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HomeMy WebLinkAboutCity of Citrus Heights - Public Financial ReportCity of Citrus Heights Popular AnnualFinancial Report FOR YEAR ENDED JUNE 30, 2021 Intentionally Left Blank To the Citizens of City of Citrus Heights: Welcome to City of Citrus Height's first-ever Popular Annual Financial Report (PAFR). The PAFR, also referred to as the "Citizen's Report", is intended to provide our citizens with an easy-to-read explanation of the City's finances. The PAFR provides an overview of the City's financial condition for the fiscal year ended June 30, 2021 (FY 21), and a brief analysis of where the City's revenues are derived and where those dollars are spent. The Finance Division of the Administrative Services Department is dedicated to promoting transparency and fiscal accountability within local government. This Citizen’s Report serves an important function in that mission by providing our taxpayers and stakeholders with access to City financial information. Although this FY 21 PAFR is being released as we approach the end of FY 22, it was due to a unique opportunity in February 2022 to participate in a leadership program with the Government Finance Officers Association and the Engaging Local Government Leaders (ELGL) organization that partnered our City with a graduate student to develop this first-ever PAFR. Thank you to Minisha Trivedi and Dena Jenkins for creating this first-ever PAFR. I hope you enjoy reading the City’s PAFR. If you have comments, questions, or suggestions please reach out to the City of Citrus Heights Administrative Services Department at finance@citrusheights.net or (916) 725-2448. Rajneil Prasad Accounting Manager MESSAGE FROM THE ACCOUNTING MANAGER Rajneil Prasad Visit the City's Website 3 4 5 6 7 8 9 10 11 2 Award: GFOA Certificate Table of Contents 13 Government Profile City History City Demographic City Statistics Net Position Statement General Funds Statement Statement of Activities City Revenues City Expenditures City Roads & Repairs Major Project Completed COVID-19 14 Jeannie Bruins Council Member Government Profile Current City Council City of Citrus Heights Organization Chart Administrative Services Department Community Development Department General Services Department Police Department City Attorney City Manager City Manager's Office The Citrus Heights City Council consists of five members, elected to four-year overlapping terms in district-based elections. Council members must be residents of the City. Thepositions of Mayor and Vice Mayor are chosen by the City Council through policy direction determined by the City Council. The Mayor conducts the City Council meetings andrepresents the City on ceremonial occasions. The City Council serves as the policy board for the municipality. As an elected Board of Directors, the City Council provides policy direction, establishes goals, and sets priorities for the City government. In addition to serving as the policy makers for the community, the City Council also is responsible for numerous land use decisions within its borders, including the General Plan. The City Council appoints the City Manager, City Attorney, and all members of advisory boards and commissions. Porche Middleton Mayor Bret Daniels Council Member Steve Miller Council Member Tim Schaefer Vice Mayor 2 The City of Citrus Heights’ roots date back to the mid-1800’s when the 20,000-acre Mexican land grant known as Rancho Del San Juan was formed. At the time, the area was mostly lush grassland with native oak groves and few isolated frontier outposts. However, this changed after gold was discovered in 1849 and California was admitted into the Union in September 1850. Due to exponential population growth during this Gold Rush period townships were established with present-day Citrus Heights as Sacramento County’s Central Township. A new shortened road to Auburn was built which cut diagonally through Central Township along present-day Auburn Boulevard to Sylvan Corners and then continued along today’s Old Auburn Road. Freight wagons provided early settlers of Central Township, who established their homes and ranches along this road, opportunity to sell their crop which consisted primarily of wheat. Hay and Barley were grown mostly as food for livestock. In 1862, the Sylvan Schoolhouse was built on Sylvan Corners and in 1863, ground was broken on the Central Pacific Railroad which passed through Central Township. The completion of the railroad lead to continued population growth, agricultural exports, land development, and a second grammar school, the San Juan School. When Trainor & Desmond bought a large tract of idle land and divided them into ten acre lots for development, they replaced the name Sylvan with Citrus Heights and it has remained so ever since. Throughout the early to mid-1900’s, Citrus Heights continued to grow steadily. Construction on the state highway system and Highway 40, known today as Interstate 80, allowed for easier travel from San Francisco to Roseville. As population increased over the years, irrigation, fire-fighting groups, and emergency rescue units were establish. Significant commercial development, including Sunrise Mall and Birdcage Walk shopping centers, of the 1970’s established Citrus heights as an important retail destination. Incorporation efforts began in November 1984 when citizen members of the chamber of commerce circulated petitions and received signatures forming the Citrus Heights Incorporation Project (CHIP). CHIP fought a long battle against Sacramento County arguing over who should be allowed to vote for incorporation and possible tax revenue loss from a Citrus Heights incorporation. In 1993, the U.S. Supreme Court upheld the California Supreme Court ruling that only residents of the proposed city should vote on incorporation and thus opening the door for CHIP efforts to move forward. A year later, CHIP finalized an agreement with Sacramento County that included a Revenue Neutrality agreement. Revenue Neutrality agreements are to ensure that County residents would not be harmed from the fiscal impact of the new city. For Citrus Heights, this was accomplished by allowing the county to retain all Citrus Heights property taxes for the first 25 years of incorporation. It wasn’t until November 5, 1996, after a 12-year battle with the county, when voters approved the measure to incorporate and it became effective January 1, 1997. Citrus Heights' History 3 City Demographics 2016 2017 2018 2019 2020Population Growth Over Time Bachelor's Degree Median Age of Citizens Population 87,160 High School Degree90.3%20.4% 38.0 Who Makes up the City? 4 Millennials20,413 Retiring Soon26,969 Median Housing Price Total Labor Force City Statistics Per Capita Personal Income$30,729$403,455 Total City Area Total Street Miles 14.2 Mi 237 Mi 9.0% Unemployment Rate How Expensive is the City? 43,400 $76.0K Avg. Earnings Per Job 2 5 Net Position 2021Summary The Statement of Net Position provides information about the financial position of the City as a whole; much like a balance sheet does for a corporation. It represents the difference between all of its assets (everything the City owns) and its liabilities (everything the City owes) on an accrual basis. It is an indication of the City’s financial health at the end of each fiscal year. All of the City’s activities are grouped into Governmental Activities and Business-type activities in order to provide a summary of these two activities of the City as a whole. Governmental activities: The City’s basic services that are supported by general City revenues are considered governmental activities, including general government, community development, economic development, public safety, public improvements, and etc. Business-type activities: City services that are supported by charges paid by users based on the amount of the service they use. Net investment in Capital Assets: Represents the difference between the amount paid for capital assets (such as equipment and buildings), the accumulated depreciation of those assets, and any outstanding debt used to pay for them. 6 Restricted: Funds that are not available for City use because they must be used for a specific purpose or project as required by law or regulation. Unrestricted: The remaining balance available foruse that is not invested capitalassets or restricted. Deferred Outflows:Represents a consumption of net assets by the City that is applicable to a future reporting period. Deferred Inflows: Represents an acquisition of net assets by the City that is applicable to a future reporting period. 2021 Net Position$ 338,846,023 2021 RestrictedFunds $ (6,506,248) Decreased by: $ 3,617,504 2021 UnrestrictedFunds $ 25,779,873 General Fund Year Change in Fund Balance Fund Balance 2015 $ (8,918,442)$ 20,436,966 2016 $ (1,360,955)$ 19,076,011 2017 $ (13,357,576)$ 5,718,435 2018 $ (544,643)$ 5,713,792 2019 $ 1,356,736 $ 6,530,126 2020 $ (1,250,402)$ 5,280,126 2021 $ 3,610,700 $ 8,890,826 7 Revenue Expenditure Change in Fund Balance The General Fund is the chief operating fund of the City. The actual total revenues were approximately $6,196,053 more than the final budgeted amount. Investment earnings, contributions, and fines and forfeiturescame in under budget; all other revenue categories exceeded the budget estimate. The largest favorablevariance compared to the budget was in intergovernmental revenues, $3,565,067. This includes one-time CARES Act Relief funds and funding for the Great Plates program. An increase in general sales tax revenue was due to the re-opening of local businesses that had shut down or been impacted by the COVID-19 pandemic. Anincrease in charges for services was due to the inflationary changes from the City Council approved Master FeeSchedule effective January 1, 2020. 2021 General Fund Fund Balance $ 8,890,826 Reserves and Revenue Stabilization $ 4,486,978 Fund Balance Increased by: $ 3,610,700 0 $ $ $ $ $ $ $ Statement ofActivities The City’s financial planning promotes long-term planning of its resources that is reflective of community priorities,essential services, and quality of life. The ten-year financial forecast has served as the primary budget guidance toolsince the City’s incorporation in 1997. The forecast is updated annually to project future General Fund revenue andexpenditure. Several factors directly affect the City’s General Fund revenue. Since the City currently receivesapproximately 40% of its General Fund revenue from sales and use tax, it is especially susceptible to economicdownturns and the changing retail economy. In addition, the City is approximately 98% built out which results in feweropportunities for revenue generating growth. The City will continue to balance the General Fund by implementing acombination of cost saving measures as well as prudent financial planning. 8 General Government Public Safety Economic Development Culture and Recreation Public Ways& Facilities Community Enhancement Long-term Debt Total Expenses Charges for Services Operating Contributions and Grants Capital Contributionsand Grants Other Governmental Activities Expenses & Revenue Sources Revenues Sales and Use Taxes Charges for Services Operating Grants Shared Intergovernmental - Unrestricted Capital Grants Utility Users Tax Other Taxes Property Taxes 17.45 % 20.77 % 21.51 % 25.09 % 2.62 % 6.73 % 5.10 % 0.72 % Four Major Sources of Revenue Inter-governmental Revenues Operating Grants SalesTax Capital Grants Annual receipts for the fiscal year ended June 30, 2021, increased by $1,289,647 from the prior year due to some new businesses in the city and the re-opening of some businesses that previously had to shut due to the pandemic. Annual receipts for the fiscal year ended June 30, 2021, increased by $416,490 from the prior year. This amount represents the state motor vehicle in-lieu tax. Governmental Activities operating grants and contributions were mainly from public safety street, road, and community enhancement grants that were for maintenance and operations as well as CARES Act allocations for CDBG Supplemental and DOJ for public safety. The amounts also included the CARES Act Relief funding for cities and the Great Plates program. The decrease in capital revenues reflects closure of capital projects in the prior fiscal year. During the fiscal year ended June 30, 2021, only a handful of projects remained open/under construction. 9 The City’s total revenues for governmental and business-type activities were $54,292,429 for the fiscal year ended June 30, 2021. Approximately 70% of the City’s key revenues are generated from four major sources. $ 57,177,009 Total Expenses $ 57,909,936 Governmental Activity Business - typeActivity $ 732,927 Historical Trend of Revenues and Expenses Expenditures 2015 2016 2017 2018 2019 2020 2021 2021 Expenses by Function PublicSafety Public Ways and Facilities General Government Culture andRecreation Community Enhancements Economic Development Interest $ 10,210,576$ 18,149,133 $ 23,338,398 $ 540,427 $ 3,877,993 $ 916,027 $ 144,455 Expenses (Includes Governmental and Business-type Activities Expenses) Revenue (Includes Program, General and Business-type Activities Revenues) 10 Governmental and business-type activity expenses of the City for the year totaled $57,909,936. Governmental activity expenses totaled $57,177,009 or 98.7% of total expenses. Business-type activities expenses totaled $732,927 during the fiscal year. Public safety costs represented 40.8% of total governmental activities expenses and represented the largest single expense for governmental activities. $ 59,468,705 $ 46,123,384 $ 62,185,422 $ 53,880,976 $ 54,612,588 $ 47,840,767 $ 58,692,015 $ 45,734,705 $ 58,515,265 $ 51,087,400 $57,361,658 $ 48,059,304 $ 57,909,936 $ 54,292,429 Poor Very Poor Fair Good Pavement Condition Index (PCI) 0 25 50 70 100 City Roads & Repairs In April 2020, City staff presented a summary and report on the state of repair in our city from the City’s Pavement Management System Study Session. The city worked with local pavement management experts and included hands-on in the field evaluations of every single publicly maintained street within the City. It concluded that we are leveraging a score of 53 out of 100 on the Pavement Condition Index (PCI) which is just three points above a poor rating according industry standards. Currently, the city budget includes approximately $2.1 million annually, or $21.4 million between 2020 and 2029, to be used towards repaving our roads. This budgeted amount is not sufficient to maintain an average PCI rating of 53, must less improve it. Overtime, it is projected to decrease to an average PCI of 35 by 2029, well below the poor threshold of industry standards. 11 Current City PCI Rating 53 Condition Percentage of City Roads Poor Fair Good Costly Deferred Maintenance The city would need to increase its annual investment in road maintenance to $9.3 million to prevent further deterioration and maintain the City’s average PCI at 53. While this would stop the systematic problem of short-term solutions it does not fix everything. Continued... It would cost approximately $54.9 million in order to repair our roads up to the acceptable average PCI of 70. At the current rate of investment in road maintenance and with the continued deterioration of the roads over time, the estimated cost of maintenance increases from $54.9 million in 2020 to $186.9 million in 2029. 12 Declining Pavement Conditions 2020 Accessibility & Drainage Maidstone Way & Fleetwood Dr at Madison Ave. Tupelo Dr. & Daly Ave. Before After 13 This Project constructed accessibility and drainage upgrades throughout the city including: •13,541 square feet of sidewalk •3,114 linear feet of curb and gutter •3 storm drain manholes •15 storm drain inlets •774 linear feet of storm drain pipe •28 new ADA compliant curb ramps Replacing and upgrading storm drain infrastructure reduces localized flooding while increasing storm drain system longevity. Construction of ADA compliant curb ramps, sidewalk, curb & gutter help increase accessibility and promote active transportation within the community by providing safe and convenient facilities. Before After After Before Improved accessibility for citizens through a new ramp. Better accessibility and drainage for residents of Tupelo Dr. New Drain Pipes Major Project Completed Storm Drain Repairs Great Plates $ 2.4 Million COVID - 19 The City of Citrus Heights participated in the Great Plates Delivered Program. This program was a meal delivery service for local, at-risk seniors who were homebound due to the COVID-19 pandemic. It was funded by the City and the Federal Emergency Management Agency (FEMA) and administered by the California Office of Emergency Services (CalOES). Between May 2020 and January 2021, the city and seven of its local restaurants were able to serve over 100,000 meals to nearly 200 residents and invested approximately $2.4 million into the Citrus Heights economy. May 2020 to January 2021 The Coronavirus Aid, Relief, and Economic Security (CARES) Act (2020) provided fast and direct economic assistance for American workers, families, small businesses, and industries. It was implemented through a variety of programs to address issues related to the onset of the COVID-19 pandemic however the City of Citrus Heights only received funding from two sources. One the of the programs to receive CARES Act funding was the Community Development Block Grant (CDBG) program that is administered through the U.S. Department of Housing and Urban Development (HUD). Under this program, the city was able to partner with local non-profits to provide food and housing for those in need within the community. For example, Sunrise Food Ministry and Meals on Wheels provided food services while Rebuilding Together Sacramento administered the city’s Critical Home Repair Program. The second funding source was passed through from the State of California via the Coronavirus Relief Fund Allocations to cities. The City of Citrus Heights received $1,084,214 and used these funds to pay for increased public safety and city expenditures related directly to the COVID-19 pandemic. CARES Act Relief Funding 14 Contact Us Join Us 6360 Fountain Square Drive Citrus Heights, CA 95621 Phone: 916-725-2448 TTY/DD: CA Relay Service 7-1-1 Fax: 916-725-5799 Facebook Twitter Instagram Youtube Nextdoor Sign up for News @CityofCHeights cityofcitrusheights COCitrusHeights