HomeMy WebLinkAboutCity of Elk Grove - Public Financial Report
To the Residents of Elk Grove
The Finance Department is proud to present you with the City’s Annual Finan-cial Report to the Community for the fiscal year (FY) ended June 30, 2021. This
report provides an overview of the City’s financial condition and a brief analysis
of where the City revenues are derived and where those dollars are spent.
Most of the information in this report is drawn from the financial information ap-
pearing in the FY 2020-21 Annual Comprehensive Financial Report (ACFR). The ACFR is a more detailed and complete financial presentation prepared in
conformance with Generally Accepted Accounting Principles (GAAP) and was
audited by the City’s independent auditors, receiving an unmodified opinion. While the financial data in this document is derived from GAAP data, the statis-
tical, economic and demographic data are taken from various sources and are
not GAAP-basis data.
We hope you will find this information to be interesting and informative. We
welcome your comments and suggestions for future reports. Both the ACFR and this document are available for viewing at the local public libraries, City Hall
and on the City's website at http://www.elkgrovecity.org/city_hall/
departments_divisions/finance/accounting/.
City Overview
In 1850, Elk Grove was established as a hotel and stagecoach stop. Located in
the State of California 15 miles south of historic Sutter’s Fort in Sacramento, Elk
Grove became a crossroads for business, entertainment, mail service and agri-culture and acted as a home base for gold miners in nearby communities. After
the early gold rush, a close-knit community evolved with a distinctly rural and
western lifestyle. Today, the City of Elk Grove is a growing and active commu-
nity.
The City of Elk Grove incorpo-rated under California law on July
1, 2000, as a general-law city.
The City operates under the City
Council/Manager form of govern-
ment. The City Council is a five
member body with a Mayor and four Council Members. The elect-
ed mayor serves a two-year term
and is elected citywide (at-large).
The four councilmember posi-
tions are also elected citywide 1
and each represent one of four council residency districts where the councilmember
must reside and are elected from the residency district they represent rather than City
wide.
The City provides a variety of services to its residents which include public safety, ani-
mal control, highways and streets, public improvements, planning and zoning, code en-forcement, building permits, recycling and waste, drainage, and general administration.
Before COVID, the unemployment rate was 4.4% but ballooned to 14.8% in April 2020. Since then, unemployment rates have generally stabilized and gradually improved to
5.3% in the Sacramento area. However, many employers are facing labor shortages
and have had to increase compensation to retain and attract employees while many members of the workforce have shifted industries in response to the pandemic.
Property valuations increased again during fiscal year 2020-21 by 5.2% in Elk Grove over the prior year. Expectations are that the City will continue experiencing valuation
increases in fiscal year 2021-22.
To mitigate the financial impact of the pandemic, many economic stimulus measures
have been passed at both the State and Federal levels to assist small businesses, non-
profits, homeowners, renters, and families. The City distributed funding it received through Community Development Block Grant funds and the CARES Act during fiscal
year 2020-21 to businesses and non-profits and initiated programs such as Great Plates
Delivered. During fiscal year 2020-21, the Federal Government passed the American Rescue Plan Act aimed at providing additional stimulus funds for businesses and non-
profits and also to provide the first assistance directly to local governments to compen-
sate for lost revenue and costs associated with the pandemic. Through this program,
the City received approximately $11 million in 2021, with another $11 million anticipated
in 2022.
Financial Highlights for Fiscal Year 2021
The City prepares two types of financial statements that measure its finances. The gov-
ernment-wide statements present a long-term perspective of the City’s assets, liabilities
and net assets, as well as its operations. The fund statements provide a short-term per-
spective of individual fund’s assets, liabilities and fund balance, as well as the resources
flowing in and out during the fiscal year. The General Fund is the main operating fund
of the City.
Highlights of the City’s financial activities for the fiscal year ending June 30, 2021 in-
clude:
City’s assets exceeded its liabilities at June 30, 2021 by $1.5 billion
Cash and investments comprised of $299 million in the City treasury and over $12
million of restricted cash held by fiscal agents.
Net capital assets of $1.1 billion include the City’s entire infrastructure in addition to
all other City assets. As of June 30, 2021, the governmental funds reported combined fund balances of
$299 million, of which all is available to meet the City’s current and future needs.
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STATEMENT OF NET POSITION
*Detailed financial reports can be found in the City’s FY 2020-21 ACFR available on the City’s website at http://www.elkgrovecity.org/city_hall/departments_divisions/finance/accounting/ , City Hall or local public libraries.
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The Statement of Net Position presents information on all of the City’s assets
and liabilities, with the difference between the two reported as net position. Over time, increases or decreases in net position may serve as a useful indica-
tor of whether the City's financial position is improving or weakening.
2021 2020
Assets
Current and other assets 416,077,472$ 354,691,485$
Capital assets 1,126,074,907 1,137,628,916
Total Assets 1,542,152,379 1,492,320,401
Deferred Outflow of Resources
Deferred outflows or resources related to pensions 13,580,926 13,278,752
Deferred outflows or resources related to OPEB 10,241,353 15,388
23,822,279 13,294,140
Liabilities
Current and other liabilities 39,064,758 32,305,525
Long-term liabilities 72,736,714 52,449,430
Total Liabilities 111,801,472 84,754,955
Deferred Inflows of Resources
Deferred inflows of resources related to pensions 1,426,508 1,243,727
Deferred inflows of resources related to OPEB 1,095,535 186,358
2,522,043 1,430,085
Net Position
Net investment in Capital 1,087,752,347 1,111,392,631
assets1
Restricted net position2 292,185,610 279,266,731
Unrestricted net position 71,713,187 28,770,139
Total Net Position 1,451,651,144$ 1,419,429,501$
1Capital Assets less accumulated depreciation and the related debt.
2Asset whose use is restricted by statute or law.
Total Net Position For Last Ten Years
As noted in the table on the prior page, capital assets are a significant investment for the City.
This includes streets, roads, drainage systems and buildings. Since assets are reported net of
depreciation, the net position change can decline as the depreciation exceeds reinvestment.
Accomplishments
The City has been developing a 56-acre site now known as District56 in Laguna Ridge
for a variety of years. This 56-acre site includes the Aquatics Center and Commons,
Community & Senior Center, Veteran's Hall and Veteran’s Grove, dancing fountain, pub-
lic art, and future home of the District56 Library and Cultural Arts Center. The remaining
30 acres on the south side of the property has been designated for the Preserve at Dis-
trict56, a passive recreational site with expansion of the west and east parking lots. The
Preserve includes a beautiful pond which serves as a focal point of the space. Board-
walks and meandering walkways entice visitors to explore the space and lead to a new
fitness court, group picnic area, and children’s play area. The Preserve was completed in
the fall of 2021.
The City continues to focus on improvements in the Old Town Elk Grove Area that will revitalize the existing plaza. The City completed the Old Town Plaza Phase 2 and 3 Pro-
ject and the Railroad Street Improvements Project in the summer of 2021. The com-
bined project creates a gathering space that celebrates Old Town’s rich heritage and railroad history. The plaza improvements include an entrance plaza, walkways, bike
parking, seat wall, lawn/landscaping areas, and a pavilion structure, two new public park-
ing lots, as well as new street improvements.
On March 9, 2021, the Wilton Rancheria Tribe hosted a groundbreaking ceremony for the Sky River Casino, which is now under construction. To mitigate the potential impacts
of the Project, the City and the Tribe executed a Memorandum of Understanding, ap-
proved by the City Council in September 2016, that provides funding to the City of Elk Grove, Elk Grove Unified School District, and local non-profit organizations to pay for
services such as law enforcement and traffic impacts and compensate for the loss of tax
revenue. The total cumulative payment from the Tribe to the community over 20 years is
approximately $132 million. They are scheduled to open in late 2022.
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STATEMENT OF ACTIVITIES
*Detailed financial reports can be found in the City’s FY 2020-21 ACFR available on the City’s web-site at http://www.elkgrovecity.org/city_hall/departments_divisions/finance/ accounting/, City Hall or
local public libraries. 5
The Statement of Activities provides a record of the money received by the City
and spent during the year. Explanations of specific Resources and Services are
provided on the following pages. Overall, revenues have continued to increase in
spite of the onslaught of COVID and building increased which increases fees and
receipts.
2021 2020
Revenues:
Program revenues:1
Fees, fines and charges for services 52,774,387$ 46,069,401$
Operating grants and contributions 45,992,929 34,774,193
Capital grants and contributions, debt proceeds 35,594,106 9,617,430
134,361,422 90,461,024
General Revenues:2
Property taxes 31,196,810 29,381,358
Sales and use taxes 34,975,729 29,768,093
Other taxes 11,305,394 10,785,744
Other revenue 3,608,745 14,140,142
81,086,678 84,075,337
Total Revenues 215,448,100 174,536,361
Expenses:
General government 28,142,121 19,995,028
Public safety 52,721,661 45,928,962
Public ways and facilities 68,792,816 66,498,261
Community development 13,712,896 10,607,681
Interest on long-term debt 1,038,694 1,003,870
Solid Waste 3,046,795 2,999,283
Transit 10,027,298 10,509,143
Drainage 6,169,730 4,742,055
Revenue Neutrality 5,648,413 6,295,158
Total Expenses 189,300,424 168,579,441
Change in Net Position 26,147,676 5,956,920
Net Position - Beginning, as restated 1,425,503,468$ 1,419,429,501$
Net Position - Ending 1,451,651,144$ 1,425,386,421$
1Revenues derived directly from, fees, charges and grants
2All revenues that are not related to programs
Where the money comes from...
Revenues
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Fees, fines and charges for services - payments received directly by the City
for services performed. Includes fees such as development services fees, code
enforcement fines, utility payments and business licenses.
Operating grants and contributions - monies received from parties outside the
City and are generally restricted to one or more specific programs. Includes
revenue types such as Transit funding, street funding like Measure A and
assessments, vehicle licensing fees from the State and Police Grants from
other governmental agencies for public safety.
Capital grants and contributions - monies received for capital purposes, to
purchase, construct, or renovate capital assets associated with a specific
program. Includes items such as Measure A financing for constructing
roadways and highway interchanges.
Property taxes - 5 to 6% of property tax collected by the County and allocated
to the City. The City further shares 50% of the property taxes with the
County of Sacramento per the Revenue Neutrality agreement implemented
at incorporation that decreases to 40% in FY 2021-22. See expense on the
following page.
Sales and use taxes - 1% sales tax collected on retail sales in the City.
Other taxes - smaller taxes collected by the City such as Utility User Tax and
Transient Occupancy Tax.
Other revenue - interest earned on investments of idle funds and any revenue that
does not readily fit into a previously listed category.
Where the money goes...
Expenses
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*Detailed financial reports can be found in the City’s FY 2020-21 ACFR available on the City’s
website at http://www.elkgrovecity.org/city_hall/departments_divisions/financi/accounting, City Hall or local public libraries.
Public ways and facilities - reflects expenses associated with the repair,
construction, acquisition and maintenance of public roads and bicycle
overcrossing.
Public safety - includes all aspects of law enforcement.
Recylcing and Waste - expenses associated with refuse and recycling.
Transit - represents expenses associated with operation of public transportation,
including busses and paratransit.
General government - includes expenses for the administrative offices including
the City Council, City Manager, City Attorney, Finance, Human Resources,
City Clerk, Insurance and general administration of the City.
Community development - reflects services provided to residents and businesses
including Planning, Building, Code Enforcement, Communications and Youth
Commission.
Revenue Neutrality - agreement between City and County at incorporation lasting
25 years to ensure the County remains revenue neutral by receiving a portion
of the City's property tax.
Interest on long-term debt - indirect expense of interest paid on general long-
term debt incurred by governmental capital improvements.
Drainage - maintenance of storm water drainage system.
Total Revenues & Expenses Last Ten Fiscal Years
Where Your Property Tax Dollar Goes…
Revenue Neutrality—Property owners are levied one percent of appraised value
for annual property tax payment. Of this payment, an average of 5.7 cents is allo-
cated to the City annually to provide services. At incorporation, the City accepted
that a portion of the property taxes generated within City would be retained by the
County to hold them revenue neutral. As a result, the City nets only 50% of those
funds (2.9 cents of total tax payment) as available for services. This agreement will phase out over time ending in fiscal year 2026.
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Operational expenses have balanced each year or have been less than operations, but
capital projects typically span multiple years and may expend funds that have accumulat-ed over time. The spike in revenue for 2017 is due to debt refinancing of the Laguna Ridge CFD 2005-1 that provided capital project funding to the City of $72.7 million.
Patrick Hume
Councilmember
Stephanie Ngyuen Vice Mayor Bobbie Singh-
Allen Mayor
City of Elk Grove Council District Map
District 3
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Darren Suen
Councilmember
District 1 District 2
Kevin Spease
Councilmember
District 4
City of Elk Grove Facts*
Population 178,124 Area 42 square miles
Elevation 45 feet Miles of Streets 553
Miles of Sidewalk 899 Streetlights 13,885 Traffic Signs 23,657 Manholes 8,162
Feet of Pipe 2,121,685 Storm Drain Inlets 12,745
Sales Tax Rate 7.75%
Averages
Low Temperature 24-44 degrees Median Age 37.5 years
High Temperature 80-115 degrees Median Home Price -
Annual Precipitation 22” October to April $628,049
*Estimates
**Population has increased 1.2% over the previous year. The City is the second largest incor-porated city within Sacramento County.
Current City Council as of December 31, 2020
Visit the City of Elk Grove Website at http://www.elkgrovecity.org
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The Government Finance Officers Association of the United States
and Canada (GFOA) has given an Award for Outstanding Achieve-
ment in Popular Annual Financial Reporting to the City of Elk Grove for its Popular Annual Financial Report for the fiscal year ended June 30, 2020. The Award for Outstanding Achievement in Popular
Annual Financial Reporting is a prestigious national award recog-
nizing conformance with the highest standards for preparation of state and local government financial reports.
In order to receive an Award for Outstanding Achievement in Popu-
lar 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 cur-
rent report continues to conform to the Popular Annual Financial
Reporting requirements, and we are submitting it to GFOA.
City of Elk Grove
Finance Department
8401 Laguna Palms Way
Elk Grove, CA 95758
(916)683-7111
www.elkgrovecity.org