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2025-01-21 Agenda Packet
IN-PERSON PUBLIC PARTICIPATION: Members of the public are welcome to attend City Council meetings in person. Alternate ways to view meetings live or on-demand include: livestreamed on HBTV Channel 3 (replayed on Wednesday at 10:00 a.m. and Thursday at 6:00 p.m.); live and archived meetings for on-demand viewing accessed from https://huntingtonbeach.legistar.com/calendar , https://bit.ly/SurfCityTV, or the City's YouTube Channel at https://www.youtube.com/cityofhb , or from any Roku, Fire TV or Apple device by downloading the Cablecast Screenweave App and searching for the City of Huntington Beach channel. PRESENTATION MATERIAL: Presentations/AV materials shall be submitted to staff no later than 9AM the day of the meeting to PublicPresentations@huntingtonbeachca.gov . Members of the audience and speakers shall not wear or display signs that obstruct the view of other audience members. Signs shall remain with the holder and shall not be placed in adjacent seats or in common areas. PUBLIC COMMENTS: Individuals wishing to provide a comment on agendized or non-agendized items including Study Session, Closed Session, and Public Hearing, may do so in person in the City Council Chambers by completing a Request to Speak form delivered to the City Clerk. Sign-ups to Request to Speak will begin in person 30 minutes prior to the start of Study Session, Closed Session, or Regular City Council Meeting, whichever comes first. Sign-ups will be accepted until the commencement of the public comment period. SUPPLEMENTAL COMMUNICATION: Members of the public unable to personally participate in the meeting but interested in communicating with the City Council on agenda-related items are encouraged to submit a written (supplemental) communication to the Council via email at SupplementalComm@Surfcity-hb.org . Supplemental Communications are public record, and if received by 9:00 AM on the day of the meeting, will be distributed to the City Council prior to consideration of agenda-related items, posted to the City website, and announced, but not read, at the meeting. Communications received after the 9:00 AM deadline will be incorporated into the administrative record. Members of the public are also welcome to communicate with the City Council (and staff supporting Council) at City.Council@surfcity-hb.org . MEETING ASSISTANCE NOTICE: In accordance with the Americans with Disabilities Act, services are available to members of our community who require special assistance to participate in public meetings. If you require special assistance, 48-hour prior notification will enable the City to make reasonable arrangements for an assisted listening device (ALD) for the hearing impaired, American Sign Language interpreters, a reader during the meeting and/or large print agendas. Please contact the City Clerk's Office at (714) 536-5227 for more information. AGENDA City Council/Public Financing Authority Tuesday, January 21, 2025 Special Meeting of the Successor Agency Closed Session - 3:30 PM Study Session - 4:45 PM Regular Meeting - 6:00 PM Council Chambers 2000 Main Street Huntington Beach, CA 92648 MAYOR AND CITY COUNCIL PAT BURNS, Mayor CASEY MCKEON, Mayor Pro Tem DON KENNEDY, Councilmember TONY STRICKLAND, Councilmember BUTCH TWINING, Councilmember GRACEY VAN DER MARK, Councilmember CHAD WILLIAMS, Councilmember STAFF TRAVIS HOPKINS, Acting City Manager MICHAEL E. GATES, City Attorney LISA LANE BARNES, City Clerk ALISA BACKSTROM, City Treasurer 1 AGENDA January 21, 2025City Council/Public Financing Authority 3:30 PM - COUNCIL CHAMBERS CALL TO ORDER ROLL CALL Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, Williams Councilmembers Strickland and Van Der Mark have requested permission to be absent pursuant to Resolution No. 2001-54. ANNOUNCEMENT OF SUPPLEMENTAL COMMUNICATIONS (Received After Agenda Distribution) PUBLIC COMMENTS (3-Minute Time Limit) At this time, the City Council will receive comments from members of the public regarding any topic, including items on the Closed Session agendas. Individuals wishing to provide a comment on item(s) may do so in person by filling out a Request to Speak form delivered to the City Clerk. All speakers are encouraged, but not required to identify themselves by name. Each speaker may have up to 3 minutes unless the volume of speakers warrants reducing the time allowance. Please note that the Brown Act does not allow discussion or action on topics that are not on the agenda. Members of the public who would like to speak directly with a Councilmember on an item not on the agenda may consider scheduling an appointment by contacting the City Council's Administrative Assistant at (714) 536-5553 or emailing the entire City Council at city.council@surfcity-hb.org. RECESS TO CLOSED SESSION CLOSED SESSION 25-0231.CONFERENCE WITH LABOR NEGOTIATORS (Gov. Code section 54957.6.) Agency designated representatives: Travis Hopkins, Acting City Manager; also in attendance: Marissa Sur, Director of Human Resources; Michael E. Gates, City Attorney and David Cain, Interim Chief Financial Officer. Employee Organization: Huntington Beach Municipal Teamsters (HBMT). 25-0242.CONFERENCE WITH LABOR NEGOTIATORS (Gov. Code section 54957.6.) Agency designated representatives: Travis Hopkins, Acting City Manager; also in attendance: Marissa Sur, Director of Human Resources; Michael E. Gates, City Attorney and David Cain, Interim Chief Financial Officer. Employee Organization: Management Employees' Organization (MEO). Page 1 of 8 2 AGENDA January 21, 2025City Council/Public Financing Authority 25-0263.CONFERENCE WITH LABOR NEGOTIATORS (Gov. Code section 54957.6.) Agency designated representatives: Travis Hopkins, Acting City Manager; also in attendance: Marissa Sur, Director of Human Resources; Michael E. Gates, City Attorney and David Cain, Interim Chief Financial Officer. Employee Organization: Marine Safety Management Association (MSMA). 25-0274.PUBLIC EMPLOYEE APPOINTMENT (Gov. Code section 54957(b)(1).) Title: City Manager. 25-0315.CONFERENCE WITH LEGAL COUNSEL-ANTICIPATED LITIGATION (Gov. Code section 54956.9(d)(4).): One (1). 25-0326.CONFERENCE WITH LEGAL COUNSEL-EXISTING LITIGATION. (Paragraph (1) of subdivision (d) of Section 54956.9). City of Huntington Beach, et al. v. State of California, et al. (SB54); USDC Case No.: 8:25-cv-00026. RECONVENE CITY COUNCIL/PUBLIC FINANCING AUTHORITY MEETING ROLL CALL Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, Williams Councilmembers Strickland and Van Der Mark have requested permission to be absent pursuant to Resolution No. 2001-54. ANNOUNCEMENT OF SUPPLEMENTAL COMMUNICATIONS (Received After Agenda Distribution) PUBLIC COMMENTS (3-Minute Time Limit) At this time, the City Council will receive comments from members of the public regarding any topic, including items on the Study Session agenda. Individuals wishing to provide a comment on item(s) may do so in person by filling out a Request to Speak form delivered to the City Clerk. All speakers are encouraged, but not required to identify themselves by name. Each speaker may have up to 3 minutes unless the volume of speakers warrants reducing the time allowance. Please note that the Brown Act does not allow discussion or action on topics that are not on the agenda. Members of the public who would like to speak directly with a Councilmember on an item not on the agenda may consider scheduling an appointment by contacting the City Council's Administrative Assistant at (714) 536-5553 or emailing the entire City Council at city.council@surfcity-hb.org. STUDY SESSION Page 2 of 8 3 AGENDA January 21, 2025City Council/Public Financing Authority 25-0087.Infrastructure Report Card 24-9178.The Marisol Senior Living Project Financing 6:00 PM – COUNCIL CHAMBERS RECONVENE CITY COUNCIL/PUBLIC FINANCING AUTHORITY MEETING AND CALL TO ORDER THE SPECIAL MEETING OF THE SUCCESSOR AGENCY ROLL CALL Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, Williams Councilmembers Strickland and Van Der Mark have requested permission to be absent pursuant to Resolution No. 2001-54. PLEDGE OF ALLEGIANCE INVOCATION In permitting a nonsectarian invocation, the City does not intend to proselytize or advance any faith or belief. Neither the City nor the City Council endorses any particular religious belief or form of invocation. 25-0059.Huntington Beach Police Chaplain Bob Ewing CLOSED SESSION REPORT BY CITY ATTORNEY CITY COUNCIL MEMBER COMMENTS (2-Minute Time Limit) The Mayor will facilitate a voluntary opportunity for members of the Huntington Beach City Council to individually make brief comments to the public. Please note that the Brown Act does not allow for lengthy comments, discussion, or action on topics that are not on the agenda. ANNOUNCEMENT OF SUPPLEMENTAL COMMUNICATIONS (Received After Agenda Distribution) PUBLIC COMMENTS (3-Minute Time Limit) At this time, the City Council will receive comments from members of the public regarding any topic, including items on the open session agenda. Individuals wishing to provide a comment may do so in person by filling out a Request to Speak form delivered to the City Clerk. All speakers are encouraged, but not required to identify themselves by name. Each speaker may have up to 3 minutes unless the volume of speakers warrants reducing the time allowance. Please note that the Brown Act does not allow discussion or action on topics that are not on the agenda. Members of the public who would like to speak directly with a Councilmember on an item not on the agenda may consider scheduling an appointment by contacting the City Council's Page 3 of 8 4 AGENDA January 21, 2025City Council/Public Financing Authority Administrative Assistant at (714) 536-5553 or emailing the entire City Council at city.council@surfcity-hb.org. While the City Council welcomes public involvement and supports and defends free speech, the City Council rejects comments from anyone that are discriminatory, defamatory or otherwise not protected free speech. Those comments will not inform nor be considered by the City Council and may be cause for the Mayor to interrupt the public speaker. Such public comments will not be consented to or otherwise adopted by the City Council in its discussions and findings for any matter tonight. COUNCIL COMMITTEE APPOINTMENT ANNOUNCEMENTS Councilmembers may make brief announcements on any appointments made to a board, committee, or commission. Councilmembers may not discuss or take any action on these announcements. Announcements are limited to 1 minute. AB 1234 REPORTING Per AB 1234 (Government Code Section 53232.3(d)) Councilmembers who attend a meeting, conference, or similar event at the expense of the City must provide a brief report of the meeting, conference, or similar event during the next regular City Council meeting. Reports are limited to 1 minute. OPENNESS IN NEGOTIATION DISCLOSURES Councilmembers must publicly disclose any meetings or communications with City employee associations, related to the negotiations of labor agreements. Disclosures are limited to 1 minute and must be made by the next regular City Council Meeting. CITY MANAGER'S REPORT 25-02210.Update of Huntington Beach’s Support for LA Fire Relief Efforts CONSENT CALENDAR (Items 11-15) City Clerk 24-85311.Annual Review of the City Code of Ethics Direct the City Clerk to record in the official minutes that the City Code of Ethics was presented to the City Council, City Manager, Chairpersons, and City Department Directors for their review and distribution as required by Resolution No. 2016-73. Recommended Action: 25-01512.Approve and Adopt Minutes Approve and adopt the City Council/Public Financing Authority regular meeting and the Housing Authority, Parking Authority and Successor Agency special meeting minutes of Recommended Action: Page 4 of 8 5 AGENDA January 21, 2025City Council/Public Financing Authority December 17, 2024. Fire 24-94113.Approve and authorize execution of Amendment No. 2 with Excalibur Well Services, Corp; approve additional funding and appropriation of funds for the Civic Center Oil Well Abandonment Project. A) Approve and authorize the Mayor and City Clerk to execute “Amendment No. 2 to Service Agreement between the City of Huntington Beach and Excalibur Well Services, Corp. for Civic Center Well Abandonment;” and B) Approve an appropriation and transfer of $498,500 in HB Recovery Funds to Oil Well Abandonment business unit 31465001.82800. Recommended Action: Finance 24-91814.Year-End Audit Results for the FY 2023/24 Annual Comprehensive Financial Report (ACFR) and Approval of Fiscal Year 2023/24 Year-End Audit Adjustments A) Receive and File the FY 2023/24 Annual Comprehensive Financial Report and other auditor-issued reports; and, B) Approve year-end budget adjustments to the FY 2023/24 Revised Budget in the funds and by the amounts contained in Attachment 3 . Recommended Action: Public Works 24-93315.Approve and accept the California State Water Resources Control Board (SWRCB) grant for the Old Pirate Lane State Small Water System Consolidation Project, CC-1624, and approve appropriation of funds A) Approve and authorize the Public Works Director to accept the State Water Resources Control Board (SWRCB) grant for $327,947; and, B) Approve appropriation of grant award funding of $327,947 into the SWRCB Old Pirate Lane business unit 130291001.82100; and, C) Approve appropriation of $250,053 into business unit 50691049.82100. Recommended Action: Page 5 of 8 6 AGENDA January 21, 2025City Council/Public Financing Authority ADMINISTRATIVE ITEMS 24-91616.FY 2023-2027 Strategic Plan - Biannual Progress Update #3 Receive and file the FY 2023-2027 Strategic Plan - Biannual Progress Update #3. Recommended Action: 24-92917.Adopt Successor Agency Resolution Nos. 2025-01 and 2025-02 approving the Recognized Obligation Payment Schedule (ROPS) and Administrative Budget for the Huntington Beach Successor Agency for the period of July 1, 2025, through June 30, 2026, in accordance with Health and Safety Code Section 34177 and related actions A) Adopt Resolution No. 2025-01, “A Resolution of the Successor Agency to the Redevelopment Agency of the City of Huntington Beach Approving the Recognized Obligation Payment Schedule for the Period July 1, 2025 - June 30, 2026 (‘ROPS 25- 26’);” and B) Adopt Resolution No. 2025-02, “A Resolution of the Successor Agency to the Redevelopment Agency of the City of Huntington Beach Approving the Successor Agency Administrative Budget for the Period July 1, 2025, through June 30, 2026 .” Recommended Action: 24-79718.Petition to repeal Ordinance No. 4318 Deleting Huntington Beach Municipal Code Chapter 2.66 - Community-Parent Guardian Review Board for Procurement of Children’s Library Materials, and Adding Section 2.30.090 - Selection and Use of Library Materials A) Adopt Resolution No. 2025-04, “A Resolution of the City Council of the City of Huntington Beach Accepting the Certificate as to Verification of Signatures on Petition from the Orange County Registrar of Voters Regarding the Initiative Petition Entitled “An Ordinance to Amend the Huntington Beach Municipal Code by Deleting Chapter 2.66 Thereof Entitled ‘Community Parent Guardian Review Board for Procurement of Children’s Library Materials’ and Adding Section 2.3 0.090 Thereto Entitled ‘Selection and Use of Library Materials;’” and, B) Order a “Report of Effect of Proposed Initiative” pursuant to California Elections Code Section 9212, presented to the City Council within the timeframe described, but no later than 30 days after the elections official certifies to the City Council the sufficiency of the petition . Recommended Action: 25-03319.Petition for An Ordinance to Amend the Huntington Beach Municipal Page 6 of 8 7 AGENDA January 21, 2025City Council/Public Financing Authority Code by Adding New Section 2.30.100, Entitled “Public Operation of Library Services” A) Adopt Resolution No. 2025-03, “A Resolution of the City Council of the City of Huntington Beach Accepting the Certificate as to Verification of Signatures on Petition from the Orange County Registrar of Voters Regarding the Initiative Petition Entitled “An Ordinance to Amend the Huntington Beach Municipal Code by Adding New Section 2.30.100, Entitled ‘Public Operation of Library Services;’” and, B) Order a “Report of Effect of Proposed Initiative” pursuant to California Elections Code Section 9212, presented to the City Council within the timeframe described, but no later than 30 days after the elections official certifies to the City Council the sufficiency of the petition. Recommended Action: COUNCIL MEMBER ITEMS 24-88220.Item Submitted by Mayor Pat Burns - Adopt Resolution No. 2025-01 declaring the City to be a non-sanctuary city for illegal immigrants for the prevention of crime Adopt Resolution No. 2025-01 “A Resolution of the City Council of the City of Huntington Beach, California, Declaring the City of Huntington Beach a Non-Sanctuary City for Illegal Immigration for the Prevention of Crime.” Recommended Action: 25-03421.Item Submitted by Mayor Pat Burns, Mayor Pro Tem Casey McKeon, and Council Member Don Kennedy - Bolsa Chica Senior Project Ad Hoc Committee Notification The City Council approve the Ad Hoc Committee’s recommendation to direct the City Manager to work with the City Attorney to send a letter to the Project Proponents notifying them of the Ad Hoc Committee’s intent to further evaluate the information presented to the City Council and the public at the October 15th, 2024, Hearing, which was relied on prior to the Council Members casting their votes. Recommended Action: ADJOURNMENT - ADJOURN IN HONOR OF PASCAL AND KELLY REID The next regularly scheduled meeting of the Huntington Beach City Council/Public Financing Authority is Tuesday, February 4, 2025, in the Civic Center Council Chambers, 2000 Main Street, Huntington Beach, California. INTERNET ACCESS TO CITY COUNCIL/PUBLIC FINANCING AUTHORITY AGENDA AND STAFF REPORT MATERIAL IS AVAILABLE PRIOR TO CITY COUNCIL MEETINGS AT http://www.huntingtonbeachca.gov Page 7 of 8 8 AGENDA January 21, 2025City Council/Public Financing Authority Page 8 of 8 9 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:25-023 MEETING DATE:1/21/2025 CONFERENCE WITH LABOR NEGOTIATORS (Gov. Code section 54957.6.) Agency designated representatives: Travis Hopkins, Acting City Manager; also in attendance: Marissa Sur, Director of Human Resources; Michael E. Gates, City Attorney and David Cain, Interim Chief Financial Officer. Employee Organization: Huntington Beach Municipal Teamsters (HBMT). City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 10 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:25-024 MEETING DATE:1/21/2025 CONFERENCE WITH LABOR NEGOTIATORS (Gov. Code section 54957.6.) Agency designated representatives: Travis Hopkins, Acting City Manager; also in attendance: Marissa Sur, Director of Human Resources; Michael E. Gates, City Attorney and David Cain, Interim Chief Financial Officer. Employee Organization: Management Employees' Organization (MEO). City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 11 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:25-026 MEETING DATE:1/21/2025 CONFERENCE WITH LABOR NEGOTIATORS (Gov. Code section 54957.6.) Agency designated representatives: Travis Hopkins, Acting City Manager; also in attendance: Marissa Sur, Director of Human Resources; Michael E. Gates, City Attorney and David Cain, Interim Chief Financial Officer. Employee Organization: Marine Safety Management Association (MSMA). City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 12 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:25-027 MEETING DATE:1/21/2025 PUBLIC EMPLOYEE APPOINTMENT (Gov. Code section 54957(b)(1).) Title: City Manager. City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 13 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:25-031 MEETING DATE:1/21/2025 CONFERENCE WITH LEGAL COUNSEL-ANTICIPATED LITIGATION (Gov. Code section 54956.9 (d)(4).): One (1). City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 14 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:25-032 MEETING DATE:1/21/2025 CONFERENCE WITH LEGAL COUNSEL-EXISTING LITIGATION. (Paragraph (1) of subdivision (d) of Section 54956.9). City of Huntington Beach, et al. v. State of California, et al. (SB54); USDC Case No.: 8:25-cv-00026. City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 15 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:25-008 MEETING DATE:1/21/2025 Subject: Infrastructure Report Card City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 16 2024 Infrastructure Report Card City Council Study Session 17 C.,,..;f NTINGTON BEACH Infrastructure Report Card. •Significant components of the City’s backbone infrastructure date back to the 60’s and 70’s, thus have been extended beyond their intended useful life. •1998 Citizens Infrastructure Advisory Committee determined that $1.37 Billion was necessary. By comparison, $697 Million was invested between 2005 and 2024. Context Fire Station, Library, and old Civic Center, Circa 1960 18 C,..,tNTINGTON BEACH Infrastructure Report Card. ✓Evaluate physical condition of 11 infrastructure categories to highlight strengths and urgent challenges to assist in a long-term improvement plan. ✓Maintain a minimum acceptable level of service for the City’s residents and visitors. Goals 19 Infrastructure Report Card Process Wastewater, Drinking Water, Stormwater Public Facilities, Public Parks Roads & Mobility, Non- Roads Pavement, Bridges Coastal Shoreline, Huntington Harbor Information Services (Hardware, Network, Security) 11 Infrastructure Categories 31 industry experts, including City Staff Technical expert tours Review of available data and reports Public financing experts Technical Experts Committee of 99 local residents and communication experts Online Survey –1,331 responses 3 In-Person Infrastructure Tours Partner Toolkit –Fact Sheets, Video, and Social Media Webpage Community Input 20 7 ,tNTINGTOH BEACH Infrastructure Report Card. 21 Structural Integrity, Roofs, HVAC, Plumbing, and Electrical Equipment Warner, Bushard, Heil, Murdy, and Lake Fire Stations Critical Needs - Facilities Fire Station 3 – Bushard - (1976)Boiler – City Hall - (2024) 22 C.,..tNTINGTON BEACH Infrastructure Report Card. 50+ Years Old Pump Stations (15)Major Flooding Critical Needs - Stormwater King Tide at Sunset Beach (2023) Hamilton Pump Station (2024) 23 C.,..tNTINGTON BEACH Infrastructure Report Card. Major Asphalt Distresses at Most Alleys (512 Alleys or 34 Linear Miles) Localized Repairs Performed Critical Needs - Alleyways Malloy Drive Alley (2024)Indianapolis Avenue Alley (2024) 24 C.,..tNTINGTON BEACH Infrastructure Report Card. Other Findings And Critical Needs ✓7 out 35 bridges Need Near-Term Repair ✓Funded via OCTA, State, and Federal grants. ✓Good Pavement Condition Index ✓Mobility and Signal Synchronization Are Needed. ✓1 Lift Station Replaced Per Year ✓3 Water Wells To Be Replaced ✓Newly Approved Rates will support improvements & new long-term projects. ✓81 Parks visited at least once a month by 92% of Residents ✓56% Condition Rating by Residents Due to Deferred Maintenance ✓Pier and Plaza in Great Condition (Over 1 Million Visitors Per Year) ✓Vulnerability of Coastal Bluffs ✓City Bulkheads (3,000 Linear Feet) Require Immediate Attention ✓Rehabilitation of Public Dock, Auxiliary, and Public Restroom ✓99% City Staff Satisfaction ✓Limited Staff ✓System Backup, Network Redundancy, and Access Control Need Improvements 25 C.,..tNTINGTON BEACH Infrastructure Report Card. ,_ Strategic Solutions For Further Consideration ✓Public-Private Partnerships (P3s) ✓Parking and Business Improvement Area Law (PBIDs) ✓Transient Occupancy Taxes (TOTs) to Short-Term Rentals ✓Community Facilities District (CFDs) ✓General Fund (GF) ✓Enhanced Infrastructure Financing Districts (EIFDs) ✓Federal and State Grants (Grants) ✓Development Impact Fee Programs (DIFs) ✓Lease Revenue Bonds (LRBs) ✓Parcel Taxes (PTs) Huntington Harbor (2024) 26 C.,..tNTINGTON BEACH Infrastructure Report Card. OCC Workshop on November 9, 2023 Infrastructure Tour on January 19, 2024 Thank You To Our Engaged Residents! 27 C.,..tNTINGTON BEACH Infrastructure Report Card. Questions 28 0-~NTINGTON BEACH Infrastructure Report Card. City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:24-917 MEETING DATE:1/21/2025 Subject: The Marisol Senior Living Project Financing City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 29 The Marisol Huntington Beach City Council Study Session January 21, 2025 30 Overview 1 The Marisol will be a 214-unit senior living project located at the NE corner of Main St and Yorktown Ave Already fully entitled and approved The building department for the City of Huntington Beach (the “City”) has approved the construction drawings, subject to the completion of the oil well re-abandonment; target is to pull a permit in late 1Q or early 2Q 2025 A nonprofit owner will develop the project (subsidiary of The Bluhm Family Foundation, a 501(c)(3) trust) Projected 130 full-time FTE’s at stabilization and 800 construction jobs To be financed with tax-exempt bonds issued by the California Public Finance Authority (CalPFA ), which requires the City’s approval The City will have no liability with respect to the bonds 31 PILOT Agreement 2 PILOT = Payment in Lieu of Taxes Under the PILOT agreement, to the extent the project is tax-exempt , the project will pay to the City what the City otherwise would have received Applies to property taxes and other taxes City currently collects $22,335 per year in property taxes (16% of the Basic Levy Rate of $139,592) Forecast is for the City to collect over $240,000 per year in property taxes upon project stabilization In addition, the project owner agrees to comply with the City’s ordinances, rules and regulations, even if the owner would have been exempt due to its nonprofit status 32 3 Aerial The Marisol 33 4 Site Plan 2134 Main Street 2100 Main Street 2130 Main Street The Marisol 34 I I I ! I I I ~~-:r•1f £.lt-f~TREET ---............. lfttaSftj~/ &~ce-.:- 20/"2.01-MICIII. I i ',, 1-_: -·-·-·-·{. ~Nl ONE AH) TWO ST0fn' RESll)[NTW. 5lRIXTlffl£S (NOt A PNn) """'"' ON[ N<> 1WO STORY ""'DCNTW. '"""'"''"' (NOT A PAR() """""''"' ANO TWO STORV Rellll£HTW. """""'""' (NOT A PNff) 5 Rendering 35 6 Renderings (Continued) 36 7 Renderings (Continued) 37 8 Renderings (Continued) 38\ City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:25-005 MEETING DATE:1/21/2025 Huntington Beach Police Chaplain Bob Ewing City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 39 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:25-022 MEETING DATE:1/21/2025 Subject: Update of Huntington Beach’s Support for LA Fire Relief Efforts City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 40 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:24-853 MEETING DATE:1/21/2025 REQUEST FOR CITY COUNCIL ACTION SUBMITTED TO:Honorable Mayor Pro Tem and City Council Members SUBMITTED BY:Pat Burns, Mayor PREPARED BY:Lisa Lane Barnes, City Clerk Subject: Annual Review of the City Code of Ethics Statement of Issue: Resolution No. 2016-73 specifies that an annual review of the City Code of Ethics (Code) should occur each year. As stated in the Code, its purpose is “to set a standard of conduct for all elected officials, officers, employees, and members of advisory boards, commissions, committees of the City of Huntington Beach.” The Mayor, City Manager, Chairpersons, and City Department Directors are responsible for accomplishing this annual review. With this memorandum, I am formally presenting the City Code of Ethics to the City Council, City Manager, Chairpersons, and City Department Directors for their review and distribution as specified by Resolution No. 2016-73. An explanation of the Code and link to Resolution No. 2016-73 can be found on the City’s website under Transparency Portal - Transparency in Huntington Beach. Financial Impact: None. Recommended Action: Direct the City Clerk to record in the official minutes that the City Code of Ethics was presented to the City Council, City Manager, Chairpersons, and City Department Directors for their review and distribution as required by Resolution No. 2016-73. Alternative Action(s): Do not approve the recommended action and direct staff accordingly. Strategic Plan Goal: Non-Applicable - Administrative Item City of Huntington Beach Printed on 1/16/2025Page 1 of 2 powered by Legistar™ 41 File #:24-853 MEETING DATE:1/21/2025 Attachment(s): 1. Resolution No. 2016-73, including Exhibit “A”, City of Huntington Beach Code of Ethics. City of Huntington Beach Printed on 1/16/2025Page 2 of 2 powered by Legistar™ 42 43 RESOLUTION NO. 2016-73 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HUNTINGTON BEACH AMENDING THE CITY'S CODE OF ETHICS WHEREAS, on October 4, 1993, the City Council adopted Resolution No. 6524, which established a Code of Ethics to serve as a standard of conduct for all elected officials, officers, employees and members of advisory boards, commissions, and committees of the City of Huntington Beach; and On August 4, 2003, the City Council adopted Resolution No. 2003-51 amending the Code of Ethics; and On January 20, 2004, the City Council adopted Resolution No. 2004-2 amending the Code of Ethics, and On February 16, 2010, the City Council approved a revised version of the Code of Ethics as recommended by the Intergovernmental Relations Committee, NOW THEREFORE, the City Council of the City of Huntington Beach does hereby resolve as follows: 1. That the City of Huntington Beach revised Code of Ethics, a copy of which is attached hereto as Exhibit "A" and incorporated by this reference as though fully set forth herein, is hereby adopted and approved. 2. The City Council, City departments, and all boards, commissions, and committees are to formally review this Code of Ethics with their members annually during the month of January. The Mayor, City Manager and Chairpersons shall be responsible for accomplishing this review. New members of the City Council, boards, commission, and committees and new J 6-5499/146272/PD 44 RESOLUTION NO; 2016-73 employees are to be provided a copy of the Code of Ethics for their review when they are elected or appointed. 3. All elected officials, officers, employees and members of advisory boards, commissions, and committees of the City of Huntington Beach shall sign Acknowledgment of Receipt forms (Exhibit A). Said acknowledgments of the elected officials and members of boards, commissions, and committees shall be maintained on file with the City Clerk. Said acknowledgments of officers and employees shall be maintained by the Human Resources Department. PASSED, APPROVED and ADOPTED by the City Council of the City of Huntington Beach at a regular meeting thereof held on the 21st day of November , 2016 Mayor INITIATED AND APPROVED: 1Z_~&s~~ City City Clerk 16-5499/146272/PD 2 {) /'--: , i ' b ~ 'vl v-'71 io fi'I ✓ 45 C·ity of Huntington Beach INTER-DEPARTMENT COMMMUNICATION HUNTINGTON BEACH TO: FROM: DATE: Honorable Mayor and City Council Robin Estanislau, City Clerkf4V January 17, 2024 SUBJECT: COUNCIL MINUTE ACTION TO REVISE EXHIBIT "A" OF RESOLUTION NO. 2016-73 -CITY CODE OF ETHICS At the City Council meeting of January 16 , 2024, the following minute action was taken to revise Exhibit "A" of Resolution No . 2026-73: A motion was made by McKeon , second Van Der Mark, to direct the City Clerk to record in the officia l minutes that the City Code of Ethics was presented to the City Council , City Manager, Chairpersons, and City Department Directors for their review and distribution as required by Resolution No . 2016-73, as amended to substitute the term "equality" for "equity" in Exhibit "A," City of Huntington. Beach Code of Ethics. By copy of this memo, Resolution No . 2016-73, including a revised City Code of Ethics (Exhibit "A ") is being shared for distribution purposes as directed. Att: Resolution No. 2016-73 with revised Exhibit "A " -City of Huntington Beach Code of Ethics c : File Executive T earn Administrative Assistants Board/Commission/Committee Staff Liaisons 46 City of Huntington Beach Code of Ethics Preamble Exhibit "A" The citizens of the City of Huntington Beach are entitled to responsible, fair and honest city government that operates in an atmosphere of respect and civility . Accordingly, the Huntington Beach City Council adopts this code to : 1. Describe the standards of behavior to which its leaders and staff aspire. 2 . Provide an ongoing source of guidance to elected leaders, city officials and staff in their day-to-day service to the city . 3 . Promote and maintain a cu lture of ethics . Pledge On November 21, 2016, the City Council of the City of Huntington Beach adopted a Code of Ethics, which applies to all City elected or appointed officials, city employees, and members of its boards, commissions , committees, and task forces and requires the following pledge: Code of Ethics Responsibility • I understand that the community expects me to serve with dignity and respect , as well as be an agent of the democratic process . • I avoid actions that might cause the public to question my independent judgment. • I do not use my office or the resources of the city for personal or political gain . • I am a prudent steward of public resources and actively consider the impact of my decisions on the financial and social stability of the city and its citizens . Fairness • I promote consistency, equality and non-discrimination in public agency decision- making. • I make decisions based on the merits of an issue, including research and facts. • I encourage diverse public engagement in our decision-making processes and support the public's right to know. Respect • I treat my fellow city officials , staff, commission members and the public w ith patience , courtesy, civility, and respect , even when we disagree on what is best for the community and its citizens . Honesty • I am honest with all elected officials, staff, commission members, boards , the public and others . • I am prepared to make decisions when necessary for the public's best interest , whether those decisions are popular or not. • I take responsibility for my actions, even when it is uncomfortable to do so. 47 City of Huntington Beach Code of Ethics Preamble Exhibit "A" The citizens of the City of Huntington Beach are entitled to responsible, fair and honest city government that operates in an atmosphere of respect and civility. Accordingly, the Huntington Beach City Council adopts this code to: 1. Describe the standards of behavior to which its leaders and staff aspire. 2. Provide an ongoing source of guidance to elected leaders, city officials and staff in their day-to-day service to the city. 3. Promote and maintain a culture of ethics. Pledge On November 21, 2016, the City Council of the City of Huntington Beach adopted a Code of Ethics, which applies to all City elected or appointed officials, city employees, and members of its boards, commissions, committees, and task forces and requires the following pledge: Code of Ethics Responsibility • I understand that the community expects me to serve with dignity and respect, as well as be an agent of the democratic process. • I avoid actions that might cause the public to question my independent judgment. • I do not use my office or the resources of the city for personal or political gain. • I am a prudent steward of public resources and actively consider the impact of my decisions on the financial and social stability of the city and its citizens. Fairness • I promote consistency, equity and non-discrimination in public agency decision-making. • I make decisions based on the merits of an issue, including research and facts. • I encourage diverse public engagement in our decision-making processes and support the public's right to know. Respect • I treat my fellow city officials, staff, commission members and the public with patience, courtesy, civility, and respect, even when we disagree on what is best for the community and its citizens. Honesty • I am honest with all elected officials, staff, commission members, boards, the public and others. • I am prepared to make decisions when necessary for the public's best interest, whether those decisions are popular or not. • I take responsibility for my actions, even when it is uncomfortable to do so. 48 ACKNOWLEDGEMENT PROCESS FOR THE CITY OF HUNTINGTON BEACH CODE OF ETHICS Exhibit "A" • All current elected and appointed city officials including current members of all city boards, commissions, committees, and task forces, and all current city employees will be given a copy of the newly adopted City Code of Ethics following its adoption on November 21, 2016 and asked to sign an acknowledgement form at that time. THEREAFTER: • All elected officials of the city will be given a copy of the City Code of Ethics and asked to sign an acknowledgement form at the time of their swearing in. • All new employees of the city will be given a copy of the City Code of Ethics and asked to sign an acknowledgement form as part of their new employee orientation. • Each new member of a city board, commission, committee, or task force will be given a copy of the City Code of Ethics and asked to sign an acknowledgement form at their first meeting. • Acknowledgment of Receipt forms for elected officials and members of boards, committees and commissions shall be maintained on file with the City Clerk. Said acknowledgments for officers and employees shall be maintained on file with the Department of Human Resources. 49 CITY OF HUNTINGTON BEACH CODE OF ETHICS Exhibit "A" ACKNOWLEDGMENT OF RECEIPT FORM Name: Title: Board/ Department: Signature: Date: (Please type or print first and last name) 50 Res. No. 2016-73 STATE OF CALIFORNIA COUNTY OF ORANGE ) ss: CITY OF HUNTINGTON BEACH ) I, ROBIN ESTANISLAU the duly appointed, qualified City Clerk of the City of Huntington Beach, and ex-officio Clerk of the City Council of said City, do hereby certify that the whole number of members of the City Council of the City of Huntington Beach is seven; that the foregoing resolution was passed and adopted by the affirmative vote of at least a majority of all the members of said City Council at a Regular meeting thereof held on November 21, 2016 by the following vote: AYES: Posey, O'Connell, Sullivan, Katapodis, Hardy, Delgleize, Peterson NOES: None ABSENT: None RECUSE: None City Cle'rk and ex-officio Clerk of the City Council of the City of Huntington Beach, California 51 City of Huntington Beach Code of Ethics Preamble Exhibit "A" The citizens of the City of Huntington Beach are entitled to responsible , fair and onest city government that operates in an atmosphere of respect and civility. According! , the Huntington Beach City Council adopts this code to : 1. Describe the standards of behavior to which its leaders and staff a .· ire. 2 . Provide an ongoing source of guidance to elected leaders, city o 1cials and staff in their day-to-day service to the city . 3 . Promote and maintain a culture of ethics. Pledge On November 21, 2016 , the City Council of the City of Huljt1ngton Beach adopted a Code of Ethics , which applies to all City elected or appointed offi {als, city employees, and members of its boards , commissions, committees, and task forces nd requires the following pledge: hies Responsibility • I understand that the community ex cts me to serve with dignity and respect , as well as be an agent of the democratic ocess . • I avoid actions that might cause e public to question my independent judgment. • I do not use my office or the r ources of the city for personal or political gain. • I am a prudent steward of p lie resources and actively consider the impact of my . decisions on the financial nd social stability of the city and its citizens. Fairness • I promote consistenc , equity and non-discrimination in public agency decision-making. • I make decisions b ed on the merits of an issue, including research and facts. • I encourage diver e public engagement in our decision-making processes and support the public's righ o know. Respect • I treat my fe ow city officials , staff, commission members and the public with patience , courtesy, 1vility, and respect, even when we disagree on what is best for the commu · y and its citizens. Honesty • I a honest with all elected officials, staff, commission members, boards , the public and o ers . • am prepared to make decisions when necessary for the public's best interest, whether those decisions are popular or not. • I take responsibility for my actions , even when it is uncomfortable to do so. City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:25-015 MEETING DATE:1/21/2025 REQUEST FOR CITY COUNCIL ACTION SUBMITTED TO:Honorable Mayor and City Council Members SUBMITTED BY:Lisa Lane Barnes, City Clerk PREPARED BY:Lisa Lane Barnes, City Clerk Subject: Approve and Adopt Minutes Statement of Issue: The City Council/Public Financing Authority regular meeting and Housing Authority, Parking Authority and Successor Agency special meeting minutes of December 17, 2024, require review and approval. Financial Impact: None. Recommended Action: Approve and adopt the City Council/Public Financing Authority regular meeting and the Housing Authority, Parking Authority and Successor Agency special meeting minutes of December 17, 2024 . Alternative Action(s): Do not approve and/or request revision(s). Analysis: None Environmental Status: Non-Applicable Strategic Plan Goal: Non Applicable - Administrative Item Attachment(s): 1. December 17, 2024 CC/PFA regular and Housing Authority, Parking Authority and Successor Agency special meeting minutes City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 52 Minutes City Council/Public Financing Authority Regular Meeting and Special Meetings of the Housing Authority, Parking Authority, and Successor Agency City of Huntington Beach Tuesday, December 17, 2024 4:30 PM — Council Chambers 6:00 PM — Council Chambers Civic Center, 2000 Main Street Huntington Beach, California 92648 A video recording of the 4:30 PM and 6:00 PM portions of this meeting is on file in the Office of the City Clerk, and archived at https://huntingtonbeach.legistar.com/Calendar.aspx 4:30 PM — COUNCIL CHAMBERS CALLED TO ORDER — 4:30 PM ROLL CALL Present: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams Absent: None CITY COUNCIL MEMBER COMMENTS (3-Minute Time Limit) Mayor Burns, Mayor Pro Tem McKeon, Councilmembers Kennedy, Strickland, Twining, Van Der Mark, and Williams acknowledged the Chargers Edison High School Football Team for winning the state championship. They each also wished everyone a wonderful Holiday Season! ANNOUNCEMENT OF SUPPLEMENTAL COMMUNICATIONS RELATED TO CLOSED SESSION ITEMS (Received After Agenda Distribution) — None PUBLIC COMMENTS (3-Minute Time Limit) — None Mayor Burns read titles for Closed Session Item #1 24-871 regarding Conference with Labor Negotiators and Employee Organization: Huntington Beach Municipal Teamsters (HBMT); Item #2 24-872 regarding Conference with Labor Negotiators and Employee Organization: Management Employees' Organization (MEO); Item #3 24-873 regarding Conference with Labor Negotiators and Employee Organization: Marine Safety Management Association (MSMA); and Item #7 24-894 regarding Public Employee Appointment: City Manager. A motion was made by Strickland, with a second by Van Der Mark, to recess to Closed Session. RECESSED TO CLOSED SESSION — 4:35 PM CLOSED SESSION 1. 24-871 CONFERENCE WITH LABOR NEGOTIATORS (Gov. Code section 54957.6.) Agency designated representatives: Travis Hopkins, Acting City Manager; also in attendance: Marissa Sur, Director of Human Resources; Michael E. Gates, City 53 City Council/PFA Regular Meeting Minutes and Special Meetings of the Housing Authority, Parking Authority, and Successor Agency December 17, 2024, Page 2 of 12 Attorney and David Cain, Interim Chief Financial Officer. Employee Organization: Huntington Beach Municipal Teamsters (HBMT). 2. 24-872 CONFERENCE WITH LABOR NEGOTIATORS (Gov. Code section 54957.6.) Agency designated representatives: Travis Hopkins, Acting City Manager; also in attendance: Marissa Sur, Director of Human Resources; Michael E. Gates, City Attorney and David Cain, Interim Chief Financial Officer. Employee Organization: Management Employees’ Organization (MEO). 3. 24-873 CONFERENCE WITH LABOR NEGOTIATORS (Gov. Code section 54957.6.) Agency designated representatives: Travis Hopkins, Acting City Manager; also in attendance: Marissa Sur, Director of Human Resources; Michael E. Gates, City Attorney and David Cain, Interim Chief Financial Officer. Employee Organization: Marine Safety Management Association (MSMA). 4. 24-874 CONFERENCE WITH LEGAL COUNSEL-EXISTING LITIGATION. (Paragraph (1) of subdivision (d) of Section 54956.9). Gallier (Michael) v. City of Huntington Beach and Jeff Otto II Gance; OCSC Case No.: 30-2023-01359146-CU-PO-CJC. 5. 24-875 CONFERENCE WITH LEGAL COUNSEL-EXISTING LITIGATION. (Paragraph (1) of subdivision (d) of Section 54956.9). Flanders (Emily) v. City of Huntington Beach; OCSC Case No: 30-2023-01328127. 6. 24-876 CONFERENCE WITH LEGAL COUNSEL-ANTICIPATED LITIGATION (Gov. Code section 54956.9(d)(4).): Two (2). 7. 24-894 PUBLIC EMPLOYEE APPOINTMENT (Gov. Code section 54957(b)(1).) Title: City Manager. 6:00 PM — COUNCIL CHAMBERS RECONVENED CITY COUNCIL/PUBLIC FINANCING AUTHORITY REGULAR MEETING AND CALLED TO ORDER SPECIAL MEETINGS OF THE HOUSING AUTHORITY, PARKING AUTHORITY AND SUCCESSOR AGENCY — 6:00 PM ROLL CALL Present: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams Absent: None PLEDGE OF ALLEGIANCE — Led by Councilmember Kennedy INVOCATION In permitting a nonsectarian invocation, the City does not intend to proselytize or advance any faith or belief. Neither the City nor the City Council endorses any particular religious belief or form of invocation. 8. 24-784 Huntington Beach Police Chaplain James Pike CLOSED SESSION REPORT BY CITY ATTORNEY — None 54 City Council/PFA Regular Meeting Minutes and Special Meetings of the Housing Authority, Parking Authority, and Successor Agency December 17, 2024, Page 3 of 12 Councilmember Strickland announced that Consent Calendar Item #15, regarding execution of a License Agreement with Flowers of the Sky Entertainment, had been withdrawn from consideration to address some outstanding issues. ANNOUNCEMENT OF SUPPLEMENTAL COMMUNICATIONS (Received After Agenda Distribution) Pursuant to the Brown “Open Meetings” Act, City Clerk Lisa Barnes announced supplemental communications received by her office following distribution of the Council Agenda packet which were all uploaded to the City’s website and Councilmember iPads: Consent Calendar Items #14 (1 email communication), #15 (99 email communications), #22 (1 email communication); Councilmember Items #24 (1 email communication), and #25 (1 email communication). PUBLIC COMMENTS (2-Minute Time Limit due to volume of speakers) — 28 Speakers The number [hh:mm:ss] following the speakers' comments indicates their approximate starting time in the archived video located at http://www.surfcity-hb.org/government/agendas. Barbara Richardson, 51-year resident, was called to speak and stated her opposition to Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location. (00:11:56) Diane Bentley, 23-year Huntington Beach resident, was called to speak and stated her opposition to Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location. (00:13:38) Andrew Einhorn, Huntington Beach resident, was called to speak and stated the newly elected Councilmembers have a mandate to fix Huntington Beach by ensuring financial stability, repair of crumbling roads and protecting Huntington Beach libraries. Mr. Einhorn also stated his opposition to Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location. (00:14:52) Ken Inouye, a 50-year Huntington Beach resident, was called to speak and repeated his request that the City Councilmembers prepare and present a financial plan for the City because he believes that Huntington Beach is facing a severe financial crisis. He described examples to document his specific concerns, and asked Mayor Burns to take proactive actions now to address these financial issues. (00:16:54) David Rynerson, 27-year resident, was called to speak and stated his concern regarding the lack of proper and appropriate Councilmember transparency for Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location. He also stated concerns related to the recently filed Petition to Review the Citizens Book Review Ordinance, and noted repeated requests for status confirmation from the City Clerk have gone unanswered. (00:18:56) Steve Parsons, Huntington Harbour Yacht Club Commodore, was called to speak and stated his support for Consent Calendar Item #22 regarding adopting Resolution No. 2024-09 authorizing an application for grant funds from the California Parks and Recreation Division of Boating and Waterway Boat Launch Facilities. He also congratulated the newly elected Councilmembers and City Clerk. (00:20:13) Amory Hanson was called to speak and stated support for Councilmember Item #24 regarding high density residential development health and safety criteria. (00:22:00) 55 City Council/PFA Regular Meeting Minutes and Special Meetings of the Housing Authority, Parking Authority, and Successor Agency December 17, 2024, Page 4 of 12 Pat Goodman was called to speak and asked questions related to Councilmember Item #24 regarding high density residential development health and safety criteria, and Item #25 regarding the review process and information for the Bolsa Chica Senior Care Community Project. (00:22:51) Charles Jackson, 23-year Huntington Beach resident, was called to speak and asked Mayor Burns to ensure the children's book, Everyone Poops by Taro Gomi, be returned to the Children's Section of the Public Library. He also stated support for Consent Calendar Item #14 to approve and authorize the execution of a site license agreement with Verizon for an existing cell site at Talbert Park. (00:24:58) Phil Burtis, as a representative of 42 homes in the Olive Park tract, across the street from the Slater Avenue parking lot that leads into Central Park, was called to speak and stated concerns regarding neighborhood parking during special events held throughout the year in Central Park that negatively impact their neighborhood parking spaces. He suggested implementing a resident parking permit system to be used during any big special events in Central Park. (00:26:12) Susane Arnold was called to speak and stated her opposition to Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location. (00:27:47) Adam Wood, representing the Building Industry Association and Building and Shield Legal Defense Foundation, was called to speak and stated opposition to Councilmember Item #24 regarding high density residential development health and safety criteria and some of the claims made by Mayor Burns, Mayor Pro Tem McKeon and Councilmember Van Der Mark. (00:29:39) Brian Thienes was called to speak and congratulated the recently elected Councilmembers. He stated his support for Councilmember Items #25 regarding a review process and information for the Bolsa Chica Senior Care Community Project. (00:32:04) Jonathan Bonwit, 15-year Huntington Beach resident, was called to speak and congratulated the newly elected Councilmembers. He stated his support for Councilmember Items #25 regarding a review process and information for the Bolsa Chica Senior Care Community Project. (00:34:19) Larry Slonim, 40+-year Huntington Beach resident, was called to speak and stated his opposition to Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location. (00:36:28) Tom Dillman, Cabo Del Mar Homeowners Association (HOA) Board Member, also representing the HOAs of Brightwater and Parkside Estates and apartment complexes of Cambridge and Monticello near the Bolsa Chica Project, was called to speak and shared concerns related to plans for the Bolsa Chica Senior Care Community Project. He stated support for Councilmember Items #24 regarding high density residential development health and safety criteria, and he stated support for Councilmember Items #25 regarding a review process and information for the Bolsa Chica Senior Care Community Project to prevent out-of-control development. (00:38:22) Michael Rogers, Huntington Beach resident, was called to speak and stated opposition to Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location. (00:40:33) Michele Rogers was called to speak and stated her opposition to Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location. (00:42:46) 56 City Council/PFA Regular Meeting Minutes and Special Meetings of the Housing Authority, Parking Authority, and Successor Agency December 17, 2024, Page 5 of 12 Christopher Rini, Huntington Beach native, was called to speak and stated opposition to Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location due to lack of transparency and proper community input during the evaluation process. (00:43:17) Ann Palmer was called to speak and stated her opposition to Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location because a number of issues have not been thoroughly considered. (00:45:20) Russell Neal, Huntington Beach resident, was called to speak and congratulated the newly elected Councilmembers and City Clerk and encouraged them in their fight for the citizens of Huntington Beach. (00:47:28) Justine Makoff, representing the Free Reign Foundation at Huntington Beach Equestrian Center, was called to speak and provided an update on the success of the recent Celebrate the Day of the Horse event. She expressed appreciation for the community's support and looks forward to many more successful events. (00:49:20) Guest P was called to speak and shared her opinions regarding what she called the inappropriateness of the gift that Former Mayor Van Der Mark recently presented to various colleagues. Mayor Burns asked that she complete a blue card so a one-on-one meeting could be arranged to address her concerns. (00:50:51) Roger Noor was called to speak and shared his opinions on what he called inappropriate behavior by City Attorney Michael Gates at the most recent City Council meeting when he proceeded to discuss past actions of Former Councilmembers Bolton, Kalmick and Moser after they left the dais. Mr. Noor also shared his perspective of his personal exchanges with City Attorney Michael Gates regarding the towing of his automobile. (00:52:48) Perry Clitheroe was called to speak and expressed appreciation for seeing an accurate description by Mayor Burns of the City's poor transit quality as expressed in Councilmember Items #24 regarding high density residential development health and safety criteria. (00:55:38) Tim Geddes was called to speak and shared his Christmas sentiments. Mr. Geddes stated his opposition to Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location due to lack of transparency and proper community input during the evaluation process. (00:57:49) Victor Leipzig, long-time Huntington Beach resident, Former Mayor and Councilmember, and Orange County Audubon Society Member, was called to speak and stated opposition to Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location because of concerns for the impact on Central Park wildlife. (00:59:43) Amanda Herring, resident of Huntington Beach, Irby Park and Shipley Nature Center volunteer, was called to speak and stated her opposition to Withdrawn Consent Calendar Item #15 regarding execution of a License Agreement with Flowers of the Sky Entertainment for the proposed Public Library location because of the negative impact this event would have on native wildlife, lack of transparency and proper community input during the evaluation process. (01:00:48) COUNCIL COMMITTEE APPOINTMENT ANNOUNCEMENTS 57 City Council/PFA Regular Meeting Minutes and Special Meetings of the Housing Authority, Parking Authority, and Successor Agency December 17, 2024, Page 6 of 12 Councilmember Van Der Mark appointed Domnic McGee to the Planning Commission and Jignesh Padhiar to the Citizen Participation Advisory Board; Mayor Burns appointed Brian Thienes to the Planning Commission; Councilmember Williams appointed Brett Bush to the Planning Commission, Jeanne Paris to the Community and Library Services Commission, and Scott Dowds to the Finance Commission; Councilmember Twining appointed Ken Babineau to the Planning Commission, Paul Geary to the Finance Commission, Dennis Pappas to the Citizen Participation Advisory Board, and Steve Barnes to the Community and Library Services Commission; and Councilmember Kennedy appointed Ben Goldberg to the Planning Commission, Stephen Quinn to the Citizen Participation Advisory Board, and David Clifford to the CIAB/Public Works Commission. AB 1234 REPORTING — None OPENNESS IN NEGOTIATION DISCLOSURES — None CITY MANAGER’S REPORT Acting City Manager Travis Hopkins congratulated Huntington Beach City Fire Chief Scott Haberle for his service as he announced Chief Haberle's retirement at the end of the year. Chief Haberle has served public safety for 36 years in Southern California during his career. Acting City Manager Hopkins noted Chief Haberle developed a culture of leadership, provided exemplary customer service for the community, ensured operational efficiencies and succession planning during his nearly five years with Huntington Beach. Mayor Burns presented Fire Chief Haberle with a plaque of recognition for his service. Mayor Pro Tem McKeon and Councilmembers Strickland, Kennedy, Twining, Williams and Van Der Mark and City Attorney Michael Gates congratulated and thanked Chief Haberle as they expressed appreciation for his service. Chief Haberle expressed gratitude for the opportunity to serve Huntington Beach and noted the community's strong commitment to public safety. Chief Haberle expressed appreciation for the dedication of fellow Department Heads as well as Fire and Police Department staff. CONSENT CALENDAR (Items #9 – #22) City Clerk 9. 24-786 Approved and Adopted Minutes A motion was made by Strickland, second Van Der Mark to approve and adopt the City Council/Public Financing Authority regular meeting minutes of November 19, 2024; and, approve and adopt the City Council/Public Financing Authority regular meeting minutes of December 3, 2024. The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None 10. 24-788 Approved Monthly Update of Activities for Citizen Boards, Commissions, Committees (BCCs) and Regional Agencies — November 2024 A motion was made by Strickland, second Van Der Mark to Receive and File. 58 City Council/PFA Regular Meeting Minutes and Special Meetings of the Housing Authority, Parking Authority, and Successor Agency December 17, 2024, Page 7 of 12 The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None 11. 24-836 Approved Mayor Burns’ 2025 City Council Liaison List — Citizen Boards, Commissions, Committees A motion was made by Strickland, second Van Der Mark to, as recommended by the City Council, Public Financing Authority, Housing Authority, Parking Authority, and Successor Agency: Approve the 2025 Council Liaison List that includes appointments to citizen boards, commissions, committees, and task forces as presented by Mayor Burns. (The City Clerk certifies that FPPC Form 806 "Agency Report of Public Official Appointments" which is used to report additional compensation that officials receive when appointing themselves to positions on committees, boards or commissions of a public agency, special district and joint powers agency or authority was posted to the City's website according to law prior to this vote.) The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None 12. 24-842 Received and filed the Maddy Act Local Appointments List — 2025 (terms on City boards, commissions, and committees that expire in 2025) informing the public of openings and vacancies based on 2025 expiration of current members’ terms A motion was made by Strickland, second Van Der Mark to receive and file the Maddy Act Local Appointments List — 2025 showing vacancies that will occur on City boards, commissions, and committees in the year 2025, and direct the City Clerk to post the list at official posting locations: Civic Center, Huntington Central Library, and Main Street Library. Copies of the Maddy Act Local Appointments List — 2025 will also be posted at all branch libraries and on the City's website. The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None City Manager 13. 24-870 Approved and authorized the execution of a Software License Agreement with Accela, Inc. for software service migration from On-Premise to Software as a Service (SaaS), supporting the City’s Land Management services. A motion was made by Strickland, second Van Der Mark to approve and authorize the Mayor and City Clerk to execute the Software License Agreement with Accela, Inc. for software service migration from On-Premise to Software as a Service (SaaS), supporting the City's Land Management services. The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None 59 City Council/PFA Regular Meeting Minutes and Special Meetings of the Housing Authority, Parking Authority, and Successor Agency December 17, 2024, Page 8 of 12 Community Development 14. 24-829 Approved and authorized the execution of a Site License Agreement with Verizon for an Existing Cell Site at Talbert Park. motion was made by Strickland, second Van Der Mark to approve and authorize the Mayor and City Clerk to execute the "Site License Agreement for Installation and Use of a Communications Antenna Facility and Supporting Equipment between the City of Huntington Beach and Los Angeles SMSA Limited Partnership, DBA Verizon." The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None Community and Library Services 15. 24-643 ITEM WITHDRAWN Approve and authorize the execution of a License Agreement between the City of Huntington Beach and Flowers of the Sky Entertainment, LLC, for the management and operation of the Symphony of Flowers at Huntington Central Park East located at 18381 Goldenwest Street. Human Resources 16. 24-865 Adopted Resolution No. 2024-62 modifying the pay schedule for part-time, non- permanent, and non-classified employees to comply with the State minimum wage increase effective January 1, 2025 A motion was made by Strickland, second Van Der Mark to adopt Resolution No. 2024-62, "A Resolution of the City Council of the City of Huntington Beach Approving the Pay Schedule for Part-Time, Non- Permanent and Non-Classified Employees Effective January 1, 2025," and authorize the City Manager or designee to take all administrative and budgetary actions necessary to implement the revised pay schedule. The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None 17. 24-840 Adopted Resolution No. 2024-60 setting compensation for the newly elected City Clerk A motion was made by Strickland, second Van Der Mark to adopt Resolution No. 2024-60, "A Resolution of the City Council of the City of Huntington Beach Setting the Salary Rate and Assigning Certain Benefits for the Elected City Clerk," (range of Starting, Control or High Point) identified in Exhibit "1B" - Exhibit A of the Non-Associated Executive Management Salary Schedule, effective December 7, 2024. The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None 60 City Council/PFA Regular Meeting Minutes and Special Meetings of the Housing Authority, Parking Authority, and Successor Agency December 17, 2024, Page 9 of 12 Public Works 18. 24-790 Approved and accepted the Highway Bridge Program (HBP) grant funding from California Department of Transportation (Caltrans) for the Admiralty Drive Bridge Rehabilitation Project, CC-1450; and approved appropriation of funds. A motion was made by Strickland, second Van Der Mark to approve and accept the Highway Bridge Program grant funding for $1,916,490; and approve appropriation of funds into the Highway Bridge Replacement & Rehab (HBRR) (Account No. 96185001.82800). The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None 19. 24-833 Approved and accepted the Orange County Transportation Authority (OCTA) grants for Complete Streets Project; and approved appropriation of funds A motion was made by Strickland, second Van Der Mark to approve and accept the Orange County Transportation Authority (OCTA) grants for $8,971,000; and approve appropriation of grant award funding into the OCTA Complete Streets Projects business units: $203,000 for Banning Roundabout into 129985001 and $176,000 for Hamilton Avenue into 129985002; and authorize the Public Works Director to execute necessary documents and agreements. The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None 20. 24-856 Approved and authorized execution of Amendment No. 2 to Cooperative Agreement No. C-3-2654 between the Orange County Transportation Authority and the City of Huntington Beach for the I-405 Improvement Project A motion was made by Strickland, second Van Der Mark to approve and authorize the City Manager to execute "Amendment No. 2 to Agreement No. C-3-2654 Between Orange County Transportation Authority and City of Huntington Beach for the I-405 Improvement Project." The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None 21. 24-857 Accepted the lowest responsive and responsible bid and authorized execution of a construction contract with SAVI Construction Inc. in the amount of $197,400 for the Residential Zone 2 Curb Ramp Project, CC-1811. A motion was made by Strickland, second Van Der Mark to accept the lowest responsive and responsible bid submitted by SAVI Construction Inc. in the amount of $197,400; and authorize the Mayor and City Clerk to execute a construction contract in a form approved by the City Attorney. The motion carried by the following roll call vote: 61 City Council/PFA Regular Meeting Minutes and Special Meetings of the Housing Authority, Parking Authority, and Successor Agency December 17, 2024, Page 10 of 12 AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None 22. 24-859 Adopted Resolution No. 2024-09 authorizing an application for grant funds from the California Parks and Recreation Division of Boating and Waterway Boat Launch Facilities. A motion was made by Strickland, second Van Der Mark to adopt Resolution No. 2024-09, "A Resolution of the City Council of the City of Huntington Beach Approving the Application for Grant Funds from the California Parks and Recreation Division of Boating and Waterway Boat Launching Facilities". The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None ADMINISTRATIVE ITEMS 23. 24-866 Adopted Resolution No. 2024-61 accepting and approving the Development Impact Fee (DIF) Report for Fiscal Year 2023-24 and to make findings as required by Government Code Sections 66006 and 66001 Acting City Manager Travis Hopkins introduced David Cain, Interim Chief Financial Officer (CFO), who shared a PowerPoint communication titled FY 2023/24 Development Impact Fee Report with slides entitled Development Impact Fees, Statement of Revenues, Expenditures and Changes in Fund Balance For the Fiscal Year Ended June 30, 2024* Development Impact Fee, FY 2023/24 DIF Expenditures, and Recommended Action. A motion was made by Burns, second Van Der Mark to adopt Resolution No. 2024-61, "A Resolution of the City Council of the City of Huntington Beach to Accept and Approve the Development Impact Fee Report for Fiscal Year Ending June 30, 2024, and to make the findings as required by Government Code Sections 66006(b) and 66001(d)." The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None COUNCIL MEMBER ITEMS 24. 24-893 Approved Item Submitted by Mayor Pro Tem McKeon, Mayor Burns, and Council Member Van Der Mark — High Density Residential Development — Health & Safety Criteria Mayor Pro Tem McKeon introduced this item by stating that housing development projects often forgo necessary amenities that contribute to public health and safety in the design and construction of residential buildings and site planning in order to maximize profits at the expense of public health and safety. Significant adverse health and safety impacts occur as a direct result of development projects that perpetuate overcrowding and do not provide open space areas, access to public parkland, or access to public transit and reliable transportation options. 62 City Council/PFA Regular Meeting Minutes and Special Meetings of the Housing Authority, Parking Authority, and Successor Agency December 17, 2024, Page 11 of 12 Residential development projects often construct buildings upwards and outwards on a project site to maximize the quantity of building floor area while minimizing areas of private and common open space and recreational amenities, vegetation and trees, and public parks to accommodate the most profitable project. Inadequate access to open space and recreational parks, coupled with reduced areas of vegetation and trees results in significant adverse impacts to public health, including mental health impacts, poor air quality, and chronic disease. Reliable, accessible, safe, and healthy public transportation options do not exist in Huntington Beach and residents are forced to rely on commuting by car. Drivers are contributing to increased GHG emissions while simultaneously absorbing the associated negative health and safety impacts. A lack of access to frequent, reliable public transportation results in increased traffic vehicle crashes, increased air pollution and associated respiratory illnesses, and decreased physical activity levels. When housing development projects provide neither a sufficient quantity of onsite automobile parking spaces, ADA compliant parking spaces, or electric vehicle charging stations for residents nor access to high quality public transportation, the residents suffer adverse health and safety impacts. The recommended action is to ensure that high density residential development does not cause significant and adverse impacts to public health and safety, and staff is directed to develop criteria to ensure these issues are addressed in future high density residential developments. Councilmember Strickland stated his opposition to high-density development in Huntington Beach and commended his colleagues for bringing this item forward. He added he believes in preserving the suburban coastal Huntington Beach community and noted that is not a lifestyle choice everyone supports. Mayor Pro Tem McKeon replied this effort is not against high-density development but rather an effort to ensure a continued focus on health, safety and quality of life issues for residents going forward. A motion was made by McKeon, second Burns to ensure that high density residential development does not cause significant and adverse impacts to public health and safety, and staff is directed to develop criteria to ensure these issues are addressed in future high density residential developments. The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None 25. 24-895 Approved Item Submitted by Mayor Burns — Review Process and Information for the Bolsa Chica Senior Care Community Project Mayor Burns introduced this item by sharing his concerns regarding the nature and extent of the information presented at the recent project hearing for the Bolsa Chica Senior Care Community project, which was brought before the City Council on October 15, 2024. He recommended that an Ad-Hoc Committee comprised of City Council members, City Staff, and the City Attorney’s Office, be formed to review the process and information related to this project, to review the process and information regarding the Bolsa Chica Senior Care Community Project. The Ad-Hoc Committee will receive support from Community Development and the City Attorney's Office staff during this review. Mayor Burns added the ultimate purpose is to determine if there is enough evidence and information to revoke or amend the Bolsa Chica Senior Care Community Project Specific Plan approved on October 15, 2024. 63 City Council/PFA Regular Meeting Minutes and Special Meetings of the Housing Authority, Parking Authority, and Successor Agency December 17, 2024, Page 12 of 12 A motion was made by Burns, second McKeon to form a City Council Ad-hoc Committee, consisting of three City Council Members, to review the process and information regarding the Bolsa Chica Senior Care Community Project. The Ad-Hoc Committee will receive support from Community Development and the City Attorney's Office staff during this review. The motion carried by the following roll call vote: AYES: Twining, Kennedy, McKeon, Burns, Van Der Mark, Strickland, and Williams NOES: None The Huntington Beach City Council/Public Financing Authority regular meeting of January 7, 2025, has been cancelled due to a lack of quorum. ADJOURNMENT — at 7:27 PM a motion was made by Strickland, with a second by Van Der Mark, to adjourn to the next regularly scheduled meeting of the Huntington Beach City Council/Public Financing Authority on Tuesday, January 21, 2025, in the Civic Center Council Chambers, 2000 Main Street, Huntington Beach, California. INTERNET ACCESS TO CITY COUNCIL/PUBLIC FINANCING AUTHORITY AGENDA AND STAFF REPORT MATERIAL IS AVAILABLE PRIOR TO CITY COUNCIL MEETINGS AT http://www.huntingtonbeachca.gov _______________________________________ City Clerk and ex-officio Clerk of the City Council of the City of Huntington Beach and Secretary of the Public Financing Authority of the City of Huntington Beach, California ATTEST: ______________________________________ City Clerk-Secretary ______________________________________ Mayor-Chair 64 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:24-941 MEETING DATE:1/21/2025 REQUEST FOR CITY COUNCIL ACTION SUBMITTED TO:Honorable Mayor and City Council Members SUBMITTED BY:Travis Hopkins, Acting City Manager VIA:Eric McCoy, Fire Chief PREPARED BY:Steve Eros, Deputy Fire Marshal Patrick Bannon, Capital Projects Administrator Subject: Approve and authorize execution of Amendment No. 2 with Excalibur Well Services, Corp; approve additional funding and appropriation of funds for the Civic Center Oil Well Abandonment Project. Statement of Issue: The Huntington Beach Fire Department (HBFD) and the Public Works Department have been working on the abandonment of oil wells at the City Center and is requesting an additional $498,500 to complete the Project. During the abandonment of Civic Center #2, the abandonment contractor, Excalibur Well Services, Corp. (Excalibur) discovered that the down-hole conditions did not match Cal-GEM’s as-built records for the well. Updating the well’s history led to multiple delays in the project and the need to increase Excalibur’s scope to ensure the oil well was abandoned properly. The same conditions exist in Civic Center #1, but the strategies applied during the abandonment of Civic Center #2 have been applied to shorten the timeline for abandonment. The HBFD is requesting $498,500 to complete this portion of the abandonment project. Financial Impact: Staff is requesting an appropriation of $498,500 in HB Recovery Fund to Business Unit 31465001.82800 to cover the remaining cost of the project. Recommended Action: A) Approve and authorize the Mayor and City Clerk to execute “Amendment No. 2 to Service Agreement between the City of Huntington Beach and Excalibur Well Services, Corp. for Civic Center Well Abandonment;” and B) Approve an appropriation and transfer of $498,500 in HB Recovery Funds to Oil Well Abandonment business unit 31465001.82800. Alternative Action(s): City of Huntington Beach Printed on 1/16/2025Page 1 of 2 powered by Legistar™ 65 File #:24-941 MEETING DATE:1/21/2025 Do not approve, and direct staff accordingly. Analysis: In February 2024, the City Council approved a contract with Excalibur Well Services, Corp. (Excalibur) for the abandonment of Civic Center Wells #1, #2, and #3. In October 2024, the City Council approved additional funding for Excalibur to address unforeseen down-hole conditions that extended the scope and timeline for the abandonment of Civic Center Well #2. These conditions were required to be managed in accordance with Cal-GEM regulations, which contributed to the delay in the project timeline. The original contract was based on a time-and-materials agreement, and as a result, the extended timeline has led to an increase in project costs. Down-hole operations for Civic Center Well #2 were successfully completed in December 2024, with work on Civic Center Well #1 commencing immediately afterward. Currently, Civic Center Well #1 is 20 days into the abandonment process, with an anticipated completion date of the end of January. The methodologies employed during the abandonment of Civic Center Well #2 will also be applied to remaining wells #1 and #3. The change in scope and timeline has led to the request for additional funds of $498,500 to complete the abandonments of Civic Center #1 and #3. Approval of this additional funding and amendment of the existing Excalibur Well Services, Corp. Agreement will allow for the Civic Center Oil Well Abandonment Project to proceed. This amount does not include the Miley Keck Tank Farm scope. Environmental Status: The requested action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Furthermore, since the proposed well abandonment and lease restoration activities are considered ministerial, the project is statutorily exempt from CEQA in accordance with Section 15268 of the CEQA Guidelines. The contractor will obtain permits from the California Geologic Energy Management Division (Cal- GEM) consistent with applicable requirements. Strategic Plan Goal: Non Applicable - Administrative Item Attachment(s): 1. Amendment No. 2 to Service Agreement Between the City of Huntington Beach and Excalibur Well Services, Corp. for Civic Center Abandonment 2. Agreement and Amendment No. 1 City of Huntington Beach Printed on 1/16/2025Page 2 of 2 powered by Legistar™ 66 67 AMENDMENT NO. 2 TO SERVICE AGREEMENT BETWEEN THE CITY OF HUNTINGTON BEACH AND EXCALIBUR WELL SERVICES, CORP. FOR CIVIC CENTER WELL ABANDONMENT THIS AMENDMENT is made and entered into by and between the CITY OF HUNTINGTON BEACH, a California municipal corporation, hereinafter referred to as "City," and EXCALIBUR WELL SERVICES, CORPORATION, hereinafter referred to as "Contractor." WHEREAS, City and Contractor are parties to that certain agreement, dated February 20, 2024, entitled "Service Agreement Between the City of Huntington Beach and Excalibur Well Services, Corp., for Civic Center Well Abandonment" which agreement shall hereinafter be referred to as the "Original Agreement"; and City and Contractor wish to amend the Original Agreement to increase the amount of compensation to be paid to Contractor, NOW, THEREFORE, it is agreed by City and Contractor as follows: 1. ADDITIONAL COMPENSATION In consideration of the services to be performed under the Original Agreement, City agrees to pay Contractor at the rates specified in Exhibit B which is attached hereto and incorporated by reference into this Agreement. City further agrees to pay Contractor an additional sum not to exceed Four Hundred Ninety-Eight Thousand Five Hundred Dollars ($498,500.00). The additional sum shall be added to the original sum of Two Million Two Hundred Forty-Seven Thousand Seven Hundred Seventy Dollars ($2,249,770.00), for a new contract amount not to exceed Two Million Seven Hundred Forty-Eight Thousand Two Hundred Seventy Dollars ($2,748,270.00). 25-15836/366477 68 3 . REAFFIRMATION Except as specifically modified herein, all other terms and conditions for the Original Agreement shall remain in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by and through their authorized officers on , 2025 . --------- EXCALIBUR WELL SERVICES, CORP By : _____________ _ print name CITY OF HUNTINGTON BEACH, a municipal corporation of the State of California ITS: (circl e on e) Cha irman/President/Vice President Mayor AND By: __________ _ print name ITS: (circl e on e) Secretary /Chief Financial Officer/ Asst. Secreta1y -Treasurer 25-15836/366477 City Clerk INITIATED AND APPROVED: 6,~--~- Fire Chief RM: REVIEWED AND APPROVED : City Manager 2 69 3. REAFFIRMATION Except as specifically modified herein, all other terms and conditions for the Original Agreement shall remain in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by and through their authorized officers on , 2025. -------- EXCALIBUR WELL SERVICES, CORP print name ITS: (circle one) Chairman __ ...-- 25-15836/366477 CITY OF HUNTINGTON BEACH, a municipal corporation of the State of California Mayor City Clerk INITIATED AND APPROVED: Fire Chief APPROVED AS TO FORM: City Attomey REVIEWED AND APPROVED: City Manager 2 70 CERTIFICATE OF LtABILITY INSURANCE D/\Ti.(Ml,I/DOIVYV¥) 8/H/2024 THIS CERTIFICATE IS ISSUED ASA MATTER OFilNFORMAJ'ION ONLYANDCONFERSNO RIGHTS UPON THECERl'IFICATEHQLDEit THIS CERT!.FIGATE DOES NOT AFFIRMATIVELY: OR NEGATIVELY' AMEND1 .EXT!=fltD QR Al.TERTflE (j()IIERA~li A~FORPEP 8~ TtiE POLICH;$. BELOWi THISi CERTIFICATE, OF INSU~I\ICE QO~S f1il;)T COl'J,S'l'.ITUTE A CONTRAC'I; BETWEEII!, THE ISSUINQ INSURE~{~), AUTHORIZED REPRESENTATIVE OR PRODUCER, ANO.THECERTlflCATEifOLDER, N/\lCft# 38318 1150 38318 COVER:A.GES CERTIFICATE NUMBER: 88448574' REVISION NUMBER{ 10001379533241 A · _ UMBIU!i.t.Al.tile 1~ QCCU_R / / { / . &XC&SS LWI O --1 CLAIMS.MADE ,1000095605241 uxr1~s1~s2--0:1 p:001,,oq1007432,~2 ✓ al!!> I ✓lRereNJ1oi-isNIL WORi<ens·coMPlifilSATIDN• ANi> f!MPLOVl!Rll'. tlABlLllY y / N AN'lPRCiPRl!iTOAiP/\RTNEMiXECUtiVI! □.-. NI-.. •OFl'ICERIMl:til8&REXClUDED? --. " (t;landiilorylii.NH) Krs&~rfr:1~ ~1~.,e~Ai'toNs tiiikiw. -C Equlpmentli.eased,From Others ;/ 1000005402 JHBEB2300018507Q GENEIW.AGGREGAiE $2;000;0QI) 11a112024 11.ac112025 !iri"!\!1':i~,f•NoLiiuM,r Haooooo 1• .,,e""9,;,011:""v'"1""NJ""uR_v..,.·~,-•-11""a,.,.,.son"""··'1,-· t-$.;..:.c=i=::...._ __ , 1/31/2024 1131/2025 1/31/2Q24 1/31/2025 · 11:Jt/2024 1/31/2025 113t/2024 1/3112025 8QD!LY l!4JIJRY'{!'01t,o:ldanl} -~ . .~OCCURRE"IC\1. s25000'.O00 .AGGRl!GATE $25000000, oeselitPTION OP CiPERAllONS / i;QCAllONS /111:HICllEi; (li,CORD·101, Addition•! R9m~•~• ll<il)lidlilo, i'nily,ti,11IIRl>tll lf mor, ipacltlfi:oqyJro~) ¢.-ettlflcat~.ho. Jd·e-r.ls.: 111.ei·u· d~--J•s-ad-dlll<>o-al 1011-ured v:,,l-lltw···a-·ivet.of-su···bro· · -ga. 1,-·on·a-S:J>-ei'-all.-achedform .. s-CG. 201. :O, CG2-037l CG-.~. 0.0.1; ~IC~'-1. 06·3·,-•-cG.· 2 04, : .. an .. d-SI. C/'1102-o •. ·.I). u-tonlY.lf -reg. o. lte· -d .. by. w~lll. en<:an)lactwlJh th·Ei·•· .. named lns· 11· r1d-11. rl. <>.r-(Q. ,an.•.: ---rrern:-e:a. nd. suliJecttoall:J)olf!lY-.ti.irms. and con,dillo !!• Um.brella. ls l3lle~ss <1ver Iha Commercial Allio, General llablllty, and EmplQyers li.lelilllly co , ·-. APPROVED AS TQ FORM . Wawer i>f SUbrog1,1tlon:also app.lles tQ: tile W1>rl<el'$" c:qmplln'1alion pollc:y. perthe,aUa«:lted'(grrn . CJ40306, . -·· r·· --· CERTIFICATE liOLDER .. City .. o(H-un. ijn·g-.ton Beac;h Attn. Fire, Chief: 2000 Main st.reet . . . . . . . . Huritinglon Beach CA 92648 i ACORD 25 (2016/03) Rtt• MtcHAEL it aArss v CANCELLATION .... ,.,_ ................. ·.,.,-,,...!"'! !"'"\' .... ~,.-,•. $HOUI.O ANY, QFTHEABOV&IJESCRIBEltPOUClES BE C-ANCEl.1.ED•BeFORE THE.·. !<XPIR,\llQN DATE lttSRl;OF; .NOTICE. WILi. . BE OELlVf:REli /114 ACCQllDANC:E WITH TH.Ii 1"01,.ICY f>RQYJSIQN~ •. ~'1-988-201~ ACORD•CORPORATION. All rights reser:ved. The ACORD name and lo~o arai'eglstered marks of ACORD 246 71 POI.JCY NUMBER: 1880090151241 COMMERCIAL$ENER'AL l.l:ABILITY CG20100413 THIS: ENDORSEMENT CHANGES THE,POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED -OWNERS; LESSEES OR CONTRACTORS -SCHE.DlJLED PE.RSON OR. ORGANIZATION Thi$ endorsement modifies rnsurarice provided 1,1nder the,fQll<>Wlng: COMMERCIAL GENERALLIA131l.lTY COVERAGE PART SCHEDULE Name OfA<Jd(tlonal ln$4red Persoo(s), Or Orgai'!izationlsl · City flt .Httntil'lg:tQ~ ~~achtits officetts1 el~eted:; '· ar apr;,aintt!!d t!>fficial~, e~t:e,~es. aget:'lts ano . .wtunfeers:. . . Attn: Fire Chief 2000 Main Street Huntington Beach, CA 92648 Locationlsl Of Covered' <>ileratlons As Required By Written. Contracl,.Fully Executed Prior To The Named lnsured's Work Information required to complete this ScheclUle if notshown above, will be shown lnthe Oec::tarat1011s; A. Section II -Who Is An Insured · is ·amended' fo Include as a11.t=.1ddlUonal insured the person(s) or organlzatlon(s) shown. In the SqhedtJle, . but ()nly wlt!'l respect to liabUlly for ''bddlly inj"'ry'\ ''property damage'' or "personal . an(! advertising Injury!' caused, In whole. or In paf'ti by: 1. Your acts or omissions; or 2, The, acts or omfsslcms of those acting on your behalf;. In the perlorrnanee of your ongoing operations for the adqltlonal lnsured(s) ~t the locallon(s) designated above. However-: 1. The insurance afforded to such additional Insured only· applies to the extent permitted by law;and 2. If coverage ptovldeq t<> the 1:1dditional i11sµred)~ required · by a contract or agreement, the in~l:irance affordecf to such aclditlonai .lnsurec.l w(II. not be broader than that which you: are required by the contract or agreement to Ptovlde for such a<lditional Insured; s .. With .respect to the· Insurance •afforded to these adc;llUqnal l,osuredsi the following additional exclusloos E!ppiy~ · This 'insurance doe$ not apply to. ''bodlfy lnjuryHor "properly damag¢" oc:c:urring :affer: 1. Ali work, including matertais, parts or equipment fuml$bed in con,wctfon wlth a1.1c:fl work, on the project (other than .service, maiht1:1m;3nce or repairs} to be performed l;>y or on ~~half qf the ai;li;lltional in$ui'Eld(s) at the location, of the covered operations has been c:ompJeted~ .or 2, That portion of i•your work; out of which the JnJuiY or damage arises has been pu.t to· its intended use by any . pe~on or organl:zaUon otber than .another contractor or subcontractor t;1ngaged .lh pe;:fqrrnihg operatic>ns for a principal as,apartofthe same,proJect~. CG 2010 041~ @ lnsuranc.e $ervipEla Office, Inc., 2012 Page 1 of 2 247 72 C. With respect to the insurance afforded to these additional insureds, the following Is added to Section Ill -Limits Of Insurance; If coverage provided to the additional insured Is required by a contract or agreement, the most we will pay on behalf of the additional Insured Is the amount of insurance: 1. Required by the contract or agreement; or 2. Available under the applicable Limits of Insurance shown In the Declarations; whichever Is less. This endorsement shall not increase the applicable Limits of Insurance shown in the Declarations. Page 2 of 2 © Insurance Services Office, Inc., 2012 CG 2010 0413 8044857• I 00000056 I BXCALIBU& M-25 <lL/AL/XS/~\Jip I Sally Huynh I 6/11/2024 1,57;27 p,: (PDT) I Page 10 of ll This certificate cancels and suporsedos ALL previously issued certificates. 248 73 COMMERCIAL GE!NEF?AL LIABILltY CG20 370413 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ ITCAREFULLY~ ADDITIONAL INSURED -OWNERS1 LESSEES OR CONTRACTORS --COMPLETED OPERATIONS This endorsement modifies Insurance provided:under thefollowlng: COMMERCIAL <3ENERAL LIABILITY COVERAGE' PART PRODUCTS/COMPlEJEO OPE:RATIONS LIAB.lllTY COVE~AGE PART SCHEDULE Name; Of.A,ddftlonal lnsure.d Person(s) . . . . . . ... . . . .. . OrOrctanizatlon(s) Location And trescrlDtlon Of Comoleted ODeratfons tl!li~~f-:lll~il'.lg~ntij~imfl;iifsoffi¢~ts,.ele~te~bt" Aa RequlredByJNrlttenContract, Fully Executed Prior appoint(:)£1; 01fl~alsternplb~es1.as;ei!lts ,ai11t¥dlunteers; · : To 'fhe: Named lnsur~d's Work Attn: fir~'Chief · '2000 Main Street Hvntlngton Beach, CA 92~48 lnformatlon required ~. complete this Schedule,• 1r not:shown above, will be shQwn hl the Declarations: \ A. $ectlon U -Wh~, hrAn ln1;ured rs iamended to lnQlude as an additional Insured the pe~oo{s) or organlzatlon(s) shown In the Sehedule. but only with respe9t lo liability · for "bqdily lnju!y!' or ''property damage" caused, ft:1 whole or In parti by "your work" at the location. designated and aescribec1 In the Schedul~. 9f this endorsement performed for that additional. insured .and irtcllldect In the "proaucts-rompleted operations hazard'\ How.ever: 1. The Insurance afforded . to such addltlonal lns.ured only applies to the extent permitted by,law;and 2 •.. If coverage proylded to thie addltl9hal 1.nsured Is required .bya contract: or .agreement. the Insurance afforded to such addltfonal Insured will not. be broadrar th13n that which you are requit~ci bY the 9c,mtract or agreement to provide for such additional insured. a; With ·respect to .the insurance afforded to these additional insureds, the following · Is aade(;I to Section Ill-Limits, Oftnsurance: . If coverage f)ro>tlded to the additional Insured t.s requlred by a contra~ or agreement, the most' we will pay Oil behalf Of the Eiddltlonal lrisured is the am.cunt oflnsur~nce: 1. Required by the contract or agreement; or 2. Available under. the applicable Limits of Insurance• shown In the Declarations; whichever Is (esS'. Tlilsendorsement:shall .not Increase. theapplicable Limits oflnsurance: shown, tn the Declarations. CG 20 37 0413 @ hw1,1rance Services Qffice,. lnc.i 20.12 Page1 of1 249 74 COMMl:RCIAL GENERAL LIABII.ITY CG 20 01 0413' THIS ENOQRSEMENT CHAN.GE$ THE f>Ol..,ICY. PLEA$E READJT CARi:FULLY. PRU\IIARY AND NONCONTRIBUTORY - . OTHER.INSURANc:e CONDITION. This endor~eme.nt. modifies insurance provided· under the following: COMMERCIAL~ENERAL LIABILITY .COVERAGE PART PRODUCTS/COMPLETEDOPERATIONSLIABILITY COVERAGE•PARt· the foUt>Wlng is c:1ddec:t tq: the OthJr lnt5uranc~ Go11dition ar1c:t superi.edes c:1ny provision (o the contrary:. · rtrit'ria.ry~n,i fl':qncontr!b,ut~rtlnsJ!l~~, . 'Jhls;J~~Ut<ll1Clf: i' Ptlfll~~JE ~ll~?•o/~! ~ ~(tek .l:Qtitdbt1tf()n;fr~m, anY' C11:thero:1nsura~ee. availc:1ble, .•.• (2) Yot1, have agreed In writing irta contract or agreement th~ this ,insU~Me w<>tild .. be primary and would not seek contribution from any other in$llrartce. available to the additfonial. insl.itett to. ·an addltlona1· 1nsured under your policy provided thet: (1 l The additional Insured ls a Named Insured under.such ott.i~r lristJrance; artd CG 2001 0413 @ Insurance Services Office, Inc., 2012 250 75 WAIVER OF OUR RIGHT TO RECOVER FROM OTHERS ENDORSl:MENT • CALIFORNIA We have the right to recover our payments from anyone liable for an Injury <:Qvered by Utls pollcy. We will not enforce our right against the person or organization named in the Schedule. (This agreement applies only to the extent that you perform work under a written contract that requires you to obtain this agreement from us.) You must maintain payroll records accurately segregating the remuneration of your employees while engaged In the work described In the Schedule. · The additional premium for this endorsement shall be 2% of the California wort<ers' compensation premium otherwise due on such remuneration. schedule Additional premium Is a percent of the California Manual Workers Compensation premium. Subject to a minimum premium charge of$ 250 per policy Person or OrqanizaUon Where required by contract or written agreement prior to loss and allowed by law. Job Descripttm, Issued by 1000005402 For attachment to Polley No. Issued lo Excalibur Well Services, Inc. WC04 03 06 Ed:04/1984 Effective Oate 06/15/2024 80H85'14 I oooooos• I >:.~CALIBUR 24·25 GL/AL/XS/Equip I Sally Huynh I 6/11/2024 1:57:27 PH (POT) I PAge 8 of 11 This certificate cancels and supersedes ALL prevjouely issued certificates. Premium$ Page 1 of 1 251 76 COMMERCIAL AUTO SICA-1063 09 22 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. LESSOR-ADDITIONAL INSURED AND LOSS PAYEE -BLANKET AMENDATORY ENDORSEMENT Polley Number: 1000679533241 Effective Date: 01/31/2024 Named Insured: Excalibur Well Services, Inc. This endorsement modifies the insurance coverage form(s) listed below that have been purchased by you and evidenced as such on the Declarations page. Please read the endorsement and respective pollcy(ies) carefully. BUSINESS AUTO COVERAGE FORM MOTOR CARRIER COVERAGE FORM AUTO DEALERS COVERAGE FORM Additional Insured (Lessor): A. Coverage SCHEDULE All lessor(s) for whom coverage is required by written . contract or agreement 1. Any "leased auto" will be considered a covered "auto" you own and not a covered "auto" you hire or borrow. 2, For any "leased auto," the Who Is An Insured provision under Covered Autos Liability Coverage is changed to include as an "insured" the lessor named in the Schedule. However, the lessor ls an "insured" only for "bodily injury" or "property damage" resulting from the acts or omissions by: a. You; b. Any of your "employees" or agents; or c. Any person, except the lessor or any "employee" or agent of the lessor, operating a "leased auto" with the permission of any of the above. 3. The coverage provided under this endorsement applies to any "leased auto" until the expiration date of the applicable written contract or agreement when the lessor or his or her agent takes possession of the "leased auto," whichever occurs first. B. Loss Payable Clause 1. We will pay, as Interest may appear, you and the lessor described in this endorsement for "loss" to a "leased auto." 2. The insurance covers the interest of the lessor unless the "loss" results from fraudulent acts or omissions on your part. 3. If we make any payment to the lessor and the lessor has rights lo recover damages from another, those rights are transferred to us. The lessor must do everything necessary to secure our rights and must do nothing after "loss" to impair them. c. Notice of Cancellation 1. If we cancel the Policy, we will mail notice to the lessor in accordance with lhe Cancellation Common Policy Condition. 2. If you cancel the Policy, we will mail notice to the lessor. SICA-1063 09 22 Copyright© Starr Indemnity & Llabillly Company. All rights reserved. Includes copyrighted material of Insurance Services Office, Inc., with its permission. 804•18514 I 00000056 I EXCALIBUR 24•25 GL/AL/XS/Equit> I Sally Kuynh I 6/11/20>4 1157127 PM l~O'r) I Pogo i of 11 This certificate cancels and supersedes ALL previously issued certificates, Page 1 of2 252 77 D. Additional Definition "Leased auto" means an "auto" leased or rented to you, including any substitute, replacement or extra "auto• needed to meet seasonal or other needs, under a leasing or rental agreement that requires you to provide direct primary insurance for the lessor. All other terms and conditions of this Policy remain unchanged. Copyright@ Starr Indemnity & Llablllly Company. All rights reserved. Includes copyrighted material of Insurance Services Office, Inc., with lls permission. 80448574 I 00000056 I JXCALISUR 14•J& OL/A!./XS/Equi9 I Sally Huynh I 6/11/20?.4 I :S'J:27 PH C~DT) I Page J of ll Thia certificate cancels and supersedes ALL previously issued certi£icates. Page 2 of2 253 78 COMMERCIAL AUTO SICA-1020 (0919) THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. WAIVER OF TRANSFER OF RIGHTS OF RECOVERY AGAINST OTHERS TO US (BLANKET WAIVER OF SUBROGATION) AMENDATORYENDORSEMENT Polley Number: 1000679533241 Effective Date: 0113112024 Named Insured: Excalibur Well Services, Inc. This endorsement modifies the insurance coverage form(s) listed below that have been purchased by you and evidenced as such on the Declarations page. Please read the endorsement and respective policy(ies) carefully. AUTO DEALERS COVERAGE FORM BUSINESS AUTO COVERAGE FORM MOTOR CARRIER COVERAGE FORM A. It is hereby agree that SECTION IV -BUSINESS AUTO CONDITIONS, A. Loss Conditions, 5. Transfer Of Rights Of Recovery Against Others To Us of the Business Auto Coverage Form, and SECTION V -MOTOR CARRIER CONDITIONS, A. Loss Conditions, 5, Transfer Of Rights Of Recovery Against Others To Us of the Motor Carrier Coverage Form are deleted in their entirety and replaced with the following: If any person or organization to or for whom we make payment under this Coverage Form has rights to recover damages from another, those rights are transferred to us. That person or organization must do everything necessary to secure our rights and must do nothing after "accident" or "loss" to Impair them. However, we waive any right of recovery we may have against any person or organization to the extent required of you by a written contract executed prior to any "accident" or "loss", provided that the ''accident" or "loss" arises out of the operations contemplated by such contract. The waiver applies only to the person or organization designated in such contract. B. It is hereby agreed that SECTION IV -CONDITIONS, A. Loss Conditions, 5. Transfer Of Rights Of Recovery Against Others To us of the Auto Dealers Coverage Form is deleted In its entirely and replaced by the following: • Ir any person or organization to or for whom we make payment under this Coverage Form has rights to recover damages from another, those rights are transferred to us. That person or organization must do everything necessary to secure our rights and must do nothing after "accident" or "loss" to Impair them. However, we waive any right of recovery we may have against any person or organization to the extent required of you by a written contract executed prior lo any "accident" or "loss", provided that the "accident" or "loss" arises out of the operations contemplated by such contract. The waiver applies only to the person or organization designated in such contract. This condition does not apply to damages under Paragraph C. Locations And Operations Medical Payments Coverage of Section II -General Liability Coverages. All other terms and conditions of this Policy remain unchanged. SICA-1020 (0919) Copyright@ Starr Indemnity & Liability Company. All rights reserved. Page 1 of 1 Includes copyrighted material of Insurance Services Office, Inc., with its permission. 80•48571 I OOOOOOSG I sxcru.rnu~ 2•1-25 OL/IIL/XS/Equlp I Sally ~uynh I 6/U/202~ 1 ,57 ,n PK (Pll'fl I P•g• • of !l This certificate cancels and supersedes i\LL previously issued ce1·tificatas, 254 79 COMMERCIAL AUTO SICA-1020 (0919) However, we waive any right of recovery we may have against any person or organization to the extent required of you by a written contract executed prior to any "accident" or "loss", provided that the "accident" or "loss" arises out of the operations contemplated by such contract. The waiver applies only lo the person or organization designated in such contract. This condition does not apply to damages under Paragraph C. Locations And Operations Medical Payments Coverage of Section 11-General Liability Coverages. Ail other terms and conditions or this Policy remain unchanged. SICA-1020 (0919) Copyright© Starr Indemnity & Liability Company. All rights reserved. Includes copyrighted material of Insurance Services Office, Inc., with its permission. 80448574 I 000000~6 I SXCALISU!t 24·25 GL/AL/XS/~quip I Sally Kuynh I G/11/202< 1:57127 PII (POT} I Page 5 of II This certificate cancels and supersedes ALL previously issued certificates. Page 1 of 1 255 80 POLICY NUMBER: 1000090757241 COMMERCIAL GENERAL LIABILITY CG 24 04 05 09 WAIVER OF TRANSFER OF RIGHTS OF RECOVERY AGAINST OTHERS TO US This endorsement modifies Insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE PART SCHEDULE Name Of Person Or Organization: Any person or organization to whom you become obligated to waive your rights of recovery against, under any contract or agreement you enter into prior to the occurrence of loss. Information required to complete this Schedule if not shown above will be shown In the Declarations. The following is added to Paragraph 8. Transfer Of Rights Of Recovery Against Others To Us of Section IV -Conditions: We waive any right of recovery we may have against the person or organization shown in the Schedule above because of payments we make for injury or damage arising out of your ongoing operations or "your work" done under a contract with that person or organization and Included in the "products-completed operations hazard". This waiver applies only to the person or organization shown in the Schedule above. CG 24 04 05 09 © Insurance Services Office, Inc., 2008 80H857~ I oooooos6 I exCALIYUR 2•-2s GL/AL/XS/E<julp I Sally Huynh I 6/11/2024 1,s,,21 PK (l'll'l'I I Pagft 6 oC 11 Thie certificate cancels and supersedes ALL previously issued certificates, Page 1 of 1 256 81 SERVICE AGREEMENT BETWEEN THE CITY OF HUNTINGTON BEACH AND EXCALIBUR WELL SERVICES, CORP. FOR CIVIC CENTER WELL ABANDONMENT THIS AGREEMENT ("Agreement") is made and entered into by and between the City of Huntington Beach, a municipal corporation of the State of California, hereinafter called "City," and Excalibur Well Services, Corporation, hereinafter referred to as "Contractor." Recitals A. The City desires to retain a Contractor having special skill and knowledge in the field of Well Abandonment. B. Contractor represents that Contractor is able and willing to provide such services to the City. C. In undertaking the performance of this Agreement, Contractor represents that it is knowledgeable in its field and that any services performed by Contractor under this Agreement will be performed in compliance with such standards as may reasonably be expected from a comparable company or firm in the field. Contractor has been selected to perform these services pursuant to Huntington Beach Municipal Code Chapter 3.02. NOW, THEREFORE, it is agreed by City and Contractor as follows: 1. Scope of Services Contractor shall provide all services as described in Exhibit "A," which is attached hereto and incorporated into this Agreement by this reference. These services shall sometimes hereinafter be referred to as the "Project." Contractor hereby designates Steve Martinez who shall represent it and be its sole contact and agent in all consultations with City during the performance of this Agreement. 2. City Staff Assistance City shall assign a staff coordinator to work directly with Contractor in the performance of this Agreement. 23-13 803/324318 1 82 3. Compensation a. City agrees to pay, and Contractor agrees to accept as total payment for its services, the rates and charges identified in Exhibit "B." The total sum to be expended under this Agreement, shall not exceed One Million Ninety-Nine Thousand Seven Hundred Seventy Dollars ($1,099, 770.00) during the term of this Agreement. b. Payment by City shall be made within thiliy (30) days following receipt of proper invoice evidencing work performed, subject to City accounting procedures. Payment need not be made for work which fails to meet the standards of performance set fo1ih in the Recitals which may reasonably be expected by City. c. Contractor shall be paid pursuant to the terms of Exhibit "B." 4. Term Time is of the essence of this Agreement. The services of Contractor are to commence W-/.20/20<-Y, or as soon as practicable after the execution of this Agreement by City (the "Commencement Date") and terminate three (3) years from Commencement Date, unless terminated earlier in accordance with the provisions of this Agreement. Contract may be extended for 2 additional one-year periods if mutually agreed to in writing by both parties. The time for performance of the tasks identified in Exhibit "A" are generally to be shown in Exhibit "A." This schedule and Term may be amended to benefit the Project if mutually agreed to in writing by City and Contractor. In the event the Commencement Date precedes the Effective Date, Contractor shall be bound by all terms and conditions as provided herein. 5. Extra Work In the event City requires additional services not included in Exhibit "A" or changes in the scope of services described in Exhibit "A," Contractor will undertake such work only after receiving written authorization from City. Additional compensation for such extra work shall be allowed only if the prior written approval of City is obtained. 6. Disposition of Plans, Estimates and Other Documents Contractor agrees that title to all materials prepared hereunder, including, without limitation, all original drawings, designs, reports, both field and office notices, calculations, computer code, language, date or programs, maps, memoranda, letters and other documents, shall belong to City, and Contractor shall turn these materials over to City upon expiration or termination of this Agreement or upon Project completion, whichever shall occur first. These materials may be used by City as it sees fit. 23-13 803/324318 2 83 7. Hold Harmless Contractor hereby agrees to protect, defend, indemnify and hold harmless City, its officers, elected or appointed officials, employees, agents, and volunteers from and against any and all claims, damages, losses, expenses, judgments, demands and defense costs, and consequential damage or liability of any kind or nature, however caused, including those resulting from death or injury to Contractor's employees and damage to Contractor's property, arising directly or indirectly out of the obligations or operations herein undertaken by Contractor, caused in whole or in part by any negligent act or omission of the Contractor, any subcontractors, anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable, including but not limited to concurrent active or passive negligence, except where caused by the active negligence, sole negligence, or willful misconduct of the City. Contractor will conduct all defense at its sole cost and expense and City shall approve selection of Contractor's counsel. This indemnity shall apply to all claims and liability regardless of whether any insurance policies are applicable. The policy limits do not act as a limitation upon the amount of indemnification to be provided by Contractor. 8. Workers Compensation Insurance Pursuant to California Labor Code Section 1861, Contractor acknowledges awareness of Section 3 700 et seq. of this Code, which requires every employer to be insured against liability for workers' compensation; Contractor covenants that it will comply with such provisions prior to commencing performance of the work hereunder. Contractor shall obtain and furnish to City workers' compensation and employer's liability insurance in an amount of not less than the State statutory limits. Contractor shall require all subcontractors to provide such workers' compensation and employer's liability insurance for all of the subcontractors' employees. Contractor shall furnish to City a certificate of waiver of subrogation under the terms of the workers' compensation and employer's liability insurance and Contractor shall similarly require all subcontractors to waive subrogation. 9. General Liability Insurance In addition to the workers' compensation and employer's liability insurance and Contractor's covenant to defend, hold harmless and indemnify City, Contractor shall obtain and furnish to City, a policy of general public liability insurance, including motor vehicle coverage covering the Project/Service. This policy shall indemnify Contractor, its officers, employees and agents while acting within the scope of their duties, against any and all claims arising out of or in connection with the Project/Service, and shall provide coverage in not less than the following amount: combined single limit bodily injury and property damage, including products/completed operations liability and blanket contractual liability, of One Million Dollars ($1,000,000) per occurrence. If coverage is provided under a form which includes a designated general aggregate limit, 23-13 803/324318 3 84 the aggregate limit must be no less than One Million Dollars ($1,000,000) per occurrence. If coverage is provided under a form which includes a designated general aggregate limit, the aggregate limit must be no less than One Million Dollars ($1,000,000) for this Project/Service. This policy shall name City, its officers, elected or appointed officials, employees, agents, and volunteers as Additional Insureds, and shall specifically provide that any other insurance coverage which may be applicable to the Project/Service shall be deemed excess coverage and that Contractor's insurance shall be primary. Under no circumstances shall said above-mentioned insurance contain a self- insured retention, or a "deductible" or any other similar form of limitation on the required coverage. 10. Automobile Liability Insurance Contractor shall obtain and furnish to City an automotive liability insurance policy covering the work performed by it hereunder. This policy shall provide coverage for Contractor's automotive liability in an amount not less than One Million Dollars ($1,000,000.00) per occurrence and a separate "Additional Insured Endorsement" page listing both the policy number and naming the "City of Huntington Beach, its officers, elected or appointed officials, employees, agents and volunteers" as additional insured on the endorsement. The above-mentioned insurance shall not contain a self-insured retention, "deductible" or any similar form of limitation on the required coverage except with the express written consent of City. 11. Certificate of Insurance Prior to commencing performance of the work hereunder, Contractor shall furnish to City a certificate of insurance subject to approval of the City Attorney evidencing the foregoing insurance coverage as required by this Agreement; the certificate shall: a. provide the name and policy number of each carrier and policy; b. state that the policy is currently in force; and c. promise that such policy shall not be suspended, voided or canceled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice; however, ten (10) days' prior written notice in the event of cancellation for nonpayment of premium. Contractor shall maintain the foregoing insurance coverage in force until the work under this Agreement is fully completed and accepted by City. This requirement for carrying the foregoing insurance coverage shall not derogate from Contractor's defense, hold harmless and indemnification obligations as set forth in this Agreement. City or its representative shall at all times have the right to demand the original or a copy of the policy of insurance. Contractor shall pay, in a prompt and timely manner, the premiums on the insurance hereinabove required. 23-13 803/324318 4 85 12. Independent Contractor Contractor is, and shall be, acting at all times in the performance of this Agreement as an independent contractor herein and not as an employee of City. Contractor shall secure at its own cost and expense, and be responsible for any and all payment of all taxes, social security, state disability insurance compensation, unemployment compensation and other payroll deductions for Contractor and its officers, agents and employees and all business licenses, if any, in connection with the Project and/or the services to be performed hereunder. 13. Conflict of Interest Contractor covenants that it presently has no interests and shall not have interests, direct or indirect, which would conflict in any manner with performance of services specified under this Agreement. 14. Termination This Agreement may be terminated by the City upon thirty (30) days written notice of termination. In such event, Contractor shall be entitled to receive and the City shall pay Contractor compensation for all services performed by Contractor prior to receipt of such notice of termination, subject to the following conditions: a. As a condition of such payment, the Director may require Contractor to deliver to the City all work product completed as of such date, and in such case such work product shall be the property of the City unless prohibited by law, and Contractor consents the City's use thereof for such purposes as the City deems appropriate. b. Payment need not be made for work which fails to meet the standard of performance specified in the Recitals of this Agreement. 15. Exclusivity and Amendment This Agreement represents the complete and exclusive statement between the City and Contractor, and supersedes any and all other agreements, oral or written, between the parties. In the event of a conflict between the terms of this Agreement and any attachments hereto, the terms of this Agreement shall prevail. This Agreement may not be modified except by written instrument signed by the City and by an authorized representative of Contractor. The parties agree that any terms or conditions of any purchase order or other instrument that are inconsistent with, or in addition to, the terms and conditions hereof, shall not bind or obligate Contractor or the City. Each party to this Agreement acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which are not embodied herein. 23-13803/324318 5 86 16. Assignment Inasmuch as to this Agreement is intended to secure the specialized services of Contractor, Contractor may not assign, transfer, delegate, or subcontract any interest herein without the prior written consent of the City and any such assignment, transfer, delegation or subcontract without the City's prior written consent shall be considered null and void. Nothing in this Agreement shall be construed to limit the City's ability to have any of the services which are the subject to this Agreement performed by City personnel or by other Contractors retained by City. 17. City Employees and Officials Contractor shall employ no City official nor any regular City employee in the work performed pursuant to this Agreement. No officer or employee of City shall have any financial interest in this Agreement in violation of the applicable provisions of the California Government Code. 18. Notices Any notices, certificates, or other communications hereunder shall be given either by personal delivery to Contractor's agent (as designated in Section 1 hereinabove) or to City as the situation shall warrant, or by enclosing the same in a sealed envelope, postage prepaid, and depositing the same in the United States Postal Service, to the addresses below. City and Contractor may designate different addresses to which subsequent notices, certificates or other communications will be sent by notifying the other party via personal delivery, a reputable overnight carrier or U.S. certified U.S. certified mail-return receipt requested: To City: City of Huntington Beach Attn: Fire Chief 2000 Main Street Huntington Beach, CA 92648 19. Consent Contractor: Excalibur Well Services Corporation Attn: Steve Martinez 22034 Rosedale Highway Bakersfield, CA 93314 When City's consent/approval is required under this Agreement, its consent/approval for one transaction or event shall not be deemed to be a consent/approval to any subsequent occurrence of the same or any other transactions or event. 20. Modification No waiver or modification of any language in this Agreement shall be valid unless in writing and duly executed by both parties. 23-13 803/324318 6 87 21. Section Headings The titles, captions, section, paragraph and subject headings, and descriptive phrases at the beginning of the various sections in this Agreement are merely descriptive and are included solely for convenience of reference only and are not representative of matters included or excluded from such provisions, and do not interpret, define, limit or describe, or construe the intent of the parties or affect the construction or interpretation of any provision of this Agreement. 22. Interpretation of this Agreement The language of all parts of this Agreement shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties. If any provision of this Agreement is held by an arbitrator or court of competent jurisdiction to be unenforceable, void, illegal or invalid, such holding shall not invalidate or affect the remaining covenants and provisions of this Agreement. No covenant or provision shall be deemed dependent upon any other unless so expressly provided here. As used in this Agreement, the masculine or neuter gender and singular or plural number shall be deemed to include the other whenever the context so indicates or requires. Nothing contained herein shall be construed so as to require the commission of any act contrary to law, and wherever there is any conflict between any provision contained herein and any present or future statute, law, ordinance or regulation contrary to which the parties have no right to contract, then the latter shall prevail, and the provision of this Agreement which is hereby affected shall be curtailed and limited only to the extent necessary to bring it within the requirements of the law. 23. Duplicate Original The original of this Agreement and one or more copies hereto have been prepared and signed in counterparts as duplicate originals, each of which so executed shall, iiTespective of the date of its execution and delivery, be deemed an original. Each duplicate original shall be deemed an original instrument as against any party who has signed it. 24. Immigration Contractor shall be responsible for full compliance with the immigration and naturalization laws of the United States and shall, in particular, comply with the provisions of the United States Code regarding employment verification. 25. Legal Services Subcontracting Prohibited Contractor and City agree that City is not liable for payment of any subcontractor work involving legal services, and that such legal services are expressly outside the scope of services contemplated hereunder. Contractor understands that pursuant to Huntington Beach City Charter Section 309, the City Attorney is the exclusive legal counsel for City; 23-13803/324318 7 88 and City shall not be liable for payment of any legal services expenses incurred by Contractor. 26. Confidentiality Contractor recognizes that in the performance of its duties under this Agreement, it must conduct its activities in a manner designed to protect information of a sensitive nature from improper use or disclosure. Contractor warrants that it will use reasonable efforts consistent with practices customary in the facilities management industry in recruiting, training and supervising employees and in otherwise performing its duties hereunder in order to achieve this result. In the furtherance of this, Contractor agrees, at the request of the City, to require its employees to execute written undertakings to comply with the foregoing confidentiality provision. 27. Discrimination Contractor shall not discriminate because of race, color, creed, religion, sex, marital status, sexual orientation, age, national origin, ancestry, or disability, as defined and prohibited by applicable law, in the recruitment, selection, training, utilization, promotion, termination or other employment related activities. Contractor affirms that it is an equal opportunity employer and shall comply with all applicable federal, state and local laws and regulations. 28. Jurisdiction -Venue This Agreement and all questions relating to its validity, interpretation, performance, and enforcement shall be government and construed in accordance with the laws of the State of California. This Agreement has been executed and delivered in the State of California and the validity, interpretation, performance, and enforcement of any of the clauses of this Agreement shall be determined and governed by the laws of the State of California. Both parties further agree that Orange County, California, shall be the venue for any action or proceeding that may be brought or arise out of, in connection with or by reason of this Agreement. 29. Professional Licenses Contractor shall, through the term of this Agreement, maintain all necessary licenses, permits, approvals, waivers, and exemptions necessary for the provision of the services hereunder and required by the laws and regulations of the United States, the State of California, the City of Huntington Beach and all other governmental agencies. Contractor shall notify the City immediately and in writing of her inability to obtain or maintain such permits, licenses, approvals, waivers, and exemptions. Said inability shall be cause for termination of this Agreement. 23-13 803/324318 8 89 30. California Prevailing Wage Law A. The City has ascertained from the Director of Industrial Relations of the State of California the general prevailing rate of per diem wages and the general prevailing rate for legal holiday and overtime work in the locality in which the work is to be performed for each craft or type of work needed to execute this Agreement, and the same has been set forth by 14 16-5195/City Funded Construction Contract.docx -revised 04/2016 resolution on file in the office of the City Clerk of City. Contractor and any subcontractor under it shall pay not less than said prevailing wage rates to all workers employed on this public works Agreement, as required by California Labor Code Sections 1771 and 1774. In accordance with the provisions of Section 3700 of the California Labor Code, Contractor agrees to secure payment of compensation to every employee. B. Pursuant to this Agreement and in accordance with Section 1774 and 1775 of the California Labor Code, Contractor shall, as penalty to City, forfeit twenty-five dollars ($25) for each calendar day or portion thereof for each worker paid ( either by Contractor or any of its subcontractors) less than the prevailing wage rate established for that particular craft or type of work. 31. Attorney's Fees In the event suit is brought by either party to construe, interpret and/or enforce the terms and/or provisions of this Agreement or to secure the performance hereof, each party shall bear its own attorney's fees, such that the prevailing party shall not be entitled to recover its attorney's fees from the non-prevailing party. 32. Survival Terms and conditions of this Agreement, which by their sense and context survive the expiration or termination of this Agreement, shall so survive. 33. Governing Law This Agreement shall be governed and construed in accordance with the laws of the State of California. 34. Signatories Each undersigned represents and warrants that its signature hereinbelow has the power, authority and right to bind their respective parties to each of the terms of this Agreement, and shall indemnify City fully for any injuries or damages to City in the event that such authority or power is not, in fact, held by the signatory or is withdrawn. 35. Entirety (a) The parties acknowledge and agree that they are entering into this Agreement freely and voluntarily following extensive arm's length negotiation, and that 23-13 803/324318 9 90 each has had the opportunity to consult with legal counsel prior to executing this Agreement. The parties also acknowledge and agree that no representations, inducements, promises, agreements or warranties, oral or otherwise, have been made by that party or anyone acting on that party's behalf, which are not embodied in this Agreement, and that that party has not executed this Agreement in reliance on any representation, inducement, promise, agreement warranty, fact or circumstance not expressly set forth in this Agreement. (b) All Exhibits referenced herein and attached hereto shall be incorporated as if fully set forth in the body of this Agreement. 36. Effective Date IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by and through their authorized officers. This Agreement shall be effective on the date of its approval by the Mayor. This Agreement shall expire when terminated as provided herein. CONTRACTOR EXCALIBUR WELL SERVICES, CORP. Print name ITS: ( circle one)_!.JJ.a!!ir:.nllwt.,~· ~:effi'fl--;::;:;-- Vice President C. \\ i 'Cr i,<-e c.,.Jt,',1-e DCr': (:l COUNTERPART 23-13803/324318 10 CITY OF HUNTINGTON BEACH, a municipal corporation of the State of California Mayor City Clerk INITIATED AND APPROVED: om Fire Chief 91 each has had the opportunity to consult with legal counsel prior to executing this Agreement. The parties also acknowledge and agree that no representations, inducements, promises, agreements or warranties, oral or otherwise, have been made by that paiiy or anyone acting on that party's behalf, which are not embodied in this Agreement, and that that paiiy has not executed this Agreement in reliance on any representation, inducement, promise, agreement warranty, fact or circumstance not expressly set forth in this Agreement. (b) All Exhibits referenced herein and attached hereto shall be incorporated as if fully set forth in the body of this Agreement. 36. Effective Date IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by and through their authorized officers. This Agreement shall be effective on the date of its approval by the Mayor. This Agreement shall expire when terminated as provided herein. CONTRACTOR EXCALIBUR WELL SERVICES, CORP. By: _____________ _ Print name ITS: ( circle one) Chairman/President/ Vice President AND By: _____________ _ Print name ITS: ( circle one) Secretary/Chief Financial Officer/ Asst. Secretary-Treasurer COUNTERPART 23-13803/324318 10 CITY OF HUNTINGTON BEACH, a municipal corporation of the State of California £~1.ui-1-~ City Clerk ,.2,/~~ INITIATED AND APPROVED: zyJfj Fire Chief 92 REVIEWED AND APPROVED: t;;/4n;jiL COUNTERPART 23-13803/324318 11 93 EXHIBIT "A" A. STATEMENT OF WORK: (Narrative of work to be performed) See attached Exhibit A. B. CONSULTANT'S DUTIES AND RESPONSIBILITIES: SEE ATTACHED EXHIBIT A C. CITY'S DUTIES AND RESPONSIBILITIES: D. WORK PROGRAM/PROJECT SCHEDULE: 23-I 3803/3243 I 8 11 94 EXHIBIT A \\'El ,I. SER\'ICl•:S CC >RI! Progra1n Steps ·Huntington Beach Field Civic Center Lease Civic Center 1 API # 04-059-02421 • Mobilize rig and all equipn1ent to Civic Center 1. • Move in rig up hoist, 1nud pump, 2.5 power swivel, storage tank, catch tank, pipe trailer, & BOPE. • Monitor atmosphere for H2S, gases, and all other hazards. Monitor tubing and casing pressures. (Report to Co1npany Representative). NOTE: According to lease operator, all 3 wells have less than 20 ps1. • Install rod BOPE and function test (Report to Company Representative). Rig up rod equipment and lay down rod assembly on a trailer, so we n1ay haul the rods off and properly dispose of. • Nipple up 8'' 900 series BOPE (blow out prevention equipment) with accmnulator and function test BOPE per CalGEM's requirements. NOTE: Will nipple up BOPE onto an 8" non API well head. CalGEM to witness BOPE test. • Pull out of hole with original production string. All tubing will be laid onto a pipe trailer and hauled off. 22034 1wseaa(e J-{tgfiway, 'Bafforsfie(c(, CJ\. 93314 Pftone: 661,589.5338 :Jax: 661.58.9.1089 95 • Run in hole with 7" all weight scraper to 2175' +/-with 2-7 /8" 6.5# N-80 eue tubing. • Run in hole with 7" 20/23# bridge plug to 2175' +/-with 2-7 /8" 6.5# N-80 eue tubing. Set bridge plug@ 2175' +/-and pull out of hole with tubing assen1bly. • Fill 7" casing with water and monitor well for any gases. Pressure test casing to 500 psi (Report to Co1npany Representative). • Nipple down 6" 900 series BOPE. • Cold cut 7" casing one foot below original well head and weld on 6" 900 series slip on well head flange. NOTE: Hot work permit will be required. • Nipple up 6" 900 series BOPE (blow out prevention equipment) with accun1ulator and function test BOPE per Cal GEM' s requiren1ents (Report to Company Representative). CalGEM to witness BOPE test. • Run in hole with 7" bridge plug retrieving tool and 2-7 /8" tubing to top of bridge plug@ 2175' +/-. Release bridge plug and monitor well pressure before attempting to pull out of hole (Report to Con1pany Representative). • Pull out of the hole with 7" bridge plug and 2-7 /8" tubing assembly. • Run in hole with 5-1/2" 15# casing spear, bumper sub, hydraulic jars, energizer, and 2-7/8" 6.5# N-80 eue tubing to the top of the 5- 1/2" 15# sleeve @2184'. Spear in to 5-1/2" casing and work 5- 1 /2" casing sleeve free. 22034 'Rosetfa(e Jligliway, 'Bafiersfie(d; CJ\. 93314 Plione: 661.589.5338 :Fax: 661,589.1089 96 • Pull out of hole with 5-1/2" 15# casing sleeve, 2-7 /8" tubing assembly. Rig up 5-1/2" casing tongs and lay down 306' (7 or 8 sticks) of 5-1/2" 15# casing on a trailer, so we n1ay haul the casing off and properly dispose of. • Run in hole with 4-3/4" drill bit and 2-7/8" 6.5# N-80 eue tubing while possibly having to clean out fron1 2950' to 4003' (Report to Company Representative). NOTE: CalGEM to witness cleanout tag. • Rig up wireline and install wireline 2M lubricator (function test). Fi11 hole with water. Log (CBL) cased hole from cleanoi1t depth to surface (Report to Con1pany Representative). NOTE: Squeeze jobs n1ay not be necessary based on CBL. • Run in hole with 2-7 /8" 6.5# N-80 eue open ended tubing to 4003' and rig up ce1nent equip1nent. Pump class G ce1nent from 4003' to 3403' in two 300' stages. NOTE: CalGEM to witness. • Run in hole with 2-7 /8" tubing and tag top of cetnent plug @ 3403' (CalGEM to witness). Rig up cen1ent equipment and pmnp class G ce1nent fron1 3403' to 2803' in two 300' stages. NOTE: CalGEM to witness. • Run in hole with 2-7 /8" tubing and tag top of ce1nent plug @ 2803' (CalGEM to witness). Rig up cement equipn1ent and pump class G cement fro111 2803' to 2490' in one stage. NOTE: CalGEM to witness. • Run in hole with 2-7 /8" tubing and tag top of cement plug@ 2490' (CalGEM to witness). Rig up cement equipment and pump class G ce111ent from 2490' to 2355' in one stage. NOTE: CalGEM to witness. 22034 'Rosec(a{e Higfnva:y, 'Bafi.ersfie{c{, CJ\ 93314 Plione: 661,589,5338 :fax: 661.589.1089 97 • Run in hole with 2-7/8" tubing and tag top of ce1nent plug@ 2355' . (CalGEM to witness). Rig up cement equipn1ent and pump class G cement fron1 2355' to 1800' in two 277.5' stages. NOTE: CalGEM to witness. • Run in hole with 2-7/8" tubing and tag top of cement plug@ 1800' (CalGEM to witness). Rig up cen1ent equipn1ent and pump class G cement fron1 1800' to 1400' in one stage. NOTE: CalGEM to witness. • Run in hole with 2-7/8" tubing and tag top of cement plug@ 1400' (CalGEM to witness). Putnp 52 barrels of73# 26 shear abandon1nent 1nud. Abandonn1ent will be placed fr0111 1400' to 150' fron1 surface. NOTE: CalGEM to witness. • Rig up wireline and install wireline 2M lubricator (function test). Perforate 4 half inch holes per foot from 150' to 145', 20 total shots. (Report to Company Representative). • Run in hole with 2-7 /8" tubing to 150'. Rig up cen1ent equipn1ent and pu111p class G ce1nent from 150' to surface (inside and outside of casing. NOTE: CalGEM and Huntington Beach Fire Department to witness. • Nipple down 8" 900 series BOPE and secure well. Rig down hoist and rig out all equipment. • Witness cen1ent at surface, perforn1 leak test (?), cut casing between 5' and 10' from surface grade, tac weld metal top plate onto casing with required information, install vent cone and co1nplete surface restoration (restore job sit). NOTE: CalGEM and Huntington Beach Fire Departn1ent to witness. "Job Complete" 22034 'R.oseaa(e _'l{igfi:way, 'Bafi.ersfie(c(, CJ\ 93314 ~Pfwne: 661.589.5338 :fax: 661.589.1089 98 Location Layout Civic Center 1 -04-059-02421 Excalibur's Best Practice is Right in / Right out when arriving and departing location. (Safe Meeting areas and Entrances may change due to well, site, and safety considerations) 99 Proposed Equipment Layout Civic Center 1 -04-059-02421 100 Haul Route Excalibur Well Service Satellite Yard to Civic Center 1 t Head west toward S Main St 50 ft PTurn right onto main st Q.2mi PTurn right onto E Sepulveda Blvd 1.2mi ~Turn left onto S Wilmington Ave 1.4 P Turn right onto the 1-405 S ramp 0.2 ~ Merge onto 1-405 S (24 miles) ~Keep left at the fork to stay on 1-405 S 2.9 ~Take exit 18 for Bolsa Ave toward Goldenwest St 0.1 mi ~ Keep right to stay on Exit 18 follow signs for Bolsa Ave Golden West College 0.2 mi ~ Turn left onto Westminster Mall 350ft PTurn right onto Goldentwest St 4.6 ~ Turn left onto Yorktown Ave 0.4ml PTurn right onto Union Ave 50ft Huntington Beach Civic Center 2000 Main St Huntington Beach, Ca. 101 Emergency Route Civic Center 1 to nearest Hospital (2.5 mile) t Exit location head Northeast on Union Ave toward Yorktown Ave 50ft PTurn right onto Yorktown Ave 0.6mi fi Turn left onto Beach Blvd 150ft PTurn right Ronalc;I Dr 135ft P Turn right 171ft fi Turn left 410ft firurn left 207ft P Turn right 167ft Huntington Beach Hospital-HB Hospital 17772 Beach Blvd, Huntington Beach, Ca. 92647 102 Route for First Aid Civic Center 1 to CareOnSite (25.7 miles) t Exit location head Northeast on Union Ave toward Yorktown Ave soft rTurn right onto Yorktown Ave 0.6ml f-t Turn left onto Beach Blvd 3.7ml rTurn right onto the 1-405 N ramp 0.6ft ~ Merge onto 1-405 N 5.9ml f-t Keep left to stay on 1-405 N 14ml ~Take exit 36 for Mc;1in St Q.3mi f-trurn left onto Figueroa St Q.7mi rrurn right onto W Del Amo Blvd 0.3 rrurn right 100ft f-trurn left 150ft CareOnSite 20300c S Vermont Ave, Torrace CA 90502 103 Progra1n Steps Huntington Beach Field Civic Center Lease Civic Center 2 API # 04-059-02447 • Mobilize rig and all equipn1ent to Civic Center 2. • Move in rig up hoist, mud pump, 2.5 power swivel, storage tank, catch tank, pipe trailer, & BOPE. • Monitor atmosphere for H2S, gases, and all other hazards. Monitor tubing and casing pressures. (Report to Con1pany Representative). NOTE: According to lease operator, all 3 wells have less than 20 . ps1. • Install rod BOPE and function test (Report to Company Representative). Rig up rod equipn1ent and lay down rod assen1bly on a trailer, so we may haul the rods off and properly dispose of. • Nipple up 1 O" 900 series BOPE (blow out prevention equip1nent) with accumulator and function test BOPE per CalGEM's requirements. NOTE: CalGEM to witness. • Pull out of hole with original production string. All tubing will be laid onto a pipe trailer and hauled off. 22034 J\oseaa(e .1figfiway, 'BaRersfie(c{, C.Jt 93314 'Plione: 661,589.5338 :fax: 661,589.1089 104 • Run in hole with 7-5/8" drill bit, four 4-3/4" drill collars, and 2- 7 /8" 6.5# N-80 eue tubing to top of 8-5/8" 32/36# casing stub @ 2550'. Enter 8-5/8" casing and continue running in hole to top of ce111ent plug@ 2732'. Rig up 2.5 power swivel, bi-eak circulation with working mud, and clean out from 2732' to 2750'. Ce1nent plug and wood plug fron1 2732' to 2750'. Cavity shot from 2743' to 2750'. Continue running in hole to top of 6-5/8" 26# casing stub @ 3265'. (Report to Company Representative). • Run in hole with 5-5/8" drill bit, four 4-3/4" drill collars, and 2- 7 /8" 6.5# N-80 eue tubing to top of ce1nent and wooden plug@ 3243 '. Rig up 2.5 power swivel, break circulation with working 1ny, and clean out fron13243' to 3265'. Tag 6-5/8" 26# casing stub @ 3265'. Enter 6-5/8" casing and continue running in hole while cleaning out to top of cement plug@ 3442' (Rep01i to Company Representative). • Rig up wireline and install 2M lubricator (function test). Fill hole with water. Log (CBL) cased hole fron1 cleanout depth to surface (Report to Con1pany Representative). NOTE: Squeeze jobs may be necessary based on top ofUSDW and BFW, according to estin1ated top of cement outside 11-3/4" casing. • Run in hole with 2-7 /8" 6.5# N-80 eue open ended tubing to 3442' and rig up cen1ent equipment. Pun1p class G cement from 3442' to 3165' in one stage (estimated 100' on top of6-5/8" stub). NOTE: CalGEM to witness. • Run in hole with 2-7 /8" tubing and tag top of cen1ent plug @ 3165' (CalGEM to witness). Rig up cement equipment and pun1p class G cen1ent from 3165' to 2732' in two 216.5' stages. NOTE: CalGEM to witness. 22034 'RosecCa(e J[igliway, 'Baliersfie(c(, CA 93314 Phone: 661.589.5338 :fax: 661,589.1089 105 • Run in hole with 2-7 /8" tubing and tag top of cement plug @ 2732' (CalGEM to witne$S). Rig up cen1ent equipn1ent and pump class G cen1ent from 2732' to 2450' in one stage (esti1nated 100' on top of 8-5/8" stub). NOTE: Cal GEM to witness. • Run in hole with 2-7 /8" tubing and tag top of cement plug@ 2450' (CalGEM to witness). Pressure test casing to 500 psi. Rig up ce111ent equipment and pump class G ce111ent fron1 2450' to 2030' in one stage (estimated top of ce111ent on the outside of the 11-3/4" casing. NOTE: CalGEM to witness. • Rig up wireline and install wireline 2M lubricator (function test). Perforate 4 half inch holes per foot fr01n 1900' to 1895', 20 total shots (Report to Company Representative). CalGEM to witness. • Run in hole with 2-7 /8" tubing and tag top of cement plug@ 2030' (CaIGE.M to witness). Rig up ce111ent equipment and pump class G cement from 2030' to 1800' in one stage. Braden head squeeze 100 linear feet outside 11-3/4" casing. NOTE: CalGEM to witness. • Rig up wireline and install wireline 2M lubricator (function test). Perforate 4 half inch holes per foot from 1500' to 1495 ', 20 total shots (Report to Company Representative). CalGEM to witness. • Run in hole with 2-7/8" tubing and tag top of ce111ent plug@ 1800' (CalGEM to witness). Rig up ce111ent equipment and pmnp class G cement fr01n 1800' to 1400' in one stage. Braden head squeeze 100 linear feet outside 11-3/4" casing. NOTE: CalGEM to witness. • Run in hole with 2-7 /8" tubing and tag top of cement plug@ 1400' (Cal GEM to witness). Pump 150 barrels of 73# 26 shear abandonment mud. Abandomnent mud will be placed from 1400' to 150' fron1 surface. NOTE: CalGEM to witness. 22034 1wseaa(e Jfigfi:way, 'Bafierifiela, CJ\ 93314 1>/iom: 661,589,5338 jax: 661.589.1089 106 • Rig up wireline and install wireline 2M lubricator (function test). Perforate 4 half inch holes per foot from 150' to 145', 20 total shots. (Report to Con1pany Representative). • Run in hole with 2-7 /8" tubing to 150'. Rig up cen1ent equipn1ent and pump class G cement from 150' to surface (inside and outside of casing. NOTE: CalGEM and Huntington Beach Fire Department to witness. • Nipple down 1 0" 900 series BOPE and secure well. Rig down hoist and rig out all equip1nent. • Witness cement at surface, perforn1 leak test(?), cut casing between 5' and 10' fr01n surface grade, tac weld n1etal top plate onto casing with required information, install vent cone and con1plete surface restoration (restore job sit). NOTE: Cal GEM and Huntington Beach Fire Department to witness. "Job Complete" 22034 'Roseaa{e J-figfiway, 'Baker.ifie{d; C.'A. 93314 Tlione: (-;61,589.5338 :Jax: 661.589.1089 107 Location Layout Civic Center 2 -04-059-0244 7 Excalibur's Best Practice is Right in / Right out when arriving and departing location. (Safe Meeting areas and Entrances may change due to well, site, and safety considerations) 108 Proposed Equipment Layout Civic Center 2 -04-05ij-02447 109 Haul Route Excalibur Well Service Satellite Yard to Civic Center 2 1' Head west toward S Main St 50 ft rrurn right onto main st 0.2ml rrurn right onto E Sepulveda Blvd 1.2ml f-irurn left onto s Wilmington Ave 1.4 P Turn right onto the 1-405 S ramp Q.2 ~ Merge onto 1-405 s (24 miles) f-i Keep left at the fork to stay on 1-405 S 2.9 r-">rake exit 18 for 8olsa Ave toward Goldenwest St 0.1 mi rt Keep right to stay on Exit 18 follow signs for Balsa Ave Golden West College 0.2 ml f-irurn left onto Westminster Mall 350ft PTurn right onto Goldentwest St 4.6 f-i Turn left onto Yorktown Ave 0.4ml Prurn right onto Union Ave 150ft rrurn right left Huntington Beach Civic Center 2000 Main St Huntington Beach, Ca. 110 Emergency Route Civic Center 2 to nearest Hospital (2.5 mile) t Exit location head south towan;ls Union Ave toward Yorktown Ave 100ft fi Turn left onto Union Ave 100ft r>Turn right onto Yorktown Ave 0.6mi fi Turn left onto Beac;h Blvd 1.7mi r>Turn right Ronald Or 150ft r> Turn right 150ft ~ Turn left 400ft ~Turn left 200ft r> Turn right 150ft Huntington Beach Hospital -HB Hospital 17772 13each Blvd, Huntington Beach, Ca. 92647 111 Route for First Aid Civic Center 1 to CareOnSite (2S.7 miles) 1' 1' Exit location head south towards Union Ave toward Yorktown Ave 100ft r+rurn right onto Union Ave 250ft rrurn right onto Huntington Beach City Hall 250ft firurn left onto Yorktown Ave Q.3mi r Turn right onto Goldenwest st 4. 7mi ~ Use the right lane to take 1-405 N ramp 0.3 ~ Merge onto 1-405 N 14mi fi l<eep left to stay on 1-405 N 14ml ~Take exit 36 for Main St 0.3ml ~Turn left onto Figueroa St 0.7ml rrurn right onto W Del Ame;> Blvd Q.3 rrurn right 100ft ~Turn left 150ft CareOnSite 20300c S Vermont Ave, Torrace CA 90502 112 Program Steps Huntington Beach Field Civic Center Lease Civic Center 3 API # 04-059-02422 • Mobilize rig and all equipment to Civic Center 3. • Move in rig up hoist, mud pu111p, 2.5 power swivel, storage tank, catch tank, pipe trailer, & BOPE. • Monitor atn1osphere for H2S, gases, and all other hazards. Monitor tubing and casing pressures. (Report to Company Representative). NOTE: According to lease operator, all 3 wells have less than 20 psi. • Install rod BOPE and function test (Report to Company Representative). Rig up rod equipment and lay down rod assembly on a trailer, so we 111ay haul the rods off and properly dispose of. • Nipple up 8" 900 series BOPE (blow out prevention equip1nent) with accumulator and function test BOPE per Cal GEM' s require1nents. NOTE: CalGEM to witness. • Pull out of hole with original production string. All tubing will be laid onto a pipe trailer and hauled off. • Run in hole with 4-3/4" drill bit, four 3-1 /8" drill collar, and 2-7 /8" 6.5# N-80 eue tubing and clean out to top of 2-7 /8" inner liner@ 22034 'Roseaa[e J{tgfiway, 'Bafi.ersfie{tf, C.Jl. 93314 Plione: 661,589,5338 :fax: 661.589.1089 113 2345'. NOTE: Inner liner must come out before cementing the holes fron1 2345' to 2304' due to possibility of not being able to recover/fish inner liner. • Run in hole with 4-11/16" overshot, four 3-1/8" drill collars, 3- 1/8" hydraulic jars, energizer, and 2-7 /8" 6.5# N-80 eue tubing to top of 2-7 /8" inner liner @ 2345 '. Engage onto 2-7 /8" inner liner and work free. Pull out of hole with 2-7 /8" inner liner and lay down 306' of2-7/8" tubing (10 joints) (Report to Company Representative). • Run in hole with 4-3/4" drill bit, four 3-1/8" drill collar, and 2-7 /8" 6.5# N-80 eue tubing and clean out to top of2-3/8" fish@ 3654'. • Run in hole with 4-11 /16" overshot, four 3-1 /8" drill collars, 3- 1/8" hydraulic jars, energizer, and 2-7 /8" 6.5# N-80 eue tubing to top of 2-3/8" fish@ 3654'. Engage onto 2-3/8" fish and work free. Pull out of hole with 2-3/8" fish and lay down 346' of 2-3/8" tubing ( 11 joints) (Report to C01npany Representative). • Run in hole with 4-3/4" drill bit and 2-7 /8" 6.5# N-80 eue tubing and clean out to 4094'. NOTE: CalGEM to witness. • Rig up wireline and install 2M lubricator (function test). Fill hole with water. Log (CBL) cased hole fron1 cleanout depth to surface (Report to Company Representative). • Run in hole with 2-7 /8" 6.5# N-80 eue open ended tubing to 4094' and rig up ce111ent equipment. Pun1p class G cement fro111 4094' to 3494' in two 300' stages. NOTE: Cal GEM to witness. • Run in hole with 2-7 /8" tubing and tag top of cement plug@ 3494' (CalGEM to witness). Rig up cement equipn1ent and pump class G 22034 1{osecfa(e .'J{tgfiway, 13afiersf'ie(c[, C'A 93314 Plione: 661..589,5338 :fax: 661.589.1089 114 cen1ent from 3494' to 2894' in two 300' stages. NOTE: CalGEM to witness. • Run in hole with 2-7 /8" tubing and tag top of ce1nent plug@ 2894' (Cal GEM to witness). Rig up cement equip1nent and pump class G cen1ent from 2894' to 2399' in two 247.5' stages. NOTE: CalGEM to witness. • Run in hole with 2-7 /8" tubing and tag top of ce1nent plug@ 2399' (CalGEM to witness). Pressure test casing to 500 psi. Rig up cement equipment and pump class G cen1ent fron1 2399' to 1799' in two 300' stages. NOTE: CalGEM to witness. • Run in hole with 2-7 /8" tubing and tag top of cen1ent plug@ 1799' (CalGEM to witness). Rig up cen1ent equipment and pmnp class G cement from 1799' to 1315' in two 242' stages. NOTE: CalGEM to witness. • Run in hole with 2-7/8" tubing and tag top of cen1ent plug@ 1315' (Cal GEM to witness). Pump 46 barrels of 73# 26 shear abandonn1ent 1nud. Abandon1nent n1ud will be placed fro1n 1315' to 150' from surface. NOTE: CalGEM to witness. • Rig up wireline and install wireline 2M lubricator (function test). Perforate 4 half inch holes per foot fron1150' to 145', 20 total shots. (Report to Company Representative). • Run in hole with 2-7 /8" tubing to 150'. Rig up cement equipment and pu1np class G ce1nent fron1 150' to surface (inside and outside of casing'. NOTE: CalGEM and Huntington Beach Fire Department to witness. • Nipple down 8" 900 series BOPE and sectire well. Rig down hoist and rig out all equipment. 22034 1wseaa(e J-figfi:wa.y, 13afi.ersfie{c[, C.'A 93314 Plione: 661,589,5338 ]"ax: 661.589.1089 115 • Witness ce111ent at surface, perforn1 leak test(?), cut casing between 5' and 1 0' from surface grade, tac weld metal top plate onto casing with required inforn1ation, install vent cone and co111plete surface restoration (restore job sit). NOTE: CalGEM and Huntington Beach Fire Department to witness. "Job Co1nplete" 22034 'RoseaaCe J{igliwa.y, 'Bali.ersfie{c{, C.'A 93314 11/ione: 661.589,5338 J'ax: 661,589.1089 116 Location Layout Civic Center 3 -04-059-02422 Excalibur's Best Practice is Right in / Right out when arriving and departing location. (Safe Meeting areas and Entrances may change due to well, site, and safety considerations) 117 Proposed Equipment Layout Civic Center 3 -04-059-02422 118 Haul Route Excalibur Well Service Satellite Yard to Civic Center 3 t Head west toward S Main St SQ ft rrurn right onto main st Q.2mi rrurn right onto E Sepulveda Blvd 1.2ml ~Turn left onto S WIimington Ave 1.4 r Turn right onto the 1-405 S ramp 0.2 1' Merge onto 1-405 S (24 miles) ~ l<eep left at the fork to stay on 1-405 S 2.9 ~ Take exit 18 for 8olsa Ave toward r.nlrl,:,mw::i<:t <an 1 mi ~ l<eep right to stay on Exit 18 follow signs for Bolsa Ave Golden West College Q.2 mi ~Turn left onto Westminster Mall 350ft '4rurn right onto Goldentwest St 4.6 ~ Turn left onto Yorktown Ave 0.4ml rrurn right onto Huntington Beach City Hall 50h Huntington Beach Civic Center 2000 Main St Huntington Beach, Ca. 119 Emergency Route Civic Center 3 to nearest Hospital (2.2 mile) t Exit location head north on Huntington Beach City Hall towards Yorktown Ave 50ft ~ Turn left onto Yorktown Ave 300ft rTurn right onto Main St 1.3mi ~ Turn left onto Beach Blvd 0.7mi rrurn right Ronald Dr 150ft ~ Turn right 150ft ~ Turn left 400ft ~Turn left 200ft r Turn right 150ft Huntington 8each Hospital -H8 Hospital 17772 Beach Blvd, Huntington Beach, Ca. 92647 120 Route for First Aid Civic Center 1 to CareOnSite (25 miles) t Exit location head north on towards Huntington Beach City Hall towards Yorktown Ave 50ft ~Turn left onto Yorktown Ave Q.3mi r Turn right onto Goldenwest st 4. 7ml ~ Use the right lane to take 1-405 N ramp 0.3 ~ Merge onto 1-405 N 14ml ~ l<eep left to stay on 1-405 N 14mi ~Take exit 36 for Main St 0.3mi ~Turn left onto Figueroa St 0.7ml rTurn right onto W Del Amo Blvd 0.3 rrurn right 100ft ~Turn left 150ft CareOnSite 20300c S Vermont Ave, Torrace CA 90502 121 EXHIBIT "B" Payment Schedule (Hourly Payment) A. Hourly Rate CONSULT ANT'S fees for such services shall be based upon the following hourly rate and cost schedule: SEE ATTACHED EXHIBIT B B. Travel Charges for time during travel are not reimbursable. C. Billing 1. All billing shall be done monthly in fifteen (15) minute increments and matched to an appropriate breakdown of the time that was taken to perform that work and who performed it. 2. Each month's bill should include a total to date. That total should provide, at a glance, the total fees and costs incurred to date for the project. 3. A copy of memoranda, letters, reports, calculations and other documentation prepared by CONSULT ANT may be required to be submitted to CITY to demonstrate progress toward completion of tasks. In the event CITY rejects or has comments on any such product, CITY shall identify specific requirements for satisfactory completion. 4. CONSUL TANT shall submit to CITY an invoice for each monthly payment due. Such invoice shall: A) B) C) D) E) completed. Reference this Agreement; Describe the services performed; Show the total amount of the payment due; Include a certification by a principal member of CONSULTANT's firm that the work has been performed in accordance with the provisions of this Agreement; and For all payments include an estimate of the percentage of work Upon submission of any such invoice, if CITY is satisfied that CONSULT ANT is making satisfactory progress toward completion of tasks in accordance with this Agreement, CITY shall approve the invoice, in which event payment shall be made within thirty (30) days of receipt of the invoice by CITY. Such approval shall not be unreasonably withheld. If CITY does not approve an invoice, CITY shall notify CONSULT ANT in writing of the reasons for non-approval and the schedule of performance set 23-13 803/324318 12 122 forth in Exhibit "A" may at the option of CITY be suspended until the parties agree that past performance by CONSULT ANT is in, or has been brought into compliance, or until this Agreement has expired or is terminated as provided herein. 5. Any billings for extra work or additional services authorized in advance and in writing by CITY shall be invoiced separately to CITY. Such invoice shall contain all of the information required above, and in addition shall list the hours expended and hourly rate charged for such time. Such invoices shall be approved by CITY if the work performed is in accordance with the extra work or additional services requested, and if CITY is satisfied that the statement of hours worked and costs incurred is accurate. Such approval shall not be unreasonably withheld. Any dispute between the parties concerning payment of such an invoice shall be treated as separate and apart from the ongoing performance of the remainder of this Agreement. 23-13803/324318 13 123 EXHIBIT B Civic Center 1 -API 04-059-02421 Estimated Rig Days to Complete Abandonment: 17 ---- (Include all taxes, surcharges, chargebacks to be added to 3rd party invoices) (Bidders may use their own form, but it must be as detailed / more detailed than this form) Service Rig and Crew.( specify staffing) 1 Operator & 2 hands Rig Safety Anchors Power Swivel El0PE (specify equipment) 6" 900 series M1,1d Pump · Bottom Hole ASsembly (spetity equip) 61/8 bit, 4 ':!,/4 bit, 4-4 3/4 drill <;ollars pac;kage casing spear, bumper sub, jars & energizers, scraper, travel time and service and for 2 dayi Mobilization Fee Diesel for ·equipment Work Strl ng Inspection Work String Rental (specify equipment) 2 7 /8 N 80 tubing Packers (specific sizes to be used) 7" 20#-23# bridge plug to install new well head Surface Equipment ·(specify) Private Fencing ADanoonment Muo / working mud Trash Container Cement Bond Log Perforating Job City Water Cement Bulk Truck Cement Pump Truck Cement (detail cement and additives) Class G Cement Tank Rentals/ storage tank & catch tank Vacuum Trucks Mud/ Fluid Disposal ( end of job) Cellar/ Pad Removal / Site Restoration Mum1rnscrai:1ve LOSt:; only on Excalibur invoices Site Security Porta Potty Rental Rig Supervision Rig Crew Per Diem Cement Supervision Cement Crew Per Diem Rig Stanaoy ChargeS'"'""rrmeng,suuw, .. ~..,ay-...... Totals Unit l)nit Cost Hour $999 $699.00 Job N/A M1mthly . $5,000.00 Monthly $8,200.00 Monthly $10,000.00 Job Lump Sum Monthly $9,750.00 Job $8,000.00 Gallon $9.00 per gallon Per Foot N/A Per Foot / Day $0.30 Job $9,500.00 Month $2,500.00 Elarrel $23.00 Monthly N/A job $10,000.00 1ob $10,000.00 Gallon $0.18 Hour $170.00 Hour $590.00 Cl/bic Foot $17.00 Monthly $1,000.00 Hour $232.00 Barrel $23.00 Job $35,871.00 Job 6% Monthly $3,800.00 Monthly $200.00 Day/ Shift $1,200.00 Day/ l;mployee $600.00 Day/ Shift $1,200.00 Day/ Employee $600.00 (detail) 4 hrs a day at $699 BEST AND FINAL IN UPDATED DOCUMENT Units Estimated Cost 500 138 $96,462.00 N/A N/A 1 $5,000.00 1 $8,200.00 1 . $10,000.00 1 1 $9,750.00 1 $8,000.00 138 $1,242.00 N/A N/A 34,000 $10,200.00 1 $9,500.00 1 $2,500.00 265 $6,095.00 N/A N/A 1 $10,000.00 1 $10,000.00 16,800 $3,024.00 55 $9,350.00 35 $20,650.00 507 $8,619.00 1 $1,000.00 100 $23,200.00 544 $12,512.00 1 $35,871.00 $173,678.00 $10,420.00 1 $3,800.00 1 $200.00 17 $20,400.00 17 $10,200.00 7 $8,400.00 7 $4,200.00 .00 $358,795.00 124 Civic Center 2 -API 04-059-02447 Estimated Rig Days to Complete Abandonment: _1_6 __ (Include all taxes, surcharges, chargebacks to be added to 3rd party invoices) (Bidders may use their own form, but it must be as detailed / more detailed than this form) Service Rig and Crew (specify staffing) Rig Safety Anchors Power Swivel BOPE (specify equipment) 10" 900 Series Mud Pump Bottom Hole Assembly (specify equip) 6 1/8 bit, 4 3/4 bit & 4-4 3/4 drill collar package Mobilization Fee/ move rig to next location Diesel for equipment Work String Inspection Work String Rental (specify equipment) 2 7 /8 N80 Tubing Packers (specific sizes to be used) Surface Equipment (specify) Private Fencing Abandonment Mud / Wor1dng Mud Trash Container Cement Bond Log Perforating Job City Water Cement Bulk Truck Cement Pump Truck Cement (detail cement and additives) Class G Cement Tank Rentals /Storge&catchtank Vacuum Trucks Mud/ Fluid Disposal (end of job) Cellar/ Pad Removal / Site Restoration l-\umm1strat1ve l.-OSt / Only on Excalibur Invoices Site Security Porta Potty Rental Rig Supervision Rig Crew Per Diem Cement Supervision Cement Crew Per Diem Riq Standbv Charoesfanlyifthe nglsdownmonday-friday Totals Unit Unit Cost Hour $699.00 Job N/A Monthly $5,000.00 Monthly $8,200.00 Monthly $10,000.00 Job $5,160.00 Job $5,000.00 Gallon $9.00 Per Foot N/A Per Foot / Day $0.30 Job N/A Month $2,500.00 6arrel $23.00 Monthly N/A Job $10,00.00 Job $30,000.00 Gallon $0.18 Hour $170.00 Hour $590.00 Cubic Foot $17.00 Monthly $1,000.00 Hour $232.00 Barrel $23.00 Job $38,896.00 Job 6% Monthly $3,800.00 Monthly $200.00 Day/ Shift $1,200.00 Day/ Employee $600.00 Oay / Shift $1,200.00 Day/ Employee $600.00 (detail) 4 hrs a day at BEST AND FINAL IN UPDATED DOCUMENT $6( Units Estimated Cost 126 $88,074.00 N/A N/A 1 $5,000.00 1 $8,200.00 1 $10,000.00 1 $5,160.00 1 $5,000.00 126 $1,134.00 N/A N/A 30,000 $9,000.00 N/A N/A 1 $2,500.00 572 $13,156.00 N/A N/A 1 $10,000.00 1 $30,000.00 16,800 $3,024.00 75 $12,750.00 40 $23,600.00 1,387 $23,579.00 1 $1,000.00 90 $20,880.00 924 $21,252.00 1 $38,896.00 $191,647.00 $11,498.00 1 $3,800.00 1 $200.00 16 $19,200.00 16 $9,600.00 7 $8,400.00 7 $4,200.00 9.00 $389,103.00 125 Civic Center 3 -API 04-059-02422 Estimated Rig Days to Complete Abandonment:_1_6 __ (Include all taxes, surcharges, chargebacks to be added to 3rd party invoices) (Bidders may use their own form, but it must be as detailed / more detailed than this form) Service Rig and Crew (specify staffing) Rig Safety Anchors Power Swivel BOPE (specify equipment) 6" 900 Series Mud Pump Bottom Hole Assembly (specify equip) 4 3/4" bit, 4-3 1/8" Drill Collar package 4 11/16" overshot, bumper sub, jars & energizers, impression block, 4 3/4" concave mill & service man Mobilization Fee/ Back to yard Diesel for equipment Work String Inspection Work String Rental (specify equipment) Packers (specific sizes to be used) Surface Equipment (specify) Private Fencing Abandonment Mud/ Working Mud Trash Container Cement Bond Log Perforating Job City Water Cement Bulk Truck Cement Pump Truck Cement (detail cement and additives) Class G Cement Tank Rentals Vacuum Trucks Mud/ Fluid Disposal (end of job) <;:ellar / Pad Removal / Site Restoration Administrative Cost/ Only on Excalibur Invoices Site Security Porta Potty Rental Rig Supervision Rig Crew Per Diem Cement Supervision Cement Crew Per Diem Ria Standbv Charaes/Only~therigisdownmonday-friday Totals Unit Unit Cost Hour $699.00 Job N/A Monthly $5,000.00 Monthly $8,200.00 Monthly $10,000.00 Job $20,227.00 Job $10,000.00 Gallon $9.00 Per Foot $1.30 Per Foot / Day $0.30 Job N/A Month $2,500.00 Sarrel $23.00 Monthly N/A Job ~10,000.00 Jcib $10,000.00 Gallon $0.18 Hour $170.00 Hour $590.00 Cubic Foot $17.00 Monthly N/A Hour $232.00 Ba·rrel $23.00 Job $38,896.00 Job 6% Monthly $3,800.00 Monthly $200.00 Day/ Shift $1,200.00 Day/ Employee $600.00 Day/ Shift $1,200.00 Day/ Employee $600.00 (detail) 4 hrs a day@ $699.C J BEST AND FINAL IN UPDATED DOCUMENT Units Estimated Cost 128 $89,472.00 N/A N/A 1 $5,000.00 1 $8,200.00 1 $10,000.00 1 $20,227.00 1 $10,000.00 128 $1,152.00 4094 $5,322.00 32087 $9,626.00 N/A N/A 1 $2,500.00 261 $6,003.00 N/A N/A 1 $10,000.00 1 ~10,000.00 16,800 $3,024.00 45 $7,650.00 30 $17,700.00 535 $9,095.00 N/A N/A 90 $20,880.00 490 $11,270.00 1 $38,896.00 $204,252.20 $12,255.00 1 $3,800.00 1 $200.00 16 $19,200.00 16 $9,600.00 6 $7,200.00 6 $3,600.00 $351,872.00 126 ACORD 9 CERTIFICATE OF LIABILITY INSURANCE I DATE (MM/DD/YYYY) ~ 2/20/2024 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the pollcy(ies) must have ADDITIONAL INSURED provisions or be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lleu of such endorsement(s). PRODUCER N~ME~CT INDower Global Insurance Services LLC INRower Global Insurance Services, LLC I r2Nio ~-"· 949-600-7995 I Fffc Nol: 949-600-7998 999 Cor~orate Drive, Suite 100 Ladera anch, CA 92694 INSURERISI AFFORDING COVERAGE NAIC# www.lNpowerGlobal.com CA DOI License No. 6003712 INSURER A : Starr lndemnitv & Liabilitv ComDanv 38318 INSURED INSURER B : Starr Surolus Lines Insurance ComDanv 13604 Excalibur Well Services, Inc. INSURER c : Certain Underwriters at Llovd's London 11150 22034 Rosedale Hr,r. Bakersfield CA 933 4 INSURER D : Starr lndemnitv & Liabilitv ComDanv 38318 INSURER E : Arch SDecialtv Insurance ComDanv 21199 INSURER F : AXIS SurDlus Insurance ComDanv 26620 COVERAGES CERTIFICATE NUMBER: 78700527 REVISION NUMBER: THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CL-\IMS. INSR TYPE OF INSURANCE ADDL SUBR ,:3'LJ%~, ,~3'~%~, LIMITS LTR OUGft .. ftOft POLICY NUMBER A LL COMMERCIAL GENERAL LIABILITY ✓ ✓ 1000090757241 1/31/2024 1/31/2025 EACH OCCURRENCE $1000000 ,..._ ~ CLAIMS-MADE [2] OCCUR ~~~~~~J'i'E~~';'..ncel $1000000 J_ Incl. S&A Pollution Liabilir£ MED EXP (Any one oerson) $5 000 ,..._ PERSONAL & ADV INJURY $1000000 GEN'L AGGREGATE LIMIT APPLIES PER: GENERAL AGGREGATE $2,000,000 Fl POLICY□ frBr □ LOC PRODUCTS -COMP/OP AGG $2 000 000 OTHER: $ B AUTOMOBILE LIABILITY 1000679533241 ~ 1/31/2024 1/31/2025 ~~~~~~tf INGLE LIMIT s1 ooo ooo J_ ANY AUTO BODILY INJURY (Per person) $ OWNED -SCHEDULED BODILY INJURY (Per accident) $ -AUTOS ONLY ,..._ AUTOS J_ HIRED J_ NON-OWNED 1p~~:~~RAMAGE $ AUTOS ONLY AUTOS ONLY $ A UMBRELLA LIAB 14occuR ✓ ✓ 1000095605241 1/31/2024 1/31/2025 EACH OCCURRENCE $25 000 000 -E ✓ EXCESS LIAB CLAIMS-MADE UXP1051292-01 1/31/2024 1/31/2025 AGGREGATE $25 000 000 F OED I I RETENTION$ P-001-001087 432-02 1/31/2024 1/31/2025 $ D WORKERS COMPENSATION ✓ 100 0005402 6/15/2023 6/15/2024 ✓ I ~f:Turi= I I OTH• AND EMPLOYERS' LIABILITY ER Y/N ANYPROPRIETOR/PARTNER/EXECUTIVE □ N/A E.L. EACH ACCIDENT $ 1000000 OFFICER/MEMBEREXCLUDED? (Mandatory In NH) E.L. DISEASE -EA EMPLOYEE $1 nnn nnn gii~~jtfi1J~ ~~~PERATIONS below E.L. DISEASE • POLICY LIMIT $1000000 C Equipment Leased From Others JHBEB23000185070 1/31/2024 1/31/2025 Any One Item/Occurrence $750,000 DESCRIPTION OF OPERATIONS/ LOCATIONS /VEHICLES (ACORD 101, Addltlonal Remarks Schedule, may be attached if more space la required) Certificate holder is included as additional insured with waiver of subrogation as per attached forms CG2010, CG2037, CG2001, SICA-1063, CG2404, and SICA-1020, but only if required by written contract with the named insured prior to an occurrence and subject to all policy terms and conditions. Umbrella is excess over the Commercial Auto, General Liability, and Employers Liability coverage. Waiver of Subrogation also applies to the workers compensation policy per the attached form WC040306. CERTIFICATE HOLDER CANCELLATION City of Huntington Beach SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN Attn: Fire Chief ACCORDANCE WITH THE POLICY PROVISIONS. 2000 Main Street Huntington Beach CA 92648 AUTHORIZED REPRESENTATIVE B l)A)C J· y, ;i~ I Bart J. Le Fevre/KSK © 1988-2015 ACORD CORPORATION. All rights reserved. ACORD 25 (2016/03) The ACORD name and logo are registered marks of ACORD 78700527 I 00000056 I EXCALIBUR 24-25 GL/AL/XS/Equip I Sally Huynh I 2/20/2024 10:53:56 AM (PST) I Page l of ll This certificate cancels and supersedes ALL previously issued certificates. 127 COMMERCIAL AUTO SICA-1063 09 22 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. LESSOR -ADDITIONAL INSURED AND LOSS PAYEE -BLANKET AMENDATORYENDORSEMENT Policy Number: 1000679533241 Effective Date: 0113112024 Named Insured: Excalibur Well Services, Inc. This endorsement modifies the insurance coverage form(s) listed below that have been purchased by you and evidenced as such on the Declarations page. Please read the endorsement and respective policy(ies) carefully. BUSINESS AUTO COVERAGE FORM MOTOR CARRIER COVERAGE FORM AUTO DEALERS COVERAGE FORM SCHEDULE Additional Insured (Lessor): All lessor(s) for whom coverage is required by written contract or agreement A. Coverage 1. Any "leased auto" will be considered a covered "auto" you own and not a covered "auto" you hire or borrow. 2. For any "leased auto," the Who Is An Insured provision under Covered Autos Liability Coverage is changed to include as an "insured" the lessor named in the Schedule. However, the lessor is an "insured" only for "bodily injury" or "property damage" resulting from the acts or omissions by: a. You; b. Any of your "employees" or agents; or c. Any person, except the lessor or any "employee" or agent of the lessor, operating a "leased auto" with the permission of any of the above. 3. The coverage provided under this endorsement applies to any "leased auto" until the expiration date of the applicable written contract or agreement when the lessor or his or her agent takes possession of the "leased auto," whichever occurs first. B. Loss Payable Clause 1. We will pay, as interest may appear, you and the lessor described in this endorsement for "loss" to a "leased auto." 2. The insurance covers the interest of the lessor unless the "loss" results from fraudulent acts or omissions on your part. 3. If we make any payment to the lessor and the lessor has rights to recover damages from another, those rights are transferred to us. The lessor must do everything necessary to secure our rights and must do nothing after "loss" to impair them. C. Notice of Cancellation 1. If we cancel the Policy, we will mail notice to the lessor in accordance with the Cancellation Common Policy Condition. 2. If you cancel the Policy, we will mail notice to the lessor. SICA-1063 09 22 Copyright© Starr Indemnity & Liability Company. All rights reserved. Includes copyrighted material of Insurance Services Office, Inc., with its permission. 78700527 I 00000056 I EXCALIBUR 24-25 GL/AL/XS/Equip I Sally Huynh I 2/20/2024 10, 53, 56 AM (PST) I Page 2 of 11 This certificate cancels and supersedes ALL previously issued certificates. Page 1 of 2 128 D. Additional Definition "Leased auto" means an "auto" leased or rented to you, including any substitute, replacement or extra "auto" needed to meet seasonal or other needs, under a leasing or rental agreement that requires you to provide direct primary insurance for the lessor. All other terms and conditions of this Policy remain unchanged. SICA-1063 09 22 Copyright© Starr Indemnity & Liability Company. All rights reserved. Includes copyrighted material of Insurance Services Office, Inc., with its permission. 78700527 I 00000056 I EXCALIBUR 24-25 GL/AL/XS/Equip I Sally Huynh I 2/20/2024 10,53,56 AM (PST) I Page J of ll This certificate cancels and supersedes ALL previously issued certificates. Page 2 of 2 129 COMMERCIAL AUTO SICA-1020 (0919) THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. WAIVER OF TRANSFER OF RIGHTS OF RECOVERY AGAINST OTHERS TO US (BLANKET WAIVER OF SUBROGATION) AMENDATORYENDORSEMENT Policy Number: 1000679533241 Effective Date: 01/31/2024 Named Insured: Excalibur Well Services, Inc. This endorsement modifies the insurance coverage form(s) listed below that have been purchased by you and evidenced as such on the Declarations page. Please read the endorsement and respective policy(ies) carefully. AUTO DEALERS COVERAGE FORM BUSINESS AUTO COVERAGE FORM MOTOR CARRIER COVERAGE FORM A. It is hereby agree that SECTION IV -BUSINESS AUTO CONDITIONS, A. Loss Conditions, 5. Transfer Of Rights Of Recovery Against Others To Us of the Business Auto Coverage Form, and SECTION V-MOTOR CARRIER CONDITIONS, A. Loss Conditions, 5. Transfer Of Rights Of Recovery Against Others To Us of the Motor Carrier Coverage Form are deleted in their entirety and replaced with the following: If any person or organization to or for whom we make payment under this Coverage Form has rights to recover damages from another, those rights are transferred to us. That person or organization must do everything necessary to secure our rights and must do nothing after "accident" or "loss" to impair them. However, we waive any right of recovery we may have against any person or organization to the extent required of you by a written contract executed prior to any "accident" or "loss", provided that the "accident" or "loss" arises out of the operations contemplated by such contract. The waiver applies only to the person or organization designated in such contract. B. It is hereby agreed that SECTION IV -CONDITIONS, A. Loss Conditions, 5. Transfer Of Rights Of Recovery Against Others To us of the Auto Dealers Coverage Form is deleted in its entirety and replaced by the following: • If any person or organization to or for whom we make payment under this Coverage Form has rights to recover damages from another, those rights are transferred to us. That person or organization must do everything necessary to secure our rights and must do nothing after "accident" or "loss" to impair them. However, we waive any right of recovery we may have against any person or organization to the extent required of you by a written contract executed prior to any "accident" or "loss", provided that the "accident" or "loss" arises out of the operations contemplated by such contract. The waiver applies only to the person or organization designated in such contract. This condition does not apply to damages under Paragraph C. Locations And Operations Medical Payments Coverage of Section II -General Liability Coverages. All other terms and conditions of this Policy remain unchanged. SICA-1020 (0919) Copyright© Starr Indemnity & Liability Company. All rights reserved. Includes copyrighted material of Insurance Services Office, Inc., with its permission. 78700527 I 00000056 I EXCALIBUR 24-25 GL/AL/XS/Equip I Sally Huynh I 2/20/2024 10:53 :56 AM (PST) I Page 4 of 11 This certificate cancels and supersedes ALL previously issued certificates. Page 1 of 1 130 COMMERCIAL AUTO SICA-1020 (0919) However, we waive any right of recovery we may have against any person or organization to the extent required of you by a written contract executed prior to any "accident" or "loss", provided that the "accident" or "loss" arises out of the operations contemplated by such contract. The waiver applies only to the person or organization designated in such contract. This condition does not apply to damages under Paragraph C. Locations And Operations Medical Payments Coverage of Section II -General Liability Coverages. All other terms and conditions of this Policy remain unchanged. SICA-1020 (0919) Copyright© Starr Indemnity & Liability Company. All rights reserved. Includes copyrighted material of Insurance Services Office, Inc., with its permission. 78700527 I 00000056 I EXCALIBUR 24-25 GL/AL/XS/Equip I Sally Huynh I 2/20/2024 10:53 :56 AM (PST) I Page 5 of 11 This certificate cancels and supersedes ALL previously issued certificates. Page 1 of 1 131 POLICY NUMBER: 1ooooeo1s1241 COMMERCIAL GENERAL LIABILITY CG 240405 09 WAIVER OF TRANSFER OF RIGHTS OF RECOVERY AGAINST OTHERS TO US This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE PART SCHEDULE Name Of Person Or Organization: Any person or organization to whom you become obligated to waive your rights of recovery against, under any contract or agreement you enter into prior to the occurrence of loss. Information reauired to comolete this Schedule, if not shown above will be shown in the Declarations. The following is added to Paragraph 8. Transfer Of Rights Of Recovery Against Others To Us of Section IV -Conditions: We waive any right of recovery we may have against the person or organization shown in the Schedule above because of payments we make for injury or damage arising out of your ongoing operations or "your work" done under a contract with that person or organization and included in the "products-completed operations hazard". This waiver applies only to the person or organization shown in the Schedule above. CG 24 0405 09 © Insurance Services Office, Inc., 2008 78700527 I 00000056 I EXCALIBUR 24-25 GL/AL/XS/Equip I Sally Huynh I 2/20/2024 10:53:56 AM (PST) I Page 6 of ll This certificate cancels and supersedes ALL previously issued certificates. Page 1 of 1 132 POLICY NUMBER: 1000090757241 COMMERCIAL GENERAL LIABILITY CG 20 01 0413 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. PRIMARY AND NONCONTRIBUTORY- OTHER INSURANCE CONDITION This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE PART The following is added to the Other Insurance Condition and supersedes any provision to the contrary: Primary And Noncontributory Insurance This insurance is primary to and will not seek contribution from any other insurance available to an additional insured under your policy provided that: (2) You have agreed in writing in a contract or agreement that this insurance would be primary and would not seek contribution from any other insurance available to the additional insured. (1) The additional insured is a Named Insured under such other insurance; and CG 20 01 0413 © Insurance Services Office, Inc., 2012 78700527 I 00000056 I EXCALIBUR 24-25 GL/AL/XS/Equip I Sally Huynh I 2/20/2024 10: 53: 56 AM (PST) I Page 7 of 11 This certificate cancels and supersedes ALL previously issued certificates. Page 1 of 1 133 WAIVER OF OUR RIGHT TO RECOVER FROM OTHERS ENDORSEMENT· CALIFORNIA We have the right to recover our payments from anyone liable for an injury covered by this policy. We will not enforce our right against the person or organization named in the Schedule. (This ~meement applles only to the extent that you perform work under a written contract that requires you to obtain this agreement from us.) You must maintain payroll records accurately segregating the remuneration of your employees while engaged in the work described in the Schedule. The additional premium for this endorsement shal be 2% of the caroomia workers• compensation premium otherwise due on such remuneration. Schedule Additional premium Is a percent of the California Manual Workers Compensation premium. Subject to a minimum premium charge of$ 250 per policy Person or Organization Where required by contract or written agreement prior to loss and allowed by law. Issued by 100 0005402 For attachment to Polley No. I d to Excalibur Well Services, Inc. ssue WC040306 Ed: 04/1984 Job Descrn;>tion Effective Data 06/15/2023 Prarnfl!m $ 78700527 I 00000056 I EXCALIBUR 24-25 GL/AL/XS/Equip I Sally Huynh I 2/20/2024 10:53:56 AM (PST) I Page 8 of 11 This certificate cancels and supersedes ALL previously issued certificates. Page 1 of 1 134 POLICY NUMBER: 1000090757241 COMMERCIAL GENERAL LIABILITY CG 20 10 0413 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED -OWNERS, LESSEES OR CONTRACTORS -SCHEDULED PERSON OR ORGANIZATION This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART SCHEDULE Name Of Additional Insured Person(s) Or Oraanization(s) Location(s) Of Covered Operations City of Huntington Beach, its officers, elected As Required By Written Contract, Fully or appointed officials, employees, agents and Executed Prior To The Named lnsured's volunteers Work Attn: Fire Chief 2000 Main Street Huntington Beach, CA 92648 Information reauired to comolete this Schedule, if not shown above, will be shown in the Declarations. A. Section II -Who Is An Insured is amended to include as an additional insured the person(s) or organization(s) shown in the Schedule, but only with respect to liability for "bodily injury", "property damage" or "personal and advertising injury" caused, in whole or in part, by: 1. Your acts or omissions; or 2. The acts or omissions of those acting on your behalf; in the performance of your ongoing operations for the additional insured(s) at the location(s) designated above. However: 1. The insurance afforded to such additional insured only applies to the extent permitted by law; and 2. If coverage provided to the additional insured is required by a contract or agreement, the insurance afforded to such additional insured will not be broader than that which you are required by the contract or agreement to provide for such additional insured. B. With respect to the insurance afforded to these additional insureds, the following additional exclusions apply: This insurance does not apply to "bodily injury" or "property damage" occurring after: 1. All work, including materials, parts or equipment furnished in connection with such work, on the project (other than service, maintenance or repairs) to be performed by or on behalf of the additional insured(s) at the location of the covered operations has been completed; or 2. That portion of "your work" out of which the injury or damage arises has been put to its intended use by any person or organization other than another contractor or subcontractor engaged in performing operations for a principal as a part of the same project. CG 2010 0413 © Insurance Services Office, Inc., 2012 Page 1 of 2 78700527 I 00000056 I EXCALIBUR 24-25 GL/AL/XS/Equip I Sally Huynh I 2/20/2024 10:53:56 AM (PST) I Page 9 of ll This certificate cancels and supersedes ALL previously issued certificates. 135 C. With respect to the insurance afforded to these additional insureds, the following is added to Section Ill -Limits Of Insurance: If coverage provided to the additional insured is required by a contract or agreement, the most we will pay on behalf of the additional insured is the amount of insurance: 1. Required by the contract or agreement; or 2. Available under the applicable Limits of Insurance shown in the Declarations; whichever is less. This endorsement shall not increase the applicable Limits of Insurance shown in the Declarations. Page 2 of2 © Insurance Services Office, Inc., 2012 CG 20 10 0413 78700527 I 00000056 I EXCALIBUR 24-25 GL/AL/XS/Equip I Sally Huynh I 2/20/2024 10: 53: 56 AM (PST) I Page 10 of 11 This certificate cancels and supersedes ALL previously issued certificates. 136 POLICY NUMBER: 1000090757241 COMMERCIAL GENERAL LIABILITY CG 20 37 0413 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED -OWNERS, LESSEES OR CONTRACTORS-COMPLETED OPERATIONS This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE PART SCHEDULE Name Of Additional Insured Person(s) Or Oraanization(s) Location And Description Of Completed Operations City of Huntington Beach, its officers, elected or As Required By Written Contract, Fully Executed Prior appointed officials, employees, agents and volunteers To The Named lnsured's Work Attn: Fire Chief 2000 Main Street Huntington Beach, CA 92648 Information required to complete this Schedule, if not shown above, will be shown in the Declarations. A. Section II ... Who Is An Insured is amended to include as an additional insured the person(s) or organization(s) shown in the Schedule, but only with respect to liability for "bodily injury" or "property damage" caused, in whole or in part, by "your work" at the location designated and described in the Schedule of this endorsement performed for that additional insured and included in the "products-completed operations hazard". However: 1. The insurance afforded to such additional insured only applies to the extent permitted by law; and 2. If coverage provided to the additional insured is required by a contract or agreement, the insurance afforded to such additional insured will not be broader than that which you are required by the contract or agreement to provide for such additional insured. B. With respect to the insurance afforded to these additional insureds, the following is added to Section Ill -Limits Of Insurance: If coverage provided to the additional insured is required by a contract or agreement, the most we will pay on behalf of the additional insured is the amount of insurance: 1. Required by the contract or agreement; or 2. Available under the applicable Limits of Insurance shown in the Declarations; whichever is less. This endorsement shall not increase the applicable Limits of Insurance shown in the Declarations. CG 20 37 0413 © Insurance Services Office, Inc., 2012 Page 1 of 1 78700527 I 00000056 I EXCALIBUR 24-25 GL/AL/XS/Equip I Sally Huynh I 2/20/2024 10: 53: 56 AM (PST) I Page 11 of 11 This certificate cancels and supersedes ALL previously issued certificates. 137 AMENDMENT NO. I TO SERVICE AGREEMENT BETWEEN THE CITY OF HUNTINGTON BEACH AND EXCALIBUR WELL SERVICES, CORP. FOR CIVIC CENTER WELL ABANDONMENT THIS AMENDMENT is made and entered into by and between the CITY OF HUNTINGTON BEACH, a California municipal corporation, hereinafter referred to as "City," and EXCALIBUR WELL SERVICES, CORP, hereinafter referred to as "Contractor." WHEREAS, City and Contractor are parties to that certain agreement, dated February 20, 2024, entitled "Service Agreement Between the City of Huntington Beach and Excalibur Well Services, Corp. for Civic Center Well Abandonment" which agreement shall hereinafter be referred to as the "Original Agreement"; and City and Contractor wish to amend the Original Agreement to increase the amount of compensation to be paid to Contractor, NOW, THEREFORE, it is agreed by City and Contractor as follows: I. ADDITIONAL COMPENSATION In consideration of the services to be performed under the Original Agreement, City agrees to pay Contractor at the rates specified in Exhibit B which is attached hereto and incorporated by reference into this Agreement. City further agrees to pay Contractor an additional sum not to exceed One Million One Hundred Fifty Thousand Dollars ($1,150,000.00). The additional sum shall be added to the original sum of One Million Ninety-Nine Thousand Seven Hundred Seventy Dollars ($1,099,770.00), for a new contract amount not to exceed Two Million Two Hundred Forty-Nine Thousand Seven Hundred Seventy Dollars ($2,249,770.00). 24-15368/354241 138 2. REAFFIRMATION Except as specifically modified herein, all other terms and conditions for the Original Agreement shall remain in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by and through their authorized officers on ();~q I~-, , 2024 . EXCALIBUR WELL SERVICES, CORP By:_.,_~~-~,__,=---~-1----- e,.., 0 print name --- ITS: (circle one) Chnirmm ident ice President AND z:.c2_ By: ~avdSt,t1 prinl name ITS: (circle onir~~Chi ef Financial Officer/Asst. Sec reia ry -Trcns urc r COUNTERPART 24 -15368/354241 CITY OF HUNTINGTON BEACH, a municipal corporation of th e State of California Mayor City Clerk INITIATED AND APPROVED : Fire Chief -A-PP_R_O_V_E_D_A_S_T_O-FO-RM--: ----~ City Attorney 2 139 2. REAFFIRMATION Except as specifically modified herein, all other terms and conditions for the Original Agreement shall remain in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by and through their authorized officers on ~-j <;:"1" , 2024. EXCALIBUR WELL SERVICES, CORP By: _____________ _ print name ITS: (circle one) Chairman/President/Vice President AND By: _____________ _ print name ITS: (circle one) Secretary/Chief Financial Officer/ Asst. Secretary -Treasurer COUNTERPART 24-15368/354241 CITY OF HUNTINGTON BEACH, a ·poration of the State of City Clerk\ Jo/C?J/.;u,~ INITIATED AND AP~= e-~ ..... ---=------ Fire Chief 2 140 CERTIFICATE OF LtABILITY INSURANCE D/\Ti.(Ml,I/DOIVYV¥) 8/H/2024 THIS CERTIFICATE IS ISSUED ASA MATTER OFilNFORMAJ'ION ONLYANDCONFERSNO RIGHTS UPON THECERl'IFICATEHQLDEit THIS CERT!.FIGATE DOES NOT AFFIRMATIVELY: OR NEGATIVELY' AMEND1 .EXT!=fltD QR Al.TERTflE (j()IIERA~li A~FORPEP 8~ TtiE POLICH;$. BELOWi THISi CERTIFICATE, OF INSU~I\ICE QO~S f1il;)T COl'J,S'l'.ITUTE A CONTRAC'I; BETWEEII!, THE ISSUINQ INSURE~{~), AUTHORIZED REPRESENTATIVE OR PRODUCER, ANO.THECERTlflCATEifOLDER, N/\lCft# 38318 1150 38318 COVER:A.GES CERTIFICATE NUMBER: 88448574' REVISION NUMBER{ 10001379533241 A · _ UMBIU!i.t.Al.tile 1~ QCCU_R / / { / . &XC&SS LWI O --1 CLAIMS.MADE ,1000095605241 uxr1~s1~s2--0:1 p:001,,oq1007432,~2 ✓ al!!> I ✓lRereNJ1oi-isNIL WORi<ens·coMPlifilSATIDN• ANi> f!MPLOVl!Rll'. tlABlLllY y / N AN'lPRCiPRl!iTOAiP/\RTNEMiXECUtiVI! □.-. NI-.. •OFl'ICERIMl:til8&REXClUDED? --. " (t;landiilorylii.NH) Krs&~rfr:1~ ~1~.,e~Ai'toNs tiiikiw. -C Equlpmentli.eased,From Others ;/ 1000005402 JHBEB2300018507Q GENEIW.AGGREGAiE $2;000;0QI) 11a112024 11.ac112025 !iri"!\!1':i~,f•NoLiiuM,r Haooooo 1• .,,e""9,;,011:""v'"1""NJ""uR_v..,.·~,-•-11""a,.,.,.son"""··'1,-· t-$.;..:.c=i=::...._ __ , 1/31/2024 1131/2025 1/31/2Q24 1/31/2025 · 11:Jt/2024 1/31/2025 113t/2024 1/3112025 8QD!LY l!4JIJRY'{!'01t,o:ldanl} -~ . .~OCCURRE"IC\1. s25000'.O00 .AGGRl!GATE $25000000, oeselitPTION OP CiPERAllONS / i;QCAllONS /111:HICllEi; (li,CORD·101, Addition•! R9m~•~• ll<il)lidlilo, i'nily,ti,11IIRl>tll lf mor, ipacltlfi:oqyJro~) ¢.-ettlflcat~.ho. Jd·e-r.ls.: 111.ei·u· d~--J•s-ad-dlll<>o-al 1011-ured v:,,l-lltw···a-·ivet.of-su···bro· · -ga. 1,-·on·a-S:J>-ei'-all.-achedform .. s-CG. 201. :O, CG2-037l CG-.~. 0.0.1; ~IC~'-1. 06·3·,-•-cG.· 2 04, : .. an .. d-SI. C/'1102-o •. ·.I). u-tonlY.lf -reg. o. lte· -d .. by. w~lll. en<:an)lactwlJh th·Ei·•· .. named lns· 11· r1d-11. rl. <>.r-(Q. ,an.•.: ---rrern:-e:a. nd. suliJecttoall:J)olf!lY-.ti.irms. and con,dillo !!• Um.brella. ls l3lle~ss <1ver Iha Commercial Allio, General llablllty, and EmplQyers li.lelilllly co , ·-. APPROVED AS TQ FORM . Wawer i>f SUbrog1,1tlon:also app.lles tQ: tile W1>rl<el'$" c:qmplln'1alion pollc:y. perthe,aUa«:lted'(grrn . CJ40306, . -·· r·· --· CERTIFICATE liOLDER .. City .. o(H-un. ijn·g-.ton Beac;h Attn. Fire, Chief: 2000 Main st.reet . . . . . . . . Huritinglon Beach CA 92648 i ACORD 25 (2016/03) Rtt• MtcHAEL it aArss v CANCELLATION .... ,.,_ ................. ·.,.,-,,...!"'! !"'"\' .... ~,.-,•. $HOUI.O ANY, QFTHEABOV&IJESCRIBEltPOUClES BE C-ANCEl.1.ED•BeFORE THE.·. !<XPIR,\llQN DATE lttSRl;OF; .NOTICE. WILi. . BE OELlVf:REli /114 ACCQllDANC:E WITH TH.Ii 1"01,.ICY f>RQYJSIQN~ •. ~'1-988-201~ ACORD•CORPORATION. All rights reser:ved. The ACORD name and lo~o arai'eglstered marks of ACORD 246 141 POI.JCY NUMBER: 1880090151241 COMMERCIAL$ENER'AL l.l:ABILITY CG20100413 THIS: ENDORSEMENT CHANGES THE,POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED -OWNERS; LESSEES OR CONTRACTORS -SCHE.DlJLED PE.RSON OR. ORGANIZATION Thi$ endorsement modifies rnsurarice provided 1,1nder the,fQll<>Wlng: COMMERCIAL GENERALLIA131l.lTY COVERAGE PART SCHEDULE Name OfA<Jd(tlonal ln$4red Persoo(s), Or Orgai'!izationlsl · City flt .Httntil'lg:tQ~ ~~achtits officetts1 el~eted:; '· ar apr;,aintt!!d t!>fficial~, e~t:e,~es. aget:'lts ano . .wtunfeers:. . . Attn: Fire Chief 2000 Main Street Huntington Beach, CA 92648 Locationlsl Of Covered' <>ileratlons As Required By Written. Contracl,.Fully Executed Prior To The Named lnsured's Work Information required to complete this ScheclUle if notshown above, will be shown lnthe Oec::tarat1011s; A. Section II -Who Is An Insured · is ·amended' fo Include as a11.t=.1ddlUonal insured the person(s) or organlzatlon(s) shown. In the SqhedtJle, . but ()nly wlt!'l respect to liabUlly for ''bddlly inj"'ry'\ ''property damage'' or "personal . an(! advertising Injury!' caused, In whole. or In paf'ti by: 1. Your acts or omissions; or 2, The, acts or omfsslcms of those acting on your behalf;. In the perlorrnanee of your ongoing operations for the adqltlonal lnsured(s) ~t the locallon(s) designated above. However-: 1. The insurance afforded to such additional Insured only· applies to the extent permitted by law;and 2. If coverage ptovldeq t<> the 1:1dditional i11sµred)~ required · by a contract or agreement, the in~l:irance affordecf to such aclditlonai .lnsurec.l w(II. not be broader than that which you: are required by the contract or agreement to Ptovlde for such a<lditional Insured; s .. With .respect to the· Insurance •afforded to these adc;llUqnal l,osuredsi the following additional exclusloos E!ppiy~ · This 'insurance doe$ not apply to. ''bodlfy lnjuryHor "properly damag¢" oc:c:urring :affer: 1. Ali work, including matertais, parts or equipment fuml$bed in con,wctfon wlth a1.1c:fl work, on the project (other than .service, maiht1:1m;3nce or repairs} to be performed l;>y or on ~~half qf the ai;li;lltional in$ui'Eld(s) at the location, of the covered operations has been c:ompJeted~ .or 2, That portion of i•your work; out of which the JnJuiY or damage arises has been pu.t to· its intended use by any . pe~on or organl:zaUon otber than .another contractor or subcontractor t;1ngaged .lh pe;:fqrrnihg operatic>ns for a principal as,apartofthe same,proJect~. CG 2010 041~ @ lnsuranc.e $ervipEla Office, Inc., 2012 Page 1 of 2 247 142 C. With respect to the insurance afforded to these additional insureds, the following Is added to Section Ill -Limits Of Insurance; If coverage provided to the additional insured Is required by a contract or agreement, the most we will pay on behalf of the additional Insured Is the amount of insurance: 1. Required by the contract or agreement; or 2. Available under the applicable Limits of Insurance shown In the Declarations; whichever Is less. This endorsement shall not increase the applicable Limits of Insurance shown in the Declarations. Page 2 of 2 © Insurance Services Office, Inc., 2012 CG 2010 0413 8044857• I 00000056 I BXCALIBU& M-25 <lL/AL/XS/~\Jip I Sally Huynh I 6/11/2024 1,57;27 p,: (PDT) I Page 10 of ll This certificate cancels and suporsedos ALL previously issued certificates. 248 143 COMMERCIAL GE!NEF?AL LIABILltY CG20 370413 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ ITCAREFULLY~ ADDITIONAL INSURED -OWNERS1 LESSEES OR CONTRACTORS --COMPLETED OPERATIONS This endorsement modifies Insurance provided:under thefollowlng: COMMERCIAL <3ENERAL LIABILITY COVERAGE' PART PRODUCTS/COMPlEJEO OPE:RATIONS LIAB.lllTY COVE~AGE PART SCHEDULE Name; Of.A,ddftlonal lnsure.d Person(s) . . . . . . ... . . . .. . OrOrctanizatlon(s) Location And trescrlDtlon Of Comoleted ODeratfons tl!li~~f-:lll~il'.lg~ntij~imfl;iifsoffi¢~ts,.ele~te~bt" Aa RequlredByJNrlttenContract, Fully Executed Prior appoint(:)£1; 01fl~alsternplb~es1.as;ei!lts ,ai11t¥dlunteers; · : To 'fhe: Named lnsur~d's Work Attn: fir~'Chief · '2000 Main Street Hvntlngton Beach, CA 92~48 lnformatlon required ~. complete this Schedule,• 1r not:shown above, will be shQwn hl the Declarations: \ A. $ectlon U -Wh~, hrAn ln1;ured rs iamended to lnQlude as an additional Insured the pe~oo{s) or organlzatlon(s) shown In the Sehedule. but only with respe9t lo liability · for "bqdily lnju!y!' or ''property damage" caused, ft:1 whole or In parti by "your work" at the location. designated and aescribec1 In the Schedul~. 9f this endorsement performed for that additional. insured .and irtcllldect In the "proaucts-rompleted operations hazard'\ How.ever: 1. The Insurance afforded . to such addltlonal lns.ured only applies to the extent permitted by,law;and 2 •.. If coverage proylded to thie addltl9hal 1.nsured Is required .bya contract: or .agreement. the Insurance afforded to such addltfonal Insured will not. be broadrar th13n that which you are requit~ci bY the 9c,mtract or agreement to provide for such additional insured. a; With ·respect to .the insurance afforded to these additional insureds, the following · Is aade(;I to Section Ill-Limits, Oftnsurance: . If coverage f)ro>tlded to the additional Insured t.s requlred by a contra~ or agreement, the most' we will pay Oil behalf Of the Eiddltlonal lrisured is the am.cunt oflnsur~nce: 1. Required by the contract or agreement; or 2. Available under. the applicable Limits of Insurance• shown In the Declarations; whichever Is (esS'. Tlilsendorsement:shall .not Increase. theapplicable Limits oflnsurance: shown, tn the Declarations. CG 20 37 0413 @ hw1,1rance Services Qffice,. lnc.i 20.12 Page1 of1 249 144 COMMl:RCIAL GENERAL LIABII.ITY CG 20 01 0413' THIS ENOQRSEMENT CHAN.GE$ THE f>Ol..,ICY. PLEA$E READJT CARi:FULLY. PRU\IIARY AND NONCONTRIBUTORY - . OTHER.INSURANc:e CONDITION. This endor~eme.nt. modifies insurance provided· under the following: COMMERCIAL~ENERAL LIABILITY .COVERAGE PART PRODUCTS/COMPLETEDOPERATIONSLIABILITY COVERAGE•PARt· the foUt>Wlng is c:1ddec:t tq: the OthJr lnt5uranc~ Go11dition ar1c:t superi.edes c:1ny provision (o the contrary:. · rtrit'ria.ry~n,i fl':qncontr!b,ut~rtlnsJ!l~~, . 'Jhls;J~~Ut<ll1Clf: i' Ptlfll~~JE ~ll~?•o/~! ~ ~(tek .l:Qtitdbt1tf()n;fr~m, anY' C11:thero:1nsura~ee. availc:1ble, .•.• (2) Yot1, have agreed In writing irta contract or agreement th~ this ,insU~Me w<>tild .. be primary and would not seek contribution from any other in$llrartce. available to the additfonial. insl.itett to. ·an addltlona1· 1nsured under your policy provided thet: (1 l The additional Insured ls a Named Insured under.such ott.i~r lristJrance; artd CG 2001 0413 @ Insurance Services Office, Inc., 2012 250 145 WAIVER OF OUR RIGHT TO RECOVER FROM OTHERS ENDORSl:MENT • CALIFORNIA We have the right to recover our payments from anyone liable for an Injury <:Qvered by Utls pollcy. We will not enforce our right against the person or organization named in the Schedule. (This agreement applies only to the extent that you perform work under a written contract that requires you to obtain this agreement from us.) You must maintain payroll records accurately segregating the remuneration of your employees while engaged In the work described In the Schedule. · The additional premium for this endorsement shall be 2% of the California wort<ers' compensation premium otherwise due on such remuneration. schedule Additional premium Is a percent of the California Manual Workers Compensation premium. Subject to a minimum premium charge of$ 250 per policy Person or OrqanizaUon Where required by contract or written agreement prior to loss and allowed by law. Job Descripttm, Issued by 1000005402 For attachment to Polley No. Issued lo Excalibur Well Services, Inc. WC04 03 06 Ed:04/1984 Effective Oate 06/15/2024 80H85'14 I oooooos• I >:.~CALIBUR 24·25 GL/AL/XS/Equip I Sally Huynh I 6/11/2024 1:57:27 PH (POT) I PAge 8 of 11 This certificate cancels and supersedes ALL prevjouely issued certificates. Premium$ Page 1 of 1 251 146 COMMERCIAL AUTO SICA-1063 09 22 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. LESSOR-ADDITIONAL INSURED AND LOSS PAYEE -BLANKET AMENDATORY ENDORSEMENT Polley Number: 1000679533241 Effective Date: 01/31/2024 Named Insured: Excalibur Well Services, Inc. This endorsement modifies the insurance coverage form(s) listed below that have been purchased by you and evidenced as such on the Declarations page. Please read the endorsement and respective pollcy(ies) carefully. BUSINESS AUTO COVERAGE FORM MOTOR CARRIER COVERAGE FORM AUTO DEALERS COVERAGE FORM Additional Insured (Lessor): A. Coverage SCHEDULE All lessor(s) for whom coverage is required by written . contract or agreement 1. Any "leased auto" will be considered a covered "auto" you own and not a covered "auto" you hire or borrow. 2, For any "leased auto," the Who Is An Insured provision under Covered Autos Liability Coverage is changed to include as an "insured" the lessor named in the Schedule. However, the lessor ls an "insured" only for "bodily injury" or "property damage" resulting from the acts or omissions by: a. You; b. Any of your "employees" or agents; or c. Any person, except the lessor or any "employee" or agent of the lessor, operating a "leased auto" with the permission of any of the above. 3. The coverage provided under this endorsement applies to any "leased auto" until the expiration date of the applicable written contract or agreement when the lessor or his or her agent takes possession of the "leased auto," whichever occurs first. B. Loss Payable Clause 1. We will pay, as Interest may appear, you and the lessor described in this endorsement for "loss" to a "leased auto." 2. The insurance covers the interest of the lessor unless the "loss" results from fraudulent acts or omissions on your part. 3. If we make any payment to the lessor and the lessor has rights lo recover damages from another, those rights are transferred to us. The lessor must do everything necessary to secure our rights and must do nothing after "loss" to impair them. c. Notice of Cancellation 1. If we cancel the Policy, we will mail notice to the lessor in accordance with lhe Cancellation Common Policy Condition. 2. If you cancel the Policy, we will mail notice to the lessor. SICA-1063 09 22 Copyright© Starr Indemnity & Llabillly Company. All rights reserved. Includes copyrighted material of Insurance Services Office, Inc., with its permission. 804•18514 I 00000056 I EXCALIBUR 24•25 GL/AL/XS/Equit> I Sally Kuynh I 6/11/20>4 1157127 PM l~O'r) I Pogo i of 11 This certificate cancels and supersedes ALL previously issued certificates, Page 1 of2 252 147 D. Additional Definition "Leased auto" means an "auto" leased or rented to you, including any substitute, replacement or extra "auto• needed to meet seasonal or other needs, under a leasing or rental agreement that requires you to provide direct primary insurance for the lessor. All other terms and conditions of this Policy remain unchanged. Copyright@ Starr Indemnity & Llablllly Company. All rights reserved. Includes copyrighted material of Insurance Services Office, Inc., with lls permission. 80448574 I 00000056 I JXCALISUR 14•J& OL/A!./XS/Equi9 I Sally Huynh I 6/11/20?.4 I :S'J:27 PH C~DT) I Page J of ll Thia certificate cancels and supersedes ALL previously issued certi£icates. Page 2 of2 253 148 COMMERCIAL AUTO SICA-1020 (0919) THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. WAIVER OF TRANSFER OF RIGHTS OF RECOVERY AGAINST OTHERS TO US (BLANKET WAIVER OF SUBROGATION) AMENDATORYENDORSEMENT Polley Number: 1000679533241 Effective Date: 0113112024 Named Insured: Excalibur Well Services, Inc. This endorsement modifies the insurance coverage form(s) listed below that have been purchased by you and evidenced as such on the Declarations page. Please read the endorsement and respective policy(ies) carefully. AUTO DEALERS COVERAGE FORM BUSINESS AUTO COVERAGE FORM MOTOR CARRIER COVERAGE FORM A. It is hereby agree that SECTION IV -BUSINESS AUTO CONDITIONS, A. Loss Conditions, 5. Transfer Of Rights Of Recovery Against Others To Us of the Business Auto Coverage Form, and SECTION V -MOTOR CARRIER CONDITIONS, A. Loss Conditions, 5, Transfer Of Rights Of Recovery Against Others To Us of the Motor Carrier Coverage Form are deleted in their entirety and replaced with the following: If any person or organization to or for whom we make payment under this Coverage Form has rights to recover damages from another, those rights are transferred to us. That person or organization must do everything necessary to secure our rights and must do nothing after "accident" or "loss" to Impair them. However, we waive any right of recovery we may have against any person or organization to the extent required of you by a written contract executed prior to any "accident" or "loss", provided that the ''accident" or "loss" arises out of the operations contemplated by such contract. The waiver applies only to the person or organization designated in such contract. B. It is hereby agreed that SECTION IV -CONDITIONS, A. Loss Conditions, 5. Transfer Of Rights Of Recovery Against Others To us of the Auto Dealers Coverage Form is deleted In its entirely and replaced by the following: • Ir any person or organization to or for whom we make payment under this Coverage Form has rights to recover damages from another, those rights are transferred to us. That person or organization must do everything necessary to secure our rights and must do nothing after "accident" or "loss" to Impair them. However, we waive any right of recovery we may have against any person or organization to the extent required of you by a written contract executed prior lo any "accident" or "loss", provided that the "accident" or "loss" arises out of the operations contemplated by such contract. The waiver applies only to the person or organization designated in such contract. This condition does not apply to damages under Paragraph C. Locations And Operations Medical Payments Coverage of Section II -General Liability Coverages. All other terms and conditions of this Policy remain unchanged. SICA-1020 (0919) Copyright@ Starr Indemnity & Liability Company. All rights reserved. Page 1 of 1 Includes copyrighted material of Insurance Services Office, Inc., with its permission. 80•48571 I OOOOOOSG I sxcru.rnu~ 2•1-25 OL/IIL/XS/Equlp I Sally ~uynh I 6/U/202~ 1 ,57 ,n PK (Pll'fl I P•g• • of !l This certificate cancels and supersedes i\LL previously issued ce1·tificatas, 254 149 COMMERCIAL AUTO SICA-1020 (0919) However, we waive any right of recovery we may have against any person or organization to the extent required of you by a written contract executed prior to any "accident" or "loss", provided that the "accident" or "loss" arises out of the operations contemplated by such contract. The waiver applies only lo the person or organization designated in such contract. This condition does not apply to damages under Paragraph C. Locations And Operations Medical Payments Coverage of Section 11-General Liability Coverages. Ail other terms and conditions or this Policy remain unchanged. SICA-1020 (0919) Copyright© Starr Indemnity & Liability Company. All rights reserved. Includes copyrighted material of Insurance Services Office, Inc., with its permission. 80448574 I 000000~6 I SXCALISU!t 24·25 GL/AL/XS/~quip I Sally Kuynh I G/11/202< 1:57127 PII (POT} I Page 5 of II This certificate cancels and supersedes ALL previously issued certificates. Page 1 of 1 255 150 POLICY NUMBER: 1000090757241 COMMERCIAL GENERAL LIABILITY CG 24 04 05 09 WAIVER OF TRANSFER OF RIGHTS OF RECOVERY AGAINST OTHERS TO US This endorsement modifies Insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE PART SCHEDULE Name Of Person Or Organization: Any person or organization to whom you become obligated to waive your rights of recovery against, under any contract or agreement you enter into prior to the occurrence of loss. Information required to complete this Schedule if not shown above will be shown In the Declarations. The following is added to Paragraph 8. Transfer Of Rights Of Recovery Against Others To Us of Section IV -Conditions: We waive any right of recovery we may have against the person or organization shown in the Schedule above because of payments we make for injury or damage arising out of your ongoing operations or "your work" done under a contract with that person or organization and Included in the "products-completed operations hazard". This waiver applies only to the person or organization shown in the Schedule above. CG 24 04 05 09 © Insurance Services Office, Inc., 2008 80H857~ I oooooos6 I exCALIYUR 2•-2s GL/AL/XS/E<julp I Sally Huynh I 6/11/2024 1,s,,21 PK (l'll'l'I I Pagft 6 oC 11 Thie certificate cancels and supersedes ALL previously issued certificates, Page 1 of 1 256 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:24-918 MEETING DATE:1/21/2025 REQUEST FOR CITY COUNCIL ACTION SUBMITTED TO:Honorable Mayor and City Council Members SUBMITTED BY:Travis Hopkins, Acting City Manager VIA:David Cain, Interim Chief Financial Officer PREPARED BY:Serena Bubenheim, Assistant Chief Financial Officer Subject: Year-End Audit Results for the FY 2023/24 Annual Comprehensive Financial Report (ACFR) and Approval of Fiscal Year 2023/24 Year-End Audit Adjustments Statement of Issue: Fiscal Year 2023/24 Year-End Audit Results The City received an Unmodified (Clean) Audit Opinion for the City’s Fiscal Year (FY) 2023/24 Annual Comprehensive Financial Report (ACFR), which is the highest audit result attainable. In addition, the Government Finance Officers Association awarded their Certificate of Achievement for Excellence in Financial Reporting to the City for the 38 th consecutive year. Included as an attachment is the FY 2023/24 ACFR to receive and file. Fiscal Year 2023/24 Year-End Adjustments As part of the year-end closing process for FY 2023/24, certain budgetary adjustments are needed to reconcile the budget with actual expenditures incurred; to comply with auditing, actuarial, accounting, and legal requirements; and to align with the City Council’s strategic goal of fiscal stability. City Council approval of these reconciliations is requested as part of the close-out of FY 2023/24. Financial Impact: 1. Appropriation and Inter-Fund Transfers (various funds): Appropriation increases and inter-fund transfer authority of $947,504.21 are requested to reconcile the budget with actual expenditures incurred in various funds (Attachment 3). 2. Appropriation increases (various funds): Appropriation increases of $252,137.39 are requested to reconcile the budget with actual expenditures incurred in various funds (Attachment 3). There are sufficient revenues, cash, and/or fund balances to support the above referenced adjustments. City of Huntington Beach Printed on 1/16/2025Page 1 of 3 powered by Legistar™ 151 File #:24-918 MEETING DATE:1/21/2025 Recommended Action: A) Receive and File the FY 2023/24 Annual Comprehensive Financial Report and other auditor- issued reports; and, B) Approve year-end budget adjustments to the FY 2023/24 Revised Budget in the funds and by the amounts contained in Attachment 3. Alternative Action(s): Do not approve, and direct staff accordingly. Analysis: Fiscal Year 2023/24 Year-End Audit Results Auditing firm Davis Farr LLP (Auditors) audited the City’s financial statements and internal control for the FY 2023/24. The City received an Unmodified (Clean) Audit Opinion for the FY 2023/24 Annual Comprehensive Financial Report (ACFR), which is the highest opinion possible (Attachment 1). In addition, the Auditors issued the following reports (Attachment 2): ·AU-C 260 Letter: Auditor’s Communications with Those Charged with Governance ·Air Quality Management District (AQMD) Report ·Appropriations Limit Agreed-Upon Procedures Fiscal Year 2023/24 Year-End Audit Adjustments The FY 2023/24 Budget was adopted by City Council on June 26, 2023, for the fiscal year beginning July 1, 2023. As part of the year-end closing process, certain technical year-end budget adjustments to the FY 2023/24 Revised Budget are requested to align appropriations in certain funds with actual expenditures incurred through June 30, 2024, as actual expenditures cannot exceed the appropriation amounts contained in the Revised Budget. Adjustments are also required to ensure compliance with Generally Accepted Accounting Principles (GAAP), Governmental Accounting Standards Board (GASB), and other regulatory, contractual, or legal requirements. Please note that any appropriation increases are fully offset by commensurate amounts of revenues, available cash, or fund balances in each Fund. Additionally, no adjustments to the General Fund are being requested. Inter-Fund Transfers (Other Funds): Surf City “3” Cable Channel, Infrastructure, and Equipment Replacement Funds (243, 314 and 324): An appropriation of $763,504.21 is requested to increase transfers out from the Surf City “3” Cable Channel Fund (243) into the Infrastructure Fund (314) in the amount of $611,888.68 and into the Equipment Replacement Fund (324) in the amount of $151,615.53. The requested transfer is to reimburse the Infrastructure and Equipment Replacement Funds for its fair share of various fiber and server and other equipment upgrades that supported the City’s Cable Channel. Debt Service Bella Terra and Bella Terra Parking Structure Funds (410 and 711): An appropriation of $184,000 is requested to increase transfers out from the Debt Service Bella Terra City of Huntington Beach Printed on 1/16/2025Page 2 of 3 powered by Legistar™ 152 File #:24-918 MEETING DATE:1/21/2025 Fund (410) into the Bella Terra Parking Structure Fund (711) to cover increased maintenance and operations costs that are paid for from the Bella Terra Parking Structure Fund (711). A corresponding expenditure appropriation is being requested in the Bella Terra Parking Structure Fund (711) to cover the increased maintenance costs. Appropriation Increases (Other Funds): Hotel/Motel Business Improvement District (Hotel/Motel BID) Fund (709): An appropriation increase of $46,673 is requested to align the budget with actual FY 2023/24 revenues and expenditures. The Hotel/Motel BID Fund is a pass-thru fund in which the City collects self-assessed revenues from the participating hotels and motels and submits them to Visit Huntington Beach per the BID’s agreement. Downtown Business Improvement District (Downtown BID) Fund (710): An appropriation increase of $9,011 is requested to align the budget with actual FY 2023/24 revenues and expenditures. All Downtown merchants have a self-assessment through the Business Improvement District (BID) that the City Council approves annually. The City collects the fees and redistributes them back to the District. Bella Terra Parking Structure Fund (711): An appropriation increase of $184,000 is requested to align the budget with actual FY 2023/24 revenues and expenditures. The City collects a maintenance fee from the owners of the center which is used to fund maintenance and operations costs for the structure. Used Oil Grant Fund (960): An appropriation increase of $12,453.39 is requested to align the budget with actual FY 2023/24 revenues and expenditures. A portion of prior year grant funds from the OPP13 term were unspent and needed to be returned to the Department of Resources Recycling and Recovery (CalRecycle). Environmental Status: Not applicable Strategic Plan Goal: Non Applicable - Administrative Item Attachment(s): 1. FY 2023/24 Annual Comprehensive Financial Report (ACFR) 2. Other Auditor Issued Reports 3. Fiscal Year 2023/24 Year-End Budget Adjustments 4. FY 2023/24 ACFR and Year-End Budget Adjustments Presentation City of Huntington Beach Printed on 1/16/2025Page 3 of 3 powered by Legistar™ 153 ANNUALANNUALANNUAL COMPREHENSIVECOMPREHENSIVECOMPREHENSIVE FINANCIALFINANCIALFINANCIAL REPORTREPORTREPORT For Fiscal Year Ended June 30, 2024 154 THIS PAGE INTENTIONALLY LEFT BLANK 155 CITY OF HUNTINGTON BEACH, CALIFORNIA ANNUAL COMPREHENSIVE FINANCIAL REPORT FOR THE YEAR ENDED JUNE 30, 2024 Prepared by the Finance Department 156 THIS PAGE INTENTIONALLY LEFT BLANK 157 INTRODUCTORY SECTION 158 i City of Huntington Beach Annual Comprehensive Financial Report For the Year Ended June 30, 2024 TABLE OF CONTENTS INTRODUCTORY SECTION Table of Contents ........................................................................................................................................ i-ii Letter of Transmittal .................................................................................................................................... iii-x City Officials ................................................................................................................................................ xi Organizational Chart ................................................................................................................................... xii Certificate of Achievement in Excellence in Financial Reporting ................................................................. xiii FINANCIAL SECTION Independent Auditor’s Report...................................................................................................................... 1-4 Management’s Discussion and Analysis (Required Supplementary Information) ....................................... 6-23 Basic Financial Statements: Government-wide Financial Statements: Statement of Net Position .................................................................................................................. 25 Statement of Activities ....................................................................................................................... 26 Fund Financial Statements: Balance Sheet – Governmental Funds .............................................................................................. 27 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position ......... 28 Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds ...... 29 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities ....................................................................... 30 Statement of Net Position – Proprietary Funds .................................................................................. 31 Statement of Revenues, Expenses and Changes in Fund Net Position – Proprietary Funds ............ 32 Statement of Cash Flows – Proprietary Funds ................................................................................... 33 Statement of Fiduciary Fund Net Position – Fiduciary Funds ............................................................ 34 Statement of Changes in Fiduciary Fund Net Position – Fiduciary Funds ......................................... 35 Notes to Financial Statements .............................................................................................................. 36-116 Required Supplemental Information: Notes to Required Supplementary Information .................................................................................. 120 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget And Actual – General Fund ............................................................................................................. 121 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget And Actual – Grants Special Revenue Fund ................................................................................... 122 Schedule of Changes in the Net Pension Liability and Related Ratios .............................................. 123-125 Schedule of Changes in the Net OPEB Liability and Related Ratios ................................................. 126 Schedule of Contributions .................................................................................................................. 127-129 Schedule of Money Market Weighted Rate of Return ........................................................................ 129 Schedule of Contributions for the OPEB Plan .................................................................................... 130 159 ii FINANCIAL SECTION (Continued) Supplementary Information: Combining and Individual Fund Statements and Schedules: Combining Balance Sheet – Other Governmental Funds .................................................................. 133-136 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Other Governmental Funds ............................................................................................................ 137-140 Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual – Other Governmental Funds ........................................................................... 141-149 Statement of Net Position – Internal Service Funds ........................................................................... 151 Statement of Revenues, Expenses, and Changes in Fund Net Position Internal Service Funds .................................................................................................................. 152 Statement of Cash Flows – Internal Service Funds ........................................................................... 153 Combining Statement of Fiduciary Fund Assets and Liabilities.......................................................... 155 Combining Statement of Changes in Fiduciary Net Position .............................................................. 155 STATISTICAL SECTION Net Position by Component – Last Ten Fiscal Years .................................................................................. 157-158 Changes in Net Position – Last Ten Fiscal Years ....................................................................................... 159-160 Fund Balances – Governmental Funds – Last Ten Fiscal Years ................................................................ 161 Changes in Fund Balances – Governmental Funds – Last Ten Fiscal Years ............................................. 163-164 Assessed and Actual Valuation of All Taxable Property (Excluding Redevelopment Agency) - Last Ten Fiscal Years .............................................................................................................................. 165 Property Tax Rates – All Direct and Overlapping Government Tax Rate 04-001 Largest Area in City – Last Ten Fiscal Years ........................................................................................... 165 Property Tax Levies and Collections – Last Ten Fiscal Years .................................................................... 166 Top Ten Property Tax Payers – Current Year and Nine Years Ago ............................................................ 167 Ratios of Outstanding Debt by Type – Last Ten Fiscal Years ..................................................................... 169-170 Legal Debt Margin – Last Ten Fiscal Years ................................................................................................ 171 Statement of Direct and Overlapping Bonded Debt .................................................................................... 172 Principal Private Employers – Current Year and Nine Years Ago ............................................................... 173 Full-Time Actual and Budgeted City Employees by Function/Program– Last Ten Fiscal Years .................. 174 Operating Indicators by Function/Activity – Last Ten Fiscal Years .............................................................. 175-176 Capital Assets Statistics by Function/Activity .............................................................................................. 177 160 iii CITY OF HUNTINGTON BEACH December 19, 2024 Honorable Mayor, City Council and Citizens of the City of Huntington Beach: In accordance with the requirements of the City Charter, and the City of Huntington Beach’s ongoing commitment to transparent financial reporting, I am pleased to present the Annual Comprehensive Financial Report (ACFR) for the year ended June 30, 2024. As required by the City Charter, and to ensure the reliability of the information contained herein, the City of Huntington Beach (the City) contracted with independent auditing firm Davis Farr LLP. The goal of the audit was to provide reasonable assurance that the City’s financial statements are free from material misstatement. In addition, Davis Farr LLP audits the City’s major program expenditures of federal grants for compliance with Title 2 of the United States Code of Federal Regulations Part 200 (Uniform Guidance). The Single Audit Report is published separately from this ACFR and may be obtained upon request from the City’s Finance Department. This report consists of management’s representations concerning the City’s finances. As such, management assumes full responsibility for the completeness and accuracy of the information presented in this document and ensuring it is reported in a manner that fairly presents the financial position and operations of the various funds of the City. To provide a reasonable basis for making these representations, and assurance that the financial statements will be free from material misstatement, management has established a comprehensive internal control framework that is designed to both protect the government’s assets from theft, loss, or misuse and to compile sufficient reliable information for financial statement conformity with Generally Accepted Accounting Principles (GAAP). As the cost of internal controls should not outweigh their benefits, the City’s comprehensive framework of internal controls has been designed to provide reasonable assurance rather than absolute assurance that the financial statements will be free from material misstatement. We are pleased to report that Davis Farr LLP granted the City an unmodified (clean) opinion for the financial statements of the City for the year ended June 30, 2024. The auditor’s opinion can be found in the Financial Section of this report. GAAP requires that management provide a narrative introduction, overview and analysis to accompany the financial statements in the form of a Management Discussion and Analysis (MD&A). This transmittal letter is designed to complement and should be read in conjunction with it. The MD&A can be found immediately following the independent auditor’s report. 161 iv Profile of the City of Huntington Beach The City of Huntington Beach is home to a thriving beach community, located on the Orange County coast, 35 miles south of Los Angeles and 90 miles north of San Diego. With a population of 192,129 residents, it is known as Surf City due to its abundance of beaches; the year-round sunny and warm Mediterranean climate; and its casual lifestyle. With over 10 miles of coastline and iconic pier spanning 1,856 foot in length- the longest pier on the West Coast- Huntington Beach plays host to over 16 million visitors annually. As the fourth largest city in Orange County, and the 23rd largest in California by population, Huntington Beach is recognized as a prime location to live, work and play, ranking #2 in the nation for “Quality of City Services” and #65 for “Best-Run City” in America by WalletHub (June 2024). Huntington Beach was also ranked one of the top ten “Best City for People with Disabilities” by WalletHub (September 2024). The City boasts an annual median household income of $119,885, 34 percent higher than the median household income for the United States, 20 percent higher than the State of California and 5 percent higher than Orange County. Founded in the late 1880s, Huntington Beach was incorporated as a Charter City in 1909. Huntington Beach has a Council/Manager form of government wherein seven City Council members are elected to four-year terms, and the Mayor is filled on a rotating basis from the incumbent Council Members. The City Attorney, City Clerk and City Treasurer positions are also elected and serve four-year terms. The City of Huntington Beach is a full-service city including police, fire, public works, and other key functional departments with a dedicated and talented team of over 1002 full-time employees. In 2011, the unincorporated oceanfront community of Sunset Beach was officially annexed by the City of Huntington Beach. Sunset Beach is a small beachfront community with approximately 1,000 residents and 1.5 square miles of land. Beachfront properties with high property values make this community a valuable addition to the City. Sunset Beach features one of the widest and most pristine beaches in Southern California and is home to the historic Sunset Beach Arts Festival. A thriving beach community, Huntington Beach is home to numerous events, including the Great Pacific Airshow – the only beachfront airshow on the West Coast featuring the U.S. Air Force Thunderbirds, U.S. Navy F-35C Demo Team, Canadian Forces Snowbirds, and many others. This unique airshow, which first premiered in October 2016, has gained tremendous popularity and attracts visitors from all over the world to view the three-day event. The City’s century-old traditional Fourth of July Fireworks Show and Parade, known nationally as “the largest Fourth of July Parade west of the Mississippi,” spans over a five-day period that includes a Main Street Block Party with free live music, carnival rides, and other family-friendly activities, Surf City 5K Run, and spectacular fireworks show overlooking the pier. The City also hosts a variety of other exciting events for families and visitors such as the annual Concours d’Elegance, Civil War Days, International Surfing Association (ISA) World Surfing Games, and other events. In November 2023, the inaugural Darker Waves beachfront music festival featuring New Order, Tears for Fears, the B-52s, and others, performed to a sold-out crowd of 30,000. 162 v Economic Condition and Outlook There are several reasons to reflect on the measures taken over the past couple of years to protect the City’s finances. Through the leadership and support of the City Council, the City implemented significant cost-saving measures, including a Citywide Separation Incentive Program and reorganization plan, refinancing the City’s pension debt, and a proactive Budget Balancing Plan. Looking ahead, economic indicators point to a potential recession. Home sales have resulted in a $3.2 billion increase in assessed property valuations for Fiscal Year 23-24. However, supply chain shortages and inflationary pressures on normal business activities continue to influence economic conditions. Increases in utility rates, such as electricity and gas, contribute to a rise in projected Franchise and Utility Users Tax revenues, which help to balance the overall economic impact. The City of Huntington Beach continues to thrive together through the motto “OneHB,” which reflects the City’s commitment to facing the potential upcoming recession created by inflationary conditions and supply chain shortages guided by the following principles: x To stay committed to being One Team: working together to serve the people of Huntington Beach exceptionally to inspire pride in the community. x Work to have One Focus: to stay fanatical about achieving municipal excellence by being active caretakers of our unique, people-centric HB culture. x Continue to pursue One Goal: to ensure that HB continually improves its standing as a premier coastal community as measured through the health of our people, our organization, our infrastructure, and our community. Property Tax The City of Huntington Beach’s assessed valuations are very strong, reflecting both new development and increased property values. The City’s Fiscal Year 2024/25 assessed property value grew 4.5 percent to $55.5 billion. This solid performance, coupled with steady year-over- year growth, reflects a stable property tax base that can weather steep declines in real estate markets. Over 60 percent of parcels have an assessed valuation (AV) base year prior to 2004, representing a significant amount of untapped AV. For Fiscal Year 2022/23, secured property tax revenue collections totaled $68.5 million. For Fiscal Year 2023/24, secured property taxes totaled $70.6 million, reflecting a 9 percent increase. 163 vi Sales Tax Huntington Beach’s business community is well-diversified with no single industry or business dominating the local economy. Local businesses include aerospace and high technology, petroleum, manufacturing, computer hardware and software, financial and business services, hotel and tourism, automobile services, large-scale retailers, and surf apparel. The City’s diverse sales tax base makes it a stable source of revenue and mitigates the impact of industry- specific downturns as shown below. $36.1 $37.5 $39.4 $41.5 $43.8 $46.1 $47.3 $50.3 $53.1 $55.5 $0.0 $5.0 $10.0 $15.0 $20.0 $25.0 $30.0 $35.0 $40.0 $45.0 $50.0 $55.0 $60.0 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24 2024/25 CityofHuntingtonBeach Total AssessedValuation FiscalYears 2015/16Ͳ 2024/25 (inbillions) Autos and Transportation 20% Building and Construction 7% Business and Industry 9% Fuel and Service Stations 9% General Consumer Goods 18% Restaurants and Hotels 16% State and County Pools 16% Other 5% City of Huntington Beach Composition of Sales Tax Revenue Fiscal Year 2023/24 164 vii *Fiscal Year 2017/18 reflects nine months of data only due to the change in the City’s fiscal year Transient Occupancy Tax (TOT) Transient Occupancy Tax (TOT), a 10 percent tax applied to hotel stays within the City remains strong. The City collected an impressive $17.4M in TOT revenues during FY23/24, reflecting a $81,000, or .5 percent increase, affirming Huntington Beach’s Status as a premier vacation destination. FY 2022/23 includes the first full fiscal year of TOT revenues from the City’s Short- Term Vacation Rental Program totaling $971,000. *Fiscal Year 2017/18 reflects nine months of data only due to the change in the City’s fiscal year. $29.5 $36.1 $40.4 $31.4 $43.9 $41.1 $47.7 $53.4 $52.6 $51.4 $0.0 $5.0 $10.0 $15.0 $20.0 $25.0 $30.0 $35.0 $40.0 $45.0 $50.0 $55.0 2014/15 2015/16 2016/17 2017/18* 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24 (I n Mi l l i o n s ) CityofHuntingtonBeach HistoricalSalesTax Revenue $9.2 $10.0 $11.4 $8.8 $14.0 $9.6 $10.4 $15.8 $17.3 $17.4 $0.0 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 $14.0 $16.0 $18.0 $20.0 2014/15 2015/16 2016/17 2017/18* 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24 (I n Mi l l i o n s ) CityofHuntingtonBeach Transient OccupancyTax Revenue 165 viii Budget Development and Monitoring The budget is prepared under the supervision of the City Manager and transmitted to the City Council for deliberation at least 30 days prior to the end of the fiscal year. Pursuant to the City’s Charter, the City Council must adopt the annual budget by June 30th and may amend or revise it any time at a properly noticed meeting. Budgetary control is at the Department level within each fund and a Department Head, with the Chief Financial Officer’s approval, may transfer funds within like categories (operating and capital expenditures) of the same Department. The transfer of funds for salaries and benefits requires additional approval by the City Manager or his /her designee. Cash Management Policies and Practices Surplus cash is invested by the elected City Treasurer, in investments allowed by the City’s Investment Policy. The Investment Policy is adopted annually by the City Council after approval by the Investment Advisory Board. It outlines guidelines to meet the daily cash flow needs of the City, maximize the efficiency of the City’s cash management system, and identifies prudent investment vehicles for cash balances. The City Treasurer, as required by California Government Code 53601, prepares an annual Statement of Investment Policy which allows the City to meet current obligations while earning a market rate of return. Further information regarding the City’s cash and investments can be found in Note 2 of the financial statements. Long-Term Financial Planning and Major Initiatives The Strategic Goals provides the framework for the goals and objectives of the City. The City Council held a Strategic Planning Workshop on June 8, 2023, establishing eight goals to achieve over the next four years. The 2023-2027 Strategic Plan, approved by City Council, includes the eight Strategic Goals listed below to achieve over the next four years: x Economic Development – greater business retention, investment and job growth in the City. x Fiscal Stability – available funding to support a high-quality level of programs, services and capital investments and to build a structural surplus. x High Performing Organization – an engaged City workforce committed to responsive and exceptional public service for all. x Homelessness – A continuum of care that reduces homelessness and maintains quality of life for the entire community. x Housing – proactive programs to address diverse housing needs within the City’s jurisdiction. x Infrastructure Investment – maintain and upgrade infrastructure that supports the community’s day-to-day needs in accordance with the City’s Infrastructure Report Card. x Public Engagement – a community that has easy access to clear, accurate, and timely City information and expresses increased awareness and involvement in City activities. x Public Safety – Ensure the safety and protection of all community members, both efficiently and effectively. The goals drive both short and long-term budgetary decisions and the daily operations of the City by ensuring everyone is consistently working to achieve the goals outlined in the Strategic Plan. 166 ix “One Stop Shop” The City is continuing the process of implementing a “One Stop Shop” to facilitate the permitting process. The “One Stop Shop” streamlines the permitting process and provides applicants with a comprehensive checklist to complete the necessary steps to obtain permits. The “One Stop Shop” approach aims to make the permitting process more efficient so that businesses and residents experience quicker and easier access to obtain permits for business licenses, short- term rentals, and building permits. Infrastructure Report Card Infrastructure provides essential services and affects quality of life for all Huntington Beach residents; to sustain these critical systems, it is important to routinely assess them. The City is preparing an Infrastructure Report Card (IRC) that will serve as a high-level summary to highlight the current condition of the City’s Infrastructure. This report card will assign grades (A- F) to various infrastructure categories, communicating the status of each and identifying priorities for improvement. The project structure is made up of three separate committees including the Outreach and Communications Committee. The Outreach and Communications Committee is comprised of approximately 100 Huntington Beach residents appointed by the City Council and/or are recognized members of the community who will act as ambassadors of this process through their networks. This will promote resident participation, education, and awareness of the project both during the assessments and after the final report is released. Assessments began in August 2023 and the final report will be presented to City Council early 2025. Awards and Acknowledgements The City of Huntington Beach has once again received the “Certificate of Achievement for Excellence in Financial Reporting” award bestowed by the Government Finance Officers’ Association (GFOA) of the United States and Canada for the 38th consecutive year. Receipt of the award requires government entities to publish transparent, easily readable and efficiently organized Annual Comprehensive Financial Reports, conforming to program, accounting, and legal standards. The Certificate of Achievement earned for the fiscal year ended June 30, 2023, is valid for one year only. The City believes that this Annual Comprehensive Financial Report continues to conform to the Certificate of Achievement Program requirements and will be submitted to the GFOA for its consideration for another award. I wish to thank the City Council, City Manager, and City Departments for their continued diligence in their role as fiscal stewards for the City of Huntington Beach. Without their leadership and support, the favorable financial results contained in this report would not have been possible. I would also like to thank the Finance Commission, a seven-member body appointed by the City Council, which has been instrumental in helping the City maintain its long term goal of financial sustainability. 167 x The preparation of this report would also not have been possible without the professional dedicated staff of the Finance Department. Specifically, I would like to thank Zack Zithisakthanakul, Ian Wuh, Tara Mukund, Ming Zhai, Nicholas Dang, Thuy Vi, and Shari Saraye for their hard work and dedication. Respectfully, David Cain Interim Chief Financial Officer 168 xi City of Huntington Beach City Council Pat Burns, Mayor Casey McKeon, Mayor Pro Tem Don Kennedy, Councilmember Tony Strickland, Councilmember Butch Twining, Councilmember Gracey Van Der Mark, Councilmember Chad Willams, Councilmember Executive Team Travis Hopkins, Acting City Manager Elected Department Heads Alisa Backstrom, City Treasurer Lisa Lane Barnes, City Clerk Michael Gates, City Attorney Department Directors David Cain, Finance Chief Scott Haberle, Fire Chief Eric Parra, Police Chau Vu, Public Works Jennifer Villasenor, Community Development Marissa Sur, Human Resources Ashley Wysocki, Community & Library Services John Dankha, Information Services 169 Building Code Enforcement Economic Development Housing Permit Counter Planning FY 2024 - 25 Assistant City Manager Community Development Finance Homelessness & Behavioral Health Services Communications & HBTV City Council Support Sustainability City Manager City Attorney Advisory Community Prosecution Litigation City Clerk City Council Mayor Mayor Pro-Tempore City Council Members THE PEOPLE OF HUNTINGTON BEACH Elected Offices Appointed Departments Community & Library Services Events & Rentals Library & Cultural Services Program & Services Facilities & Development Accounting Services Budget Management Business License Finance Fire Emergency Response Marine Safety Professional Standards Benefits & Training Labor Relations Recruitment & Selection Risk Management Human Resources Information Services Business Applications Infrastructure Systems Technology Engagement & Support Administrative Operations Investigations Patrol Special Operations Support Services Police Information Services Engineering Maintenance & Operations Transportation Utilities Admin, Public Support, & Elections Records Management City Treasurer Investments Revenue Services Organizational Chart FY 2024 - 25 T HE PEO PLE O F HU NTINGTO N BEACH City Attorneyt City ClerkC C ouncilCity CC City Treasurere Admin, Public Support, & Elections Records Management Investments Revenue Services Advisory Community Prosecution Litigation ayor o-Tempore cil Members Ma Mayor Pro City Counc a o c M anagerCity MM City Manag erAssistant CC Community Development Finance Human Resources Information Services Community & Library Services Fire Police Information Services ouncil port City C Supp Co p nications BTV Commun & HB n BBuilding Code Enforcement Economic Development Housing Permit Counter Planning Benefits & Training Labor Relations Recruitment & Selection Risk Management Administrative Operations Investigations Patrol Special Operations Support Services Business Applications Infrastructure Systems Technology Engagement & Support Events & Rentals Library & Cultural Services Program & Services Facilities & Development Emergency Response Marine Safety Professional Standards Engineering Maintenance & Operations Transportation Utilities Accounting Services Budget Management Business License ssness avioral ervices Homele & Beha Health S e a S Sustainabilityn xii 170 • • f Organ1zat1onal Chart I I I I I I I I I I I • • r---------------------------7--------------~-------------T---------------------------7 I I I I I I I I I I I I I I I I I I I I I I I I r-------,----------,--------r-----------r-----------1--------------------------1 I I I I I I I I I I I I I I I I I I , I : I __ ___.,___ _ __ ...___ I Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting Presented to City of Huntington Beach California For its Annual Comprehensive Financial Report For the Fiscal Year Ended June 30, 2023 Executive Director/CEO xiii 171 • ~ p. ~ FINANCIAL SECTION 172 Independent Auditor’s Report City Council City of Huntington Beach Huntington Beach, California Report on the Audit of the Financial Statements Opinions We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Huntington Beach (City), as of and for the year June 30, 2024, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents. In our opinion, the accompanying financial statements present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Huntington Beach as of June 30, 2024, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinions We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Responsibilities of Management for the Financial Statements The City’s management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter. 1 173 Davis Farr CERTIFIED PUBLIC ACCOUNTANTS Davis Farr LLP 18201 Von Karman Avenue I Suite 1100 I Irvine, CA 92612 Main: 949.474 .2020 I Fax : 949.263.5520 Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with GAAS and Government Auditing Standards, we: Exercise professional judgment and maintain professional skepticism throughout the audit. Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed. Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control–related matters that we identified during the audit. Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, budgetary comparison information and pension and other post employment benefit schedules be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the 2 174 information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Supplementary Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The combining and individual nonmajor fund financial statements are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual nonmajor fund financial statements are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial statements are fairly stated, in all material respects, in relation to the basic financial statements as a whole. Other Information Management is responsible for the other information included in the Annual Comprehensive Financial Report. The other information comprises the introductory section and statistical section but does not include the financial statements and our auditor's report thereon. Our opinions on the financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 23, 2024 on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely 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 effectiveness of internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance. Irvine, California December 23, 2024 3 175 THIS PAGE INTENTIONALLY LEFT BLANK 4 176 THIS PAGE INTENTIONALLY LEFT BLANK 5 177 MANAGEMENT DISCUSSION AND ANALYSIS 6 178 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 As management of the City of Huntington Beach, we offer readers of the City’s financial statements this narrative overview and analysis of the financial activities of the City of Huntington Beach for the year ended June 30, 2024. 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 iii-x of this report. Financial Highlights Below is a summary of the City’s government-wide financial information (in thousands): x The City of Huntington Beach’s total assets and deferred outflows of resources exceeded its liabilities and deferred inflows of resources at the close of the most recent fiscal year by $896,784,000. Total net position increased by $60,725,000 or 7.3 percent primarily as a result of the Department of Finance’s (DOF) decision on Waterfront Loan. The DOF determined the Waterfront loan between the City of Huntington Beach and the former Redevelopment Agency of the City of Huntington Beach to be an enforceable obligation. This created an increase of $31,136,000 in the fiscal year. x Long-term obligations increased by $13,996,000 or 2.4 percent. The increase is primarily the result of GASB 68 adjustments. The adjustment increased net pension liability by $32,693,000 as a result of actuarial valuation adjustment of the City’s current net pension liability. At the same time, long-term obligations due in more than one year decreased by $18,697,000 due to normal debt obligation being paid down. x Deferred outflows of resources decreased by $19,504,000 or 12.6 percent while deferred inflow of resources decreased by $2,240,000 primarily due to the differences between projected and actual earnings on Pension Plan investments used to determine the City’s net pension liability. June 30, 2024 June 30, 2023 Amount Increase (Decrease) Percent Increase (Decrease) Assets 1,461,477$ 1,367,093$ 94,384$ 6.9% Deferred Outflows of Resources 135,090 154,594 (19,504) -12.6% Liabilities 680,915 664,520 16,395 2.5% Deferred Inflows of Resources 18,868 21,108 (2,240) -10.6% Total Net Position 896,784 836,059 60,725 7.3% Unrestricted Net Position (147,955) (136,350) (11,605) -8.5% Long-Term Obligations 604,946 590,950 13,996 2.4% Program Revenues 189,331 212,002 (22,671) -10.7% Taxes 220,940 221,607 (667) -0.3% Other General Revenues 53,534 9,214 44,320 481.0% Expenses 403,080 361,502 41,578 11.5% Total Governmental and Business-Type Activities 7 179 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 x Program revenues decreased by $22,671,000 or 10.7 percent. The decrease is due the City of Huntington Beach receiving one time revenue related to the American Rescue Plan Act grant funding in prior year. The American Rescue Plan Act of 2021 provided funding to individuals, businesses, state, and local governments to help mitigate the impacts of the COVID-19 pandemic. The City of Huntington Beach received $29,607,000 which was used for eligible police and fire expenditures. x Expenses increased by $41,578,000 or 11.5 percent largely due to increases of $18,010,000 and $6,516,000 in Police and Fire expenditures. In Fiscal Year 2023- 2024 the City of Huntington Beach signed a new MOUs with both department which included salary increases. Overview of the Financial Statements This discussion and analysis serves as an introduction to the City of Huntington Beach’s basic financial statements. The City of Huntington Beach’s basic financial statements 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 certain other supplementary information in addition to the basic financial statements. Government-wide Financial Statements The government-wide financial statements are designed to provide readers with a broad overview of the City’s financial condition and are prepared similarly to those in the private sector. The Statement of Net Position presents information on all of the City’s assets, liabilities, deferred outflows and inflows with the difference between them reported as net position. Over time, continued increases or decreases in net position may indicate whether the City’s financial condition is improving or deteriorating. The Statement of Activities presents information on how the City’s net position changed during the most recent fiscal year. These changes are reported on the full accrual basis when the economic event occurs (not when the cash is received or paid). The government-wide financial statements separate functions that are primarily supported by taxes and intergovernmental revenues (governmental activities) from functions that are supported by user fees (business-type activities). Governmental activities include the City Council, City Manager, City Treasurer, City Attorney, City Clerk, Finance, Human Resources, Community Development, Fire, Information Services, Police, Community Services, Library Services, and Public Works departments. Business- type activities include Water, Sewer, Refuse, and Hazmat Services. 8 180 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 The government-wide financial statements include the City and all of its component units that are legally separate but whose activities entirely support the City of Huntington Beach. The government-wide financial statements can be found on pages 25-26 of this report. Fund Financial Statements The City separates financial activities into funds to maintain control over resources that have been legally separated. 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 the same functions reported in governmental activities in the government-wide financial statements. However, the focus in the governmental fund section of these financial statements is on near-term resource inflows and outflows available for spending, as well as balances of resources available for spending at the end of the fiscal year. It is useful to compare information presented for the governmental funds to information presented for governmental activities in the government-wide financial statements. The reconciliations indicate to the reader the differences in financial reporting between the governmental activities section and the governmental funds section. The City maintains 24 individual governmental funds. Information is presented separately in the governmental funds Balance Sheet and in the governmental funds Statement of Revenue, Expenditures, and Changes in Fund Balances for the General Fund, Grants Special Revenue Fund, Low and Moderate Income Housing Asset Fund (LMIHAF), Pension Liability Debt Service Fund, and Infrastructure Fund, all of which are considered to be major funds. Data from the other 19 smaller funds are combined into a single, aggregated presentation. Individual fund data for each of these other governmental funds is provided in combining statements elsewhere in this report. The City provides an annual appropriated budget for its governmental funds. Budgetary comparison schedules for the General Fund and Grants Special Revenue Fund are required to be presented and are included on pages 119-120. Other major governmental funds (LMIHAF Capital Projects Fund, Pension Liability Debt Service Fund and Infrastructure Fund) are presented in the Supplementary Information section on pages 148-149 of this report and demonstrate compliance with the budget. The basic governmental fund financial statements can be found on pages 27 and 29 of this report. 9 181 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 Proprietary Funds The City maintains two different types of proprietary funds, which are used to account for the same activities as the business-type activities in the government-wide financial statements. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its Water, Sewer Service, Refuse, and Hazmat Service activities. Internal Service funds are used in accounting as a device to accumulate and allocate costs internally among the City's various functions. The City uses internal service funds to account for its self-insurance worker’s compensation activities, self-insurance general liability activities, and equipment replacement needs. Because these services predominantly benefit governmental rather than business-type functions, they have been included with governmental activities in the government-wide financial statements. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide information for Water, Sewer Service, Refuse, Hazmat Service, Self-Insurance Workers’ Compensation, Self-Insurance General Liability, and Equipment Replacement Funds. The basic proprietary fund financial statements can be found on pages 31-33 of this report. Fiduciary Funds Fiduciary funds are used to account for resources held for the benefit of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support the City of Huntington Beach’s own programs. The accounting used for fiduciary funds is much like that used for proprietary funds. The basic fiduciary fund financial statements can be found on page 34-35 of this report. 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 37-116 of this report. 10 182 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 Other information In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning the City’s progress in funding its obligation to provide pension and OPEB benefits to its employees and General Fund and major special revenue funds budget-to-actual comparisons. Required supplementary information can be found on pages 120-130 of this report. The combining statements and schedules referred to earlier in connection with other governmental funds is presented immediately following the required supplementary information on pensions. Combining and individual fund statements and schedules can be found on pages 133-149 of this report. Government-wide Financial Analysis As noted earlier, net position may serve, over time, as a useful indicator of a government’s financial position. At the end of the current fiscal year, the City reported positive net position balances for both governmental and business-type activities, with total assets plus deferred outflows exceeding liabilities plus deferred inflows by $896,784,000. Below is a summary schedule of the City’s net position at June 30, 2024 (in thousands): Governmental Activities June 30, 2024 June 30, 2023 Amount Increase (Decrease) Percent Increase (Decrease) Current and Other Assets 429,299$ 360,136$ 69,163$ 19.2% Non-Current Assets 4,653 1,809 2,844 157.2% Capital Assets 791,511 772,038 19,473 2.5% Total Assets 1,225,463 1,133,983 91,480 8.1% Deferred Outflows of Resources 126,835 144,205 (17,370) -12.0% Current and Other Liabilities 61,903 61,970 (67) -0.1% Long-Term Obligations 572,492 559,315 13,177 2.4% Total Liabilities 634,395 621,285 13,110 2.1% Deferred Inflows of Resources 17,935 20,322 (2,387) -11.7% Net Position: Net Investment in Capital Assets 751,578 727,051 24,527 3.4% Restricted 127,535 107,546 19,989 18.6% Unrestricted (179,145) (173,034) (6,111) -3.5% Total Net Position 699,968$ 661,563$ 38,405$ 5.8% Business-Type Activities June 30, 2024 June 30, 2023 Amount Increase (Decrease) Percent Increase (Decrease) Current and Other Assets 94,226$ 91,312$ 2,914$ 3.2% Non-Current Assets 554 215 339 157.7% Capital Assets 141,234 141,583 (349) -0.2% Total Assets 236,014 233,110 2,904 1.2% Deferred Outflows of Resources 8,255 10,389 (2,134) -20.5% Current and Other Liabilities 14,066 11,600 2,466 21.3% Long-Term Obligations 32,454 31,635 819 2.6% Total Liabilities 46,520 43,235 3,285 7.6% Deferred Inflows of Resources 933 786 147 18.7% Net Position: Net Investment in Capital Assets 141,232 141,581 (349) -0.2% Restricted 24,394 21,213 3,181 15.0% Unrestricted 31,190 36,684 (5,494) -15.0% Total Net Position 196,816$ 199,478$ (2,662)$ -1.3% 11 183 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 Analysis of the City’s Net Position Current and Other Assets: The increase in current and other assets of $69,163,000 for governmental activities is mainly due to the DOF determination of the Waterfront Loan being an enforceable obligation. As mentioned above, this decision created an increase of $31,136,000 of receivables. The remaining amount is due to increased property tax, use of money and property and charges for services revenue. The increase in current and other assets of $2,914,000 for business-type activities is primarily due to increased cash and investment balance in the Water Master Plan fund as there was strong economic growth in Fiscal Year 2023/24 as well as increased water rates. Non-current Assets: Non-current Assets increased by $2,844,000 in governmental activities and $339,000 in business-type activities due to GASB 68 adjustments. Current and Other Liabilities: Current and Other Liabilities for governmental activities decreased by $67,000 and increased by $2,466,000 for business-type activities. The increase in business-type activities is due to normal fluctuations in accounts payable and payroll cycles. Deferred Outflows and Inflows of Resources: The decrease in deferred outflows of resources of $17,370,000 and $2,134,000 for governmental activities and business-type activities and decrease of deferred inflows of resources of $2,387,000 for governmental activities and increase of $147,000 for business-type activities is the result of actuarially determined amortization differences between projected and actual earnings on pension plan investments, and differences between expected and actual experience used to determine the Net Pension and Other Postemployment Benefits Liabilities. See Notes 6, 7, and 8 for additional information. Long-Term Obligations: Long-term obligations increased by $13,177,000 for governmental activities and $819,000 for business-type activities primarily due to the GASB 68 adjustments resulted in an increase of net pension liability totaling an increase $32,693,000 at the same time long-term obligations due in more than one year decreased by $18,697,000 due to regular debt obligations being paid. Net Investment in Capital Assets: The largest portion of the City’s net position reflects investment in capital assets (e.g., land, buildings, machinery, equipment, and infrastructure), less any related debt used to acquire those assets that is still outstanding. The City uses capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City’s investment in its capital assets are reported net of related debt, the resources needed to repay this debt must be provided from other sources, since capital assets themselves cannot be used to liquidate these liabilities. Net position invested in capital assets, net of related debt from governmental 12 184 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 activities increased $24,527,000 or 3.4 percent, primarily due to street improvements and construction projects, such as improvements to the Police station, various park improvements, pump station improvements and fiber expansion project throughout the city. Net position invested in capital assets net of related debt from business-type activities decreased $349,000 or 0.2 percent primarily due depreciation expense and a reduction of sewer and lift station improvement costs. Restricted Net Position: An additional portion of the City’s net position is subject to external (legally imposed or statutory) restrictions ($127,535,000 for governmental activities, and $24,394,000 for business-type activities). These amounts represent 18.2 percent and 12.4 percent of net position for governmental activities and business-type activities, respectively. Restricted net position from governmental activities increased $19,989,000 or 18.6 percent, largely due to the increase in restricted net position in the Pension Liability Fund and Other Governmental Funds. The Pension Liability Fund increased due to revenues from the voter-approved property tax override dedicated to the payment of pension costs being set aside as well more increase property tax being collected based on home values going up. Other Governmental Funds saw decrease Highway, Street and Transportation related expenditure which resulted in an increase restricted net position. Unrestricted Net Position: The unrestricted net position (negative $179,145,000 for governmental activities and $31,190,000 for business-type activities) represent negative 25.6 percent and 15.8 percent, respectively, of net position for governmental activities and business-type activities. Unrestricted net position for governmental activities decreased $6,111,000 or 3.5 percent. Unrestricted net position for business-type activities decreased by $5,494,000 or 15.0 percent. These changes can be attributed to changes in Net Pension Liability and Other Postemployment Benefits. 13 185 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 A condensed summary of governmental activities (in thousands) follows: The cost of all governmental activities this year was $322,733,000. However, as shown in the Statement of Activities, the amount that taxpayers ultimately financed for these activities was $206,878,000, as costs of $86,911,000 were paid by those who directly benefited from the programs, or by other governments and organizations that subsidized certain programs with operating grants and contributions of $11,678,000, and capital grants and contributions of $17,266,000. Overall, the City’s governmental program revenues were $115,855,000. The City paid for the remaining “public benefit” portion of Revenues: June 30, 2024 June 30, 2023 Amount Increase (Decrease) Percent Increase (Decrease) Program Revenues: Charges for Current Services 86,911$ 82,704$ 4,207$ 5.1% Operating Grants and Contributions 11,678 43,005 (31,327) -72.8% Capital Grants and Contributions 17,266 11,202 6,064 54.1% Total Program Revenues 115,855 136,911 (21,056) -15.4% General Revenues: Property Taxes 114,630 109,467 5,163 4.7% Sales Taxes 56,003 57,164 (1,161) -2.0% Utility Taxes 23,283 22,558 725 3.2% Franchise Taxes 9,625 15,100 (5,475) -36.3% Transient Occupancy Tax 17,399 17,318 81 0.5% Use of Money and Property (Loss)12,361 5,153 7,208 139.9% From Other Agencies - Unrestricted 5,883 3,225 2,658 82.4% Gain from Elimination of Allowances 31,136 - 31,136 N/A Disposal of Machinery and Equipment (Loss)- (520) 520 N/A Total General Revenues 270,320 229,465 40,855 17.8% Total Revenues 386,175 366,376 19,799 5.4% Expenses: City Council 441 429 12 2.8% City Manager 7,699 5,780 1,919 33.2% City Treasurer 2,124 396 1,728 436.4% City Attorney 4,156 3,248 908 28.0% City Clerk 1,674 1,370 304 22.2% Finance 6,499 6,211 288 4.6% Human Resources 2,786 - 2,786 N/A Community Development 19,124 20,550 (1,426) -6.9% Fire 78,253 71,737 6,516 9.1% Information Services 8,682 8,565 117 1.4% Police 107,440 89,430 18,010 20.1% Community Services 15,176 13,389 1,787 13.3% Library Services 7,409 7,225 184 2.5% Public Works 51,560 49,151 2,409 4.9% Interest on Long-Term Debt 9,710 9,587 123 1.3% Total Expenses 322,733 287,068 35,665 12.4% Change in Net Position Before Transfers 63,442 79,308 Transfers (55) (38) Change in Net Position 63,387 79,270 Net Position - Beginning of Year 636,581 557,311 Net Position - End of Year 699,968$ 636,581$ Governmental Activities 14 186 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 governmental activities with $270,320,000 in taxes and general revenue (some of which may only be used for certain programs) and with other revenues, such as interest and general entitlements. Charges for current services increased $4,207,000, or 5.1 percent. This increase is mainly from reimbursement of liability claim paid out by the City. Other note worth increases in revenue were in Community Services, and Fire. Community Services saw an increase of $2,165,000 due concessionaire, recreational, special events, and facility rental revenues as well as increase in parking fees rates as tourism increased. Fire saw an increase of $6,062,000 due to the City participating in Voluntary Rate Range Intergovernmental Transfer (VRRP IGT) Program. Community Development related program revenue saw a decrease of $7,715,000 which can be attributed to decrease in permit issuance fees collected for development projects as there were no new major development projects for the year. Operating Grants and Contributions decreased by $31,327,000 or 72.8 percent and Capital Grants and Contributions have increased by $6,064,000 or 54.1 percent. The Operating Grants and Contributions decrease is due to a one-time revenue stream of $29,607,000 for American Rescue Plan Act (ARPA) Grant the City recognized in the prior year. The majority of the increase in Capital Grants and Contributions is related to a one- time $4,900,000 grant received that is to be used for various capital improvement project. Program expenses increased by $35,665,000, or 12.4 percent primarily due to increases in Police and Fire cost. Both departments had an overall increase of $24,325,000 which is due to increase in personal cost and pension expense. Total resources available during the year to finance governmental operations were $1,022,756,000 consisting of net position at July 1, 2023 of $636,581,000, program revenues of $115,855,000, and general revenues of $270,320,000. Total expenses for governmental activities during the year were $322,733,000 plus transfers of $55,000. Thus, net position increased by $63,387,000 or 10.0 percent, to $699,968,000. 15 187 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 A condensed summary of business-type activities (in thousands) follows: The City’s net position from business-type activities decreased by $2,717,000 before transfers. This is mainly due increased pension expense. Charges for current services for business-type activities decreased $1,615,000 due to the Water Fund not participating in the Coastal Pumping Transfer Program. This program reimburses the City of Huntington Beach for additional cost incurred for purchasing water rather than pumping from the city’s own wells. This is only done at OCWD’s request. No request was made in Fiscal Year 2023-24. The cost of all business-type activities this year was $80,347,000. As shown in the Statement of Activities, the amount paid by users of the systems was $73,476,000, unrealized market gain of $4,154,000, and transfers totaling $55,000. Beginning net position was $199,478,000 and ending net position was $196,816,000, a decrease of $2,662,000, or 1.3 percent. Of the ending net position, $142,063,000, or 72.2 percent, was invested in capital assets, $24,394,000 or 12.4 percent was restricted for expenses for the Water Master Plan, and $30,359,000, or 15.4 percent was unrestricted. Transfers in for business-type activities were $55,000 for the current year. June 30, 2024 June 30, 2023 Amount Increase (Decrease) Percent Increase (Decrease) Program Revenues: Charges for Current Services 73,476$ 75,091$ (1,615)$ -2.2% Total Program Revenues 73,476 75,091 (1,615) -2.2% Use of Money and Property (Loss)4,154 1,356 2,798 206.3% Total Revenues 77,630 76,447 1,183 1.5% Expenses: Water Utility 52,397 47,974 4,423 9.2% Sewer Service 12,213 11,422 791 6.9% Refuse Collection 15,543 14,935 608 4.1% Hazmat Service 194 103 91 88.3% Total Expenses 80,347 74,434 5,913 7.9% Increase (Decrease) in Net Position Before Transfers (2,717) 2,013 Transfers 55 38 Total Change In Net Position (2,662) 2,051 Net Position - Beginning of Year 199,478 197,427 Net Position - End of Year 196,816$ 199,478$ Business-Type Activities 16 188 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 Financial Analysis of the City’s Major Governmental Funds Below is an analysis of the City’s major governmental fund activities for the year (in thousands): The General Fund Balance increased by $5,782,000 largely due to increases in property taxes and use of money and property revenues. Due to strong enconomic growth this past fiscal year, the General Fund had unrealized market gain on invesetments of $5,181,000. The Grants Special Revenue Fund Balance increased by $2,057,000 primarily due to $4,900,000 AEG Developer Funds received in prior year being transferred from the General Fund to the Grants Special Revenue Fund in Fiscal Year 2023/24. The LMIHAF Capital Projects Fund Balance increased by $2,991,000 due to the Department of Finance’s decision on Emeral Cove Housing Project promissory note issued by the former Redevelopment Agency to the City as an enforceable obligation. This decision resulted in $3,801,000 revenue for the fund. The Pension Liability Fund increased by $11,137,000, largely due to revenues set aside from the voter-approved property tax override and amount charged to other funds dedicated to the payment of Public Safety pension costs. The Infrastructure Fund decreased by $4,001,000 due to the City spending more on needed infrastructure improvement throughout the City. Major projects include police facility improvements, mobility and corridor improvements, residential pavements, arterial beautification, and sustainability-related capital improvements. June 30, 2024 June 30, 2023 Amount Increase (Decrease) Percent Increase (Decrease) Total Fund Equity: General Fund 132,319$ 126,537$ 5,782$ 4.6% Grants Special Revenue Fund 2,712 655 2,057 314.0% LMIHAF Capital Projects Fund 7,910 4,919 2,991 60.8% Pension Liability Fund 36,119 24,982 11,137 44.6% Infrastructure 29,397 33,398 (4,001) -12.0% Total Fund Equity 208,457$ 190,491$ 17,966$ 9.4% Governmental Funds 17 189 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 Financial Analysis of the City’s Major Proprietary Funds Below is an analysis of the fund equity of the City’s proprietary funds (in thousands): The Water Fund total net position decreased by $4,165,000 due to the City receiving one- time revenue from Orange County Water District in prior year of $3,956,000. All other enterprise funds generated revenue that exceeded expenses in Fiscal Year 2023/24 due to unrealized market gain on investments. Long-Term Obligations Below is a schedule of the changes to the City’s long-term obligations (in thousands): Additional information on the City’s long-term debt is shown in Note 11 and Note 14 to the financial statements. Note 14, Leases, provides detail related to GASB 87 related June 30, 2024 June 30, 2023 Amount Increase (Decrease) Percent Increase (Decrease) Net Position: Water Fund 116,368$ 120,533$ (4,165)$ -3.5% Sewer Fund 79,813 75,606 4,207 5.6% Refuse Fund 216 35 181 517.1% Hazmat Service Fund 419 304 115 37.8% Total Net Position 196,816$ 196,478$ 338$ 0.2% Unrestricted Net Position: Water Fund 5,923$ 10,880$ (4,957)$ -45.6% Sewer Fund 24,722 25,556 (834) -3.3% Refuse Fund 132 (56) 188 335.7% Hazmat Service Fund 413 304 109 35.9% Total Unrestricted Net Position 31,190$ 36,684$ (5,494)$ -15.0% Enterprise Funds Governmental Activities:June 30, 2023 Additions Retirements June 30, 2024 Revenue Bonds 25,160$ -$ (2,250)$ 22,910$ Compensated Absences 14,818 5,241 (4,526) 15,533 Claims Payable 66,621 21,573 (27,099) 61,095 Pollution Remediation 2,000 - - 2,000 LED Lighting Phase I 191 - (126) 65 I-Bank CLEEN Loan 1,283 - (310) 973 CEC Loan 1,797 - (269) 1,528 Pension Obligation Bonds 318,005 - (12,683) 305,322 Finance Purchase Agreement 17,388 - (3,098) 14,290 Leases Payable 456 - (216) 240 Subscriptions Payable 2,600 2,666 (1,466) 3,800 Total Long-Term Obligations Governmental Activities 450,319 29,480 (52,043) 427,756 Business-Type Activities: Compensated Absences 1,826 416 (484) 1,758 Pension Obligation Bonds 20,480 - (891) 19,589 Business-Type Activities:22,306 416 (1,375) 21,347 Total Long-Term Obligations 472,625$ 29,896$ (53,418)$ 449,103$ 18 190 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 Lease Payable while Note 11 provides detail related to all other long-term debt. The City of Huntington Beach is legally restricted to issuing general obligation bonds to 12 percent of its assessed valuation. Since the City has no general obligation bonds outstanding, the limit does not apply. The City’s total long-term obligations decreased by $23,552,000 or 5.0 percent from the prior fiscal year as the reduction in total debt related to annual debt service payments was partially offset by new claims payable liabilities and lease obligations. The City continues to maintain strong credit ratings on all of its debt issues. Most notably, on August 27, 2014 Fitch Ratings issued an AAA Implied General Obligation Bond rating to the City of Huntington Beach and that same rating was most recently reaffirmed in September 2024. The following are the ratings as determined by Standard and Poor’s and Fitch Ratings as of June 30, 2024. Capital Assets The capital assets of the City are those assets which are used in the performance of the City’s functions including infrastructure assets. The City has elected to use the “Basic Approach” as defined by GASB Statement No. 34 for infrastructure reporting. The following infrastructure networks are recorded as capital assets in the government-wide financial statements: x Storm drain system including pump stations, drainage system and manholes. x Streets (including land underneath streets), traffic signals, curbs, gutters, and sidewalks. Debt Instrument S & P Fitch 1999 Tax Allocation Refunding Bonds AA-AA 2002 Tax Allocation Refunding Bonds AA-N/A 2014 Lease Revenue Bonds, Series A AA AA+ 2020(a) Lease Revenue Bonds AA AA+ 2020(b) Lease Revenue Bonds AA AA+ 2021 Pension Obligation Bonds AA+AAA 19 191 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 Below is a schedule of the City’s capital assets, net of accumulated depreciation (in thousands): Capital assets from governmental activities increased $19,473,000 or 2.5 percent. This increase is largely due to street replacement infrastructure costs and construction improvements throughout the City. Capital assets from business-type activities decreased $349,000 or 0.2 percent largely due to depreciation expense exceeding assets capitalized. Further information on the City’s capital assets can be found in Note 12 of the financial statements. Furthermore, GASB Statement No. 87, Leases, requires a lessee to recognize a lease liability and intangible right-to-use lease asset. As noted above, the right-to-use lease asset is to be included as a capital asset. For Fiscal Year 2023/24, the City reported $243,000 in right-to-use lease assets. General Fund Budgetary Highlights Changes to Original Budget Comparing the Fiscal Year 2023/24 General Fund Original (i.e. Adopted) Budget expenditures amount of $227,178,000 to the final budgeted amount of $265,498,000 shows a net increase of $38,320,000, or 16.9 percent. This overall increase is primarily due to budget carryovers of $7,678,000, increased transfers to Equipment Fund of $5,453,000, Section 155 Trust of $1,435,000, Self Insurance General Liability Fund of $15,569,000, Self Insurance Worker’s Compensation Fund of $4,245,000 and operating increases of $4,513,000 increase. Governmental Activities: June 30, 2024 June 30, 2023 Amount Increase (Decrease) Percent Increase (Decrease) Land 369,538$ 369,538$ -$ 0.0% Buildings 125,878 127,820 (1,942) -1.5% Machinery and Equipment 38,543 32,401 6,142 19.0% Construction in Progress 15,141 11,249 3,892 34.6% Infrastructure 237,968 227,641 10,327 4.5% Right to Use Leased Land 22 106 (84) -79.2% Right to Use Leased Machinery and Equipment 221 356 (135) -37.9% Right to Use SBITA Asset 4,200 2,927 1,273 43.5% Total Governmental Activities 791,511 772,038 19,473 2.5% Business-Type Activities: Land 3,907 3,907 - 0.0% Buildings 63,515 66,089 (2,574) -3.9% Machinery and Equipment 6,142 6,064 78 1.3% Construction in Progress 3,383 839 2,544 303.2% Infrastructure 64,287 64,684 (397) -0.6% Total Business-Type Activities 141,234 141,583 (349) -0.2% Total Capital Assets 932,745$ 913,621$ 19,124$ 2.1% 20 192 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 Final budgeted revenues for the General Fund increased $8,267,000 or 2.9 percent from the original (adopted) budget for the Fiscal Year ended June 30, 2024. The change from original to final budget occurred primarily as a result of adjustments made to budgeted property tax, sales tax, utility tax, other taxes, and transfers from other funds. Variance with Final Budget General Fund actual revenues were more than the final budget by $5,161,000 for the Fiscal Year ended June 30, 2024. This budget variance is due in large part to actual investment returns outperforming budgeted amounts and intergovernmental revenues. General Fund expenditures were $10,219,000 less than the final budget. The favorable budget variance is due in large part to the following: x The Information Services Departments realized $1,535,000 in savings primarily due to differences in projected versus actual cost of providing services. x Community Development Departments realized $4,742,000 in savings primarily due to differences in the projected versus actual timing of design, construction, and maintenance contracts for projects, as well as the deferral of various building and planning contracts. Analysis of City’s Other Major Governmental Funds Grants Special Revenue Fund The fund balance in the Grant Special Revenue Fund increased by $2,057,000 primarily due to $4,900,000 AEG Developer Funds received in prior year being transferred from the General Fund transferred to the Grants Special Revenue Fund in Fiscal Year 2023/24. LMIHAF Capital Projects Fund The LMIHAF Capital Projects Fund Balance increased by $2,991,000 due to the Department of Finance agreeing to Emeral Cove Housing Project promissory note issued by the former Redevelopment Agency to the City as an enforceable obligation. This decision resulted in $3,801,000 revenue for the fund. Pension Liability Debt Service Fund The fund balance in the Pension Liability Debt Service Fund increased by $11,137,000 due to revenues set-aside from the voter-approved property tax override dedicated to the payment of Public Safety pension costs and employee’s contribution to the fund. 21 193 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 Economic Factors and Next Year’s Budget The Adopted FY 2024/25 Budget totals $527.2 million in all funds. This reflects a $19.2 million, or 3.8 percent increase from the FY 2023/24 Adopted All Funds Budget of $508.0 million. A significant portion of the increase is due to the General Fund Revenue. General Fund expenditures total $300.0 million and are supported by revenues of $301.7 million. The Adopted General Fund Budget has no reliance on one-time revenues to fund ongoing operations, which is critical to maintaining the City’s financial viability and success, and represents a $14.8 million, or 5.2 percent, increase compared to the FY 2023/34 Adopted Budget of $285.2 million. Public Safety: Funding for Public Safety represents 51 cents for every dollar spent in the General fund. With more than half of the General Fund Budget committed to the Police and Fire Departments, the City has dedicated the greatest share of its resources, or $154.4 million, to these core services to ensure the safety and protection of all community members. In the Police Department, the Adopted Budget includes $100,000 for training and supplies, approximately $129,000 for new laptop equipment, licensing, and cellular connectivity with the transition to the new CAD/RMS system and $190,000 for a larger horse trailer and truck with the expansion to five horses in the Mounted Enforcement Unit. The CIP includes $109,000 for the retrofitting and refurbishing of the PD South Substation constructed in 1913. In the Fire Department, the Adopted Budget includes $1.3M for the purchase of a triple combination fire pumper. The General Fund CIP includes $600,000 for the installation of a butler building at the Murdy and Gothard fire stations for storing additional apparatuses currently being stored outside causing more wear and tear. Revenue growth, reining in expenditures, strong reserves, and public service excellence are areas of focus for the organization. The City’s commitment to financial sustainability is also demonstrated by its proactive approach to addressing future budget challenges through the Adopted Budget Balancing Plan, which identifies $1.65 million in ongoing new revenues and $5.03 million in ongoing expenditure reductions, including $1.5 million in savings through implementation of a managed hiring program. The FY 2024/25 Budget is structurally balanced and continues the efforts made during Fiscal Year 2023/24. However, General Fund budget deficits are projected in future fiscal years. To address these challenges, City staff is continuing efforts to identify revenue growth opportunities, improved operational efficiencies, and expenditure reductions to support the City’s long- term fiscal health. 22 194 City of Huntington Beach Management’s Discussion and Analysis For the Year Ended June 30, 2024 General Fund Revenue General Fund revenues are anticipated to be $301.7 million, a $17.8 million, or 6.3 percent increase from the FY 2023/24 Adopted Budget. The largest increases are in Revenue from Other Agencies, attributable to participation in the Voluntary Rate Range Intergovernmental Transfer (VRRP IGT) Program, and in Non-operating Revenue, which accounts for a one-time transfer of $6.9 million for the first repayment related to the Waterfront Loan Superior Court Judgement. x Property Tax is the largest revenue category for the City and is anticipated to increase by $4.0 million or 3.8 percent to $104.2 million due to gains in assessed property valuations. x Charges for Current Services is projected to increase $2.3 million due to increases in some of the fees, including medical transport, as well as increased demand for services, such as recreation classes and fitness center memberships. Contacting the City’s Financial Management Team This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general overview of the City’s finances and to show the City’s accountability for the money it receives. If you have questions about this report, separate reports of the City’s component units or need any additional financial information, contact the Finance Department at 2000 Main Street, Huntington Beach, California, 92648-2702, phone (714) 536-5630 or email tvi@surfcity-hb.org. 23 195 %$6,&),1$1&,$/67$7(0(176 24 196 ASSETS Governmental Activities Business-Type Activities Total Current Assets: Cash and Investments 328,994$ 82,380$ 411,374$ Cash and Investments with Fiscal Agent 3,581 - 3,581 Receivables, Net 52,886 7,668 60,554 Advances to Successor Agency 26,272 - 26,272 Lease Receivable 9,462 - 9,462 Inventories - 1,531 1,531 Prepaids 7,837 - 7,837 Joint Venture 267 2,647 2,914 Total Current Assets 429,299 94,226 523,525 Capital Assets: Non-Depreciable 384,679 7,290 391,969 Depreciable, Net 406,832 133,944 540,776 Total Capital Assets 791,511 141,234 932,745 Non-Current Assets: Net Other Postemployment Benefits Asset 4,653 554 5,207 Total Non-Current Assets 4,653 554 5,207 Total Assets 1,225,463 236,014 1,461,477 DEFERRED OUTFLOWS OF RESOURCES Deferred Outflows Related to Pensions 121,739 7,649 129,388 Deferred Outflows Related to Other Postemployment Benefits 5,096 606 5,702 Total Deferred Outflows of Resources 126,835 8,255 135,090 LIABILITIES Current Liabilities: Accounts Payable 15,400 10,678 26,078 Accrued Payroll 3,121 267 3,388 Unearned Revenue 3,774 - 3,774 Accrued Interest Payable 614 22 636 Deposits 2,763 1,722 4,485 Long-Term Obligations Due Within One Year 36,231 1,377 37,608 Total Current Liabilities 61,903 14,066 75,969 Long-Term Obligations: Long-Term Obligations Due in More than One Year 391,525 19,970 411,495 Net Pension Liability 180,967 12,484 193,451 Total Long-Term Obligations 572,492 32,454 604,946 Total Liabilities 634,395 46,520 680,915 DEFERRED INFLOWS OF RESOURCES Deferred Inflows Related to Pensions 974 7 981 Deferred Inflows Related to Other Postemployment Benefits 7,770 926 8,696 Deferred Inflows Lease Related 9,191 - 9,191 Total Deferred Inflow of Resources 17,935 933 18,868 NET POSITION Net Investment in Capital Assets 751,578 141,232 892,810 Restricted for: Debt Service 40,631 - 40,631 Capital Projects 25,105 23,840 48,945 Public Works and Community Services Projects 57,146 - 57,146 OPEB Benefits 4,653 554 5,207 Total Restricted Net Position 127,535 24,394 151,929 Unrestricted (179,145) 31,190 (147,955) Total Net Position 699,968$ 196,816$ 896,784$ CITY OF HUNTINGTON BEACH STATEMENT OF NET POSITION JUNE 30, 2024 (In Thousands) See Notes to the Financial Statements 25 197 Program Revenues Functions/Programs Expenses Charges for Current Services Operating Grants and Contributions Capital Grants and Contributions Governmental Activities Business- Type Activities Total Governmental Activities: City Council 441$ 175$ -$ -$ (266)$ -$ (266)$ City Manager 7,699 4,057 1,695 42 (1,905) - (1,905) City Treasurer 2,124 161 - - (1,963) - (1,963) City Attorney 4,156 6 - - (4,150) - (4,150) City Clerk 1,674 508 - - (1,166) - (1,166) Finance 6,499 3,280 - - (3,219) - (3,219) Human Resources 2,786 7,670 - - 4,884 - 4,884 Community Development 19,124 11,102 3,903 693 (3,426) - (3,426) Fire 78,253 20,228 79 - (57,946) - (57,946) Information Services 8,682 654 - - (8,028) - (8,028) Police 107,440 5,558 1,794 - (100,088) - (100,088) Community Services 15,176 24,713 686 97 10,320 - 10,320 Library Services 7,409 229 548 - (6,632) - (6,632) Public Works 51,560 8,570 2,973 16,434 (23,583) - (23,583) Interest on Long-Term Debt 9,710 - - - (9,710) - (9,710) Total Governmental Activities 322,733 86,911 11,678 17,266 (206,878) - (206,878) Business-type Activities: Water Utility 52,397 45,739 - - - (6,658) (6,658) Sewer Service 12,213 11,798 - - - (415) (415) Refuse Collection 15,543 15,637 - - - 94 94 Hazmat Service 194 302 - - - 108 108 Total Business-Type Activities 80,347 73,476 - - - (6,871) (6,871) Total Governmental and Business Type Activities 403,080$ 160,387$ 11,678$ 17,266$ (206,878)$ (6,871)$ (213,749)$ General Revenues: Taxes: Property Taxes 114,630$ -$ 114,630$ Sales Taxes 56,003 - 56,003 Utility Taxes 23,283 - 23,283 Franchise Taxes 9,625 - 9,625 Transient Occupancy Tax 17,399 - 17,399 Total Taxes 220,940 - 220,940 Other: Use of Money and Property 12,361 4,154 16,515 From Other Agencies - Unrestricted 5,883 - 5,883 Gain from Elimination of Allowances 31,136 - 31,136 Total General Revenues 270,320 4,154 274,474 Transfers (55) 55 - Total General Revenues and Transfers 270,265 4,209 274,474 Change in Net Position 63,387 (2,662) 60,725 Net Position - Beginning of Year 636,581 199,478 836,059 Net Position - End of Year 699,968$ 196,816$ 896,784$ Net (Expense) Revenue and Changes in Net Position CITY OF HUNTINGTON BEACH STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) See Notes to the Financial Statements 26 198 CITY OF HUNTINGTON BEACH BALANCE SHEET GOVERNMENTAL FUNDS JUNE 30, 2024 (In Thousands) ASSETS General Fund Grants Special Revenue LMIHAF Capital Projects Pension Liability Infrastructure Other Governmental Funds Total Cash and Investments 123,561$ 5,649$ 6,968$ 35,786$ 33,015$ 69,141$ 274,120$ Cash and Investments with Fiscal Agent - - - - - 3,581 3,581 Taxes Receivable 14,480 - - 103 - 1,398 15,981 Other Receivables, Net 7,904 11,119 14,253 232 120 1,885 35,513 Lease Receivable 9,462 - - - - - 9,462 Advances to Successor Agency 24,909 - 1,363 - - - 26,272 Prepaids 177 - - - - 5,165 5,342 Total Assets 180,493 16,768 22,584 36,121 33,135 81,170 370,271 LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND FUND BALANCES LIABILITIES Accounts Payable 6,317 2,482 441 2 3,697 1,286 14,225 Accrued Payroll 3,001 17 - - 41 52 3,111 Unearned Revenue 1,272 2,502 - - - - 3,774 Deposits Payable 2,763 - - - - - 2,763 Total Liabilities 13,353 5,001 441 2 3,738 1,338 23,873 DEFERRED INFLOWS OF RESOURCES Deferred Inflows Lease Related 9,191 - - - - - 9,191 Unavailable Revenue 25,630 9,055 14,233 - - 82 49,000 Total Deferred Inflows of Resources 34,821 9,055 14,233 - - 82 58,191 FUND BALANCES Nonspendable Prepaids 148 - - - - - 148 Restricted Underground Utilities 364 - - - - - 364 Restitution 317 - - - - - 317 Donations 777 - - - - - 777 Section 115 Trust 20,212 - - - - - 20,212 Pollution Remediation - - - - - 336 336 Debt Service - - - 36,119 - 4,512 40,631 Highways, Streets and Transportation - - - - - 19,675 19,675 Low Income Housing - - 7,910 - - 12,305 20,215 Air Quality - - - - - 828 828 Other Capital Projects - - - - - 17,559 17,559 Other Purposes - 2,712 - - - 3,613 6,325 Committed Economic Uncertainties 49,090 - - - - - 49,090 Parks - - - - - 7,142 7,142 Other Capital Projects 1,379 - - - 29,397 2,866 33,642 Other Purposes 1,554 - - - - 4,152 5,706 Assigned Litigation Reserves 3,650 - - - - - 3,650 Capital Improvement Reserve 9,425 - - - - 6,762 16,187 Equipment Replacement 8,295 - - - - - 8,295 General Plan Maintenance 1,651 - - - - - 1,651 HB Recovery Fund 10,886 - - - - - 10,886 Oceanview Estates 641 - - - - - 641 General Liability Plan Migration 2,801 - - - - - 2,801 Pension Rate Stabilization 5,517 - - - - - 5,517 Section 115 Trust 4,211 - - - - - 4,211 Year-End Fair Value 3,025 - - - - - 3,025 Other Purposes 8,376 - - - - - 8,376 Total Fund Balances 132,319 2,712 7,910 36,119 29,397 79,750 288,207 Total Liabilities, Deferred Inflows of Resources and Fund Balances 180,493$ 16,768$ 22,584$ 36,121$ 33,135$ 81,170$ 370,271$ See Notes to the Financial Statements 27 199 Amounts reported for governmental activities in the statement of net position are different because: Total Fund Balances Governmental Funds 288,207$ Net Other Postemployment Benefits Asset is not available to pay in the current period and therefore are not reported in the funds. Net Other Postemployment Benefits Asset 4,628 Net Capital Assets used in governmental activities are not current financial resources and, therefore, are not reported in the governmental funds. Amounts exclude Net Capital Assets of the Internal Service Funds. Capital Assets 1,197,076 Accumulated Depreciation (421,210) Total Capital Assets 775,866 Joint Venture 267 Right to Use Leased/SBITA Assets used in governmental activities are not current financial resources and, therefore, are not reported in the governmental funds. Right to Use Leased Assets 672 Right to Use SBITA Assets 6,236 Accumulated Amortization (2,465) Total Right to Use Assets 4,443 Internal Service Funds are used by management to charge the cost of various city activities to individual governmental and business-like funds. The assets and liabilities of the Internal Service Fund must be added to the Statement of Net Position.6,459 Revenues that are measurable but not available are not recognized as revenue in governmental funds. Such amounts are recorded as Unavailable Revenue under the modified accrual basis of accounting.49,000 Deferred Outflows Related to Pensions 121,370 Deferred Outflows Related to Other Postemployment Benefits (OPEB)5,069 Governmental Funds report all pension contributions as expenditures; however, in the Statement of Net Position, the excess of the total pension liability over the plan Fiduciary Net Position is reported as a Net Pension Liability.(180,367) Deferred Inflows Related to Pensions (973) Deferred Inflows Related to Other Postemployment Benefits (OPEB)(7,728) Other long-term liabilities are not due in the current period and, therefore, are not recorded in the governmental funds. Accrued Interest Payable (614) Long-term liabilities, including bonds and certificates of participation payable, are not due and payable in the current period and therefore are not reported in the governmental funds. Amounts exclude Long-Term Obligation of the Internal Service Fund. Long-Term Obligations Due in One Year (21,809) Long-Term Obligations Due in More than One Year (343,850) Net Position of Governmental Activities 699,968$ (In Thousands) CITY OF HUNTINGTON BEACH RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET POSITION JUNE 30, 2024 See Notes to the Financial Statements 28 200 REVENUES General Fund Grants Special Revenue LMIHAF Capital Projects Pension Liability Infrastructure Other Governmental Funds Total Property Taxes 105,750$ -$ -$ 8,880$ -$ -$ 114,630$ Sales Taxes 51,421 - - - - 4,582 56,003 Utility Taxes 23,283 - - - - - 23,283 Other Taxes 27,024 - - - - 441 27,465 Licenses and Permits 10,200 - - - - 393 10,593 Fines and Forfeitures 3,666 - - - - - 3,666 Use of Money and Property (Loss)30,133 276 790 767 1,474 4,329 37,769 Intergovernmental 11,387 12,141 3,801 - 50 11,543 38,922 Charges for Current Services 31,671 - - 21,073 - 3,539 56,283 Other 2,234 814 - - 67 98 3,213 Total Revenues 296,769 13,231 4,591 30,720 1,591 24,925 371,827 EXPENDITURES Current: City Council 464 - - - - - 464 City Manager 4,853 1,777 - - - 487 7,117 City Treasurer 2,059 - - - - - 2,059 City Attorney 3,994 - - - - - 3,994 City Clerk 1,653 - - - - - 1,653 Finance 5,963 - - 5 - 31 5,999 Human Resources 2,636 - - - - - 2,636 Community Development 13,410 3,277 1,600 - - 1,125 19,412 Fire 71,576 36 - - - 4,635 76,247 Information Services 7,896 - - - - 1,020 8,916 Police 99,071 3,551 - - - 846 103,468 Community Services 12,354 324 - - 219 1,282 14,179 Library Services 6,954 229 - - - 52 7,235 Public Works 27,436 6,880 - - 22,122 12,731 69,169 Debt Service: Principal 5,485 - - 12,640 - 2,250 20,375 Interest 585 - - 8,438 - 705 9,728 Total Expenditures 266,389 16,074 1,600 21,083 22,341 25,164 352,651 Excess (Deficiency) of Revenues Over (Under) Expenditures 30,380 (2,843) 2,991 9,637 (20,750) (239) 19,176 OTHER FINANCING SOURCES (USES) Transfers In 478 4,900 - 1,500 16,749 5,137 28,764 Subscription Based IT Arrangement 2,666 - - - - - 2,666 Transfers Out (27,742) - - - - (1,077) (28,819) Total Other Financing Sources (Uses) (24,598) 4,900 - 1,500 16,749 4,060 2,611 Net Change In Fund Balances 5,782 2,057 2,991 11,137 (4,001) 3,821 21,787 Fund Balances - Beginning of Year 126,537 655 4,919 24,982 33,398 75,929 266,420 Fund Balances - End of Year 132,319$ 2,712$ 7,910$ 36,119$ 29,397$ 79,750$ 288,207$ (In Thousands) CITY OF HUNTINGTON BEACH STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 See Notes to the Financial Statements 29 201 Amounts reported for governmental activities in the statement of activities are different because: Net Changes in Fund Balances - Total Governmental Funds 21,787$ Capital expenditures - governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of these assets are allocated over their estimated useful lives and reported as depreciation expense. Depreciable Assets Purchased 33,510 Depreciable Assets Disposition (6) Non-Depreciable Assets Purchased 10,363 Non-Depreciable Assets Disposition (6,471) Capital Asset Depreciation (19,716) Joint Venture 52 Accrual of revenues - certain revenues in the Statement of Activities do not meet the "availability" criteria for revenue recognition in the governmental funds and are not reported in the governmental funds as revenue. Current Year Grant and Other Revenue Accrual 39,145 Prior Year Grant and Other Revenue Accrual (3,724) Repayments on long-term receivables provide current financial resources to governmental funds, while loans provided consume the current financial resources of governmental funds. These transactions, however, have no effect on net position.(779) Pension income reported in the statement of activities includes the change in the the net pension liability and related changes in pension amounts for deferred outflows and deferred inflows of resources. (45,163) Other Postemployment Benefits Payments - 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 (expenses).649 Internal Service Funds are used by management to charge the costs of certain activities, such as self insurance workers' compensation charges. The net revenue of this internal service fund is reported as governmental activities. 16,721 Liabilities not liquidated with current resources - some 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. Current Year Interest Accrual (614) Prior Year Interest Accrual 632 Repayment of long-term debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the Statement of Net Position. 20,375 The issuance of long-term debt provides current financial resources to governmental funds. (2,666) The repayment of some expenses such as compensated absences, claims, and pension expenses, reported in the statement of activities, do not require the use of current resources, and therefore are not reported as expenditures in the governmental funds.(708) Change in Net Position of Governmental Activities 63,387$ FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) CITY OF HUNTINGTON BEACH RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES See Notes to the Financial Statements 30 202 Governmental Activities Water Fund Sewer Service Fund Refuse Fund Hazmat Service Fund Total Internal Service Funds ASSETS Current Assets: Cash and Investments 24,931$ 32,240$ 598$ 771$ 58,540$ 54,874$ Restricted Cash and Investments 23,840 - - - 23,840 - Other Receivables, Net 2,747 723 801 15 4,286 1,392 Prepaids - - - - - 2,495 Joint Ventures 2,647 - - - 2,647 - Inventories 1,531 - - - 1,531 - Unbilled Receivables 2,101 562 719 - 3,382 - Total Current Assets 57,797 33,525 2,118 786 94,226 58,761 Capital Assets: Land 3,907 - - - 3,907 - Buildings and Improvements 57,933 47,690 - - 105,623 67 Machinery and Equipment 15,965 4,751 215 - 20,931 16,769 Infrastructure 108,778 47,178 - - 155,956 - Construction in Progress 273 3,110 - - 3,383 - Less Accumulated Depreciation (100,647) (47,774) (145) - (148,566) (5,634) Total Capital Assets 86,209 54,955 70 - 141,234 11,202 Non-Current Assets: Net Other Postemployment Benefits Asset 398 136 14 6 554 25 Total Non-Current Assets 398 136 14 6 554 25 Total Assets 144,404 88,616 2,202 792 236,014 69,988 DEFERRED OUTFLOWS OF RESOURCES Deferred Outflows Related to Pensions 5,352 2,002 179 116 7,649 369 Deferred Outflows Related to Other Postemployment Benefits 436 149 15 6 606 27 Total Deferred Outflows of Resources 5,788 2,151 194 122 8,255 396 Total Assets and Deferred Outflows of Resources 150,192 90,767 2,396 914 244,269 70,384 LIABILITIES Current Liabilities: Accounts Payable 7,686 1,798 1,194 - 10,678 1,175 Accrued Payroll 184 72 9 2 267 10 Deposits Payable 1,508 64 150 - 1,722 - Interest Payable 15 6 1 - 22 - Current Portion of Claims Payable - - - - - 14,363 Current Portion of Compensated Absences 358 106 14 1 479 16 Long-Term Obligations Due Within One Year 628 235 21 14 898 43 Total Current Liabilities 10,379 2,281 1,389 17 14,066 15,607 Non-Current Liabilities: Compensated Absences 958 283 36 2 1,279 43 Long-Term Obligations Due in More than One Year 13,079 4,892 439 281 18,691 900 Net Pension Liability 8,738 3,268 293 185 12,484 600 Claims Payable - - - - - 46,732 Total Non-Current Liabilities 22,775 8,443 768 468 32,454 48,275 Total Liabilities 33,154 10,724 2,157 485 46,520 63,882 DEFERRED INFLOWS OF RESOURCES Deferred Inflows Related to Pensions 5 2 - - 7 1 Deferred Inflows Related to Other Postemployment Benefits 665 228 23 10 926 42 Total Deferred Inflows of Resources 670 230 23 10 933 43 NET POSITION Investment in Capital Assets 86,207 54,955 70 - 141,232 25,565 Restricted for: Capital Projects 23,840 - - - 23,840 - OPEB Benefits 398 136 14 6 554 25 Unrestricted 5,923 24,722 132 413 31,190 (19,131) Total Net Position 116,368 79,813 216 419 196,816 6,459 Total Liabilities, Deferred Inflows of Resources, and Net Position 150,192$ 90,767$ 2,396$ 914$ 244,269$ 70,384$ PROPRIETARY FUNDS STATEMENT OF NET POSITION CITY OF HUNTINGTON BEACH Business-Type Activities - Enterprise Funds (In Thousands) June 30, 2024 See Notes to the Financial Statements 31 203 Governmental Activities Water Fund Sewer Service Fund Refuse Fund Hazmat Service Fund Total Internal Service Funds OPERATING REVENUES Sales 41,024$ -$ -$ -$ 41,024$ -$ Fees and Charges for Service - 11,643 15,551 302 27,496 36,760 Other 4,715 155 86 - 4,956 9,358 Total Operating Revenues 45,739 11,798 15,637 302 73,476 46,118 OPERATING EXPENSES Water Purchases 17,302 - - - 17,302 - Supplies and Operations 13,956 9,663 15,510 186 39,315 4,369 Engineering 2,743 - - - 2,743 - Production and Distribution 10,900 - - - 10,900 - Maintenance 73 - - - 73 - Water Meters 2,024 - - - 2,024 - Water Quality 792 - - - 792 - Water Use Efficiency 298 - - - 298 - Claims and Judgments - - - - - 24,964 Depreciation 3,937 2,411 21 - 6,369 2,019 Total Operating Expenses 52,025 12,074 15,531 186 79,816 31,352 Operating Income (Loss) (6,286) (276) 106 116 (6,340) 14,766 NON-OPERATING REVENUES (EXPENSES) Investment Income 2,493 1,622 19 20 4,154 1,981 Interest Expense (372) (139) (12) (8) (531) (26) Total Non-Operating Revenues (Expenses) 2,121 1,483 7 12 3,623 1,955 Income (Loss) Before Transfers (4,165) 1,207 113 128 (2,717) 16,721 TRANSFERS Transfers In - - 68 - 68 - Transfers Out - - - (13) (13) - Total Transfers - - 68 (13) 55 - Change in Net Position (4,165) 1,207 181 115 (2,662) 16,721 Net Position - Beginning of Year 120,533 78,606 35 304 199,478 (10,262) Net Position - End of Year 116,368$ 79,813$ 216$ 419$ 196,816$ 6,459$ Business-Type Activities - Enterprise Funds (In Thousands) FOR THE YEAR ENDED JUNE 30, 2024 PROPRIETARY FUNDS STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION CITY OF HUNTINGTON BEACH See Notes to the Financial Statements 32 204 Governmental Activities Water Fund Sewer Service Fund Refuse Fund Hazmat Service Fund Total Internal Service Funds CASH FLOWS FROM OPERATING ACTIVITIES Cash Received from Customers and Users 49,022$ 11,662$ 15,424$ 305$ 76,413$ 44,891$ Cash Paid to Employees for Services (10,430) (4,345) (432) (130) (15,337) (354) Cash Paid to Suppliers of Goods and Services (34,209) (3,252) (14,939) 1 (52,399) (34,359) Other Operating Items Net Cash and Investment Provided (Used) by Operating Activities 4,383 4,065 53 176 8,677 10,178 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers In - - 68 - 68 - Transfers Out - - - (13) (13) - Principal Paid (624) (233) (21) (13) (891) (43) Interest Paid (372) (139) (12) (8) (531) (26) Net Cash and Investments Provided (Used) by Noncapital Financing Activities (996) (372) 35 (34) (1,367) (69) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Purchase of Capital Assets (1,706) (4,315) 1 - (6,020) (3,812) Net Cash and Investments Provided (Used) by Capital and Related Financing Activities (1,706) (4,315) 1 - (6,020) (3,812) CASH FLOWS FROM INVESTING ACTIVITIES Investment Income 2,493 1,622 19 20 4,154 1,981 Net Cash and Investments Provided (Used) by Investing Activities 2,493 1,622 19 20 4,154 1,981 Net Increase (Decrease) in Cash and Investments 4,174 1,000 108 162 5,444 8,278 Cash and Investments - Beginning of Year 44,597 31,240 490 609 76,936 46,596 Cash and Investments - End of Year 48,771$ 32,240$ 598$ 771$ 82,380$ 54,874$ RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH AND INVESTMENTS PROVIDED (USED) BY OPERATING ACTIVITIES Operating Income (Loss) (6,286)$ (276)$ 106$ 116$ (6,340)$ 14,766$ Adjustments to Reconcile Operating Income (Loss) to Net Cash and Investments Provided (Used) by Operating Activities Depreciation 3,937 2,411 21 - 6,369 2,019 (Increase) Decrease in Other Receivables, Net 3,603 (95) (113) 3 3,398 (1,227) (Increase) in Unbilled Receivables (335) (105) (94) - (534) - (Increase) in Prepaids - - - - - (514) (Increase) in Joint Ventures (427) - - - (427) - Decrease in Inventory 93 - - - 93 - (Increase) in Net Other Postemployment Benefits Asset (243) (83) (9) (4) (339) (15) Increase in Accounts Payable 1,184 1,191 45 - 2,420 470 Increase (Decrease) in Accrued Payroll (6) (9) 1 (1) (15) 2 Increase (Decrease) in Deposits Payable 15 64 (6) - 73 - (Decrease) in Claims Payable - - - - - (5,526) Increase (Decrease) in Compensated Absences 11 (87) 6 2 (68) 7 Decrease in Deferred Pension Outflow 1,427 533 48 28 2,036 97 (Decrease) in Deferred Pension Inflow (12) (5) - - (17) - Increase in Net Pension Liability 1,234 462 41 29 1,766 87 Decrease in Deferred Other Postemployment Benefits Outflow 70 24 3 1 98 5 Increase in Deferred Other Postemployment Benefits Inflow 118 40 4 2 164 7 Net Cash and Investments Provided by Operating Activities 4,383$ 4,065$ 53$ 176$ 8,677$ 10,178$ NONCASH INVESTING, CAPITAL, AND FINANCING ACTIVITIES There were no noncash investing, capital, or financing activities during the year ended June 30, 2024. FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) Business-Type Activities - Enterprise Funds CITY OF HUNTINGTON BEACH STATEMENT OF CASH FLOWS PROPRIETARY FUNDS See Notes to the Financial Statements 33 205 ASSETS Custodial Funds Pension Trust Fund - Retirement Supplemental Fund Huntington Beach Redevelopment Successor Agency Private Purpose Trust Cash and Investments 4,062$ 11$ 7,062$ Cash and Investments with Fiscal Agent 3,357 - 2,761 Mutual Funds - 65,476 - Money Market Funds - 661 - Accounts Receivable, Net 776 - - Interest Receivable - - 119 Total Assets 8,195 66,148 9,942 LIABILITIES Current Liabilities: Accounts Payable 1,362 - 275 Accrued Payroll - - 3 Advances from City of Huntington Beach - - 32,499 Long-Term Obligations Due Within One Year - - 2,372 Total Current Liabilities 1,362 - 35,149 Long-Term Obligations: Long-Term Obligations Due in More than One Year - - 13,854 Total Long-Term Obligations - - 13,854 Total Liabilities 1,362 - 49,003 NET POSITION Restricted for Pension Benefits - 66,148 - Restricted for Individuals and Organizations 6,833 - (39,061) Total Net Position 6,833$ 66,148$ (39,061)$ CITY OF HUNTINGTON BEACH STATEMENT OF FIDUCIARY FUND NET POSITION FIDUCIARY FUNDS JUNE 30, 2024 (In Thousands) See Notes to the Financial Statements 34 206 ADDITIONS Custodial Funds Pension Trust Fund - Retirement Supplemental Fund Huntington Beach Redevelopment Successor Agency Private Purpose Trust Employer Contributions -$ 1,429$ -$ Collected from Property Owners 1,559 - 7,517 Business Improvement District Taxes 6,961 - - Parking Assessments 2,635 - - Total Additions Before Investment Income 11,155 1,429 7,517 Investment Income: Investment Income (Loss) 199 7,080 442 Less: Investment Expense - (126) - Net Investment Income (Loss) 199 6,954 442 Total Additions 11,354 8,383 7,959 DEDUCTIONS Benefits - 5,711 - Administrative Costs 20 351 - Payments to Other Organizations 8,142 - - Economic Development - - 225 Interest and Fiscal Agency Expenses 1,273 - 7,863 General Government - - 31,136 Principal 1,890 - - Total Deductions 11,325 6,062 39,224 Change in Net Position 29 2,321 (31,265) Net Position - Beginning of Year 6,804 63,827 (7,796) Net Position - End of Year 6,833$ 66,148$ (39,061)$ STATEMENT OF CHANGES IN FIDUCIARY FUND NET POSITION FIDUCIARY FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) CITY OF HUNTINGTON BEACH See Notes to the Financial Statements 35 207 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 Footnote Number Description Page 1. Summary of Significant Accounting Policies ............................ 37-54 2. Cash and Investments Notes ...................................................... 55-61 3. Other Receivables ......................................................................... 61-62 4. Unearned Revenue ....................................................................... 63 5. Unavailable Revenue ................................................................... 63 6. Retirement Plan – Normal ........................................................... 64-74 7. Retirement Plan – Supplemental ............................................... 74-81 8. Other Post Employment Benefits .............................................. 82-88 9. Risk Management ................................................................ 89-90 10. Interfund Transactions .......................................................................... 91-92 11. Long-Term Obligations ................................................................. 93-104 12. Capital Assets ................................................................................ 104-105 13. Investment in Joint Ventures ....................................................... 106 14. Leases ............................................................................................. 106 15. Successor Agency Trust for Assets of the Former Redevelopment Agency of the City of Huntington Beach ..... 107-112 16. Commitments and Contingencies .............................................. 112-116 17. Other Information ......................................................................... 116 36 208 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES a. Reporting Entity The City of Huntington Beach is the primary government. It was incorporated in 1909 as a charter, full-service city. The form of government is Council-Manager. Component units are legally separate organizations for which the City Council is financially accountable, or organizations that if excluded from the accompanying financial statements, would make them misleading. The component units described below are blended (presented as if they are part of the primary government) or presented as a fiduciary trust fund with the primary government for financial reporting purposes. The criteria used in determining the scope of the reporting entity are based on the provisions of GASB Statement 14, The Financial Reporting Entity, as amended by GASB Statement 39, Determining Whether Certain Organizations Are Component Units, and GASB Statement 61, The Financial Reporting Entity: Omnibus an amendment of GASB Statements No. 14 and No. 34. A legally separate, tax exempt organization should be reported as a blended component unit of the City if all of the following criteria are met: 1. The governing board is substantively the same as the primary government and there is a financial benefit or burden relationship between the primary government and the component unit; 2. The component unit provides services entirely, or almost entirely, to the primary government or otherwise exclusively, or almost exclusively, benefits the primary government even though it does not provide services directly to it; and 3. The component unit’s total debt outstanding, including leases, is expected to be repaid entirely or almost entirely with the resources of the primary government. Based on the application of the criteria listed above, the following component units have been included. Huntington Beach Housing Authority The Housing Authority (the Authority) was established in March 2011 pursuant to Housing Authority Laws of California to provide rental assistance programs to low- income families and senior citizens, and to operate a Housing Rehabilitation Loan Program and other approved programs. The Authority is governed by a commission of seven members comprised of the City Council, which appoints management and has full accountability for the Authority's fiscal affairs. The Authority's financial data and transactions are included within the capital projects Low and Moderate Income Housing Asset Fund (LMIHAF). On January 9, 2012, the City adopted a resolution designating the Housing Authority of the City of Huntington Beach to serve as the Housing Successor Agency. The Housing Successor Agency's financial data and transactions are included within the LMIHAF Capital Projects Fund. There is no separate Component Unit Financial Report (CUFR) prepared for the Authority. 37 209 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Huntington Beach Public Financing Authority (Public Financing Authority) – This Corporation was formed in March 1988 to issue debt to finance public improvements and other capital purchases for the City and the former Redevelopment Agency. The Public Financing Authority’s governing body is the City Council, which also adopts its annual budget. The Public Financing Authority is financially dependent on the City. There are no separately issued financial statements available for the Public Financing Authority. The City of Huntington Beach Supplemental Retirement Plan and Trust (Supplemental Retirement Plan and Trust) – The Trust was formed to provide a supplemental retirement plan for all employees hired prior to 1997 (exact dates differed for various associations). The governing board of the Supplemental Retirement Plan consists of the City Treasurer, Chief Financial Officer, and the City Manager (or designee). The Retirement Board is responsible for supervising all investments, resolving benefit disputes, and ensuring that contributions are made in order to pay the required benefits. There are no separate financial statements for this plan and trust. b. Government-wide Financial Statements The government-wide financial statements include a Statement of Net Position and a Statement of Activities. These statements present summaries of Governmental and Business-Type Activities for the City accompanied by a total column. Fiduciary activities of the City are not included in these statements. These statements are presented on an “economic resources” measurement focus and the accrual basis of accounting. Accordingly, all of the City’s assets, deferred inflows/outflows of resources, and liabilities, including capital assets, as well as infrastructure assets, and long-term liabilities, are included in the accompanying Statement of Net Position. The Statement of Activities presents changes in Net Position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred. 38 210 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) The Statement of Activities demonstrates the degree to which the direct expenses of a given function or segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Indirect expenses are allocated to the various functions based on a proportionate use of services. The types of transactions reported as program revenues for the City are reported in three categories: 1) charges for current services; 2) operating grants and contributions; and, 3) capital grants and contributions. Taxes and other items not properly included among program revenues are reported as general revenues. As a general rule, the effects of interfund activity have been eliminated from the government-wide financial statements. When both restricted and unrestricted resources are available for use, it is the government’s policy to use restricted resources first, then unrestricted resources as they are needed. Financial Statement Classification In the government-wide financial statements, net position is classified in the following categories: Net Investment in Capital Assets – This category groups all capital assets, including infrastructure, into one component of net position. Accumulated depreciation and the outstanding balances of debt that are attributable to the acquisition, construction, or improvement of these assets reduce this category. Restricted Net Position – This category presents restrictions imposed by creditors, grantors, contributors or laws or regulations of other governments and restrictions imposed by law through constitutional provisions or enabling legislation. The government-wide Statement of Net Position reports $127,535,000 of governmental activities restricted net position. The government-wide Statement of Net Position reports $24,394,000 of business-type activities restricted net position, of which all is restricted by enabling legislation. This category presents restrictions placed on the categories of Capital Projects, Debt Service, and Specific Projects and Programs. 39 211 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Unrestricted Net Position – This category represents the net position of the City, not restricted for any project or other purpose. The government-wide Statement of Net Position reports a deficit unrestricted net position of $179,145,000 of governmental activities, which is largely a result of the City’s Long-Term Obligations at June 30, 2024 is $604,946,000, of which, $572,492,000 is payable from Governmental Activities. The government-wide Statement of Net Position reports $31,190,000 of business-type activities unrestricted net position. c. Fund Financial Statements Separate fund financial statements are prepared for governmental funds, proprietary funds, and fiduciary funds. Major individual governmental and enterprise funds are reported as separate columns in the fund financial statements. Measurement Focus, Basis of Accounting, and Financial Statement Presentation All governmental funds are accounted for on a spending or "current financial resources" measurement focus and the modified accrual basis of accounting. Only current assets, current liabilities, and deferred inflows are included on the Balance Sheets. The Statement of Revenues, Expenditures, and Changes in Fund Balances presents increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Under the modified accrual basis of accounting, revenues are recognized in the accounting period in which they become both measurable and available to finance expenditures of the current period. Revenues are recorded when received in cash, except that revenues subject to accrual (generally 60 days after year-end) are recognized when due. The primary revenue sources, which have been treated as susceptible to accrual by the City, are property tax, sales tax, use of money and property, intergovernmental revenues, charges for current services, and other taxes. Expenditures are recorded in the accounting period in which the related fund liability is incurred. However, debt service expenditures as well as expenditures related to compensated absences and claims are recorded only when payment is due. 40 212 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Governmental Funds Financial Statements Governmental Funds Financial Statements include a Balance Sheet and a Statement of Revenues, Expenditures, and Changes in Fund Balances for all major governmental funds and non-major funds aggregated. Accompanying schedules are presented to reconcile and explain the differences in fund balances and changes in fund balances as presented in these statements to the net position and changes in net position presented in the government-wide financial statements. The City presents all major funds that meet those qualifications. The City’s Governmental Fund Balances are comprised of the following components: x Nonspendable fund balance includes amounts that are not in spendable form and typically includes inventories, prepaid items, and other items that by definition cannot be appropriated. x The restricted fund balance category includes amounts that can be spent only for the specific purposes stipulated by constitution, external resource providers, or through enabling legislation. x The committed fund balance classification includes amounts that can be used only for the specific purposes determined by a formal action of the City Council. The City Council has authority to establish, modify, or rescind a fund balance commitment by formal action as specified by the City’s Fund Balance Policy. Commitments to fund balance are made through adoption of a resolution by City Council. x Amounts in the assigned fund balance classification are intended to be used by the City for specific purposes but do not meet the criteria to be classified as restricted or committed. The City Manager or designee has the authority to establish, modify, or rescind a fund balance assignment as specified by the City’s Fund Balance Policy. x Unassigned fund balance is the residual classification for the City’s General Fund and includes all spendable amounts not contained in the other classifications. Unassigned fund balance in other governmental funds is limited to any negative residual fund balance after fund balance has been classified as restricted, committed, or assigned. 41 213 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) In the government-wide statements, the City considers restricted funds to be spent first then unrestricted amounts when expenditures are incurred for purposes for which unrestricted fund balance is available. In the governmental fund statements, when expenditures are incurred, the City uses the most restrictive funds first. The City would use the appropriate funds in the following order: committed, assigned, and lastly unassigned amounts. The City establishes encumbrances to record the amount of purchase orders, contracts, and other obligations, which have not yet been fulfilled, cancelled, or discharged. Encumbrances outstanding at year-end are recorded as part of committed or assigned fund balance. Encumbrances outstanding as of June 30, 2024, by major fund (in thousands): Economic Uncertainties Reserve The City Council established an Economic Uncertainties Reserve in the General Fund through a resolution with a goal to commit the value of two months of the General Fund expenditure adopted budget amount. Appropriations from the Economic Uncertainties Reserve commitments can only be made by formal City Council action. Generally, appropriations and access to these funds will be reserved for emergency situations. Examples of such emergencies include, but are not limited to: x An unplanned, major event such as catastrophic disaster requiring expenditures over 5% of the General Fund adopted budget; x Budgeted revenue in excess of $1 million taken by another government entity; x Drop in projected/actual revenue of more than 5% of the General Fund adopted revenue budget; and, x Should the Economic Uncertainties Reserve be used, and its level falls below the minimum amount of two months of General Fund expenditures adopted budget, the goal is to replenish the fund within three fiscal years. General Fund 8,502$ Grants Special Revenue 20,818 LMIHAF Capital Projects 820 Infrastructure 25,363 Other Governmental Funds 26,661 Total Encumbrance All Funds 82,164$ 42 214 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Proprietary Fund Financial Statements The City’s enterprise and internal service funds are proprietary funds. Proprietary Fund Financial Statements include a Statement of Net Position, a Statement of Revenues, Expenses, and Changes in Fund Net Position, and a Statement of Cash Flows for each major proprietary fund. Proprietary funds are accounted for using the "economic resources" measurement focus and the accrual basis of accounting. Accordingly, all assets, deferred inflows/outflows, and liabilities (whether current or non-current) are included on the Statement of Net Position. The Statement of Revenues, Expenses, and Changes in Fund Net Position present increases (revenues) and decreases (expenses) in total Net Position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred. Operating revenues in the proprietary funds are those revenues that are generated from the primary operations of the fund. All other revenues are reported as non- operating revenues. Operating expenses are those expenses that are essential to the primary operations of the fund. All other expenses are reported as non-operating expenses. The internal service funds, which provide services to the other funds of the City, are presented in a single column in the proprietary funds financial statements. Because the principal users of the internal services funds are the City’s governmental activities, the assets and liabilities of the internal service funds are consolidated into the governmental activities column of the government-wide Statement of Net Position. The costs of the internal service fund services are spread to the appropriate function or program on the government-wide Statement of Activities and the revenues and expenses within the internal service funds are eliminated from the government-wide financial statements to avoid any doubling effect of these revenues and expenses. 43 215 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Fiduciary Funds Financial Statements Fiduciary Funds Financial Statements include a Statement of Net Position and a Statement of Changes in Net Position for Custodial and Trust Funds. These statements are presented on an “economic resources” measurement focus and the accrual basis of accounting. The City's fiduciary funds include Custodial and Trust Funds. Custodial Funds report fiduciary activities that are not held in a trust or equivalent arrangement that meets specific criteria. The Custodial Funds present results of operations and include net position. Trust Funds present results of operations and include net position. The Retirement Supplemental Trust Fund accounts for the activities of the Supplemental Retirement Plan for all employees hired prior to 1997, which accumulates resources for pension benefits to qualified employees. Contributions are made to the Supplemental Plan based on the City’s policy to fund the required contributions as determined by the Plan’s actuary and are recognized when they are made. The Retiree Medical Insurance Trust Fund accounts for the activities of the City’s Other Post- Employment Benefits plans, which provide postemployment medical insurance to retirees. The Huntington Beach Redevelopment Successor Agency Private Purpose Trust Fund accounts for the Successor Agency for the former Redevelopment Agency pursuant to Assembly Bill X1 26. Fiduciary funds are not presented in the government-wide financial statements because these funds do not represent net position available to the City. The City reports the following major funds: Governmental Funds General Fund – accounts for activity not required to be accounted for in another fund. Grants Special Revenue – accounts for grant revenues received from federal, state, and local agencies restricted for related project expenditures. LMIHAF Capital Projects – accounts for the activity related to the development of affordable housing. Pension Liability Debt Service – accounts for the City’s contribution to its pension plan obligations, as provided by the voter-approved property tax override and other sources of revenue, including the allocable share from Enterprise Funds and Other Governmental Funds. Infrastructure – accounts for expenditures related to certain designate infrastructure. Proprietary Funds Water Fund – used to account for water sales to customers. 44 216 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Sewer Service Fund – accounts for user fees charged to residents and businesses for sewer service. Refuse Fund – used to account for activities related to refuse collection and disposal. Hazmat Service Fund – accounts for user fees charged for the City’s hazardous waste material program. The City’s fund structure also includes the following fund types: Special Revenue Funds are used to account for and report the proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes other than debt service or capital projects. Debt Service Funds are used to account for and report financial resources that are restricted, committed, or assigned to expenditure for principal and interest. Capital Projects Funds are used to account for and report financial resources that are restricted, committed, or assigned to expenditure for capital outlays, including the acquisition or construction of capital facilities and other capital assets. Internal Service Funds Self Insurance Workers’ Comp Fund – accounts for the City’s self insurance workers’ compensation program in an internal service fund. Self Insurance General Liability Fund – accounts for the City’s self insurance general liability program in an internal service fund. Equipment Replacement Fund – accounts for the City’s equipment replacement needs in an internal service fund. Fiduciary Funds Custodial Funds – are used to account for debt service activities related to the Parking Structure – Bella Terra and Community Facilities District conduit debt issues, in which the City acts as an agent, not as a principal. The Business Improvement District fund is used to account for taxes received and held until disbursement. Pension Trust Fund – Retirement Supplemental Fund - accounts for the City’s supplemental retirement plan. Huntington Beach Redevelopment Successor Agency Private Purpose Trust Fund – accounts for the Successor Agency of the former Redevelopment Agency in accordance with the State’s Dissolution Act. 45 217 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) d. Cash and Investments The City pools cash resources of its various funds to facilitate cash management. Cash in excess of daily needs is invested and reported as investments. It is the City’s intent to hold investments until maturity. However, the City may, in response to market conditions, sell investments prior to maturity in order to improve the quality, liquidity, or yield of the portfolio. Interest earnings are apportioned among funds based on month-end cash and investment balances. The City’s cash and cash equivalents are considered to be cash on hand, demand deposits, and highly liquid investments, such as money market funds, and any investment with a maturity of 90 days or less at the time of purchase. For financial reporting purposes, investments are adjusted to their fair value whenever the difference between fair value and the carrying amount is material. Changes in fair value that occur during the fiscal year are recognized as investments income reported for that fiscal year. Investment income includes interest earnings, changes in fair value and any gains or losses realized upon the liquidation or sale of investments. The City pools all non-restricted cash for investment purchases and allocates interest income to the funds based on month-end cash balances. Funds that have restricted cash record interest income in the respective fund. e. Prepaid Items Certain payments to vendors and individuals reflect costs applicable to a future accounting period and are recorded as prepaid items in both government-wide and fund financial statements. The cost of prepaid items are recorded as expenditures/expenses during the periods benefited. 46 218 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) f. Capital Assets Capital assets are tangible and intangible assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, bridges, sidewalks, and similar items), are reported in the applicable governmental or business-type activities columns in the government-wide financial statements and in the proprietary funds financial statements. Capital assets have an acquisition cost of $50,000 or greater ($100,000 for infrastructure) and a useful life of one year or more. The City records all purchased capital assets at historical cost (where historical records are available) and at estimated historical cost where no historical records exist. The reported value excludes normal maintenance and repairs, which are amounts spent in relation to capital assets that do not increase the asset’s capacity or efficiency or increase its estimated useful life. Donated capital assets are recorded at acquisition value at the date of donation. Acquisition value is the price that would be paid to acquire an asset with equivalent service potential on the date of the donation. Intangible assets follow the same capitalization policies as tangible capital assets and are reported with tangible assets in the appropriate capital asset class. In the government-wide and proprietary funds financial statements, tangible and intangible property, plant, equipment, the right to use leased assets, and infrastructure are depreciated/amortized using the straight-line method over the estimated useful life of the assets as shown below and charged to the respective activity or fund. Land and construction in progress are not depreciated. No depreciation is recorded in the governmental funds of the fund financial statements. Buildings 20 to 50 years Machinery and Equipment 5 to 30 years Infrastructure 50 Years g. Leases The City is a lessee for a noncancellable lease of equipment and property. The City recognizes a lease liability and an intangible right-to-use lease asset (lease asset) in the government-wide financial statements. The City recognizes lease liabilities with an initial, individual value of $50,000 or more. 47 219 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) At the commencement of a lease, the City initially measures the lease liability at the present value of payments expected to be made during the lease term. Subsequently, the lease liability is reduced by the principal portion of lease payments made. The lease asset is initially measured as the initial amount of the lease liability, adjusted for lease payments made at or before the lease commencement date, plus certain initial direct costs. Subsequently, the lease asset is amortized on a straight-line basis over its useful life. Key estimates and judgments related to leases include how the City determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) lease payments. x The City uses the interest rate charged by the lessor as the discount rate. When the interest rate charged by the lessor is not provided, the City generally uses its estimated incremental borrowing rate as the discount rate for leases. x The lease term includes the noncancellable period of the lease. Lease payments included in the measurement of the lease liability are composed of fixed payments and purchase option price that the City is reasonably certain to exercise. The City monitors changes in circumstances that would require a remeasurement of its lease and will remeasure the lease asset and liability if certain changes occur that are expected to significantly affect the amount of the lease liability. Lease assets are reported with other capital assets and lease liabilities are reported with long-term debt on the statement of net position. The City is a lessor for a noncancellable lease of a building, land, and infrastructure. The City recognizes a lease receivable and a deferred inflow of resources in the government-wide and governmental fund financial statements. At the commencement of a lease, the City initially measures the lease receivable at the present value of payments expected to be received during the lease term. Subsequently, the lease receivable is reduced by the principal portion of lease payments received. The deferred inflow of resources is initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date. Subsequently, the deferred inflow of resources is recognized as revenue over the life of the lease term. Key estimates and judgments include how the City determines (1) the discount rate it uses to discount the expected lease receipts to present value, (2) lease term, and (3) lease receipts. 48 220 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) x The City uses its estimated incremental borrowing rate as the discount rate for leases. x The lease term includes the noncancellable period of the lease. Lease receipts included in the measurement of the lease receivable is composed of fixed payments from the lessee. The City monitors changes in circumstances that would require a remeasurement of its lease, and will remeasure the lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the amount of the lease receivable. h. Unearned Revenue In the government-wide and the fund-level financial statements, unearned revenues are those where the asset recognition (availability criteria) has been met, but the revenue recognition criteria have not been met. i. Deferred Outflows/Inflows of Resources In addition to assets, the statement of net position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net assets that applies to future periods and so will not be recognized as an outflow of resources (expense/expenditure) until then. The City reports deferred outflows related to pensions and OPEB which are the result of the implementation of GASB Statement Nos. 68 and 75. In addition to liabilities, the statement of net position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net assets that applies to future periods and so will not be recognized as an inflow of resources (revenue) until that time. The City reported the following in this category: 1. Unavailable revenues (which include revenues, notes, and long-term receivables) measured under the modified accrual basis of accounting reported in governmental funds. These amounts are deferred and will be recognized as an inflow of resources in the period that the amounts become available. 2. Changes in the net pension liability not included in pension expense. 3. Changes in the net other postemployment benefits liability not included in OPEB expense. 4. Lease related deferrals 49 221 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) j. Inventories Proprietary fund inventories are valued at weighted-average cost and consist of expendable supplies and repair parts. The cost of such inventories is recorded as expenditures/expenses when consumed rather than when purchased. k. Interfund Transactions As a general rule, interfund transactions have been eliminated from the government-wide financial statements. Exceptions to this rule are payments in-lieu or charges for current service between the City’s enterprise activities and the City’s governmental activities. Elimination of these transactions would distort the direct costs and program revenues for the various functions. Certain eliminations have been made regarding interfund activities, payables, and receivables. All internal balances in the Statement of Net Position have been eliminated except those representing balances between the governmental activities and the business-type activities, which are presented as internal balances and eliminated in the total primary government column. Numerous transactions occur between funds of the City resulting in transfers and amounts due to or from other funds. Amounts due to or from are the current (due within one year) portion of monies that are to be paid or to be received from other funds. l. Long-Term Obligations In the government-wide and proprietary funds financial statements, long-term obligations are recorded as liabilities in the applicable governmental activities, business-type activities, or proprietary fund-type statement of net position. Bond premiums and discounts are deferred and amortized over the life of the debt. In the governmental fund financial statements, bond discounts and premiums are recognized as another financing source or use. Issuance costs are recorded as a current year debt service expenditure. m. Employee Compensated Absences The City records the cost of all accumulated and unused leave time (vacation, sick, and comp) as a liability when earned in the government-wide and proprietary funds financial statements. In the governmental funds financial statements these amounts are recorded as expenditures when due and payable. 50 222 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) n. Property Tax Revenue Property tax in California is levied according to Article 13-A of the California Constitution. The basic levy is a countywide-levy of one percent of total assessed valuation and is allocated to county governments, school districts, cities and special districts. Additional levies require two-thirds approval by voters and are allocated directly to the specific government. In the government-wide financial statements, property tax is recorded when earned, regardless of when levied, due, or received. City property tax revenues are recognized when levied in the governmental funds to the extent that they result in current receivables collectible within 60 days after year-end. The County acts as a collection agent for property tax for all of the local governmental units. Property taxes are normally collected twice per year. The property tax calendar is as follows: x Lien Date, January 1 - Prior Fiscal Year x Levy Date, July 1 - Levy Fiscal Year x Due Date, First Installment - November 1 x Due Date, Second Installment - February 1 x Delinquent Date, First Installment - December 10 x Delinquent Date, Second Installment - April 10 51 223 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) o. Redevelopment Property Tax Trust Funds Under ABX1 26, revenues that were previously distributed to redevelopment agencies (prior to their dissolution) in the form of property tax increment will no longer be received. Instead, revenues are deposited by County Auditors into Redevelopment Property Tax Trust Funds (RPTTF) created in the County Treasury for each Successor Agency. The County Auditor administers the RPTTF and disburses twice annually from this fund pass-through payments to affected taxing entities, an amount equal to the total of obligation payments that are required to be paid from tax increment as denoted on the Recognized Obligation Payment Schedules (ROPS) to Recognized Obligation Retirement Funds (RORF) established in the treasury of the Successor Agencies, and various allowed administrative fees and allowances. Any remaining balance is then distributed by the County Auditor back to affected taxing entities under a prescribed method that accounts for pass-through payments. The calendar for distribution of RPTTF funds is as follows: x Annual ROPS submission due to Department of Finance, February 1 x Distribution of RPTTF to Successor Agencies for the July-December ROPS period, June 1 x Distribution of RPTTF to Successor Agencies for the January-June ROPS period, January 2 p. Cash Flow Statements For purposes of the Statement of Cash Flows, the Proprietary Funds consider all cash and investments to be cash equivalents, as these funds participate in the citywide cash and investment pool. q. Estimates The accompanying financial statements require management to make estimates and assumptions that affect certain reported amounts and disclosures. Actual results could differ from those estimates. 52 224 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) r. Pensions and OPEB For purposes of measuring the net pension liability, net OPEB liability, related deferred outflows of resources and deferred inflows of resources, pension/OPEB expense, information about the fiduciary net position of the Plan and additions to/deductions from the Plan’s fiduciary net position have been determined on the same basis as they are reported by the CalPERS’ Financial Office and the City’s Defined Benefit Pension Plan. For this purpose, benefit payments (including refunds of employee contributions) are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value. GASB Statement Nos. 68 and 75 require reported results to pertain to liability and asset information within certain defined timeframes. For this report, the following timeframes are used. Supplemental Employee Retirement Plan CalPERS Pension Plans Other Post-Employment Benefit Plan Valuation Date (VD) June 30, 2023 June 30, 2022 June 30, 2023 Measurement Date (MD) June 30, 2024 June 30, 2023 June 30, 2023 Measurement Period (MP) July 1, 2023 to June 30, 2024 July 1, 2022 to June 30, 2023 July 1, 2022 to June 30, 2023 53 225 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) s. Fair Value Measurements Certain assets and liabilities are required to be reported at fair value. The fair value framework provides a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of fair value hierarchy are described as follows: Level 1 - Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets. Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly and fair value is determined through the use of models or other valuation methodologies including: x Quoted prices for similar assets or liabilities in active markets; x Quoted prices for identical or similar assets or liabilities in markets that are inactive; x Inputs other than quoted prices that are observable for the asset or liability; x Inputs that are derived principally from or corroborated by observable market data by correlation or other means. Level 3 - Inputs to the valuation methodology are unobservable and significant to the fair value measurement. These unobservable inputs reflect the City’s own assumptions about the inputs market participants would use in pricing the asset or liability (including assumptions about risk). These unobservable inputs are developed based on the best information available in the circumstances and may include the City’s own data. 54 226 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 2. CASH AND INVESTMENTS Investments Authorized by the California Government Code and the City’s Investment Policy The table below identifies the investment types that are authorized for the City by the California Government Code (or the City’s investment policy, where more restrictive). The table also identifies certain provisions of the California Government Code Section 53601 (or the City’s investment policy, where more restrictive) that address interest rate risk and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustees that are governed by the provisions of debt agreements of the City, rather than the general provisions of the California Government Code or the City’s investment policy. INVESTMENTTYPEMAXIMUMMATURITY MAXIMUMSPECIFIED%OFPORTFOLIO/ MAXIMUMPERISSUER MINIMUMRATING REQUIREMENTS Bankers' Acceptances 180days 25%(upto40%withCouncilapproval)/ 10%A1/P1,"A"Rating Negotiable Certificates of Deposit 3years(Upto5years withCouncilapproval)30%/10% A1/P1,"A"Rating Commercial Paper 270days 25%/10% A1,"A"Rating State Obligations-- CA And Others 5years None/10% "A"Rating City/Local Agency of CA Obligations 5years None/10% "A"Rating U.S. Treasury Obligations 5years None None U.S. Government Agency Obligations 5years None None Supranationals: IBRD, IFC, IDB 5years 30% "AA"Rating Repurchase Agreements 3Months None None Reverse Repurchase Agreements 92days 20%ofthebasevalueoftheportfolio. RequiresCity CouncilApproval None Medium-Term Corporate Notes 5years 30%/10% "A"Rating Non-negotiable Certificates of Deposit 3yearsNone/10% A1/P1,"A"Rating Money Market Mutual Funds 60days 15%/10% "AAA"Rating Local Agency Investment Fund (LAIF)N/A Upto$75,000,000 None Orange County Investment Pool (OCIP)N/A Upto$75,000,000 None Joint Powers Authority N/A None/$75,000,000 See10.0NofIPS 55 227 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 2. CASH AND INVESTMENTS (Continued) Investments Authorized by Debt Agreements Investments of debt proceeds held by bond trustee are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City’s investment policy. The table below identifies the investment types that are authorized for investments held by a bond trustee, but bond indentures do allow for other forms of investments if approved in writing by the bond insurer that are not identified below. The table also identifies certain provisions of these debt agreements that address interest rate risk and concentration of credit risk. AuthorizedInvestment Type MaximumMaturity MaximumPercentage ofPortfolio MaximumInvestment inOneIssuer U.S. Treasury Securities 5 Years No Limit No Limit Federal Agency Securities 5 Years No Limit No Limit Bankers' Acceptances 180 Days No Limit No Limit Time CDs 360 Days No Limit No Limit Negotiable CDs 360 Days No Limit No Limit LAIF N/A No Limit No Limit Commercial Paper 270 Days No Limit No Limit Municipal Bonds from Any State Life of Bond No Limit No Limit Money Market Funds N/A No Limit No Limit Investment Agreements Life of Bond No Limit No Limit Corporate Bonds 5 Years No Limit No Limit California Asset Mgmt. Program N/A No Limit No Limit Forward Purchase/Delivery Agreements Life of Bond No Limit No Limit 56 228 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 2. CASH AND INVESTMENTS (Continued) Investment of the Pension Trust Fund – Retirement Supplemental Fund The Investment Policy Statement (IPS) of the Huntington Beach Supplemental Pension Trust is established in accordance with the assignment of fiduciary duties by the State of California Constitution and State and Local Government Codes. The purpose of the Investment Policy is to set guidelines for a prudent investment-making process. The policy was established with the assumption that the longer-term nature of the portfolio provides for higher risk tolerance and short-term volatility, but more potential for capital growth. The Investment Manager will be responsible for carrying out the activities related to the portfolio in accordance with the IPS to meet the goals of an agreed upon risk/return profile, and in accordance with the mix of parameters outlined below: AuthorizedInvestment Type Minimum Allocation TargetAsset Allocation Maximum Allocation Cash orEquivalents 0%0%10% Money Market 0%0%10% Fixed Income 33% 43% 53% Intermediate Bond 33%43%53% Short-Term Bond 0%0%10% Long-Term Bond 0%0%10% High Yield Bond 0%0%10% Inflation Protected Bond 0%0%10% World Bond 0%0%10% DomesticEquity 19% 29% 39% Large Cap Equity (Value, Blend, Growth)10% 20% 30% Mid Cap Equity (Value, Blend, Growth)0%6%16% Small Cap Equity (Value, Blend, Growth)0%3%13% Foreign Equity 14% 24% 34% Foreign Large Equity (Value, Blend, Growth)9% 19% 29% Foreign Sm / Mid Equity (Value, Growth)0% 0% 10% Emerging Markets 0%5%15% RealEstate 0% 2% 12% Real Estate 0%2%12% Commodities 0%2%12% Natural Resources 0%2%12% 57 229 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 2. CASH AND INVESTMENTS (Continued) At year-end, the City had the following deposits and investments (amounts in thousands): 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, the greater the sensitivity of its fair value is to changes in market interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of shorter term and longer term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time as necessary to provide the cash flow and liquidity needed for operations. Information about the sensitivity of the fair values of the City’s investments, including investments held by bond trustees, to market interest rate fluctuations is provided by the following table that shows the distribution of the City’s investments by maturity (in thousands). Primary Government: Cash and Investments 411,374$ Cash and Investments with Fiscal Agent 3,581 Total Primary Government 414,955 Fiduciary Funds: Cash and Investments 11,135 Cash and Investments with Fiscal Agent 72,255 Total Fiduciary Funds 83,390 Total Deposits and Investments 498,345$ INVESTMENTS: Fair Value Less than 1 1 to 3 3 to 5 Total US Treasuries 90,539$ 36,803$ 39,094$ 14,642$ 90,539$ US Agency Securities*159,594 55,523 84,507 19,564 159,594 Mutual Funds 65,477 65,477 - - 65,477 Money Market Funds 14,737 14,737 - - 14,737 Medium Term Notes - IADB 48,681 4,968 14,126 29,587 48,681 Corporate Bonds 50,093 8,749 36,339 5,005 50,093 California Asset Mgmt Program 36,586 36,586 - - 36,586 PARS Pension Rate Stabilization Program 20,212 20,212 - - 20,212 Total Investments 485,919$ 243,055$ 174,066$ 68,798$ 485,919 Total Deposits 12,426 Total Deposits and Investments 498,345$ * Security is callable, but classified above according to original maturity date Investment Maturities (In Years) 58 230 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 2. CASH AND INVESTMENTS (Continued) Disclosures Relating to Credit Risk Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below are the minimum ratings required by, where applicable, the California Government Code or the City’s investment policy, or debt agreements, and the actual rating as of the year-end for each investment type (in thousands): Concentration of Credit Risk The City’s investment policy limits investments in any one issuer, except for U.S. Treasury Securities, U.S. Government Agencies and the Local Agency Investment Fund, to no more than 10% of the portfolio. In addition, no more than 50% can be invested in a single security type or with a single financial institution and every security type has a specific limit. This is in addition to the limits placed on investments by State law. Investments in any one issuer (other than U.S. Treasury Securities, external investment pools, or Money Market Funds) that represent 5% or more of the City’s total investments are as follows (in thousands): Remaining as of Year End INVESTMENTS: Minimum Legal Rating Total AAA AA A Not Rated US Treasuries N/A 90,539$ 90,539$ -$ -$ -$ US Agency Securities*N/A 159,594 159,594 - - - Mutual Funds N/A 65,477 - - - 65,477 Money Market Funds AAA 14,737 14,737 - - - Medium Term Notes - IADB AA 48,681 48,681 - - - Corporate Bonds A 50,093 - 13,743 36,350 - California Asset Mgmt Program N/A 36,586 36,586 - - - PARS Pension Rate Stabilization Program N/A 20,212 - - - 20,212 Total Investments 485,919$ 350,137$ 13,743$ 36,350$ 85,689$ Note: All US Agencies are rated AAA by Moody's and AA by S&P Fair Value Issuer Investment Type Amount Federal Home Loan Bank U.S. Government Sponsored Enterprise Securities 119,259$ Int'l Bank for Recon & Development Supernational 33,753$ U.S. Treasury Notes Obligations of the United States Treasury 78,540$ 59 231 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 2. CASH AND INVESTMENTS (Continued) 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’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provisions 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 fair 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. As of June 30, 2024, the City’s deposits with financial institutions were covered by FDIC up to $250,000, and the remaining amounts were collateralized as described above. None of the City’s investments were subject to custodial credit risk. Per the Investment Policy’s statement, the City of Huntington Beach is the registered owner of all investments in the portfolio. Investment in California Asset Management Program Pool The City is a voluntary participant in the California Asset Management Program (CAMP). CAMP is an investment pool offered by the California Asset Management Trust (the Trust). The Trust is a joint powers authority and public agency created by the Declaration of Trust and established under the provisions of the California Joint Exercise of Powers Act (California Government Code Sections 6500 et seq., or the “Act”) for the purpose of exercising the common power of its Participants to invest certain proceeds of debt issues and surplus funds. The Trust’s activities are directed by a Board of Trustees, all of whom are employees of the California public agencies which are participants in the Trust. The City reports investments in CAMP at the fair value amounts provided by CAMP, which is the same as the value of the pool share. The Pool is managed to maintain a dollar-weighted average portfolio maturity of 60 days or less and seeks to maintain a constant net asset value (NAV) per share of $1.00. The Pool invests in obligations of the United States Government and its agencies, high- quality, short-term debt obligations of U.S. companies and financial institutions. The Pool is a permitted investment for all local agencies under California Government Code Section 53601(p). 60 232 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 2. CASH AND INVESTMENTS (Continued) Investment in Public Agency Retirement Services Pension Rate Stabilization Program The City established a Section 115 pension trust account within the Public Agency Retirement Services Pension Rate Stabilization Program (PARS PRSP) to hold assets that are legally restricted for use in administering the City’s defined benefit pension plan. The pension trust fund’s specific cash and investments are managed by a third- party portfolio manager under guidelines approved by the City. Fair Value Measurement The City categorizes its fair value investments within the fair value hierarchy established by generally accepted accounting principles. The City has the following recurring fair value measurements as of June 30, 2024 (in thousands): 3. OTHER RECEIVABLES A summary of Other Receivables as of June 30, 2024 is as follows (in thousands): INVESTMENTS: Level 1 Level 2 Level 3 Total U.S. Treasuries -$ 90,539$ -$ $ 90,539 U.S. Agency Securities - 159,594 - 159,594 Mutual Funds 65,477 - - 65,477 Medium Term Notes - IADB - 48,681 - 48,681 Corporate Bonds - 50,093 - 50,093 Total Investments 65,477$ 348,907$ -$ 414,384$ Fair Value Hierarchy FY2023-24 Description Amount Developer Loans Receivable 40,762$ Emerald Cove Loan Receivable 6,376 Housing Rehabilitation Loans Receivable 1,894 First Time Homebuyers Receivable 1,630 Emergency Medical Fee Receivable 2,509 CDBG Program Receivable 663 Waterfront Receivable 6,227 Other Grants Receivable 7,360 Other Receivable 8,854 Total Other Receivables 76,275 Allowance for Uncollectible Developer Loans (40,762) Net Other Receivables on Governmental Fund Financial Statements 35,513$ Other Receivables Reconciliation Net Receivable on Government-wide Financial Statements 52,886$ Taxes Receivable on Governmental Fund Financial Statements (15,981) Other Receivables on Internal Service Fund (1,392) Net Other Receivables on Governmental Fund Financial Statements 35,513$ 61 233 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 3. OTHER RECEIVABLES (Continued) a. Developer Loans Loans made to developers to construct or rehabilitate certain facilities under deferred loan agreements total $40,762,000 at year-end. These loans are allowed until a future event occurs. Loans to the Low and Moderate Income Housing Asset Fund total $20,670,000, loans made under the Home Program total $17,768,000 and loans made under the Affordable Housing In-Lieu Program total $2,324,000. Interest rates on these loans range from 0% to 10%. The allowance for uncollectible developer loans is $40,762,000 due to the terms of the agreement to forgive the balance of loans after a specified time period if all the conditions of loan forgiveness are met. b. Emerald Cove Loan On June 15, 2010, the former Redevelopment Agency loaned Emerald Cove, LP $8,000,000 to acquire and rehabilitate Emerald Cove Senior Apartments. The loan has an interest rate of 3% and is to be repaid annually from residual receipts over 60 years. The loan was transferred to the Low and Moderate Income Housing Asset Fund in Fiscal Year 2011/12. The loan balance as of June 30, 2024 is $6,376,000. c. Housing Rehabilitation Loans Loans made to qualified homeowners and landlords in the City of Huntington Beach to rehabilitate certain single-family homes or multifamily rental housing under deferred loan agreements total $1,894,000 at year-end. These loans are deferred until a future event occurs. The interest rates on these loans range from 0% to 6%. d. Deferred Loans – First Time Homebuyers and Down Payment Assistance Loans made for down payment assistance of qualified first time homebuyers under deferred loan agreements total $1,630,000 at year-end. These loans are deferred until a future event occurs. 62 234 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 4. UNEARNED REVENUE Governmental and enterprise funds defer revenue recognition in connection with resources that have been received as of year-end, but not yet earned (unearned revenue). The amounts are as follows (in thousands): 5. UNAVAILABLE REVENUE Certain revenues in governmental funds are considered unavailable revenue until received. All revenues including property and sales tax are recognized in the year earned or levied in the government-wide financial statements but are recorded as unavailable revenue in the fund financial statements to the extent they are not collected within 60 days after year-end. The amounts are as follows (in thousands): Deferred Loans to developers and qualified individuals for housing rehabilitation and to first time homebuyers are discussed in Note 3. General Fund Grants Special Revenue Total Unearned Revenue Community Services Unearned Revenue (Classes)1,228$ -$ 1,228$ Public Works - Unearned Revenue 44 - 44 Grants - 2,502 2,502 Total $ 1,272 $ 2,502 $ 3,774 General Fund Grants Special Revenue LMIHAF Other Governmental Funds Total Unavailable Revenue Grants -$ 7,206$ -$ -$ 7,206$ Deferred Loans: Emerald Cove - - 6,376 - 6,376 Housing Rehabilitation - 1,849 - - 1,849 First Time Homebuyers - - 1,630 - 1,630 Waterfront 24,909 - 6,227 - 31,136 Other Unavailable Revenue 721 - - 82 803 Total 25,630$ 9,055$ 14,233$ 82$ 49,000$ 63 235 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 6. RETIREMENT PLAN – NORMAL a. Summary Net Pension Liability/(Asset) Net Pension Liability/(Asset) is reported in the accompanying statement of net position as follows: Deferred Outflows of Resources Deferred Outflows of Resources are reported in the accompanying statement of net position as follows: Deferred Inflows of Resources Deferred Inflows of Resources are reported in the accompanying statement of net position as follows: Net Pension Liability/(Asset) CalPERS Miscellaneous Plan 72,908$ CalPERS Safety Plan 116,324 Supplemental Plan (Note 7)4,219 Total 193,451$ Change to Net Deferred employer Difference Between Differences between pension contributions Projected and Actual Changes Expected and made after Investment Earnings in assumptions Actual Experience measurement date Total CalPERS Miscellaneous Plan 33,665$ 3,304$ 3,231$ 5,808$ 46,008$ CalPERS Safety Plan 47,079 14,743 10,074 11,484 83,380 Total 80,744$ 18,047$ 13,305$ 17,292$ 129,388$ Change to Net Difference Between Differences between Projected and Actual Expected and Investment Earnings Actual Experience Total CalPERS Safety Plan -$ 896$ 896$ Supplemental Plan (Note 7)85 - 85 Total 85$ 896$ 981$ 64 236 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 6. RETIREMENT PLAN – NORMAL (Continued) Pension expenses for the measurement period ending June 30, 2023 (the measurement date), are included in the accompanying financial statements as follows: b. Plan Description Substantially all City employees working the equivalent of 1,000 hours per fiscal year are eligible to participate in the Safety Plan and Miscellaneous Plan Agent multiple-employer defined benefit plans administered by California Public Employees Retirement System (CalPERS), which acts as a common investment and administrative agent for its participating member employers. Benefit Provisions under the Plans are established by State statutes within the Public Employee’s Retirement Law. Following the passage of AB340, Public Employees’ Pension Reform Act (PEPRA) by the California Legislature, employees hired on or after January 1, 2013, who were not previously enrolled in the PERS system elsewhere, or who have had a break in service of at least six months are required to be enrolled in this retirement program which provides a benefit level that is lower than the benefits provided for CalPERS employees that do not meet the PEPRA qualifications previously described. CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website. Copies of the CalPERS annual financial report may be obtained from the CalPERS Executive Office – 400 P Street, Sacramento, CA 95814. Net Pension Expense/(Income) CalPERS Miscellaneous Plan 29,232$ CalPERS Safety Plan 38,403 Supplemental Plan (Note 7)206 Total 67,841$ 65 237 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 6. RETIREMENT PLAN – NORMAL (Continued) Benefits Provided CalPERS provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. Benefits are based on years of credited service, equal to one year of full time employment. Benefit provisions and all other requirements are established by State statute and may be amended by city contracts with employee bargaining groups. Participant is eligible for non-industrial disability retirement if becomes disabled and has at least 5 years of credited service. There is no special age requirement. The standard non-industrial disability retirement benefit is a monthly allowance equal to 1.8 percent of final compensation, multiplied by service. Industrial disability benefits are not offered to miscellaneous employees. The City provides industrial disability retirement benefit to safety employees. The industrial disability retirement benefit is a monthly allowance equal to 50 percent of final compensation. An employee's beneficiary may receive the basic death benefit if the employee dies while actively employed. The employee must be actively employed with the City to be eligible for this benefit. An employee's survivor who is eligible for any other pre- retirement death benefit may choose to receive that death benefit instead of this basic death benefit. The basic death benefit is a lump sum in the amount of the employee's accumulated contributions, where interest is currently credited at 7.5 percent per year, plus a lump sum in the amount of one month's salary for each completed year of current service, up to a maximum of six months' salary. For purposes of this benefit, one month's salary is defined as the member's average monthly full-time rate of compensation during the 12 months preceding death. Upon the death of a retiree, a one-time lump sum payment of $500 will be made to the retiree's designated survivor(s), or to the retiree's estate. Benefit terms provide for annual cost-of-living adjustments to each employee’s retirement allowance. Beginning the second calendar year after the year of retirement, retirement and survivor allowances will be annually adjusted on a compound basis by 2 percent. 66 238 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 6. RETIREMENT PLAN – NORMAL (Continued) The Plans’ provisions and benefits in effect at June 30, 2024 are summarized as follows: Classic PEPRA Hire date Prior to January 1, 2013 January 1, 2013 and after Benefit formula 2.5% @ 55 2% @ 62 Benefit vesting schedule 5 years of service 5 years of service Benefit payments monthly for life monthly for life Retirement age minimum 50 years minimum 52 years Monthly benefits, as a % of eligible compensation 2.0% - 2.5%, 50 years - 63+ years, respectively 1.0% - 2.5%, 52 years - 67+ years, respectively Required employee contribution rates 8.000% 6.250% Required employer contribution rates July 1, 2023 - June 30, 2024 11.220% 11.220% Classic PEPRA Hire date Prior to January 1, 2013 January 1, 2013 and after Benefit formula 3% @ 50 2.7% @ 57 Benefit vesting schedule 5 years of service 5 years of service Benefit payments monthly for life monthly for life Retirement age minimum 50 years minimum 52 years Monthly benefits, as a % of eligible compensation 3%, 50+ years 2.0% - 2.7%, 50 years - 57+ years, respectively Required employee contribution rates 9.000%11.75%/13.00% (Fire PEPRA) Required employer contribution rates July 1, 2023 - June 30, 2024 22.330%22.330% Miscellaneous Agent Plans Safety Agent Plans 67 239 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 6. RETIREMENT PLAN – NORMAL (Continued) c. Contributions Section 20814(c) of the California Public Employees’ Retirement Law (“PERL”) requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The employer is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. For the measurement period ended June 30, 2023, miscellaneous participants under the Classic and PEPRA plans are required to contribute 8% and 6.25% of their annual covered salary, respectively. Safety participants under the Classic and PEPRA plans are required to contribute 9% and 11.75% of their annual covered salary, respectively. Fire PEPRA participants are now required to contribute 13%. In addition, the City is required to make employer contributions at the actuarially determined rates of 11.220% and 22.330% for the miscellaneous and safety plans, respectively, for the period July 1, 2023 through June 30, 2024. At June 30, 2023, the valuation date, the following employees were covered by the benefit terms for each Plan: Miscellaneous Safety Active members 618 370 Transferred members 506 78 Terminated members 397 90 Retired members and beneficiaries 1110 677 68 240 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 6. RETIREMENT PLAN – NORMAL (Continued) d. Net Pension Liability The City’s net pension liability is measured as the total pension liability, less the pension plan’s fiduciary net position. The net pension liability of the Plan is measured as of June 30, 2023, using an annual actuarial valuation as of June 30, 2022 rolled forward to June 30, 2023 using standard update procedures. A summary of principal assumptions and methods used to determine the net pension liability is illustrated below: Actuarial Assumptions – The total pension liability in the June 30, 2023 actuarial valuation, rolled forward to June 30, 2024 using standard update procedures, were determined using the following actuarial assumptions: Actuarial Methods and Assumptions Used to Determine Total Pension Liability Actuarial Cost Method Entry Age Actuarial Cost Method Actuarial Assumptions: Discount Rate Inflation Salary Increases Investment Rate of Return Mortality Rate Table* Post Retirement Benefit Increase *The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2021 CalPERS Experience Study for the period from 2001 to 2019. Pre-retirement and Post-retirement mortality rates include generational mortality improvement using 80% of Scale MP-2020 published by the Society of Actuaries. For more details on this table, please refer to the CalPERS Experience Study and Review of Actuarial Assumptions report from November 2021 that can be found on the CalPERS website. 6.90% Net of Pension Plan Investment and Administrative Expenses; includes Inflation Derived using CalPERS’ membership data for all funds The lesser of contract COLA or 2.30% until Purchasing Power Protection Allowance floor on purchasing power applies, 2.30% thereafter 6.90% 2.30% Varies by entry age and service 69 241 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 6. RETIREMENT PLAN – NORMAL (Continued) Long-term Expected Rate of Return – The long-term expected rate of return on pension plan investments was determined using a building-block method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectations as well as the expected pension fund cash flows. Using historical returns of all of the funds’ asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11+ years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equal to the single equivalent rate calculated above and adjusted to account for assumed administrative expenses. The expected real rates of return by asset class are as follows: Assumed asset Asset Class1 Allocation Real Return1,2 Global Equity - Cap-weighted 30.00%4.54% Global Equity - Non-Cap-weighted 12.00%3.84% Private Equity 13.00%7.28% Treasury 5.00%0.27% Mortgage-backed Securities 5.00%0.50% Investment Grade Corporates 10.00%1.56% High Yield 5.00%2.27% Emerging Market Debt 5.00%2.48% Private Debt 5.00%3.57% Real Assets 15.00%3.21% Leverage (5.00)%(0.59)% 1 An expected inflation of 2.30% used for this period. 2 Figures are based on the 2021 Asset Liability Management study. 70 242 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 6. RETIREMENT PLAN – NORMAL (Continued) Discount Rate – The discount rate used to measure the total pension liability was 6.90%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Subsequent Events – There were no subsequent events that would materially affect the results presented in this disclosure. e. Changes in the Net Pension Liability/(Asset) The following table shows the changes in net pension liability/(asset) recognized over the measurement period: Total Pension Liability Plan Fiduciary Net Position Net Pension Liability (Asset) Balance at June 30, 2022 (Valuation Date)656,726$ 596,848$ 59,878$ Changes in the year: Service cost 9,167 - 9,167 Interest on the total pension liabilities 44,775 - 44,775 Changes of Benefit Terms 658 - 658 Differences between expected and actual experience 5,260 - 5,260 Benefit payments, including refunds of members contributions (36,634) (36,634) - Plan to Plan Resource Movement - 1 (1) Contributions - employer - 7,450 (7,450) Contributions - employee - 3,741 (3,741) Net investment income - 36,077 (36,077) Administrative expenses - (439) 439 Net changes 23,226 10,196 13,030 Balance at June 30, 2023 (Measurement Date) 679,952$ 607,044$ 72,908$ Total Pension Liability Plan Fiduciary Net Position Net Pension Liability (Asset) Balance at June 30, 2022 (Valuation Date)881,003$ 788,911$ 92,092$ Changes in the year: Service cost 15,176 - 15,176 Interest on the total pension liabilities 60,569 - 60,569 Changes of Benefit Terms 374 - 374 Differences between expected and actual experience 13,601 - 13,601 Plan to Plan Resource Movement - (1) 1 Benefit payments, including refunds of members contributions (49,495) (49,495) - Contributions - employer - 13,219 (13,219) Contributions - employee - 4,949 (4,949) Net investment income - 47,901 (47,901) Administrative expenses - (580) 580 Net changes 40,225 15,993 24,232 Balance at June 30, 2023 (Measurement Date) 921,228$ 804,904$ 116,324$ Miscellaneous Plan Safety Plan 71 243 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 6. RETIREMENT PLAN – NORMAL (Continued) Sensitivity of the Net Pension Liability/(Asset) to Changes in the Discount Rate - The following presents the City’s net pension liability, calculated using the discount rate, as well as what the City’s net pension liability would be if it were calculated using a discount rate that is one percentage point lower or one percentage point higher than the current rate: Pension Plan Fiduciary Net Position – Detailed information about each pension plan’s fiduciary net position is available in the separately issued CalPERS financial reports. Pension Income and Deferred Outflows/Inflows of Resources Related to Pensions As of the start of the measurement period (July 1, 2022), the net pension liability was $59,878,000 for the Miscellaneous Plan and $92,092,000 for the Safety Plan. For the measurement period ending June 30, 2023 (the measurement date), the City incurred a pension expense of $29,232,000 and $38,403,000 for the Miscellaneous and Safety Plans, respectively. The amortization period differs depending on the source of the gain or loss. The difference between projected and actual earnings is amortized over 5-years straight line. All other amounts are amortized straight-line over the average expected remaining service lives of all members that are provided with benefits (active, inactive and retired) as of the beginning of the measurement period. Discount Rate - 1% Current Discount Discount Rate + 1% (5.90%)Rate (6.90%)(7.90%) Miscellaneous Plan 161,070$ 72,908$ 468$ Safety Plan 239,094 116,324 15,885 Aggregate Total 400,164$ 189,232$ 16,353$ Plan's Aggregate Net Pension Liability/(Asset) 72 244 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 6. RETIREMENT PLAN – NORMAL (Continued) The Expected Average Remaining Service Lifetime (“EARSL”) is calculated by dividing the total future service years of active employees by the total number of plan participants (active, inactive, and retired) in the risk pool. For the 2022-23 measurement period, the EARSL for each plan is as follows: At June 30, 2024 the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Miscellaneous Safety Expected Average Remaining Service Lifetime 2.5 3.8 Deferred outflows Deferred inflows of Resources of Resources Difference between projected and actual earning on pension plan investments 33,665$ -$ Changes in assumptions 3,304 - Difference between expected and actual experience 3,231 - Contributions made subsequent to the measurement date 5,808 - Total 46,008$ -$ Deferred outflows Deferred inflows of Resources of Resources Difference between projected and actual earning on pension plan investments 47,079$ -$ Changes in assumptions 14,743 - Difference between expected and actual experience 10,074 (896) Contributions made subsequent to the measurement date 11,484 - Total 83,380$ (896)$ Miscellaneous Plan Safety Plan 73 245 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 6. RETIREMENT PLAN – NORMAL (Continued) For the Miscellaneous Plan and Safety Plan, $5,808,000 and $11,484,000, respectively, was reported as deferred outflows of resources related to pensions resulting from City’s contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2024. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: 7. RETIREMENT PLAN – SUPPLEMENTAL a. Plan Description and Benefits The City administers a supplemental single-employer defined benefit retirement plan (Supplemental Plan) for all employees hired prior to 1997 (exact dates are different for various associations). The Plan is governed by a three-member Supplemental Employee Retirement Plan and Trust Board consisting of the City Treasurer, Chief Financial Officer, and the City Manager, or his/her designee. The Board has the authority, under the terms of the Trust agreement, to control and manage the operation and administration of the Plan. Benefit provisions are established and may be amended through negotiations between the City and employee bargaining associations during each bargaining period, which are then approved through resolutions of the City Council. In Fiscal Year 2008/09, the City established the Supplemental Employee Retirement Plan and Trust, and transferred $24,918,000 to an irrevocable trust from the prefunded amounts. The plan and trust are reported as a pension trust fund in the City’s financial statements on a full accrual basis. Measurement Periods Ended June 30,Miscellaneous Safety 2024 12,857$ 20,685$ 2025 6,632 19,409 2026 19,881 29,823 2027 830 1,083 40,200$ 71,000$ Deferred Outflows / (Inflows) of Resources 74 246 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 7. RETIREMENT PLAN – SUPPLEMENTAL (Continued) The Supplemental Plan will pay the retiree an additional amount to his or her CalPERS retirement benefit for life. In order to be eligible for the benefit, the retiree must retire from the City. The amount that is computed as a factor of an employee’s normal retirement allowance is computed at retirement and remains constant for his or her life. This benefit is payable by the City for the duration of the life of the member, and shall cease upon the employee’s death. As of June 30, 2023, the date of the Plan’s most recent actuarial valuation, the average monthly benefit received by inactive plan members and beneficiaries receiving benefits is $655. Effective in 1998 (exact dates are different for various associations), new City employees are ineligible to participate in the Supplemental Employee Retirement Plan. Employees Covered: At June 30, 2024, the measurement date, the following employees were covered by the benefit terms for the Plan: b. Employer Contributions The City’s policy is to make required contributions as determined by the Supplemental Plan’s actuary. The required contributions were determined as part of the June 30, 2023 actuarial valuation. The City is required to contribute the actuarially determined rate of 3.6% of total payroll for all permanent employees for the year ended June 30, 2023. There are no employee contributions required for the plan. Survivor and termination benefits are not included in the plan. Administrative costs of this plan are financed through investment earnings. For the year ended June 30, 2024, the contributions were (in thousands): Contributions - employer 1,422$ Inactive employees receiving benefits 728 Active employees 44 Total 772 75 247 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 7. RETIREMENT PLAN – SUPPLEMENTAL (Continued) c. Investments Investments of the Supplemental Plan are held separately from those of other City funds by investment custodians. The Supplemental Employee Retirement Plan and Trust Board is responsible for supervising all investments. Changes to the Investment Policy require approval by the Board. The policy remained the same as last fiscal year. The most recent policy was reviewed in June 2022 with an effective date of July 1, 2022. Please refer to Note 2 for a detailed description of the Supplemental Plan’s Investment Policy. The major asset class allocation for the Supplemental Plan as of June 30, 2024 is listed below: Quoted market prices have been used to value investments as of June 30, 2024. These investments are held by the Trust or by an agent in the Trust’s name. A portion of these investments is subject to credit risk (including custodial credit risk and concentrations of credit risk), interest rate risk and/or foreign currency risk. The Governmental Accounting Standards Board (GASB) Statement No. 40 requires the disclosure of such risk. Please see below for a list of investments held in any one organization that represents five percent or more of the Plan’s investment portfolio at June 30, 2024: Asset Class Strategic Allocation Allocation as of June 30,2024 Long-Term Expected Rate of Return Fixed Income 43.00% 41.31% 3.95% Equities 53.00% 57.70% 8.78% Real Estate 2.00% 0.00% 9.36% Commodities 2.00% 0.00% 5.31% Cash and Equivalents 0.00% 0.99% 2.90% Total 100.00% 100.00% Fidelity 500 Index Fund 19.73% Fidelity Emerging Markets Index Fund 5.04% Vanguard FTSE 19.18% Baird Aggregate Bond Fd Instl 9.56% Dodge Cox Income 5.74% Fidelity US Bond Index 22.96% Concentration of Investments Equaling or Exceeding 5% 76 248 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 7. RETIREMENT PLAN – SUPPLEMENTAL (Continued) All Supplemental Plan investments are reflected in the schedule included in Section c of the Note, with the exception of amounts held in the City’s investment pool account. The City maintains an investment pool account for City funds. Monthly contributions for the Plan are held in the City’s investment pool account and are used to pay recurring expenditures. Refer to Note 2 for a description of the City’s investments. For the Fiscal Year ended June 30, 2024, the annual money-weighted rate of return on the Plan’s investments, net of pension plan investment expenses, was 11.10%. The money-weighted rate of return expresses investment performance, net of investment expenses, adjusted for the changing amounts actually invested. d. Net Pension Liability The City’s net pension liability is measured as the total pension liability, less the pension plan’s fiduciary net position. The net pension liability of the Plan is measured as of June 30, 2024, using an annual actuarial valuation as of June 30, 2022 rolled forward to June 30, 2024 using standard update procedures. A summary of principal assumptions and methods used to determine the City’s net pension liability is shown on the following page. 77 249 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 7. RETIREMENT PLAN – SUPPLEMENTAL (Continued) Actuarial Assumptions – The total pension liabilities in the June 30, 2023 actuarial valuations for the June 30, 2024 measurement date were determined using the following actuarial assumptions: The changes in actuarial assumptions include the following: All other actuarial assumptions used in the June 30, 2023 valuation were based on the results of an actuarial experience study for the period from 2000 to 2019, including updates to salary increase, mortality, and retirement rates. The future service retirement liabilities load increased from 15% to 23% to reflect recent experience of benefits being larger than anticipated. e. Discount Rate & Sensitivity The discount rate is used in the measurement of the Total Pension Liability. This rate considers the ability of the fund to meet benefit obligations in the future. To make this determination, employee contributions, benefit payments, expenses, and investment returns are projected into the future. The Plan Net Position (assets) in future years can then be determined and compared to its obligation to make benefit payments in those years. As long as assets are projected to be on hand in a future year, the assumed valuation discount is used. For this valuation, the discount rate is 5.75%, based on the inflation assumption of 2.50% and a long-term asset allocation of 70% equities and 30% fixed income. Actuarial Methods and Assumptions Used to Determine Total Pension Liability Actuarial Cost Method Entry Age Normal, Level Percentage of Payroll Actuarial Assumptions: Discount Rate 5.75% Inflation 2.50% Salary Increases CalPERS 2000-2019 Experience Study plus 2.75% aggregate increase Investment Rate of Return 5.75% Net of Investment Expenses Mortality Rate Table Retirement, Disability, Withdrawal CalPERS 2000-2019 Experience Study plus 23% load on future service retirement liability added to reflect recent benefits experience. CalPERS 2000-2019 Experience Study, mortality projected fully generational with Scale MP-2021 78 250 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 7. RETIREMENT PLAN – SUPPLEMENTAL (Continued) According to Paragraph 30 of Statement 68, the long-term discount rate should be determined without reduction for pension plan administrative expense. An investment return excluding administrative expenses would have been 5.50 percent. The long-term expected rate of return on pension plan investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. In determining the long-term expected rate of return, both short-term and long-term market return expectations were taken into account along with expected pension fund cash flows. Such cash flows were developed assuming that both members and employers will make their required contributions on time and as scheduled in all future years. Using historical returns of all the funds’ asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11-60 years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equivalent to the single equivalent rate calculated above and rounded down to the nearest one quarter of one percent. 79 251 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 7. RETIREMENT PLAN – SUPPLEMENTAL (Continued) Changes in the Net Pension Liability The following table shows the changes in net pension liability recognized over the measurement period (in thousands): Sensitivity of the Net Pension Liability to Changes in the Discount Rate - The following presents the City’s net pension liability, calculated using the discount rate, as well as what the City’s net pension liability would be if it were calculated using a discount rate that is one percentage point lower or one percentage point higher than the current rate: Total Pension Liability Plan Fiduciary Net Position Net Pension Liability Balance at June 30, 2023 72,610$ 63,822$ 8,788$ Changes in the year: Service cost 203 - 203 Interest on the total pension liabilities 3,848 - 3,848 Differences between expected and actual experience 781 - 781 Changes of Assumptions (1,375) - (1,375) Benefit payments, including refunds of members contributions (5,711) (5,711) - Contributions - employer - 1,422 (1,422) Net investment income - 6,954 (6,954) Administrative expenses - (350) 350 Net changes (2,254) 2,315 (4,569) Balance at June 30, 2024 70,356$ 66,137$ 4,219$ Supplemental Plan Discount Rate - 1% (4.75%) Current Discount Rate (5.75%) Discount Rate + 1% (6.75%) 10,781$ 4,219$ (1,412)$ Plan's Aggregate Net Pension Liability/(Asset) (in thousands) 80 252 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 7. RETIREMENT PLAN – SUPPLEMENTAL (Continued) f. Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions For the year ended June 30, 2024, the City recognized pension expense in the amount of $206,000 for the Supplemental Plan. At June 30, 2024, the City reported deferred inflows of resources related to the supplemental pension plan from the following source (in thousands): For the Supplemental Plan, $85,000 was reported as deferred inflows of resources related to pensions which will be recognized in pension expense as follows (in thousands): Deferred Inflows of Resources Difference between projected and actual earnings on pension plan investments 85$ Deferred Outflows/ (Inflows) of Year Ended June 30,of Resources 2025 (401)$ 2026 2,007 2027 (1,003) 2028 (688) (85)$ 81 253 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 8. OTHER POST EMPLOYMENT BENEFITS a. Plan Description The City administers the following two other post employment benefit (OPEB) plans: Postemployment Medical Insurance The City agreed, via contract, with each employee association to provide postemployment medical insurance to retirees. These Other Postemployment Benefits (OPEB) are based on years of service and are available to all retirees who meet all three of the following criteria: x At the time of retirement, the employee is employed by the City. x At the time of retirement, the employee has a minimum of ten years of service credit or is granted a service connected disability retirement. x Following official separation from the City, CalPERS grants a retirement allowance. The City’s obligation to provide the benefits to a retiree ceases when either of the following occurs: x During any period the retiree is eligible to receive health insurance at the expense of another employer; and/or x The retiree becomes eligible to enroll automatically or voluntarily in Medicare. The subsidy a retiree is entitled to receive is based on the retiree’s years of service credit and is limited to $344 per month after 25 years of service. If a retiree dies, the benefits that would be payable for his or her insurance are provided to the spouse or family for 12 months. The retiree may use the subsidy for any of the medical insurance plans that the City’s active employees may enroll in. Employees hired on or after October 1, 2014 are not eligible for this benefit. PEMHCA The City provides an agent multiple-employer defined benefit healthcare plan to retirees through CalPERS under the California Public Employees Medical and Hospital Care Act (PEMHCA), commonly referred to as PERS Health. PEMHCA provides health insurance through a variety of Health Maintenance Organization (HMO) and Preferred Provider Organization (PPO) options. The PEMHCA benefits are applied to all safety employee groups, based on retirement plan election. The benefits continue to the surviving spouse for one year. The Huntington Beach Firefighters’ Association (HBFA) joined PEMHCA in 2011. All other safety groups - Fire Management Association (FMA), Marine Safety Management Association (MSOA), Police Management Association (PMA), and Police Officers’ Association (POA) - joined in 2004. 82 254 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 8. OTHER POST EMPLOYMENT BENEFITS (Continued) Safety employees are eligible for PEMHCA benefits if they retire from the City on or after age 50 with at least five years of service or disability, and are eligible for a PERS pension. As of the June 30, 2023 measurement date, the following current and former employees were covered by the benefit terms under the plan: b. Accounting and Funding The City utilizes the California Employers’ Retiree Benefit Trust (CERBT), an agent multiple-employer plan, for the postemployment medical insurance benefit. Benefits paid from the CERBT were $865,000 for year ended June 30, 2024. The assets of the CERBT are excluded from the accompanying financial statements since they are in an irrevocable trust administered by CalPERS. Copies of CalPERS’ annual financial report may be obtained from their executive office: 400 P Street, Sacramento, CA, 95814 or on their website: www.calpers.ca.gov. The City’s policy is to make 100% of each year’s ARC, with an additional amount to prefund benefits as determined annually by City Council in order to improve the funded status of the plan. For PEMHCA, the City selected the “unequal” method for the contribution. Under this method, the City offered a lesser contribution for retirees than for active employees. The City paid the PEMHCA minimum for actives ($143 in 2021, $149 in 2022, $151 in 2023 and $157 in 2024). Beginning in 2008, Assembly Bill 2544 changed the computation for annual increases to annuitant health care under the unequal method. Under the new provisions, the City increases annuitant health care contributions equal to an amount not less than five percent of the active employee contributions, multiplied by the number of years in PEMHCA. The City’s contribution for retirees is $102.05 per employee for the Huntington Beach Firefighter’s Association (HBFA) and $157.00 for all other Safety groups in 2024. The annual increase in minimum PEMHCA contribution to CalPERS will continue until the time that the City contribution for retirees equals the City contribution paid for active employees. Postemployment Medical Insurance PEMHCA Retirees and beneficiaries receiving benefits 284 214 Inactive employees not yet receiving benefits 332 - Active Plan Members 861 374 Total Plan Participants 1,477 588 83 255 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 8. OTHER POST EMPLOYMENT BENEFITS (Continued) The City’s net OPEB liability was measured as of June 30, 2023 and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation dated June 30, 2023, based on the following actuarial methods and assumptions: x Actuarial Cost Method – Entry Age Normal x Discount rate – 5.75% x Projected salary increases for covered employees due to inflation – aggregate increases of 2.75% per annum x Investment Rate of Return – 5.75%, assuming actuarially determined contributions funded into CERBT Investment Strategy 2 x Mortality Rate1 – Derived using CalPERS’ membership data for all funds x Pre-Retirement Turnover2 – Derived using CalPERS’ membership data for all funds x PEMHCA minimum increases for actives - $157 in 2024, with 3.50% annual increases thereafter x Healthcare Trend Rate – The medical trend rate represents the long-term expected growth of medical benefits paid by the plan, due to non-age-related factors such as general medical inflation, utilization, new technology, and the like. The following table sets forth the inflation trend assumption used for the valuation: 1 Mortality information was derived from data collected during 2000 to 2019 CalPERS Experience Study released in 2021, which may be accessed on the CalPERS website www.calpers.ca.gov under Forms and Publications. Post-retirement mortality rates include mortality projected fully generational with Scale MP-21. 2. The pre-retirement turnover information was developed based on CalPERS’ specific data. For more details, please refer to the 2000 to 2019 Experience Study Report. The Experience Study Report may be accessed on the CalPERS website www.calpers.ca.gov under Forms and Publications. Calendar Annual Rate Calendar Annual Rate Year Non-Medicare Medicare Kaiser Medicare Other Year Non-Medicare Medicare Kaiser Medicare Other 2024 Actual Premiums 2030 5.60% 4.85% 5.25% 2025 8.50% 6.25% 7.50% 2031 5.05% 4.65% 4.85% 2026 7.90% 5.65% 6.90% 2032-38 4.45% 4.45% 4.45% 2027 7.35% 5.45% 6.50% 2039-40 4.35% 4.35% 4.35% 2028 6.75% 5.25% 6.10% 2041-75 4.30% 4.30% 4.30% 2029 6.20% 5.05% 5.70% 2076+ 3.45% 3.45% 3.45% 84 256 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 8. OTHER POST EMPLOYMENT BENEFITS (Continued) Long-Term Expected Rate of Return The long-term expected rate of return on OPEB plan investments was determined using a building-block method in which expected future real rates of return (expected returns, net of OPEB plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: Discount Rate The discount rate used to measure the total OPEB liability was 5.75 percent. The projection of cash flows used to determine the discount rate assumed that City contributions will be made at rates equal to the actuarially determined contribution rates. Based on those assumptions, the OPEB plan’s fiduciary net position was projected to be available to make all projected OPEB payments for current active and inactive employees and beneficiaries. Therefore, the long-term expected rate of return on OPEB plan investments was applied to all periods of projected benefit payments to determine the total OPEB liability. Asset Class Target Allocation Long-Term Expected Real Rate of Return Global Equity 34% 4.56% Fixed Income 41% 1.56% Treasury Inflation-Protected Securities ("TIPS") 5% -0.08% Commodities 3% 1.22% Real Estate Investment Trusts ("REITS") 17% 4.06% Total 100% * Long-term expected rate of return is 5.75% CERBT Strategy 2 85 257 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 8. OTHER POST EMPLOYMENT BENEFITS (Continued) The changes in the net OPEB Liability/(Asset) for the plan are as follows (in thousands): Sensitivity of the Net OPEB Liability/(Asset) to Changes in the Discount Rate The following presents the net OPEB liability of the City if it were calculated using a discount rate that is one percentage point lower or one percentage point higher than the current rate, for the measurement period ended June 30, 2023 (in thousands): Total OPEB Liability Plan Fiduciary Net Position Net OPEB Liability / (Asset) (a) (b) (c) = (a) - (b) Balance at June 30, 2023 29,692$ 31,716$ (2,024)$ (Measurement Date June 30, 2022) Changes recognized for the measurement period: Service Cost 968 - 968 Interest 1,709 - 1,709 Actual vs. Expected Experience (3,372) - (3,372) Assumption Changes 503 - 503 Contributions - Employer - 1,997 (1,997) Net Investment Income - 1,130 (1,130) Benefit Payments (1,870) (1,870) - Administrative Expenses - (136) 136 Net Changes (2,062) 1,121 (3,183) Balance at June 30, 2024 27,630$ 32,837$ (5,207)$ (Measurement Date June 30, 2023) Increase / (Decrease) 1% Decrease Current Discount Rate 1% Increase (4.75%) (5.75%) (6.75%) Net OPEB Liability (2,072)$ (5,207)$ (7,843)$ 86 258 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 8. OTHER POST EMPLOYMENT BENEFITS (Continued) Sensitivity of the Net OPEB Liability/(Asset) to Changes in the Health Care Cost Trend Rates The following presents the net OPEB liability of the City if it were calculated using health care cost trend rates that are one percentage point lower or one percentage point higher than the current rate, for the measurement period ended June 30, 2023 (in thousands): OPEB Plan Fiduciary Net Position The CERBT issues a publicly available financial report that includes financial statements and required supplementary information. That report may be obtained from the California Public Employees’ Retirement System, CERBT, P.O. Box 942703, Sacramento, CA 94429-2703. Recognition of Deferred Outflows and Deferred Inflows of Resources Gains and losses related to changes in total OPEB liability and fiduciary net position are recognized in OPEB expense systematically over time. Amount are first recognized in OPEB expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to OPEB and are to be recognized in future OPEB expense. The recognition period differs depending on the source of the gain or loss: 5 Years Net difference between projected and actual earnings on OPEB plan investments 1% Decrease Current Trend 1% Increase 7.50% Non-Medicare / 6.50% Medicare (Non- Kaiser) / 5.25% Medicare (Kaiser), decreasing to 2.45% Non-Medicare / 2.45% Medicare (Non- Kaiser), 2.45% Medicare (Kaiser) 8.50% Non-Medicare / 7.50% Medicare (Non- Kaiser) / 6.25% Medicare (Kaiser), decreasing to 3.45% Non-Medicare / 3.45% Medicare (Non- Kaiser), 3.45% Medicare (Kaiser) 9.50% Non-Medicare / 8.50% Medicare (Non- Kaiser) / 7.25% Medicare (Kaiser), decreasing to 4.45% Non-Medicare / 4.45% Medicare (Non- Kaiser), 4.45% Medicare (Kaiser) Net OPEB Liability (7,931)$ (5,207)$ (1,808)$ 87 259 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 8. OTHER POST EMPLOYMENT BENEFITS (Continued) OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB As of June 30, 2024, the City incurred OPEB expense of $206,000. As of June 30, 2024, the City reported deferred outflows and deferred inflows of resources related to OPEB from the following sources: The $935,000 reported as deferred outflows of resources related to contributions subsequent to the June 30, 2023 measurement date will be recognized as a reduction of the net OPEB liability during the Fiscal Year ending June 30, 2025. Other amounts reported as deferred outflows of resources related to OPEB will be recognized as expense as follows (in thousands): Deferred Outflows Deferred Inflows of Resources of Resources OPEB Contributions subsequent to the measurement date 935$ -$ Difference between expected and actual experience 446 6,831 Changes in Assumptions 1,426 1,865 Net difference between projected and actual earnings on OPEB Plan Investments 2,895 - 5,702$ 8,696$ Measurement Periods Ended June 30, 2025 (697)$ 2026 (746) 2027 267 2028 (955) 2029 (953) Thereafter (845) (3,929)$ Deferred Outflows/ (Inflows) of Resources 88 260 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 9. RISK MANAGEMENT The City is exposed to various risks of losses related to torts; theft of, damage to and destruction of assets; errors and omissions; injuries to employees; and natural disasters. The City records the liability claims as expenditures in the Self Insurance General Liability Internal Service Fund and the workers’ compensation claims in the Self Insurance Workers’ Compensation Internal Service Fund. BICEP was created in 1988 by a joint powers agreement between the City of Huntington Beach and four other local entities including Oxnard, Ventura, Santa Ana, and West Covina, for the purpose of providing joint insurance coverage and related risk management services for member cities. BICEP allows member entities to finance a claims payment pool for certain liability claims in excess of $1,000,000 to a maximum coverage limit of $27,000,000 for claims incurred through June 30, 2015, and $24,000,000 thereafter. Effective July 1, 2019, the member agencies of BICEP agreed to dissolve the Joint Powers Authority. BICEP continues to exist for the purpose of disposing of all claims, the distribution of assets, and any other functions necessary to conclude the affairs of BICEP as provided in the Bylaws of the Authority. Upon dissolution of BICEP, the City purchased liability insurance in the open marketplace, which provides insurance for claims costs exceeding the City’s self-insured retention of $1,000,000. The maximum coverage limit is $30,000,000, which is inclusive of the self-insured retention. Claims that exceed the maximum limit of liability are covered by the City’s Self-Insurance General Liability Internal Service Fund. There were no liability claims in the past three years that exceeded the coverage limit. Liability Claims Claims up to $1,000,000 are paid from the City’s Self Insurance General Liability Internal Service Fund. Payments for claims from $1,000,000 to the maximum limit discussed above are covered by the excess liability coverage purchased by the City. Any claims exceeding the maximum limit are covered by the Self Insurance General Liability Internal Service Fund. The liability for these claims is recorded as part of long- term obligations in the Self Insurance General Liability Fund and government-wide financial statements. Liabilities include amounts incurred, but not reported. 89 261 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 9. RISK MANAGEMENT (Continued) Workers’ Compensation Claims Workers’ compensation claims of up to $1,000,000 per claim are paid from the Self Insured Workers’ Comp Internal Service Fund. Excess workers’ compensation coverage is purchased through the CSAC/Prism-Excess Insurance Authority. Payments for claims from $1,000,000 to statutory limits are covered by CSAC/Prism- Excess Insurance Authority. The Self Insurance Workers’ Comp Internal Service Fund has a $36.7 million deficit at year-end at the 55 percent confidence level. The City has established plans to help reduce the deficit in this fund. This will be accomplished by additional transfers from the General Fund, Proprietary funds, and other governmental funds in which employees are charged over the next nine years. Claims activity and liabilities relating to the current and prior year are (in thousands): Workers' Compensation General Liability Total Balance June 30, 2022 42,763$ 13,668$ 56,431$ Additions 12,154 15,848 28,002 Reductions (10,830) (6,982) (17,812) Net Increase (Decrease)1,324 8,866 10,190 Balance June 30, 2023 44,087 22,534 66,621 Additions 14,488 7,085 21,573 Reductions (7,244) (19,855) (27,099) Net Increase (Decrease)7,244 (12,770) (5,526) Balance June 30, 2024 51,331$ 9,764$ 61,095$ 90 262 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 10. INTERFUND TRANSACTIONS a. Advances to/from Other Funds The amounts at year-end were (in thousands): There is a $1,363,000 advance from the LMIHAF Capital Projects Fund to the Redevelopment Agency Private Purpose Trust Fund as of June 30, 2024 for Main Pier property acquisitions prior to the dissolution of the Redevelopment Agency on February 1, 2012. No set interest rates or fixed repayment terms have been established. Redevelopment Agency Private Purpose Trust Advances from (Receivable): Major Governmental Funds LMIHAF Capital Projects 1,363$ Advances to (Payable): 91 263 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 10. INTERFUND TRANSACTIONS (Continued) b. Transfers In/Out The amounts at year-end were (in thousands): The following is a summary of the significant transfers: x $5,137,000 was transferred from General Fund to Other Governmental funds of which, $2,968,000 was transferred for debt service payments, $1,000,000 was transferred for technology upgrades within the Police Department, and $1,169,000 was transferred to reimburse Surf City “3” Fund expenses. x $4,900,000 was transferred to Grant Special Revenue Fund to be used for various Capital Improvement Projects as outlined in the Memorandum of Understanding between the City and AES Southland Development LLC. x $68,000 was transferred from General Fund to Refuse Enterprise Fund to fund senior citizen rate reduction on refuse charges. x $1,500,000 was transferred from General Fund to Pension Liability Fund to cover debt service payments related to Pension Obligation Bond. x $13,000 was transferred from Hazmat Service Enterprise Fund to General Fund to cover administrative and overhead expenditures. x $16,137,000 was transferred from General Fund to Infrastructure Fund for infrastructure-related projects such as road repairs and enhancement and other capital improvement projects. x $612,000 was transferred from Other Government Funds to Infrastructure Fund to reimburse funds for various infrastructure projects. x $465,000 was transferred from Other Government Funds to General Fund to cover administrative cost related to 5th and PCH parking structure. Transfers In General Fund Other Governmental Funds Total Governmental Funds Hazmat Service Fund Total Transfers In General Fund -$ 465$ 465$ 13$ 478$ Pension Liability 1,500 - 1,500 - 1,500 Infrastructure 16,137 612 16,749 - 16,749 Grant Special Revenue 4,900 - 4,900 - 4,900 Other Governmental Funds 5,137 - 5,137 - 5,137 Total Governmental Funds 27,674 1,077 28,751 13 28,764 Refuse Fund 68 - 68 - 68 Total Enterprise Funds 68 - 68 - 68 Total Transfers Out 27,742$ 1,077$ 28,819$ 13$ 28,832$ Transfers Out 92 264 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 11. LONG-TERM OBLIGATIONS Below is a schedule of changes in long-term governmental obligations for the year (in thousands): Governmental Activities: June 30, 2023 Additions Retirements June 30, 2024 Accrued Interest Due Within One Year Public Financing Authority: 2014(a) Lease Revenue Bonds 10,530$ -$ (720)$ 9,810$ 111$ 750$ 2020(a) Lease Revenue Bonds 4,835 - - 4,835 36 - 2020(b) Lease Revenue Bonds 9,795 - (1,530) 8,265 19 1,545 Total Public Financing Authority 25,160 - (2,250) 22,910 166 2,295 Other Long-Term Obligations: Compensated Absences 14,818 5,241 (4,526) 15,533 - 2,045 Claims Payable 66,621 21,573 (27,099) 61,095 - 14,363 Pollution Remediation 2,000 - - 2,000 - - LED Lighting Phase I 191 - (126) 65 1 65 I-Bank CLEEN Loan 1,283 - (310) 973 9 317 CEC Loan 1,797 - (269) 1,528 - 272 Pension Obligation Bonds 318,005 - (12,683) 305,322 344 12,768 Finance Purchase Agreement 17,388 - (3,098) 14,290 46 2,473 Leases Payable 456 - (216) 240 - 155 Subscriptions Payable 2,600 2,666 (1,466) 3,800 48 1,478 Total Other Long-Term Obligations 425,159 29,480 (49,793) 404,846 448 33,936 Total Long-Term Obligations - Governmental Activities 450,319$ 29,480$ (52,043)$ 427,756$ 614$ 36,231$ 93 265 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 11. LONG-TERM OBLIGATIONS (Continued) a. Public Financing Authority (1) 2014(a) Public Financing Authority Lease Revenue Bonds Year of Issuance 2014 Type of Debt Lease Revenue Bonds Original Principal Amount $15,295,000 Security Lease with City Interest Rates 3.0% to 5.0% Interest Payment Dates March 1st, September 1st Principal Payment Dates September 1st Purpose of Debt Finance the construction of a new Senior Center Debt service requirements to maturity are (in thousands): Year Ending June 30 Principal Interest Total 2025 750$ 319$ 1,069$ 2026 785 289 1,074 2027 810 265 1,075 2028 835 240 1,075 2029 860 215 1,075 2030-2034 4,725 636 5,361 2035 1,045 21 1,066 Total 9,810$ 1,985$ 11,795$ 94 266 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 11. LONG-TERM OBLIGATIONS (Continued) (2) 2020(a) Public Financing Authority Lease Revenue Bonds Year of Issuance 2020 Type of Debt Lease Revenue Bonds Original Principal Amount $4,835,000 Security Lease with City Interest Rates 4.0% to 5.0% Interest Payment Dates May 1st, November 1st Principal Payment Dates May 1st Purpose of Debt Defease 2010(a) Lease revenue Bonds which Defeased 1997 Leasehold Revenue Bonds (Construct Pier Plaza and Purchase 800 MHZ system), 2000 Lease Revenue Bonds (Capital Improvements and defeasance of Emerald Cove Certificate of Participation) Debt service requirements to maturity are (in thousands): Year Ending June 30 Principal Interest Total 2025 -$ 224$ 224$ 2026 - 224 224 2027 - 224 224 2028 - 224 224 2029 - 224 224 2030-2032 4,835 455 5,290 Total 4,835$ 1,575$ 6,410$ 95 267 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 11. LONG-TERM OBLIGATIONS (Continued) (3) 2020(b) Public Financing Authority Lease Revenue Bonds Year of Issuance 2020 Type of Debt Lease Revenue Bonds Original Principal Amount $14,440,000 Security Lease with City Interest Rates 0.329% to 1.831% Interest Payment Dates May 1st, November 1st Principal Payment Dates May 1st Purpose of Debt Defease 2011(a) Lease revenue Bonds which Defeased 2001(a) Leasehold Revenue Bonds (Construct Sports Complex and South Beach Phase II Improvements) and 2001(b) Lease Revenue Bonds (Defeased Civic Improvement Corporation Certificates) Debt service requirements to maturity are (in thousands): Year Ending June 30 Principal Interest Total 2025 1,545$ 117$ 1,662$ 2026 1,560 103 1,663 2027 1,575 83 1,658 2028 1,600 61 1,661 2029 1,625 35 1,660 2030 360 7 367 Total 8,265$ 406$ 8,671$ 96 268 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 11. LONG-TERM OBLIGATIONS (Continued) b. Other Long-Term Obligations (1) Compensated Absences There is no repayment schedule to pay the compensated absences amount of $15,533,000 relating to governmental operations. The General Fund typically liquidates the vacation and sick leave liability. (2) Claims Payable There is no repayment schedule for the claims payable for governmental activities of $61,095,000 described in Note 9. The City pays the claims upon final settlement. The General Fund typically liquidates the claims payable liability. (3) Pollution Remediation The City plans to remediate hazardous materials contamination of land located within Huntington Central Park used as a gun range facility prior to its close in 1997. The City is voluntarily planning to remediate the site in order to use the area for park purposes. The cost of the gun range remediation is estimated to be $2,000,000 and is reported as a long-term liability in the government-wide financial statements. The liability was measured by estimating a reasonable range of potential outlays and multiplying those outlays by their probability of occurring. (4) LED Lighting Phase I Year of Issuance 2014 Type of Debt Leaseback from Capital One Public Funding, LLC Principal Amount Original $1,062,924 Security Loan Agreement with Capital One Public Funding, LLC Interest Rate 2.32% Interest Payment Dates February 1st and August 1st Principal Payment Dates August 1st Purpose of Debt To purchase and upgrade street, area and pole lighting to energy efficient LED light sources 97 269 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 11. LONG-TERM OBLIGATIONS (Continued) Debt service requirements to maturity are (in thousands): (5) I-Bank CLEEN Loan Year of Issuance 2016 Type of Debt CLEEN Loan from the California Infrastructure and Economic Development Bank (I-Bank) Principal Amount Original $3,000,000 Security Edwards Fire Station Interest Rate 2.32% Interest Payment Dates February 1st and August 1st Principal Payment Dates August 1st Purpose of Debt To purchase and upgrade street pole lighting to energy efficient LED light sources Debt service requirements to maturity are (in thousands): Year Ending June 30 Principal Interest Total 2025 317$ 19$ 336$ 2026 324 11 335 2027 332 4 336 Total 973$ 34$ 1,007$ Year Ending June 30 Principal Interest Total 2025 65$ 1$ 66$ Total 65$ 1$ 66$ 98 270 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 11. LONG-TERM OBLIGATIONS (Continued) (6) California Energy Commission (CEC) Loan Year of Issuance 2016 Type of Debt Loan from the California Energy Commission (CEC) Principal Amount Original $3,000,000 Security Loan Agreement with CEC Interest Rate 1.00% Interest Payment Dates June 22nd and December 22nd Principal Payment Dates June 22nd and December 22nd Purpose of Debt To upgrade street pole lighting to energy efficient LED light sources Debt service requirements to maturity are (in thousands): Year Ending June 30 Principal Interest Total 2025 272$ 15$ 287$ 2026 274 12 286 2027 277 9 286 2028 280 6 286 2029 283 4 287 2030 142 1 143 Total 1,528$ 47$ 1,575$ 99 271 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 11. LONG-TERM OBLIGATIONS (Continued) (7) Pension Obligation Bonds Year of Issuance 2021 Type of Debt Pension Obligation Bonds Principal Amount Original $341,501,000 Interest Rates 0.221% to 3.376% Interest Payment Dates June 15th and December 15th Principal Payment Dates June 15th Purpose of Debt Pay 85% of CalPERS UAL as of the June 30, 2019 valuation report. Debt service requirements to maturity are (in thousands): Year Ending June 30 Principal Interest Total 2025 12,768$ 8,385$ 21,153$ 2026 12,898 8,248 21,146 2027 13,076 8,074 21,150 2028 13,291 7,855 21,146 2029 13,548 7,601 21,149 2030-2034 72,690 33,048 105,738 2035-2039 83,510 22,227 105,737 2040-2044 83,541 7,922 91,463 Total 305,322$ 103,360$ 408,682$ 100 272 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 11. LONG-TERM OBLIGATIONS (Continued) (8) Finance Purchase Agreement Year of Issuance 2021 Type of Debt Capital Purchase Agreement Principal Amount Various Security Master Lease Agreement Interest Rates 1.249% and 1.775% Interest Payment Dates Semi-Annually Principal Payment Dates Semi-Annually Purpose of Debt Public Safety Equipment Financing Debt service requirements to maturity are (in thousands): (9) Lease Payable The City of Huntington Beach has entered into three leases as a lessee for the use of land and equipment and is required to make monthly fixed payments ranging from $4,982 to $7,195 over the lease terms. As of June 30, 2024, the value of the lease liability was $240,030. The future principal and interest lease payments as of June 30, 2024, were as follows: Year Ending June 30,Principal Interest Total 2025 155$ 4$ 159$ 2026 85 1 86 Total 240$ 5$ 245$ Year Ending June 30 Principal Interest Total 2025 2,473$ 361$ 2,834$ 2026 2,266 302 2,568 2027 2,324 245 2,569 2028 2,038 186 2,224 2029 2,093 131 2,224 2030-2031 3,096 92 3,188 Total 14,290$ 1,317$ 15,607$ 101 273 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 11. LONG-TERM OBLIGATIONS (Continued) (10) Subscription Payable For the year ended June 30, 2023, the financial statements include the adoption of GASB Statement No. 96, Subscription-Based Information Technology Arrangements. The primary objective of this statement is to enhance the relevance and consistency of information about governments' subscription activities. This statement establishes a single model for subscription accounting based on the principle that subscriptions are financings of the right to use an underlying asset. Under this Statement, an organization is required to recognize a subscription liability and an intangible right-to-use subscription asset. The City of Huntington Beach has entered into seven subscription agreements for the use of various IT software and is required to make annual fixed payments ranging from $15,018 to $590,553 over the subscription terms. As of June 30, 2024, the value of the subscription liability was $3,800,000. The future principal and interest subscription payment as of June 30, 2024, were as follows: Year Ending June 30 Principal Interest Total 2025 1,478$ 80$ 1,558$ 2026 981 47 1,028 2027 655 28 683 2028 686 14 700 Total 3,800$ 169$ 3,969$ 102 274 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 11. LONG-TERM OBLIGATIONS (Continued) c. Long-Term Obligations – Business-Type Activities Below is a schedule of the long-term obligations of business-type activities (in thousands): (1) Compensated Absences There is no repayment schedule for the compensated absences amount of $1,758,000 relating to business-type activities. The balance for the outstanding business-type compensated absences is predominately related to the Water and Sewer funds. (2) Pension Obligation Bond Year of Issuance 2021 Type of Debt Pension Obligation Bonds Principal Amount Original $22,144,000 Interest Rates 0.221% to 3.376% Interest Payment Dates June 15th and December 15th Principal Payment Dates June 15th Purpose of Debt Pay 85% of CalPERS UAL as of the June 30, 2019 valuation report. Debt service requirements to maturity are (in thousands): June 30, 2023 Additions Retirements June 30, 2024 Accrued Interest Due Within One Year CompensatedAbsences 1,826$ 416$ (484)$ 1,758$ -$ 479$ PensionObligationBonds 20,480 - (891) 19,589 22 898 Total Long-Term Obligations - Business-Type Activities 22,306$ 416$ (1,375)$ 21,347$ 22$ 1,377$ Long-Term Obligations - Business-Type Activities: Year Ending June 30 Principal Interest Total 2025 898$ 526$ 1,424$ 2026 907 517 1,424 2027 919 504 1,423 2028 934 489 1,423 2029 952 471 1,423 2030-2034 5,111 2,007 7,118 2035-2039 5,870 1,246 7,116 2040-2042 3,998 272 4,270 Total 19,589$ 6,032$ 25,621$ 103 275 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 11. LONG-TERM OBLIGATIONS (Continued) d. Long-Term Conduit Debt Obligations Below is a schedule of the conduit debt obligations for which the City is not liable in any manner (in thousands): 12. CAPITAL ASSETS a. Changes in Capital Assets Capital asset activity for the year was (in thousands): June 30, 2023 Additions Retirements June 30, 2024 Community Facilities District No. 2000-1 2013 Special Tax Refunding Bonds 7,730$ -$ (705)$ 7,025$ Community Facilities District No. 2002-1 Special Assessment Tax Bonds 3,405 - (220) 3,185 Community Facilities District No. 2003-1 2013 Special Tax Refunding Bonds 13,745 - (965) 12,780 Total Community Facilities Districts 24,880 - (1,890) 22,990 Total Obligations Not Recorded in Financial Statements 24,880$ -$ (1,890)$ 22,990$ Community Facilities Districts: June 30,June 30, 2023 Additions Dispositions 2024 Governmental Activities Capital Assets, Not Depreciated: Land 369,538$ -$ -$ 369,538$ Construction in Progress 11,249 10,363 (6,471) 15,141 Total Capital Assets - Not Depreciated 380,787 10,363 (6,471) 384,679 Capital Assets Being Depreciated Buildings 227,075 3,415 - 230,490 Machinery and Equipment 89,572 12,325 (132) 101,765 Infrastructure 479,499 18,916 (1,437) 496,978 Right to Use Leased Land 274 - - 274 Right to Use Leased Machinery and Equipment 398 - - 398 Right to Use SBITA 3,651 2,666 - 6,317 Total Capital Assets Being Depreciated 800,469 37,322 (1,569) 836,222 Less Accumulated Depreciation: Buildings (99,255) (5,357) - (104,612) Machinery and Equipment (57,171) (6,177) 126 (63,222) Infrastructure (251,858) (8,589) 1,437 (259,010) Right to Use Leased Land (168) (84) - (252) Right to Use Leased Machinery and Equipment (42) (135) - (177) Right to Use SBITA (724) (1,393) - (2,117) Total Accumulated Depreciation (409,218) (21,735) 1,563 (429,390) Total Depreciated - Net 391,251 15,587 (6) 406,832 Total Capital Assets 1,181,256 47,685 (8,040) 1,220,901 Total Accumulated Depreciation (409,218) (21,735) 1,563 (429,390) Capital Assets of Governmental Activities - Net 772,038$ 25,950$ (6,477)$ 791,511$ 104 276 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 12. CAPITAL ASSETS (Continued) b. Depreciation Expense Depreciation in governmental activities was charged to the following functions/programs in the Statement of Activities (in thousands): Depreciation in business-type activities was charged to the following functions/programs in the Statement of Activities (in thousands): Department: City Council 5$ City Manager 97 City Treasurer 22 City Attorney 44 City Clerk 18 Finance 400 Human Resources 29 Community Development 300 Fire 1,028 Information Services 795 Police 1,830 Community Services 2,677 Library Services 367 Public Works 12,104 Internal Service Fund depreciation charged to functions 2,019 Total 21,735$ Fund: Water 3,937$ Sewer Service 2,411 Refuse 21 Total 6,369$ Business-Type Activities: June 30, 2023 Additions Dispositions June 30, 2024 Capital Assets, Not Depreciated: Land 3,907$ -$ -$ 3,907$ Construction in Progress 839 2,544 - 3,383 Total Capital Assets -Not Depreciated 4,746 2,544 - 7,290 Capital Assets Being Depreciated Buildings 105,623 - - 105,623 Machinery and Equipment 19,583 1,423 (75) 20,931 Infrastructure 154,148 2,053 (245) 155,956 Total Capital Assets Being Depreciated 279,354 3,476 (320) 282,510 Less Accumulated Depreciation: Buildings (39,534) (2,574) - (42,108) Machinery and Equipment (13,519) (1,345) 75 (14,789) Infrastructure (89,464) (2,450) 245 (91,669) Total Accumulated Depreciation (142,517) (6,369) 320 (148,566) Total Depreciated - Net 136,837 (2,893) - 133,944 Total Capital Assets 284,100 6,020 (320) 289,800 Total Accumulated Depreciation (142,517) (6,369) 320 (148,566) Capital Assets of Business Activities - Net 141,583$ (349)$ -$ 141,234$ 105 277 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 13. INVESTMENT IN JOINT VENTURES The City participates in a firefighter training center called Central Net Operations Authority (CNOA) through a joint powers agreement with the City of Fountain Valley. The City of Huntington Beach records 76 percent of CNOA net assets as Joint Venture Investments. There is no separate Component Unit Financial Report (CUFR) prepared for the CNOA. 14. LEASES The City of Huntington Beach has entered into 27 leases as a lessor for the use of City land and infrastructures. The lessees are required to make fixed monthly payments ranging from $322 to $44,000 over the lease terms. The City recognized $1,629,000 in lease revenue and $104,000 in interest revenue during the current fiscal year related to these agreements. As of June 30, 2024, the lease receivable is $9,462,000 and deferred inflow of resources is $9,191,000. The future principal and interest payments as of June 30, 2024, were as follows: Year Ending June 30,Principal Interest Total 2025 1,491$ 95$ 1,586$ 2026 1,501 87 1,588 2027 1,423 78 1,501 2028 833 70 903 2029 470 65 535 2030-2034 1,254 260 1,514 2035-2039 824 188 1,012 2040-2044 813 126 939 2045-2049 567 67 634 2050-2054 286 12 298 Total 9,462$ 1,048$ 10,510$ 106 278 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 15. SUCCESSOR AGENCY TRUST FOR ASSETS OF THE FORMER REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH a. General Discussion On December 29, 2011, the California Supreme Court upheld ABX1 26 that provided for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City of Huntington Beach that was previously reported as a Redevelopment Agency within the City as a blended component unit. ABX1 26 provides that upon dissolution of a Redevelopment Agency, either the City or another unit of local government will agree to serve as the “Successor Agency” to hold the assets until they are distributed to other units of state and local government. On January 9, 2012, the City Council elected to become the Successor Agency for the former Redevelopment Agency in accordance with ABX1 26 as part of City resolution number 2012-01. After enactment of the law, effective June 28, 2011, Redevelopment Agencies in the State of California generally cannot enter into new projects, obligations or commitments. Subject to the control of a newly established Oversight Board, remaining assets can only be used to pay enforceable obligations in existence at the date of dissolution (including the completion of any unfinished projects that were subject to legally enforceable contractual commitments). In future fiscal years, Successor Agencies will only be allocated revenue in the amount that is necessary to pay the estimated annual installment payments on enforceable obligations of the former redevelopment agency until all enforceable obligations of the prior Redevelopment Agency have been paid in full and all assets have been liquidated. ABX1 26 directs the State Controller of the State of California to review the propriety of any transfers of assets between Redevelopment Agencies 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 of successor agency by ABX1 26. 107 279 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 15. SUCCESSOR AGENCY TRUST FOR ASSETS OF THE FORMER REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH (Continued) b. Long-Term Debt Below is a schedule of changes in long-term obligations of the Successor Agency for the year (in thousands): (1) 1999 Tax Allocation Refunding Bonds Year of Issuance 1999 Type of Debt Tax Allocation Refunding Bonds Original Principal Amount $10,835,000 Security Tax Increment Interest Rates 3.00% to 5.05% Interest Payment Dates February 1st and August 1st Principal Payment Dates August 1st Purpose of Debt Prepay Agency’s 1992 Loans to Public Financing Authority Debt service requirements to maturity are (in thousands): Successor Agency: June 30, 2023 Additions Retirements June 30, 2024 Accrued Interest Due Within One Year Bonds Payable 1999 Tax Allocation Refunding Bond 785$ -$ (425)$ 360$ 8$ 360$ 2002 Tax Allocation Bonds 1,700 - (920) 780 16 780 Total Bonds Payable 2,485 - (1,345) 1,140 24 1,140 Other Long-Term Obligations Bella Terra OPA (Parking)1,868 - (1,868) - - - Bella Terra AHA (Phase II)11,329 - (835) 10,494 - 835 CIM DDA (Parking & Infrastructure)4,641 - (353) 4,288 225 378 CIM DDA (Additional Parking)321 - (17) 304 23 19 Total Other Long-Term Obligations 18,159 - (3,073) 15,086 248 1,232 Total Long-Term Obligations 20,644$ -$ (4,418)$ 16,226$ 272$ 2,372$ Year Ending June 30 Principal Interest Total 2025 360$ 9$ 369$ Total 360$ 9$ 369$ 108 280 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 15. SUCCESSOR AGENCY TRUST FOR ASSETS OF THE FORMER REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH (Continued) (2) 2002 Tax Allocation Refunding Bonds Year of Issuance 2002 Type of Debt Tax Allocation Refunding Bonds Original Principal Amount $20,900,000 Security Tax Increment Interest Rates 2.00% to 5.00% Interest Payment Dates February 1st and August 1st Principal Payment Dates August 1st Purpose of Debt Prepay Agency’s 1992 Loans to Public Financing Authority and fully defease 1992 Public Financing Authority bonds Debt service requirements to maturity are (in thousands): Pledged Revenues The Successor Agency will repay a total of $1,169,000, principal and interest, for the outstanding 1999 and 2002 Tax Allocation Refunding Bonds as of June 30, 2024 from semi-annual Redevelopment Property Tax Trust Fund (RPTTF) revenue allocations. The 1999 and 2002 Tax Allocation Refunding Bonds are not a debt of the City of Huntington Beach, the State of California, nor any of its political subdivisions, and neither the City, the State nor any of its political subdivision is liable therefore, not in any event shall the bonds be payable out of funds or properties other than those of the Redevelopment Agency as set forth in the bond indenture. Year Ending June 30 Principal Interest Total 2025 780$ 20$ 800$ Total 780$ 20$ 800$ 109 281 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 15. SUCCESSOR AGENCY TRUST FOR ASSETS OF THE FORMER REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH (Continued) (3) Bella Terra Parking Structure In Fiscal Year 2005/06, the Agency entered into an owner participation agreement with Bella Terra Associates, LLC (formerly Huntington Center Associates, LLC). Under the agreement, the Corporation would construct various public improvements, including a parking structure, which would then be deeded to the City. The Agency would reimburse $15,000,000 of the costs of the public improvements. The City paid off the Successor Agency obligation under the agreement in FY23-24. The interest rate of this obligation is 6.94%. The agreement has been approved as an enforceable obligation by the Department of Finance (DOF). (4) Bella Terra Phase II In Fiscal Year 2010/11, the Agency entered into an affordable housing agreement with BTDJM Phase II Associates (DJM). The agreement would facilitate the construction of a 467 unit mixed use project, including 43 moderate units and 28 very low units. Under the terms of the agreement, the Agency would reimburse DJM for the construction of the affordable units up to $17,000,000. DJM has transferred the site to UDR, and as of year-end, the Successor Agency obligation under the agreement amounted to $10,494,000. Reimbursement of the affordable units will be based upon the site-generated tax increment for the mixed use project as well as the 20% housing fund from the site-generated Bella Terra I. The interest rate of this obligation is 4.00%. The agreement has been approved as an enforceable obligation by the DOF. 110 282 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 15. SUCCESSOR AGENCY TRUST FOR ASSETS OF THE FORMER REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH (Continued) (5) CIM/Huntington Disposition and Development Agreement – Strand Parking Structure and Infrastructure Year of Issuance 2009 Type of Debt Loan from CIM Group, LLC Original Principal Amount $7,900,000 Security Tax Increment Interest Rates 7.00% Interest Payment Dates September 30th Principal Payment Dates September 30th Purpose of Debt Strand Parking Structure and Infrastructure As of year-end, the Successor Agency obligation under the agreement amounted to $4,288,000. Repayment shall be made solely from Redevelopment Property Tax Trust Fund (RPTTF) revenues received by the Huntington Beach Redevelopment Successor Agency Private Purpose Trust Fund in the amounts included in the Oversight Board approved Recognized Obligation Payment Schedule (ROPS) to the County Auditor Controller (CAC) and the Department of Finance (DOF). The Disposition and Development Agreement (DDA) has been approved as an enforceable obligation by the DOF. 111 283 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 15. SUCCESSOR AGENCY TRUST FOR ASSETS OF THE FORMER REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH (Continued) (6) CIM/Huntington Disposition and Development Agreement – Additional Strand Parking Year of Issuance 2009 Type of Debt Loan from CIM Group, LLC Original Principal Amount $950,000 Security Tax Increment Interest Rates 10.00% Interest Payment Dates September 30th Principal Payment Dates September 30th Purpose of Debt Additional Strand Parking Structure and Infrastructure As of year-end, the Successor Agency obligation under the agreement amounted to $304,000. Repayment shall be made solely from Redevelopment Property Tax Trust Fund (RPTTF) revenues received by the Huntington Beach Redevelopment Successor Agency Private Purpose Trust Fund in the amounts included in the Oversight Board approved Recognized Obligation Payment Schedule (ROPS) to the County Auditor Controller (CAC) and the Department of Finance (DOF). The DDA has been approved as an enforceable obligation by the DOF. c. Advances from the City Housing Fund The Successor Agency has recorded advances from the City Housing Fund totaling $1,363,000 from the Low-Income Housing Fund to the Redevelopment Agency Capital Projects Fund for Main Pier property acquisitions. 16. COMMITMENTS AND CONTINGENCIES a. Legal Actions There are legal actions pending against the City resulting from normal operations. In the opinion of management and the City Attorney, the financial resolution of these actions should not have a significant impact on these financial statements. 112 284 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 16. COMMITMENTS AND CONTINGENCIES (Continued) b. Sales Tax Sharing Agreements City Council has agreed to provide sales tax rebates to various companies, based upon various factors such as increased job-base or new sales tax to the City. The sales tax rebates serve to attract and retain various companies in the City of Huntington Beach. The City of Huntington Beach has three sales tax sharing agreements with Pinnacle Petroleum (2029), (McKenna Subaru HB) 2033, and Surf City Auto Group II, Inc. (2038). Pinnacle Petroleum receives a 65% rebate after base sales exceed $25,000, McKenna Subaru HB receives a 45% rebate after base sales exceed $150,800, and Surf City Auto Group II, Inc. receives a 50% rebate after base sales exceed $1,785,261 (which increases by 1% annually). Sales tax rebates totaled $1,049,772 for the year ending June 30, 2024. c. Cooperation and Owner Participation Agreements On September 2, 2003, the Redevelopment Agency Approved a Cooperation Agreement Regarding Capital Improvements in the Southeast Coastal Redevelopment Project with the City. This agreement commits the Redevelopment Agency to reimburse the City for a number of capital improvement projects to be undertaken as part of the Five Year Capital Improvement Program in the Southeast Redevelopment project area starting in FY 2003/04 as they are undertaken. The Successor Agency received its Finding of Completion notice from the Department of Finance on May 13, 2014. The Oversight Board (to the Successor Agency) have approved and reauthorization of the loans between the City and former Redevelopment Agency in FY 2016/17. The State Department of Finance (DOF) has denied the validity of the loans and the City has filed suit against the State. On April 22, 2022, the Superior Court of California issued a Proposed Judgment stating that the agreement did not constitute an enforceable obligation and that repayment was not required. The City requested a hearing with the Court to appeal this determination. On February 17, 2023, the Superior Court of California issued a final ruling stating that the agreement did not constitute an enforceable obligation; thus, repayment was not required. d. Redevelopment Successor Agency Debt to City The City has advanced money to the Redevelopment Agency for major capital improvements, economic development projects, and operations. In January 2011, the City Council and Redevelopment Agency Board approved a revised Cooperation Agreement, which included a Promissory Note that memorialized indebtedness previously incurred by the Agency and owed to the City from a series of loans made from the City to the Agency from 1982 to present. 113 285 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 16. COMMITMENTS AND CONTINGENCIES (Continued) The City and Successor Agency have not recorded the advances in the accompanying financial statements due to uncertainties related to Health and Safety Code Section 34191.4, which establishes certain restrictions and limitations on the repayment of city-agency loans. In accordance with Health and Safety Code Section 34191.4(b)(3), all other loans between the city and former Redevelopment Agency will begin to be repaid, at a 3% interest rate, as determined by SB 107 upon approval of the Oversight Board and the Department of Finance. The Oversight Board (to the Successor Agency) have approved and reauthorized the loans between the City and former Redevelopment Agency in FY 2016/17. The State Department of Finance has denied the validity of the loans and the City has filed suit against the State. On April 22, 2022, the Superior Court of California issued a Proposed Judgment stating that the majority of the agreements between the City and the former Redevelopment Agency were not considered enforceable obligations and that repayment was not required, with the exception of the $22,400,000 loan for the purchase of the Waterfront property. The DOF denied this obligation in a follow up letter to the City dated August 24, 2022. The City has requested a hearing with the Court to appeal this determination. On February 17, 2023, the Superior Court of California issued a final ruling confirming the April 22, 2022 determination. As of June 30, 2024, the City recognizes $31,136,000 of receivables relating to the Waterfront property purchase to be paid in future Recognized Obligation Payment Schedule (ROPS). Below is a schedule of the activity for the year (in thousands): June 30, 2023 Additions Reductions June 30, 2024 General Fund Direct Advances 2,312$ -$ -$ 2,312$ Indirect Advances 6,567 - - 6,567 Land Sales 32,833 - (22,400) 10,433 Interest 35,859 3,065 (3,719) 35,205 Total General Fund 77,571 3,065 (26,119) 54,517 Sewer Fund Direct Advances 308 13 - 321 Deferred Development Fees 192 8 - 200 Total Sewer Fund 500 21 - 521 Drainage Fund Direct Advances 743 31 - 774 Deferred Development Fees 205 8 - 213 Total Drainage Fund 948 39 - 987 Park Acquisition and Development Fund Direct Advances 6,122 252 - 6,374 Deferred Development Fees 454 19 - 473 Total Park Acquisition and Development Fund 6,576 271 - 6,847 Water Fund Direct Advances 4,607 189 - 4,796 Total Water Fund 4,607 189 - 4,796 Total All Funds 90,202$ 3,585$ (26,119)$ 67,668$ 114 286 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 16. COMMITMENTS AND CONTINGENCIES (Continued) e. Low Moderate Income Housing Asset Fund Debt to City In May 2009, a Promissory Note was issued by the Redevelopment Agency to the City to pay for outstanding bonded debt related to the Emerald Cove Housing Project. The note is secured by a pledge of Set-Aside Funds. Based on the Promissory Note, the interest rate for the loan is 0% and the loan was scheduled to be repaid by 2021. The City has not recorded the advances in the accompanying financial statements due to uncertainties surrounding ABX1 26 and Assembly Bill 1484 and related litigation (see note 16f). On April 22, 2022, the Superior Court of California issued a Proposed Judgment stating that this loan is considered an enforceable obligation to be paid on the FY 2023-24 Recognized Obligation Payment Schedule (ROPS). In FY 2023-24 the Successor Agency received payment and paid back the promissory note held by the City. Below is a schedule of the activity for the year (in thousands): f. Successor Agency Litigation Until 2012, the Huntington Beach Redevelopment Agency existed and received property tax increment from property within the “City Redevelopment Project Area.” In 2012, the State Legislature dissolved all redevelopment agencies, and all tax increment was returned to the County for payment to other taxing entities. The only exception was that tax increment would continue to be paid to the Successor Agency to the City Redevelopment Agency to pay any pre-dissolution, legally binding obligations established prior to the dissolution of the agencies. Further, the City transferred the former Redevelopment Agency’s housing obligations to the Huntington Beach Housing Authority pursuant to Health and Safety Code section 34176. The Successor Agency contended that the 2012 Pacific City Development Agreement was a pre-dissolution, legally binding obligation. Pacific City is a development project that was conditioned on providing 77 affordable housing units, of which the Successor Agency now was obliged to construct 26 units off-site, at a cost of $6,500,000. This would not be a City General Fund obligation. June 30, 2022 Additions Reductions June 30, 2024 General Fund Emerald Cove 3,245$ -$ (3,245)$ -$ 115 287 City of Huntington Beach Notes to Financial Statements For the Year Ended June 30, 2024 16. COMMITMENTS AND CONTINGENCIES (Continued) On April 22, 2022, the Superior Court of California issued a Proposed Judgment stating that the majority of the agreements between the City and the former Redevelopment Agency were not considered enforceable obligations and that repayment was not required, with the exception of the $22,400,000 loan for the purchase of the Waterfront property and the Promissory Note related to the Emerald Cove Housing Project. The City has requested a hearing with the Court to appeal this determination. On February 17, 2023, the Superior Court of California issued a final ruling confirming the April 22, 2022 determination. On May 19, 2023, the DOF issued a letter confirming the Court ruling. In FY 2023-24 the Successor Agency received payment and paid back the promissory note held by the City relating to Emerald Cove Housing Project. Additionally, the City recognizes $31,136,000 of receivables relating to the Waterfront property purchase to be paid in future Recognized Obligation Payment Schedule (ROPS). The Housing Authority is reviewing options on meeting the affordable housing requirements for Pacific City with other projects. The City itself does not require a reserve for either case. 17. OTHER INFORMATION Fund and Accumulated Deficits The following fund have total fund deficits at year-end (in thousands): The Self Insurance Workers’ Compensation fund has a deficit due to increases in statutory benefits related to workers’ compensation claims and rising healthcare costs. The City has established plans to reduce and eliminate the deficits in these funds. Additional transfers will be made over the next ten to twenty years from the General Fund, Proprietary funds, and other governmental funds to address the deficits in the Self Insurance Workers’ Compensation and General Liability Internal Service Funds. Internal Service Fund: Self Insurance Workers' Comp 26,415$ 116 288 THIS PAGE INTENTIONALLY LEFT BLANK 117 289 REQUIRED SUPPLEMENTARY INFORMATION 118 290 THIS PAGE INTENTIONALLY LEFT BLANK 119 291 City of Huntington Beach Notes to Required Supplementary Information For the Year Ended June 30, 2024 Budgetary Information The City Council must annually adopt a budget by June 30 of the prior fiscal year. The budgeted expenditures become the appropriations to the various departments. The budget includes estimates for revenue that, along with the appropriations, compute the budgetary fund balance. The appropriated budget covers substantially all governmental fund expenditures with the exception of capital improvement projects (capital projects funds) carried forward from prior years, which constitute a legally authorized non-appropriated budget. The City Council may amend the budget at any time. The City Manager may transfer funds from between object purposes (personal services, operating expenditures, or capital outlay expenditures) within the same department without changing the total departmental budget. Department heads, with the Chief Financial Officer’s approval, may transfer funds from like object categories of the same department. The City Council must approve any changes to departmental budgets. Expenditures may not exceed appropriations at the departmental level. All unused appropriations lapse at year-end. During the year, the City Council made several supplemental appropriations which included carryovers of prior year encumbrances, all of which were within available fund balance and estimated revenue amounts. The City Council adopts governmental fund budgets consistent with generally accepted principles as legally required. There are no significant non-budgeted financial activities. Revenues for special revenue funds are budgeted by entitlements, grants and estimates of future development and economic growth. Expenditures and transfers are budgeted based upon available financial resources. On or before February 28th of each year, each department submits data to the City Manager for budget preparation. Staff prepares the budget by fund, function, and activity. The budget includes information on past years, current year estimates and requested appropriations for the next fiscal year. Before May 1st, the City Council receives the proposed budget. The City Council holds public hearings and may amend the budget by a majority vote. Changes to the budget must be within the available revenues and reserves. These financial schedules show budgetary data for the General and Grants Special Revenue. The original budget, revised budget, actual expenditures, and variance amounts are shown. The City uses an encumbrance system as an aid in controlling expenditures. When the City issues a purchase order for goods or services, it records an encumbrance until the vendor delivers the goods or performs the service. At year-end, the City reports all outstanding encumbrances as committed or assigned fund balance in governmental fund types. The City reappropriates these encumbrances into the new fiscal year. The following pages present schedules of budget to actual comparison of the General and Grants Special Revenue Fund’s Revenues, and Expenditures and Changes in Fund Balance (in thousands). 120 292 REVENUES Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Property Taxes 104,197$ 105,750$ 105,750$ -$ Sales Taxes 53,554 51,421 51,421 - Utility Taxes 21,245 23,283 23,283 - Other Taxes 28,330 27,103 27,024 (79) Licenses and Permits 9,140 10,200 10,200 - Fines, Forfeitures and Penalties 5,061 3,666 3,666 - Use of Money and Property 21,741 27,646 30,133 2,487 Intergovernmental 2,714 9,084 11,387 2,303 Charges for Current Service 34,137 31,800 31,671 (129) Other 1,786 1,655 2,234 579 Total Revenues 281,905 291,608 296,769 5,161 EXPENDITURES Current: City Council 497 549 464 85 City Manager 3,870 5,272 4,853 419 City Treasurer 1,798 2,077 2,059 18 City Attorney 3,612 4,201 3,994 207 City Clerk 1,150 1,862 1,653 209 Finance 5,372 6,444 5,963 481 Human Resources 2,528 3,113 2,636 477 Community Development 14,717 18,152 13,410 4,742 Fire 55,406 71,576 71,576 - Information Services 8,034 9,431 7,896 1,535 Police 87,117 99,965 99,071 894 Community Services 10,611 12,966 12,354 612 Library Services 5,494 6,998 6,954 44 Public Works 23,951 27,932 27,436 496 Debt Service: Principal 2,809 5,485 5,485 - Interest 212 585 585 - Total Expenditures 227,178 276,608 266,389 10,219 Excess of Revenues Over Expenditures 54,727 15,000 30,380 15,380 OTHER FINANCING SOURCES (USES) Transfers In 4,223 2,787 478 (2,309) Subscription Based IT Arrangement - - 2,666 2,666 Transfers Out (58,754) (27,742) (27,742) - Total Other Financing Sources (Uses) (54,531) (24,955) (24,598) 357 Net Change In Fund Balance 196 (9,955) 5,782 15,737 Fund Balance - Beginning of Year 126,537 126,537 126,537 - Fund Balance - End of Year 126,733$ 116,582$ 132,319$ 15,737$ CITY OF HUNTINGTON BEACH SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) General Fund See Accompanying Notes to Required Supplementary Information 121 293 REVENUES Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property -$ -$ 276$ 276$ Intergovernmental 4,262 12,414 12,141 (273) Other - - 814 814 Total Revenues 4,262 12,414 13,231 817 EXPENDITURES Current: City Manager - 6,868 1,777 5,091 Community Development 2,446 5,807 3,277 2,530 Fire - 44 36 8 Police 881 5,832 3,551 2,281 Community Services 334 369 324 45 Library Services 60 249 229 20 Public Works 5,869 25,827 6,880 18,947 Total Expenditures 9,590 44,996 16,074 28,922 Excess of Revenues Over (Under) Expenditures (5,328) (32,582) (2,843) 29,739 OTHER FINANCING USES Transfers In 4,900 4,900 4,900 - Transfers Out (50) - - - Total Other Financing Sources (Uses) 4,850 4,900 4,900 - Net Change In Fund Balance (478) (27,682) 2,057 29,739 Fund Balance - Beginning of Year 655 655 655 - Fund Balance - End of Year 177$ (27,027)$ 2,712$ 29,739$ (In Thousands) Grants Special Revenue CITY OF HUNTINGTON BEACH SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL FOR THE YEAR ENDED JUNE 30, 2024 See Accompanying Notes to Required Supplementary Information 122 294 Measurement Period 2022-23 2021-22 2020-21 2019-20 2018-19 2017-18 2016-17 2015-16 2014-15 2013-14 Total Pension Liability Service cost 9,167$ 8,174$ 8,005$ 7,779$ 8,327$ 8,314$ 8,084$ 7,436$ 7,102$ 7,263$ Interest on total pension liability 44,775 43,253 42,217 41,058 40,150 38,769 37,749 37,194 35,653 34,412 Differences between expected and actual experience 5,260 451 (891) (6,087) (183) (2,042) (9,148) 1,072 (2,900) - Changes of Benefit Terms 658 - - - - - - - - - Changes in assumptions - 19,824 - - - (3,634) 30,762 - (8,565) - Benefit payments, including refunds of employee contributions (36,633) (34,942) (33,392) (30,321) (28,508) (26,685) (25,312) (24,316) (23,377) (22,444) Net change in total pension liability 23,227 36,760 15,939 12,429 19,786 14,722 42,135 21,386 7,913 19,231 Total pension liability - beginning 656,726 619,966 604,027 591,598 571,812 557,090 514,955 493,569 485,656 466,425 Total pension liability - ending (a)679,953$ 656,726$ 619,966$ 604,027$ 591,598$ 571,812$ 557,090$ 514,955$ 493,569$ 485,656$ Plan Fiduciary Net Position Contributions - employer 7,450$ 6,951$ 150,917$ 16,879$ 14,816$ 13,495$ 12,316$ 10,982$ 9,747$ 9,066$ Contributions - employee 3,741 3,533 3,450 3,630 3,779 3,649 3,869 3,736 3,790 3,909 Investment income 36,077 (49,840) 107,447 21,485 27,288 32,963 40,328 1,856 8,230 56,429 Administrative Expense (439) (419) (443) (609) (296) (614) (536) (226) (418) (472) Benefit payments (36,633) (34,942) (33,392) (30,321) (28,508) (26,685) (25,312) (24,316) (23,377) (22,444) Plan to Plan Resource Movement 1 - - - (13) 1 - - -- Other - - - - 1 (1,166) - - 2 - Net change in plan fiduciary net position 10,197 (74,717) 227,979 11,064 17,067 21,643 30,665 (7,968) (2,026) 46,488 Plan fiduciary net position - beginning 596,848 671,565 443,586 432,522 415,455 393,812 363,147 371,115 373,141 326,653 Plan fiduciary net position - ending (b)607,045$ 596,848$ 671,565$ 443,586$ 432,522$ 415,455$ 393,812$ 363,147$ 371,115$ 373,141$ Net pension liability - beginning 59,878 (51,599) 160,441 159,076 156,357 163,278 151,808 122,454 112,515 139,771 Net pension liability (asset) - ending (a)-(b)72,908$ 59,878$ (51,599)$ 160,441$ 159,076$ 156,357$ 163,278$ 151,808$ 122,454$ 112,515$ Plan fiduciary net position as a percentage of the total pension liability (asset)89.28% 90.88% 108.32% 73.44% 73.11% 72.66% 70.69% 70.52% 75.19% 76.83% Covered payroll 51,089$ 46,824$ 45,740$ 45,952$ 45,419$ 45,431$ 44,848$ 44,365$ 44,233$ 41,142$ Net pension liability as a percentage of covered payroll 142.71% 127.88% N/A 349.15% 350.24% 344.16% 364.07% 342.18% 276.84% 273.48% Notes to Schedule: * For covered payroll, the measurement period of July 1, 2022 to June 30, 2023 was used. Benefit changes: the figures above include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date. However, offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes) that occurred after the Valuation Date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary. In 2022, SB 1168 increased the standard retiree lump sum death benefit from $500 to $2,000 for any death occurring on or after July 1, 2023. The impact, if any, is included in the changes of benefit terms. Changes in assumptions: There were no assumption changes in 2023. Effective with the June 30, 2021 valuation date (June 30, 2022 measurement date), the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. In addition, demographic assumptions and the price inflation assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The accounting discount rate was 7.15% for measurement dates June 30, 2017 through June 30, 2021, 7.65% for measurement dates June 30, 2015 through June 30, 2016, and 7.50% for measurement date June 30, 2014. City of Huntington Beach Required Supplementary Information Schedule of Changes in the Net Pension Liability and Related Ratios During the Measurement Period (in Thousands) Last Ten Fiscal Years CalPERS City Miscellaneous Plan - 99 123 295 (in Thousands) Measurement Period 2022-23 2021-22 2020-21 2019-20 2018-19 2017-18 2016-17 2015-16 2014-15 2013-14 Total Pension Liability Service cost 15,176$ 14,683$ 13,386$ 13,226$ 13,644$ 13,509$ 13,657$ 12,159$ 11,119$ 11,096$ Interest on total pension liability 60,569 57,872 56,114 54,597 53,048 51,223 49,350 48,390 46,160 44,246 Differences between expected and actual experience 13,601 102 (3,882) (4,721) (1,220) 2,584 (10,819) 2,678 (820) - Changes of Benefit Terms 374 - - - - - - - - - Changes in assumptions - 28,785 - - - (3,657) 40,352 - (11,054) - Benefit payments, including refunds of employee contributions (49,495) (45,876) (44,362) (41,247) (38,958) (37,128) (34,222) (32,116) (30,535) (29,540) Net change in total pension liability 40,225 55,566 21,256 21,855 26,514 26,531 58,318 31,111 14,870 25,802 Total pension liability - beginning 881,003 825,437 804,181 782,326 755,812 729,281 670,963 639,852 624,982 599,180 Total pension liability - ending (a)921,228$ 881,003$ 825,437$ 804,181$ 782,326$ 755,812$ 729,281$ 670,963$ 639,852$ 624,982$ Plan Fiduciary Net Position Contributions - employer 13,219$ 13,579$ 257,381$ 25,848$ 23,063$ 21,058$ 20,629$ 18,703$ 17,791$ 15,152$ Contributions - employee 4,949 4,985 4,395 4,355 4,337 4,164 4,570 4,058 4,110 3,850 Investment income 47,901 (65,933) 133,170 25,784 32,776 39,336 48,413 2,144 9,661 66,805 Administrative Expense (580) (549) (532) (731) (355) (736) (640) (270) (497) (555) Benefit payments (49,495) (45,876) (44,362) (41,247) (38,958) (37,128) (34,222) (32,116) (30,535) (29,540) Net Plan to Plan Resource Movement (1) - - - 13 (3) - (29) - - Other - - - - 1 (1,398) - - - - Net change in plan fiduciary net position 15,993 (93,794) 350,052 14,009 20,877 25,293 38,750 (7,510) 530 55,712 Plan fiduciary net position - beginning 788,911 882,705 532,653 518,644 497,767 472,474 433,724 441,234 440,704 384,992 Plan fiduciary net position - ending (b)804,904$ 788,911$ 882,705$ 532,653$ 518,644$ 497,767$ 472,474$ 433,724$ 441,234$ 440,704$ Net pension liability - beginning 92,092 (57,268) 271,528 263,682 258,045 256,807 237,239 198,618 184,278 214,188 Net pension liability (asset) - ending (a)-(b)116,324$ 92,092$ (57,268)$ 271,528$ 263,682$ 258,045$ 256,807$ 237,239$ 198,618$ 184,278$ Plan fiduciary net position as a percentage of the total pension liability (asset)87.37% 89.55% 106.94% 66.24% 66.30% 65.86% 64.79% 64.64% 68.96% 70.51% Covered payroll 48,194$ 48,023$ 45,665$ 43,783$ 43,684$ 43,371$ 43,283$ 42,619$ 42,252$ 38,397$ Net pension liability as a percentage of covered payroll 241.37% 191.77% N/A 620.17% 603.61% 594.97% 593.32% 556.65% 470.08% 479.93% Notes to Schedule: * For covered payroll, the measurement period of July 1, 2022 to June 30, 2023 was used. Changes in assumptions: There were no assumption changes in 2023. Effective with the June 30, 2021 valuation date (June 30, 2022 measurement date), the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. In addition, demographic assumptions and the price inflation assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The accounting discount rate was 7.15% for measurement dates June 30, 2017 through June 30, 2021, 7.65% for measurement dates June 30, 2015 through June 30, 2016, and 7.50% for measurement date June 30, 2014. Benefit changes: the figures above include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date. However, offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes) that occurred after the Valuation Date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary. In 2022, SB 1168 increased the standard retiree lump sum death benefit from $500 to $2,000 for any death occurring on or after July 1, 2023. The impact, if any, is included in the changes of benefit terms. City of Huntington Beach Required Supplementary Information (Unaudited) Schedule of Changes in the Net Pension Liability and Related Ratios During the Measurement Period Last Ten Fiscal Years CalPERS City Safety Plan - 100 124 296 Total Pension Liability 2023-24 2022-23 2021-22 2020-21 2019-20 2018-19 2017-18** 2016-17 2015-16 2014-15 Service cost 203$ 237$ 299$ 350$ 338$ 398$ 344$ 487$ 552$ 495$ Interest on total pension liability 3,848 3,934 3,897 4,292 3,954 3,990 2,964 3,976 3,945 3,919 Differences between expected and actual experience 781 - 492 - 4,594 - (794) - 982 - Changes in assumptions (1,375) - (1,638) 6,547 1,756 - 2,115 1,515 2,928 - Benefit payments, including refunds of employee contributions (5,711) (5,712) (5,668) (5,494) (5,012) (4,771) (3,388) (4,144) (3,773) (3,588) Net change in total pension liability (2,254) (1,541) (2,618) 5,695 5,630 (383) 1,241 1,834 4,634 826 Total pension liability - beginning 72,610 74,151 76,769 71,074 65,444 65,827 64,586 62,752 58,118 57,292 Total pension liability - ending (a)70,356$ 72,610$ 74,151$ 76,769$ 71,074$ 65,444$ 65,827$ 64,586$ 62,752$ 58,118$ Plan Fiduciary Net Position Contributions - employer 1,422$ 6,046$ 6,006$ 1,435$ 3,506$ 4,962$ 3,507$ 5,346$ 7,277$ 4,678$ Investment income 6,954 4,823 (11,362) 15,717 2,114 2,582 2,128 6,373 4,282 (1,313) Administrative Expense (350) (334) (338) (314) (444) (191) (145) (182) (189) (170) Benefit payments (5,711) (5,712) (5,668) (5,494) (5,012) (4,771) (3,388) (4,144) (3,773) (3,588) Section 115 Trust Segregation - - - - - - (3,788) - - - Other - - - - - - - - - 3,183 Net change in plan fiduciary net position 2,315 4,823 (11,362) 11,344 164 2,582 (1,686) 7,393 7,597 2,790 Plan fiduciary net position - beginning 63,822 58,999 70,361 59,017 58,853 56,271 57,957 50,564 42,967 40,177 Plan fiduciary net position - ending (b)66,137$ 63,822$ 58,999$ 70,361$ 59,017$ 58,853$ 56,271$ 57,957$ 50,564$ 42,967$ Net pension liability - beginning 8,788 15,152 6,408 12,057 6,591 9,556 6,629 12,188 15,151 17,115 Net pension liability - ending (a)-(b)4,219$ 8,788$ 15,152$ 6,408$ 12,057$ 6,591$ 9,556$ 6,629$ 12,188$ 15,151$ Plan fiduciary net position as a percentage of the total pension liability 94.00% 87.90% 79.57% 91.65% 83.04% 89.93% 85.48% 89.74% 80.58% 73.93% Covered payroll 5,590$ 5,497$ 6,670$ 7,684$ 8,469$ 12,863$ 10,890$ 17,167$ 19,517$ 22,069$ Net pension liability as a percentage of covered payroll 75.47%159.87% 227.17% 83.39% 142.37% 51.24% 87.75% 38.61% 62.45% 68.65% ** The 2017-18 period reflects nine months of activity only as the fiscal year change resulted in a nine-month reporting period from October 1, 2017 to June 30, 2018. Supplemental Retirement Plan (in Thousands) Last Ten Fiscal Years Schedule of Changes in the Net Pension Liability and Related Ratios During the Measurement Period City of Huntington Beach Required Supplementary Information 125 297 City of Huntington Beach Required Supplementary Information Schedule of Changes in Net OPEB Liability and Related Ratios For the Measurement Periods Ended June 30 (in Thousands) Measurement Period 2023 2022 2021 2020 2019 2018 2017 Total OPEB Liability Service cost 968$ 1,004$ 1,120$ 1,096$ 1,241$ 1,205$ 877$ Interest on the total OPEB liability 1,709 1,655 2,119 2,064 1,859 1,787 1,293 Actual and expected experience difference (3,372) - (6,296) - 1,411 - - Changes in assumptions 503 (891) 1,603 (298) (3,358) - - Benefit payments (1,870) (2,352) (2,129) (1,848) (1,742) (1,683) (1,036) Net change in total OPEB liability (2,062) (584) (3,583) 1,014 (589) 1,309 1,134 Total OPEB liability - beginning 29,692 30,276 33,859 32,845 33,434 32,125 30,991 Total OPEB liability - ending (a) 27,630$ 29,692$ 30,276$ 33,859$ 32,845$ 33,434$ 32,125$ Plan Fiduciary Net Position Contribution - employer** 1,997$ 2,499$ 1,882$ 1,959$ 2,270$ 4,191$ 1,036$ Net investment income 1,130 (4,561) 6,025 1,580 1,901 1,126 471 Benefit payments (1,870) (2,352) (2,129) (1,848) (1,742) (1,683) (1,036) Administrative expense (136) (156) (131) (245) (61) (131) (9) Net change in plan fiduciary net position 1,121 (4,570) 5,647 1,446 2,368 3,503 462 Plan fiduciary net position - beginning 31,716 36,286 30,639 29,193 26,825 23,322 22,860 Plan fiduciary net position - ending (b) 32,837$ 31,716$ 36,286$ 30,639$ 29,193$ 26,825$ 23,322$ Net OPEB liability (asset) - ending (a)-(b) (5,207)$ (2,024)$ (6,010)$ 3,220$ 3,652$ 6,609$ 8,803$ Plan fiduciary net position as a percentage of the total OPEB liability (asset)118.85% 106.82% 119.85%90.49%88.88%80.23%72.60% Covered employee payroll 72,558$ 72,524$ 70,881$ 76,521$ 79,682$ 81,458$ 60,985$ Net OPEB liability as a percentage of covered employee payroll N/A N/A N/A 4.21%4.58%8.11%14.43% Notes to Schedule: * Fiscal year 2017/18 was the first year of implementation, therefore only seven years of information are shown. **Contributions to the OPEB plan are not based on employee pay. Last Ten Fiscal Years* Other Post Employment Benefits Plan 126 298 2023-24 1 2022-23 1 2021-22 1 2020-21 1 2019-20 1 2018-19 1 2017-18 1, 2 2016-17 1 2015-16 1 2014-15 1 Actuarially determined contribution 5,808$ 7,451$ 6,951$ 18,086$ 16,878$ 14,819$ 9,734$ 11,921$ 11,238$ 10,510$ Contributions in relation to the actuarially determined contributions (5,808) (7,451) (6,951) (18,086) (16,878) (14,819) (9,734) (11,921) (11,238) (10,510) Contribution deficiency (excess)-$ -$ -$ -$ -$ -$ -$ -$ -$ -$ Covered payroll 52,161$ 51,089$ 46,824$ 45,740$ 45,952$ 45,419$ 33,210$ 45,118$ 44,253$ 46,337$ Contributions as a percentage of covered payroll 11.13% 14.58% 14.84% 39.54% 36.73% 32.63% 29.31% 26.42% 25.39% 22.68% Notes to Schedule Valuation date: 6/30/2013 through 06/30/2022 Methods and assumptions used to determine contribution rates: Actuarial cost method Entry Age Normal Amortization method/period Asset valuation method Inflation Salary increases Varies by entry age and service Payroll growth Discount Rate Retirement age Mortality Last Ten Fiscal Years CalPERS City Miscellaneous Plan - 99 City of Huntington Beach Required Supplementary Information Schedule of Contributions For the Year Ended June 30, 2024 (in Thousands) Note: The CalPERS Board of Administration has adopted a new amortization policy effective with the June 30, 2019 actuarial valuation. The new policy shortens the period over which actuarial gains and losses are amortized from 30 years to 20 years with the payments computed using a level dollar amount. In addition, the new policy removes the 5-year ramp-up and ramp-down on UAL bases attributable to assumption changes and non-investment gains/losses. The new policy removes the 5-year ramp-down on investment gains/losses. These changes will apply only to new UAL bases established on or after June 30, 2019. *Beginning with the June 30, 2013 valuations, CalPERS employed an amortization and smoothing policy that will pay for all gains and losses over a fixed 30-year period with the increases or decreases in the rate spread directly over a 5-year period. For 10/1/13-6/30/16, the probabilities of mortality are based on the 2010 CalPERS Experience Study for the period from 1997 to 2007. For 7/1/16- 6/30/19, the probabilities of mortality are based on the 2014 CalPERS Experience Study for the period from 1997 to 2011. For 7/1/16-6/30/18, Pre-retirement and Post-retirement mortality rates include 5 years of projected mortality improvement using Scale AA published by the Society of Actuaries. For 7/1/18-6/30/19, Pre-retirement and Post-retirement mortality rates include 20 years of projected mortality improvement using Scale BB published by the Society of Actuaries. For 7/1/19-6/30/23, the probabilities of mortality are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. Pre-retirement and Post-retirement mortality rates include 15 years of projected mortality improvement using 90% of Scale MP-2016 published by the Society of Actuaries. For 10/1/13-6/30/16, the probabilities of retirement are based on the 2014 CalPERS Experience study for the period from 1997 to 2007. For 7/1/16-6/30/19, the probabilities of retirement are based on the 2014 CalPERS Experience study for the period from 1997 to 2011. For 7/1/19- 6/30/23, the probabilities of Retirement are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. The prescribed discount rate assumption, adopted by the board on November 17, 2021, is 6.90 percent compounded annually (net of investment and administrative expenses) as of June 30, 2023. 2.75% for 10/1/2013-6/30/2020, and 2.80% for 7/1/2020-6/30/2023. 2.75% for 10/1/2013-6/30/2019, 2.50% for 7/1/2019-6/30/2020, and 2.30% for 7/1/2020-6/30/2023. For 10/1/14-6/30/15, 15 Year Smoothed Market (for details, see June 30, 2012 Funding Valuation Report). For 7/1/15-6/30/23, Fair Value (for details, see the Funding Valuation Reports for the years ended June 30, 2013-2023). For details, see Miscellaneous Plan of the City of Huntington Beach Annual Valuation Report as of June 30, 2023. 1 Historical information is required only for measurement periods for which GASB 68 is applicable. 2 The 2017-18 period reflects nine months of activity only as the fiscal year change resulted in a nine-month reporting period from October 1, 2017 to June 30, 2018. 127 299 2023-24 1 2022-23 1 2021-22 1 2020-21 1 2019-20 1 2018-19 1 2017-18 1, 2 2016-17 1 2015-16 1 2014-15 1 Actuarially determined contribution 11,484$ 13,220$ 13,579$ 27,691$ 25,847$ 23,062$ 15,223$ 19,468$ 19,129$ 18,125$ Contributions in relation to the actuarially determined contributions (11,484) (13,220) (13,579) (27,691) (25,847) (23,062) (15,223) (19,468) (19,129) (19,125) Contribution deficiency (excess)-$ -$ -$ -$ -$ -$ -$ -$ -$ (1,000)$ Covered payroll 51,351$ 48,601$ 48,023$ 45,665$ 43,783$ 43,684$ 31,943$ 43,269$ 42,607$ 44,055$ Contributions as a percentage of covered payroll 22.36% 27.20% 28.28% 60.64% 59.03% 52.79% 47.66% 44.99% 44.90% 43.41% Notes to Schedule Valuation date: 6/30/2013 through 06/30/2022 Methods and assumptions used to determine contribution rates: Actuarial cost method Entry Age Normal Amortization method/period For details, see Safety Plan of the City of Huntington Beach Annual Valuation Report as of June 30, 2023. Asset valuation method Inflation Salary increases Varies by entry age and service. Payroll growth Discount Rate Retirement age Mortality For the Year Ended June 30, 2024 Schedule of Contributions Required Supplementary Information City of Huntington Beach 2.75% for 10/1/2013-6/30/2020, and 2.80% for 7/1/2020-6/30/2022. CalPERS City Safety Plan - 100 Last Ten Fiscal Years 1 Historical information is required only for measurement periods for which GASB 68 is applicable. For 10/1/14-6/30/15, 15 Year Smoothed Market (for details, see June 30, 2012 Funding Valuation Report). For 7/1/15-6/30/23, Fair Value (for details, see the Funding Valuation Reports for the years ended June 30, 2013-2023). 2.75% for 10/1/2013-6/30/2019, 2.50% for 7/1/2019-6/30/2020, and 2.30% for 7/1/2020-6/30/2023. Note: The CalPERS Board of Administration has adopted a new amortization policy effective with the June 30, 2019 actuarial valuation. The new policy shortens the period over which actuarial gains and losses are amortized from 30 years to 20 years with the payments computed using a level dollar amount. In addition, the new policy removes the 5-year ramp-up and ramp-down on UAL bases attributable to assumption changes and non-investment gains/losses. The new policy removes the 5-year ra mp-down on investment gains/losses. These changes will apply only to new UAL bases established on or after June 30, 2019. 2 The 2017-18 period reflects nine months of activity only as the fiscal year change resulted in a nine-month reporting period f rom October 1, 2017 to June 30, 2018. The prescribed discount rate assumption, adopted by the board on November 17, 2021, is 6.90% compounded annually (net of invesment and administrative expenses) as of June 30, 2023. (in Thousands) For 10/1/13-6/30/16, the probabilities of retirement are based on the 2014 CalPERS Experience study for the period from 1997 to 2007. For 7/1/16-6/30/19, the probabilities of retirement are based on the 2014 CalPERS Experience study for the period from 1997 to 2011. For 7/1/19-6/30/23, the probabilities of Retirement are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. For 10/1/13-6/30/16, the probabilities of mortality are based on the 2010 CalPERS Experience Study for the period from 1997 to 2007. For 7/1/16-6/30/19, the probabilities of mortality are based on the 2014 CalPERS Experience Study for the period from 1997 to 2 011. For 7/1/16-6/30/18, Pre-retirement and Post-retirement mortality rates include 5 years of projected mortality improvement using Scale AA published by the Society of Actuaries. For 7/1/18-6/30/19, Pre-retirement and Post-retirement mortality rates include 20 years of projected mortality improvement using Scale BB published by the Society of Actuaries. For 7/1/19-6/30/23, the probabilities of mortality are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. Pre-retirement and Post-retirement mortality rates include 15 years of projected mortality improvement using 90% of Scale MP-2016 published by the Society of Actuaries. *Beginning with the June 30, 2013 valuations, CalPERS employed an amortization and smoothing policy that will pay for all gains and losses over a fixed 30-year period with the increases or decreases in the rate spread directly over a 5-year period. 128 300 2023-24 1 2022-23 1 2021-22 1 2020-21 1 2019-20 1 2018-19 1 2017-18 1, 2 2016-17 1 2015-16 1 2014-15 1 Actuarially determined contribution 1,388$ 1,413$ 889$ 933$ 1,689$ 2,258$ 2,879$ 3,895$ 3,576$ 3,634$ Contributions in relation to the actuarially determined contributions (1,422) (6,046) (6,006) (1,435) (3,506) (4,962) (3,507) (5,346) (7,277) (4,678) Contribution deficiency (excess)(34)$ (4,633)$ (5,117)$ (502)$ (1,817)$ (2,704)$ (628)$ (1,451)$ (3,701)$ (1,044)$ Covered payroll 5,590$ 5,497$ 6,670$ 7,684$ 8,469$ 12,863$ 10,890$ 17,167$ 19,517$ 22,069$ Contributions as a percentage of covered payroll 25.44% 109.99% 90.04% 18.68% 41.40% 38.58% 32.20% 31.14% 37.29% 21.20% Notes to Schedule Valuation date:6/30/2023 6/30/2021 6/30/2021 6/30/2019 6/30/2019 9/30/2017 9/30/2017 9/30/2015 9/30/2013 9/30/2013 Methods and assumptions used to determine contribution rates: Actuarial cost method Entry Age Normal, Level Percentage of Payroll Amortization method/period Asset valuation method Inflation 3% for 10/1/2013-6/30/2020 and 2.50% per annum for 7/1/2020-6/30/2024. Salary increases Aggregate - 2.75% annually. Merit - CalPERS 2000-2019 Experience Study. Payroll growth Investment rate of return Retirement age Mortality 2024 2023 2022 2021 2020 2019 2018 2 2017 2016 2015 Annual Money Weighted Rate of Return, net of investment expense 11.10% 8.37% -15.97% 26.88% 3.79% 4.79% 4.04% 12.87% 10.20% -2.82% The probabilities of retirement are based on the CalPERS 1997-2015 Experience Study. Investment gains/losses spread over a 3-year rolling period. 1 Historical information is required only for measurement periods for which GASB 68 is applicable. 2 The 2017-18 period reflects nine months of activity only as the fiscal year change resulted in a nine month reporting period from October 1, 2017 to June 30, 2018. Schedule of Money Weighted Rate of Return Required Supplementary Information City of Huntington Beach 1 Historical information is required only for measurement periods for which GASB 68 is applicable. 2 The 2017-18 period reflects nine months of activity only as the fiscal year change resulted in a nine-month reporting period from October 1, 2017 to June 30, 2018. Supplemental Retirement Plan Last Ten Fiscal Years* (in Thousands) For the Year Ended June 30, 2024 9/30/12 UAAL: fixed 10-year period, Gains/Losses: fixed 15-year period, Discount rate change loss: 10-year period, 6/30/18 UAAL: fixed 5-year period fresh start. 19-year closed period for 2021/2022. 20-year fixed period for 2022/23. 19-year fixed period for 2023/24. Level dollar amortization. Merit - CalPERS 1997-2011 Experience Study plus 3.25% aggregate increase for the October 1, 2013 to June 30, 2018 measurement period. 3% aggregate increase for the July 1, 2018 - June 30, 2019 measurement period. Merit - CalPERS 1997-2015 Experience Study plus 2.75% annually increase for the July 1, 2021 - June 30, 2023 period. Merit - CalPERS 2000-2019 Experience Study plus 2.75% annually increase for the July 1, 2023 - June 30, 2024 period. 6.5%, net of pension plan investment and administrative expenses, including inflation for the October 1, 2013 to June 30, 2018 measurement period. 6.25%, net of pension plan investment and administrative expenses, for the July 1, 2019 - June 30, 2022 measurement period. 5.50%, net of pension plan investment and administrative expenses, for the July 1, 2022 - June 30, 2024 measurement period. The probabilities of mortality are based on the CalPERS 1997-2015 Experience Study. Pre-retirement and Post-retirement mortality rates include mortality projected fully generational with Scale MP-2019, modified to converge to ultimate improvement rates in 2022 for the October 1, 2013 to June 30, 2018 measurement period. Mortality projected fully generational with Scale MP-2019 for the July 1, 2021 to June 30, 2022 measurement period. Mortality projected fully generational with Scale MP-2021 for the July 1, 2022 to June 30, 2024 measurement period. Schedule of Contributions 129 301 Fiscal Year Ended June 30 2024 2023 2022 2021 2020 2019 2018** Actuarially Determined Contribution (ADC)793$ 856$ 1,401$ 1,364$ 1,793$ 1,746$ 2,022$ Contributions in relation to the ADC***(935) (1,997) (2,499) (1,882) (1,959) (2,270) (4,192) Contribution deficiency (excess)(142)$ (1,141)$ (1,098)$ (518)$ (166)$ (524)$ (2,170)$ Covered-employee payroll** 74,640$ 72,558$ 72,524$ 70,881$ 76,521$ 79,682$ 59,589$ Contributions as a percentage of covered-employee payroll 1.25% 2.75% 3.45% 2.66% 2.56% 2.85% 7.03% Notes to Schedule: Valuation date: 6/30/2023 6/30/2021 6/30/2021 6/30/2019 6/30/2017 6/30/2017 6/30/2015 Methods and assumptions used to determine contributions: Actuarial Cost Method Entry Age Normal Amortization Method/Period Level percent of payroll over a 19-year fixed period Asset Valuation Method Investment gains and losses spread over 5-year fixed period. Inflation Payroll Growth 2.75% per annum, in aggregate. Investment Rate of Return Healthcare cost-trend rates Retirement Age Mortality *Historical information is required only for measurement periods for which GASB 75 is applicable. Future years' information will be displayed up to 10 years as information becomes available. **For the nine-month period ending June 30, 2018. The City changed its fiscal year effective October 1, 2017. ***Contributions to the OPEB plan are not based on employee pay. 8.50%, 1.0% - 2.0% near term increase then decreasing by 0.15%-0.60% per year to trend rate that reflects medical price inflation to an ultimate rate of 3.45% in 2076. Tier 1 employees - 2.5% @55 and Tier 2 employees - 2.0% @62. The probabilities of retirement are based on the 2014 CalPERS Experience Study for the period from 1997-2011. Tier 1 employees - 2.5% @55 and Tier 2 employees - 2.0% @ 62. The probabilities of retirement are based on the CalPERS 2000-2019-2015 experience Study for Measurement period as of 6/30/23. Pre-retirement mortality probability based on 2014 CalPERS 1997-2011 Experience Study covering CalPERS participants. Post-retirement mortality probability based on CalPERS Experience Study 2007-2011 covering participants in CalPERS. Mortality based on CalPERS 1997-2015 Experience Study covering participants in CalPERS. For the Year Ended June 30, 2024 3% for 10/1/17-6/30/18 and 2.75% per annum for the measurement period 7/1/2018 to 6/30/2022. 2.50% per annum for the measurement period 7/1/2022 to 6/30/2024. 6% for the October 1, 2017 - June 30, 2018 period. 6.25% for the July 1, 2018 - June 30, 2020. 5.50% for the July 1, 2020 - June 30, 2021 period. 5.75% for the July 1, 2021 to June 30, 2023 period. Assumes investing in California Employers' Retiree Benefit Trust asset allocation Strategy 3, moving to Strategy 2 beginning March 2019. Last Ten Fiscal Years* Other Post Employment Benefits Plan (in Thousands) City of Huntington Beach Required Supplementary Information Schedule of Contributions 130 302 SUPPLEMENTARY INFORMATION 131 303 City of Huntington Beach Other Governmental Funds Special Revenue Funds account for revenues and expenditures legally constrained to a specific purpose. x The Air Quality Fund accounts for revenues from the local agencies used to improve local air quality. x The Development Impact Fee Fund accounts for fees collected for new developments to be used for transportation, park land acquisition and development, library and other public facilities in an effort to mitigate the impacts of those new developments. x The Disability Access Fund accounts for the State Mandated Disability Access Fee (SB 1186) to fund increased training certified access specialist (CASp) services for the public and to facilitate compliance with construction related accessibility requirements. x The Drainage Fund accounts for fees received from developers to construct and maintain the City’s drainage system. x The Strand Parking Structure Fund accounts for the activities of the Strand Parking Structure. x The Gas Tax Fund accounts for monies allocated under the Streets and Highways Code of California. Expenditures may be made for any street related purpose allowed under the code. x The Housing Residual Receipt Fund accounts for residual receipts received for housing activities. x The Park Acquisition and Development Fund accounts for fees received from developers to develop and maintain the City’s park system. x The Surf City “3” Fund accounts for revenues and expenditures related to a 1% fee on cable television and other video subscription services to fund the purchase and acquisition of capital equipment and facilities necessary to program and broadcast PEG (public, education and government) events on the City’s cable channel. x The ELM Automation Fund accounts for automation fee revenues and Enterprise Land Management (ELM) replacement costs and maintenance expenditures. x The Traffic Congestion Relief Fund accounts for moneys allocated for roadway maintenance as established by Assembly Bill 2928. x The Traffic Impact Fee Fund accounts for moneys received from the traffic impact fee levied on new developments in the City. x The Transportation Fund accounts for moneys received from the countywide half cent sales tax and other specific sources to be spent on transportation related expenditures. Debt Service Funds account for the receipts for and payment of general long-term debt. x The Public Financing Authority accounts for the activity of the Huntington Beach Public Financing Authority. Capital Projects Funds account for the acquisition and construction of capital assets other than those financed by proprietary fund types. x The Affordable Housing In-Lieu Fund accounts for the Affordable Housing In-Lieu Fee from developers of housing projects who have elected to pay the fee in-lieu of building the affordable housing in their project. x The Lease Capital Project Fund records activity for leases project expenditures. x The Parking In-Lieu Fund records construction activity from developers who pay fees in-lieu of directly providing parking facilities to the City. x The Sewer Development Fund accounts for fees received from developers to construct and maintain sewer facilities. x The Technology Fund accounts for technology infrastructure project expenditures. 132 304 ASSETS Air Quality Development Impact Fee Disability Access Drainage Strand Parking Structures Gas Tax Cash and Investments 807$ 6,957$ 470$ 3,609$ 4,125$ 7,839$ Taxes Receivable - - - - - 318 Other Receivables 154 45 3 24 27 943 Total Assets 961 7,002 473 3,633 4,152 9,100 LIABILITIES Accounts Payable 51 100 2 37 - 330 Accrued Payroll - 3 - - - 20 Total Liabilities 51 103 2 37 - 350 DEFERRED INFLOWS OF RESOURCES Unavailable Revenue 82 - - - - - Total Deferred Inflows of Resources 82 - - - - - FUND BALANCES Restricted Pollution Remediation - - - - - - Highways, Streets and Transportation - - - - - 8,750 Low Income Housing - - - - - - Air Quality 828 - - - - - Other Capital Projects - 6,899 - 3,596 - - Other Purposes - - 471 - - - Committed Parks - - - - - - Other Purposes - - - - 4,152 - Total Fund Balances 828 6,899 471 3,596 4,152 8,750 961$ 7,002$ 473$ 3,633$ 4,152$ 9,100$ Total Liabilities, Deferred Inflows of Resources and Fund Balances SPECIAL REVENUE FUNDS CITY OF HUNTINGTON BEACH COMBINING BALANCE SHEET OTHER GOVERNMENTAL FUNDS June 30, 2024 (In Thousands) 133 305 Housing Residual Receipt Park Acquisition and Development Surf City "3" ELM Automation Fund Traffic Congestion Relief Traffic Impact Fee Transportation Total Special Revenue Funds 2,165$ 7,030$ 1,965$ 1,034$ 1,601$ 4,355$ 4,681$ 46,638$ - - 199 - 151 - 730 1,398 9 448 11 6 19 28 30 1,747 2,174 7,478 2,175 1,040 1,771 4,383 5,441 49,783 - - 52 18 288 78 278 1,234 - - - 3 - - 26 52 - - 52 21 288 78 304 1,286 - - - - - - - 82 - - - - - - - 82 - 336 - - - - - 336 - - - - 1,483 4,305 5,137 19,675 2,174 - - - - - - 2,174 - - - - - - - 828 - - - - - - - 10,495 - - 2,123 1,019 - - - 3,613 - 7,142 - - - - - 7,142 - - - - - - - 4,152 2,174 7,478 2,123 1,019 1,483 4,305 5,137 48,415 2,174$ 7,478$ 2,175$ 1,040$ 1,771$ 4,383$ 5,441$ 49,783$ June 30, 2024 (In Thousands) (continued) SPECIAL REVENUE FUNDS CITY OF HUNTINGTON BEACH COMBINING BALANCE SHEET OTHER GOVERNMENTAL FUNDS 134 306 ASSETS Public Financing Authority Total Debt Service Fund Affordable Housing In-Lieu Lease Capital Project Cash and Investments 3,399$ 3,399$ 10,066$ -$ Cash and Investments with Fiscal Agent 1,115 1,115 - 2,466 Taxes Receivable - - - - Other Receivables - - 65 22 Prepaids - - - 4,576 Total Assets 4,514 4,514 10,131 7,064 LIABILITIES Accounts Payable 2 2 - - Accrued Payroll - - - - Total Liabilities 2 2 - - DEFERRED INFLOWS OF RESOURCES Unavailable Revenue - - - - Total Deferred Inflows of Resources - - - - FUND BALANCES Restricted Pollution Remediation - - - - Debt Service 4,512 4,512 - - Highways, Streets and Transportation - - - - Low Income Housing - - 10,131 - Air Quality - - - - Other Capital Projects - - - 7,064 Other Purposes - - - - Committed Parks - - - - Other Capital Projects - - - - Other Purposes - - - - Assigned Capital Improvement Reserve - - - - Total Fund Balances 4,512 4,512 10,131 7,064 4,514$ 4,514$ 10,131$ 7,064$ CITY OF HUNTINGTON BEACH COMBINING BALANCE SHEET OTHER GOVERNMENTAL FUNDS June 30, 2024 (In Thousands) Total Liabilities, Deferred Inflows of Resources and Fund Balances DEBT SERVICE FUNDS CAPITAL PROJECT FUNDS (continued) 135 307 Parking In-Lieu Sewer Development Technology Total Capital Projects Funds Total Other Governmental Funds 936$ 1,959$ 6,143$ 19,104$ 69,141$ - - - 2,466 3,581 - - - - 1,398 3 13 35 138 1,885 - - 589 5,165 5,165 939 1,972 6,767 26,873 81,170 - 45 5 50 1,286 - - - - 52 - 45 5 50 1,338 - - - - 82 - - - - 82 - - - - 336 - - - - 4,512 - - - - 19,675 - - - 10,131 12,305 - - - - 828 - - - 7,064 17,559 - - - - 3,613 - - - - 7,142 939 1,927 - 2,866 2,866 - - - - 4,152 - - 6,762 6,762 6,762 939 1,927 6,762 26,823 79,750 939$ 1,972$ 6,767$ 26,873$ 81,170$ (continued) CITY OF HUNTINGTON BEACH COMBINING BALANCE SHEET OTHER GOVERNMENTAL FUNDS June 30, 2024 (In Thousands) CAPITAL PROJECT FUNDS 136 308 REVENUES Air Quality Development Impact Fee Disability Access Drainage Strand Parking Structures Gas Tax Sales Taxes -$ -$ -$ -$ -$ -$ Other Taxes - - - - - - Licenses and Permits - - 72 - - - Use of Money and Property (Loss)18 189 12 222 1,758 160 Intergovernmental 229 - - - - 8,737 Charges for Current Service - 659 - 412 - - Other - - - - - - Total Revenues 247 848 84 634 1,758 8,897 EXPENDITURES Current: City Manager - - - - - - Finance - - 24 - - - Community Development - - - - 1,051 - Information Systems - - - - - - Police - 846 - - - - Community Services - 1,274 - - - - Library Services - 52 - - - - Public Works 457 - - 1,167 - 4,943 Total Expenditures 457 2,172 24 1,167 1,051 4,943 Excess Of Revenues Over (Under) Expenditures (210) (1,324) 60 (533) 707 3,954 Other Financing Sources (Uses): Transfers In - - - - - - Transfers Out - - - - (465) - Total Other Financing Sources (Uses) - - - - (465) - Net Change in Fund Balances (210) (1,324) 60 (533) 242 3,954 Fund Balances - Beginning of Year 1,038 8,223 411 4,129 3,910 4,796 Fund Balances - End of Year 828$ 6,899$ 471$ 3,596$ 4,152$ 8,750$ CITY OF HUNTINGTON BEACH COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OTHER GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) SPECIAL REVENUE FUNDS 137 309 Housing Residual Receipt Park Acquisition and Development Surf City "3" ELM Automation Fund Traffic Congestion Relief Traffic Impact Fee Transportation Total Special Revenue Funds -$ -$ -$ -$ -$ -$ 4,582$ 4,582$ - - 441 - - - - 441 - - - - - 7 - 79 36 275 42 29 39 110 113 3,003 760 - - - 1,805 - - 11,531 - 1,559 - 610 - 138 - 3,378 77 - - - 8 - - 85 873 1,834 483 639 1,852 255 4,695 23,099 - - 487 - - - - 487 - - - - - - - 24 - - - - - - - 1,051 - - - 271 - - - 271 - - - - - - - 846 - 8 - - - - - 1,282 - - - - - - - 52 - - - - 1,699 131 3,508 11,905 - 8 487 271 1,699 131 3,508 15,918 873 1,826 (4) 368 153 124 1,187 7,181 - - 1,169 - - - - 1,169 - - (612) - - - - (1,077) - - 557 - - - - 92 873 1,826 553 368 153 124 1,187 7,273 1,301 5,652 1,570 651 1,330 4,181 3,950 41,142 2,174$ 7,478$ 2,123$ 1,019$ 1,483$ 4,305$ 5,137$ 48,415$ CITY OF HUNTINGTON BEACH COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES (In Thousands) (continued) SPECIAL REVENUE FUNDS OTHER GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 138 310 REVENUES Public Financing Authority Total Debt Service Funds Affordable Housing In-Lieu Lease Capital Project Sales Taxes -$ -$ -$ -$ Other Taxes - - - - Licenses and Permits - - 70 - Use of Money and Property (Loss) 45 45 470 356 Intergovernmental - - - - Charges for Current Service - - - - Other - - 1 - Total Revenues 45 45 541 356 EXPENDITURES Current: City Manager - - - - Finance 7 7 - - Community Development - - - - Fire - - - 4,635 Information Systems - - - - Police - - - - Community Services - - - - Library Services - - - - Public Works - - - - Debt Service: Principal 2,250 2,250 - - Interest 705 705 - - Total Expenditures 2,962 2,962 - 4,635 Excess Of Revenues Over (Under) Expenditures (2,917) (2,917) 541 (4,279) Other Financing Sources (Uses): Transfers In 2,968 2,968 - - Transfers Out - - - - Total Other Financing Sources (Uses) 2,968 2,968 - - Net Change in Fund Balances 51 51 541 (4,279) Fund Balances - Beginning of Year 4,461 4,461 9,590 11,343 Fund Balances - End of Year 4,512$ 4,512$ 10,131$ 7,064$ CITY OF HUNTINGTON BEACH COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OTHER GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 DEBT SERVICE FUNDS CAPITAL PROJECT FUNDS (In Thousands) (continued) 139 311 Parking In-Lieu Sewer Development Technology Total Capital Projects Funds Total Other Governmental Funds -$ -$ -$ -$ 4,582$ - - - - 441 244 - - 314 393 - 141 314 1,281 4,329 - 12 - 12 11,543 - 161 - 161 3,539 - 12 - 13 98 244 326 314 1,781 24,925 - - - - 487 - - - - 31 74 - - 74 1,125 - - - 4,635 4,635 - - 749 749 1,020 - - - - 846 - - - - 1,282 - - - - 52 - 826 - 826 12,731 - - - - 2,250 - - - - 705 74 826 749 6,284 25,164 170 (500) (435) (4,503) (239) - - 1,000 1,000 5,137 - - - - (1,077) - - 1,000 1,000 4,060 170 (500) 565 (3,503) 3,821 769 2,427 6,197 30,326 75,929 939$ 1,927$ 6,762$ 26,823$ 79,750$ CITY OF HUNTINGTON BEACH COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OTHER GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) (continued) CAPITAL PROJECT FUNDS 140 312 REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property -$ -$ 18$ 18$ Intergovernmental 250 529 229 (300) Total Revenues 250 529 247 (282) EXPENDITURES: Current: Public Works 388 1,605 457 1,148 Total Expenditures 388 1,605 457 1,148 Net Change in Fund Balance (138) (1,076) (210) 866 Fund Balance - Beginning of Year 1,038 1,038 1,038 - Fund Balance - End of Year 900$ (38)$ 828$ 866$ REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property -$ -$ 189$ 189$ Charges for Current Service 915 915 659 (256) Total Revenues 915 915 848 (67) EXPENDITURES: Current: Fire - 826 - 826 Police - 1,188 846 342 Community Services 503 2,602 1,274 1,328 Library Services - 299 52 247 Total Expenditures 503 4,915 2,172 2,743 Net Change in Fund Balance 412 (4,000) (1,324) 2,676 Fund Balance - Beginning of Year 8,223 8,223 8,223 - Fund Balance - End of Year 8,635$ 4,223$ 6,899$ 2,676$ REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Licenses and Permits 84$ 84$ 72$ (12)$ Use of Money and Property - - 12 12 Total Revenues 84 84 84 - EXPENDITURES: Current: Finance 84 84 24 60 Total Expenditures 84 84 24 60 Net Change in Fund Balance - - 60 60 Fund Balance - Beginning of Year 411 411 411 - Fund Balance - End of Year 411$ 411$ 471$ 60$ CITY OF HUNTINGTON BEACH SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL OTHER GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) Air Quality Development Impact Fee Disability Access 141 313 REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property -$ -$ 222$ 222$ Charges for Current Service 200 200 412 212 Total Revenues 200 200 634 434 EXPENDITURES: Current: Public Works 424 4,229 1,167 3,062 Total Expenditures 424 4,229 1,167 3,062 Net Change in Fund Balance (224) (4,029) (533) 3,496 Fund Balance - Beginning of Year 4,129 4,129 4,129 - Fund Balance - End of Year 3,905$ 100$ 3,596$ 3,496$ Strand Parking Structure REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property 1,615$ 1,615$ 1,758$ 143$ Total Revenues 1,615 1,615 1,758 143 EXPENDITURES: Current: Community Development 1,244 1,368 1,051 317 Total Expenditures 1,244 1,368 1,051 317 OTHER FINANCING SOURCES (USES): Transfers Out (465) (465) (465) - Total Other Financing Sources (Uses) (465) (465) (465) - Net Change in Fund Balance (94) (218) 242 460 Fund Balance - Beginning of Year 3,910 3,910 3,910 - Fund Balance - End of Year 3,816$ 3,692$ 4,152$ 460$ REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property -$ -$ 160$ 160$ Intergovernmental 8,612 8,612 8,737 125 Total Revenues 8,612 8,612 8,897 285 EXPENDITURES: Current: Public Works 7,659 12,342 4,943 7,399 Total Expenditures 7,659 12,342 4,943 7,399 OTHER FINANCING SOURCES (USES): Transfers Out (106) - - - Total Other Financing Sources (Uses) (106) - - - Net Change in Fund Balance 847 (3,730) 3,954 7,684 Fund Balance - Beginning of Year 4,796 4,796 4,796 - Fund Balance - End of Year 5,643$ 1,066$ 8,750$ 7,684$ Drainage CITY OF HUNTINGTON BEACH SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL OTHER GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) Gas Tax 142 314 REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property -$ -$ 36$ 36$ Intergovernmental - - 760 760 Other 30 30 77 47 Total Revenues 30 30 873 843 EXPENDITURES: Current: Community Development 30 31 - 31 Total Expenditures 30 31 - 31 Net Change in Fund Balance - (1) 873 874 Fund Balance - Beginning of Year 1,301 1,301 1,301 - Fund Balance - End of Year 1,301$ 1,300$ 2,174$ 874$ REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property (Loss) -$ -$ 275$ 275$ Charges for Current Service 400 400 1,559 1,159 Total Revenues 400 400 1,834 1,434 EXPENDITURES: Current: Community Services 554 562 8 554 Total Expenditures 554 562 8 554 Net Change in Fund Balance (154) (162) 1,826 1,988 Fund Balance - Beginning of Year 5,652 5,652 5,652 - Fund Balance - End of Year 5,498$ 5,490$ 7,478$ 1,988$ REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Other Taxes 490$ 490$ 441$ (49)$ Use of Money and Property - - 42 42 Total Revenues 490 490 483 (7) EXPENDITURES: Current: City Manager 490 707 487 220 Total Expenditures 490 707 487 220 EXCESS OF REVENUES OVER (UNDER) EXPENDITURES - (217) (4) 213 OTHER FINANCING SOURCES (USES): Transfers In - 1,169 1,169 - Transfers Out - (764) (612) 152 Total Other Financing Sources (Uses) - 405 557 152 Net Change in Fund Balance - 188 553 365 Fund Balance - Beginning of Year 1,570 1,570 1,570 - Fund Balance - End of Year 1,570$ 1,758$ 2,123$ 365$ Surf City "3" CITY OF HUNTINGTON BEACH SCHEDULE OF REVENUES, EXPENDITURES, AND FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) Park Acquisition and Development CHANGES IN FUND BALANCES - BUDGET AND ACTUAL OTHER GOVERNMENTAL FUNDS Housing Residual Receipt 143 315 REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property -$ -$ 29$ 29$ Charges for Current Service 400 400 610 210 Total Revenues 400 400 639 239 EXPENDITURES: Current: Information Systems 435 435 271 164 Total Expenditures 435 435 271 164 OTHER FINANCING SOURCES (USES): Transfers Out (18) - - - Total Other Financing Sources (Uses) (18) - - - Net Change in Fund Balance (53) (35) 368 403 Fund Balance - Beginning of Year 651 651 651 - Fund Balance - End of Year 598$ 616$ 1,019$ 403$ REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property -$ -$ 39$ 39$ Intergovernmental 1,971 1,971 1,805 (166) Other - - 8 8 Total Revenues 1,971 1,971 1,852 (119) EXPENDITURES: Current: Public Works 2,140 3,077 1,699 1,378 Total Expenditures 2,140 3,077 1,699 1,378 Net Change in Fund Balance (169) (1,106) 153 1,259 Fund Balance - Beginning of Year 1,330 1,330 1,330 - Fund Balance - End of Year 1,161$ 224$ 1,483$ 1,259$ REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Licenses and Permits -$ -$ 7$ 7$ Use of Money and Property - - 110 110 Charges for Current Service 100 100 138 38 Total Revenues 100 100 255 155 EXPENDITURES: Current: Public Works 496 3,170 131 3,039 Total Expenditures 496 3,170 131 3,039 Net Change in Fund Balance (396) (3,070) 124 3,194 Fund Balance - Beginning of Year 4,181 4,181 4,181 - Fund Balance - End of Year 3,785$ 1,111$ 4,305$ 3,194$ Traffic Impact Fee CITY OF HUNTINGTON BEACH (In Thousands) ELM Automation Fund Traffic Congestion Relief CHANGES IN FUND BALANCES - BUDGET AND ACTUAL OTHER GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 SCHEDULE OF REVENUES, EXPENDITURES, AND 144 316 REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Sales Taxes 4,171$ 4,171$ 4,582$ 411$ Use of Money and Property - - 113 113 Total Revenues 4,171 4,171 4,695 524 EXPENDITURES: Current: Public Works 3,324 7,866 3,508 4,358 Total Expenditures 3,324 7,866 3,508 4,358 OTHER FINANCING SOURCES (USES): Transfers Out 176 - - - Total Other Financing Sources (Uses) 176 - - - Net Change in Fund Balance 1,023 (3,695) 1,187 4,882 Fund Balance - Beginning of Year 3,950 3,950 3,950 - Fund Balance - End of Year 4,973$ 255$ 5,137$ 4,882$ REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property -$ -$ 45$ 45$ Total Revenues - - 45 45 EXPENDITURES: Current: Finance 12 12 7 5 Debt Service: Principal 2,250 2,250 2,250 - Interest 705 705 705 - Total Expenditures 2,967 2,967 2,962 5 OTHER FINANCING SOURCES (USES): Transfers In 2,968 2,968 2,968 - Total Other Financing Sources (Uses) 2,968 2,968 2,968 - Net Change in Fund Balance 1 1 51 50 Fund Balance - Beginning of Year 4,461 4,461 4,461 - Fund Balance - End of Year 4,462$ 4,462$ 4,512$ 50$ REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Licenses and Permits 2,901$ 2,901$ 70$ (2,831)$ Use of Money and Property - - 470 470 Other - - 1 1 Total Revenues 2,901 2,901 541 (2,360) Net Change in Fund Balance 2,901 2,901 541 (2,360) Fund Balance - Beginning of Year 9,590 9,590 9,590 - Fund Balance - End of Year 12,491$ 12,491$ 10,131$ (2,360)$ (In Thousands) CITY OF HUNTINGTON BEACH SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL FOR THE YEAR ENDED JUNE 30, 2024 OTHER GOVERNMENTAL FUNDS Transportation Public Financing Authority Affordable Housing In-Lieu 145 317 REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property -$ -$ 356$ 356$ Total Revenues - - 356 356 EXPENDITURES: Current: Fire - 10,818 4,635 6,183 Total Expenditures - 10,818 4,635 6,183 Net Change in Fund Balance - (10,818) (4,279) 6,539 Fund Balance - Beginning of Year 11,343 11,343 11,343 - Fund Balance - End of Year 11,343$ 525$ 7,064$ 6,539$ REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Licenses and Permits 54$ 54$ 244$ 190$ Total Revenues 54 54 244 190 EXPENDITURES: Current: Community Development 50 154 74 80 Total Expenditures 50 154 74 80 Net Change in Fund Balance 4 (100) 170 270 Fund Balance - Beginning of Year 769 769 769 - Fund Balance - End of Year 773$ 669$ 939$ 270$ REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property -$ -$ 141$ 141$ Intergovernmental 12 12 12 - Charges for Current Service 155 155 161 6 Other - - 12 12 Total Revenues 167 167 326 159 EXPENDITURES: Current: Public Works 800 1,480 826 654 Total Expenditures 800 1,480 826 654 Net Change in Fund Balance (633) (1,313) (500) 813 Fund Balance - Beginning of Year 2,427 2,427 2,427 - Fund Balance - End of Year 1,794$ 1,114$ 1,927$ 813$ Sewer Development Parking In-Lieu (In Thousands) Lease Capital Project OTHER GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 CITY OF HUNTINGTON BEACH SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL 146 318 REVENUES: Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property (Loss) -$ -$ 314$ 314$ Total Revenues - - 314 314 EXPENDITURES: Current: Information Systems - 3,004 749 2,255 Total Expenditures - 3,004 749 2,255 OTHER FINANCING SOURCES (USES): Transfers In 1,000 1,000 1,000 - Total Other Financing Sources (Uses) 1,000 1,000 1,000 - Net Change in Fund Balance 1,000 (2,004) 565 2,569 Fund Balance - Beginning of Year 6,197 6,197 6,197 - Fund Balance - End of Year 7,197$ 4,193$ 6,762$ 2,569$ Technology CITY OF HUNTINGTON BEACH SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL OTHER GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) 147 319 LMIHAF Capital Projects Fund REVENUES:Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property 200$ 200$ 790$ 590$ Intergovernmental 3,801 3,801 3,801 - Total Revenues 4,001 4,001 4,591 590 EXPENDITURES: Current: Community Development 25 2,433 1,600 833 Total Expenditures 25 2,433 1,600 833 Excess of Revenues Over (Under) Expenditures 3,976 1,568 2,991 1,423 Net Change in Fund Balance 3,976 1,568 2,991 1,423 Fund Balance - Beginning of Year 4,919 4,919 4,919 - Fund Balance - End of Year 8,895$ 6,487$ 7,910$ 1,423$ Pension Liability Debt Service Fund REVENUES:Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Property Taxes 7,000$ 7,000$ 8,880$ 1,880$ Use of Money and Property - - 767 767 Charges for Current Service 5,362 20,933 21,073 140 Other - Total Revenues 12,362 27,933 30,720 2,787 EXPENDITURES: Current: Finance - - 5 (5) Debt Service: Principal 13,575 13,575 12,640 935 Interest 8,995 8,995 8,438 557 Total Expenditures 22,570 22,570 21,083 1,487 Excess of Revenues Over (Under) Expenditures (10,208) 5,363 9,637 4,274 OTHER FINANCING SOURCES (USES): Transfers In 17,070 1,500 1,500 - Total Other Financing Sources (Uses) 17,070 1,500 1,500 - Net Change in Fund Balance 6,862 6,863 11,137 4,274 Fund Balance - Beginning of Year 24,982 24,982 24,982 - Fund Balance - End of Year 31,844$ 31,845$ 36,119$ 4,274$ CITY OF HUNTINGTON BEACH (In Thousands) SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL MAJOR GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 148 320 REVENUES:Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Use of Money and Property -$ -$ 1,474$ 1,474$ Intergovernmental - - 50 50 Other - - 67 67 Total Revenues - - 1,591 1,591 EXPENDITURES: Current: Community Services 158 225 219 6 Public Works 14,393 47,792 22,122 25,670 Total Expenditures 14,551 48,017 22,341 25,676 Excess of Revenues Over (Under) Expenditures (14,551) (48,017) (20,750) 27,267 OTHER FINANCING SOURCES (USES): Transfers In 14,900 16,749 16,749 - Transfers Out (214) - - - Total Other Financing Sources (Uses) 14,686 16,749 16,749 - Net Change in Fund Balance 135 (31,268) (4,001) 27,267 Fund Balance - Beginning of Year 33,398 33,398 33,398 - Fund Balance - End of Year 33,533$ 2,130$ 29,397$ 27,267$ (In Thousands) Infrastructure CITY OF HUNTINGTON BEACH SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL MAJOR GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 149 321 City of Huntington Beach Internal Service Funds Internal Services Funds are used to accumulate and allocate costs internally among the City’s various functions. x The Self Insurance Workers’ Comp Fund accounts for the City’s self insurance workers’ compensation program. x The Self Insurance General Liability Fund accounts for the City’s self insurance general liability program. x The Equipment Replacement Fund accounts for the City’s equipment replacement needs. 150 322 Self Insurance Workers' Comp Self Insurance General Liability Equipment Replacement Fund Internal Service Fund Total ASSETS Current Assets: Cash and Investments 24,888$ 15,712$ 14,274$ 54,874$ Other Receivables, Net 1,233 102 57 1,392 Prepaids 600 - 1,895 2,495 Total Current Assets 26,721 15,814 16,226 58,761 Non-Current Assets: Net Other Postemployment Benefits Asset 17 8 - 25 Total Non-Current Assets 17 8 - 25 Capital Assets: Buildings and Improvements - - 67 67 Machinery and Equipment - - 16,769 16,769 Less Accumulated Depreciation - - (5,634) (5,634) Total Capital Assets - - 11,202 11,202 Total Assets 26,738 15,822 27,428 69,988 DEFERRED OUTFLOWS OF RESOURCES Deferred Outflows Related to Pensions 369 - - 369 Deferred Outflows Related to Other Postemployment Benefits 19 8 - 27 Total Deferred Outflows of Resources 388 8 - 396 Total Assets and Deferred Outflows of Resources 27,126 15,830 27,428 70,384 LIABILITIES Current Liabilities: Accounts Payable 585 10 580 1,175 Accrued Payroll 4 6 - 10 Current Portion of Claims Payable 10,332 4,031 - 14,363 Current Portion of Compensated Absences 13 3 - 16 Long-Term Obligations Due Within One Year 43 - - 43 Total Current Liabilities 10,977 4,050 580 15,607 Non-Current Liabilities: Compensated Absences 35 8 - 43 Long-Term Obligations Due in More than One Year 900 - - 900 Net Pension Liability 600 - - 600 Claims Payable 40,999 5,733 - 46,732 Total Non-Current Liabilities 42,534 5,741 - 48,275 Total Liabilities 53,511 9,791 580 63,882 DEFERRED INFLOWS OF RESOURCES Deferred Inflows Related to Pensions 1 - - 1 Deferred Inflows Related to Other Postemployment Benefits 29 13 - 42 Total Deferred Inflows of Resources 30 13 - 43 NET POSITION Net Investment in Capital Assets 10,332 4,031 11,202 25,565 Restricted for: OPEB Benefits 17 8 - 25 Unrestricted (36,764) 1,987 15,646 (19,131) Total Net Position (26,415) 6,026 26,848 6,459 Total Liabilities, Deferred Inflows of Resources, and Net Position 27,126$ 15,830$ 27,428$ 70,384$ Governmental Activities CITY OF HUNTINGTON BEACH STATEMENT OF NET POSITION INTERNAL SERVICE FUNDS June 30, 2024 (In Thousands) 151 323 Self Insurance Workers' Comp Self Insurance General Liability Equipment Replacement Fund Internal Service Fund Total OPERATING REVENUES Fees and Charges for Service 15,586$ 15,569$ 5,605$ 36,760$ Other 2,081 5,106 2,171 9,358 Total Operating Revenues 17,667 20,675 7,776 46,118 OPERATING EXPENSES Supplies and Operations 2,106 358 1,905 4,369 Claims and Judgments 18,541 6,423 - 24,964 Depreciation - - 2,019 2,019 Total Operating Expenses 20,647 6,781 3,924 31,352 Operating Income (Loss) (2,980) 13,894 3,852 14,766 NON-OPERATING REVENUES (EXPENSES) Investment Income (Loss)933 552 496 1,981 Interest Expense (26) - - (26) Total Non-Operating Revenues (Expenses) 907 552 496 1,955 Income (Loss) Before Transfers (2,073) 14,446 4,348 16,721 Change in Net Position (2,073) 14,446 4,348 16,721 Net Position - Beginning of Year (24,342) (8,420) 22,500 (10,262) Net Position - Beginning of Year as Restated (24,342) (8,420) 22,500 (10,262) Net Position - End of Year (26,415)$ 6,026$ 26,848$ 6,459$ CITY OF HUNTINGTON BEACH STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION INTERNAL SERVICE FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) Governmental Activities 152 324 Self Insurance Workers' Comp Self Insurance General Liability Equipment Replacement Fund Internal Service Fund Total CASH FLOWS FROM OPERATING ACTIVITIES Cash Received from Customers and Users 16,510$ 20,613$ 7,768$ 44,891$ Cash Paid to Employees for Services (198) (156) - (354) Cash Paid to Suppliers of Goods and Services (12,791) (19,481) (2,087) (34,359) Net Cash and Investment Provided (Used) by Operating Activities 3,521 976 5,681 10,178 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Debt Service (43) - - (43) Interest Paid (26) - - (26) Net Cash and Investments Provided (Used) by Noncapital Financing Activities (69) - - (69) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Purchase of Capital Assets - - (3,812) (3,812) Net Cash and Investments Provided (Used) by Capital and Related Financing Activities - - (3,812) (3,812) CASH FLOWS FROM INVESTING ACTIVITIES Investment (Loss) 933 552 496 1,981 Net Cash and Investments Provided (Used) by Investing Activities 933 552 496 1,981 Net Increase in Cash and Investments 4,385 1,528 2,365 8,278 Cash and Investments - Beginning of Year 20,503 14,184 11,909 46,596 Cash and Investments - End of Year 24,888$ 15,712$ 14,274$ 54,874$ RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH AND INVESTMENTS PROVIDED (USED) BY OPERATING ACTIVITIES Operating Income (Loss) (2,980)$ 13,894$ 3,852$ 14,766$ Adjustments to Reconcile Operating Income (Loss) to Net Cash and Investments Provided (Used) by Operating Activities Depreciation - - 2,019 2,019 (Increase) in Other Receivables, Net (1,157) (62) (8) (1,227) Decrease in Prepaids - - (514) (514) (Increase) in Net Other Postemployment Benefits Asset (10) (5) - (15) Increase (Decrease) in Accounts Payable 232 (94) 332 470 Increase in Accrued Payroll - 2 - 2 Increase (Decrease) in Claims Payable 7,244 (12,770) - (5,526) Increase in Compensated Absences - 7 - 7 Decrease in Deferred Pension Outflow 97 - - 97 Increase in Net Pension Liability 87 - - 87 Decrease in Deferred Other Postemployment Benefits Outflow 3 2 - 5 Increase in Deferred Other Postemployment Benefits Inflow 5 2 - 7 Net Cash and Investments Provided (Used) by Operating Activities 3,521$ 976$ 5,681$ 10,178$ NONCASH INVESTING, CAPITAL, AND FINANCING ACTIVITIES There were no noncash investing, capital, or financing activities during the year ended June 30, 2024. Governmental Activities CITY OF HUNTINGTON BEACH STATEMENT OF CASH FLOWS INTERNAL SERVICE FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (In Thousands) 153 325 City of Huntington Beach Fiduciary Funds Fiduciary Funds account for assets held by the City as a custodian for other organizations or individuals. x The Community Facilities Districts Funds accounts for the debt service activity of the City’s three community facilities districts. x The Huntington Beach Business Improvement District Fund accounts for the activities of the City’s business improvement district. x The Bella Terra Parking Structure Fund accounts for the activities of the Bella Terra Parking Structure. 154 326 Custodial Funds ASSETS: Community Facilities Districts Business Improvement Districts Parking Structure - Bella Terra Total Custodial Funds Current Assets: Cash and Investments 1,463$ 806$ $ 1,793 $ 4,062 Cash with Fiscal Agent 1,638 - 1,719 3,357 Accounts Receivable, Net 16 743 17 776 Total Assets 3,117 1,549 3,529 8,195 LIABILITIES: Current Liabilities: Accounts Payable - 1,312 50 1,362 Total Current Liabilities - 1,312 50 1,362 Total Liabilities - 1,312 50 1,362 NET POSITION Restricted for: Restricted for Individuals and Organizations 3,117 237 3,479 6,833 Total Net Position 3,117$ 237$ 3,479$ 6,833$ CITY OF HUNTINGTON BEACH COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FIDUCIARY FUNDS FOR THE YEAR ENDED JUNE 30, 2024 Custodial Funds ADDITIONS Community Facilities Districts Business Improvement Districts Parking Structure - Bella Terra Total Custodial Funds Special Assessments or Special Taxes Collected from Property Owners 1,559$ -$ -$ 1,559$ Business Improvement District Taxes - 6,961 - 6,961 Parking Assessments - - 2,635 2,635 Interest Income 87 - 112 199 Total Additions 1,646 6,961 2,747 11,354 DEDUCTIONS Administrative Costs 20 - - 20 Payments to other Organizations - 6,989 1,153 8,142 Interest and Fiscal Agency Expenses 580 - 693 1,273 Principal 925 - 965 1,890 Total Deductions 1,525 6,989 2,811 11,325 Change in Net Position 121 (28) (64) 29 Net Position - Beginning of Year 2,996 265 3,543 6,804 Net Position - End of Year 3,117$ 237$ 3,479$ 6,833$ CITY OF HUNTINGTON BEACH COMBINING STATEMENT OF FIDUCIARY FUND ASSETS AND LIABILITIES FIDUCIARY FUNDS JUNE 30, 2024 155 327 City of Huntington Beach Statistical Section This part of the City of Huntington Beach’s Annual Comprehensive Report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information say about the City’s overall financial health. Financial Trends – contains trend information to help the reader understand how the City’s financial performance has changed over time. Revenue Capacity – contains information to help the reader assess the City’s most significant local revenue source, the property tax. Debt Capacity – presents information to assess the affordability of the City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future. Demographic and Economic Information – offers information to help the reader understand the environment within which the City’s financial activities take place. Operating Information – contains service and infrastructure data to help the reader understand how the City’s financial report relates to the services the City provides and the activities it performs. Unless otherwise noted, the information in these schedules is derived from the annual comprehensive financial reports for the relevant year. 156 328 Governmental Activities 2024 2023 2022 2021 2020 Net investment in capital assets 751,578$ 727,051$ 712,289$ 699,204$ 673,498$ Restricted 127,535 82,564 68,460 65,755 79,926 Unrestricted (179,145) (173,034) (223,438) (275,159) (274,523) Total Governmental Activities Net Position 699,968$ 636,581$ 557,311$ 489,800$ 478,901$ Business-Type Activities Net investment in capital assets 141,232$ 141,581$ 143,998$ 142,469$ 142,785$ Restricted 24,394 21,213 19,309 20,332 22,248 Unrestricted 31,190 36,684 34,120 39,129 38,482 Total Business-Type Activities Net Position 196,816$ 199,478$ 197,427$ 201,930$ 203,515$ Primary Government Net investment in capital assets 892,810$ 868,632$ 856,287$ 841,673$ 816,283$ Restricted 151,929 103,777 87,769 86,087 102,174 Unrestricted (147,955) (136,350) (189,318) (236,030) (236,041) Total Primary Government Net Position 896,784$ 836,059$ 754,738$ 691,730$ 682,416$ Expenses: Governmental Activities: 2024 2023 2022 2021 2020 City Council 441$ 429$ 382$ 423$ 405$ City Manager 7,699 5,780 5,412 11,163 3,328 City Treasurer 2,124 396 259 340 317 City Attorney 4,156 3,248 2,183 3,140 3,136 City Clerk 1,674 1,370 1,060 1,147 949 Finance 6,499 6,211 5,581 6,828 6,661 Human Resources**** 2,786 - - - - Community Development* 19,124 20,550 11,634 19,716 15,722 Fire 78,253 71,737 52,808 65,960 62,840 Information Services 8,682 8,565 6,469 6,230 8,643 Police 107,440 89,430 73,964 102,415 97,204 Community Services 15,176 13,389 11,517 11,365 12,539 Library Services 7,409 7,225 5,212 6,181 5,776 Public Works 51,560 49,151 42,598 40,270 45,834 Non-Departmental*** - - - - - Interest on Long-Term Debt 9,710 9,587 9,548 2,706 1,686 Total Governmental Activities 322,733 287,068 228,627 277,884 265,040 Business-Type Activities Water Utility 52,397 47,974 44,182 46,054 44,463 Sewer Service 12,213 11,422 10,390 9,284 9,828 Refuse Collection 15,543 14,935 13,738 12,936 12,609 Hazmat Service 194 103 236 241 235 Total Business-Type Activities 80,347 74,434 68,546 68,515 67,135 Total Business and Government Type Activities 403,080$ 361,502$ 297,173$ 346,399$ 332,175$ * Planning and Building departments were combined in Fiscal Year ended September 30, 2011. The combined department was later renamed to Community Development in Fiscal Year ended September 30, 2016. ** The 2018 period reflects nine months of activity only as the fiscal year change resulted in reporting period from October 1, 2017 to June 30, 2018. CITY OF HUNTINGTON BEACH CITY OF HUNTINGTON BEACH Fiscal Year Ended (In Thousands) NET POSITION BY COMPONENT - LAST TEN FISCAL YEARS June 30, June 30, CHANGES IN NET POSITION - LAST TEN FISCAL YEARS (In Thousands) Fiscal Year Ended 157 329 Governmental Activities 2019 2018**2017 2016 2015 Net investment in capital assets 664,281$ 650,466$ 646,336$ 624,180$ 615,512$ Restricted 66,089 58,537 41,888 41,555 52,270 Unrestricted (251,022) (254,528) (262,874) (222,863) (222,787) Total Governmental Activities Net Position 479,348$ 454,475$ 425,350$ 442,872$ 444,995$ Business-Type Activities Net investment in capital assets 145,696$ 143,954$ 140,478$ 142,566$ 142,616$ Restricted 21,153 25,886 30,444 32,049 28,096 Unrestricted 36,747 27,492 22,228 21,997 28,476 Total Business-Type Activities Net Position 203,596$ 197,332$ 193,150$ 196,612$ 199,188$ Primary Government Net investment in capital assets 809,977$ 794,420$ 786,814$ 766,746$ 758,128$ Restricted 87,242 84,423 72,332 73,604 80,366 Unrestricted (214,275) (227,036) (240,646) (200,866) (194,311) Total Primary Government Net Position 682,944$ 651,807$ 618,500$ 639,484$ 644,183$ Expenses: Governmental Activities: 2019 2018** 2017 2016 2015 City Council 360$ 218$ 347$ 321$ 270$ City Manager 4,501 2,063 4,691 3,849 3,302 City Treasurer 246 101 216 208 158 City Attorney 2,886 1,536 3,307 2,598 2,284 City Clerk 976 475 889 806 855 Finance 6,245 3,455 6,201 5,765 5,208 Human Resources**** 6,261 4,760 5,693 6,814 5,169 Community Development* 6,144 4,301 7,576 7,208 6,605 Fire 56,494 26,688 52,941 47,965 42,162 Information Services 7,530 4,375 7,047 6,852 6,552 Police 87,355 42,109 84,786 74,943 64,048 Community Services 13,369 6,768 15,558 9,935 13,809 Library Services 5,206 2,890 5,064 4,611 4,246 Public Works 40,803 23,898 35,373 31,791 27,979 Non-Departmental*** - 18,164 29,368 35,240 24,080 Interest on Long-Term Debt 1,823 1,467 2,063 2,119 2,245 Total Governmental Activities 240,199 143,268 261,120 241,025 208,972 Business-Type Activities Water Utility 43,405 28,414 45,940 41,643 38,614 Sewer Service 9,442 6,127 9,351 8,729 8,192 Refuse Collection 12,051 8,916 10,821 11,277 11,308 Hazmat Service 234 117 224 244 204 Total Business-Type Activities 65,132 43,574 66,336 61,893 58,318 Total Business and Government Type Activities 305,331$ 186,842$ 327,456$ 302,918$ 267,290$ *** Beginning with Fiscal Year ended June 30, 2019, non-departmental expenditures are no longer presented separately but are included as part of functional expenditures. **** Human Resources was combined with the City Manager's Office in Fiscal Year ended June 30, 2020. Human Resources was seperated in Fiscal Year ended June 30, 2024. CITY OF HUNTINGTON BEACH CITY OF HUNTINGTON BEACH NET POSITION BY COMPONENT - LAST TEN FISCAL YEARS (In Thousands) (continued) Fiscal Year Ended September 30, June 30, CHANGES IN NET POSITION - LAST TEN FISCAL YEARS (In Thousands) (continued) Fiscal Year Ended June 30, September 30, 158 330 Program Revenues: Governmental Activities: 2024 2023 2022 2021 2020 Charges for Services City Council 175$ 167$ 162$ 162$ 177$ City Manager 4,057 4,976 4,131 4,208 5,315 City Treasurer 161 153 149 149 163 City Attorney 6 5 5 6 7 City Clerk 508 299 269 30 220 Finance 3,280 3,125 3,036 3,055 3,302 Human Resources**** 7,670 - - - - Community Development* 11,102 18,817 10,953 8,353 10,037 Fire 20,228 14,166 13,401 8,877 10,122 Information Services 654 623 604 610 636 Police 5,558 6,139 6,687 6,477 5,329 Community Services 24,713 22,545 21,117 15,558 17,631 Library Services 229 388 302 153 266 Public Works 8,570 11,301 7,235 6,045 6,614 Non-Departmental*** - - - - - Total Charges for Services 86,911 82,704 68,051 53,683 59,819 Operating Grants 11,678 43,005 9,301 6,013 8,141 Capital Grants 17,266 11,202 8,537 10,192 14,483 Total Governmental Activities Program Revenue 115,855 136,911 85,889 69,888 82,443 Business-Type Activities: Water Utility 45,739 48,934 43,590 42,523 40,518 Sewer Service 11,798 10,982 10,791 10,828 10,900 Refuse Collection 15,637 14,899 13,675 13,014 12,573 Hazmat Service 302 276 276 266 279 Total Business-Type Activities Program Revenues 73,476 75,091 68,332 66,631 64,270 Total Primary Government Program Revenue 189,331 212,002 154,221 136,519 146,713 Net (Expense) Revenue: Governmental Activities (206,878) (150,157) (142,738) (207,996) (182,597) Business-Type Activities (6,871) 657 (214) (1,884) (2,865) Total Net (Expense) Revenue (213,749) (149,500) (142,952) (209,880) (185,462) General Revenue and Other Changes in Net Position Governmental Activities: Property Taxes 114,630 109,467 102,539 99,958 94,263 Sales Taxes 56,003 57,164 57,652 51,162 44,616 Utility Taxes 23,283 22,558 19,528 18,374 18,149 Other Taxes 27,024 32,418 26,134 17,293 18,635 Use of Money and Property 12,361 5,153 (1,895) 4,399 3,208 From Other Agencies 5,883 3,225 4,631 22,000 3,317 Gain on Sale of Property - (520) 1,699 - - Gain from Elimination of Allowances 31,136 - - - - Other - - - - - Transfers (55) (38) (39) (38) (38) Total Governmental Activities General Revenues 270,265 229,427 210,249 213,148 182,150 Business-Type Activities: Use of Money and Property 4,154 1,356 (4,328) 261 2,746 Transfers 55 38 39 38 38 Total Business-Type Activities General Revenues 4,209 1,394 (4,289) 299 2,784 Total General Revenues and Transfers 274,474 230,821 205,960 213,447 184,934 Changes in Net Position - Governmental Activities 63,387 79,270 67,511 5,152 (447) Changes in Net Position - Business-Type Activities (2,662) 2,051 (4,503) (1,585) (81) Total Changes in Net Position 60,725 81,321 63,008 3,567 (528) Net Position - Beginning of Year 836,059 754,738 691,730 682,416 682,944 Prior Period Adjustment - Governmental Activities - - - 5,747 - Prior Period Adjustment - Business-Type Activities - - - - - Net Position - Beginning of Year as restated 836,059 754,738 691,730 688,163 682,944 Net Position - End of Year 896,784$ 836,059$ 754,738$ 691,730$ 682,416$ * Planning and Building departments were combined in the Fiscal Year ended September 30, 2011. The combined department was later renamed to Community Development in Fiscal Year ended September 30, 2016. ** The 2018 period reflects nine months of activity only as the fiscal year change resulted in reporting period from October 1, 2017 to June 30, 2018. Fiscal Year Ended CHANGES IN NET POSITION - LAST TEN FISCAL YEARS June 30, CITY OF HUNTINGTON BEACH (In Thousands) 159 331 Program Revenues: Governmental Activities: 2019 2018** 2017 2016 2015 Charges for Services City Council 149$ 91$ 108$ 116$ 71$ City Manager 3,300 2,374 3,515 3,029 2,994 City Treasurer 135 81 100 101 639 City Attorney 7 4 5 4 143 City Clerk 327 229 257 201 199 Finance 2,899 1,746 2,047 2,277 1,353 Human Resources**** 751 373 654 513 1,263 Community Development* 7,459 5,448 7,448 9,252 10,670 Fire 9,831 9,104 10,296 9,894 8,625 Information Services 628 381 501 521 834 Police 6,044 4,703 4,968 5,958 5,512 Community Services 23,530 19,245 21,693 18,853 18,569 Library Services 308 237 476 408 495 Public Works 6,368 4,392 5,392 5,733 6,474 Non-Departmental*** - 916 1,116 1,290 327 Total Charges for Services 61,736 49,324 58,576 58,150 58,168 Operating Grants 6,644 3,976 7,329 4,723 7,458 Capital Grants 8,361 6,055 3,408 5,939 9,809 Total Governmental Activities Program Revenue 76,741 59,355 69,313 68,812 75,435 Business-Type Activities: Water Utility 43,958 29,530 39,938 35,765 35,350 Sewer Service 11,868 8,362 10,854 11,280 11,239 Refuse Collection 12,022 8,820 11,282 11,215 11,221 Hazmat Service 276 25 287 235 222 Total Business-Type Activities Program Revenues 68,124 46,737 62,361 58,495 58,032 Total Primary Government Program Revenue 144,865 106,092 131,674 127,307 133,467 Net (Expense) Revenue: Governmental Activities (163,458) (83,913) (191,807) (172,213) (133,537) Business-Type Activities 2,992 3,163 (3,975) (3,398) (286) Total Net (Expense) Revenue (160,466) (80,750) (195,782) (175,611) (133,823) General Revenue and Other Changes in Net Position Governmental Activities: Property Taxes 89,124 61,185 82,925 87,128 82,615 Sales Taxes 47,437 33,844 43,551 34,289 33,063 Utility Taxes 18,788 14,014 19,303 19,482 20,229 Other Taxes 20,227 14,883 17,991 17,313 16,464 Use of Money and Property 8,746 2,158 3,370 3,618 5,551 From Other Agencies 4,046 2,263 3,896 4,397 5,653 Gain on Sale of Property - - - - - Gain from Elimination of Allowances - - - - - Other - 2,811 2,438 5,693 4,440 Transfers (37) (332) (51) (38) 35 Total Governmental Activities General Revenues 188,331 130,826 173,423 171,882 168,050 Business-Type Activities: Use of Money and Property 3,235 279 462 939 1,281 Transfers 37 332 51 38 (35) Total Business-Type Activities General Revenues 3,272 611 513 977 1,246 Total General Revenues and Transfers 191,603 131,437 173,936 172,859 169,296 Changes in Net Position - Governmental Activities 24,873 46,913 (18,384) (331) 34,513 Changes in Net Position - Business-Type Activities 6,264 3,774 (3,462) (2,421) 960 Total Changes in Net Position 31,137 50,687 (21,846) (2,752) 35,473 Net Position - Beginning of Year 651,807 618,500 639,484 642,236 964,254 Prior Period Adjustment - Governmental Activities - (17,788) 862 - (333,677) Prior Period Adjustment - Business-Type Activities - 408 - - (23,814) Net Position - Beginning of Year as restated 651,807 601,120 640,346 642,236 606,763 Net Position - End of Year 682,944$ 651,807$ 618,500$ 639,484$ 642,236$ *** Beginning with the Fiscal Year ended June 30, 2019, non-departmental expenditures are no longer presented separately but are included as part of functional expenditures. **** Human Resources was combined with the City Manager's Office in Fiscal Year ended June 30, 2020. Human Resources was seperated in Fiscal Year ended June 30, 2024. (In Thousands) Fiscal Year Ended June 30, September 30, (continued) CHANGES IN NET POSITION - LAST TEN FISCAL YEARS CITY OF HUNTINGTON BEACH 160 332 2024 2023 2022 2021 2020 General Fund: Nonspendable 148$ 51$ 82$ 115$ 120$ Restricted 21,670 19,578 14,623 13,561 9,320 Committed 52,023 51,230 26,665 25,565 25,010 Assigned 58,478 55,678 61,454 55,368 45,638 Total General Fund 132,319$ 126,537$ 102,824$ 94,609$ 80,088$ Other Governmental Funds: Nonspendable -$ -$ -$ 105$ 50$ Restricted 105,569 87,866 75,774 70,161 71,671 Committed 43,557 45,820 28,559 26,857 21,735 Assigned 6,762 6,197 3,021 3,280 3,527 Unassigned - - (4,311) - - Total Other Governmental Funds 155,888$ 139,883$ 103,043$ 100,403$ 96,983$ 2019 2018 2017 2016 2015 General Fund: Nonspendable 23$ 41$ -$ -$ 4,479$ Restricted 8,154 6,384 2,671 2,637 2,871 Committed 25,011 25,011 25,011 25,011 25,011 Assigned 45,825 34,464 33,498 35,199 32,431 Unassigned - 2,734 - - - Total General Fund 79,013$ 68,634$ 61,180$ 62,847$ 64,792$ Other Governmental Funds: Nonspendable 64$ 726$ -$ -$ -$ Restricted 59,213 52,742 40,588 40,293 45,515 Committed 20,308 20,800 17,686 21,368 21,659 Assigned 3,614 2,701 826 838 161 Total Other Governmental Funds 83,199$ 76,969$ 59,100$ 62,499$ 67,335$ Fiscal Year Ended September 30,Fiscal Year Ended June 30, CITY OF HUNTINGTON BEACH FUND BALANCES - GOVERNMENTAL FUNDS - LAST TEN FISCAL YEARS (In Thousands) (Modified Accrual Basis of Accounting) Fiscal Year Ended June 30, 161 333 THIS PAGE INTENTIONALLY LEFT BLANK 162 334 2024 2023 2022 2021 2020 REVENUES: Property Taxes 114,630$ 109,467$ 102,539$ 99,958$ 94,263$ Sales Taxes 56,003 57,164 57,652 51,162 44,616 Utility Taxes 23,283 22,558 19,528 18,374 18,149 Other Taxes 27,465 40,738 33,720 25,745 24,578 Licenses and Permits 10,593 15,688 9,596 8,213 11,266 Fines and Forfeitures 3,666 3,945 5,144 4,619 3,403 From Use of Money and Property 37,769 22,726 14,365 19,163 27,863 From Other Agencies 38,922 47,426 13,060 29,836 11,309 Charges for Current Service/Other Revenue 59,496 66,363 52,809 27,428 34,772 TOTAL REVENUES 371,827 386,075 308,413 284,498 270,219 EXPENDITURES Current: City Council 464 453 426 1,043 394 City Manager 7,117 6,501 5,265 15,976 4,342 City Treasurer 2,059 417 326 837 297 City Attorney 3,994 3,404 2,995 7,714 2,898 City Clerk 1,653 1,442 1,295 2,810 886 Finance 5,999 7,420 7,259 16,173 6,200 Human Resources***** 2,636 - - - - Community Development** 19,412 21,569 14,412 39,212 14,692 Fire 76,247 72,499 62,880 149,726 56,477 Information Systems 8,916 8,563 7,871 19,095 8,473 Police 103,468 97,000 93,976 232,438 87,682 Community Services 14,179 16,610 18,455 25,064 14,429 Library Services 7,235 7,244 6,300 14,099 5,199 Public Works 69,169 62,161 50,158 88,007 47,655 Non-Departmental**** - - - - - Capital Outlay*** - - - - - Debt Service: Principal 20,375 18,799 15,918 3,983 5,122 Interest 9,728 9,542 11,299 937 1,748 TOTAL EXPENDITURES 352,651 333,624 298,835 617,114 256,494 EXCESS (DEFICIENCY) OF REVENUES OVER (UNDER) EXPENDITURES 19,176 52,451 9,578 (332,616) 13,725 OTHER FINANCING SOURCES (USES): Transfers In 28,764 65,369 21,642 13,058 10,009 Issuance of Long-Term Debt - - - 372,010 1,172 Issuance Premium - - - 1,743 - Issuance Discount - - - (649) - Payments to Escrow - - - (28,256) - Lease (as Lessee) - 398 448 - - Issuance of Finance Purchase Agreement - 7,742 868 - - Subscription Based IT Arrangement 2,666 - - - - Transfers Out (28,819) (65,407) (21,681) (13,096) (10,047) TOTAL OTHER FINANCING SOURCES (USES)2,611 8,102 1,277 344,810 1,134 INCREASE (DECREASE) IN FUND BALANCES 21,787$ 60,553$ 10,855$ 12,194$ 14,859$ DEBT SERVICE AS A PERCENTAGE OF NON-CAPITAL EXPENDITURES 9.7% 9.7% 10.1% 0.9% 3.0% * The 2017/18 period reflects nine months of activity only as the fiscal year change resulted in a nine month reporting p eriod from October 1, 2017 to June 30, 2018. ** Planning and Building departments were combined in Fiscal Year ended September 30, 2011. The department was later renam ed to Community Development in Fiscal Year ended September 30, 2016. *** Beginning with the Fiscal Year ended September 30, 2017, capital outlay expenditures are no longer presented separately but are included as part of functional expenditures. However, capital outlay expenditures are excluded in the calculation of debt service as a percentage of non-capital expenditures. Fiscal Year Ended June 30, CITY OF HUNTINGTON BEACH CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS - LAST TEN FISCAL YEARS (In Thousands) (Modified Accrual Basis of Accounting) 163 335 2019 2018*2017 2016 2015 REVENUES: Property Taxes 89,367$ 80,614$ 80,826$ 86,382$ 82,472$ Sales Taxes 47,437 33,844 43,551 39,305 32,234 Utility Taxes 18,788 14,014 19,303 19,482 20,229 Other Taxes 27,196 18,409 17,991 17,313 16,464 Licenses and Permits 8,574 6,293 8,812 9,820 9,270 Fines and Forfeitures 4,300 3,048 3,995 5,144 4,746 From Use of Money and Property 23,276 11,600 17,210 18,055 17,473 From Other Agencies 13,072 10,384 15,293 13,712 18,634 Charges for Current Service/Other Revenue 33,787 30,216 32,351 32,506 35,869 TOTAL REVENUES 265,797 208,422 239,332 241,719 237,391 EXPENDITURES Current: City Council 369 279 333 318 278 City Manager 6,598 3,143 4,116 3,092 2,703 City Treasurer 248 134 201 204 167 City Attorney 2,874 2,037 3,052 2,539 2,425 City Clerk 981 602 830 790 895 Finance 6,484 4,376 5,763 5,659 5,452 Human Resources***** 6,362 5,323 5,535 6,776 4,606 Community Development** 8,138 5,554 6,963 7,062 6,954 Fire 54,431 36,347 46,831 46,200 45,008 Information Systems 8,342 5,385 6,603 6,742 6,846 Police 83,546 57,916 75,015 72,612 68,940 Community Services 11,720 7,958 14,124 10,768 10,223 Library Services 4,944 3,436 4,422 4,247 4,146 Public Works 46,878 30,357 38,635 23,659 23,820 Non-Departmental***** - 22,432 28,396 24,670 20,067 Capital Outlay**** - - - 27,269 14,986 Debt Service: Principal 5,346 311 5,091 5,933 5,454 Interest 1,890 965 2,066 2,138 2,226 TOTAL EXPENDITURES 249,151 186,555 247,976 250,678 225,196 EXCESS (DEFICIENCY) OF REVENUES OVER (UNDER) EXPENDITURES 16,646 21,867 (8,644) (8,959) 12,195 OTHER FINANCING SOURCES (USES): Transfers In 11,190 13,261 6,692 9,034 12,158 Issuance of Long-Term Debt - - 2,767 10,197 Issuance Premium - - - - - Issuance Discount - - - - - Payments to Escrow - - - - - Lease (as Lessee) - - - - - Issuance of Finance Purchase Agreement - - - - - Subscription Based IT Arrangement - - - - - Transfers Out (11,227) (13,593) (6,743) (17,053) (14,238) TOTAL OTHER FINANCING SOURCES (USES)(37) (332) 2,716 2,178 (2,080) INCREASE (DECREASE) IN FUND BALANCES 16,609$ 21,535$ (5,928)$ (6,781)$ 10,115$ DEBT SERVICE AS A PERCENTAGE OF NON-CAPITAL EXPENDITURES 3.3% 0.7% 3.2% 3.6% 3.7% **** Beginning with the Fiscal Year ended June 30, 2019, non-departmental expenditures are no longer presented separately but are included as part of functional expenditures. ***** Human Resources was combined with the City Manager's Office in Fiscal Year ended June 30, 2020. Human Resources was seperated in Fiscal Year ended June 30, 2024. Fiscal Year Ended (continued) September 30, June 30, CITY OF HUNTINGTON BEACH CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS - LAST TEN FISCAL YEARS (In Thousands) (Modified Accrual Basis of Accounting) 164 336 Fiscal Year Common Property Public Utilities Total Secured Unsecured Total Assessed Valuation Total Direct Tax Rate 2014-2015 29,723,274 74,102 29,797,376 989,809 30,787,185 0.17082 2015-2016 31,193,211 66,802 31,260,013 1,132,728 32,392,741 0.17082 2016-2017 32,540,317 55,802 32,596,119 1,067,760 33,663,879 0.17082 2017-2018 34,199,035 41,102 34,240,137 1,100,077 35,340,214 0.17082 2018-2019 35,941,648 61,202 36,002,850 1,117,879 37,120,729 0.17082 2019-2020 37,741,095 518 37,741,613 1,145,838 38,887,451 0.17082 2020-2021 39,449,688 518 39,450,206 1,111,018 40,561,224 0.17082 2021-2022 40,789,946 518 40,790,464 1,041,429 41,831,893 0.17082 2022-2023 43,432,681 948 43,433,629 1,232,123 44,665,752 0.17082 2023-2024 45,689,554 948 45,690,502 1,174,043 46,864,545 0.17082 Source: County of Orange Auditor Controller Fiscal Year City Basic Rate (1), (2) City Other School Districts Metro Water District Others 2014-2015 0.15582 0.01500 0.62448 0.00350 0.29444 1.09324 2015-2016 0.15582 0.01500 0.07615 0.00350 0.84418 1.09465 2016-2017 0.15582 0.01500 0.07786 0.00350 0.83599 1.08817 2017-2018 0.15582 0.01500 0.09970 0.00350 0.84418 1.11820 2018-2019 0.15582 0.01500 0.09246 0.00350 0.84418 1.11096 2019-2020 0.15582 0.01500 0.08788 0.00350 0.84418 1.10638 2020-2021 0.15582 0.01500 0.07983 0.00350 0.84418 1.09833 2021-2022 0.15582 0.01500 0.07541 0.00350 0.84418 1.09391 2022-2023 0.15582 0.01500 0.07449 0.00350 0.84418 1.09299 2023-2024 0.15582 0.01500 0.08163 0.00350 0.84418 1.10013 Note: Rates are per $100 of assessed valuation Source: County of Orange Auditor Controller (1) Excludes rates associated with Mello-Roos Districts (2) In 1978, California voters passed Proposition 13 which sets the property tax rate at a 1% fixed amount. This 1% is shared by all taxing agencies for which the subject property resides. In 1986, the State Constitution was amended to allow rates over the 1% base rate for voter approved general obligation debt. Valuations of real property are frozen at the value of the property in 1975, with an allowable adjustment up to 2% per year for inflation. However, property is assessed to its current value when a change of ownership occurs. New construction, including tenant improvements, is assessed at its current value. Direct Total Direct and Overlapping Overlapping CITY OF HUNTINGTON BEACH ASSESSED AND ACTUAL VALUATION OF ALL TAXABLE PROPERTY (EXCLUDING REDEVELOPMENT AGENCY) LAST TEN FISCAL YEARS LAST TEN FISCAL YEARS (In Thousands) PROPERTY TAX RATES ALL DIRECT AND OVERLAPPING GOVERNMENTS TAX RATE 04-001 LARGEST AREA IN CITY 165 337 Fiscal Year Total Levy Amount Percentage of Levy Delinquent Tax Collections Amount Percentage of Levy Delinquent Taxes Receivable Delinquency Percent Secured Taxes 2014-2015 52,188 50,759 97.3% 576 51,335 98.4% 519 1.0% 2015-2016 55,886 53,916 96.5% 546 54,462 97.5% 1,263 2.3% 2016-2017 58,258 56,481 96.9% 525 57,006 97.9% 1,253 2.2% 2017-2018 62,418 59,731 95.7% 474 60,205 96.5% 2,073 3.3% 2018-2019 63,934 62,222 97.3% 622 62,844 98.3% 920 1.4% 2019-2020 66,411 64,767 97.5% 496 65,263 98.3% 1,092 1.6% 2020-2021 69,341 67,887 97.9% 626 68,513 98.8% 926 1.3% 2021-2022 72,014 69,871 97.0% 714 70,585 98.0% 1,510 2.1% 2022-2023 78,388 76,256 97.3% 547 76,803 98.0% 1,501 1.9% 2023-2024 80,457 78,570 97.7% 658 79,228 98.5% 1,205 1.5% Unsecured Taxes 2014-2015 2,016 1,839 91.2%37 1,876 93.1%69 3.4% 2015-2016 1,925 1,740 90.4%35 1,775 92.2%39 2.0% 2016-2017 1,899 1,692 89.1%23 1,715 90.3%34 1.8% 2017-2018 1,964 1,829 93.1%28 1,857 94.6%26 1.3% 2018-2019 1,964 1,804 91.9%20 1,824 92.9%29 1.5% 2019-2020 2,038 1,906 93.5%15 1,921 94.3%43 2.1% 2020-2021 2,143 1,955 91.2%26 1,981 92.4%82 3.8% 2021-2022 2,267 2,059 90.8%46 2,105 92.9%90 4.0% 2022-2023 2,233 2,102 94.1%42 2,144 96.0%59 2.6% 2023-2024 2,586 2,240 86.6%33 2,273 87.9% 174 6.7% Community Facilities Districts 2014-2015 3,981 3,967 99.6%1 3,968 99.7%2 0.1% 2015-2016 4,121 4,106 99.6%9 4,115 99.9%2 0.0% 2016-2017 4,098 4,085 99.7%2 4,087 99.7%- 0.0% 2017-2018 4,141 4,128 99.7%5 4,133 99.8%- 0.0% 2018-2019 4,099 4,086 99.7%3 4,089 99.8%1 0.0% 2019-2020 4,053 4,027 99.4%2 4,029 99.4%14 0.3% 2020-2021 3,949 3,937 99.7%- 3,937 99.7%- 0.0% 2021-2022 3,987 3,975 99.7%- 3,975 99.7%- 0.0% 2022-2023 4,006 3,962 98.9%- 3,962 98.9%31 0.8% 2023-2024 4,207 4,194 99.7%35 4,229 100.5%- 0.0% Note: The levy and tax year is for July 1st through June 30th and does not include the Redevelopment Agency. 2013/2014 to current fiscal year includes the following: Unsecured: includes aircraft unsecured tax. Does not include CFDs. Miscellaneous: excluded from all tables. Delinquency Amount: reflects the "unpaid" amounts as stated in the OC Auditor-Controller website. Secured: includes supplemental, st ltg reorg, nuisance abatement, weed abatement, retirement override, tax admin charges, and community interest. Does not include Community Facilities District CFDs. CITY OF HUNTINGTON BEACH Collected within the Fiscal Year of the Levy Total Collections Source: County of Orange Auditor Controller's Office (In Thousands) LAST TEN FISCAL YEARS PROPERTY TAX LEVIES AND COLLECTIONS 166 338 2023-2024 Taxable Assessed Value Percent (In Thousands)of Total TAV AES Huntington Beach Energy, LLC 792,053$ 1.69% Bella Terra Associates LLC 407,060 0.87% DCO Pacific City LLC 233,234 0.50% Huntington Gateway Industrial LLC 222,400 0.47% Catalyst Housing Group 219,638 0.47% PCH Beach Resort LLC 207,865 0.44% Socal Holding LLC 175,791 0.38% The Boening Company/McDonnell Douglas 172,041 0.37% The Waterfront Hotel LLC 150,837 0.32% Monogram Residential Huntington Beach 144,687 0.31% Total Top Ten 2,725,606 5.82% All Other Property Taxpayers 44,138,939 94.18% City Total 46,864,545$ 100.00% 2014-2015 Taxable Assessed Value Percent (In Thousands)of Total TAV OXY USA Inc 638,783$ 2.07% McDonnell Douglas West Federal Credit Union 338,241 1.10% Bella Terra Associates LLC 233,012 0.76% Mayer Financial LP 191,399 0.62% DCOR LLC 145,379 0.47% CIM Huntington LLC 104,148 0.34% Bella Terra Villas LLC 97,724 0.32% Pacific Sands LLC 89,024 0.29% United Dominion Realty 88,840 0.29% AES Huntington Beach LLC 74,100 0.24% Total Top Ten 2,000,650 6.50% All Other Property Taxpayers 28,786,535 93.50% City Total 30,787,185$ 100.00% Source: County of Orange Auditor Controller's Office Note: Information provided for the period from July 1st through June 30th. TOP TEN PROPERTY TAXPAYERS CURRENT YEAR AND NINE YEARS AGO CITY OF HUNTINGTON BEACH 167 339 THIS PAGE INTENTIONALLY LEFT BLANK 168 340 Long-Term Indebtedness 2024 2023 2022 2021 2020 Governmental Activities: Judgement Obligation Bonds -$ -$ -$ -$ -$ Public Financing Authority: 2010(a) Lease Revenue Bonds - - - - 7,410 2011(a) Lease Revenue Bonds - - - - 15,725 2014(a) Lease Revenue Bonds 9,810 10,530 11,215 11,880 12,530 2020(a) Lease Revenue Bonds 4,835 4,835 4,835 4,835 - 2020(b) Lease Revenue Bonds 8,265 9,795 11,315 12,830 - Total Public Financing Authority 22,910 25,160 27,365 29,545 35,665 Other Long-Term Obligations: Finance Purchase Agreement 14,290 17,388 11,714 12,753 5,241 Leases Payable 240 456 247 - - Subscriptions Payable 3,800 2,600 - - - Section 108 Loan City - - - - - LED Lighting Phase I 65 191 314 432 546 CEC 1,528 1,797 2,063 2,457 2,588 I-Bank 973 1,283 1,586 1,882 2,171 Pension Obligation Bonds 305,322 318,005 330,642 341,501 - Total Other Long-Term Obligations 326,218 341,720 346,566 359,025 10,546 Total Long-Term Obligations - Governmental Activities 349,128 366,880 373,931 388,570 46,211 Long-Term Obligations - Business-Type Activities: Pension Obligation Bonds 19,588 20,480 21,368 22,144 - Total Long-Term Obligations - Business-Type Activities 19,588 20,480 21,368 22,144 - Total Long Term Obligations - Governmental Activities and Business-Type Activities 368,716$ 387,360$ 395,299$ 410,714$ 46,211$ 2024 2023 2022 2021 2020 Population 195,332 198,373 197,437 198,039 200,748 Debt Per Capita 1,888$ 1,953$ 2,002$ 2,074$ 230$ Total Personal Income (In Thousands)* 11,847,667$ 10,841,878$ 9,995,248$ 9,659,154$ 9,450,814$ Per Capita Personal Income* 60,654$ 54,654$ 50,625$ 48,774$ 47,078$ Unemployment Rate** 3.90% 3.60% 2.80% 4.70% 8.60% Total Employment** 101,700 103,900 104,300 100,700 96,200 * Source: Claritas, Inc. ** Source: State of California Employment Development Department *** The 2017/18 period reflects nine months of activity only as the fiscal year change resulted in a nine month reporting period from October 1, 2017 to June 30, 2018. June 30, Fiscal Year Ended CITY OF HUNTINGTON BEACH RATIOS OF OUTSTANDING DEBT BY TYPE LAST TEN FISCAL YEARS (In Thousands) 169 341 September 30, Long-Term Indebtedness 2019 2018*** 2017 2016 2015 Governmental Activities: Judgement Obligation Bonds -$ -$ -$ 659$ 1,634$ Public Financing Authority: 2010(a) Lease Revenue Bonds 8,235 9,030 9,030 9,795 10,525 2011(a) Lease Revenue Bonds 17,770 19,735 19,735 21,650 24,985 2014(a) Lease Revenue Bonds 13,145 13,740 13,740 14,315 14,865 2020(a) Lease Revenue Bonds - - - - - 2020(b) Lease Revenue Bonds - - - - - Total Public Financing Authority 39,150 42,505 42,505 45,760 50,375 Other Long-Term Obligations: Finance Purchase Agreement 5,083 6,079 6,286 4,130 - Leases Payable - - - - - Subscriptions Payable - - - - - Section 108 Loan City - 430 430 625 805 LED Lighting Phase I 656 762 866 966 1,063 CEC 2,818 3,000 3,000 3,000 - I-Bank 2,454 2,730 2,730 3,000 - Pension Obligation Bonds - - - - - Total Other Long-Term Obligations 11,011 13,001 13,312 11,721 1,868 Total Long-Term Obligations - Governmental Activities 50,161 55,506 55,817 58,140 53,877 Long-Term Obligations - Business-Type Activities: Pension Obligation Bonds - - - - - Total Long-Term Obligations - Business-Type Activities - - - - - Total Long Term Obligations - Governmental Activities and Business-Type Activities 50,161$ 55,506$ 55,817$ 58,140$ 53,877$ 2019 2018*** 2017 2016 2015 Population 202,265 201,761 202,413 201,919 198,389 Debt Per Capita 248$ 275$ 276$ 288$ 272$ Total Personal Income (In Thousands)* 9,222,677$ 8,849,843$ 8,878,441$ 8,880,801$ 8,725,545$ Per Capita Personal Income* 45,597$ 43,863$ 43,863$ 43,982$ 43,982$ Unemployment Rate** 2.60% 2.70% 2.80% 3.90% 3.90% Total Employment** 107,700 106,900 103,200 107,200 104,000 June 30, Fiscal Year Ended CITY OF HUNTINGTON BEACH RATIOS OF OUTSTANDING DEBT BY TYPE LAST TEN FISCAL YEARS (In Thousands) 170 342 2014-2015 - 2015-2016 - 2016-2017 - 2017-2018 - 2018-2019 - 2019-2020 - 2020-2021 - 2021-2022 - 2022-2023 - 2023-2024 - 5,623,745 5,623,745 46,864,545 5,359,890 5,359,890 44,665,752 4,867,347 4,867,347 40,561,224 5,019,827 5,019,827 41,831,893 37,120,729 4,454,487 4,454,487 38,887,451 4,666,494 4,666,494 33,663,879 4,039,665 4,039,665 35,340,214 4,240,826 4,240,826 30,787,185 3,694,462 3,694,462 32,392,741 3,887,129 3,887,129 (In Thousands) LEGAL DEBT MARGIN CITY OF HUNTINGTON BEACH LAST TEN FISCAL YEARS Assessed Valuation Debt Limit - 12% of Assessed Valuation Debt Applicable to Limit Legal Debt MarginFiscal Year 171 343 2023-24 Assessed Valuation: $51,179,643,299 Debt Repaid with Property Taxes (Tax and Assessment Debt): Overlapping Tax and Assessment Debt Percent Applicable* Debt Applicable to City Metropolitan Water District 1.320% 240,372 Coast Community College District 27.865% 247,150,313 Los Alamitos Unified School District Facilities Improvement District No. 1 1.121% 2,417,663 Huntington Beach Union High School District 72.664% 99,789,470 Fountain Valley School District 26.687% 15,174,228 Huntington Beach School District 99.946% 150,297,757 Ocean View School District 93.632% 141,286,006 Westminster School District 23.935% 37,223,341 City of Huntington Beach Community Facilities Districts (2000-1, 2002-1, 2003-1) 100.000% 22,990,000 Total Overlapping Tax and Assessment Debt 716,569,150$ Direct and Overlapping General Fund Debt Orange County General Fund Obligations 6.647% 29,272,391 Orange County Board of Education General Fund Obligations 6.647% 666,694 North Orange County Regional Occupation Program Certificates of Participation 0.082% 6,027 Coast Community College District General Fund Obligations 27.865% 299,549 Coast Community College District Pension Obligation Bonds 27.865% 257,751 Huntington Beach Union High School District Certificates of Participation 72.664% 37,375,520 Los Alamitos Unified School District Certificates of Participation 1.007% 306,458 Huntington Beach School District General Fund Obligations 99.946% 13,476,577 Ocean View School District Certificates of Participation 93.632% 11,914,672 Westminster School District General Fund Obligations 23.935% 5,858,091 City of Huntington Beach General Fund Obligations 100.000% 43,805,882 City of Huntington Beach Pension Obligation Bonds 100.000% 324,910,000 Total Direct and Overlapping General Fund Obligation Debt 468,149,612$ Overlapping Tax Increment Debt (Successor Agency) 100.000% 1,140,000 Total Direct Debt 368,715,882$ Total Overlapping Debt 817,142,880 Combined Total Debt 1,185,858,762$ (1) Percentage of overlapping agency's assessed valuation located within boundaries of the City. (1) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue, and non-bonded leases obligations. Ratios to Adjusted Assessed Valuations Combined Direct Debt ($364,676,282) 0.72% Combined Total Debt 2.32% Ratios to Redevelopment Successor Agency Incremental Valuation ($4,102,592,346) Total Overlapping Tax Increment Debt 0.03% Source: California Municipal Statistics and City of Huntington Beach Finance Department STATEMENT OF DIRECT AND OVERLAPPING BONDED DEBT JUNE 30, 2024 CITY OF HUNTINGTON BEACH * The percentage of overlapping debt applicable to the city is estimated using taxable assessed property value. Applicable percentages were estimated by determining the portion of the overlapping district's assessed value that is within the boundaries of the city divided by the district's total taxable assessed value. 172 344 2024 % of total The Boeing Company 3,112 3.06% Cambro Manufacturing 650 0.64% Hyatt Regency Huntington Beach 641 0.63% Huntington Beach Hospital 527 0.52% Wal-Mart 462 0.45% No Ordinary Moments 458 0.45% Waterfront Hilton Beach Resort 450 0.44% Home Depot USA Inc 436 0.43% Home and Body Company 418 0.41% Target Corporation 351 0.35% Total of top 10 7,505 7.38% All others 94,195 92.62% Total employment (public and private)101,700 100.00% 2015 % of total Boeing 4,857 4.67% Cambro MFG Co.951 0.91% Ensign United States Drilling 925 0.89% Hyatt Regency Huntington Beach 641 0.62% C & D Aerospace 555 0.53% Zodiac Aerospace / Driessen Aircraft 542 0.52% Huntington Beach Hospital 527 0.51% Quiksilver 525 0.50% Walters Wholesale Electronics 480 0.46% Rainbow Disposal 408 0.39% Total of top 10 10,411 10.00% All others 93,589 90.00% Total employment (public and private)104,000 100.00% Source: Finance Department, City of Huntington Beach CITY OF HUNTINGTON BEACH PRINCIPAL PRIVATE EMPLOYERS CURRENT YEAR AND NINE YEARS AGO 173 345 General Government:2024 2023 2022 2021 2020 2019 2018*** 2017 2016 2015 City Council 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 City Manager 16.00 14.00 27.00 20.00 18.00 12.50 12.50 11.50 11.50 11.50 City Treasurer 9.50 9.50 9.50 1.50 1.50 2.00 2.00 2.00 1.50 1.50 City Attorney 15.00 11.00 11.00 11.00 11.00 11.00 11.00 12.00 11.00 11.00 City Clerk 6.00 5.00 5.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 Finance 28.50 28.50 28.50 32.50 31.50 33.00 33.00 33.00 32.50 31.50 Human Resources **15.00 13.00 - - - 15.00 15.00 15.00 15.00 15.00 Community Development 61.50 57.50 57.50 57.50 54.00 44.00 44.00 44.00 43.50 44.00 Information Systems 26.00 25.00 25.00 26.00 22.00 30.00 30.00 30.00 30.00 30.00 Library Services 29.25 29.25 29.25 29.25 23.25 28.25 28.25 28.25 28.25 28.25 Fire 202.00 201.00 201.00 201.00 200.00 198.00 198.00 198.00 198.00 198.00 Police 351.00 353.00 353.00 357.00 356.00 365.50 364.50 364.50 364.50 361.50 Community Services 33.00 33.00 33.00 33.00 37.00 36.00 36.00 44.00 44.00 43.00 Public Works 212.00 211.00 211.00 207.00 199.00 207.00 207.00 199.00 199.00 198.00 1,005.75 991.75 991.75 980.75 958.25 987.25 986.25 986.25 983.75 978.25 Source: Finance Department, City of Huntington Beach * Economic Development was combined with Community Development in the year ended June 30, 2020. Previously, it was combined with the City Manager's Office as of the year ended September 30, 2014. ** Human Resources was combined with City Manager's Office in the year ended June 30, 2020. Human Resources was seperated in Fiscal Year ended June 30, 2024. *** The 2017-18 period reflects nine months of activity only as the fiscal year change resulted in a nine month reporting period from October 1, 2017 to June 30, 2018. Actual CITY OF HUNTINGTON BEACH FULL-TIME ACTUAL AND BUDGETED CITY EMPLOYEES BY FUNCTION/PROGRAM LAST TEN FISCAL YEARS 174 346 Function/Program 2024 2023 2022 2021 2020 Finance: Water Bills Processed 639,300 638,052 637,956 637,920 636,708 Active Business Licenses 18,851 18,787 18,849 19,011 20,910 Accounts Receivable Billings Processed 10,813 10,649 12,437 20,183 25,687 City Clerk: Passports Issued ****4,570 6,455 5,721 418 4,579 Planning: Entitlements Processed 131 143 154 112 162 Plan Reviews 398 442 606 1,955 1,358 Field Inspection Complaints 12,108 15,247 7,403 11,899 11,610 Code Violation Cases 3,957 5,599 5,051 4,473 3,260 Building: Number of Permits Issued 11,464 11,536 10,292 9,075 8,855 Number of Inspections Completed 44,613 33,983 31,080 26,710 32,859 Value of Construction Permits (Thousands of Dollars)272,596 369,060 237,945 166,000 169,393 Processed Number of Certificate of Occupancies*592 521 641 655 515 Completed Plan Reviews 4,812 6,916 5,701 4,673 3,469 Counter Visits 3,318 6,264 14,289 115 14,922 Fire: Inspections 7,209 7,557 7,311 4,008 5,965 Responses 22,016 21,936 22,076 20,428 21,068 Ocean Rescues 3,554 3,027 4,160 4,116 2,487 Estimated Beach Visitors 8,984,500 9,101,188 8,345,139 7,910,293 6,712,125 Police: Physical Arrests 5,507 5,358 5,585 5,363 5,785 Parking Violations 75,355 75,408 97,299 95,753 59,484 Traffic Violations 5,221 6,544 8,869 10,920 12,105 Community Services: Park/Open Space Acreage 1,072 1,072 1,072 1,072 1,066 Enrollment in Recreation Classes 33,312 35,192 34,616 15,511 28,952 Public Works: Water Sold (Acre Feet)**23,153 23,358 26,459 27,731 25,966 Gallons of Sewage Pumped Per Day**17 million 17 million 19 million 19 million 19 million Library: Items in Collection 280,595 289,299 290,351 291,444 294,849 Items Borrowed 846,059 811,837 796,882 481,523 779,124 * Beginning the 2013/14 Fiscal Year, the Building Department no longer processes Certificate of Occupancies. ** Reduction of estimate is the result of the Governor's executive order to reduce water consumption. *** The 2017-18 period reflects nine months of activity only as the fiscal year change resulted in a nine month reporting period from October 1, 2017 to June 30, 2018. **** Passport acceptance was closed to the public from June 2020 through May 2021 due to COVID-19. It was reopened on June 15, 2021. Source: Various departments of the City of Huntington Beach CITY OF HUNTINGTON BEACH OPERATING INDICATORS BY FUNCTION/ACTIVITY LAST TEN FISCAL YEARS 175 347 Function/Program 2019 2018*** 2017 2016 2015 Finance: Water Bills Processed 639,245 476,290 632,997 635,052 536,684 Active Business Licenses 21,414 21,782 22,074 21,420 21,424 Accounts Receivable Billings Processed 30,217 25,000 34,963 30,826 38,594 City Clerk: Passports Issued 7,024 5,757 7,408 5,623 5,121 Planning: Entitlements Processed 221 206 216 221 280 Plan Reviews 1,542 1,466 1,376 1,653 1,595 Field Inspection Complaints 8,183 7,005 8,459 7,951 8,233 Code Violation Cases 4,786 4,219 3,981 4,324 4,710 Building: Number of Permits Issued 9,807 7,490 9,728 10,981 10,670 Number of Inspections Completed 36,562 30,501 38,796 39,380 38,320 Value of Construction Permits (Thousands of Dollars)135,910 109,462 216,252 283,910 234,946 Processed Number of Certificate of Occupancies*686 523 740 n/a n/a Completed Plan Reviews 3,491 2,771 4,172 4,172 3,815 Counter Visits 21,409 16,498 21,731 23,492 21,893 Fire: Inspections 6,140 3,963 2,758 5,132 6,499 Responses 20,354 14,490 20,555 20,279 19,562 Ocean Rescues 4,953 3,530 3,639 3,977 5,371 Estimated Beach Visitors 10,577,290 12,522,640 13,339,518 12,272,030 11,803,943 Police: Physical Arrests 5,979 4,614 5,298 5,112 4,854 Parking Violations 79,069 54,500 70,846 90,361 83,453 Traffic Violations 13,314 11,869 19,916 17,639 17,596 Community Services: Park/Open Space Acreage 1,066 1,065 1,065 1,062 1,062 Enrollment in Recreation Classes 37,978 27,152 37,968 34,424 30,228 Public Works: Water Sold (Acre Feet)**26,251 19,777 25,944 24,505 24,763 Gallons of Sewage Pumped Per Day**19 million 19 million 22 million 19 million 19 million Library: Items in Collection 293,995 292,037 288,599 285,814 343,655 Items Borrowed 942,821 655,626 943,642 921,105 908,656 CITY OF HUNTINGTON BEACH OPERATING INDICATORS BY FUNCTION/ACTIVITY LAST TEN FISCAL YEARS (Continued) 176 348 Library Services One Main Library and Four Branches Fire: Fire Stations 8 Police: Stations One Main Station and Three Substations Community Services: Acreage of Parks 1,072 Community Centers 6 Public Works: Centerline Square Miles of Streets Maintained 451 Miles of Beach Maintained 4.7 Miles of Storm Drains Maintained 120 Miles of Sewer Maintained 362 Source: Various departments of the City of Huntington Beach JUNE 30, 2024 CAPITAL ASSET STATISTICS BY FUNCTION/ACTIVITY CITY OF HUNTINGTON BEACH 177 349 Honorable Mayor and City Council City of Huntington Beach Huntington Beach, California We have audited the financial statements of the governmental activities, the business- type activities, and the aggregate remaining fund information of the City of Huntington Beach (the “City”) as of and for the year ended June 30, 2024, and have issued our report thereon dated December 21, 2024. Professional standards require that we advise you of the following matters relating to our audit. Our Responsibility in Relation to the Financial Statement Audit As communicated in our engagement letter, our responsibility, as described by professional standards, is to form and express an opinion about whether the financial statements that have been prepared by management with your oversight are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America. Our audit of the financial statements does not relieve you or management of your respective responsibilities. Our responsibility, as prescribed by professional standards, is to plan and perform our audit to obtain reasonable, rather than absolute, assurance about whether the financial statements are free of material misstatement. An audit of financial statements includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, as part of our audit, we considered the internal control of the City solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control. We are also responsible for communicating significant matters related to the audit that are, in our professional judgment, relevant to your responsibilities in overseeing the financial reporting process. However, we are not required to design procedures for the purpose of identifying other matters to communicate to you. Planned Scope and Timing of the Audit We conducted our audit consistent with the planned scope and timing we previously communicated to you. Compliance with All Ethics Requirements Regarding Independence The engagement team, others in our firm, and our firm, have complied with all relevant ethical requirements regarding independence under the American Institute of Certified Public Accountants (“AICPA”) independence standards, contained in the Code of Professional Conduct. 350 + Davis Farr CERTIFIED PUBLIC ACCOUNTANTS Davis Farr LLP 18201 Von Karman Avenue I Suite 1100 I Irvine, CA 92612 Main: 949.474 .2020 I Fax : 949.263.5520 Significant Risks Identified We have identified the following significant risks: Compliance with Federal grant requirements Collectability of Receivables and Allowance for Doubtful Accounts Qualitative Aspects of the Entity’s Significant Accounting Practices Significant Accounting Policies Management has the responsibility to select and use appropriate accounting policies. A summary of the significant accounting policies adopted by the City is included in Note 1 to the financial statements. There have been no initial selection of accounting policies and no changes in significant accounting policies or their application during 2024. No matters have come to our attention that would require us, under professional standards, to inform you about (1) the methods used to account for significant unusual transactions and (2) the effect of significant accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus. Significant Accounting Estimates Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s current judgments. Those judgments are normally based on knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ markedly from management’s current judgments. The most sensitive accounting estimates affecting the financial statements are: Judgments as to which City capital projects should be capitalized and depreciated in the government-wide financial statements and proprietary funds. We evaluated management’s judgments for reasonableness. Judgments relating to the collectability of accounts and notes receivable. We evaluated management’s judgments for reasonableness. Judgments with respect to recording claims payable. We evaluated management’s judgments for reasonableness. Judgments involving calculation of the pension liability. We evaluated the actuarial valuation report supporting the calculations. Judgments involving the calculation of the other post-employment benefit (OPEB) liability. We evaluated the actuarial valuation report supporting the calculations. We evaluated the key factors and assumptions used to develop the estimates and determined that it is reasonable in relation to the financial statements taken as a whole and in relation to the applicable opinion units. 351 Financial Statement Disclosures Certain financial statement disclosures involve significant judgment and are particularly sensitive because of their significance to financial statement users. The most sensitive disclosures affecting the City’s financial statements were: The disclosure of pensions in note 6 to the financial statements. The disclosure of OPEB in note 8 to the financial statements. The financial statement disclosures are neutral, consistent, and clear. Significant Difficulties Encountered during the Audit We encountered no difficulties in dealing with management relating to the performance of the audit. Uncorrected and Corrected Misstatements For purposes of this communication, professional standards also require us to accumulate all known and likely misstatements identified during the audit, other than those that we believe are trivial, and communicate them to the appropriate level of management. Further, professional standards require us to also communicate the effect of uncorrected misstatements related to prior periods on the relevant classes of transactions, account balances or disclosures, and the financial statements as a whole and each applicable opinion. Uncorrected misstatements or matters underlying those uncorrected misstatements could potentially cause future-period financial statements to be materially misstated, even though the uncorrected misstatements are immaterial to the financial statements currently under audit. Management has corrected all identified misstatements. In addition, professional standards require us to communicate to you all material, corrected misstatements that were brought to the attention of management as a result of our audit procedures. There was one material misstatement to correct accounts receivable and unavailable revenue in the Grants Special Revenue fund. Disagreements with Management For purposes of this letter, professional standards define a disagreement with management as a matter, whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter, which could be significant to the City’s financial statements or the auditor’s report. No such disagreements arose during the course of the audit. Representations Requested from Management We have requested certain written representations from management, which are included in the attached letter dated December 21, 2024. 352 Management’s Consultations with Other Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters. Management informed us that, and to our knowledge, there were no consultations with other accountants regarding auditing and accounting matters. Other Significant Matters, Findings, or Issues In the normal course of our professional association with the City, we generally discuss a variety of matters, including the application of accounting principles and auditing standards, significant events or transactions that occurred during the year, operating and regulatory conditions affecting the entity, and operational plans and strategies that may affect the risks of material misstatement. None of the matters discussed resulted in a condition to our retention as the City’s auditors. Other Information Included in Annual Comprehensive Financial Report Pursuant to professional standards, our responsibility as auditors for other information, whether financial or nonfinancial, included in the City’s annual reports, does not extend beyond the information identified in the audit report, and we are not required to perform any procedures to corroborate such other information. However, in accordance with such standards, we have read the information and considered whether such information, or the manner of its presentation, was materially inconsistent with its presentation in the financial statements. Our responsibility also includes communicating to you any information which we believe is a material misstatement of fact. Nothing came to our attention that caused us to believe that such information, or its manner of presentation, is materially inconsistent with the information, or manner of its presentation, appearing in the financial statements. This report is intended solely for the information and use of the City Council and management of the City and is not intended to be and should not be used by anyone other than these specified parties. Irvine, California December 21, 2024 353 Independent Auditor’s Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Air Quality Special Revenue Fund Performed in Accordance with Government Auditing Standards City Council City of Huntington Beach Huntington Beach, California We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the Air Quality Special Revenue Fund of the City of Huntington Beach, California, as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the Air Quality Special Revenue Fund of the City of Huntington Beach’s basic financial statements, and have issued our report thereon dated December 23, 2024. Report on Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered the Air Quality Special Revenue Fund's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Air Quality Special Revenue Fund's internal control. Accordingly, we do not express an opinion on the effectiveness of the Air Quality Special Revenue Fund's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that have not been identified. 354 + Davis Farr CERTIFIED PUBLIC ACCOUNTANTS Davis Farr LLP 18201 Von Karman Avenue I Suite 1100 I Irvine, CA 92612 Main: 949.474 .2020 I Fax: 949.263.5520 Report on Compliance and Other Matters As part of obtaining reasonable assurance about whether the Air Quality Special Revenue Fund's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, including applicable provisions of Assembly Bill 2766 (AB2766) Chapter 1705 (Health and Safety Code Sections 44220 through 44247), noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Irvine, California December 23, 2024 355 INDEPENDENT ACCOUNTANT’S REPORT The Honorable Mayor and City Council City of Huntington Beach, California We have performed the procedures enumerated below on the City of Huntington Beach, California (City) appropriations limit worksheets for compliance with the requirements of Section 1.5 of Article XIIIB of the California Constitution for the year ended June 30, 2024. The City is responsible for compliance with Section 1.5 of Article XIIIB of the California Constitution. The City has agreed to and acknowledged that these procedures are appropriate to meet the intended purpose of evaluating compliance with the requirements of Section 1.5 of Article XIIIB of the California Constitution and the League of California Cities publication entitled Article XIIIB Appropriations Limitation Uniform Guidelines for the year ended June 30, 2024. This report may not be suitable for any other purpose. The procedures performed may not address all the items of interest to a user of this report and may not meet the needs of all users of this report and, as such, users are responsible for determining whether the procedures performed are appropriate for their purposes. The procedures and the associated findings are as follows: 1. We obtained the worksheets referred to above and compared the limit and annual adjustment factors included in those worksheets to the limit and annual adjustment factors that were adopted by resolution of the City Council. We also compared the population and inflation options included in the aforementioned worksheets to those that were selected by a recorded vote. Results: No exceptions were noted as a result of our procedures. 2. We recalculated the mathematical computations reflected in the City’s worksheets. Results: No exceptions were noted as a result of our procedures. 3. We compared the current year information used to determine the current year limit and agreed it to worksheets prepared by the City and to information provided by the State Department of Finance. Results: No exceptions were noted as a result of our procedures. 4. We compared the amount of the prior year appropriations limit presented in the worksheets to the amount adopted by the City Council for the prior year. Results: No exceptions were noted as a result of our procedures. 356 Davis Farr CERTIFIED PUBLIC ACCOUNTANTS Davis Farr LLP 18201 Von Karman Avenue I Suite 1100 I Irvine, CA 92612 Main: 949.474.2020 I Fax: 949.263.5520 The Honorable Mayor and City Council City of Huntington Beach, California Page Two We were engaged by the City to perform this agreed-upon procedures engagement and conducted our engagement in accordance with standards established by the American Institute of Certified Public Accountants. We were not engaged to and did not conduct an examination or review, the objective of which would be the expression of an opinion or conclusion, respectively on the worksheets referred to above. Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. No procedures have been performed with respect to the determination of the appropriation limit for the base year, as defined by the League publication entitled Article XIIIB Appropriations Limitation Uniform Guidelines. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements related to our agreed-upon procedures engagement. This report is intended solely for the information and use of the Management of the City of Huntington Beach, California and is not intended to be, and should not be, used by anyone other than the specified party. Irvine, California December 23, 2024 357 APPROPRIATION AND TRANSFER INCREASE: Dept From Name Amount To Fund Name City Manager 243 PEG Fund 611,888.68 314 Infrastructure Fund City Manager 243 PEG Fund 151,615.53 324 Equipment Replacement Fund Community Development 410 Debt Service Bella Terra 184,000.00 711 Parking Structure - Bella Terra TOTAL 947,504.21 APPROPRIATION INCREASE: Dept Fund Name Amount Non-Departmental 709 Hotel/Motel BID Fund 46,673.00 Non-Departmental 710 Downtown BID Fund 9,011.00 Non-Departmental 711 Bella Terra Parking Structure Fund 184,000.00 Public Works 960 Used Oil Grant Fund 12,453.39 TOTAL 252,137.39 Fiscal Year 2023/24 Interfund Transfers ATTACHMENT 3 Fiscal Year 2023/24 Appropriation Increases 358 FY 2023/24 Annual Comprehensive Financial Report (ACFR) & Year-End Budget Adjustments City Council Meeting January 21, 2025 1359 Presentation Overview •FY 2023/24 Year-End Audit and Annual Comprehensive Financial Report (ACFR) •Presentation given by Auditor Jonathan Foster CPA, Partner – DavisFarr •FY 2023/24 Year-End Budget Adjustment Requests 2360 City FY 2023/24 Year-End Audit and Annual Comprehensive Financial Report (ACFR) 3361 Reports Issued •Audited Opinion •Unmodified •Communication to those in Governance •Internal Control Letter – issued in conjunction with Single Audit Report •One material audit adjustment noted •In progress •Single Audit over Federal Expenditures 4362 Areas of Audit Focus Pension Obligations OPEB Obligations Revenue and Expenditure testing Testing of Capital Asset Activities Single Audit 363 Pension Obligations Tes ·ng of Cap· al Asse Ac iv· ies FY 2023/24 Performance (Audited) Description In Thousands ASSETS Current and Other Assets $523,525 Non-Current Assets 5,207 Capital Assets 932,745 Total Assets 1,461,477 Deferred Outflows – Pensions & OPEB 135,090 LIABILITIES Current and Other Liabilities 75,969 Long-Term Obligations*604,946 Total Liabilities 680,915 Deferred Inflows – Pension & OPEB 18,868 TOTAL NET POSITION $896,784 Government-Wide Highlights: * Reflects GASB 68 recording of Net Pension Liability of $193,451 million 364 General Fund Reserves (Audited) * Other Fund Balance includes Encumbrances, Non-Spendable, and Restricted Items. Fund Balance Category FY 19/20 Audited FY 20/21 Audited FY 21/22 Audited FY 22/23 Audited FY 23/24 Audited Economic Uncertainties 25,010 25,381 26,114 48,411 49,090 Equipment Replacement 8,295 8,295 8,295 8,295 8,295 General Plan Maintenance 791 791 1,143 1,515 1,651 General Liability Plan Migration 2,801 2,801 2,801 2,801 2,801 Capital Improvement Reserve (CIR) 8,046 8,230 8,597 9,086 9,425 Pension Rate Stabilization 741 2,206 4,160 5,517 Cityview Replacement 1,028 1,028 1,028 Strategic Initiatives 16,536 16,536 16,536 Section 115 Trust 10,003 12,878 15,927 20,641 24,423 Triple Flip 896 749 109 Year-End Market Value 1,983 1,983 1,983 3,025 Housing Agreement 101 174 1,657 Litigation Reserves 3,650 3,650 3,650 3,650 AES Reserves 4,900 4,900 4,900 HB Recovery Fund 10,886 10,886 Oceanview Estates 365 641 Other Fund Balance* 4,598 6,472 7,878 11,827 12,915 Unassigned Total Fund Balance 80,088 94,609 102,824 126,537 132,319 365 FY 2023/24 General Fund (Audited) (Fund 100) Description In Thousands Revenue (Recurring)$290,289 Revenue (One-Time) *2,276 Planned Use of Reserves 4,900 Total Sources of Funds $297,465 Expenditures less UAL 266,694 CalPERS UAL 4,643 POB Payment 13,255 One-Time Expenditures**6,038 Total Expenditures $290,630 Other Restricted Changes in General Fund Balance***4,119 General Fund (Fund 100) Surplus $2,716 * FY 23/24 one-time revenue consists of $2.3M for Emerald Cove Superior Court Judgment ** Includes $4.9M for AES Transfer and $1.1M Transfer of 50% of Emerald Cove settlement to the General Liability Fund *** Includes adjustments to YE Market Value and set-asides for Ocean View Estates and General Plan Maintenance 366 General Fund Surplus Allocation Description Amount FY 2023/24 General Fund (Fund 100) Surplus $2,715,730 Pension Rate Stabilization 1,357,865 Economic Uncertainties 678,932 Capital Improvement Reserve 339,466 Infrastructure Fund Transfer 339,466 Total Allocated Surplus per Fund Balance Policy $2,715,730 General Fund Reserve Policy requires the following: •50% to Pension Rate Stabilization Reserve (per Unfunded Accrued Liability Pension Funding Policy) Remaining surplus allocated as follows (until Economic Uncertainties is fully funded): •50% to Economic Uncertainties Reserve •25% to Capital Improvement Reserve •25% for Infrastructure Fund 367 FY 2023/24 Year-End Budget Adjustments 10368 FY 2023/24 Year-End Budget Adjustments •As part of the FY 2023/24 year-end closing process, certain technical year-end budget adjustments are requested to align appropriations in certain funds with actual expenditures incurred through June 30, 2024 •Adjustments are also required to ensure compliance with Generally Accepted Accounting Principles (GAAP), Governmental Accounting Standards Board (GASB), and other regulatory, contractual or legal requirements. •All requested appropriation increases are fully offset by commensurate amounts of revenues, available cash, or fund balances in each Fund •No General Fund adjustments are being requested 11369 Inter-Fund Transfers 12 Surf City “3” Cable Channel, Infrastructure, and Equipment Replacement Funds (243, 314 and 324) •$612K – transfer from the City “3” Cable Channel Fund (243) into the Infrastructure Fund (314) in the amount of $611,888.68 to reimburse the Infrastructure Fund for its fair share of various fiber upgrades that benefitted the City’s Cable Channel •$152K – transfer from the Surf City “3” Cable Channel Fund (243) into the Equipment Replacement Fund (324) in the amount of $151,615.53 to reimburse the Equipment Replacement Fund for its fair share of server and other equipment upgrades that benefitted the City’s Cable Channel Debt Service Bella Terra and Bella Terra Parking Structure Funds (410 and 711) •$184K – transfer from the Debt Service Bella Terra Fund (410) into the Bella Terra Parking Structure Fund (711) to cover increased maintenance and operations costs that are paid for from the Bella Terra Parking Structure Fund (711). •A corresponding expenditure appropriation is being requested in the Bella Terra Parking Structure Fund (711) to cover the increased maintenance costs Total Inter-Fund Transfer Adjustments - $947,504.21 370 Appropriation Increases 13 Hotel/Motel Business Improvement District (Hotel/Motel BID) Fund (709) •$46,673 to align the budget with actual FY 2023/24 revenues and expenditures. The Hotel/Motel BID Fund is a pass-thru fund in which the City collects self- assessed revenues from the participating hotels and motels and submits them to Visit Huntington Beach per the BID’s agreement. There are sufficient offsetting revenues for a net zero impact. Downtown Business Improvement District (Downtown BID) Fund (710) •$9,011 to align the budget with actual FY 2023/24 revenues and expenditures. All Downtown merchants have a self-assessment through the Business Improvement District (BID) that the City Council approves annually. The City collects the fees and redistributes them back to the District. There are sufficient offsetting revenues for a net zero impact. 371 Appropriation Increases 14 Bella Terra Parking Structure Fund (711) •$184,000 to align the align the budget with actual FY 2023/24 revenues and expenditures. The City collects a maintenance fee from the owners of the center which is used to fund maintenance and operations costs for the structure. There are sufficient offsetting revenues for a net zero impact. Used Oil Grant Fund (960) •$12,453.39 to align the budget with actual FY 2023/24 revenues and expenditures. A portion of prior year grant funds from the OPP13 term were unspent and needed to be returned to the Department of Resources Recycling and Recovery (CalRecycle). There are sufficient offsetting grant revenues for a net zero impact. Total Appropriation Increases - $252,137.39 372 Council Action Requested •Receive and file the FY 2023/24 Annual Comprehensive Financial Report and other auditor-issued reports •Approve year-end inter-fund transfers in the amount of $947,504.21 •Approve year-end appropriation increases in the amount of $252,137.39 •The General Fund is not impacted by these year-end adjustment requests 15373 Questions? 374 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:24-933 MEETING DATE:1/21/2025 REQUEST FOR CITY COUNCIL ACTION SUBMITTED TO:Honorable Mayor and City Council Members SUBMITTED BY:Travis Hopkins, Acting City Manager VIA:Chau Vu, Director of Public Works PREPARED BY:Lili Hernandez, Principal Civil Engineer Subject: Approve and accept the California State Water Resources Control Board (SWRCB) grant for the Old Pirate Lane State Small Water System Consolidation Project, CC-1624, and approve appropriation of funds Statement of Issue: On July 11, 2024, California State Water Resources Control Board (SWRCB) awarded the City of Huntington Beach $327,947 in Expedited Drinking Water Grant (EDWG) funding for the construction of Old Pirate Lane State Small Water System Consolidation Project, CC-1624. City Council action is requested to accept the grant agreement and approve appropriations to complete the project. Financial Impact: The total estimated cost of the project is $578,000. The State Water Resources Control Board has granted the city $327,947 from the State Water System Consolidation Project grant program. Staff requests an appropriation of $250,053 from the Water Fund (506) into the Old Pirate Lane business unit 50691049 to cover the remainder of the project expenses. Recommended Action: A) Approve and authorize the Public Works Director to accept the State Water Resources Control Board (SWRCB) grant for $327,947; and, B) Approve appropriation of grant award funding of $327,947 into the SWRCB Old Pirate Lane business unit 130291001.82100; and, C) Approve appropriation of $250,053 into business unit 50691049.82100. Alternative Action(s): Do not approve the recommended action and direct staff accordingly. Analysis: City of Huntington Beach Printed on 1/16/2025Page 1 of 3 powered by Legistar™ 375 File #:24-933 MEETING DATE:1/21/2025 The Old Pirate Lane State Small Water System Consolidation Project addresses a critical public health concern identified by the Orange County Health Care Agency (OCHCA) in January 2020. Elevated nitrate levels in a privately operated well (Old Pirate Lane Water Company (OPLWC), which serves 13 residences, exceeded regulatory agency standards. This prompted the City to provide a temporary water connection and pursue State funding for a permanent solution. The project costs involve staff performing the majority of the work, including design, material procurement, permit acquisition, and construction. This project will provide a permanent solution by: 1. Constructing 260 linear feet of 8-inch potable water pipeline. 2. Extending the waterline to Doverton Drive for redundancy and improved water quality. 3. Installing individual service lines and meters for each property to meet City standards. 4. Properly abandoning the private well per OCHCA regulations. 5. Recording easements to ensure public ownership of the new system. In March 2021, the City Council adopted Resolution No. 2021-16, authorizing the application for grant funding to address unsafe water quality conditions for the Old Pirate Drive community. The City has since pursued all feasible funding options, resulting in the award of $327,947 Expedited Drinking Water Grant (EDWG) funding in July 2024. The Expedited Drinking Water Grant (EDWG) program, administered by the California State Water Resources Control Board (SWRCB), provides essential funding to address critical drinking water infrastructure needs across California. The program prioritizes projects that benefit disadvantaged and high-priority small communities, ensuring access to safe, clean, and affordable drinking water. By targeting contamination issues, facilitating the construction and repair of water systems, and supporting the consolidation of smaller systems for long-term sustainability, the EDWG program plays a vital role in mitigating public health risks. By expediting financial assistance, the program significantly reduces the financial burden on local agencies while advancing California’s strategic goals for water quality and infrastructure investment. This grant offsets a significant portion of the project cost, but an additional $250,053 is required to cover construction contingencies and professional services. Approval of this action will ensure the project is completed successfully, safeguarding public health and compliance with City and State standards. Environmental Status: This action is covered by the General Rule that the California Environmental Quality Act (CEQA) applies only to projects that have the potential for causing a significant effect on the environment (Section 15061.b.3 of the State CEQA Guidelines). It can be seen with certainty that there is no possibility that this activity will have a significant effect on the environment. Therefore, this activity is not subject to CEQA. Strategic Plan Goal: Goal 6 - Infrastructure Investment, Strategy C - Conduct an assessment of all City facilities to determine priorities for upgrades and repairs, implementation and financial priority. City of Huntington Beach Printed on 1/16/2025Page 2 of 3 powered by Legistar™ 376 File #:24-933 MEETING DATE:1/21/2025 Attachment(s): 1. EDWG Agreement 2. Resolution No. 2021-16 3. Project Vicinity Map 4. PowerPoint Presentation City of Huntington Beach Printed on 1/16/2025Page 3 of 3 powered by Legistar™ 377 378 ,,P CA Lt PO JI NI • Water Boards State Wate r Res ource s C ont rol Bo a rd May 31 , 2024 City of Huntington Beach Attn: Chau Vu , Director of Public Works 2000 Main Street Huntington Beach, CA 92648 Agreement Number: D2302094 Project Number: EDWG-3010053-001 C ~ GAVll4 N EWSOM ~ C.OVtHIIOH N•~ YA NA G ARCI A l "'-..~ S ECA ET/,.RV FO R ~ EU YIAOUM EUTA.l PROTEC TI ON Please review, and if appropriate, electronically sign the signature page of the Agreement via Adobe Sign no later than fifteen (15) calendar days from the date of this letter. Once electronically signed, the Agreement will be routed automatically to the next signer. You will automatically receive a copy of the fully executed Agreement via Adobe Sign once the final signer has signed. This Agreement cannot be considered binding by either party until executed by the State Water Resources Control Board (State Water Board). For the Funding Agreement to be executed by the State Water Board , the following items must also be returned electronically with the signed signature pages: The Opfnion will need to be dated and signed on or after the date the agreement is signed. Counsel can file and attach the letters and submit them back to Adobe. 1. Opinion of General Counsel . If you have questions about the General Counsel Opinion Letter, please contact Lida Hadi at (916) 341- 5799 or email at Lida .Hadi@waterboards.ca .gov. Please note that all projects receiving funding must comply w ith all applicable implement ing guidelines and regulations adopted by the California Department of Industrial Relations (DIR), regarding state prevailing wage requirements. You must contact DIR for guidance on how to comply. Information can be found at: http://www.dir.ca.gov/lcp .asp . Ms. Lida Hadi may be contacted at (916) 341-5799 or email at Lida .Hadi@waterboards.ca .gov. Enclosures E . J OAQU IN ESQU IVEL , CHAI R I ERIC OPP ENH EI ME R , EXEC UTIVE DIRECTOR 1001 I Street, Sac rame nto, CA 95814 I Mailing Addre:is: P.O. Box 100, Sacramento, CA 95812-0100 I www.waterboard~.ca.gov Adobe Acroba t Sign Tr ansactio n Numb er. CBJ CHBCMBAAL8x29 bFQS EpfcAXck9mLLIN_HVNc7vY3 379 ,,,, CALI F ORNIA Water Bo ards t1•fl <1 •••• •tlll',r •lott c,0 .. 1 •0 , ·•••• •••10 14 1 ••••• •••u" ro ,,,oL ,0.,111 EXPEDITED DRINKING WATER GRANT AGREEMENT NO . D2302094 BY AND BETWEEN CITY OF HUNTINGTON BEACH ("Recipient") AND CALIFORNIA STATE WATER RESOURCES CONTROL BOARD ("State Water Boa rd") FORTHEPURPOSEOFTHE OLD PIRATE LANE CONSOLIDATION PROJECT ("Project") PROJECT NO . EDWG -3010053-001C • Senate Bill 129 (Stats. 2021 , Ch . 69), Item 3940-106-000 1 of Sect ion 2.00 of the Budget Act of 2021 , Provis ion 1 and Resolution Nos . 2023-0006 and 2023-0021 . PROJECT FUNDING AMOUNT: $327,947 ESTIMATED REASONABLE PROJECT COST: $327,947 ELIGIBLE WORK START DATE: JULY 12, 2021 ESTIMATED COMPLETION OF CONSTRUCTION DATE: FEBRUARY 1, 2026 PROJECT COMPLETION DATE: FEBRUARY 1, 2026 FINAL REIMBURSEMENT REQUEST DATE : MARCH 1, 2026 RECORDS RETENTION END DATE : FEBRUARY 1, 2062 Adobe Acrobat Sign Transaction Number: CBJCHBCM8Ml8x29bFQSEpfcAXck9mllill_HVNc7vY.3 380 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 1 of 37 1. The State Water Board and the Recipient mutually promise , covenant, and agree to the terms, provisions, and conditions of this Agreement, including the following Exhibits, which are attached hereto or are incorporated by reference : • EXHIBIT A -SCOPE OF WORK AND SCHEDULE • EXHIBIT B -FUNDING PROVISIONS • EXHIBIT C -GENERAL TERMS AND CONDITIONS • EXHIBIT D -SPECIAL CONDITIONS 2. The following documents are also incorporated by reference , as well as any documents incorporated by reff;}rence in Exhibit D: • the Final Plans & Specifications , including any amendments, as approved by the Division, which are the bas is for the construction contract to be awarded by the Recipient; • the Drinking Water System Permit No. 05-08-15P-006, and any amendments thereto; 3. Party Contacts during the term of this Agreement are: State Water Board City of Huntington Beach Section: Division of Financial Assistance Name: Pete Stamas, Name: Chau Vu , Proiect ManaQer Director of Public Works Address : 1001 I Street, 16th Floor Address : 2000 Main Street City, Sacramento, CA 95814 City, Huntington Beach , CA 92648 State, Zip : State, Zip: Phone: (916) 552-9983 Phone : (714) 734-5345 Email: Pete .Stamas@waterboards.ca.gov Email : chau.vu@surfcity-hb.org Each party may change its contact upon written notice to the other party. While Party Contacts are contacts for day-to-day communications regarding Project work, the Recipient must provide official communications and notices to the Division's Deputy Director. 4. Conditions precedent to this Agreement are set forth as follows: (a) The Recipient must deliver to the Division a resolution authorizing this Agreement and identifying its authorized representative by title. (b) The Recipient must deliver an opinion of general counsel satisfactory to the State Water Board 's counsel dated on or after the date that the Recipient signs this Agreement. 5. The Recipient represents, warrants, and commits to the following as of the Eligible Work Start Date and continuing thereafter for the term of this Agreement, which shall be at least until the Records Retention End Date: (a) The Recipient agrees to comply with all terms , provisions, conditions , and commitments of this Agreement , including all incorporated documents. (b) The execution and delivery of this Agreement , including all incorporated documents, has been duly authorized by the Recipient. Upon execution by both parties, this Agreement constitutes a valid and binding obligation of the Recipient, enforceable in accordance with its terms , except as such enforcement may be limited by law. (c) None of the transactions contemplated by this Agreement will be or have been made with an actual intent to hinder, delay, or defraud any present or future creditors of Recipient. The EDWG14viii2023 381 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No .: D2302094 Page 2 of 37 Recipient is solvent and will not be rendered insolvent by the transactions contemplated by th is Agreement. The Recipient is able to pay its debts as they become due. The Recipient maintains sufficient insurance coverage considering the scope of this Agreement, including, for example but not necessarily limited to, general liability, automobile liability , workers compensation and employer liability , professional liability. (d) The Recipient is in compliance with all State Water Board funding agreements to which it is a party. 6. This Agreement, and any amendments hereto, may be executed and delivered in any number of counterparts, each of which when delivered shall be deemed to be an original, but such counterparts shall together constitute one document. The parties may sign this Agreement, and any amendments hereto, either by an electronic signature using a method approved by the State Water Board or by a physical , handwritten signature. The parties mutually agree that an electronic signature using a method approved by the State Water Board is the same as a physical , handwritten signature for the purposes of validity , enforceability , and admissibility. 7. The Recipient has reviewed and fully understands the provisions and requirements of this Agreement. The Recipient has reviewed and affirms the representations and warranties in this Agreement. EDWG14viii2023 382 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No .: 02302094 Page 3 of 37 IN WITNESS WHEREOF , this Ag reement has been executed by the parties hereto. CITY OF HUNTINGTON BEACH: C¼wvu By : ____________ _ Name: Chau Vu T itle : Director of Public Works Date : Jun 3, 2024 STATE WATER RESOURCES CONTROL BOARD: /7 /(~rt e15 k,' By :_y_· ___________ _ Name: Joe Karkoski Title: Deputy Director Divis ion of Financ ial Assistance Date : ___ J_u_l _1_1,_2_0_24 ______ _ EDWG14v ill 2023 Adobe Acrobat Sign Transaction Number. C8JCHBCMBAAl8x29bfQSEpfcAXck9mlliN_HVllc7vY3 383 City of Hunti ngton Beach Project No . EDWG-3010053-001 C Ag reement No.: D2302094 Page 4 of 37 EXHIBIT A -SCOPE OF WORK AND SCHEDULE A.1 PROJECT PURPOSE AND DESCRIPTION . The Proj ect is fo r the benefit of the Rec ipie nt. The fund ing under this Agreement shall be used for the purpose of consolidating the Old Pirate Lane water system with the Recip ient. A .2 SCOPE OF WORK . Portions of this scope of wo rk may be funded through separate agreements or programs , including agreements with third-party technical assistance providers . Such tasks may still be included herein to clearly document expectations of the Rec ipient regardi ng implementation of the Project under th is Agreement. Any costs funded through other agreements or programs cannot be submitted for re imbursement under th is Agreement. The Recipient ag rees to do the follow ing : 1. Project Management 1.1 Provide all technica l and administrative services as needed fo r Project completion ; monitor, supervise , and rev iew all work performed ; and coordinate budgeting and scheduling to ensure the Project is completed within budget, on schedule, and in accordance with approved procedures , applicable laws, and reg ulations . 1.2 Notify the Project Ma nager at least fiftee n (15) work ing days in advance of upcom ing meetings , workshops , and trainings. 1.3 Conduct per iodic and f inal site visits w ith the Project Manager. 1.4 Conduct pre-, during, and post-construction photo monitoring at the Project site and submit to the Project Manager as part of Progress Reports . 2. In itial Submissions 2.1 Submit the mandatory Technical, Managerial, and Financial (TMF) Assessment elements, includ ing BudgeUCapital Improvement Plan , Consolidation Feas ibility , Ownersh ip , and Water Rights , to the Project Manager for approval. 2.1.1 Mandatory TMF elements must be met to the satisfaction of the Division prior to Bid Solic itation Approval. 2 .2 Submit the Exped ited Drinking Water Grant (EDWG) Financial Secur ity Package to the Project Manager for approval. 2.2 .1 Divis ion rev iew and approval must be complete p ri or to Bid Solic itation Approval. 2 .3 Complete necessary work to resolve any incomplete items identified by Division after the Division reviews subm ittals for Items 2.1 and 2.2. 2.4 Submit the professional engineering services contract(s) to the Project Manager for review and approval pr ior to disbursement of funds for costs incurred under such contract(s). Exhibit A 384 3. Environmental Compliance, Permitting, and Approvals City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: 02302094 Page 5 of 37 No construction or construction-related activities, including construction bid solicitation , is authorized until the California Environmental Quality Act (CEQA) process , permitting , access negotiations and other required approvals are complete. 3.1 Complete documentation required under the CEQA for the proposed construction project. 3.1.1 Submit the draft CEQA document or Notice of Exemption , as applicable, to the Project Manager for comment. 3.1.2 Submit the complete EDWG Program Environmental Package to the Project Manager, including one of the following : the Notice of Exemption filed with the County Clerk and with the Governor's Office of Planning and Research, State Clearinghouse; or the final CEQA document (Negative Declaration, Mitigated Negative Declaration , or Environmental Impact Report), Mitigation Monitoring and Reporting Plan, comments and responses, adoption/certification resolution, and the Notice of Determination filed with the County Clerk and the Governor's Office of Planning and Research. 3.1.3 Obtain written concurrence from the Project Manager confirming the State Water Board has made its own environmental findings if applicable and concurs that implementation/construction may proceed . The State Water Board may deem the Project ineligible for funding if construction begins prior to the Division's issuance of this written approval. 3.2 Obtain all public agency approvals, entitlements, permits, and agreements, if any, that are required for Project implementation before field work begins. 3.2.1 Submit evidence of any necessary California Public Utilities Commission (CPUC) approvals and notice to the CPUC of the receipt of grant funds. 3.2 .2 If the Project is carried out on lands not owned by the Recipient, the Recipient must obtain adequate property rights or rights of way for the Useful Life of the Project. 3.2.3 If the Project requires or involves the diversion or appropriation of water, the Recipient must submit appropriate documentation showing that Recipient has acquired necessary water rights . 3.2.4 If the Project is a consolidation, the Recipient must submit an executed copy of the consolidation agreement(s) in a form satisfactory to the Division. Recipients are strongly advised to share a draft of the consolidation agreement(s) with the Project Manager, and to incorporate comments from the Project Manager before the agreement is finalized. 3.2 .5 Submit evidence of any necessary Local Agency Formation Commission approvals. 3.2 .6 Submit a list and signed copies of any other necessary approvals, entitlements, permits, and agreements to the Project Manager. 4. Planning , Design , and Engineering 4.1 Prepare an Engineering Report, Technical Memo, or similar document to support the design plans and specifications in Item 4 .2 , and submit to the Project Manager for comment. Exhibit A 385 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No .: D2302094 Page 6 of 37 4 .2 Prepare the fifty percent (50%) design plans and spec ifications and submit to the Project Manager for approval. The Project shall include : Distribution System Components • Install approximately 300 feet of new water main. • Install hydrants and isolat ion valves accord ing to the spacing requirements specified in the City's standards. • Furnish and install water meters and laterals for approximately 13 existing customers. Consolidation Project Components • Consolidate the Old Pirate Lane water system into the City of Huntington Beach. • Decommission and properly abandon the existing well , piping , and other equipment with in the Old Pirate Lane water system , in accordance with the requirements set forth by the City of Huntington Beach and the Orange County Health Care Agency. 4.3 Complete the one hundred percent (100%) design plans and specifications and prepare a summary ident ifying any changes from the fifty percent (50%) plans in Item 4 .2. Submit the one hundred percent (100%) design plans and specifications and summary of changes for the Project to the Project Manager for approval. 5. Bid Solicitation 5.1 Complete the bid documents in accordance with the approved design plans and specifications in Item 4 .3 and submit to the Project Manager for approval. 5.2 Complete EDWG Request for Bid Solicitation Approval Form, after obta ining : TMF approval in Item 2.1, Financial Security Package approval in Item 2.2, environmental clearance in Item 3.1.3, and the necessary approvals , entitlements , permits , and agreements in Item 3.2. Submit to the Project Manager to obtain written Bid Solicitation Approval. 5.3 Advertise the Project for bid after receiving Project Manager approval in Item 5.2. Submit comp lete EDWG Final Budget Approval (FBA) Form, including necessary attachments , such as the advertised bid documents and bid summary , to obtain written FBA from the Project Manager. 6. Construction and Implementation Construction , equipment procurement, or acquisit ion costs are not elig ible for reimbursement prior to FBA . 6.1 After receiving FBA, award the construction contract(s) and submit the Notice(s) to Proceed and awarded contract(s) for the Project to the Project Manager. 6.2 Submit any proposed changes that arise during construct ion that may affect the Project's benefits and components listed in Item 4.2, schedule, or costs to the Project Manager for approval prior to proceeding with the changes . 6.3 Submit the necessary TMF Assessment elements to the Project Manager by the Completion of Construction . Exhibit A 386 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 7 of 37 6.3.1 Prior to disbursement of the final 10% of the total Project Costs, necessary TMF elements must be demonstrated to the satisfaction of the Division, which may include elements that will be subsequently completed under DOW supervision. 6.4 Submit any required drinking water permit amendment application documents to the regulating agency (Division of Drinking Water, Local Primacy Agency, County Health Department, etc.) and the Project Manager before the Completion of Construction (if applicable). 6.5 Construct the Project in accordance with the approved design plans and specifications in Item 4.3. 6.6 Expeditiously initiate Project operations upon Completion of Construction. A.3 SIGNAGE. The Recipient must place a professionally prepared sign at least four feet tall by eight feet wide made of ¾ inch thick exterior grade plywood or other approved material in a prominent location on the Project site and must maintain the sign in good condition for the duration of Project implementation . The sign may include another agency's required information and must include , prominently displayed, the following disclosure statement and color logos (available from the Division): Water Boards '"" ....... , ............. ····· ---............................ , ..... "Funding for this project has been provided in full or in part under the Budget Act of 2021 through an agreement with the State Water Resources Control Board ." A.4 SCHEDULE. Failure to provide items by the due dates indicated in the table below may constitute a material violation of this Agreement. The Division may adjust the dates in the "Estimated Due Date" column of this table, but "Critical Due Date" adjustments will require an amendment to this Agreement. As applicable for specific submittals, the Recipient must plan adequate time to solicit, receive , and address comments prior to submitting the final submittal. The Recipient must substantially complete construction by the approved Estimated Completion of Construction date unless an extension is granted by the Division in writing. The Recipient must deliver any request for extension no less than 30 days prior to the approved Estimated Completion of Construction date. Late requests may not be honored. · The Recipient must complete and submit all work in time to be approved by the Division prior to the approved Estimated Due Date for the Final Reimbursement Request. ITEM I DESCRIPTION OF SUBMITTAL I CRITICAL DUE I ESTIMATED DUE DATE DATE EXHIBIT A .2 -SCOPE OF WORK Exhibit A 387 ITEM DESCR IPTION OF SUBMITTAL 1. Project Management 1.1 Technical and Administrative Services 1.2 Notification of Upcoming Meetings , Workshops, and Trainings 1.3 Site Visits 1.4 Photo Documentation 2. Initial Submissions 2.1 Mandatory TMF Assessment Elements 2.2 EDWG Financial Package 2.3 Complete any incomplete items identified by Division after review of 2 .1 and 2.2. 2.4 Professional Engineering Services Contract 3. Environmental Compliance and Permitting 3.1.1 Draft CEQA 3.1.2 EDWG Environmental Package and Final CEQA 3.2.1 California Public Utilities Commission Approvals 3.2.2 Property Rights or Rights of Way 3.2.3 Documentation of Necessary Water Rights 3.2.4 Consolidation Agreement(s} 3.2.5 Local Agency Formation Commission Approvals 3.2.6 List and Signed Copies of Any other Necessary Approvals , Entitlements, Permits , and Agreements 4. Planning, Design, and Engineering 4.1 Engineering Report, Technical Memo , or Similar Document 4 .2 50% Plans and Specifications 4.3 100% Plans and Specifications 5. Bid Solicitation 5.1 Bid Documents Exhibit A City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: 02302094 Page 8 of 37 CRITICAL DUE ESTIMATED DUE DATE DATE N/A Ongoing N/A As Needed NIA As Needed N/A Ongoing N/A Completed N/A Completed N/A Completed N/A Prior to disbursement of any related costs N/A N/A N/A Completed N/A N/A N/A February 1, 2025 N/A N/A N/A November 1, 2024 N/A NIA N/A February 1, 2025 N/A Completed N/A November 1, 2024 N/A February 1, 2025 N/A N/A 388 ITEM DESCRIPTION OF SUBMITTAL 5.2 EDWG Request for Bid Solicitation Approval 5.3 EDWG Request for Final Budget Approval Form 6. Construction and Implementation 6.1 Notice(s) to Proceed 6.2 Notification of Project Changes 6.3 Necessary TMF Elements 6.4 Permit Amendment Application Documents 6.5 Completion of Construction 6.6 Project Completion REPORTS A.5 Progress Reports A.6 Project Completion Report A.7 Final Inspection and Certification City of Huntington Beach Project No. EDWG-3010053-001C Agreement No.: D2302094 Page 9 of 37 CRITICAL DUE ESTIMATED DUE DATE DATE N/A March 1, 2025 N/A April 1, 2025 NIA N/A N/A As Needed N/A Completed N/A N/A N/A February 1, 2026 February 1, 2026 N/A Quarterly N/A N/A March 1, 2026 N/A March 1 , 2026 EXHIBIT BUDGET COSTS AND REIMBURSEMENT BANDC - FUNDING TERMS B.6 .1 and First Reimbursement Request No later than 90 N/A B.6.2 days from Agreement Execution Date C.16 Final Reimbursement Request March 1, 2026 6 months after approved Completion of Construction date or the Critical Due Date for Final Reimbursement Request, whichever comes first A.5 PROGRESS REPORTS . The Recipient must provide a progress report to the Division each quarter, beginning no later than 90 days after execution of this Agreement. The Recipient must provide a progress report with each Reimbursement Request. Failure to provide a complete and accurate progress report may result in the Exhibit A 389 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 10 of 37 withholding of Project Funds, as set forth in Exhibits B and C. A progress report must contain the follow i ng information : 1. A summary of prog ress to date incl uding a description of progress since the last report , percent construction complete , percent contractor invoiced , and percent schedule elapsed; 2 . Discussion of any delays experienced or antic ipated in meet ing the project schedule provided in Section A.4 and measures to meet the schedule ; 3. A description of compliance with environmental requirements , including a discussion of the status of the Rec ipient 's compliance with a. any Mitigation Monitoring and Reporting Program adopted for the Project ; and b. any permits issued for the Project that include water quality elements , including Clean Water Act, Section 401 Certification or Section 404 Permit, Lake and Streambed Alteration Agreement, and/or Rivers and Harbors Act, Sect ion 1 O Permit issued by the . relevant state and federal agencies. 4. A listing of change orders including amount , description of work , and change in contract amount and schedule; and 5. Any problems encountered , proposed resolution , schedule for resolution , and status of previous problem resolutions . A.6 PROJECT COMPLETION REPORT. (a) The Recipient must submit a Proj ect Complet ion Report to the Divis ion with a copy to the appropriate Distr ict Office on or before the due date established by the Division and the Recipient at the time of final project inspection . The Proj ect Completion Report must include the following : i. Description of the Project , ii. Description of the water quality problem the Project sought to address , iii. Discussion of the Project's likelihood of successfully addressing that water quality problem in the future , and iv. Summary of compl iance with applicable environmental requirements, including a discussion of the status of the Recipient's compl iance with a. any Mit igation Monitoring and Reporting Program adopted for the Project ; and b . any permits issued for the Project that include water quality elements , including Clean Water Act , Section 401 Certification or Section 404 Permit , Lake and Streambed Alterat ion Agreement , and/or Rivers and Harbors Act , Section 10 Permit issued by the relevant state and federal agencies . (b) If the Recipient fails to submit a timely Project Completion Report , the State Water Boa rd may stop processing pend ing or future applicat ions for new financial assistance, withhold reimbursements under this Agreement or other agreements, and begin administrative proceedings . A.7 FINAL PROJECT INSPECTION AND CERTIFICATION. Upon completion of the Project , the Recipient must provide for a final inspection and must certify that the Project has been completed in accordance w ith this Agreement , any final plans and specifications subm itted to the State Water Board, and any amendments or modifications thereto. If the Project involves the planning, investigati on , evaluation , des ign , or other work requir i ng interpretation and proper application of engineering , or other professionals , the final inspection and certification must be conducted by a California Registered Civil Eng i neer or other appropr iate California registered profess ional. The results of the final inspection and certification must be submitted to the Project Manager. Exhibit A 390 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No .: D2302094 Page 11 of 37 EXHIBIT B -FUNDING PROVISIONS B.1 ESTIMATED REASONABLE COST AND PROJECT FUNDS. The estimated reasonable cost of the total Project is set forth on the Cover Page of this Agreement , and is greater than or equal to the funding anticipated to be provided by the State Water Board under th is Agreement. Subject to the terms of this Agreement , the State Water Board agrees to provide Project Funds not to exceed the amount of the Project Funding Amount set forth on the Cover Page of this Agreement. B.2 RECIPIENT CONTRIBUTIONS. The Recipient must pay any and all costs connected with the Project including , without limitation , any and all Project Costs. If the Project Funds are not sufficient to pay the Project Costs in full , the Recipient must nonetheless complete the Project and pay that portion of the Project Costs in excess of available Project Funds, and shall not be entitled to any re imbursement therefor from the State Water Board . If the Recipient obtains funds for the Project from any third parties , the Recip ient shall immediately notify the Division. The amount of th is Agreement may be reduced to reflect such funds. B.3 VERIFIABLE DATA. Upon request by the Division , the Rec i pient must submit verifiable data to support deliverables specified in the Scope of Work. The Rec ipient's failure to comply with this requirement may be construed as a material breach of this Agreement. B.4 BUDGET COSTS. Estimated budget costs are contained in the Summary Project Cost Table below. ITEM DESCRIPTION TOTAL ESTIMATED TOTAL FUNDING COST AMOUNT A Construction $0 $0 B Pre-Purchased Material/ Equipment $0 $0 C Real Property or Easement Acquisition $1 ,500 $1,500 D Change Order Contingency $23,907 $23,907 E Force Account $159 ,378 $159 ,378 F Allowances $26,000 $26 ,000 G Water Capital Facilities Fees1 $74,386 $74,386 H Conditional Cost $42,776 $42 ,776 TOTAL $327,947 $327,947 Notes: 1 Water Capital Facilities Fees for installing 13 meters , based on the C ity's current fee schedule. The Division 's Final Budget Approval(s) and related Forms 259 and 260 will document a more detailed budget of elig ible Project Costs and Project funding amounts. Construction of the Project may be completed i n phases only with written approval of the Div ision . If construction proceeds under separate phases , the Recipient must submit a Final Budget Approval package and receive Final Budget Approval from the Division for each phase. The Recipient is prohibited from requesting disbursement amounts that represent Recip ient's mark-ups to costs invoiced or otherwise requested by consultants or contractors . Exhibit B 391 City of Huntington Beach Project No . EDWG-3010053-001 C Agreement No.: D2302094 Page 12 of 37 Reimbursement of costs under the Conditional Costs line item is not authorized without the Division 's written approval. The Conditional Costs line item is for increased costs and unforeseen items, provided that the costs are eligible and consistent with the approved scope of work of this Agreement and are determined to be reasonable and necessary by the Division. The Recipient must contact the Project Manager with any requests to use the Condit ional Costs line item; approval is subject to the Division's discretion . The Division will not approve the use of Conditional Costs for construction costs and construction change orders until after it has provided a Final Budget Approval for the Project. B.5 LINE ITEM ADJUSTMENTS. 1. The Recipient may submit a request for an adjustment between line items of the budget in writing to the Project Manager for the Division 's review and approval. Such adjustment may not increase or decrease the total Project Funding Amount. The Recipient shall submit a copy of the Agreement budget reflecting the requested changes and shall note proposed changes by striking out the original amount(s) followed with proposed change(s) in bold and underlined. Budget adjustments deleting a budget line item or adding a new budget line item shall require a formal amendment. The Division may also propose budget adjustments. 2. The Division may adjust the funding amounts of the line items of the budget as follows , in accordance with any applicable rules. Under no circumstances may the sum of line items in the approved budget exceed the Project Funding Amount set forth on the Cover Page of this Agreement. (a) The Division may adjust the budget for existing line items, other than the Contingency and Conditional Costs line items , by shifting funds from one line item to another. The sum of all line item adjustments approved by the Division for this Agreement must not exceed fifteen percent (15%) of the total Project Funding Amount. If the Div ision modifies the budget (i) at the time of the Division 's Final Budget Approval(s), (ii) by amending the Agreement, or (iii) following the Recipient's submittal of its final Reimbursement Request , then any adjustments that were made prior to such modification of the budget shall not be counted in the calculation of the 15% limit. (b) At the time of the Division's Final Budget Approval(s) and/or any amendments to the Agreement, the Division may adjust the amounts allocated to the line items of the budget at its discretion . Any adjustments at these times are not subject to the 15% limit in paragraph a. (c) Following the Recipient 's submittal of its final Reimbursement Request, the Division may adjust the amounts allocated to the line items of the budget at its discretion . Any adjustments at this time are not subject to the 15% limit in paragraph a. 3. No line item adjustment is authorized until the Division provides written approval for the adjustment to the Recipient. Any line item adjustments to the budget that are due to a change in scope of work will require an Agreement amendment. B.6 REIMBURSEMENT PROCEDURE. Except as may be otherwise provided in this Agreement , reimbursements will be made as follows : 1. Upon execution and delivery of this Agreement by both part ies , the Recipient may request immediate reimbursement of any eligible incurred planning and design allowance costs through submission to the State Water Board of the Reimbursement Request Form 260 and Form 261, or Exhibit B 392 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 13 of 37 any amendment thereto, duly completed and executed, except that the Recipient may not acquire or request reimbursement of costs for materials , equ ipment , or land until after any required environmental review process is complete and the Divis ion provides written notice that such items may be reimbursed under this Agreement. To be eligible for reimbursement, Project Costs , including any planning and design allowance costs , must have been incurred in compl iance with all applicable requirements, including the state cross-cutting requirements listed in Exhibits C and D. 2 . The Recipient must submit a Reimbursement Request for costs incurred prior to the date this Agreement is executed by the State Water Board no later than ninety (90) days after this Agreement is executed by the State Water Board . Late Reimbursement Requests may not be honored. 3 . Additional Project Funds will be promptly d isbursed to the Recipient upon receipt of Reimbursement Request Form 260 and Form 261, or any amendment thereto, duly completed and executed by the Recipient for incurred costs consistent with this Agreement, along with receipt of progress reports due under this Agreement. 4. The Reci pient shall not solicit construction bids or conduct any construction activities until the Division has provided written bid solicitation approval. The Division will not provide bid solicitation approval unt il after the Div ision completes its applicable review, which will include but not be limited to environmental review . 5. The Recipient must not request reimbursement for any Project Cost until such cost has been incurred and is currently due and payable by the Recipient, although the actual payment of such cost by the Rec ipient is not required as a condition of Reimbursement Request. Supporting documentation (e .g ., receipts) must be submitted with each Reimbursement Request. The amount requested for Recipient 's administration costs must include a calculation formula (i.e ., hours or days worked times the hourly or daily rate = total amount claimed). Reimbursement of Project Funds will be made only after receipt of a complete , adequately supported, properly documented, and accurately addressed Reimbursement Request. Upon request by the Division , supporting documents for professional and administrative services must include the employees' names , classifications , labor rates , hours worked , and descriptions of the tasks performed. Reimbursement Requests submitted without supporting documents may be wholly or partially withheld at the discretion of the Div ision. 6. The Recipient must spend Project Funds within 30 days of receipt. If the Recipient earns interest earned on Project Funds , it must report that interest immediately to the State Water Board . The State Water Board may deduct earned interest from future reimbursements . 7. The Recipient must not request a reimbursement unless that Project Cost is allowable , reasonable , and allocable. 8 . Notwithstanding any other provision of this Agreement , no reimbursement shall be required at any time or in any manner which is in violation of or in conflict with federal or state laws , policies , or regulations. Notwithstanding any other provision of this Agreement , the Recipient agrees that the State Water Board may retain an amount equal to ten percent (10%) of the Project Funding Amount until Project Completion. Any retained amounts due to the Recipient will be promptly disbursed to the Recip ient, without interest , upon Project Completion . No Project construction shall proceed until after the Division has provided approval for construction to proceed . Construction costs incurred prior to the date that the D ivision provides approval to proceed are Exhibit B 393 City of Huntington Beach Project No. EDWG -3010053-001 C Agreement No.: D2302094 Page 14 of 37 not eligible for reimbursement. No disbursement for construction costs shall be provided until after the Division has approved the final budget form(s) submitted by the Recipient including the applicable costs. 8.7 REVERTING FUNDS AND DISENCUMBRANCE . In the event the Recipient does not submit Reimbursement Requests for all funds encumbered under this Agreement timely , any remaining funds revert to the State . The State Water Board may notify the Recipient that the project file is closed, and any remaining balance will be disencumbered and unavailable for further use under the Agreement. Exhibit B 394 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 15 of 37 EXHIBIT C -GENERAL TERMS AND CONDITIONS GENERAL TERMS AND CONDITIONS 2019-NOV is posted at https://www.waterboards.ca .gov/water issues/programs/grants loans/general terms .html and replicated below: 1. DEFINITIONS . Unless otherwise specified in this Agreement, each capitalized term used in this Agreement has the following meaning: • "Agreement" means this agreement, including all exhibits and attachments hereto. • "Cover Page" means the front page of this Agreement. • "Days " means calendar days unless otherwise expressly indicated. • "Deputy Director" means the Deputy Director of the D ivision. • "Division " means the Division of Financial Assistance of the State Water Board or any other division or unit of the State Water Board authorized to administer this Agreement. • "Event of Default" means the occurrence of any of the following events: a) A representation or warranty made by or on behalf of the Recipient in this Agreement or in any document furnished by or on behalf of the Recip ient to the State Water Board pursuant to this Agreement shall prove to have been inaccurate, misleading or incomplete in any material respect ; b) Failure by the Recipient to observe and perform any covenant , condition , or provision in this Agreement, which failure shall continue for a period of time, to be determined by the Division ; c) In itiation of proceed ings seeking arrangement , reorganization , or any other relief under any applicable bankruptcy, insolvency, or other similar law ; the appointment of or taking possession of the Recipient 's property by a receiver , liquidator, assignee, trustee , custod ian , conservator, or similar official ; the Recipient's entering i nto a general assignment for the benefit of creditors ; the initiation of resolutions or proceedings to terminate the Recipient's existence, or any action in furtherance of any of the foregoing ; d) A determination pursuant to Gov. Code section 11137 that the Recipient has violated any prov ision in Article 9.5 of Chapter 1 of Part 1 of Division 3 of Title 2 of the Government Code; or e) Loss of the Recipient's rights , licenses, permits, or privileges necessary for the Project, or the occurrence of any material restra int on the Recipient 's enterprise by a government agency or court order. • "Final Reimbursement Request Date" means the date set forth as such on the Cover Page of this Agreement , after which date, no further reimbursements or disbursements may be requested . • "Fiscal Year'' means the period of twelve (12) months terminating on June 30 of any year. • "GAAP" means generally accepted accounting principles , the uniform accounting and reporting procedures set forth in publications of the American Institute of Certified Public Accountants or its Exhib it C 395 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: 02302094 Page 16 of 37 successor, or by any other generally accepted authority on such procedures, and includes, as applicable, the standards set forth by the Governmental Accounting Standards Board or its successor, or the Uniform System of Accounts, as adopted by the California Public Utilities Commission for water utilities . • "Material Obligation" means an obligation of the Recipient that is material to this transaction. • "Party Contact" means, for the Recipient , the Authorized Representative of the Recipient or any designee of the Authorized Representative, and, for the State Water Board, the Division staff set forth in Section 2 of this Agreement. • "Project" means the Project funded by this Agreement as described in Exhibits A and B and in the documents incorporated by reference herein . • "Project Completion" means, as determined by the Division, that the Project is complete to the reasonable satisfaction of the Division. • "Project Costs" means the incurred costs of the Recipient which are eligible for funding under this Agreement, pursuant to applicable statutes, policy, regulations, or guidelines . • "Project Funding Amount" means the maximum amount payable under this Agreement, as set forth on the Cover Page. • "Project Funds" means all moneys disbursed to the Recipient by the State Water Board for eligible Project Costs pursuant to this Agreement. • "Project Manager" means the person designated by the State Water Board to manage performance of this Agreement. The Project Manager is set forth on the Cover Page. • "Records Retention End Date" means the last date that the Recipient is obligated to maintain records related to this Agreement and is set forth on the Cover Page of this Agreement. • "Regional Water Quality Control Board" or "Regional Water Board" means the appropriate Regional Water Quality Control Board. • "Reimbursement Period" means the period during which Project Funds may be disbursed. • "Reimbursement Request" means the Recipient's request for Project Funds from the State Water Board as set forth in Exhibit B. • "State" means State of California. • "State Water Board" means the State Water Resources Control Board . • "Work Completion" means the Recipient's submittal of all work set forth under Exhibit A for review and approval by the Division. • "Work Completion Date" means the date set forth on the Cover Page of this Agreement and is the last date on which Project Costs may be incurred under this Agreement. • "Year" means calendar year unless otherwise expressly indicated. Exhibit C 396 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No .: D2302094 Page 17 of 37 2. ACCESS, INSPECTION, AND PUBLIC RECORDS . The Recipient must ensure that the State Water Board, the State Auditor, or any authorized representative of the foregoing, will have safe and suitable access to the Project site at all reasonable times through the Records Retention End Date or useful life of the Project , whichever is longer. The Recipient acknowledges that, except for a subset of information regarding archaeological records and personally identifiable information, the Project records and locations may be public records, including but not limited to all of the submissions accompanying the application, all of the documents incorporated into this Agreement by reference, and all reports, Reimbursement Requests, and supporting documentation submitted hereunder. 3. ACCOUNTING AND AUDITING STANDARDS; FINANCIAL MANAGEMENT SYSTEMS. The Recipient must maintain GAAP-compliant project accounts, including GAAP requirements relating to the reporting of infrastructure assets . Without limitation of the requirement to maintain Project accounts in accordance with GAAP, the Recipient must: (a) Establish an official file for the Project which adequately documents all significant actions relative to the Project; (b) Establish separate accounts which will adequately and accurately depict all amounts received and expended on the Project, including all Project Funds received under this Agreement; (c) Establish separate accounts which will adequately depict all income received which is attributable to the Project, specifically including any income attributable to Project Funds disbursed under this Agreement; ( d) Establish an accounting system which will accurately depict final total costs of the Project if authorized under this Agreement; (e) Establish such accounts and maintain such records as may be necessary for the State to fulfill federal reporting requirements, including any and all reporting requirements under federal tax statutes or regulations; and (f) If the Recipient uses its own employees , equipment, or resources for any phase of the Project, accounts will be established which reasonably document all employee hours charged to the Project and the associated tasks performed by each employee. 4 . AMENDMENT. No amendment or variation of the terms of this Agreement shall be valid unless made in writing and signed by both the Recipient and the Deputy Director or designee and approved as required. 5. ASSIGNABILITY. This Agreement is not assignable by the Recipient , either in whole or in part, without the consent of the State Water Board . Amendment of the Agreement may be required . 6 . AUDIT. The Division may call for an audit of financial information relative to the Project if the Division determines that an audit is desirable to assure program integrity or if an audit becomes necessary because of State or federal requirements. If an audit is called for, the audit must be performed by a certified public accountant independent of the Recipient and at the cost of the Recipient. The audit must be in the form required by the Division. The Recipient must return, or ensure the return of, any audit disallowances within 30 days. 7. BONDING. Where construction contractors are used, the Recipient must not authorize construction to begin until each contractor has furnished a performance bond in favor of the Recipient in the following amounts : faithful performance (100%) of contract value; labor and materials (100%) of contract value. This requirement shall not apply to any contract for less than $25,000.00 . Exhibit C 397 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 18 of 37 8. COMPETITIVE BIDDING. Recipient must adhere to any applicable State law or local ordinance for competitive bidding and applicable labor laws . If Recipient is a private entity, any construction contracts related in any way to the Project must be let by competitive bid procedures which assure award of such contracts to the lowest responsive and responsible bidders. Recipient must not award a construction contract until a summary of bids and identification of the selected lowest responsible bidder is submitted to and approved in writing by the Division. Recipient must provide a full explanation if Recipient is proposing to award a construction contract to anyone other than the lowest responsible bidder. 9. COMPLIANCE WITH APPLICABLE LAWS, RULES, AND REQUIREMENTS. The Recipient must, at all times, comply with and require its contractors and subcontractors to comply with all applicable federal and State laws, rules, guidelines, regulations, and requirements and with provisions of the adopted environmental mitigation plan, if any, for the useful life of the Project. 10. COMPUTER SOFTWARE. The Recipient certifies that it has appropriate systems and controls in place to ensure that State funds will not be used in the performance of this Agreement for the acquisition, operation or maintenance of computer software in violation of copyright laws. 11. CONFLICT OF INTEREST. The Recipient certifies that it, its owners, officers, directors, agents, representatives, and employees are in compliance with applicable State and federal conflict of interest laws and will remain in compliance for the useful life of the Project. Any service provider or contractor with which the Recipient contracts must not have any role or relationship with the Recipient, that, in effect, substantially limits the Recipient's ability to exercise its rights, including cancellation rights, under the contract, based on all the facts and circumstances. Public entities are required to have adopted conflict of interest codes and may be required to provide documentation of those codes to the Division. 12. DATA MANAGEMENT. The Recipient will undertake appropriate data management activities so that Project data can be incorporated into statewide data systems. 13. DEBARRED, DISQUALIFIED, OR EXCLUDED CONTRACTORS. The Recipient must not contract or allow subcontracting with excluded parties. The Recipient must not contract with any party who is debarred or suspended or otherwise excluded from or ineligible for participation in any work overseen, directed, funded, or administered by the State Water Board program for which this funding is authorized. For any work related to this Agreement, the Recipient must not contract with any individual or organization on the State Water Board's List of Disqualified Businesses and Persons that is identified as debarred or suspended or otherwise excluded from_ or ineligible for participation in any work overseen, directed, funded, or administered by the State Water Board program for which funding under this Agreement is authorized. The State Water Board's List of Disqualified Businesses and Persons is located at: http://www.waterboards.ca.gov/water issues/programs/enforcement/fwa/dbp.shtml 14. DRUG-FREE WORKPLACE. The Recipient certifies that it will provide a drug-free workplace in compliance with the Drug-Free Workplace Act (Gov. Code. §§ 8350-8357). The Recipient shall publish a statement notifying employees that the unlawful manufacture, distribution, dispensation, possession, or use of a controlled substance is prohibited in the Recipient's workplace and specifying the actions to be taken against employees for violations of the prohibition. The Recipient shall establish a drug-free awareness program to inform employees about the dangers of drug abuse in the workplace, the Recipient's policy of maintaining a drug-free workplace, any available drug counseling, rehabilitation and employee assistance programs, and penalties that may be imposed upon employees for drug abuse violations . The Recipient shall provide that every employee who works on the Project receives a copy of the Recipient's drug-free workplace policy statement and agrees to abide by the terms of the statement as a condition of employment on the Project. Exhibit C 398 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 19 of 37 15. ENVIRONMENTAL CLEARANCE. No work that is subject to California Environmental Quality Act (CEQA) or the National Environmental Policy Act (NEPA) may proceed under this Agreement until the State Water Board has provided approval to proceed. Upon receipt and review of the Recipient's environmental documents, the State Water Board shall make the appropriate environmental findings before determining whether to approve construction or implementation funding for the Project under this Agreement. Providing approval for such construction or implementation funding is fully discretionary. The State Water Board may require changes in the scope of work or additional mitigation as a condition to providing construction or implementation funding under this Agreement. Recipient shall not perform any work subject to CEQA and/or NEPA before the State Water Board completes its environmental review and specifies any changes in scope or additional mitigation that may be required . Proceeding with work subject to CEQA and/or NEPA without approval by the State Water Board shall constitute a breach of a material provision of this Agreement. If this Project includes modification of a river or stream channel, the Rec ipient must fully mitigate environmental impacts resulting from the modification. The Recipient must provide documentation that the environmental impacts resulting from such modification will be fully mitigated considering all of the impacts of the modification and any mitigation, environmental enhancement, and environmental benefit resulting from the Project, and whether, on balance, any environmental enhancement or benefit equals or exceeds any negative environmental impacts of the Project. 16. FINAL REIMBURSEMENT REQUEST. The Recipient agrees to ensure that its final Reimbursement Request is received by the Division no later than the Final Reimbursement Request Date, unless prior approval has been granted by the Division. If the final Reimbursement Request is not received timely, the undisbursed balance of this Agreement may be deobligated. 17. FRAUD AND MISUSE OF PUBLIC FUNDS . All requests for disbursement must be accurate and signed by the Recipient or its Authorized Representative under penalty of perjury. All costs submitted pursuant to this Agreement must only be for the work or tasks set forth in this Agreement. The Recipient must not submit any invoice containing costs that are ineligible or have been reimbursed from other fund ing sources unless required and specifically noted as such (i.e., match costs). Any costs for which the Recipient is seeking reimbursement shall not be reimbursed from any other source. Double or mult iple billing for time, services , or any other cost is improper and will not be compensated. Any suspected occurrences of fraud, forgery , embezzlement, theft, or any other misuse of public funds may result in suspension of disbursements and, notwithstanding any other section in this Agreement , the termination of this Agreement requiring the immediate repayment of all funds disbursed hereunder. Add itionally, the Deputy Director of the Division may request an audit and refer the matter to the Attorney General's Office or the appropriate district attorney's office for criminal prosecution or the imposition of civil liability. 18. FUNDING CONTINGENCY. The State Water Board's disbursement of funds hereunder is contingent on the Recipient 's compliance with the terms and condit ions of this Agreement. The State Water Board's obligation to disburse funds is contingent upon the availability of sufficient funds to permit the disbursements provided for herein . If sufficient funds are not available for any reason, including but not limited to failure of the federal or State government to appropriate funds necessary for disbursement of funds, the State Water Board shall not be obligated to make any disbursements to the Recipient under this Agreement. If this Agreement's funding for any fiscal year expires due to reversion or is reduced, substantially delayed , or deleted by the Budget Act , by Executive Order, or by order or action of the Department of Finance , the State Water Board has the option to either cancel this Agreement with no liability accruing to the State Water Board, or offer an amendment to the Recipient to reflect the reduced amount. This provision shall be construed as a condition precedent to the obligation of the State Water Board to make any disbursements under this Agreement. Nothing in this Agreement shall be construed to provide the Recipient with a right of priority for disbursement over any other entity. If any disbursements due the Recipient under this Agreement are deferred because sufficient funds are unavailable, it is the intention of the State Water Exhibit C 399 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No .: D2302094 Page 20 of 37 Board that such disbursement will be made to the Recipient when sufficient funds do become available, but this intention is not binding . 19. GOVERNING LAW. This Agreement is governed by and shall be interpreted in accordance with the laws of the State of California. 20. RECIPIENT'S SHARE. The Recipient agrees that it will provide for the payment of its full share , if any share is required , of Project Costs and that all costs connected with the Project will be timely paid by the Recipient. 21 . INDEMNIFICATION AND STATE REVIEWS. The parties agree that review or approval of Project plan's and specifications by the State Water Board is for administrative purposes only, including conformity with application and eligibility criteria , and expressly not for the purposes of design defect review or construction feasibility, and does not relieve the Recipient of its responsibility to properly plan, design , construct, operate, and maintain the Project. To the extent permitted by law, the Recipient agrees to indemnify , defend, and hold harmless the State Water Board and any trustee , and their officers, employees, and agents for the Bonds, if any (collectively , "Indemnified Persons"), against any loss or liability arising out of any claim or action brought against any Indemnified Persons from and against any and all losses , claims, damages , liabilities, or expenses , of every conceivable kind , character , and nature whatsoever arising out of, resulting from , or in any way connected with (1) the Project or the conditions, occupancy, use, possession, conduct , or management of, work done in or about, or the planning, design, acquisition, installation, or construct ion, of the Project or any part thereof; (2) the carrying out of any of the transactions contemplated by this Agreement or any related document ; (3) any violation of any applicable law, rule or regulation, any environmental law (including, without limitation, the Federal Comprehensive Environmental Response, Compensation and Liability Act, the Resource Conservation and Recovery Act, the Cal ifornia Hazardous Substance Account Act, the Federal Water Pollution Control Act , the Clean Air Act , the Toxic Substances Control Act , the Occupational Safety and Health Act , the Safe Drinking Water Act, the California Hazardous Waste Control Law, and California Water Code Section 13304, and any successors to said laws), rule or regulation or the release of any toxic substance on or near the Project ; or (4) any untrue statement or alleged untrue statement of any material fact or omission or alleged omission to state a material fact necessary to make the statements required to be stated therein, in light of the circumstances under which they were made , not misleading with respect to any information provided by the Recipient for use in any disclosure document utilized in connection with any of the transactions contemplated by this Agreement , except those arising from the gross negligence or willful misconduct of the Indemnified Parties. The Recipient must also provide for the defense and indemnification of the Indemn ified Persons in any contractual provision extending indemnity to the Recipient in any contract let for the performance of any work under this Agreement, and must cause the Indemnified Parties to be included with in the scope of any provision for the indemnification and defense of the Recipient in any contract or subcontract. To the fullest extent permitted by law, the Recipient agrees to pay and discharge any judgment or award entered or made against Indemnified Persons with respect to any such claim or action, and any settlement, compromise or other voluntary resolution . The provisions of this section surv ive the term of this Agreement. 22. INDEPENDENT ACTOR. The Recipient , and its agents and employees, if any, in the performance of this Agreement , shall act in an independent capacity and not as officers , employees , or agents of the State Water Board. 23. INSPECTION. Throughout the useful life of the Project , the State Water Board shall have the right to inspect the Project area to ascertain compliance w ith th is Agreement. 24. INTEGRATION. This Agreement constitutes the complete and final agreement between the parties . No oral or written understanding or agreement not incorporated in this Agreement shall be binding on either party. Exhibit C 400 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No .: D2302094 Page 21 of 37 25 . LIENS. The Recipient must not make any pledge of or place any lien on the Project or Project assets except upon consent of the Division. 26. NO DISCRIMINATION. The Recipient must comply with Government Code section 11135 and the implementing regulations (Cal. Code Regs, tit. 2, § 11140 et seq.), including, but not limited to , ensuring that no person is unlawfully denied full and equal access to the benefits of, or unlawfully subjected to discrimination in the operation of, the Project on the basis of sex, race , color, religion, ancestry, national origin, ethnic group identification, age, mental disability, physical disability , medical condition, genetic information, marital status, or sexual orientation as such terms are defined under California law, for as long as the Recipient retains ownership or possession of the Project. If Project Funds are used to acquire or improve real property, the Recipient must include a covenant of nondiscrimination running with the land in the instrument effecting or recording the transfer of such real property. The Recipient must comply with the federal American with Disabilities Act of 1990 and implementing regulations as required by Government Code section 11135(b ). The Recipient's obligations under this section shall survive the term of this Agreement. During the performance of this Agreement, Recipient and its contractors and subcontractors must not unlawfully discriminate , harass, or allow harassment against any employee or applicant for employment because of sex, race, color, ancestry, religious creed, national origin , sexual orientation , physical disability (including HIV and AIDS}, mental disability, medical condition (cancer), age (over 40), marital status , denial of family care leave, or genetic information, gender, gender identity , gender expression , or military and veteran status. The Recipient , its contractors, and subcontractors must ensure that the evaluation and treatment of their employees and applicants for employment are free from such discrimination and harassment. The Recipient , its contractors , and subcontractors must comply with the provisions of the Fair Employment and Housing Act and the applicable regulations promulgated thereunder. (Gov. Code, §12990, subds. (a)-(f) et seq.;Cal. Code Regs., tit. 2 , § 7285 et seq.) Such regulations are incorporated into this Agreement by reference and made a part hereof as if set forth in full. The Recipient , its contractors , and subcontractors must give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other agreement. The Recipient must include the nondiscrimination and compliance provisions of this clause in all subcontracts to perform work under this Agreement. 27 . NO THIRD-PARTY RIGHTS. This Agreement creates no rights in and grants no remedies to any third party as a beneficiary of this Agreement. 28. NO OBLIGATION OF THE STATE. Any obligation of the State Water Board herein contained shall not be an obligation, debt, or liability of the State and any such obl igation shall be payable solely out of the moneys encumbered pursuant to th is Agreement. 29 . NON-WAIVER. Nothing in th is Agreement shall affect or impair the Recipient's obligation to undertake work under this Agreement or shall affect or impair the right of the State Water Board to bring suit to enforce such work . No delay or omission of the State Water Board in the exercise of any right arising upon an Event of Default shall impair any such right or be construed to be a waiver of any such Event of Default. The State Water Board may exercise from time to time and as often as shall be deemed expedient by the State Water Board, any remedy or right provided by law or pursuant to this Agreement. Any waiver of rights by the State Water Board with respect to a default or other matter arising under this Agreement at any time shall not be considered a waiver of rights with respect to any other default or matter. 30. OTHER FUNDING SOURCES ; INCOME RESTRICTIONS. If funding for Project Costs is made available to the Recipient from sources other than this Agreement, the Recipient must notify the Division . The Recipient may retain such funding up to an amount which equals the Recipient's contribution to Project costs. To the extent allowed by requirements of other funding sources, excess funding must be remitted to the State Water Board . The Recipient agrees that any refunds, rebates, Exhibit C 401 City of Huntington Beach Project No . EDWG-3010053-001 C Agreement No.: D2302094 Page 22 of 37 credits, or other amounts (including any interest thereon) accruing to or received by the Recipient as related to this Agreement must be paid by the Recipient to the State Water Board, to the extent that they are properly allocable to costs for which the Recipient has been reimbursed by the State Water Board under this Agreement. 31 . PERMITS AND AUTHORIZATIONS. Recipient must procure all permits, licenses and other authorizations necessary to accomplish the work contemplated in this Agreement, pay all charges and fees, and give all notices necessary and incidental to the due and lawful prosecution of the work. Signed copies of any such permits or licenses must be submitted to the Division before any construction or implementation begins. Any contractors, outside associates, or consultants required by the Recipient in connection with the services covered by this Agreement shall be limited to such individuals or firms as were specifically identified and agreed to during negotiations for this Agreement, or as are specifically authorized by the State Water Board's Project Manager during the performance of this Agreement. Any substitutions in, or additions to, such contractors, associates, or consultants, shall be subject to the prior written approval of the State Water Board's Project Manager. 32. PREVAILING WAGES. If applicable, the Recipient agrees to be bound by all applicable provisions of State Labor Code regarding prevailing wages. If applicable, the Recipient must monitor all agreements subject to reimbursement from this Agreement to ensure that the applicable prevailing wage provisions of the State Labor Code are being met. Division of Industrial Relations (DIR) requirements may be found at: http://www.dir.ca.gov/lcp.asp. For more information, please refer to DIR's Public Works Manual at: http://www.dir.ca.gov/dlse/PWManualCombined.pdf. 33. PRIOR COSTS. No costs incurred prior to the Eligible Work Start Date are eligible for reimbursement. 34. PROFESSIONALS. The Recipient agrees that only licensed professionals will be used to perform services under this Agreement where such services are called for. All technical reports required pursuant to this Agreement that involve planning , investigation, evaluation, design, or other work requiring interpretation and proper application of engineering, architectural, or geologic sciences, shall be prepared by or under the direction of persons registered to practice in California pursuant to Business and Professions Code, sections 5536.1, 6735, 7835, and 7835.1. As required by these laws, completed technical reports must bear the signature(s) and seal(s) of the registered professional(s) in a manner such that all work can be clearly attributed to the professional responsible for the work. 35. RECORDS, INSPECTION, AUDITS, AND INTERVIEWS; RECORDS RETENTION. The Recipient must maintain separate books, records and other material relative to the Project and retain such books, records, subcontracts, and other material until at least the Records Retention End Date set forth on the Cover Page of this Agreement. The Recipient must require that such books, records, and other material are subject at all reasonable times (at a minimum during normal business hours) to inspection, copying, and audit by the State Water Board, the Department of Finance, the California State Auditor, the Bureau of State Audits, or any authorized representatives of the aforementioned, including federal funding agencies and their auditors, if any. The Recipient must allow and must require its contractors to allow interviews during normal business hours of any employees who might reasonably have information related to such records . The Recipient agrees to include a similar duty regarding audit, interviews, and records retention in any contract or subcontract related to the performance of this Agreement. The provisions of this section survive the term of this Agreement. 36. RELATED LITIGATION. Under no circumstances may the Recipient use funds from any reimbursement under this Agreement to pay costs associated with any litigation the Recipient pursues against the State Water Board or any Regional Water Board. Regardless of the outcome of any such litigation, and notwithstanding any conflicting language in this Agreement, the Recipient Exhibit C 402 City of Huntington Beach Project No. EDWG -3010053-001 C Agreement No .: D2302094 Page 23 of 37 agrees to complete the Project funded by this Agreement or to repay all of the disbursed funds plus interest. 37. REMEDIES . The State Water Board may enforce its rights under this Agreement by any judicial proceeding, whether at law or in equity. None of the remedies available to the State Water Board shall be exclus ive of any other remedy, and each such remedy shall be cumulative and in addition to every other remedy given hereunder or now or hereafter existing at law or in equity. The State Water Board may exercise any remedy, now or hereafter existing , without exhausting and without regard to any other remedy. Any dispute of the Recipient is limited to the rights and remedies provided to the Recipient under this Agreement and is subject to the procedures provided to the Recipient under this Agreement. 38. REPORTS -AS NEEDED. The Recipient must provide expeditiously any reports, data , and information reasonably required by the Division, including but not limited to material necessary or appropriate for evaluation of the funding program or to fulfill any reporting requirements of the State or federal government. 39. RESPONSIBILITY FOR WORK. The Recipient shall be responsible for all work and for persons or entities engaged in work performed pursuant to this Agreement , including, but not limited to , contractors , subcontractors, suppliers , and providers of services . The Recip ient shall be responsible for responding to any and all disputes arising out of its contracts for work on the Project , including , but not limited to, payment disputes with contractors and subcontractors . The State Water Board will not med iate disputes between the Recipient and any other entity concerning responsibility for performance of work. 40. RIGHTS IN DAT A. The Recipient agrees that all data, plans, drawings, specifications , reports , computer programs, operating manuals, notes, and other written or graphic work produced in the performance of this Agreement are subject to the rights of the State as set forth in this section . The State shall have the right to reproduce , publish , and use all such work, or any part thereof, in any manner and for any purposes whatsoever and to authorize others to do so . If any such work is copyrightable , the Recipient may copyright the same , except that , as to any work which is copyrighted by the Recipient, the State reserves a royalty-free , nonexclusive, and irrevocable license to reproduce , publish, and use such work, or any part thereof, and to authorize others to do so , and to receive electronic copies from the Recipient upon request. The Rec ipient may disclose, disseminate and use in whole or in part, any final form data and information received , collected , and developed under this Agreement , subject to appropriate acknowledgement of credit to the State Water Board for financial support . The Rec ipient shall not utilize the materials for any profit-making venture or sell or grant rights to a third party who intends to do so . 41 . STATE WATER BOARD ACTION; COSTS AND ATTORNEY FEES . In the event of litigation between the parties hereto arising from this Agreement, it is agreed that each party shall bear its own costs and attorney fees . 42. STATUS QUO . If any action to enforce any right or exercise any remedy shall be brought and either discontinued or determined adversely to the State Water Board , then the State Water Board shall be restored to its former position, rights , and remedies as if no such action had been brought. 43 . TERMINATION , IMMEDIATE REPAYMENT, AND INTEREST : This Agreement may be terminated by written notice at any time , at the opt ion of the State Water Board , if: a. the Recipient has received funds as a result of a material misrepresentation in the funding application or other submitted document; or b. upon violation by the Recipient of any material provis ion of this Agreement after such violat ion has been called to the attention of the Recipient and after fa ilure of the Recip ient to b ring itself Exhibit C 403 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 24 of 37 into compliance with the provisions of this Agreement within a reasonable time as established by the State Water Board . In the event of such termination, the Recipient agrees, upon demand, to immediately repay to the State Water Board an amount equal to the amount of Project Funds disbursed to the Recipient prior to such termination . In the event of termination, interest shall accrue on all amounts due at the highest legal rate of interest from the date that notice of termination is mailed to the Recipient to the date of full repayment by the Recipient. 44. TIMING. Time is of the essence . The Recipient must expeditiously proceed with and complete the Project. Failure to proceed according to the timelines set forth in this Agreement may require the Recipient to repay to the State Water Board all disbursed Project Funds . 45. TRAVEL AND PER DIEM . No work or travel outside the State of California is permitted under this Agreement unless the Division provides prior written authorization. No work or travel outside the United States of America is authorized . Failure to comply with this restriction may constitute an Event of Default and result in termination of this Agreement. Any reimbursement for necessary travel and per diem shall be set pursuant to and at rates not to exceed those set by the California Department of Human Resources at http ://www.calhr.ca .gov/employees/Paqes/travel-reimbursements.aspx as of the date costs are incurred by the Recipient. 46. UNDISBURSED FUNDS . The Recipient is not entitled to interest earned on undisbursed funds . 47. UNENFORCEABLE PROVISION; SEVERABILITY. In the event that any provis ion of this Agreement is unenforceable or held to be unenforceable, then the parties agree that all other provisions of th is Agreement have force and effect and shall not be affected thereby . 48. UNION ACTIVITIES: The Recipient hereby acknowledges the applicability of Government Code sections 16645 through 16649 to this Agreement. The Recipient certifies that none of the Project Funds will be used to assist , promote, or deter union organizing . If the Recipient incurs costs or makes expenditures to assist, promote, or deter union organizing, the Recipient will maintain records sufficient to show that no reimbursement from Project Funds has been sought for these costs and the Recipient shall provide those records to the Attorney General upon request. 49. VENUE. Any action arising out of this Agreement shall be filed and maintained in the Superior Court in and for the County of Sacramento , California. 50. WAIVER AND RIGHTS OF THE STATE WATER BOARD . Any waiver of rights by the State Water Board with respect to a default or other matter arising under this Agreement at any time shall not be considered a waiver of rights with respect to any other default or matter. 51. WATER CONSERVATION AND EFFICIENCY PROGRAMS : The Recipient acknowledges that it has appropriate water conservation and efficiency programs in place, and that this provision constitutes a condition of this Agreement. A web link with examples of water conservation and efficiency programs is available at: http://www.waterboards.ca.gov/waterriqhts/water issues/programs/drought/conservation.shtml. 52. WATER DIVERSION AND USE : To the extent applicable, the Recipient has complied with, and shall continue to comply with, the requirements of Water Code, division 2, part 5 .1, section 5100 et seq . for filing statements of water diversion and use. 53. WITHHOLDING OF DISBURSEMENTS AND REIMBURSEMENTS. Notwithstand ing any other provis ion of this Agreement, the State Water Board may withhold all or any portion of the Project Funds upon the occurrence of any of the following events : Exhibit C 404 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 25 of 37 a) Failure of the Recipient to maintain reasonable progress on the Project as determined by the Division ; b) Commencement of litigation or a judicial or administrative proceeding related to the Project , or Recipient that the State Water Board determines may impair the timely satisfaction of Recipient's obligations under this Agreement; c) Any investigation by State, local, or federal investigators or auditors, or a grand jury, relating to the Recipient's financial management, accounting procedures, or internal fiscal controls; d) A material adverse change in the condition of the Recipient, or the Project, that the Division reasonably determines would materially impair the Recipient's ability to satisfy its obligations under this Agreement, or any other event that the Division reasonably determines would materially impair the Recipient's ability to satisfy its obligations under this Agreement; e) The Recipient's material violation of, or threat to materially violate, any provision of this Agreement; f) Suspicion of fraud, forgery , embezzlement, theft, or any other misuse of public funds by the Recipient or its employees, or by its contractors or agents directly or indirectly regarding the Project; g) An event requiring notice under this Agreement; or h) An Event of Default or an event that the Division determines may become an Event of Default. Exh ibit C 405 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 26 of 37 EXHIBIT D -SPECIAL CONDITIONS D.1 DEFINITIONS. (a) Notwithstanding Exhibit C, the follow ing terms have no meaning for the purposes of this Agreement: • Work Completion • Work Completion Date. (b) Each capitalized term used in th is Agreement has the following meaning : • "Allowance" means an amount based on a percentage of the accepted bid for an eligible project to help defray the planning, design, and construction engineering and administration costs of the Project. • "Authorized Representative " means the duly appointed representative of the Recipient as set forth in the certified original of the Recipient's authorized representative resolution that designates the authorized representative by title . • "Completion of Construction" means that the work of building and erection of the Project is substantially complete to the reasonable satisfaction of the Div ision. • "District Office" means District Office of the Division of Drinking Water of the State Water Board. • "Division of Drinking Water" means the Division of Drinking Water of the State Water Board. • "Eligible Work Start Date " means the date set forth on the Cover Page of this Agreement, establishing the date on or after which any non-construction costs may be incurred and eligible for reimbursement hereunder. • "Enterprise Fund" means the enterprise fund of the Recipient in which Revenues are deposited. • "Estimated Completion of Construction Date" means the estimated due date for Completion of Construction , as determined by the Division after consultation with the Recipient, and is established on the Cover Page of this Agreement. • "Event of Default" means, in addition to the meanings set forth in Exhibit C, the occurrence of any of the following events: a) A material adverse change in the condition of the Recipient, the Revenues, or the System , which the Division reasonably determines would materially impair the Recipient 's ability to satisfy its obligations under this Agreement. b) Failure to operate the System or the Project, unless the Division has given its approval for such non-operation . c) The occurrence of a material breach or event of default under any Recipient obligation that results in the acceleration of principal or interest or otherwise requires immediate prepayment, repurchase or redemption, or that the Division determines would materially impair the Recipient's ability to satisfy its obligations under this Agreement. d) If the Recipient is a member of a joint powers authority, the occurrence of a material breach or event of default under any agreement to which the joint powers authority is a party, relevant to the System or the Revenues, that the Division determines would materially impair the Recipient's ability to satisfy its obligations under this Agreement. e) Failure to obtain and keep the necessary water rights for the Useful Life of the Project. • "Final Budget Approval (FBA)" means the Division-approved final budget for the Project, or phase of the Project, as set forth in Exhibit B. Exhibit D 406 City of Huntington Beach Project No . EDWG -3010053-001 C Agreement No.: D2302094 Page 27 of 37 • "Indirect Costs" means those costs that are incurred for a common or joint purpose benefiting more than one cost objective and are not readily assignable to the Project (i.e., costs that are not directly related to the Project). Examples of Indirect .Costs include, but are not limited to: central service costs ; general administration of the Recipient; non-project-specific accounting and personnel services performed within the Recipient organization; depreciation or use allowances on buildings and equipment; the costs of operating and maintaining non-project-specific facilities; tuition and conference fees; generic overhead or markup; and taxes. • "Initiation of Construction" means the date that notice to proceed with work is issued for the Project , or, if notice to proceed is not required, the date of commencement of building and erection of the Project. • "Net Revenues" means , for any Fiscal Year, all Revenues received by the Recipient less the Operations and Maintenance Costs for such Fiscal Year. • "Operations and Maintenance Costs" means the reasonable and necessary costs paid or incurred by the Recipient for maintaining and operating the System, determined in accordance with GAAP, including all reasonable expenses of management and repair and all other expenses necessary to maintain and preserve the System in good repair and working order, and including all reasonable and necessary administrative costs of the Recipient that are charged directly or apportioned to the operation of the System, such as salaries and wages of employees, overhead, taxes (if any), the cost of permits, licenses , and charges to operate the System and insurance premiums; but excluding, in all cases depreciation, replacement, and obsolescence charges or reserves therefor and amortization of intangibles. • "Project Completion Date" means the date that the Project shall be complete to the reasonable satisfaction of the Division, and is established on the Cover Page of this Agreement. • "Revenues" means, for each Fiscal Year, all gross income and revenue received or receivable by the Recipient from the ownership or operation of the System, determined in accordance with GAAP , includ ing all rates , fees , and charges (including connection fees and charges) as received by the Recipient for the services of the System, and all other income and revenue howsoever derived by the Recipient from the ownership or operation of the System or arising from the System , including all income from the deposit or investment of any money in the Enterprise Fund or any rate stabilization fund of the Recipient or held on the Recipient's behalf, and any refundable deposits made to establ ish credit , and advances or contributions in aid of construction . • "System" means all drinking water collection , transport, treatment , storage, and delivery facilities, including land and easements thereof, owned by the Recipient, or its successor agency , and all other properties, structures, or works hereafter acquired and constructed by the Recipient and determined to be a part of the System , together with all additions, betterments, extensions , or improvements to such facilities , properties, structures, or works, or any part thereof hereafter acquired and constructed . • "Useful Life" means the economically useful life of the Project beginning at Project Completion, which must be at least 20 years. D.2 ADDITIONAL REPRESENTATIONS AND WARRANTIES . The Recipient represents, warrants, and covenants each of the following : (a) The Recipient has not made any untrue statement of a material fact in its application for this financial assistance or omitted to state in its application a material fact that makes the statements in its application not misleading. Exhibit D 407 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 28 of 37 (b) The Recipient agrees to fulfill all assurances, declarations , representations, and commitments in its application, accompanying documents, and communications filed in support of its request for funding under this Agreement. (c) The execution, delivery, and performance by Recipient of this Agreement, including all incorporated documents, do not violate any provision of any law or regulation in effect as of the date of execution of this Agreement by the Recipient, or result in any breach or default under any contract , obligation, indenture, or other instrument to which Recipient is a party or by which Recipient is bound as of the date of execution of this Agreement by the Recipient. (d) There are, as of the date of execution of this Agreement by the Recipient, no pending or, to Recipient's knowledge, threatened actions, claims, investigations, suits, or proceedings before any governmental authority, court, or administrative agency that materially affect the financial condition or operations of the Recipient, the Revenues, and/or the Project. (e) There are no proceedings, actions, or offers by a public entity to acquire by purchase or the power of eminent domain any of the real or personal property related to or necessary for the Project. (f) The Recipient is duly organ ized and existing and in good standing under the laws of the State of California. Recipient must at all times maintain its current legal existence and preserve and keep in full force and effect its legal rights and authority. Within the preceding ten years, the Recipient has not failed to demonstrate compliance with state or federal audit disallowances . (g) Any financial statements or other financial documentation of Recipient delivered or to be delivered to the State Water Board as of the date(s) set forth in such financial statements or other financial documentation: (a) are or will be materially complete and correct; (b) present fairly the financial condition of the Recipient; and (c) have been or will be prepared in accordance with GAAP. Since the date(s) of any financial statements or other financial documentation previously provided to the State Water Board, there has been no material adverse change in the financial condition of the Recipient, nor have any assets or properties reflected on such financial statements or other financial documentation been sold, transferred, assigned, mortgaged, pledged or encumbered, except as previously disclosed in writing by Recipient and approved in writing by the State Water Board . (h) The Recipient is current in its continuing disclosure obligations associated with its material debt, if any. (i) The Recipient has no conflicting or Material Obligations. U) The Recipient and its principals, contractors, and subcontractors , to the best of the Recipient's knowledge and belief, are not presently debarred , suspended, proposed for debarment, declared inelig ible, or otherwise excluded from participation in any work overseen, directed , funded, or administered by the State Water Board program for which this funding is authorized; nor have they engaged or permitted the performance of services covered by this Agreement from parties that are debarred or suspended or otherwise excluded from or ineligible for participation in any work overseen, directed, funded, or administered by the State Water Board program for which this funding is authorized . The Recipient shall select contractors and subcontractors for this Project that meet the requirements of this paragraph. Exhibit D 408 D.3 ACKNOWLEDGEMENTS. City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 29 of 37 The Recipient must include the following acknowledgement in any document, written report, or brochure to be shared with the general public prepared in whole or in part pursuant to this Agreement: • "Funding for this project has been provided in full or in part under the Budget Act of 2021 through an agreement with the State Water Resources Control Board. The contents of this document do not necessarily reflect the views and policies of the foregoing , nor does mention of trade names or commercial products constitute endorsement or recommendation for use." D.4 RATES, FEES, AND CHARGES . The Rec ipient must, to the extent permitted by law , fix , prescribe and collect rates, fees and charges for the System during each Fiscal Year which are reasonable, fair, and nondiscriminatory and which will be sufficient to generate Revenues in the amounts necessary to cover Operations and Maintenance Costs , and must ensure that Net Revenues are in an amount necessary to meet its obligations under this Agreement. The Recip ient may make adjustments from time to time in such fees and charges and may make such classification thereof as it deems necessary , but shall not reduce the rates, fees and charges then in effect unless the Net Revenues from such reduced rates, fees, and charges will at all times be sufficient to meet the requirements of this section . D.5 PROPERTY RIGHTS AND WATER RIGHTS . (a) Unless otherwise previously disclosed to the Division and described in the legal opinion accompanying this Agreement, the Recipient (1) has sufficient real or personal property and access rights necessary for the purposes of this Agreement, not subject to third party revocation , which rights extend at least to the Records Retention End Date of this Agreement , and (2) possesses all water rights necessary fo r this Project and the continued operation of t he System. (b) If the Recip ient does not have sufficient property, access, or water rights as described in paragraph a , above at the time of execution of this Agreement, then prior to the Division's bid solicitation approval , construction activities , and any reimbursement for construction , the Recipient shall provide evidence satisfactory to the Division that the Recipient has obtained the necessary property rights and water rights , including a legal opin ion satisfactory to the State Water Board's counsel that the Recipient has sufficient property rights in the Project property for the purposes contemplated under this Agreement as well as sufficient water rights for the Project and the continued operation of the System. D.6 CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) COMPLIANCE. The Rec ipient shall comply with all applicable laws and regulations for the Project, including CEQA. No bid solicitation or construction may proceed unless and until the State Water Board completes its own CEQA findings and gives authorization to proceed with such activities . THE STATE WATER BOARD EXPRESSLY WITHHOLDS APPROVAL OF ANY CONSTRUCTION OR CONSTRUCTION-RELATED ELEMENT OF THE PROJECT AND THE RELEASE OF FUNDS ASSOCIATED WITH THAT CONSTRUCTION OR CONSTRUCTION-RELATED ELEMENT OF THE PROJECT UNTIL COMPLETION OF THE CEQA PROCESS , INCLUDING THE STATE WATER BOARD MAKING ITS OWN FINDINGS UNDER CEQA IF APPLICABLE. PROCEEDING WITH THE BID SOLICITATION PROCESS, EQUIPMENT PROCUREMENT, PURCHASE OF LAND OR OTHER PROPERTY RIGHTS, AND/OR CONSTRUCTION PRIOR TO RECEIVING AUTHORIZATION FROM THE DIVISION MAY RENDER THE PROJEC T INELIGIBLE FOR FUNDING AND MAY BE GROUNDS FOR IMMEDIATE TERMINATION OF THE AGREEMENT. Any funds in the prelim inary award notification or this Agreement linked to the construction element of the Project are for encumbrance purposes only and will Exhibit D 409 City of Huntington Beach Project No. EDWG-3010053-001C Agreement No.: D2302094 Page 30 of 37 be reviewed after the State Water Board makes any necessary CEQA findings. The appropriate environmental review under CEQA must be complete before the State Water Board determines whether to approve funding for construction of the Project or for any site acquisition (purchase of land, etc.) associated with the Project. If the Recipient is the CEQA lead agency for the project, when the CEQA review process is complete, the Recipient shall file a CEQA Notice of Determination or Notice of Exemption for the Project at both the applicable County Clerk's office and at the Governor's Office of Planning and Research, State Clearinghouse. D.7 TECHNICAL SPECIAL CONDITIONS. 1. The Recipient shall not solicit bids, award a contract , or commence construction activities until final plans and specifications are approved by the Division 's Project Manager. 2. The Recipient shall provide to the Division copies of executed individual agreements for water seNice, in a form satisfactory to the Division , between the Recipient and each property owner. The Recipient shall not solicit bids, award a contract , or commence construction activities until at least 50% of the executed individual agreements described in the Agreement are submitted and the Division provides approval to proceed. 3. The Recipient must obtain a right-of-entry agreement for each property owner prior to construction on each individual property. The right-of-entry agreement template must be reviewed and approved by the Division's Office of Chief Counsel and the Division . The Recipient must satisfy this condition for an individual property prior to requesting disbursement of construction costs for that property . 4. The Recipient must not solicit bids, award a contract, or commence construction activities unless the Recipient has provided evidence satisfactory to the Division that the Recipient has obtained the necessary property or access rights for the Project sufficient for the purposes contemplated in this Agreement, has provided a legal opinion satisfactory to the Division's counsel , and has received approval from the Division. The legal opinion must be submitted after at least 50% of the executed individual agreements , 50% of the right-of-entry agreements, and all necessary easement(s) are obtained. 5. The Recipient must obtain the necessary long-term easement(s) on Old Pirate Drive prior to commencing construction activities . D.8 ENVIRONMENTAL SPECIAL CONDITIONS. (a) The Recipient shall not purchase land or equipment specific to the Project, solicit bids for construction of the Project , award a construction contract for the Project, or commence construction unless and until environmental review of the construction project is complete , including all of the following. i. The CEQA lead agency must have either (1) completed the appropriate CEQA document (negative declaration, mitigated negative declaration , or environmental impact report, etc .) for the Project and filed a Notice of Determination (NOD) with the appropriate County Clerk and with the Governor's Office of Planning and Research, State Clearinghouse, or (2) determined that the Project is exempt from CEQA, and filed a Notice of Exemption (NOE) with the appropriate County Clerk and with the Governor's Office of Planning and Research, State Clearinghouse. ii. The Recipient must have provided all information requested by the Division to complete the Division's environmental review of the Project. Exhibit D 410 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: 02302094 Page 31 of 37 iii. The State Water Board must have completed its CEQA review and filed either an NOD or an NOE with the Governor's Office of Planning and Research , State Clearinghouse , for the construction of the Project. (b) The Mitigation Monitoring and Reporting Program adopted by the CEQA lead agency for the Project, if any , pursuant to the CEQA, and approved by the Division, is incorporated by reference, and the Recipient shall comply with the conditions and recommendations there in and shall implement all mitigation measures therein . (c) The Recipient shall make no changes in the Project, construction area, or special conditions, without obtaining the appropriate and necessary prior approval(s) from the State Water Board . 0 .9 FINANCIAL SPECIAL CONDITIONS. (a) The Recipient shall provide all information requested by the Division to complete the financial review of the Project prior to the Division providing bid solicitation approval. (b) The Recipient shall not award a construction contract for the Project or commence construction unless and until the Division provides a Final Budget Approval, and the following condition is met. i. If the Division determines that Recipient's water rates are insufficient to cover the operation and maintenance of the Recipient's water system , including the Project, the Recipient must do the following : • Complete a water rate study that is approved by the Division . • Adopt water rates satisfactory to the Division prior to Final Budget Approval and disbursement of construct ion funds. Satisfactory rates must be in effect prior to Complet ion of Construction . If the Project is bid in phases with Division approval, the Recipient must adopt water rates satisfactory to the Division prior to the first Final Budget Approval , and prior to disbursement of any construction funds. • Provide a supplementary opinion of counsel sat isfactory to the Division 's counsel affirming that the water rates were properly adopted . (c) If requested by the Division , the Recipient shall submit documentation that the Recipient has established a separate enterprise fund for water service, which shall be used solely for System Revenues and System expenses. The Division may withhold d isbursements at its discretion until documentation satisfactory to the Division is subm itted . (d) If .requested by the Division, the Recip ient shall submit audited financial reports on an annual basis, by December 31 of each year, until completion of the Project. The Division may withhold disbursements at its discretion until reports satisfactory to the Division are submitted. D.10 SPEC IAL COMPLIANCE CONDITIONS. (a) The Recipient shall not solicit construction bids or conduct any construction activities until the Recipient has requested approval from the Division using the procedures specified by the Division, and the Division has provided approval in writing . (b) The Recipient shall submit the follow ing documents and information to the Project Manager: i. A copy of the Recipient's adopted Conflict of Interest Code, including the designated pos itions required to file a Statement of Economic Interests (Form 700), as well as other documentation, satisfactory to the Division demonstrating the Recipient's compliance with section 11 of Exhibit C of this Agreement. No Project Funds will be disbursed under this Agreemen t unt il the Recipient satisfies this requirement unless specifically authorized by the Div ision . Exhibit D 411 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 32 of 37 ii. Copies of all consultant services contracts related to this Project and documentation demonstrating the Recipient's procurement processes for such contracts . Procurement processes for consultant services contracts (e.g ., professional engineering , environmental , land surveying , project management) shall be based upon demonstrated competence and qualifications and shall ensu re that rates are reasonable and cons istent with state laws regarding contracting for professional services. No Project Funds will be disbu rsed under this Agreement for such contracts unt il the Rec ipient comp li es with this requirement to the satisfaction of the Div ision w ith respect to the requested costs, unless specifically authorized by the Division . iii. Documentation of the policies and/or procedures Recip ient uses when reviewing and approv i ng consultant , contractor, and subcontractor invo ices . Such policies and/or procedures must ensure that (1) consultant , contractor , and/or subcontractor invoices provide sufficient documentation of the work performed ; and (2) the consultant , contractor, and/or subcontractor costs incurred are el igible and are consistent with the respective project scope of work , budget, and actual work completed. No Proj ect Funds will be d isbursed under this Agreement un ti l the Recipient complies w ith this requirement to the satisfaction of the Div ision with respect to the requested costs , unless specifically authorized by the Division . The Div is ion 's review of the documents and information referenced above , or any other documents submitted in relation to this Project , does not relieve the Recipient from respons ib ility for ensuri ng that its procedures comply with all applicab le laws , rules , guidelines , regulations , and requirements. D.11 FUNDS RELATED TO CONTAMINATION . (a) As a condit ion precedent to this Agreement , the Recipient shall (i) notify the Division of any demands , including but not limited to litigation and insurance claims , made by the Recipient against third parties for reimbursement of costs, monetary damages, or other relief, related to dri nking water contamination , including but not limited to contamination by 1,2,3-trichloropropane (1 ,2 ,3-TCP), perfluoroalkyl and polyfluoroalkyl substances (PFAS), or other contaminants (Contamination-Related Demands); (ii) notify the Division of any payments or funds received by the Rec ipient, agreements, settlements , and court or adm inistrative orders that have arisen out of or are related to drinking water contamination or Contamination-Related Demands (Contami nat ion-Related Payments , Agreements , or Orders); and (iii) to the extent requested by the Div is ion or the Division 's counsel , provide information and access to documentation of any Contamination-Related Demands and Contamination-Related Payments, Agreements , or Orders. (b) Afte r execution of this Agreement, the Rec ip ient shall promptly notify the Div is ion of the new occurrence of any Contamination-Related Demands and Contamination -Related Payments , Agreements, or Orders . Upon request , the Recipient shall promptly provide information and access to documents to the extent requested by the Division or the Division's counsel. (c) The Recipient shall not spend or allocate any funds received as a result of Contam ination-Related Demands or Contamination -Related Payments , Agreements , or Orders (Recovered Funds) unless the Recip ient has obtained written consent for the use of such Recovered Funds from the Division . At the discretion of the Division , the Project Funding Amount of this Agreement may be reduced, disbursements may be withheld , and the Agreement may be rescinded , to offset t he amount of any Recovered Funds or any Contamination-Related Payments , Agreements, or Orders . Upon demand by the Div ision , the Recipient shall return Project Funds to offset any Recovered Funds or Contamination-Related Payments , Agreements , or Orders within thirty (30) days or w ithin another t ime period approved by the Division. The Recipient shall ensure that no duplicative re imbursements of costs occur under this Agreement and any past or future Recovered Funds or Contaminat ion- Related Payments , Agreements , or Orders . Noncompliance w ith th is Funds Related to Contamination section shall be an Event of Default. Exhibit D 412 City of Huntington Beach Project No. EDWG-3010053-001C Agreement No.: D2302094 Page 33 of 37 (d) If the Recipient is not regulated by the California Public Utilities Commission (CPUC), the provisions of this paragraph (d) shall apply. If the Division provides written consent, the Recipient may place Recovered Funds into a restricted reserve account to be used for one of the following purposes but only if such purpose is approved by the Division: (1) as co-funding or match funding for the Project, (2) for a capital improvement project other than the Project that addresses the associated drinking water contamination, (3) for Operations and Maintenance Costs related to addressing the associated drinking water contamination, (4) for Operations and Maintenance Costs of the System in general, or (5) for other purposes approved by the Division. To the extent requested by the Division, the Recipient shall provide access to (i) documentation satisfactory to the Division showing the total amount of Recovered Funds deposited into a restricted reserve account prior to the start of construction of the Project and (ii) documentation thereafter of any Recovered Funds that Recipient receives and places into such an account. (e) If the Recipient is regulated by the CPUC, paragraph (d) shall not apply, and the Recipient shall comply with all applicable CPUC rules with respect to the Recovered Funds and shall provide to the Division copies of all notices, applications, and any other documents filed with the CPUC, and any documents issued by the CPUC, within 10 days of submittal or issuance as applicable, with respect to the receipt and use of Recovered Funds and with respect to any proposed transfer of any assets funded by Recovered Funds . D.12 APPOINTMENT OF RECEIVER OR CUSTODIAN. Upon the filing of a suit or other commencement of judicial proceedings to enforce the rights of the State Water Board under this Agreement, the State Water Board may make application for the appointment of a receiver or custodian of the Revenues, pending such proceeding, with such power as the court making such appointment may confer. D .13 RETURN OF FUNDS. Notwithstanding any other provision of this Agreement, if the Division determines that an Event of Default has occurred, the Recipient may be required, upon demand, to immediately return to the State Water Board any grant or principal forgiveness amounts received pursuant to this Agreement and pay interest at the highest legal rate on all of the foregoing. D.14 OPERATION AND MAINTENANCE. The Recipient shall sufficiently and properly staff, operate, and maintain the facility and structures constructed or improved as part of the Project throughout the term of this Agreement, consistent with the . purposes of this Agreement. The Recipient assumes all operations and maintenance costs of the facilities and structures; the State Water Board shall not be liable for any cost of such maintenance, management or operation. D.15 INSURANCE. The Recipient will procure and maintain or cause to be maintained insurance on the System and Project with responsible insurers, or as part of a reasonable system of self-insurance, in such amounts and against such risks (including damage to or destruction of the System/Project) as are usually covered in connection with systems similar to the System/Project. Such insurance may be maintained by a self- insurance plan so long as such plan provides for (i) the establishment by the Recipient of a separate segregated self-insurance fund in an amount determined (initially and on at least an annual basis) by an Exhibit D 413 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 34 of 37 independent insurance consultant experienced in the field of risk management employing accepted actuarial techniques and (ii) the establishment and maintenance of a claims processing and risk management program. In the event of any damage to or destruction of the System/Project caused by the perils covered by such insurance, the net proceeds thereof shall be applied to the reconstruction, repair or replacement of the damaged or destroyed portion of the System/Project. The Recipient must begin such reconstruction, repair or replacement as expeditiously as possible, and must pay out of such net proceeds all costs and expenses in connection with such reconstruction, repair or replacement so that the same must be completed and the System and Project must be free and clear of all claims and liens. Recipient agrees that for any policy of insurance concerning or covering the construction of the Project, it will cause, and will require its contractors and subcontractors to cause, a certificate of insurance to be issued showing the State Water Board, its officers, agents, employees, and servants as additional insured; and must provide the Division with a copy of all such certificates prior to the commencement of construction of the Project. D.16 CONTINUOUS USE OF PROJECT; NO LEASE, SALE, TRANSFER OF OWNERSHIP, OR DISPOSAL OF PROJECT. The Recipient agrees that, except as provided in this Agreement, it will not abandon, substantially discontinue use of, lease, sell, transfer ownership of, or dispose of all or a significant part or portion of the Project during the Useful Life of the Project without prior written approval of the Division. Such approval may be conditioned as determined to be appropriate by the Division, including a condition requiring repayment of all disbursed Project Funds or all or any portion of all remaining funds covered by this Agreement together with accrued interest and any penalty assessments that may be due. D.17 NOTICE. Upon the occurrence of any of the following events, the Recipient must notify the Division's Deputy Director and Party Contacts by phone and email within the time specified below: (a) Within 24 hours, the Recipient must notify the Project Manager by phone and by email and the Division by phone at (916) 327-9978 and by email, DrinkWaterSRF@waterboards .ca.gov, of any discovery of any potential tribal cultural resource, archaeological or historical resource, or human remains in the Project area. If there are any applicable provisions of a mitigation, monitoring and reporting program adopted for the project, the Recipient shall comply with such provisions. The Recipient must coordinate with the Division to determine the appropriate course of action necessary to mitigate potential impacts . In the event of the discovery of human remains during construction of the Project, the Recipient shall cease construction and take other action required by any applicable laws, which may include but are not limited to Health and Safety Code, section 7050.5 and Public Resources Code, section 5097.98. (b) The Recipient must notify the Division and Party Contacts promptly of the occurrence of any of the following events: i. Bankruptcy, insolvency, receivership or similar event of the Recipient, or actions taken in anticipation of any of the foregoing; ii. Change of ownership of the Project (no change of ownership may occur without written consent of the Division); iii. Loss, theft, damage, or impairment to Project; Exhibit D 414 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 35 of 37 iv. Events of Default, except as otherwise set forth in this section; v. A proceeding or action by a public entity to acquire the Project by power of eminent domain. vi. Any litigation pending or threatened with respect to the Project or the Recipient's technical , managerial or financial capacity or the Recipient's continued existence, or any judgment or court order relating to such litigation that has a significant effect on the Project or the System; vii. Consideration of dissolution, or disincorporation; viii. Enforcement actions by or brought on behalf of the State Water Board or Regional Water Board. ix. The discovery of a false statement of fact or representation made in this Agreement or in the application to the Division for this funding, or in any certification, report, or request for reimbursement made pursuant to this Agreement, by the Recipient , its employees, agents, or contractors; x. Any substantial change in scope of the Project. The Recipient must undertake no substantial change in the scope of the Project until prompt written notice of the proposed change has been provided to the Division and the Division has given written approval for the change; xi. Any circumstance, combination of circumstances, or condition, which is expected to or does delay Completion of Construction for a period of ninety (90) days or more ; xii. Cessation of all major construction work on the Project where such cessation of work is expected to or does extend for a period of thirty (30) days or more; xiii. The Recipient must promptly notify the Division and Party Contacts of the discovery of any unexpected endangered or threatened species , as defined in the federal Endangered Species Act. Should a federally protected species be unexpectedly encountered during implementation of the Project, the Recipient agrees to promptly notify the Division. This notification is in addition to the Recipient's obligations under the federal Endangered Species Act. xiv. Any Project monitoring, demonstration, or other implementation activities required in this Agreement; xv. Any public or media event publicizing the accomplishments and/or results of this Agreement and provide the opportunity for attendance and participation by state representatives with at least ten (10) working days' notice to the Division; xvi. Any event requiring notice to the Division pursuant to any other provision of this Agreement; xvii. The award of the prime construction contract for the Project; and the initiation of construction of the Project ; and xviii. Completion of Construction, and Project Completion. D.18 FRAUD , WASTE , AND ABUSE. The Recipient shall prevent fraud, waste, and the abuse of Project Funds, and shall cooperate in any investigation of such activities that are suspected in connection with this Agreement. The Recipient understands that discovery of any evidence of misrepresentation or fraud related to Reimbursement Exhibit D 415 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 36 of 37 Requests, invoices, proof of payment of invoices, or other supporting information , including but not limited to double or multiple billing for time , services , or any other eligible cost, may result in an administrative action by the State Water Board and/or referral to the Attorney General's Office or the applicable District Attorney's Office for appropriate action . The Rec ipient further understands that any suspected occurrences of false claims , misrepresentation, fraud, forgery, theft or any other misuse of Project Funds may result in withholding of reimbursements and/or the termination of this Agreement requiring the immediate repayment of all funds disbursed hereunder. A person who knowingly makes or causes to be made any false statement, material misrepresentation , or false certification in any submittal may be subject to a civil penalty , criminal fine, or imprisonment. (Wat. Code,§ 13490 et seq.) D.19 DISPUTES. The Recipient must continue with the responsibilities under this Agreement during any dispute. The Recipient may, in writing, appeal a staff decision within 30 days to the Deputy Director of the Division or designee, for a final Division decision . The Recipient may appeal a final Division decision to the State Water Board within 30 days. The Office of the Chief Counsel of the State Water Board will prepare a summary of the dispute and make recommendations relative to its final resolution, which will be provided to the State Water Board's Executive Director and each State Water Board Member. Upon the motion of any State Water Board Member, the State Water Board will review and resolve the dispute in the manner determined by the State Water Board . Should the State Water Board determine not to review the final Divis ion decision , this decision will represent a final agency action on the dispute. This provision does not preclude consideration of legal questions , provided that nothing herein shall be construed to make final the decision of the State Water Board , or any official or representative thereof, on any question of law. This section relating to disputes does not establish an exclusive procedure for resolving claims within the meaning of Government Code sections 930 and 930.4. D.20 EXECUTIVE ORDER N-6-22 -RUSSIAN SANCTIONS. On March 4, 2022 , Governor Gavin Newsom issued Executive Order N-6-22 (the EO) regarding Economic Sanctions against Russia and Russian entities and individuals. "Economic Sanctions" refers to sanctions imposed by the U.S. government in response to Russia's actions in Ukraine, as well as any sanctions imposed under state law. The EO directs state agencies to terminate contracts with, and to refrain from entering any new contracts with , individuals or entities that are determined to be a target of Economic Sanctions . Accordingly, should the State Water Board determine Recipient is a target of Economic Sanctions or is conducting prohibited transactions with sanctioned individuals or entities , that shall be grounds for termination of this Agreement. The State Water Board shall provide Recipient advance written notice of such termination, allowing Recipient at least 30 calendar days to provide a written response. Termination shall be at the sole discretion of the State Water Board. The Recipient represents that the Recipient is not a target of economic sanctions imposed in response to Russia 's actions in Ukraine imposed by the United States government or the State of California. The Recipient is required to comply with the economic sanctions imposed in response to Russia 's actions in Ukraine, including with respect to, but not limited to , the federal executive orders identified in California Executive Order N-6-22, located at https ://www.gov.ca.gov/wp-contenUuploads/2022/03/3.4 .22-Russia- Ukraine-Executive-Order.pdf and the sanctions identified on the United States Department of the Treasury website (https ://home.treasury.gov/policy-issues/financial-sanct ions/sanct ions-programs-and- country-information/ukraine-russia-related-sanctions). The Recipient is required to comply with all applicable reporting requirements regarding compliance with the economic sanctions, including, but not limited to, those reporting requirements set forth in California Executive Order N-6-22 for all Recipients with one or more agreements with the State of California with an aggregated value of Five Million Dollars ($5,000,000) or more. Notwithstanding any other provision in this Agreement, failure to comply with the economic sanctions and all applicable reporting requirements may result in termination of this Agreement. Exhibit D 416 City of Huntington Beach Project No. EDWG-3010053-001 C Agreement No.: D2302094 Page 37 of 37 For Recipients with an aggregated agreement value of Five Million Dollars ($5,000 ,000) or more with the State of California , reporting requirements include , but are not limited to, information related to steps taken in response to Russia 's actions in Ukraine , including but not limited to: 1. Desisting from making any new investments or engaging in financial transact ions with Russian institutions or companies that are headquartered or have their princ ipal place of business in Russia; 2. Not transferring technology to Russia or companies that are headquartered or have their principal place of business in Russia ; and 3. Direct support to the government and people of Ukraine. D.21 STATE CROSS-CUTTERS . Recipient represents that, as applicable , it compl ies and covenants to maintain compliance with the following with respect to all Project Costs for the te rm of this Agreement: • The California Environmental Quality Act (CEQA), as set forth in Public Resources Code 21000 et seq . and in the CEQA Guidelines at Title 14 , Division 6 , Chapter 3, Section 15000 et seq. • Water Conservation requirements , inc luding regulations in Division 3 of Title 23 of the Californ ia Code of Regulations. • Monthly Water Diversion Reporting requirements , including requirements set forth in Water Code section 5103. • Public Works Contractor Reg istration with Department of Industrial Relations requirements, including requirements set forth in Sections 1725.5 and 1771 .1 of the Labor Code . • Volumetric Pricing & Water Meters requirements , including the requirements of Water Code sections 526 and 527 . • Urban Water Management Plan requirements, including the Urban Water Management Planning Act (Water Code, § 10610 et seq.). • Urban Wate r Demand Management requirements, including the requirements of Section 10608.56 of the Water Code. • Delta Plan Consistency Findings requ irements, including the requ irements of Water Code section 85225 and California Code of Regulations , title 23, section 5002 . • Agricultural Water Management Plan Consistency requ irements , including the requirements of Water Code section 10852. • Charter City Project Labor Requirements , including the requirements of Labor Code section 1782 and Public Contract Code section 2503. • The Rec ipient agrees that it w ill , at all times , comply with and require its contractors and subcontractors to comply with directives or orders issued pursuant to D ivision 7 of the Water Code. • Regulations in Division 4 of Title 22 of the California Code of Regulations . including but not limited to Californ ia Waterworks Standards in Chapter 16, and Lead and Copper regulations in Chapter 17.5. Exhibit D 417 RESOLUTION NO. 2021-16 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HUNTINGTON BEACH APPROVING THE APPLICATION FOR DRINKING WATER STATE REVOLVING GRANT FUNDS FROM THE CALIFORNIA WATER RESOURCES CONTROL BOARD WHEREAS, the Legislature and Governor of the State of California have provided funds for the program shown above; and The California Water Resources Control Board has been delegated, in part, the responsibility for the administration of this grant program, establishing necessary procedures; and Said procedures established by the Water Resources Control Board require a resolution ce1iifying the approval of application(s) by the Applicant's governing board before submission of said application( s) to the State; and The Applicant, if selected, will enter into an agreement with the State of California to carry out the project. NOW, THEREFORE, BE IT RESOLVE D that the City of Huntington Beach: 1. Approves the filing of an application for Drinking Water State Revolving Grant Funds for a City of Huntington Beach water system improvement Project; and 2. Ce1iifies that Applicant understands the assurances and certification in the application; and 3. If applicable, ce1iifies that the project will comply with any laws and regulations including, but not limited to , the California Environmental Quality Act (CEQA), legal requirements for building codes, health and safety codes, and disabled access laws, and that prior to commencement of construction all applicable permits will have been obtained; and 4. Appoints the City Manager or designee, as agent to conduct all negotiations, execute and submit all documents including, but not limited to, applications, agreements, payment requests and so on, which may be necessary for the completion of the aforementioned project(s). 21-9374/245718 418 Resolution No. 2021-16 PASSED AND ADOPTED by the City Council of the City of Huntington Beach at a regular meeting thereof held on the 1st day of March , 2021. Mayor REVIEWED AND APPROVED : City Manager APPROVED AS TO FORM: 21 -93 74/2457 18 2 419 Res. No. 2021 -16 STATE OF CALIFORNIA COUNTY OF ORANGE ) ss: CITY OF HUNTINGTON BEACH ) I, ROBIN ESTANISLAU , the duly elected , qualified City Clerk of the City of Huntington Beach, and ex-officio Clerk of the City Council of said City, do hereby certify that the whole number of members of the City Council of the City of Huntington Beach is seven; that the foregoing resolution was passed and adopted by the affirmative vote of at least a majority of all the members of said City Council at a Regular meeting thereof held on March 1, 2021 by the following vote: AYES: Peterson, Kalmick, Ortiz, Ca rr , Posey, Moser, Delgleize NOES: None ABSENT: None RECUSE: None City Clerk and ex-officio Clerk of the City Council of the City of Huntington Beach, California 420 CITY OF HUNTINGTON BEACH 2000 MAIN STREET, HUNTINGTON BEACH, CALIFORNIA 92648-2702 OFFICE OF CITY MANAGER OLIVER CH I March 18, 2021 RE: Old Pirate Lane State Small Water System DWSRF Grant In accordance with Resolution 2021-16 passed by the City Council of the City of Huntington Beach, this letter designates the position of Director of Public Works as the appointed authorized agent to conduct all negotiations, execute and submit all documents including, but not limited to, applications, agreements, payment requests and so on, which may be necessary for the completion of the Old Pirate Lane State Small Water System Consolidation project and associated application for Drinking Water State Revolving Fund Grant funding. If you have any questions feel free to call myself (714) 536-5202, or Keegan Olds (714) 375-5118. Sincerely, ()Le~ Oliver Chi City Manager City of Huntington Beach Fax 71 4.536.5233 O ffi ce : 714.536.55 7 5 Gr a h a m S t r e e t OLD PIRATE DRIVE WATER MAIN EXTENSION PROJECT New 8-inch water Main Extension Existing 8-inch water Main Extension 421 - --------• Old Pirate Lane State Small System Consolidation Project, CC-1624 January 21, 2025 Council Meeting 422 PROJECT OVERVIEW •Old Pirate Lane Water Company (OPLWC) installed a private water well in 1950’s for residences in the tract. •Residents shared ownership and maintenance of private water well without a formal Homeowner’s Association. •In January 2020, the Orange County Health Care Authority identified unsafe nitrate levels in the water well. •Nitrate levels exceeded standards set by US Environmental Protection Agency (USEPA) and State Water Resources Control Board, Division of Drinking Water (DDW). •DDW mandated residents to either treat well or connect to the City public water system. •City constructed temporary water connection to 13 residences and applied for grant funding. •This project provides a permanent solution for safe drinking water that complies with DDW and City requirements. OPLWC Private Well 423 PROJECT OBJECTIVE •Construct 260 linear feet of 8-inch potable water pipeline. •Extend the waterline to Doverton Drive for improved quality and redundancy. •Install individual service lines and meters to each residence. •Abandon (Inactive) OPLWC private well per Orange County Health Care Association regulations. •Record easements for new water main for public ownership. 424 D Old Pirate Lane Water Company (OPLWC) - 16671 Served 13 Residences 5401 5415 5431 5441 5451 -Proposed 8-inch Waterline 5391 16701 Extension +-' QJ -Existing City Waterline QJ 16705 La Doverton Dr +-' • OPLWC Private Well -To Cl) Be Abandoned E 5432 ro 5362 5372 5404 5402 5412 5442 5452 16707 ..c ro La l9 _J FINANCIAL IMPACTS •Total Project Cost: $578,000 ▪Grant funding (SWRCB): $327,947 ▪City funding: $250,053 ▪Significant amount of work carried out by City Forces. •Grant Overview: ▪Expedited Drinking Water Grant (EDWG) prioritizes funding for disadvantaged communities and high-priority small communities. ▪Awarded $327,947 in July 2024 to address critical drinking water needs for Old Pirate Lane community. •Grant Purpose: ▪Ensures access to safe, clean, and affordable drinking water. ▪Improves water quality and system reliability for 13 households. ▪Reduces financial burden through grant funding. 425 RECOMMENDED ACTION •Approve and accept the Expedited Drinking Water Grant Program funding of $327,947. •Approve appropriation of $250,053 for on-call engineering services, project management, and easement acquisition. 426 Questions? 427 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:24-916 MEETING DATE:1/21/2025 REQUEST FOR CITY COUNCIL ACTION SUBMITTED TO:Honorable Mayor and City Council Members SUBMITTED BY:Travis Hopkins, Acting City Manager PREPARED BY:Jane Chung, Assistant to the City Manager Subject: FY 2023-2027 Strategic Plan - Biannual Progress Update #3 Statement of Issue: Following City Council's adoption of the FY 2023-27 Strategic Plan on October 3, 2023, staff committed to providing biannual progress updates to the City Council in January and July. Progress updates ensure transparency and accountability towards the timely completion of the Strategic Plan, while giving City Council regular opportunities to review and recommend amendments, as needed. This report provides the third progress update. Financial Impact: Not applicable Recommended Action: Receive and file the FY 2023-2027 Strategic Plan - Biannual Progress Update #3. Alternative Action(s): Do not approve the recommended action and direct staff accordingly. Analysis: From April to June 2023, the City Council and Executive Leadership Team underwent a comprehensive process to develop the FY 2023-2027 Strategic Plan (Plan). This process involved individual interviews with Council Members and Charter Officers, as well as workshops with the City Council and Department Heads to determine key priorities and projects for the next four fiscal years. The City Council adopted the Plan on October 3, 2023, through Resolution 2023-46. The Strategic Plan includes eight overarching goals to be achieved through 23 major strategies and 98 tasks. Staff also identified over 70 key performance indicators (KPIs) to measure the Plan's impact over time. Staff has determined that the Plan is on track and successfully achieving its goals within the anticipated timeline. As of January 2025, the Plan is 53% complete, representing a 21% increase from the Second Biannual Progress Update in July 2024. Moreover, an additional 29% of the Plan is City of Huntington Beach Printed on 1/16/2025Page 1 of 2 powered by Legistar™ 428 File #:24-916 MEETING DATE:1/21/2025 currently in progress, with 10% upcoming, and 7% on hold. To note, there has been an increase in on -hold tasks. This is due to staff identifying and implementing alternative cost-saving approaches to achieve the same objectives. These new strategies are expected to optimize resource utilization while maintaining the desired outcomes. Following the second progress update, Staff has developed a public-facing data dashboard, now available on the City’s website. This dashboard details key performance indicators (KPIs) outlined in the Implementation Action Plan (Attachment 1). To note, the data is presented in calendar quarters, and some KPIs may have less available due to the limitations of the data sources. The updated Implementation Action Plan provides detailed information, and a high-level summary is included in Attachment 2. Following tonight's meeting, all approved documents will be posted on the City's website at www.huntingtonbeachca.gov/strategicplan. Environmental Status: This action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Strategic Plan Goal: Non Applicable - Administrative Item For details, visit www.huntingtonbeachca.gov/strategicplan. Attachment(s): 1. Biannual Program Update #3 (Implementation Action Plan) 2. Summary Presentation City of Huntington Beach Printed on 1/16/2025Page 2 of 2 powered by Legistar™ 429 Each Goal in the IAP includes the following details to guide staff towards the orderly implementation and completion of all items in the Plan. However, the Plan and IAP are living documents that can be amended by the City Council to better meet the needs of the City, as priorities, resources, and conditions evolve over time. 6. Timeline (Start/Finish) A start and end date for the entire task/strategy, defined in quarters and years. Implementation Action Plan for the 2023-2027 Strategic Plan Progress Update #1 (January 2024) The Implementation Action Plan (IAP) is used by City staff to implement the 2023-2027 Strategic Plan goals, given various considerations such as resource availability (i.e., staffing, finances, and equipment). It is also used to track the progress of the Plan for greater transparency and community engagement. Elements of the plan City Council also reviewed 18 other strategies and identified them as important but not as urgent or critical. Those Strategies or “Small Rocks” are available on the original IAP published here . As priority Strategies are completed and free up City resources, City Council may consider working with staff to pick up one or more Small Rocks for future implementation, as higher priority strategies are completed, resources are made available, community needs evolve, and other factors present at that time. 1. Goals Overarching priorities identified by City Council during the Strategic Plan period. 2. Success Indicator The overall impact that is measured upon the completion of a Goal. 3. Strategies The 23 actions or “what we seek to achieve” under each Goal. 4. Key Tasks and Deliverables All Tasks that must be completed to achieve each Goal. 5. Progress Status and Completion % Indicates whether a Task is complete, in progress, upcoming or on hold, and the percentage completion rate. 7. Current Status The status of each task at the time of reporting. 8. Key Performance Indicator Quantitative measures of each task/goal's impact. 10. Estimated Total Project Cost Estimated funds for equipment, services, contractors, consultants, and other necessary expenses. Indicate whether all or partial funds are budgeted or require budgeting 9. Lead Department and Staff The main staff/department designated as having management responsibility for completing the item.All modifications to the IAP and progress updates will continue to be communicated to the City Council on a biannual basis (January and July), providing a forum to gather feedback that will be used to update and improve the Strategic Plan over the next four years.430 If the big rocks don·t go in first, Birg Roc:k5 Wi ghest priority s,trat:egie-s 5ma.111 lk1Cks Import a n t or u~nit ~trateg1ie-~ Sand Non-urgent strategies they aren't going to fit in later. GOAL 1. ECONOMIC DEVELOPMENT Success Indicator: Greater business retention, investments and job growth in Huntington Beach. Start Date Due Date 1) Review 2017 Economic Development Strategy and 2020 Industry Cluster/ Workforce Analysis; conduct the Mayor’s Economic Development Summit on Oct. 13, 2023 to prepare scope of work for an updated Strategy. ◉ Completed 100% Q4/2023 Q4/2023 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 2) Staff to develop a scope of work to prepare an updated Economic Development Strategy.◉ Completed 100% Q4/2023 Q4/2023 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 3) Work with key industry stakeholders to solicit input during the development of the Strategy and prioritize further outreach as part of the strategy.◉ Completed 100% Q4/2023 Q4/2023 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 4) Present an updated Strategy to City Council for consideration and approval.◉ Completed 100% Q4/2023 Q4/2024 Staff presented the updated strategy to the Economic Development Committee in Q2/2024 and to the City Council in Q4/2024. $0 Costs are mainly in staff time Est. Total Project CostStrategiesProgress Status A. Develop an updated economic development strategy to increase business retention, local investments, and job growth Department Point of ContactTimelineCurrent Status Steve Holtz, Community Development Kriss Casanova, Community Development a) # of new business licenses b) # of business visits (new) c) # of businesses assisted by the Economic Development Team (new) d) # of touches with brokers, property owners, and existing or prospective businesses (new) Completion % (est.) Key Tasks and Deliverables (in chronological order)Key Performance Indicators (KPIs) Community Development - Economic Development Manager Lead Dept & Staff 431 Success Indicator: Available funding to support a high-quality level of programs, services, and capital investments and to build a structural surplus. Start Date Due Date 1) Update fee study (i.e., citywide fees and charges, EMS, and fines) and evaluate the feasibility of implementing updated fees. Includes cost of service fee study and cost allocation plan. ◉ Completed 100% Q3/2023 Q2/2024 Task(s) completed as of the second biannual progress report. a) Structurally balanced budget (yes) b) Updated Master Fee Schedule (yes) Finance - Chief Financial Officer $87,700 One-time cost in FY23-24 2) Establish an ongoing program to increase grant application efforts and pursue federal/state funding.↗ In Progress 50%Q3/2023 Q1/2025 An interdepartmental working group is enhancing citywide efforts to identify and apply for funding for major City Council approved projects. This grants working group logs all grant activity. a) Total valuation of grants/outside funds awarded to the City b) # of grants applied (new) c) # of grants by category/sector (new) Shannon Levin, City Manager's Office City Manager's Office - Council Policy Analyst $180,000 / year Budgeted in FY23-24. Will be an ongoing expense. Also covers the cost for Goal 5.A.1-2 3) Evaluate leases/concessionaires and adjust to market rate where applicable ↗ In Progress 25%Q1/2024 Q1/2025 Staff is currently in the process of establishing a centralized real estate program. Issued a RFP for a lease consultant to evaluate and audit city-owned leased assets. KPIs to be determined following the creation of the Real Estate Program Bill Krill, Community Development Community Development - Real Estate & Property Manager TBD 4) Develop formal policy for attracting and retaining high demand businesses ◉ Completed 100%Q4/2023 Q3/2024 This item was incorporated into the updated Economic Development Strategy (Goal 1.A). See Goal 1.A Community Development - Econ. Dev. Manager $0 Costs are mainly in staff time 5) Update developer impact fees in accordance with the Mitigation Fee Act; ensure fees are aligned with the impact of development on City services/stakeholders. ∆ On Hold 0%N/A N/A Staff will revisit this item in 2030 per State law.Jennifer Villasenor, Community Development Community Development - Director On hold A. Consider new revenue sources and opportunities to support the City’s priority initiatives and projects GOAL 2. FISCAL STABILITY Est. Total Project CostCompletion % (est.) Key Tasks and Deliverables (in chronological order)Lead Dept & StaffKey Performance Indicators (KPIs)Strategies Progress Status Current StatusTimeline Department Point of Contact 432 Success Indicator: An engaged City workforce that is committed to responsive and exceptional public service for all and achieves a customer satisfaction rating of 90% or higher. Start Date Due Date 1) Finalize scope of effort (i.e., required departments, services, technology) and physical scope of work (i.e., counter layout, number of workstations, etc.); obtain quotes for tech needs. ↗ In Progress 95%Q2/2023 Q2/2025 $0 Costs are mainly in staff time 2) Procure design firm to prepare concept drawings and cost estimates for physical space ∆ On Hold N/A N/A N/A On hold 3) Circle back with City Council to prioritize next steps, phasing plan, and financing plan ∆ On Hold N/A N/A N/A On hold 4) Implement phasing plan ∆ On Hold N/A N/A N/A On hold 1) Complete recruitment for vacant director positions within 3 months of vacancy ◉ Completed 100% Q1/2023 Q2/2024 Recruitment for all vacant director positions was completed in Q2/2024. Interim CFO started in Q3/2024 a) Recruitments complete (yes) Marissa Sur, Human Resources Human Resources - Director $25,000 One-time cost in FY23-24 2) Implement Managed Hiring Process to identify and fill key vacancies ↗ In Progress 50%Q3/2023 Q2/2025 The Managed Hiring process is on track to meet its 2-year savings goals through Q2/2025.a) Savings on track for FY23-24 and FY24-25 (yes)$0 Costs are mainly in staff time 3) Identify efficiencies to aid departments whose vacancies cannot be filled immediately ↗ In Progress 50%Q2/2023 Q2/2026 Staff identified efficiencies for FY24-25 and will continue to do so for FY 25-26. $0 Costs are mainly in staff time 1) Review and implement a 12-month action plan by North Star ↗ In Progress 50%Q2/2023 Q2/2025 Staff is exploring customer satisfaction surveys to assess the quality of service and interactions.a) No longer applicable $30,000 One-time cost in FY23-24 2) Kickoff a 10-session Dennis Snow Customer Service Virtual Training for 250 team members ◉ Completed 100% Q2/2023 Q4/2023 Task(s) completed as of the first biannual progress report. $6,500 One-time cost in FY23-24 budget 3) Create an internal customer service working group to identify customer issues and develop improvements ↗ In Progress 20%Q1/2024 Q2/2025 Staff is engaging with various technology providers to explore potential products and determine costs. $0 Costs are mainly in staff time 1) Convene a Council Ad Hoc Subcommittee to recommend structural changes as needed ◉ Completed 100% Q2/2023 Q3/2023 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 2) Present recommendations to City Council and implement approved changes ◉ Completed 100% Q2/2023 Q3/2023 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 1) Identify required and optional training opportunities ◉ Completed 100% Q2/2023 Q3/2023 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 2) Research available LMS providers, compare features, pricing and user reviews ◉ Completed 100% Q2/2023 Q1/2024 Staff has implemented the LMS, Target Solutions, as a no-cost training solution for staff. $0 Costs are mainly in staff time 3) Work with selected provider and IS to develop and implement LMS ◉ Completed 100% Q2/2024 Q4/2023 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 4) Conduct citywide training and rollout ◉ Completed 100% Q3/2024 Q2/2024 Staff continues to explore and expand the range of training topics offered to city employees. $0 Costs are mainly in staff time 1) Research performance evaluation system; select and develop new system ↗ In Progress 80%Q2/2022 Q2/2025 Staff will be meeting with Labor Associations to present changes to the city evaluation template. $0 Costs are mainly in staff time 2) Gather feedback and consensus from Leadership Teams, Managers and Labor Associations ↗ In Progress 50%Q1/2023 Q2/2025 Pending discussions with Labor Associations $0 Costs are mainly in staff time 3) Conduct rollout; provide citywide training for all supervisors and staff ⌂ Upcoming 0% Q2/2025 Q4/2025 Citywide rollout plan by department to be initiated; hands-on training for all supervisors and staff to be scheduled. $0 Costs are mainly in staff time 1) Issue an RFP and select a new TPA; coordinate the transfer of all relevant data to TPA ◉ Completed 100% Q4/2022 Q4/2023 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 2) Introduce TPA to organization and rollout TPA services on an ongoing basis ◉ Completed 100% Q3/2023 Q4/2023 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time Human Resources - Director Finance - Chief Financial Officer C. Implement the Public Service Excellence Initiative to invest in workforce development and promote exceptional customer service D. Restructure the City’s Boards, Commissions and Committees (BCC) to ensure the most efficient use of City resources while maintaining an effective level of civic engagement Human Resources - Director Human Resources - DirectorMarissa Sur, Human Resources Veronica Navarro-Martinez, Human Resources F. Launch TrakStar, a web-based performance evaluation system for City employees that will help improve employee engagement and productivity G. Select a new third-party administrator (TPA) for workers’ compensation to manage City claims efficiently, reduce cost and create a safer workplace Jasmine Daley, Community Development Jennifer Villasenor, Community Development In Q3/2023, staff launched Streamline Surf City, a citywide initiative to enhance the development and permitting process. This program encompasses 28 measures and initiatives designed to improve various aspects of development and permitting, offering a cost-effective alternative to physical spaces. In Q3 2024, Staff presented to the City Council an update on Streamline Surf City, including the initial reporting results from the Streamline Specialist program; 15 of the 28 initiatives completed, 7 in progress, and 6 upcoming. a) # of inspections performed b) # of permit applications processed c) # of permits issued d) # of plan checks completed e) # of certificate of occupancy issued f) Accela customer satisfaction survey rating a) % of staff trained in the new evaluation system b) % of usage of the new evaluation system B. Fill department director vacancies and other key positions to lead and provide essential services to the community E. Explore new Learning Management Systems (LMS) to offer more comprehensive and innovative employee and public official training programs Marissa Sur, Human Resources Veronica Navarro-Martinez, Human Resources a) BCCs restructured (yes) a) # of employee training programs offered b) # of attendees per training program A. Establish a One Stop Shop to bring development services and other frequently used services under one location to create an improved and efficient customer service experience GOAL 3. HIGH PERFORMING ORGANIZATION Strategies Lead Dept & Staff Est. Total Project Cost Key Tasks and Deliverables (in chronological order)Department Point of ContactProgress Status Current Status Community Development - Director and Building Official TimelineCompletion % (est.)Key Performance Indicators (KPIs) City Manager’s Office - Assistant to the City Manager City Manager’s Office - Assistant to the City Manager Serena Bubenheim, Finance Jane Chung, City Manager's Office 433 Success Indicator : A continuum of care that reduces homelessness andmaintains quality of life for the entire community. Start Date Due Date 1) Develop the HB Cares model of volunteers to provide services to the homeless population ◉ Completed 100% Q1/2023 Ongoing Task(s) completed as of the first biannual progress report. a) % of volunteers enrolled and trained (maximum 25) (new) b) # of volunteer hours Virginia Clara, City Manager's Office $0 Costs are mainly in staff time 2) Seek partnerships with faith and community-based organizations to provide direct services and support to prevent or reduce homelessness ◉ Completed 100%Q1/2023 Ongoing Task(s) completed as of the first biannual progress report. a) # of local faith and community-based organizations partnering with the City d) # of Be Well referrals/clients (new) e) # of Be Well Services rendered (new) $0 Costs are mainly in staff time 3) Collaborate with CalOptima as they release their street medicine program ◉ Completed 100% Q2/2023 Ongoing Staff will reapply for the CalOptima Street Medicine Program in Q1/2025. $0 Costs are mainly in staff time 1) Coordinate with Jamboree to develop and finalize the planned use and conceptual plans ↗ In Progress 60%Q3/2023 Q3/2027 City Council approved the extension to the existing Exclusive Negotiating Agreement on Q2/2024, $0 Costs are mainly in staff time 2) Secure funding opportunities to develop site ↗ In Progress 25%Q1/2023 Q3/2027 Jamboree Housing has identified multiple funding sources. In Q2/2024, the Huntington Beach Housing Authority authorized the Executive Director to approve Jamboree Housing’s submission of funding applications. Huntington Beach Housing Authority approval will be sought for the acceptance of any awarded funds. $0 Costs are mainly in staff time 3) Collaborate with partners, operators, and agencies to deliver services ↗ In Progress 5%Q1/2024 Q3/2027 Staff began discussions with potential service provider TBD Following completion of Tasks 1-2 4) Design and construct ↗ In Progress 50%Q3/2023 Q3/2027 In Q2/2024, the Huntington Beach Housing Authority authorized an 18-month extension to the existing Exclusive Negotiations Agreement. a) Biennial Point-in-Time Homeless County b) # of clients housed through system of care TBD Following completion of Tasks 1-3 City Manager’s Office - Homeless Services Manager B. Feasibly transition the Navigation Center to include shelter and supportive housing. A. Explore options to collaborate with faith and community-based organizations, the City’s HB Cares Volunteer program, CalOptima, and others to provide social services in a cost-effective manner. Lead Dept & Staff City Manager’s Office - Homeless Services Volunteer Coordinator and Manager Key Tasks and Deliverables (in chronological order)Completion % (est.)Key Performance Indicators (KPIs) Department Point of Contact Jessica Kelley, City Manager's Office Lt. Brian Smith, Police Department Jessica Kelley, City Manager's Office Lt. Brian Smith, Police Department GOAL 4. HOMELESSNESS Strategies Progress Status Current StatusTimeline Est. Total Project Cost 434 Success Indicator: Proactive programs to address diverse housing needs within the City’s jurisdiction and control. Start Date Due Date 1) Create a Legislative Platform with legislative advocates and topical legislative analyses ◉ Completed 100% Q3/2023 Ongoing Staff prepared a platform based on feedback from the Intergovernmental Relations Committee. The platform was approved by the City Council in Q1/2024. a) Platform complete (yes)Costs included in Goal 2.A.2. 2) Monitor proposed legislation for IRC’s consideration ◉ Completed 100% Q1/2023 Ongoing Task(s) completed as of the first biannual progress report. a) # of policy positions related to Housing taken by City Council b) # of policy positions related to Sober Living taken by City Council (new) Costs included in Goal 2.A.2. 3) Participate in regional agency efforts related to housing policy - Southern California Association of Governments (SCAG), Orange County Council of Governments (OCCOG), etc. ◉ Completed 100% Q1/2023 Ongoing Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 4) Assist City Council Members on approved H-Items related to local control ◉ Completed 100% Q1/2023 Ongoing Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time City Manager's Office - Council Policy Analyst A. Take action to maintain local control of land-use planning GOAL 5. HOUSING Strategies Progress Status Current StatusTimeline Lead Dept & Staff Est. Total Project Cost Completion % (est.) Key Tasks and Deliverables (in chronological order)Key Performance Indicators (KPIs) Department Point of Contact Shannon Levin, City Manager's Office 435 Success Indicator: Maintained and upgraded infrastructure that supports the community’s day-to-day needs, in accordance with the City’s Infrastructure Report Card Start Date Due Date 1) Hire design consultant to conduct community outreach & engagement ∆ On Hold N/A N/A N/A $200,000 One-time cost in FY23- 24 2) Develop project budget, design, and environmental review.∆ On Hold N/A N/A N/A a) No longer applicable b) No longer applicable c) No longer applicable On hold 3) Conduct a Measure C analysis, as needed ∆ On Hold N/A N/A N/A a) No longer applicable On hold 4) BID project and request allocation of funding through CIP process, to include long term maintenance plan ∆ On Hold N/A N/A N/A a) No longer applicable On hold 5) Complete project construction ↗ In Progress 95%Q3/2025 Q4/2027 a) No longer applicable b) No longer applicable c) # of beach restrooms renovated (new) TBD 1) Conduct assessment and community input of acceptable event volumes by type ↗ In Progress 95% Q4/2023 Q1/2025 Staff is reviewing recommendations by Responsible Hospitality Institute (RHI) and developing an annual calendar of current events to be presented to the Specific Events Executive Committee. $0 Costs are mainly in staff time 2) Evaluate Public Safety capacity and resources ◉ Completed 100% Q4/2023 Ongoing Ongoing efforts to supplement resources through Mutual Aid Agreements with neighboring agencies. $0 Costs are mainly in staff time 3) Conduct meetings with Specific Event Executive Committee to review Specific Event policies and procedures ↗ In Progress 50%Q4/2023 Q3/2025 Staff will present HBMC edits and Specific Event enhancement opportunities to SEEC in Q1/2025 and present to the City Council in Q2/2025 a) Draft ordinances developed b) Specific Event Permit Process Enhancements including fee recommendations (new) $0 Costs are mainly in staff time 4) Research and understand Measure C implications ↗ In Progress 25%Q4/2023 Q4/2026 Completed two rounds of community input.; will continue progress on community and stakeholder input beginning Q1/2025. a) Obtain authorization to present Measure C amendment for voter approval (yes/no) $30,000 One-time cost in FY23- 24 $150,000 One-time cost in FY24- 25 5) Explore feasibility of sole-source, long-term lease agreements for event providers ↗ In Progress 10%Q4/2023 Q3/2025 CLS will develop a feasibility analysis to include collaboration with other departments and external agency requirements. a) # of events by location (new) b) # of events by attendance size (new) c) # of permits received and executed (new) d) # of tickets by event access type (new) e) # of events by event type (new) TBD 6) Complete Central Park and City-Wide Parks & Recreation Master Plans to identify potential venue locations ↗ In Progress 45%Q4/2023 Q3/2025 Staff anticipates presenting the City-Wide Parks & Recreation Master Plan by Q2/2025. The Central Park Master Plan timeline will be developed in Q1/2025 and launched in Q2/2025. a) Completion of the Master Plans (yes/no)TBD 1) Release RFP and hire consultant to conduct the assessment ◉ Completed 100% Q4/2023 Q4/2024 City Council approved a service agreement to conduct the city-wide facility assessment in Q4/2024. $425,000 One-time cost in FY 24- 25 2) Conduct inventory/assessment of City facilities ⌂ Upcoming 0% Q1/2025 Q3/2025 Pending assessment results Included in the cost above 3) Develop financing strategy for CIP implementation and long-term maintenance ⌂ Upcoming 0% Q2/2024 Q4/2025 Pending assessment results TBD One-time cost in FY 25- 26 4) Release final report to the public ⌂ Upcoming 0% Q3/2026 Q4/2026 Pending assessment results $0 Costs are mainly in staff time 1) Conduct and adopt Water Master Plan ◉ Completed 100% Q3/2023 Q2/2024 Task(s) completed as of the second biannual progress report. a) # of feet of water pipe replaced b) # of new wells constructed $283,300 One-time cost in FY 23- 24 2) Conduct and adopt Sewer Master Plan ◉ Completed 100% Q3/2023 Q2/2024 Task(s) completed as of the second biannual progress report. a) # of feet of sewer pipe relined b) # of infrastructure repair projects completed $700,000 One-time cost in FY 23- 24 3) Conduct and adopt Mobility Plan ◉ Completed 100% Q2/2023 Q2/2024 Staff presented the Mobility Implementation Plan to the City Council in Q3/2024 a) Miles of bike lanes installed b) No longer applicable Bob Stachelski, Public Works Department $323,000 One-time cost in FY 23- 24 4) Conduct and Complete the Fleet Transition Plan ◉ Completed 100% Q4/2021 Q4/2023 Task(s) completed as of the first biannual progress report. a) # of clean air vehicles purchased annually b) # of EV charging ports installed for City Fleet Denny Bacon, Public Works Department $100,000 One-time cost in FY 23- 24 5) Conduct and adopt Fiber Master Plan ⌂ Upcoming 0% Q1/2024 Q3/2025 Pending discussions with Information Services Department a) No longer applicable John Dankha, Information Services Department" IS – Chief Information Officer TBD 6) Conduct and Complete the Infrastructure Report Card ◉ Completed 100% Q2/2023 Q1/2025 Final results will be presented at a City Council Study Session in Q1/2025. Staff is working on a cost assessment and funding strategy. KPIs to be determined following the adoption of the Infrastructure Report Card Chau Vu, Public Works Department Public Works - Director $205,000 One-time cost in FY 23- 24 B. Explore additional sports and concert venues to bolster tourism and provide world class amenities for community members C. Conduct an assessment of all City facilities to determine priorities for upgrades and repairs, implementation and financial priority. D. Undertake major planning efforts including Fleet Capital Replacement Plan, Mobility Master Plan, Fiber Master Plan, and Infrastructure Report Card to adequately anticipate and prepare for future infrastructure needs A. Provide world-class beach facilities, including the renovation and expansion of 15 beach restrooms, new lighting improvements for Pier Plaza access, security and programming Progress Status Key Tasks and Deliverables (in chronological order) GOAL 6. INFRASTRUCTURE INVESTMENT Strategies Est. Total Project CostKey Performance Indicators (KPIs) Staff has determined that renovating the restrooms is a more cost-effective solution for improving beach facilities. Department Point of ContactCurrent StatusTimelineCompletion % (est.) Chau Vu, Public Works Department Tom Herbel, Public Works Department Chau Vu, Public Works Department a) % of facilities assessed over the plan period Lead Dept & Staff Public Works - Director Community & Library Services - Director Public Works - Director Ashley Wysocki, Community & Library Services Department Chris Cole, Community & Library Services Department Molly Uemura, Community & Library Services Department Chau Vu, Public Works Department Patrick Bannon, Public Works Department Public Works - Director 436 Success Indicator: A community that has easy access to clear, accurate, and timely City information and expresses increased awareness and involvement in City activities. Start Date Due Date 1) Conduct research & develop cost/scope; issue request for expressions of interest from qualified firms ◉ Completed 100%Q3/2022 Q4/2022 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 2) Issue an RFP for a contractor to build a robust, online communication system.↗ In Progress 25%Q2/2023 Q2/2025 $0 Costs are mainly in staff time 3) Begin development of a centralized platform for City info ⌂ Upcoming 0%Q3/2024 Q1/2026 One Time Cost $150,000; Annual Cost $60,000 4) Develop a policy for use and train City staff ⌂ Upcoming 0%Q1/2026 Q1/2026 $0 Costs are mainly in staff time 5) Rollout comprehensive marketing strategy ⌂ Upcoming 0%Q2/2026 Q2/2026 Awaiting completion of Tasks 2-4.TBD 1) Issue an RFP to select a web developer ◉ Completed 100%Q3/2021 Q4/2021 Task(s) completed as of the first biannual progress report. $170,000 One-time cost in FY21-22 budget 2) Conduct site cleanup, site mapping, and design; site integration and content cleanup ◉ Completed 100% Q1/2022 Q1/2024 New City Website was launched in Q2/2024. Site editors will conduct ongoing cleanup as part of continuous site management. $0 Costs are mainly in staff time 3) Rollout comprehensive marketing strategy ◉ Completed 100%Q4/2023 Q1/2024 Information was shared via press release, social media, email newsletter, and HB Sands. Additionally, a website feedback form is available for ongoing feedback. a) # of unique visits & engagement time on news page and events page b) # of calls to call center Jennifer Carey, City Manager's Office Thuy Vi, Finance Department $10,000 One time cost in FY23-24 budget 4) Create policy for ongoing website management, user access, and content cleanup ↗ In Progress 75%Q2/2025 Ongoing Staff is drafting a proposed policy with the assistance of the Information Services Department. Website content cleanup is ongoing. a) No longer applicable Jennifer Carey, City Manager's Office $0 Costs are mainly in staff time 1) Expand outreach through Town Halls, Coffee with the Mayor, and enhanced certificate/award program ◉ Completed 100% Q1/2023 Ongoing Task(s) completed as of the first biannual progress report. $5,000/year Budgeted in FY23-24 2) Develop & produce new digital content – PSAs, Mayor’s Roundtable, Public Safety Awareness, etc. ◉ Completed 100% Q1/2023 Ongoing Task(s) completed as of the first biannual progress report. $50,000/year Budgeted in FY23-24 3) Create & purchase outreach kit – to include tents, banners, tables, handouts, collateral ◉ Completed 100% Q3/2023 Ongoing Staff continues to create a ‘HB Promo Inventory’ with procedures to enable other departments to order promotional materials that are consistent with the City’s brand $10,000 annually 4) Collaborate with partners to identify more opportunities to engage with residents & businesses ◉ Completed 100% Q3/2023 Ongoing Staff continues to develop a community stakeholder contact list and outreach channels. $0 Costs are mainly in staff time 5) Develop PIO committee from all Departments committed to developing effective citywide quarterly mailers and public feedback materials based on existing needs ⌂ Upcoming 0%Q3/2024 Ongoing Staff will identify PIO contact(s) for each City Department and develop a comprehensive list of programs, services, and activities for further promotion and engagement. $0 Costs are mainly in staff time 6) Create a consolidated citywide event calendar and policy for planning and implementing events ◉ Completed 100% Q1/2023 Q1/2023 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 7) Launch Community Engagement Platform ↗ In Progress 20%Q4/2023 Q2/2025 Staff is rebranding based on comprehensive community feedback and surveying programs. The staff is in discussions with different technology providers to identify potential products and costs. $10,000 One time cost in FY24-25 budget 1) Buildout downstairs studio & update equipment ◉ Completed 100%Q2/2023 Q2/2024 Task(s) completed as of the first biannual progress report. $175,000 Using PEG funds restricted to use on public TV capital only 2) Hire HBTV Media Coordinator ◉ Completed 100% Q2/2024 Q3/2024 New Media Coordinator started in Q3/2024. $0 Costs are mainly in staff time 3) Develop informative & varied content with purpose and reflective of Huntington Beach ◉ Completed 100% Q1/2024 Q1/2025 Staff continues to collaborate with the Communications Committee and various departments to create original content. $420,000 Across four years 1) Hire Graphic Designer ◉ Completed 100% Q2/2023 Q4/2023 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 2) Develop Citywide Branding Guide ◉ Completed 100% Q1/2023 Q1/2024 Task(s) completed as of the first biannual progress report. $0 Costs are mainly in staff time 3) Develop Citywide policy on public facing graphics/content ◉ Completed 100% Q2/2023 Q1/2024 Staff implemented a policy guide that provides guidance on how and when to display graphics. $0 Costs are mainly in staff time 4) Develop standardized templates and materials for citywide use ◉ Completed 100% Q3/2023 Q1/2025 Staff continued to standardize templates and materials, such as flyers, agendas, and presentations $0 Costs are mainly in staff time E. Hire a graphic designer to incorporate the City’s Branding Guide throughout the organization for greater consistency and appeal across all City visual content. City Manager’s Office - Public Affairs Manager City Manager’s Office - Public Affairs Manager B. Redesign the City’s website to increase its versatility and enhance user experience with easy to access information C. Expand and enhance community outreach engagement opportunities through neighborhood town halls, direct mailers, and videos D. Enhance capacity of HBTV and produce relevant television content to expand the City’s public engagement reach across diverse audiences A. Implement a robust online communication system to manage/track calls for services and provide one centralized location for community members to obtain all City information and services. City Manager’s Office - Public Affairs Manager City Manager’s Office - Public Affairs Manager City Manager’s Office - Public Affairs Manager Jennifer Carey, City Manager's Office Jennifer Carey, City Manager's Office Cody Long, City Manager's Office Jennifer Carey, City Manager's Office Jennifer Carey, City Manager's Office GOAL 7. PUBLIC ENGAGEMENT Strategies Lead Dept & StaffProgress Status Current StatusTimeline Est. Total Project CostCompletion % (est.) Key Tasks and Deliverables (in chronological order)Key Performance Indicators (KPIs)Department Point of Contact Staff continues to meet with MyHB provider to identify additional features and options for expanding the usability and efficiency of current system KPIs dependent on My HB deliverables. a) # of social media engagements and impressions (incl. Facebook, Instagram, X) b) # of YouTube engagements and impressions (new) Jennifer Carey, City Manager's Office Cody Long, City Manager's Officea) # of online videos created 437 Success Indicator: Ensure the safety and protection of all community members, both efficiently and effectively Start Date Due Date 1) Lead a community wide comprehensive risk reduction strategy and culture to minimize incidents and optimize emergency response ↗ In Progress 75%Q3/2023 Q4/2026 Staff continues to use data analytics to be more proactive in CRR for improved customer-centered services a) Form a work group with Police, Fire, IS, Public Works (Complete) b) # of monthly calls for service c) Form a quarterly work group with all Fire divisions to review staff risk reduction strategies (Complete) d) Receive the American Heart Association (AHA) Mission: Lifeline EMS Recognition for excellent prehospital heart attack care. (Complete) e) Meet FireScope Type Requirement (Complete) f) % of Lifeguards/Marine Safety Officers meeting US Lifesaving Assoc. requirements (Complete) g) # of sidewalk CPR trainings conducted $200,000 One time cost for FY25- 26 2) Realignment of inspection assignments and frequencies to improve departmental efficiencies and customer service ◉ Completed 100% Q3/2022 Q4/2023 Task(s) completed as of the first biannual progress report. a) % of Life Safety and Fire Permit inspections completed (Complete) b) % of State-mandated occupancy inspections completed (Complete) $0 Costs are mainly in staff time 3) Implement Intern program ◉ Completed 100% Q4/2022 Q3/2023 Task(s) completed as of the first biannual progress report. a) # of youth enrolled in Fire Explorers program b) # of ambulance operators and lifeguards sponsored for fire academies and/or paramedic school $0 Costs are mainly in staff time 4) Cultivate a business centered customer service culture fostered on communication, consistency and transparency ↗ In Progress 75%Q1/2023 Q2/2025 Staff continues to use data analytics to be more proactive in CRR for improved customer-centered services a) Meet quarterly with the Chamber of Commerce, Downtown BID, and small business owners to discuss business/community feedback related to business, development, and customer service (yes) $0 Costs are mainly in staff time 5) Implement an emergency pre-plan program ◉ Completed 100% Q3/2023 Q3/2024 100% of suppression personnel trained in the new emergency pre-plan program (First Due) a) Yearly redefine target hazards using data and redefine response grid as needed (yes) b) % of suppression personnel trained on the new emergency pre-plan program (Complete) $0 Costs are mainly in staff time 6) Utilize analytics to implement targeted risk reduction campaigns designed to reduce emergency response ↗ In Progress 80%Q3/2022 Q2/2025 Staff continues to conduct beta tests campaigns for targeted risk reduction. a) # of Life Safety and Fire Permit Inspections $0 Costs are mainly in staff time 7) Establish a full-time Fire Department community engagement coordinator ↗ In Progress 80%Q3/2023 Q2/2025 A limited-time Management Aide is included in the FY 24/25 budget and is funded by Opioid Settlement Funds. $0 Costs are mainly in staff time 8) Expand Junior Lifeguard Coordinators to full-time Integration of interdepartmental opioid prevention and community ↗ In Progress 10%Q3/2023 Q2/2025 In Q4 2024, the City Council approved a contract for a part-time Chief Medical Officer. This new role, funded by Opioid Settlement Funds, will focus on developing programs to address substance use disorder healthcare and enhance community engagement services. $0 Costs are mainly in staff time 9) Develop a Cyber Security Master Plan to secure the City’s networks and ensure continued operations, in emergency situations ↗ In Progress 10%Q4/2022 Q4/2027 Staff continues to conduct training, invest in upgrades, and explore measures to elevate the city's posture against Cyber Security threats. a) # of cyber security threats/attacks detected and prevented John Dankha, Information Services Department IS – Chief Information Officer TBD 1) Prepare an IS Disaster Recovery Plan ⌂ Upcoming 0% Q1/2024 Q4/2026 Staff is working to secure funding for a consultant to help develop the IS Disaster Recovery Plan. a) # of phishing training emails issued b) # of trainings to be developed and to be completed (min. 12/year) c) % of training completed John Dankha, Information Services Department IS – Chief Information Officer TBD 2) Update emergency preparedness plans and special events management plans via the Emergency Operations Center ↗ In Progress 95%Q3/2022 Q2/2025 In Q2/2024, staff updated the Earthquake Annex and conducted an earthquake exercise. They also completed the Cyber Response Annex and are planning to conduct an exercise in 2025. Additionally, staff is preparing new annexes for Care and Shelter and Debris Management a) % of staffing matrix for special events finalized b) Maintain minimum number of Community Emergency Response Team and Radio Amateur Civil Emergency Services (RACES) volunteers (Yes) Brevyn Mettler, Fire Department Fire - EOC Manager $0 Costs are mainly in staff time 3) Identify funding for the real time crime center ↗ In Progress 50%Q4/2023 Q1/2028 The FY 24/25 budget includes funding for a supervisor. Staff will continue to explore additional funding for the Real Time Crime Center. TBD 4) Develop the real time crime center ↗ In Progress 95%Q4/2023 Q2/2025 Development is to be completed in Q4/2024 and will include the hiring of two Real Time Crime Center Specialists. Budget incl. in a larger FY23-24 CIP project B. Bolster City’s emergency management preparedness and response plans to ensure seamless public safety response during crisis events. A. Community-wide comprehensive risk reduction program to optimize public safety’s emergency response and reduce the number of calls. Fire - Chief Martin Ortiz, Fire Department Darrin Witt, Fire Department Bonnie To, Fire Department Rachel Ogden, Fire Department Capt. Oscar Garcia, Police DepartmentKPI's to be determined following the launch of the Real Time Crime Center KPIs to be determined following the launch of the Opioid Settlement Spending Plan Police – Patrol Division Captain GOAL 8. PUBLIC SAFETY Strategies Lead Dept & StaffProgress Status Current StatusTimelineCompletion % (est.)Est. Total Project CostKey Tasks and Deliverables (in chronological order)Key Performance Indicators (KPIs) Department Point of Contact 438 January 21, 2025 City Manager’s Office Biannual Progress Update #3 439 C:tTY t,F UVNTINt>Tt,N BEAC:U Strategic Planning 2023-2027 T I M E L I N E October 3, 2023 City Council approved the FY 2023-2027 Strategic Plan July 16, 2024 Second Biannual Update to City Council M O V I N G F O R W A R D Staff will present biannual progress updates in January and July to ensure: •Transparency and accountability •Alignment with current resources and policies •Regular opportunities for City Council to provide feedback and recommend amendments Background 2S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3440 O V E R V I E W 2 Overarching Goals 8 Strategies 23 Tasks 98 Key Performance Indicators (KPIs) 73 Vision 1 “Committed to Responsive and Exceptional Public Service to All.” 2S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3441 , Completed 53% In Progress 29% Overall Progress as of December 2024 Upcoming 10% On Hold 8% 4S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3442 --------------------------------------------------------------------------- Accomplishments Updated the Economic Development Strategy and presented to City Council in Q4 2024. Completed 100%In Progress0% Upcoming Goal 1: Economic Development Future Tasks Track and monitor new Key Performance Indicators associated with the updated Economic Development Strategy. KPI Highlights # of new business licenses: 1,034 # of business visits (new) # of businesses assisted (new) # of touches with brokers, property owners, & existing or prospective businesses (new) *Data for new KPIs will be included in the upcoming update 0% 5S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3443 --------------------------------------------------------------------------- Total valuation of grants applied,awarded, & by category/sector:15 grants, $20.8M, 5 categories Real Estate Program KPIs (TBD) Future Tasks Establish a centralized Real Estate Program Accomplishments 20%On Hold Completed 40%In Progress40% Goal 2: Fiscal Stability Formed an interdepartmental working group to enhance citywide efforts on identifying and applying for external funding Issued a RFP for a lease consultant to evaluate and audit city- owned leased assets KPI Highlights 6S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3444 --------------------------------------------------------------------------- Accela customer satisfaction rate survey rating:4.8/5 # of permit applications processed & completed:9,119;8,618 # of certificate of occupancy issued:618 Continue advancing the Streamline Surf City Initiatives (7 in progress & 6 upcoming) Launch online performance evaluation system for City staff Launched Streamline Surf City;completed 15 of 28 initiatives. Implemented an online training portal for city staff and public officials Upcoming5% 32%52% Goal 3: High Performing Organization On Hold11% In Progress Completed Accomplishments Future Tasks KPI Highlights 7S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3445 --------------------------------------------------------------------------- # of volunteer hour & % of active volunteers:369; 64% # of Be Well services, referrals, &clients:6,441 # of clients housed through system of care:76 Continue working with Jamboree Housing Corporation to develop the Pathways Project Built a network of 20+organizations to assist with needs and services Goal 4: Homelessness Completed 50%In Progress50% Upcoming0% Accomplishments Future Tasks KPI Highlights 8S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3446 --------------------------------------------------------------------------- # of housing & sober living related policy positions taken by City Council:31 #of households received TBRA &rehabilitated:53 # of code enforcement violations investigated & enforced:903 Continue to monitor legislation related to local control of land-use planning Continue to participate in regional agency efforts related to housing policy Created a Legislative Platform for the City Goal 5: Housing Completed 100%In Progress0% Upcoming0% Accomplishments Future Tasks KPI Highlights 9S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3447 --------------------------------------------------------------------------- # of beach restroom renovated (new) # of events by location, attendance & type (new) # of special event permits executed:78 % of facilities assessed (new) *Data for new KPIs will be included in the upcoming update Present enhanced Specific Events policies and procedures to the City Council Complete the Central Park Master Plan Present the City-Wide Park &Recreation Master Plan Completed the Water Master Plan, Sewer Master Plan,Mobility Plan, and Fleet Transition Plan Began renovating beach restroom facilities Goal 6: Infrastructure Investment Upcoming23% 27%31% On Hold19% In Progress Completed Accomplishments Future Tasks KPI Highlights 10S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3448 --------------------------------------------------------------------------- # of website visitors, views, & average engagement time: 685,066; 1.9M, 48.7 seconds # of calls to call center: 13,778 # of social media engagements & impressions: 92,700; 2.6M # of online videos created: 181 Create a city policy for website management. Launched new city website Established a standardized branding guide Hired a HBTV Media Coordinator Goal 7: Public Engagement Completed 73%In Progress12% Upcoming15% Accomplishments Future Tasks KPI Highlights 11S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3449 --------------------------------------------------------------------------- # of monthly calls & sidewalk CPR trainings conducted: 21,350; 12,491 # of youth enrolled in Fire explorers program: 154 #infrastructure & network security measures: 21.2M Implement interdepartmental opioid prevention efforts Develop the Real Time Crime Center and hire specialists Received the American Heart Association Lifeline EMS Recognition for excellent pre -hospital heart attack care. Secured funding for the construction of the Real Time Crime Center and a dedicated supervisor Goal 8: Public Safety Completed 17%In Progress70% Upcoming13% Accomplishments Future Tasks KPI Highlights 12S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3450 --------------------------------------------------------------------------- O n Ho ld 21% increase in "Completed" Tasks P rogr es s D as h bo a rdMajor Highlights Public data dashboard available on the City's Website Increase in "on-hold tasks" due to staff identifying and implementing alternative cost-saving approaches to achieve the same objectives. 13S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3451 ~ ~ ~ ~ ~ Data Dashboard 14S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3452 --------------------------------------------------------------------------- ~ 4.8 Customer sati'Sfaction rating ( • out of 5) Recommendation Receive and file the 2023 -27 Strategic Plan Biannual Progress Update #3 15S t r a t e g i c P l a n P r o g r e s s U p d a t e # 3453 I ---....._..._...__ City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:24-929 MEETING DATE:1/21/2025 REQUEST FOR SUCCESOR AGENCY ACTION SUBMITTED TO:Honorable Chair and Board Members SUBMITTED BY:Travis Hopkins, Acting Executive Director PREPARED BY:David Cain, Interim Chief Financial Officer Subject: Adopt Successor Agency Resolution Nos. 2025-01 and 2025-02 approving the Recognized Obligation Payment Schedule (ROPS) and Administrative Budget for the Huntington Beach Successor Agency for the period of July 1, 2025, through June 30, 2026, in accordance with Health and Safety Code Section 34177 and related actions Statement of Issue: The Successor Agency is requested to approve the Recognized Obligation Payment Schedule (ROPS) and Administrative Budget for the period of July 1, 2025,through June 30, 2026.An approved ROPS must be submitted to the County of Orange Oversight Board by January 22, 2025, and then to the Department of Finance (DOF) by February 1, 2025. This is the seventh year that the Successor Agency is submitting the annual ROPS to the Countywide Oversight Board. Financial Impact: The ROPS provides the County Auditor-Controller with the amount of the former Redevelopment Agency’s enforceable obligations for which the Successor Agency anticipates incurring expenditures. Once approved by DOF, the Successor Agency will be entitled to receive property tax revenue up to the amount of the DOF-approved enforceable obligations included in the Payment Schedule. The ROPS requests $10,768,498 in funds to support existing legally required enforceable obligations for FY 2025/26. Recommended Action: A) Adopt Resolution No. 2025-01, “A Resolution of the Successor Agency to the Redevelopment Agency of the City of Huntington Beach Approving the Recognized Obligation Payment Schedule for the Period July 1, 2025 - June 30, 2026 (‘ROPS 25-26’);” and B) Adopt Resolution No. 2025-02, “A Resolution of the Successor Agency to the Redevelopment Agency of the City of Huntington Beach Approving the Successor Agency Administrative Budget for the Period July 1, 2025, through June 30, 2026.” Alternative Action(s): Do not approve the recommended action(s) and direct staff accordingly. City of Huntington Beach Printed on 1/16/2025Page 1 of 3 powered by Legistar™ 454 File #:24-929 MEETING DATE:1/21/2025 Per Health and Safety Code Section 34179(j), the Successor Agency is required to submit the ROPS to the Countywide Oversight Board and the Department of Finance by February 1 st of each year. Per Health and Safety Code Section 34177 (o)(1), the City would be assessed a $10,000 per-day penalty for failure to submit the ROPS on a timely basis. Additionally, failure to submit the ROPS within ten (10) days of the deadline may result in a 25% reduction of the Successor Agency’s maximum administrative cost allowance for the period covered by the delinquent ROPS. Should the Agency fail to submit the ROPS, expenditures totaling $2,330,100 would need to be covered through alternate sources of funding in Fiscal Year 2025-26. The Agency would also postpone the receipt of $8,438,398 in loan funds to be repaid to the City’s General Fund and Low and Moderate Income Housing Asset Fund to the Fiscal Year 2026-27 ROPS or later. Analysis: As part of the 2011 Budget Act, as recommended by then Governor Jerry Brown, the Legislature approved the dissolution of the State’s Redevelopment Agencies. After litigation, the California Supreme Court ruled on the Dissolution Act that all redevelopment agencies in California were dissolved effective February 1, 2012. The Dissolution Act, AB 1484, and related legislation describe the procedures to wind down the affairs of the former redevelopment agencies. These provisions include the continued payment of recognized enforceable obligations as defined in the law. The ROPS for July 1, 2025, through June 30, 2026, requests payment for enforceable obligations associated with development agreements, legal services, administrative budget, and other miscellaneous costs. Of note, the ROPS also includes a request for funds in the amount of $8,438,398 to repay a portion of monies owed to the City from the former Redevelopment Agency for the purchase of real property (the “Waterfront Loan”) in Fiscal Year 1988-89 in the amount of $22.4M, which was loaned to the agency at a 10-percent interest rate. Between 1989 and 2011, the former Redevelopment Agency made payments on various City-Agency loans, with $14.8M of these payments being applied to the Waterfront loan. This loan had been listed on previous ROPS and denied by the DOF until it was ultimately approved as an enforceable obligation by the California Superior Court on February 17, 2023. The Department of Finance concurred with the Court’s ruling in their letter dated May 19, 2023 , stating the following: “Waterfront Commercial Master Site Plan. Finance no longer denies this item. In compliance with the Judgement, the Agreement for the Purchase and Sale of Property (Waterfront Loan) dated September 19, 1988, between the City and the former Redevelopment Agency of the City of Huntington Beach is considered an enforceable obligation, and future requests for funding of supported outstanding amounts will be allowable.” The total amount of the loan as of June 30, 2025, will be $23,076,317, comprised of $13,804,292 in principal and $9,272,025 in accrued interest calculated in accordance with Health and Safety Code Section 34191.4(b)(3) “If the oversight board finds that the loan is an enforceable obligation, any interest on the remaining principal amount of the loan that was previously unpaid after the original effective date of the loan shall be recalculated from the date of origination of the loan as approved by City of Huntington Beach Printed on 1/16/2025Page 2 of 3 powered by Legistar™ 455 File #:24-929 MEETING DATE:1/21/2025 the redevelopment agency on a quarterly basis, at a simple interest rate of 3 percent. The recalculated loan shall be repaid to the city, county, or city and county in accordance with a defined schedule over a reasonable term of years. Moneys repaid shall be applied first to the principal, and second to the interest.” The $8,438,398 repayment amount requested in the FY 2025/26 ROPS was calculated using the Department of Finance’s Sponsoring Entity Loan Repayment Calculator based on the provisions outlined in Health and Safety Code Section 34191.4(b)(3)(A), which calculated the maximum repayment amount authorized per fiscal year. This amount will be recalculated each fiscal year based on the estimated tax revenue available for repayment of the loan as required by Health and Safety Code Section 34191.3(b)(3)(A). The County Oversight Board will review and approve the City’s current ROPS during its January 28 , 2025 meeting. The City must submit to the State DOF by February 1, 2025. The State DOF will make its determination by April 15th. The City’s ROPS will not be effective until approved by the State DOF. Environmental Status: This action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Strategic Plan Goal: Goal 2 - Fiscal Stability, Strategy A - Consider new revenue sources and opportunities to support the City's priority initiatives and projects. Attachment(s): 1. Resolution No. 2025-01, “A Resolution of the Successor Agency to the Redevelopment Agency of the City of Huntington Beach Approving the Recognized Obligation Payment Schedule for the Period July 1, 2025 - June 30, 2026 (‘ROPS 25-26’)” 2. Resolution No. 2025-02, “A Resolution of the Successor Agency to the Redevelopment Agency of the City of Huntington Beach Approving the Successor Agency Administrative Budget for the Period July 1, 2025 Through June 30, 2026” 3. Superior Court of California Ruling dated February 17, 2023 4. Department of Finance Recognized Obligation Payment Schedule Letter dated May 19, 2023 5. Department of Finance Section 34191.4(b)(3)(A) Sponsoring Entity Loan Repayment Calculator 6. Recalculated Waterfront Loan per Health and Safety Code Section 34191.4(b)(3) 7. PowerPoint Presentation City of Huntington Beach Printed on 1/16/2025Page 3 of 3 powered by Legistar™ 456 457 RESOLUTION NO. 2025-01 A RESOLUTION OF THE SUCCESSOR AGENCY TO THE REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH APPROVING THE RECOGNIZED OBLIGATION PAYMENT SCHEDULE FOR THE PERIOD JULY I, 2025-JUNE 30, 2026 ("ROPS 25-26") WHEREAS, pursuant to AB xi 26 (as amended by AB 1484, the "Dissolution Act"), the separate legal entity known as Successor Agency to the Redevelopment Agency of the City of Huntington Beach ("Successor Agency") must prepare "Recognized Obligation Payment Schedules" ("ROPS") that enumerate the enforceable obligations and expenses of the Successor Agency for each successive annual fiscal period until the wind down and disposition of assets of the former Redevelopment Agency of the City of Huntington Beach; and The Successor Agency staff has prepared a ROPS for the annual fiscal period commencing on July 1, 2025 and continuing through June 30, 2026 ("ROPS 25-26") which is attached hereto as Exhibit A; and After reviewing ROPS 25-26, presented to and recommended for approval by Successor Agency staff, and after reviewing any written and oral comments from the public relating thereto, the Successor Agency Board desires to approve the ROPS 25-26; and All of the prerequisites with respect to the approval of this Resolution have been met. NOW, THEREFORE, the Successor Agency to the Redevelopment Agency of the City of Huntington Beach does hereby resolve as follows: I. The Successor Agency hereby finds and determines that the foregoing recitals are true and correct. 2. The Successor Agency hereby approves ROPS 25-26 in the form presented to the Successor Agency and attached hereto as Exhibit A, and hereby determines that such agreements and obligations constitute "enforceable obligations" m1d "recognized obligations" for all purposes under the Dissolution Act. 3. The Successor Agency authorizes and directs the Successor Agency staff to: (i) take all actions necessary under the Dissolution Act to post ROPS 25-26 on the Successor Agency website once approved by the Oversight Board to the Successor Agency; (ii) transmit ROPS 25'-26 to the Auditor-Controller and the County Administrator of the County of Orange and to the State Controller and the State Depmiment of Finance ("DOF"); and (iii) to do any and all things and to execute and deliver any and all documents which may be necessary or advisable in order to effectuate the purposes of this Resolution. In addition, the Successor Agency authorizes and directs the Successor Agency staff to make such non-substantive revisions to ROPS 25-26 as may be necessary to submit ROPS 25-26 in any modified form required by DOF, and ROPS 25-26 as so modified shall thereupon constitute ROPS 25-26 as approved by the Successor Agency pursuant to this Resolution. 24-15770/36420 I I 458 RESOLUTION NO. 2025-01 4 . The Successor Agency authorizes the Executive Director, or designee, to make such non-substantive changes and amendments to ROPS 25-26 as may be approved by the Executive Director of the Successor Agency and its legal counsel, ROPS 25-26 as so modified shall thereupon constitute ROPS 25-26 as approved by the Successor Agency pursuant to this Resolution. 5. The Successor Agency does not intend, by adoption of this Resolution, to waive any constitutional, legal and/or equitable rights of the Successor Agency or the City of Huntington Beach under law and/or in equity by vi1tue of the adoption of this Resolution and actions approved and taken pursuant to this Resolution and, therefore, reserves all such rights of the Successor Agency and the City of Huntington Beach under law and/or in equity. PASSED AND ADOPTED by the Successor Agency to the Redevelopment Agency of the City of Huntington Beach at a regular meeting thereof held on the __ day of January, 2025. Chairperson REVIEWED AND APPROVED: ~utive Dirt/ 24-15 770/3 642 01 2 459 EXHIBIT A RECOGNIZED OBLIGATION PAYMENT SCHEDULE FOR THE PERIOD JULY 1, 2025 THROUGH JUNE 30, 2026 ("ROPS 25-26") [behind this page] 460 Recognized Obligation Payment Scehdule (ROPS 25-26) -Summary Filed for the July 1, 2025 through June 30, 2026 Period Successor Agency: Huntington Beach County: Orange Current Period Requested Funding for Enforceable Obligations (ROPS Detail) A Enforceable Obligations Funded as Follows (B+C+D): B Bond Proceeds C Reserve Balance D Other Funds E Redevelopment Property Tax Trust Fund (RPTTF) (F+G): F RPTTF G Administrative RPTTF H Current Period Enforceable Obligations (A+E): Certification of Oversight Board Chairman: Pursuant to Section 34177 (o) of the Health and Safety Code, I hereby certify that the above is a true and accurate Recognized Obligation Payment Schedule for the above named successor agency. 25-26A Total (July -December) $ $ $ $ $ 4,862,480 $ 4,737,480 $ 125,000 $ 4,862,480 Signature Title Signature Title 25-26B Total (January-June) ROPS 25-26 Total $ $ $ $ $ $ $ $ $ 5,906,018 $ 10,768,498 $ 5,781,018 $ 10,518,498 $ 125,000 $ 250,000 $ 5,906,018 $ 10,768,498 461 A • C 0 E F G A,grnmont -'greernenl Item# Proiflct Nama/Debt nw ..... ,o Obi abon Tv011 E.xecuton Cate Ttnnlnabon Oa'ia Pavee Oucnot1on/P1oiect Scoce 3 BCH1ds lui»d On 2002 Tax Allocation or before Bank of New Tax Allocat1on Bonds Debt Refundinc Bonds 12/31/10 6119/2002 811/2024 York Trust Co. Service Payments . Bonds Issued On 1999TuAJtocat10n or before Bank of New Tax Alloation Bonds Debt Refuncllna Bonds 12/31/10 1112/1999 811/'20'24 YorkTNs!Co S.rvlco Pavmtints • ......... !Tax AlloeallOn Bonds a1bitrage 2002Tax>Jlocaaon Compliance r.batll calculation-Federal IRS Ref\Jndlno Bonds Fees 11117/2010 613()1202< SPeelalist Com tian<:e • Albinge !Tax Allocation Bonds arbitrage 1999TaxAlloca\lon Compl~nce rebate c;alculaton-Federal IRS R•funding Bonds Fees 11/17/2010 6/30/202< Specialist Compll;ance • 2002 Tait Allocation Bank of New Tax Allocation Bonds• P.iy"10nt Refundlno Sonds F•es 6/19f2002 8/1/2024 Yor~ MIiion to Fixal Age,nt • t 999 Tax.Alloe;a'Jon B;ankol Now Tax Alloe:auon Bonds• P.iymont Refundlna Bonds F•es t/12/1999 8/1/2024 York MeUon to F1Kal Aoent 12 Emer.ak::1 Cove 2010 SeMs Bonds Issued On Emarak::1 Cove 2010 Senn A IA LUSCI Rev•nu1 or ti.lot• Leasci Revenue Refunding Refunding Bonds 12f.ll/10 5113/2010 9/1/2021 US Bank Bonds Debt Service Payments ,. Property Tax Sharing AQ1eement Under lhe Oispc,s.tJon and Oeve!oi,meMI !Agreement (ODA) tor !development of hotltl, rebH, restaurant. and public parking structura The trnplementatlon fol the DOA and lhl Shrtn CIM Group LLC 11T1pl-,neMt1t1on Agreemen1 S1nmd Ho tel and Mi.xed -Usci and Kane were entarea ln'IO ffom June P,o,ect. Parlung & OPA/ODAJ B;allmer and 1999 to Novembtir 2008 !nftastruct1,Jfe Construcilon 611/1999 91JC12033 Serilkman 15 , . .,.,,, ax ;::,nanng Ag,eemem under 1h41 Orspos.tion and Development A;•eemem (DOA ) and Sixa, lmplemt1nu.t10n Agreement for h SUnd PfOiects p:.rkmg Snno Pto,tict Add1::onal OPAJOOA/ sU\Jcture authonzed on J:artual')' Parlgna CorislrUction 1120/2C09 9130/2033 CIM Grour:,, l lC 20, 2009 Huntlnglon Beach Recognized O btlg.aitlcn P.ai)'ml!ntSchtdule (ROPS 25-2') ~ ROPS 0.tall July 1 , 2025 lt\rou;h June 30, 202& (Report Am ounts In Whole Dollars) H I J K l M N 0 Total 2S·21A IJulv-0Kffllberl OUts~ncllng Fund Sources Oebtor ROPS 25-2& "°"" Reser,.,e Prolltd.Alea Obliaation Rellfed Total Proceeds Balar'Q Other Funds RPTTF s -412.,959,944 S 10,768.498 s s ' $ .... , .. , 480 Merged y s Merged y s Mer;od y ' Mer;ed y s Me111ed y ' M•r;e-d y • Mer;ed y s M.,.ged 5 184,886 N ' 677,904 •n 904 M•rg•d 4443n N ' ,9 575 49.576 p C R s T u V w 25-26B (J~n uarv -Jun el Fun d Sources ~S-26A .. ,,., RtM~ 25-268 Admin RPTTF Tobi Proceed s Balance Olher Funds RPTI'F 0 tAdmln RPTTF Total ' 125.000 s 4 852.480 ' ' ' S 5,781,0 18 ' 125.000 ' 5,906.018 ' s ' s s s ' s ' ' ' s ' s ' 677.90400 ' ' 49Si600 $ 462 ,------,.; 15% afford:abl• holJsir,g equiromel"lt pYr:IUlnt b Attlchment 5 o r N Ownilt Pat'SQpation Agreement approve d on Oc»ber 16, 2006 Ofthti15¾ requited housing obllgatlon, 5'ti very-low income housing 1, lo be developed by ithfl Housing Authority The Paeific Qty-Very Low OPAIDOAI 0.-veloper Is required to PfOVlde llt,e remarnlng 10lMi on site Income Units c-=n 10,1612006 11f26.'202• Maka, Prooertes Me1ged y s s $ 21 Owner Partx:i~llon Agreement .... O,l'feNi n11al Agteel'Tllnt approved on May 25, 1991,for the de'lelopmentof tne lhree~ story bulding a1 thit Oceanv•w PtGmlnacfe The, Thcrd Abdelmud1 OM,er Abdelmidl ln"11"~mentation Amendment Parccipalion Agreemenll OPAIOOAI Development ~k effect on November 21, Renl O.ttlren~al Agreemant Col'l$truetlon 5128/1991 12/3112017 Comp;i,ny Merced y $ s s 29 Pro~rty Tax Shanng Agreement reqyjred under in. terms of the ~r Par1Jcipati on Agreement (d3ted 1012/2000) ;md Second lmplementabon Agreemant (d ated 9117/2007) fOl'lhedevelopmemofh Huntington Center (Bella Terra) lnchJdu legal r1qurrement1 to 8111:lla Tllf:I Park.Ing e nforc. obhga,jon lnh1tr\Jc;11Jre Property Tu: OPIVDOAI Bella Tuna Sharing A&lrHment ConslNctlon 10/2/2000 9/30/202S Assoda:es l lC Merced y $ I $ ,0 Agtffmem approv.-d on Oetobu ◄, 2CJ10 for consTIICtion of a ◄67 mi,:ed-use unit proJ■Cl ConsU'UCtlOn is complete and fiNnced by propertf tall Bella Terra Phase II Bell■ Terr■ Villu alloe11tlons Includes legal Properfy Tax Shanng CPA/COAi LlC and Kane requiremeMt to m ptement Agreement Cons:rlJCtOn 10/"'2010 1/1/2036 B.;18mer Berkman tibllgallOn. Merced 10,494,36-1 N $ 1,342,620 s 1.342,620 $ 1,3-12.62000 "' S1.1CCesso r Suc.ces50r Agency Agency Kane admlnls!nttve obligations Enforcement of Successor B.:lllme,, Ktiys.er e!abngto maintaining Age ncy dluoMitin Matstan, and payments tin enforceable Merged and c:omph arx;e and mon,tonng Davis Farr P ■t al 0bb;a110ns and olt'ler aCDvab■s South■ut perA.8 1X26andAB 1,1&4 AdmlnCosts 21112012 1 1/26/20◄0 as 1equlred by AB 1X26 c~stal 3 ,750.000 N s 250,000 125.000 • 125,00000 125.000 $ 125.00000 .. Sta tutanly requlad annual Successor Aganey Frnanclll fin.incial statement audit of St:aterTWntAudit 011solunonAuclits 11/4/2013 6/112025 Oav,s Farr l lP Successor Aoeney Merced 10.000 N $ 10.000 10,000 • 10000 00 s 79 City/County loan l egaUy Binding Operat1'18 (Pno1 ,'.greemenl Pnnclpal Amount • 06/2611 1).Propert City ot Huntinir,on St ,7◄0,BJ.I lnlllrnt Ra:n 3%, Land Sale Emerald Cove y 1r1nsact10n S/11112009 10J1f2030 Beach Debt Incurred en Ma ,a. 2009 Merced y s • s 119 City/County lo.■n (Pnot 'Natarlront Ccimmerci.aJ 0612811 1 }.Propert Cit)' ol HunDngton Acqul11t10n of V\latarfron1 MHt■rS,te P!:1n [yttnHCt.On 911911988 6l30l20<() Beach Property Merced 23078317 N s B -138.398 4,000,000 ' -4 000 000 4 438 ,398 s 4 438 398 463 RESOLUTION NO. 2025-02 A RESOLUTION OF THE SUCCESSOR AGENCY TO THE REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH APPROVING THE SUCCESSOR AGENCY ADMINISTRATIVE BUDGET FOR THE PERIOD JULY 1, 2025 THROUGH JUNE 30, 2026 WHEREAS, California Health and Safety Code section 34177(j) requires that the Successor Agency to the Redevelopment Agency of the City of Huntington Beach ("Successor Agency") prepare an administrative budget for each annual fiscal period; and A draft administrative budget for the fiscal period of July 1, 2025 through June 30, 2026 ("Administrative Budget") is attached hereto as Exhibit A; and California Health and Safety Code section 34 I 77(k) requires the Successor Agency to provide to the County Auditor-Controller administrative cost estimates for expenses from the administrative budget that are to be paid from property tax revenues deposited in the Redevelopment Property Tax Trust Fund for each annual fiscal period; and All of the prerequisites with respect to the approval of this Resolution have been met. NOW, THEREFORE, the Successor Agency to the Redevelopment Agency of the City of Huntington Beach does hereby resolve as follows: 1. The Successor Agency hereby finds and determines that the foregoing recitals are true and correct. 2. The Administrative Budget attached hereto as Exhibit A is hereby approved. 3. The Successor Agency staff is directed to: (i) provide the required cost estimates for expenses to the County Auditor-Controller; and (ii) to do any and all things and to execute and deliver any and all documents which may be necessary or advisable in order to effectuate the purposes of this Resolution. 4. The Successor Agency does not intend, by adoption of this Resolution, to waive any constitutional, legal and/or equitable rights of the Successor Agency or the City of Huntington Beach under law and/or in equity by virtue of the adoption of this Resolution and actions approved and taken pursuant to this Resolution and, therefore, reserves all such rights of the Successor Agency and the City of Huntington Beach under law and/or in equity. 24-15770/364202 1 464 RESOLUTION NO. 2025 -02 PASSED AND ADOPTED by the Successor Agency to the Redevelopment Agency of the City of Huntington Beach at a regular meeting thereof held on the __ day of January, 2025. Chairperson REVIEWED AND APPROVED: 24-15770/3 64202 2 465 24-15770/364202 RESOLUTION NO. 2025-02 EXHIBIT A ADMINISTRATIVE BUDGET FOR THE PERIOD JULY 1, 2025 THROUGH JUNE 30, 2026 [behind this page] 3 466 Direct Personnel Costs City Manager/Executive Director Assistant City Manager City Council/Successor Agency Board Members City Clerk/Board Clerk Assistant City Clerk City Attorney Chief Assistant City Attorney City Treasurer Chief Financial Officer Assistant Chief Financial Officer Finance Manager Treasury Finance Manager Accounting Principal Finance Analyst Senior Accountant Accounting Technician Payroll Specialist Community Development Director Deputy Director of Community Development Economic Development Project Manager Total Direct Personnel Costs Indirect Costs (applied at .5% of total cost) General Liability Insurance Workers Compensation Insurance Facilities Maintenance and Utilities Computer Maintenance General and Office Supplies Legal -City Attorney Human Resources information Services Total Indirect Cost City of Huntington Beach FY 2025/26 Administrative Allowance Budget Fiscal Year 2025/2026 ~ Depal1ment City Manager $ 465,114 $ City Manager 428,777 City Council 94,760 City Clerk 228,099 City Clerk 147,828 City Attorney 453,999 City Attorney 326,838 Finance 184,874 Finance 322,921 Finance 269,565 Finance 189,009 Finance 213,823 Finance 184,609 Finance 143,882 Finance 91,382 Finance 125,774 Community Development 189,152 Community Development 274,559 Economic Development 174,184 14,558,195 11,868,717 10,052,709 4,230,465 3,315,760 4,252,769 2,864,232 8,450,864 Hourly Rate 223.61 206.14 45.56 109.66 71.07 218.27 157.13 88.88 155.25 129.60 90.87 102.80 88.75 69.17 43.93 60.47 90.94 132.00 83.74 Total Successor Agency Admin Allowance Cost Total Successor Agency FY 2024/25 Proposed Admin Budget % of Time Successor !l8. SQent on SA Agency Hours Administration Issues 21 $ 4,651 1.00% 21 4,288 1.00% 4 190 0.20% 4 456 0.20% 4 296 0.20% 20 4,365 0.96% 20 3,143 0.96% 36 3,200 1.73% 125 19,375 6.00% 30 3,888 1.44% 60 5,452 2.88% 120 12,336 5.77% 144 12,781 6.92% 120 8,301 5.77% 21 914 1.00% 120 7,256 5.77% 104 9,458 5.00% 146 19,219 7.00% 120 10,049 5.77% 129,617 72,791 59,344 50,264 21,152 16,579 21,264 14,321 27,122 282,837 $ 412,453 $ 250,000 467 HRG DATE/TIME UDGE SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO February 17, 2023 / 2:00 P.M. DEPT. NO. James P. Arguelles CLERK 32 Ward City of Huntington Beach, a California charter city, et Case No.: 34-2018-80002876 al., Petitioners/Plaintiffs, v. Edmund G. Brown, Jr., individually and in his official capacity as Governor of the State of California, et al., Respondents/Defendants. Nature of Proceedings: Amended Petition for Writ of Mandamus; Motion to Strike - Combined Final Ruling The petition after remand is GRANTED, and a writ of mandate shall issue directing Respondent Department of Finance (DOF) to treat the Waterfront Loan on Petitioner City of Huntington Beach as Successor Agency's (Successor Agency) Recognized Obligation Payment Schedule (ROPS) for the period July 2017 through July 2018 as an enforceable obligation. The motion to strike is GRANTED. Petitioners' request for judicial notice is unopposed and GRANTED. The documentation attached by exhibit to Petitioners' reply brief is stricken as Respondent has not had the opportunity to respond. Introduction On May 25, 2022, the Court entered a judgment in this case granting in part and denying in part the First.Amended Petition and Complaint (Petition) of petitioners City of Huntington Beach (City), the Successor Agency to the Dissolved Huntington Beach Redevelopment Agency (Former RDA), and the City of Huntington Beach Housing Authority (collectively "Petitioners"). Pursuant to the judgment, the Court issued a writ of mandate commanding DOF, among other .... Page 1 of 8 468 things, to reconsider whether the so-called Waterfront Loan Agreement ("Waterfront Loan" or "Agreement") between the City and the Former RDA constituted an "enforceable obligation" pursuant to the Dissolution Law in the Health and Safety Code.1 DOF had determined that the Waterfront Loan was not an enforceable obligation, but the Court rejected DOF's rationale. The Court remanded for DOF to decide whether the Waterfront Loan contained a genuine obligation "to pay," which is required for it to qualify as an enforceable loan agreement. On remand, Petitioners tendered new documentation in an attempt demonstrate that the Waterfront Loan was an enforceable loan agreement. DOF once again determined that the Waterfront Loan was not enforceable. Petitioners now ask the Court to issue a further writ of mandate directing DOF to treat the Waterfront Loan as an enforceable obligation supporting the allocation of tax revenues. DOF ,.opposes. In addition, DOF moves for an order striking from the administrative record on remand certain financial records that Petitioners have provided to the Court but failed to provide to DOF below. Factual and Procedural Background As previously detailed in the Court's April 21, 2022 final merits ruling, the Waterfront Loan is memorialized in a written agreement between the City and the Former RDA. This document, executed in 1988, describes the City's sale of real property to the Former RDA for a price of $22.4 million. The property is located within the "Main-Pier Project Area," and the transfer was made to facilitate development within this area. The City deeded the property to the Former RDA in 1989. Subject to the City granting an extension, the Former RDA was required to repay the loan in 1988. The written agreement provides: This Agreement constitutes an indebtedness of the [Former RDA] incurred in carrying out the Project and a pledging of the tax allocations from the project to repay such indebtedness ... provided, however, that such pledge of tax allocations shall always be subordinate and subject to the right of the [Former RDA] to pledge or commit tax allocations from the Project to repay bonds or other indebtedness incurred by the [Former RDA] in carrying out the Project. In 1988, the City granted the Former RDA an extension of undefined duration, and the extension triggered a 10-percent interest rate. Under the Dissolution Law, the Successor Agency received a finding of completion in May 2014. In 2017, the Successor Agency's oversight board issued resolutions finding that the Waterfront 1 In its final merits ruling dated April 21, 2022, the Court examined the Dissolution Law in some detail. For the sake of brevity, the Court does not reprint that examination here and instead incorporates its April 21, 2022 final merits ruling by reference. Page 2 of 8 469 Loan had been made for legitimate redevelopment purposes, and that the loan was an enforceable obligation. The Successor Agency then tendered its ROPS 17-18. The Successor Agency provided DOF with financial records showing that between 1989 and 2011, the Former RDA made payments on various City loans, and that $14.78 million of these payments were the Waterfront Loan's pro rata share. DOF objected to the Waterfront Loan. After meeting and conferring with the City, DOF formally disapproved the Waterfront Loan. Petitioners then filed this action and sought, among other things, a writ of mandate directing DOF to treat the Waterfront Loan as an enforceable obligation. As noted above, the Court remanded for DOF to decide whether the Waterfront Loan contained a genuine obligation to pay. (See Health & Safety Code§ 34191.4, subd. (b)(2)(B) [enforceable loan agreements include transfers of real property interests from a sponsor entity to a redevelopment agency provided that redevelopment agency was "obligated to pay ... for the real property interest"].)2 On May 25, 2022, the City provided DOF with additional documentation in an attempt to demonstrate that the Waterfront Loan had to be repaid by a date certain. On August 24, 2022, DOF determined once again that the Waterfront Loan was not an enforceable obligation. DOF proffered three grounds for the determination: 1) the Agreement is unenforceable because it allows the Former RDA to make payments in perpetuity, if at all, and thus does not create an actual obligation to pay; 2) the City's additional documentation does not contain the sort of evidence that the Court indicated was relevant; and 3) although legislation post-dating the Waterfront Loan imposed deadlines for redevelopment agencies to pay on debt and make final payments, the legislation does not affect the Former RDA's contractual right to limit or avoid repayment. (See Exh. A to DOF's Return to Writ of Mandate, p. 2.) This proceeding for a further writ of mandate followed. Standards of Review The Court reviews DOF's treatment of items on a ROPS pursuant to Code of Civil Procedure Section 1085. '"A traditional writ of mandate under Code of Civil Procedure section 1085 is a method for compelling a public entity to perform a legal and usually ministerial duty."' (Vallejo Police Officers Assn. v. City of Vallejo (2017) 15 Cal.App.5th 601, 611.) Ordinary mandate is used to review an adjudicatory decision when an agency is not required to hold an evidentiary hearing. [Citation.] The scope of review is limited, out of deference to the agency's authority and presumed expertise: "The court may not reweigh the evidence or substitute its judgment for that of the agency. [Citation.] ... 'A court will uphold the agency action unless the action is arbitrary, capricious, or lacking in evidentiary support."' 2 Undesignated statutory references shall be to the Health and Safety Code. Page 3 of 8 470 (Stone v. Regents of Univ. of Co/if. (1999) 77 Cal.App.4th 736, 745.) While the court accords "weak deference" to an agency's statutory interpretation of its governing statutes "where its expertise gives it superior qualifications to do so," the issue is ultimately subject to de novo review. (City of Brentwod v. Campbell (2015) 237 Cal.App.4th 488, 500.) Discussion The Motion to Strike The supplemental administrative record that Petitioner lodged in this proceeding after remand includes the Former RDA's financial statements for 1988 and 1989. (Supp. AR 62-84; 89-116.) Petitioners did not tender these documents for DOF's consideration before DOF it issued its August 24, 2022 decision. (See Exh. B to Ferrari Deel., 'II 4.) Accordingly, DOF moves the Court to strike these statements from the supplemental administrative record. In their reply brief on the merits, Petitioners argue, not that they provided DOF with the disputed documents, but that the documents simply convey information that Petitioners had previously submitted to DOF, i.e., before the Court remanded for further proceedings on the Waterfront Loan. The administrative record before the Court when it issued its April 21, 2022 merits ruling, which presumably includes the documents that Petitioners submitted to DOF originally, is no longer in the Court's possession. The Court declines to consider extra-record evidence that was not presented to DOF. (See Golden Drugs Co., Inc. v. Maxwell-Jolly (2009) 179 Cal.4th 1455, 1468-70.) DOF's motion to strike Exhibits 3 and 5 from the supplemental administrative record is granted. In any event, and consistent with the analysis below, even if the Court were to consider the financial statements in question, it would not alter the outcome. Petitioners tender the financial statements to establish that the Former RDA lacked sufficient tax revenue to pay the $22.4 million debt in 1988, and that the City effectively granted the Former RDA an extension to repay the loan. The Court, however, determined in its April 21, 2022 ruling that the Former RDA had received an extension. Therefore, neither the extension nor the need for it are currently at issue. The Enforceability of Waterfront Loan The principal question before the Court is whether, notwithstanding that the Agreement contains no repayment deadline and subordinates the Former RDA's pledge of Main-Pier Project tax revenues to repayment of other debts supporting the Main-Pier Project, the Agreement nonetheless obligated the Former RDA "to pay" pursuant to Section 34191.4, subdivision (b)(2)(B). In its April 21, 2022 merits ruling, the Court expressed the view that the existence of a genuine obligation to pay turned in part on whether the Agreement allowed for payments into perpetuity. In turn, the Court indicated that whether the Agreement allowed for perpetual payments depended on the ratio between Main-Pier Projecttax allocations and other Page 4 of8 471 Main-Pier Project indebtedness. The Court tendered this ratio on the theory that, even though the Agreement does not express a repayment deadline, perhaps if the parties understood how much tax increment revenue would remain available to the Former RDA periodically after it paid its other project debts, they could have reached a tacit understanding about the likely deadline on repayment. The Court agrees with DOF that the documents submitted for DOF's consideration on remand do not provide any insight into this ratio. Nor do the documents establish that the Agreement requires the Former RDA to repay the loan in any amount at any time. Based on its further review of the express terms of the Dissolution Law, however, the Court concludes that the Legislature intended for the Agreement to qualify as an enforceable loan for the transfer of real property. "'The fundamental objective of statutory interpretation is to determine the Legislature's intent."' {City of Ooklond v. Deportment of Finance (2022) Cal.App.5th 79 431, 443-444.) The Court begins with the statutory text, which is the best indicator of legislative intent. (See Son Diegans far Open Gov't v. Public Facilities Financing Auth. of City of San Diego (2019) 8 Cal.5th 733, 740.) The Court considers a provision of a statute within the context of the statute and the statutory scheme of which it is a part. (See City of Petaluma v. Cohen (2015) 238 Cal.App.4th 1430, 1440.) If the text is clear, then there is nothing to construe, and the Court's inquiry ends. (See Lopez v. Sony Electronics, Inc. {2018} 5 Cal.5th 627, 634.) If the text is ambiguous, then the Court consults a variety of extrinsic aids, including "the ostensible objects to be achieved, the evils to be remedied, the legislative history, [and] public policy[.]" (Bitner v. Department of Corrections & Rehab. (2023) 87 Cal.App.5th 1048, 1058.) Section 34191.4, subdivision (b)(2)(B) predicates an enforceable loan for real property upon the redevelopment agency's obligation to pay. Because the Dissolution Law does not define the terms "obligate" or "to pay," the Court applies commonly understood meanings. The word "obligate" means "[t]o bind by legal or moral duty." (See Black's Law Diet. (7th ed. 1999) p. 1101, col. 2.) The verb "to pay" means to give in return for°goods or services, or to discharge a debt. {See Webster's 3d New lnternat. Diet. (1986) p. 1659.) The Agreement contains terms consistent with these definitions. It identifies $22.4 million as the price for the real property, as well as a 10-percent annual interest rate if not paid in 1988. In addition, the Agreement contains the Former RDA's pledge of project tax allocations to repay the loan. The Redevelopment Law contemplated pledges of this kind. (See § 33671 [authorizing redevelopment agencies to pledge of tax increment funds to repay loans]; see also § 33671.5 ["Whenever any redevelopment agency is authorized to, and does, expressly pledge taxes allocated ... to secure, directly or indirectly, the obligations of the agency ... then that pledge ... shall have priority over any other claim to those taxes not secured by a prior express pledge of those taxes"].) Both DOF and the Court have expressed concern about the subordination provisions attached to the Former RDA's pledge in the Agreement. The pledge was made "always ... subordinate Page 5 of 8 472 and subject to the right of the [Former RDA) to pledge or commit tax allocations from the Project to repay bonds or other indebtedness incurred by the [Former RDA) in carrying out the Project." Coupled with the lack of any schedule requiring payment of specific sums at specific points in time, this qualifying language raises the prospect that the Former RDA could simply pay de miminis amounts, or pay nothing at all, into perpetuity. Several things temper concerns that the Agreement contains an insufficient payment obligation. First, as the Court pointed out in its April 21, 2022 merits ruling, the implied covenant of good faith and fair dealing prevented the Former RDA from incurring additional debt on the Main- Pier Project solely to avoid paying down the Waterfront Loan. Hence, the Former RDA did not have unbridled discretion to ignore its payment obligation and associated pledge of tax increment under the Agreement. Second, section 34191.4, subdivision (b) accounts for loans with large amounts of accumulated interest as well as loans lacking reasonable repayment deadlines. Subdivision (b)(3) reads, in relevant part: If the oversight board finds that the loan is an enforceable obligation, any interest on the remaining principal amount of the loan that was previously unpaid after the original effective date of the loan shall be recalculated from the date of origination of the loan as approved by the redevelopment agency on a quarterly basis, at a simple interest rate of 3 percent. The recalculated loan shall be repaid to the city ... in accordance with a defined schedule over a reasonable term of years. Moneys repaid shall be applied first to the principal, and second to the interest. If the Legislature had meant to exclude as unenforceable loans lopsided by unpaid interest, or loans without reasonable payment deadlines, then it would not have provided for the recalculation of interest or the imposition of a reasonable deadline. Third, the obligation to pay in section 34191.4, subdivision (b)(2)B) stands in contrast with requirements for other enforceable obligations under the Dissolution Law. Subdivision (b)(2)(A) of the same section defines loan agreements not involving transfers of interests in real property. These loans must include an obligation to pay "pursuant to a required repayment schedule." Although the statute does not define the term "repayment schedule" as used in this subdivision, is clearly denotes specified sums owed at specified points in time. (Cf. § 34171, subd. (h) ["Recognized Obligation Payment Schedule" means a documents setting forth minimum payments and corresponding due dates].) The omission of the term "repayment schedule" in subdivision (b)(2)(B) reflects a legislative decision to treat loans for interests in real property differently than other loans. And it specifically reflects an intent not to require payments of particular amounts at particular times as necessary to establish an enforceable loan for real property. The definition of enforceable "loans for money" under section 34171, subdivision (d)(l)(B) also sheds some light. This subdivision is part of the definition of "enforceable obligation" whether Page 6 of 8 473 or not the successor agency has obtained a finding of completion. Subdivision (d)(l)(B) extends enforceable obligations to "[l]oans for money borrowed by the redevelopment agency for a lawful purpose, to the extent they are legally required to be repaid pursuant to a required repayment schedule or other mandatory laan terms." (Emphasis added.)3 The Legislature was aware of this language when it subsequently enacted section 34191.4. (See Fermina v. ·Fedco, Inc. (1994) 7 Cal.4th 701, 720.) Mandatory loan terms include the terms of repayment. (See City of Grass Valley v. Cohen (2017) 17 Cal.App.5th 567, 583.) Yet, when the Legislature enacted section 34191.4, subdivision (b)(2)(B), it did not require a repayment deadline. "Ordinarily, where the Legislature uses a different word or phrase in one part of a statute than it does in other sections or in a similar statute concerning a related subject, it must be presumed that the Legislature intended a different meaning." (Campbell v, Zolin (1995) 33 Cal.App.4th 489, 497 .) Instead, section 34191.4, subdivision (b)(2)(B) requires the former redevelopment agency to possess an obligation "to pay." The Agreement contains the Former RDA's pledge of project tax increment to pay the $22.4 million purchase price. Although this pledge was made subject to other project indebtedness, it secured the Former RDA's obligation "to pay." The Court does not believe that more was required to establish an obligation within the purview of section 34191.4, subdivision (b)(2)(B). As a result, the Agreement contains an obligation to pay, and DOF should have treated it as an enforceable obligation when the Successor Agency submitted its ROPS 17-18. Disposition The petition after remand is granted, and a writ of mandate shall issue directing DOF to treat the Waterfront Loan on the Successor Agency's ROPS 17-18 as an. enforceable obligation. DOF shall file a return no later than 60 days after the writ issues. The motion to strike is granted. Pursuant to C.R.C. 3.1312, counsel for Petitioners shall serve and then lodge (1) for the Court's signature an amended judgment to which this ruling is attached as Exhibit A and the April 21, Ill 3 These provisions do not apply to loans that a sponsor entity made to its redevelopment agency. (See§ 34171, subd. {d)(2).) Page 7 of 8 474 2022 ruling is attached as Exhibit B, and (2) for the clerk's signature a writ of mandate. Unless otherwise ordered, any administrative record, exhibit, deposition, or other original document offered in evidence or otherwise presented at trial, will be returned at the conclusion of the matter to the custody of the offering party. The custodial party must maintain the administrative record and all exhibits and other materials in the same condition as received from the clerk until 60 days after a final judgment or dismissal of the entire case is entered. SO ORDERED. Dated: February 27, 2023 Page 8 of8 uperior Court Judge un y o acramento Transmitted via e-mail REVISED May 19, 2023 Sunny Rief, Assistant Chief Financial Officer City of Huntington Beach 2000 Main Street Huntington Beach, CA 92648 Subject: 2017-18 Recognized Obligation Payment Schedule This letter supersedes the California Department of Finance’s (Finance) April 10, 2017, May 17, 2017, November 14, 2017, and August 24, 2022 Recognized Obligation Payment Schedule (ROPS) determination letters for the period of July 1, 2017 through June 30, 2018 (ROPS 17-18), with respect to Item Number 88 only. A revision to the City of Huntington Beach Successor Agency’s (Agency) ROPS 17-18 determination letters is necessary to comply with the judgment in the matter of City of Huntington Beach et al. v. State of California et al. (Case No. 34-2018-80002876) (Judgment). Pursuant to the February 17, 2023 Judgment, Finance makes the following determination: •Item No. 88 – Waterfront Commercial Master Site Plan. Finance no longer denies this item. In compliance with the Judgement, the Agreement for the Purchase and Sale of Property (Waterfront Loan) dated September 19, 1988 between the City and the former Redevelopment Agency of the City of Huntington Beach is considered an enforceable obligation, and future requests for funding of supported outstanding amounts will be allowable. All other previous determinations made in Finance’s April 10, 2017, May 17, 2017, November 14, 2017, and August 24, 2022 ROPS 17-18 determination letters stand. 475 ~t-lT 0~ ,t-• ,,,.. t .. "1, : 'iiiiiii' i \JI 0 0 ,,, • DEPARTMENT OF Gavin Newsom ■ Governor ◊ .. l,.-a""''"flNANCE ___________ 9_l_S_L_S _tr_e_e_t _■_S_o_c_r_o_m_e_n_t_o_C_A_■-95_8_1_4 ___ 37_0_6_■_w_w_w ___ d _o_f _-c-o-.g-o-v Sunny Rief May 19, 2023 Page 2 Please direct inquiries to Chikako Takagi-Galamba, Manager at (916) 322-2985. Sincerely, JENNIFER WHITAKER Program Budget Manager cc: Ursula Luna-Reynosa, Director of Community Development, City of Huntington Beach Christopher Ranftl, Administrative Manager I, Property Tax Unit, Orange County Kathy Tavoularis, Countywide Oversight Board Representative 476 ROPS II July thru December 2012 ROPS III January thru June 2013 Total For Base Year 740,249 853,341 1,593,590 ROPS 24-25A July thru December 2024 ROPS 24-25B January thru June 2025 Total For Comparison Year 9,649,135 8,821,251 18,470,386 A 18,470,386 B 1,593,590 A-B 16,876,796 ÷2 8,438,398 Formula fields, no input required. Input fields (amounts from County Auditor-Controller RPTTF Distribution Report) Total Residual Balance for Comparison Year Total Residual Balance for Base Year Difference of Residual Balance Divide Difference by two Maximum Repayment Amount Authorized Per Fiscal Year Note: This is a tool provided by Finance to assist successor agencies in determining the maximum repayment amount per authorized fiscal year. Placing this amount on the ROPS does not automatically guarantee approval of the repayment amount. Sponsoring Entity Loan Repayment Calculator Base Year: Total Residual Balance Comparison Year: Total Residual Balance 0nn I Orange County Auditor-Controller July 2012 to December 2012 - ROPS II RPTTF Beginning Balance Deposits: Secured Property Tax Increment Public Utility Property Tax Increment Supplemental Property Tax Increment Unsecured Property Tax Increment Miscellaneous Revenues (Bond Debt Increment & Interest) Deposit totals RPTTF Available Balance H&S Code 34183 Distributions Total County Admin Fees Total Pass-Through RPTTF Available for ROPS ROPS Enforceable Obligations Payable from Property Taxes Successor Agency Administrative Cost Allowance (ACA) Less: Carryover Property Tax Revenue From 7/1/11 - 1/31/12 after 4/15/12 ROPS Total ROPS and ACA (If negative, then 0) Total Maximum ROPS Distribution SCO Invoices for Audit and Oversight H&S Code 34183 Dist Totals Residual Balance AB1484 True Up of ROPS I Calculation: RPTTF Available for 7/1/12 to 12/31/12 ROPS Less: 7/1/12 to 12/31/12 ROPS Enforceable Obligations Payable from Property Taxes Less: Successor Agency Administrative Cost Allowance (ACA) Residual Balance from 7/1/12 to 12/31/12 Period Tax Increment Allocated to RDAs from 7/1/11 to 1/31/12 Less: ROPS Approved for 1/1/12 to 6/30/12 Residual Balance from 1/1/12 to 6/30/12 Period Residual Balance from 7/1/12 to 12/31/12 Period Residual Balance from 1/1/12 to 6/30/12 Period Less: Residual Distributed to Affected Taxing Entities in June 2012 Residual Balance Remaining to be Paid to Affected Taxing Entities Successor Agency Successor Agency Successor Agency Successor Agency Successor Agency Successor Agency Successor Agency for for for for for for for Garden Grove Huntington Beach Irvine La Habra La Palma Lake Forest Mission Viejo -$ -$ -$ -$ -$ -$ -$ 9,999,853 6,164,806 3,194,193 1,210,869 1,216,384 2,914,554 - - - - - - - - - - - - - - - - - - - - - - - - 9,999,853 6,164,806 3,194,193 1,210,869 1,216,384 - 2,914,554 9,999,853 6,164,806 3,194,193 1,210,869 1,216,384 - 2,914,554 256,920 179,239 66,600 33,917 33,547 - 77,110 3,396,468 1,816,732 638,839 210,506 217,654 - 1,666,258 6,346,465 4,168,835 2,488,754 966,446 965,183 - 1,171,186 11,567,900 5,580,531 898,596 1,153,265 337,193 701,234 2,126,338 347,037 167,416 258,036 175,133 233,735 155,000 11,911,555 1,369,715 835,055 533,120 1,454,805 3,382 4,378,232 321,577 1,328,398 37,808 701,234 826,533 3,382 3,428,586 321,577 966,446 37,808 - 826,533 3,656,770 5,424,557 1,027,016 1,210,869 289,009 - 2,569,901 6,343,083 740,249 2,167,177 - 927,375 - 344,653 Residual Residual Residual Residual 6,346,465 4,168,835 2,488,754 965,183 1,171,186 (11,567,900) (5,580,531) (898,596) (337,193) (2,126,338) (347,037) (167,416) (258,036) (233,735) (155,000) (5,568,472) (1,579,112) 1,332,122 394,255 (1,110,152) 16,272,451 8,889,565 3,312,374 1,683,817 1,632,358 - 4,104,769 4,360,896 7,519,850 2,356,439 1,896,840 940,363 1,026,377 1,113,221 11,911,555 1,369,715 955,935 (213,023) 691,995 (1,026,377) 2,991,548 (5,568,472) (1,579,112) 1,332,122 394,255 (1,110,152) 11,911,555 1,369,715 955,935 691,995 2,991,548 (6,343,083) (740,249) (2,167,177) (927,375) (344,653) 5,568,472 629,466 120,880 - 158,875 - 2,646,895 478 4/19/2013 2:37 PM Recognized Obligation Payment Schedule (ROPS) (Report all Values in Whole Dollars) Title of Former Redevelopment Agency (RDA): Countywide Totals ANAHEIM RDA BREA RDA BUENA PARK RDA COSTA MESA RDA CYPRESS RDA FOUNTAIN VALLEY RDA FULLERTON RDA GARDEN GROVE RDA HUNTINGTON BEACH RDA IRVINE RDA Secured & Unsecured Property Tax Increment (TI)242,159,564 29,157,700 18,724,456 14,999,664 2,354,615 3,671,432 5,425,008 10,221,992 14,561,949 9,079,553 3,332,039 Supplemental & Unitary Property TI - Interest Earnings/Other - Penalty Assessments - Total Deposits 242,159,564 29,157,700 18,724,456 14,999,664 2,354,615 3,671,432 5,425,008 10,221,992 14,561,949 9,079,553 3,332,039 Administrative Fees to County Auditor-Controller 398,739 36,291 24,447 27,752 12,461 9,439 12,390 15,939 18,068 13,609 9,596 SB 2557 Administration Fees - SCO Invoices for Audit and Oversight - Total Administrative Distributions 398,739 36,291 24,447 27,752 12,461 9,439 12,390 15,939 18,068 13,609 9,596 City Passthrough Payments 2,195,007 173,133 23,360 222,084 10,552 62,731 106,335 126,428 165,956 10,343 County Passthrough Payments 5,040,420 312,676 345,435 238,521 161,472 40,230 41,252 118,861 139,512 51,471 Special District Passthrough Payments 7,975,502 517,829 155,454 376,758 380,461 43,221 53,852 229,152 113,117 135,673 K-12 School Passthrough Payments - Tax Portion 3,298,962 414,406 - 472,234 4,993 147,013 173,911 18,968 207,584 155,839 K-12 School Passthrough Payments - Facilities Portion 18,322,074 1,561,336 1,358,527 956,167 434,247 192,509 227,732 1,027,821 418,675 204,067 Community College Passthrough Payments - Tax Portion 707,954 72,146 5,671 78,880 1,553 30,117 28,461 27,008 46,512 31,674 Community College Passthrough Payments - Facilities Portion 3,494,112 236,860 6,268 134,920 28,089 33,288 31,456 40,291 88,414 35,008 County Office of Education - Tax Portion 80,442 8,777 1,330 15,799 330 2,093 2,380 2,235 2,066 8,043 County Office of Education - Facilities Portion 723,052 77,156 5,671 108,636 15,404 8,922 10,147 29,148 18,375 34,290 Education Revenue Augmentation Fund (ERAF)- Total Passthrough Distributions 41,837,526 3,374,319 1,901,716 2,603,999 - 1,037,101 560,124 675,526 1,619,912 1,200,211 666,408 Total Administrative and Passthrough Distributions 42,236,265 3,410,610 1,926,163 2,631,751 12,461 1,046,540 572,514 691,465 1,637,980 1,213,820 676,004 Total RPTTF Balance Available to Fund Enforceable Obligations (EOs)199,923,299 25,747,090 16,798,293 12,367,913 2,342,154 2,624,892 4,852,494 9,530,527 12,923,969 7,865,733 2,656,035 Non-ACA ROPS RPTTF Funding Requested by SA 249,939,547 29,368,046 18,130,944 11,843,728 458,338 2,512,997 1,049,489 14,387,035 14,814,862 11,915,468 18,701,464 ACA Funding Requested by SA 6,572,542 1,069,623 329,586 138,650 125,000 70,279 165,956 175,000 380,364 304,106 224,500 Less Items Denied/Reclassified by Department of Finance (109,003,736) (8,860,028) (60,000)(3,165,862) (67,000) (2,092,176) (196,981) (9,450,468) (475,119) (5,207,182) (18,431,464) Less Prior Period Adjustments Per H&S Section 34186 (a)(22,949,729) (7,084,581) - (3,519,251) - - - (4,947,162) - - - Maximum Authorized Distributions (Total ROPS III RPTTF amount approved by the Department of Finance for Non-ACA and ACA EOs) 124,558,624 14,493,060 18,400,530 5,297,265 516,338 491,100 1,018,464 164,405 14,720,107 7,012,392 494,500 Actual Distributions (Lesser of the total ROPS III RPTTF amount approved by the Department of Finance or the actual amount distributed for Non-ACA and ACA EOs) 119,092,597 14,493,060 16,798,293 5,297,265 516,338 491,100 1,018,464 164,405 12,923,969 7,012,392 494,500 Total Distributions 161,328,861 17,903,670 18,724,456 7,929,016 528,799 1,537,640 1,590,978 855,870 14,561,949 8,226,212 1,170,504 Residual Balance (Total Deposits - Total Distributions)80,830,703 11,254,030 - 7,070,648 1,825,816 2,133,792 3,834,030 9,366,122 - 853,341 2,161,535 Residual Distributions Pursuant to H&S Section 34183(a)(4) (Figures should include the effect of "haircutting" pursuant to H&S Section 34188): Cities 10,239,034 1,219,456.60 818,721.34 276,590.40 196,779.87 518,909.16 1,467,671.48 127,258.60 33,545.89 Counties 5,426,041 769,618.69 418,022.57 156,494.87 121,484.37 266,111.90 569,383.59 48,539.86 166,945.02 Special Districts 8,514,883 1,004,029.43 780,877.49 131,201.43 467,452.13 287,207.69 757,287.20 83,762.26 440,138.07 K-12 Schools 35,202,078 5,404,646.46 3,181,219.85 691,035.32 873,738.08 1,776,460.30 4,353,057.84 373,198.12 947,456.55 Community Colleges 6,494,480 871,128.80 473,461.46 192,629.26 108,894.23 327,460.11 644,699.75 75,893.43 216,278.47 County Office of Education 1,642,375 229,507.83 248,701.70 27,816.91 57,799.51 55,952.92 132,305.58 10,842.55 39,641.49 Total ERAF (Please break out the ERAF amounts into the following categories if this information is readily available):13,221,813 1,755,642.19 1,149,643.59 350,047.81 307,643.81 601,927.93 1,441,716.56 133,846.17 317,529.50 ERAF - K-12 - ERAF - Community Colleges - ERAF - County Offices of Education - Total Residual Distributions (Total Residual Distributions Must Equal the Total Residual Balance)80,740,704 11,254,030 - 7,070,648 1,825,816 2,133,792 3,834,030 9,366,122 - 853,341 2,161,535 Total Residual Distributions to K-14 Schools:56,560,746 8,260,925 - 5,053,027 1,261,529 1,348,076 2,761,801 6,571,780 - 593,780 1,520,906 Percentage of Residual Distributions to K-14 Schools 70.1%73.4%#DIV/0!71.5%69.1%63.2%72.0%70.2%#DIV/0!69.6%70.4% Passthrough Distributions- EO Distributions (Includes approved EOs, Successor Agency's (SAs) administrative cost allowance (ACA), and prior period adjustments, and excludes the above passthrough and non-SA administrative distributions)- RPTTF Distributions (Include all payments made pursuant to Health and Safety Code (H&S) Section 34183. Note that the following distributions are not necessary listed in the priority order required by H&S 34183): RPTTF Deposits (Note that entering the deposits by source is optional): Administrative Distributions- Allocation Period: January 2013 - June 2013 ycc County : 30 - Orange County 479 Recognized Obligation Payment Schedule (ROPS) Redevelopment Property Tax Trust Fund (RPTTF) Distributions (to be completed by County Auditor-Controllers (CACs) All values must be reported in whole dollars. Report Type: Actual Allocation Period: Jul 1 - Dec 31 ROPS Allocation Cycle:2024-25A - 26 County:Orange Successor Agency to Former Redevelopment Agency Line #Description Countywide Totals Anaheim - 07 Brea - 37 Buena Park - 41 Costa Mesa - 76 Cypress - 83 Fountain Valley - 114 Fullerton - 119 Garden Grove - 121 Huntington Beach - 145 Irvine - 155 La Habra - 162 La Palma - 165 1 RPTTF Deposits - Entering the deposits by source is optional.409,327,062 41,119,268 32,595,692 27,451,015 3,427,176 7,103,837 18,573,773 21,399,395 19,343,032 40,183,660 2,680,323 2,065,532 2 Secured & Unsecured Property Tax Increment (TI)0 3 Supplemental & Unitary Property TI 0 4 Penalty Assessment Revenue 0 5 Other-Total Funds Designated for Lake Forest Transferred from Orange County SA 8,439,422 6 Other 0 7 Total RPTTF Deposits (sum of lines 1:6)417,766,484 41,119,268 32,595,692 27,451,015 3,427,176 0 7,103,837 18,573,773 21,399,395 19,343,032 40,183,660 2,680,323 2,065,532 8 Total RPTTF Available to Fund CAC Administrative Costs and Passthroughs 417,766,484 41,119,268 32,595,692 27,451,015 3,427,176 0 7,103,837 18,573,773 21,399,395 19,343,032 40,183,660 2,680,323 2,065,532 9 RPTTF Distributions - Include all payments made pursuant to Health and Safety Code (HSC) Section 34183. Note the following distributions are not necessary listed in the priority order required by HSC 34183. 10 Administrative Distributions: 11 Administrative Fees to CAC 337,808 31,975 25,116 21,479 3,872 5,549 16,739 16,782 19,386 32,608 7,082 1,793 12 SB 2557 Administrative Fees 4,392,247 453,455 306,619 302,974 38,280 78,275 193,461 211,890 193,938 449,954 19,553 20,344 13 SCO invoices for Audit and Oversight - Funding should only be allocated for this purpose when there is sufficient RPTTF to fully fund the approved enforceable obligations as shown on line 39. 0 14 Other 0 15 Total Administrative Distributions (sum of lines 11:14)4,730,055 485,430 331,735 324,453 42,152 0 83,824 210,200 228,672 213,324 482,562 26,635 22,137 16 Passthrough Distributions: 17 City 7,590,761 602,349 856,126 573,670 165,806 470,557 482,826 488,337 120,358 81,729 26,690 18 County 9,978,379 886,358 760,472 606,021 113,750 278,066 276,500 468,580 832,020 45,688 60,116 19 City &/or County - Other 0 0 0 0 0 0 0 0 0 0 0 20 Special Districts 18,719,394 1,365,035 873,092 1,053,306 172,229 340,006 626,330 444,269 2,867,962 81,986 179,728 21 K-12 School - Tax Portion 18,604,592 1,794,923 1,500,875 1,994,768 539,057 1,184,084 49,054 1,260,198 3,619,001 193,819 76,083 22 K-12 School - Facilities Portion 43,703,931 4,918,041 1,965,349 3,008,780 705,879 1,550,522 3,284,749 1,731,462 4,738,969 253,800 99,628 23 K-12 School - Other 0 0 0 0 0 0 0 0 0 0 0 24 Community College - Tax Portion 3,849,028 318,935 305,245 344,404 108,542 192,841 159,819 328,450 684,873 30,796 13,077 25 Community College - Facilities Portion 7,454,636 699,305 337,376 433,166 119,968 213,140 194,364 406,637 756,965 34,038 14,453 26 Community College - Other 0 0 0 0 0 0 0 0 0 0 0 27 County Office of Education - Tax Portion 329,034 29,050 48,424 49,213 5,741 12,357 9,776 10,129 50,190 4,478 2,004 28 County Office of Education - Facilities Portion 1,870,399 207,034 206,439 263,149 24,477 52,681 81,073 60,684 213,967 19,091 8,542 29 County Office of Education - Other 0 30 Education Revenue Augmentation Fund (ERAF)0 31 Other 0 32 Total Passthrough Distributions (sum of lines 17:31)112,100,154 10,821,030 6,853,398 8,326,477 0 0 1,955,449 4,294,254 5,164,491 5,198,746 13,884,305 745,425 480,321 33 Total Administrative and Passthrough Distributions (line 15 plus 32)116,830,209 11,306,460 7,185,133 8,650,930 42,152 0 2,039,273 4,504,454 5,393,163 5,412,070 14,366,867 772,060 502,458 34 Total RPTTF Available to Fund Successor Agency (SA) Enforceable Obligations (EOs) (line 8 minus 33) 300,936,275 29,812,808 25,410,559 18,800,085 3,385,024 0 5,064,564 14,069,319 16,006,232 13,930,962 25,816,793 1,908,263 1,563,074 35 Finance Approved RPTTF for Distribution to SA: 36 Non-Admin EOs 78,349,725 18,366,261 22,500 4,842,981 100,000 6,705,038 8,101,257 4,830,943 6,387,414 214,882 703,614 37 Admin Allowance 1,186,074 253,000 7,750 76,944 0 124,837 125,000 125,000 40,000 32,500 5,000 38 Less Prior Period Adjustments (PPA) (Enter as a negative number)(7,020,662)(4,804,129)0 (58,028)0 (100,888)(284,429)(959,974)(272,345)(3,004)0 39 Total Finance Approved RPTTF for Distribution (sum of lines 36:38)72,515,137 13,815,132 30,250 4,861,897 0 0 100,000 6,728,987 7,941,828 3,995,969 6,155,069 244,378 708,614 40 CAC Distributed ROPS RPTTF 41 Non-Admin EOs 72,362,499 13,815,132 22,500 4,842,981 100,000 6,705,038 7,941,828 3,995,969 6,155,069 214,882 703,614 42 Admin Allowance 243,192 0 7,750 18,916 0 23,949 0 0 0 29,496 5,000 43 Insufficient RPTTF (line 39 minus 44) If there is insufficient RPTTF in "A" period, shortfall will be funded in "B" period, if possible. (90,554)0 0 0 0 0 0 0 0 0 0 0 0 44 Total CAC Distributed RPTTF for SA EOs (line 41 plus 42)72,605,691 13,815,132 30,250 4,861,897 0 0 100,000 6,728,987 7,941,828 3,995,969 6,155,069 244,378 708,614 45 Pension Override/State Water Project Override Revenues pursuant to HSC 34183 (a) (1) (B) 285,858 285,858 46 Other 0 47 Other 0 48 Total ROPS Only RPTTF Balance Available for Distribution to ATEs (line 34 minus 44:47) 228,044,726 15,997,676 25,380,309 13,938,188 3,385,024 0 4,964,564 7,340,332 8,064,404 9,649,135 19,661,724 1,663,885 854,460 49 RPTTF Distributions to ATEs: 50 Cities 27,418,482 1,738,158 4,199,899 1,626,736 515,871 670,475 1,159,025 1,470,967 1,603,383 294,454 284,078 106,969 51 Counties 13,361,867 1,096,824 1,426,276 831,091 229,004 270,645 449,652 420,172 557,189 1,170,658 89,069 45,605 52 Special Districts 25,783,205 1,304,635 2,040,599 1,466,984 294,412 412,887 552,574 779,563 680,546 4,035,185 127,591 149,920 53 K-12 Schools 100,825,602 7,782,575 10,745,687 6,292,847 1,284,813 2,336,895 3,424,880 3,377,501 4,275,094 8,793,658 754,174 333,856 54 Community Colleges 18,685,131 1,241,675 1,645,883 941,226 358,147 423,106 509,120 589,489 871,162 2,028,868 100,839 51,641 55 County Office of Education 4,721,960 327,091 883,758 494,216 51,721 70,606 105,532 119,489 124,560 371,705 44,890 27,049 56 Total ERAF - Please break out the ERAF amounts into the following categories, if possible (sum of lines 57:59) 37,248,479 2,506,718 4,438,207 2,285,088 651,056 0 779,950 1,139,549 1,307,223 1,537,201 2,967,196 263,244 139,420 57 ERAF - K-12 0 58 ERAF - Community Colleges 0 59 ERAF - County Offices of Education 0 60 Total RPTTF Distributions to ATEs (sum of lines 50:56) - Total residual distributions must equal total residual balance as shown on line 48. 228,044,726 15,997,676 25,380,309 13,938,188 3,385,024 0 4,964,564 7,340,332 8,064,404 9,649,135 19,661,724 1,663,885 854,460 61 Total Residual Distributions to K-14 Schools (sum of lines 53:56)161,481,172 11,858,059 17,713,535 10,013,377 2,345,737 0 3,610,557 5,179,081 5,393,702 6,808,017 14,161,427 1,163,147 551,966 62 Percentage of K-14 Schools to Residual Distributions (line 61/60)71%74%70%72%69%#DIV/0!73%71%67%71%72%70%65% 63 Comments: Formally dissolved on 01/24/2023 per Countywide Oversight Board Resolution No. 23- 009 Per Settlement Agrmt, a minimum of $4.38M residual should be funded before the judgement amount in the EOs. 480 Recognized Obligation Payment Schedule (ROPS) Redevelopment Property Tax Trust Fund (RPTTF) Distributions (to be completed by County Auditor-Controllers (CACs) All values must be reported in whole dollars. Report Type: Select type Allocation Period: Jan 1 - Jun 30 ROPS Allocation Cycle:2024-25B - 27 County:Orange Successor Agency to Former Redevelopment Agency Line #Description Countywide Totals Anaheim - 07 Brea - 37 Buena Park - 41 Costa Mesa - 76 Cypress - 83 Fountain Valley - 114 Fullerton - 119 Garden Grove - 121 Huntington Beach - 145 Irvine - 155 La Habra - 162 La Palma - 165 1 RPTTF Deposits - Entering the deposits by source is optional.437,069,305 53,691,232 36,627,560 38,337,487 536,839 0 8,765,455 22,348,252 26,466,453 18,683,264 5,162,093 3,840,001 1,840,392 2 Secured & Unsecured Property Tax Increment (TI)0 3 Supplemental & Unitary Property TI 0 4 Penalty Assessment Revenue 0 5 Other - HSC 34187(h) RDA SA Dissolution 83,219,835 3,498,896 54,731,655 6 Other 0 7 Total RPTTF Deposits (sum of lines 1:6)520,289,140 53,691,232 36,627,560 38,337,487 4,035,735 0 8,765,455 22,348,252 26,466,453 18,683,264 59,893,748 3,840,001 1,840,392 8 Total RPTTF Available to Fund CAC Administrative Costs and Passthroughs 520,289,140 53,691,232 36,627,560 38,337,487 4,035,735 0 8,765,455 22,348,252 26,466,453 18,683,264 59,893,748 3,840,001 1,840,392 9 RPTTF Distributions - Include all payments made pursuant to Health and Safety Code (HSC) Section 34183. Note the following distributions are not necessary listed in the priority order required by HSC 34183. 10 Administrative Distributions: 11 Administrative Fees to CAC 460,233 40,489 16,859 18,394 7,647 0 4,256 10,662 13,274 53,348 41,639 135,292 1,009 12 SB 2557 Administrative Fees 0 13 SCO invoices for Audit and Oversight - Funding should only be allocated for this purpose when there is sufficient RPTTF to fully fund the approved enforceable obligations as shown on line 39. 0 14 Other 0 15 Total Administrative Distributions (sum of lines 11:14)460,233 40,489 16,859 18,394 7,647 0 4,256 10,662 13,274 53,348 41,639 135,292 1,009 16 Passthrough Distributions: 17 City 8,424,333 681,214 920,664 765,153 170,561 523,744 527,612 488,000 103,539 28,282 18 County 10,787,012 1,082,374 852,990 773,866 117,532 307,615 323,535 394,942 54,402 71,109 19 City &/or County - Other 0 0 0 0 0 0 0 0 0 0 20 Special Districts 17,728,288 1,706,994 969,809 1,344,396 177,925 375,648 747,735 413,064 108,608 208,186 21 K-12 School - Tax Portion 16,892,304 1,975,585 1,636,167 2,558,384 556,969 1,308,633 53,542 1,253,194 241,237 81,481 22 K-12 School - Facilities Portion 46,630,924 5,761,760 4,142,509 3,854,028 729,334 1,713,615 2,796,664 1,764,895 372,082 106,696 23 K-12 School - Other 0 0 0 0 0 0 0 0 0 0 24 Community College - Tax Portion 3,602,904 350,833 330,758 438,879 112,154 213,377 176,187 329,263 38,441 14,002 25 Community College - Facilities Portion 8,246,531 854,678 365,574 551,865 123,960 235,838 215,405 409,746 42,488 15,476 26 Community College - Other 0 0 0 0 0 0 0 0 0 0 27 County Office of Education - Tax Portion 310,363 32,287 52,483 63,777 5,933 13,711 10,743 10,491 5,617 2,145 28 County Office of Education - Facilities Portion 1,976,226 249,489 223,743 340,757 25,293 58,451 91,409 59,073 23,947 9,146 29 County Office of Education - Other 0 30 Education Revenue Augmentation Fund (ERAF)0 31 Other 0 32 Total Passthrough Distributions (sum of lines 17:31)114,598,885 12,695,214 9,494,697 10,691,105 0 0 2,019,661 4,750,632 4,942,832 5,122,668 0 990,361 536,523 33 Total Administrative and Passthrough Distributions (line 15 plus 32)115,059,118 12,735,703 9,511,556 10,709,499 7,647 0 2,023,917 4,761,294 4,956,106 5,176,016 41,639 1,125,653 537,532 34 Total RPTTF Available to Fund Successor Agency (SA) Enforceable Obligations (EOs) (line 8 minus 33) 405,230,022 40,955,529 27,116,004 27,627,988 4,028,088 0 6,741,538 17,586,958 21,510,347 13,507,248 59,852,109 2,714,348 1,302,860 35 Finance Approved RPTTF for Distribution to SA: 36 Non-Admin EOs 64,684,740 18,401,564 13,450,452 711,500 0 0 0 3,915,975 3,421,805 4,284,890 0 211,256 0 37 Admin Allowance 980,792 253,000 7,750 76,944 0 0 0 124,837 51,165 125,000 0 32,500 5,000 38 Less Prior Period Adjustments (PPA) (Enter as a negative number)(29,178) 39 Total Finance Approved RPTTF for Distribution (sum of lines 36:38)65,636,354 18,654,564 13,458,202 788,444 0 0 0 4,040,812 3,472,970 4,409,890 0 243,756 5,000 40 CAC Distributed ROPS RPTTF 41 Non-Admin EOs 64,599,186 18,401,564 13,450,452 711,500 0 0 0 3,915,975 3,421,805 4,284,890 0 211,256 0 42 Admin Allowance 946,614 253,000 7,750 76,944 0 0 0 124,837 51,165 125,000 0 32,500 5,000 43 Insufficient RPTTF (See line 43 in "A" ROPS) Insufficient RPTTF in "A" Period for Finance Approved RPTTF to be Funded in "B" Period 0 44 Total CAC Distributed RPTTF for SA EOs (sum of lines 41:43)65,545,800 18,654,564 13,458,202 788,444 0 0 0 4,040,812 3,472,970 4,409,890 0 243,756 5,000 45 Pension Override/State Water Project Override Revenues pursuant to HSC 34183 (a) (1) (B) 276,107 276,107 46 Other 0 47 Other 0 48 Total ROPS Only RPTTF Balance Available for Distribution to ATEs (line 34 minus 44:47) 339,408,115 22,300,965 13,657,802 26,839,544 4,028,088 0 6,741,538 13,546,146 18,037,377 8,821,251 59,852,109 2,470,592 1,297,860 49 RPTTF Distributions to ATEs: 50 Cities 37,131,106 2,423,482 2,260,390 3,134,851 614,135 910,459 2,140,207 3,290,291 1,466,952 891,293 422,988 162,515 51 Counties 20,227,760 1,529,301 767,703 1,601,832 272,466 367,516 830,306 939,817 509,814 3,561,253 132,622 69,283 52 Special Districts 41,314,500 1,821,153 1,098,349 2,825,115 350,495 560,599 1,017,346 1,741,979 621,406 12,267,336 189,947 227,717 53 K-12 Schools 150,075,019 10,848,101 5,781,672 12,107,235 1,528,654 3,173,435 6,318,452 7,554,862 3,904,933 26,804,410 1,115,144 507,007 54 Community Colleges 28,595,747 1,731,299 885,624 1,814,066 426,119 574,549 940,120 1,319,293 797,097 6,167,454 150,148 78,450 55 County Office of Education 6,832,458 453,248 475,405 952,404 61,537 95,874 195,310 267,279 114,054 1,130,056 67,782 41,090 56 Total ERAF - Please break out the ERAF amounts into the following categories, if possible (sum of lines 57:59) 55,231,525 3,494,381 2,388,659 4,404,041 774,682 1,059,106 2,104,405 2,923,856 1,406,995 9,030,307 391,961 211,798 57 ERAF - K-12 0 58 ERAF - Community Colleges 0 59 ERAF - County Offices of Education 0 60 Total RPTTF Distributions to ATEs (sum of lines 50:56) - Total residual distributions must equal total residual balance as shown on line 48. 339,408,115 22,300,965 13,657,802 26,839,544 4,028,088 0 6,741,538 13,546,146 18,037,377 8,821,251 59,852,109 2,470,592 1,297,860 61 Total Residual Distributions to K-14 Schools (sum of lines 53:56)240,734,749 16,527,029 9,531,360 19,277,746 2,790,992 0 4,902,964 9,558,287 12,065,290 6,223,079 43,132,227 1,725,035 838,345 62 Percentage of K-14 Schools to Residual Distributions (line 61/60)71%74%70%72%69%#DIV/0!73%71%67%71%72%70%65% 63 Comments: Formally dissolved on 09/17/2024 per Countywide Oversight Board Resolution No. 24-027. Line #1: RPTTF deposits prior to dissolution. Line #5 - Other: Post SA dissolution property tax increment until Assessment Roll 2025/26 per BOE instruction. Formally dissolved on 01/24/2023 per Countywide Oversight Board Resolution No. 23-009. Formally dissolved on 09/17/2024 per Countywide Oversight Board Resolution No. 24-028. Line #1: RPTTF deposits prior to dissolution. Line #5 - Other: Post SA dissolution property tax increment until Assessment Roll 2025/26 per BOE instruction. hvy I I I I I County Name Has the OB Action for the City RDA loan been approved by Finance? Yes Annual ROPS Review Period 25-26 Maximum Repayment Amount Authorized for the FY 21-22 (Positive Number) Quarter Principal Loaned Beginning Outstanding Balance (Principal) Beginning Outstanding Balance (Total) Interest Rate Interest Accrued Ending Outstanding Balance (Total) Amount Repaid (Principal) Amount Repaid (Interest) 7/1/89 22,400,000$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/89 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/90 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 6,672$ 4/1/90 -$ 22,400,000$ 22,897,328$ 3%168,000$ 23,065,328$ -$ -$ 7/1/90 -$ 22,400,000$ 23,065,328$ 3%168,000$ 23,233,328$ -$ -$ 10/1/90 -$ 22,400,000$ 23,233,328$ 3%168,000$ 23,401,328$ -$ -$ 1/1/91 -$ 22,400,000$ 23,401,328$ 3%168,000$ 23,569,328$ -$ 11,407$ 4/1/91 -$ 22,400,000$ 23,557,921$ 3%168,000$ 23,725,921$ -$ -$ 7/1/91 -$ 22,400,000$ 23,725,921$ 3%168,000$ 23,893,921$ -$ -$ 10/1/91 -$ 22,400,000$ 23,893,921$ 3%168,000$ 24,061,921$ -$ -$ 1/1/92 -$ 22,400,000$ 24,061,921$ 3%168,000$ 24,229,921$ -$ 1,997,921$ 4/1/92 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ 7/1/92 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/92 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/93 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 181,678$ 4/1/93 -$ 22,400,000$ 22,722,322$ 3%168,000$ 22,890,322$ -$ -$ 7/1/93 -$ 22,400,000$ 22,890,322$ 3%168,000$ 23,058,322$ -$ -$ 10/1/93 -$ 22,400,000$ 23,058,322$ 3%168,000$ 23,226,322$ -$ -$ 1/1/94 -$ 22,400,000$ 23,226,322$ 3%168,000$ 23,394,322$ -$ 608,831$ 4/1/94 -$ 22,400,000$ 22,785,491$ 3%168,000$ 22,953,491$ -$ -$ 7/1/94 -$ 22,400,000$ 22,953,491$ 3%168,000$ 23,121,491$ -$ -$ 10/1/94 -$ 22,400,000$ 23,121,491$ 3%168,000$ 23,289,491$ -$ -$ 1/1/95 -$ 22,400,000$ 23,289,491$ 3%168,000$ 23,457,491$ -$ 257,413$ 4/1/95 -$ 22,400,000$ 23,200,078$ 3%168,000$ 23,368,078$ -$ -$ 7/1/95 -$ 22,400,000$ 23,368,078$ 3%168,000$ 23,536,078$ -$ -$ 10/1/95 -$ 22,400,000$ 23,536,078$ 3%168,000$ 23,704,078$ -$ -$ 1/1/96 -$ 22,400,000$ 23,704,078$ 3%168,000$ 23,872,078$ -$ 1,640,078$ 4/1/96 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ 7/1/96 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/96 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/97 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 672,000$ 4/1/97 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ 7/1/97 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/97 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/98 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 672,000$ 4/1/98 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ 7/1/98 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/98 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/99 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 73,282$ 4/1/99 -$ 22,400,000$ 22,830,718$ 3%168,000$ 22,998,718$ -$ -$ 7/1/99 -$ 22,400,000$ 22,998,718$ 3%168,000$ 23,166,718$ -$ -$ 10/1/99 -$ 22,400,000$ 23,166,718$ 3%168,000$ 23,334,718$ -$ -$ 1/1/00 -$ 22,400,000$ 23,334,718$ 3%168,000$ 23,502,718$ -$ 100,213$ 4/1/00 -$ 22,400,000$ 23,402,505$ 3%168,000$ 23,570,505$ -$ -$ 7/1/00 -$ 22,400,000$ 23,570,505$ 3%168,000$ 23,738,505$ -$ -$ 10/1/00 -$ 22,400,000$ 23,738,505$ 3%168,000$ 23,906,505$ -$ -$ 1/1/01 -$ 22,400,000$ 23,906,505$ 3%168,000$ 24,074,505$ -$ 93,562$ 4/1/01 -$ 22,400,000$ 23,980,943$ 3%168,000$ 24,148,943$ -$ -$ 7/1/01 -$ 22,400,000$ 24,148,943$ 3%168,000$ 24,316,943$ -$ -$ 10/1/01 -$ 22,400,000$ 24,316,943$ 3%168,000$ 24,484,943$ -$ -$ 1/1/02 -$ 22,400,000$ 24,484,943$ 3%168,000$ 24,652,943$ -$ 248,212$ 4/1/02 -$ 22,400,000$ 24,404,731$ 3%168,000$ 24,572,731$ -$ -$ 7/1/02 -$ 22,400,000$ 24,572,731$ 3%168,000$ 24,740,731$ -$ -$ 10/1/02 -$ 22,400,000$ 24,740,731$ 3%168,000$ 24,908,731$ -$ -$ 1/1/03 -$ 22,400,000$ 24,908,731$ 3%168,000$ 25,076,731$ -$ 2,844,731$ 4/1/03 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ 7/1/03 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/03 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/04 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 672,000$ 4/1/04 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ 7/1/04 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/04 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/05 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 672,000$ 4/1/05 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ 7/1/05 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/05 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/06 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 672,000$ 4/1/06 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ 7/1/06 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/06 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/07 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 672,000$ 4/1/07 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ What type of ROPS are you currently reviewing? LOAN REPAYMENT CALCULATION: Orange Agency Name Huntington Beach OB Action for City Loan ROPS Review Period Residual Calculation Amount 482 7/1/07 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/07 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/08 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 672,000$ 4/1/08 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ 7/1/08 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/08 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/09 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 672,000$ 4/1/09 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ 7/1/09 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/09 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/10 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 672,000$ 4/1/10 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ 7/1/10 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/10 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/11 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ 672,000$ 4/1/11 -$ 22,400,000$ 22,232,000$ 3%168,000$ 22,400,000$ -$ -$ 7/1/11 -$ 22,400,000$ 22,400,000$ 3%168,000$ 22,568,000$ -$ -$ 10/1/11 -$ 22,400,000$ 22,568,000$ 3%168,000$ 22,736,000$ -$ -$ 1/1/12 -$ 22,400,000$ 22,736,000$ 3%168,000$ 22,904,000$ -$ -$ 4/1/12 -$ 22,400,000$ 22,904,000$ 3%168,000$ 23,072,000$ -$ -$ 7/1/12 -$ 22,400,000$ 23,072,000$ 3%168,000$ 23,240,000$ -$ -$ 10/1/12 -$ 22,400,000$ 23,240,000$ 3%168,000$ 23,408,000$ -$ -$ 1/1/13 -$ 22,400,000$ 23,408,000$ 3%168,000$ 23,576,000$ -$ -$ 4/1/13 -$ 22,400,000$ 23,576,000$ 3%168,000$ 23,744,000$ -$ -$ 7/1/13 -$ 22,400,000$ 23,744,000$ 3%168,000$ 23,912,000$ -$ -$ 10/1/13 -$ 22,400,000$ 23,912,000$ 3%168,000$ 24,080,000$ -$ -$ 1/1/14 -$ 22,400,000$ 24,080,000$ 3%168,000$ 24,248,000$ -$ -$ 4/1/14 -$ 22,400,000$ 24,248,000$ 3%168,000$ 24,416,000$ -$ -$ 7/1/14 -$ 22,400,000$ 24,416,000$ 3%168,000$ 24,584,000$ -$ -$ 10/1/14 -$ 22,400,000$ 24,584,000$ 3%168,000$ 24,752,000$ -$ -$ 1/1/15 -$ 22,400,000$ 24,752,000$ 3%168,000$ 24,920,000$ -$ -$ 4/1/15 -$ 22,400,000$ 24,920,000$ 3%168,000$ 25,088,000$ -$ -$ 7/1/15 -$ 22,400,000$ 25,088,000$ 3%168,000$ 25,256,000$ -$ -$ 10/1/15 -$ 22,400,000$ 25,256,000$ 3%168,000$ 25,424,000$ -$ -$ 1/1/16 -$ 22,400,000$ 25,424,000$ 3%168,000$ 25,592,000$ -$ -$ 4/1/16 -$ 22,400,000$ 25,592,000$ 3%168,000$ 25,760,000$ -$ -$ 7/1/16 -$ 22,400,000$ 25,760,000$ 3%168,000$ 25,928,000$ -$ -$ 10/1/16 -$ 22,400,000$ 25,928,000$ 3%168,000$ 26,096,000$ -$ -$ 1/1/17 -$ 22,400,000$ 26,096,000$ 3%168,000$ 26,264,000$ -$ -$ 4/1/17 -$ 22,400,000$ 26,264,000$ 3%168,000$ 26,432,000$ -$ -$ 7/1/17 -$ 22,400,000$ 26,432,000$ 3%168,000$ 26,600,000$ -$ -$ 10/1/17 -$ 22,400,000$ 26,600,000$ 3%168,000$ 26,768,000$ -$ -$ 1/1/18 -$ 22,400,000$ 26,768,000$ 3%168,000$ 26,936,000$ -$ -$ 4/1/18 -$ 22,400,000$ 26,936,000$ 3%168,000$ 27,104,000$ -$ -$ 7/1/18 -$ 22,400,000$ 27,104,000$ 3%168,000$ 27,272,000$ -$ -$ 10/1/18 -$ 22,400,000$ 27,272,000$ 3%168,000$ 27,440,000$ -$ -$ 1/1/19 -$ 22,400,000$ 27,440,000$ 3%168,000$ 27,608,000$ -$ -$ 4/1/19 -$ 22,400,000$ 27,608,000$ 3%168,000$ 27,776,000$ -$ -$ 7/1/19 -$ 22,400,000$ 27,776,000$ 3%168,000$ 27,944,000$ -$ -$ 10/1/19 -$ 22,400,000$ 27,944,000$ 3%168,000$ 28,112,000$ -$ -$ 1/1/20 -$ 22,400,000$ 28,112,000$ 3%168,000$ 28,280,000$ -$ -$ 4/1/20 -$ 22,400,000$ 28,280,000$ 3%168,000$ 28,448,000$ -$ -$ 7/1/20 -$ 22,400,000$ 28,448,000$ 3%168,000$ 28,616,000$ -$ -$ 10/1/20 -$ 22,400,000$ 28,616,000$ 3%168,000$ 28,784,000$ -$ -$ 1/1/21 -$ 22,400,000$ 28,784,000$ 3%168,000$ 28,952,000$ -$ -$ 4/1/21 -$ 22,400,000$ 28,952,000$ 3%168,000$ 29,120,000$ -$ -$ 7/1/21 -$ 22,400,000$ 29,120,000$ 3%168,000$ 29,288,000$ -$ -$ 10/1/21 -$ 22,400,000$ 29,288,000$ 3%168,000$ 29,456,000$ -$ -$ 1/1/22 -$ 22,400,000$ 29,456,000$ 3%168,000$ 29,624,000$ -$ -$ 4/1/22 -$ 22,400,000$ 29,624,000$ 3%168,000$ 29,792,000$ -$ -$ 7/1/22 -$ 22,400,000$ 29,792,000$ 3%168,000$ 29,960,000$ -$ -$ 10/1/22 -$ 22,400,000$ 29,960,000$ 3%168,000$ 30,128,000$ -$ -$ 1/1/23 -$ 22,400,000$ 30,128,000$ 3%168,000$ 30,296,000$ -$ -$ 4/1/23 -$ 22,400,000$ 30,296,000$ 3%168,000$ 30,464,000$ -$ -$ 7/1/23 -$ 22,400,000$ 30,464,000$ 3%168,000$ 30,632,000$ -$ -$ 10/1/23 -$ 22,400,000$ 30,632,000$ 3%168,000$ 30,800,000$ -$ -$ 1/1/24 -$ 22,400,000$ 30,800,000$ 3%168,000$ 30,968,000$ -$ -$ 4/1/24 -$ 22,400,000$ 30,968,000$ 3%168,000$ 31,136,000$ -$ -$ 7/1/24 -$ 22,400,000$ 31,136,000$ 3%168,000$ 31,304,000$ 4,767,167$ -$ 10/1/24 -$ 17,632,833$ 26,536,833$ 3%132,246$ 26,669,079$ -$ -$ 1/1/25 -$ 17,632,833$ 26,669,079$ 3%132,246$ 26,801,325$ 3,828,541$ -$ 4/1/25 -$ 13,804,292$ 22,972,784$ 3%103,532$ 23,076,317$ -$ -$ 7/1/25 -$ 13,804,292$ 23,076,317$ 3%103,532$ 23,179,849$ -$ -$ 10/1/25 -$ 13,804,292$ 23,179,849$ 3%103,532$ 23,283,381$ -$ -$ 1/1/26 -$ 13,804,292$ 23,283,381$ 3%103,532$ 23,386,913$ -$ -$ 4/1/26 -$ 13,804,292$ 23,386,913$ 3%103,532$ 23,490,445$ -$ -$ 483 Recognized Obligation Payment Schedule (ROPS) FY 2025-26 City Council / Successor Agency Meeting January 21, 2025 484 Recognized Obligation Payment Schedule (ROPS) • The California Supreme Court ruled on the Dissolution Act (AB 1484) to dissolve all Redevelopment Agencies (RDAs) in California effective February 1, 2012. • AB 1484 established procedures for payment of legally enforceable obligation of the former RDAs by establishing Successor Agencies (SAs) through the annual submission of the ROPS to the State Department of Finance (DOF). • The ROPS lists all expenditures required to be paid by the Successor Agency in the upcoming fiscal year. For Fiscal Year 2025-26, this amount is $10,768,498. • The Fiscal Year ROPS also includes a request for $8,438,398 repayment of a loan from the City to the former RDA related to the Waterfront. The payment is required through a judgment issued by the California Supreme Court on February 17, 2023. The DOF concurred with the Court’s ruling in a letter dated May 19, 2023. 485 Recognized Obligation Payment Schedule (ROPS) Waterfront Summary of ROPS- Waterfront $22,400,000 Principal $8,736,000 Interest $31,136,000TOTAL $6,227,200 20% Set-aside requirement $24,908,800General Fund 80% Allocation 486 Recognized Obligation Payment Schedule (ROPS) • Health and Safety Code Section 34179(j) requires the ROPS to be approved by both the Huntington Beach Successor Agency and the Countywide Oversight Board and submitted to the Department of Finance no later than February 1, 2025 in order to receive funding for the Fiscal Year 2025-26. • The ROPS expenditures required to be paid by the Successor Agency in the upcoming fiscal year will be presented to the Orange Countywide Oversight Board for their consideration and approval on January 28, 2025. • The approved ROPS are required to be submitted to the California Department of Finance (DOF) by February 1, 2025. The ROPS are then subject to review and approval by the DOF. • It is recommended that the Successor Agency Adopt Resolution Nos. 2025-01 and 2025-02 approving the Recognized Obligation Payment Schedule (ROPS) and Administrative Budget for the Huntington Beach Successor Agency for the period of July 1, 2025, through June 30, 2026, in accordance with Health and Safety Code Section 34177 and related actions 487 Questions? 488 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:24-797 MEETING DATE:1/21/2025 REQUEST FOR CITY COUNCIL ACTION SUBMITTED TO:Honorable Mayor and City Council Members SUBMITTED BY:Lisa Lane Barnes, City Clerk PREPARED BY:Lisa Lane Barnes, City Clerk Subject: Petition to repeal Ordinance No. 4318 Deleting Huntington Beach Municipal Code Chapter 2.66 - Community-Parent Guardian Review Board for Procurement of Children’s Library Materials, and Adding Section 2.30.090 - Selection and Use of Library Materials Statement of Issue: A citizen initiative petition (Petition) with signatures was submitted to the City Clerk’s Office on October 28, 2024, to repeal Ordinance No. 4318 deleting Huntington Beach Municipal Code Chapter 2.66 - Community-Parent Guardian Review Board for Procurement of Children’s Library Materials, and adding Section 2.30.090 - Selection and Use of Library Materials. A prima facie review was conducted on October 28, 2024. On October 29, 2024, the City Clerk’s Office delivered the Petition to the Orange County Registrar of Voters (ROV) with a request to conduct a signature verification to determine whether the number of petition signatures qualified the initiative for submission to the voters. The ROV delivered a Certificate to Verification of Signatures on Petition for the Petition on December 13, 2024, confirming qualification for submission to the voters. The City Council is asked to adopt Resolution No. 2025-04 accepting the certificate of verification of signatures from the ROV and to order a “Report of Effect of Proposed Initiative.” Financial Impact: The cost for the Registrar of Voters to conduct a 100% signature verification exercise to determine voter registration evidence of 16,089 signatures was $54,702.60 ($3.40/signature). Recommended Action: A) Adopt Resolution No. 2025-04, “A Resolution of the City Council of the City of Huntington Beach Accepting the Certificate as to Verification of Signatures on Petition from the Orange County Registrar of Voters Regarding the Initiative Petition Entitled “An Ordinance to Amend the Huntington Beach Municipal Code by Deleting Chapter 2.66 Thereof Entitled ‘Community Parent Guardian Review Board for Procurement of Children’s Library Materials’ and Adding Section 2.3 0.090 Thereto Entitled ‘Selection and Use of Library Materials;’” and, City of Huntington Beach Printed on 1/16/2025Page 1 of 3 powered by Legistar™ 489 File #:24-797 MEETING DATE:1/21/2025 B) Order a “Report of Effect of Proposed Initiative” pursuant to California Elections Code Section 9212, presented to the City Council within the timeframe described, but no later than 30 days after the elections official certifies to the City Council the sufficiency of the petition . Alternative Action: Do not approve, and direct staff accordingly. Analysis: On October 28, 2024, a citizen initiative petition (Petition) to repeal Ordinance No. 4318 by deleting Huntington Beach Municipal Code Chapter 2.66 - Community-Parent Guardian Review Board for Procurement of Children’s Library Materials, and add new Section 2.30.090 - Selection and Use of Library Materials (Attachment 1) was delivered to the City Clerk, and a prima facie review was conducted that qualified the number of signatures collected at 17,034. On October 29, 2024, the Petition was delivered to the Orange County Registrar of Voters (ROV) with a request to conduct a 100% signature verification exercise. A total of 13,247 signatures was required to qualify for submission to the voters, and 13,257 signatures were verified. The ROV delivered a Certificate to Verification of Signatures on Petition (Certificate) for Petition on December 13, 2024. Pursuant to Elections Code Section 9114, the Certificate is required to be presented to the City Council at its next regularly scheduled City Council meeting, As the petition has been found to be sufficient and contains signatures of not less than 10% of the registered voters of the City of Huntington Beach, City Charter Section 703 and Elections Code Section 9215 require the City Council to take one of the following courses of action: (a) adopt the ordinance, without alteration; or (b) submit the initiative, without alteration, to the voters at the next regular election occurring not less than 88 days after the order of election, or (c) order a report on the effect of the proposed initiative measure pursuant to Section 9212 of the Elections Code at the regular meeting at which certification of the petition is presented, which report may include information on any or all of the following: (1) its fiscal impact; (2) its effect on the internal consistency of the city’s general and specific plans; consistency between planning and zoning, and its effect upon state policy prohibiting discrimination in housing opportunities and encouraging the development of new housing, especially for persons and families of lower income; (3) its effect upon the use of land, the impact on the availability and location of housing, and the ability of the city to meet its regional housing needs; (4) its impact on funding for infrastructure of all types; (5) its impact on the community’s ability to attract and retain business and employment; (6) its impact on the use of vacant parcels of land; (7) its impact on agricultural lands, open space, traffic congestion, existing business districts, and developed areas designated for revitalization; and (8) any other matters the City Council requests to be in the report. If the City Council elects to order a report, pursuant to Section 9212 of the Elections Code of the State of California the report shall be presented to the City Council within the time prescribed by the City of Huntington Beach Printed on 1/16/2025Page 2 of 3 powered by Legistar™ 490 File #:24-797 MEETING DATE:1/21/2025 City Council but no later than 30 days after the elections official certified the sufficiency of the petition to the City Council, no later than February 20, 2025. If a report is ordered, the report will be presented to the Council at the next regular City Council meeting scheduled for February 18, 2025. Following receipt of the report, the City Council shall submit the initiative measure to a vote by the electorate of the City. The City Council is asked to accept the ROV’s certification by Resolution (Attachment 2) and order a “Report of Effect of Proposed Initiative.” Environmental Status: This action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Strategic Plan Goal: Non Applicable - Administrative Item Attachment(s): 1. Ballot Title and Summary 2. Resolution No. 2025-04, “A Resolution of the City Council of the City of Huntington Beach Accepting the Certificate as to Verification of Signatures on Petition from the Orange County Registrar of Voters Regarding the Initiative Petition Entitled “An Ordinance to Amend the Huntington Beach Municipal Code by Deleting Chapter 2.66 Thereof Entitled ‘Community Parent Guardian Review Board for Procurement of Children’s Library Materials’ and Adding Section 2.30.090 Thereto Entitled ‘Selection and Use of Library Materials’” City of Huntington Beach Printed on 1/16/2025Page 3 of 3 powered by Legistar™ 491 492 TITLE: AN ORDINANCE TO AMEND THE HUNTINGTON BEACH MUNICIPAL CODE BY DELETING CHAPTER 2.66 THEREOF ENTITLED "COMMUNITY PARENT GUARDIAN REVIEW BOARD FOR PROCUREMENT OF CHILDREN'S LIBRARY MATERIALS" AND ADDING SECTION 2.30.090 THERETO ENTITLED "SELECTION AND USE OF LIBRARY MATERIALS" SUMMARY: The proposal would delete Chapter 2.66 of the Huntington Beach Municipal Code ("HBMC"), which established the Community Parent Guardian Review Board for · Procurement of Children's Library Materials (the "Parent Review Board") and provided the Board's purpose to review children's books for appropriateness in the Children's Library, and the Board's composition, operating policies, and duties. The proposal would also add HBMC Section 2.30.090 entitled "Selection and Use of Library Materials," which would require the Director of Community and Library Services and "Library Services" (an undefined term) to establish policies for the selection and use of library materials, provided that such policies adopt certain requirements as set forth in the ordinance. ,1.: ,-..::, c:::, to-.:, -c: -., () ::r :;f'.J --·· ::tlOo iT1 Zo··l -< ~~-,: I (") ·-i O"'C· rr, ;z /"' -0., ""1' --0 -< ~ ?? ::r ), <":-? rry :, C, T: ,&:-u, 24-14556/338129 i 493 RESOLUTION NO. 2025-04 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HUNTINGTON BEACH ACCEPTING THE CERTIFICATE AS TO VERIFICATION OF SIGNATURES ON PETITION FROM THE ORANGE COUNTY REGISTRAR OF VOTERS REGARDING THE INITIATIVE PETITION ENTITLED "AN ORDINANCE TO AMEND THE HUNTINGTON BEACH MUNICIPAL CODE BY DELETING CHAPTER 2.66 THEREOF ENTITLED 'COMMUNITY PARENT GUARDIAN REVIEW BOARD FOR PROCUREMENT OF CHILDREN'S LIBRARY MATERIALS' AND ADDING SECTION 2.30.090 THERETO ENTITLED 'SELECTION AND USE OF LIBRARY MATERIALS"' WHEREAS, on April 17, 2024, proponents of an initiative measure entitled "An Ordinance to Amend the Huntington Beach Municipal Code by Deleting Chapter 2.66 Thereof Entitled 'Community Parent Guardian Review Board for Procurement of Children's Library Materials' and Adding Section 2.30.090 Thereto Entitled 'Selection and Use of Library Materials'" ("Initiative") submitted a Notice oflntention and written text of the measure and requested that a title and summary be prepared by the City Attorney for the measure in order to circulate the petition; and WHEREAS, on May 1, 2024, the City Attorney prepared and provided an official ballot title and summary for the proposed Initiative for use by the proponents for publication and circulation of the petition; and WHEREAS, on May 15, 2024, the Huntington Beach City Clerk contacted the Orange County Registrar of Voters to determine the number of registered voters in the City of Huntington Beach, as of its last report to the Secretary of State pursuant to Elections Code Section 2187, effective February 20, 2024, and the Clerk determined that the number of registered voters in the City-was 132,471; and WHEREAS, the Initiative would require at least 13,247 (10%) valid signatures to be sufficient to qualify for a regular or special election; and WHEREAS, the petitions regarding the Initiative were filed with the City Clerk on October 28, 2024, and were then submitted to the Orange County Registrar of Voters on October 29, 2024, for signature verification; and WHEREAS, the results of the signature verification conducted by the Orange County Registrar of Voters established that 16,089 of the 17,034 signatures on the petition were examined, of which 13,257 were found to be sufficient; and WHEREAS, the number of signatures qualified, 13,257, is in excess of the minimum number of signatures required for a regular or special election pursuant to Election Code Section 9215 and 1405; and WHEREAS, the Orange County Registrar of Voters has prepared the Certificate As To Verification Of Signatures On Petition, a copy of which is attached as Exhibit "A"; and 494 RESOLUTION NO. 2025-04 WHEREAS, Elections Code Section 9114 requires that the City Clerk, as the Elections Official of Huntington Beach, shall certify the results of the examination of the petitions to the City Council, NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Huntington Beach hereby accepts the Certificate As To Verification Of Signatures On Petition regarding the Initiative. PASSED, APPROVED and ADOPTED by the City Council of the City of Huntington Beach at a regular meeting thereof held on January 21, 2025. ATTEST: City Clerk 24-15693 / 363033 Mayor APPROVED AS TO FORM t? ,,__,,c ~ p,-,city Attorney 2 495 CERTIFICATE AS TO VERIFICATION OF SIGNATURES ON PETITION State of California) )ss. County of Orange) I, Bob Page, Registrar of Voters of the County of Orange, do hereby certify that I am the county officer having charge of the registration of voters in the County of Orange, and I have examined, or caused to be examined, the signatures contained on the petition submitted to the City of Huntington Beach entitled, "Petition to Repeal Ordinance No. 4318 (Community Parent Guardian Review Board for Procurement of Children's Library Materials)," I further certify that from said examination I have determined the following facts regarding this document: Number of signatures filed: Number of signatures required: Number of signatures verified: Number of signatures found valid: 17,034 13,247 16,089 13,257 Number of signatures found invalid: 2,832 397 Invalid because of Duplicate: WITNESS my hand and Official Seal this 10th day of December, 2024. ~ii BOB PAGE Registrar of Voters Orange County City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:25-033 MEETING DATE:1/21/2025 REQUEST FOR CITY COUNCIL ACTION SUBMITTED TO:Honorable Mayor and City Council Members SUBMITTED BY:Lisa Lane Barnes, City Clerk PREPARED BY:Lisa Lane Barnes, City Clerk Subject: Petition for An Ordinance to Amend the Huntington Beach Municipal Code by Adding New Section 2.30.100, Entitled “Public Operation of Library Services” Statement of Issue: A citizen initiative petition (Petition) with signatures was submitted to the City Clerk’s Office on November 25, 2024, to amend the Huntington Beach Municipal Code by adding Section 2.30.100 entitled “Public Operation of Library Services.” A prima facie review was conducted on November 25, 2024. On November 26, 2024, the City Clerk’s Office delivered the Petition to the Orange County Registrar of Voters (ROV) with a request to conduct a signature verification to determine whether the number of petition signatures qualified the initiative for submission to the voters. The ROV delivered a Certificate to Verification of Signatures on Petition for the Petition on January 2, 2025, confirming qualification for submission to the voters. The City Council is asked to adopt Resolution No. 2025-03 accepting the certificate of verification of signatures from the ROV and to order a “Report of Effect of Proposed Initiative.” Financial Impact: The cost for the Registrar of Voters to conduct a 100% signature verification exercise to determine voter registration evidence of 17,144 signatures was $58,289.60 ($3.40 a signature). Recommended Action: A) Adopt Resolution No. 2025-03, “A Resolution of the City Council of the City of Huntington Beach Accepting the Certificate as to Verification of Signatures on Petition from the Orange County Registrar of Voters Regarding the Initiative Petition Entitled “An Ordinance to Amend the Huntington Beach Municipal Code by Adding New Section 2.30.100, Entitled ‘Public Operation of Library Services;’” and, B) Order a “Report of Effect of Proposed Initiative” pursuant to California Elections Code Section 9212, presented to the City Council within the timeframe described, but no later than 30 days after the elections official certifies to the City Council the sufficiency of the petition. Alternative Action(s): City of Huntington Beach Printed on 1/16/2025Page 1 of 3 powered by Legistar™ 496 File #:25-033 MEETING DATE:1/21/2025 Do not approve, and direct staff accordingly. Analysis: On November 25, 2024, a citizen initiative petition (Petition) “An Ordinance to Amend the Huntington Beach Municipal Code by Adding section 2.30.100, Entitled ‘Public Operation of Library Services’” (Attachment 1) was delivered to the City Clerk, and a prima facie review was conducted that qualified the number of signatures collected at 17,657. On November 26, 2024, the Petition was delivered to the Orange County Registrar of Voters (ROV) with a request to conduct a 100% signature verification exercise. A total of 13,247 signatures was required to qualify for submission to the voters, and 13,257 signatures were verified. The ROV delivered a Certificate to Verification of Signatures on Petition (Certificate) for the Petition on January 2, 2025. Pursuant to Elections Code Section 9114, the Certificate is required to be presented to the City Council at its next regularly scheduled City Council meeting. As the petition has been found to be sufficient and contains signatures of not less than 10% of the registered voters of the City of Huntington Beach, City Charter Section 703 and Elections Code Section 9215 require the City Council to take one of the following courses of action: (a) adopt the ordinance, without alteration; or (b) submit the initiative, without alteration, to the voters at the next regular election occurring not less than 88 days after the order of election, or (c) order a report on the effect of the proposed initiative measure pursuant to Section 9212 of the Elections Code at the regular meeting at which certification of the petition is presented, which report may include information on any or all of the following: (1) its fiscal impact; (2) its effect on the internal consistency of the city’s general and specific plans; consistency between planning and zoning, and its effect upon state policy prohibiting discrimination in housing opportunities and encouraging the development of new housing, especially for persons and families of lower income; (3) its effect upon the use of land, the impact on the availability and location of housing, and the ability of the city to meet its regional housing needs; (4) its impact on funding for infrastructure of all types; (5) its impact on the community’s ability to attract and retain business and employment; (6) its impact on the use of vacant parcels of land; (7) its impact on agricultural lands, open space, traffic congestion, existing business districts, and developed areas designated for revitalization; and (8) any other matters the City Council requests to be in the report. If the City Council elects to order a report, pursuant to Section 9212 of the Elections Code of the State of California the report shall be presented to the City Council within the time prescribed by the City Council but no later than 30 days after the elections official certified the sufficiency of the petition to the City Council, no later than February 20, 2025. If a report is ordered, the report will be presented to the Council at the next regular City Council meeting scheduled for February 18, 2025. Following receipt of the report, the City Council shall submit the initiative measure to a vote by the electorate of the City. The City Council is asked to accept the ROV’s certification by Resolution (Attachment 2) and order a City of Huntington Beach Printed on 1/16/2025Page 2 of 3 powered by Legistar™ 497 File #:25-033 MEETING DATE:1/21/2025 “Report of Effect of Proposed Initiative.” Environmental Status: This action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Strategic Plan Goal: Non Applicable - Administrative Item Attachment(s): 1. Ballot Title and Summary 2. Resolution No. 2025-03, “A Resolution of the City Council of the City of Huntington Beach Accepting the Certificate as to Verification of Signatures on Petition from the Orange County Registrar of Voters Regarding the Initiative Petition Entitled “An Ordinance to Amend the Huntington Beach Municipal Code by Adding New Section 2.30.100, Entitled ‘Public Operation of Library Services City of Huntington Beach Printed on 1/16/2025Page 3 of 3 powered by Legistar™ 498 499 TITLE: An Ordinance to Amend the Huntington Beach Municipal Code by Adding New Section 2.30. l 00, Entitled "Public Operation of Library Services." SUMMARY: This proposal would add new Section 2.30.100 to the Huntington Beach Municipal Code entitled "Public Operation of Library Services." The proposal would prohibit any public library owned or operated by the City as of March 19, 2024, or thereafter owned or operated by the City, from being sold, leased, exchanged or otherwise transferred or disposed of, and also prohibit any service provided by the Huntington Beach Public Library as of March 19, 2024, from being operated or managed by a private contractor that employs library staff to achieve cost savings and/or any proposal that would change the wholesale management of any Huntington Beach library unless: (1) Such service was outsourced to a private organization or operated pursuant to a managed services agreement with a private entity during any period fromJanuary 1, 2018 through March 19, 2024; or (2) The City declared a fiscal emergency pursuant to Article XIIIC, Section 2(b) of the California Constitution; or (3) The above actions were authorized by the affirmative votes of at least a majority of the total membership of the City Council and by the affirmative vote of at least a majority of the electors voting on such proposition at a general or special election at which such proposition is submitted. Additionally, this proposal would require that any contract to change the wholesale management or outsource library management and operations services to a private contractor entered into between March 19, 2024 and the adoptionof new Section 2.30.100, be considered void, or be immediately canceled to the extent permitted by law. ,-...::, r c::, ,:: ~ -,;() ..:.t. :lt -i 0 :Pt-m zn =; -< G") __ ., N ~-i -I..D I..,, 0-<C.1 z o ~ -0 l.D..., :::G ::ic fT1 rn -y I> N ~, u, C, + 24-14690 I 340840 500 RESOLUTION NO. 2025-03 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HUNTINGTON BEACH ACCEPTING THE CERTIFICATE AS TO VERIFICATION OF SIGNATURES ON PETITION FROM THE ORANGE COUNTY REGISTRAR OF VOTERS REGARDING THE INITIATIVE PETITION ENTITLED "AN ORDINANCE TO AMEND THE HUNTINGTON BEACH MUNICIPAL CODE BY ADDING NEW SECTION 2.30.100, ENTITLED "PUBLIC OPERATION OF LIBRARY SERVICES" WHEREAS, on May 15, 2024, proponents ofan initiative measure entitled "An Ordinance to Amend the Huntington Beach Municipal Code by Adding New Section 2.30.100, Entitled "Public Operation of Library Services" ("Initiative") submitted a Notice ofintention and written text of the measure and requested that a title and summary be prepared by the City Attomey for the measure in order to circulate the petition; and WHEREAS, on May 29, 2024, the City Attomey prepared and provided an official ballot title and summary for the proposed Initiative for use by the proponents for publication and circulation of the petition; and WHEREAS, the Huntington Beach City Clerk contacted the Orange County Registrar of Voters to determine the number of registered voters in the City of Huntington Beach, as of its last report to the Secretary of State pursuant to Elections Code Section 2187, effective February 20, 2024, and the Clerk determined that the number of registered voters in the City was 132,471; and WHEREAS, the Initiative would require at least 13,247 (10%) valid signatures to be sufficient to qualify for a regular or special election; and WHEREAS, the petitions regarding the Initiative were timely filed with the City Clerk and were then submitted to the Orange County Registrar of Voters for signature verification; and WHEREAS, the results of the signature verification conducted by the Orange County Registrar of Voters established that 17,144 of the 17,657 signatures on the petition were examined, of which 13,257 were found to be sufficient; and WHEREAS, the number of signatures qualified, 13,257, is in excess of the minimum number of signatures required for a regular or special election pursuant to Election Code Section 9215 and 1405; and WHEREAS, the Orange County Registrar of Voters has prepared the Certificate As To Verification Of Signatures On Petition, a copy of which is attached as Exhibit "A"; and WHEREAS, Elections Code Section 9114 requires that the City Clerk, as the Elections Official of Huntington Beach, shall certify the results of the examination of the petitions to the City Council, 501 RESOLUTION NO. 2025-03 NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Huntington Beach hereby accepts the Certificate As To Verification Of Signatures On Petition regarding the Initiative. PASSED, APPROVED and ADOPTED by the City Council of the City of Huntington Beach at a regular meeting thereof held on January 21, 2025. Mayor ATTEST: APPROVED AS TO FORM f-v ~~ City Clerk bv City Attorney 2 25-15845 I 366078 502 CERTIFICATE AS TO VERIFICATION OF SIGNATURES ON PETITION State of California) )ss. County of Orange) I, Bob Page, Registrar of Voters of the County of Orange, do hereby certify that I am the county officer having charge of the registration of voters in the County of Orange, and I have examined, or caused to be examined, the signatures contained on the petition submitted to the City of Huntington Beach entitled, "Petition to Adopt an Ordinance Amending Title 2 of the Huntington Beach Municipal Code by adding Section 2.30.100." I further certify that from said examination I have determined the following facts regarding this document: Number of signatures filed: Number of signatures required: Number of signatures verified: Number of signatures found valid: 17,657 13,247 17 144 Number of signatures found invalid: 13,257 3,887 378 Invalid because of Duplicate: WITNESS my hand and Official Seal this 19th day of December, 2024. r:~G~C ~ Registrar of Voters Orange County City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:24-882 MEETING DATE:1/21/2025 Subject: Item Submitted by Mayor Pat Burns - Adopt Resolution No. 2025-01 declaring the City to be a non-sanctuary city for illegal immigrants for the prevention of crime Recommended Action: Adopt Resolution No. 2025-01 “A Resolution of the City Council of the City of Huntington Beach, California, Declaring the City of Huntington Beach a Non-Sanctuary City for Illegal Immigration for the Prevention of Crime.” Attachment(s): 1. Burns - Councilmember Item Report 2. Resolution No. 2025-01 City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 503 City Council Meeting – Council Member Items Report To: CITY COUNCIL From: PAT BURNS, MAYOR Date: JANUARY 21, 2025 Subject: RESOLUTION DECLARING HUNTINGTON BEACH TO BE A NON - SANCTUARY CITY FOR ILLEGAL IMMIGRANTS FOR THE PREVENTION OF CRIME 2000 Main Street, Huntington Beach, CA 92648 | www.huntingtonbeachca.gov ISSUE STATEMENT The City of Huntington Beach faces significant challenges related to illegal immigration and crime prevention. Despite existing measures, the rise in violent crime and the impact of illegal immigration necessitates stronger local enforcement and cooperation with federal authorities. The state law, SB 54, has hindered the City's ability to fully utilize local law enforcement resources in coordination with federal agencies. Governor Newsom's policies have further complicated the situation by incentivizing and supporting illegal immigration, which conflicts with federal immigration laws. The City of Huntington Beach, as a Charter City, must navigate these complexities to protect its 200,000 residents. The City Council aims to declare Huntington Beach a non-sanctuary city, affirming its commitment to comply with all federal laws, including Title 8 U.S. Code Section 1324. This resolution emphasizes the City's dedication to reducing crime, safeguarding its citizens, and collaborating with federal agencies to enhance public safety. RECOMMENDED ACTION Adopt Resolution No. 2025-01 “A Resolution of the City Council of the City of Huntington Beach, California, Declaring the City of Huntington Beach a Non-Sanctuary City for Illegal Immigration for the Prevention of Crime.” STRATEGIC PLAN GOAL Non Applicable - Administrative Item ATTACHMENTS 1. Resolution No. 2025-01 504 •. CITY OF _ HUNTINGTON BEACH 505 RESOLUTION NO. 2025-0 l A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HUNTINGTON BEACH, CALIFORNIA, DECLARING THE CITY OF HUNTINGTON B EACH A NON-SANCTUARY CITY FOR ILLEGAL IMMIGRATION FOR THE PREVENTION OF CRIME WHEREAS, the City of Huntington Beach is a Municipal Corporation, and a Charter City created by the people under Article XI of the California Constitution, providing the right and power to make and enforce all laws and regulations in respect to municipal affairs; and WHEREAS , the City's Police Department engages in local arrests and investigations as municipal affairs; and WHEREAS, according to the California Department of Justice, violent crime has risen in California by nearly 20% since 2018 (3 .3% in 2 023, and 15.1% from 2018 to 2023)1, and aggravated assaults, motor vehicle theft, robbery, and arson throughout the State have increased since 2018; and WHEREAS, the Nation has seen violent crime committed by illegal iinmigrants including MS-13 2 and Tren de Aragua gang membe rs including widely reported rapes, murders, assaults, and other crimes.3 In addition, the reported violent crimes by illegal immigrants includes hostile take-overs by force of apartment buildings and other American establishments seen in Aurora, Colorado4 and El Paso, Texas;5 and WHEREAS, Da ta shows that the flow of mass illegal immigration creates human trafficking, including increasing a market in the United States for human trafficking -with "[t]he number of persons prosecuted for human trafficking more than doubled from 2012 to 2022."6 In a recent report, the U.S. Congress noted that nearly 60,000 vi c tims of human trafficking are trafficked into the U.S. annually;7 and 1 https://data-openju s tice.d oj .ca.gov/sit es/defau It/ft les /20 24-07 /C rim e%20 In %20 C A %202023 f. pdf 2 https:/ /jud icia1y .hou se.gov /rn ed ia/i n-the-news/hou se-jud iciary-report-fault s-biden-adm in-release- al leged-ms -13 -mern be r-now 3 https://kfoxtv.com/news/instagram/report-tren-de-arag ua-member-arrested-for-sex-trafficking-migrant- at-gateway-hotel-la-barbie-el-paso-texas-gang-estefania-primera-border-patrol-dps-border-migrants; and https ://www.foxnews.com/us/co lorado-video-s hows -tren-de-aragua-gang -beating-apa rtment-complex- worker-extortion-bid-company-says 4 https://kdvr.com/new s/local/ic e-16-d etained-in-aurora-a re-s us pected-tre n-d e-arag ua-associates 5 https ://k v ia.com/news/border/2024/09/ I 0 /in s ide-a-downtown-el-paso-hote l-th at-is-re ported ly-housing- tre n-de-aragua-gang-mem bers/ 6 https://bjs.ojp.gov/library/publication s/human-trafficking-data-collection-activities- 2024#:~:text=The%20number%20of%20persons%20prosecuted,to%20 I %2C l I 8%20persons%20in%202 022; and https://kfoxtv.com/news/in s t agram/repo1t-tren-d e -arag ua-member-a1Te s ted-for-sex-trafficking- mi g rant-at-gate way-hotel-la-barbie-el-paso-texa s-ga ng -este fania-primera-b orde r-patrol -dps-border- mi g rants 7 https://www.con g ress .gov/118/meetin g/house/1 1634 4/documents /HHRG-118-JU08-2023091 3- SD003 .pdf 24-15722/366670 506 RESOLUTION NO. 2025-01 WHEREAS, human trafficking, which results in sex trafficking, hurts women and children the most8 and has caused over 320,000 immigrant children to go missing in the U.S. and are now completely unaccounted for and unable to be protected;9 and WHEREAS, according to the U.S. Department of Homeland Security, California leads the nation with the highest illegal immigrant population of any other state -with 2,600,000 in 2022. (See Bryan Baker and Robert Warren, Office of Homeland Security Statistics Estimates of the Unauthorized Immigrant Population Residing in the United States: January 2018-Janua,y 2022 (April 2024).)10 WHEREAS, Protecting the City's 200,000 residents from crime and lawlessness is of the greatest import to, and of the highest order for, Huntington Beach's City leaders and its Police Department. Huntington Beach is the 23 rd largest of 482 cities in the State of California. WHEREAS, the City of Huntington Beach has always effectively fully employed and deployed through its Police Department every possible method and resource available for combatting crime in our City; yet the State of California took measures to hinder local law enforcement efforts with the passage of SB 54, which prohibits local police departments from communicated and coordinating with federal agencies on certain arrests to fully enforce all laws, including federal laws; and WHEREAS, The State's "Sanctuary State Law" directly conflicts with U.S. federal immigration laws, including but not limited to Title 8 U.S. Code Sections 1324, 1373 , and Title 18 U.S. Code Sections 371, and 372. California's Sanctuary State Law not only limits the ability of City officials, including Huntington Beach Police personnel, to engage in fullest of effective law enforcement practices, but it directs City officials, including Huntington Beach Police personnel, to violate US. federal immigration laws, including and among others, Title 8 U.S. Code Sections 1324, 1373, and Title 18 U.S. Code Sections 371, and 372; and WHEREAS, the State of California, neither through SB 54 nor any other law, can compel the City of Huntington Beach or its officials to be limited in ability to protect the 200,000 residents of Huntington Beach from crime, nor be limited by State law in ability to employ and deploy every law enforcement measure to protect its residents to the fullest extent possible, nor be compelled to violate any federal laws in the execution of their municipal functions; and · WHEREAS, the City of Huntington Beach is a Charter City, distinct and separate from the State when it comes to "the constitution, regulation, and government of the city police force"11 ; and the City 's Police Department and other Departments of the City, such as the City Manager's Office, the City Council, and City Attorney and Prosecutor's Office have an affirmative duty to not violate any State or federal laws; and 8 https://nypost.com/2021/04/17/how-bidens-border-policy-will-increase-child-sex-trafficking-to-us 9 https://nypost.com/2024/08/21/us-news/biden-harris-admin-loses-track-of-320000-migrant-children 10 https ://ohss.dhs.gov/sites/default/files/2024-06/2024 0418 ohss estimates-of-the-unauthorized---- immigrant-population-res iding-in-the-united-states-january-2018%25E2%2580%2593januaty-2 022.pdf 11 Cal., Const., Article XI, Section S(b)(l) · 2 507 RESOLUTION NO. 2025-01 WHEREAS, Governor Gavin Newsom has taken a series of substantial steps to incentivize the inflow of illegal immigration into California, and to protect and harbor illegal immigrants, with the implementing of policies and laws to: hire illegal immigrants in jobs in State government 12, give illegal immigrants taxpayer funded downpayments of $150,000 to buy homes 13 , spend $2.3 million of taxpayer money to support the relocating and settling of illegal immigrants in rural areas of the State 14, give illegal immigrants home mortgage aid to buy homes 15, newly allocating $25 million in taxpayer funded legal defense fund for illegal immigrants to fight the federal government's announced crackdown on illegal immigration, which seeks to combat the violent crimes committed against U.S. citizens 16, and the list goes on; and WHEREAS, Mayor of Los Angeles Karen Bass, in keeping with Governor Newsom's policies on illegal immigration, recently announced that Los Angeles is a Sanctuary City, and she seeks to protect, defend, provide for, and actively harbor illegal immigrants; and WHEREAS, the suspect arrested with 'flamethrower ' near one of the recent, devastating Los Angeles fires is an illegal immigrant "who will likely be protected by California's sanctuary city status;"17 and WHEREAS, federal immigration law, specifically Title 8 U.S. Code Section 1324 provides that it is a federal crime to assist, transport, or harbor aliens entering the country illegally, and specifically a crime when one "conceals, harbors, or shields from detection, or attempts to conceal, harbor, or shield from detection, such alien in any place, including any building or any means of transportation"18, and Section 1324 makes it a crime to hire an illegal alien 19• and ' WHEREAS, by Title 8 U.S. Code Section 1324, both Governor Newsom's statewide illegal immigrant policies and Mayor Bass's citywide policies violate federal immigration law under Title 8 U.S. Code Section 1324 by the incentivizing the inflow of illegal immigration, by harboring illegal immigrants by working to keep them in place out of reach of federal authorities, 12 https://r eformcalifornia.org/news/reform-california-slams-bill-to-hire-i llegal-immigrants-in-ca-s tate- government 13 https://www.hoover.org/research/californias-one-pa1ty-state-and-hou s ing-subsid ies-undocumented- migrants 14 https://bus in ess.ca.gov/support in g-californias-rural-communities-2-3-million-in-grants-to-futther- expand-immigrant-integration -in-rural-regions 15 https://www.latimes.com/california/sto ry/2024-08-29/ca lifornia-lawmakers-approve-home-mortgage- aid-to-undocumented-immigrants . 16 https://www.nationalreview.com/news/california-governor-newsom-requests-25 -million-from- legi slature-fo r-anti-trum p-1 itigation-fund 17 https:/ /nypost.com/2025/0 I/ 13/us-news/suspect-arrested-with-fl amethrower-near-kenneth-fire-is-an- i I lega l-immigrant-report 18 https://www.j ustice.gov/arch ives/jm/crim inal-resource-manual -1907-titl e-8-usc-1324a-offenses 19 https://www.justice.gov/archives/j m/criminal-resource-manual-1908-unlawful-employme nt-alie ns- criminal-penalties 3 508 RESOLUTION NO. 2025-01 and by implementing policies to hire illegal immi gra nt s into California government, all in violation of Section 1324; and WHEREAS, in an opinion by the California Attorney General in 1992 examining a California city's local sanctuary ordinance, the Attorney General stated that sanctuary law is preempted by 8 U.S.C. § 1324. CA Attorney General·Opinions, 75 Ops. Cal. Atty. Gen. 270 (Nov. 19, 1992). The California Attorney General concluded, "Due to the supremacy clause of the United States Constitution, a city may n ot prohibit its officers and empioyees from cooperating in their official capacities with Immigration and Naturalization Service investigation, detention, _or arrest procedures relating to alleged violations of the civil provisions of the federal immigration laws." (Id. at 270.);20 and WHEREAS, the Court of Appeal in California has already held that "Where otherwise warranted investigation by local officers lead s to evidence of a federal civil or criminal vio lation, the local authority has the right to exchange information with federal authorities; to deny such an exchange is not reasonable and rewards those federal violators fortunate enough to be arrested by loca l, rather than federa l, officials." (See Gates v. Superior Court, 19 3 Cal.App .3d 205, at 219.); and WHEREAS, the California Attorney General determined that a sanctuary ordinance "concerns a subject matter, immigration, wherein federal power to regulate is exclusive." ( citing De Canas v. Bica, 424 U.S. 351, 354-55 (1975)). 2 1 Federal pree mption occurs when the local enactment "stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress." (Hines v. Davidowitz, 312 U.S. 52, 67 (1941).); and WHEREAS, "A direct conflict w ith a federal or st ate statute or regulation presents a separate and distinct basis for the preemption of a local ordinance." (CA Attorney General Opinions, 75 Ops. Cal. Atty. Gen. at 276, n. 9 (citations omitted).)22 WHEREAS, local law enforcement agencies and city officials are at li berty, or should be, to not only comply with a ll federa l laws, including Tit le 8 U.S. Code Section 1324, and elect to cooperate with federal agencies for the betterment of their cities and the protection of their residents. NOW, THEREFORE, the City Council of the City of Huntington Beach does hereby resolve as follows: SECTION 1. The City of Huntington Beach is hereby not a Sanctuary City; and SECTION 2. The City of Huntington Beach, its Police Department, other Departments, and its offic ials are obligated to, and will, follow all federal laws, including immigration laws, including Title 8 U.S. Code Sections 1324, 1373 , a nd Title 18 U.S. Code Sections 371, and 372; a nd 20 https://oag.ca.gov/system/files/opin ions/pdfs/92-607 .pdf 2 1 https://oag.ca.gov/system/files/opinions/pdfs/92-607.pdf 22 https://oag.ca.gov/system/files/opinions/pdfs/92-607.pdf 4 509 RESOLUTION NO. 2025-01 SECTION 3. The City of Huntington Beach, its Police Department, other Departments, and its City officials shall employ and deploy every means and resource necessary to combat crime and protect the citizens of Huntington Beach, including coordinating and communicating with federal law enforcement agencies and honoring ICE detainers; and SECTION 4. The City of Huntington Beach, its Police Department, other Departments, and City officials, shall cooperate with the new Trump Administration, Border Czar Tom Homan, and any federal agencies to increase local law enforcement efforts, combat a ll crimes, and increase public safety, by comp lying with all federal laws, including but not limited to, Title 8 U.S . Code Sections 1324, 1373, and Title 18 U.S. Code Sections 371, and 372; and SECTION 5. The City Attorney shall take any legal action necessary to preserve the City's rights herein and to protect and defend City Officials in the discharge of their duties pursuant to this Resolution, including but not limited to taking any legal action necessary against any contrary action brought by the State against the provisions in this Reso lution . PASS ED AND ADOPTED by the City Council of the City of Huntington Beach at a regular meeting thereof held on the 21st day of January 2025. Mayor REVIEWED AND APPROVED: Acting City Manager 5 City of Huntington Beach 2000 Main Street, Huntington Beach, CA 92648 File #:25-034 MEETING DATE:1/21/2025 Subject: Item Submitted by Mayor Pat Burns, Mayor Pro Tem Casey McKeon, and Council Member Don Kennedy - Bolsa Chica Senior Project Ad Hoc Committee Notification Recommended Action: The City Council approve the Ad Hoc Committee’s recommendation to direct the City Manager to work with the City Attorney to send a letter to the Project Proponents notifying them of the Ad Hoc Committee’s intent to further evaluate the information presented to the City Council and the public at the October 15th, 2024, Hearing, which was relied on prior to the Council Members casting their votes. Attachment(s): 1. Councilmember Item - Bolsa Chica Senior Project Ad Hoc Committee Notification City of Huntington Beach Printed on 1/16/2025Page 1 of 1 powered by Legistar™ 510 City Council Meeting – Council Member Items Report To: City Council From: Pat Burns, Mayor Casey McKeon, Mayor Pro Tem Don Kennedy, Council Member Date: January 21, 2025 Subject: Bolsa Chica Senior Project Ad Hoc Committee Notification 2000 Main Street, Huntington Beach, CA 92648 | www.huntingtonbeachca.gov ISSUE STATEMENT At the December 17, 2024, City Council Meeting, the Huntington Beach City Council approved for the creation of an Ad Hoc Committee for the purpose of conducting additional research and determining if all information provided for the approval of the Bolsa Chica and Warner Senior Living Project was fully presented (with nothing hidden), accurate, complete, and therefore reliable. At the October 15, 2024, City Council Meeting, a public hearing was conducted for the proposed Bolsa Chica and Warner Senior Living Project, which included a presentation by the project proponent, input from public speakers, and discussion among Council Members. However, as was discussed by City Council at the December 17th City Council Meeting, a lot of information presented at the October 15th Hearing seemed to be incomplete, or at minimum, inconsistent with the proposed Bolsa Chica and Warner Senior Living Project. Importantly, that information provided was relied upon for the purpose of approval for the Bolsa Chica Specific Plan. The Ad Hoc Committee’s goal is to revisit all of the information, data, and analysis that supports the Bolsa Chica and Warner Senior Living Project to verify accuracy or determine any stated or written inaccuracies, which if discovered, may lead to amending, revocation, or repeal of the Bolsa Chica Specific Plan. RECOMMENDED ACTION The City Council approve the Ad Hoc Committee’s recommendation to direct the City Manager to work with the City Attorney to send a letter to the Project Proponents notifying them of the Ad Hoc Committee’s intent to further evaluate the information presented to the City Council and the public at the October 15th, 2024, Hearing, which was relied on prior to the Council Members casting their votes. ENVIRONMENTAL STATUS Not applicable STRATEGIC PLAN GOAL Non Applicable - Administrative Item 511 •. CITY OF _ HUNTINGTON BEACH