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HomeMy WebLinkAboutCounty of San Diego - Public Financial ReportCounty of San Diego, California Popular Annual Financial Report Fiscal year ended June 30, 2021 County of San Diego, California / 2021 Popular Annual Financial Report Citizens of San Diego County: Our Popular Annual Financial Report (PAFR) for the fi scal year ended June 30, 2021 was prepared by the Auditor and Controller’s offi ce to provide readers of interest an easy to understand summary of our fi nancial activities. The data from this report was taken from our Annual Comprehensive Financial Report (ACFR) for the fi scal year ended June 30, 2021. Both reports are available online at www.sdcounty.ca.gov/auditor/cafr.html. The information included in this report contains an overview of the County’s economy and outlook, an analysis of the County’s fi nancial position and key fi nancial information concerning the County’s investments, capital assets and debt. It also includes a summary of our General Management System, around which we have built a culture of operational excellence, and highlights the four County business groups. It also provides summaries of how the County’s monies were received and spent and includes signifi cant statistical and demographic data. It is important to note that the fi nancial data in this report is unaudited, includes information exclusively on primary government funds and is presented on a non-GAAP (Generally Accepted Accounting Principles) basis. This means that it excludes discrete component unit and fi duciary fund information, contains condensed fi nancial information and does not provide all of the necessary fi nancial statements and note disclosures required by GAAP. We hope you enjoy reading this report and invite you to access our audited ACFR online for more detailed information on your County fi nances. We welcome your questions, comments and suggestions regarding the information in this report. You can contact our offi ce at (858) 694-2176. Ebony N. Shelton Deputy Chief Administrative Officer/ Chief Financial Officer ABOUT THIS REPORT Tracy Drager Auditor and Controller 2 County of San Diego, California / 2021 Popular Annual Financial Report The County was incorporated on February 18, 1850, and functions under a charter adopted in July 1933. A fi ve- member Board of Supervisors elected to four-year terms in district nonpartisan elections governs the County. The Board of Supervisors appoints the following offi cers: the Chief Administrative Offi cer (CAO), the County Counsel, the Probation Offi cer and the Clerk of the Board of Supervisors. All other non- elected offi cers are appointed by the CAO. Elected offi cials head the offi ces of the Assessor/ Recorder/County Clerk, District Attorney, Sheriff and Treasurer- Tax Collector. It is the second largest County by population in California behind Los Angeles County. There are 18 incorporated cities in the County; of them, the City of San Diego is the largest and Del Mar is the smallest. Tijuana, Mexico is a substantial urban neighbor with a shared border, workforce, and economy. ABOUT SAN DIEGO COUNTY Board of Supervisors Nora Vargas District 1 Vice-Chair Joel Anderson District 2 Nathan Fletcher District 4 Chair Jim Desmond District 5 Terra Lawson-Remer District 3 Sources: 2021 ACFR Statistical Table 13 and Adopted Operational Plan Fiscal Years 2020-21 & 2021-22. Statistics 7.0% UNEMPLOYMENT RATE 490,068 SCHOOL ENROLLMENT $6.55 Billion ADOPTED ANNUAL BUDGET $49,703 PERSONAL INCOME PER CAPITA The 2021 ACFR is available at: https://www.sandiegocounty. gov/content/sdc/auditor/cafr. html 3 County of San Diego, California / 2021 Popular Annual Financial Report San Diego’s economy has been aff ected by the Coronavirus Disease 2019 (COVID-19). Unemployment rose sharply from pre- COVID-19 levels of 3.2 percent to a 2020 peak of 15.9% at the end of April; it dropped to a pandemic low of 6.8% in November before the winter surge in COVID- 19 cases sent cases upward and caused additional State closures on businesses (California Employment Development Department. San Diego - Carlsbad MSA Labor Force Data, accessed on March 29, 2021). By May 2021, the local San Diego unemployment rate was 6.3%, slightly higher than the US average (5.5%) and lower than the State’s rate (7.5%) (California Employment Development Department. San Diego - Carlsbad Metropolitan Statistical Area Press Release. June 2021). Most experts expected overall sales tax dollars to be less in 2020 than the same period in 2019, but stimulus funding and a shift to online shopping have not only helped consumers but the overall health of the economy. The state of the economy plays a signifi cant role in the County’s ability to provide core services and the mix of other services sought by the public. A number of risk factors are continuously monitored, including employment, the housing market, and the national economy as a whole. County management continuously evaluates and responds to the changing economic environment and its impact on the cost and the demand for County services. ABOUT SAN DIEGO COUNTY County Economy and Outlook (1) Industry employment is by place of work; excludes self-employed individuals, unpaid family workers, and household domestic workers. (2) Excludes the U.S. Department of Defense. Source: Adopted Operational Plan Fiscal Years 2021-22 & 2022-23. Employment Mix (1) 235,900 GOVERNMENT (2) 253,400 PROFESSIONAL & BUSINESS SERVICES 220,500 TRADE, TRANSPORTATION & UTILITIES 211,800 EDUCATIONAL & HEALTH SERVICES 130,400 LEISURE & HOSPITALITY 112,900 MANUFACTURING 74,000 FINANCIAL ACTIVITIES 87,800 CONSTRUCTION 40,600 OTHER SERVICES 21,900 INFORMATION TECHNOLOGY 8,400 FARMING 300 MINING & LOGGING Source: 2021 ACFR Letter of Transmittal and Management’s Discussion and Analysis. San Diego County Population Source: Adopted Operational Plan Fiscal Years 2021-22 & 2022-23. 114,463 CARLSBAD 62,099 NATIONAL CITY 272,202 CHULA VISTA 177,335 OCEANSIDE 21,381 CORONADO 49,338 POWAY 4,268 DEL MAR 1,430,489 SAN DIEGO 104,393 EL CAJON 97,209 SAN MARCOS 62,183 ENCINITAS 57,999 SANTEE 153,008 ESCONDIDO 13,838 SOLANA BEACH 28,055 IMPERIAL BEACH 102,928 VISTA 59,966 LA MESA 505,675 UNINCORPORATED 26,526 LEMON GROVE 3,343,355 TOTAL 4 County of San Diego, California / 2021 Popular Annual Financial Report The Government Finance Offi cers Association of the United States and Canada (GFOA) has given an Award for Outstanding Achievement in Popular Annual Financial Reporting to the County of San Diego for its Popular Annual Financial Report for the fi scal year ended June 30, 2020. The Award for Outstanding Achievement in Popular Annual Financial Reporting is a prestigious national award recognizing conformance with the highest standards for preparation of state and local government popular reports. In order to receive an Award for Outstanding Achievement in Popular Annual Financial Reporting, a government unit must publish a Popular Annual Financial Report, whose contents conform to program standards of creativity, presentation, understandability, and reader appeal. An Award for Outstanding Achievement in Popular Annual Financial Reporting is valid for a period of one year only. We believe our current report continues to conform to the Popular Annual Financial Reporting requirements, and we are submitting it to GFOA to determine its eligibility for another Award. ACHIEVEMENTS During fi scal year 2021, the County received awards for its leadership and excellence in operations, including 51 awards from the National Association of Counties. Examples include: Health and Human Services Agency: Live Well Mobile Offi ce. Adds to the County’s capability to deliver indispensable services in a coordinated and integrated manner, to improve the lives of residents, and realize the Live Well San Diego vision. The mobile offi ce was launched to ensure services are delivered directly to San Diego County communities in a comprehensive and multidisciplinary way. Planning and Development Services: Permit Streamlining, and Self-Certifi cation Program. Program that allows professional customers to certify certain building permits themselves, reducing their plan-check times. The program was created in response to stakeholder requests and allows customers to self-certify certain permit types to reduce plan check time performed by County staff . This program has a training and auditing component that allows interested and qualifi ed professionals to use their experience and license to certify that their plans are complete and designed to meet all the local requirements. Assessor/Recorder/County Clerk - The Marriage Hut was created to continue issuing marriage licenses to the public during the global pandemic, while following State and County public health orders. A separate space was set up in an open-air environment to allow for proper ventilation as well as social distancing during marriage license appointments, and has been very well received by the public. County Fire: Emergency Access Program Gives Vulnerable Residents Peace of Mind. Launched in 2020, the Residential KnoxBox program’s objective is to provide back-up emergency access to overcome a barrier during crises: a locked front door. The program provides indestructible lock boxes that store a spare house key. Called KnoxBoxes, County Fire staff install the boxes at no cost on the homes of qualifying residents. The program is available to some of County Fire’s most vulnerable residents: those 62 years or older, disabled, or who need help with a major life activity. Outstanding Achievement Other Awards and Recognitions Note: Other Awards and Recognitions are listed in the 2021 ACFR Letter of Transmittal and Adopted Operational Plan Fiscal Years 2021-22 & 2022-23. Government Finance Officers Association Award for Outstanding Achievement in Popular Annual Financial Reporting Presented to the County of San Diego California For its Annual Financial Report for the Fiscal Year Ended 2020 Executive Director/CEO 5 County of San Diego, California / 2021 Popular Annual Financial Report GENERAL MANAGEMENT SYSTEM The General Management System outlines the County’s strategic intent (strategic planning), prioritizes its goals and use of resources (operational planning), describes how it monitors progress on performance (monitoring and control), ensures collaboration (functional threading) and recognizes accomplishments (motivation, rewards and recognition) throughout the year. By communicating and adhering to this business model, the County of San Diego is able to maintain an organizational culture that values transparency, accountability, innovation and fi scal discipline and which provides focused, meaningful public services. Each of the fi ve components of the GMS form an annual cycle. Certain components take place at specifi c times, while others are performed year-round. COUNTY STRATEGIC INITIATIVES Strategic planning communicates the County’s strategic direction for the next fi ve years. The Strategic Plan explains the County’s four Strategic Initiatives, in addition to its vision, mission and values. The four Strategic Initiatives focus on how we achieve the County’s vision of a region that is Building Better Health, Living Safely and Thriving. Source: Adopted Operational Plan Fiscal Years 2021-22 and 2022-23. 6 Building Better Health Ensure every resident has the opportunity to make positive healthy choices, and that San Diego County has fully optimized its health and social services delivery system with an intentional focus on equity to make health, safety and thriving a focus of all policies and programs. Make San Diego the safest and most resilient community in the nation, where youth are protected and the criminal justice system is balanced between accountability and rehabilitation. Living Safely Sustainable Environments/ Thriving Operational Excellence Promote continuous improvement in the organization through problem solving, teamwork and leadership with a focus on customers’ needs and keeping employees positive and empowered. Strengthen the local economy through planning, development and infrastructure, protect San Diego’s natural and agricultural resources and promote opportunities for residents to engage in community life and civic activities. Strategic Initiatives County of San Diego, California / 2021 Popular Annual Financial Report COUNTY STATEMENT OF VALUES County of San Die g o Statement of Va l u e s VisionA region that is B u i l d i n g B e t t e r H e a l t h , L i v i n g S a f e l y a n d T h r i v i n g MissionTo efficiently pr o v i d e p u b l i c s e r v i c e s t h a t b u i l d s t r o n g a n d s u s t a i n a b l e c o m m u n i t i e s Core Values In recognition t h a t “ T h e n o b l e s t m o t i v e i s t h e p u b l i c g o o d , ” w e a r e d e d i c a t e d t o t h e f o l l o w i n g v a l u e s : Integrity Character First x We maintain th e p u b l i c ’ s t r u s t t h r o u g h h o n e s t a n d f a i r b e h a v i o r . x We exhibit the c o u r a g e t o d o t h e r i g h t t h i n g f o r t h e r i g h t r e a s o n . x We are dedicat e d t o t h e h i g h e s t e t h i c a l s t a n d a r d s . Stewardship Service Before S e l f x We are account a b l e t o e a c h o t h e r a n d t h e p u b l i c f o r p r o v i d i n g s e r v i c e a n d v a l u e . x We uphold the l a w a n d e f f e c t i v e l y m a n a g e t h e C o u n t y ’ s p u b l i c f a c i l i t i e s , r e s o u r c e s a n d n a t u r a l environment. x We accept pers o n a l r e s p o n s i b i l i t y f o r o u r c o n d u c t a n d o b l i g a t i o n s . x We will ensure r e s p o n s i b l e s t e w a r d s h i p o f a l l t h a t i s e n t r u s t e d t o u s . Commitment Excellence in all t h a t w e d o x We work with pr o f e s s i o n a l i s m a n d p u r p o s e . x We make a posi t i v e d i f f e r e n c e i n t h e l i v e s o f t h e r e s i d e n t s w e s e r v e . x We support a di v e r s e w o r k f o r c e a n d i n c l u s i v e c u l t u r e b y e m b r a c i n g o u r d i f f e r e n c e s . x We practice civili t y b y f o s t e r i n g a n e n v i r o n m e n t of courteous a n d a p p r o p r i a t e t r e a t m e n t o f a l l employees and t h e r e s i d e n t s w e s e r v e . x We promote in n o v a t i o n a n d o p e n c o m m u n i c a t i o n . 7 County of San Diego, California / 2021 Popular Annual Financial Report Net position may serve over time as a useful indicator of a government's fi nancial position. In the case of the County, assets and deferred outfl ows of resources of the County exceeded liabilities and deferred infl ows of resources by $3.38 billion at the close of fi scal year 2021, an increase of $44.4 million or 1.3% over fi scal year 2020. This included a $171.5 million increase in net investment in capital assets, (a 4.7% increase over fi scal year 2020), and an increase of approximately $245.6 million in the County's restricted net position (a 21.2% increase over fi scal year 2020). Additionally, unrestricted net position decreased by $372.7 million (a 25.1% decrease over fi scal year 2020).The previously mentioned increase of $44.4 million in net position was composed of changes in total assets, deferred outfl ows of resources, liabilities, and deferred infl ows of resources. The largest portion of the County's net position refl ects its net investment in capital assets of $3.83 billion (land, easements, buildings and improvements, equipment, software and infrastructure; less any related outstanding debt used to acquire those assets). The County uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the County's net investment in capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be liquidated for these liabilities. An additional portion of the County's net position (restricted net position) equaled $1.41 billion and represents resources that are subject to external restrictions on how they may be used. External restrictions include those imposed by grantors, contributors, laws and/or regulations of other governments. The remaining portion of the County's net position includes $(1.86) billion in net negative unrestricted net position attributable to the County’s outstanding Net Pension Liability and Net OPEB Liability. COUNTY FINANCIALS Source: 2021 ACFR Management's Discussion and Analysis Table 1. June 30, 2021 and 2020 (In thousands) Total Primary Government 2021 2020 Assets Current and other assets $ 5,420,109 4,958,636 Capital assets 4,146,332 3,938,373 Total assets 9,566,441 8,897,009 Deferred Outfl ows of Resources Total deferred outfl ows of resources 1,527,765 1,166,318 Liabilities Long-term liabilities 6,279,368 5,625,441 Other liabilities 1,342,602 945,099 Total liabilities 7,621,970 6,570,540 Deferred Infl ows of Resources Total deferred infl ows of resources 93,207 158,133 Net Position Net investment in capital assets 3,832,335 3,660,873 Restricted 1,404,546 1,158,944 Unrestricted (1,857,852) (1,485,163) Total net position $ 3,379,029 3,334,654 Government-wide Statement of Net Position The 2021 ACFR is available at: https://www.sandiego-county.gov/content/sdc/auditor/cafr.html 8 County of San Diego, California / 2021 Popular Annual Financial Report COUNTY FINANCIALS Here are some defi nitions that will take the mystery out of the accounting terms you will fi nd throughout the fi nancial sections of this report. Government-wide: This PAFR presents the balance sheet (statement of net position) which includes assets, deferred outfl ows of resources, liabilities, deferred infl ows of resources, and net position. It also presents the income statement (statement of changes in net position) which includes revenue and expense information. Governmental Funds: The County maintains various governmental funds that are used to account for tax, program and other miscellaneous revenues. Business-type Funds: The County maintains various business-type funds that are used to account for activities for which a fee is charged to external users for goods or services. Primary Government: Includes all of the governmental and business-type activities belonging to the County but excludes the discrete component unit and fi duciary funds. Assets: What is owned by the County. Deferred outfl ows of resources: Use of net assets (assets minus liabilities) applicable to a future year. Liabilities: What the County owes. Deferred infl ows of resources: Net assets (assets minus liabilities) received applicable to a future year. Net position: The diff erence between: assets plus deferred outfl ows of resources; minus liabilities and deferred infl ows of resources. It's the County's net worth. Current and other assets: Includes such items as pooled cash and investments, cash and investments with fi scal agents, receivables, internal balances, inventories, deposits with others, and prepaid items. Capital assets: Includes such items as County land, easements, construction in progress, buildings and improvements, software, equipment, infrastructure, and accumulated depreciation/amortization, if applicable. Long-term liabilities: Includes such items as bonds, loans, compensated absences, net pension liability, net other postemployment benefi ts (OPEB) liability, and other County obligations. Other liabilities: Includes such items as payables, payroll, accrued interest and unearned revenue. Net investment in capital assets: Represents amounts invested in capital assets less accumulated depreciation/amortization and any outstanding debt used to acquire these assets. Restricted: What is not available for use by the County because it is set aside for a particular use. Unrestricted: One-time funds available for the County to use for operations. Key Terms Total Net Position Fiscal Years 2017 - 2021 (In billions) 2021 $3.38 2017 $2.82 2018 $2.88 2019 $3.21 2020 $3.33 9 County of San Diego, California / 2021 Popular Annual Financial Report Program revenues are those that derive directly from the program itself or from other parties, not the taxpayers; while general revenues are those not required to be reported as program revenues. All expenses are reported under a specifi c function - a group of related activities aimed at accomplishing a major service or regulatory program for which a government is responsible. Notable changes in revenues between fi scal years 2020 and 2021 are attributable in part to increases of: $394 million in COVID-19 revenue tied to the County’s T3 Strategy of Test, Trace and Treat to support COVID-19 emergency response eff orts (broken down as follows: $190 million COVID-19; $50 million in COUNTY FINANCIALS Government-wide Statement of Changes in Net Position Source: 2021 ACFR Management's Discussion and Analysis Table 2. For the Years Ended June 30, 2021 and 2020 (In thousands) Total Primary Government 2021 2020 Revenues: Program Revenues Charges for services $ 630,817 646,844 Operating grants and contributions 3,758,523 3,066,604 Capital grants and contributions 24,242 29,828 General Revenues Property taxes 881,605 851,473 Transient occupancy tax 5,386 4,173 Real property transfer tax 35,608 25,138 Miscellaneous taxes 8 3 Property taxes in lieu of vehicle license fees 465,076 441,609 Sales and use taxes 37,810 30,967 Investment earnings (2,998) 104,681 Other 97,870 104,738 Total revenues 5,933,947 5,306,058 Expenses: Governmental Activities: General government 465,464 426,846 Public protection 1,823,535 1,848,040 Public ways and facilities 163,809 188,295 Health and sanitation 1,363,772 1,022,279 Public assistance 1,838,270 1,475,071 Education 56,272 52,225 Recreation and cultural 57,617 57,995 Interest 57,386 47,689 Business-type Activities: Airport 15,586 14,889 Jail Stores Commissary 5,222 5,776 San Diego County Sanitation District 31,716 28,385 Sanitation District - Other 10,923 9,504 Total expenses 5,889,572 5,176,994 Changes in net position before transfers 44,375 129,064 Transfers Changes in net position 44,375 129,064 Net position at beginning of year 3,334,654 3,205,590 Net position at end of year $ 3,379,029 3,334,654 COVID-19 American Rescue Plan Act (ARPA); and, $154 attributable to the CARES Act); $55 million in federal aid tied to various alcohol and drug treatment and mental health programs; $47 million in federal aid tied to Social Services Administrative revenue; and, $44 million tied to various Public Health Services grants primarily in Epidemiology and Laboratory Capacity (ELC) for Prevention and Control of Emerging Infectious Diseases grant. Notable changes in expenses between fi scal years 2020 and 2021 include increases of $263 million tied to the County’s T3 Strategy of Test, Trace and Treat to support COVID-19 emergency response eff orts; $150 million in overall salaries and benefi t costs; $96 million increase tied to the $94 million Great Plates Delivered Program and $2 million in various Aging & Independence Services programs to support COVID-19 emergency response eff orts; and, $46 million in Small Business Stimulus Program expenses. 10 County of San Diego, California / 2021 Popular Annual Financial Report REVENUES: Charges for services: Fees charged for licenses, permits and franchises, fi nes, forfeitures, penalties and other fees. Operating grants and contributions: Aid from local, state and federal agencies. Capital grants and contributions: Federal and state grants for capital activities and donations made from external entities, e.g. developers. Property taxes: County property taxes levied. Transient occupancy tax: A tax levied by the County on rental receipts for temporary lodging in a hotel or other similar facility doing business in the unincorporated area. Real property transfer tax: A tax assessed on property when ownership is transferred. Miscellaneous taxes: Various other taxes levied. Property taxes in lieu of vehicle license fees: Property taxes collected in lieu of vehicle license fees. Sales and use taxes: A consumption tax charged at the point of purchase for certain goods and services. Investment earnings: Earnings on County investments. Other: Includes various miscellaneous revenue types that are not reported in aforementioned categories. EXPENSES: General government: Services provided by support departments such as the Assessor/Recorder/County Clerk, Auditor & Controller, Treasurer-Tax Collector, County Counsel, Board of Supervisors and the County Technology Offi ce. Public protection: Services provided by departments such as Agriculture Weights and Measures, District Attorney, Department of Animal Services, Offi ce of Emergency Services, fi re protection County Service Areas, Medical Examiner, Probation, and Sheriff . Public ways and facilities: Services provided by departments such as Permanent Road Divisions, Public Works, and the San Diego Lighting Maintenance District. Health and sanitation: Services provided by departments such as ambulance and paramedic County Service Areas, Environmental Health, Health and Human Services Agency, Inactive Waste Site Management and certain permanent road divisions. Public assistance: Services provided by departments such as Health and Human Services Agency, Housing Authority, Probation and In Home Supportive Services Public Authority. Education: Services provided by departments such as the County Library. Recreation and cultural: Services provided by departments such as park County Service Areas, and Parks and Recreation. Interest: Expenses associated with County debt. Airport: Expenses related to the maintenance, operations and development of County airports. A major objective of the airport program is to develop airport property utilizing federal and State grants in order to enhance the value of public assets, generate new revenues and be a catalyst for aviation and business development. Jail Stores Commissary: Expenses related to the fi nancing of a Sheriff 's commissary store allowing persons incarcerated at various County detention facilities to purchase a variety of goods, including food, snacks, stationery, personal care items and telephone time. Sanitation Districts: Expenses related to the operations of the sanitation districts governed under the Board of Supervisors. County Revenues & Expenses Fiscal Years 2017-2021 (In billions) COUNTY FINANCIALS Key Terms Expenses Revenues $5.31 $5.93 2020 2021 2017$4.28 2018$4.55 $4.90 2019 $5.89 $4.34 $4.37 $4.57 5.18 11 County of San Diego, California / 2021 Popular Annual Financial Report COUNTY FINANCIALS 12 Where does the money go? Where does the money come from? Operating grants and contributions 63.3% Property taxes 14.9% Charges for services 10.6% Property taxes in lieu of vehicle license fees 7.8% Other 3.4% [Capital grants and contributions .4% Investment earnings .1% Transient occupancy tax 0.1% Real property transfer tax 0.6% Sales and use taxes 0.6% Other 1.6%] Public protection 31.0% Public assistance 31.0% Health and sanitation 23.2% General government 7.9% Public ways and facilities 2.8% Other 4.1% [Business-type activities 1.1% Education 1.0% Interest 1.0% Recreation and cultural 1.0%] County of San Diego, California / 2021 Popular Annual Financial Report Credit ratings are forward-looking opinions about credit risk. This year the County Pool (the "Pool") remained rated AAAf/S1 by Fitch. The ‘AAAf’ rating indicates the highest level of protection against losses from credit defaults, whereas the ‘S1’ volatility rating indicates that the Pool possesses low sensitivity to changing market conditions. The County Pool's Investment Policy and California State Law set minimum credit ratings for each type of investment held by the Pool. The Pool invests in highly rated securities rated at least "A/F1" by Fitch Ratings or another nationally recognized statistical rating organization. KEY FINANCIAL DATA County Pooled Investments Pooled Investments (In thousands) Investment Fair Value Fitch Rating U.S. Federal Agencies $ 3,051,088 NR/AA+/AAA U.S. Treasury Notes 1,088,906 AAA Pass-through Securities 487,985 NR -AAA Supranationals 1,116,426 NR -AAA Commercial Paper 2,318,756 A-1 -A-1+ Local Government Investment Pools 200,708 AAA Money Market Mutual Funds 3,800 NR -AAA Municipal Bonds 241,362 NR -AAA Negotiable Certifi cates of Deposit 2,705,093 A-1 -A-1+ Corporate Medium-Term Notes 697,476 A-1 -A-1+ Total investments $ 11,911,600 Note: Data presented in this chart excludes investments with fi scal agents. Source: 2021 ACFR Notes to the Financial Statements Table 7. The County investment policies and practices are based on prudent money management principles and state law. The objectives of the Pooled Investment Policy are: To safeguard the principal of the funds under the County Treasurer's control. To meet the liquidity needs of the participants. To achieve an investment return on the funds under control of the County Treasurer within the parameters of prudent risk management. U.S. TREASURY NOTES 9.14% NEGOTIABLE CERTIFICATES OF DEPOSIT 22.71% SUPRANATIONALS 9.37% CORPORATE MEDIUM-TERM NOTES 5.86% MONEY MARKET MUTUAL FUNDS .03% PASS-THROUGH SECURITIES 4.10% COMMERCIAL PAPER 19.47%U.S. FEDERAL AGENCIES 25.61% LOCAL GOVERNMENT INVESTMENT POOL 1.68% MUNICIPAL BONDS 2.03% 13 County of San Diego, California / 2021 Popular Annual Financial Report The chart below depicts the outstanding capital assets, net of depreciation/amortization, as of June 30, 2021 for both Business-type and Governmental funds. At June 30, 2021, the County’s capital assets, net of depreciation/amortization totaled $4.15 billion. Capital assets are used to provide services to county residents. Some of the signifi cant capital asset activity in fi scal year 2021 was as follows: $83.1 million towards construction of Youth Transition Campus. $64.4 million towards construction and improvements of County maintained roads, bridges, and other road related infrastructure. $59.1 million towards acquisition of equipment. $19.8 million towards Rock Mountain Detention Facility renovations. $16.8 million towards improvement of various capital projects. $15.8 million towards development of various software applications. $11.7 million towards construction of Tijuana River Valley Regional Park Campground and Nature Education Center. $11.7 million towards County Administration Center renovations. $9.5 million towards construction of Regional Communication System. $8.4 million towards various land acquisitions for the Multiple Species Conservation Program. $7.5 million towards Ohio Street Probation renovations. $7.3 million towards land acquisition for Emergency Vehicle Operations Course. $5.1 million towards improvements at Gillespie Field Cajon Air Center. KEY FINANCIAL DATA Capital Assets 14 Land Equipment Easements SoftwareBuildings &Improvements RoadInfrastructure Sewer Infrastructure Bridge Infrastructure .24% 4.38% 1.77% 27.97% 1.34% 1.39% 13.11% 42.54% Construction in Progress 7.26% County of San Diego, California / 2021 Popular Annual Financial Report County Debt Service Requirements to Maturity (In thousands)At June 30, 2021 the County’s long-term liabilities totaled $1.709 billion: $1.078 billion in long-term debt principal of certifi cates of participation, bonds and loans; and $631 million of other long-term liabilities including capital leases, claims and judgments, compensated absences, landfi ll postclosure, pollution remediation, and unamortized premiums and discounts. KEY FINANCIAL DATA Long-Term County Principal Debt Outstanding Loans Loans provide funds for the construction of low income housing; for various projects in County facilities to increase energy effi ciency; for the purchase of one acre of property located in the Borrego Springs area to support the County's Regional Communications System (RCS); and energy savings measures at various facilities. Certificates of Participation (COP) and Lease Revenue Bonds (LRB) COP/LRB provide funds for the acquisition and construction of major capital facilities and equipment. The repayment of these COP/LRB is secured by a lease structure where the borrowing entity leases certain properties to another entity, a lessor, which in turn leases the properties back to the borrower. These lessors are the San Diego County Capital Asset Leasing Corporation (SANCAL), and the San Diego Regional Building Authority (SDRBA). Taxable Pension Obligation Bonds (POB) POBs are issued by the County to reduce its pension unfunded actuarial liability and to achieve interest rate savings by issuing bonds at interest rates which are less than the assumed rate of return earned on proceeds placed in the San Diego County Employees Retirement Association’s (SDCERA) pension plan. They are also issued to refund previously issued Pension Obligation debt. Tobacco Settlement Asset-Backed Bonds (TSAB) TSAB are issued by the Tobacco Securitization Joint Powers Authority of Southern California to securitize future revenue streams available to the County pursuant to various agreements. County Board of Supervisors Policy Manual, Section B, Policy B-65, “Long-Term Obligations and Financial Management Policy” (http:// www.sandiegocounty.gov/content/sdc/cob/policy.html), provides guidance on the County’s long-term fi nancial strategy and obligations. Examples of management practices and other information about long-term obligations found in the policy include the following: The County shall:  Invest general purpose revenue savings generated by maturing long-term obligations and/or refi nancings to accelerate payment of outstanding long-term obligations and/or to avoid the issuance of new long-term obligations by cash fi nancing of capital projects;  Continually review outstanding obligations and aggressively initiate refi nancings when economically feasible and advantageous; and,  Never use long-term fi nancial obligations to fi nance current operations or recurring needs. Note: This chart includes debt principal, unaccreted appreciation and interest. $2,609 $1,226,259 $465,157 $277,861 15 POB TSAB COP/LRB Loans 37.14%42.98% 19.64% .24% Note: This chart includes debt principal only County of San Diego, California / 2021 Popular Annual Financial Report KEY FINANCIAL DATA Sources: https://www.moodys.com/sites/products/AboutMoodysRatingsAttachments/MoodysRatingSymbolsandDefi nitions.pdfhttps://www.spratings.com/documents/20184/774196/Guide_to_Credit_Rating_Essentials_Digital.pdfhttps://www.fi tchratings.com/site/defi nitions Note: S&P and Fitch use a plus (+) or minus (-) to show relative standing within its major rating categories. Moody’s appends numerical modifi ers 1, 2 and 3 to each generic rating classifi cation from Aa to Caa where 1 indicates ranking at the higher end, 2 is mid-range and 3 ranks at the lower end of its category. Credit Ratings As of June 30, 2021 Moody’s Standard & Poor’s Fitch Issuer Rating Aaa AAA AAA Certifi cates of Participation San Diego County Capital Asset Leasing Corporation (SANCAL)Aa1 AA+ AA+ Lease Revenue Refunding Bonds SDRBA (County Operations Center) Series 2016A Aa1 AA+ AA+ Pension Obligation Bonds Aa2 AAA AA+ Tobacco Settlement Asset-Backed Bonds - Series 2006B CAB (First Subordinate)not rated CCC- not rated Tobacco Settlement Asset-Backed Bonds - Series 2006C CAB (Second Subordinate)not rated CCC- not rated Tobacco Settlement Asset-Backed Bonds - Series 2006D CAB (Third Subordinate)not rated CCC- not rated Tobacco Settlement Asset-Backed Bonds - Series 2019A (Class 1) Serial Bonds not rated A,A- not rated Tobacco Settlement Asset-Backed Bonds - Series 2019A (Class 1) Term Bonds not rated BBB+ not rated Tobacco Settlement Asset-Backed Bonds - Series 2019B-1 (Class 2) Turbo CIB not rated BBB+,BBB- not rated Tobacco Settlement Asset-Backed Bonds - Series 2019B-2 (Class 2) Turbo CAB not rated not rated not rated San Diego County Redevelopment Agency Bonds not rated not rated not rated Source: 2021 ACFR Management’s Discussion and Analysis Table 3. Credit Rating Scale Moody’s Standard & Poor’s Fitch CBBaaAa Aaa D CCC B BBB AA AAA DBBAA AAA 16 County of San Diego, California / 2021 Popular Annual Financial Report PROPERTY TAX The County Assessor prepares the local roll which includes the values of real & personal property located throughout the County. The fi rst step in the assessment process is to locate and identify all parcels of property. This is done through the use of assessor’s parcel maps. There are more than 29,100 assessor’s maps, showing 1,004,808 parcels of land. These maps cover the county, including all the cities as well as the unincorporated areas. The parcel maps show the assessor’s parcel numbers, recorded dimensions, acreage, street widths, parcel and lot boundaries, adjoining parcels and recorded map information. The information found on these maps is obtained from government maps, recorded maps, subdivision maps, record of surveys and road surveys. The table below shows the inventory of parcels and assessed valuations for fi scal year 2020-2021. For more information regarding maps and how to obtain a copy, visit https://arcc.sdcounty.ca.gov. Sources: County of San Diego Property Valuations, Tax Rates, Useful Information for Taxpayers Fiscal Year Ending June 30, 2021, Table 23. Assessment Parcel: An area of land in one ownership and one general use that in the opinion of the assessor should be included under one description for assessment purposes after consideration of all legal factors. Assessed Value: One hundred percent of full value for the 1981/82 fi scal year and the following fi scal years. Prior to fi scal year 1981/82, the assessed value was 25% of the full value. Assessor’s Maps: The foundation of the assessor’s record system and provide the legal description for the assessment of all parcels of real property for taxation. Current Roll: The roll containing the property on which current taxes are a lien. “Roll” means the entire assessment roll. 1. Represents the exchange of Property Tax for Cities and County Vehicle License Fee as authorized under Senate Bill 1096, chaptered August 5, 2004. 2. The collection allocated to Educational Revenue Augmentation Fund (ERAF) was used to pay the in lieu of vehicle license fee (VLF) to County and Cities. 3. Includes districts under the Board of Supervisors. 4. The redevelopment agencies were dissolved in Fiscal Year 2011-12 (ABx1 26). Their share of property taxes were deposited to the redevelopment successor agencies’ Redevelopment Property Tax Trust Fund (RPTTF) and these funds were allocated to Redevelopment Successor Agencies, County, Schools, Cities, Special Districts and the State Controller offi ces as provided by Health and Safety Code, Division 24, Part 1.85. Sources: 2021 ACFR Statistical Table 8; Details of the Property Tax Collection Allocation were provided by the County Auditor and Controller’s Property Tax Services Division. Key Terms Property Tax Collection Allocation The County collected $5.90 billion of the 1% property tax (including Unitary tax) as of June 30, 2021. This chart shows the Fiscal Year 2021 Property Tax Collection Allocation. Inventory of Parcels and Assessed ValuationsFiscal Year 2020-2021 Real Property Total Taxable Parcels Assessed Valuations Residential 936,884 $ 444,802,779,161 Industrial 11,233 31,657,879,391 Commercial 27,087 87,886,786,264 Irrigated Farm 3,118 1,260,417,599 Rural Land (Non-irrigated) 8,461 1,583,678,882 Institutional 2,211 10,394,077,599 Recreational 15,319 3,233,973,565 Miscellaneous 495 37,532,180 Total Taxable Parcels 1,004,808 $ 580,857,124,641 Note: Data represents total assessed values of real property only, without exemptions. - SPECIAL DISTRICTS (3) 3% - COUNTY IN LIEU OF VLF (1) 8% - CITIES 13% - COUNTY LIBRARY 1% - COUNTY GENERAL 13% - SCHOOLS (1)(2) 45% - CITIES IN LIEU OF VLF (1) 5% - REDEVELOPMENT SUCCESSOR AGENCIES’ RPTTF (4) 12% 17 Inventory of Parcels and Assessed Valuations County of San Diego, California / 2021 Popular Annual Financial Report By the Numbers Serving the Public Operational Excellence Sheriff : Integrated technology in the deployment of public safety response, using the Alert Response Tool (ART) mobile app which takes the public safety grid book and puts it in the hands of fi rst responders out in the fi eld to accurately select and alert areas for evacuation orders. ART reduces delays and creates effi ciencies for managing large evacuation events such as wildfi res. Purchasing and Contracting: Coordinated and publicized contracting opportunities with local business chambers, business associations, and other community agencies. Collaborated with several public agencies for small business outreach events, including CalTrans, San Diego County Regional Airport Authority, the US Navy, and the San Diego Small Business Development Center. Public Works: Commenced a Green Streets Clean Water Plan to support water quality improvement and sustainability. The plan will establish criteria to identify and rank potential project opportunities based on their anticipated water quality benefi t and other co-benefi ts such as increased sidewalk connectivity, creation of green space, and fl ood attenuation. Health and Human Services Agency: Created a Dementia Friendly Activities Toolkit, which gives dementia friendly practices to help caregivers with communication strategies and off ers activity adaptations for diff erent levels of dementia progression. Activities include art, music, physical activity, cooking, gardening, and more and is available in English, Spanish, Arabic, Tagalog, and Vietnamese. General Services: Received the U.S. Green Building Council’s distinction of LEED Gold for the Sheriff Technology Information Center. Parks and Recreation: Received a California State Association of Counties 2020 Challenge Award. The County’s Virtual Recreation Center (Center) through the department of Parks and Recreation provides activities for people of all ages, interests and abilities. Programs are interactive, accessible and engaging. The Center includes virtual hikes and tours, video tutorials, printing coloring sheets and activity books, scavenger hunts and challenges, invitation to ranger-led education sessions and more. Medical Examiner’s Offi ce: Received a California State Association of Counties 2020 Challenge Award. The County’s Medical Examiner’s Offi ce is one of eight California Counties accredited by the National Association of Medical Examiners (NAME), which sets national standards in forensic medicine. It is one of three accredited in California by the American College of Graduate Medical Education (ACGME) to educate future forensic pathologists. Additionally, the Medical Examiner’s Forensic Toxicology Laboratory is also accredited by the American Board of Forensic Toxicology (ABFT). Health and Human Services Agency: Edgemoor Distinct Part Skilled Nursing Facility was once again named #1 nursing home in Newsweek’s ranking of America’s Best Nursing Homes 2021. This list highlights top nursing homes, compared to others in the state, based on performance data, peer recommendations, and the facility’s handling of the COVID-19 threat. Note: Other Awards and Recognitions are listed in the 2021 ACFR Letter of Transmittal and Adopted Operational Plan Fiscal Years 2021-22 & 2022-23. Treasurer-Tax Collector: Maintained a collection rate of 99.0% for secured taxes and 96.1% for unsecured taxes by preparing and mailing property tax bills/notices and processing tax payments in a timely manner to ensure timely revenue collection on behalf of San Diego County’s taxpayers. District Attorney: Continued the San Diego Opioid Project, a public outreach and education campaign that produced 46 million impressions and 3.8 million online engagements. The data-driven campaign focused on re-framing the dangers of opioid use with the goal of reducing overdose deaths and saving lives. Health and Human Services Agency: Immunized 100% (16,345) of children under eighteen who were served at Public Health Centers and Clinics to protect them from diseases, such as measles and whooping cough. University of California Cooperative Extension: Conducted virtual nutrition education for 1,133 children and youth from low-income and limited-resource families in English and Spanish via 19 virtual workshops (consisting of at least 6 hours for each workshop series) to promote nutrition and physical activity for a healthy lifestyle that can reduce the risk of childhood obesity and chronic diseases such as diabetes and heart disease. 18 ACHIEVEMENTS OF NOTE County of San Diego, California / 2021 Popular Annual Financial Report Source: Shutterstock.com Cover page: Sunny day at Mission Trails Regional Park Beach in San Diego/ Gloria V Moeller; Ocean waves crashing on the rocks near the La Jolla Cove with seals and seabirds/Michael J Magee; Page 2: La Jolla Cove sunrise. San Diego, California USA./Dancestrokes; San Diego, California - August 02, 2021: Bayfront view of the San Diego Convention Center/Noah Suave; Page 3: Aerial view of Miramar reservoir in the Scripps Miramar Ranch community, San Diego, California. Miramar lake, popular activities recreation site including boating, fi shing, picnic & 5-mile-long trail./Bonandbon; Aerial View of San Diego Waterfront Park/Cassiohabib; Page 4: Downtown San Diego, California, Usa. October 2016. Gaslamp/Johan Erkki; Downtown San Diego at night/S. Borisov; Page 5: San Diego’s Balboa Park Bell Tower in San Diego California/Dancestrokes; Sunset in Anza Borrego State Park as viewed from Font’s Point./Jim_Brown_Pho-tography; Page 9: San Diego, California / USA - January 24, 2016: Mission Trails Regional Park. Recent rainfall in the region gives a healthy fl ow of water over the spillway of the historical Old Mission Dam./Craig Chaddock; Page 4: Downtown San Diego at night/S.Borisov; Page 16: Amazing panoramic view of the San Diego downtown by the harbour with many skyscrapers and huge aircraft carrier docked by the pier./Ingus Kruklitis; Back Cover: Borrego Springs, CA USA - April 2, 2021: The Anza-Borrego Desert State Park Visitor Center Wooden sign./Rosamar. 19 Equity, Diversity & Inclusion D&I EC DHR EDI OEC ERGs OERJ HRC Diversity & Inclusion Executive Council Department of Human Resources: Equity, Diversity & Inclusion Division Office of Ethics & ComplianceEmployee Resource Groups (ERGs) Leon L. Williams Human Relations Commission Internally focused on integrating equity, diversity, and inclusion into the organizational County Culture and specifically supporting the areas of recruitment, hiring, and professional development/ advancement. Department dedicated to fostering a culture of integrity, implementing the Code of Ethics, promoting ethics and compliance through developed policies, programs and trainings, and reviewing discrimination, fraud, waste and abuse complaints. 31-member commission established to promote positive human relations , respect and integrity of every individual in the County of San Diego. Diverse executive leadership creating a culture that keeps diversity and inclusion at the forefront for leaders throughout the enterprise by guiding the County’s diversity and inclusion strategy. The County of San Diego has ten thriving Employee Resource Groups that play an important role in advancing our commitment to diversity and creating and sustaining an inclusive workplace. ERGs provide employees networking and professional development activities, support County initiatives, and promote cultural awareness. COUNTY of SAN DIEGO D&I PARTNERSHIP MODEL Office of Equity & Racial Justice Devoted to engaging the community to cocreate transformative, enduring, structural and systemic change in San Diego County government. Photo Credits DIVERSITY & INCLUSION County of San Diego 5530 Overland Avenue, Suite 410, San Diego CA 92123 www.sdcounty.ca.gov