CAFR FY 2011-121
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COMPREHENSIVE
ANNUAL FINANCIAL REPORT
FISCAL YEAR ENDED
JUNE 30, 2012
CITY OF RANCHO PALOS VERDES,
CALIFORNIA
COMPREHENSIVE
ANNUAL FINANCIAL REPORT
For the Year Ended June 30, 2012
Prepared By:
Finance & Information Technology Department
Dennis McLean, Director
Kathryn Downs, Deputy Director
INTRODUCTORY SECTION
Breakfast with Santa
CITY OF RANCHO PALOS VERDES
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED JUNE 30, 2012
TABLE OF CONTENTS
INTRODUCTORY SECTION:
Table of Contents i -iii
Letter of Transmittal iv -ix
Directory of City Officials x
Organization Chart xi
GFOA Certificate of Achievement for Excellence in Financial Reporting xii
FINANCIAL SECTION:
Independent Auditor's Report 3
Management Discussion and Analysis 7
Government -Wide Financial Statements
Statement of Net Assets 21
Statement of Activities 22
Fund Financial Statements
Governmental Funds
Balance Sheet 26
Reconciliation of the Balance Sheet of Governmental Funds
to the Statement of Net Assets 29
Statement of Revenues, Expenditures, and Changes in Fund Balances 30
Reconciliation of the Statement of Revenues, Expenditures, and Changes
in Fund Balances to the Statement of Activities 32
General Fund
Statement of Revenues, Expenditures, and Changes in Fund Balance
- Budget and Actual 33
Street Maintenance Special Revenue Fund
Statement of Revenues, Expenditures, and Change in Fund Balance
- Budget and Actual 35
Affordable Housing Special Revenue Fund
Statement of Revenues, Expenditures, and Change in Fund Balance
- Budget and Actual 36
Proprietary Funds
Statement of Net Assets 37
Statement of Revenues, Expenses, and Changes in Fund Net Assets 38
Statement of Cash Flows 39
Fiduciary Funds
Statement of Fiduciary Net Assets 40
Statement of Changes in Fiduciary Net Assets 41
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CITY OF RANCHO PALOS VERDES
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED JUNE 30, 2012
TABLE OF CONTENTS
Notes to the Financial Statements 44
Supplementary Information
Major Fund Budgetary Comparison Schedules
Schedule of Revenues, Expenditures, and Changes in Fund Balances
- Budget and Actual
Capital Improvements Capital Projects Fund
80
Non -Major Governmental Funds
Combining Balance Sheet 84
Combining Statement of Revenues, Expenditures, and Changes
in Fund Balances 90
Schedule of Revenues, Expenditures, and Changes in Fund Balances
- Budget and Actual — Special Revenue Funds
Air Quality Management Fund 96
Community Development Block Grant Fund 97
El Prado Fund 98
RDA Housing Set -Aside 99
Proposition A Fund 100
Proposition C Fund 101
Measure R 102
Beautification Fund 103
Waste Reduction Fund 104
Public Safety Grants Fund 105
1972 Act Fund 106
1911 Act Fund 107
JPIA — Portuguese Bend Fund 108
Habitat Restoration Fund 109
Measure A Fund 110
Abalone Cove Sewer Assessment District 111
Dr. Allen and Charlotte Ginsburg Cultural Arts Building 112
Donor Restricted Contributions 113
Bikeways Fund 114
Environmental Excise Tax Fund 115
Quimby Fund 116
Schedule of Revenues, Expenditures, and Changes in Fund Balances
- Budget and Actual — Debt Service Funds
RDA Debt Service Fund 117
Schedule of Revenues, Expenditures, and Changes in Fund Balances
- Budget and Actual — Capital Projects Funds
RDA Abalone Cove Fund
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118
CITY OF RANCHO PALOS VERDES
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED JUNE 30, 2012
TABLE OF CONTENTS
RDA Portuguese Bend Fund 119
Schedule of Revenues, Expenditures, and Changes in Fund Balance
- Budget and Actual — Permanent Fund
Subregion One Maintenance Fund 120
JPIA — Abalone Cove Fund 121
Internal Service Funds
Combining Statement of Net Assets 124
Combining Statement of Revenues, Expenses, and Changes
in Fund Net Assets 125
Combining Statement of Cash Flows 126
STATISTICAL SECTION (Unaudited)
Financial Trends
Net Assets by Component 130
Changes in Net Assets 131
Governmental Activities Tax Revenue By Source 133
Fund Balances of Governmental Funds — Before GASB 54 134
Fund Balances of Governmental Funds — After GASB 54 135
Changes in Fund Balances of Governmental Funds 136
General Governmental Tax Revenues By Source 137
Revenue Capacity
Assessed Value and Estimated Actual Value of Taxable Property 138
Property Tax Rates - Direct and Overlapping Governments 139
Principal Property Tax Payers 140
Property Tax Levies and Collections 141
Debt Capacity
Ratios of Outstanding Debt by Type 142
Direct and Overlapping Governmental Activities Debt 143
Legal Debt Margin Information 144
Demographic and Economic Information
Demographic and Economic Statistics 145
Principal Sales Tax Payers 146
Principal Employers 147
Operating Information
Full-time Equivalent City Government Employees by Function 148
Operating Indicators by Function 149
Capital Asset Statistics by Function 150
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Cub Scout City Hall Tour
CITY O RANCHO PALOS VERDES
February 7, 2013
Honorable Mayor and City Council
City of Rancho Palos Verdes
Rancho Palos Verdes, California
The Comprehensive Annual Financial Report (CAFR) of the City of Rancho Palos Verdes for the fiscal year ended
June 30, 2012, is hereby submitted as mandated by both local ordinances and state statutes. These ordinances and
statutes require that the City of Rancho Palos Verdes issue annually a report on its financial position and activity, and
that an independent firm of certified public accountants audit this report. Responsibility for both the accuracy of the
data, and the completeness and fairness of the presentation, including all disclosures, rests with the City. To the best
of our knowledge and belief, the enclosed data is accurate in all material respects and is reported in a manner that
presents fairly the financial position and results of operations of the various funds and component unit of the City of
Rancho Palos Verdes. In addition, to the best of our knowledge, there are no untrue statements of material fact
within the financial statements or omissions of material fact to cause the financial statements to be misleading. All
disclosures necessary to enable the reader to gain an understanding of the City's financial activities have been
included.
The financial section of the CAFR includes management's discussion and analysis (MD&A) of the financial activity.
This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it.
The financial reporting entity (the government) includes all the funds of the primary government (i.e., the City of
Rancho Palos Verdes as legally defined), as well as its component unit, the Rancho Palos Verdes Joint Powers
Improvement Authority. A component unit is a legally separate entity for which the primary government is financially
accountable. The City provides a broad range of services, including police protection, solid waste collection,
construction and maintenance of streets and other infrastructure, planning and zoning activities, recreational
activities, cultural events, and general administrative services. The City of Rancho Palos Verdes is a contract city,
meaning that some of these services are provided by contract with other agencies (both public and private) and some
services are delivered by the City's own employees.
Special districts of the County of Los Angeles provide library services, fire protection services, and sewer services.
The City has excluded the County of Los Angeles, as well as the State of California and various school districts, from
the financial reporting entity because they do not meet the established criteria for inclusion.
GOVERNMENTAL STRUCTURE
The City of Rancho Palos Verdes is located on a coastal peninsula overlooking the Pacific Ocean in Los Angeles
County, 20 miles south of the City of Los Angeles. The City was incorporated September 7, 1973. The City currently
has a land area of 13.6 square miles and a population of about 42,000. The City is primarily a "bedroom" community
with relatively little commercial activity.
The City has operated under the council-manager form of government since incorporation. Policy-making and
legislative authority are vested in the governing council, which consists of five council members, including the mayor
and mayor pro -tem. The governing council is responsible, among other things, for passing ordinances, adopting the
budget, appointing committees and hiring the city manager and the city attorney. The city manager is responsible for
carrying out the policies and ordinances of the governing council, for overseeing the day-to-day operations of the
government, and for appointing the heads of the government's departments. The council is elected on a non-
partisan, at -large basis. Council members are elected to four-year staggered terms with two or three council
members elected every two years. The council designates the mayor and mayor pro -tem for a one-year term.
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MAJOR INITIATIVES
The City's staff, following specific directives of the City Council and the City Manager, has been involved in a variety
of projects throughout the year. These projects reflect the government's commitment to ensuring that its citizens are
able to live and work in an enviable environment.
Community Development
The City together with the Palos Verdes Peninsula Land Conservancy continued management of the City's
Natural Communities Conservation Plan (NCCP) Preserve, including obtaining City Council approval of Final
Preserve Trails Plan for the entire Preserve, continuing several on-going habitat restoration projects, and several
trail maintenance and improvement projects.
Continued to approve the installation of various commercial antenna facilities for cellular telephones and
personal communication systems on private property throughout the City.
Continued to take steps to update the City's General Plan by obtaining Planning Commission approval of the
draft text for each of the General Plan Elements. Staff is currently presenting Draft General Plan Land Use Map
Changes to the Planning Commission for review and approval. Staff anticipates that the Planning Commission
will complete their review and recommend a draft of the General Plan Update to the City Council in early 2013.
Staff also anticipates that the City Council will adopt the Updated General Plan in summer 2013.
Continued to ensure that the various housing programs within the Housing Element are being implemented.
Additionally, staff has released an RFP with the intent to secure a Housing Consultant to assist Staff in preparing
the next mandatory Housing Element Update, which is due to the State Department of Housing and Community
Development in October 2013.
Implemented the approved Vision Plan, a coordinated master plan consisting of program, design and linkage
concepts for land located within the coastal region of the City, with a) a $500,000 grant from the California
Coastal Conservancy to complete the RPV portion of the California Coastal Trail; and b) with a $332,588
matching grant by the State Recreation and Parks Land and Water Conservation Fund for the Abalone Cove
Shoreline Park Improvement project.
Implemented the City's Trails Network Plan by improving and maintaining trails within the Palos Verdes Nature
Preserve pursuant to the Council adopted Preserve Trails Plan, and obtained access easements as part of
private development projects for the construction of the Bronco Trail and the Salvation Army Trail as identified in
the City's Conceptual Trails Plan. Pursuant to a grant from the California Coastal Conservancy, the City has
prepared plans and will begin construction on the City's segment of the California Coastal Trail. Lastly, the City
will begin an extensive overhaul of the Trails Network Plan for trails outside of the Preserve in fall 2012. Public
outreach will be included.
Prepared a Draft EIR for the Zone 2 Landslide Moratorium Ordinance Revisions. The Landslide Moratorium
Ordinance currently includes an exception category for the 16 Monks plaintiffs' lots, which grants them the ability
to apply for Landslide Moratorium Exceptions (LMEs) to develop new homes on their lots. The Zone 2 Landslide
Moratorium Ordinance Revisions will expand the exception category to allow the remaining 31 vacant, non -
Monks lots in Zone 2 to also apply for LMEs.
Took initial steps towards the creation of a Western Avenue Vision Plan by selecting a consultant, and identifying
a work product that will serve as a visionary framework plan for a 2 -mile stretch of Western Avenue. The Vision
Plan is a multi -faceted project that will develop a corridor strategy that will help revitalize and redefine the identity
of the Western Avenue corridor through aesthetic improvements, transit improvements and business incentives.
Public Works
Awarded $9.4M grant from California Department of Water Resources to construct the San Ramon Canyon
project; which is necessary to reduce erosion in the Canyon, control the undermining of the Palos Verdes Drive
East switchbacks, reduce flooding at Palos Verdes Drive South / 25th Street and protect a 200 home mobile
home community against flooding.
Completed emergency relocation of sanitary sewer collection system adjacent to San Ramon Canyon, which was
necessary to alleviate risk of system failure due to the steady erosion of canyon walls in the direction of a buried
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pipeline.
Awarded $130K grant for retrofitting storm drain catch basins to comply with water quality regulations mandating
the elimination of trash deposits into Machado Lake.
Completed construction of Via Canada Storm Drain Improvements Project which was necessary to eliminate
flooding of homes on the Via Canada cul-de-sac due to undersized inlets.
Completed design of Miraleste Plaza Storm Drain Improvements Project which is necessary to replace some of
the oldest storm drains in the City with pipes designed and installed to City standards.
Completed design of 2012 Storm Drain Lining and Rehabilitation Project which will mitigate the risk of failure of
corrugated metal pipes on the city's east side due to corrosion, soil piping and subsurface erosion. This
trenchless technology will extend the life of existing pipes another 25 to 30 years without expensive and
disruptive street trenching.
Completed construction of the Palos Verdes Drive South Landslide Drainage Grading Project which rehabilitated
an existing storm drain line that transports drainage runoff from a section of Palos Verdes Drive South in the
Portuguese Bend Landslide area to the ocean.
Completed resurfacing of various residential roadways in Zones 4 & 8 of the City. Improvements included cape
seal, slurry seal, asphalt concrete, new and modified access ramps, and roadway signing and striping.
Established a Neighborhood Permit Parking program in the Peninsula Verde Neighborhood.
Initiated the FY 11-12 Annual Sidewalk Repair Program.
Initiated and completed the Crenshaw at Crestridge Traffic Signal Upgrade Project.
Completed design and construction of ADA improvements in the Vista Grande area.
Completed 75% design for Ryan Park Southern Entrance Improvements and Parking Lot Expansion project to
comply with the American with Disabilities Act, which will increase parking on site and improve safety for park
users.
Completed design for Ryan Park Restrooms Improvements & Accessibility Compliance Project.
RPV California Coastal Trail (CCT) project is ready for award for construction. This project is mostly funded by a
Prop 84 grant.
Completed Construction for Eastview Park Playground and Accessibility Improvements project.
Completed Hesse Park and City Hall Community Room drop ceiling retrofit projects for earthquake safety.
Held the City's first free document shredding events offered to RPV residents. A total of 760 vehicles brought
16.88 tons of material for shredding.
Parks and Recreation
Coordinated numerous annual special events and recreational opportunities for the community. Annual events
included the Whale of a Day Celebration, Egg Hunt Eggstravaganza, July 4th Independence Day Celebration,
Shakespeare by the Sea performance, International Coastal Cleanup Day, and Breakfast with Santa fundraiser.
Recreational opportunities included the Paddle Tennis Tournament, Night at the Museum, and a new co-ed Adult
Softball League.
Partnered with various organizations and agencies to offer services and programs to the community. The City
partnered with:
• Palos Verdes Peninsula Unified School District to offer a week-long Writing by the Sea program for
local students;
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• Palos Verdes Library District to offer monthly Little Critter Afternoon Tales story time fun for
youngsters at Hesse Park;
• City of Los Angeles to offer monthly pet adoption events;
• County of Los Angeles and Society of California Veterinary Vaccine Care to offer low-cost pet
vaccination and microchip services; and
• Los Angeles Girl Scouts to create a new Night at the Museum Program centering on satisfying
badge requirements.
Coordinated approximately 70 onsite and offsite recreation activities for REACH, the City's therapeutic program
serving young adults with developmental disabilities.
Coordinated public and private rentals and activities at various City facilities. These included community and
private classes and parties, youth athletic league activities, film shoots, and non-profit events.
Extended a contract with Trump National Golf Club for private rentals at Founders Park.
Continued to provide oversight, support, and coordination of opportunities and programs with the Los Serenos de
Point Vicente docent organization, including expanded public and private hikes and speaking engagements, and
a new Fourth Grade Tour Program coordinated with the Palos Verdes Peninsula Unified School District.
Completed a new exhibit at the Point Vicente Interpretive Center: Serena the Gray Whale, a 22 -foot articulated
skeleton of a juvenile Pacific gray whale.
Provided enforcement and public education in the Palos Verdes Nature Preserve through a contract with the
Mountains Recreation & Conservation Authority for ranger services, and provided interpretive activities including
a Junior Ranger Program, Junior Ranger Summer Camp, ranger -led night hikes, and public appearances and
talks.
Implemented a 24/7 Ranger Hotline for public reporting of misuse of the Palos Verdes Nature Preserve.
Pursued donations through the City's Gifts for Parks program to assist with Recreation and Parks facilities,
operations, and special events; including the Fourth of July Celebration, REACH program for young adults with
developmental disabilities, and Point Vicente Interpretive Center exhibits and programs.
Implemented a policy for the display of temporary banners promoting City -sponsored and co-sponsored events
and recreational opportunities. The policy improves the uniformity and appearance of the banners displayed at
City park sites.
Following the acquisition of the approximately five -acre Rancho Palos Verdes Beach, coordinated a program of
public education, signage, and enforcement of City ordinances for appropriate use of the beach.
Administration
RPVTV continued to expand programming offered on the City's cable channel, RPVTV, including rebroadcasts of
the City Council and Planning Commission meetings, productions of a wide variety of local interest programming
and offering a Video Bulletin Board featuring local community events.
Continued to work with a consultant to pursue promising grant opportunities for a variety of City projects,
including public infrastructure and parks and open space. As of June 30, 2012, the City had received a total of
$9,899,558 in competitive grant awards.
Conducted an Emergency Preparedness Drill in October 2011 in conjunction with the statewide "Great California
Shake Out" and was successful in obtaining a $24,000 grant to update the City's 2004 Joint Hazard Mitigation
Plan.
Supported City Council development of positions and consensus on the annual League of California Cities
Conference resolutions, which were voted on by the City Council's voting delegate at the 2011 Conference in
San Francisco in September 2011.
Supported City Council development and review of City Council Rules of Procedure and City Council,
Commission and Committee Protocol, which were adopted in May 2012.
vii
Continued to prepare and distribute the City's quarterly newsletter—mailed to individual households and posted
on the City's website—to keep residents apprised of important City news, information and events.
Continued to lead a regional response to an FAA proposal to change an airspace classification which would likely
have had a negative impact on safety and the environment. Staff also continued to address issues with Torrance
Airport helicopter routes, worked closely with the FAA to reduce the impact of Peninsula over -flights, and actively
participated in the LAX Community Noise Roundtable to ensure protection of our residents.
Assumed responsibility for the bi-monthly Border Issues Status Report from the Community Development
Department, and continued to monitor a wide range of development proposals in surrounding cities to assess
their potential effects upon Rancho Palos Verdes residents.
Worked to quickly fill an unexpected vacancy in the City's Human Resources Manager position with an
experienced contract employee in order to maintain a high level of customer service to the City's employees.
Began negotiations leading to the development of a Memorandum of Understanding (MOU) with the Rancho
Palos Verdes Employees' Association.
The Finance and Information Technology Department completed a Request for Proposal (RFP) process for the
procurement of a Citywide Enterprise Resource Planning (ERP) system. The City is currently in contract
negotiations and anticipates proposing a contract to the City Council by the end of 2012.
A reorganization of the City's website was completed during 2012 to improve accessibility and organization for
both residents and businesses.
City Staff developed analysis and design of pension reform enacted by the City Council effective September 23,
2011, which maximized employee contributions to pension costs and added a second tier of reduced benefits for
new employees.
Finance and Information Technology Staff successfully managed dissolution of the Redevelopment Agency,
transition to the Successor Agency, and support of the new Oversight Board for the Successor Agency. The
winding down of the former Redevelopment Agency consumes about 1/3 of a full-time employee and is expected
to have a 2-3 year duration.
Developed and substantially completed a major information technology upgrade that includes a new virtualized
server and file storage network, implementation of a Microsoft enterprise -wise licensing arrangement for servers
and desktops, and replacement of about 60 desktop computers.
FINANCIAL INFORMATION
Internal Control. The Finance and Information Technology department of the City is responsible for establishing and
maintaining an appropriate internal control structure. The internal control system is designed to ensure that the
assets of the City are protected from loss, theft, or misuse and to ensure that adequate accounting data is compiled
to allow for the preparation of financial statements in conformity with GenerallyAccepted Accounting Principles. The
internal control structure is designed to provide reasonable, but not absolute, assurance that these objectives are
met. The concept of reasonable assurance recognizes that: (1) the cost of a control should not exceed the benefits
likely to be derived; and (2) the valuation of costs and benefits requires estimates and judgements by management.
Budgeting Controls. The City of Rancho Palos Verdes maintains budgetary controls. The objective of these
budgetary controls is to ensure compliance with legal provisions contained in the annual appropriated budgets
approved by the City Council, Redevelopment Agency Board, and Improvement Authority Commission. Activities of
the General fund, Special Revenue funds, Capital Projects funds, Debt Service fund and Permanent funds are
included in the annual appropriated budgets of the government units. The level of budgetary control (that is, the level
at which expenditures cannot legally exceed the appropriated amount) is established at the department/function level
within each fund. Formal budgetary integration is employed as a management control device. The City also
maintains an encumbrance accounting system as one method of maintaining budgetary control. These encumbrances
lapse at year-end, and any unexpended balance is eligible to be carried over to the following year's budget
appropriations with City Council approval.
viii
Budget to Actual Comparison. The City experienced an overall $1.1 million favorable budget variance in the General
fund for the fiscal year ended June 30, 2012. Favorable expenditure variances across most all 30 programs of the
General Fund were the drivers of the overall favorable variance. Many of the favorable expenditure variances were
permanent savings resulting from conservative budget practices and the continued careful management of resources
during fiscal year 2011-12.
Significant Financial Events. The former Redevelopment Agency was dissolved as of February 1, 2012, and the
assets and liabilities were transferred to the Successor Agency. There were no other changes to financial policies
that resulted in a significant impact on the June 30, 2012 financial statements.
OTHER INFORMATION
Independent Audit. The City requires an annual audit by independent certified public accountants. The accounting
firm of White Nelson Diehl Evans LLP conducted this year's audit. The auditors' report on the government -wide
financial statements and combining and individual fund statements and schedules is included in the financial section
of this report.
Single Audit. As a recipient of federal, state, and county financial assistance, the City is responsible for ensuring that
an adequate internal control structure is in place to ensure compliance with applicable laws and regulations related to
those programs. This internal control structure is subject to periodic evaluation by management. In years when over
$500,000 is expended on Federal financial assistance programs, the City is required to undergo an annual single
audit in conformity with the provisions of the Single Audit Act of 1984 and U.S. Office of Management and Budget
Circular A-133, Audits of States, Local Governments, and Non -Profit Organizations. For the year ended June 30,
2012, $318,798 was expended on Federal financial assistance programs; and therefore a Single Audit is not required.
GFOA Certificate of Achievement Award. The Government Finance Officer's Association of the United States and
Canada (GFOA) oversees a prestigious national award program to recognize conformance with the highest
standards of report preparation. In order to be awarded a Certificate of Achievement, a government unit must publish
an easily readable and efficiently organized CAFR. This report must satisfy both Generally Accepted Accounting
Principles and applicable legal requirements.
The GFOA awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Rancho Palos
Verdes for its CAFR for the fiscal year ended June 30, 2011. This was the 19th consecutive year that the City of
Rancho Palos Verdes has achieved this prestigious award. A copy of the GFOA Certificate of Achievement is
included later in the introductory section of this year's CAFR. A Certificate of Achievement is valid for a period of one
year only. We believe our current CAFR continues to meet the Certificate of Achievement Program's requirements
and we are submitting it to the GFOA to determine its eligibility for another certificate.
Acknowledgments. Completion of this report was the accomplishment by combined efforts of many individuals,
especially Linda Gan-Vanderlinde, Senior Accountant, and Kathryn Downs, Deputy Director of Finance and
Information Technology, who coordinated preparation of the report. I wish to acknowledge the assistance of our
auditors, White Nelson Diehl Evans LLP and the contributions of other Finance and Information Technology
Department staff: Ryan Mills, Matt Waters, Jane Lin, Selena Wright, Gayle Vanoverbeck, and Jayne Mahtani.
I would also like to recognize the City Council for their continued leadership directing the City to achieve a sound
fiscal position over the last several years. We look forward to maintaining this success in the future under the
leadership of the City Council.
Respectfully submitted,
Dennis McLean
Director of Finance & Information Technology
ix
CITY OF RANCHO PALOS VERDES
DIRECTORY OF CITY OFFICIALS
JUNE 30, 2012
CITY COUNCIL
Anthony M. Misetich, Mayor
Brian Campbell, Mayor Pro -Tem
Susan Brooks, Councilman
Jerry V. Duhovic, Councilman
James E. Knight, Councilman
ADMINISTRATION AND DEPARTMENT HEADS
City Manager Carolyn Lehr
Deputy City Manager Carolynn Petru
City Clerk Carla Morreale
Director of Finance and Information Technology Dennis McLean
Community Development Director Joel Rojas
Director of Public Works Tom Odom
Interim Director of Recreation and Parks Carolynn Petru
City Attorney Richards, Watson & Gershon
x
CITY OF RANCHO PALOS VERDES
ORGANIZATIONAL CHART
CITIZENS OF
RANCHO PALOS VERDES
MAYOR AND CITY COUNCIL
COMMISSIONS & COMMITTEES
Planning Commission
Traffic Safety Commission
Finance Advisory Committee
CITY MANAGER
Administration
Personnel/Community Outreach
Risk Management
CITY CLERK
Records Management
Public Information
Elections
RECREATION & PARKS
Park Facilities Staffing
Point Vicente Interpretive Center
Special Events
REACH Program
PUBLIC SAFETY
L.A. County Sheriff
L.A. County Fire
Animal Control
Emergency Preparedness
FINANCE & INFORMATION
TECHNOLOGY
Financial Reporting & Budget
Accounts Payable/Receivable
Payroll
Purchasing
Information Technology
COMMUNITY DEVELOPMENT
Planning/Zoning
Building & Safety/Geology
Code Enforcement
View Restoration
PUBLIC WORKS
Street Maintenance
Refuse/City Engineering
Park/Building Maintenance
Capital Projects
xi
COMMISSIONS & COMMITTEES
Emergency Preparedness Committee
Oversight Committee for the Water Quality & Flood
Protection Program
CITY ATTORNEY
Richards, Watson & Gershon
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Rancho Palos Verdes
California
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
June 30, 2011
A Certificate of Achievement for Excellence in Financial
Reporting is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and financial reporting.
Executive Director
xii
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FINANCIAL SECTION
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Certified Public Accountants sulxants
INDEPENDENT AUDITORS' REPORT
The Honorable Mayor and
Members of the City Council of
the City of Rancho Palos Verdes
Rancho Palos Verdes, California
We have audited the accompanying financial statements of the governmental activities, the
business -type activity, each major fund, and the aggregate remaining fund information of the City of
Rancho Palos Verdes, California, (the City) as of and for the year ended June 30, 2012, which
collectively comprise the City's basic financial statements as listed in the table of contents. These
financial statements are the responsibility of the City of Rancho Palos Verdes' management. 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 of material misstatement. An audit includes consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for
the purpose of expressing an opinion on the effectiveness of the City's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements, assessing the accounting
principles used and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a reasonable basis for our
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 activity, each major fund,
and the aggregate remaining fund information of the City of Rancho Palos Verdes, California, as of
June 30, 2012, and the respective changes in financial position and cash flows, where applicable,
thereof and the respective budgetary comparisons for the General, Street Maintenance Special Revenue
and Affordable Housing Special Revenue major governmental funds for the year then ended in
conformity with accounting principles generally accepted in the United States of America.
As discussed in Note 14 to the basic financial statements, the Rancho Palos Verdes Redevelopment
Agency, a blended component unit of the City, was dissolved effective February 1, 2012 as a result of
legislation enacted by the State of California.
2875 Michelle Drive, Suite 300, Irvine, CA 92606 • Tel: 714.978.1300 • Fax: 714.978.7893
Offices located in Orange3and San Diego Counties
In accordance with Government Auditing Standards, we have also issued our report dated
February 7, 2013, on our consideration of the City of Rancho Palos Verdes' internal control over
financial reporting and 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 the internal control over financial reporting or on compliance. That
report is an integral part of an audit performed in accordance with Government Auditing Standards and
should be considered in assessing the results of our audit.
The management's discussion and analysis, identified as required supplementary information in the
table of contents, is not a required part of the basic financial statements but is supplementary
information required by the accounting principles generally accepted in the United States of America.
This information is 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 management's discussion and analysis 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 the
audit of the basic financial statements. We do not express an opinion or provide any assurance on the
management's discussion and analysis because the limited procedures do not provide us with sufficient
evidence to express an opinion or provide any assurance.
Our audit was made for the purpose of forming opinions on the financial statements that collectively
comprise the City's basic financial statements as a whole. The combining statements and individual
fund schedules are presented for purposes of additional analysis and are not a required part of the basic
financial statements of the City. Such information is the responsibility of management and was
derived from and relates directly to the underlying accounting and other records used to prepare the
financial statements. The information has been subjected to the auditing procedures applied in 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 financial statements themselves, and other additional procedures
in accordance with auditing standards generally accepted in the United States of America. In our
opinion, the information is fairly stated in all material respects in relation to the basic financial
statements taken as a whole.
Our audit was conducted for the purpose of forming opinions on the basic financial statements of the
City of Rancho Palos Verdes, California as a whole. The introductory section and statistical section
are presented for purposes of additional analysis and are not a required part of the basic financial
statements. Such information has 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.
l/f
Irvine, California
February 7, 2013
4
MANAGEMENT'S DISCUSSION & ANALYSIS
5
1
111
Leans No Trace Principle;
Junior Ranger Graduation
6
CITY OF RANCHO PALOS VERDES
MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2012
The Management of the City of Rancho Palos Verdes offers readers of the City
of Rancho Palos Verdes' Financial Statements this narrative overview and
analysis of the City's financial activities for the Fiscal Year ended June 30, 2012.
We encourage readers to consider the information presented here in conjunction
with additional information that we have furnished in our Letter of Transmittal,
which can be found on pages iv -ix of this report.
Financial Highlights
➢ The assets of the City of Rancho Palos Verdes exceed its liabilities at the
close of the Fiscal Year ended June 30, 2012, by $200,238,415 (Net
Assets). Of this amount, $70,643,725 (Unrestricted Net Assets) may be
used to meet the City's ongoing obligations to its citizens and creditors.
The remaining amount is invested in capital assets or is otherwise
nonexpendable, and is therefore not available to meet the City's
obligations.
➢ The City's Total Net Assets increased by $28,159,346. There is no trend
for annual increases or decreases of Total Net Assets. Each year's
change is generally related to significant one-time events. The same is
true for FY11-12. The State of California enacted law to dissolve
redevelopment agencies effective January 31, 2012. As a result of the
Rancho Palos Verdes Redevelopment Agency (RDA) dissolution, the
former RDA is no longer a component unit of the City. Therefore, the
City's consolidated loan receivable of $19.3 million from the former RDA is
now reported on the Statement of Net Assets, and the former RDA debt to
the County of $5.5 million is no longer reported on the Statement of Net
Assets for a combined impact of about $24.8 million. Additional
information on the City's dissolution of Redevelopment Agency can be
found in Note # 14 on pages 70-77 of this report. In addition, transient
occupancy tax of about $3.2 million was added to the Reserve for Future
Capital Projects instead of being spent during FY11-12.
➢ As of June 30, 2012, the City's Governmental Funds reported combined
ending Fund Balances of $48,485,062, an increase of $22 million. Once
again there is no trend for annual increases and decreases of
governmental fund balances, and changes are generally attributable to
significant one-time events. As of June 30, 2011, the Balance Sheet —
Governmental Funds included funds of the former RDA and the
consolidated loan payable to the City. The funds of the former RDA have
been closed and that debt is no longer reflected on the Balance Sheet —
Governmental Funds. And as mentioned above, the Reserve for Future
Capital Projects increased by about $3.2 million.
See independent auditors' report.
7
CITY OF RANCHO PALOS VERDES
MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2012
➢ As of June 30, 2012, unassigned fund balance for the General Fund was
$12,464,439 or 71 % of General Fund expenditures. About $11.8 million of
this amount constitutes the City Council's General Fund Reserve (rainy
day fund). Due to the City Council's reserve policy, the unassigned fund
balance has historically been maintained at or above the policy threshold
level of 50% of budgeted General Fund expenditures.
➢ As noted above, due to redevelopment dissolution, the former RDA is no
longer a component unit of the City; and therefore, the City's total debt
decreased by nearly $6 million.
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 Financial Statements. This report also contains other
supplementary information in addition to the basic financial statements
themselves.
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.
The Statement of Net Assets presents information on all of the City's assets and
liabilities, with the difference between the two reported as Net Assets. Over time,
increases or decreases in net assets may serve as a useful indicator of whether
the financial position of the City of Rancho Palos Verdes is improving or
deteriorating.
The Statement of Activities presents information showing how the government's
net assets changed during the most recent Fiscal Year. All changes in net
assets 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 the Government -Wide Financial Statements distinguish functions of the City
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, public works, planning, building and safety, and recreation. The
City's business -type activities include only the Water Quality and Flood
See independent auditors' report.
8
CITY OF RANCHO PALOS VERDES
MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2012
Protection program for renewal and maintenance of the City's storm drain
facilities.
The Government -Wide Financial Statements include not only the City of Rancho
Palos Verdes itself (known as the Primary Government), but also a legally
separate Improvement Authority for which the City of Rancho Palos Verdes is
financially accountable. Financial information for this Component Unit has been
included as an integral part of the primary government.
The Government -Wide Financial Statements can be found on pages 21-23 of this
report.
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 Rancho Palos Verdes, 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. The Governmental 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.
The City of Rancho Palos Verdes maintained 30 individual Governmental Funds
during the Fiscal Year ended June 30, 2012. Information is presented separately
in the Governmental Fund Balance Sheet and in the Governmental Fund
Statement of Revenues, Expenditures, and Changes in Fund Balances for the
General Fund, the Street Maintenance Fund, the Affordable Housing Fund and
the Capital Improvements Fund, all of which are considered to be major funds.
Data from the other 26 Governmental Funds are combined into a single,
See independent auditors' report.
9
CITY OF RANCHO PALOS VERDES
MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2012
aggregated presentation. Individual fund data for each of these Other
Governmental Funds is provided in the form of combining statements elsewhere
in this report.
The City of Rancho Palos Verdes adopts an annual appropriated budget for each
of its Governmental Funds. A budgetary comparison statement has been
provided for each Governmental Fund to demonstrate compliance with this
budget.
The basic Governmental Fund Financial Statements can be found on pages 26-
36 of this report.
Proprietary Funds. The City of Rancho Palos Verdes maintains two types of
Proprietary 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 Quality
and Flood Protection Program. Internal Service Funds are an accounting device
used to accumulate and allocate costs internally among the City's various
functions. The City uses Internal Service Funds to account for its fleet of
vehicles, computer systems, furniture and equipment, Employee Benefits, and
Civic Center building replacement/improvements. Because these services
predominantly benefit the governmental function, they have been included within
governmental activities in the Government -Wide Financial Statements.
Proprietary Fund Financial Statements provide the same type of information as
the Government -Wide Financial Statements, only in more detail. These
statements can be found on pages 37-39 of this report. The Proprietary Fund
Financial Statements provide separate information for the Enterprise Fund and
the Internal Service Funds. The Enterprise Fund is presented as a single major
fund of the City, while the Internal Service Funds are combined and presented as
a single, aggregated presentation in the Statement. Individual fund data for the
Internal Service Funds is provided in the form of combining statements
elsewhere in this report.
Fiduciary Fund. The City is a fiduciary for the Successor Agency to the Rancho
Palos Verdes Redevelopment Agency (the "Successor Agency"). The City is
responsible for ensuring that the assets reported in the Successor Agency's
private -purpose trust fund are only: 1) used to extinguish the obligations of the
former RDA; or 2) transferred to another agency pursuant to state redevelopment
dissolution law. All of the fiduciary activities are reported in a separate Statement
of Fiduciary Net Assets and Statement of Changes in Fiduciary Net Assets. We
exclude these activities from the City's Government -Wide Financial Statement
because the City cannot use these assets to finance its operations.
See independent auditors' report.
10
CITY OF RANCHO PALOS VERDES
MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2012
Notes to the 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. The notes to the financial statements can
be found on pages 44-78 of this report.
Other information. The combining statements referred to earlier in connection
with Other Governmental Funds and Internal Service Funds are presented
immediately following the Notes to the Financial Statements. Combining and
individual fund statements and schedules can be found on pages 80-126 of this
report.
Government -wide Financial Analysis
As noted earlier, net assets may serve over time as a useful indicator of a
government's financial position. In the case of the City of Rancho Palos Verdes,
assets exceeded liabilities by $200,238,415 at June 30, 2012. By far, the largest
portion of the City's Net Assets (64%) reflects its investment in Capital Assets
(e.g. Land, Infrastructure, Buildings, and Equipment). The City uses these
Capital Assets to provide services to its citizens; consequently, these assets are
not available for future spending.
City of Rancho Palos Verdes Net Assets
Invested in capital assets
Restricted
Unrestricted
Total net assets
I$
114,488,431
1,750,000
67,112,110
183,350,541
115,145,081 13,356,259 12,752,669 127,844,690 127,897,750
1,750,000 1,750,000 1,750,000
39,065,703 3,531,615 3,365,616 70,643,725 42,431,319
$ 155,960,784 1 $ 16,887,874 1 $ 16,118,285 1 $ 200,238,415 1 $ 172,079,069 1
An additional portion of the City's Net Assets ($1,750,000 or about 1%)
represents a nonexpendable resource that is subject to external restrictions. The
remaining balance of Unrestricted Net Assets ($70,643,725 or about 35%) may
be used to meet the government's ongoing obligations to its citizens and
creditors.
Governmental Activities. Governmental Activities increased the City's Net
Assets by $4,041,815.
See independent auditors' report.
11
Governmental
Activities
Bus Ines s -type
Activities
Total
June 30, 2012
June 30, 2011
June 30, 2012
June 30, 2011
June 30, 2012
June 30, 2011
Current and other assets
$ 73,574,121
$ 51,956,043
$ 3,714,840
$ 3,497,659
$ 77,288,961
$ 55,453,702
Capital assets
114,488,431
115,145,081
13,356,259
12,752,669
127,844,690
127,897,750
Total assets
188,062,552
167,101,124
17,071,099
16,250,328
205,133,651
183,351,452
Long-tennliabilities outstanding
370,799
6,296,201
-
-
370,799
6,296,201
Other liabilities
4,341,212
4,844,139
183,225
132,043
4,524,437
4,976,182
Total liabilities
4,712,011
11,140,340
183,225
132,043
4,895,236
11,272,383
Invested in capital assets
Restricted
Unrestricted
Total net assets
I$
114,488,431
1,750,000
67,112,110
183,350,541
115,145,081 13,356,259 12,752,669 127,844,690 127,897,750
1,750,000 1,750,000 1,750,000
39,065,703 3,531,615 3,365,616 70,643,725 42,431,319
$ 155,960,784 1 $ 16,887,874 1 $ 16,118,285 1 $ 200,238,415 1 $ 172,079,069 1
An additional portion of the City's Net Assets ($1,750,000 or about 1%)
represents a nonexpendable resource that is subject to external restrictions. The
remaining balance of Unrestricted Net Assets ($70,643,725 or about 35%) may
be used to meet the government's ongoing obligations to its citizens and
creditors.
Governmental Activities. Governmental Activities increased the City's Net
Assets by $4,041,815.
See independent auditors' report.
11
CITY OF RANCHO PALOS VERDES
MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2012
City of Rancho Palos Verdes Changes in Net Assets
Governmental
Activities
June 30, 2012
Business -type
Activities
Total
l June 30, 2011
June 30, 2012 1 June 30, 2011
June 30, 2012 j June 30, 2011
Program revenues :
Charges for services $ 3,770,567 $ 3,707,267 $ 1,330,074 $ 1,324,883 $ 5,100,641 $ 5,032,150
Operating contributions and grants 3,627,662 3,719,283 - 3,627,662 3,719,283
Capital contributions and grants 139,339 5,675 139,339 5,675
General revenues:
Property taxes
Other taxes
Other
11,480,461
9,686,419
655,329
11,854,171
9,234,107
588,959
11,480,461
9,686,419
655,329
11,854,171
9,234,107
588,959
Total revenues
29,359,777
29,109,462
1,330,074
1,324,883
30,689,851
30,434,345
Expenses:
Administration
Public safety
Public works
Parks and recreation
Community development
Non -departmental
Interest on long -Teri debt
Water Quality Flood Protection
5,906,436 5,996,735
4,177,926 4,334,961
11,202,446 10,389,064
1,489,940 1,390,604
2,432,175 2,622,293
109,039 260,045
560,485
489,524
5,906,436 5,996,735
4,177,926 4,334,961
11,202,446 10,3 89,064
1,489,940 1,390,604
2,432,175 2,622,293
109,039
560,485
260,045
489,524
Total exp ens es
25,317,962
24,993,702
560,485
489,524
25,878,447
25,483,226
Increase in net assets
4,041,815
4,115,760
769,589
835,359
4,811,404
4,951,119
Extraordinary gain
23,347,942
-
-
-
23,347,942
-
Increase in net assets
27,389,757
4,115,760
769,589
835,359
28,159,345
4,951,119
Net assets - beginning of fiscal year
155,960,784
151,845,024
16,118,285
15,282,926
172,079,069
167,127,950
Net as sets - end of fiscal year
$ 183,350,541
$ 155,960,784
$ 16,887,874
$ 16,118,285
$ 200,238,414
$ 172,079,069
As noted previously, the primary driver behind the increase was dissolution of the
former RDA. As the former RDA is no longer a component unit of the City, its
debt to the City of $19.3 million and its debt to the County of $5.5 million were
removed from the City's Government -Wide Financial Statements. In addition,
about $3.2 million of FY11-12 transient occupancy tax revenue was not spent,
but added to a Reserve for Future Capital Projects.
Revenues by Source — Governmental Activities
other taxes
33%
other charges for operating
2% services
13% contributions
and grants
2% capital
contributions
and grants
1%
See independent auditors' report.
12
property taxes
3 9%
CITY OF RANCHO PALOS VERDES
MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2012
Business -Type Activities. Business -type activities increased the City's net
assets by $769,589 primarily due to collection of storm drain user fees that will
be utilized during FY12-13 for projects continued from FY11-12.
Financial Analysis of Governmental Funds
As of the end of the current Fiscal Year, the City's Governmental Funds reported
combined ending Fund Balances of $48,485,062, an increase of $22 million in
comparison with the prior year. Approximately 75% of the combined ending
Fund Balances (about $36.2 million) constitutes spendable fund balance. The
combined spendable fund balance includes the CDBG and Measure A special
revenue negative unassigned fund deficit of $108,132. The remainder of the
combined ending Fund Balances is either nonspendable due to outside legal
restrictions ($1.82 million), or nonspendable in form (primarily for long-term
principal advances to other funds of $9.7 million, and prepaid items of $0.7
million).
The General Fund is the chief operating fund of the City of Rancho Palos Verdes.
At the end of the current fiscal year, the unassigned fund balance of the General
Fund was $12,464,439, while total Fund Balance reached $19,957,249. As a
measure of the General Fund's liquidity, it may be useful to compare both
Unassigned Fund Balance and Total Fund Balance to total fund uses
(expenditures and transfers out). Unassigned Fund Balance represents 55% of
total General Fund uses, while total Fund Balance represents 88% of that same
amount.
During Fiscal Year 11-12, the fund balance of the City's General Fund increased
by $1,056,987. This was primarily related to the favorable expenditure variances
totaling $1.2 million. The most notable of these favorable variances was
attributable to park and building maintenance savings of $0.2 million. The
remaining expenditure savings included about $60,000 for general liability
insurance in the City Manager's budget program, about $54,000 for
miscellaneous inspection services in the Public Works Administration program,
and other insignificant amounts (less than $75,000 or 0.4% of the General Fund
expenditure budget) spread among a large number of the General Fund's 30
budget programs.
The Street Maintenance Fund Balance increased by $141,751, primarily due to
permanent expenditure savings.
The Affordable Housing Fund Balance increased by $1,720,670, primarily due to
the transfer of housing assets from the former RDA as part of redevelopment
dissolution.
See independent auditors' report.
13
CITY OF RANCHO PALOS VERDES
MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2012
The Capital Improvement Projects (CIP) Fund had an ending fund balance of
$15,406,941. Of this amount, $4.0 million is held for street improvement projects
continued from FY11-12 to FY12-13, $1.2 million is held for park improvement
projects continued from FY11-12 to FY12-13, and the remaining $10.2 million is
held in reserve for emergency projects and future projects as directed by City
Council policy.
Financial Analysis of 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
Assets of the Enterprise Fund at the end of the year amounted to $3,531,615.
Unrestricted Net Assets of the Internal Service Funds at the end of the year
amounted to $3,617,838. The total growth in Proprietary Fund type net assets
was $345,877 or about 5% of unrestricted Net Assets.
General Fund Budgetary Highlights
The General Fund revenue budget was increased about $424,000 with the
Midyear Financial review primarily due to a revised estimate of transient
occupancy tax.
The difference between original budgeted expenditures and the final amended
budget was a decrease of $164,271; and is briefly summarized as follows:
➢ A decrease of $688,502 was attributable to appropriations continued to
FY12-13.
➢ An increase of $623,096 was attributable to appropriations continued from
FY10-11.
➢ Other immaterial adjustments resulted in net decreases of approximately
$99,000.
The City Council authorized additional General Fund transfers of $312,588 to
fund improvements to Abalone Cove Shoreline Park and $396,000 to fund the
Reserve for Future Capital Projects resulting from the revised estimate of
transient occupancy tax revenue.
Capital Asset and Debt Administration
Capital Assets. The City's investment in Capital Assets for its governmental
activities as of June 30, 2012, amounts to $114,488,431 (net of accumulated
depreciation). This investment in capital assets includes land, buildings, park
improvements, roadways, sewer, storm drains, vehicles, computer equipment,
See independent auditors' report.
14
CITY OF RANCHO PALOS VERDES
MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2012
furniture, other equipment, and construction in progress. During the current fiscal
year, the City's investment in governmental capital assets decreased by about
$656,650 or about 0.57%.
Major capital asset events during the current Fiscal Year included the following:
➢ Depreciation of $3.5 million was recorded for the City's Capital Assets.
➢ An arterial street repaving project was completed with a total cost of about
$2.4 million.
➢ The Ryan Park Ball Field improvements of about $275,000 were
completed.
➢ Sewer line relocation adjacent to the Palos Verdes Drive East switchbacks
was completed for a cost of about $210,000.
The Capital Assets (net of accumulated depreciation) for Business -type activities
as of June 30, 2012 was $13,356,259.
City of Rancho Palos Verdes Capital Assets
(net of depreciation)
Capital as sets not being depreciated
Land
Construction in progres s
Total capital assets not being depreciated
Govemmental
Activities
Business -type
Activities
Total
June 30, 2012 June 30, 2011
June 30, 2012 June 30, 2011
June 30, 2012
June 30, 2011
$ 39,881,986
430,058
40,312,044
$ 40,048,288
628,308
40,676,596
$ 1,408,493
1,516,924
2,925,417
$ 1,408,493
678,980
2,087,473
$ 41,290,479
1,946,982
43,237,461
$ 41,456,781
1,307,288
42,764,069
Capital assets being depreciated, net
Buildings
Vehicles
Computer equipment
Furniture, fixtures and equipment
Infrastructure
Roadway system
Sewer system
Storm drain system
Park s ys tem
6,953,126 7,156,296
58,405 94,656
117,773 35,181
78,677 123,861
46,448,299 46,304,199
8,198,687 8,447,475
9,930,462 10,180,941
2,390,958 2,125,876
1,181
6,953,126 7,156,296
58,405 94,656
117,773 35,181
78,677 125,042
46,448,299 46,304,199
- 8,198,687 8,447,475
10,430,842 10,664,015 20,361,304 20,844,956
2,390,958 2,125,876
Total capital assets being depreciated, net
74,176,387 74,468,485
10,430,842 10,665,196 84,607,229 85,133,681
Capital Assets, net
$ 114,488,431
$ 115,145,081
$ 13,356,259
$ 12,752,669
$ 127,844,690
$ 127,897,750
Additional information on the City's Capital Assets can be found in Note # 4 on
pages 56-57 of this report.
Long-term debt. At the end of the current Fiscal Year, the City of Rancho Palos
Verdes had total debt outstanding of $370,798 for Employee Compensated
Absences.
See independent auditors' report.
15
CITY OF RANCHO PALOS VERDES
MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2012
City of Rancho Palos Verdes Outstanding Debt
1Employee compensated absences
1
Total
Governmental
Activities
June 30, 2012 June 30, 2011
370,798
370,798 $
332,600
332,600
The City's total debt increased by $38,198 (11.5%) during the current Fiscal
Year, due to additional accrued time off not taken by employees.
State statutes limit the amount of general obligation debt a governmental entity
may issue to 15 percent of its total assessed valuation. The current debt
limitation for the City of Rancho Palos Verdes is $1,420,256,000. Additional
information on the City's long-term debt can be found in Note # 6 on pages 58-59
of this report.
Economic Factors and Next Year's Budgets and Rates
➢ Property tax revenue accounts for about 38 percent of Government -Wide
revenues. Local property values remain strong, and the City's property
assessments grew by 2.3% for FY12-13.
➢ The Consumer Price Index for Los Angeles County increased by 1.6% for
the 12 months ended June 2012. The City's FY12-13 expenditure budget
increased by 2.0% when compared to FY11-12. Revenue in excess of
budgeted expenditures (about $4.9 million) has been programmed for
capital improvement projects.
Requests for Information
This Financial Report is designed to provide a general overview of the financial
position of the City of Rancho Palos Verdes 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 financial information, should be addressed
to the Finance and Information Technology Department at 30940 Hawthorne
Boulevard, Rancho Palos Verdes, CA 90275 or financenrpv.com.
See independent auditors' report.
16
BASIC FINANCIAL STATEMENTS
17
MARILYN RYAN
1932 - 2008
MARILYN'RYAN' SUNSET" Pc]INT PARK IS HEREBY NAMED IIN HONOR OF
THE REMARKABLE WOMAN wJIO WAS INSTRUMENTAL IN THE
FORMATION OF TIIE CITY OF J{ANV JO PALOS VERDES_ MARILYN RYAN
WAS Co -FOUNDER JF SAVE OUR COANTI,1IVE. AN ORGANLZATioN
wHICFI BATTLED THE COLJNTY OVER HIGH-DENSITY DEVELOPMENT 114
THE 1960'S AND EARLY 1970'5_ MARILYN RYAN SPEARHEADED THE
DRIVE FOR THE CITY OF RANCHO PALOS VERDES- INCORPORATION.,
ACHIEVED IPr SEPTEMBER 3973. SHE WAS ELECTED TILE FIRST MAYOR
OF TJ -IF CITY OF RANCHO PALOS VERDES AFTER RECEIVING THE
HF(HEST NUMBER OF VOTES OUT OF A FIELD OF 24 CANDIDATFti, SHE
SERVED TWO TERMS BEFORE BEINCL ELECTED TO THE 51ST STATE
ASSEMBLY DISTRICT IN 1977, WHERE SHE SERVED FOR 51X YEARS.
MARILYN RYAN'S LIFE AND DEDICATION TO LOCAL CONTROL AND
PRESERVING THE QUAL/TY OF LIFE FOR ALL RESIDENTS OF
RANCHO PALOS VERDES IS DEEPLY CHERISHED AND CELEBRATED_
TE-fJS PARK IS DEDICATED IN HER HONOR ON
THIS 2STH DAY OF OCTOBER 200B,
Marilyn Ryan Sunset Park Dedication
18
GOVERNMENT -WIDE STATEMENTS
19
Story Time with Santa
CITY OF RANCHO PALOS VERDES
STATEMENT OF NET ASSETS
June 30, 2012
Governmental Business -type
Activities Activity Total
ASSETS:
Cash and investments $ 43,767,067 $ 3,640,715 $ 47,407,782
Receivables:
Taxes 1,391,347 1,391,347
huterest 30,933 2,663 33,596
Notes 7,308,481 - 7,308,481
Other 745,230 71,462 816,692
huventory 34,058 34,058
Prepaid costs 1,007,946 1,007,946
Receivable from Successor Agency 19,289,059 19,289,059
Capital assets, not being depreciated:
Land 39,881,992 1,408,493 41,290,485
Construction in progress 430,056 1,516,924 1,946,980
Capital assets, being depreciated, net:
Property and equipment 254,851 254,851
Buildings and improvements 6,953,126 6,953,126
Infrastructure 66,968,406 10,430,842 77,399,248
TOTAL ASSETS 188,062,552 17,071,099 205,133,651
LIABILITIES:
Accounts payable and accrued liabilities 3,279,855 176,451 3,456,306
Retentions payable 212,362 6,774 219,136
Unearned revenue 100,830 100,830
Deposits payable 748,166 748,166
Long-term liabilities:
Due within one year 260,434 260,434
Due beyond one year 110,365 110,365
TOTAL LIABILITIES 4,712,011 183,225 4,895,237
NET ASSETS:
huvested in capital assets
Restricted for:
Community development:
Nonexpendable
Unrestricted
114,488,431
1,750,000
67,112,110
13,356,259 127,844,690
3,531,615
1,750,000
70,643,725
TOTAL NET ASSETS $ 183,350,541 $ 16,887,874 $ 200,238,415
See independent auditors' report and notes to financial statements.
CITY OF RANCHO PALOS VERDES
STATEMENT OF ACTIVITIES
For the year ended June 30, 2012
Program Revenues
Operating Capital
Charges for Grants and Grants and
Functions/programs Expenses Services Contributions Contributions
Governmental Activities:
Administration
Public safety
Public works
Parks and recreation
Conununity development
Interest on long-term debt
$ 5,906,436 $ 746,672 $ 48,135 $
4,177,926 193,568 100,000
11,202,446 683,643 3,272,927 139,339
1,489,940 502,586 32,316
2,432,175 1,644,098 174,284
109,039 - -
Total governmental activities 25,317,962 3,770,567 3,627,662 139,339
Business -type Activity:
(758,624) 1,319,109 -
Water Protection Flood Control
Total Primary Government $ 24,559,338 $ 5,089,676 $ 3,627,662 $ 139,339
General revenues:
Taxes:
Property taxes
Transient occupancy tax
Sales tax
Franchise tax
Utility user tax
Other taxes
Investment income
Unrestricted grants, contributions and other revenues
Total general revenues and transfers
Extraordinary item:
Gain on dissolution of Redevelopment Agency (Note 14)
Change in net assets
Net assets - beginning of year, as restated
Net assets - end of year
See independent auditors' report and notes to financial statements.
22
Net (Expense) Revenue and
Changes in Net Assets
Govermnental Business -type
Activities Activity
Total
$ (5,111,629) $ - $ (5,111,629)
(3,884,358) - (3,884,358)
(7,106,537) - (7,106,537)
(955,038) - (955,038)
(613,793) - (613,793)
(109,039) - (109,039)
(17,780,394) - (17,780,394)
(17,780,394)
758,624 758,624
758,624 (17,021,770)
11,480,461 - 11,480,461
3,349,015 - 3,349,015
1,448,508 - 1,448,508
1,881,163 - 1,881,163
2,333,440 - 2,333,440
674,293 - 674,293
603,776 10,965 614,741
51,553 - 51,553
21,822,209 10,965 21,833,174
23,347,942 - 23,347,942
27,389,757 769,589 28,159,346
155,960,784 16,118,285 172,079,069
$ 183,350,541 $ 16,887,874 $ 200,238,415
23
City Hall
FUND FINANCIAL STATEMENTS
25
CITY OF RANCHO PALOS VERDES
BALANCE SHEET - GOVERNMENTAL FUNDS
June 30, 2012
ASSETS
Cash and investments
Receivables:
Taxes
Interest
Notes
Other
Due from other funds
Inventory
Prepaid items
Receivable from Successor Agenc3
TOTAL ASSETS
LIABILITIES AND FUND BALANCES
LIABILITIES:
Accounts payable and accrued liabilities
Due to other funds
Retentions payable
Deferred revenue
Deposits payable
TOTAL LIABILITIES
FUND BALANCES (DEFICIT):
Non -Spendable
Endowment principal
Reimbursement settlement agreemen
Prepaid items
Receivable from Successor Agenc3
Long term receivables
Habitat restoration
Inventory
Restricted
Assigned
Unassigned
TOTAL FUND BALANCES (DEFICIT)
TOTAL LIABILITIES AND FUND BALANCES
Special
Revenue
Street
General Maintenance
$ 13,548,910 $ 1,487,816
1,214,207 122,665
12,141 573
429,147 3,590
270,179
34,058 -
715,974 -
19,289,059 -
$ 35,513,676 $ 1,614,644
$ 2,066,837
13,272
12,728,151
748,166
15,556,426
$ 551,475
5,622
651
557,748
715,974 -
6,742,778 -
34,058 -
1,056,896
12,464,439
19,957,249 1,056,896
$ 35,513,675 $ 1,614,644
See independent auditors' report and notes to financial statements
26
Special Capital
Revenue Projects Other Total
Affordable Capital Governmental Governmental
Housing Improvements Funds Funds
$ 500,826 $ 15,950,665 $ 8,750,890 $ 40,239,107
- 54,475 1,391,347
365 8,726 6,560 28,365
6,829,457 - 479,024 7,308,481
29,204 282,208 744,149
- - 270,179
- - 34,058
899 - - 716,873
- - - 19,289,059
$ 7,331,547 $ 15,988,595 $ 9,573,157 $ 70,021,618
$ 901 $ 357,957 216,355 $ 3,193,525
- 151,665 151,665
193,468 - 212,362
3,839,457 30,229 632,350 17,230,838
- - 748,166
3,840,358 581,654 1,000,370 21,536,556
- 750,000 750,000
- 1,000,000 1,000,000
899 - - 716,873
- - - 6,742,778
2,990,000 - - 2,990,000
- 74,696 y 74,696
- - 34,058
500,290 - 6,856,223 8,413,409
15,406,941 - 15,406,941
- (108,132) 12,356,307
3,491,189 15,406,941 8,572,787 48,485,062
$ 7,331,547 $ 15,988,595 $ 9,573,157 $ 70,021,618
Egg Hunt
CITY OF RANCHO PALOS VERDES
RECONCILIATION OF THE GOVERNMENTAL FUNDS
BALANCE SHEET TO THE STATEMENT OF NET ASSETS
June 30, 2012
Fund balances - total governmental funds $ 48,485,062
Amounts reported for governmental activities in the Statement of Net Assets are different because:
Capital assets used in governmental activities are not current financial resources and, therefore,
are not reported in the governmental funds balance sheet. 114,233,580
Interest accrued on the receivable from Successor Agency in the General Fund is not available as current
resource and, therefore, is recorded as deferred revenue and added to the balance of the advance. The
Statement of Net Assets reports on the full accrual basis and does not defer currently unavailable
revenues. 12,546,284
Intergovernmental revenues earned, but not available, are deferred in the fund financial statements.
The revenue is not deferred on the Statement of Activities. 265,244
Long-term notes receivable are not current available resources and, therefore, do not affect the
governmental fund balance. 4,318,481
Long-term liabilities are not due and payable in the current period and, therefore, are not reported
in the governmental funds. (370,799)
Internal service funds are used by management to charge the costs of certain activities, including
equipment and building replacement and employee benefits, to individual funds. The assets
and liabilities of the internal service funds are included in the Statement of Net Assets.
3,872,689
Net assets of governmental activities $ 183,350,541
See independent auditors' report and notes to financial statements.
29
CITY OF RANCHO PALOS VERDES
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS
For the year ended June 30, 2012
Special
Revenue
Street
General Maintenance
REVENUES:
Taxes $ 20,606,160 $ -
Licenses and permits 1,806,147 -
Fines and forfeitures 159,488
Use of money and property 754,473 15,862
Charges for services 145,924 2,900
Revenue from other agencies 6,365 1,206,626
Other revenues 192,300 -
TOTAL REVENUES 23,670,857 1,225,388
EXPENDITURES:
Current:
Administration 5,624,776
Public safety 4,177,926 -
Public works 3,723,884 1,976,064
Parks and recreation 1,454,414 -
Community development 2,479,898
Capital outlay -
Debt service:
Principal
Interest and fiscal charges
TOTAL EXPENDITURES
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
OTHER FINANCING SOURCES (USES):
Transfers in
Transfers out
TOTAL OTHER FINANCING SOURCES (USES)
17,460,898 1,976,064
6,209,959 (750,676)
540,000 945,088
(5,692,972) (52,661)
(5,152,972) 892,427
EXTRAORDINARY ITEM:
Gain on dissolution of Redevelopment Agency (Note 14, - -
NET CHANGE IN FUND BALANCES 1,056,987 141,751
FUND BALANCES (DEFICIT) - BEGINNING OF YEAR 18,900,262 915,145
FUND BALANCES (DEFICIT) - END OF YEAR $ 19,957,249 $ 1,056,896
See independent auditors' report and notes to financial statements
30
Special Capital
Revenue Projects Other Total
Affordable Capital Governmental Governmental
Housing Improvements Funds Funds
$ - $ - $ 1,260,876 $ 21,867,036
- - 1,806,147
- - 159,488
697 36,780 542,083 1,349,895
- - - 148,824
- 139,340 2,069,026 3,421,357
- - 66,341 258,641
697 176,120 3,938,326 29,011,389
- - 100,940 5,725,716
- - - 4,177,926
- - 1,915,836 7,615,784
- - 25,000 1,479,414
3,659 - 288 2,483,845
- 2,939,431 215,539 3,154,970
- - 463,698 463,698
- - 497,934 497,934
3,659 2,939,431 3,219,235 25,599,287
(2,962) (2,763,311) 719,092 3,412,103
- 6,520,472 220,700 8,226,260
- - (2,110,110) (7,855,743)
- 6,520,472 (1,889,410) 370,517
1,723,632 - 16,516,488 18,240,119
1,720,670 3,757,161 15,346,170 22,022,739
1,770,519 11,649,780 (6,773,383) 26,462,323
$ 3,491,189 $ 15,406,941 $ 8,572,787 $ 48,485,062
31
CITY OF RANCHO PALOS VERDES
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES
For the year ended June 30, 2012
Net change in fund balances - total governmental funds $ 22,022,739
Amounts reported for governmental activities in the Statement of Activities are different because:
Governmental funds report capital outlays as expenditures. However, in the Statement of Activities,
the cost of those assets is allocated over their estimated useful lives as depreciation expense, or
are allocated to the appropriate functional expense when the cost is below the capitalization threshold.
Asset disposals are also not recognized in the governmental funds. This activity reconciled as follows:
Cost of assets capitalized 2,864,926
Depreciation expense (3,356,433)
Unpaid accrued interest income is deferred in the governmental funds since it is not available. This
income is accrued in the Statement of Activities. 819,586
Intergovernmental revenues earned, but not available are deferred in the fund financial statements. (91,861)
Interest expenditures are recognized when due, and therefore, interest payable is not recorded in the
governmental funds. This amount represents the net change in interest payable. 20,086
Increases in long-term notes receivable use current financial resources and are included in the expenditures
of governmental funds. Repayments of long-term notes receivables provide current financial resources
and are included in the revenues of governmental funds. These changes in notes receivable are not
reflected in the revenues or expenses of the Statement of Activities. This amount represents the net
change in the long-term notes receivable. 1,104
Compensated absences expenses reported in the Statement of Activities do not require the use of current
financial resources and therefore are not reported as expenditures in governmental funds. (38,199)
Principal payments on debt are recorded as expenditures in the funds. The expenditure is not recognized
in the Statement of Activities since it reduces the liability reported on the Statement of Net Assets.
Principal payments consisted of the following:
Redevelopment Agency tax increment bond
Redevelopment Agency deferred interest payable
Internal service funds are used by management to charge the costs of certain activities, including equipment
and building replacement and employee benefits, to individual funds. The net revenues/(expenses) of the
internal service funds (excluding transfers and interest income) are reported with governmental activities.
The Rancho Palos Verdes Redevelopment Agency was dissolved as of February 1, 2012 pursuant to Assembly
Bills lx 26 and 1484. Capital assets and long-term liabilities of the dissolved Agency were transferred to
the Successor Agency Private -Purpose Trust Fund:
Transfer of land
Transfer of note receivable
Transfer of tax increment bonds
Transfer of deferred interest payable
Change in net assets of governmental activities
See independent auditors' report and notes to financial statements.
32
100,000
363,698
(423,712)
(166,296)
(225,785)
5,065,000
434,904
$ 27,389,757
CITY OF RANCHO PALOS VERDES
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
GENERAL FUND
For the year ended June 30, 2012
Budgeted Amounts
Original Final
Actual
Variance with
Final Budget
Positive
(Negative)
REVENUES:
Taxes $ 20,058,800 $ 20,550,800 $ 20,606,160 $ 55,360
Licenses and permits 2,043,600 2,043,600 1,806,147 (237,453)
Fines and forfeitures 154,900 223,900 159,488 (64,412)
Use of money and property 567,900 567,900 754,473 186,573
Charges for services 66,800 66,800 145,924 79,124
Revenue from other agencies 151,900 15,000 6,365 (8,635)
Other revenues 154,300 154,300 192,300 38,000
TOTAL REVENUES 23,198,200 23,622,300 23,670,857 48,557
EXPENDITURES:
Administration
City council 136,500 136,500 133,698 2,802
City manager 1,671,300 1,767,195 1,656,174 111,021
City attorney 1,065,000 1,065,000 1,057,102 7,898
Community outreach 208,800 217,300 212,156 5,144
City clerk 492,550 524,750 503,877 20,873
Personnel 251,350 293,450 294,298 (848)
Finance 1,375,300 1,351,388 1,341,972 9,416
Information technology - Data 599,200 411,500 356,281 55,219
Information technology - Voice 93,800 93,800 69,218 24,582
Total Administration 5,893,800 5,860,883 5,624,776 236,107
Public safety
Sheriff 4,015,000 4,015,000 3,957,051 57,949
Special programs 71,500 89,500 24,513 64,987
Animal control 120,250 130,250 55,862 74,388
Emergency preparedness 148,300 141,948 140,500 1,448
Total Public Safety 4,355,050 4,376,698 4,177,926 198,772
Public Works
Public works administration
Traffic management
Storm water quality
Building maintenance
Park/Trail/Open Space maintenance
Sewer maintenance
Total Public Works
2,055,000 2,095,408 1,974,634 120,774
154,000 169,700 139,712 29,988
180,300 180,300 92,945 87,355
620,800 608,800 491,226 117,574
1,130,250 1,167,270 1,012,060 155,210
63,000 63,375 13,307 50,068
4,203,350 4,284,853 3,723,884 560,969
33
CITY OF RANCHO PALOS VERDES
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL (continued)
GENERAL FUND
For the year ended June 30, 2012
Budgeted Amounts
Original Final
Actual
Variance with
Final Budget
Positive
(Negative)
Parks and Recreation
Recreation administration 779,300 593,700 555,664 38,036
Recreation facilities 441,190 454,490 448,980 5,510
Special events 52,200 52,539 45,025 7,514
PVIC 383,375 382,275 356,709 25,566
REACH 53,800 53,700 48,036 5,664
Total Parks and Recreation 1,709,865 1,536,704 1,454,414 82,290
Cornrnunity Development
Planning services 1,296,800 1,303,070 1,302,440 630
Building & safety 653,200 586,806 574,613 12,193
Code enforcement 208,500 207,000 187,237 19,763
View restoration/preservation 339,500 337,400 324,520 12,880
NCCP - 2,380 2,380 -
Geology 150,000 150,000 88,708 61,292
Total Cornrnunity Development 2,648,000 2,586,656 2,479,898 106,758
TOTAL EXPENDITURES 18,810,065 18,645,794 17,460,898 1,184,897
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
OTHER FINANCING SOURCES (USES):
Transfers in
Transfers out
4,388,135 4,976,506
452,000 552,000
(4,839,253) (5,572,241)
6,209,959 1,233,453
540,000
(5,692,972)
(12,000)
(120,731)
TOTAL OTHER FINANCING
SOURCES (USES) (4,387,253) (5,020,241) (5,152,972) (132,731)
NET CHANGE IN FUND BALANCE 882 (43,735) 1,056,987 1,100,722
FUND BALANCE - BEGINNING OF YEAR 18,900,262 18,900,262 18,900,262 -
FUND BALANCE - END OF YEAR $ 18,901,144 $ 18,856,527 $ 19,957,249 $ 1,100,722
See independent auditors' report and notes to financial statements.
34
CITY OF RANCHO PALOS VERDES
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
STREET MAINTENANCE SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Use of money and property $ 17,010 $ 17,010 $ 15,862 $ (1,148)
Charges for services 14,000 14,000 2,900 (11,100)
Revenue from other agencies 1,129,800 1,129,800 1,206,626 76,826
TOTAL REVENUES
EXPENDITURES:
Public Works
Street landscape maintenance
Traffic signal maintenance
Portuguese Bend road maintenance
1,160,810 1,160,810 1,225,388 64,578
1,602,279 1,675,299 1,376,572 298,727
202,000 112,000 73,767 38,233
516,400 566,400 525,725 40,675
TOTAL EXPENDITURES 2,320,679
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
OTHER FINANCING SOURCES:
Transfers in
Transfers out
2,353,699 1,976,064 377,635
(1,159,869) (1,192,889) (750,676) 442,213
1,074,400 1,074,400 945,088 (129,312)
- (52,661) (52,661)
TOTAL OTHER FINANCING
SOURCES (USES) 1,074,400 1,021,739 892,427 (129,312)
NET CHANGE IN FUND BALANCE (85,469) (171,150) 141,751 312,901
FUND BALANCE - BEGINNING OF YEAR 915,145 915,145 915,145 -
FUND BALANCE - END OF YEAR $ 829,676 $ 743,995 $ 1,056,896 $ 312,901
See independent auditors' report and notes to financial statements.
35
CITY OF RANCHO PALOS VERDES
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
AFFORDABLE HOUSING SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Other revenues $ 330,000 $ 330,000 $ $ (330,000)
Use of money and property 10 10 697 687
TOTAL REVENUES 330,010 330,010 697 (329,313)
EXPENDITURES:
Community development 2,000 4,000 3,659 341
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES 328,010 326,010 (2,962) (328,972)
EXTRAORDINARY GAIN (LOSS) - 1,723,632 1,723,632
NET CHANGE IN FUND BALANCE 328,010 326,010 1,720,670 1,394,660
FUND BALANCE - BEGINNING OF YEAR 1,770,519 1,770,519 1,770,519 -
FUND BALANCE - END OF YEAR $ 2,098,529 $ 2,096,529 $ 3,491,189 $ 1,394,660
See independent auditors' report and notes to financial statements
36
CITY OF RANCHO PALOS VERDES
STATEMENT OF NET ASSETS
PROPRIETARY FUNDS
June 30, 2012
ASSETS
Business -type Governmental
Activity- Activities -
Water Quality Internal
Flood Protection Service
Enterprise Fund Funds
CURRENT ASSETS:
Cash and investments $ 3,640,715 $ 3,527,960
Receivables:
Interest 2,663 2,568
Other 71,462 1,081
Prepaid items - 291,073
TOTAL CURRENT ASSETS 3,714,840 3,822,682
NONCURRENT ASSETS:
Capital assets, not being depreciated:
Land 1408,493
Construction in progress 1,516,924
Capital assets, being depreciated:
Property and equipment 11,813 1,603,512
Infrastructure 11,338,573 -
Accumulated depreciation (919,544) (1,348,661)
TOTAL NONCURRENT ASSETS 13,356,259 254,851
TOTAL ASSETS 17,071,099 4,077,533
LIABILITIES
CURRENT LIABILITIES:
Accounts payable and accrued liabilities 176451 86,330
Retentions payable 6,774 -
Due to other fund - 118,514
TOTAL CURRENT LIABILITIES 183,225 204,844
NET ASSETS
Invested in capital assets 13,356,259 254,851
Unrestricted 3,531,615 3,617,838
TOTAL NET ASSETS $ 16,887,874 $ 3,872,689
See independent auditors' report and notes to financial statements.
CITY OF RANCHO PALOS VERDES
STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN NET ASSETS - PROPRIETARY FUNDS
For the year ended June 30, 2012
Business -type Governmental
Activity- Activities -
Water Quality Internal
Flood Protection Service
Enterprise Fund Funds
OPERATING REVENUES:
Charges for services 1,319,109 $ 2,301,500
OPERATING EXPENSES:
Personnel services 141,320 1,869,945
Materials and supplies 98,452 154,354
Maintenance 86,359 236,948
Depreciation 234,354 133,485
TOTAL OPERATING EXPENSES 560485 2,394,732
OPERATING LOSS 758,624 (93,232)
NONOPERATING REVENUES:
Other revenues - 28,618
Interest income 10,965 11419
TOTAL NONOPERATING REVENUES 10,965 40,037
INCOME (LOSS) BEFORE TRANSFERS 769,589 (53,195)
TRANSFER OUT (370,517)
CHANGE IN NET ASSETS 769,589 (423,712)
TOTAL NET ASSETS - BEGINNING OF YEAR 16,118,285 4,296401
TOTAL NET ASSETS - END OF YEAR $ 16,887,874 $ 3,872,689
See independent auditors' report and notes to financial statements.
CITY OF RANCHO PALOS VERDES
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
For the year ended June 30, 2012
Business -type Governmental
Activity- Activities -
Water Quality Internal
Flood Protection Service
Enterprise Fund Funds
CASH FLOWS FROM OPERATING ACTIVITIES:
Receipts from interfund services provided $ $ 2,420,014
Receipts from storm drain user fees 1,309,906 -
Payments to suppliers (184,811) (434,978)
Payments to employees (141,320) (2,039,616)
NET CASH USED BY OPERATING ACTIVITIES 983,775 (54,580)
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:
Acquisition and construction of capital assets (786361) (134,637)
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Receipts from other revenues 27,537
Transfer to other funds (370,517)
NET CASH PROVIDED FROM NON -CAPITAL
FINANCING ACTIVITIES (342,980)
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest received on investments 11,680 13,362
NET INCREASE (DECREASE)
IN CASH AND CASH EQUIVALENTS 208,694 (518,835)
CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR 3,432,022 4,046,795
CASH AND CASH EQUIVALENTS - END OF YEAR $ 3,640,715 $ 3,527,960
RECONCILIATION OF OPERATING LOSS TO
NET CASH USED BY OPERATING ACTIVITIES:
Operating income (loss) $ 758,624 $ (93,232)
Adjustments to reconcile operating loss
to net cash used by operating activities:
Depreciation 234,354 133,485
Changes in operating assets and liabilities:
Increase in other receivable (9,203)
Increase in prepaid items (28,989)
Decrease in accrued liabilities (184,358)
Increase in due to other fund 118,514
NET CASH USED BY OPERATING ACTIVITIES $ 983,775 $ (54,580)
See independent auditors' report and notes to financial statements.
CITY OF RANCHO PALOS VERDES
STATEMENT OF FIDUCIARY NET ASSETS
FIDUCIARY FUNDS
June 30, 2012
Successor Agency to the
Rancho Palos Verdes
Redevelopment Agency
Private -Purpose Trust Fund
ASSETS
Cash and investments $ 625,260
Receivables:
Interest 10
Notes 204,950
Prepaid items 182,195
Land 166,296
TOTAL ASSETS
LIABILITIES AND FUND BALANCES
$ 1,178,711
LIABILITIES:
Accounts payable and accrued liabilitie $ 57,772
Long-term liabilities
Due within one yeas 120,000
Due beyond one yew 24,668,963
TOTAL LIABILITIES 24,846,735
NET DEFICIT HELD IN TRUST $ (23,668,024)
See independent auditors' report and notes to financial statements
CITY OF RANCHO PALOS VERDES
STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS
FIDUCIARY FUNDS
For the Five Months Ended June 30, 2012
ADDITIONS:
Taxes
Use of money and property
TOTAL ADDITIONS
DEDUCTIONS:
Administration
Interest and fiscal charges
TOTAL DEDUCTIONS
EXTRAORDINARY LOSS ON DISSOLUTION OF
REDEVELOPMENT AGENCY
CHANGE IN NET ASSETS
NET ASSETS - FEBRUARY 1, 2012
NET ASSETS - END OF YEAR
See independent auditors' report and notes to financial statements
Successor Agency to the
Rancho Palos Verdes
Redevelopment Agency
Private -Purpose Trust Fund
118,818
10
118,828
50,139
388,771
438,910
(23,347,942)
(23,668,024)
(23,668,024)
Emergency
Preparedness
leplpdg
FALL 2011
CITY OF RANCHO PALOS VERDES
OFFK(IAL NLWSLL I I Lk • 30940 1 IAW f 1 ORNL 90).LLVA9I),1)RANC110 1X11 09 VL RDf 9 CA 90275 • WLBSI I L 1W V RALOSVLRDLSCOMR'PV • (310) 377-0360
LADERA LINDA COMMUNITY
CENTER MASTER PLANNING
PROJECT
One glance at its architecture and
you can tell that the Ladera Linda
Community Center began its life
as an elementary school. If the
flat roofed, low -slung bungalows
clustered around a central courtyard
don't give it away, it's certainly the
banks of large windows fronting
each forrner classroom and the
drinking fountains that are just a
bit too low for an adult to use
comfortably. In fact, the facility,
which was built in 1967, served in
that capacity for 15 years. The City
has been using it as a community
center since 1982 and purchased
the property from the Palos Verdes
Peninsula Unified School District
in 1986.
continued on page 2
BEWARE OF LEAD-BASED PAINT
• Is your home being
renovated, repaired,
or painted?
• Was your home or
building built before 1978?
If the answer to these questions
is YES, there are a few important
things you need to know about
lead-based paint- Federal law
requires contractors that disturb
painted surfaces in homes, child
care facilities and schools built
before 1978 to be certified and
follow specific work practices to
prevent lead contamination.
serum Soled o4DUR1
eisa
•ssssod Yn
d15•3aad
w11air LVL.au:nc.'L'arm:,,--
The most common way to get lead
in the body is from dust. Lead dust
comes from deteriorating lead-
based paint and lead -contaminated
soil that gets tracked Into your
home. This dust may accumulate to
unsafe levels. Then, normal hand
to -mouth activities, like playing
and eating (especially in young
children), move that dust from
surfaces like floors and window sills
into the body.
IOM[ R[h0VAT-
,RF A11HI9.o
Common renovation activities like
sanding, cutting, and demolition
can create hazardous lead dust
and chips.
II., CI i'H TI:!_)�l lilt lli
The key to protecting yourself and
your family during a renovation,
repair or painting job is to use
lead -safe work practices such as
containing dust inside the work
area, using dust -minimizing work
methods, and conducting a
careful deanup.
continued on page 3
LOCAL ELECTION SCHEDULED
FOR TUESDAY, �•
NOVEMBER 8, 2011
•
COUNCIL CANDIDATES
The City of Rancho Palos Verdes will
hold its General Municipal Election
on November 8, 2011 for three
City Council Member seats. The
nomination period for candidates
for City Council began on Monday,
July 18, 2011 and closed on Friday,
August 12, 2011. A total of 8
candidates have qualified to run for
3 open seats.
Monday, October 24, 2011 is the
last day to register to vote in the
November 8, 2011 Election. You
will need to re -register if you have
just moved into the City, if you have
a new address, changed your name,
or changed your political party
affiliation. Voter Registration Forms
are available at City Hall, the Post
Office, and the library.
VOTE BY MAIL
Voters who wish to vote by mail
must submit a written request
to the Los Angeles County Registrar-
Recorder/County Clerk for a ballot
no later than 7 days prior to the
Election Day. Your written request
must identify the election for which
a ballot is being requested, and
must contain the voter's name and
signature, registered address, and
the address to which the ballot
should be mailed. The signature
of each person requesting a vote
by mail ballot is required in order
continued on page 4
AIRSPACE SAFETY AND NOISE
CONCERNS - WHO TO CALL!
The City of Rancho Palos Verdes is dedicated to improved aviation
safety and noise reduction in the airspace above us. While the City of
Rancho Palos Verdes has no direct authority over airspace, the City takes
aircraft safety and noise impacts on our residents very seriously.
Resident feedback is appreciated in the ongoing effort to mitigate noise
levels. Knowing the type of aircraft is important in determining which
airport hotline to contact. Aviation activity over or near the Peninsula is
typically divided into two categories: General Aviation Aircraft and
Scheduled Air Transport.
• General Aviation refers to all private and commerdal flights, other than
military and scheduled airline and cargo flights. General aviation aircraft
flying over or near the Palos Verdes Peninsula is typically departing from
Torrance Airport and is usually small fixed -wing aircraft or helicopters.
• Scheduled Air Transport includes a wide range of jet airplanes and
turbo -prop aircraft operating on regularly scheduled routes. Scheduled
aircraft flying over or near the Palos Verdes Peninsula is typically
departing from LAX.
11.1'10 ti0159 COMP) Al,
PLEASE NOTE:
The LAX Noise Complaint area code has changed from (3101 to 1424).
LAX
Go to http://lax.webtrak-lochard.com/webtrak/bx4 to file an LAX WebTrak noise
complaint or call the noise complaint hotline at (424) 646-6473.
Torrance
Go to http://www.torrancecagov/Airport/2254.htm to contact the Torrance
Noise Abatement website, or call Torrance Noise Abatement at (310) 784-7950.
Long Beach
Go to http://webtrak.bksvcom/Igb to file a Long Beach Airport Webtrak noise
complaint or call the Long Beach noise complaint hotline 3t 1562) 570-2665.
Contacting Rancho Palos Verdes Staff
The public is encouraged to let the City know their thoughts and
concerns regarding Peninsula airspace issues.
Erna) staff at faaairspaceOrpv.com or call (3101544-5218.
SE06 MK121OJ1VHJ
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42
517106 VI) '833MA 90161j 01 -1 --WI
QNt9\3TO)1 ]J2f 11A4V 109606
SIAM SOACI 091 * R?j JO ,UO
NOTES TO FINANCIAL STATEMENTS
43
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
NOTE #1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies of the City of Rancho Palos Verdes (the City) conform to
accounting principles generally accepted in the United States of America as
applicable to governments. The Governmental Accounting Standards Board
(GASB) is the accepted standard setting body for governmental accounting and
financial reporting principles. The following is a summary of the significant policies.
A. Reporting Entity
The reporting entity, "City of Rancho Palos Verdes", includes the accounts of the
City, the Rancho Palos Verdes Redevelopment Agency (the Agency), and the Joint
Powers Improvement Authority (the Authority).
The City was incorporated on September 7, 1973, as a General Law City and
operates under a Council/Manager form of government.
The Redevelopment Agency was formed in 1984 pursuant to the State of
California Health and Safety Code Section 33000 entitled "Community
Redevelopment Law" with a purpose to finance long-term capital improvements
designed to eliminate physical and economic blight in a project area through
stabilization of hazardous landslides. Effective February 1, 2012, pursuant to state
law, the Redevelopment Agency was dissolved and its assets were transferred to
the Successor Agency for the purpose of winding down the business of the former
Redevelopment Agency (see Note # 13).
The Authority was formed on September 4, 1990, in accordance with the
provisions of the Reimbursement and Settlement Agreement, dated October 27,
1987, entered into by the City, the former Redevelopment Agency, and the County
of Los Angeles (the County) in connection with the Horan Lawsuit. The Agreement
requires funds to be set aside and expended by the Authority to maintain landslide
abatement improvements installed and constructed by the former Redevelopment
Agency.
The criteria used in determining the scope of the reporting entity are based on the
provisions of GASB Statement 14. The City of Rancho Palos Verdes is the primary
government unit. Component units are those entities which are financially
accountable to the primary government, either because the City appoints a voting
majority of the component unit's Board, or because the component unit will provide
a financial benefit or impose a financial burden on the City. The City has accounted
for the former Redevelopment Agency and the Authority as "blended" component
units. Despite being legally separate entities, the former Redevelopment Agency
and the Authority are so intertwined with the City, they are, in substance, part of
the City's operations.
See independent auditors' report.
44
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Accordingly, the balances and transactions of the former Redevelopment Agency
for the seven month period from July 1, 2011 through January 31, 2012 are
reported as separate Special Revenue, Debt Service and Capital Projects Funds.
The balances and transactions of the Authority are reported as separate
Permanent and Special Revenue Funds. The following specific criteria were used
in determining that the Successor Agency and the Authority are "blended"
component units:
1) The members of the City Council also act as the governing bodies of the
component units.
2) The City, the former Redevelopment Agency, and the Authority are financially
interdependent. The City subsidizes maintenance operations performed by the
Authority. The City made loans to the former Redevelopment Agency for use on
redevelopment projects.
3) Employees of the City manage both the City and the component units.
Separately issued financial statements for the Authority may be obtained at the
City's administrative offices.
Participation in Public Entity Joint Powers Authority
The City is a member of the Palos Verdes Peninsula Transit Joint Powers Authority
(the Transit Authority). The Transit Authority is comprised of three member cities
and is organized under a Joint Powers Agreement pursuant to the California
Government Code. The purpose of the Authority is to study, implement, and
provide a public transit system within and around the Palos Verdes Peninsula.
These transit services include Palos Verdes Transit, Dial -A -Ride, and a fixed route
shuttle service. Periodic deposits are paid by member Cities and are adjusted
retrospectively to cover costs. Costs are prorated among all participating Cities
based on population.
The City does not have an equity interest in the Transit Authority; therefore, no
amount has been reported in the Statement of Net Assets. However, the City does
have an ongoing financial interest, because the City is able to influence the
operations of the Authority so that the Authority uses its resources on behalf of the
City. Also, an ongoing financial responsibility exists because the Authority is
dependent on continued funding from the City. The condensed financial
information of the Authority has not been reproduced in this report, but is available
upon request from the Authority by emailing pvtransit(c�palosverdes.com or mailing
a request to P.O. Box 2656, Palos Verdes Peninsula, CA 90274.
See independent auditors' report.
45
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
B. Description of Funds
The accounts of the City are organized on the basis of funds, each of which is
considered a separate accounting entity. The operations of each fund are
accounted for with a separate set of self -balancing accounts that comprise its
assets, liabilities, fund equity, revenues, and expenditures. The following are types
of funds used:
Governmental Fund Types
• General Fund — Used to account for all financial resources except those that are
required to be accounted for in another fund.
• Special Revenue Funds — Used to account for the proceeds of specific revenue
sources that are restricted by law or administrative action for specified purposes.
• Debt Service Fund — The debt service fund of the former Redevelopment Agency
is used to account for property tax increment revenue and related interest income.
Disbursements from this fund consist mainly of principal and interest on
indebtedness.
• Capital Projects Funds — Used to account for financial resources used for the
construction of specific capital projects.
• Permanent Funds — Used to account for resources legally restricted to the extent
that only earnings, and not principal, may be used for purposes that support the
reporting government's programs.
Proprietary Fund Types
• Enterprise Fund — Used to finance and account for the acquisition, operation, and
maintenance of the City's facilities and services; which are supported primarily by
user charges.
• Internal Service Funds — Used to account for employee benefits costs and
purchases and maintenance of equipment on behalf of all City departments, as
well as the accumulation of funds for replacement of certain buildings on behalf of
the City.
Fiduciary Fund Type
• Private -Purpose Trust Fund — Used to account for property tax revenue allocated
to the Successor Agency and payments of the obligations of the former
Redevelopment Agency.
See independent auditors' report.
46
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
C. Basis of Accountina/Measurement Focus
Government — Wide Financial Statements
The City's Government -Wide Financial Statements include a "Statement of Net
Assets" and a "Statement of Activities". These two statements present summaries
of Governmental Activities for the City.
These 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, infrastructure, and long-term debt, are included
in the accompanying Statement of Net Assets. The Statement of Activities
presents changes in net assets. 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 liability is incurred. The Statement of
Activities demonstrates the degree to which the direct expenses of a given function
are offset by program revenues. Direct expenses are those that are clearly
identifiable with a specific function. Program revenue transactions for the City are
reported in three categories: 1) Charges for Services, 2) Operating Grants and
Contributions, and 3) Capital Grants and Contributions. Charges for Services
include revenues from customers or applicants who purchase, use, or directly
benefit from goods, services, or privileges provided by a given function. Operating
Grants and Contributions include revenues restricted to meeting the requirements
of a particular operating function and may include state shared revenues and
grants. Capital Grants and Contributions include revenues restricted to meeting the
requirements of a particular capital function and may include grants and developer
fees. Taxes and other items not properly included among program revenues are
reported instead as general revenues. As a general rule, the effect of interfund
activity has been eliminated from the Government -Wide Financial Statements.
Governmental Fund Financial Statements
Governmental fund financial statements include a "Balance Sheet — Governmental
Funds" and "Statement of Revenues, Expenditures, and Changes in Fund
Balances — Governmental Funds" for all major and other governmental funds. An
accompanying schedule is presented to reconcile and explain the differences in
fund balances as presented in these statements to the Net Assets presented in the
Government -Wide Financial Statements. The City has presented all major funds
that met qualifications of GASB Statement No. 34. In addition, the City has
presented the Street Maintenance Special Revenue Fund as a major fund because
the City believes the financial position and activities of this fund are significant to
the City as a whole.
See independent auditors' report.
47
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
All governmental funds are accounted for on a spending or "current financial
resources" measurement focus and the modified accrual basis of accounting.
Under the "current financial resources" measurement focus, generally only current
assets and current liabilities are reported 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 fund balances. Revenues are recognized in the accounting
period in which they become susceptible to accrual, that is, when they become
both measurable and available to finance expenditures of the current period.
"Measurable" means that the amount of the transaction can be determined, and
"available" means collectible within the current period or soon enough thereafter to
be used to pay liabilities of the current period. Accrued revenues include property
taxes received within 60 days after year-end, taxpayer -assessed taxes such as
sales taxes, and earnings on investments. Grant funds earned but not received are
recorded as a receivable, and grant funds received before the revenue recognition
criteria have been met are reported as deferred revenues. Expenditures are
recorded when the fund liability is incurred, if measurable, except for immature
interest on general long-term debt, which is recognized when due.
The City reports the following major governmental funds
The General Fund is the City's primary operating fund. It accounts for all financial
resources of the City, except those that are required to be accounted for in another
fund.
The Street Maintenance Special Revenue Fund is used to account for state -shared
highway users tax used for street maintenance, right-of-way acquisition and street
construction.
The City's Affordable Housing Fund is used to account for developer fees in lieu of
providing affordable housing with new development, as well as affordable housing
assets that were transferred from the former Redevelopment Agency to the City as
a result of the City's election to retain the housing assets and function of the former
Redevelopment Agency pursuant to state law related to redevelopment dissolution.
The Capital Improvement Capital Projects Fund is used to account for funds used
for the City's capital improvement projects.
Proprietary Fund Financial Statements
Proprietary fund types are accounted for using the "economic resources"
measurement focus and accrual basis of accounting. This means that all assets
and liabilities (whether current or non-current) associated with the activity are
included on the balance sheet. Fund equity is presented as total net assets. The
See independent auditors' report.
48
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
operating statement of proprietary funds presents increases (revenues) and
decreases (expenses) in total net assets. Revenues are recognized when they are
earned and expenses are recognized when the liability is incurred.
Proprietary funds distinguish operating revenues and expenses from non-operating
items. Operating revenues and expenses generally result from providing services
and producing and delivering goods in connection with a proprietary fund's
principal ongoing operations. The principal operating revenues of the City's
enterprise and internal service funds are charges for services. Operating expenses
for the enterprise and internal service funds include the costs of services,
employee benefits, maintenance of capital assets, and depreciation on capital
assets. All revenues and expenses not meeting this definition are reported as non-
operating revenues and expenses.
The City uses the internal service funds to finance and account for goods and
services provided by one City department to other City departments, including the
purchase and maintenance of equipment, replacement of buildings and payment of
employee benefits. The City's internal service funds are presented in the
proprietary funds financial statements. Because the principal users of the internal
services are the City's governmental activities, the financial statements of the
internal service funds are consolidated into the governmental column when
presented in the government -wide financial statements. To the extent possible,
the cost of these services is reported in the appropriate functional activity
(administration, public safety, public works, etc.).
The City reports the following major enterprise fund
The Water Quality Flood Protection Fund is used to account for voter approved
storm drain user fees used to repair and replace the City's storm drain facilities.
Fiduciary Fund Financial Statements
The fiduciary private -purpose trust fund type is accounted for using the economic
resources measurement focus and accrual basis of accounting similar to the
proprietary funds.
The City reports the following fiduciary fund
The assets and liabilities of the former Redevelopment Agency were transferred to
the Successor Agency as part of the business of redevelopment dissolution. The
Successor Agency private -purpose trust fund will account for the changes in the
former Redevelopment Agency's assets and liabilities until they are disposed of
through dissolution. This fund also accounts for the administrative costs
associated with dissolution.
See independent auditors' report.
49
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
D. Budgetary Accounting
Annual budgets are adopted on a basis consistent with accounting principles
generally accepted in the United States of America for all governmental funds. All
annual appropriations lapse at fiscal year-end. Budget control is maintained over
all accounts, and expenditures are not allowed to exceed appropriations at the
program level. Throughout the year, the City Council made several supplementing
budgetary adjustments to the General fund, Special Revenue funds, Capital
Projects funds, Proprietary funds and Permanent funds. These adjustments
resulted in a net appropriation increase in the amount of $1,062,220. This increase
was primarily a result of appropriations continued from FY11-12 with City Council
approval.
Under Article XIIIB of the California Constitution (the Gann Spending Limitation
Initiative), the City is restricted as to the amount of annual appropriations from the
proceeds of taxes, and if proceeds of taxes exceed allowed appropriations, the
excess must either be refunded to the State Controller, returned to the taxpayers
through revised tax rates or revised fee schedules, or an excess in one year may
be offset against a deficit in the following year. For the fiscal year ended June 30,
2012, based on calculations by City Management, proceeds of taxes did not
exceed related appropriations.
E. Capital Assets
Capital assets include land, machinery and equipment (vehicles, computers, etc.),
buildings and improvements, and infrastructure assets (street systems, storm
drains, sewer systems, etc.). Capital assets are defined by the City as all land and
buildings, vehicles, computers and equipment with an initial individual cost of more
than $5,000; and improvements and infrastructure assets with costs of more than
$100,000. Such assets are recorded at historical cost or estimated historical cost if
purchased or constructed. Donated or annexed capital assets are recorded at
estimated market value at the date of donation or annexation.
The costs of normal maintenance and repairs that do not add to the value of the
asset or materially extend assets lives are not capitalized. Depreciation is recorded
in the Government -Wide Financial Statements on a straight-line basis over the
useful life of the assets as follows:
Buildings and Improvements
Vehicles, Computers, and Equipment
Infrastructure Assets
Roadway Network
Sewer Network
Storm Drain Network
See independent auditors' report.
50
25 to 50 years
3 to 10 years
10 to 100 years
25 to 50 years
30 to 100 years
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Parks and Recreation Network 25 years
F. Employee Compensated Absences
City employees may receive from 10 to 20 days vacation time each year,
depending upon length of service. An employee may accumulate earned vacation
time up to a maximum of two years' worth of accrued vacation leave. Upon
termination, employees are paid the full value of their unused vacation time at their
existing salary.
City employees accrue 96 hours of sick leave each year with a maximum accrual
of 720 hours. However, unused sick leave is never paid out to the employee; and
therefore, the City does not accrue a liability.
The General Fund will primarily be used to liquidate the liability for compensated
absences in future years. Any liability for compensated absences is only carried in
the General Fund if there is unused/unpaid leave outstanding following an
employee's separation.
G. Investments
Investments are stated at fair value (quoted market price of the best available
estimate, thereof).
H. Cash and Cash Equivalents
The Water Quality Flood Protection Enterprise Fund and the Internal Service
Funds participate in the pooling of City-wide cash and investments. Amounts from
the pool are available to these funds on demand. Therefore the cash and
investments reported in these funds are considered to be cash and cash
equivalents for purpose of the statement of cash flows. The City has no non-cash
investing, capital, or financing activities to be reported on the statement of cash
flows.
I. Claims and Judgments
When it is probable that a claim liability has been incurred, and the amount of the
loss can be reasonably estimated, the City records the estimated loss, net of any
insurance coverage under its self-insurance program. Small claims and judgments
are recorded as expenditures when paid.
The City's self-insurance program is administered through the California Joint
Powers Authority (the CJPIA), which is described at Note #8. The CJPIA is a public
entity risk pool, which is accounted for under the provisions of GASB Statement
See independent auditors' report.
51
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
10. Claim losses recorded in the CJPIA include both current claims and "Incurred
but Not Reported" (IBNR) claims. The City records amounts deposited with CJPIA
as insurance expenditures in the General Fund when paid. These deposits are
subject to retrospective adjustment. Favorable claims experience result in a refund
of deposits from the CJPIA and such refunds, if any, are recorded as a reduction of
insurance expenditures. Adverse claims experience result in the payment of
additional deposits and such deposits, if any, are recorded as insurance
expenditures when paid.
J. Prepaid Items
Certain payments to vendors reflect costs applicable to future accounting periods
and are recorded as prepaid items using the consumption method. In
governmental funds, the prepaid assets recorded do not reflect current
appropriable resources and thus, an equivalent portion of fund balance is reported
as nonspendable. The City had a total of $1,007,946 ($716,873 in governmental
funds and $291,073 in internal service funds) of prepaid items as of June 30, 2012.
K. Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect certain reported amounts and disclosures.
Accordingly, actual results could differ from those estimates.
L. Use of Restricted Resources
When both restricted and unrestricted resources are available for use, it is the
City's policy to use restricted resources first. When unrestricted resources
(committed, assigned or unassigned) are available for use, it is the City's policy to
use committed resources first, assigned resources second and finally unassigned
resources.
NOTE #2 — CASH AND INVESTMENTS
Cash and investments as of June 30, 2012, are classified in the accompanying
financial statements as follows:
Government -Wide Fiduciary Fund
Statement of Statement of Fiduciary
Net Assets Net Assets Total
Total cash and investments $ 47,407,782 $ 625,260 $ 48,033,042
See independent auditors' report.
52
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Cash and investments as of June 30, 2012 consist of the following:
Petty Cash $ 2,500
Deposits with Financial Institution 4,778,629
Local Agency Investment Fund (LAIF) 43.251.913
Total cash and investments $ 48.033.042
Investments Authorized by the California Government Code and the City of
Rancho Palos Verdes' Investment Policy
The table below identifies the investment types that are authorized for the City of
Rancho Palos Verdes by the California Government Code (or the City's investment
policy, where more restrictive). The table also identifies certain provisions of the
California Government Code (or the City's investment policy, where more
restrictive) that address interest rate risk, credit risk, and concentration of credit
risk
Maximum
Amount or Maximum
Maximum Percent of in One
Authorized Investment Type Maturity Portfolio Issuer
U.S. Treasury Obligations 3 years None None
Negotiable Certificates of Deposit 5 years 30% None
Repurchase Agreements 7 days 15% None
Money Market Mutual Funds N/A 15% 15%
Local Agency Investment Fund (LAIF) N/A None None
Money Market Savings/Demand Deposits N/A $5 million 15%
Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely
affect the fair value of an investment. Generally, the longer the maturity of an
investment, there is a greater sensitivity of its fair value to changes in market
interest rates. The City manages its exposure to interest rate risk by investing with
the Local Agency Investment Fund (LAIF) such that the portfolio provides cash
flows and liquidity need for operations. The City's investment is represented by
shares in the pool, which can be withdrawn in one business day. The average
maturity of the pool is less than one year.
Investment Type
Local Agency Investment Fund (LAIF)
See independent auditors' report.
53
Remaining
Maturity
12 Months
or Less
$ 43,251,913
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its
obligation to the holder of the investment. This is measured by the assignment of a
rating by a nationally recognized statistical rating organization. The City's LAIF
investment is not rated.
Concentration of Credit Risk
The investment policy of the City of Rancho Palos Verdes contains no limitations
on the amount that can be invested in any one issuer beyond that stipulated by the
California Government Code. As of June 30, 2012, the City's investments in LAIF
were exempt from concentration of credit risk disclosure.
Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a
depository financial institution, a government will not be able to recover its deposits
or will not be able to recover collateral securities that are in the possession of an
outside party. The custodial credit risk for investments is the risk that, in the event
of the failure of the counterparty (e.g., broker-dealer) to a transaction, a
government will not be able to recover the value of its investment or collateral
securities that are in the possession of another party. The California Government
Code and the City of Rancho Palos Verdes' investment policy do not contain legal
or policy requirements that would limit the exposure to custodial credit risk for
deposits or investments, other than the following provision for deposits: The
California Government Code requires that a financial institution secure deposits
made by state or local governmental units by pledging securities in an undivided
collateral pool held by a depository regulated under state law (unless so waived by
the governmental unit). The market value of the pledged securities in the collateral
pool must equal at least 110 percent of the total amount deposited by the public
agencies. California law also allows financial institutions to secure City deposits by
pledging first trust deed mortgage notes having a value of 150 percent of the
secured public deposits.
The City's deposits with financial institution are non-interest bearing bank accounts
that are fully insured by the Federal Deposit Insurance Corporation (FDIC).
Investment in Local Agency Investment Fund (LAIF)
The City of Rancho Palos Verdes is a voluntary participant in LAIF that is regulated
by California Government Code Section 16429 under the oversight of the
Treasurer of the State of California. The fair value of the City of Rancho Palos
Verdes' investment in this pool is based upon the City of Rancho Palos Verdes'
See independent auditors' report.
54
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
pro -rata share of the fair value provided by LAIF for the entire pool portfolio (in
relation to the amortized cost of that portfolio). The balance available for
withdrawal is based on the accounting records maintained by LAIF, which are
recorded on an amortized cost basis.
LAIF is a governmental investment pool managed and directed by the Treasurer of
the State of California and is not registered with the Securities and Exchange
Commission. An oversight committee comprised of California State officials and
various other participants provides oversight to the management of the fund. The
daily operations and responsibilities of LAIF fall under the auspices of the State
Treasurer's office. The City is a voluntary participant in the investment pool.
NOTE #3 — INTERFUND TRANSACTIONS
Inter -fund balances consisted of the following at June 30, 2012:
1 Due To I
General
Fund
u -
Other Governmental Funds $ 151,665
Internal Service Funds 118,514
0 Total: $ 270,179
General fund cash was used to cover grant expenditures in the other
Governmental Funds until reimbursement is received from the grant agencies.
General fund cash was also used to cover July 2012 payments for employee
benefits made in June 2012.
Inter -fund Transfers
Inter -fund transfers for the year ended June 30, 2012, consisted of the following:
ITransfer To
Transfer From
Street Other Internal
General Maintenance Governmental Service
Fund Fund Funds Funds Totals
General Fund $ - $ $ 200,000 $ 340,000 $ 540,000
Street Maintenance - 945,088 - 945,088
Capital Improvement Projects 5,472,272 52,661 965,022 30,517 6,520,472
Other Governmental Funds 220,700 - - - 220,700
Totals: $5,692,972 $ 52,661 $ 2,110,110 $ 370,517 $ 8,226,260
Transfers are used to: 1) move revenues from the fund that statute or budget
requires for collection to the fund that statute or budget requires for expenditure; 2)
See independent auditors' report.
55
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
use unrestricted revenues collected in the General Fund to finance various
programs accounted for in other funds in accordance with budgetary authorizations
or grant matching requirements; 3) return money that was originally transferred
from the General Fund to another fund, yet not used.
NOTE #4 — CAPITAL ASSETS AND DEPRECIATION
In accordance with GASB Statement No. 34, the City has reported all capital
assets including infrastructure in the Government -Wide Statement of Net Assets.
The City elected to use the basic reporting approach as defined by GASB
Statement No. 34 for all infrastructures, whereby depreciation expense and
accumulated depreciation has been recorded. The following tables present the
capital assets activity for the year ended June 30, 2012.
Beginning Ending
Governmental Activities Balance Increases Decreases Balance
Capital assets not being depreciated:
Land 40,048,288 - (166,296) 39,881,992
Construction in progress 628,308 2,864,926 (3,063,178) 430,056
Total capital assets not being depreciated 40,676,596 2,864,926 (3,229,474) 40,312,048
Capital assets being depreciated:
Building and improvements 9,379,539 - 9,379,539
Vehicles 295,618 6,301 301,919
Computer equipment 599,397 128,336 727,733
Furniture, fixtures and equipment 573,860 - 573,860
Infrastructure - -
Roadway system 88,140,550 2,577,038 90,717,588
Sewer system 25,755,463 210,532 25,965,995
Storm drain system 13,148,416 - 13,148,416
Parks system 6,702,324 275,608 6,977,932
Total capital assets being depreciated 144,595,167 3,197,815 147,792,982
Less accumulated depreciation for:
Buildings and improvements (2,223,243) (203,170) (2,426,413)
Vehicles (200,962) (42,552) (243,514)
Computer equipment (564,215) (45,749) (609,964)
Furniture, fixtures and equipment (449,999) (45,184) (495,183)
Infrastructure -
Roadway system (41,836,351) (2,432,938) (44,269,289)
Sewer system (17,307,988) (459,320) (17,767,308)
Storm drain system (2,967,475) (250,479) (3,217,954)
Parks system (4,576,448) (10,526) (4,586,974)
Total accumulated depreciation (70,126,681) (3,489,918) (73,616,599)
Total capital assets being depreciated, net 74,468,486 (292,103) 74,176,383
Governmental activities capital assets, net 115,145,082 2,572,823 (3,229,474) 114,488,431
See independent auditors' report.
56
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Land carried at $166,296 was transferred to the Successor Agency upon
dissolution of the Redevelopment Agency on January 31, 2012 (see Note #14).
Depreciation expense was charged to functions/programs of the primary
government as follows:
Administration (depreciation of buildings)
Public Works (depreciation of roadways, sewers, and storm drains)
Recreation Services (depreciation of parks system)
Capital assets held by the City's internal service funds are charged
to the various functions based on their usage of the assets
Total Depreciation Expense — Governmental Activities
Business -type Activities
Capital assets not being depreciated:
Land
Construction in progress
Total capital assets not being depreciated
Capital assets being depreciated:
Equipment
Storm drain system
Total capital assets being depreciated
Less accumulated depreciation for:
Equipment
Storm drain system
Total accumulated depreciation
Total capital assets being depreciated, net
Business -type activities capital assets, net
Depreciation expense of $234,354
Protection enterprise fund.
Beginning
Balance
1,408,493
678,980
2,087,473
11,813
11, 338, 573
11, 350, 386
(10,632)
(674, 558)
(685,190)
10,665,196
12,752,669
$ 203,170
3,142,737
10,526
133,485
$3.489.918
Ending
Increases Decreases Balance
837,944
837,944
(1,181)
(233,173)
(234,354)
(234,354)
603,590
is included in the Water
NOTE #5 — LONG-TERM NOTES RECEIVABLE
Special Revenue Funds:
Affordable Housing
Community Development Block Grant
See independent auditors' report.
Total Long -Term
Notes Receivable
$ 6,829,457
$ 479,024
$ 7,308,481
57
1,408,493
1,516,924
2,925,417
11,813
11, 338, 573
11, 350, 386
(11,813)
(907, 731)
(919,544)
10,430,842
13,356,259
Quality Flood
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Affordable Housing.
In March 2009, the former Redevelopment Agency (RDA) entered into a
Disposition and Development Agreement (DDA) with AMCAL Mirandela Fund LP
(AMCAL). Under the DDA, the former RDA provided financial assistance to
AMCAL in an amount up to $6,790,000 to develop a thirty-four unit senior housing
project. The loan accrues simple interest at a rate of 3% per annum on the
amounts disbursed. The balance of notes receivable from AMCAL including
accrued unpaid interest of $432,593 at June 30, 2012 was $6,703,137.
In March 2011, the former RDA sold an affordable housing condominium to an
individual for $350,000 in connection with the sale the former RDA took back a
secured promissory note from the buyer in the amount of $126,320. The note
bears no interest and principal is payable upon default by the owner (or any
successors' owner) under a regulatory agreement that requires the condominium
to be occupied by person or families of moderate income. If no such default has
occurred by February 22, 2056, the principal will be forgiven. As a result of the
nature of these terms, the balance of this note has been offset by deferred revenue
in the governmental fund financial statements.
As part of redevelopment dissolution, these two long-term notes receivable were
transferred to the City, which elected to retain the housing assets and function of
the former Redevelopment Agency (see Note #14).
Community Development Block Grant (CDBG)
As part of the City's CDBG program, the City extends loans to property owners
meeting low and moderate income requirements to make repairs and
improvements to their homes. These notes receivable bear no interest, and
repayment is required when the title to the property is transferred or the property is
re -financed. The maximum loan amount per property is $13,000. Amounts repaid
are returned to the CDBG program. The total of these loans outstanding at June
30, 2012 is $479,024.
NOTE #6 — LONG-TERM DEBT
RDA Tax Increment Bond
RDA Deferred Interest Payable
Employee Compensated Absences
Totals
Balance
July 1, 2011 Additions
$5,165,000
798,601
332,600 271,804
'$ 6,296,201 $ 271,804
See independent auditors' report.
58
Balance
Deletions June 30, 2012
$ (5,165,000) $ -
(798,601) -
(233,605) 370,799
$ (6,197,206) $ 370,799
Amount Due
in One Year
$ -
260,435
$ 260,435
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Employee Compensated Absences
There is no fixed payment schedule for employee compensated absences. Based
on historical trends, $260,434 estimated to be the amount that will be used and/or
paid out during fiscal year 2012-13.
RDA Tax Increment Bond and Deferred Interest Payable
Upon dissolution of the Redevelopment Agency on January 31, 2012, the debt of
the former RDA was transferred to the Successor Agency (see Note #14). The
transferred debt included a Tax Increment Bond in the amount of $5,065,000 and
Deferred Interest Payable in the amount of $434,904 at January 31, 2012.
NOTE #7 — CLASSIFICATIONS OF NET ASSETS AND FUND BALANCE
Government -Wide Financial Statements
In the Government -Wide financial statements net assets are classified in the
following categories:
Invested in Capital Assets, Net of Related Debt
This category groups all capital assets, including infrastructure, into one
component of net assets. Accumulated depreciation on these assets reduces this
category as does any outstanding balance on debt incurred in acquiring or
constructing the capital assets. As of June 30, 2012, the City had no debt related
to capital assets.
Restricted Net Assets
This category presents external restrictions imposed by creditors, grantors,
contributions or laws or regulations of other governments and restrictions imposed
by law through constitutional provisions or enabling legislation.
Unrestricted Net Assets
This category represents the net assets of the City that are not externally restricted
for any project or other purpose.
Fund Financial Statements
The fund balances reported on the fund statements consist of the following
categories:
See independent auditors' report.
59
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Nonspendable — Amounts that are not in a spendable form (such as inventory and
prepaid expenditures) or are legally required to be maintained intact (such as the
corpus of an endowment fund).
Restricted — Amounts constrained to specific purposes by their providers (such as
grantors, bondholders, and higher levels of government), through constitutional
provisions, or by enabling legislation.
Committed — Amounts constrained to specific purposes by the City Council via a
City Council resolution. To be reported as Committed, amounts cannot be used for
any other purpose unless the City Council adopts another resolution to remove or
change the constraint. The City Council has not committed fund balances as of
June 30, 2012.
Assigned — Amounts the City Council intends to use for a specific purpose, which
is expressed by the City Council via minute order. The City Council has assigned
the entire fund balance of the Capital Improvement Projects fund for the future
design and construction of infrastructure improvement projects.
Unassigned — Amounts that are available for any purpose; these amounts are
reported only in the General Fund. However, if there is a deficit fund balance to be
reported in any fund, it is classified as Unassigned.
The City's governmental fund balances were classified as follows at June 30,
2012:
Street Affordable Capital Other
General Maintenance Housing Improvement Governmental
Fund Fund Fund Fund Funds
Nonspendable:
In Form (e.g. inventory, prepaid amounts) $ 7,492,810 $ - $ 2,990,899 $ - $
Legally (e.g. endowments) - - - - 1,824,696
Restricted - 1,056,896 500,290 - 6,856,223
Committed - - -
Assigned - - 15,406,941
Unassigned:
Rainy Day Fund 11,775,937
Continued Appropriations 688,502
Deficit Fund Balance - - - (108,132)
Governmental Fund Balance Totals $19,957,249 $ 1,056,896 $ 3,491,189 $ 15,406,941 $ 8,572,787
Minimum Fund Balance Policies
The City Council has adopted a policy, via resolution, to maintain the following
minimum fund balances:
See independent auditors' report.
60
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
➢ Rainy Day Fund — At least fifty percent of annual operating expenditures in
the General Fund;
➢ Capital Improvement Fund — A minimum of $3 million for infrastructure
improvement projects;
➢ Street Maintenance Fund — A minimum of one year's appropriations for road
maintenance on Palos Verdes Drive South in the landslide area; and
➢ Habitat Restoration Fund — A minimum of $50,000 for emergency use for
habitat restoration purposes.
Special Revenue Funds
Fund balances are non -spendable or restricted in the special revenue funds for the
following purposes:
(Fund
Street Maintenance
Affordable Housing
Air Quality Management
IEI Prado
Proposition A
(Proposition C
Measure R
Beautification
IWaste Reduction
Public Safety Grants
11972 Act Landscaping
& Lighting District
11911 Act Lighting
District
Purpose
Maintain the City's right of way,
which includes both pavement and
roadside maintenance
Implement goals, policies and
programs outlined in the Housing
Element of the City's General Plan
vehicles
Maintain the common area of the
El Prado neighborhood
Public transportation
Public transit and related services
Transportation needs, including
maintenance of arterial streets,
traffic control, bikeway and
pedestrian improvements, and
public transit
Right of way beautification,
neighborhood beautification
grants, and promote recycling
State mandated waste reduction
and recycling plans and programs
Law enforcement and public safety
equipment
Maintain right of way landscaping
and lighting
Maintain right of way lighting and
traffic signals
See independent auditors' report.
61
Revenue Source
Highway Users' Tax and
other transfers of other
restricted funding (e.g.
Landscaping & Lighting
District Assessments) $
Amount
Developer fees
AB2766 fees
Property assessments
Special sales tax
Special sales tax
Special sales tax $
Recycling fees and
grants $
AB939 fees from waste
haulers $
Federal and state
grants and shared $
Property assessments $
Property assessments $
1,056,896
Non -Spendable
$2,990,899
Restricted $500,290
101,187
16,774
170,421
1,341,811
391,926
1,065,483
268,961
20,188
78,079
1,670,384
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(Continued:
(Fund
Improvement Authority
Portuguese Bend
Habitat Restoration
'Abalone Cove Sewer
District
Dr. Allen and Charlotte
Ginsburg Cultural Arts
Building
'Donor Restricted
Contributions
Bikeways
Environmental Excise
Tax
(Quimby
Purpose
Maintain landslide abatement
improvements in the Portuguese
Bend project area
Restore habitat on City owned
property
Maintain and operate the Abalone
Cove sewer system
Construction of a building to be
used for dancing or other cultural
activities, or for the purchase of
open space for habitat
conservation and passive
recreational purposes
Acquire or construct recreational
facilities
Design and construction of bicycle
and pedestrian facilities on
roadways, including disable
access ramps
Purchase land, construct facilities,
or purchase equipment to develop,
improve and expand parks,
services, utilities and public safety
Develop or rehabilitate park and
recreational facilities
Capital Project Funds
Revenue Source Amount
General fund transfers
pursuant to the
provisions of a
reimbursement and
settlement agreement
with the County of Los
Angeles $ 309,724
Non -Spendable $74,696
Developer fees Restricted $146,345
Property assessments $
Private donation
Private donations
Transportation
Development Act Article
3
Local tax on new
construction
Developer fees $
Fund balances are restricted or assigned for the following:
Fund
Capital Improvement
Projects
Permanent Funds
Fund balances are considered non -spendable or restricted for the following:
39,271
158,480
406,809
61
414,525
29,421
Purpose Amount
Assigned for design, construction & inspection of City
infrastructure projects, including roadways, storm
drains, and park facilities $ 15,406,941
See independent auditors' report.
62
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Fund Purpose Amount
The interest earned on this fund balance is used
to maintain trails and open space dedicated to
the City by the developer of the Oceanfront
Estates tract of homes. The Non -Spendable
Subregion One portion of this fund balance must be maintained Non -Spendable $750,000
Maintenance per the development agreement with the City. Restricted $23,559
The interest earned on this fund balance is used
to maintain infrastructure constructed by the
Redevelopment Agency in the Abalone Cove
area of the Redevelopment Agency's Project
Area. The Non -Spendable portion of the fund
Improvement Authority balance must be maintained pursuant to a Non -Spendable $1,000,000
Abalone Cove Reimbrusement & Settlement Agreement. Restricted $202,814
NOTE #8 — PENSION AND RETIREMENT HEALTH SAVINGS PLANS
Pension Plan Description
The City provides a defined benefit pension plan that includes retirement and
disability benefits, annual cost -of -living adjustments, and death benefits to plan
members and beneficiaries. The City contracts with the California Public
Employee's Retirement System (CaIPERS), a cost-sharing, multi-employer public
employee defined benefit pension plan administered by CaIPERS. CaIPERS
provides retirement and disability benefits, annual cost -of -living adjustments, and
death benefits to plan members and beneficiaries. State statutes, within the Public
Employees' Retirement Law, establish benefit provisions and other requirements.
The City selects optional benefit provisions from the benefit menu by contract with
CaIPERS and adopts those benefits through local ordinance. Copies of the
CaIPERS annual financial report may be obtained from the CaIPERS Executive
Office at 400 P Street, Sacramento, California 95814 or downloaded from their
website at www.calpers.gov.
Pursuant to City Council action on October 2, 2012 to reduce pension benefits for
future employees and the California Public Employees' Pension Reform Act of
2012, the City will have 3 tiers of defined pension benefits. For employees hired
prior to October 2, 2012, the City participates in a Miscellaneous 2.5% at 55 Risk
Pool (1st Tier). For employees hired after October 2, 2012 but before January 1,
2013 and employees hired after January 1, 2013 that have participated in a
reciprocating California public employee pension plan within six months of being
hired by the City, the City participates in a Miscellaneous 2% at 60 Risk Pool (2nd
Tier). For all other employees hired after January 1, 2013, the City will participate
in a Miscellaneous 2% at 62 Risk Pool (3rd Tier).
See independent auditors' report.
63
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Pension Plan Funding Policy
The contribution requirements of plan members are established by State statute
and the employer contribution rate is established and amended by CaIPERS.
During fiscal year 2011-12, the City's employees participated in only the 1st Tier of
benefits as described above. Active City employees were required to contribute
8% of their annual covered salary beginning in September 2011. The City is
required to contribute the actuarially determined remaining amounts necessary to
fund the benefits for its members. The fiscal year 2011-12 rate for the City's
contribution was 13.353% of covered payroll.
As a result of having less than 100 active members as of June 30, 2003, the City
was required to participate in a risk pool. The City's pooled employer contribution
rate is the same as the stand-alone employer contribution rate. At the time of
joining the mandatory pooled plan, CaIPERS established an employer side fund to
account for the difference between the funded status of the pooled plan and the
funded status of the City's plan. The City paid off its side fund liability in fiscal year
2009-10. The funded status of the 1st Tier Risk Pool at June 30, 2011 was 72.3%.
The risk pool's unfunded actuarial accrued liability at June 30, 2011 was
$293,320,030. The City's share of the risk pool's unfunded actuarial accrued
liability, as reported by CaIPERS, is $3,714,970. Currently, the City's share of the
Risk Pool's liability is not a reportable liability of the City. However, with
implementation of GASB Statement No. 68 expected with the June 30, 2015
financial statements, the City's share of the Risk Pool's liability will be a reportable
liability of the City.
The City's contributions to CaIPERS for the most recent three years follow.
City Pay-off Total
Year Ended Contribution Side Fund Liability City Cost
June 30, 2012 $ 658,481 $ - $ 658,481
June 30, 2011 $ 461,416 $ - $ 461,416
June 30, 2010 $ 521,408 $ 1,661,376 $2,182,784
Retirement Health Savings Plan
On November 17, 2009, the City approved the establishment of a defined
contribution Retirement Health Savings Plan (the "Plan") for its full-time
employees. The Plan is a Health Reimbursement Arrangement ("HRA") within
Sections 105 and 106 of the Internal Revenue Code. The Plan assets are
managed in a non-taxable trust as described in Section 501(c)(9) of the Internal
Revenue Code. The City is the Plan Administrator, and utilizes the services of a
contracted financial services provider for day-to-day administration of contributions
See independent auditors' report.
64
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
and disbursements. The City has the authority to amend the Plan's provisions and
contribution requirements.
The City has no obligation to make contributions to the Plan, but as part of the
annual budget process the City may elect to make contributions to the Plan.
Employees are required to contribute 1% of their gross wages to their account,
which is owned by the employee. During fiscal year 2011-12, the City contributed
a total of $72,052 to employee accounts. During the same time, employees
contributed a total of $48,769 to their own accounts.
The Plan assets are not an asset of the City. Therefore, only the City's expense to
make contributions to the Plan has been recorded in the Employee Benefits
internal service fund in the City's financial statements.
NOTE #9 — LIABILITY, INSURED PROGRAMS AND WORKERS'
COMPENSATION PROTECTION
Description of Self -Insurance Pool Pursuant to Joint Powers Agreement
The City is a member of the California Joint Powers Insurance Authority
(Authority). The Authority is composed of 123 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 California JPIA 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.
Self -Insurance Programs of the CJPIA
Each member pays an annual contribution (formerly called the primary deposit) to
cover estimated losses for the coverage period. This initial funding is paid at the
beginning of the coverage period. After the close of the coverage period,
outstanding claims are valued. A retrospective deposit computation is then
conducted annually thereafter until all claims incurred during the coverage period
are closed on a pool -wide basis. This subsequent cost re -allocation among
members based on actual claim development can result in adjustments of either
refunds or additional deposits required.
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
See independent auditors' report.
65
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(claims) relative to other members of the risk -sharing pool. Additional information
regarding the cost allocation methodology is provided below.
General Liability
In the liability program claims are pooled separately between police and non -police
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 in excess of
$750,000 up to the reinsurance attachment point of $5 million are distributed based
on the outcome of cost allocation within the first and second loss layers. (5) Costs
of covered claims from $5 million to $10 million are paid under a reinsurance
contract subject to a $2.5 million annual aggregate deductible. Costs of covered
claims from $10 million to $15 million are paid under two reinsurance contracts
subject to a combined $3 million annual aggregate deductible. On a cumulative
basis for all 2011-12 reinsurance contracts the annual aggregate deductible is $5.5
million. (6) Costs of covered claims from $15 million up to $50 million are covered
through excess insurance policies.
The overall coverage limit for each member including all layers of coverage is $50
million per occurrence.
Costs of covered claims for subsidence losses are paid by reinsurance and excess
insurance with a pooled sub -limit of $35 million per occurrence. This $35 million
subsidence sub -limit is composed of (a) $5 million retained within the pool's SIR,
(b) $10 million in reinsurance and (c) $20 million in excess insurance. The excess
insurance layer has a $20 million annual aggregate.
Workers' Compensation
In the workers' compensation program claims are pooled separately between
public safety (police and fire) and non-public safety 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 layer of losses includes incurred costs from $50,000 to $100,000
for each occurrence and is evaluated as a percentage of the pool's total incurred
See independent auditors' report.
66
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
costs within the second layer. (4) Incurred costs in excess of $100,000 up to the
reinsurance attachment point of $2 million are distributed based on the outcome of
cost allocation within the first and second loss layers. (5) Costs of covered claims
from $2 million up to statutory limits are paid under a reinsurance policy.
Protection is provided per statutory liability under California Workers'
Compensation Law.
Employer's Liability losses are pooled among members to $2 million. Coverage
from $2 million to $5 million is purchased as part of a reinsurance policy, and
Employer's Liability losses from $5 million to $10 million are pooled among
members.
Purchased Insurance
Pollution Legal Liability Insurance
The City participates in the pollution legal liability insurance program (formerly
called environmental insurance) which is available through the Authority. The
policy covers sudden and gradual pollution of scheduled property, streets, and
storm drains owned by the City. Coverage is on a claims -made basis. There is a
$50,000 deductible. The Authority has a limit of $50 million for the 3 -year period
from July 1, 2011 through July 1, 2014. Each member of the Authority has a $10
million sub -limit during the 3 -year term of the policy.
Property Insurance
The City participates in the all-risk property protection program of the Authority.
This insurance protection is underwritten by several insurance companies. City
property is currently insured according to a schedule of covered property submitted
by the City to the Authority. City property currently has all-risk property insurance
protection in the amount of $14,505,855. There is a $5,000 deductible per
occurrence except for non -emergency vehicle insurance which has a $1,000
deductible. Premiums for the coverage are paid annually and are not subject to
retrospective adjustments.
Earthquake and Flood Insurance
The City purchases earthquake and flood insurance on a portion of its property.
The earthquake insurance is part of the property protection insurance program of
the Authority. City property currently has earthquake protection in the amount of
$14,406,823. There is a deductible of 5% per unit of value with a minimum
deductible of $100,000. Premiums for the coverage are paid annually and are not
subject to retrospective adjustments.
See independent auditors' report.
67
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Crime Insurance
The City purchases crime insurance coverage in the amount of $1,000,000 with a
$2,500 deductible. The fidelity coverage is provided through the Authority.
Premiums are paid annually and are not subject to retrospective adjustments.
Special Event Tenant User Liability Insurance
The City further protects against liability damages by requiring tenant users of
certain property to purchase low-cost tenant user liability insurance for certain
activities on agency property. The insurance premium is paid by the tenant user
and is paid to the City according to a schedule. The City then pays for the
insurance. The insurance is arranged by the Authority.
Adequacy of Protection
During the past three fiscal years, none of the above programs of protection
experienced settlements or judgments that exceeded pooled or insured coverage.
There were also no significant reductions in pooled or insured liability coverage in
2011-12.
NOTE #10 — CONTINGENCIES AND COMMITMENTS
Litiaation
In the normal course of operations, the City has been named as a defendant in
various claims and legal actions. Generally, unfavorable results of these claims
and legal actions are funded through the City's participation in California Joint
Powers Insurance Authority (CJPIA, see Note #8) and, as such, the City believes
that the ultimate liability for these legal actions and claims will not have a material
adverse effect on the City's financial statements. The City is also a defendant in
legal actions for which the potential losses would not be covered through
participation in CJPIA. The likelihood of an unfavorable outcome or the amount of
potential losses cannot be reasonably estimated by the City for these claims at this
time. In the event of an unfavorable outcome the losses would likely be material to
the City's financial statements.
Storm Drain Failures
During the winter storms of fiscal year 2004-05 citywide emergency repairs were
required, including those to repair sinkholes along Western Avenue. The City
received reimbursement from the Federal Emergency Management Agency
(FEMA) in the amount of approximately $1.2 million.
See independent auditors' report.
68
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
An audit by the Department of Homeland Security's Office of Inspector General
(OIG) indicated that the City may be compelled to return over $900,000 to FEMA.
However, in April 2012, FEMA rejected the OIG audit recommendations on the
grounds that the storm drains had functioned properly until the disastrous rain
events of 2004-05. The OIG has until June 22, 2015 to challenge FEMA's
rejection of the audit. The City's FEMA consultant has advised City Staff that the
OIG has never before challenged a FEMA rejection. Therefore, no liability to
return the FEMA funds has been accrued.
Building Moratorium
There is longstanding building moratorium in the landslide area of the City.
Several landowners with parcels in this area filed a lawsuit claiming an
unconstitutional taking of their property due to the building moratorium and the
City's adoption in 2002 of a safety standard that must be satisfied before
development could occur in this area. The landowners claim that the City has
made it impossible for them to satisfy the exception to the moratorium that would
allow development of the parcels.
Judgment was entered for the City after a three-month trial in the Superior Court.
However, the California Court of Appeal reversed the trial court's decision. The
landowners were seeking a trial on the issue of damages, which they assert
exceed $32 million. The parties negotiated a settlement, but the plaintiffs refused
to sign it, and subsequently rescinded their approval of the settlement. On October
21, 2011, the Superior Court entered judgment in favor of the City on all causes of
action. The plaintiffs filed an appeal from the judgment on November 4, 2011 and
the City awaits a hearing date from the Court of Appeal; however, as the City has
been processing development applications for the plaintiffs' lots as ordered by the
trial court, there is no expectation that the plaintiffs' appeal will be successful.
Therefore, no liability has been accrued.
NOTE #11 — PROPERTY TAXES
Under California law, property taxes are assessed and collected by the counties up
to one percent of assessed value, plus other increases approved by the voters.
The property taxes go into a pool, and are then allocated to the cities based on
complex formulas. Accordingly, the City accrues only those taxes, which are
received from the county within sixty days after year-end.
Lien date
Levy date
Due date
Collection dates
See independent auditors' report.
69
January 1
June 30
November 1 and February 1
December 10 and April 10
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
NOTE #12 — DEFERRED REVENUES
The deferred revenues in the fund financial statements of the City of Rancho Palos
Verdes as of June 30, 2012 consisted of the following:
General Fund:
Accrued Interest from Long -Term Advance to the former
Redevelopment Agency
Advance on Federal Grant
Revenue Earned but Not Available (beyond 60 days)
Other Governmental Funds:
Long -Term Note Receivable from AMCAL
Other Long -Term Note Receivable
Accrued Interest from AMCAL Loan
Long -Term Note Receivable Offset (loans expended when made)
Revenue Earned but Not Available (beyond 60 days)
Total Deferred Revenues:
NOTE #13 — OTHER REQUIRED FUND DISCLOSURES
12,546,283
100,830
81,038
3,633,706
126,320
79,431
479,024
184,206
17,230,838
The following funds had deficit fund balances as of June 30, 2012:
Other Governmental Funds:
Community Development Block Grant Fund
Measure A Special Revenue Fund
$ 42,447
$ 65,685
The City plans to finance the fund deficits through future revenues and transfers
from other funds.
NOTE #14 — SUCCESSOR AGENCY
On June 29, 2011, Assembly Bills 1x 26 (the "Dissolution Act") and 1x 27 were
enacted as part of the FY 2011-12 state budget package. The Dissolution Act
required each California redevelopment agency to suspend nearly all activities
except to implement existing contracts, meet already -incurred obligations, preserve
its assets and prepare for impending dissolution. Assembly Bill 1x 27 provided a
means for redevelopment agencies to continue to exist and operate by means of a
Voluntary Alternative Redevelopment Program.
The League of California Cities and the California Redevelopment Association
(CRA) filed a lawsuit on July 18, 2011 on behalf of cities, counties and
redevelopment agencies petitioning the California Supreme Court to overturn the
Dissolution Act and Assembly Bill 1x 27 on the grounds that these bills violate the
California Constitution.
See independent auditors' report.
70
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
On December 29, 2011, the California Supreme Court upheld the Dissolution Act
and struck down Assembly Bill 1x 27.
On June 27, 2012, as part of the FY 2012-13 state budget package, the
Legislature passed and the Governor signed AB 1484, which made technical and
substantive amendments to the Dissolution Act based on experience to -date at the
state and local level in implementing the Dissolution Act.
Under the Dissolution Act, each California redevelopment agency (each a
"Dissolved RDA") was dissolved as of February 1, 2012, and the sponsoring
community that formed the Dissolved RDA, together with other designated entities,
have initiated the process under the Dissolution Act to unwind the affairs of the
Dissolved RDA. A Successor Agency was created for each Dissolved RDA which
is the sponsoring community of the Dissolved RDA unless it elected not to serve as
the Successor Agency. On September 6, 2011, the City elected to serve as the
Successor Agency of the Rancho Palos Verdes Redevelopment Agency.
The Dissolution Act also created oversight boards which monitor the activities of
the successor agencies. The roles of the successor agencies and oversight boards
is to administer the wind down of each Dissolved RDA which includes making
payments due on enforceable obligations, disposing of the assets (other than
housing assets) and remitting the unencumbered balances of the Dissolved RDAs
to the County Auditor -Controller for distribution to the affected taxing entities.
The Dissolution Act allowed the sponsoring community that formed the Dissolved
RDA to elect to assume the housing functions and take over the certain housing
assets of the Dissolved RDA. If the sponsoring community does not elect to
become the Successor Housing Agency and assume the Dissolved RDA's housing
functions, such housing functions and all related housing assets will be transferred
to the local housing authority in the jurisdiction. AB 1484 modified and provided
some clarifications on the treatment of housing assets under the Dissolution Act.
The City elected on February 21, 2012 to serve as the Housing Successor Agency.
Prior to February 1, 2012, the final seven months of activity of the Dissolved RDA
are reported in the governmental funds of the City. After the date of dissolution, the
housing assets, obligations, and activities of the Dissolved RDA have been
transferred and are reported in a special revenue fund in the financial statements
of the City. All other assets, obligations, and activities of the Dissolved RDA have
been transferred and are reported in a fiduciary fund (private -purpose trust fund) in
the financial statements of the City.
The transfer of the assets and liabilities of the Dissolved RDA as of February 1,
2012 (except for certain assets of the former Low and Moderate Income Housing
Fund, which were transferred to the Affordable Housing Special Revenue
See independent auditors' report.
71
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Fund (effectively the same date as January 31, 2012) from the governmental funds
of the City to the fiduciary fund was reported in the governmental funds as an
extraordinary gain in the governmental fund financial statements. The receipt of
these assets and liabilities as of February 1, 2012 was also reported in the
fiduciary fund as an extraordinary loss.
Because of the different measurement focus of the governmental funds (current
financial resources measurement focus) and the measurement focus of the
fiduciary private -purpose trust fund (economic resources measurement focus), the
extraordinary gain recognized in the governmental funds was not the same amount
as the extraordinary loss that was recognized in the fiduciary fund financial
statements.
The difference between the extraordinary gain recognized in the fund financial
statements and the extraordinary loss recognized in the fiduciary fund financial
statements is reconciled as follows:
Total extraordinary gain reported in governmental funds - increase
to net assets of the Successor Agency Trust Fund $ (18,240,119)
Capital assets recorded in the government -wide financial
statements - increase to net assets of the Successor Agency
Trust Fund 166,296
Notes receivable reported in the government -wide financial
statements - increase to net assets of the Successor Agency
Trust Fund
Long term debt reported in the government -wide financial
statement - decrease to net assets of the Successor Agency
Trust Fund
Net decrease to net assets of the Successor Agency Trust Fund
as a result of initial transfers (equal to amount of extraordinary
gain reported in the government -wide financial statements of the
City)
225,785
(5,499,904)
$ (23,347,942)
The Dissolution Act and AB 1484 also establish roles for the County Auditor -
Controller, the California Department of Finance (the "DOF") and the California
State Controller's office in the dissolution process and the satisfaction of
enforceable obligations of the Dissolved RDAs.
The County Auditor -Controller is charged with establishing a Redevelopment
Property Tax Trust Fund (the "RPTTF") for each Successor Agency and depositing
into the RPTTF for each six-month period the amount of property taxes that would
See independent auditors' report.
72
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
have been redevelopment property tax increment had the Dissolved RDA not been
dissolved. The deposit in the RPTTF fund is to be used to pay to the Successor
Agency the amounts due on the Successor Agency's enforceable obligations for
the upcoming six-month period.
The Successor Agency is required to prepare a recognized obligation payment
schedule (the "ROPS") approved by the oversight board setting forth the amounts
due for each enforceable obligation during each six month period. The ROPS is
submitted to the DOF for approval. The County Auditor -Controller will make
payments to the Successor Agency from the RPTTF fund based on the ROPS
amount approved by the DOF. The ROPS is prepared in advance for the
enforceable obligations due over the next six months. The Successor Agency
received $118,818 from the County Auditor -Controller on June 1, 2012 for the
ROPS for the period July 1, 2012 to December 31, 2012.
The process of making RPTTF deposits to be used to pay enforceable obligations
of the Dissolved RDA will continue until all enforceable obligations have been paid
in full and all non -housing assets of the Dissolved RDA have been liquidated.
The State Controller of the State of California has been directed to review the
propriety of any transfers of assets between Dissolved RDA and other public
bodies that occurred after January 1, 2011. If the public body that received such
transfers is not contractually committed to a third party for the expenditure or
encumbrance of those assets, the State Controller is required to order the
available assets to be transferred to the public body designated as the successor
agency. The Dissolved RDA made only two transfers after January 1, 2011. One
transfer was the return of $500,000 in excess loan proceeds to the City that was
not needed to fund an affordable housing project. The other transfer involved
notes receivable totaling $6,751,633 that was given to the City in its capacity as
the successor housing agency to the Dissolved RDA.
Management believes, in consultation with legal counsel, that the obligations of the
Dissolved RDA due to the City are valid enforceable obligations payable by the
Successor Agency under the requirements of the Dissolution Act and AB 1484.
The City's position on this issue is not a position of settled law and there is
considerable legal uncertainty regarding this issue. It is reasonably possible that a
legal determination may be made at a later date by an appropriate judicial authority
that would resolve this issue unfavorably to the City.
Non -Liquid Assets
The following non -liquid assets are included in the records of the Successor
Agency:
See independent auditors' report.
73
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Note receivable from
Portuguese Bend Club Homeowners Association
Prepaid item
Land
Total Non -Liquid Assets
$204,950
182,195
166,296
$553.441
In 1999, the former Redevelopment Agency extended a $750,000 construction
loan to the Portuguese Bend Club Homeowners Association. The note is non-
interest bearing, and is to be repaid in 180 equal installments beginning in July
2001. The Association is scheduled to continue making monthly payments of
$4,167 through August 2016, and the balance of the note receivable at June 30,
2012 is $204,950.
Prior to redevelopment dissolution, the County of Los Angeles pursuant to a
Memorandum of Understanding dated November 1, 1997 (discussed below)
impounded property tax increment allocated to the former redevelopment agency
for payment of debt owed to the County. The balance of the impounded tax
increment which had not yet been applied to debt at June 30, 2012 is $182,195.
The former Redevelopment Agency owned a number of parcels in the landslide
area of the City. Parcels totaling approximately 177 acres which are identified as
Abalone Cove Shoreline Park and adjacent open space were transferred from the
County of Los Angeles at no cost. The remaining parcels which provide right-of-
way access into the landslide area were originally purchased at a total cost of
$166,296.
Debt Summary
Balance Transfers
February 1, 2012 from RDA
Due to City:
Consolidated Loan $
Due to County:
Tax Increment Bond
Deferred Interest Payable
Totals '" $
Consolidated Loan from City
Balance Amounts Due
Additions June 30, 2012 in One Year
$ 19,026,913 $ 262,146 $ 19,289,059 $
5,065,000 - 5,065,000 120,000
434,904 - 434,904 -
$24,526,817 $ 262,146 $ 24,788,963 $ 120,000
The City entered into an agreement to provide the former Redevelopment Agency
(RDA) operating funds and staff assistance, supplies, technical and other services
and facilities of the City as the RDA requires in carrying out its function under the
community redevelopment law. The RDA was to repay the resulting indebtedness,
plus interest, from incremental property tax revenues arising from the project area,
as such revenue became available. Pursuant to redevelopment dissolution law,
loans from cities to redevelopment agencies made more than two years after
See independent auditors' report.
74
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
formation of the redevelopment agency are not recognized obligations. Therefore,
the Consolidated Loan from the City has been disallowed on the Successor
Agency's Recognized Obligation Payment Schedule. However, an amendment to
the redevelopment dissolution law provides a method to obtain a Finding of
Completion from the California Department of Finance, which will lead to
recognition of the City's Consolidated Loan as an obligation of the Successor
Agency. The Successor Agency has met the requirements to date, and it is
anticipated that the Successor Agency will meet the remaining requirements to
obtain the Finding of Completion during 2013.
Variable interest accrued at a rate of 3.389 percent during the fiscal year ended
June 30, 2012. Of the $19,289,059 advance, $14,510,123 relates to the
Portuguese Bend portion of the former Redevelopment Agency, while $4,778,936
relates to the Abalone Cove portion. During the year ended June 30, 2012,
accrued interest of $474,634 was added to the balance of the advance to the
Portuguese Bend Fund, while principal of $89,918 and accrued interest of
$156,321 was advanced to the Abalone Cove Fund.
Tax Increment Bond and Deferred Interest Payable
In July 1991, the former Redevelopment Agency received $10,000,000 in loan
proceeds (the Loan) from the County of Los Angeles (the County) upon the
County's issue of Abalone Cove Improvement Bonds 2651-M pursuant to a
Reimbursement and Settlement Agreement (the Agreement), dated October 27,
1987 in connection with the Horan Lawsuit. The Loan was made for the purpose
of abating the Abalone Cove landslide. The settlement Loan was secured by
property assessment liens in the Abalone Cove project area.
As stipulated by the parties to the Agreement, a portion of the Loan proceeds was
used to repay a tax allocation and revenue anticipation promissory note issued to
the County in the principal amount of $1,450,000, plus accrued interest equal to
$179,244. A second portion of the proceeds was used to repay expenses
advanced by the County in the amount of $135,614. A third portion was used to
repay certain loans from the City to the former Redevelopment Agency in the
amount of $787,340.
Per the terms of the Agreement, $1,000,000 of the proceeds was deposited in the
Abalone Cove Permanent Fund of the Joint Powers Improvement Authority. The
remainder of the proceeds was accounted for in the former Redevelopment
Agency's Abalone Cove Fund. Concurrent with the execution of the Agreement,
the County deeded its title in the Abalone Cove Beach Park to the former
Redevelopment Agency.
See independent auditors' report.
75
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
As part of the Agreement, the former Redevelopment Agency was required to
transfer 17 percent of tax increment revenue to the Consolidated Fire Protection
District of the County and 50.9 percent of tax increment revenue for debt
repayment to the County. In accordance with the Agreement, the former
Redevelopment Agency was to pay the Loan principal plus interest at 7.7654
percent over a 30 -year period that began in 1992. However, these debt payments
were to be deferred 10 years until the fiscal year ended June 30, 2002.
As part of the deferral arrangement, the accrued interest from the inception of the
Loan through June 30, 2002, in the amount of $7,314,944, was scheduled for
payment over a 20 -year period beginning in the fiscal year ended June 30, 2002
with no additional interest. The remaining balance of $10,274,119 was scheduled
for payment to the County over a 20 -year period beginning in the fiscal year ended
June 30, 2002, with interest at 7.7654 percent.
On November 1, 1997, the City, the former Redevelopment Agency and the
County of Los Angeles entered into a Memorandum of Understanding (MOU)
agreeing to restructure the repayment schedule of the debt owed to the County by
the former Redevelopment Agency. In accordance with the terms of the MOU, the
$10,000,000 loan principal owed to the County was cancelled. As consideration for
the loan cancellation, the former Redevelopment Agency made a lump sum
payment to the County in the amount of $4,545,000 and issued a $5,455,000 tax
increment bond to the County (the bond). Of the $4,545,000 lump sum payment,
$2,000,000 was paid from tax increment revenue and interest earnings
accumulated in the Debt Service Fund. The remaining $2,545,000 was funded by a
combination of a loan from the General Fund of the City to the Agency for
$1,545,000 and a net operating transfer from the Agency's Abalone Cove Capital
Projects Fund to the Debt Service Fund of $1,000,000. The private property liens
resulting from the formation of the bond assessment district in connection with the
Reimbursement and Settlement Agreement in 1987 were discharged in
accordance with the terms of the MOU.
The bond was issued as a conduit through the Improvement Authority to the
County. No issuance costs were incurred. Future allocations of property tax to the
Successor Agency will fund the payment of the bond debt and the deferred interest
from the original Loan until paid in full. Prior to Redevelopment Agency dissolution,
the County withheld payment of the Agency's net tax increment revenue (net of the
17 percent payment to the County Fire Protection District and the 20 percent
housing set-aside amount) to offset the annual principal and interest charges. The
principal of the bond began maturing in installments each December 2nd,
commencing December 2, 2004. Interest accrues at a rate of 5 percent per annum
and is payable in arrears each June 2nd and December 2nd.
See independent auditors' report.
76
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
Additionally, both the accrued interest and deferred interest on the $10,000,000
Loan previously owed the County was retroactively recalculated from the Loan
origination date at a rate of approximately 5 percent compared to 7.7654 percent
per the original Agreement. The recalculated deferred interest was $3,111,400. In
accordance with the MOU, the recalculated deferred interest does not accrue
additional interest. As of June 30, 2012, a total of $2,676,496 in accumulated tax
increment has been applied against this balance, including $363,697 applied
during fiscal year 2011-12. The remaining balance at June 30, 2012, was
$434,904. The accumulated amount of property tax increment withheld by the
County prior to dissolution, in excess of amounts applied to principal and interest
payments is recorded in the Successor Agency Fund as a prepaid item at June 30,
2012.
The debt service schedule below summarizes all fixed principal and interest
payments for the term of the bond. Because the payback period for the deferred
interest amount will fluctuate depending on the availability of excess property tax
revenue, no amounts have been included in the following schedule for repayment
of the deferred interest.
Year Ending
June 30, Principal Interest Total
2013 120,000 250,250 370,250
2014 135,000 243,875 378,875
2015 155,000 236,625 391,625
2016 180,000 228,250 408,250
2017 200,000 218,750 418,750
2018-2022 1,420,000 905,500 2,325,500
2023-2027 2,275,000 448,875 2,723,875
2028 580,000 14,500 594,500
Totals $5,065,000 $ 2,546,625 $ 7,611,625
NOTE #15 — RESTATEMENT OF BEGINNING NET ASSETS:
The net assets of the governmental activities at July 1, 2011 were restated as
follows:
Net assets as previously reported — July 1, 2011 $152,271,142
To adjust for:
Revenues related to long-term notes
receivable, accrued unpaid interest and other
amounts earned but not available were
properly reported as deferred in the fund
See independent auditors' report.
77
CITY OF RANCHO PALOS VERDES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
financial statements (modified accrual basis of
accounting), however, they were not
recognized as earned in the government -wide
financial statements (accrual basis of
accounting). 3.689.642
Net assets as restated — July 1, 2011 $ 155,960,784
See independent auditors' report.
78
SUPPLEMENTARY INFORMATION
79
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
CAPITAL IMPROVEMENTS CAPITAL PROJECTS FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Revenue from other agencies $ 1,558,979 $ 4,047,567 $ 139,340 $ (3,908,227)
Use of money and property 28,600 28,600 36,780 8,180
TOTAL REVENUES 1,587,579 4,076,167 176,120 (3,900,047)
EXPENDITURES:
Capital Outlay
Infrastructure administration 70,000 25,500 25,437 63
Street improvements 4,885,532 2,772,335 2,531,917 240,418
Parks/Trails/Open Space improvements 1,102,000 2,256,268 229,547 2,026,721
Sewer improvements - 114,450 113,982 468
Building improvements 167,500 167,500 38,548 128,952
TOTAL EXPENDITURES 6,225,032 5,336,053 2,939,431 2,396,622
EXCESS (DEFICIENCY) OF REVENUES
OVER(UNDER)EXPENDITURES (4,637,453) (1,259,886) (2,763,311) (1,503,425)
OTHER FINANCING SOURCES:
Transfers in 6,609,480 8,833,841 6,520,472 (2,313,369)
NET CHANGE IN FUND BALANCE 1,972,027 7,573,955 3,757,161 (3,816,794)
FUND BALANCE - BEGINNING OF YEAR 11,649,780 11,649,780 11,649,780 -
FUND BALANCE - END OF YEAR $ 13,621,807 $ 19,223,735 $ 15,406,941 $ (3,816,794)
See independent auditors' report
80
CITY OF RANCHO PALOS VERDES
JUNE 30, 2012
NONMAJOR GOVERNMENTAL FUNDS
Special Revenues Fund Descriptions
Special Revenue Funds are used to account for taxes and other revenues set
aside in accordance with law or administrative regulation for a specific purpose.
Air Quality Management — to account for AB2766 fees received to fund programs
to reduce air pollution from motor vehicles.
Community Development Block Grant (CDBG) — to account for Federal Grants
received from the Department of Housing and Urban Development (HUD).
El Prado — to account for taxes collected to maintain and service existing and
proposed improvements to the common area of the El Prado neighborhood.
Redevelopment Agency Housing Set -Aside — to account for the portion of
redevelopment tax increment revenue set-aside for the development of
affordable housing.
Proposition A — to account for the City share of an additional one-half percent
sales tax designated to fund certain public transportation orientated projects.
Proposition C — to account for sales taxes received from the County and used to
support public transit and related services.
Measure R — to account for the half -cent sales tax approved by the Los Angeles
County voters in November 2008 to meet transportation needs, including
maintenance and improvement of arterial streets, traffic control, bikeway and
pedestrian improvements, and public transit.
Beautification — to account for monies received for the City's recycling program
used for community improvement, grants and promotion of recycling.
Waste Reduction — to account for AB939 fees received for state mandated waste
reduction and recycling plans and programs.
Public Safety Grants — to account for federal grant funds for local law
enforcement supplemental services, AB3229 funds used for additional law
enforcement services and public safety technology equipment.
1972 Act Landscaping and Lighting District (1972 Act) — to account for revenues
and costs associated with the City's landscaping and lighting district.
81
CITY OF RANCHO PALOS VERDES
JUNE 30, 2012
NONMAJOR GOVERNMENTAL FUNDS
1911 Act Liahtina District (1911 Act) — to account for revenue and costs
associated with a lighting district transferred to the "city -side" landscape and
lighting district from the County in 1995.
Joint Powers Improvement Authority - Portuguese Bend — to account for
maintenance and repairs of landslide abatement improvements in the
Portuguese Bend Project area.
Habitat Restoration — to account for fees paid by developers for conservation
easements to be used exclusively for habitat restoration efforts on City owned
property.
Measure A — to account for the voter approved 1992 and 1996 Measure A funds
and other state and county grants used for the acquisition of open space and
park improvements.
Abalone Cove Sewer Assessment District — to account for property assessments
used to partially pay for operation and maintenance of the Abalone Cove sewer
system.
Dr. Allen and Charlotte Ginsbura Cultural Arts Building (Ginsbura Cultural Art
Bldg) — to account for a private donation to be used for either construction of a
building at the Upper Point Vicente Civic Center to be used for dancing and other
cultural activities, or for the purchase of open space within the City for habitat
conservation and passive recreational purposes.
Donor Restricted Contributions — to account for donations received to construct
or acquire recreational facilities within the City.
Bikeways — to account for state funds that are used for the construction of
bikeways and pedestrian facilities.
Environmental Excise Tax — to account for taxes received in connection with new
construction within the City.
Quimby — to account for developer paid fees or the dedication of land for park
and recreation purposes.
Debt Service Fund Descriptions
Redevelopment Aaencv Debt Service — to account for the accumulation of
resources and for the payment of principal and interest on the former
redevelopment agency debt.
82
CITY OF RANCHO PALOS VERDES
JUNE 30, 2012
NONMAJOR GOVERNMENTAL FUNDS
Capital Proiects Fund Descriptions
Capital Projects Funds are used to account for financial resources used for the
acquisition or construction of major capital facilities.
Redevelopment Aaencv - Abalone Cove — to account for monies used for
landslide abatement in the Abalone Cove area of the Redevelopment Agency
Project Area.
Redevelopment Aaencv - Portuguese Bend — to account for monies used for
landslide abatement in the Portuguese Bend area of the Redevelopment Agency
Project Area.
Permanent Fund Descriptions
Permanent Funds are used to account for resources legally restricted to the
extent that only earnings, and not principal, may be used for purposes that
support the City's programs.
Subregion One Maintenance — to account for monies used to maintain public
improvements and habitat areas dedicated to the City upon completion of the
Subregion One residential development project also known as Oceanfront
Estates. As part of the development agreement, the City received a $750,000
non -expendable deposit. The interest earnings contribute to the maintenance of
the public open space.
Joint Powers Improvement Authority - Abalone Cove — to account for monies
received as part of a July 1991 Reimbursement and Settlement Agreement with
the County of Los Angeles. As a part of this Agreement, the Authority received a
$1,000,000 non -expendable deposit. The interest earnings are used to pay for
maintenance and repair of Abalone Cove landslide abatement improvements.
83
CITY OF RANCHO PALOS VERDES
COMBINING BALANCE SHEET
OTHER GOVERNMENTAL FUNDS
June 30, 2012
Special Revenue Funds
Redevelopment
Air Agency
Quality Housing
Management CDBG El Prado Set -Aside Proposition A
ASSETS
Cash and investments $ 88,198 $ - $ 16,620 $ - $ 170,857
Receivables:
Taxes - 142 -
Interest 57 12 - 65
Notes - 479,024 - - -
Other 12,932 129,855 - - -
Prepaid items -
Advance to other funds - - -
TOTAL ASSETS
LIABILITIES AND
FUND BALANCES
LIABILITIES:
Accounts payable and
accrued liabilities
Due to other funds
Deferred revenue
TOTAL LIABILITIES
$ 101,187 $ 608,879 $ 16,774 $ - $ 170,922
- $ 51,371 $ - $ - $ 501
- 78,521 - - -
- 521,434 - - -
- 651,326 - - 501
FUND BALANCES:
Non -Spendable
Endowment principal - - -
Reimbursement settlement
agreement - - -
Prepaid items - - -
Long teem advances - - -
Habitat restoration - -
Restricted 101,187 16,774 170,421
Committed - - -
Assigned - - -
Unassigned - (42,447) - - -
TOTAL FUND
BALANCES 101,187 (42,447) 16,774 - 170,421
TOTAL LIABILITIES
AND FUND BALANCES $ 101,187 $ 608,879 $ 16,774 $ - $ 170,922
See independent auditors' report
84
Special Revenue Funds (Continued)
Public
Waste Safety
Proposition C Measure R Beautification Reduction Grants 1972 Act 1911 Act
$ 1,340,334 $ 391,221 $ 1,061,087 $ 279,997 $ 20,102 $ 66,549 $ 1,660,622
1,477 705 835 264
4,000
11,738
15,550 36,313
86 180 1,280
$ 1,341,811 $ 391,926 $ 1,065,922 $ 291,999 $ 20,188 $ 82,279 $ 1,698,215
$ $ $ 439 $ 12,122 $ $ 4,200 $ 27,831
1,341,811 391,926
- $ 10,916
439 23,038 4,200 27,831
1,065,483
268,961
20,188
78,079 1,670,384
1,341,811 391,926 1,065,483 268,961 20,188 78,079 1,670,384
$ 1,341,811 $ 391,926 $ 1,065,922 $ 291,999 $ 20,188 $ 82,279 $ 1,698,215
(Continued)
85
CITY OF RANCHO PALOS VERDES
COMBINING BALANCE SHEET
OTHER GOVERNMENTAL FUNDS
(CONTINUED)
June 30, 2012
Special Revenue Funds
Dr. Allen and
Joint Powers Abalone Cove Charlotte
Improvement Sewer Ginsburg
Authority Habitat Assessment Cultural
Portuguese Bend Restoration Measure A District Arts Building
ASSETS
Cash and investments $ 327,665 $ 229,069 $ 7,440 $ 63,869 $ 158,365
Receivables:
Taxes - - 2,470
Interest - 179 19 y 73 115
Notes - - -
Other - 23,683 100,000 -
Prepaid items - - -
Advance to other funds - - -
TOTAL ASSETS S 327,665 $ 252,931 $ 107,459 $ 66,412 $ 158,480
LIABILITIES AND
FUND BALANCES
LIABILITIES:
Accounts payable and
accrued liabilities $ 17,941 $ 31,890 $ - $ 27,141 $
Due to other funds - 73,144 -
Deferred revenue - 100,000 -
TOTAL LIABILITIES 17,941 31,890 173,144 27,141
FUND BALANCES:
Non -Spendable
Endowment principal - - -
Reimbursement settlement
agreement - - -
Prepaid items - - -
Long term advances - - -
Habitat restoration - 74,696 - -
Restricted 309,724 146,345 - 39,271 158,480
Committed - - -
Assigned - - -
Unassigned - (65,685) -
TOTAL FUND
BALANCES 309,724 221,041 (65,685) 39,271 158,480
TOTAL LIABILITIES
AND FUND BALANCES $ 327,665 $ 252,931 $ 107,459 $ 66,412 $ 158,480
See independent auditors' report
86
Special Revenue Funds (Continued;
Donor
Restricted Environmental
Contributions Bikeways Excise Tax
Quimby
Total Redevelopment
Special Agency
Revenue Debt
Funds Service
$ 406,513 $ 61 $ 447,706 $ 29,400 $ 6,765,675 $
- 54,475
296 321 21 5,985
- 479,024
- 282,208
$ 406,809 $ 61 $ 448,027 $ 29,421 $ 7,587,367 $
$ $ $ 33,502 $ - $ 206,938 $
- 151,665
- 632,350
33,502 - 990,953
- 74,696
406,809 61 414,525 29,421 6,629,850
- (108,132)
406,809 61 414,525 29,421 6,596,414
$ 406,809 $ 61 $ 448,027 $ 29,421 $ 7,587,367 $
(Continued)
CITY OF RANCHO PALOS VERDES
COMBINING BALANCE SHEET
OTHER GOVERNMENTAL FUNDS
(CONTINUED)
June 30, 2012
ASSETS
Cash and investments
Receivables:
Taxes
Interest
Notes
Other
Prepaid items
Advance to other funds
Capital Projects Funds
Redevelopment Redevelopment Total
Agency Agency Capital
Abalone Portuguese Projects
Cove Bend Funds
$ - $
TOTAL ASSETS
LIABILITIES AND
FUND BALANCES
LIABILITIES:
Accounts payable and
accrued liabilities
Due to other funds
Deferred revenue
TOTAL LIABILITIES
FUND BALANCES:
Non -Spendable
Endowment principal
Reimbursement settlement
agreement
Prepaid items
Long term advances
Habitat restoration
Restricted
Committed
Assigned
Unassigned
TOTAL FUND
BALANCES
$ - $
TOTAL LIABILITIES
AND FUND BALANCES
See independent auditors' report
Permanent Funds
Joint Powers Total
Subregion Improvement Total Other
One Authority Permanent Governmental
Maintenance Abalone Cove Funds Funds
$ 779,889 $ 1,205,326 $ 1,985,215 $ 8,750,890
- - - 54,475
573 2 575 6,560
- - - 479,024
- - - 282,208
$ 780,462 $ 1,205,328 $ 1,985,790 $ 9,573,157
$ 6,903 $ 2,514 $ 9,417 $ 216,355
- - - 151,665
- - - 632,350
6,903 2,514 9,417 1,000,370
750,000 - 750,000 750,000
1,000,000 1,000,000 1,000,000
- - - 74,696
23,559 202,814 226,373 6,856,223
- - - (108,132)
773,559 1,202,814 1,976,373 8,572,787
$ 780,462 $ 1,205,328 $ 1,985,790 $ 9,573,157
(Continued)
89
CITY OF RANCHO PALOS VERDES
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES - OTHER GOVERNMENTAL FUNDS
For the year ended June 30, 2012
Special Revenue Funds
Redevelopment
Air Agency
Quality Housing
Management CDBG El Prado Set -Aside Proposition A
REVENUES:
Taxes $ - $ - $ 1,973 $ - $
Revenue from other agencies 52,390 173,092 - - 626,793
Use of money and property 190 - 49 2 242
Other revenues -
TOTAL REVENUES
52,580 173,092
2,022
2 627,035
EXPENDITURES:
Current:
Administration - - -
Public safety - - -
Public works - - 29 - 582,217
Coimnunity development - - 288
Parks and recreation - - -
Capital outlay - 215,539 -
Debt service - principal - - -
Debt service - interest - - -
TOTAL EXPENDITURES - 215,539 29 288 582,217
EXCESS (DEFICIENCY)
OF REVENUES OVER
(UNDER) EXPENDITURES 52,580 (42,447) 1,993 (286) 44,818
OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
TOTAL OTHER FINANCINC
SOURCES (USES)
EXTRAORDINARY GAIN (LOSS
NET CHANGE IN
FUND BALANCES
FUND BALANCES (DEFICIT)
BEGINNING OF YEAR
FUND BALANCES (DEFICIT) -
END OF YEAR
See independent auditors' report.
- - (1,827,132)
52,580 (42,447) 1,993 (1,827,418) 44,818
48,607 - 14,781 1,827,418 125,603
$ 101,187 $ (42,447) $ 16,774 $ - $ 170,421
90
Special Revenue Funds (Continued)
Public
Waste Safety
Proposition C Measure R Beautification Reduction Grants 1972 Act 1911 Act
$ - $ - $ - $ - $ - $ 258,814 $ 504,991
521,486 387,409 23,533 100,000 -
6,050 2,597 311,734 208,076 256 570 5,419
527,536 390,006 311,734 231,609 100,256 259,384 510,410
- - 20,223 161,081 - 75,342 419,984
- - 20,223 161,081 - 75,342 419,984
527,536 390,006 291,511 70,528 100,256 184,042 90,426
(756,400) (628,212) (142,810) (110,000) (100,000) (200,000) (72,688)
(756,400) (628,212) (142,810) (110,000) (100,000) (200,000) (72,688)
(228,864) (238,206) 148,701 (39,472) 256 (15,958) 17,738
1,570,675 630,132 916,782 308,433 19,932 94,037 1,652,646
$ 1,341,811 $ 391,926 $ 1,065,483 $ 268,961 $ 20,188 $ 78,079 $ 1,670,384
(Continued)
91
CITY OF RANCHO PALOS VERDES
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES - OTHER GOVERNMENTAL FUNDS
For the year ended June 30, 2012
REVENUES:
Taxes
Revenue from other agencies
Use of money and property
Other revenues
TOTAL REVENUES
EXPENDITURES:
Current:
Administration
Public safety
Public works
Coimnunity development
Parks and recreation
Capital outlay
Debt service - principal
Debt service - interest
TOTAL EXPENDITURES
EXCESS OF REVENUES OVER
(UNDER) EXPENDITURES
OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
TOTAL OTHER FINANCINC
SOURCES (USES)
EXTRAORDINARY GAIN (LOSS
NET CHANGE IN
FUND BALANCES
FUND BALANCE (DEFICIT)
BEGINNING OF YEAR
FUND BALANCES (DEFICIT) -
END OF YEAR
See independent auditors' report.
Joint Powers
Iinproveinent
Authority
Portuguese Bend
52,606
Special Revenue Funds
Habitat
Restoration Measure A
23,682
753
24,435
156,452
52,606 156,452
(52,606) (132,017)
60,000 90,000
60,000 90,000
7,394 (42,017)
302,330 263,058
$ 309,724 $ 221,041
92
160,641
70
160,711
160,711
(100,000)
(100,000)
Abalone Cove
Sewer
Assessment
District
Dr. Allen and
Charlotte
Ginsburg
Cultural
Arts Building
$ 52,948 $
289
1,217
60,711
(126,396)
$ (65,685) $
54,454
122,561
533
533
25,000
122,561 25,000
(68,107) (24,467)
10,700
10,700
(57,407) (24,467)
96,678 182,947
39,271 $ 158,480
Donor
Restricted
Contributions
$
$
1,290
Special Revenue Funds (Continued)
Bikeways
Total Redevelopment
Special Agency
Environmental Revenue Debt
Excise Tax Quimby Funds Service
$ - $ - $ 818,726 $ 442,150
- - 2,069,026
10 1,417 93 539,640
35,955 - 37,172
1,290 10 37,372 93 3,464,564 442,150
100,940
38,245 - 1,628,740
- - 288
- - 25,000
- - 215,539
- - 463,698
- - 497,934
38,245 - 1,869,567 1,062,572
1,290 10 (873) 93 1,594,997 (620,422)
- - 160,700
- (2,110,110)
- - - (1,949,410)
1,290
405,519
$ 406,809 $
- - (1,827,132) 18,571,421
10 (873) 93 (2,181,545) 17,950,999
51 415,398 29,328 8,777,959 (17,950,999)
61 $ 414,525 $ 29,421 $ 6,596,414 $
(Continued)
CITY OF RANCHO PALOS VERDES
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES - OTHER GOVERNMENTAL FUNDS
(CONTINUED)
For the year ended June 30, 2012
REVENUES:
Taxes
Revenue from other agencies
Use of money and property
Other revenues
TOTAL REVENUES
EXPENDITURES:
Current:
Administration
Public safety
Public works
Coimnunity development
Parks and recreation
Capital outlay
Debt service - principal
Debt service - interest
Capital Projects Funds
Redevelopment Redevelopment Total
Agency Agency Capital
Abalone Portuguese Projects
Cove Bend Funds
29,169 29,169
29,169 29,169
132,242 132,242
TOTAL EXPENDITURES - 132,242 132,242
EXCESS OF REVENUES OVER
(UNDER) EXPENDITURES - (103,073) (103,073)
OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
TOTAL OTHER FINANCINC
SOURCES (USES)
EXTRAORDINARY GAIN (LOSS (6,216) (221,585) (227,801)
NET CHANGE IN
FUND BALANCES (6,216) (324,658) (330,874)
FUND BALANCES (DEFICIT)
BEGINNING OF YEAR 6,216 324,658 330,874
FUND BALANCES (DEFICIT) -
END OF YEAR $ - $ $
See independent auditors' report.
Permanent Funds
Joint Powers Total
Subregion Iimproveiment Total Other
One Authority Permanent Governmental
Maintenance Abalone Cove Funds Funds
$ - $ - $ - $ 1,260,876
- - - 2,069,026
2,438 5 2,443 542,083
- - - 66,341
2,438 5 2,443 3,938,326
- - - 100,940
64,886 89,968 154,854 1,915,836
- - - 288
- - - 25,000
- - - 215,539
- - - 463,698
- - - 497,934
64,886 89,968 154,854 3,219,235
(62,448) (89,963) (152,411) 719,092
60,000 - 60,000 220,700
- - - (2,110,110)
60,000 - 60,000 (1,889,410)
- - - 16,516,488
(2,448) (89,963) (92,411) 15,346,170
776,007 1,292,777 2,068,784 (6,773,383)
$ 773,559 $ 1,202,814 $ 1,976,373 $ 8,572,787
(Continued)
95
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
AIR QUALITY MANAGEMENT SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Revenue from other agencies $ 50,000 $ 50,000 $ 52,390 $ 2,390
Use of money and property 260 260 190 (70)
TOTAL REVENUES 50,260 50,260 52,580 2,320
EXPENDITURES:
Public works
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
FUND BALANCE - BEGINNING OF YEAR
FUND BALANCE - END OF YEAR
See independent auditors report.
50,260 50,260 52,580 2,320
48,607 48,607 48,607
$ 98,867 $ 98,867 $ 101,187 $ 2,320
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
COMMUNITY DEVELOPMENT BLOCK GRANT SPECIAL REVENUE FUND
For the year ended June 30, 2012
REVENUES:
Revenue from other agencies
EXPENDITURES:
Capital outlay
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
OTHER FINANCING USES,
Transfers in
Transfers out
NET CHANGE IN FUND BALANCE
FUND BALANCE - BEGINNING OF YEAF
FUND BALANCE - END OF YEAR
See independent auditors' report.
Budgeted Amounts
Original Final
Actual
Variance with
Final Budget
Positive
(Negative)
$ 201,673 $ 324,364 $ 173,092 $ (151,272)
201,673 254,364 215,539 38,825
70,000 (42,447) (112,447)
97
70,000 (42,447) (112,447)
$ 70,000 $ (42,447) $ (112,447)
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
EL PRADO SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Taxes $ 1,900 $ 1,900 $ 1,973 $ 73
Use of money and property 70 70 49 (21)
TOTAL REVENUES 1,970 1,970 2,022 52
EXPENDITURES:
Public works 1,000 1,000 29 971
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES 970 970 1,993 1,023
FUND BALANCE - BEGINNING OF YEAR 14,781 14,781 14,781 -
FUND BALANCE - END OF YEAR $ 15,751 $ 15,751 $ 16,774 $ 1,023
See independent auditors' report
98
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
REDEVELOPMENT AGENCY HOUSING SET-ASIDE SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Taxes $ 234,500 $ 234,500 $ $ (234,500)
Use of money and property 100 100 2 (98)
TOTAL REVENUES 234,600 234,600 2 (234,598)
EXPENDITURES:
Community Development
Redevelopment 12,500 12,500 288 12212
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES 222,100 222,100 (286) (222,386)
EXTRAORDINARY LOSS ON DISSOLUTION OF
REDEVELOPMENT AGENCY (1,827,132) (1,827,132)
NET CHANGE IN FUND BALANCE 222,100 222,100 (1,827,418) (2,049,518)
FUND BALANCE - BEGINNING OF YEAR 1,827,418 1,827,418 1,827,418
FUND BALANCE - END OF YEAR $ 2,049,518 $ 2,049,518 $ $ (2,049,518)
See independent auditors' report and notes to financial statements.
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
PROPOSITION A SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Revenue from other agencies $ 586,200 $ 586,200 $ 626,793 $ 40,593
Use of money and property 180 180 242 62
TOTAL REVENUES 586,380 586,380 627,035 40,655
EXPENDITURES:
Public works
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
OTHER FINANCING USES:
Transfers in
595,100 597,592 582,217 15,375
(8,720) (11,212) 44,818 56,030
NET CHANGE IN FUND BALANCE (8,720) (11,212) 44,818 56,030
FUND BALANCE - BEGINNING OF YEAR 125,603 125,603 125,603 -
FUND BALANCE - END OF YEAR $ 116,883 $ 114,391 $ 170,421 $ 56,030
See independent auditors' report
100
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
PROPOSITION C SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Revenue from other agencies $ 488,400 $ 488,400 $ 521,486 $ 33,086
Use of money and property 6,830 6,830 6,050 (780)
TOTAL REVENUES 495,230 495,230 527,536 32,306
OTHER FINANCING USES:
Transfers out (1,823,327) (2,063,327) (756,400) 1,306,927
NET CHANGE IN FUND BALANCE (1,328,097) (1,568,097) (228,864) 1,339,233
FUND BALANCE - BEGINNING OF YEAR 1,570,675 1,570,675 1,570,675 -
FUND BALANCE - END OF YEAR $ 242,578 $ 2,578 $ 1,341,811 $ 1,339,233
See independent auditors' report
101
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
MEASURE R SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Revenue from other agencies $ 364,600 $ 364,600 $ 387,409 $ 22,809
Use of money and property - - 2,597 2,597
TOTAL REVENUES 364,600 364,600 390,006 25,406
OTHER FINANCING USES:
Transfers out (364,000) (992,212) (628,212) 364,000
NET CHANGE IN FUND BALANCE 600 (627,612) (238,206) 389,406
FUND BALANCE - BEGINNING OF YEAR 630,132 630,132 630,132 -
FUND BALANCE - END OF YEAR $ 630,732 $ 2,520 $ 391,926 $ 389,406
See independent auditors' report
102
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
BEAUTIFICATION SPECIAL REVENUE FUND
For the year ended June 30, 2012
Budgeted Amounts
Original Final
Actual
Variance with
Final Budget
Positive
(Negative)
REVENUES:
Other revenues $ - $ - $ - $ -
Use ofmoney and property 281,600 281,600 311,734 30,134
TOTAL REVENUES 281,600 281,600 311,734 30,134
EXPENDITURES:
Public works 95,400 170,300 20,223 150,077
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES 186,200 111,300 291,511 180,211
OTHER FINANCING USES:
Transfers out (116,000) (616,500) (142,810) 473,690
NET CHANGE IN FUND BALANCE 70,200 (505,200) 148,701 653,901
FUND BALANCE - BEGINNING OF YEAR 916,782 916,782 916,782 -
FUND BALANCE - END OF YEAR $ 986,982 $ 411,582 $ 1,065,483 $ 653,901
See independent auditors' report
103
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
WASTE REDUCTION SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Revenue from other agencies $ 47,500 $ 47,500 $ 23,533 $ (23,967)
Use of money and property 156,675 156,675 208,076 51,401
TOTAL REVENUES 204,175 204,175 231,609 27,434
EXPENDITURES:
Public works 182,650 182,150 161,081 21,069
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES 21,525 22,025 70,528 48,503
OTHER FINANCING USES:
Transfers out (52,000) (122,000) (110,000) 12,000
NET CHANGE IN FUND BALANCE (30,475) (99,975) (39,472) 60,503
FUND BALANCE - BEGINNING OF YEAR 308,433 308,433 308,433 -
FUND BALANCE - END OF YEAR $ 277,958 $ 208,458 $ 268,961 $ 60,503
See independent auditors' report
104
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
PUBLIC SAFETY GRANTS SPECIAL REVENUE FUND
For the year ended June 30, 2012
REVENUES:
Revenue from other agencies
Use of money and property
TOTAL REVENUES
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
$ 100,000 $ 100,000 $ -
170 170 256 86
170 100,170 100,256 86
EXPENDITURES:
Public safety 19,600
EXCESS (DEFICIENCY) OF REVENUES
OVER(UNDER)EXPENDITURES (19,430) 100,170 100,256 86
OTHER FINANCING USES:
Transfers out - (100,000) (100,000)
NET CHANGE IN FUND BALANCE (19,430) 170 256 86
FUND BALANCE - BEGINNING OF YEAR 19,932 19,932 19,932 -
FUND BALANCE - END OF YEAR $ 502 $ 20,102 $ 20,188 $ 86
See independent auditors' report
105
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
1972 ACT SPECIAL REVENUE FUND
For the year ended June 30, 2012
Budgeted Amounts
Original Final
Actual
Variance with
Final Budget
Positive
(Negative)
REVENUES:
Taxes $ 258,000 $ 258,000 $ 258,814 $ 814
Use of money and property 180 180 570 390
TOTAL REVENUES 258,180 258,180 259,385 1,204
EXPENDITURES:
Public works
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
71,800 73,800 75,342 (1,542)
186,380 184,380 184,042 (338)
OTHER FINANCING USES:
Transfers out (200,000) (200,000) (200,000) -
NET CHANGE IN FUND BALANCE (13,620) (15,620) (15,958) (338)
FUND BALANCE - BEGINNING OF YEAR 94,037 94,037 94,037 -
FUND BALANCE - END OF YEAR $ 80,417 $ 78,417 $ 78,079 $ (338)
See independent auditors' report
106
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
1911 ACT SPECIAL REVENUE FUND
For the year ended June 30, 2012
Budgeted Amounts
Original Final
Actual
Variance with
Final Budget
Positive
(Negative)
REVENUES:
Taxes $ 440,000 $ 440,000 $ 504,991 $ 64,991
Use of money and property 7,600 7,600 5,419 (2,181)
TOTAL REVENUES 447,600 447,600 510,410 62,810
EXPENDITURES:
Public works 444,400 444,400 419,984 24,416
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
3,200 3,200
90,426 87,226
OTHER FINANCING USES:
Transfers out (202,000) (202,000) (72,688) 129,312
NET CHANGE IN FUND BALANCE (198,800) (198,800) 17,738 216,538
FUND BALANCE - BEGINNING OF YEAR 1,652,646 1,652,646 1,652,646 -
FUND BALANCE - END OF YEAR $ 1,453,846 $ 1,453,846 $ 1,670,384 $ 216,538
See independent auditors' report
107
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
JOINT POWERS IMPROVEMENT AUTHORITY PORTUGUSE BEND SPECIAL REVENUE FUND
For the year ended June 30, 2012
Budgeted Amounts
Original Final
Actual
Variance with
Final Budget
Positive
(Negative)
REVENUES:
Use of money and property $ 1,220 $ 1,220 $ - $ (1,220)
EXPENDITURES:
Public works 143,350 143,350 52,606 90,744
EXCESS (DEFICIENCY) OF REVENUES
OVER(UNDER)EXPENDITURES (142,130) (142,130) (52,606) 89,524
OTHER FINANCING SOURCES:
Transfers in 60,000 60,000 60,000 -
NET CHANGE IN FUND BALANCE (82,130) (82,130) 7,394 89,524
FUND BALANCE - BEGINNING OF YEAR 302,330 302,330 302,330 -
FUND BALANCE - END OF YEAR $ 220,200 $ 220,200 $ 309,724 $ 89,524
See independent auditors' report
108
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
HABITAT RESTORATION SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Revenue from other agencies $ $ - $ 23,682 $ 23,682
Use of money and property 1,300 1,300 753 (547)
TOTAL REVENUES 1,300 1,300 24,435 23,135
EXPENDITURES:
Public works 129,000 133,000 156,452 (23.452)
EXCESS (DEFICIENCY) OF REVENUES
OVER (TINDER) EXPENDITURES (127.700) (131,700) (132.017) (317)
OTHER FINANCING SOURCES:
Transfers in 90,000 90,000 90,000
NET CHANGE IN FUND BALANCE (37.700) (41,700) (42,017) (317)
FUND BALANCE - BEGINNING OF YEAR 263,058 263,058 263,058
FUND BALANCE - END OF YEAR $ 225,358 $ 221,358 $ 221,041 $ (317)
See independent auditors' report.
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
MEASURE A SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Revenue from other agencies $ 250,000 $ 250,000 $ 160,641 $ (89,359)
Use of money and property 170 170 70 (100)
TOTAL REVENUES 250,170 250,170 160,711 (89,459)
OTHER FINANCING USES:
Transfers out (250,000) (250,000) (100,000) 150,000
NET CHANGE IN FUND BALANCE 170 170 60,711 60,541
FUND BALANCE - BEGINNING OF YEAR (126,396) (126,396) (126,396) -
FUND BALANCE (DEFICIT) - END OF YEAR $ (126,226) $ (126,226) $ (65,685) $ 60,541
See independent auditors' report
110
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
ABALONE COVE SEWER ASSESSMENT DISTRICT SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Taxes $ 46,600 $ 46,600 $ 52,948 $ 6,348
Other revenues - - 1,217 1,217
Use of money and property 260 260 289 29
TOTAL REVENUES 46,860 46,860 54,454 7,594
EXPENDITURES:
Public works 63,900 133,800 122,561 11,239
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES (17,040) (86,940) (68,107) 18,833
OTHER FINANCING SOURCES:
Transfers in 10,700 10,700 10,700 -
NET CHANGE IN FUND BALANCE (6,340) (76,240) (57,407) 18,833
FUND BALANCE - BEGINNING OF YEAR 96,678 96,678 96,678 -
FUND BALANCE - END OF YEAR $ 90,338 $ 20,438 $ 39,271 $ 18,833
See independent auditors' report
111
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
DR. ALLEN AND CHARLOTTE GINSBURG CULTURAL ARTS BUILDING SPECIAL REVENUE FUND
For the year ended June 30, 2012
REVENUES:
Use of money and property
TOTAL REVENUES
EXPENDITURES:
Park and recreation
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
FUND BALANCE - BEGINNING OF YEAR
FUND BALANCE - END OF YEAR
See independent auditors' report
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
$ 920 $ 920 $ 533 $ (387)
920 920 533 (387)
25,000 25,000
920 (24,080) (24,467) (387)
182,947 182,947 182,947 -
$ 183,867 $ 158,867 $ 158,480 $ (387)
112
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
DONOR RESTRICTED CONTRIBUTIONS SPECIAL REVENUE FUND
For the year ended June 30, 2012
REVENUES:
Use of money and property
FUND BALANCE - BEGINNING OF YEAR
FUND BALANCE - END OF YEAR
See independent auditors' report.
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
$ 2,020 $ 2,020 $ 1,290 $ (730)
405,519 405,519 405,519
$ 407,539 $ 407,539 $ 406,809 $ (730)
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
BIKEWAYS SPECIAL REVENUE FUND
For the year ended June 30, 2012
Budgeted Amounts
Original Final
Actual
Variance with
Final Budget
Positive
(Negative)
REVENUES:
Revenue from other agencies $ 25,000 $ 25,000 $ - $ (25,000)
Use of money and property - - 10 10
TOTAL REVENUES 25,000 25,000 10 (24,990)
OTHER FINANCING USES:
Transfers out (25,000) (25,000) - 25,000
NET CHANGE IN FUND BALANCE - - 10 10
FUND BALANCE - BEGINNING OF YEAR 51 51 51 -
FUND BALANCE - END OF YEAR $ 51 $ 51 $ 61 $ 10
See independent auditors' report
114
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
ENVIRONMENTAL EXCISE TAX SPECIAL REVENUE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Other revenues $ - $ - $ 35,955 $ 35,955
Use of money and property 410 410 1,417 1,007
TOTAL REVENUES 410 410 37,372 36,962
EXPENDITURES:
Public works 51,000 38,245 38,245
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES (50,590) (37,835) (873) 36,962
OTHER FINANCING USES:
Transfers out - - - -
NET CHANGE IN FUND BALANCE (50,590) (37,835) (873) 36,962
FUND BALANCE - BEGINNING OF YEAR 415,398 415,398 415,398 -
FUND BALANCE - END OF YEAR $ 364,808 $ 377,563 $ 414,525 $ 36,962
See independent auditors' report
115
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
QUIMBY SPECIAL REVENUE FUND
For the year ended June 30, 2012
REVENUES:
Other revenues
Use of money and property
TOTAL REVENUES
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
150 150 93 (57)
150 150 93 (57)
EXPENDITURES:
Park and recreation 29,000
EXCESS (DEFICIENCY) OF REVENUES
OVER (TINDER) EXPENDITURES (28.850) 150 93 (57)
FUND BALANCE - BEGINNING OF YEAR 29,328 29,328 29,328
FUND BALANCE - END OF YEAR $ 478 $ 29,478 $ 29,421 $ (57)
See independent auditors' report.
CITY OF RANCHO PALOS VERDES
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
REDEVELOPMENT AGENCY DEBT SERVICE FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Taxes $ 938.000 $ 938,000 $ 442.150 $ (495,850)
EXPENDITURES:
Current:
Administration 21,000 21,000 17.373 3,627
Pass through to other agencies 199.300 199,300 83.567 115,733
Debt service:
Principal 428.700 428,700 463.698 (34,998)
Interest and fiscal charges 905,250 905,250 497.934 407,316
TOTAL EXPENDITURES 1,554,250 1,554.250 1,062,572 491,678
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
(616,250) (616.250) (620,422) (4,172)
EXTRAORDINARY LOSS ON DISSOLUTION OF
REDEVELOPMENT AGENCY 18,571,421 18,571,421
NET CHANGE IN FUND BALANCE (616,250) (616.250) 17,950,999 18,567,249
FUND DEFICIT - BEGINNING OF YEAR (17.950,999) (17,950.999) (17.950,999)
FUND DEFICIT - END OF YEAR $ (18.567,249) $ (18,567.249) $ $ 18,567,249
See independent auditors report.
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
REDEVELOPMENT AGENCY ABALONE COVE CAPITAL PROJECTS FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Use of money and property $ $ $ $
EXTRAORDINARY LOSS ON DISSOLUTION Of
REDEVELOPMENT AGENCY (6.216) (6.216)
NET CHANGE IN FUND BALANCE (6.216) (6.216)
FUND BALANCE - BEGINNING OF YEAR 6,216 6,216 6,216
FUND BALANCE - END OF YEAR $ 6,216 $ 6,216 $ $ (6.216)
See independent auditors' report.
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
REDEVELOPMENT AGENCY PORTUGUESE BEND CAPITAL PROJECTS FUND
For the year ended June 30, 2012
Variance with
Final Budget
Budgeted Amounts Positive
Original Final Actual (Negative)
REVENUES:
Other revenues - 29,169 29,169
Use of money and property $ 1,370 $ 1,370 $ - $ (1.370)
TOTAL REVENUES 1,370 1,370 29,169 27,799
EXPENDITURES:
Public works 36,800 156,781 132,242 24,540
EXCESS (DEFICIENCY) OF REVENUES
OVER(UNDER)EXPENDITURES (35.430) (155,411) (103.073) 52,339
EXTRAORDINARY LOSS ON DISSOLUTION OF
REDEVELOPMENT AGENCY (221.585) (221.585)
NET CHANGE IN FUND BALANCE (35.430) (155,411) (324,658) (169.247)
FUND BALANCE - BEGINNING OF YEAR 324,658 324,658 324,658
FUND BALANCE - END OF YEAR $ 289,228 $ 169,247 $ $ (169.247)
See independent auditors' report.
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
SUBREGION ONE MAINTENANCE PERMANENT FUND
For the year ended June 30, 2012
Budgeted Amounts
Original Final
Actual
Variance with
Final Budget
Positive
(Negative)
REVENUES:
Use of money and property $ 3,800 $ 3,800 $ 2,438 $ (1,362)
EXPENDITURES:
Public works 70,000 80,000 64,886 15,114
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES (66,200) (76,200) (62,448) 13,752
OTHER FINANCING SOURCES:
Transfers in 60,000 60,000 60,000 -
NET CHANGE IN FUND BALANCE (6,200) (16,200) (2,448) 13,752
FUND BALANCE - BEGINNING OF YEAR 776,007 776,007 776,007 -
FUND BALANCE - END OF YEAR $ 769,807 $ 759,807 $ 773,559 $ 13,752
See independent auditors' report
120
CITY OF RANCHO PALOS VERDES
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
JOINT POWERS IMPROVEMENT AUTHORITY ABALONE COVE PERMANENT FUND
For the year ended June 30, 2012
REVENUES:
Use of money and property
EXPENDITURES:
Public works
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
FUND BALANCE - BEGINNING OF YEAR
FUND BALANCE - END OF YEAR
See independent auditors' report
Budgeted Amounts
Original Final
Actual
Variance with
Final Budget
Positive
(Negative)
$ 6,200 $ 6,200 $ 5 $ (6,195)
49,750 49,750 89,968 (40,218)
(43,550) (43,550) (89,963) (46,413)
1,292,777 1,292,777 1,292,777 -
$ 1,249,227 $ 1,249,227 $ 1,202,814 $ (46,413)
121
20 dale of a Day
Point Vicente Interpretive (:enter
Come and celebrate the migration of the
Pacific gray whales from Alaska to Baja.
Fun, food, entertainment, education and
lots of things to do. Bring your family and
friends for a unique experience.
Date: Saturday, March 3, 2012
Time: 10:00 .1.111. to 4:00 P.M.
Meet: Free parking at City !fall (30940
Hawthorne Blvd.); catch the tree
shuttle to PVI(: (hist hos leaves PVI(:
at5PM)
Ylw.n..N..1 h1. oho 1 it,' ..I It h.. I\.1... 51 •.1....N.1 I... M....... .h 1\N.N 111.
Whale of a Day
122
CITY OF RANCHO PALOS VERDES
JUNE 30, 2012
INTERNAL SERVICE FUNDS DESCRIPTIONS
The Internal Service Funds are used to finance and account for goods and
services provided by one City department to other City departments on a cost -
reimbursement basis, including depreciation.
Equipment Replacement — to account for purchases, replacement and
maintenance of certain equipment items on behalf of all City departments.
Building Replacement — to account for the accumulation of funds transferred from
the General Fund for replacement of certain buildings on behalf of the City.
Employee Benefits — to account for employee benefit costs for all employees
charged to various City departments.
123
CITY OF RANCHO PALOS VERDES
COMBINING STATEMENT OF NET ASSETS
INTERNAL SERVICE FUNDS
June 30, 2012
ASSETS
Equipment Building Employee
Replacement Replacement Benefits
Totals
CURRENT ASSETS:
Cash and investments $ 2,585,556 $ 942,404 $ - $ 3,527,960
Receivables:
Interest 1,922 603 43 2,568
Other - - 1,081 1,081
Prepaid items 31,342 - 259,731 291,073
TOTAL CURRENT ASSETS 2,618,820 943,007 260,855 3,822,682
NONCURRENT ASSETS:
Capital assets:
Property and equipment 1,603,512 - - 1,603,512
Accumulated depreciation (1,348,661) - - (1,348,661)
TOTAL NONCURRENT ASSETS 254,851 - - 254,851
TOTAL ASSETS 2,873,671 943,007 260,855 4,077,533
LIABILITIES
CURRENT LIABILITIES:
Accounts payable and accrued liabilities 34,732 - 51,598 86,330
Due to other fiend - - 118,514 118,514
TOTAL NONCURRENT ASSETS 34,732 - 170,112 204,844
NET ASSETS
Invested in capital assets 254,851 - - 254,851
Unrestricted 2,584,088 943,007 90,743 3,617,838
TOTAL NET ASSETS $ 2,838,939 $ 943,007 $ 90,743 $ 3,872,689
See independent auditors' report.
124
CITY OF RANCHO PALOS VERDES
COMBINING STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN NET ASSETS - INTERNAL SERVICE FUNDS
For the year ended June 30, 2012
Equipment Building Employee
Replacement Replacement Benefits
Totals
OPERATING REVENUES:
Charges for services $ 480,000 $ - $ 1,821,500 $ 2,301,500
OPERATING EXPENSES:
Personnel services - 1,869,945 1,869,945
Materials and supplies 133,599 20,755 154,354
Maintenance 236,948 - 236,948
Depreciation 133,485 - 133,485
TOTAL OPERATING EXPENSES 504,032 20,755 1,869,945 2,394,732
OPERATING INCOME / (LOSS) (24,032) (20,755) (48,445) (93,232)
NONOPERATING REVENUES:
Other revenues - 28,618 28,618
Investment income 8,244 2,956 219 11,419
TOTAL NONOPERATING REVENUES 8,244 2,956 28,837 40,037
INCOME LOSS BEFORE TRANSFERS (15,788) (17,799) (19,608) (53,195)
TRANSFER OUT (30,517) (340,000) (370,517)
CHANGE IN NET ASSETS (15,788) (48,316) (359,608) (423,712)
TOTAL NET ASSETS - BEGINNING OF YEAR 2,854,727 991,323 450,351 4,296,401
TOTAL NET ASSETS - END OF YEAR $ 2,838,939 $ 943,007 $ 90,743 $ 3,872,689
See independent auditors' report.
125
CITY OF RANCHO PALOS VERDES
COMBINING STATEMENT OF CASH FLOWS
INTERNAL SERVICE FUNDS
For the year ended June 30, 2012
Equipment Building Employee
Replacement Replacement Benefits
CASH FLOWS FROM OPERATING ACTIVITIES:
Receipts from interfiind services provided $ 480,000 $
Payments to suppliers (408,905)
Payments to employees -
NET CASH PROVIDED / (USED)
BY OPERATING ACTIVITIES
- $ 1,940,014
(26,073) -
71,095 (26,073)
(2,039,616)
Totals
$ 2,420,014
(434,978)
(2,039,616)
(99,602) (54,580)
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES
Acquisition and construction of capital assets (134,637) (134,637)
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES:
Receipts from other revenues - 27,537 27,537
Transfer to other funds - (30,517) (340,000) (370,517)
NET CASH USED BY NONCAPITAL
FINANCING ACTIVITIES - (30,517) (312,463) (342,980)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest received on investments 9,018 3,368 976 13,362
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS (54,524) (53,222) (411,089) (518,835)
CASH AND CASH EQUIVALENTS -
BEGINNING OF YEAR 2,640,080 995,626 411,089 4,046,795
CASH AND CASH EQUIVALENTS -
END OF YEAR $ 2,585,556 $ 942,404 $ - $ 3,527,960
RECONCILIATION OF OPERATING LOSS
TO NET CASH USED
BY OPERATING ACTIVITIES:
Operating income / (loss) $ (24,032) $ (20,755) $ (48,445) $ (93,232)
Adjustments to reconcile operating loss to
net cash used by operating activities:
Depreciation 133,485 133,485
Changes in operating assets and liabilities:
Increase (decrease) in prepaid items (31,342) 2,353 (28,989)
Increase (decrease) in accrued liabilities (7,016) (5,318) (172,024) (184,358)
Increase in due to other fund - 118,514 118,514
NET CASH USED
BY OPERATING ACTIVITIES $ 71,095 $ (26,073) $ (99,602) $ (54,580)
See independent auditors' report.
STATISTICAL SECTION
127
AMERICAN CETACEAN SOCIE ' ► J
Ate p: 4 lv �]r 3° Cluse s+ynw. gun+b„kl 2011:m I C.,!s
TODAY'S GRAY WHALES. 3 IZ
Southbound
Northbound
TOTAL WHALES TODAY
OTHER SIGHTINGS
THIS SEASON
FicS 3.2.11
Biqa
oma, t -la -a
Spern
M n!ii; 151- " -t4
SEASON GRAY WHALE TOTALS DOLPHINS
Roes s 3 3-l2
Southbound 64-0 3'3.11
B 3.3.12
Northbound ,O5 Pack MiteSI 3 It
Southbound Cow/Calf Pairs 11 OTHER OBSERVATIONS
Sta osier 3141
Northbound Cow/Calf Pairs
Total Whales Since 12/01/11
5
0
705
The Whale Sighting Count
128
Alm
STATISTICAL SECTION
This part of the City of Rancho Palos Verdes' comprehensive annual financial report presents detailed
information as a context for understanding what the information in the financial statements, note disclosures, and
required supplementary information says about the city's overall financial health.
Contents Page
Financial Trends
These schedules contain trend information to help the reader understand how the City's
financial pei formance and well-being have changed over time.
Revenue Capacity
These schedules contain information to help the reader assess the City's most significant
local revenue source, property tax.
Debt Capacity
These schedules present information to help the reader assess the affordability of the
City's current levels of outstanding debt and the city's ability to issue additional debt in
the future. The City does not have general bond indebtedness or debt issued with pledged
revenue.
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand
the environment within which the City's financial activities take place.
Operating Information
These schedules contain services 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 itpeiforms.
130
138
142
145
148
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual
financial reports for the relevant year.
129
City of Rancho Palos Verdes
Net Assets by Component
Last Ten Fiscal Years
(accrual basis of accounting)
(amounts expressed in thousands)
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Governmental activities
Invested in capital assets $ 94,895 $ 92,499 $ 94,023 $ 109,991 $ 109,746 $ 109,376 $ 107,867 $ 115,331 $ 115,145 $ 114,488
Restricted 10,661 11,586 12,075 12,417 12,163 1,000 1,000 1,000 1,750 1,750
Unrestricted 13,004 14,271 15,659 16,024 17,823 30,471 31,277 31,855 39,066 67,112
Total governmental activities net assets $ 118,560 $ 118,356 $ 121,757 $ 138,432 $ 139,732 $ 140,847 $ 140,144 $ 148,186 $ 155,961 $ 183,351
Business -type activities
Invested in capital assets $ $ - $ $ 1,311 $ 2,158 $ 5,599 $ 12,477 $ 12,458 $ 12,753 $ 13,356
Restricted - - - - - - - -
Unrestricted - 2,000 2,799 5,258 7,740 2,108 2,825 3,365 3,532
Total business -type activities net assets $ - $ - $ 2,000 $ 4,110 $ 7,416 $ 13,339 $ 14,585 $ 15,283 $ 16,118 $ 16,888
Primary government
Invested in capital assets, net of related debt $ 94,895 $ 92,499 $ 94,023 $ 111,302 $ 111,904 $ 114,975 $ 120,344 $ 127,789 $ 127,898 $ 127,845
Restricted 10,661 11,586 12,075 12,417 12,163 1,000 1,000 1,000 1,750 1,750
Unrestricted 13,004 14,271 17,659 18,823 23,081 38,211 33,385 34,680 42,431 70,644
Total primary government net assets $ 118,560 $ 118,356 $ 123,757 $ 142,542 $ 147,148 $ 154,186 $ 154,729 $ 163,469 $ 172,079 $ 200,238
130
City of Rancho Palos Verdes
Changes in Net Assets
Last Ten Fiscal Years
(accrual basis of accounting)
(amounts expressed in thousands)
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Expenses
Governmental activities:
Administration $ 3,294 $ 3,499 $ 4,055 $ 4,350 $ 4,953 $ 4,724 $ 6,357 $ 7,824 $ 5,997 $ 5,906
Public safety 3,094 3,024 3,079 3,437 3,751 4,044 4,233 4,242 4,335 4,178
Public works 7,954 7,462 9,488 9,290 9,969 9,026 10,555 13,633 10,389 11,202
Parks and recreation 809 948 1,065 1,659 1,439 1,396 1,605 1,826 1,391 1,490
Community development 2,170 2,296 2,223 2,060 2,631 2,441 2,697 2,550 2,622 2,432
Non -departmental - - - - 320 - -
lnterest on Tong -term debt 273 273 272 270 271 270 268 265 260 109
Total governmental activities expenses 17,594 17,502 20,182 21,066 23,014 21,901 25,715 30,660 24,994 25,318
Business -type activities:
Water Quality Flood Protection - 47 271 301 437 580 489 560
Total primary govemment expenses $ 17,594 $ 17,502 $ 20,182 $ 21,113 $ 23,285 $ 22,202 $ 26,152 $ 31,240 $ 25,483 $ 25,878
Program Revenues
Governmental activities:
Charges for services:
Administration $ 87 $ 69 $ 62 $ 35 $ 29 $ 538 $ 555 $ 681 $ 654 $ 747
Public safety 235 165 163 224 332 316 267 229 261 194
Public works 252 217 131 37 185 1,002 422 1,356 622 684
Parks and recreation 8 6 41 45 51 483 483 896 457 503
Community development 1,202 1,363 1,188 1,319 1,599 1,760 1,643 1,764 1,714 1,644
Operating grants and contributions 2,971 2,836 2,728 3,894 4,200 3,570 2,963 6,633 3,689 3,628
Capital grants and contributions 131 37 4,524 17,299 317 1,472 642 7,179 5 139
Total governmental activities program revenues 4,886 4,693 8,837 22,853 6,713 9,141 6,975 18,738 7,402 7,538
Business -type activities:
Charges for services:
Water Quality Flood Protection - -
Operating grants and contributions - - -
Capital grants and contributions - -
Total business -type activities program revenues - - -
Total primary government program revenues $ 4,886 $ 4,693 $ 8,837 $ 22,853 $ 6,713 $ 9,141 $ 6,975 $ 18,738 $ 7,402 $ 7,538
Net (expense)/revenue
Governmental activities $ (12,708) $ (12,809) $ (11,345) $ 1,787 $ (16,301) $ (12,760) $ (18,740) $ (1 1,922) $ (17,592) $ (17,780)
Business -type activities - - - (47) (271) (301) (437) (580) (489) (560)
Total primary government net expense $ (12,708) $ (12,809) $ (11,345) $ 1,740 $ (16,572) $ (13,061) $ (19,177) $ (12,502) $ (18,081) $ (18,341)
131
City of Rancho Palos Verdes
Changes in Net Assets
Last Ten Fiscal Years
(accrual basis of accounting)
(amounts expressed in thousands)
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
General Revenues and Other Changes in Net Assets
Governmental activities:
Taxes
Property taxes $ 5,335 $ 5,706 $ 5,840 $ 9,621 $ 10,235 $ 10,935 $ 11,462 $ 11,431 $ 11,854 $ 11,480
Sales taxes 1,003 1,205 1,276 1,214 1,381 1,056 1,053 1,246 1,548 1,449
Franchise taxes 1,087 1,275 1,307 1,454 1,512 1,599 1,709 1,711 1,825 1,881
Utility user taxes 1,832 1,851 1,901 ?,l91 2,271 2,329 2,267 2,395 2,407 2,333
Other taxes 3,495 2,867 4,545 727 363 820 690 2,667 3,454 4,023
Investment income 371 331 594 997 1,615 1,555 631 207 318 604
Other 517 2,481 1,283 793 2,101 300 225 307 271 52
Transfers - (2,000) (2,109) (2,017) (4,719)
Extraordinary item - - 23,348
Total governmental activities 13,640 15,716 14,746 14,888 17,461 13,875 18,037 19,964 21,677 45,170
Business -type activities:
Investment income - 48 51 283 105 14 13 11
User Fees - 1,188 1,222 1,578 1,264 1,312 1,319
Other - 320 -
Transfers - 2,000 2,109 2,017 4,719 -
Total business -type activities - 2,000 2,157 3,576 6,224 1,683 1,278 1,325 1,330
Total primary government $ 13,640 $ 15,716 $ 16,746 $ 17,045 $ 21,037 $ 20,099 $ 19,720 $ 21,242 $ 23,002 $ 46,500
Change in Net Assets
Governmental activities $ 932 $ 2,907 $ 3,401 $ 16,675 $ 1,160 $ 1,115 $ (703) $ 8,042 $ 4,085 $ 27,390
Business -type activities - - 2,000 2,110 3,305 5,923 1,246 698 836 770
Total primary government net expense $ 932 $ 2,907 $ 5,401 $ 18,785 $ 4,465 $ 7,038 $ 543 $ 8,740 $ 4,921 $ 28,159
132
Fiscal Property
Year Tax
2003 $ 5,335
2004 5,706
2005 5,840
2006 9,621
2007 10,235
2008 10,935
2009 11,462
2010 11,431
2011 11,854
2012 11,480
City of Rancho Palos Verdes
Governmental Activities Tax Revenues By Source
Last Ten Fiscal Years
(accrual basis of accounting)
(amounts expressed in thousands)
Utility
Franchise Sales Users Other
Tax Tax Tax Taxes
$ 1,087 $ 1,003 $ 1,832 $ 3,495
1,275 1,205 1,851 2,867
1,307 1,276 1,901 4,545
1,454 1,214 2,191 727
1,512 1,381 2,271 363
1,599 1,056 2,329 820
1,709 1,053 2,267 690
1,711 1,246 2,395 2,667
1,825 1,548 2,407 3,454
1,881 1,449 2,333 4,023
1
Total
$ 12,752
12,904
14,869
15,207
15,762
16,739
17,181
19,450
21,088
21,167
1: Most of the Motor Vehicle In Lieu Tax is received as Property Tax beginning in 2006.
133
City of Rancho Palos Verdes
Fund Balances of Governmental Funds
Last Eight Fiscal Years - Before GASB 54
(modified accrual basis of accounting)
(amounts expressed in thousands)
2003 2004 2005 2006 2007 2008 2009 2010
General Fund
Reserved $ 6,854 $ 6,639 $ 6,021 $ 6,165 $ 6,586 $ 6,645 $ 6,314 $ 7,166
Designated - - 675 876 786 1,278 1,333 1,462
Unreserved, Undesignated 9,607 14,066 14,209 13,649 14,376 12,171 10,440 10,745
Total General Fund $ 16,461 $ 20,705 $ 20,905 $ 20,690 $ 21,748 $ 20,094 $ 18,087 $ 19,373
All other Governmental Funds
Reserved $ 7,584 $ 7,229 $ 3,147 $ 3,315 $ 2,396 $ 2,724 $ 3,672 $ 6,361
Designated
Special Revenue Funds - - 615 744 1,849 1,896 411 85
Capital Projects Funds - - 2,416 2,799 3,158 4,347 6,442 7,494
Permanent Fund - - - 75 65 - -
Debt Service Fund - - - - - - -
Unreserved, Undesignated, reported in:
Special Revenue Funds 5,012 5,040 5,902 6,615 6,426 7,494 7,910 6,058
Capital Projects Funds 534 2,430 3,320 2,077 1,869 1,908 3,373 1,240
Permanent Fund 460 418 426 329 325 371 362 333
Debt Service Fund (10,915) (12,070) (12,793) (13,741) (14,873) (15,990) (16,823) (17,797)
Total all other Governmental Funds $ 2,675 $ 3,047 $ 3,033 $ 2,213 $ 1,215 $ 2,750 $ 5,347 $ 3,774
City of Rancho Palos Verdes
Fund Balances of Governmental Funds
Last Two Fiscal Years - After GASB 54
(modified accrual basis of accounting)
(amounts expressed in thousands)
2011 2012
General Fund
Non -Spendable S 7,515 S 7,493
Restricted -
Committed - -
Assigned
Unassighed 11,385 12,464
Total General Fund S 18,900 S 19,957
All other Governmental Funds
Non -Spendable
Special Revenue Funds S 4,818 S 3,066
Debt Service Fund 573
Capital Projects Funds
Permanent Fund 1,750 1,750
Restricted
Special Revenue Funds 7,952 8,187
Debt Service Fund -
Capital Projects Funds 313
Permanent Fund 319 226
Committed
Special Revenue Funds - -
Debt Service Fund - -
Capital Projects Funds - -
Permanent Fund - -
Assigned
Special Revenue Funds - -
Debt Service Fund
Capital Projects Funds 11,650 15,407
Permanent Fund
Unassigned
Special Revenue Funds (126) (108)
Debt Service Fund (19,687)
Capital Projects Funds -
Permanent Fund
Total all other Governmental Funds S 7,562 S 28,528
135
City of Rancho Palos Verdes
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual basis of Accounting)
(Amounts expressed in thousands)
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Revenues
Taxes $ 11,046 $ 12,081 $ 13,573 $ 15,238 $ 16,453 $ 17,062 $ 17,573 $ 19,844 $ 21,419 $ 21,867
Licenses and permits 1,463 1,310 1,326 1,440 1,763 1,914 1,755 1,954 1,933 1,806
Fines and forfeitures 115 102 108 171 237 260 214 179 210 159
Use of money and property 804 733 1,306 7,038 3,480 2,108 1,240 1,601 1,560 1,350
Charges for services 205 379 152 49 61 60 163 81 73 149
Revenues from other agencies 4,318 3,453 7,848 15,511 4,118 4,647 3,575 10,180 3,162 3,421
Other Revenues 554 2,363 1,038 155 201 1,563 467 4,806 229 259
Total Revenues 18,505 20,421 25,351 39,602 26,313 27,614 24,987 38,645 28,586 29,011
Expenditures
Administration 3,092 3,328 3,852 4,041 4,607 4,411 4,915 5,720 5,503 5,726
Public Safety 3,094 3,039 3,092 3,438 3,751 4,044 4,233 4,242 4,335 4,178
Public Works 5,292 4,801 6,302 5,277 6,864 5,768 7,075 6,896 7,875 7,616
Parks and Recreation 786 946 965 1,593 1,319 1,281 1,354 1,702 1,257 1,479
Community Development 2,194 2,362 2,302 2,361 2,681 2,496 2,723 2,604 2,784 2,484
Non -Departmental - - - - - - - 320 -
Pass Through to other agencies 137 156 188 200 152 169 187 - -
Capital Outlay 3,893 368 4,912 20,202 3,124 3,112 2,459 14,567 2,557 3,155
Debt Service
Principal - - 184 200 248 316 350 419 423 464
Interest 836 805 905 1,150 1,390 1,370 1,101 886 887 498
Total Expenditures 19,324 15,805 22,702 38,462 24,136 22,967 24,397 37,356 25,621 25,599
Excess of Revenues over (under) Expenditures
(819) 4,616 2,649 1,140 2,177 4,647 590 1,289 2,965 3,412
Other Financing Sources (uses)
Sales of capital assets - - - - - - - 350
Transfers in 1,676 1,844 6,180 4,989 4,489 3,158 5,815 4,616 8,944 8,226
Transfers out (1,833) (1,844) (8,180) (7,247) (6,606) (7,924) (5,815) (6,192) (8,944) (7,856)
Bond Proceeds - - - - - - - -
Advances to the Redevelopment Agency - - - - - - - -
Total Other Financing Sources (uses) (157) - (2,000) (2,258) (2,117) (4,766) - (1,576) 350 371
Extraordinary Gain (Loss) - - - - - - - - - 18,240
Net change in Fund Balances $ (976) $ 4,616 $ 649 $ (1,118) $ 60 $ (119) $ 590 $ (287) $ 3,315 $ 22,023
Cost of Assets Capitalized
Debt Services as a percentage of Non -Capital Expenditures
4,184 379 4,623 19,465 2,800 2,764 1,895 10,866 3,180 2,865
5.5% 5.2%
6.0% 7.1%
136
7.7% 8.3%
6.4% 4.9%
5.8% 4.2%
Fiscal Property
Year Tax
2003 5,335
2004 5,706
2005 8,494
2006 9,576
2007 10,385
2008 10,898
2009 11,462
2010 11,431
2011 11,854
2012 11,480
City of Rancho Palos Verdes
General Governmental Tax Revenues By Source
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
(Amounts expressed in thousands)
1
Utility
Franchise Sales Users Other
Tax Tax Tax Taxes Total
1,087 1,003 1,832 1389 11,046
1,275 1,205 1,851 2,044 12,081
1,307 1,009 1,901 862 13,573
1,299 995 2,191 1,177 15,238
1,511 1,020 2,272 1,265 16,453
1,599 1,077 2,329 1,159 17,062
1,709 1,060 2267 1,075 17,573
1,711 1,158 2,395 3,149 19,844
1,825 1,518 2,407 3,815 21,419
1,881 1,452 2,333 4,720 21,867
Source: City General Ledger
1: Most of the Motor Vehicle In Lieu Fees are received as property tax beginning in 2006.
137
City of Rancho Palos Verdes
Assessed Value and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
(In thousands of dollars)
Total Estimated Assessed
Fiscal Less Taxable Direct Actual Factor of Value as a
Year Residential Commercial Industrial Other Unsecured Tax -Exempt Assessed Tax Taxable Taxable Percentage of
End Property Property Property Property Property Property Value Rate (1) Value (2) Assessed Value (3) Actual Value
2003 $ 5,730,464 $ 70,475 $ - $ 191,541 $ 21,741 $ 73,768 $ 6,014,221 0.07317 $ 8,004,026 1.33085 75.14%
2004 6,137,760 74,753 1,660 179,867 22,889 73,701 6,416,930 0.07897 8,539,971 1.33085 75.14%
2005 * 6,530,448 76,445 1,691 317,463 22,222 218,193 6,730,076 0.06400 8,956,722 1.33085 75.14%
2006 * 7,034,406 88,691 3,086 365,175 21,561 218,916 7,294,003 0.06400 9,707,224 1.33085 75.14%
2007 7,548,956 111,338 3,148 513,876 20,378 226,598 7,971,098 0.06370 10,608,336 1.33085 75.14%
2008 7,919,953 170,149 3,211 453,446 26,546 151,225 8,422,080 0.07930 11,208,525 1.33085 75.14%
2009 8,235,780 270,956 3,275 491,235 46,858 154,969 8,893,135 0.07960 11,835,429 1.33085 75.14%
2010 8,333,042 263,157 3,341 598,539 49,628 236,925 9,010,782 0.06370 9,515,593 1.05602 94.69%
2011 8,362,052 396,195 3,333 570,551 45,258 158,388 9,219,001 0.06370 9,067,313 0.98355 101.67%
2012 8,596,777 390,497 3,358 564,763 70,284 157,307 9,468,372 0.06370 10,683,820 1.12837 88.62%
Source: 2010-12 & 2006-07 County Assessor data, MuniServices, LLC
*Assessed values have been revised from prior CAFR publications to comply with GASB No. 44 standards and on-going consistency in reporting methodologies.
(1) Total Direct Tax Rate is represented by TRA 001-224. This percentage is City's shared portion within 1% of County's general levy.
(2) Estimated Actual Value is derived from a series of calculations comparing median assessed values from 1940 to current median sale prices.
Based on these calculations a factor was extrapolated and applied to current assessed values.
(3) The Factor used to calculate Estimated Actual Value was calculated for 2006-07 and applied to prior years for historical purposes.
138
City of Rancho Palos Verdes
Property Tax Rates - Direct and Overlapping Governments
Last Ten Fiscal Years
2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
CITY DIRECT RATE 0.063728 0.063728 0.063728 0.063728 0.063728 0.063728 0.063728 0.063728 0.063728 0.063728
All other direct rates:
LA COUNTY GENERAL 0.230926 0.230926 0.230926 0.230926 0.230926 0.230926 0.230926 0.230926 0.230926 0.230926
LA COUNTY AC'C'UM CAP OUTLAY 0.000112 0.000112 0.000112 0.000112 0.000112 0.000112 0.000112 0.000112 0.000112 0.000112
CONSOL. FIRE PRO.DIST OF LA CO. 0.172592 0.172592 0.172592 0.172592 0.172592 0.172592 0.172592 0.172592 0.172592 0.172592
LA CO. FIRE-FFW 0.006814 0.006814 0.006814 0.006814 0.006814 0.006814 0.006814 0.006814 0.006814 0.006814
LA CO.FL.CON.DR.IMP.DIST.MAINT. 0.001693 0.001693 0.001693 0.001693 0.001693 0.001693 0.001693 0.001693 0.001693 0.001693
LA CO FLOOD CONTROL MAINT 0.009580 0.009580 0.009580 0.009580 0.009580 0.009580 0.009580 0.009580 0.009580 0.009580
PALOS VERDES LIBRARY DIST MAINT 0.018010 0.018010 0.018010 0.018010 0.018010 0.018010 0.018010 0.018010 0.018010 0.018010
LA CO WEST VECTOR CONTROL DIST. 0.000190 0.000190 0.000190 0.000190 0.000190 0.000190 0.000190 0.000190 0.000190 0.000190
CO SANITATION DIST NO 5 OPERAT 0.011975 0.011975 0.011975 0.011975 0.011975 0.011975 0.011975 0.011975 0.011975 0.011975
RANCHO PV LIGHTING MAINT DIST 0.005187 0.005187 0.005187 0.005187 0.005187 0.005187 0.005187 0.005187 0.005187 0.005187
WTR REPLENISHMENT DIST OF SO CAL 0.000171 0.000171 0.000171 0.000171 0.000171 0.000171 0.000171 0.000171 0.000171 0.000171
ERAF 0.075956 0.075956 0.075956 0.075956 0.075956 0.075956 0.075956 0.075956 0.075956 0.075956
EDUCATIONAL AUG FD IMPOUND 0.145328 0.145328 0.145328 0.145328 0.145328 0.145328 0.145328 0.145328 0.145328 0.145328
COUNTY SCHOOL SERVICES 0.001392 0.001392 0.001392 0.001392 0.001392 0.001392 0.001392 0.001392 0.001392 0.001392
CHILDREN'S INSTIL TUITION FUND 0.002763 0.002763 0.002763 0.002763 0.002763 0.002763 0.002763 0.002763 0.002763 0.002763
LA CITY COMM COLLEGE DIST 0.029709 0.029709 0.029709 0.029709 0.029709 0.029709 0.029709 0.029709 0.029709 0.029709
LA COMM COLL CHILDREN'S CTR FD 0.000307 0.000307 0.000307 0.000307 0.000307 0.000307 0.000307 0.000307 0.000307 0.000307
LA UNIFIED SCHOOL DIST 0.218730 0.218730 0.218730 0.218730 0.218730 0.218730 0.218730 0.218730 0.218730 0.218730
CO.SCH.SERV.FD-LOS ANGELES 0.000012 0.000012 0.000012 0.000012 0.000012 0.000012 0.000012 0.000012 0.000012 0.000012
DEV.C'TR.HDC'PD MINOR -LA UNIF. 0.001234 0.001234 0.001234 0.001234 0.001234 0.001234 0.001234 0.001234 0.001234 0.001234
LA CHILDRENS CENTER FD 0.003589 0.003589 0.003589 0.003589 0.003589 0.003589 0.003589 0.003589 0.003589 0.003589
TOTAL 1.000000 1.000000 1.000000 1.000000 1.000000 1.000000 1.000000 1.000000 1.000000 1.000000
Debt Service Rates
COUNTY 0.001030 0.000990 0.000920 0.000800 0.000600 0.000000 0.000000 0.000000 0.000000 0.000000
UNIFIED SCHOOLS 0.052060 0.091910 0.103820 0.103840 0.106800 0.143100 0.145000 0.151809 0.186954 0.168187
COMMNTY COLLEGE 0.014600 0.019860 0.018100 0.014300 0.021400 0.008780 0.022120 0.023112 0.040310 0.035296
PALOS VERDES LIB 0.009700 0.008960 0.008520 0.007810 0.007300 0.013700 0.006800 0.006618 0.006719 0.006359
FLOOD CONTROL 0.000880 0.000470 0.000240 0.000050 0.000000 0.000000 0.000000 0.000000 0.000000 0.000000
METRO WATER DIST 0.006700 0.006100 0.005800 0.005200 0.004700 0.004500 0.004300 0.004300 0.003700 0.003700
TOTAL 0.084970 0.128290 0.137400 0.132000 0.140800 0.170080 0.178220 0.185839 0.237683 0.213542
TOTAL TAX RATE
1.084970 1.128290 1.13 7400 1.132000 1.140800 1.170080 1.178220 1.185839 1.23 7683 1.213 542
Source: 2010-2012 & 2006-07 County Assessor data, MuniServices, LLC
Source: 2008-2009 & 2006 and prior: data is provided from previously published CAFR's.
Los Angeles County Auditor/C'ontroller TRA 001-224
City has no separate debt service rate, direct rate is 100% operating.
139
City of Rancho Palos Verdes
Principal Property Tax Payers
Last Fiscal Year and Nine Years Ago
2011-12 2002-03
Percentage of Percentage of
Taxable Total City Taxable Taxable Total City Taxable
Taxpayer Value ($) Rank Value (%) Value ($) Rank Value (%)
Long Point Development LLC 331,377,907 1 3.50%
PPC Villas RPV LLC 64,189,287 2 0.68%
VH Property Corp 54,605,177 3 0.58%
P V Victoria Apts LLC 47,055,126 4 0.50%
Terraces Rancho Palos Verdes 35,413,270 5 0.37%
Western Riviera Investors 28,966,800 6 0.31%
Golden Cove LLC 26,607,901 7 0.28%
Terranea Resort 24,459,679 8 0.26%
BVF II Madison LLC 23,069,957 9 0.24%
Cox Communications Inc. 22,735,148 10 0.24%
Belmont Village RPV LP 22,399,961 11 0.24%
Johnson Eric C 15,951,715 12 0.17%
Tridiamond LLC 13,411,749 13 0.14%
California Water Service Co 10,246,488 14 0.11%
Kariger Brian P 8,392,935 15 0.09%
Victoria Apartments 7,821,788 16 0.08%
Palos Verdes Terrace LTD 7,661361 17 0.08%
Saitta Christopher L 6,599,181 18 0.07%
Amdan Investment LLC Lessee 6,550,000 19 0.07%
Gerts Igor Anna 6,463,000 20 0.07%
Labarba James G 6,133,098 21 0.06%
Imbach Scott A & Diane Y 6,022,988 22 0.06%
Clow Leland E Ilene F 5,880,699 23 0.06%
HSU Tong H 5,866,730 24 0.06%
Kip Holding Inc. 5,602,022 25 0.06%
Ocean Trails L P 58,479,923 1 0.99%
P V Victoria Apts LLC 40,814,540 2 0.69%
RPV Associates LLC 36,749,705 3 0.62%
Connecticut General Life 28,085,261 4 0.48%
Western Riviera Investors 24,853,212 5 0.42%
York Long Point Assoc 22,010,505 6 0.37%
Gardner Theodore R 13,528,404 7 0.23%
Salvation Army 13,456,653 8 0.23%
Top Terraces Inc. 12,444,000 9 0.21%
Victoria Apartments 6,785,826 10 0.11%
Braun William 6,720,000 I I 0.11%
Donahue Schriber Reality Group 5,942,764 12 0.10%
MVI Corp 5,505,795 13 0.09%
Labarba James G 5,318,862 14 0.09%
Chung David W 4,991,000 15 0.08%
Foster Robert D & Gina D 4,820,760 16 0.08%
Briles Richard & Keanna 4,681,800 17 0.08%
Bradford Edward T & Paullee G 4,536,524 18 0.08%
Hoffman John C & Paula J 4,467,440 19 0.08%
Moshfeghi Mehran 4,251,500 20 0.07%
Yeong Yae Kim 4,19? 000 21 0.07%
Levine Irving 4,155,004 22 0.07%
Marino Joseph C & Kimberly 3,937,200 23 0.07%
Hill John W Elizabeth d TRS 3,834,208 24 0.06%
Pemba Properties Inc. 3,826,430 25 0.06%
Total Top 25 Taxpayers $ 793,484,967 8.38% $ 328,389,316 5.56%
Total Taxable Value $ 9,468,371445 100.00% $ 5,908,898,049 100.00%
Source: Los Angeles County Assessor data, MuniServices, LLC
140
City of Rancho Palos Verdes
Property Tax Levies and Collections
Last Eight Fiscal Years
(amounts expressed in thousands)
Collected within the
Total Tax Fiscal Year of the Levy Total Collections to Date
Fiscal Levy for Percentage Collections in Percentage
Year Fiscal Year Amount of Levy Subsequent Years Amount of Levy
2005 $ 4,284 $ 4,001 93.40% $ 144 $ 4,145 96.76%
2006 4,643 4,506 97.06% 36 4,542 97.83%
2007 5,078 4,799 94.51% 10 4,809 94.70%
2008 5,351 5,316 99.35% 10 5,326 99.53%
2009 6,116 5,734 93.76% 8 5,742 93.88%
2010* 5,447 4,917 90.27% 8 4,925 90.42%
2011* 5,597 5,462 97.59% 8 5,470 97.73%
2012 5,777 5,656 97.91% 8 5,664 98.04%
Source: County Assessor Data and City General Ledger
* Includes 1% secured apportionment only
The detailed information presented in this table was not obtained by the City for fiscal years prior to 2005, and
is therefore unavailable.
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Fiscal
Year
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012(1)
City of Rancho Palos Verdes
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
(Amounts expressed in thousands, except per capita amount)
Governmental Activities
RDA
Tax Increment
Bond
5,455
5,455
5,450
5,435
5,410
5,370
5,315
5,250
5,165
5,065
RDA
Deferred Interest
Payable
3,111
3,111
2,469
2,284
2,061
1,786
1,491
1,136
798
435
Total Debt
Primary Per
Government Capita
8,566 202.40
8,566 200.09
7,919 181.94
7,719 179.55
7,471 173.37
7,156 166.56
6,806 159.32
6,386 149.76
5,963 142.77
5,500 131.27
Ratio of Debt
to Property
Value
0.11%
0.10%
0.09%
0.08%
0.07%
0.06%
0.06%
0.07%
0.07%
0.05%
Ratio of Debt
to Personal
Total income
0.0004372%
0.0004322%
0.0003567%
0.0003520%
0.0003399%
0.0003008%
0.0002838%
0.0002458%
0.0002148%
Source: City Financial Records
(1) Effective February 1, 2012, the Redevelopment Agency was dissolved as a result of legislation enacted by the State of
California. All debt was transferred to a successor agency that is winding up the affairs of the Revelopment Agency. This
debt is no longer on obligation of the primary government.
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City of Rancho Palos Verdes
Direct and Overlapping Governmental Activities Debt
Current Year
Total Debt City's Share of
DIRECT DEBT: 6/30/2012 % Annlicable (1) Debt 6/30/12
City of Rancho Palos Verdes 0 100.000°-o 0
Total Debt City's Share of
DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT: 6/30/2012 % Annlicable (1) Debt 6/30/12
Los Angeles County Flood Control District $37,195.000 1.038% $386,084
Metropolitan Water District 196,545,000 0.523°-o 1,027,930
Los Angeles Community College District 3.504,910.000 1.798% 63,018,282
Los Angeles Unified School District 11,279,905.000 0.216% 24,364,595
Palos Verdes Unified School District 79,376.639 47.515% 37.715,810
Palos Verdes Library District 5,575.000 50.082% 2.792,072
Los Angeles County Regional Park and Open Space Assessment District 170,725,000 1.016°o 1,734,566
SUBTOTAL OVERLAPPING TAX AND ASSESSMENT DEBT 131,039,339
OVERLAPPING GENERAL FUND DEBT:
Los Angeles County General Fund Obligations
Los Angeles County Superintendent of Schools Certificates of Participation
Los Angeles County Sanitation District No. 5 Authority
Los Angeles County South Bay Cities Sanitation District Authority
Los Angeles Unified School District Certificates of Participation
SUBTOTAL GROSS OVERLAPPING GENERAL FUND DEBT
Less: Los Angeles County General Fund Obligations supported by landfill revenues
Los Angeles Unified School District QZABs supported by investment fund
SUBTOTAL NET OVERLAPPING GENERAL FUND DEBT
$1.474,122.758
11,269.678
49,899.761
8.501,885
419,851.037
1.016°o
1.016°o
11.177%
4.514°-o
0.216%
$14,977,087
114,500
5.577,296
383,775
906.878
$21,959,536
169.653
9,523
21,780,360
TOTAL DIRECT DEBT $0
GROSS COMBINED SUBTOTAL OVERLAPPING DEBT $152.998,875 (2)
NET COMBINED SUBTOTAL OVERLAPPING DEBT $152.819,699
GROSS COMBINED TOTAL DEBT $152.998,875
NET COMBINED TOTAL DEBT $152.819,699
(1) The percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable percentages were estimated
by determining the portion of the overlapping government's taxable assessed value that is within the City's boundaries and dividing it by the
overlapping government's total taxable assesed value.
(2) Excludes tax and revenue anticipation notes, revenue, mortgage revenue and tax allocation bonds and non -bonded capital lease obligations.
2011-12 Assessed Valuation:
Redevelopment Incremental Valuation:
Adjusted Assessed Valuation:
Ratios to 2011-12 Assessed Valuation:
Direct Debt
Total Direct and Overlapping Tax and Assessment Debt
Ratios to Adiusted Assessed Valuation:
Gross Combined Total Debt
Net Combined Total Debt
9,545,121, 701
114.494.354
$9,430,627.347
0.00%
1.37%
1.62%
1.62%
STATE SCHOOL BUILDING AID REPAYABLE AS OF 6'30'12: $0
Source: 2011-12 California Municipal Statistical Co.
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City of Rancho Palos Verdes
Legal Debt Margin Information
Last Ten Fiscal Years
(Amounts expressed in thousands)
Fiscal Year
2003 2004 2005 2006 2007
2008 2009 2010 2011 2012
Debt Limit $ 902,133 $ 962,539 $ 1,021,177 $ 1,105,647 $ 1,195,665 $ 1,274,916 $ 1,345,594 $ 1,351,617 $ 1,382,850 $ 1,420,256
Total Net Debt applicable to limit
Legal Debt Margin $ 902,133 $ 962,539 $ 1,021,177 $ 1,105,647 $ 1,195,665 $ 1,274,916 $ 1,345,594 $ 1,351,617 $ 1,382,850 $ 1,420,256
Total Net Debt applicable to the limit
as a percentage of Debt Limit
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
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Total Taxable Value (see page 133) $ 9,468,372
Debt Limit (15%oftotal taxable value) 1,420,256
Debt applicable to limit
Legal Debt Margin $ 1,420,256
City of Rancho Palos Verdes
Demographic and Economic Statistics
Last Ten Fiscal Years
Per Capita **Public County City City
Fiscal Personal Personal Median School Unemployment Unemployment County Population
Year Population (l) Income (2) Income (2) Age (4) Enrollment Rate (%) (3) Rate (%) (3) Population (1) (% of County)
2002-03 42,322 1,959,254,668 46.294 44.7 - - -
2003-04 42,810 1,981,846,140 46.294 44.7 - -
2004-05 43,525 2,219,905,575 51.003 43.4 - - 1.50%
2005-06 42,991 2,192,669,973 51.003 43.4 - - 1.50%
2006-07 43,092 2,197,821,276 51.003 43.4 - - 1.50%
2007-08 42,964 - - - - - -
2008-09 42,720 '1:10,493,9'10 52.961 43.4 12,033 7.5% 2.5% 10,301,658 0.41%
2009-10 42,642 2,250,346,266 52.773 44.9 11,900 11.6% 4.0% 10,355,053 0.41%
2010-11 41,766 2,425,936,344 58.084 44.3 11,928 11.9% 4.1% 9,858,989 0.42%
2011-12 41,897 2,561,016,971 61.127 47.6 11,840 11.1% 3.8% 9,884,632 0.42%
Source: 2011-12 MuniServices, LLC
1.) Population Projections are provided by the California Department of Finance Projections.
2.) Income Data is provided by the US Census Bureau, 2010 American Community Survey.
3.) Unemployment Data is provided by the EDD's Bureau of Labor Statistics Department.
**Student Enrollment reflects the total number of students enrolled in the Palos Verdes Unified
School District. Other school districts within the City are not included.
The California Department of Finance demographics estimates now incorporate 2010 Census
counts as the benchmark. Therefore, the estimates for 2010-2012 published in this report might be
noticeably different from the previous year estimates
145
2011-12
Taxpayer
7 -Eleven Food Stores
Admiral Risty Restaurant
America's Tire
Carl's Jr. Restaurant
Centinela Feed & Pet Supplies Inc
Chevron Service Stations
Coco's Restaurants Inc.
Denny's Restaurant
El Pollo Loco Inc.
Good Night Mattress
Green Hills Memorial Park Inc.
Green Hills Mortuary
Hughes Markets
IHOP Restaurants
Jack In The Box Restaurants
Los Verdes Country Club
Marie Callender Restaurant
Marshalls
Mobil Service Stations
O'Reilly Auto Parts
Smart & Final
Swank Audio Visuals
Terranea Resort
Trader Joe's
VH Property Corp.
City of Rancho Palos Verdes
Principal Sales Tax Producers
Last Fiscal Year and Nine Years Ago
Business Type
Food Markets
Restaurants
Auto Parts/Repair
Restaurants
Miscellaneous Retail
Service Stations
Restaurants
Restaurants
Restaurants
Furniture/Appliance
Miscellaneous Other
Miscellaneous Other
Food Markets
Restaurants
Restaurants
Restaurants
Restaurants
Apparel Stores
Service Stations
Auto Parts/Repair
Food Markets
Electronic Equipment
Restaurants
Food Markets
Miscellaneous Retail
Source: SHOE data, MuniServices, LLC
Top Sales Tax Producers listed in alphabetical order.
2002-03
Taxpayer
Admiral Risty Restaurant
Albertson's Food Centers
America's Tire
Bay Cities Vacuum Sew & Carpet
California Do It Center
Carl's Jr. Restaurant
Chevron Service Stations
Coco's Restaurants Inc
Discount Tire
El Pollo Loco Inc
Fedex Office
Green Hills Memorial Park Inc.
Green Hills Mortuary
Hughes Markets
Jack In The Box Restaurants
Los Verdes Country Club
Marie Callender Restaurant
Mobil Service Stations
New York Food & Catering
Ocean Trails Golf Club
O'Reilly Auto Parts
Pacific Crown Service Station
Salvation Army
Trader Joe's
VH Property Corp.
146
Business Type
Restaurants
Food Markets
Auto Parts/Repair
Furniture/Appliance
Bldg.Matls-Retail
Restaurants
Service Stations
Restaurants
Auto Parts/Repair
Restaurants
Miscellaneous Retail
Miscellaneous Other
Miscellaneous Other
Food Markets
Restaurants
Restaurants
Restaurants
Service Stations
Restaurants
Restaurants
Auto Parts/Repair
Service Stations
Furniture/Appliance
Food Markets
Miscellaneous Retail
City of Rancho Palos Verdes
Principal Employers
Current Year and Three Years Ago
2012 2009
Percentage Percentage
of Total City of Total City
Employer Employees Rank Employment Employees Rank Employment
Palos Verdes Peninsula Unified School District 1,970 1 9.43%
Terranea Resort Hotel 730 2 3.49%
Trump National (1) 260 3 1.24%
Marymount College 320 4 1.05%
Keller Williams Realty 163 5 0.78%
Canterbury 115 6 0.55%
Belmontcorp LTD 111 7 0.53%
Trader Joe's 88 8 0.42%
Ralphs 83 9 0.40%
Green Hills Memorial Park 80 10 0.38%
Palos Verdes Peninsula Unified School District 1970 1 9.56%
Terranea Resort Hotel 730 2 3.54%
Trump National 300 3 1.46%
Marymount College 195 4 0.95%
Ralphs 115 5 0.56%
Keller Williams Realty 112 6 0.54%
Belmontcorp Ltd 94 7 0.46%
Green Hills Memorial Park 85 8 0.41%
American Golf Corp 70 9 0.34%
St. John Fishers 50 10 0.24%
Subtotal of Principal Employers 3,820 18.28% 3,721 18.06%
Total City Employment (2) 20,900 20,600
Source: MuniServices, LLC
Results based on direct correspondence with city's local businesses.
(1) Includes full time and part time employees.
(2) Total City Employment provided by EDD Labor Force Data.
147
City of Rancho Palos Verdes
Full-time Equivalent City Government Employees by Function
Last Ten Fiscal Years
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Fu nction
General Government 45 45 45 47 50 55 58 53 54 52
Recreation Part -Time 10 10 10 10 10 10 11 17 18 17
Total 55 55 55 57 60 65 69 70 72 69
Source: City Budget documents and Payroll records
148
City of Rancho Palos Verdes
Operating Indicators by Function
Last Ten Fiscal Years
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Function
Administration
Employee Resignations - 5 4 4 4 8 4 9 5 8
Workers Compensation Claims 2 2 3 4 2 4 2 5 3 3
Liability Claims 14 14 18 31 14 16 13 13 14 11
Budget Adjustments 30 27 36 48 32 26 18 21 17 11
Business Licenses Issued 1.961 2.102 1.909 1.801 1.837 1.709 1.819 1.629 1.891 1.294
Web Site Page Views 119,104 133,481 224,777 1.3 mil 1.6 mil 701,004 3.8 mil 2.9 mil 2.8mi1 3.0mi1
Public Safety
Part I Crime Rates (per 10.000 population) 122 122 101 120 139 123 102 110 137.85 139.52
Public Works
Solid Waste Diversion Rates (1) 5790 61% 59% 55% 56% 4.71bs/person/day 4.11bs/person/day 4.21bs/person/day 4.21bs/person/day 4.21bs/person/day
Pavement Rating 80 89 89 82 82 DNA 84.5 84.5 84.5
Parks and Recreation
Park Events 915 825 780 937 770 692 825 690 580 582
Class Meetings at Parks 2.134 2.935 2.893 2.856 2.647 2.772 2.708 2.398 2.313 1.587
Docent Led Nature Hikes 45 80 65 62 98 91 105 103 105 104
Community Development
Building Permits Processed 1.327 1.399 1.233 1.382 1.244 1.692 1.404 1.243 1.432 1.221
Plan Checks 150 186 208 163 164 247 226 154 161 161
Municipal Code Violations Closed 203 214 180 159 162 216 339 138 371 321
Source: City Departments
DNA: Data Not Available
(1): A new system of measuring AB939 compliance was implemented in 2008 with the passage of SB 1016. This changed the previous diversion calculation method to the new disposal -based indicator - the
per capita disposal rate. The per capita disposal target is based on the average of 50 percent of generation in 2003 through 2006, expressed in terms of per capital disposal.
149
City of Rancho Palos Verdes
Capital Asset Statistics by Function
Last Ten Fiscal Years
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Function
Administration
Computer Workstations DNA DNA 81 81 85 91 92 101 92 88
Public Safety (1)
Public Works
Street Miles 143 143 143 143 143 143 143 143 143 144
Traffic Signals 15 15 15 15 15 16 16 16 16 18
Parks and Recreation
Parks 15 15 15 16 16 16 16 15 15 15
Community Development
Vehicles Used for Inspections
3 3 3 3 3 5 5 5 5 5
Source: City Capital Asset Records
DNA: Data Not Available
(1): Public safety services are contracted with other agencies. The City does not own any public safety capital assets.
150