payoff of accrued leave
time decreased liabilities in the Government-Wide Statement of Net Position.(165,656)
Repayment of debt principal was an expenditure in governmental funds, but the repayment
reduced long-term liabilities in the Government-Wide Statement of Net Position. 467,553
Interest expense on long-term debt was reported in the Government-Wide Statement of Activities,
but they did not require the use of current financial resources. Therefore, interest expense was not
reported as expenditures in governmental funds. The following amount represented the change in
accrued interest from the prior year.2,500
Internal service funds were used by management to charge the costs of certain activities to
individual funds. The net revenue of the internal service funds was reported with governmental
activities.(2,751,489)
Change in Net Position of Governmental Activities (3,407,530)$
Amounts reported for governmental activities in the Statement of Activities were different because:
City of Azusa
See accompanying Notes to Basic Financial Statements.33
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34
PROPRIETARY FUND FINANCIAL STATEMENTS
Water Fund
To account for the costs of labor and material used in the maintenance, construction, and consumption of
water services within the City's water service area.
Light Fund
To account for the costs of labor and materials used in the maintenance, construction, and consumption of
electric services throughout the City.
Non-Major Enterprise Funds
To account for the costs of labor and materials used in the maintenance, construction, and consumption of
sewer and refuse services throughout the City.
Internal Service Funds
To account for the financing of goods or services provided by one deparment or agency to other
departments or agencies of the City and to other governmental units, on a cost-reimbursement basis.
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36
City of Azusa
Statement of Net Position
Proprietary Funds
June 30, 2020
Governmental
Non-Major Total Activities -
Water Light Enterprise Enterprise Internal Service
Fund Fund Funds Funds Funds
ASSETS
Current:
Cash and investments 29,538,878$ 20,737,644$ 6,768,108$ 57,044,630$ 223,424$
Receivables:
Accounts 2,633,073 3,874,441 993,791 7,501,305 990,161
Notes and loans - 40,000 - 40,000 139
Accrued interest - - 8,416 8,416 64,711
Prepaid costs 1,515 12,104 756 14,375 980,303
Inventories - 1,950,670 - 1,950,670 -
Restricted cash with fiscal agent 3,173,419 1,501,306 1,375,513 6,050,238 -
Restricted cash held for rate stabilization - 10,941,541 - 10,941,541 -
Total current assets 35,346,885 39,057,706 9,146,584 83,551,175 2,258,738
Noncurrent:
Advances to Successor Agency 2,616,012 - - 2,616,012 -
Advances to other funds 3,001,153 3,581,000 - 6,582,153 -
Capital assets - net of accumulated depreciation 76,920,292 30,640,604 8,451,256 116,012,152 1,578,956
Total noncurrent assets 82,537,457 34,221,604 8,451,256 125,210,317 1,578,956
Total assets 117,884,342 73,279,310 17,597,840 208,761,492 3,837,694
DEFERRED OUTFLOWS OF RESOURCES
Deferred charge on refunding 1,074,090 259,884 - 1,333,974 -
Deferred OPEB related items 299,434 149,717 - 449,151 299,434
Deferred pension related items 918,771 777,887 258,334 1,954,992 1,297,690
Total deferred outflows of resources 2,292,295 1,187,488 258,334 3,738,117 1,597,124
LIABILITIES
Current:
Accounts payable 5,317,476 1,337,192 719,925 7,374,593 710,580
Accrued liabilities 195,404 207,569 32,443 435,416 217,851
Accrued interest 963,419 60,659 - 1,024,078 -
Deposits payable 1,429,134 2,425,338 53 3,854,525 -
Unearned revenue - 35,158 - 35,158 -
Due to other governments 14,378 10,565 - 24,943 -
Due to other funds - - - - 3,163,396
Compensated absences - due within one year 347,725 334,766 89,529 772,020 348,974
Claims and judgements - due within one year - - - - 3,207,959
Bonds and notes payable - due within one year 2,210,000 845,000 425,000 3,480,000 -
Total current liabilities 10,477,536 5,256,247 1,266,950 17,000,733 7,648,760
Noncurrent:
Advances from other funds 3,500,000 - - 3,500,000 -
Compensated absences - due in more than one year 159,363 265,880 - 425,243 133,239
Bonds and notes payable - due in more than one year 47,014,698 2,749,899 2,365,000 52,129,597 -
Claims and judgements - due in more than one year - - - - 1,787,382
Total OPEB liability 1,275,742 637,873 - 1,913,615 1,275,742
Net pension liability 6,112,196 5,076,098 1,756,623 12,944,917 8,598,681
Total noncurent liabilities 58,061,999 8,729,750 4,121,623 70,913,372 11,795,044
Total liabilities 68,539,535 13,985,997 5,388,573 87,914,105 19,443,804
DEFERRED INFLOWS OF RESOURCES
Deferred pension related items 136,734 110,986 40,286 288,006 191,468
Total deferred inflows of resources 136,734 110,986 40,286 288,006 191,468
NET POSITION
Net investment in capital assets 28,769,684 27,305,589 5,661,256 61,736,529 1,578,956
Restricted for debt service 3,173,419 1,501,306 1,375,513 6,050,238 -
Restricted for rate stabilization - 10,941,541 - 10,941,541 -
Unrestricted 19,557,265 20,621,379 5,390,546 45,569,190 (15,779,410)
Total net position 51,500,368$ 60,369,815$ 12,427,315$ 124,297,498 (14,200,454)$
Reconciliation of net position to the Business-Type Activities Statement of Net Position
Prior years' accumulated adjustment to reflect the consolidation of
internal service funds' activities related to the enterprise funds (3,740,798)
Current years' adjustments to reflect the consolidation of internal
service activities related to enterprise funds (1,464,753)
Net position per Business-Type Activities Statement of Net Position 119,091,947$
Business-Type Activities - Enterprise Funds
See accompanying Notes to Basic Financial Statements.37
City of Azusa
Statement of Revenues, Expenses and Changes in Fund Net Position
Proprietary Funds
For the year ended June 30, 2020
Non-Major Total Internal
Water Light Enterprise Enterprise Service
Fund Fund Funds Funds Funds
OPERATING REVENUES:
Sales and service charges 23,804,558$ 37,964,988$ 7,412,347$ 69,181,893$ 10,270,309$
Interdepartmental charges 506,868 515 - 507,383 -
Miscellaneous 26,168 - 1 26,169 257,937
Other restricted revenues - 2,009,995 - 2,009,995 -
Lease revenue 11,000 - - 11,000 -
Total operating revenues 24,348,594 39,975,498 7,412,348 71,736,440 10,528,246
OPERATING EXPENSES:
Administration and general 6,793,787 10,235,297 1,196,618 18,225,702 10,076,850
Source of supply 2,787,600 16,415,384 - 19,202,984 429,507
Pumping - - - - -
Transmission/collection 2,364,232 4,183,532 - 6,547,764 -
Treatment 1,400 - 782,523 783,923 -
Refuse collection - - 3,977,345 3,977,345 -
Cost of sales and services 6,416,836 39,530 - 6,456,366 -
Claims expense - - - - 3,782,097
Depreciation expense 3,811,721 1,334,443 489,347 5,635,511 121,159
Total operating expenses 22,175,576 32,208,186 6,445,833 60,829,595 14,409,613
OPERATING INCOME (LOSS)2,173,018 7,767,312 966,515 10,906,845 (3,881,367)
NONOPERATING REVENUES (EXPENSES):
Taxes - - 763,180 763,180 -
Interest revenue 548,344 550,712 122,016 1,221,072 -
Interest expense (1,766,514) (121,243) (59,523) (1,947,280) -
Intergovermernmental - - - - 19,024
Special franchise fees (443,650) (3,579,745) (66,229) (4,089,624) -
Loss on disposal of capital assets - - - - (6,180)
Gain on disposal of capital assets 326 - - 326 2,183
Total nonoperating revenues (expenses)(1,661,494) (3,150,276) 759,444 (4,052,326) 15,027
INCOME (LOSS) BEFORE TRANSFERS 511,524 4,617,036 1,725,959 6,854,519 (3,866,340)
Transfer in - - - - 132,335
Transfer out (739,584) (584,407) (933,420) (2,257,411) (482,237)
Change in net position (228,060) 4,032,629 792,539 4,597,108 (4,216,242)
Net position:
Beginning of year 51,728,428 56,337,186 11,634,776 119,700,390 (9,984,212)
End of year 51,500,368$ 60,369,815$ 12,427,315$ 124,297,498$ (14,200,454)$
Reconciliation of change in net position to the Business-Type Activities Statement of Activities
Change in net position per Statement of Net Position - Proprietary Funds 4,597,108$
Current years' adjustments to reflect the consolidation of internal
service activities related to enterprise funds (1,464,753)
Change in net position per Business-Type Activities Statement of Net Pos 3,132,355$
Business-Type Activities - Enterprise Funds
38
City of Azusa
Statement of Cash Flows
Proprietary Funds
For the year ended June 30, 2020
Governmental
Non-Major Total Activities -
Water Light Enterprise Enterprise Internal Service
Fund Fund Funds Funds Funds
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers and users 24,475,135$ 40,328,950$ 7,384,092$ 72,188,177$ 9,915,228$
Cash received from/(paid to) interfund service provided 506,868 515 - 507,383 -
Cash paid to suppliers for goods and services (15,061,768) (27,591,605) (5,094,255) (47,747,628) (8,890,860)
Cash paid to employees for services (2,026,921) (2,645,920) (631,746) (5,304,587) (3,431,469)
Net cash provided by (used in) operating activities 7,893,314 10,091,940 1,658,091 19,643,345 (2,407,101)
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Cash disbursed to other funds (739,584) (584,407) (933,420) (2,257,411) (349,902)
Cash received from other funds 3,500,000 - - 3,500,000 1,884,244
Cash received from grants - - 540,044
Net cash provided by noncapital financing activities 2,760,416 (584,407) (933,420) 1,242,589 2,074,386
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
Acquisition and construction of capital assets (6,648,231) (4,284,473) - (10,932,704) (941,524)
Principal paid on capital debt (2,120,000) (820,000) (415,000) (3,355,000) -
Interest paid on capital debt (1,969,253) (127,895) (59,523) (2,156,671) -
Special franchise fees paid (443,650) (3,579,745) (66,229) (4,089,624) -
Repayment made for advances - (3,500,000) - (3,500,000) -
Taxes - - 763,180 763,180 -
Proceeds from sale of capital assets 326 - - 326 2,183
Net cash provided by (used in) capital and related financing activities (11,180,808) (12,312,113) 222,428 (23,270,493) (939,341)
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest received 548,344 550,712 139,815 1,238,871 210,848
Net cash provided by (used in) investing activities 548,344 550,712 139,815 1,238,871 210,848
Net increase (decrease) in cash and cash equivalents 21,266 (2,253,868) 1,086,914 (1,145,688) (1,061,208)
CASH AND CASH EQUIVALENTS:
Beginning of year 32,691,031 35,434,359 7,056,707 75,182,097 1,284,632
End of year 32,712,297$ 33,180,491$ 8,143,621$ 74,036,409$ 223,424$
FINANCIAL STATEMENT PRESENTATION:
Cash and investments 29,538,878$ 20,737,644$ 6,768,108$ 57,044,630 223,424$
Cash with fiscal agent 3,173,419 1,501,306 1,375,513 6,050,238 -
Cash held for rate stabilization - 10,941,541 - 10,941,541 -
Total 32,712,297$ 33,180,491$ 8,143,621$ 74,036,409$ 223,424$
RECONCILIATION OF OPERATING INCOME TO NET
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:
Operating income (loss)2,173,018$ 7,767,312$ 966,515$ 10,906,845$ (3,881,367)$
Adjustments to reconcile operating income (loss) to net
cash provided by (used in) operating activities:
Depreciation 3,811,721 1,334,443 489,347 5,635,511 121,159
Changes in current assets and liabilities:
(Increase) decrease in accounts receivable 129,949 (42,404) (28,309) 59,236 (613,018)
(Increase) decrease in inventories - (14,545) - (14,545) -
(Increase) decrease in prepaid expense 6,387 80,865 (246) 87,006 (402,310)
(Increase) decrease in deferred OPEB related outflows (210,503) (105,251) - (315,754) (210,503)
(Increase) decrease in deferred pension related outflows 171,527 175,252 36,676 383,455 252,688
Increase (decrease) in accounts payable 1,051,423 (4,460) 11,935 1,058,898 50,757
Increase (decrease) in accrued liabilities (489,258) 1,494 (4,614) (492,378) 30,145
Increase (decrease) in deposits payable 503,460 396,371 53 899,884 -
Increase (decrease) in due to other governments 3,045 (882) - 2,163 -
Increase (decrease) in claims and judgements - - - - 1,417,327
Increase (decrease) in compensated absences 37,401 107,765 37,802 182,968 (8,902)
Increase (decrease) in total OPEB liability 305,594 152,797 - 458,391 305,594
Increase (decrease) in net pension liability 446,108 313,853 149,999 909,960 607,934
Increase (decrease) in deferred pension related inflows (46,558) (70,670) (1,067) (118,295) (76,605)
Total adjustments 5,720,296 2,324,628 691,576 8,736,500 1,474,266
Net cash provided by (used in) by operating activities 7,893,314$ 10,091,940$ 1,658,091$ 19,643,345$ (2,407,101)$
NONCASH INVESTING, CAPITAL, AND FINANCING ACTIVITIES:
Amortization of premiums (233,314)$ (13,298)$ -$ (246,612)$ -$
Amortization of deferred charge on refunding 67,414 18,563 - 85,977 -
Business-Type Activities - Enterprise Funds
See accompanying Notes to Basic Financial Statements.39
FIDUCIARY FUND FINANCIAL STATEMENTS
Resources held and administered by the City when acting in a fiduciary capacity for other organizations
or governments are accounted for in fiduciary funds. The activities of these funds are excluded from the
government-wide financial statements. The City's reports activity in the following fiduciary funds:
RDA Successor Agency Private Purpose Trust Funds
To account for property taxes that would have been redevelopment property tax increment had the
Redevelopment Agency not been dissolved. The property taxes are distributed semi-annually by the
County Auditor-Controller's Office and are used to pay enforceable obligations and Successor Agency
administrative costs. This fund also accounts for all non-housing assets transferred from the dissolved
Redevelopment Agency.
Agency Fund
To account for assets held by the City as trustee or agent for individuals, private organizations, and other
governmental agencies.
40
City of Azusa
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2020
Private Purpose
Trust Fund
RDA
Agency Successor
Fund Agency Fund
ASSETS
Pooled cash and investments 4,161,872$ 3,958,176$
Receivables:
Accounts 414,909 -
Taxes 113,148 -
Notes and loans - 36,863
Advances to City - 8,208,833
Land held for resale - 6,786,378
Restricted:
Cash and investments with fiscal agents 12,340,741 33,829
Capital assets:
Capital assets, not being depreciated - 410,420
Capital assets, net of accumulated depreciation - 843,315
Total assets 17,030,670$ 20,277,814
DEFERRED OUTFLOWS OF RESOURCES
Deferred charge on refunding 2,708,535
Total deferred outflows of resources 2,708,535
LIABILITIES
Accounts payable 213,447$ 158,446
Accrued liabilities 981 -
Accrued interest - 635,533
Deposits payable 16,816,242 -
Due to other governments - -
Long-term liabilities:
Due in one year - 2,050,000
Due in more than one year - 39,333,423
Due to City of Azusa - 9,657,420
Total liabilities 17,030,670$ 51,834,822
NET POSITION
Held in trust for other purposes (28,848,473)
Total net position (28,848,473)$
See accompanying Notes to Basic Financial Statements.41
City of Azusa
Statement of Changes in Fiduciary Net Position
Fiduciary Funds
For the year ended June 30, 2020
Private-Purpose
Trust Fund
RDA Successor
Agency Fund
ADDITIONS:
Taxes 4,598,833$
Interest and change in fair value of investments 3,410
Proceeds from sale of assets 181,758
Total additions 4,784,001
DEDUCTIONS:
Administration expenses 20,414
Contractual services 22,148
Interest expense 1,838,444
Depreciation expense 129,152
Loss on sale of assets (75,456)
Contributions to other governments 659,365
Total deductions 2,594,067
Change in net position 2,189,934
Net position:
Beginning of year (31,038,407)
End of year (28,848,473)$
See accompanying Notes to Basic Financial Statements.42
43
NOTES TO BASIC
FINANCIAL STATEMENTS
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
44
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The basic financial statements of the City of Azusa, California (City) have been prepared in conformity with
generally accepted accounting principles (GAAP) as applied to governmental agencies. The Governmental
Accounting Standards Board (GASB) is the accepted standard setting body for establishing governmental
accounting and financial reporting principles. The more significant of the City’s accounting policies are
described below.
A. Financial Reporting Entity
The City of Azusa (City) was incorporated as a general law city in September 29, 1898. The City operates
under the Council-Manager form of government and provides the following services: public safety, light,
sewer/wastewater, water, recreation, public improvements, planning and zoning, building inspections,
and general administration services.
These basic financial statements present the City and its component units, entities for which the City is
considered to be financially accountable. Blended component units, although legally separate entities are,
in substance, part of the City’s operations and data from these units are combined with data of the City.
All of the City’s component units are considered to be blended component units, although legally separate
entities, are, in substance, part of the City’s operation and so data from these are reported with interfund
data of the City. The blended component unit has a June 30 year-end. The following entity is reported as
a blended component unit:
Azusa Public Financing Authority (Authority) was established solely to provide financing to the City
of Azusa for specified projects. The governing board of the Authority is composed of the same
individuals that serve as council members for the City of Azusa. Upon completion, separate financial
statements of the Authority can be obtained at City Hall.
Azusa Industrial Development Authority (Authority) was established to promote industrial and
commercial expansion and development within the City of Azusa. The governing board of the
Authority is composed of the same individuals that serve as council members for the City of Azusa.
Separate financial statements are not prepared by the Authority because it has no activity to report.
The Authority is financially interdependent and provides financial benefit/burden to the City.
B. Basis of Accounting and Measurement Focus
The accounts of the City are organized on the basis of funds, each of which is considered a separate
accounting entity with its own self-balancing set of accounts that comprise its assets, deferred outflows
of resources, liabilities, fund equity, revenues and expenditures or expenses. These funds are established
for the purpose of carrying out specific activities or certain objectives in accordance with specific
regulations, restrictions or limitations. Governmental resources are allocated to and accounted for in
individual funds based upon the purposes for which they are to be spent and the means by which
spending activities are controlled.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
45
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
B. Basis of Accounting and Measurement Focus, Continued
Government-Wide Financial Statements
The City’s Government-Wide Financial Statements include a Statement of Net Position and a Statement
of Activities. These statements present summaries of Governmental and Business-Type Activities for the
City accompanied by a total column.
These financial statements are presented on an “economic resources” measurement focus and the accrual
basis of accounting. Accordingly, all of the City’s assets and liabilities, including capital assets, as well as
infrastructure assets, and long-term liabilities, are included in the accompanying Statement of Net
Position. The Statement of Activities presents changes in net position. Under the accrual basis of
accounting, revenues are recognized in the period in which they are earned while expenses are recognized
in the period in which the liabilities are incurred.
Certain types of transactions reported as program revenues for the City are reported in three categories:
Charges for services
Operating grants and contributions
Capital grants and contributions
Certain eliminations have been made in regards to interfund activities, payables, and receivables. All
internal balances in the Statement of Net Position have been eliminated except those representing
balances between the governmental activities and the business-type activities, which are presented as
internal balances and eliminated in the total primary government column. In the Statement of Activities,
internal fund transactions have been eliminated, except for interdepartmental service charges and those
transactions between governmental and business-type activities. The following interfund activities have
been eliminated:
Due to/from other funds
Transfers in/out
The City applies all applicable GASB pronouncements including all NCGA Statements and
Interpretations currently in effect.
Government Fund Financial Statements
Governmental fund financial statements include a Balance Sheet and a Statement of Revenues,
Expenditures and Changes in Fund Balances for all major governmental funds and non-major funds
aggregated. An accompanying schedule is presented to reconcile and explain the differences in net
position as presented in these statements to the net position presented in the government-wide financial
statements. The City has presented all major funds that meet specific qualifications.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
46
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
B. Basis of Accounting and Measurement Focus, Continued
Government Fund Financial Statements, Continued
All governmental funds are accounted for on a spending or “current financial resources” measurement
focus and the modified accrual basis of accounting. Accordingly, only current assets and current liabilities
are included on the balance sheets. The Statement of Revenues, Expenditures and Changes in Fund
Balances present increases (revenues and other financing sources) and decreases (expenditures and other
financing uses) in net current assets. Under the modified accrual basis of accounting, revenues are
recognized in the accounting period in which they become both measurable and available to finance
expenditures of the current period.
The City reports the following funds as major governmental funds of the City.
General Fund accounts for resources traditionally associated with governmental activities that are not
required legally or by sound financial management to be accounted for in another fund.
Fire Safety Special Revenue Fund accounts for fees that are restricted for fire safety activities. In addition,
the activities are also supplemented by general fund monies that are committed for the fund’s
purpose.
The City reports the following funds as non-major governmental funds of the City.
Special Revenue Funds accounts for revenues which are restricted for specific purposes.
Capital Project Funds accounts for financial resources to be used for the acquisition or construction of
major capital improvement as outlined in the City’s Capital Improvement Program.
Debt Service Funds account for the accumulation of resources and payment of long-term debt.
Revenues are considered to be available when they are collectible within the current period or soon
enough thereafter to pay liabilities of the current period. For this purpose, the City considered revenues
to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures
generally are recorded when a liability is incurred, as under accrual accounting. However, debt service
expenditures, as well as expenditures related to compensated absences and claims and judgements, are
recorded only when payment is due.
Property taxes, franchise taxes, licenses and interest associated with the current fiscal period are all
considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal
period. Only the portion of special assessments receivable due within the current fiscal period is
considered to be susceptible to accrual as revenue of the current period. All other revenue items are
considered to be measureable and available only when cash is received by the government.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
47
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
B. Basis of Accounting and Measurement Focus, Continued
Government Fund Financial Statements, Continued
Expenditures of the Governmental Funds are classified by function. Functional classifications are defined
as follows:
General Government includes legislative activities which have a primary objective of providing legal
and policy guidelines for the City. Also included in this classification are those activities which
provide management or support services across more than one functional area, including Library
Services.
Public Safety includes those activities which involve the protection of people and property.
Community Development includes those activities which involve the enhancing of the general quality
of life.
Parks and Recreation includes those activities which involve community park maintenance and
recreational activities within the community.
Public Works includes those activities which involve the maintenance and improvement of City streets
and roads.
Debt Service includes those activities that account for the payment of long-term debt principal, interest
and fiscal charges.
The Reconciliation of the Fund Financial Statements to the Government-Wide Financial Statements is
provided.
Proprietary Fund Financial Statements
Proprietary fund financial statements include a Statement of Net Position, a Statement of Revenues,
Expenses and Change in Net Position, and a Statement of Cash Flows for all proprietary funds.
A column representing internal service funds is also presented in these statements. However, internal
service balances and activities have been combined with the governmental activities in the Government-
Wide Financial Statements, except for the Consumer Services Internal Service Fund, which is combined
with business-type activities.
Proprietary funds are accounted for using the “economic resources” measurement focus and the accrual
basis of accounting. Accordingly, all assets and liabilities (whether current or noncurrent) are included
on the Statement of Net Position. The Statement of Revenues, Expenses and Changes in Fund Net Position
present increases (revenues) and decreases (expenses) in total net position. Under the accrual basis of
accounting, revenues are recognized in the period in which they are earned while expenses are recognized
in the period in which a liability is incurred.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
48
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
B. Basis of Accounting and Measurement Focus, Continued
Proprietary Fund Financial Statements, Continued
Operating revenues in the proprietary funds are those revenues that are generated from the primary
operations of the fund. All other revenues are reported as non-operating revenues. Operating expenses
are those expenses that are essential to the primary operations of the fund. All other expenses are reported
as non-operating expenses.
The City reports the following funds as major proprietary funds of the City.
Water Fund accounts for the costs of labor and materials used in the maintenance, construction, and
consumption of water services within the City’s water service area.
Light Fund accounts for the costs of labor and materials used in the maintenance, construction and
consumption of electric services throughout the City.
Internal service fund balances and activities have been combined with governmental and business-type
activities in the Government-Wide Financial Statements. These funds account for consumer services, self
insurance, central services, equipment replacement, and I.T. services.
Fiduciary Fund Financial Statements
Fiduciary fund financial statements consist of a Statement of Fiduciary Net Position and a Statement of
Changes in Fiduciary Net Position. The City reports two types of fiduciary funds which are a private-
purpose trust fund and an Agency Fund. Private-purpose trust funds account for resources of all other
trust arrangements in which principal and income benefit individuals, private organizations, or other
governments (i.e. unclaimed property/escheat property). Agency funds account for assets held by the
City as trustee or agent for individuals, private organizations, and other governmental units. Fiduciary
funds are accounted for using the accrual basis of accounting. The City reports the following fiduciary
funds:
Successor Agency to the Redevelopment Agency Private Purpose Trust Fund - accounts for the accumulation
of resources to be used for payments at appropriate amounts and times in the future.
Agency Funds – accounts for various deposits made by individuals, private organizations, or other
governments.
The financial activities of the funds are excluded from the Government-wide financial statements, but are
presented in the separate Fiduciary Fund financial statements.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
49
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
C. Cash, Cash Equivalents and Investments
The City pools cash resources from all funds in order to facilitate the management of cash. The balance
in the pooled cash account is available to meet current operating requirements. Cash in excess of current
requirements is invested in various interest-bearing accounts and other investments for varying terms.
In accordance with GASB Statement No. 40, Deposit and Investment Disclosures (Amendment of GASB No.
3), certain disclosure requirements for Deposits and Investment Risks were made in the following areas:
• Interest Rate Risk
• Credit Risk
o Overall
o Custodial Credit Risk
o Concentrations of Credit Risk
In addition, other disclosures are specified including use of certain methods to present deposits and
investments, highly sensitive investments, credit quality at year-end, and other disclosures.
In accordance with GASB Statement No. 31, Accounting and Financial Reporting for Certain Investments and
for External Investment Pools, highly liquid market investments with maturities of one year or less at time
of purchase are stated at amortized cost. All other investments are stated at fair value. The City
categorizes the fair value measurements of its investments based on the hierarchy established by
generally accepted accounting principles. The fair value hierarchy, which has three levels, is based on the
valuation inputs used to measure an asset’s fair value: Level 1 inputs are quoted prices in active markets
for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant
unobservable inputs. The City does not have any investments that are measured using Level 1 and 3
inputs.
The City participates in an investment pool managed by the State of California entitled Local Agency
Investment Fund (LAIF) which has invested a portion of the pooled funds in Structured Notes and Asset-
Backed Securities. LAIF’s investments are subject to credit risk with the full faith and credit of the State
of California collateralizing these investments. In addition, these Structured Notes and Asset-Backed
Securities are subject to market risk as to the change in interest rates.
Cash equivalents are considered amounts in demand deposits and short-term investments with a
maturity date within three months of the date acquired by the City and are presented as “Cash and
Investments” in the accompanying Basic Financial Statements.
For the purpose of the statement of cash flows, the City considers and cash equivalents because
investments meet the criteria for cash equivalents defined above. all pooled cash and investments
(consisting of cash and investments and restricted cash and investments) held by the City as cash and
cash equivalents because the pool is used essentially as a demand deposit account from the standpoint of
the funds. The City also considers all non-pooled cash and investments (consisting of cash with fiscal
agent and restricted cash and investments held by fiscal agent) as cash.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
50
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
D. Restricted Cash and Investments
Certain proceeds of debt issues, as well as certain resources set aside for their repayment, are classified as
restricted assets on the balance sheet because their use is limited by applicable bond covenants.
E. Inventories, Prepaid Costs, and Land Held for Resale
All inventories are valued at cost using the first-in/first-out (FIFO) method. Inventory costs are recorded
as an expense when used. Certain payments to vendors reflect costs applicable to future accounting
periods and are recorded as prepaid items in both government-wide and fund financial statements. Land
purchased for resale is capitalized as inventory at acquisition costs or net realizable value, if lower.
F. Capital Assets
Capital assets, which include property, plant, equipment, and infrastructure assets (e.g. roads, bridges,
sidewalks, and similar items), are reported in the applicable governmental or business-type activities
columns in the government-wide financial statements. Capital assets are defined by the City as assets
with an initial, individual cost of more than $5,000 (amount not rounded), and an estimated useful life in
excess of two years. Such assets are recorded at historical cost or estimated historical cost if purchased or
constructed. Donated capital assets are recorded at acquisition value at the date of donation.
In accordance with GASB Statement No. 34, the City has reported general infrastructure assets acquired
in the current year and retroactively reported prior year’s acquisitions prior to fiscal years ended after
June 30, 1980.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend
the useful life are not capitalized.
Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest
incurred during the construction phase of the capital assets of business-type activities is included as part
of the capitalized value of the assets constructed.
Property, plant, and equipment of the primary government, as well as the component units, are
depreciated using the straight-line method over the following estimated useful lives:
Land Improvements 20 years
Buildings and Improvements 30– 50 years
Machinery and Equipment 8 – 30 years
Automobiles and Trucks 5 – 15 years
Infrastructure 30–65 years
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
51
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
G. Interest Payable
In the Government-Wide Financial Statements, interest payable on long-term debt is recognized as the
liability is incurred for governmental fund types and proprietary fund types.
In the Fund Financial Statements, proprietary fund types recognize the interest payable when the liability
is incurred.
H. Unearned revenue
Unearned revenue is recognized for transactions for which revenue has not yet been earned. Typical
transactions recorded as unearned revenues in the Government-Wide Financial Statements are prepaid
charges for services.
I. Claims and Judgments
The City records a liability for litigation, judgments, and claims when it is probable that an asset has been
impaired or a liability has been incurred prior to year-end and the probable amount of loss (net of any
insurance coverage) can be reasonably estimated. Claims incurred but not reported are recorded as a
liability when the liability has been incurred or an asset has been impaired and the amounts can be
reasonably determined. This liability is recorded in the internal service fund that accounts for the City’s
self-insurance activities.
J. Long-Term Debt
In the government-wide financial statements, proprietary fund types fund financial statements, and
private purpose trust fund financial statements, long-term debt and other long-term obligations are
reported as liabilities in the governmental activities, business-type activities, proprietary fund types
statement of net position, or private purpose fund types statement of net position. Bond premiums and
discounts are deferred and amortized over the life of the bonds using the effective interest method. Bonds
payable are reported net of the applicable bond premium or discount. Bond issuance costs are no longer
reported as deferred charges and amortized over the term of the related debt. Debt issuance costs should
be recognized in the period incurred.
In the fund financial statements, governmental fund types recognize bond premiums and discounts
during the current period. The face amount of debt issued is reported as other financing sources. Bond
issuance costs are expensed in the year incurred. Premiums received on debt issuances are reported as
other financing sources while discounts on debt issuances are reported as other financing uses. Issuance
costs, whether or not withheld from the actual debt proceeds received, are reported as debt service
expenditures.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
52
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
K. Property Taxes
Property tax revenue is recognized in the fiscal year for which the taxes have been levied providing they
become available. Available means then due, or past due, and receivable within the current period or
expected to be collected soon thereafter (not to exceed 60 days) to be used to pay liabilities of the current
period. The County of Los Angeles collects property taxes for the City tax liens attach annually as of 12:01
A.M. on the first day in January proceeding the fiscal year for which the taxes are levied. The tax levy
covers the fiscal period July 1 to June 30. All secured personal property taxes and one-half of the takes on
real property are due November 1; the second installment is due February 1. All taxes are delinquent, if
unpaid, on December 10 and April 10 respectively. Unsecured personal property taxes become due on
the first of March each year and are delinquent on August 31.
L. Deferred Outflows/Inflows of Resources
In addition to assets, the statement of net position or balance sheet will sometimes report a separate
section for deferred outflows of resources. This separate financial statement element, deferred outflows
of resources, represents a consumption of net position that applies to a future period(s) and so will not be
recognized as an outflow of resources (expense/ expenditure) until then.
In addition to liabilities, the statement of net position or balance sheet will sometimes report a separate
section for deferred inflows of resources. This separate financial statement element, deferred inflows of
resources, represents an acquisition of net position that applies to a future period(s) and so will not be
recognized as an inflow of resources (revenue) until that time.
M. Net Position
Net Position is the excess of all the City's assets and deferred outflow of resources over all its liabilities
and deferred inflows of resources, regardless of fund. Net Position is divided into three captions under
GASB Statement 34. These captions apply only to Net Position, which is determined only at the
Government-wide and proprietary funds level, and are described below:
Net investment in capital assets, describes the portion of Net Position which is represented by the current
net book value of the City's capital assets, less the outstanding balance of any debt issued to finance
these assets.
Restricted describes the portion of Net Position which is restricted as to use by the terms and conditions
of agreements with outside parties, governmental regulations, laws, or other restrictions which the
City cannot unilaterally alter. These principally include developer fees received for use on capital
projects, debt service requirements, and other restrictions imposed by laws and regulations.
Unrestricted describes the portion of Net Position which is not restricted to use.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
53
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
N. Fund Balances
Governmental fund balances represent the net current assets of each fund. Net current assets generally
represent a fund's cash and receivables, less its liabilities.
The City's fund balances are classified in accordance with Governmental Accounting Standards Board
Statement Number 54 (GASB 54), Fund Balance Reporting and Governmental Fund Type Definitions, which
requires the City to classify its fund balances based on spending constraints imposed on the use of
resources. For programs with multiple funding sources, the City prioritizes and expends funds in the
following order: Restricted, Committed, Assigned, and Unassigned. The City Council, through
resolution, is able to commit funds for specific purposes. Each category in the following hierarchy is
ranked according to the degree of spending constraint:
Nonspendable represents balances set aside to indicate items do not represent available, spendable
resources even though they are a component of assets. Fund balances required to be maintained intact,
such as Permanent Funds, and assets not expected to be converted to cash, such as prepaids, notes
receivable, and land held for resale are included. However, if proceeds realized from the sale or
collection of nonspendable assets are restricted, committed or assigned, then nonspendable amounts
are required to be presented as a component of the applicable category.
Restricted fund balances have external restrictions imposed by creditors, grantors, contributors, laws,
regulations, or enabling legislation which requires the resources to be used only for a specific purpose.
Encumbrances and nonspendable amounts subject to restrictions are included along with spendable
resources.
Committed fund balances have constraints imposed by formal action of the City Council (Resolution)
which may be altered only by formal action by Resolution of the City Council. Encumbrances and
nonspendable amounts subject to Council commitments are included along with spendable resources.
Committed fund balance also should incorporate contractual obligations to the extent that existing
resources in the fund have been specifically committed for use in satisfying those contractual
requirements. City Council action to commit fund balance needs to occur within the fiscal reporting
periods; however, the amount can be determined subsequently.
Assigned fund balances are amounts constrained by the City's intent to be used for a specific purpose,
but are neither restricted nor committed. The policy hereby delegates the authority to assign amounts
to be used for specific purposes to the Administrative Services Director/Chief Financial Officer for
the purpose of reporting. This category includes encumbrances when applicable.
Unassigned fund balance represents residual amounts that have not been restricted, committed, or
assigned. This includes the residual general fund balance and residual fund deficits, if any, of other
governmental funds.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
54
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
O. Net Position Flow Assumption
Sometimes the government will fund outlays for a particular purpose from both restricted (e.g., restricted
bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as
restricted – net position and unrestricted – net position in the government-wide and proprietary fund
financial statements, a flow assumption must be made about the order in which the resources are
considered to be applied. It is the government’s policy to consider restricted – net position to have been
depleted before unrestricted – net position is applied.
P. Fund Balance Flow Assumptions
Sometimes the government will fund outlays for a particular purpose from both restricted and
unrestricted resources (the total of committed, assigned, and unassigned fund balance). In order to
calculate the amounts to report as restricted, committed, assigned, and unassigned fund balance in the
governmental fund financial statements a flow assumption must be made about the order in which the
resources are considered to be applied. It is the government’s policy to consider restricted fund balance
to have been depleted before using any of the components of unrestricted fund balance. Further, when
the components of unrestricted fund balance can be used for the same purpose, committed fund balance
is depleted first, followed by assigned fund balance. Unassigned fund balance is applied last.
Q. Use of Estimates
The accompanying basic financial statements have been prepared on the modified accrual basis of
accounting in accordance with generally accepted accounting principles. This requires management to
make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of
the financial statements and the reported amounts of revenues and expenditures during the reporting
period. Actual results could differ from those estimates.
R. Compensated Absences
In accordance with GASB Statement No. 16, a liability is recorded for unused vacation and similar
compensatory leave balances since the employees' entitlement to these balances are attributable to
services already rendered and it is probable that virtually all of these balances will be liquidated by either
paid time off or payments upon termination or retirement. Under GASB Statement No. 16, a liability is
recorded for unused sick leave balances to the extent that it is probable that the unused balances will
result in termination payments. Generally, vacation, sick leave and compensatory absences vest and are
recorded as the obligation is incurred. If material, a proprietary fund liability is accrued for all earned but
unused leave benefits relating to the operations of the proprietary funds. A current liability is accrued in
the governmental funds for material leave benefits due on demand to governmental fund employees that
have terminated prior to year-end. These non-current amounts will be recorded as fund expenditures in
the year in which they are paid or become due on demand to terminated employees.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
55
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
S. Pension
For purposes of measuring the net pension liability and deferred outflows/inflows of resource related to
pensions, and pension expense, information about the fiduciary net position of the City of Azusa’s
California Public Employees’ Retirement System (CalPERS) plans and the PARS Retirement Enhancement
Plan (Plans) and additions to/deductions from the Plans’ fiduciary net position have been determined on
the same basis as they are reported by CalPERS and PARS. 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. For this report, the following timeframes are used:
Valuation Date June 30, 2018
Measurement Date June 30, 2019
Measurement Period July 1, 2018 to June 30, 2019
T. Other Postemployment Benefits Other Than Pensions (OPEB)
For purpose of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of
resources related to OPEB, and OPEB expense, information about the fiduciary net position of the City of
Azusa Retiree Benefits Plan (the Plan) and additions to/deductions from the Plan’s fiduciary net positon
have been determined on the same basis as they are reported by the Plan. For this purpose, the Plan
recognizes benefit payments when due and payable in accordance with the benefit terms. 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. For this report, the following timeframes are used:
Valuation Date June 30, 2018
Measurement Date June 30, 2020
Measurement Period July 1, 2019 to June 30, 2020
U. New Pronouncements
In 2020, the City did not adopt any new accounting standards.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
56
2. CASH AND INVESTMENTS
A. Summary of Cash and Investments
The City maintains a cash and investments pool for all funds. Certain restricted funds that are held and
invested by independent outside custodians through contractual agreements are not pooled. These
restricted funds include cash and investments held by trustees.
The following is a summary of cash and investments at June 30, 2020
Governmental Business-Type Fiduciary
Activities Activities Funds Total
Cash and investments 41,443,129$ 57,044,630$ 8,120,048$ 106,607,807$
Cash with fiscal agent:
Cash with fiscal agent for debt service 3,007,388 6,050,238 12,374,570 21,432,196
Cash held for rate stabilization - 10,941,541 - 10,941,541
Total cash with fiscal agent 3,007,388 16,991,779 12,374,570 32,373,737
Total cash and investments 44,450,517$ 74,036,409$ 20,494,618$ 138,981,544$
Government-Wide Statement of
Net Position
Cash and investments as of June 30, 2020 consist of the following:
Cash on hand 500$
Deposits with financial institution 13,890,653
Total cash on hand and deposits 13,891,153
Local Agency Investment Funds 40,003,055
Government Obligations:
Federal Farm Credit Bank 4,057,098
Federal Home Loan Bank 1,351,472
Federal Home Loan Mortgage Corp.5,424,866
Federal National Mortgage Association 2,009,540
Certificates of Deposit 8,611,149
Corporate Bonds 9,786,131
Money market mutual funds 21,473,343
Total investments 92,716,654
Total City Treasury 106,607,807
Cash with fiscal agent 21,432,196
Cash held for rate stabilization 10,941,541
Total cash and investments 138,981,544$
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
57
2. CASH AND INVESTMENTS, Continued
B. Deposits
The carrying amount of the City’s cash deposit was $13,890,653 at June 30, 2020. Bank balances before
reconciling items were a positive amount of $14,608,558 at June 30, 2020. Cash deposits are fully insured
up to $250,000 by the Federal Deposit Insurance Corporation, the remaining amount was collateralized
with securities held by the pledging financial institutions in the City’s name.
The California Government Code (Section 53655) requires California banks and savings and loan
associations to secure the City’s cash deposits by pledging securities as collateral. The Code states that
collateral pledged in this manner shall have the effect of perfecting a security interest in such collateral
superior to those of a general creditor.
The fair value of pledged securities must equal at least 110% of the City’s cash deposits. California law
also allows institutions to secure City deposits by pledging first trust deed mortgage notes having a value
of 150% of the City’s total cash deposits.
The City follows the practice of pooling cash and investments of all funds, except for funds required to
be held by fiscal agents under the provisions of bond indentures. Interest income earned on pooled cash
and investments is allocated to the various funds based on the period-end cash and investments balances.
Interest income from cash and investments with fiscal agents is credited directly to the related fund.
C. Investments
Authorized Investments by the City
Under provision of the City’s investment policy, and in accordance with the California Government Code,
the following investments are authorized:
U.S. Treasury Obligations (bills, notes and bonds)
U.S. Government Agency Securities and Instrumentalities of Government Sponsored Corporations
Mutual Funds
Commercial Paper
Repurchase Agreements
Certificates of Deposit
Negotiable Certificates of Deposit
Passbook Savings Accounts
Medium Term Corporate Notes
Bank Money Market Accounts
Local Agency Investment Fund (State Pool)
Authorized Investments by the Debt Agreements
Investment of debt proceeds held by bond trustee is governed by provisions of the debt agreements rather
than the general provisions of the California Government Code or the City’s investment policy.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
58
2. CASH AND INVESTMENTS, Continued
Investments in Local Agency Investment Fund (LAIF)
The City is a voluntary 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 City’s investments with LAIF at June 30, 2020, include a portion of the pool funds invested in
Structured Notes and Asset-Backed Securities. These investments include the following:
Structured Notes – are debt securities (other than asset-backed securities) whose cash flow
characteristics (coupon rate, redemption amount, or stated maturity) depend upon one or more
indices and/or have embedded forwards or options.
Asset-Backed Securities – the bulk of which are mortgage-backed securities, entitle their purchasers
to receive a share of the cash flows from a pool of assets such as principal and interest repayments
from a pool of mortgages (such as Collateralized Mortgage Obligations) or credit card receivables.
As of June 30, 2020, the City had $40,003,055 invested in LAIF, which had invested 3.77% of the pool
investment funds in Structured Notes and Asset-Backed Securities as compared to 1.77% in the previous
year. The LAIF fair value factor of 1.004912795 was used to calculate the fair value of the investments in
LAIF.
D. Risk Disclosures
Interest Risk: Interest rate risk is the risk that changes in market interest rates will adversely affect the fair
value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of
its fair value to changes in market interest rates.
Information about the sensitivity of the fair values of the City's investments to market interest rate
fluctuations is provided by the following table that shows the distribution to the City's investments by
maturity:
Investment Type 60 months+ Total
Local Agency Investment Fund 40,003,055$ -$ -$ -$ 40,003,055$
Federal Farm Credit Bank - - - 4,057,098 4,057,098
Federal Home Loan Bank - - - 1,351,472 1,351,472
Federal Home Loan Mortgage Corp.- - - 5,424,866 5,424,866
Federal National Mortgage Assoic.- - - 2,009,540 2,009,540
Certificates of Deposit 942,890 2,286,079 2,056,747 3,325,433 8,611,149
Corporate Bonds - - 1,310,790 8,475,341 9,786,131
Money Market Mutual Funds 21,473,343 - - - 21,473,343
Total Investments 62,419,288$ 2,286,079$ 3,367,537$ 24,643,750$ 92,716,654$
Investment Maturities (in years)
12 months or
less
13 to 24
months
25 to 60
months
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
59
2. CASH AND INVESTMENTS, Continued
D. Risk Disclosures, Continued
Credit Risk: Credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder
of the investment. This is measured by the assignment of a rating by a nationally recognized statistical
rating organization. The City’s investment policy limits investments in medium term notes (MTNs) to
those rated “A” or higher by Standard and Poor’s (S&P) or by Moody’s. At June 30, 2020, the City’s
investments in Federal Agency securities consisted of investments with Federal Farm Credit Bank,
Federal Home Loan Bank, Federal Home Loan Mortgage Corporation, and Federal National Mortgage
Association. At June 30, 2020, all Federal Agency Securities were rated “AA+” by Standard and Poor’s.
All securities were investment grade and were legal under State and City law. As of June 30, 2020, the
City’s investments in external investment pools and money market mutual funds were unrated.
Custodial Credit Risk: Custodial credit risk for deposits is the risk that, in the event of the failure of a
depository financial institution, the City will not be able to recover its deposits or will not be able to
recover collateral securities that are in the possession of an outside party. Under California Government
Code Section 53651, depending on specific types of eligible securities, a bank must deposit eligible
securities posted as collateral with its Agent having a fair value of 105% to 150% of the City's cash on
deposit. All of the City's deposits are either insured by the Federal Depository Insurance Corporation
(FDIC) or collateralized with pledged securities held in the trust department of the financial institutions
in the City's name.
Concentration Risk: The City’s investment policy imposes restrictions on the percentage that the City can
invest in certain types of investments. In addition, GASB 40 requires a separate disclosure if any single
issuer comprises more than 5% of the total investment value. As of June 30, 2020, the City had the
following investments in a single issuer that comprised more than 5% of total investments:
Reported
Issuer Amount
Federal Home Loan Mortgage Corp. 5,424,866$ 5.85%
5,424,866$ 5.85%
Percentage
Interest Rate Risk: The City does not have a formal policy relating to interest rate risk.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
60
2. CASH AND INVESTMENTS, Continued
E. Investment Valuation
Investments (except for money market accounts, time deposits, and commercial paper) are measured at
fair value on a recurring basis. Recurring fair value measurements are those that Governmental
Accounting Standards Board (GASB) Statements require or permit in the statement of net position at the
end of each reporting period. Fair value measurements are categorized based on the valuation inputs
used to measure an asset’s fair value: Level 1 inputs are quoted prices in active markets for identical
assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable
inputs. Investment fair value measurements at June 30, 2020 are described on the following.
Investments included in restricted cash and investments included money market accounts and
guaranteed investment contracts are not subject to fair value measurement.
Not Subject
Investment Type Total
to Disclosure Level 1 Level 2 Level 3
U.S. Government Agency Obligations 12,842,976$ -$ -$ 12,842,976$ -$
Corporate bonds 9,786,131 - - 9,786,131 -
Certificates of deposit 8,611,149 - - 8,611,149 -
Money market funds 21,473,343 21,473,343 - - -
Local Agency Investment Fund 40,003,055 40,003,055 - - -
Total investments 92,716,654$ 61,476,398$ -$ 31,240,256$ -$
Fair Value Measurement Using
U.S. government agency obligation, corporate bonds, and certificates of deposit categorized as Level 2 are
valued based on quoted prices for similar instruments in active markets, quoted prices for identical or
similar instruments in markets that are not active and model-based valuations for which all significant
assumptions are observable or can be corroborated by observable market data.
3. INTERFUND TRANSACTIONS
A. Due To/From Other Funds
At June 30, 2020, the City had the following due to/from other funds:
Non-Major
Governmental
Funds
Internal Service
Funds Total
Due To General Fund 1,319,305$ 3,163,396$ 4,482,701$
Total 1,319,305$ 3,163,396$ 4,482,701$
Due from other funds
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
61
3. INTERFUND TRANSACTIONS, Continued
B. Advance To/From Other Funds
At June 30, 2020, the City had the following advance to/from other funds:
Funds Water Fund Light Fund Total
Advances From Other Funds
General Fund 3,001,153$ 81,000$ 3,082,153$
Water Fund - 3,500,000 3,500,000
Total 3,001,153$ 3,581,000$ 6,582,153$
Advances To Other Funds
The General Fund had previously informally borrowed monies from the Water Fund and Light Fund
during the economic downturn; no repayment is required on the loan until the General Fund accumulates
$3.5 million in cash reserves. In fiscal year 2020, the City Council adopted Resolution No. 2020-UB-01
authorizing the General Fund to pay approximate $3 million of the Water Fund’s estimated $6.4 million
unfunded accrued liability for pensions to CalPERS, and forgiving the interfund advance between the
General Fund and Water Fund after such payment is made on the Water Fund’s behalf, which is expected
to occur in fiscal year 2021.
On March 23, 2020, the City Council adopted Resolution No. 2020-UB-01 approving an agreement for the
Electric Fund to loan $3.5 million to the Water Fund to pay for a portion of the Water Fund’s estimated
$6.4 million unfunded accrued liability for pensions to CalPERS. The City plans to make the payment to
CalPERS upon issuance of Pension Obligation Bonds expected to occur in fiscal year 2021.
C. Transfers
At June 30, 2020, the City had the following transfers in/out which arise in the normal course of
operations.
The total transfers from the General Fund were for various operating, capital, and debt service
transactions made throughout the year. Transfers from the Non-Major Governmental Funds were for
various operating transactions made throughout the year. Transfers made from the Water and Light
Funds included providing funding for employee benefits. Transfers from Non-Major Enterprise Funds
consisted mainly of payment of franchise fees payable to the General Fund.
Non-Major Non-Major
Governmental Governmental Internal
General Funds Funds Service Funds Total
General Fund -$ 5,696,345$ 1,270,313$ -$ 6,966,658$
Non-major Govtl Funds 348,700 - - - 348,700
Water Fund - - 739,584 - 739,584
Light Fund - - 584,407 - 584,407
Non-major Enterprise Funds 801,085 - - 132,335 933,420
Internal Service Funds 347,665 - 134,572 - 482,237
Total 1,497,450$ 5,696,345$ 2,728,876$ 132,335$ 10,055,006$
Transfers In
Transfers Out
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
62
4. CAPITAL ASSETS
A. Government-Wide Financial Statements
At June 30, 2020, the City’s capital assets consisted of the following:
Governmental Business-Type
Activities Activities Total
Non-depreciable assets:
Land 3,562,016$ 2,988,973$ 6,550,989$
Construction in progress 3,443,308 7,664,943 11,108,251
Total non-depreciable assets 7,005,324 10,653,916 17,659,240
Depreciable assets:
Land Improvements 4,423,252 1,212,318 5,635,570
Building and improvements 13,887,905 23,301,926 37,189,831
Machinery and equipment 9,159,982 14,639,599 23,799,581
Automotive equipment 3,811,230 4,110,596 7,921,826
Infrastructure 59,906,956 168,237,141 228,144,097
91,189,325 211,501,580 302,690,905
Less accumulated depreciation:
Land Improvements 3,700,890 983,349 4,684,239
Building and improvements 7,473,733 12,205,093 19,678,826
Machinery and equipment 8,240,212 12,761,336 21,001,548
Automotive equipment 2,832,492 3,637,386 6,469,878
Infrastructure 37,337,068 75,528,185 112,865,253
Total accumulated depreciation 59,584,395 105,115,349 164,699,744
Total depreciable assets, net 31,604,930 106,386,231 137,991,161
38,610,254$ 117,040,147$ 155,650,401$
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
63
4. CAPITAL ASSETS, Continued
A. Government-Wide Financial Statements, Continued
The following is a summary of changes in the capital assets for the governmental activities during the
fiscal year:
Balance Balance
June 30, 2019 Additions Retirements June 30, 2020
Governmental activities
Non-depreciable assets:
Land 3,562,016$ -$ -$ 3,562,016$
Construction in progress 2,023,805 3,125,255 (1,705,752) 3,443,308
Total non-depreciable assets 5,585,821 3,125,255 (1,705,752) 7,005,324
Depreciable assets:
Land improvements 4,423,252 - - 4,423,252
Building and improvements 13,450,733 437,172 - 13,887,905
Machinery and equipment 8,955,165 204,817 - 9,159,982
Automotive equipment 3,212,014 714,009 (114,793) 3,811,230
Infrastructure 59,210,994 834,150 (138,188) 59,906,956
89,252,158 2,190,148 (252,981) 91,189,325
Less accumulated depreciation:
Land improvements 3,579,472 122,170 (752) 3,700,890
Building and improvements 7,144,296 329,437 - 7,473,733
Machinery and equipment 8,016,939 232,369 (9,096) 8,240,212
Automotive equipment 2,763,690 176,898 (108,096) 2,832,492
Infrastructure 36,233,875 1,103,193 - 37,337,068
Total accumulated depreciation 57,738,272 1,964,067 (117,944) 59,584,395
Total depreciable assets, net 31,513,886 226,080 (135,036) 31,604,930
Governmental activities capital assets, net 37,099,707$ 3,351,335$ (1,840,788)$ 38,610,254$
Depreciation expense by program for capital assets for the year ended June 30, 2020 was as follows:
General government 107,005$
Public safety 119,040
Community development 16,981
Parks and recreation 294,468
Public works 1,351,435
Internal service funds 75,138
Total Governmental Activities 1,964,067$
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
64
4. CAPITAL ASSETS, Continued
A. Government-Wide Financial Statements, Continued
The following is a summary of changes in the capital assets for business-type activities during the fiscal
year:
Balance Balance
June 30, 2019 Additions Retirements June 30, 2020
Non-depreciable assets:
Land 2,988,973$ -$ -$ 2,988,973$
Construction in progress 2,627,605 10,058,261 (5,020,923) 7,664,943
Total non-depreciable assets 5,616,578 10,058,261 (5,020,923) 10,653,916
Depreciable assets:
Land improvements 1,212,318 - - 1,212,318
Building and improvements 22,635,773 666,153 - 23,301,926
Machinery and equipment 14,289,780 349,819 - 14,639,599
Automotive equipment 3,990,901 159,456 (39,761) 4,110,596
Infrastructure 162,880,129 5,357,012 - 168,237,141
Total depreciable assets 205,008,901 6,532,440 (39,761) 211,501,580
Less accumulated depreciation:
Land improvements 945,554 37,795 - 983,349
Building and improvements 11,709,746 495,347 - 12,205,093
Machinery and equipment 12,378,846 382,490 - 12,761,336
Automotive equipment 3,584,718 92,429 (39,761) 3,637,386
Infrastructure 70,854,713 4,673,472 - 75,528,185
Total accumulated depreciation 99,473,577 5,681,532 (39,761) 105,115,349
Total depreciable assets, net 105,535,324 850,908 - 106,386,231
Business-type activity capital assets, net 111,151,902$ 10,909,169$ (5,020,923)$ 117,040,147$
Depreciation expense for the year ended June 30, 2020 was as follows:
Water 3,811,721$
Light 1,334,443
Sewer/Wastewater 489,347
Internal service funds 46,021
Total Business-Type Activities 5,681,532$
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
65
5. LONG-TERM DEBT
A. Governmental Activities
The following is a summary of long-term debt transactions including amortization for the year ended
June 30, 2020:
Due in
Balance Balance Due Within More Than
June 30, 2019 Additions Deletion June 30, 2020 One Year One Year
2016 TRIP Installment Sale 3,280,000$ -$ (110,000)$ 3,170,000$ 115,000$ 3,055,000$
PFA 2003 Certificates
of Participation 1,160,000 - (315,000) 845,000 845,000 -
Capital Lease 83,496 - (42,553) 40,943 40,943 -
Unamortized Premiums 157,883 - (3,672) 154,211 - 154,211
Unamortized Discounts (2,937) 2,130 - (807) - (807)
Subtotal 4,678,442 2,130 (471,225) 4,209,347 1,000,943 3,208,404
Note payable - Successor Agency 8,208,833 - - 8,208,833 - 8,208,833
Total long-term debt 12,887,275$ 2,130$ (471,225)$ 12,418,180$ 1,000,943$ 11,417,237$
2016 Local Measure R Sales Tax Revenue (Installment Sale) Certificates of Participation
On March 17, 2016, California Communities issued Local Measure R Sales Tax Revenue (Installment Sale)
Certificates of Participation (T.R.I.P. – Total Road Improvement Program) in the amount of $6,355,000 to
the City of San Fernando ($2,785,000) and the City of Azusa ($3,570,000). The proceeds will be used to pay
the costs of acquisition and construction of the Project and to pay the incidental costs and expenses related
thereto as provided in the Trust Agreement. The certificates of participation mature in annual installments
beginning on June 1, 2017 through June 1, 2039, in amounts ranging from $80,000 to $220,000. Interest
ranges from 2.000% to 5.000% and is payable semi-annually on June 1 and December 1. The outstanding
principal balance at June 30, 2020, was $3,170,000.
The annual requirements to amortize the outstanding certificates of participation as of June 30, 2020,
including interest are as follows:
Year Ending June 30, Principal Interest Total
2021 115,000$ 113,794$ 228,794$
2022 120,000 109,194 229,194
2023 125,000 104,394 229,394
2024 130,000 99,384 229,384
2025 135,000 92,894 227,894
2026-2030 775,000 365,919 1,140,919
2031-2035 925,000 222,981 1,147,981
2035-2039 845,000 69,463 914,463
Total 3,170,000$ 1,178,023$ 4,348,023$
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
66
5. LONG-TERM DEBT, Continued
A. Governmental Activities, Continued
2003 Certificates of Participation
On August 7, 2003, the Azusa Public Financing Authority issued the 2003 Lease Revenue Refunding
Certificates of Participation in the amount of $4,825,000 to refund the outstanding balance of the 1994
Certificates of Participation. The bonds are subject to optional and mandatory redemption prior to
maturity and are payable from certain revenue consisting of certain base rental payments with respect to
the lease agreement between the City and the Authority.
Debt covenants require that the Authority maintain a reserve account equal to the maximum annual debt
service on all outstanding certificates. As of June 30, 2015, the reserve requirement of $482,500 was fully
funded.
The certificates maturing from 2004 to 2020 are serial certificates payable in annual installments ranging
from $200,000 to $845,000. Interest is payable semi-annually on each August 1 and February 1,
commencing August 1, 2004, at rates ranging from 2.00% to 4.40% per annum. The outstanding principal
balance as of June 30, 2020, was $845,000.
The annual requirements to repay the outstanding indebtedness at June 30, including interest, are shown
in the schedule below:
Year Ending June 30, Principal Interest Total
2021 845,000$ 18,590$ 863,590$
Total 845,000$ 18,590$ 863,590$
Capital Lease
The City entered into a lease agreement for the purchase of four vehicles and emergency equipment in
October 2017 for the Azusa Police Department. The lease was for $162,000 to be repaid in sixteen quarterly
installments of $10,897. Total minimum lease payments as of June 30, 2020 equal $43,588 ($40,943 to be
applied to principal and $2,645 to be recognized as interest expense).
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
67
5. LONG-TERM DEBT, Continued
A. Governmental Activities, Continued
Note Payable – Successor Agency
In 2011, the City called repayment of the advances made to the former Redevelopment Agency. The former
Redevelopment Agency approved in March 2011 to transfer property to the City as repayment of the loans.
The property was transferred at cost, which exceeded the loan agreement balance; therefore; an advance to
the Successor Agency was created in the amount of $8,032,773. In FY 2012, the advance increased by the Price
Club triple flip sales tax allocation owed to the Successor Agency in the amount of $176,060. Outstanding
balance at June 30, 2020 is $8,208,833.
B. Business-Type Activities
The City’s debt issues and transactions of business-type activities are summarized below and discussed
in detail thereafter.
Due in
Balance Balance Due Within More Than
June 30, 2019 Deletion June 30, 2020 One Year One Year
2012 Water Refunding Bonds, Series A 4,375,000$ (810,000)$ 3,565,000$ 835,000$ 2,730,000$
2015 Water System Refunding Revenue Bonds 44,160,000 (1,310,000) 42,850,000 1,375,000 41,475,000
2012 Electric Refunding Revenue Bonds, Series B 4,375,000 (820,000) 3,555,000 845,000 2,710,000
2011 Sewer Installment, Series A 375,000 (185,000) 190,000 190,000 -
2011 Sewer Installment, Series B 2,830,000 (230,000) 2,600,000 235,000 2,365,000
Unamortized Premiums 3,096,209 (246,612) 2,849,597 - 2,849,597
Total long-term debt 59,211,209$ (3,601,612)$ 55,609,597$ 3,480,000$ 52,129,597$
2012 Water Refunding Revenue Bonds
On May 23, 2012, the City issued $8,715,000 of 2012 Water System Refunding Revenue Bonds, Series A.
The proceeds were primarily used to advance refund all of the City’s obligations in connection with the
Financing Authority for Resource Efficiency of California Certificates of Participation, 2003 Series A,
which was issued for capital improvements. The bonds are payable solely from the Water net revenues,
and the City is not obligated to pay them except from the applicable Water net revenues. Serial bonds
mature in annual installments beginning on July 1, 2013 through July 1, 2023, in amounts ranging from
$310,000 to $955,000. Interest ranges from 2.000% to 5.000% and is payable semi-annually on July 1 and
January 1.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
68
5. LONG-TERM DEBT, Continued
B. Business-Type Activities, Continued
2012 Water Refunding Revenue Bonds, Continued
The annual requirements to amortize the outstanding bonds as of June 30, 2020, including interest are as
follows:
Year Ending June 30, Principal Interest Total
2021 835,000$ 153,200$ 988,200$
2022 865,000 114,875 979,875
2023 910,000 70,500 980,500
2024 955,000 23,875 978,875
Total 3,565,000$ 362,450$ 3,927,450$
2015 Water System Refunding Revenue Bonds
On July 23, 2015, the City issued $47,740,000 of 2015 Water System Refunding Revenue Bonds. The
proceeds were used to refinance all of the City’s obligations in connection with the Azusa Public
Financing Authority Parity Revenue Bonds (Water System Capital Improvements Program) Series 2006,
and pay costs of issuance incurred in connection with the issuance of the 2015 Bonds. The bonds are
payable solely from the Water net revenues, and the City is not obligated to pay them except from the
applicable Water net revenues. The refunding resulted in a difference between the reacquisition price and
the net carrying amount of the old debt of $625,426, which is reported as a deferred outflow of resources
in the accompanying financial statements and amortized over the remaining life of the refunded debt.
The City completed the refunding to reduce its total debt service payments by $3,440,000 and to obtain
an economic gain (difference between the present values of the old and new debt service payments) of
$14,486,840. Serial bonds mature in annual installments beginning on July 1, 2016 through July 1, 2039, in
amounts ranging from $1,150,000 to $3,035,000. Interest ranges from 3.000% to 5.000% and is payable
semi-annually on July 1 and January 1.
The annual requirements to amortize the outstanding bonds as of June 30, 2020, including interest are as
follows:
Year Ending June 30, Principal Interest Total
2021 1,375,000$ 1,722,563$ 3,097,563$
2022 1,445,000 1,652,063 3,097,063
2023 1,520,000 1,577,938 3,097,938
2024 1,600,000 1,499,938 3,099,938
2025 1,680,000 1,417,938 3,097,938
2026-2030 9,590,000 5,892,888 15,482,888
2031-2035 11,595,000 3,885,719 15,480,719
2036-2040 14,045,000 1,442,013 15,487,013
Total 42,850,000$ 19,091,060$ 61,941,060$
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
69
5. LONG-TERM DEBT, Continued
B. Business-Type Activities, Continued
2012 Electric Refunding Revenue Bonds
On May 23, 2012, the City issued $5,820,000 of 2012 Electric System Refunding Revenue Bonds, Series B.
The proceeds were primarily used to advance refund all of the City’s obligations in connection with the
Financing Authority for Resource Efficiency of California Certificates of Participation, Series B. The bonds
are payable solely from the Electric net revenues, and the City is not obligated to pay them except from
the applicable Electric net revenues. Serial bonds mature in annual installments beginning on July 1, 2017
through July 1, 2023, in amounts ranging from $650,000 to $930,000. Interest ranges from 2.000% to 5.000%
and is payable semi-annually on July 1 and January 1.
Debt covenants require that the City maintain a reserve account equal $582,000. As of June 30, 2020, the
reserve requirement was fully funded.
The annual requirements to amortize the outstanding bonds as of June 30, 2020, including interest are as
follows:
Year Ending June 30, Principal Interest Total
2021 845,000$ 99,331$ 944,331$
2022 875,000 69,231 944,231
2023 905,000 40,909 945,909
2024 930,000 13,950 943,950
Total 3,555,000$ 223,422$ 3,778,422$
2011 Sewer Installment Agreement Series A and B
On November 29, 2011, the City of Azusa entered into an installment Sale Agreement with Capitol One
Public Funding, LLC totaling $5,630,000. The proceeds were used to defease the 1994 Sewer System
Certificates of Participation, which was used for improvements on the sewer system. The agreement
specified the installments consisted of $1,490,000 of Series A installments and $4,140,000 of Series B
installments.
The Series A installments have annual principal payments beginning on August 1, 2012 through August
1, 2020 ranging from $105,000 to $190,000. Interest rates on the Series A installments are 2.900%.
The Series B installments have annual principal payments beginning on August 1, 2012 through August
1, 2025 ranging from $120,000 to $505,000. Interest rates on the Series B installments are 3.600%.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
70
5 LONG-TERM DEBT, Continued
B. Business-Type Activities, Continued
2011 Sewer Installment Agreement Series A and B, Continued
The annual requirements to amortize the outstanding installment agreements as of June 30, 2020,
including interest are as follows:
Year Ending
June 30, Principal Interest Total Principal Interest Total
2021 190,000$ 2,755$ 192,755$ 235,000$ 89,370$ 324,370$
2022 - - - 440,000 77,220 517,220
2023 - - - 455,000 61,110 516,110
2024 - - - 475,000 44,370 519,370
2025 - - - 490,000 27,000 517,000
2026 - - - 505,000 9,090 514,090
Subtotal 190,000$ 2,755$ 192,755$ 2,600,000 308,160$ 2,908,160$
2011 Sewer Installment, Series A 2011 Sewer Installment, Series B
C. Debt without City Commitment
The City of Azusa has authorized the formation of the City of Azusa – Community Facilities District No.
2002-1 (Mountain Cove) and the City of Azusa – Community Facilities District No. 2005-1 (Rosedale)
Improvement Area No. 1, acting through its eligible landowner voters, and the issuance of bonds under
the public improvement act (Mello-Roos Community Facilities Act of 1982) of the State of California to
finance certain costs of acquisition and construction of certain water, sewer, reservoir, pump station and
bike trail improvements generally related to development within the Mountain Cove District, and to
finance eligible public facilities necessary to be owned and maintained by the City as well as public
facilities for the Azusa Unified School District, the Los Angeles Pasadena Metro Blue Line Construction
Authority, and the City of Glendora. The bonds are secured by annual special tax levies or liens placed
on the property within the respective districts.
The City of Azusa is not liable for repayment and acts only as an agent for the property owners in
collecting the special taxes or assessments, forwarding the collections to bondholders, and initiating
foreclosure proceedings when necessary. Accordingly, the special tax bonds are not reported as liabilities
in the City’s basic financial statements. As of June 30, 2020, the total outstanding balances of the special
tax bonds were $51,200,000.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
71
6. COMPENSATED ABSENCES
Compensated absences comprise unpaid vacation, unpaid compensatory leave balances, and the vested
portion of sick leave, which are accrued as earned. The City's liability for compensated absences is
recorded in various governmental funds or proprietary funds as appropriate. The liability for
compensated absences is determined annually. Compensated absences are reported in governmental
funds only if they have matured. For all governmental funds, amounts expected to be permanently
liquidated are recorded as fund liabilities; the long-term portion is recorded in the Statement of Net
Position. Compensated absences are liquidated by the fund that has recorded the liability. The long-term
portion of governmental activities compensated absences is liquidated primarily by the General Fund.
Employees accrue vacation, annual leave, earned time off, and holiday leave up to certain maximums,
based on the employee’s bargaining unit. Employees may elect to be paid a portion of these leaves at
various times according to the applicable Memorandum of Understanding. Sick leave may be
accumulated without limit.
The City accrues the liability for compensated leave as it is earned by employees. The amount of
compensated leaves payable outstanding was $5,144,915 as of June 30, 2020.
Due in
Balance Balance Due Within More Than
June 30, 2019 Additions Deletions June 30, 2020 One Year One Year
Governmental Activities
Compensated Leaves Payable 3,503,051$ 2,523,768$ (2,371,607)$ 3,655,212$ 2,576,081$ 1,079,131$
Business-Type Activities
Compensated Leaves Payable 1,302,142$ 1,102,528$ (914,967)$ 1,489,703$ 1,022,761$ 466,942$
7. RETIREMENT PLANS
The City of Azusa contributes to the California Public Employees Retirement System (PERS), an agent
multiple-employer public employee defined benefit pension plan for the miscellaneous plan and a cost
sharing multiple-employer public employee defined benefit pension plan for the safety plan. PERS provides
retirement and disability benefits, annual cost-of-living adjustments and death benefits to plan members and
beneficiaries. PERS acts as a common investment and administrative agent for participating public entities
within the State of California. Benefit provisions and all other requirements are established by State statute
and City ordinance. Copies of PERS’ annual financial report may be obtained from their executive office: 400
P Street, Sacramento, CA 95814.
Additionally, the City of Azusa contributes to the Public Agency Retirement System (PARS) defined
contribution plan and the PARS Retirement Enhancement Plans defined benefit plans (AMMA, Executives,
IBEW, and SEIU). These plans are provided and administered by the Public Agency Retirement System
Alternate Retirement System Plan.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
72
7. RETIREMENT PLANS, Continued
The following schedule provides a summary of deferred outflows of resources, liabilities, deferred inflows of
resources, and pension expense for the City’s pension plans.
Deferred Net Deferred
Outflows Related Pension Inflows Related Pension
to Pension Liability To Pension Expense
CalPERS Miscellaneous Agent Multiple Employer Plan 5,881,941$ 40,317,320$ 932,811$ 8,631,263$
CALPERS Cost Sharing Plan - Safety 8,602,941 37,495,554 2,184,664 7,560,681
PARS Agent Multiple Employer Plan - AMMA 349,742 971,369 187,434 165,503
PARS Agent Multiple Employer Plan - Executives 188,693 2,047,514 6,170 166,057
PARS Agent Multiple Employer Plan - IBEW 409,142 1,116,607 59,681 169,434
PARS Agent Multiple Employer Plan - SEIU 57,752 152,198 40,008 18,499
Total 15,490,211$ 82,100,562$ 3,410,768$ 16,711,437$
A. CalPERS Plans
Plan Description
The City of Azusa contributes to the California Public Employees Retirement System (PERS); to both a
miscellaneous agent multiple-employer and safety cost-sharing multiple employer defined benefit
pension plans. PERS provides retirement and disability benefits, annual cost-of-living adjustments and
death benefits to plan members and beneficiaries. PERS acts as a common investment and administrative
agent for participating public entities within the State of California. Benefit provisions and all other
requirements are established by State statute and City ordinance.
The cost sharing plan consists of individual rate plans (benefit tiers) within a safety risk pool (police and
fire) and a miscellaneous risk pool (all other.) Plan assets may be used to pay benefits for any employer
rate plan of the safety and miscellaneous risk pools. Accordingly, rate plans within the safety or
miscellaneous pools are not separate plans under GASB Statement No. 68. Individual employers may
sponsor more than one rate plan in the miscellaneous or safety risk pools. The City sponsors three safety
rate plans. Benefit provisions under the Plan are established by State statute and City ordinance. CalPERS
issues publicly available reports that include a full description of the pension plan regarding benefit
provisions, assumptions, and membership information that can be found on the 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-duty
disability benefits after 10 years of service. The death benefit is one of the following: the Basic Death
Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living
adjustments for each plan are applied as specified by the Public Employee’s Retirement Law.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
73
7. RETIREMENT PLANS, Continued
A. CalPERS Plans, Continued
Benefits Provided, Continued
The miscellaneous agent multiple employer plan’s provisions and benefits in effect at June 30, 2020 are
summarized as follows:
Classic PEPRA
Hire date Prior to January 1, 2013 January 1, 2013 and after
Benefit vesting schedule 5 years service 5 years service
Benefit payment Monthly for life Monthly for life
Retirement age 55 62
Monthly benefits, as a % of annual salary 2.50%2.0%
Required employee contribution rates 7.00%6.75%
Required employer contribution rates 9.743%9.743%
Required UAL payment 2,703,386$ -$
The safety cost sharing plan rate plan’s provisions and benefits in effect at June 30, 2020 are summarized
as follows:
Classic Tier 2 PEPRA
Hire date
Prior to
October 15, 2012
October 15, 2012 to
December 31, 2012
January 1, 2013
and after
Benefit vesting schedule 5 years service 5 years service 5 years service
Benefit payment Monthly for life Monthly for life Monthly for life
Retirement age 505057
Monthly benefits, as a % of annual salary 3.00%2.00%2.70%
Required employee contribution rates 9.00%9.00%12.75%
Required employer contribution rates 26.150%24.087%13.786%
Required UAL payment 2,276,235$ 5,356$ 1,190$
Employees Covered – As of the measurement date, the following employees were covered by the benefit
terms for the Miscellaneous Agent Multiple-Employer Plan:
Miscellaneous
Inactive employees or beneficiaries
currently receiving benefits 359
Inactive employees entitled to but not yet
receiving benefits 260
Active employees 236
Total 855
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
74
7. RETIREMENT PLANS, Continued
A. CalPERS Plans, Continued
Benefits Provided, Continued
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 actuarial basis, annually and
is effective on 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 City is required to contribute
the difference between the actuarially determined rate and the contribution rate of employees.
For governmental activities, the General Fund has typically been used in prior years to liquidate pension
liabilities.
Net Pension Liability
The City’s net pension liability for the Miscellaneous Plan is measured as the total pension liability, less
the pension plan's fiduciary net position.
For the Safety Plan, net pension liability is measured as the proportionate share of the net pension liability.
The net pension liability of each of the Plans is measured as of June 30, 2019, using an annual actuarial
valuation as of June 30, 2018 rolled forward to June 30, 2019 using standard update procedures. The City’s
proportion of the net pension liability (Safety Plan) was based on a projection of the City’s long-term share
of contributions to the pension plans relative to the projected contributions of all participating employers,
actuarially determined. The City’s proportionate share of the net pension liability for the Safety Plan as
of the measurement dates June 30, 2018 and June 30, 2019 were as follows:
City Cost Sharing
Plan
Proportion - June 30, 2018 0.35940%
Proportion - June 30, 2019 0.36592%
Change - Increase (Decrease)0.00652%
.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
75
7. RETIREMENT PLANS, Continued
A. CalPERS Plans, Continued
Net Pension Liability, Continued
A summary of principal assumptions and methods used to determine the net pension liability is shown
below.
Actuarial Assumptions - The total pension liabilities in the June 30, 2017 actuarial valuations were
determined using the following actuarial assumptions:
Miscellaneous Agent Multiple
Employer Plan Safety Cost Sharing Plan
Valuation Date June 30, 2018 June 30, 2018
Measurement Date June 30, 2019 June 30, 2019
Actuarial Cost Method
Actuarial Assumptions:
Discount Rate 7.15%7.15%
Inflation 2.50%2.50%
Salary Increases
Investment Rate of Return (1)7.15%7.15%
Mortality (2)
Post Retirement Benefit Increase
Entry-Age Normal Cost Method
Varies by Entry Age and Service
Derived using CalPERS' Membership Data for all Funds
The lesser of contract COLA or 2.50% until Purchasing Power
Protection Allowance floor on purchasing power applies, 2.50%
thereafter
(1) Depending on age, service, and type of employment
(2) Net of pension plan administrative expenses
(3) The mortality table used was developed based on CalPERS' specific data. The table incudes 20 years of mortality
improvements using Society of Actuaries Scale BB. For more details on this table, please refer to the 2014 experience study
report
All other actuarial assumptions used in the June 30, 2018 valuation were based on the results of an
actuarial experience study for the fiscal years 1997 to 2015, including updates to salary increase, mortality,
and retirement rates. The experience study report can be obtained at CalPERS’ website under Forms and
Publications.
Discount Rate - The discount rate used to measure the total pension liability was 7.15% for each Plan. This
rate includes investment expenses and inflation. 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.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
76
7. RETIREMENT PLANS, Continued
A. CalPERS Plans, Continued
Net Pension Liability, Continued
Discount Rate (Continued) - The long-term expected rate of return on pension plan investments was
determined using a building-block method in which best-estimate ranges of expected future real rates of
return (expected returns, net of pension plan investment expense and inflation) are developed for each
major asset class.
In determining the long-term expected rate of return, CalPERS took into account both short-term and
long-term market return expectations as well as the expected pension fund cash flows. Using historical
returns of all the funds’ asset classes, expected compound returns were calculated over the short-term
(first 10 years) and the long-term (11-60 years) using a building-block approach. Using the expected
nominal returns for both short-term and long-term, the present value of benefits was calculated for each
fund. The expected rate of return was set by calculating the single equivalent expected return that
arrived at the same present value of benefits for cash flows as the one calculated using both short-term
and long-term returns. The expected rate of return was then set equivalent to the single equivalent rate
calculated above, and rounded down to the nearest one quarter of one percent.
The table below reflects the long-term expected real rate of return by asset class. The rate of return was
calculated using the capital market assumptions applied to determine the discount rate and asset
allocation. These rates of return are net of administrative expenses.
New
Strategic Real Return Real Return
Asset Class Allocation Years 1 - 10(a)Years 11+(b)
Global Equity 50.00% 4.80% 5.98%
Global Fixed Income 28.00% 1.00% 2.62%
Inflation Sensitive 0.00% 0.77% 1.81%
Private 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) An expected inflation of 2.0% used for this period.
(b) An expected inflation of 2.92% used for this period.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
77
7. RETIREMENT PLANS, Continued
A. CalPERS Plans, Continued
Changes in Net Pension Liability
The change in the Net Pension Liability for the Miscellaneous Plan is as follows:
Miscellaneous Plan:
Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability/(Asset)
Balance at June 30, 2018 $ 150,017,209 $ 113,322,627 $ 36,694,582
Changes in the year:
Service cost 2,642,631 - 2,642,631
Interest on the total pension liability 10,746,822 - 10,746,822
Differences between actual and
expected experience 2,523,996 - 2,523,996
Changes in assumptions - - -
Plan to Plan Resource Movement - 19,282 (19,282)
Contribution - employer - 3,622,928 (3,622,928)
Contribution - employee - 1,282,651 (1,282,651)
Net investment income - 7,446,456 (7,446,456)
Administrative expenses - (80,869) 80,869
Other miscellaneous expense - 263 (263)
Benefit payments , including refunds of
employee contributions (7,114,634) (7,114,634) -
Net changes 8,798,815 5,176,077 3,622,738
Balance at June 30, 2019 $ 158,816,024 $ 118,498,704 $ 40,317,320
Increase (Decrease)
CalPERS Cost Sharing Plan - The City contributed $3,294,240 for the measurement period ended June
30, 2019 and $3,716,215 for the fiscal year ended June 30, 2020. The City’s contribution of $3,716,215 is
reflected as a deferred outflow of resources in the City’s basic financial statements as of June 30, 2020.
As of June 30, 2020, the City reported net pension liabilities for its proportionate share of the net pension
liability of the Cost Sharing Plan of $37,495,554.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
78
7. RETIREMENT PLANS, Continued
A. CalPERS Plans, Continued
Changes in Net Pension Liability, Continued
Sensitivity of the Net Pension Liability to Changes in the Discount Rate – The following presents the
net pension liability of the City for each Plan, calculated using the discount rate for each Plan, as well
as what the City’s net pension liability would be if it were calculated using a discount rate that is 1-
percentage point lower or 1-percentage point higher than the current rate:
CalPERS
Miscellaneous
Agent Multiple
Employer Plan
CalPERS Safety
Cost Sharing
Plan
Total CalPERS'
Plans
1% Decrease
Net Pension Liability $ 61,850,532 $ 56,143,134 117,993,666$
Current Discount Rate
Net Pension Liability $ 40,317,320 $ 37,495,554 77,812,874$
1% Increase
Net Pension Liability $ 22,596,222 $ 22,207,460 44,803,682$
Pension Plan Fiduciary Net Position – Detailed information about each pension plan’s fiduciary net position
is available in the separately issued CalPERS financial reports. Reports may be obtained from
www.calpers.ca.gov.
Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
For the year ended June 30, 2020, the City recognized pension expense of $8,631,263 for the Miscellaneous
Agent Multiple Employer Plan and $7,560,681 for the Safety Cost Sharing Plan.
At June 30, 2020, the City reported deferred outflows of resources and deferred inflows of resources
related to pensions from the following source for the Miscellaneous Agent Multiple Employer Plan:
Deferred Outflows
of Resources
Deferred Inflows
of Resources
Pension contributions subsequent to
measurement date 4,199,277$ -$
Differences between actual and expected
experience 1,682,664 (175,111)
Changes in assumptions - (182,181)
Net differences between projected and
actual earnings on plan investments - (575,519)
Total 5,881,941$ (932,811)$
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
79
7. RETIREMENT PLANS, Continued
A. CalPERS Plans, Continued
Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions, Continued
$4,199,277 reported as deferred outflows of resources related to contributions subsequent to the
measurement date will be recognized as a reduction of the net pension liability in the year ending June
30, 2021. Other amounts reported as deferred outflows of resources and deferred inflows of resources
related to pensions will be recognized as pension expense as follows:
Fiscal Year
Ending June 30:
2021 $ 937,441
2022 (108,489)
2023 (191,265)
2024 112,166
At June 30, 2020, the City reported deferred outflows of resources and deferred inflows of resources
related to pensions from the following source for the Safety Cost Sharing Plan:
Deferred Outflows
of Resources
Deferred Inflows
of Resources
Pension contributions subsequent to
measurement date $ 3,716,215 $ -
Differences between actual and expected
experience 2,448,121 -
Changes in assumptions 1,536,877 (299,920)
Changes in employer's proportion 901,728 (91,815)
Differences between the employer's
contribution and the employer's
proportionate share of contributions - (1,277,114)
Net differences between projected and
actual earnings on plan investments - (515,815)
Total 8,602,941$ (2,184,664)$
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
80
7. RETIREMENT PLANS, Continued
A. CalPERS Plans, Continued
Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions, Continued
$3,716,215 reported as deferred outflows of resources related to contributions subsequent to the
measurement date will be recognized as a reduction of the net pension liability in the year ending June
30, 2021. Other amounts reported as deferred outflows of resources and deferred inflows of resources
related to pensions will be recognized as pension expense as follows:
Fiscal Year
Ending June 30:
2021 $ 2,470,298
2022 (196,523)
2023 327,926
2024 100,361
Payables to the Pension Plan
At June 30, 2020, the City reported no payables for outstanding amounts of contributions for both the
CalPERS Miscellaneous Agent Multiple-Employer Plan or the CalPERS Safety Cost Sharing Multiple-
Employer Plan.
B. PARS Retirement Enhancement Plans
Plan Descriptions
The plans provide pension benefits to 133 eligible covered positions in International Brotherhood of
Electrical Workers (IBEW), Service Employees International Union Local 721 (SEIU), Azusa Middle
Management Association (AMMA), and Executive Management. The plans are administered by Phase II
Systems, PARS Trust Administration. PARS is a 401(a) tax-qualified agent multiple-employer defined
benefit plan made up of California governmental agencies. PARS acts as a common investment and
administrative agent for participating public entities within the State of California. Benefit provisions and
all other requirements are established by City ordinance.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
81
7. RETIREMENT PLANS, Continued
B. PARS Retirement Enhancement Plans, Continued
Benefits Provided
The PARS Retirement Enhancement Plans’ provisions and benefits in effect at June 30, 2020 are
summarized as follows:
AMMA Executive IBEW SEIU
Hire date
July 1, 2007
and after
Jul y 1, 2006
and after
July 1, 2006
and after
Jul y 1, 2006
and after
Benefit vesting schedule 5 years service 5 years service 5 years service 5 years service
Benefit payment Monthly for life Monthly for life Monthly for life Monthly for life
Retirement age 55555555
Monthl y benefits, as a % of annual salar 0.50%0.50%0.50%0.50%
Required employee contribution rates 2.50%0.00%2.00%4.00%
Required employer contribution rates 9.97%14.00%5.44%3.72%
Employees Covered – As of the June 30, 2020, the following employees were covered by the PARS
Retirement Enhancement Plans were as follows:
AMMA Executive IBEW SEIU
Inactive employees or beneficiaries
currently receiving benefits 6515 2
Inactive employees entitled to but not yet
receiving benefits 7314 6
Active employees 20 4 42 9
Total 33 12 71 17
Contributions – Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires
that the employer contribution rates for all public employees 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. The total plan
contributions are determined by an independent pension actuary using information furnished by the
City and by PARS. 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 City is required to contribute the difference between the actuarially determined rate
and the contribution rate of employees. Employer contribution rates may change if plan contracts are
amended.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
82
7. RETIREMENT PLANS, Continued
B. PARS Retirement Enhancement Plans, Continued
Net Pension Liability
For the measurement period ended June 30, 2019 (the measurement date), the employer and employee
contribution rates were as follows:
AMMA Executive IBEW SEIU
Employer contribution rate 9.97% 14.00% 5.44% 3.72%
Employee contribution rate 2.50% 0.00% 2.00% 4.00%
For governmental activities, the General Fund has typically been used in prior years to liquidate pension
liabilities.
The City’s net pension liabilities for the PARS Retirement Enhancement Plans are measured as the total
pension liability, less the pension plan's fiduciary net position.
A summary of principal assumptions and methods used to determine the net pension liability is shown
below.
Actuarial Assumptions - The total pension liabilities in the June 30, 2018 actuarial valuations were
determined using the following actuarial assumptions:
AMMA Executive IBEW SEIU
Valuation Date June 30, 2018 June 30, 2018 June 30, 2018 June 30, 2018
Measurement Date June 30, 2019 June 30, 2019 June 30, 2019 June 30, 2019
Actuarial Cost Method
Actuarial Assumptions:
Discount Rate 6.50%6.50%6.50%6.50%
Inflation 2.75%2.75%2.75%2.75%
Salary Increases
Investment Rate of Return 6.50%6.50%6.50%6.50%
Mortality (1)
Post Retirement Benefit Increase 2.75%2.75%2.75%2.75%
Entry-Age Normal Cost Method
Varies by Entry Age and Service
Derived using CalPERS' Membership Data for all Funds
Discount Rate - The plans’ fiduciary net positons were projected to be available to make all projected future
benefit payments of current active and inactive employees. Therefore, the discount rate for calculating the
total pension liability is equal to the long-term expected rate of return for each plan.
The best-estimate range for the long-term expected rate of return is determined by adding expected
inflation to expected long-term real returns and reflecting expected volatility and correlation. The capital
market assumptions are per actuarial investment consulting practice as of January 1, 2015.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
83
7. RETIREMENT PLANS, Continued
B. PARS Retirement Enhancement Plans, Continued
Net Pension Liability, Continued
The following assumptions detail out long-term expected rate of return for each PARS Retirement
Enhancement Plan:
AMMA
Long-Term Long-Term
Target
Expected
Arithmetic
Expected
Geometric
Asset Class Index Allocation Real Rate of Return Real Rate of Return
US Cash BAML 3-Mon Tbill 2.91% 0.71% 0.71%
US Core Fixed Income Barclays Aggregate 36.19% 1.83% 1.73%
US Equity Market Russell 3000 46.16% 4.71% 3.52%
Foreign Developed Equity MSCI EAFE NR 6.84% 6.06% 4.55%
Emerging Markets Equity MSCI EM NR 5.18% 8.23% 5.43%
US REITs FTSE NAREIT Equity REIT 2.72% 5.05% 3.42%
Assumed Inflation - Mean 2.21% 2.20%
Assumed Inflation - Standard Deviation 1.65% 1.65%
Portfolio Real Mean Return 3.84% 3.36%
Portfolio Nominal Mean Return 6.05% 5.63%
Portfolio Standard Deviation 9.62%
Long-Term Expected Rate of Return 6.50%
Executive
Long-Term Long-Term
Target Expected Arithmetic
Expected
Geometric
Asset Class Index Allocation Real Rate of Return Real Rate of Return
US Cash BAML 3-Mon Tbill 6.93% 0.71% 0.71%
US Core Fixed Income Barclays Aggregate 34.69% 1.83% 1.73%
US Equity Market Russell 3000 44.25% 4.71% 3.52%
Foreign Developed Equity MSCI EAFE NR 6.55% 6.06% 4.55%
Emerging Markets Equity MSCI EM NR 4.97% 8.23% 5.43%
US REITs FTSE NAREIT Equity REIT 2.61% 5.05% 3.42%
Assumed Inflation - Mean 2.21% 2.20%
Assumed Inflation - Standard Deviation 1.65% 1.65%
Portfolio Real Mean Return 3.71% 3.26%
Portfolio Nominal Mean Return 5.92% 5.53%
Portfolio Standard Deviation 9.92%
Long-Term Expected Rate of Return 6.50%
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
84
7. RETIREMENT PLANS, Continued
B. PARS Retirement Enhancement Plans, Continued
Net Pension Liability, Continued
IBEW
Long-Term Long-Term
Target
Expected
Arithmetic
Expected
Geometric
Asset Class Index Allocation Real Rate of Return Real Rate of Return
US Cash BAML 3-Mon Tbill 2.67% 0.71% 0.71%
US Core Fixed Income Barclays Aggregate 36.28% 1.83% 1.73%
US Equity Market Russell 3000 46.28% 4.71% 3.52%
Foreign Developed Equity MSCI EAFE NR 6.85% 6.06% 4.55%
Emerging Markets Equity MSCI EM NR 5.19% 8.23% 5.43%
US REITs FTSE NAREIT Equity REIT 2.73% 5.05% 3.42%
Assumed Inflation - Mean 2.21% 2.20%
Assumed Inflation - Standard Deviation 1.65% 1.65%
Portfolio Real Mean Return 3.84% 3.36%
Portfolio Nominal Mean Return 6.06% 5.63%
Portfolio Standard Deviation 9.64%
Long-Term Expected Rate of Return 6.50%
SEIU
Long-Term Long-Term
Target
Expected
Arithmetic
Expected
Geometric
Asset Class Index Allocation Real Rate of Return Real Rate of Return
US Cash BAML 3-Mon Tbill 2.67% 0.71% 0.71%
US Core Fixed Income Barclays Aggregate 36.28% 1.83% 1.73%
US Equity Market Russell 3000 46.28% 4.71% 3.52%
Foreign Developed Equity MSCI EAFE NR 6.85% 6.06% 4.55%
Emerging Markets Equity MSCI EM NR 5.19% 8.23% 5.43%
US REITs FTSE NAREIT Equity REIT 2.73% 5.05% 3.42%
Assumed Inflation - Mean 2.21% 2.20%
Assumed Inflation - Standard Deviation 1.65% 1.65%
Portfolio Real Mean Return 3.84% 3.36%
Portfolio Nominal Mean Return 6.06% 5.63%
Portfolio Standard Deviation 9.61%
Long-Term Expected Rate of Return 6.50%
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
85
7. RETIREMENT PLANS, Continued
B. PARS Retirement Enhancement Plans, Continued
Changes in Net Pension Liability
The changes in the Net Pension Liabilities for the PARS Retirement Enhancement Plans are as follows:
AMMA Plan:
Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability/(Asset)
Balance at June 30, 2018 $ 3,794,220 $ 2,791,391 $ 1,002,829
Changes in the year:
Service cost 123,963 - 123,963
Interest on the total pension liability 250,344 - 250,344
Changes in assumptions - - -
Economic/demographic gains or losses - - -
Contribution - employer - 195,062 (195,062)
Contribution - employee - 41,008 (41,008)
Net investment income - 178,824 (178,824)
Administrative expenses - (9,127) 9,127
Benefit payments , including refunds of
employee contributions (135,620) (135,620) -
Net changes 238,687 270,147 (31,460)
Balance at June 30, 2019 $ 4,032,907 $ 3,061,538 $ 971,369
Increase (Decrease)
Executive Plan:
Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability/(Asset)
Balance at June 30, 2018 $ 3,150,748 $ 1,054,300 $ 2,096,448
Changes in the year:
Interest on the total pension liability 198,591 - 198,591
Changes in assumptions - - -
Economic/demographic gains or losses - -
Contribution - employer - 188,693 (188,693)
Net investment income - 64,229 (64,229)
Administrative expenses - (5,397) 5,397
Benefit payments , including refunds of
employee contributions (194,071) (194,071) -
Net changes 4,520 53,454 (48,934)
Balance at June 30, 2019 $ 3,155,268 $ 1,107,754 $ 2,047,514
Increase (Decrease)
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
86
7. RETIREMENT PLANS, Continued
B. PARS Retirement Enhancement Plans, Continued
Changes in Net Pension Liability, Continued
IBEW Plan:
Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability/(Asset)
Balance at June 30, 2018 $ 3,741,580 $ 2,503,251 $ 1,238,329
Changes in the year:
Service cost 98,500 - 98,500
Interest on the total pension liability 244,368 - 244,368
Changes in assumptions - - -
Economic/demographic gains or losses - - -
Contribution - employer - 247,341 (247,341)
Contribution - employee - 61,521 (61,521)
Net investment income - 164,679 (164,679)
Administrative expenses - (8,951) 8,951
Benefit payments , including refunds of
employee contributions (163,726) (163,726) -
Net changes 179,142 300,864 (121,722)
Balance at June 30, 2019 $ 3,920,722 $ 2,804,115 $ 1,116,607
Increase (Decrease)
SEIU Plan:
Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability/(Asset)
Balance at June 30, 2018 $ 626,969 $ 458,839 $ 168,130
Changes in the year:
Service cost 21,002 - 21,002
Interest on the total pension liability 41,101 - 41,101
Changes in assumptions - - -
Economics/Demographic gains or losses - - -
Contribution - employer - 27,081 (27,081)
Contribution - employee - 23,319 (23,319)
Net investment income - 30,060 (30,060)
Administrative expenses - (2,425) 2,425
Benefit payments , including refunds of
employee contributions (31,800) (31,800) -
Net changes 30,303 46,235 (15,932)
Balance at June 30, 2019 $ 657,272 $ 505,074 $ 152,198
Increase (Decrease)
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
87
7. RETIREMENT PLANS, Continued
B. PARS Retirement Enhancement Plans, Continued
Changes in Net Pension Liability, Continued
Sensitivity of the Net Pension Liability to Changes in the Discount Rate – The following presents the
net pension liability of the City for each Plan, calculated using the discount rate for each Plan, as well
as what the City’s net pension liability would be if it were calculated using a discount rate that is 1-
percentage point lower or 1-percentage point higher than the current rate:
AMMA Executive IBEW SEIU Total PARS' Plans
1% Decrease
Net Pension Liability $ 1,451,647 $ 2,415,769 $ 1,630,878 $ 234,431 5,732,725$
Current Discount Rate
Net Pension Liability $ 971,369 $ 2,047,514 $ 1,116,607 $ 152,198 4,287,688$
1% Increase
Net Pension Liability $ 540,328 $ 1,712,741 $ 658,481 $ 78,566 2,990,116$
Pension Plan Fiduciary Net Position – Detailed information about each pension plan’s fiduciary net position
is available in the separately issued PARS financial reports.
Payables to the Pension Plan
At June 30, 2020, the City reported no payables for outstanding amounts of contributions for the PARS
Retirement Enhancement Plans.
Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
For the year ended June 30, 2020, the City recognized pension expense for each PARS Retirement
Enhancement Plan as follows:
Pension
Expense
PARS Agent Multiple Employer Plan - AMMA 165,503$
PARS Agent Multiple Employer Plan - Executives 166,057
PARS Agent Multiple Employer Plan - IBEW 169,434
PARS Agent Multiple Employer Plan - SEIU 18,499
Total 519,493$
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
88
7. RETIREMENT PLANS, Continued
B. PARS Retirement Enhancement Plans, Continued
Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions, Continued
At June 30, 2020, the City reported deferred outflows of resources and deferred inflows of resources
related to pensions from the following sources for each of the PARS Retirement Enhancement Plans:
Deferred Outflows
of Resources
Deferred Inflows of
Resources
Deferred Outflows
of Resources
Deferred Inflows of
Resources
Pension contributions subsequent to
measurement date 195,062$ -$ 188,693$ -$
Differences between actual and expected
experience - (169,408) - -
Changes in assumptions 154,680 - - -
Net differences between projected and
actual earnings on plan investments - (18,026) - (6,170)
Total 349,742$ (187,434)$ 188,693$ (6,170)$
Deferred Outflows
of Resources
Deferred Inflows of
Resources
Deferred Outflows
of Resources
Deferred Inflows of
Resources
Pension contributions subsequent to
measurement date 247,341$ -$ 27,081$ -$
Differences between actual and expected
experience - (41,045) 7,722 (36,652)
Changes in assumptions 161,801 - 22,949 -
Net differences between projected and
actual earnings on plan investments - (18,636) - (3,356)
Total 409,142$ (59,681)$ 57,752$ (40,008)$
AMMA Executive
IBEW SEIU
$195,062, $188,693, $247,341, and $27,081 reported as deferred outflows of resources related to
contributions subsequent to the measurement date will be recognized as a reduction of the net pension
liability in the year ending June 30, 2021. Other amounts reported as deferred outflows of resources and
deferred inflows of resources related to pensions will be recognized as pension expense as follows for
each PARS Retirement Enhancement Plan:
Fiscal Year
Ending June 30: AMMA Executive IBEW SEIU
2021 $ (8,405) $ 4,479 $ 32,531 $ 5,282
2022 (25,476) (10,359) 7,057 (8,696)
2023 21 (1,082) 25,389 (5,479)
2024 1,106 792 30,674 (444)
2025 - - 6,469 -
Thereafter - - - -
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
89
7. RETIREMENT PLANS, Continued
C. PARS Defined Contribution Plan
The City of Azusa contributes to the PARS, a defined contribution pension plan provided and
administered by the Public Agency Retirement System Alternate Retirement System Plan. Employees of
the City not otherwise eligible to participate in PERS or eligible to opt not to participate in PERS, are eligible
for participation in this plan. In a defined contribution plan, benefits depend solely on amounts
contributed to the plan plus investment earnings. Federal legislation requires contribution of at least 7.5%
to a retirement plan. The plan is established by City ordinance. For the year ended June 30, 2020, the
covered payroll for employees in the plan was $8,516,320. Total payroll for the City was $31,976,275. Under
an adoption agreement dated January 1, 1992, both the employer and the employee are required to
contribute 3.75% of each participant's compensation. For the year ended June 30, 2020, the employer and
the employees each contributed an amount equal to $450,064. Under this plan, normal retirement age is 60
years of age. Plan assets are primarily invested in money market funds.
8. POST-EMPLOYMENT BENEFITS
B. Plan Description
The City administers a single-employer defined-benefit post-employment healthcare plan. Participants
are eligible for benefits upon Service or Disability Retirement. Benefits vary by hire date and employment
status and benefits continue to surviving spouses.
C. Benefits Provided
Benefits are dependent on bargaining unit and hire date. Participants may receive up to 100% of the
monthly single premium (ACEA, CAPP, SEIU, IBEW, APOA with 20 years of service) or 100% of the
monthly dual premium (Executives, APMA with 20 years of service).Participants between 10 to 20 years
of service may receive between 50% to 75% of the monthly single premium. Percentages vary by
bargaining unit.
Participants not meeting the above requirements who remain enrolled in a City plan receive the PEMHCA
minimum payment, currently $136 per month. Other benefit provisions apply.
D. Employees Covered by Benefit Terms
As of June 30, 2020, the following employees were covered by the benefit terms for the plan:
Inactive employees or beneficiaries
currently receiving benefits 140
Active employees 200
Total 340
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
90
8. POST-EMPLOYMENT BENEFITS, Continued
E. Funding Policy
The contribution requirements of plan members and the City are established and may be amended by the
City, City Council, and/or employee associations. Currently, contributions are not required from plan
members. The City pays benefits as they come due.
F. Net OPEB Liability
The City’s net OPEB liability was measured as of June 30, 2020, and the total OPEB liability used to
calculate the net OPEB liability was determined by an actuarial valuation as of June 30, 2019.
Actuarial Assumptions
The total OPEB liability in the June 30, 2019 actuarial valuation was determined using the following
actuarial assumptions, applied to all periods included in the measurement date.
Valuation Date June 30, 2019
Measurement Date June 30, 2020
Actuarial Cost Method
Actuarial Assumptions:
Discount Rate 3.50%
Inflation 2.75%
Salary Increases
Mortality
Healthcare cost trend rates:7.25% to 4.0%
Entry-Age Normal Cost Method
3%. Individual salary increases based on CalPERS
Derived using CalPERS' Membership Data for all Funds
Discount Rate
The discount rate used to measure the total OPEB liability was 3.50%. The City’s OPEB Plan is an
unfunded plan, therefore the discount rate was set to the rate of tax-exempt, high quality 20-year
municipal bonds, as of the valuation date.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
91
8. POST-EMPLOYMENT BENEFITS, Continued
G. Changes in the Total OPEB Liability
Total OPEB Liability
Balance at June 30, 2019 $ 48,507,422
Changes in the year:
Service cost 1,847,881
Interest on the total OPEB liability 1,740,015
Differences between actual and
expected experience -
Changes in assumptions 12,972,999
Benefit payments, including refunds of
employee contributions (1,281,210)
Net changes 15,279,685
Balance at June 30, 2020 $ 63,787,107
Sensitivity of the Total OPEB liability to Changes in the Discount Rate – The following presents the
total OPEB liability of the City for the Plan, calculated using the discount rate for the Plan, as well as
what the City’s total OPEB 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:
1% Decrease - 2.50%
Total OPEB liability 77,369,655$
Current Discount Rate - 3.50%
Total OPEB liability 63,787,107$
1% Increase - 4.50%
Total OPEB liability 53,371,714$
Sensitivity of the Total OPEB liability to Changes in the Healthcare Cost Trend Rate – The following
presents the total OPEB liability of the City for the Plan, calculated using the healthcare cost trend
rate for the Plan, as well as what the City’s total OPEB liability would be if it were calculated using a
healthcare cost trend rate that is 1-percentage point lower or 1-percentage point higher than the current
rate:
1% Decrease - 6.25% Decreasing to 3.00%
Total OPEB liability 51,271,588$
Current Discount Rate - 7.25% Decreasing to 4.00%
Total OPEB liability 63,787,107$
1% Increase - 8.25% Decreasing to 5.00%
Total OPEB liability 80,709,959$
.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
92
8. POST-EMPLOYMENT BENEFITS, Continued
G. Changes in the Total OPEB Liability, Continued
OPEB Expenses and Deferred Outflows/Inflows of Resources Related to OPEB
For the year ended June 30, 2020, the City recognized OPEB expense of $6,050,636. At June 30, 2020, the
City reported deferred outflows of resources and deferred inflows of resources related to OPEB.
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Differences between expected and actual
experience $ 1,430,823 $ -
Changes in assumptions 13,540,868 -
Total 14,971,691$ -$
Amounts reported as deferred outflows of resources related to OPEB will be recognized as OPEB expense
as follows:
Fiscal Year
Ending June 30:
2021 $ 2,447,885
2022 2,447,885
2023 2,447,885
2024 2,447,885
2025 2,447,885
Thereafter 2,732,266
9. RISK MANAGEMENT
A. Description of Self-Insurance Pool Pursuant to Joint Powers Agreement
The City of Azusa became a member of the California Joint Powers Insurance Authority (Authority)
during the fiscal year. The Authority is composed of 116 California public entities and is organized under
a joint powers agreement pursuant to California Government Code §6500 et seq. The purpose of the
Authority is to arrange and administer programs for the pooling of self-insured losses, to purchase excess
insurance or reinsurance, and to arrange for group purchased insurance for property and other lines of
coverage. The Authority 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. The City has not had claims settlements exceeding insurance coverage
for each of the past three fiscal years.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
93
9. RISK MANAGEMENT, Continued
B. Self-Insurance Programs of the Authority
Each member pays an annual contribution to cover estimated losses for the coverage period. The total
funding requirement for self-insurance programs is estimated using actuarial models and pre-funded
through the annual contribution. Costs are allocated to individual agencies based on exposure (payroll)
and experience (claims) relative to other members of the risk-sharing pool. Additional information
regarding the cost allocation methodology is provided below.
Liability
In the liability program, claims are pooled separately between police and general government exposures.
(1) The payroll of each member is evaluated relative to the payroll of other members. A variable
credibility factor is determined for each member, which establishes the weight applied to payroll and
the weight applied to losses within the formula. (2) The first layer of losses includes incurred costs up to
$30,000 for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the
first layer. (3) The second layer of losses includes incurred costs from $30,000 to $750,000 for each
occurrence and is evaluated as a percentage of the pool’s total incurred costs within the second layer. (4)
Incurred costs from $750,000 to $50 million, are distributed based on the outcome of cost allocation
within the first and second loss layers.
For 2016-17, the Authority’s pooled retention is $2 million per occurrence, with reinsurance to $20
million, and excess insurance to $50 million. The Authority’s reinsurance contracts are subject to the
following additional pooled retentions: (a) $2.5 million annual aggregate deductible in the $3 million x/s
$2 million layer, and (b) $3 million annual aggregate deductible in the $5 million x/s $10 million layer.
There is a third annual aggregate deductible in the amount of $2.5 million in the $5 million x/s $5 million
layer, however, it is fully covered under a separate policy and therefore, not retained by the Authority.
The overall coverage limit for each member, including all layers of coverage, is $50 million per
occurrence. Costs of covered claim for subsidence losses have a sub-limit of $30 million per occurrence.
Workers’ Compensation
The City of Azusa also participates in the workers’ compensation pool administered by the Authority.
In the workers’ compensation program, claims are pooled separately between public safety (police and
fire) and general government exposures. (1) The payroll of each member is evaluated relative to the
payroll of other members. A variable credibility factor is determined for each member, which establishes
the weight applied to payroll and the weight applied to losses within the formula. (2) The first layer of
losses includes incurred costs up to $50,000 for each occurrence and is evaluated as a percentage of the
pool’s total incurred costs within the first layer. (3) The second of losses includes incurred costs from
$50,000 to $100,000 for each occurrence and is evaluated as a percentage of the pool’s total incurred costs
within the second layer. (4) Incurred costs in excess from $100,000 to statutory limits are distributed
based on the outcome of cost allocation within the first and second loss layers.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
94
9. RISK MANAGEMENT, Continued
B. Self-Insurance Programs of the Authority, Continued
For 2019-20 the Authority’s pooled retention is $1 million per occurrence, with reinsurance to statutory
limits under California Workers’ Compensation Law.
Employer’s Liability losses are pooled among members to $1 million. Coverage from $1 million to $5
million is purchased as part of a reinsurance policy, and Employer’s Liability losses from $5 million to
$10 million are pooled among members.
C. Independent Cities Risk Management Authority (ICRMA)
Prior to July 1, 2017, the City was a member of Independent Cities Risk Management Authority (ICRMA)
for general liability and worker’s compensation claims. The City retains responsibility for its self-insured
portion of claims incurred prior to July 1, 2016.
D. Claim Liability
The City’s claims activity is recorded in its internal service funds. Estimated liabilities are recorded when
it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. Claims
that have been incurred but not reported (IBNRs) are also included in the liability estimates. A summary
of the changes in claims liabilities for the past three fiscal years follows.
Fiscal Year
Claims Claims and Claims
For the Years Payable Changes in Claims Payable Due Within
Ended June 30, July 1 Estimates Payments June 30 One Year
2018 3,232,622$ 1,049,005$ (1,494,245)$ 2,787,382$ 1,000,000$
2019 2,787,382 2,371,449 (1,580,817) 3,578,014 1,790,632
2020 3,578,014 3,423,783 (2,006,456) 4,995,341 3,207,959
During the past three fiscal years, none of the above programs of protection experienced settlements
or judgments that exceeded pooled or insured coverage. There were also no significant reductions in
pooled or insured liability coverage in 2019-20.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
95
10. SEGMENT OF ENTERPRISE ACTIVITIES
The City issued Sewer System Certificates of Participation to refinance a portion of the 1990 Local Agency
Revenue Bonds. The sewer department is accounted for in the Other Enterprise Funds as the
Sewer/Wastewater Fund. Summary information for the Sewer/Wastewater Fund for the year ended June 30,
2020, is as follows:
Assets:
Current assets $ 6,845,145
Restricted assets 1,375,513
Capital assets 8,451,256
Total assets 16,671,914
Deferred outflows of resources:
Deferred pension related items 258,334
Total deferred outflows of resources 258,334
Liabilities:
Current liabilities 616,951
Noncurrent liabilities 4,121,623
Total liabilities 4,738,574
Deferred inflows of resources
Deferred pension related items 40,286
Total deferred inflows of resources 40,286
Net position:
Net investment in capital assets 5,661,256
Restricted 1,375,513
Unrestricted 5,114,619
Total net position $ 12,151,388
Condensed Statement of Net Position
Sewer charges $ 3,292,951
Depreciation expense (489,347)
Other operating expenses (1,979,141)
Operating income 824,463
Nonoperating revenues(expenses):
Investment earnings 122,016
Interest expense (59,523)
Special franchise fees (66,229)
Transfers out (61,000)
Change in net position 759,727
Beginning net position, as restated 11,391,661
Ending net position $ 12,151,388
Condensed Statement of Revenues, Expenses
and Changes in Net Position
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
96
10. SEGMENTS OF ENTERPRISE ACTIVITIES, Continued
Net cash provided by (used in):
Operating activities $ 1,494,420
Noncapital financing activities (61,000)
Capital and related financing activities (540,752)
Investing activities 139,815
Net increase in cash 1,032,483
Beginning cash and cash equivalents 6,772,621
Ending cash and cash equivalents $ 7,805,104
Condensed Statement of Cash Flows
11. JOINT VENTURES
Southern California Public Power Authority
The City of Azusa is a member of the Southern California Public Power Authority (SCPPA), a public entity
organized under the laws of the State of California. The SCPPA was formed by a Joint Powers Agreement
dated as of November 1, 1980, pursuant to the Joint Exercise of Powers Act of the State of California. The
SCPPA’s participant membership consists of ten Southern California cities each operating an electric and one
public district of the State of California. The SCPPA was formed for the purpose of planning, financing,
developing, acquiring, constructing, operating and maintaining projects for the generation and transmission
of electric energy for sale to its participants. The Joint Powers Agreement has a term of 50 years. Complete
financial statements may be obtained from 1160 Nicole Court, Glendora, California 91740.
As of June 30, 2020, the City's entitlement of significant projects of SCPPA includes the following: 1% of
SCPPA's $877,646,000 investment (at cost) in the Palo Verde Nuclear Generating Station (with related SCPPA
indebtedness of $0), 1% of SCPPA's $58,463,000 investment (at cost) in Mead - Phoenix Transmission Project
(with related SCPPA indebtedness of $46,150), and 2.21% of SCPPA's $174,056,000 investment (at cost) in
Mead - Adelanto Transmission Project (with related SCPPA indebtedness of $342,108. Per SCCPA Joint
Powers Agreement, the distribution of any residual equity at event of SCCPA liquidation will be determined
by the SCCPA Board of Directors, as such no investment in joint venture in SCCPA is reported for the above
mentioned projects.
12. RATE STABILIZATION FUND
The City of Azusa has provided for a rate stabilization fund in the amount of $10,941,541 (presented in the
accompanying balance sheet as cash held for rate stabilization) to cover the difference between the City's cost
to provide electricity to its customers (including power charges for power purchased from other utilities in
which the City has a joint venture interest) and the local market price for electricity as established by a
regional power pool approved by the Federal Energy Regulatory Commission.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
97
13. RDA OBLIGATION RETIREMENT TRUST FUND (SUCCESSOR AGENCY) ACTIVITIES
A. Redevelopment Dissolution
In an effort to balance its budget, the State of California adopted ABx1 26 on June 28, 2011, amended by
AB1484 on June 27, 2012, which suspended all new redevelopment activities except for limited specified
activities as of that date and dissolved redevelopment agencies as of January 31, 2012.
The suspension provisions prohibited all redevelopment agencies from a wide range of activities,
including incurring new indebtedness or obligations, entering into or modifying agreements or contracts,
acquiring or disposing of real property, taking actions to adopt or amend redevelopment plans and other
similar actions, except actions required by law or to carry out existing enforceable obligations, as defined
in ABx1 26.
ABxl 26 and AB1484 allowed three regulatory oversight authorities, the Successor Authority's Oversight
Board, State Controller and Department of Finance (DOF), to review the former Authority's asset transfer,
obligation payments and wind down activities. ABxl 26 specifically directs the State Controller to review
the activities of all redevelopment agencies to determine whether an asset transfer between an agency
and any public agency occurred on or after January 1, 2011. If an asset transfer did occur and the public
agency that received the asset is not contractually committed to a third party for the expenditure or
encumbrance of the asset, the legislation purports to require the State Controller to order the asset
returned to the redevelopment agency. The State Controller completed its review in April 2016. The City
subsequently brought the asset transfer review to the Oversight Board. The transfer identified as required
to be returned in the asset transfer review was made during the FY 2016.
Effective January 31, 2012, all California redevelopment agencies were dissolved. Certain assets of the
Authority's Low and Moderate Income Housing Fund were distributed to a Housing Successor; and all
remaining Authority assets and liabilities were distributed to a Successor Agency.
Under the provisions of AB 1484, the City could elect to become the Housing Successor and retain the
housing assets. The City elected to become the Housing Successor and on January 24, 2012, and on
February 1, 2012 certain housing assets were transferred to the City's Housing Successor Special Revenue
Fund.
Cash and investments of the Successor Agency are discussed in Note 2 above.
B. Capital Assets
The Successor Agency assumed the capital assets of the former Redevelopment Agency as of February 1,
2012. All capital assets are valued at historical cost or estimated historical cost if actual historical cost is
not available. Contributed capital assets are valued at their estimated fair value on the date contributed.
The Successor Agency's policy is to capitalize all assets with costs exceeding certain minimum thresholds
and with useful lives exceeding two years.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
98
13. RDA OBLIGATION RETIREMENT TRUST FUND (SUCCESSOR AGENCY) ACTIVITIES,
Continued
B. Capital Assets, Continued
All capital assets with limited useful lives are depreciated over their estimated useful lives. The purpose
of depreciation is to spread the cost of capital assets equitably among all users over the life of these assets.
The amount charged to depreciation expense each year represents that year's pro rata share of the cost of
capital assets.
Depreciation of all capital assets is charged as an expense against operations each year and the total
amount of depreciation taken over the years, called accumulated depreciation, is reported on the balance
sheet as a reduction in the book value of capital assets.
Depreciation is provided using the straight line method, which means the cost of the asset is divided by
its expected useful life in years and the result is charged to expense each year until the asset is fully
depreciated. The Successor Agency has assigned the useful lives and capitalization thresholds listed
below to capital assets.
Buildings and Improvements 7 – 50 years
Furniture, Fixtures and Equipment 5 – 20 years
Automobiles and Trucks 2 – 10 years
Infrastructure 25–65 years
Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest
incurred during the construction phase is reflected in the capitalized value of the asset constructed, net of
interest earned on the invested proceeds over the same period.
Capital assets recorded at June 30 comprise:
Balance at Balance at
June 30, 2019 Additions Retirements June 30, 2020
Non Depreciable Assets:
Land 410,420$ -$ -$ 410,420$
Capital assets being depreciated:
Land Improvements 1,427,803 - - 1,427,803
Building and Structures 468,042 - - 468,042
Infrastructure 718,430 - - 718,430
Total capital assets being depreciated 2,614,275 - - 2,614,275
Less accumulated depreciation for:
Land Improvements 1,038,536 58,400 - 1,096,936
Building and Structures 397,831 46,803 - 444,634
Infrastructure 205,441 23,949 - 229,390
Total accumulated depreciation 1,641,808 129,152 - 1,770,960
Net capital assets being depreciated 972,467 (129,152) - 843,315
Capital Assets, net 1,382,887$ (129,152)$ -$ 1,253,735$
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
99
13. RDA OBLIGATION RETIREMENT TRUST FUND (SUCCESSOR AGENCY) ACTIVITIES,
Continued
C. Long-Term Debt
Tax Allocations Bonds and Loans
All of the long-term debt of the Successor Agency is comprised of Tax Allocation Bonds issued by the
Redevelopment Agency. The Bonds are special obligations of the Agency and are secured only by the
Agency's tax increment revenues. Tax Allocation Bond and loan transactions were as follows:
Balance Balance Due Within
June 30, 2019 Additions Deletions June 30, 2020 One Year
Fiduciary Funds
2014 Refunding TAB 7,590,000$ -$ (780,000)$ 6,810,000$ 820,000$
2015 Refunding TAB, Series A 14,315,000 - - 14,315,000 -
2015 Refunding TAB, Series B 15,065,000 - (330,000) 14,735,000 330,000
2017 Refunding TABS, Series A 2,815,000 - (675,000) 2,140,000 690,000
2017 Refunding TABS, Series B 3,385,000 - (205,000) 3,180,000 210,000
Unamortized premium (discount) 217,603 - (14,180) 203,423 -
Total Fiduciary Funds 43,387,603$ -$ (2,004,180)$ 41,383,423$ 2,050,000$
2014 Subordinate Tax Allocation Refunding Bonds, Series A
The Azusa Redevelopment Agency issued $10,470,000 of Subordinate Tax Allocation Refunding Bonds,
Series A, dated September 30, 2014. Proceeds of the bonds were to provide funds to refinance outstanding
bonds of the Successor Agency, satisfy the Reserve Requirement for the bond, and pay costs incurred in
connection with the issuance, sale and delivery of the Bonds. The bonds are due in annual installments
ranging from $180,000 to $1,900,000 maturing on August 1, 2015 through August 1, 2034. The bonds carry
interest rates of 2.00% and 5.00%. The economic gain on refunding was $2,288,197. The difference in cash
flow was $2,075,000. The outstanding principal balance at June 30, 2020, was $6,810,000.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
100
13. RDA OBLIGATION RETIREMENT TRUST FUND (SUCCESSOR AGENCY) ACTIVITIES,
Continued
C. Long-Term Debt, Continued
2014 Subordinate Tax Allocation Refunding Bonds, Series A, Continued
The annual requirements to amortize the outstanding bond indebtedness as of June 30, 2020, including
interest are as follows:
Year Ending June 30, Principal Interest Total
2021 820,000$ 275,644$ 1,095,644$
2022 855,000 233,769 1,088,769
2023 905,000 189,769 1,094,769
2024 1,900,000 130,894 2,030,894
2025 180,000 90,144 270,144
2026-2030 1,250,000 291,066 1,541,066
2031-2035 900,000 105,131 1,005,131
Total 6,810,000$ 1,316,417$ 8,126,417$
2015 Subordinate Tax Allocation Refunding Bonds, Series A & B
The Successor Agency to the Redevelopment Agency of the City of Azusa issued $30,530,000 of
Subordinate Tax Allocation Refunding Bonds, Series A & B, dated September 8, 2015. Proceeds of the
bonds were to provide funds to refinance outstanding bonds of the Successor Agency, satisfy the Reserve
Requirement for the bond, and pay costs incurred in connection with the issuance, sale and delivery of
the Bonds. The refunding resulted in a difference between the reacquisition price and the net carrying
amount of the old debt of $3,080,678, which is reported as a deferred outflow of resources in the
accompanying financial statements and amortized over the remaining life of the debt. The City completed
the refunding to reduce its total debt service payments by $2,755,111 and to obtain an economic gain
(difference between the present values of the old and new debt service payments) of $4,413,928. The bonds
are due in annual installments ranging from $315,000 to $2,635,000 maturing on August 1, 2016 through
August 1, 2036. The bonds carry interest rates of 1.00% and 4.50%.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
101
13. RDA OBLIGATION RETIREMENT TRUST FUND (SUCCESSOR AGENCY) ACTIVITIES,
Continued
C. Long-Term Debt, Continued
The annual requirements to amortize the outstanding bond indebtedness as of June 30, 2020, including
interest are as follows:
Year Ending
June 30, Principal Interest Total Principal Interest Total
2021 -$ 504,213$ 504,213$ 330,000$ 589,806$ 919,806$
2022 - 504,213 504,213 350,000 580,019 930,019
2023 - 504,213 504,213 355,000 569,000 924,000
2024 - 504,213 504,213 295,000 558,069 853,069
2025 - 504,213 504,213 2,000,000 515,406 2,515,406
2026-2030 2,535,000 2,479,869 5,014,869 8,785,000 1,336,366 10,121,366
2031-2035 8,985,000 1,442,906 10,427,906 2,620,000 67,950 2,687,950
2036-2040 2,795,000 72,581 2,867,581 - - -
Total 14,315,000$ 6,516,421$ 20,831,421$ 14,735,000$ 4,216,616$ 18,951,616$
2015 Subordinate Bond, Series A 2015 Subordinate Bond, Series B
2017 Tax Allocation Refunding Bonds, Series A & B
The Successor Agency to the Redevelopment Agency of the City of Azusa issued $7,125,000 of Tax
Allocation Bonds, Series A & B dated November 2, 2017. Proceeds of the bonds were used to provide
funds to refinance outstanding bonds of the Successor Agency, satisfy the Reserve Requirement for the
bond, and pay costs incurred in connection with the issuance, sale and delivery of the Bonds. The
refunding resulted in a difference between the reacquisition price and the net carrying amount of the old
debt of $151,451, which is reported as a deferred outflow of resources in the accompanying financial
statements and amortized over the remaining life of the debt. The City completed the refunding to achieve
approximately $1,441,324 in net savings (economic gain on refunding) over the remaining life of the bonds.
The bonds are due in annual installments ranging from $50,308 to $1,114,626 maturing on February 1,
2018 through August 1, 2032. The bonds carry interest rates of 3.13% and 2.59%.
The annual requirements to amortize the outstanding bond indebtedness as of June 30, 2020, including
interest are described on the following page.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
102
13. RDA OBLIGATION RETIREMENT TRUST FUND (SUCCESSOR AGENCY) ACTIVITIES,
Continued
C. Long-Term Debt, Continued
2017 Tax Allocation Refunding Bonds, Series A & B, Continued
Year Ending
June 30, Principal Interest Total Principal Interest Total
2021 690,000$ 56,184$ 746,184$ 210,000$ 79,643$ 289,643$
2022 715,000 34,195 749,195 210,000 74,204 284,204
2023 735,000 11,503 746,503 220,000 68,635 288,635
2024 - - - 225,000 62,872 287,872
2025 - - - 230,000 56,980 286,980
2026-2030 - - - 1,255,000 190,300 1,445,300
2031-2033 - - - 830,000 32,634 862,634
Total 2,140,000$ 101,882$ 2,241,882$ 3,180,000$ 565,267$ 3,745,267$
2017 Tax Allocation Refunding Bonds, Series A 2017 Tax Allocation Refunding Bonds, Series B
14. NEGATIVE FUND BALANCE
At June 30, 2020, the following funds reported negative fund balances:
LACMTA Special Revenue Fund $95,334
Capital Projects Fund $541
Consumer Services Internal Service Fund $5,205,551
Self Insurance Internal Service Fund $6,276,284
Equipment Replacement Internal Service Fund $305,307
IT Services Internal Service Fund $2,439,867
The City believes the above noted deficits will be eliminated by and future service charges and/or interfund
transfers.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
103
15. FUND BALANCE/NET POSITION DEFICIT AND EXPENDITURES IN EXCESS OF
APPROPRIATIONS
The following funds had expenditures in excess of appropriations:
The expenditures in excess of appropriations for Fire Safety was due to the recording of credits against
expenditures as revenues thus grossing up the expenditures. The Fire Safety expenditures net of credits
was $5,437,991, resulting in a net amount of $258,354 under budget. Senior Nutrition was over in meals
and payroll due to the pandemic. Monrovia Nursery was increased payroll and landscaping costs. And
Measure R was related to a late transfer of gas tax.
16. COMITTMENTS AND CONTINGENCIES
The City of Azusa has been named as a defendant in numerous lawsuits and claims arising in the course
of operations. In the aggregate, these claims seek monetary damages in significant amounts. To the extent
the outcome of such litigation has been determined to result in probable financial loss to the City, such
loss have been accrued in the accompanying combined financial statements.
Encumbrances outstanding as of June 30, 2020, were as listed below:
Major Funds
Fire Safety Special Revenue Fund 1,257,740$
Non-Major Governmental Funds:
Special Revenue Funds:
Senior Nutrition 67,445
Monrovia Nursery 1,674
Measure R 153,354
Amount
Major Governmental Fund:
General Fund 330,955$
Total Major Governmental Funds 330,955
Non-Major Governmental Funds:
Special Revenue Funds:
Measure R 782,863
Measure M 8,266
Proposition A 10,230
Proposition C 645,360
Community Development Block Grant 15,100
Energy Efficient Program 99,354
Grant & Seizure Fund 487,713
MTA Grant 526,857
Total Non-Major Governmental Funds 2,575,743
Total Governmental Fund Encumbrances 2,906,698$
.
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
104
17. PRIOR PERIOD ADJUSTMENTS
The City recorded a prior period adjustments to adjust prior year receivables and to reclassify unearned fees
collected in advance.
Government-Wide Statements
Fund Statements
18. COVID-19 PANDEMIC
During December 2019, the Novel Corona Virus Disease (COVID-19) was discovered. The World Health
Organization subsequently declared the COVID-19 a worldwide pandemic on March 11, 2020. On March 4,
2020, California State Governor Gavin Newsom proclaimed a State of Emergency because of the threat of the
COVID-19 in the State of California, leading to the County of Los Angeles Health Officer issuing a stay-at-
home directive on March 18, 2020. This halted all business within the County of Angeles, including the City
of Azusa outside of essential activities.
The COVID-19 pandemic had minimal impact on the City’s overall revenues. Third quarter revenues
citywide were impacted by discontinuance of late fees and penalties for multiple services in an effort to
provide community financial relief. However, upon issuance of the stay-at-home directive, the City quickly
pivoted to providing virtual and enhanced online services, took advantage of grant opportunities used for
city operations and residential and business assistance, and applied for state and federal relief funding, which
mitigated the impact to revenues. Additionally, sales tax and property tax revenues were stronger than
anticipated and so overall revenue collections were in line with projections.
Net Position Net Position
as Previously as
Reported Receivables Restated
Government-Wide Statements
Governmental Activities (26,292,313)$ 256,522$ (26,035,791)$
Prior Period Adjustment
Fund Balance,
as Previously
Reported Receivables
Fund Balance,
as
Restated
Fund Statements
Governmental Funds
General Fund $ 27,351,315 246,578$ $ 27,597,893
Non-Major Governmental Funds* 17,849,061 9,944 17,859,005
Prior Period Adjustments
City of Azusa
Notes to Basic Financial Statements
For the year ended June 30, 2020
105
19. SUBSEQUENT EVENTS
On September 17, 2020, the City issued Taxable Pension Obligation Bonds, Series 2020 by and between the
City and Wilmington Trust, National Association, as trustee of par value $70,075,000 to refund the City’s
obligation to pay its unfunded actuarial liability to the California Public Employees’ Retirement System
(PERS) under the PERS Contract for the benefit of the City’s employees.
106
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107
REQUIRED
SUPPLEMENTARY INFORMATION
City of Azusa
Required Supplementary Information
For the year ended June 30, 2020
108
1. SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS – CALPERS
AGENT MULTIPLE-EMPLOYER PLAN – LAST 10 YEARS*
Notes to Schedule:
* Intended to display information for ten years, additional years’ information will be displayed as it
becomes available.
Benefit Changes: The figures above do not include any liability impact that may have resulted from plan
changes which occurred after the June 30, 2016 valuation date. This applies for voluntary benefit changes
as well as any offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes).
Changes of Assumptions: In 2017, the accounting discount rate reduced from 7.65 percent to 7.15 percent.
In 2016, there were no changes. In 2015, amounts reported reflect an adjustment of the discount rate from
7.5 percent (net of administrative expense) to 7.65 percent (without a reduction for pension plan
administrative expense.) In 2014, amounts reported were based on the 7.5 percent discount rate.
2018-19 2017-18 2016-17 2015-16 2014-15 2013-14
TOTAL PENSION LIABILITY
Service Cost 2,642,631$ 2,632,487$ 2,520,416$ 2,295,028$ 2,302,623$ 2,375,239$
Interest 10,746,822 10,139,454 9,773,270 9,381,992 8,989,759 8,658,209
Difference Between Expected and Actual Experience 2,523,996 (525,331) (454,282) (892,890) (1,723,872) -
Changes of Assumptions - (546,545) 8,401,425 - (2,292,502) -
Benefit Payments, Including Refunds of Employee Contributions (7,114,634) (6,498,070) (5,814,688) (5,561,682) (4,975,226) (4,845,540)
Net Change in Total Pension Liability 8,798,815 5,201,995 14,426,141 5,222,448 2,300,782 6,187,908
Total Pension Liability - Beginning 150,017,209 144,815,214 130,389,073 125,166,625 122,865,843 116,677,935
Total Pension Liability - Ending (a)158,816,024$ 150,017,209$ 144,815,214$ 130,389,073$ 125,166,625$ 122,865,843$
PLAN FIDUCIARY NET POSITION
Contributions - Employer 3,622,928$ 3,137,989$ 2,602,264$ 2,381,498$ 1,979,679$ 2,043,584$
Contributions - Employee 1,282,651 1,336,844 1,191,434 1,066,129 1,032,337 1,029,164
Difference in projected and actual earnings - - - - - -
Plan to plan resource movement 19,282 (263) (20) - (145) -
Net Investment Income 7,446,456 9,044,754 10,722,195 522,172 2,198,171 14,908,401
Benefit Payments, Including Refunds of Employee Contributions (7,114,634) (6,498,070) (5,814,688) (5,561,682) (4,975,226) (4,845,540)
Other Changes in Fiduciary Net Position (80,606) (482,393) (145,026) (60,872) (112,413) -
Net Change in Fiduciary Net Position 5,176,077 6,538,861 8,556,159 (1,652,755) 122,403 13,135,609
Plan Fiduciary Net Position - Beginning 113,322,627 106,783,766 98,227,607 99,880,362 99,757,959 86,622,350
Plan Fiduciary Net Position - Ending (b)118,498,704$ 113,322,627$ 106,783,766$ 98,227,607$ 99,880,362$ 99,757,959$
Plan Net Position Liability/(Asset) - Ending (a) - (b)40,317,320$ 36,694,582$ 38,031,448$ 32,161,466$ 25,286,263$ 23,107,884$
Plan Fiduciary Net Position as a Percentage of the
Total Pension Liability 74.61% 75.54% 73.74% 75.33% 79.80% 81.19%
Covered Payroll 15,853,565$ 15,617,508$ 14,940,224$ 15,065,169$ 15,305,919$ 14,720,773$
Plan Net Pension Liability/(Asset) as a Percentage of Covered Payroll 254.31% 234.96% 254.56% 213.48% 165.21% 156.97%
Measurement Period
City of Azusa
Required Supplementary Information
For the year ended June 30, 2020
109
2. SCHEDULE OF CONTRIBUTIONS – CALPERS AGENT MULTIPLE-EMPLOYER PLAN – LAST 10
YEARS*
3. SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY – COST SHARING
MULTIPLE-EMPLOYER PLAN – LAST 10 YEARS*
2020 2019 2018 2017 2016 2015 2014
Misellaneous
Actuarially Required Contributions 4,199,277$ 3,628,442$ 3,143,487$ 2,602,264$ 2,381,498$ 1,979,679$ 2,043,584$
Contribution in Relation to the
Actuarially Required Contributions (4,199,277) (3,628,442) (3,143,487) (2,602,264) (2,381,498) (1,979,679) (2,043,584)
Contribution Deficiency(Excess)- - - - - - -
Covered Payroll 16,687,339$ 15,396,189$ 14,947,756$ 15,065,169$ 14,113,224$ 14,429,034$ 15,121,206$
Contributions as a Percentage of Covered Payroll 25.16% 23.57% 21.03% 17.27% 16.87% 13.72% 13.51%
Note to Schedules
*Fiscal year 2015 was the 1st year of implementation, therefore only seven years are shown.
Methods and assumptions used to determine contribution rates:
Valuation date : 6/30/2017 6/30/2016 6/30/2015 6/30/2014 6/30/2013 6/30/2012 6/30/2011
Actuarial cost method: Entry Age Entry Age Entry Age Entry Age Entry Age Entry Age Entry Age
Amortization method: (1) (1) (1) (1) (1) (1) (1)
Assets valuation method: Market Value Market Value Market Value Market Value Market Value 15 Year
Smoothed
Market
Method
15 Year
Smoothed
Market
Method
Inflation: 2.63% 2.75% 2.75% 2.75% 2.75% 2.75% 2.75%
Salary increases: (2)(2)(2)(2)(2)(2)(2)
Investment rate of return: 7.25% 7.375% 7.50% 7.50% 7.50% 7.50% 7.50%
Retirement age: (3)(3)(3)(3)(3)(3)(3)
Mortality: (4)(4)(4)(4)(4)(4)(4)
(1)Level percentage of payroll, closed
(2)Depending on age, service, and type of employment
(3)50 for all plans, with the exception of 52 for Miscellaneous PEPRA 2%@62
(4)
Fiscal year:
Mortality assumptions are based on mortality rates resulting from the most recent CalPERS
Experience Study adopted by the CalPERS Board.
Measurement date:6/30/2019 6/30/2018 6/30/2017 6/30/2016 6/30/2015 6/30/2014
Proportion of the net pension liability 0.36592% 0.35940% 0.34445% 0.34338% 0.33263% 0.31257%
Proportionate share of the net pension liability 37,495,554$ 34,632,337$ 34,160,281$ 29,713,239$ 22,831,275$ 19,449,591$
Covered payroll 4,698,150$ 4,561,311$ 3,648,273$ 5,940,696$ 6,649,731$ 6,343,000$
Proportionate share of the net pension liability as a
percentage of covered payroll 798.09% 759.26% 936.34% 500.16% 343.34% 306.63%
Plan's share of fiduciary net position as a percentage
of total pension liability 75.26% 75.26% 73.31% 74.06% 78.40% 79.82%
City of Azusa
Required Supplementary Information
For the year ended June 30, 2020
110
3. SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY – COST SHARING
MULTIPLE-EMPLOYER PLAN – LAST 10 YEARS, Continued
Notes to Schedule:
* Intended to display information for ten years, additional years’ information will be displayed as it
becomes available.
Benefit Changes: The figures above do not include any liability impact that may have resulted from plan
changes which occurred after the June 30, 2014 valuation date. This applies for voluntary benefit changes
as well as any offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes).
Changes of Assumptions: The discount rate was changed from 7.5 percent (net of administration expense)
to 7.65 percent.
4. SCHEDULE OF CONTRIBUTIONS – COST SHARING MULTIPLE-EMPLOYER PLAN – LAST 10
YEARS*
2020 2019 2018 2017 2016 2015
Contractually required contribution (actuarially
determined)3,716,215$ 3,294,240$ 3,080,129$ 2,711,578$ 2,408,176$ 2,475,434$
Contribution in relation to the actuarially
determined contributions (3,716,215) (3,294,240) (3,080,129) (2,711,578) (2,408,176) (2,475,434)
Contribution deficiency (excess)-$ -$ -$ -$ -$ -$
Covered payroll 5,858,623$ 4,698,150$ 4,561,311$ 3,648,273$ 5,940,696$ 6,649,731$
Contributions as a percentage of covered payroll 63.43% 70.12% 67.53% 74.32% 40.54% 37.23%
Note to Schedules
*Fiscal year 2015 was the 1st year of implementation, therefore only six years are shown.
Methods and assumptions used to determine contribution rates:
Valuation date : 6/30/2017 6/30/2016 6/30/2015 6/30/2014 6/30/2013 6/30/2012
Actuarial cost method: Entry Age Entry Age Entry Age Entry Age Entry Age Entry Age
Amortization method: (1) (1) (1) (1) (1) (1)
Assets valuation method: Market Value Market Value Market Value Market Value Market Value 15 Year
Smoothed
Market Method
Inflation: 2.63%2.75%2.75%2.75%2.75%2.75%
Salary increases: (2)(2)(2)(2)(2)(2)
Investment rate of return: 7.25%7.375%7.50%7.50%7.50%7.50%
Retirement age: (3)(3)(3)(3)(3)(3)
Mortality: (4)(4)(4)(4)(4)(4)
(1)Level percentage of payroll, closed
(2)Depending on age, service, and type of employment
(3)50 for all plans, with the exception of 52 for Miscellaneous PEPRA 2%@62
(4)Mortality assumptions are based on mortality rates resulting from the most recent CalPERS Experience
Study adopted by the CalPERS Board.
City of Azusa
Required Supplementary Information
For the year ended June 30, 2020
111
5. SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS – AMMA
PARS RETIREMENT ENHANCEMENT PLAN – LAST 10 YEARS*
* Intended to display information for ten years, additional years’ information will be displayed as it becomes
available.
2019 2018 2017 2016 2015
TOTAL PENSION LIABILITY
Service Cost 123,963$ 120,352$ 91,040$ 88,388$ 102,116$
Interest 250,344 233,644 232,756 216,255 207,196
Effect of Economic/Demographics Gains or Losses - (191,660) - (221,832) -
Effect of Assumption Changes or Inputs - 204,190 - 131,142 -
Benefit Payments, Including Refunds of Employee Contributions (135,620) (91,529) (75,963) (67,291) (83,368)
Net Change in Total Pension Liability 238,687 274,997 247,833 146,662 225,944
Total Pension Liability - Beginning 3,794,220 3,519,223 3,271,390 3,124,728 2,898,784
Total Pension Liability - Ending (a)4,032,907$ 3,794,220$ 3,519,223$ 3,271,390$ 3,124,728$
PLAN FIDUCIARY NET POSITION
Benefit Payments, Including Refunds of Employee Contributions (135,620)$ (91,529)$ (75,963)$ (67,291)$ (83,368)$
Contributions - Employer 195,062 205,227 201,498 172,625 138,866
Contributions - Employee 41,008 49,912 48,741 43,558 46,205
Net Investment Income 178,824 182,437 250,204 (6,961) 47,672
Administrative Expenses (9,127) (8,933) (8,505) (11,509) (8,240)
Net Change in Fiduciary Net Position 270,147 337,114 415,975 130,422 141,135
Plan Fiduciary Net Position - Beginning 2,791,391 2,454,277 2,038,302 1,907,880 1,766,745
Plan Fiduciary Net Position - Ending (b)3,061,538$ 2,791,391$ 2,454,277$ 2,038,302$ 1,907,880$
Plan Net Position Liability/(Asset) - Ending (a) - (b)971,369$ 1,002,829$ 1,064,946$ 1,233,088$ 1,216,848$
Plan Fiduciary Net Position as a Percentage of the
Total Pension Liability 75.91%73.57%69.74%62.31%61.06%
Covered Payroll 1,640,350$ 2,233,000$ 1,937,372$ 1,880,944$ 2,128,243$
Plan Net Pension Liability/(Asset) as a Percentage of
Covered Payroll 59.22%44.91%54.97%65.56%57.18%
Measurement Period
City of Azusa
Required Supplementary Information
For the year ended June 30, 2020
112
6. SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS –
EXECUTIVE PARS RETIREMENT ENHANCEMENT PLAN – LAST 10 YEARS*
* Intended to display information for ten years, additional years’ information will be displayed as it becomes
available.
Measurement Period 2019 2018 2017 2016 2015
TOTAL PENSION LIABILITY
Interest 198,591$ 194,748$ 206,088$ 201,357$ 176,286$
Effect of Economic/Demographics Gains or Losses - (131,702) - 201,732 -
Effect of Assumption Changes or Inputs - 177,244 - 106,795 -
Benefit Payments, Including Refunds of Employee Contributions (194,071) (168,659) (139,808) (127,936) (125,424)
Net Change in Total Pension Liability 4,520 71,631 66,280 381,948 50,862
Total Pension Liability - Beginning 3,150,748 3,079,117 3,012,837 2,630,889 2,580,027
Total Pension Liability - Ending (a)3,155,268$ 3,150,748$ 3,079,117$ 3,012,837$ 2,630,889$
PLAN FIDUCIARY NET POSITION
Benefit Payments, Including Refunds of Employee Contributions (194,071)$ (168,659)$ (139,808)$ (127,936)$ (125,424)$
Contributions - Employer 188,693 110,296 124,997 97,284 78,751
Net Investment Income 64,229 75,114 112,249 (5,857) 26,218
Administrative Expenses (5,397) (5,416) (4,982) (8,348) (5,569)
Net Change in Fiduciary Net Position 53,454 11,335 92,456 (44,857) (26,024)
Plan Fiduciary Net Position - Beginning 1,054,300 1,042,965 950,509 995,366 1,021,390
Plan Fiduciary Net Position - Ending (b)1,107,754$ 1,054,300$ 1,042,965$ 950,509$ 995,366$
Plan Net Position Liability/(Asset) - Ending (a) - (b)2,047,514$ 2,096,448$ 2,036,152$ 2,062,328$ 1,635,523$
Plan Fiduciary Net Position as a Percentage of the
Total Pension Liability 35.11%33.46%33.87%31.55%37.83%
Covered Payroll 769,086$ 747,000$ 692,804$ 672,625$ 990,274$
Plan Net Pension Liability/(Asset) as a Percentage of
Covered Payroll 266.23% 280.65% 293.90% 306.61% 165.16%
City of Azusa
Required Supplementary Information
For the year ended June 30, 2020
113
7. SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS – IBEW
PARS RETIREMENT ENHANCEMENT PLAN – LAST 10 YEARS*
* Intended to display information for ten years, additional years’ information will be displayed as it becomes
available.
Measurement Period 2019 2018 2017 2016 2015
TOTAL PENSION LIABILITY
Service Cost 98,500$ 95,631$ 103,488$ 100,474$ 107,529$
Interest 244,368 220,449 223,883 210,235 199,129
Effect of Economic/Demographics Gains or Losses - (18,551) - (61,026) -
Effect of Assumption Changes or Inputs - 219,186 - 28,545 -
Benefit Payments, Including Refunds of Employee Contributions (163,726) (139,841) (113,110) (124,197) (93,243)
Net Change in Total Pension Liability 179,142 376,874 214,261 154,031 213,415
Total Pension Liability - Beginning 3,741,580 3,364,706 3,150,445 2,996,414 2,782,999
Total Pension Liability - Ending (a)3,920,722$ 3,741,580$ 3,364,706$ 3,150,445$ 2,996,414$
PLAN FIDUCIARY NET POSITION
Benefit Payments, Including Refunds of Employee Contributions (163,726)$ (139,841)$ (113,110)$ (124,197)$ (93,243)$
Contributions - Employer 247,341 199,529 207,056 214,921 153,146
Contributions - Employee 61,521 72,702 76,124 79,015 82,044
Net Investment Income 164,679 163,582 225,263 (4,679) 41,194
Administrative Expenses (8,951) (8,682) (8,238) (10,938) (7,492)
Net Change in Fiduciary Net Position 300,864 287,290 387,095 154,122 175,649
Plan Fiduciary Net Position - Beginning 2,503,251 2,215,961 1,828,866 1,674,744 1,499,095
Plan Fiduciary Net Position - Ending (b)2,804,115$ 2,503,251$ 2,215,961$ 1,828,866$ 1,674,744$
Plan Net Position Liability/(Asset) - Ending (a) - (b)1,116,607$ 1,238,329$ 1,148,745$ 1,321,579$ 1,321,670$
Plan Fiduciary Net Position as a Percentage of the
Total Pension Liability 71.52%66.90%65.86%58.05%55.89%
Covered Payroll 3,076,052$ 3,635,000$ 3,805,104$ 4,117,972$ 4,060,559$
Plan Net Pension Liability/(Asset) as a Percentage of
Covered Payroll 36.30%34.07%30.19%32.09%32.55%
City of Azusa
Required Supplementary Information
For the year ended June 30, 2020
114
8. SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS – SEIU
PARS RETIREMENT ENHANCEMENT PLAN – LAST 10 YEARS*
* Intended to display information for ten years, additional years’ information will be displayed as it becomes
available.
2019 2018 2017 2016 2015
TOTAL PENSION LIABILITY
Service Cost 21,002$ 20,390$ 16,140$ 15,670$ 18,174$
Interest 41,101 40,393 40,470 37,853 32,199
Effect of Economic/Demographics Gains or Losses - (60,298) - 38,614 -
Effect of Assumption Changes or Inputs - 34,766 - 9,089 -
Bene fit Payments, Including Refunds of
Employee Contributions (31,800) (18,354) (16,780) (16,451) (13,203)
Net Change in Total Pension Liability 30,303 16,897 39,830 84,775 37,170
Total Pension Liability - Beginning 626,969 610,072 570,242 485,467 448,297
Total Pension Liability - Ending (a) 657,272$ 626,969$ 610,072$ 570,242$ 485,467$
PLAN FIDUCIARY NET POSITION
Bene fit Payments, Including Refunds of
Employee Contributions (31,800)$ (18,354)$ (16,780)$ (16,451)$ (13,203)$
Contributions - Employer 27,081 26,688 26,555 24,410 12,890
Contributions - Employee 23,319 28,696 28,554 26,100 25,312
Net Investment Income 30,060 29,408 39,629 (863) 7,232
Administrative Expenses (2,425) (2,193) (1,808) (5,041) (1,510)
Net Change in Fiduciary Net Position 46,235 64,245 76,150 28,155 30,721
Plan Fiduciary Net Position - Beginning 458,839 394,594 318,444 290,289 259,568
Plan Fiduciary Net Position - Ending (b)505,074$ 458,839$ 394,594$ 318,444$ 290,289$
Plan Net Position Liability/(Asset) - Ending (a) - (b)152,198$ 168,130$ 215,478$ 251,798$ 195,178$
Plan Fiduciary Net Position as a Percentage of the
Total Pension Liability 76.84%73.18%64.68%55.84%59.80%
Covered Payroll 582,987$ 649,000$ 561,325$ 544,976$ 620,510$
Plan Net Pension Liability/(Asset) as a Percentage of
Covered Payroll 26.11%25.91%38.39%46.20%31.45%
Measurement Period
City of Azusa
Required Supplementary Information
For the year ended June 30, 2020
115
9. SCHEDULE OF CONTRIBUTIONS –PARS RETIREMENT ENHANCEMENT PLANS – LAST 10
YEARS*
* Intended to display information for ten years, additional years’ information will be displayed as it becomes
available.
2020 2019 2018 2017 2016 2015
AMMA Bargaining Group
Actuarially determined contribution 256,816$ 188,640$ 246,301$ 213,675$ 173,709$ 212,245$
Contribution in relation to the actuarially determined contributi o (195,062) (189,833) (205,227) (201,498) (172,526) (138,866)
Contribution deficiency (excess) 61,754$ (1,193)$ 41,074$ 12,177$ 1,183$ 73,379$
Covered payroll 2,233,183$ 1,640,350$ 2,233,183$ 1,937,372$ 1,880,944$ 2,128,243$
Contributions as a percentage of covered payroll 8.73% 11.57% 9.19% 10.40% 9.17% 6.52%
Executive/ Contract Bargaining Group
Actuarially determined contribution 185,999$ 191,579$ 188,891$ 175,353$ 91,425$ 138,680$
Contribution in relation to the actuarially determined contributi o (188,693) (197,377) (110,296) (124,997) (97,284) (78,751)
Contribution deficiency (excess) (2,694)$ (5,798)$ 78,595$ 50,356$ (5,859)$ 59,929$
Covered payroll 746,686$ 769,086$ 746,686$ 692,804$ 672,625$ 990,274$
Contributions as a percentage of covered payroll 25.27% 25.66% 14.77% 18.04% 14.46% 7.95%
IBEW Employees
Actuarially determined contribution 268,796$ 228,858$ 199,203$ 208,580$ 214,921$ 220,708$
Contribution in relation to the actuarially determined contributi o (247,341) (259,694) (199,529) (207,056) (214,921) (153,146)
Contribution deficiency (excess) 21,455$ (30,836)$ (326)$ 1,524$ -$ 67,562$
Covered payroll 3,612,855$ 3,076,052$ 3,635,100$ 3,805,104$ 4,117,972$ 4,060,559$
Contributions as a percentage of covered payroll 6.85% 8.44% 5.49% 5.44% 5.22% 3.77%
SEIU Bargaining Group
Actuarially determined contribution 30,688$ 27,575$ 36,975$ 31,990$ 19,683$ 23,063$
Contribution in relation to the actuarially determined contributi o (27,081) (27,039) (26,688) (26,555) (24,410) (12,890)
Contribution deficiency (excess) 3,607$ 536$ 10,287$ 5,435$ (4,727)$ 10,173$
Covered payroll 648,802$ 582,987$ 648,802$ 561,325$ 544,976$ 620,510$
Contributions as a percentage of covered payroll 4.17% 4.64% 4.11% 4.73% 4.48% 2.08%
Note to Schedule
Valuation date:
Methods and assumptions used to determine contribution rates:
Single and Agent Employers Example
Amortization method
Remaining amortization period
Asset valuation method
Inflation
Salary increases
Investment rate of return
Retirement age
Mortality
Post-retirement: CalPERS 1997-2011
Healthy Retiree Tables
Entry age
Level percentage of payroll, closed
9.5 years
5-year smoothed market
2.75%
Pre-retirement: Consistent with the Non-
Industrial Rates used to value the Misc
Public Agency CalPERS Pension Plans
(1) Historical information is required only for measurement periods for which GASB 68 is applicable
6/30/2017
12.2% for 0 years of service, reduced as the
years of service increased, to 3.5% for 30 or
more years of services
6.50%
67 yrs.
City of Azusa
Required Supplementary Information
For the year ended June 30, 2020
116
10. SCHEDULE OF CHANGES IN THE CITY’S TOTAL OPEB LIABILITY AND RELATED RATIOS –
LAST 10 YEARS*
Notes to Schedule:
* Intended to display information for ten years, additional years’ information will be displayed as it
becomes available.
Benefit Changes: None.
Changes of Assumptions: The inflation assumption was updated from 2.50% to 2.75%, healthcare cost
trend rate was updated using the Society of Actuaries Getzen Model of Long-Run Medical Cost Trends,
demographic assumptions were updated to CalPERS 1997-2015 Experience Study, mortality improvement
scale was updated to Scale MP-2018, and participation assumption was updated for some bargaining
groups in fiscal year 2019. The discount rate was changed from 3.50 percent to 2.21 percent in fiscal year
2020.
2020 2019 2018 2017
Total OPEB liability
Service cost $ 1,847,881 $ 1,809,103 $ 1,756,411 $ 1,705,253
Interest on the total pension liability 1,740,015 1,485,140 1,348,787 1,275,916
Differences between actual and expected
experience - 1,960,757 - -
Changes in assumptions 12,972,999 3,180,597
Changes in benefit terms - - - -
Benefit payments (1,281,210) (1,103,260) (933,743) (864,576)
Net changes 15,279,685 7,332,337 2,171,455 2,116,593
Total OPEB liability - beginning of year 48,507,422 41,175,085 39,003,630 36,887,037
Total OPEB liability - end of year 63,787,107 48,507,422 41,175,085 $ 39,003,630
Covered-employee payroll $ 30,787,234 $ 26,654,981 $ 20,340,713 $ 20,340,713
City's total OPEB liability as a percentage of
covered-employee payroll 207.19% 181.98% 202.43% 191.75%
City of Azusa
Required Supplementary Information
For the year ended June 30, 2020
117
11. BUDGET INFORMATION
General Budget Policies
The City adheres to the following procedures in establishing the budgetary data reflected in its financial
statements:
1. In May of each year, the City Manager submits to the City Council a proposed financial plan with an
annual operating budget for the upcoming fiscal year commencing July 1. The operating budget includes
proposed expenditures and the sources of financing.
2. Public hearings are conducted at City Council meetings to obtain taxpayer comments.
3. On or before July 1, the financial plan for the fiscal year is adopted by Council action.
4. The City Manager is authorized to transfer funds appropriated with respect to those classifications
designated as other services and material and supplies within the same department. The City Manager
may transfer appropriated funds from any classification within other expenditure categories to the capital
outlay classification within the same department only; however, any revisions that alter the total
expenditures of any department must be approved by the City Council. Activities of the General Fund,
Special Revenue Funds, Capital Projects Funds and Debt Service Funds are included in the annual
appropriated budget. As an additional internal control mechanism, project-length financial plans are
adopted for the Capital Improvement Program. The level of budgetary control (that is, the level at which
expenditures cannot legally exceed the appropriated amount) is established at the department level
within the General Fund and at the fund level for total expenditures and transfers out for all other
budgeted funds.
5. Formal budgetary integration is employed as a management control device during the year for the
governmental funds.
6. Legally adopted budgets for all governmental funds are established on a basis consistent with generally
accepted accounting principles (GAAP).
Excess of Expenditures Over Appropriation
For purposes of evaluating legal compliance at the budgetary level of control (that is, the level at which
expenditures cannot legally exceed the appropriated amount), control is established at the department
level within the General Fund and at the fund level for total expenditures and transfers out for all other
budgeted funds.
City of Azusa
Required Supplementary Information
General Fund Budgetary Comparison Schedule by Department
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1, as restated 27,597,893$ 27,597,893$ 27,597,893$ -$
Resources (Inflows):
Taxes 34,452,866 34,352,866 35,864,262 1,511,396
Assessments 3,459,193 3,459,193 2,547,233 (911,960)
Licenses and permits 1,037,962 867,962 741,943 (126,019)
Intergovernmental 240,336 314,336 508,616 194,280
Charges for services 1,967,063 1,847,063 3,123,002 1,275,939
Use of money and property 574,750 774,750 1,087,499 312,749
Fines and forfeitures 1,274,200 1,374,200 1,383,846 9,646
Contributions 6,000 6,000 3,936 (2,064)
Miscellaneous 200,000 200,000 1,134,022 934,022
Transfers in 1,497,450 1,497,450 1,497,450 -
Proceeds from sale of capital assets - - 8,618 8,618
Amounts available for appropriations 72,307,713 72,291,713 75,498,320 3,206,607
Charges to Appropriations (Outflows):
General government
City Council 145,145 145,145 138,736 6,409
City Attorney 275,000 275,000 266,362 8,638
Administration 434,721 434,721 323,663 111,058
Promotion/Membership 177,092 202,092 200,082 2,010
City Clerk 663,330 671,252 673,935 (2,683)
Library Services - General 1,370,105 1,370,105 1,230,173 139,932
Library Services - Youth 31,430 161,330 68,152 93,178
Finance - Accounting 1,315,885 1,315,885 1,192,119 123,766
Cash Management 190,365 190,365 130,767 59,598
Purchasing 240,735 240,735 251,974 (11,239)
Printing Services 8,600 8,600 5,889 2,711
Human Resources 482,395 482,395 432,335 50,060
City-wide 3,156,656 2,046,656 3,015,275 (968,619)
Admin Services / Business Lic 5,404 5,404 2,086 3,318
Business License 227,195 227,195 173,705 53,490
Public Safety
Police 19,870,791 19,870,791 18,262,506 1,608,285
Emergency Services 9,190 9,190 55,434 (46,244)
Police Department Contracts 1,180,200 1,180,200 1,020,207 159,993
INF 518,336 538,836 484,283 54,553
Community development
Planning 665,701 807,561 395,588 411,973
Building regulation 874,746 1,024,746 819,499 205,247
Code Enforcement 934,091 934,091 897,178 36,913
Other 155,200 223,868 81,473 142,395
Parks and recreation
Recreation 1,818,996 1,818,996 1,337,962 481,034
Parks and maintenance 2,223,168 2,223,168 1,992,303 230,865
Senior programs 227,185 227,185 116,437 110,748
Women's Club - - 6,928 (6,928)
Public works
Engineering Services 188,285 198,285 72,193 126,092
Graffiti Removal 123,025 123,025 139,325 (16,300)
Facilities Maintenance 710,255 710,255 635,533 74,722
Capital outlay 110,395 110,395 107,475 2,920
Debt service:
Principal retirement 593,946 593,946 42,553 551,393
Interest and fiscal charges 40,863 71,386 59,079 12,307
Transfers out 6,966,658 6,966,658 6,966,658 -
Total charges to appropriations 45,935,089 45,409,462 41,597,867 3,811,595
Budgetary fund balance, June 30 26,372,624$ 26,882,251$ 33,900,453$ 7,018,202$
Budget Amounts
118
City of Azusa
Required Supplementary Information
Fire Safety Special Revenue Fund Budgetary Comparison Schedule
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 675,665$ 675,665$ 675,665$ -$
Resources (Inflows):
Charges for services 100,000 100,000 1,516,094 1,416,094
Transfers in 5,696,345 5,696,345 5,696,345 -
Amounts available for appropriations 6,472,010 6,472,010 7,888,104 1,416,094
Charges to Appropriations (Outflows):
Public safety 5,696,345 5,696,345 6,954,085 (1,257,740)
Total charges to appropriations 5,696,345 5,696,345 6,954,085 (1,257,740)
Budgetary fund balance, June 30 775,665$ 775,665$ 934,019$ 158,354$
Budget Amounts
119
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120
SUPPLEMENTARY INFORMATION
121
NON-MAJOR GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS
Special revenue funds are used to acount for revenues that are legally restricted to expenditures for particular purposes
Grant and Seizure Special Revenue Fund
To account for various federal, state, and local grants which the City receives.
State Gasoline Tax
To account for Highways Users Tax funds received. The State imposes excise taxes on transportation fuels. Taxes on
fuel used for motor vehicles is transferred to the Highways Users Tax Account and is apportioned to cities under
population-based formulas contained in the State Streets and Highways code. These funds are used for street
maintenance and construction.
Proposition A
This fund is used to account for restricted Proposition A monies and related expenditures.
Proposition C
This fund is used to account for restricted Proposition C monies and related expenditures.
Community Development Block Grant
This fund accounts for grants received indirectly from the U.S. Department of Housing and Urban Development's
Community Block Grant Program. The grant funds are used to provide housing rehabilitation loans to qualified
homeowners and to provide support for community service organizations.
Senior Nutrition
This fund is used to account for grant monies received from the County of Los Angeles for the aging program and
other related activities.
Public Benefit Program
This fund is used to account for monies related to the City's electric utility that are restricted for benefit programs.
Air Quality Improvement
This fund is used to account for monies received from the State and other sources that are restricted for air quality
management activities.
Supplemental Law Enforcement
This fund is used to account for monies received as part of the State Supplemental Law Enforcement program that are
restricted for public safety purposes.
Monrovia Nursery
This fund is used to account for activities of the Monrovia Nursery.
Employee Benefits
This fund is used to account for monies that have been committed by City Council to be set aside to provide funding
for employee benefits.
Utility Mitigation
This fund is used to account for federal monies collected for utility mitigation activities.
122
NON-MAJOR GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS, Continued:
Highway 39
This fund is used to account for monies collected for Highway 39.
LACMTA
To account for activities related to the Los Angeles County Metro Transportation Authority.
Measure R
This fund is used to account for restricted Measure R monies and related expenditures.
AB939 Fee
This fund is used to account for restricted AB939 monies and related expenditures.
Rosedale Traffic Mitigation
To account for traffic mitigation fees related to the Rosedale district area.
RMR SB1
This fund is used to account for restricted State SB1 monies and related expenditures.
Measure M
This fund is used to account for restricted Los Angeles County Measure M monies and related expenditures.
CAPITAL PROJECT FUNDS:
Capital project funds are used to account for the acquisition, construction and improvements to major capital facilities
Park In-Lieu
To account for park in lieu fees and related capital project expenditures.
Capital Projects
To account for capital project expenditures.
Public Works Endowment
To account for capital project expenditures funded by donations and other monies restricted for public works projects.
DEBT SERVICE FUNDS
Debt service funds are used to account for the accumulation of resources for, and the payment of, general long-term
debt principal, interest and related costs.
Public Financing Authority
To account for debt service expenditures of debt issued by the City of Azusa Public Financing Authority.
123
City of Azusa
Combining Balance Sheet
Non-Major Governmental Funds
June 30, 2020
Community
Grant and State Development
Seizure Fund Gasoline Tax Proposition A Proposition C Block Grant
ASSETS
Pooled cash and investments 2,303,371$ 122,984$ 2,495,515$ 2,483,003$ -$
Receivables:
Accounts 2,655,258 565 11,319 16 888,285
Taxes - - - - -
Notes and loans - - - - 57,237
Accrued interest - - 3,239 3,352 -
Prepaid costs 3,666 - - 3,000 -
Restricted assets:
Cash and investments with fiscal agents - - - - -
Total assets 4,962,295$ 123,549$ 2,510,073$ 2,489,371$ 945,522$
LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCES
LIABILITIES
Accounts payable 1,012,016$ 81,144$ 12,919$ 14,907$ 36,944$
Accrued liabilities 3,328 41,880 33,184 20,404 5,119
Unearned revenues 1,986,058 - - - -
Deposits payable - - - - -
Due to other funds - - - - 462,877
Total liabilities 3,001,402 123,024 46,103 35,311 504,940
DEFERRED INFLOW OF RESOURCES
Unavailable revenues 1,061,537 - 11,277 - 447,113
Total deferred inflow of resources 1,061,537 - 11,277 - 447,113
FUND BALANCES
Nonspendable:
Prepaid costs 3,666 - - 3,000 -
Restricted for:
Community development projects 708,567 - 2,452,693 2,451,060 -
Public safety 187,123 - - - -
Capital projects - 525 - - -
Debt service - - - - -
Committed for:
Employee benefits - - - -
Unassigned - - - - (6,531)
Total fund balances 899,356 525 2,452,693 2,454,060 (6,531)
Total liabilities, deferred inflows
of resources, and fund balances 4,962,295$ 123,549$ 2,510,073$ 2,489,371$ 945,522$
Special Revenue Funds
124
Supplemental
Senior Public Benefit Air Quality Law Monrovia Employee Utility
Nutrition Program Improvement Enforcement Nursery Benefits Mitigation Highway 39
70,451$ 1,211,378$ 241,492$ 582,694$ 363,554$ 539,228$ 2,957,603$ 1,610,351$
79,128 60,444 134 - - 1,395 - -
- - - - 17,355 - - -
- 226 - - - - - -
- 1,590 317 817 456 - - 2,195
- - - - - - - -
- - - - - - - -
149,579$ 1,273,638$ 241,943$ 583,511$ 381,365$ 540,623$ 2,957,603$ 1,612,546$
29,495$ 106,508$ 644$ -$ 67,465$ 8,022$ -$ -$
5,959 11,696 30 - 16,265 - - -
- - - 516,971 - - - -
- - - - 16,207 - - -
- - - - 40,000 - - -
35,454 118,204 674 516,971 139,937 8,022 - -
- - - - - - - -
- - - - - - - -
- - - - - - - -
114,125 1,155,434 - - - - - 1,612,546
- - - 66,540 - - - -
- - 241,269 - 241,428 - 2,957,603 -
- - - - - - - -
- - - - - 532,601 - -
- - - - - - - -
114,125 1,155,434 241,269 66,540 241,428 532,601 2,957,603 1,612,546
149,579$ 1,273,638$ 241,943$ 583,511$ 381,365$ 540,623$ 2,957,603$ 1,612,546$
Special Revenue Funds
125
City of Azusa
Combining Balance Sheet
Non-Major Governmental Funds
June 30, 2020
Rosedale
Traffic
LACMTA Measure R AB939 Fee Mitigation RMR SB1
ASSETS
Pooled cash and investments -$ -$ 326,654$ 533,499$ 1,485,788$
Receivables:
Accounts 8,042 9,891 9,268 - 135,715
Taxes - - - - -
Notes and loans - - - - -
Accrued interest - - - 726 1,868
Prepaid costs - - - - -
Restricted assets:
Cash and investments with fiscal agents - 2,494,277 - - -
Total assets 8,042$ 2,504,168$ 335,922$ 534,225$ 1,623,371$
LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCES
LIABILITIES
Accounts payable -$ 659,029$ 2,286$ -$ 1$
Accrued liabilities - 5,562 7,201 - 3
Unearned revenues - - - - -
Deposits payable - - - - -
Due to other funds 103,376 712,511 - - -
Total liabilities 103,376 1,377,102 9,487 - 4
DEFERRED INFLOW OF RESOURCES
Unavailable revenues - - - - -
Total deferred inflow of resources - - - - -
FUND BALANCES
Nonspendable
Prepaid costs - - - - -
Restricted for
Community development projects - - - - -
Public safety - - - - -
Capital projects - 1,127,066 326,435 534,225 1,623,367
Debt service - - - - -
Committed for:
Employee benefits - - - - -
Unassigned (95,334) - - - -
Total fund balances (95,334) 1,127,066 326,435 534,225 1,623,367
Total liabilities, deferred inflows
of resources, and fund balances 8,042$ 2,504,168$ 335,922$ 534,225$ 1,623,371$
Special Revenue Funds
126
Special
Revenue Debt Service
Funds Funds
Public Total Nonmajor
Capital Public Works Financing Governmental
Measure M Park in-lieu Projects Endowment Authority Funds
1,682,637$ 145,647$ -$ 90,935$ 22,204$ 19,268,988$
- - - - - 3,859,460
- - - - - 17,355
- - - - - 57,463
2,105 196 - 124 - 16,985
- - - - - 6,666
- - - - 513,111 3,007,388
1,684,742$ 145,843$ -$ 91,059$ 535,315$ 26,234,305$
47,213$ -$ -$ 4,001$ -$ 2,082,594$
729 - - - - 151,360
- - - - - 2,503,029
- - - - - 16,207
- - 541 - - 1,319,305
47,942 - 541 4,001 - 6,072,495
- - - - - 1,519,927
- - - - - 1,519,927
- - - - - 6,666
- - - - - 8,494,425
- - - 87,058 - 340,721
1,636,800 145,843 - - - 8,834,561
- - - - 535,315 535,315
- - - - - 532,601
- - (541) - - (102,406)
1,636,800 145,843 (541) 87,058 535,315 18,641,883
1,684,742$ 145,843$ -$ 91,059$ 535,315$ 26,234,305$
Capital Projects Funds
127
City of Azusa
Combined Statement of Revenues, Expenditures and Changes in Fund Balances
Non-Major Governmental Funds
For the year ended June 30, 2020
Community
Grant and State Development
Seizure Fund Gasoline Tax Proposition A Proposition C Block Grant
REVENUES:
Taxes 34,774$ -$ 963,348$ 799,099$ -$
Licenses and permits - - - - -
Intergovernmental 2,487,713 1,166,855 167,198 83,280 335,332
Charges for services 7,204 - 13,186 11,535 -
Use of money and property 26,019 - 39,544 40,898 -
Contributions 283 - - - -
Miscellaneous 13,321 (132) (151) (72) -
Total revenues 2,569,314 1,166,723 1,183,125 934,740 335,332
EXPENDITURES:
Current:
General government 63,816 - - - -
Public safety 330,599 - - - -
Community development 130,408 - - - 326,531
Parks and recreation 13,000 58,758 - - -
Public works 4,371 1,114,909 915,034 666,825 -
Capital outlay 3,061,526 - 34,551 17,121 -
Debt service:
Principal repayment - - - - -
Interest and fiscal charges - - - - -
Total expenditures 3,603,720 1,173,667 949,585 683,946 326,531
REVENUE OVER
(UNDER) EXPENDITURES (1,034,406) (6,944) 233,540 250,794 8,801
OTHER FINANCING
SOURCES (USES):
Transfers in - - - - -
Transfers out - - - - -
Total other financing sources (uses)- - - - -
Net change in fund balances (1,034,406) (6,944) 233,540 250,794 8,801
FUND BALANCES:
Beginning of year, as restated 1,933,762 7,469 2,219,153 2,203,266 (15,332)
End of year 899,356$ 525$ 2,452,693$ 2,454,060$ (6,531)$
Special Revenue Funds
128
Supplemental
Senior Public Benefit Air Quality Law Monrovia Employee Utility
Nutrition Program Improvement Enforcement Nursery Benefits Mitigation Highway 39
-$ -$ -$ -$ -$ -$ -$ -$
- - - - - - - -
199,272 - 48,879 171,520 - - - -
- 1,001,558 1,313 - 711,310 - - -
- 20,346 3,772 10,430 4,341 - - 28,090
75,521 - - - - - - -
- - - - - - - -
274,793 1,021,904 53,964 181,950 715,651 - - 28,090
- 266,998 - - 40,000 852,321 - -
- - - 92,045 - - - -
- 768,847 - - - - - -
453,100 - - - 6,344 - - -
- - 12,293 - 408,536 - - -
- - 15,863 79,475 - - - -
- - - - - - - -
- - - - - - - -
453,100 1,035,845 28,156 171,520 454,880 852,321 - -
(178,307) (13,941) 25,808 10,430 260,771 (852,321) - 28,090
162,639 - - - - 952,800 1,249,741 -
- - - - (348,700) - - -
162,639 - - - (348,700) 952,800 1,249,741 -
(15,668) (13,941) 25,808 10,430 (87,929) 100,479 1,249,741 28,090
129,793 1,169,375 215,461 56,110 329,357 432,122 1,707,862 1,584,456
114,125$ 1,155,434$ 241,269$ 66,540$ 241,428$ 532,601$ 2,957,603$ 1,612,546$
Special Revenue Funds
129
City of Azusa
Combined Statement of Revenues, Expenditures and Changes in Fund Balances
Non-Major Governmental Funds
For the year ended June 30, 2020
Rosedale
Traffic
LACMTA Measure R AB939 Fee Mitigation RMR SB1
REVENUES:
Taxes -$ 598,467$ -$ -$ -$
Licenses and permits - - - - -
Intergovernmental - 56,374 - - 888,735
Charges for services - - - - -
Use of money and property - 39,425 211,730 9,300 17,444
Contributions - - - - -
Miscellaneous - - - - -
Total revenues - 694,266 211,730 9,300 906,179
EXPENDITURES:
Current:
General government - - - - -
Public safety - - - - -
Community development - - - - -
Parks and recreation - - - - -
Public works - 447,491 210,712 - 62
Capital outlay - 1,567,496 - - -
Debt service:
Principal repayment - 110,000 - - -
Interest and fiscal charges - 122,119 - - -
Total expenditures - 2,247,106 210,712 - 62
REVENUE OVER
(UNDER) EXPENDITURES - (1,552,840) 1,018 9,300 906,117
OTHER FINANCING
SOURCES (USES):
Transfers in - - - - -
Transfers out - - - - -
Total other financing sources (uses)- - - - -
Net change in fund balances - (1,552,840) 1,018 9,300 906,117
FUND BALANCES:
Beginning of year, as restated (95,334) 2,679,906 325,417 524,925 717,250
End of year (95,334)$ 1,127,066$ 326,435$ 534,225$ 1,623,367$
Special Revenue Funds
130
Special
Revenue Debt Service
Funds Funds
Public Total Nonmajor
Capital Public Works Financing Governmental
Measure M Park in-lieu Projects Endowment Authority Funds
674,100$ -$ -$ -$ -$ 3,069,788$
- 44,850 - - - 44,850
- - - - - 5,605,158
- - - - - 1,746,106
22,463 2,277 - 1,589 7,292 484,960
- - - - - 75,804
- - - - - 12,966
696,563 47,127 - 1,589 7,292 11,039,632
- - - - - 1,223,135
- - - - - 422,644
- - - - - 1,225,786
- - - - - 531,202
971 - - - - 3,781,204
81,140 - - - - 4,857,172
- - - - 315,000 425,000
- - - - 48,668 170,787
82,111 - - - 363,668 12,636,930
614,452 47,127 - 1,589 (356,376) (1,597,298)
- - - - 363,696 2,728,876
- - - - - (348,700)
- - - - 363,696 2,380,176
614,452 47,127 - 1,589 7,320 782,878
1,022,348 98,716 (541) 85,469 527,995 17,859,005
1,636,800$ 145,843$ (541)$ 87,058$ 535,315$ 18,641,883$
Capital Projects Funds
131
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Grants and Seizure
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1, as restated 1,933,762$ 1,933,762$ 1,933,762$ -$
Resources (Inflows):
Taxes - - 34,774 34,774
Intergovernmental 233,954 761,677 2,487,713 1,726,036
Charges for services - - 7,204 7,204
Use of money and property - - 26,019 26,019
Contributions - - 283 283
Miscellaneous - - 13,321 13,321
Transfers in - - - -
Amounts available for appropriations 2,167,716 2,695,439 4,503,076 1,807,637
Charges to Appropriations (Outflows):
General government - 172,515 63,816 108,699
Public Safety 176,418 475,818 330,599 145,219
Community development 26,147 168,912 130,408 38,504
Public works - 1,100 4,371 (3,271)
Capital outlay 76,400 4,473,018 3,061,526 1,411,492
Transfers out - - - -
Total charges to appropriations 278,965 5,336,363 3,603,720 1,732,643
Budgetary fund balance, June 30 1,888,751$ (2,640,924)$ 899,356$ 3,540,280$
Budget Amounts
132
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
State Gasoline Tax
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 7,469$ 7,469$ 7,469$ -$
Resources (Inflows):
Intergovernmental 1,243,767 1,243,767 1,166,855 (76,912)
Miscellaneous - - (132) (132)
Transfers in - - - -
Amounts available for appropriations 1,251,236 1,251,236 1,174,192 (77,044)
Charges to Appropriations (Outflows):
Parks and recreation 59,000 59,000 58,758 242
Public works 1,553,655 1,553,655 1,114,909 438,746
Capital outlay 6,375 6,375 - 6,375
Total charges to appropriations 1,619,030 1,619,030 1,173,667 445,363
Budgetary fund balance, June 30 (367,794)$ (367,794)$ 525$ 368,319$
Budget Amounts
133
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Proposition A
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1, as restated 2,219,153$ 2,219,153$ 2,219,153$ -$
Resources (Inflows):
Taxes 1,005,269 1,005,269 963,348 (41,921)
Intergovernmental 168,533 168,533 167,198 (1,335)
Charges for services 17,522 17,522 13,186 (4,336)
Use of money and property - - 39,544 39,544
Miscellaneous - - (151) (151)
Amounts available for appropriations 3,410,477 3,410,477 3,402,278 (8,199)
Charges to Appropriations (Outflows):
Public works 1,086,506 1,114,006 915,034 198,972
Capital outlay 800,000 844,612 34,551 810,061
Total charges to appropriations 1,886,506 1,958,618 949,585 1,009,033
Budgetary fund balance, June 30 1,523,971$ 1,451,859$ 2,452,693$ 1,000,834$
Budget Amounts
134
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Proposition C
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1, as restated 2,203,266$ 2,203,266$ 2,203,266$ -$
Resources (Inflows):
Taxes 833,845 833,845 799,099 (34,746)
Intergovernmental 72,414 72,414 83,280 10,866
Charges for services 17,585 17,585 11,535 (6,050)
Use of money and property - - 40,898 40,898
Miscellaneous - - (72) (72)
Amounts available for appropriations 3,127,110 3,127,110 3,138,006 10,896
Charges to Appropriations (Outflows):
Public works 687,599 803,599 666,825 136,774
Capital outlay 410,000 943,570 17,121 926,449
Total charges to appropriations 1,097,599 1,747,169 683,946 1,063,223
Budgetary fund balance, June 30 2,029,511$ 1,379,941$ 2,454,060$ 1,074,119$
Budget Amounts
135
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Community Development Block Grant
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 (15,332)$ (15,332)$ (15,332)$ -$
Resources (Inflows):
Intergovernmental 547,863 547,863 335,332 (212,531)
Miscellaneous - - - -
Amounts available for appropriations 532,531 532,531 320,000 (212,531)
Charges to Appropriations (Outflows):
Community development 442,930 442,930 326,531 116,399
Total charges to appropriations 442,930 442,930 326,531 116,399
Budgetary fund balance, June 30 89,601$ 89,601$ (6,531)$ (96,132)$
Budget Amounts
136
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Senior Nutrition
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 129,793$ 129,793$ 129,793$ -$
Resources (Inflows):
Intergovernmental 117,774 117,774 199,272 81,498
Contributions 75,242 75,242 75,521 279
Miscellaneous - - - -
Transfers in 162,639 162,639 162,639 -
Amounts available for appropriations 485,448 485,448 567,225 81,777
Charges to Appropriations (Outflows):
Parks and recreation 355,655 385,655 453,100 (67,445)
Total charges to appropriations 355,655 385,655 453,100 (67,445)
Budgetary fund balance, June 30 129,793$ 99,793$ 114,125$ 14,332$
Budget Amounts
137
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Public Benefit Program
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 1,169,375$ 1,169,375$ 1,169,375$ -$
Resources (Inflows):
Charges for services 1,054,810 1,054,810 1,001,558 (53,252)
Use of money and property 10,000 10,000 20,346 10,346
Miscellaneous - - - -
Amounts available for appropriations 2,234,185 2,234,185 2,191,279 (42,906)
Charges to Appropriations (Outflows):
General government 349,125 349,125 266,998 82,127
Community development 1,035,500 1,035,500 768,847 266,653
Capital outlay 100,000 100,000 - 100,000
Total charges to appropriations 1,484,625 1,484,625 1,035,845 448,780
Budgetary fund balance, June 30 749,560$ 749,560$ 1,155,434$ 405,874$
Budget Amounts
138
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Air Quality Improvement
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 215,461$ 215,461$ 215,461$ -$
Resources (Inflows):
Intergovernmental 64,100 64,100 48,879 (15,221)
Charges for services 6,500 6,500 1,313 (5,187)
Use of money and property 1,000 1,000 3,772 2,772
Amounts available for appropriations 287,061 287,061 269,425 (17,636)
Charges to Appropriations (Outflows):
Public works 49,350 49,350 12,293 37,057
Capital outlay - 21,160 15,863 5,297
Total charges to appropriations 49,350 70,510 28,156 42,354
Budgetary fund balance, June 30 237,711$ 216,551$ 241,269$ 24,718$
Budget Amounts
139
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Supplemental Law Enforcement
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 56,110$ 56,110$ 56,110$ -$
Resources (Inflows):
Intergovernmental 37,300 37,300 171,520 134,220
Use of money and property 3,000 3,000 10,430 7,430
Amounts available for appropriations 96,410 96,410 238,060 141,650
Charges to Appropriations (Outflows):
Public Safety 17,300 99,330 92,045 7,285
Capital outlay 84,975 84,975 79,475 5,500
Total charges to appropriations 102,275 184,305 171,520 12,785
Budgetary fund balance, June 30 (5,865)$ (87,895)$ 66,540$ 154,435$
Budget Amounts
140
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Monrovia Nursery
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 329,357$ 329,357$ 329,357$ -$
Resources (Inflows):
Charges for services 606,000 714,398 711,310 (3,088)
Use of money and property 2,500 2,500 4,341 1,841
Miscellaneous - - - -
Amounts available for appropriations 937,857 1,046,255 1,045,008 (1,247)
Charges to Appropriations (Outflows):
General government 40,000 40,000 40,000 -
Parks and recreation 2,330 2,330 6,344 (4,014)
Public works 370,876 370,876 408,536 (37,660)
Transfers out 348,700 348,700 348,700 -
Total charges to appropriations 761,906 761,906 803,580 (41,674)
Budgetary fund balance, June 30 175,951$ 284,349$ 241,428$ (42,921)$
Budget Amounts
141
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Employee Benefits
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 432,122$ 432,122$ 432,122$ -$
Resources (Inflows):
Transfers in 952,800 952,800 952,800 -
Amounts available for appropriations 1,384,922 1,384,922 1,384,922 -
Charges to Appropriations (Outflows):
General government 952,800 952,800 852,321 100,479
Total charges to appropriations 952,800 952,800 852,321 100,479
Budgetary fund balance, June 30 432,122$ 432,122$ 532,601$ 100,479$
Budget Amounts
142
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Utility Mitigation
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 1,707,862$ 1,707,862$ 1,707,862$ -$
Resources (Inflows):
Transfers in 375,000 375,000 1,249,742 874,742
Amounts available for appropriations 2,082,862 2,082,862 2,957,604 874,742
Charges to Appropriations (Outflows):
Public works 50,000 50,000 - 50,000
Capital outlay 50,000 50,000 - 50,000
Total charges to appropriations 100,000 100,000 - 100,000
Budgetary fund balance, June 30 1,982,862$ 1,982,862$ 2,957,604$ 974,742$
Budget Amounts
143
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Highway 39
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 1,584,456$ 1,584,456$ 1,584,456$ -$
Resources (Inflows):
Use of money and property 15,000 15,000 28,090 13,090
Amounts available for appropriations 1,599,456 1,599,456 1,612,546 13,090
Charges to Appropriations (Outflows):
Public works - - - -
Total charges to appropriations - - - -
Budgetary fund balance, June 30 1,599,456$ 1,599,456$ 1,612,546$ 13,090$
Budget Amounts
144
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
LACMTA
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 (95,334)$ (95,334)$ (95,334)$ -$
Resources (Inflows):
Intergovernmental - - - -
Use of money and property - - - -
Amounts available for appropriations (95,334) (95,334) (95,334) -
Charges to Appropriations (Outflows):
Capital outlay - - - -
Total charges to appropriations - - - -
Budgetary fund balance, June 30 (95,334)$ (95,334)$ (95,334)$ -$
Budget Amounts
145
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Measure R
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1, as restated 2,679,906$ 2,679,906$ 2,679,906$ -$
Resources (Inflows):
Taxes 625,451 625,451 598,467 (26,984)
Intergovernmental - - 56,374 56,374
Use of money and property 40,000 40,000 39,425 (575)
Amounts available for appropriations 3,345,357 3,345,357 3,374,172 28,815
Charges to Appropriations (Outflows):
Public works 139,560 154,415 447,491 (293,076)
Capital outlay - 1,939,337 1,567,496 371,841
Debt service:
Principal retirement - - 110,000 (110,000)
Interest and fiscal charges - - 122,119 (122,119)
Total charges to appropriations 139,560 2,093,752 2,247,106 (153,354)
Budgetary fund balance, June 30 3,205,797$ 1,251,605$ 1,127,066$ (124,539)$
Budget Amounts
146
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
AB939 Fee
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 325,417$ 325,417$ 325,417$ -$
Resources (Inflows):
Use of money and property 225,193 225,193 211,730 (13,463)
Miscellaneous - - - -
Amounts available for appropriations 550,610 550,610 537,147 (13,463)
Charges to Appropriations (Outflows):
Public works 288,290 288,290 210,712 77,578
Total charges to appropriations 288,290 288,290 210,712 77,578
Budgetary fund balance, June 30 262,320$ 262,320$ 326,435$ 64,115$
Budget Amounts
147
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Rosedale Traffic Mitigation
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 524,925$ 524,925$ 524,925$ -$
Resources (Inflows):
Use of money and property - - 9,300 9,300
Amounts available for appropriations 524,925 524,925 534,225 9,300
Charges to Appropriations (Outflows):
Public works - - - -
Total charges to appropriations - - - -
Budgetary fund balance, June 30 524,925$ 524,925$ 534,225$ 9,300$
Budget Amounts
148
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
RMR SB1
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 717,250$ 717,250$ 717,250$ -$
Resources (Inflows):
Intergovernmental 883,153 883,153 888,735 5,582
Use of money and property - - 17,444 17,444
Amounts available for appropriations 1,600,403 1,600,403 1,623,429 23,026
Charges to Appropriations (Outflows):
Public works - - 62 (62)
Capital outlay 820,000 820,000 - 820,000
Total charges to appropriations 820,000 820,000 62 819,938
Budgetary fund balance, June 30 780,403$ 780,403$ 1,623,367$ 842,964$
Budget Amounts
149
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Measure M
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 1,022,348$ 1,022,348$ 1,022,348$ -$
Resources (Inflows):
Taxes 708,768 708,768 674,100 (34,668)
Use of money and property - - 22,463 22,463
Amounts available for appropriations 1,731,116 1,731,116 1,718,911 (12,205)
Charges to Appropriations (Outflows):
Public works 73,240 73,240 971 72,269
Capital outlay - 93,440 81,140 12,300
Total charges to appropriations 73,240 166,680 82,111 84,569
Budgetary fund balance, June 30 1,657,876$ 1,564,436$ 1,636,800$ 72,364$
Budget Amounts
150
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Park In-lieu
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 98,716$ 98,716$ 98,716$ -$
Resources (Inflows):
Licenses and permits 25,000 25,000 44,850 19,850
Use of money and property - - 2,277 2,277
Amounts available for appropriations 123,716 123,716 145,843 22,127
Charges to Appropriations (Outflows):
Capital outlay 30,000 30,000 - 30,000
Total charges to appropriations 30,000 30,000 - 30,000
Budgetary fund balance, June 30 93,716$ 93,716$ 145,843$ 52,127$
Budget Amounts
151
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Capital Projects
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 (541)$ (541)$ (541)$ -$
Resources (Inflows):
Transfers in - - - -
Amounts available for appropriations (541) (541) (541) -
Charges to Appropriations (Outflows):
Capital outlay - - - -
Total charges to appropriations - - - -
Budgetary fund balance, June 30 (541)$ (541)$ (541)$ -$
Budget Amounts
152
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Public Works Endowment
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 85,469$ 85,469$ 85,469$ -$
Resources (Inflows):
Use of money and property - - 1,589 1,589
Amounts available for appropriations 85,469 85,469 87,058 1,589
Charges to Appropriations (Outflows):
Capital outlay - 75,000 - 75,000
Total charges to appropriations - 75,000 - 75,000
Budgetary fund balance, June 30 85,469$ 10,469$ 87,058$ 76,589$
Budget Amounts
153
City of Azusa
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
Public Financing Authority
For the year ended June 30, 2020
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Budgetary Fund Balance, July 1 527,995$ 527,995$ 527,995$ -$
Resources (Inflows):
Use of money and property - - 7,292 7,292
Transfers in 363,696 363,696 363,696 -
Amounts available for appropriations 891,691 891,691 898,983 7,292
Charges to Appropriations (Outflows):
Debt service:
Principal retirement 315,000 315,000 315,000 -
Interest and fiscal charges 48,696 48,696 48,668 28
Total charges to appropriations 363,696 363,696 363,668 28
Budgetary fund balance, June 30 527,995$ 527,995$ 535,315$ 7,320$
Budget Amounts
154
NON-MAJOR ENTERPRISE FUND FINANCIAL STATEMENTS
Sewer/Wastewater Fund
To account for the costs of labor and material used in the maintenance, construction, and consumption of
sewer services.
Refuse Fund
To account for the costs of labor and materials used in the maintenance, construction, and consumption of
refuse services throughout the City.
155
City of Azusa
Combining Statement of Net Position
Non-Major Enterprise Funds
June 30, 2020
Total
Sewer/ Refuse Non-major
Wastewater Contract Enterprise
Fund Fund Funds
ASSETS
Current:
Cash and investments 6,429,591$ 338,517$ 6,768,108$
Receivables:
Accounts 406,382 587,409 993,791
Accrued interest 8,416 - 8,416
Prepaid costs 756 - 756
Restricted cash with fiscal agent 1,375,513 - 1,375,513
Total current assets 8,220,658 925,926 9,146,584
Noncurrent:
Capital assets - net of accumulated depreciation 8,451,256 - 8,451,256
Total noncurrent assets 8,451,256 - 8,451,256
Total assets 16,671,914 925,926 17,597,840
DEFERRED OUTFLOWS OF RESOURCES
Deferred pension related items 258,334 - 258,334
Total deferred outflows of resources 258,334 - 258,334
LIABILITIES
Current:
Accounts payable 69,926$ 649,999$ 719,925
Accrued liabilities 32,443 - 32,443
Deposits payable 53 - 53
Compensated absences - due within one year 89,529 - 89,529
Bonds and notes payable - due within one year 425,000 - 425,000
Total current liabilities 616,951 649,999 1,266,950
Noncurrent:
Bonds and note payable - due in more than one year 2,365,000 - 2,365,000
Net pension liability 1,756,623 - 1,756,623
Total noncurent liabilities 4,121,623 - 4,121,623
Total liabilities 4,738,574 649,999 5,388,573
DEFERRED INFLOWS OF RESOURCES
Deferred pension related items 40,286 - 40,286
Total deferred inflows of resources 40,286 - 40,286
NET POSITION
Net investment in capital assets 5,661,256 - 5,661,256
Restricted for debt service 1,375,513 - 1,375,513
Unrestricted 5,114,619 275,927 5,390,546
Total net position 12,151,388$ 275,927$ 12,427,315$
Business-Type Activities - Enterprise Funds
156
City of Azusa
Combining Statement of Revenues, Expenses, and Changes in Fund Net Position
Non-Major Enterprise Funds
For the year ended June 30, 2020
Total
Sewer/ Refuse Non-major
Wastewater Contract Enterprise
Fund Fund Funds
OPERATING REVENUES:
Sales and service charges 3,292,950$ 4,119,397$ 7,412,347
Miscellaneous 1 - 1
Total operating revenues 3,292,951 4,119,397 7,412,348
OPERATING EXPENSES:
Administration and general 1,196,618 - 1,196,618
Treatment 782,523 - 782,523
Refuse collection - 3,977,345 3,977,345
Depreciation expense 489,347 - 489,347
Total operating expenses 2,468,488 3,977,345 6,445,833
OPERATING INCOME (LOSS)824,463 142,052 966,515
NONOPERATING REVENUES (EXPENSES):
Taxes - 763,180 763,180
Interest revenue 122,016 - 122,016
Interest expense (59,523) - (59,523)
Special franchise fees (66,229) - (66,229)
Total nonoperating revenues (expenses)(3,736) 763,180 759,444
INCOME (LOSS) BEFORE TRANSFERS 820,727 905,232 1,725,959
Transfer out (61,000) (872,420) (933,420)
Change in net position 759,727 32,812 792,539
Net position:
Beginning of year 11,391,661 243,115 11,634,776
End of year 12,151,388$ 275,927$ 12,427,315$
Business-Type Activities - Enterprise Funds
157
City of Azusa
Combining Statement of Cash Flows
Non-Major Enterprise Funds
For the year ended June 30, 2020
Total
Sewer/ Refuse Non-major
Wastewater Contract Proprietary
Fund Fund Funds
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers and users 3,278,946$ 4,105,146$ 7,384,092$
Cash paid to suppliers for goods and services (1,152,780) (3,941,475) (5,094,255)
Cash paid to employees for services (631,746) - (631,746)
Net cash provided by (used in) operating activities 1,494,420 163,671 1,658,091
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Cash transfers out (61,000) (872,420) (933,420)
Net cash provided by noncapital financing activities (61,000) (872,420) (933,420)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING
ACTIVITIES:
Principal paid on capital debt (415,000) - (415,000)
Interest paid on capital debt (59,523) - (59,523)
Special franchise fees paid (66,229) - (66,229)
Taxes - 763,180 763,180
Net cash provided by (used in) capital and related financing
activities (540,752) 763,180 222,428
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest received 139,815 - 139,815
Net cash provided by (used in) investing activities 139,815 - 139,815
Net increase (decrease) in cash and cash equivalents 1,032,483 54,431 1,086,914
CASH AND CASH EQUIVALENTS:
Beginning of year 6,772,621 284,086 7,056,707
End of year 7,805,104$ 338,517$ 8,143,621$
FINANCIAL STATEMENT PRESENTATION:
Cash and investments 6,429,591$ 338,517$ 6,768,108$
Cash with fiscal agent 1,375,513 - 1,375,513
Total 7,805,104$ 338,517$ 8,143,621$
RECONCILIATION OF OPERATING INCOME TO NET
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:
Operating income (loss)824,463$ 142,052$ 966,515$
Adjustments to reconcile operating income (loss) to net
cash provided by (used in) operating activities:
Depreciation 489,347 - 489,347
Changes in current assets and liabilities:
(Increase) decrease in accounts receivable (14,058) (14,251) (28,309)
(Increase) decrease in prepaid expense (246) - (246)
(Increase) decrease in deferred pension related outflows 36,676 - 36,676
Increase (decrease) in accounts payable (23,935) 35,870 11,935
Increase (decrease) in accrued liabilities (4,614) - (4,614)
Increase (decrease) in compensated absences 37,802 - 37,802
Increase (decrease) in net pension liability 149,999 - 149,999
Increase (decrease) in deferred pension related inflows (1,067) - (1,067)
Total adjustments 669,957 21,619 691,576
Net cash provided by (used in) by operating activities 1,494,420$ 163,671$ 1,658,091$
Business-Type Activities - Enterprise Funds
158
INTERNAL SERVICE FUNDS
Internal Service Funds are used to finance and account for special activities and services performed by a
designated department for other departments in the City on a cost reimbursement basis.
Consumer Services
To account for activities providing support to the City's enterprise activities.
Self-Insurance
To account for claim and risk management activities.
Central Services
To account for other activities that are provided to support all departments.
Equipment Replacement
To account for the rental of equipment to all City departments and for the accumulation of funds and
disbursements for equipment acquisitions. User charges include an amount necessary for the maintenance
and replacement of equipment.
IT Services
To account for the costs related to providing IT services to all City departments.
159
City of Azusa
Combining Statement of Net Position
Internal Service Funds
June 30, 2020
Consumer Central
Services Self-Insurance Services
ASSETS AND DEFERRED OUTFLOWS
OF RESOURCES
ASSETS
Current:
Cash and investments -$ -$ 3,309$
Receivables:
Accounts 695,273 294,792 96
Notes and loans 139 - -
Accrued interest 64,711 - -
Prepaid costs - 812,170 -
Total current assets 760,123 1,106,962 3,405
Noncurrent:
Capital assets - net of accumulated depreciation 1,027,995 - 23,711
Total noncurrent assets 1,027,995 - 23,711
Total assets 1,788,118 1,106,962 27,116
DEFERRED OUTFLOWS OF RESOURCES
Deferred OPEB related items 299,434 - -
Deferred pension related items 858,444 21,562 -
Total deferred outflows of resources 1,157,878 21,562 -
LIABILITIES
Current:
Accounts payable 119,357 367,046 561
Accrued liabilities 165,940 5,376 -
Due to other funds 521,020 1,883,084 -
Accrued compensated absences - due within one year 250,741 2,740 -
Accrued claims and judgements - due within one year - 3,207,959 -
Total current liabilities 1,057,058 5,466,205 561
Noncurrent:
Accrued compensated absences - due in more than one year 41,699 - -
Accrued claims and judgements - due in more than one year - 1,787,382 -
Total OPEB liability 1,275,742 - -
Net pension liability 5,652,132 147,801 -
Total noncurent liabilities 6,969,573 1,935,183 -
Total liabilities 8,026,631 7,401,388 561
DEFERRED INFLOWS OF RESOURCES
Deferred pension related items 124,916 3,420 -
Total deferred inflows of resources 124,916 3,420 -
NET POSITION
Net investment in capital assets 1,027,995 - 23,711
Unrestricted (6,233,546) (6,276,284) 2,844
Total net position (5,205,551)$ (6,276,284)$ 26,555$
160
Equipment
Replacement IT Services Totals
-$ 220,115$ 223,424$
- - 990,161
- - 139
- - 64,711
46,154 121,979 980,303
46,154 342,094 2,258,738
527,250 - 1,578,956
527,250 - 1,578,956
573,404 342,094 3,837,694
- - 299,434
- 417,684 1,297,690
- 417,684 1,597,124
119,419 104,197 710,580
- 46,535 217,851
759,292 - 3,163,396
- 95,493 348,974
- - 3,207,959
878,711 246,225 7,648,760
- 91,540 133,239
- - 1,787,382
- - 1,275,742
- 2,798,748 8,598,681
- 2,890,288 11,795,044
878,711 3,136,513 19,443,804
- 63,132 191,468
- 63,132 191,468
527,250 - 1,578,956
(832,557) (2,439,867) (15,779,410)
(305,307)$ (2,439,867)$ (14,200,454)$
161
City of Azusa
Combining Statement of Revenues, Expenses, and Changes in Fund Net Position
Internal Service Funds
For the year ended June 30, 2020
Consumer Central
Services Self-Insurance Services
OPERATING REVENUES:
Sales and service charges 5,531,592$ 3,005,047$ -$
Interdepartmental charges - - -
Miscellaneous - 257,937 -
Lease revenue - - -
Total operating revenues 5,531,592 3,262,984 -
OPERATING EXPENSES:
Administration and general 5,548,867 2,520,429 -
Source of supply 429,507 - -
Pumping - - -
Transmission/collection - - -
Treatment - - -
Refuse collection - - -
Cost of sales and services - - -
Claims expense 624,231 3,157,866 -
Depreciation expense 46,021 - 1,492
Total operating expenses 6,648,626 5,678,295 1,492
OPERATING INCOME (LOSS)(1,117,034) (2,415,311) (1,492)
NONOPERATING REVENUES (EXPENSES):
Interest revenue - - -
Interest expense - - -
Intergovernmental - - -
Special franchise fees - - -
Loss on disposal of capital assets - - -
Gain on disposal of capital assets 2,183 - -
Total nonoperating revenues (expenses)2,183 - -
INCOME (LOSS) BEFORE TRANSFERS (1,114,851) (2,415,311) (1,492)
Transfer in 132,335 - -
Transfer out (482,237) - -
Change in net position (1,464,753) (2,415,311) (1,492)
Net position:
Beginning of year (3,740,798) (3,860,973) 28,047
End of year (5,205,551)$ (6,276,284)$ 26,555$
162
Equipment
Replacement IT Services Totals
-$ 1,733,670$ 10,270,309$
- - -
- - 257,937
- - -
- 1,733,670 10,528,246
4,164 2,003,390 10,076,850
- - 429,507
- - -
- - -
- - -
- - -
- - -
- - 3,782,097
73,646 - 121,159
77,810 2,003,390 14,409,613
(77,810) (269,720) (3,881,367)
- - -
- - -
- 19,024 19,024
- - -
(6,180) - (6,180)
- - 2,183
(6,180) 19,024 15,027
(83,990) (250,696) (3,866,340)
- - 132,335
- - (482,237)
(83,990) (250,696) (4,216,242)
(221,317) (2,189,171) (9,984,212)
(305,307)$ (2,439,867)$ (14,200,454)$
163
City of Azusa
Combining Statement of Cash Flows
Internal Service Funds
For the year ended June 30, 2020
Consumer Central
Services Self-Insurance Services
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers and users 5,212,318$ 2,968,760$ -$
Cash paid to suppliers for goods and services (3,359,946) (4,403,784) -
Cash paid to employees for services (2,644,915) (81,015) -
Net cash provided by (used in) operating activities (792,543) (1,516,039) -
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Cash receipts from other funds - 1,514,627 -
Cash disbursements to other funds (349,902) - -
Cash receipts from grants 521,020 - -
Net cash provided by noncapital financing activities 171,118 1,514,627 -
CASH FLOWS FROM CAPITAL AND RELATED FINANCING
ACTIVITIES:
Acquisition and construction of capital assets (640,482) - -
Proceeds from sale of capital assets 2,183 - -
Net cash provided by (used in) capital and related financing activities (638,299) - -
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest received 209,436 1,412 -
Net cash provided by (used in) investing activities 209,436 1,412 -
Net increase (decrease) in cash and cash equivalents (1,050,288) - -
CASH AND CASH EQUIVALENTS:
Beginning of year 1,050,288 - 3,309
End of year -$ -$ 3,309$
RECONCILIATION OF OPERATING INCOME TO NET
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:
Operating income (loss)(1,117,034)$ (2,415,311)$ (1,492)$
Adjustments to reconcile operating income (loss) to net
cash provided by (used in) operating activities:
Depreciation 46,021 - 1,492
Changes in current assets and liabilities:
(Increase) decrease in accounts receivable (319,274) (294,224) -
(Increase) decrease in prepaid expense 404 (318,724) -
(Increase) decrease in deferred OPEB related outflows (210,503) - -
(Increase) decrease in deferred pension related outflows 178,101 2,704 -
Increase (decrease) in accounts payable (29,372) 82,049 -
Increase (decrease) in accrued liabilities 32,107 (3,424) -
Increase (decrease) in claims and judgements - 1,417,327 -
Increase (decrease) in compensated absences 4,593 - -
Increase (decrease) in total OPEB liability 305,594 - -
Increase (decrease) in net pension liability 378,886 13,281 -
Increase (decrease) in deferred pension related inflows (62,066) 283 -
Total adjustments 324,491 899,272 1,492
Net cash provided by (used in) by operating activities (792,543)$ (1,516,039)$ -$
164
Equipment
Replacement IT Services Totals
-$ 1,734,150$ 9,915,228$
(68,575) (1,058,555) (8,890,860)
- (705,539) (3,431,469)
(68,575) (29,944) (2,407,101)
369,617 - 1,884,244
- - (349,902)
- 19,024 540,044
369,617 19,024 2,074,386
(301,042) - (941,524)
- - 2,183
(301,042) - (939,341)
- - 210,848
- - 210,848
- (10,920) (1,061,208)
- 231,035 1,284,632
-$ 220,115$ 223,424$
(77,810)$ (269,720)$ (3,881,367)$
73,646 - 121,159
- 480 (613,018)
(44,466) (39,524) (402,310)
- - (210,503)
- 71,883 252,688
(19,945) 18,025 50,757
- 1,462 30,145
- - 1,417,327
- (13,495) (8,902)
- - 305,594
- 215,767 607,934
- (14,822) (76,605)
9,235 239,776 1,474,266
(68,575)$ (29,944)$ (2,407,101)$
165
City of Azusa
Agency Fund
Statement of Changes in Fiduciary Assets and Liabilities
Balance Balance
July 1, 2019 Additions Deductions June 30, 2020
Agency Fund
Assets:
Cash and investments 11,336,219$ -$ (7,174,347)$ 4,161,872$
Accounts receivable 330,043 84,866 - 414,909
Taxes receivable 658 112,490 - 113,148
Restricted cash and investments with fiscal agent 386,647 11,954,094 - 12,340,741
Total assets 12,053,567$ 12,151,450$ (7,174,347)$ 17,030,670$
Liabilities:
Accounts payable 105,049$ -$ -$ 213,447$
Accrued liabilities 980 1 - 981
Deposits payable 11,947,538 4,868,704 - 16,816,242
Total liabilities 12,053,567$ 4,868,705$ -$ 17,030,670$
For the year ended June 30, 2020
166
City of Azusa
Supplemental Statement of Revenues, Expenses, and Changes in Fund Net Position
Water - Enterprise Fund
For the year ended June 30, 2020
Water
OPERATING REVENUES:
Residential sales 12,670,639$
Commercial sales 4,751,953
Industrial sales 2,379,708
Other sales 1,835,070
Fees 531,262
Other revenue 2,179,962
Total operating revenues 24,348,594
OPERATING EXPENSES:
Production 9,768,377
Transmission and distribution 3,073,130
Customer accounting and sales 3,261,176
Uncollectible accounts 14,595
Administration and general 2,246,577
Depreciation expense 3,811,721
Total operating expenses 22,175,576
OPERATING INCOME (LOSS)2,173,018
NONOPERATING REVENUES (EXPENSES):
Interest revenue 548,344
Interest expense (1,766,514)
Special franchise fees (443,650)
Gain on disposal of capital assets 326
Total nonoperating revenues (expenses)(1,661,494)
INCOME (LOSS) BEFORE TRANSFERS 511,524
Transfer out (739,584)
Change in net position (228,060)
Net position:
Beginning of year 51,728,428
End of year 51,500,368$
167
City of Azusa
Supplemental Statement of Revenues, Expenses, and Changes in Fund Net Position
Light - Enterprise Fund
For the year ended June 30, 2020
Light
OPERATING REVENUES:
Sale/electricity - residential 13,484,205$
Sale/electricity - commercial and industrial 20,628,273
Sale/electricity - other 1,361,205
Sale/electricity - resale 2,735,010
Other revenue 1,766,805
Total operating revenues 39,975,498
OPERATING EXPENSES:
Purchase power 16,414,296
Transmission/dispatching 4,183,532
Operation and maintenance 3,954,698
Uncollectible accounts 16,152
Administration and general 6,305,065
Depreciation expense 1,334,443
Total operating expenses 32,208,186
OPERATING INCOME (LOSS)7,767,312
NONOPERATING REVENUES (EXPENSES):
Interest revenue 550,712
Interest expense (121,243)
Special franchise fees (3,579,745)
Total nonoperating revenues (expenses)(3,150,276)
INCOME (LOSS) BEFORE TRANSFERS 4,617,036
Transfer out (584,407)
Change in net position 4,032,629
Net position:
Beginning of year 56,337,186
End of year 60,369,815$
168
Pages
Financial Trends
170-174
Revenue Capacity
175-187
Debt Capacity
188-194
Demographic and Economic Information
195-197
Operating Information
198-200
These schedules contain information to help the reader assess the City's significant
local revenue sources.
These schedules contain information to help the reader assess the affordability of the
City's levels of outstanding debt and the ability to issue additional debt in the future.
These schedules offer demographic and economic indicators to assist the reader to
understand the environment in which the City's financial activities take place.
These schedules contain service and infrastructure data to help the reader understand
how the information in the City's financial report relates to the services the City
provides and the activities it performs.
CITY OF AZUSA
Statistical Section
This part of the City of Azusa's comprehensive annual financial report presents detailed information as a context to aid
the reader in understanding the information presented in the financial statements, the required supplementary
information and the City's overall financial health.
These schedules contain trend information to help the reader understand how the
City's financial performance and well-being have changed over time.
169
Last Ten Fiscal Years (accrual basis of accounting)
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Governmental activities:
Net investment in capital assets 19,297,862$ 28,862,696$ 29,086,566$ 29,959,431$ 28,121,302$ 33,586,894$ 33,818,379$ 35,435,990$ 35,457,264$ 37,408,295$
Restricted 35,312,033 5,306,039 8,800,537 9,222,166 10,658,744 12,664,389 11,262,725 11,653,156 13,301,354 15,197,634
Unrestricted (50,982,746) 23,447,281 18,107,479 (7,774,851) (46,416,171) (47,761,262) (65,540,615) (71,783,787) (75,050,931) (82,049,250)
Total governmental activities net position 3,627,149$ 57,616,016$ 55,994,582$ 31,406,746$ (7,636,125)$ (1,509,979)$ (20,459,511)$ (24,694,641)$ (26,292,313)$ (29,443,321)$
Business-type activities:
Net investment in capital assets 35,160,311$ 60,564,169$ 55,086,846$ 58,465,869$ 45,617,124$ 56,985,265$ 50,924,797$ 52,197,779$ 53,360,644$ 62,764,524$
Restricted 3,192,561 10,845,193 11,554,302 9,845,901 15,085,506 11,448,778 16,722,108 16,307,140 16,784,663 16,991,779
Unrestricted 85,047,584 53,464,644 55,694,676 46,533,746 42,093,086 36,790,964 38,640,042 41,228,368 45,814,285 39,335,644
Total business-type activities net position 123,400,456$ 124,874,006$ 122,335,824$ 114,845,516$ 102,795,716$ 105,225,007$ 106,286,947$ 109,733,287$ 115,959,592$ 119,091,947$
Primary government:
Net investment in capital assets 54,458,173$ 89,426,865$ 84,173,412$ 88,425,300$ 73,738,426$ 90,572,159$ 84,743,176$ 87,633,769$ 88,817,908$ 100,172,819$
Restricted 38,504,594 16,151,232 20,354,839 19,068,067 25,744,250 24,113,167 27,984,833 27,960,296 30,086,017 32,189,413
Unrestricted 34,064,838 76,911,925 73,802,155 38,758,895 (4,323,085) (10,970,298) (26,900,573) (30,555,419) (29,236,646) (42,713,606)
Total primary government net position 127,027,605$ 182,490,022$ 178,330,406$ 146,252,262$ 95,159,591$ 103,715,028$ 85,827,436$ 85,038,646$ 89,667,279$ 89,648,626$
Source: City of Azusa Finance Department
Source: CAFR State of Net Position
CITY OF AZUSA
Table 1 - Net Position by Com
Fiscal Year
170
Last Ten Fiscal Years (accrual basis)
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Program Revenue:
Governmental activities:
Charges for services
General government 3,855,810$ 3,090,304$ 2,304,290$ 3,919,876$ 3,517,810$ 4,157,243$ 4,822,316$ 5,065,921$ 6,365,067$ 7,609,852$
Public Safety 713,846 721,032 705,140 829,054 741,551 821,281 774,218 649,929 1,403,390 2,343,224
Community development 1,915,741 2,615,631 2,831,860 3,296,987 3,044,683 2,463,012 3,094,335 3,162,591 3,303,062 2,569,245
Parks and recreation 997,277 1,046,584 1,090,771 1,181,561 1,226,392 1,188,778 487,842 478,140 437,829 344,432
Public Works 364,910 838,958 476,506 525,343 961,875 739,521 833,440 875,283 965,868 878,053
Operating grants and contributions 3,651,491 3,267,287 2,121,638 3,836,479 13,926,073 6,435,839 4,014,559 6,999,678 6,114,947 7,986,715
Capital grants and contributions 109,226 137,102 2,988,760 442,727 398,905 328,662 935,622 1,384,675 2,094,896 2,424,903
Total governmental activities
program revenues 11,608,301 11,716,898 12,518,965 14,032,027 23,817,289 16,134,336 14,962,332 18,616,217 20,685,059 24,156,424
Business-type activities:
Charges for services
Water 17,779,417 20,062,118 21,604,435 21,762,242 21,515,397 20,317,053 20,785,465 22,028,440 22,249,594 24,348,594
Light 39,189,980 40,962,648 42,377,694 45,001,748 46,222,264 40,464,630 41,404,427 36,620,020 41,202,574 39,975,498
Sewer/Wastewater 1,615,840 2,223,876 2,480,008 2,566,676 2,636,707 2,679,660 2,750,999 2,979,516 3,133,857 3,292,951
Refuse contract 3,062,700 2,976,946 2,954,842 3,058,956 3,145,396 3,465,932 3,697,476 3,885,635 3,941,215 4,119,397
Operating grants and contributions 667,619 704,965 714,750 763,180
Total business-type activities
program revenues 61,647,937 66,225,588 69,416,979 72,389,622 73,519,764 66,927,275 69,305,986 66,218,576 71,241,990 72,499,620
Total primary government
program revenues 73,256,238$ 77,942,486$ 81,935,944$ 86,421,649$ 97,337,053$ 83,061,611$ 84,268,318$ 84,834,793$ 91,927,049$ 96,656,044$
Expenses:
Governmental activities:
General government 12,198,991$ 10,537,722$ 7,168,707$ 7,169,710$ 7,834,391$ 10,945,471$ 11,183,394$ 12,216,266$ 14,252,142$ 14,858,996$
Public safety 20,187,914 20,449,077 20,077,868 21,082,420 21,279,644 22,689,580 24,610,769 28,290,550 28,234,043 33,034,073
Community development 3,472,237 3,272,401 3,053,950 2,569,284 2,384,308 2,605,120 3,170,213 3,312,408 3,355,295 3,892,609
Parks and recreation 4,184,626 4,146,245 3,453,469 3,752,518 3,878,961 4,546,965 4,365,600 4,745,891 4,761,394 5,077,503
Public works 5,539,866 8,818,083 4,173,502 5,356,694 5,019,152 5,331,169 4,404,636 5,522,426 7,954,532 9,015,108
Interest on long-term debt 7,380,598 2,244,315 471,835 1,330,555 699,155 517,395 361,493 278,689 253,667 225,826
Total governmental activities
expenses 52,964,232 49,467,843 38,399,331 41,261,181 41,095,611 46,635,700 48,096,105 54,366,230 58,811,073 66,104,115
Business-type activities:
Water 19,680,719 19,364,355 19,199,120 18,345,227 21,497,271 19,429,769 20,511,527 22,538,051 23,608,977 24,608,822
Light 40,083,680 39,115,161 44,040,193 45,011,550 44,328,679 41,383,802 39,464,774 33,269,209 34,562,979 36,579,394
Sewer/Wastewater 1,982,241 2,083,756 4,828,680 2,434,295 2,368,124 2,131,684 2,220,602 2,624,377 2,344,737 2,705,943
Refuse contract 2,962,395 2,851,882 2,835,041 2,938,255 3,042,337 3,342,897 3,533,695 3,735,613 3,734,667 4,086,865
Total business-type activities
expenses 64,709,035 63,415,154 70,903,034 68,729,327 71,236,411 66,288,152 65,730,598 62,167,250 64,251,360 67,981,024
Total primary government
program expenses 117,673,267$ 112,882,997$ 109,302,365$ 109,990,508$ 112,332,022$ 112,923,852$ 113,826,703$ 116,533,480$ 123,062,433$ 134,085,139
Source: CAFR Statement of Activities
Fiscal Year
CITY OF AZUSA
Table 2 - Changes in Net Position
171
Table 2 - Changes in Net Position (Continued)
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Net revenues (expenses):
Governmental activities (41,355,931) (37,750,945) (25,880,366) (27,229,154) (17,278,322) (30,501,364) (33,133,773) (35,750,013) (38,126,014) (41,947,691)
Business-type activities (3,061,098) 2,810,434 (1,486,055) 3,660,295 2,283,353 639,123 3,575,388 4,051,326 6,990,630 4,518,596
Total net revenues (expenses)(44,417,029) (34,940,511) (27,366,421) (23,568,859) (14,994,969) (29,862,241) (29,558,385) (31,698,687) (31,135,384) (37,429,095)
General revenues and other changes in net position:
Governmental activities:
Taxes:
Property taxes, general purpose 12,108,155$ 9,856,354$ 8,312,351$ 8,023,547$ 8,531,515$ 9,134,084$ 10,719,463$ 11,122,669$ 11,722,603$ 12,520,153$
Transient occupancy taxes 192,659 210,923 224,359 223,675 261,815 347,965 366,579 719,318 869,899 765,096
Sales tax 5,678,177 6,234,614 6,904,400 7,183,809 7,530,257 8,001,941 5,516,848 5,665,876 6,316,359 6,817,957
Franchise taxes 6,222,537 6,355,828 6,526,496 6,757,708 7,328,977 7,575,506 6,893,264 6,747,947 7,082,356 7,059,663
Business licenses taxes 1,822,102 1,865,195 1,983,634 1,922,139 2,008,916 1,995,000 2,238,439 2,208,309 2,065,327 2,067,693
Utility users tax 3,160,788 3,250,469 3,305,545 3,441,178 3,594,092 3,266,383 3,329,293 3,032,095 3,255,562 3,267,346
Other taxes 2,678,727 1,272,967 1,963,904 1,763,038 2,058,967 1,851,142 1,702,902 1,602,546 1,556,157 1,488,465
Motor vehicle in lieu-unrestricted 143,401 420,126 25,224 20,876 - - - - -
Investment income 2,540,133 1,284,484 166,674 (423,898) 353,285 183,908 460,691 (202,455) 609,862 859,705
Other general revenues 854,945 (50,068) 279,447 759,132 629,507 1,709,757 1,504,953 111,705 1,034,504 1,086,770
- 59,933,832 - - (4,113,065) - - - -
Transfers 1,326,374 1,082,262 1,309,808 1,535,996 1,458,028 1,652,338 1,739,277 2,031,610 1,866,900 2,607,313
Total governmental activities 36,727,998 91,716,986 31,001,842 31,207,200 29,642,294 35,718,024 34,471,709 33,039,620 36,379,529 38,540,161
Business-type activities:
Property taxes, general purpose 571,036 555,225 556,161 542,409 574,179 630,981 - - - -
Investment income 1,626,291 257,653 115,380 300,515 378,713 532,303 512,838 1,045,895 1,087,005 1,221,072
Gain on sale of assets 1,350 (1,966,003) (3,690) - - - - - -
Transfers (1,326,374) (1,082,262) (1,309,808) (1,535,996) (1,458,028) (1,652,338) (1,739,277) (2,031,610) (1,866,900) (2,607,313)
Miscellaneous 358,891 884,535 359,573 399,293 224,680 2,347,066 - - - -
Total business-type activities 1,231,194 (1,350,852) (282,384) (293,779) (280,456) 1,858,012 (1,226,439) (985,715) (779,895) (1,386,241)
Total general revenues 37,959,192 90,366,134 30,719,458 30,913,421 29,361,838 37,576,036 33,245,270 32,053,905 35,599,634 37,153,920
Changes in net position:
Governmental activities (4,627,933) 53,966,041 5,121,476 3,978,046 12,363,972 5,216,660 1,337,936 (2,710,393) (1,746,485) (3,407,530)
Business-type activities (1,829,904) 1,459,582 (1,768,439) 3,366,516 2,002,897 2,497,135 2,348,949 3,065,611 6,210,735 3,132,355
Total primary government (6,457,837)$ 55,425,623$ 3,353,037$ 7,344,562$ 14,366,869$ 7,713,795$ 3,686,885$ 355,218$ 4,464,250$ (275,175)$
Source: City of Azusa Finance Department
Source: CAFR Statement of Activities (page 2, General Revenues & Transfers Schedule)
CITY OF AZUSA
Last Ten Fiscal Years (accrual basis)
yg /(
redevelopment agency
Fiscal Year
172
Table 3 - Fund Balances of Governmental Funds
General fund:2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Nonspendable 21,615,263$ 20,951,468$ 20,993,673$ 20,927,944$ 16,794,925$ 17,319,446$ 14,315,813$ 14,247,791$ 9,342,604$ 9,228,259$
Unassigned (5,311,304) (5,817,312) (4,690,928) (509,996) 2,752,257 5,833,733 10,748,092 8,175,057 18,008,711 24,672,194
Total general fund:16,303,959$ 15,134,156$ 16,302,745$ 20,417,948$ 19,547,182$ 23,153,179$ 25,063,905$ 22,422,848$ 27,351,315$ 33,900,453$
Grants and Seizure:
Nonspendable 8,730$ 2,891$ -$ -$ -$
Restricted - 1,609,588 - - -
Unassigned (2,459,180) (420,193) - - -
Total grants and seizure:(2,450,450)$ 1,192,286$ -$ -$ -$
All other governmental funds:
Nonspendable 14,892,551$ 8,038$ 23,729$ 11,363$ 10,431$ 4,428$ 3,074$ 4,204$ 6,441$ 6,666$
Restricted 23,297,599 11,062,074 9,005,070 9,222,166 10,499,020 12,659,961 13,166,548 15,603,843 16,337,353 18,205,022
Committed - - - - - - - 498,066 498,066 1,466,620
Unassigned (32,625,038) (187,467) (376,870) (125,576) (12,478) (35,499) (499,998) (358,442) 1,682,866 (102,406)
Total all other governmental funds: 5,565,112$ 10,882,645$ 8,651,929$ 9,107,953$ 10,496,973$ 12,628,890$ 12,669,624$ 15,747,671$ 18,524,726$ 19,575,902$
Grants and Seizure did not meet major fund requirements in fiscal year 2015-16.
Source: City of Azusa Finance Department
Source: CAFR Balance Sheet Governmental Funds
CITY OF AZUSA
Last Ten Fiscal Years (modified accrual basis)
Fiscal Year
173
Table 4 - Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years (modified accrual basis)
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Revenues:
Taxes 32,206,954$ 29,353,626$ 29,180,382$ 29,266,387$ 31,314,539$ 32,172,021$ 34,549,619$ 35,537,492$ 37,784,665$ 38,934,050$
Assessments 3,098,219 2,201,117 1,605,028 2,216,830 1,299,713 1,875,271 1,941,549 2,232,012 2,612,037 2,547,233
Licenses and permits 610,298 1,270,221 1,369,901 1,586,117 1,600,109 1,096,325 1,167,805 1,164,736 1,128,547 786,793
Intergovernmental 3,829,513 3,482,499 2,856,210 4,469,748 4,674,688 3,635,890 6,317,682 4,134,939 5,848,721 6,113,774
Charges for services 3,059,369 3,399,276 3,288,109 4,396,994 4,647,255 4,505,844 3,775,160 3,641,642 4,297,902 6,385,202
Developer participation 1,297,580 - - - - - -
Investment income 994,621 872,118 157,022 131,515 346,266 442,987 990,976 308,488 1,814,430 1,572,459
Fines and forfeitures 119,111 978,829 989,616 1,343,318 1,343,809 1,328,383 1,068,510 1,124,080 1,447,695 1,383,846
Contributions 157,930 109,255 64,461 84,870 10,864,485 99,594 78,836 103,502 75,669 79,740
Miscellaneous - 1,492,038 384,382 870,199 678,623 1,759,473 1,563,941 162,787 1,216,960 1,146,990
Total Revenues 45,373,595 43,158,979 39,895,111 44,365,978 56,769,487 46,915,788 51,454,078 48,409,678 56,226,626 58,950,087
Expenditures:
Current:
General government 10,623,623 10,070,713 7,168,707 6,762,467 6,684,724 7,545,443 10,919,440 9,846,360 9,408,809 9,328,388
Public safety 19,824,369 20,379,672 20,077,868 20,877,090 21,779,069 22,490,820 22,560,287 25,727,339 24,740,726 27,199,160
Community development 3,423,224 3,223,201 3,053,950 2,564,915 2,364,558 2,588,161 2,970,565 3,017,805 3,079,943 3,419,525
Parks and recreation 3,729,125 3,770,465 3,453,469 3,561,491 3,589,952 4,212,160 3,916,250 4,161,675 4,109,326 3,984,832
Public works 4,204,180 7,358,644 4,173,502 4,245,273 4,033,352 4,304,379 4,286,018 4,205,386 5,134,171 4,628,255
Capital Outlay 2,762,698 1,554,151 2,348,624 2,204,482 1,725,176 6,433,318 1,128,736 3,486,632 3,358,548 4,964,647
Debt service:
Principal retirement 2,494,212 2,615,717 1,479,367 1,706,996 12,160,286 1,230,000 1,420,000 1,604,111 444,393 468,553
Interest and fiscal charges 7,295,680 2,537,665 471,835 401,265 417,459 562,530 405,392 344,203 260,901 229,866
Total Expenditures 54,357,111 51,510,228 42,227,322 42,323,979 52,754,576 49,366,811 47,606,688 52,393,511 50,536,817 54,223,226
Excess (Deficiency) of revenues
over (under) expenditures (8,983,516) (8,351,249) (2,332,211) 2,041,999 4,014,911 (2,451,023) 3,847,390 (3,983,833) 5,689,809 4,727,861
Other Financing Sources (Uses):
Capital lease financing - - - - - - - 162,000 - -
Transfer in 24,569,629 5,900,632 6,003,156 6,310,394 6,174,749 6,839,073 7,852,410 8,636,279 8,259,865 9,922,671
Transfer out (23,841,239) (4,818,370) (4,705,827) (4,777,269) (5,569,235) (5,316,340) (6,113,133) (6,604,669) (6,392,965) (7,315,358)
Notes and loans issued 986,314 1,305,892 - - - 3,570,000 - - - -
Other financing sources - - - - - 168,899 4,307 1,034,927 - 8,618
Total Other Financing Sources
(Uses) 1,714,704 2,388,154 1,297,329 1,533,125 605,514 5,261,632 1,743,584 3,228,537 1,866,900 2,615,931
Extraordinary gain/(loss) on dissolution
of redevelopment agency - 10,087,999 - - (4,113,065) - - - -
Net change in fund balances (7,268,812)$ 4,124,904$ (1,034,882)$ 3,575,124$ 507,360$ 2,810,609$ 5,590,974$ (755,296)$ 7,556,709$ 7,343,792$
Debt service as a percentage of noncapital expenditures 19.0%10.3%4.9%5.3%24.6%4.2%3.9%4.0%1.5%1.4%
Source: City of Azusa Finance Department
Source: CAFR Statement of Revenues, Expenditures & Changes in Fund Balances Governmental Funds
CITY OF AZUSA
Fiscal Year
174
Fiscal Year Residential
Commercial/
Industrial Other Total
2011 10,605,804 21,041,098 1,238,881 32,885,783$
2012 11,769,253 22,392,573 1,272,683 35,434,509$
2013 12,191,958 22,259,074 1,422,284 35,873,316$
2014 11,970,815 22,893,681 1,595,780 36,460,276$
2015 12,995,948 24,356,790 1,516,934 38,869,672$
2016 12,570,806 21,957,543 1,340,305 35,868,654$
2017 12,861,348 22,550,702 1,431,251 36,843,301$
2018 11,739,362 20,198,935 1,391,350 33,329,647$
2019 13,032,871 21,504,981 1,467,800 36,005,652$
2020 12,371,785 18,669,444 1,218,595 32,259,824$
Source: City of Azusa Light & Water Department
City of Azusa
Table 5 - Light Department
Electricity Sold by Type of Customer
Last Ten Fiscal Years
Type of Customer
175
Fiscal Monthly Rate per Rate per
Year Ended Base 0 - 250 >250
June 30 Rate kWh kWh
2011 3.81 0.1160 0.1487
2012 3.81 0.1160 0.1487
2013 3.81 0.1160 0.1487
2014 3.81 0.1160 0.1487
2015 3.81 0.1160 0.1487
2016 3.81 0.1160 0.1487
2017 3.81 0.1160 0.1487
2018 5.80 0.1091 0.1487
2019 5.80 0.1091 0.1487
2020 5.80 0.1091 0.1487
NOTE:
Source: City of Azusa Light & Water Department
City of Azusa
Table 6 - Electricity Rates
Last Ten Fiscal Years
Rates are based on residential meter, which is the standard
household meter size. There is an additional charge for excess-
use rate above normal demand.
176
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177
Table 7 - 10 Largest Electrical Customers
2011 2012 2013 2014
Percentage Percentage Percentage Percentage
of Total of Total of Total of Total
Light Light Light Light Light Light Light Light
Light Customer:Charges Revenues Charges Revenues Charges Revenues Charges Revenues
APU Foundation 2,104,018$ 6.398% 1,741,024$ 4.913% 1,780,989$ 4.965% 1,802,237$ 4.943%
Archcom Technology - 0.000% 223,383 0.630%- 0.000%- 0.000%
Artisan Screen Process 319,455 0.971% 301,378 0.851%- 0.000% 546,126 1.498%
Azusa MRFTS - 0.000%- 0.000%- 0.000%- 0.000%
Azusa USD 954,045 2.901% 896,318 2.530% 856,373 2.387% 883,569 2.423%
Azusa Western 241,542 0.734% 232,823 0.657%- 0.000%- 0.000%
Buena Vista Food Prod 312,836 0.951% 329,687 0.930% 333,594 0.930% 357,445 0.980%
California Amforge Corp 213,367 0.649% 295,442 0.834% 651,233 1.815%- 0.000%
Calmat Cite 2353-P3 0.000%0.000%0.000%0.000%
City of Azusa 1,112,047 3.382% 1,045,326 2.950% 1,206,165 3.362% 1,347,507 3.696%
City of Glendora 575,089 1.749% 72,098 0.203% 679,753 1.895% 613,336 1.682%
Costco Wholesale Corp 612,630 1.863% 613,230 1.731% 642,560 1.791% 646,887 1.774%
Criterion Catalyst & Tech LP 181,832 0.553%- 0.000%- 0.000%- 0.000%
Hansen's Juices (Naked Juice)- 0.000%- 0.000%- 0.000%- 0.000%
LA County Metro
Transporation Authority - 0.000%- 0.000%- 0.000%- 0.000%
Morris Partnership 156,898 0.477% 226,681 0.640%- 0.000%- 0.000%
Northrop Grumman 504,436 1.534% 468,774 1.323% 366,623 1.022% 482,780 1.324%
Rainbird Corp/CA Division 933,722 2.839% 193,342 0.546%- 0.000%- 0.000%
S & S Foods LLC 1,444,281 4.392% 1,386,170 3.912% 1,584,047 4.416% 1,679,420 4.606%
Stater Bros Market - 0.000% 145,484 0.411%- 0.000%- 0.000%
Target Corporation - 0.000% 301,707 0.851%- 0.000%- 0.000%
T H Molding Corporation - 0.000% 401,075 1.132%- 0.000%- 0.000%
Thermal Remediation Solutions 195,798 0.595% 154,795 0.437%- 0.000%- 0.000%
Verizon Wireless Inc 601,882 1.830% 894,493 2.524% 1,064,241 2.967% 1,205,326 3.306%
Total 10,463,878$ 31.819% 9,923,230$ 28.004% 9,165,578$ 25.866% 9,564,633$ 26.233%
Source: City of Azusa Light & Water Department
City of Azusa
Last Seven Fiscal Years
178
2015 2016 2017 2018 2019 2020
Percentage Percentage Percentage Percentage Percentage Percentage
of Total of Total of Total of Total of Total of Total
Light Light Light Light Light Light Light Light Light Light Light Light
Charges Revenues Charges Revenues Charges Revenues Charges Revenues Charges Revenues Charges Revenues
1,825,551$ 4.697% 1,745,792$ 4.867% 1,717,597$ 4.662% 1,671,228$ 5.014% 1,583,534$ 4.158% 1,535,257$ 4.314%
- 0.000% - 0.000% - 0.000% - 0.000% - 0.000%- 0.000%
477,290 1.228% - 0.000% - 0.000% - 0.000% - 0.838%- 0.000%
597,615 1.537% 587,778 1.639% 589,515 1.600% 591,552 1.775% 567,922 1.744% 515,256 1.448%
902,905 2.323% 871,002 2.428% 841,194 2.283% 811,555 2.435% 797,439 0.000% 654,856 1.840%
- 0.000% - 0.000% - 0.000% - 0.000% - 0.000%- 0.000%
382,480 0.984% - 0.000% - 0.000% - 0.000% - 0.000%- 0.000%
- 0.000% 270,488 0.754% 273,803 0.743% - 0.000% - 0.000%- 0.000%
0.000% 451,282 1.258% 442,621 1.201% 459,465 1.379% - 1.145%- 0.000%
1,228,641 3.161% 1,166,557 3.252% 1,249,473 3.391% 1,334,505 4.004% 1,288,927 0.000% 1,183,862 3.327%
479,889 1.235% 540,173 1.506% 693,404 1.882% 691,574 2.075% 591,631 1.665% 694,230 1.951%
- 0.000% - 0.000% - 0.000% 623,458.45 1.871% 543,874.88 1.643% 555,487 1.561%
- 0.000% - 0.000% - 0.000% - 0.000% - 0.000%- 0.000%
- 0.000% - 0.000% - 0.000% - 0.000% - 0.000%- 0.000%
- 0.000% - 0.000% 464,543 1.261% 484,024 1.452% 530,496 1.637% 536,079 1.506%
- 0.000% - 0.000% - 0.000% - 0.000% - 0.000%- 0.000%
466,673 1.201% 503,809 1.405% 491,900 1.335% - 0.000% 481,445 1.012% 460,150 1.293%
- 0.000% - 0.000% - 0.000% - 0.000% - 0.000%- 0.000%
1,645,159 4.233% 1,672,106 4.662% 1,728,231 4.691% 1,553,231 4.660% 1,502,357 4.611% 1,506,057 4.232%
- 0.000% - 0.000% - 0.000% - 0.000% - 0.000%- 0.000%
- 0.000% - 0.000% - 0.000% - 0.000% - 0.000%- 0.000%
- 0.000% - 0.000% - 0.000% - 0.000% - 0.000%- 0.000%
- 0.000% - 0.000% - 0.000% - 0.000% - 0.000%- 0.000%
1,357,641 3.493% 1,265,361 3.528% - 0.000% 1,165,298 3.496% 1,172,185 3.359% 1,217,518 3.421%
9,363,844$ 24.090% 9,074,348$ 25.299% 8,492,281$ 23.050% 9,385,890$ 46.467% 9,059,811$ 27.182% 8,858,752$ 24.604%
179
Last Ten Fiscal Years
Fiscal Year Residential
Commercial Industrial Other (2)Total
2011 9,640,301 3,461,006 2,532,726 1,018,571 16,652,604$
2012 9,883,807 3,553,448 2,555,016 1,082,702 17,074,973$
2013 10,434,389 3,815,664 2,621,551 1,267,068 18,138,672$
2014 10,324,448 3,822,126 2,486,936 1,223,852 17,857,362$
2015 9,878,211 3,877,869 2,305,504 1,152,660 17,214,244$
2016 8,899,454 3,429,934 2,282,486 1,031,834 15,643,708$
2017 9,614,576 3,693,444 2,918,906 1,471,927 17,698,853$
2018 10,327,873 4,034,433 2,895,842 1,654,212 18,912,360$
2019 10,197,688 3,855,885 2,791,376 1,608,271 18,453,220$
2020 10,625,094 3,850,353 2,517,475 1,069,091 18,062,013$
Source: City of Azusa Light & Water Department
City of Azusa
Table 8 - Water Sold by Type of Customer
Type of Customer
180
Fiscal Monthly Tier 1 Tier 2 Tier 3
Year Ended Base Rate per Rate per Rate per
Activity Rate CCF CCF CCF
0-12 CCF >12 CCF
2011 17.03 1.007 1.953
2012 17.03 1.007 1.953
2013 17.03 1.007 1.953
0-12 CCF 13-36 CCF >36 CCF
07/13-04/14 17.03 1.007 1.953
05/14-06/14 17.03 1.007 2.129 3.031
2015 17.03 1.007 2.129 3.031
2016 17.03 1.007 2.129 3.031
0-4 CCF 5-15 CCF >15 CCF
2017 14.58 1.050 1.714 2.162
2018 14.87 1.071 1.748 2.206
2019 15.47 1.114 1.819 2.295
2020 15.47 1.137 1.855 2.341
NOTE:
(2) Tiers changed from 17 to 12 in July 2009.
(4) New rates were implented for FY 2016-17.
Source: City of Azusa Light & Water Department
City of Azusa
Table 9 - Water Rates
Last Ten Fiscal Years
(1) Rates are based on 3/4" meter, which is the standard household meter size. There is an additional
charge for excess-use rate above normal demand.
(3) A Phase III Drought was declared effective May 1, 2014, where a third tier was implemented.
181
Table 10 - Largest Water Customers
Last Ten Fiscal Years
2011 2012 2013 2014
Percentage Percentage Percentage Percentage
of Total of Total of Total of Total
Water Water Water Water Water Water Water Water
Water Customer:Charges Revenues Charges Revenues Charges Revenues Charges Revenues
APU Foundation 212,880$ 1.278% 126,737$ 0.742% 130,761$ 0.721% 138,644$ 11.328%
Azusa Carefree Association 52,285 0.314% 65,984 0.386% - 0.000% - 0.000%
Azusa Greens Country Club 114,596 0.688% 131,809 0.772% 163,455 0.901% 157,909 12.903%
Azusa Land Reclamation - 0.000%- 0.000%- 0.000%- 0.000%
Azusa USD 304,265 1.827% 285,883 1.674% 390,372 2.152% 380,303 31.074%
Azusa Western 244,528 1.468% 259,555 1.520% 262,656 1.448% 251,656 20.563%
Calmat Site #1055-A 54,439 0.327% 36,368 0.213% - 0.000% - 0.000%
Citrus College 45,507 0.273% 47,347 0.277% 49,133 0.271% - 0.000%
City of Azusa 141,459 0.849% 137,730 0.807% 150,954 0.832% 157,052 12.833%
Covina Valley USD 42,644 0.256% 110,587 0.648% 167,684 0.924% 142,356 11.632%
Crystal Canyon Assocation - 0.000%- 0.000%- 0.000%- 0.000%
Hector Perales - 0.000% - 0.000% - 0.000% - 0.000%
Lovin Oven 47,099 0.283% 52,250 0.306% - 0.000% - 0.000%
Mike Nijjar-060 - 0.000% 79,676.00 0.467% - 0.000% - 0.000%
Miller Brewery 1,149,331 6.902% 1,126,387 6.597% 1,155,227 6.369% 1,068,819 87.332%
Mountain Cove - 0.000% 68,138 0.399% - 0.000% - 0.000%
North Rosedale Comm Assoc - 0.000%- 0.000%- 0.000%- 0.000%
NCI 64,368 0.387% 68,253 0.400% - 0.000% - 0.000%
Ready Pac 499,358 2.999% 533,105 3.122% 556,493 3.068% 546,810 44.679%
S&S Foods LLC 113,343 0.681% 122,666 0.718% 132,658 0.731% 129,093 10.548%
Southern California Edison - 0.000% 34,983 0.205% - 0.000% - 0.000%
Villa Azusa Association - 0.000% 59,898 0.351% - 0.000% - 0.000%
Vulcan Materials - 0.000% - 0.000% - 0.000% 51,760 4.229%
Total 3,086,102$ 18.532% 3,347,356$ 19.604% 3,159,393$ 17.418% 3,024,402$ 16.936%
Source: City of Azusa Light & Water Department
City of Azusa
182
2015 2016 2017 2018 2019 2020
Percentage Percentage Percentage Percentage Percentage Percentage
of Total of Total of Total of Total of Total of Total
Water Water Water Water Water Water Water Water Water Water Water Water
Charges Revenues Charges Revenues Charges Revenues Charges Revenues Charges Revenues Charges Revenues
121,552$ 10.545% 142,796$ 6.256% 174,221 0.984% 145,658 0.770% 139,958 0.758% 159,509 0.739%
52,656.00 4.568% - 0.000%- 0.000%- 0.000% 99,716 0.540%- 0.000%
163,734 14.205% 205,146 8.988% 179,498 1.014% 168,221 0.889% 140,137 0.759% 158,163 0.733%
- 0.000%- 0.000%- 0.000%- 0.000% 281,016 1.523% 267,121 1.238%
309,041 26.811% 303,127 13.281% 398,863 2.254% 491,346 2.598% 419,292 2.272% 396,548 1.838%
277,779 24.099% 392,150 17.181% 322,098 1.820% 240,739 1.273%- 0.000%- 0.000%
- 0.000% - 0.000%- 0.000%- 0.000%- 0.000%- 0.000%
- 0.000% - 0.000%- 0.000%- 0.000%- 0.000%- 0.000%
116,061 10.069% 170,869 7.486% 215,483 1.217% 249,441 1.319% 243,291 1.318% 246,220 1.141%
145,329 12.608% 137,576 6.027% 140,192 0.792% 191,827 1.014% 168,466 0.913% 155,681 0.722%
- 0.000%- 0.000%- 0.000%- 0.000%- 0.000%- 0.000%
- 0.000% - 0.000%- 0.000%- 0.000%- 0.000%- 0.000%
- 0.000% - 0.000%- 0.000%- 0.000%- 0.000%- 0.000%
- 0.000% - 0.000%- 0.000%- 0.000%- 0.000%- 0.000%
957,677 83.084% 928,794 40.692% 977,763 5.524% 968,288 5.120% 968,327 5.247% 513,306 2.379%
- 0.000% 126,479.00 5.541%- 0.000%- 0.000%- 0.000%- 0.000%
- 0.000%- 0.000%- 0.000%- 0.000%- 0.000%- 0.000%
- 0.000% - 0.000%- 0.000% 105,078 0.556%- 0.000%- 0.000%
438,847 38.073% 564,237 24.720% 618,202 3.493% 653,219 3.454% 592,580 3.211% 510,323 2.365%
173,338 15.038% 129,519 5.674% 162,258 0.917% 145,158 0.768% 149,885 0.812% 113,497 0.526%
- 0.000% - 0.000%- 0.000%- 0.000%- 0.000%- 0.000%
- 0.000% - 0.000%- 0.000%- 0.000%- 0.000%- 0.000%
- 0.000% - 0.000%- 0.000%- 0.000%- 0.000% 109,711 0.508%
2,756,014$ 16.010% 3,100,693$ 135.846% 3,188,578$ 18.016% 3,358,975$ 17.761% 3,202,669$ 17.356% 2,630,079$ 12.189%
183
Taxable Assessed
Total Estimated Value as
Fiscal Year Total Taxable Direct Actual a Percentage
Ended Residential Commercial Other Assessed Tax Taxable of Actual
June 30 Property Property Property
Value (1)Rate Value Taxable Value
2011 1,989,337,299 285,686,418 967,335,236 3,242,358,953 0.34228 3,242,358,953 100.0%
2012 2,006,514,504 284,699,041 907,262,608 3,198,476,153 0.34311 3,198,476,153 100.0%
2013 2,065,151,644 276,567,248 900,529,536 3,242,248,428 0.33678 3,242,248,428 100.0%
2014 2,239,991,812 284,125,347 904,950,465 3,429,067,624 0.13976 3,429,067,624 100.0%
2015 2,486,788,064 285,681,045 907,790,565 3,680,259,674 0.13961 3,680,259,674 100.0%
2016 2,718,542,945 291,006,304 963,951,180 3,973,500,429 0.13918 3,973,500,429 100.0%
2017 2,952,542,573 310,843,612 963,889,518 4,227,275,703 0.13920 4,227,275,703 100.0%
2018 3,181,170,861 344,807,866 984,941,845 4,510,920,572 0.13812 4,510,920,572 100.0%
2019 3,382,188,399 395,863,426 1,032,586,758 4,810,638,583 0.13927 4,810,638,583 100.0%
2020 3,676,936,137 402,291,953 1,109,744,291 5,185,972,381 0.13926 5,185,972,381 100.0%
NOTES:
Exempt assessed values are not included in assessed value.
Source: HdL Coren & Cone
CITY OF AZUSA
Table 11 - Assessed Value and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
(in thousand of dollars)
In 1978 the voters of the State of California passed Proposition 13 which limited property taxes to a maximum rate of 1% based upon the assessed
value of the property being taxed. Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum
increase of 2%). With few exceptions, property is only reassessed at the time that it is sold to a new owner. At that point, the new assessed value is
reassessed at the purchase price of the property sold. The assessed valuation date shown above represents the only data currently available with
respect to the actual market value of taxable property and is subject to the limitations described.
Page 16
184
Table 12 - Direct and Overlapping Property Tax Rates
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
City Direct Rates:
General City 0.14921$ 0.14921$ 0.14921$ 0.14921$ 0.14921$ 0.14921$ 0.14921$ 0.14921$ 0.14921$ 0.14921$
Redevelopment Agency 1.01800 1.01800 (1)(1)(1)(1)(1)(1)(1)(1)
Total Direct Rate 0.34228 0.34311 0.33678 0.13976 0.13961 0.13918 0.13920 0.13812 0.13927 0.13926
Overlapping Rates:
Azusa Unified School District 0.05695 0.05628 0.04641 0.03765 0.04468 0.11479 0.10430 0.10591 0.09806 0.11416
Citrus Community College District 0.02516 0.02447 0.02590 0.02226 0.02327 0.01641 0.02406 0.02229 0.02238 0.02172
Covina Valley Unified School District 0.09003 0.08999 0.09500 0.11472 0.11426 0.11062 0.12581 0.14205 0.13976 0.13521
Duarte Unified School District 0.07542 0.11237 0.12657 0.12283 0.14263 0.14193 0.14398 0.14061 0.15864 0.15585
Metropolitan Water District 0.01800 0.01800 0.01800 0.01800 0.01800 0.01800 0.02300 0.03000 0.03000 0.03000
Mt. San Antonio College 0.02636 0.02642 0.02896 0.02023 0.02129 0.02154 0.02400 0.02371 0.02435 0.04781
Total Tax Rate 0.44113 0.47674 0.49005 0.48490 0.51334 0.57250 0.59436 0.61378 0.62240 0.62396$
(1)The Redevelopment Agency dissolution by the State of California caused the tax
allocation bonds to be transferred to the Successor Agency and is a fiduciary fund.
In 1978, California voters passed Proposition 13 which set the property tax rate at a 1.00% fixed amount.
Source: L.A. County Assessor 2008/09 - 2017/18 Tax Rate Table
This 1.00% is shared by all taxing agencies for which the subject property resides within. In addition to the
1.00% fixed amount, property owners are charged taxes as a percentage of assessed property values for the
payment of any voter approved bonds.
CITY OF AZUSA
(rate per $100 of assessed value)
Last Ten Fiscal Years
General fund tax rates are representative and based upon the direct and overlapping rates for the largest
General Fund tax rate area by net taxable value.
Total Direct Rate is the weighted average of all individual direct rates applied by the City. The Direct Rate percentages presented in the columns above is
not the sum of the General City Rate and the Redevelopment Agency Rate (RDA).
RDA rate is based on the largest RDA tax rate area and includes only rates from indebtedness adopted prior to 1989 per California State statute. RDA
direct and overlapping rates are applied only to the incremental property values.
Fiscal Year
185
Table 13 - Principal Property Tax Payers (Top Ten)
Current Year and Ten Years Ago
2020 2011
Percentage of Percentage of
City City
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxpayer Value Value Value Value
Northrop Grumman Systems Corporation 105,530,278 2.03% 113,614,802 3.50%
Citrus Crossing Properties Fee 28,702,841 0.55% 26,851,268 0.83%
Target Corporation 35,546,572 0.69% 0.00%
PPF Industrial 823 8th Street 35,630,912 0.69% 0.00%
10th Street XC LLC 32,256,675 0.62% 0.00%
Rainbird Corporation 29,807,292 0.57% 38,614,467 1.19%
Azusa Pacific University 0.00% 36,432,801 1.12%
The Launitas Brewing Company 22,386,690 0.43% 0.00%
Costco Wholesale Corporation 24,250,324 0.47% 0.00%
VPM Soldano Senior Village LP 22,122,649 0.43% 0.00%
Lakewood Gardens LP 21,564,104 0.42% 0.00%
Azusa Land Reclamation Inc 0.00% 0.00%
S & S Foods LLC 0.00% 19,350,079 0.60%
Rosedale Land Partners II LLC 0.00% 88,873,667 2.74%
Azusa Land Partners LLC 0.00% 0.00%
City View Rosedale 98 LP 0.00% 30,842,144 0.95%
PLC Mapleton LLC 0.00% 0.00%
Criterion Catalyst Company LP 0.00% 20,612,220 0.64%
PPF Industrial 823 985 8th Street 0.00% 30,372,856 0.94%
RC Properties VI LLC 0.00% 0.00%
William Lyon Homes Inc 0.00% 25,225,547 0.78%
357,798,337$ 6.90% 430,789,851$ 13.29%
The amounts shown above include assessed value data for both the City and the Redevelopment Agency/Successor Agency.
Source: HdL
City of Azusa
186
Amount
Taxes collected Collections Percent
Fiscal Year Levied within the Percent in Total of
Ended for the Fiscal Year of Subsequent Collections Levy
June 30 Fiscal Year of Levy Levy Years to Date to Date
2011 3,492,186 3,261,283 93.4% (3,421) 3,257,862 93.3%
2012 3,447,405 3,192,697 92.6% 16,662 3,209,360 93.1%
2013 3,506,941 3,404,604 97.1% 84,623 3,489,227 99.5%
2014 3,743,370 3,632,433 97.0% 74,318 3,706,751 99.0%
2015 4,006,854 3,891,541 97.1% 47,305 3,938,847 98.3%
2016 4,503,235 4,399,245 97.7% 66,910 4,466,155 99.2%
2017 4,465,379 4,408,195 98.7% 46,744 4,454,939 99.8%
2018 4,980,719 4,900,774 98.4% 79,945
(1)4,980,719 100.0%
2019 5,209,129 5,141,739 98.7% 10,022 5,151,761 98.9%
2020 5,525,221 5,419,325 98.1% 105,895 5,503,973 99.6%
(1)Restated
Source: County of Los Angeles Auditor-Controller and
City of Azusa Finance Department
Table 14 - Property Tax Levies and Collections
CITY OF AZUSA
Last Ten Fiscal Years
187
Last Ten Fiscal Years
Governmental Activities Business-type Activities
Fiscal Taxable Percentage Percentage
Year Certificate Tax Pension Unamortized Total Certificate Unamortized Total Total of of
Ended of Allocation Funding Premiums/ Governmental of Revenue Premiums/ Business-type Primary Assessed Personal
June 30 Loans Participation
Bonds (1)Bonds (2)(Discounts) Activities
Loans(7)Participation (3)Bonds (4)(Discounts) Activities Governmental Values Income
2011 9,685,015 3,255,000 54,768,014 6,180,000 - 73,888,029 - 25,690,000 54,275,000 - 79,965,000 153,853,029 4.75% 18.00%
2012 10,005,461 3,025,000 - (6)5,555,000 - 18,585,461 5,630,000 3,070,000 68,500,000 - 77,200,000 95,785,461 2.99% 10.85%
2013 10,403,644 2,785,000 - (6)4,855,000 - 18,043,644 5,405,000 2,540,000 68,180,000 - 76,125,000 94,168,644 2.90% 11.12%
2014 10,700,656 2,540,000 - 4,075,000 - 17,315,656 5,080,000 1,985,000 67,380,000 - 74,445,000 91,760,656 2.68% 10.85%
2015 - (8)2,285,000 - 3,205,000 - 5,490,000 4,730,000 1,400,000 65,445,000 - 71,575,000 77,065,000 2.09% 8.95%
2016 - 5,590,000 (9)- 2,240,000 179,828 7,830,000 4,365,000 780,000 60,205,000 3,836,045 69,186,045 77,016,045 1.94% 8.48%
2017 - 5,235,000 (9)- 1,175,000 158,030 6,568,030 3,990,000 130,000 58,320,000 3,589,433 66,029,433 72,597,463 1.72% 7.70%
2018 122,889 (10)4,845,000 (9)- - 156,488 5,124,377 3,605,000 - 55,730,000 3,342,821 62,677,821 67,802,198 1.50% 6.91%
2019 83,496 4,440,000 (9)- - 154,946 4,678,442 3,205,000 - 52,910,000 3,096,209 59,211,209 63,889,651 1.33%(5)
2020 40,943 4,015,000 - - 153,404 4,209,347 2,790,000 - 49,970,000 2,849,597 55,609,597 59,818,944 1.15%
(1)The Redevelopment Agency issued $9,051,416 of new TABS in 2005, $15,780,000 2007 Series A Merged Project Area TABS and $4,790,000 Series B Merged Project area TABS,$6,715,000 2008
Series A Merges Project Area TABS, and $11,580,000 2008 Housing Tax Allocation Bonds Series B.
(2)The City issued $7,215,000 of taxable pension funding bonds in 2008
(3)The Light Fund issued $11,995,000 of new Certificates of Participation in 2003; issued refunding revenue bonds of $5,820,000 in 2012.
(4)The Water Fund replaced its Revenue Bond with Certificates of Participation in December 2003; issued refunding revenue bonds of $8,715,000 in 2012, and refunded the 2006 bonds with 2015 issuance.
(5)Information not available
(6)The Redevelopment Agency dissolution by the State of California caused the tax allocation bonds to be transferred to the Successor Agency and is a fiduciary fund.
(7)The Sewer Fund acquired an installment sale agreement loan of $5,630,000 in 2011 that includes the refunding of 1994 COPs.
(8)The term of the loan expired and the remaining balance was forgiven.
(9)Includes 2003 COPs and 2016 T.R.I.P installment agreement.
(10)The General Fund entered into a capital lease agreement to fund the purchase of four police vehicles.
Source: City of Azusa Finance Department
CITY OF AZUSA
Table 15 - Ratios of Outstanding Debt by Type
188
Restricted
Fiscal Year Certificates Tax Resources for Debt per
Ended of Allocation General Net General City
June 30 Participation Bonds Bonded Debt Bonded Debt Capita
2010 3,480,000 55,814,889 Not Available 59,294,889 1,205
2011 3,255,000 54,768,014 Not Available 58,023,014 1,245
2012 3,025,000 (1)Not Available 3,025,000 64
2013 2,785,000 (1)482,620 2,302,380 48
2014 2,540,000 (1)482,591 2,057,409 43
2015 2,285,000 (1)482,612 1,802,388 36
2016 2,020,000 (1)483,430 1,536,570 31
2017 1,745,000 (1)484,302 1,260,698 25
2018 1,460,000 (1)487,427 972,573 19
2019 1,160,000 (1)517,330 642,670 13
2020 845,000 (1)513,111 331,889 7
(1)The Redevelopment Agency dissolution by the State of California caused the tax
allocation bonds to be transferred to the Successor Agency and is a fiduciary fund.
Source: City of Azusa Finance Department
CITY OF AZUSA
Table 16 - Ratio of General Bonded Debt Outstanding
Last Ten Fiscal Years
189
City's Share
Total Debt Applicable of Debt
Overlapping debt repaid with property taxes1
METROPOLITAN WATER DISTRICT 18,151,752$ 0.130%23,597$
CITRUS CCD DS REF BOND SERIES 2013 13,130,302 16.669%2,188,690
CITRUS CCD DS 2004 SERIES 2014D 18,696,403 16.669%3,116,503
CITRUS CCD DS 2004, 2015 SERIES E 9,805,000 16.669%1,634,395
CITRUS CCD DS REF BONDS 2015 SERIES A 45,435,000 16.669%7,573,560
MT. SAN ANTONIO CCD DS 2008 SERIES 13A 161,708,000 0.038%61,449
MT. SAN ANTONIO CCD DS 2008 SERIES 2013B 3,805,000 0.038%1,446
MT. SAN ANTONIO CCD DS 2013 REF SERIES A 23,500,000 0.038%8,930
MT. SAN ANTONIO CCD DS 2013 REF SERIES B 27,185,000 0.038%10,330
MT. SAN ANTONIO CCD DS 2008 SERIES 2015C 10,870,000 0.038%4,131
MT. SAN ANTONIO CCD DS 2015 REF BONDS 17,365,000 0.038%6,599
MT. SAN ANTONIO CCD DS 2018 SERIES 2019A 401,245,000 0.038%152,473
AZUSA UNIFIED 2002 SERIES 2007 28,920,359 68.318%19,757,811
AZUSA UNIFIED REFUND BOND 2002 SERIES 2011 12,150,000 68.318%8,300,637
AZUSA UNIFIED 2014 SERIES A 24,135,000 68.318%16,488,549
AZUSA UNIFIED REFUND BOND 2016 20,930,000 68.318%14,298,957
AZUSA UNIFIED 2014 SERIES B 750,000 68.318%512,385
AZUSA UNIFIED 2014 SERIES C 47,635,000 68.318%32,543,279
COVINA VALLEY USD DS 2001 SERIES B 9,447,069 0.366%34,576
COVINA VALLEY USD DS 2006, 07 SERIES B 1,935,000 0.366%7,082
COVINA VALLEY USD DS 2001 REFUND 2010 SERIES A 4,815,000 0.366%17,623
COVINA VALLEY USD DS 2012 SERIES A 11,865,000 0.366%43,426
COVINA VALLEY USD DS 2013 REF BONDS 36,145,000 0.366%132,291
COVINA VALLEY USD DS 2012 SERIES B 31,490,000 0.366%115,253
COVINA VALLEY USD DS 2012 SERIES C 29,380,000 0.366%107,531
COVINA VALLEY USD DS 2012 SERIES C 14,000,000 0.366%51,240
COVINA VALLEY USD DS 2012 SERIES D 58,690,000 0.366%214,805
DUARTE USD DS 1998 SERIES B 1,450,713 0.670%9,720
DUARTE USD DS 1998 SERIES C 3,409,820 0.670%22,846
DUARTE USD DS 1998 SERIES E 3,614,534 0.670%24,217
DUARTE USD DS REFUNDING 1998, 2010 SERIES A 9,476,470 0.670%63,492
DUARTE USD DS 2010 SERIES A 875,000 0.670%5,863
DUARTE USD DS 2010 SERIES B 16,726,042 0.670%112,064
DUARTE USD DS 2013 REF BONDS 1,325,000 0.670%8,878
DUARTE USD DS 2010 SERIES C 6,695,000 0.670%44,857
DUARTE USD DS 2010 SERIES D 19,881,918 0.670%133,209
DUARTE USD DS 2010 SERIES E 5,000,000 0.670%33,500
Total Overlapping Debt 107,866,195
City Direct Debt 12,418,180
Combined Total Direct and Overlapping Debt 120,284,375$
2019/20 Assessed Valuation: $3,690,121,317 After Deducting $1,120,517,266 Incremental Value.
Debt to Assess Valuation Ratios: Direct Debt 0.00%
Overlapping Debt 2.73%
Total Debt 2.73%
Source: HdL Coren & Cone
Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the city. The percentage of overlapping debt
applicable is estimated by using taxable assessed values. Applicable percentages were estimated by determining the portion of another governmental unit's
taxable assessed value that is within the city's boundaries and dividing it by each unit's total taxable assessed value.
City of Azusa
Table 17 - Direct and Overlapping Debt
June 30, 2020
2 This report reflects debt which is being repaid through voter-approved property tax indebtedness. It excludes mortgage revenue, tax allocation boncs, interim
financing obligations, non-bonded capital lease obligations, and certificates of pariticipation.
1 Debt balances are as of June 30, 2020 (most recent available) for other agency debt, and June 30, 2020 fo all City of Azusa direct debt.
190
Table 18 - Legal Debt Margin Information
Last Ten Fiscal Years
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Assessed valuation 2,252,687,451$ 2,297,922,448$ 2,459,261,962$ 2,661,768,903$ 2,865,858,608$ 3,038,069,746$ 3,249,119,133$ 3,436,345,877$ 4,810,638,583$ 5,185,972,381$
Conversion percentage 25%25%25%25%25%25%25%25%25%25%
Adjusted assessed valuation 563,171,863 574,480,612 614,815,491 665,442,226 716,464,652 759,517,437 812,279,783 859,086,469 1,202,659,646 1,296,493,095
Debt limit percentage 15%15%15%15%15%15%15%15%15%15%
Legal debt limit 84,475,779 86,172,092 92,222,324 99,816,334 107,469,698 113,927,615 121,841,967 128,862,970 180,398,947 194,473,964
Amount of debt applicable
to debt limit (1)- - - - - - - - - -
Legal debt margin 84,475,779$ 86,172,092$ 92,222,324$ 99,816,334$ 107,469,698$ 113,927,615$ 121,841,967$ 128,862,970$ 180,398,947$ 194,473,964$
For reference and comparative data FY 18/19 and FY 19/20 Area 1 was $3,489,610,718 and $3,759,639,474, respectively.
Source: City of Azusa - Finance Department
City of Azusa
(1) Total Bonded debt issued by the City, excluding certificates of participation, tax allocation bonds, special assignment bonds, revenue bonds payable from
enterprise funds, and pledge mortgage revenues and revenue bonds issued by entities other than the City of Azusa.
Fiscal Year
(2) Historically the City's Assesed valuation data consisted of Area1 only. Effective in FY18/19 measurement was changed to reflect the City Wide assessed valuation.
191
Debt Service Requirements
Fiscal Year Net Revenue
Ended Operating Operating Available for
June 30 Revenues(2)Expenses (3)Debt Service Principal Interest Total Coverage
2011 18,326,599 12,413,196 5,913,403 1,135,000 3,370,921 4,505,921 1.31
2012 20,537,532 12,835,963 7,701,569 1,180,000 3,325,671 4,505,671 1.71
2013 21,761,836 12,206,073 9,555,763 320,000 2,819,064 3,139,064 3.04
2014 22,025,412 11,743,258 10,282,154 1,000,000 2,963,039 3,963,039 2.59
2015 21,745,232 14,821,837 6,923,395 1,735,000 2,871,805 4,606,805 1.50
2016 20,906,803 13,397,044 7,509,759 1,800,000 3,133,118 4,933,118 1.52
2017 21,023,522 14,443,200 6,580,322 1,885,000 2,206,854 4,091,854 1.61
2018 22,563,500 16,466,954 6,096,546 1,940,000 2,143,553 4,083,553 1.49
2019 22,772,707 17,559,469 5,213,238 2,025,000 2,061,804 4,086,804 1.28
2020 24,896,938 18,363,855 6,533,083 2,120,000 1,969,253 4,089,253 1.60
(1)Calculation of debt coverage is in accordance with covenants set for in 2012 Series A Refunding Revenue Bonds.
(2)Includes interest revenue. Revenues restated from Fiscal Year 2012/13 CAFR to reflect calculation set forth in bond covenants.
(3)Excludes depreciation expense. Expenses restated from Fiscal Year 2012/13 CAFR to reflect calculation set forth in bond covenants.
Debt Service Requirements
Fiscal Year Net Revenue
Ended Operating Operating Available for
June 30 Revenues(2)Expenses (3)Debt Service Principal Interest Total Coverage
2011 40,332,068 35,017,007 5,315,061 480,000 468,614 948,614 5.60
2012 41,587,035 34,151,821 7,435,214 505,000 443,151 948,151 7.84
2013 42,617,624 39,000,890 3,616,734 530,000 246,108 776,108 4.66
2014 45,422,351 39,977,366 5,444,985 555,000 300,680 855,680 6.36
2015 46,566,798 39,116,215 7,450,583 585,000 254,443 839,443 8.88
2016 42,717,899 36,343,258 6,374,641 620,000 237,138 857,138 7.44
2017 41,647,888 34,475,491 7,172,397 650,000 200,974 850,974 8.43
2018 35,094,159 28,553,883 6,540,276 780,000 172,690 952,690 6.87
2019 41,668,342 29,462,841 12,205,501 795,000 150,966 945,966 12.90
2020 39,975,498 30,873,743 9,101,755 820,000 127,895 947,895 9.60
(1)Calculation of debt coverage in accordance with covenants set for in 2003 Certificates of Participation Series C and 2012 Series B
Refunding Revenue Bonds.
(2)Includes interest revenue. Revenues restated from Fiscal Year 2012/13 CAFR to reflect calculation set forth in bond covenants.
(3)Excludes depreciation expense. Expenses restated from Fiscal Year 2012/13 CAFR to reflect calculation set forth in bond covenants.
Source: City of Azusa Finance Department
CITY OF AZUSA
Table 19 - Pledged Revenue Coverage
REVENUE BONDS - WATER FUND(1)
CERTIFICATES OF PARTICIPATION AND REVENUE BONDS - ELECTRIC FUND (1)
Last Ten Fiscal Years
192
Operating Debt Service Requirements
Fiscal Year and Non- Net Revenue
Ended Gross Operating Available for
June 30 Revenues
Expenses (1)Debt Service Principal Interest Total Coverage
2011 1,672,986 1,543,754 129,232 115,000 106,313 221,313 0.58
2012 2,225,335 1,888,871 336,464 - 33,110 33,110 10.16
2013 2,500,116 4,573,251 (2,073,135)225,000 188,568 413,568 (5.01)
2014 2,577,662 2,202,296 375,366 325,000 179,595 504,595 0.74
2015 2,659,370 1,713,886 945,484 350,000 168,565 518,565 1.82
2016 2,709,754 1,437,262 1,272,492 365,000 156,833 521,833 2.44
2017 2,782,319 1,561,763 1,220,556 375,000 144,685 519,685 2.35
2018 3,056,188 1,946,750 1,109,438 385,000 132,213 517,213 2.15
2019 3,231,981 1,671,136 1,560,845 400,000 165,735 565,735 2.76
2020 3,416,110 1,979,141 1,436,969 415,000 59,253 474,253 3.03
(1)Excludes interest and depreciation expense.
Source: City of Azusa Finance Department
REVENUE BONDS - SEWER FUND
CITY OF AZUSA
Table 19 - Pledged Revenue Coverage (continued)
Last Ten Fiscal Years
193
Debt Service Requirements
Fiscal Year
Ended Tax
June 30 Increment Principal Interest Total Coverage
2011 7,910,942 1,714,212 3,179,684 4,893,896 1.62
2012 5,454,067 1,180,000 2,978,211 4,158,211 1.31
2013 4,660,561 1,235,000 3,091,833 4,326,833 1.08
2014 5,097,292 1,295,000 2,925,110 4,220,110 1.21
2015 4,817,379 730,000 3,560,840 4,290,840 1.12
2016 3,843,267 1,525,000 3,345,820 4,870,820 0.79
2017 2,229,989 1,853,012 2,024,791 3,877,803 0.58
2018 4,895,310 8,868,835 2,019,897 10,888,732 0.45
2019 5,971,272 2,002,884 1,752,794 3,755,678 1.59
2020 4,598,833 2,004,180 1,838,444 3,842,624 1.20
CITY OF AZUSA
Table 20 - Pledged Revenue Coverage
Last Ten Fiscal Years
TAX ALLOCATION BONDS - SUCCESSOR AGENCY
194
Per Capita
Calendar City County Personal Personal Unemployment
Year Population
Population (1)Income Income
Rate(1)
2010 49,207 10,441,080 871,702,000 17,715 9.6%
2011 46,618 9,889,520 854,741,000 18,335 9.3%
2012 47,586 9,958,091 882,863,000 18,553 8.3%
2013 48,385 10,017,068 847,221,000 17,510 7.4%
2014 48,405 10,053,995 845,345,000 17,464 6.2%
2015 49,485 10,116,705 861,078,000 17,400 5.0%
2016 49,762 1,015,058 907,890,000 18,244 3.9%
2017 49,864 (1)10,163,507 942,407,000 18,865 4.3%
2018 49,954 10,283,729 981,213,000 19,122 4.5%
2019 51,313 10,253,716
(2)(2)4.5%
2020 49,658 10,172,951
(2)(2)4.2%
Sources: HdL Coren & Cone, Los Angeles County Assessor
(1) U.S. Census Bureau and Bureau of Labor Statistics
(2) Data unavailable
CITY OF AZUSA
Table 21 - Demographic and Economic Statistics
Last Ten Calendar Years
195
City of Azusa
Table 22 - Principal Employers
Current Year and Seven Years Ago
Percentage Percentage
Number of of Total City Number of of Total City
Employer Employees Rank Employment Employees Rank Employment
Azusa Unified School District* 1435 1 6.32% 1580 1 8.19%
Azusa Pacific University 1265 2 5.57%
Northrop Grumman 1137 3 5.01% 978 2 5.07%
Costco Wholesale Corporation 318 4 1.40% 325 4 1.68%
Hanson Distribution Company 296 5 1.30% 135 10 0.70%
City of Azusa 274 6 1.21% 378 3 1.96%
S&S Foods LLC 220 7 0.97% 250 6 1.30%
OJ Insulation 166 8 0.73%
Alliance Environmental Group 150 9 0.66%
Buena Vista Food Products 145 10 0.64% 165 7 0.85%
Dostalek Construction Company 11 300 5 1.55%
Colorama Wholesale Nursery 12 152 8 0.79%
Target 13 141 9 0.73%
Total of Top Employers 5,406 23.81% 4,404 22.82%
Total Employees in City 22,700 (1)19,300 (2)
Sources:
2012-13 previously published CAFR
Results based on direct correspondence with city's local businesses.
*Includes all school district employees (substitutes, part-time, non-teaching, etc.)
(1) Total City Labor Force provided by EDD Labor Force Data
(2)Data not available
2019-20 2012-13
196
Table 23 - Full-time and Part-time Employees By Function
Function 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
General government 48.411 30.934 33.593 31.146 31.146 25.821 49.775 45.909 43.682 45.100
Public safety 97.395 88.750 97.570 91.750 91.750 95.200 94.500 97.500 97.500 97.800
Community development 16.196 14.197 14.651 15.533 15.533 15.462 17.462 18.460 18.152 18.160
Parks and recreation 56.557 48.023 45.407 49.317 49.317 50.260 37.127 39.990 44.405 59.346
Public works 31.115 30.058 30.265 27.181 27.181 30.259 30.233 30.260 26.072 14.340
Water 43.775 42.625 43.275 46.617 46.617 44.330 27.300 30.550 30.550 46.165
Electric 36.475 37.625 37.975 32.492 32.492 32.170 56.086 60.030 62.130 42.865
Sewer/Wastewater 10.250 10.230 9.570 7.540 7.540 8.040 7.235 7.810 8.260 7.950
Total 340.174 302.442 312.306 301.576 301.576 301.541 319.718 330.509 330.751 331.726
Source: City of Azusa Finance Department
Assigned Full-Time Equivalent (FTE) Totals
City of Azusa
Last Ten Fiscal Years
Fiscal Year
197
Table 24 - Operating Indicators by Function
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Police:
Calls for service 54,734 57,210 57,637 54,363 44,842 49,007 43,933 44,051 44,402 43,837
Parking citations issued 8,188 6,515 7,680 6,846 5,057 5,788 3,809 10,813 16,796 11,871
Public Works:
Street resurfacing (lineal miles)6.0 4.2 4.3 5.3 3.0 1.2 1.1 1.8 1.5 1.2
Parks and recreation:
Number of recreation classes 56 73 101 211 177 584 552 472 470 320
Number of facility rentals 829 868 874 809 866 933 1,223 1,215 1,085 1,007
Water:
Number of service connections (2)23,100 (2)23,104 (2)23,302 (2)23,597 (2)23,871 (2)29,934 (2)24,156 (2)24,284 (2)24,453 (2)24,123
Average daily consumption 20,230 20,819 22,179 21,974 19,438 16,958 18,077 19,441 18,116 17,556
(hundred cubic feet)
Light:
Number of service connections 15,362 (2)15,567 (2)15,749 (2)15,955 (2)16,466 (2)16,740 (2)16,555 (2)16,695 (2)16,854 (2)17,505
Average daily consumption (kWh) 654,050 648,020 677,871 685,699 705,100 695,068 701,302 692,857 680,584 664,689
Sewer:
Number of service connections (2)14,071 (2)15,235 (2)15,374 (2)15,374 (2)16,074 (2)15,968 (2)16,002 (2)16,002 (2)15,901 (2)15,669
Refuse:
Number of residential customers (2)11,123 (2)11,293 (2)11,652 (2)11,866 (2)12,128 (2)12,234 (2)12,439 (2)12,422 (2)12,580 (2)12,586
Average daily collection 177 178 179 180 185 193 187 190 202 199
(thousands of pounds)
(1)Information not available
(2)Restated number of service connections beginning in FY 2006 to number of billed accounts and accounted for customers
outside the City that are billed every 2 months.
Source: City of Azusa Police Department
City of Azusa Light & Water Department
City of Azusa Recreation Department
City of Azusa Public Works Department
CITY OF AZUSA
Last Ten Fiscal Years
Fiscal Year
198
Table 25 - Capital Asset Statistics by Function
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Police:
Stations 111111111 1
Public Works:
Streets (lineal miles) 170 174 176 177 178 178 179 179 179 179
Traffic signals 52 53 53 55 56 57 57 58 59 59
Parks and recreation:
Parks 13 15 16 17 20 21 22 22 22 22
Park acreage 61 64 64 77 84 85 87 87 87 87
Community centers 333333333 3
Water:
Water mains (miles) 315 315 315 315 315 281 281 281 281 281
Number of fire hydrant 2,600 2,810 2,815 2,820 2,820 2,444 2,444 444 444 444
Maximum daily capacity 40,000 70,500 70,500 70,500 70,500 70,500 70,500 70,500 70,500 70,500
(hundred cubic feet)
Light:
Metered Streetlights 65 65 65 65 65 64 64 64 64 64
Daily consumption (kWh) 162 162 162 162 162 164 164 164 164 164
UnMetered Streetlights 2,423 2,463 2,463 2,463 2,463
Daily consumption (kWh) 56 4,564 4,564 4,108 4,108
Sewer:
Sanitary sewers (miles) 61 80 80 80 80 80 80 80 80 80
Storm sewers (miles) 15 15 16 16 16 16 16 16 16 16
Maximum daily treatment capacity 48 48 60 60 60 60 60 60 60 60
(cubic feet per second)
Source: City of Azusa Police Department
City of Azusa Light & Water Department
City of Azusa Recreation Department
City of Azusa Public Works Department
CITY OF AZUSA
Last Ten Fiscal Years
Fiscal Year
199
Director of Finance General Overview
Finance Manager Letter of Transmittal
Management's Discussion and Analysis
Charts
General Fund
Finance Manager Overall Coordination
Senior Accountant Proprietary Funds
Non-Major Proprietary Funds
Capital Projects
Fixed Assets Accounting
Senior Accountant Non-Major Governmental Funds
Internal Service Funds
Grants Funds (Single Audit)
Successor Agency
Finance Manager Statistical Section
Budget Administrator
Payroll Specialist
CITY OF AZUSA
Table 26 - Schedule of Credits
Fiscal Year 2019/20
Also, a special thank you to all the Finance Department Staff: Kristina Pascarella, Dave Nguyen,
Henry Quintero, Richard Lam, Jesus Jaimes, Ruby Toledo, Gilberto Juarez, Merci Rodriguez, Adriana
Garcia, and Charles Alvarez who also played roles in the collection of data and completion of the
fiscal year 2019/20 CAFR.
200