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1992-1993 CAFR _ CITY OF CHINO HILLS Annual Financial Report Fiscal Year Ended June 30, 1993 S S I --I L L Moreland &„( ikto CERTIFIED PUBLIC ACCOUNTANTS • CITY OF CHINO HILLS Annual Financial Report Year Ended June 30, 1993 TABLE OF CONTENTS PAGE INDEPENDENT AUDITORS' REPORT 1 GENERAL PURPOSE FINANCIAL STATEMENTS: Combined Balance Sheet - All Fund Types and Account Groups 2 Combined Statement of Revenues, Expenditures and Changes in Fund Balances - All Governmental Fund Types 6 Combined Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual - All Governmental Fund Types 8 Combined Statement of Revenues, Expenses and Changes in Retained Earnings - All Proprietary Fund Types 11 Combined Statement of Cash Flows - All Proprietary Fund Types 12 Notes to Financial Statements 13 SUPPLEMENTARY INFORMATION: All Special Revenue Funds Combining Balance Sheet 48 Combining Statement of Revenues, Expenditures and Changes in Fund Balance 50 All Capital Projects Funds Combining Balance Sheet 52 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 56 All Agency Funds Combining Balance Sheet 60 610 NEWPORT CENTER DRIVE,SUITE 840 NEWPORT BEACH,CALIFORNIA 92660 Moreland &,);4cuu - (714)760-9788 CERTIFIED PUBLIC ACCOUNTANTS 2111 PALOMAR AIRPORT ROAD,SUITE 150 CARLSBAD,CALIFORNIA 92009 (619)431-8476 May 6, 1994 The Honorable City Council of the City of Chino Hills Independent Auditors' Report We have audited the accompanying general purpose financial statements of the City of Chino Hills, California, as of and for the year ended June 30, 1993, as listed in the table of contents. These financial statements are the responsibility of the City of Chino Hills' management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the City of Chino Hills at June 30, 1993, and the results of its operations and the cash flows of its proprietary fund types for the year then ended, in conformity with generally accepted accounting principles. Our audit was made for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The accompanying combining financial statements listed as supplementary information in the table of contents are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the City of Chino Hills. The information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. / , Of / /. 1 CITY OF CHINO HILLS Combined Balance Sheet All Fund Types and Account Groups June 30, 1993 Governmental Fund Types Special Debt Capital General Revenue Service Projects Assets and Other Debits Fund Funds Fund Funds Cash and investments(Note 2) $ 4,520,404 $ 21,539,331 $ 29,357,136 Cash and investments with fiscal agents(Note 2) $ 253,967 218 Restricted cash and investments(Note 2) 2,584,000 Deposit with others(Note 12) Receivables (net,where applicable of allowance): Accounts 6,454 Interest 61,096 378,124 541,536 Taxes 60,700 40,326 Special assessment receivable — current 381,677 185,514 Deferred special assessments receivable 645,238 Lease payments receivable(Note 13) Installment receivable (Note 14) Due from other funds (Note 3) 49,984 Materials and supplies inventories Advances to other funds 50,000 Property, plant and equipment,net(Note 4) Deferred issuance costs Unamortized bond discount Investment in Water Facilities Authority(Note 12) Amount available for long—term debt Amount to be provided for retirement of long—term debt Total Assets and Other Debits $ 7,664,315 $ 22,838,533 $ 253,967 $ 29,898,890 Liabilities,Equity and Other Credits Liabilities: Accounts and contracts payable $ 442,582 $ 1,484,103 $ 4,795,603 Advances from developers (Note 9) Due to other funds (Note 3) 3,822 101,284 16,324 Salaries and benefits payable 144,732 45,561 2,448 Deferred compensation payable(Note 7) Funds held for others Customer deposits 2,065,591 Notes payable 2,500,825 See Accompanying Notes to Financial Statements. 2 Proprietary Fiduciary Fund Fund Type Account Groups General General Totals Enterprise Agency Fixed Long—Term (Memorandum Fund Fund Assets Debt Only) $ 12,733,742 $ 23,247,704 $ 91,398,317 12,432 1,986,785 2,253,402 2,584,000 205,078 205,078 1,127,151 1,133,605 176,679 450,983 1,608,418 101,026 242,184 809,375 645,238 2,741,641 2,741,641 2,501,584 2,501,584 91,734 141,718 347,871 347,871 50,000 53,169,793 $ 14,853,043 68,022,836 161,737 161,737 426,360 426,360 5,422,712 5,422,712 $ 253,967 253,967 37,594,109 37,594,109 $ 79,118,514 $ 25,927,656 $ 14,853,043 $ 37,848,076 $ 218,402,994 $ 1,304,893 $ 952,245 $ 8,979,426 $ 3,568,531 3,568,531 6,304 13,984 141,718 102,185 294,926 4,282 4,282 24,957,145 24,957,145 572,916 2,638,507 2,500,825 (Continued) 3 CITY OF CHINO HILLS Combined Balance Sheet All Fund Types and Account Groups (Continued) June 30, 1993 Governmental Fund Types Special Debt Capital General Revenue Service Projects Liabilities,Equity and Other Credits Fund Funds Fund Funds (Continued) Due to Chino Basin Municipal Water District(Note 9) Advances from other funds 50,000 Capital lease obligations(Note 9) Certificates of participation (Note 9) Installment obligation due enterprise fund(Note 9) Installment obligation due Inland Empire Public Facilities Corporation(Note 9) Installment obligation due Water Facilities Authority(Note 9) Accrued interest payable to Inland Empire Public Facilities Corporation Development fee program obligations(Note 9) Claims payable(Note 9) Advances for construction (Note 9) Employee compensated absences(Note 9) Total Liabilities 5,207,552 1,630,948 4,814,375 Equity and Other Credits: Investment in general fixed assets Contributed capital(Note 15) Retained earnings Fund balances: Reserved(Note 18) 375,460 3,282,491 $ 253,967 10,516,378 Unreserved,designated (Note 18) 1,216,615 Unreserved,undesignated 2,081,303 16,708,479 14,568,137 Total Equity and Other Credits 2,456,763 21,207,585 253,967 25,084,515 Total Liabilities,Equity and Other Credits $ 7,664,315 $ 22,838,533 $ 253,967 $ 29,898,890 See Accompanying Notes to Financial Statements. 4 Proprietary Fiduciary Fund Fund Type Account Groups General General Totals Enterprise Agency Fixed Long—Term (Memorandum Fund Fund Assets Debt Only) 5,453,386 5,453,386 50,000 63,858 63,858 2,490,000 2,490,000 2,501,584 2,501,584 20,060,000 20,060,000 2,306,528 2,306,528 112,002 112,002 5,908,186 27,955,299 33,863,485 1,181,532 1,181,532 556,926 556,926 151,130 151,130 36,447,184 25,927,656 37,848,076 111,875,791 $ 14,853,043 14,853,043 35,933,932 35,933,932 6,737,398 6,737,398 14,428,296 1,216,615 33,357,919 42,671,330 14,853,043 106,527,203 $ 79,118,514 $ 25,927,656 $ 14,853,043 $ 37,848,076 $ 218,402,994 5 CITY OF CHINO HILLS Combined Statement of Revenues,Expenditures and Changes in Fund Balances — All Governmental Fund Types For the Year Ended June 30, 1993 Special Debt General Revenue Service Revenues: Taxes (Note 5) $ 4,578,743 Special assessment taxes 139,227 $ 6,452,950 Licenses and permits 1,013,514 Use of money and property 402,554 1,230,312 $ 64,752 Intergovernmental 1,332,403 Development fees 7,250,505 Contributions from developers Charges for services 398,031 Fines and forfeitures 81,839 Other 535,172 61,724 Total Revenues 7,149,080 16,327,894 64,752 Expenditures: Current: General government 2,635,187 29 Public safety 3,024,789 257,309 Public works 1,128,706 7,933,745 Community development 1,072,272 Capital outlay 140,612 2,825,753 Debt service: Principal retirement 5,919,680 Interest and fiscal charges 283,808 62,931 Total Expenditures 8,001,566 17,220,324 62,931 Excess(Deficiency) of Revenues Over Expenditures (852,486) (892,430) 1,821 Other Financing Sources (Uses): Proceeds from long—term debt 2,592,317 252,146 Operating transfers in 2,039,934 4,347,322 Operating transfers out (6,901,685) Total Other Financing Sources (Uses) 2,039,934 37,954 252,146 Excess(Deficiency) of Revenues and Other Financing Sources Over Expenditures and Other Financing Uses 1,187,448 (854,476) 253,967 Fund Balances — Beginning of Year, Restated(Note 17) 399,207 18,078,875 Equity transfers in(out) (Note 18) 870,108 3,983,186 Fund Balances — End of Year $ 2,456,763 $ 21,207,585 $ 253,967 See Accompanying Notes to Financial Statements. 6 Capital Totals Projects (Memorandum Only) $ 4,578,743 6,592,177 1,013,514 $ 1,995,226 3,692,844 1,332,403 7,250,505 3,212,278 3,212,278 398,031 81,839 36,711 633,607 5,244,215 28,785,941 2,635,216 3,282,098 4,394,402 13,456,853 1,072,272 4,823,059 7,789,424 1,350,718 7,270,398 76,074 422,813 10,644,253 35,929,074 (5,400,038) (7,143,133) 2,198,828 5,043,291 3,363,802 9,751,058 (2,125,040) (9,026,725) 3,437,590 5,767,624 (1,962,448) (1,375,509) 32,296,664 50,774,746 (5,249,701) (396,407) $ 25,084,515 $ 49,002,830 7 CITY OF CHINO HILLS Combined Statement of Revenues,Expenditures and Changes in Fund Balances - Budget and Actual All Governmental Fund Types For the Year Ended June 30, 1993 General Fund Variance Favorable Budget Actual (Unfavorable) Revenues: Taxes (Note 5) $ 3,954,756 $ 4,578,743 $ 623,987 Special assessment taxes 129,000 139,227 10,227 Licenses and permits 719,100 1,013,514 294,414 Use of money and property 39,996 402,554 362,558 Intergovernmental Development fees Contributions from developers Charges for services 837,000 398,031 (438,969) Fines and forfeitures 19,992 81,839 61,847 Other 247,188 535,172 287,984 Total Revenues 5,947,032 7,149,080 1,202,048 Expenditures: Current: General government 2,834,544 2,635,187 199,357 Public safety 2,958,780 3,024,789 (66,009) Public works 1,749,768 1,128,706 621,062 Community development 1,156,476 1,072,272 84,204 Capital outlay 195,312 140,612 54,700 Debt service: Principal retirement Interest and fiscal charges Total Expenditures 8,894,880 8,001,566 893,314 Excess(Deficiency) of Revenues Over Expenditures (2,947,848) (852,486) 2,095,362 Other Financing Sources (Uses): Proceeds of long-term debt Operating transfers in 4,027,476 2,039,934 (1,987,542) Operating transfers out Total Other Financing Sources (Uses) 4,027,476 2,039,934 (1,987,542) Excess(Deficiency) of Revenues and Other Financing Sources Over Expenditures and Other Financing Uses 1,079,628 1,187,448 107,820 Fund Balances - Beginning of Year, Restated(Note 17) 399,207 399,207 Equity transfers in (out) (Note 18) 411,000 870,108 459,108 Fund Balances - End of Year $ 1,889,835 $ 2,456,763 $ 566,928 See Accompanying Notes to Financial Statements. 8 Special Revenue Funds Debt Service Fund Variance Variance Favorable Favorable Budget Actual (Unfavorable) Budget Actual (Unfavorable) $ 6,731,724 $ 6,452,950 $ (278,774) 1,041,144 1,230,312 189,168 $ 64,752 $ 64,752 1,167,180 1,332,403 165,223 8,638,692 7,250,505 (1,388,187) 117,792 61,724 (56,068) 17,696,532 16,327,894 (1,368,638) 64,752 64,752 113,076 29 113,047 257,309 (257,309) 21,687,688 7,933,745 13,753,943 5,091,636 2,825,753 2,265,883 5,919,680 (5,919,680) 283,808 (283,808) 62,931 (62,931) 26,892,400 17,220,324 9,672,076 62,931 (62,931) (9,195,868) (892,430) 8,303,438 1,821 1,821 263,796 2,592,317 2,328,521 252,146 252,146 6,443,376 4,347,322 (2,096,054) (17,222,412) (6,901,685) 10,320,727 (10,515,240) 37,954 10,553,194 252,146 252,146 (19,711,108) (854,476) 18,856,632 253,967 253,967 18,078,875 18,078,875 3,983,186 3,983,186 $ (1,632,233) $ 21,207,585 $ 22,839,818 $ — $ 253,967 $ 253,967 (Continued) 9 CITY OF CHINO HILLS Combined Statement of Revenues,Expenditures and Changes in Fund Balances — Budget and Actual All Governmental Fund Types (Continued) For the Year Ended June 30, 1993 Capital Projects Funds Variance Favorable Budget Actual (Unfavorable) Revenues: Taxes Special assessment taxes Licenses and permits Use of money and property $ 1,157,268 $ 1,995,226 $ 837,958 Intergovernmental Development fees Contributions from developers 3,212,278 3,212,278 Charges for services Fines and forfeitures Other 8,600,592 36,711 (8,563,881) Total Revenues 9,757,860 5,244,215 (4,513,645) Expenditures: Current: General government Public safety Public works 12,981,012 4,394,402 8,586,610 Community development 6,780 6,780 Capital outlay 37,777,548 4,823,059 32,954,489 Debt service: Principal retirement 378,396 1,350,718 (972,322) Interest and fiscal charges 76,074 (76,074) Total Expenditures 51,143,736 10,644,253 40,499,483 Excess(Deficiency) of Revenues Over Expenditures (41,385,876) (5,400,038) 35,985,838 Other Financing Sources (Uses): Proceeds of long—term debt 2,198,828 2,198,828 Operating transfers in 11,956,308 3,363,802 (8,592,506) Operating transfers out (793,992) (2,125,040) (1,331,048) Total Other Financing Sources (Uses) 11,162,316 3,437,590 (7,724,726) Excess(Deficiency) of Revenues and Other Financing Sources Over Expenditures and Other Financing Uses (30,223,560) (1,962,448) 28,261,112 Fund Balances — Beginning of Year, Restated(Note 17) 32,296,664 32,296,664 Equity transfers in (out) (Note 18) (5,249,701) (5,249,701) Fund Balances — End of Year $ 2,073,104 $ 25,084,515 $ 23,011,411 See Accompanying Notes to Financial Statements. 10 CITY OF CHINO HILLS Combined Statement of Revenues,Expenses and Changes in Retained Earnings All Proprietary Fund Types For the Year Ended June 30, 1993 Operating Revenues: Water sales $ 6,605,534 Sanitation services 2,552,635 Permit and inspection fees 101,816 Meter and installation fees 157,391 Total Operating Revenues 9,417,376 Operating Expenses: Purchased water 2,272,361 Salaries and benefits 1,053,460 Utilities 521,358 Professional services 2,339,204 Depreciation and amortization 1,565,493 Repairs and maintenance 248,167 Services and supplies 78,652 Other general and administrative 57,105 Total Operating Expenses 8,135,800 Operating Income 1,281,576 Non—Operating Revenues(Expenses): Equity in earnings of Water Facilities Authority(Notes 9 and 12) (394,045) Interest earnings 721,269 Tax and assessment revenue 1,604 Other non—operating revenue 330,767 Other non—operating expense (74,386) Interest expense (769,851) Total Non—Operating Revenues (Expenses) (184,642) Net Income Before Operating Transfers 1,096,934 Operating transfers in 265,035 Operating transfers out (989,368) Net Income 372,601 Depreciation Expense on Contributed Assets 69,379 Retained Earnings,Beginning of Year,as Restated(Note 17) 6,295,418 Retained Earnings,End of Year $ 6,737,398 See Accompanying Notes to Financial Statements. 11 CITY OF CHINO HILLS Combined Statement of Cash Flows All Proprietary Fund Types For the Year Ended June 30, 1993 Cash Flows from Operating Activities: Operating income $ 1,281,576 Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation and amortization 1,565,493 Changes in assets and liabilities: Increase in accounts receivable (238,575) Increase in due from other funds (48,612) Increase in materials and supplies inventory (9,209) Increase in accounts and construction contracts payable 438,126 Increase in salary and benefits payable 53,236 Increase in customer deposits 32,200 Increase in due to other funds 6,304 Net Cash Provided by Operating Activities 3,080,539 Cash flows used for noncapital financing activities — Operating transfers (724,333) Cash Flows from Capital and Related Financing Activities: Payment to Inland Empire Public Facilities Corporation (300,000) Loan from Chino Basin Municipal Water District 1,134,861 Repayment of advances for construction (140,539) Repayment of inspection deposits (1,057,348) Payment of developer program obligations (981,699) Contributed capital received 1,153,465 Bond interest paid (796,728) Capital lease payments (59,165) Purchases of property, plant and equipment (888,571) Lease payments received 165,540 Net Cash Used for Capital and Related Financing Activities (1,770,184) Cash Flows from Investing Activities: Interest received 640,449 Other 220,021 Net Cash Provided for Investing Activities 860,470 Increase in cash and cash equivalents 1,446,492 Cash and Cash Equivalents at Beginning of Year 11,299,682 Cash and Cash Equivalents at End of Year(Note 2) $ 12,746,174 See Accompanying Notes to Financial Statements. 12 CITY OF CHINO HILLS Notes to Financial Statements June 30, 1993 1. SIGNIFICANT ACCOUNTING POLICIES Description of the Reporting Entity: The City of Chino Hills (the "City") was incorporated December 1, 1991 under the General Laws of the State of California. The City is comprised of a combination of the San Bernardino County Service Area No. 70, Zone Chino Hills, portions of the County of San Bernardino, and San Bernardino County Waterworks No. 8. The City operates under a Council-Manager form of government and provides the following services: contracted police, lighting and landscaping, public improvements, water, sanitation, planning and zoning and general administrative services, animal control, building and safety, community services and street and highway maintenance. The accompanying financial statements include the financial activities of the City and the Chino Hills Capital Improvement Corporation (Corporation). The Corporation, a California nonprofit public benefit corporation, was established on May 19, 1992 to facilitate the financing of capital improvements on behalf of the City of Chino Hills. Financial information for the Corporation is accounted for in the City's financial statements in accordance with principles defining the governmental reporting entity adopted by the Governmental Accounting Standards Board. City Council members, in separate session, serve as the governing board of the Corporation. There are no other separate legal entities with accounting activities over which the City Council had continuing oversight responsibility or otherwise meet the criteria for inclusion. The oversight responsibility is determined on the basis of budget adoption, taxing authority, funding and appointment of the governing board. There are many other governmental agencies, including the Chino Valley Independent Fire Protection District, the County of San Bernardino, and the Chino Hills Unified School District providing services within the City. These other governmental agencies have independently elected governing boards and consequently are not under the direction of the City. Financial information for these agencies is not included in the accompanying financial statements. Governmental Fund Types: General Fund is used to account for all revenues and activities financed by the City which are not accounted for in another fund. Special Revenue Funds are used to account for taxes and other revenues which are set aside for a specific purpose in accordance with law or administrative regulation. 13 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Debt Service Fund is used to account for the current interest and principal payments on the Chino Hills Improvement Corporation Certificates of Participation. Capital Projects Funds are used to account for resources used for the acquisition and construction of major capital facilities. Proprietary Fund Types: Enterprise Fund is used to account for operations that are financed and operated in a manner similar to private business enterprises, where the stated intent is that the cost of providing goods and services to the general public on a continued basis be financed or recovered through user charges. Fiduciary Fund Type: Agency Funds are used to account for money and property held by the City as trustee or custodian. They are also used to account for various assessment districts for which the City acts as an agent for debt service activity, as the City is prohibited from levying additional taxes for these districts. Account Groups: General Fixed Assets Account Group is used to account for capital assets of the City which are long-term in nature, and used in the operation of the City other than those which are capitalized in the proprietary fund. General Long-Term Debt Account Group is used to account for the City's outstanding long-term obligations other than those which are included in the proprietary fund. Measurement Focus and Basis of Accounting: The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. 14 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 The proprietary fund is accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and all liabilities associated with the operation of the fund are included on the balance sheet. Fund equity (i.e., net total assets) is segregated into contributed capital and retained earnings components. Proprietary fund-type operating statements present increases (e.g., revenues) and decreases (e.g., expenses) in net total assets. The modified accrual basis of accounting is followed for the governmental and fiduciary fund types (General, Special Revenue, Debt Service, Capital Projects and Agency Funds). Under the modified accrual basis of accounting, revenues are recognized when they become susceptible to accrual; i.e., when they become measurable and available to finance expenditures of the current period or soon enough thereafter to be used to pay liabilities of the current period. The City considers property taxes as available if they are remitted within 60 days after the year end. Other revenues considered susceptible to accrual include sales taxes, interest income and charges for services. Licenses and permits, fines and forfeitures and other taxes are not susceptible to accrual because they are not measurable until received in cash. Grant revenues have been recorded according to the provisions of GASB Cod. Sec. G60, whereby grant funds earned but not received are recorded as a receivable, and grants received before the related revenue recognition criteria have been met are reported as deferred revenues. Expenditures are recorded when the related fund liability is incurred, except that principal and interest on general long-term debt is recognized when due. The long-term liability to be paid from governmental funds' resources for accumulated unpaid vacation, sick pay, and compensatory time is recorded in the General Long-Term Debt Account Group as it is expected to be paid from future resources. The full accrual method of accounting is followed by the City's proprietary fund type (Enterprise). Revenues are recognized when earned, and expenses are recognized when incurred. Unbilled receivables are recorded at year end. Budget Procedures: All financial activities of the General Fund, Special Revenue Funds, Debt Service Fund and Capital Projects Funds are part of the appropriated budget. Appropriated amounts are as originally adopted or as amended by the City Council throughout the year. The following general procedures are followed in establishing the annual budget: 1) The annual budget adopted by the City Council provides for the general operation of the City. It includes proposed expenditures and estimated revenues. 15 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 2) The City Manager is authorized to transfer appropriations between items, accounts,programs, and funds. The budgeted amounts used in the combined financial statements are the final adjusted amounts, which do not vary significantly from the original adopted budget. 3) The budget is formally integrated into the accounting system and employed as a management control device during the year for all funds. 4) The budget is adopted on an annual basis. 5) The budget is adopted on a basis consistent with generally accepted accounting principles. The modified accrual basis of accounting is employed in the preparation of the budget. 6) At fiscal year-end, operating budget appropriations lapse; however, incomplete capital improvement project appropriations within Capital Projects Funds, and authorized non-capital appropriations, can be carried over to the following fiscal year as approved by the City Council. 7) The legally adopted budget requires that expenditures not exceed appropriations at the City level. Encumbrances: Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriations, is employed as an extension of formal budgetary integration in governmental funds. Amounts encumbered at year-end are reappropriated in the following year. Investments: Investments are stated at cost except for investments of the deferred compensation plan which are stated at market value. (See Notes 2 and 7). Materials and Supplies Inventories: Materials and supplies consist of water pipe, meters, valves, tools and miscellaneous items used in installing, monitoring and repairing these items. The water pipe, meters, valves and long-term items are removed from inventory and capitalized as fixed assets and depreciated upon installation. The remaining items are recorded as expenditures when used in accordance with the consumption method. Inventories are capitalized at the lower of cost or market on a FIFO (first-in, first-out) basis. 16 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 General Fixed Assets: General fixed assets are recorded as expenditures in the various governmental funds at the time of purchase. Such assets include land, buildings, building improvements, furniture, fixtures, and equipment, and are capitalized at historical cost in the General Fixed Assets Account Group. Donated fixed assets are recorded at their fair market value on the date donated. The cost of roads and streets, bridges, curbs and gutters, and lighting systems are not capitalized. No depreciation is provided on general fixed assets. Enterprise Fund Fixed Assets: Fixed assets purchased for the Enterprise Fund are capitalized at cost, while contributed assets are recorded at fair market value at the time received. Depreciation has been provided on a straight-line basis over their estimated useful lives as follows: Equipment 3 - 12 years Vehicles 4 - 10 years Utility Plant in Service 5 - 100 years Meters 30 years Pipeline in Service 40 - 75 years Interest costs related to debt, the proceeds of which are used for the construction of fixed assets, are capitalized as part of construction costs in the Enterprise Fund. During the current year, these capitalized interest costs amounted to $741,458, and are reflected in construction in progress. Interest expense incurred in connection with construction of capital assets has been reduced by interest earned on the investment of funds borrowed for construction in accordance with Statement of Financial Accounting Standards No. 62. Compensated Absences: The City is obligated to compensate employees for all earned but unused vacation days accumulated. Liabilities for vacation, sick pay and compensatory time are recorded when earned. Compensated absence liabilities are reported in the General Long-Term Debt Account Group as it is expected that they will be paid with future resources. City employees receive from 10 to 20 vacation days each year, depending upon length of service. Vacation benefits, sick leave, and compensatory time are recorded as expenditures in the related funds when used. 17 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 At June 30, 1993, the liability amounted to $151,130, and has been recorded as general long-term debt. Deferred Issuance Costs: Deferred issuance costs represent capitalized costs incurred in connection with the issuance of long-term debt. These costs are amortized on a straight-line basis, which approximates the interest method. Amount Balance at June 30, 1992 $168,294 Amortization (6,557) Balance at June 30, 1993 $161,737 Total Column on Combined Statements: The total column on the Combined Financial Statements is captioned "Memorandum Only" to indicate that it is presented only to facilitate financial analysis and such data is not comparable to a consolidation. Data in this column does not present financial position, results of operations, or changes in financial position in conformity with generally accepted accounting principles. Interfund eliminations have not been made in the aggregation of this data. Cash and Cash Equivalents: All cash and investments, except those which are held by fiscal agents, are held in a City pool. These pooled funds are available upon demand and therefore are considered cash and cash equivalents for purposes of the statement of cash flows. Investments held by fiscal agents with an original maturity of three months or less are also considered cash equivalents. Development Fees Development fees represent amounts collected from developers for building permits to begin residential and commercial building construction. Proceeds from such fees are used to fund improvements made in the City. Non-Cash Capital Financing Activities: Related to the City's agreements with developers (See Note 9) the Development Fee Special Revenue Fund contributed fixed assets of$123,272 to the Enterprise Fund. This transaction has been recorded as an equity transfer from the Development Fee Special Revenue Fund and as contributed capital in the Enterprise Fund (See Note 18). 18 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 2. CASH AND INVESTMENTS Cash and investments at June 30, 1993 consisted of the following: Petty Cash $ 1,625 Pooled Deposits: Demand deposits 71,660 Pooled Investments 93,909,032 Cash and Investments with Fiscal Agents 2,253,402 Total Cash and Investments $96,235,719 Of the $96,235,719 total cash and investments, $2,584,000 is restricted for the payment of the 1992 Tax and Revenue Anticipation Notes. The City follows the practice of pooling cash and investments of all funds except for funds required to be held by outside fiscal agents under the provisions of bond indentures and funds in its deferred compensation plan (See Note 7). Interest income earned on pooled cash and investments is allocated monthly to the various funds based on the cash and investment balances. Interest income from cash and investments with fiscal agents and in the deferred compensation plan is credited directly to the related fund. Authorized Investments: Under provision of the City's investment policy, and in accordance with Section 53601 of the California Government Code, the City may invest in the following types of investments: . Securities of the U.S. Government, or its agencies . Certificates of Deposit (or Time Deposits) placed with commercial banks and/or savings and loan associations . Bankers' Acceptances . Commercial Paper . Local Agency Investment Fund (State Pool) . Repurchase Agreements . Other investments that may be authorized through the State of California Government Code 19 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Pooled Deposits/Credit Risk: ' The California Government Code requires California banks and savings and loan associations to secure a City's deposits by pledging government securities as collateral. The market value of pledged securities must equal at least 110% of a City's deposits. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the City's total deposits. The City may waive collateral requirements for deposits which are fully insured up to $100,000 by federal depository insurance. In accordance with GASB Statement 3, deposits are classified as to credit risk by three categories as follows: Category 1: Insured or collateralized with securities held by the entity or by its agent in the City's name. Category 2: Collateralized with securities held by the pledging financial institution's trust department or agent in the City's name. Category 3: Uncollateralized. Credit Risk, Carrying Amount, and Market Value of Investments: The investments that are represented by specific identifiable investment securities are classified as to credit risk by three categories as follows: Category 1: Insured or registered, or securities held by the City or its agent in the City's name. Category 2: Uninsured and unregistered with securities held by the counterparty's trust department or agent in the City's name. Category 3: Uninsured and unregistered with securities held by the counterparty, or by its trust department or agent but not in the City's name. 20 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Investments made by the City are summarized below. Category Carrying Market 1 2 3 Amount Value Pooled Deposits: Demand Deposit Accounts - Bank Balance $100,000 $209,734 $ 309,734 $ 309,734 Add: Deposits in Transit 52,174 52,174 Less: Outstanding Warrants (290,248) (290,248) Book Balance 71,660 71,660 Total Pooled Deposits 100,000 209,734 71,660 71,660 Pooled Investments: State of California Local Agency Investment Fund * 14,972,128 14,972,128 Los Angeles County Pool * 11,767,900 11,767,900 San Bernardino Country Pool * 67,169,004 67,169,004 Total Pooled Investments 93,909,032 93,909,032 Cash and Investments with Fiscal Agents: Mutual Funds * 2,253,402 2,253,402 Petty Cash 1.625 1,625 Total Cash and Investments $100,000 $209,734 $ - $96,235,719 $96,235,719 * Not subject to categorization 21 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Cash and Investments - Deferred Compensation Plan The City offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The City invests deferred compensation assets with Great Western Bank. The funds are currently invested in mutual funds. Plan assets totaling $4,282 are recorded at market value and are included as a portion of the cash and investments with fiscal agents at June 30, 1993. See Note 7 for additional information about this plan. 3. INTERFUND RECEIVABLES/PAYABLES Receivable Payable General Fund $ 49,984 $ 3,822 Special Revenue Funds: Lighting and Landscape District #1 88,291 Lighting and Landscape District #2 7,388 CSA 9 Development Fee 4,215 FBA 452 Gas Tax 588 Air Quality 35 Federal Grants 16 Measure I 290 Total Special Revenue Funds 101,284 Capital Projects Funds: Special Construction 27 Park Development 139 Parkway Phasing 326 Pomona Construction 1,472 Special Assessment District #85-1 157 Special Assessment District #86-1 903 Special Assessment District #87-1 219 Regional CFD 1,301 Rolling Ridge CFD #1 3 Los Ranchos CFD #2 2,043 The Oaks CFD #4 18 Ricon Village CFD #9 9,716 Total Capital Projects Funds 16,324 22 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Receivable Payable Enterprise Fund 91,734 6,304 Agency Funds: Chino Unified School District 73 Special Assessment District #85-1 4,016 Special Assessment District #86-1 3,971 Special Assessment District #87-1 678 Regional CFD 8 Rolling Ridge CFD #1 1,050 Los Ranchos CFD #2 547 The Oaks CFD #4 922 Canyon Ricon and Woodview CFD #5 456 Carbon Canyon CFD #6 7 Butterfield CFD #8 737 Ricon Village CFD #9 1,477 1915 Act Bonds 42 Total Agency Funds 13,984 Totals $141,718 $141,718 4. PROPERTY, PLANT AND EQUIPMENT Changes in the components of the General Fixed Assets Account Group for the year ended June 30, 1993 were as follows: Original Prior Restated Balance at Period Balance at Balance at June 30, 1992 Adjustments July 1, 1992 Additions Deletions June 30, 1993 Land $11,189,218 $11,189,218 $ 774,840 $11,964,058 Equipment $5,313,907 (5,066,966) 246,941 131,999 $23,835 355,105 Vehicles 349,092 349,092 - 35,801 2,500 382,393 Buildings 1,035,348 1,035,348 1,116,139 2,151,487 Total $5,313,907 $ 7,506,692 $12,820,599 $2,058,779 IAM $14,853,043 The adjustments to arrive at the July 1, 1992 restated balance represent additions to the appropriate categories for park land and improvements, fire station, City hall, library and sheriff station costs which were previously unrecorded assets and to delete costs for infrastructure which were inappropriately capitalized in the prior year. 23 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 A summary of changes in the proprietary fund type property, plant and equipment at June 30, 1993 follows: Original Prior Restated Balance at Period Balance at Balance at June 30, 1992 Adjustments July 1, 1992 Additions Deletions June 30, 1993 Land $ 5,059,943 $(1,985,184) $ 3,074,759 $ 3,074,759 Easements 415,337 110,250 525,587 $ 12,353' 537,940 Utility Plant In Service 8,663,969 6,732,220 15,396,189 2,811,216 18,207,405 Pipeline hi Service 21,521,063 12,979,739 34,500,802 415,659 34,916,461 Meters 687,507 687,507 64,607 p 752,114 Buildings and Improvements 100,000 100,000 30,236' 130,236 Construction in Progress 6,375,780 (3,395,192) 2,980,588 123,272• $2,393,319 710,541 Vehicles 1,197,645 1,197,645 14,292' 39,145 1,172,792 Equipment 983,691 983,691 15302 ' 42,630 956363 Total 44,904,935 14,541,833 59,446,768 3,486,937 2,475,094 60,458,611 Accumulated depreciation _(,5_53 ") (255,939) (5,788,204) (1,558,936) 58,322 (7,288,818) Net $39372,670 $53,658,564 $53,169,793 The adjustments to arrive at the July 1, 1992 restated balance represent a deletion of land (sold to the General Fund) and additions to the appropriate asset categories for previously unrecorded assets acquired in prior years mainly related to the City's development programs (See Note 9). Construction in progress at June 30, 1993 is comprised of assets under construction and includes City yard site improvements and various wells and transmission lines. The City capitalized interest of $741,458 to construction in progress for the fiscal year ended June 30, 1993. 5. PROPERTY TAXES Property taxes are attached as an enforceable lien on property as of March 1. Taxes are levied on July 1 and are payable in two installments on December 10 and April 10. Any unpaid amounts at the end of the fiscal year are recorded as accounts receivable. The County of San Bernardino bills and collects the property taxes and subsequently remits the amount due to the City of Chino Hills in installments during the year. Historically, the City has received substantially all of the taxes levied within two years from the date they are levied. 24 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 The County is permitted by State Law (Article XIII A of the California Constitution) to levy taxes at one percent (1%) of full market value (at time of purchase) and can increase the property's value no more than two percent (2%) per year. In accordance with an agreement with the County, the City receives 6% of the 1% levy. 6. RETIREMENT Plan Description: The San Bernardino County Employees' Retirement Association ("SBCERA") is a defined benefit pension plan (the "Plan") operating under the California County Employees' Retirement Act of 1937. Although legally established as a single employer plan, the City of Big Bear Lake, County Supervisors Association of California and the South Coast Air Quality Management District were later included along with the County of San Bernardino (the "County") and are collectively referred to as the "Participating Members." Substantially all employees of the Participating Members are covered by the plan. For the year ended June 30, 1993 the City of Chino Hills total base salaries for covered employees was $2,867,638. Total payroll for the year was $3,116,311. Employees become eligible for membership on their first day of regular employment and become fully vested after 5 years. General members are eligible for retirement benefits upon completion of 10 years of service and attaining age 50, or 30 years of service regardless of age. Retirement benefits are calculated at 2% of final compensation for each completed year of service based on a normal retirement age of 55 for general members. The plan also provides disability benefits to members and death benefits to beneficiaries of members. Employee and Employer Contribution Obligations: Employees are required to contribute a percentage of their annual compensation to the Plan based on the member's age at entry into the Plan. The City contributes an amount, based on actuarial assumptions, that, together with employee contributions, is intended to provide sufficient reserves for payment of all prospective benefits to members. Employer rates are as follows: Member Rates as a Category Percentage of Base Salaries General members 9.90% Safety members 22.35% 25 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Funding Status and Progress: The amount shown below as the "pension benefit obligation" is a standardized disclosure measure of the present value of pension benefits, adjusted for the effects of projected salary increases and step-rate benefits,estimated to be payable in the future as a result of employee service to date. The measure is intended to help assess the funding status of the system on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons with other public employee retirement systems. The measure is the actuarial present value of credited projected benefits and is independent of the funding method used to determine contributions to SBCERA. The pension benefit obligation was computed as part of an actuarial valuation performed as of June 30, 1992. Significant actuarial assumptions used in the valuation include (a) a rate of return on the investment of present and future assets of 8 percent a year compounded annually, (b) projected salary increases of 5 percent a year compounded annually, attributable to inflation, (c) additional projected salary increases of 1 percent a year, attributable to merit and longevity, (d) pre-and post-retirement mortality based on the 1971 Group Annuity Mortality Table set back one year for men and seven years for women, and (e) cost of living increase of 2 percent per year. The total unfunded pension benefit obligation is not calculated separately for the City; however, the plan's total pension benefit obligation applicable to SBCERA was $1,224,652 at June 30, 1993, (based upon June 30, 1992 data) as follows (in $000's): Pension Benefit Obligation: Retirees and beneficiaries currently receiving benefits and terminated employees entitled to benefits $ 544,464 Current Employees: Employee contributions with interest 220,301 Employer-financed vested 419,163 Employer-financed non-vested 40,724 Total Pension Benefit Obligation 1,224,652 Net Assets Available for Benefits at Cost (Market Value is $1,048,918) 983,894 Unfunded Pension Benefit Obligation LLID2u 26 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Actuarially Determined Contribution Requirements and Contribution Made: SBCERA uses the Projected Unit Credit Normal Cost Method which is an accrued benefit method. That is, it focuses on benefits earned by employees as a result of service through the valuation date. According to this "benefit" method, the normal cost is the actuarial present value on the valuation date of the benefits credited for employee service through that date. SBCERA uses this same method for amortizing any unfunded actuarial liabilities, which ends December 31, 1994. The significant actuarial assumptions used to compute the actuarially determined contribution requirement are the same as those used to compute the pension benefit obligation, as previously described. The contribution to the system for 1993 of$537,218 was made in accordance with actuarially determined requirements computed through an actuarial valuation performed as of June 30, 1992. The City contributed employer contributions of $478,734(16.69 percent of current base salaries); and employee contributions were $58,484 (2.04 percent of current base salaries), of which the City contributed $3,972 (.14 percent of current base salaries). Trend Information: Trend information gives an indication of the progress made in accumulating sufficient assets to pay benefits when due. Within the City's financial statement, ten years of historical trend information are required. 1988-89 is the first year that this actuarial information has been made available by SBCERA. Until ten years of data are available, as many years as are available are presented as follows (in $000's): 1988-89 1989-90 1990-91 1991-92 1992-93 Net Assets Available for Benefits $633,301* $737,515* $794,849 $899,799 $983,894 Pension Benefit Obligation $767,027 %N.*:738 $1,017,149 $1,155,902 $1,224,652 Net Assets Available for Benefits Expressed as a Percentage of the Pension Benefit Obligation 83.0% 82.6% 781% 77.8% 8034% 27 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 1988-89 1989-90 1990-91 1991-92 1992-93 Unfunded Pension Benefit Obligation $133,726 $151,223 $222,300 $256,103 $240,758 Annual Base Salaries $258,073 $280,193 $344,010 $392,683 $435,575 Unfunded Pension Benefit Obligation,Expressed as a Percentage of Annual Base Salaries 51.8% 54.0% 64.6% 652% 553% Participant Member Contnbutions ** ** $44,411 $45,890 $47,404 • Participant Member Contributions Expressed as a Percentage of Annual Base Salaries. These contributions were made in accordance with actuarially determined requirements. ** ** 129% 117% 10.N% * These amounts represent market value. ** This information not available. The City's 1993 contribution represented .636 percent of total contributions required of all participating entities. Part-Time Employee Defined Contribution Plan: The City provides pension benefits for all of its part-time employees through a defined contribution plan. In a defined contribution plan, benefits depend solely on amounts contributed to the plan plus investment earnings. The plan is administered as part of the City's 457 plan. All part-time employees are eligible to participate from the date of employment. Federal legislation requires contributions of at least 7.5 percent to a retirement plan, and City Council resolved to contribute 5 percent. The City's contributions for each employee (and interest earned by the accounts) are fully vested immediately. 28 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 For the year ended June 30, 1993, the City's payroll covered by the plan was $70,658. The City made employer contributions of$1,723 (2.43 percent of current covered payroll), and employees contributed $3,576 (5.07 percent of current covered payroll). These amounts are included in the Agency Fund with the deferred compensation plan of the full-time employees. 7. DEFERRED COMPENSATION PLAN The City offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to all full-time City employees, permits them to defer a portion of their salary until future years. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property, or rights are (until paid or made available to the employee or other beneficiary) solely the property and rights of the City (without being restricted to the provisions of benefits under the plan), subject only to the claims of the City's general creditors. Participants' rights under the plan are equal to those of general creditors of the City in an amount equal to the fair market value of the deferred account for each participant. The City has no liability for losses under the plan but does have the duty of due care that would be required of an ordinary prudent investor. The City believes that it is unlikely that it will use the assets to satisfy the claims of general creditors in the future. Assets of the fund totaled $4,282 at June 30, 1993. 8. INSURANCE PROGRAMS The City is a member of the Southern California Joint Powers Insurance Authority (SCJPIA). See Note 12 for disclosures made in accordance with GASB Cod. Sec. J50.103. General liability insurance: Annual deposits are paid by member cities and are adjusted retrospectively to cover costs. Each member city, including Chino Hills, self-insures through the SCJPIA for the first $20,000 of each loss. However, this self-insurance retention is funded through annual premiums; therefore, the City effectively has no exposure except for specific limits as described herein. Participating cities then share in the next $20,000 to $500,000 per loss occurrence. Specific coverage includes comprehensive and general automotive liability, personal injury, contractual liability, errors and omissions and certain other coverage. Separate deposits are collected from the member cities to cover claims between $500,000 and $10,000,000. These deposits are also subject to retrospective adjustment. 29 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Workers' compensation: The workers' compensation program includes pooling of retained losses plus excess insurance. Annual deposits are paid by member cities and are adjusted retrospectively on an annual basis to cover costs and to reflect claims experience of both the individual member and the pool. The annual retrospective computation of the deposit is based on (1) the member's own losses up to its retention level plus, (2) a pro rata share of all losses from the retention level up to $100,000 plus, (3) a pro rata share of gefieral/administrative expenses and losses between $100,000 and $500,000. Each member City has a specific self- insured retention level depending upon that member's payroll and financial capacity. The City of Chino Hills has a retention level of $50,000, and all claims up to that level are paid by the City. However, this self-insured retention is funded through annual premiums; therefore, the City effectively has no exposure except for specific limits as described herein. Benefits from $50,000 to $500,000 are covered by the pool. Excess insurance covers claims from $500,000 up to the statutory benefits schedule under California Workers' Compensation Law. In addition to this coverage, workers' compensation claims arising out of employer liability are covered up to $5,000,000 per occurrence. 9. CHANGES IN LONG-TERM DEBT The following is a summary of the changes in the General Long-Term Debt Account Group for the year ended June 30, 1993: Original Prior Restated Balance at Period Balance at Balance at June 30, 1992 Adjustments July 1, 1992 Additions Deletions June 30, 1993 Compensated Absences $ 72,948 $ 72,948 $ 78,182 $ 151,130 Advances from Developers 4,921,751 $ (686,259) 4,235,492 $ 666,961 3,568,531 Installment Obligation Due Enterprise Fund 2,501,584 2,501,584 2,501,584 Development Fee Program Obligations 31,744,711 31,744,711 521,000 4,310,412 27,955,299 Claims Payable 1,181,532 1,181,532 Certificates of Participation 2,490,000 2,490,000 Totals $4,994,699 $33,560,036 $38,554,735 $4,270,714 $4,977,373 $37,848,076 30 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 The adjustments to arrive at the July 1, 1992 restated balance were to reclassify a portion of the Advance from Developers to the Development Fee Program Obligations, to record the liability of the Development Fee Program Obligations, and to record the Installment Obligation due to the Enterprise Fund resulting from the sale of land to the General Fund. Compensated Absences: The City's policies relating to compensated absences are described in Note 1 of the Notes to Financial Statements. This liability will be paid in the future years from future resources. $151,130 Advances from Developers: Advances from developers included in the General Long- Term Debt Account Group represent monies owed to developers for development fees collected in advance. The City will repay these developers by allowing them to use the $2,700 credit per unit against their development fees as they obtain their building permit releases. $3,568531 Installment Obligation due Enterprise Fund: In February 1992, City Council approved the sale of land owned by the Enterprise Fund to the General Fund for the construction of the Civic Center. Payment will be made as funds become available. $2,501,584 Development Fee Program Obligations: The City has executed many agreements with outside developers requiring developers to provide funding up front for the costs of backbone infrastructure (major thoroughfares, water and sewer mains, etc.) concurrent with the development of their residential and commercial projects. This up front funding is generally in the form of the developer constructing the backbone infrastructure. Future development fees will be used to reimburse the developers for their up front funding. A liability has been recorded for the project costs incurred to date, including estimated construction in progress. $27,955,299 31 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Claims Payable The City of Chino Hills recently negotiated a settlement with Industry Urban Development Agency related to the acquisition of land and right of ways used for what is now Chino Hills Parkway. The agreement requires payment by the City in the amount of$1,144,000, plus accrued interest on the award through June 30, 1993 of $300,532. The City has previously deposited $213,000 with the City Clerk; therefore the outstanding liability at June 30, 1993 is $1,181,532. This liability will be repaid in ten (10) equal installments of $118,153.24 payable on January 15 of each year, commencing January 15, 1995, plus interest at the rate in effect pursuant to Section 1268.350 of the Code of Civil Procedure. $1,181,532 Chino Hills Capital Improvement Corporation - Certificates of Participation: On September 1, 1992, the Chino Hills Capital Improvement Corporation (Corporation) issued 1992 $2,490,000 Certificates of Participation in order to provide lease financing to the City of Chino Hills for (1) the acquisition and construction of public facilities, (2) a debt service reserve fund, and (3) to pay the costs of issuing the Certificates. Pursuant to the lease agreement between the City and the Corporation, the City is required to pay the Trustee (Bank of America National Trust and Savings Association) specified lease payments for use of the facilities, which amounts are intended to be sufficient in both time and aggregate amount to pay, when due, the principal and interest with respect to the Certificates. The registered Certificates were issued in denominations of $5,000 each or any integral multiple thereof. Interest is payable semi-annually, at rates ranging from 3.7% to 6%, commencing March 1, 1993, and principal is payable annually commencing September 1, 1993 in amounts ranging from $310,000 to $410,000. The Certificates, including portions thereof, maturing on September 1, 1996, and thereafter are subject to redemption and payment prior to maturity, upon instructions from the City, on September 1, 1995 at the respective redemption prices set out below: 32 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Redemption Dates Redemption Price September 1, 1995 and March 1, 1996 102% September 1, 1996 and March 1, 1997 101% September 1, 1997 and each March 1 and September 1 thereafter 100% The debt service requirements to maturity on the Certificates of Participation are as follows: Year Ended June 30, Principal Interest Total 1994 $ 310,000 $108,262 $ 418,262 1995 320,000 95,250 415,250 1996 335,000 91,463 426,463 1997 355,000 73,769 428,769 1998 370,000 54,737 424,737 Thereafter 800,000 46,088 846,088 Totals $2,490,000 $469,569 $2,959,569 The following is a summary of the changes in enterprise fund long-term debt for the year ended June 30, 1993: Original Prior Restated Balance at Period Balance at Balance at June 30, 1992 Adjustments July 1, 1992 Additions Deletions June 30, 1993 Due to Chino Basin Municipal Water District $ 4,318,525 $ 4,318,525 $1,134,861 $ 5,453,386 Capital Lease Obligations 123,023 123,023 $ 59,165 63,858 Installment Obligation Due Inland Empire Public Facilities Corporation 20,360,000 20,360,000 300,000 20,060,000 Installment Obligation Due Water Facilities Authority 2,350,544 2,350,544 44,016 2,306,528 33 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Original Prior Restated Balance at Period Balance at Balance at June 30, 1992 Adjustments July 1, 1992 Additions Deletions June 30, 1993 Advances for construction 697,465 697,465 140,539 556,926 Development Fee Program Obligations $6,889,885 6,889,885 981,699 5,908,186 Totals $27,849,557 $6,889,885 $34,739,442 1,134,861 $1,525,419 $34,348,884 The adjustment to arrive at the July 1, 1992 restated balance represents previously unrecorded debt related to the City's development fee programs. Due to Chino Basin Municipal Water District: The City assumed responsibility to account for certain sewage facility development fees when CSA 70, Zone Q, was annexed by the predecessor CSA 70, Zone CH District. The City acts as the collecting agent and the amount collected equals the amount due to the Chino Basin Municipal Water District (CBMWD). The fees to finance the construction of certain Chino Basin Municipal Water District plant improvements and modifications are collected under a contractual agreement with CBMWD. $5,453,386 Capital Lease Obligations: The City has entered into various lease agreements for computer equipment which qualify as capital leases. Interest rates on the leases range from 7.50% to 7.95%. Future minimum payments relating to these leases are as follows: Year Ending June 30, Amount 1994 $62,839 1995 3,596 Total minimum lease payments 66,435 Less amount representing interest (2,577) Present value of minimum lease payments $63,858 34 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 The original cost of the equipment, aggregating $228,230 has been capitalized in the Enterprise Fund. Installment Obligation Due Inland Empire Public Facilities Corporation: In May 1986, the County formed the Inland Empire Public Facilities Corporation (IEPFC), a California nonprofit public benefit corporation, to assist the County in financing, refinancing, acquiring, constructing, and improving public facilities. On June 1, 1988, IEPFC sold $20,120,000 of certificates of participation (the "1988 Certificates") to refund the $10,625,000 Water System Acquisition Project Certificates of Participation, finance the acquisition by the County of San Bernardino Public Facilities Corporation ("Facilities Corporation") of a water distribution and irrigation system ("Facilities"), finance various improvements to the District's (now the City) water system and to pay expenses relating to the issuance of the Certificates. On March 15, 1990, the District sold $21,510,000 in Certificates of Participation (the "1990 Refunding Certificates") which were used to refund the $20,120,000 1988 Certificates. The 1990 Refunding Certificates are payable at an adjustable interest rate which will be set semiannually by a remarketing agent based on prevailing financial market conditions, after an initial rate of 6.70% through May 31, 1996. The 1990 Refunding Certificates are secured by an installment sale agreement between the District and the EIPFC. The proceeds of the 1990 Refunding Certificates were used to purchase U.S. Government Securities, which were deposited in an irrevocable trust with an escrow agent to provide for future debt service payments on the refunded 1988 Certificates. As a result, the 1988 Certificates are considered to be defeased, and the related liability has been removed from the accompanying financial statements. The Facilities were originally acquired by the Facilities Corporation from the Pomona Valley Water Company. The Facilities were subsequently sold to the IEPFC. Simultaneously, the IEPFC and the District entered into an installment sale agreement ("Agreement") which provided for the sale of the Facilities to the -" District. The Agreement requires the District, and now the City, to establish rates and collect charges to provide "net revenues" equal to at least 1.10 times the sum of: (i) the aggregate annual payment requirements with respect to the Agreement; (ii) any payments required with respect to parity obligations in such year. 35 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 The installment obligation repayment terms virtually coincide with the terms of the 1990 Refunding Certificates which require principal and interest payments from the City to the IEPFC through June 1, 2018. The installment obligation bears interest through May 31, 1996 at the rate of 6.70%. Thereafter, the rate will be adjusted to the prevailing market rate every six months, payable semi- annually on May 15 and November 15 of each year, 15 days before the Certificates are due. The annual requirements to repay the installment obligation as of June 30, 1993, assuming that the 6.70% interest rate stays in effect for the full term of the installment obligation, are as follows: Year Ending Interest Total Annual June 30, Principal Expenses Payments 1994 $ 320,000 $ 1,344,020 $ 1,664,020 1995 345,000 1,322,580 1,667,580 1996 365,000 1,299,465 1,664,465 1997 395,000 1,275,010 1,670,010 1998 415,000 1,248,545 1,663,545 Thereafter 18,220,000 15,449,530 33,669,530 $20,060,000 ;,21,939,150 $41,999,150 The City has the option of prepaying on or after June 1, 1993 any Certificate installments due on or after June 1, 1994. At redemption, the City will be required to pay a prepayment premium equal to the following amounts expressed as a percentage of the total principal amount prepaid: Dates of Prepayment Payment June 1, 1993 and December 1, 1995 3.0% June 1, 1994 and December 1, 1996 2.5% June 1, 1995 and December 1, 1997 1.5% June 1, 1996 and December 1, 1998 0.5% June 1, 1997 and thereafter 0.0% Installment Obligation Due Water Facilities Authority: The City's participation in the debt of the Water Facilities Authority is 7.52415% share of the Water Facilities Authority's debt. Such debt matures as scheduled below: Maturity Type Interest Price (October 1) Amount Serial 4 to 6.70 100.00 1990 to 2000 $ 7,000,000 36 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Maturity Type Interest Price (October 1) Amount Term 6.75 97.25 2001 15,970,000 Term 5.50 83.00 2015 9,340,000 $32,310,000 The following summarizes the future minimum installment payments due by the City: Year Ending June 30, 1994 $ 191,864 1995 191,864 1996 192,369 1997 192,949 1998 193,564 Thereafter 3,360,101 Total minimum payments 4,322,711 Less amount representing interest (2,016,183) $2,306,528 Advances for Construction: In the Agreement for the acquisition of the Pomona Valley Water Company ("Pomona Valley"), the District, now the City, agreed to assume responsibility for repayment of certain cash advances made to Pomona Valley by various developers and individuals under individual contracts for the construction of main extension pipeline and special facilities. The advances are to be repaid, without interest, based on a percentage of water revenues received from the main extension pipeline payable annually, and within 20 years of the origination of each individual advance with final payment on all advances by the year 2003. $556,926 37 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Development Program Fee Obligations: The City has executed many agreements with outside developers requiring developers to provide funding up front for the costs of backbone infrastructure (major thoroughfares, water and sewer mains, etc.) concurrent with the development of their residential and commercial projects. This "up front" funding is generally in the form of the developer constructing the backbone infrastructure. Future development fees will be used to reimburse the developers for their "up front" funding. A liability has been recorded for the project costs incurred to date, including estimated construction in progress. $5,908,186 10. CONTINGENCIES Litigation: The City is involved in several pending lawsuits of a nature common to many similar jurisdictions. City management estimates that potential claims against the City, not covered by insurance, will not have a material adverse effect on the financial statements of the City. 11. ASSESSMENT DISTRICT AND COMMUNITY FACILITIES DISTRICT BOND ISSUES Excluded from the General Long-Term Debt Account Group are special assessment and special tax bonds related to various special assessment districts and community facilities districts included within the City. The City acts as an agent for the property owners benefitted by the projects financed from the bond proceeds in collecting the assessments and taxes, forwarding the collections to bond holders and initiating foreclosure proceedings, if appropriate. Neither the faith and credit nor the taxing power of the City is pledged to the payment of the bonds and the City is not legally or morally obligated for payment of the bonds. Included in the Agency fund is $24,957,145 of funds due to bondholders relating to these obligations. The debt outstanding at June 30, 1993 consists of the following individual issues: 1988$33,170,000 Assessment District No. 85-1-R, serial bonds due in annual installments of $240,000 to $2,585,000 through September 2, 2021; interest ranging from 6.7% to 8% $29,070,000 38 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 1987 $24,549,858 Assessment District No. 86-1, Series A serial bonds due in annual installments of$60,000 to $1,585,000 through September 2, 2007; interest ranging from 6.5% to 8.35% 5,455,000 1988 $7,422,157 Assessment District No. 86-1, Series B serial bonds due in annual installments of $155,000 to $640,000 through September 2, 2007; interest ranging from 6.40% to 8.38% 4,560,000 1988 $8,707,354 Assessment District No. 87-1, serial bonds due in annual installments of $110,000 to $755,000 through September 2, 2009; interest ranging from 7.10% to 7.70% 5,015,000 1988 $4,990,000 Community Facilities District No. 1 Special Tax bonds, Series "A", due in annual installments of$45,000 to $575,000 through September 1, 2011; interest ranging from 6.60% to 7.90% (defeased during FY 92/93) 4,860,000 1988 $4,180,000 Community Facilities District No. 1, Special Tax Bonds, Series "B", due in annual installments of$65,000 to $415,000 through September 1, 2011; interest ranging from 5.50% to 7.65% (defeased during FY 92/93) 4,115,000 1988 $5,310,000 Community Facilities District No. 2, Special Tax Bonds, Series "A", due in annual installments of$55,000 to $615,000 through September 1, 2011; interest ranging from 5.50% to 7.65% 5,255,000 1988 $2,795,000 Community Facilities District No. 4, Special Tax Bonds, Series "A", due in annual installments of$25,000 to $320,000 through September 1, 2011; interest ranging from 6.60% to 7.90% (defeased during FY 92/93) 2,720,000 1988 $2,030,000 Community Facilities District No. 5, Special Tax Bonds, Series "A", due in annual installments of$20,000 to $235,000 through September 1, 2011, interest ranging from 6.20% to 8.00% (defeased during FY 92/93) 1,975,000 39 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 1988 $2,880,000 Community Facilities District No. 8, Special Tax Bonds, Series "A", due in annual installments of$25,000 to $335,000 through September 1, 2011, interest ranging from 6.20% to 8.00% (defeased during FY 92/93) 2,815,000 1991 $5,435,000 Community Facilities District No. 9, Special Tax Bonds, Series "A", due in annual installments of$15,000 to $615,000 through September 1, 2015; interest ranging from 6.00% to 8.38% 5,435,000 1991 $17,065,000 Community Facilities District No. 9, Special Tax Bonds, Series "B", due in one annual installment of $17,065,000 on September 1, 1998; interest rate at 8.00% 17,065,000 1993 $9,460,000 Community Facilities District No. 1, Special Tax Refunding Bonds due in annual installments of$10,000 to $975,000 through September 1, 2011; interest ranging from 5.3% to 6.25% 9,460,000 1993 $2,880,000 Community Facilities District No. 4, Special Tax Refunding Bonds due in annual installments of $5,000 to $305,000 through September 1, 2011; interest ranging from 3.5% to 5.9% 2,880,000 1993 $2,090,000 Community Facilities District No. 5, Special Tax Refunding Bonds due in annual installments of$50,000 to $230,000 through September 1, 2011; interest ranging from 5.20% to 6.25% 2,090,000 1993 $3,095,000 Community Facilities District No. 8, Special Tax Refunding Bonds due in annual installments of$10,000 to $320,000 through September 1, 2011; interest ranging from 3.5% to 5.9% 2.980,000 $105,750,000 12. JOINT VENTURES Southern California Joint Powers Insurance Authority (SCJPIA): SCJPIA is a consortium of 75 cities and other public agencies in Southern California established under the provisions of California Government Code Section 40 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 6500, et seq. SCJPIA provides risk coverage for its members through the pooling of risks and purchased insurance. This coverage extends to workers compensation, general and vehicle liability, and general and vehicle property. SCJPIA is governed by a Board consisting of one board member appointed by each member agency. The Board elects officers which meet monthly to supervise and conduct SCJPIA affairs. SCJPIA maintains a staff headed by a Manager to implement the policies of the Board. Available audited financial information for the operations of the SCJPIA as of June 30, 1993 is presented below. Total Assets $76,086,530 Liabilities & Equity: Total Liabilities $58,310,507 Retained Earnings 17,776,023 Total Liabilities & Equity $76,086.530 Total Revenues $22,588,167 Total Expenses 11,839,714 Net Income $10,748,453 In the event of termination of the joint venture agreement and after all claims have been settled, any excess or deficit will be divided among the agencies in accordance with an approved formula. Water Facilities Authority: On February 19, 1980, the Water Facilities Authority (Authority) was created under a joint exercise of powers agreement between the CSA 70 Zone CH (now part of the City of Chino Hills) and other local entities. It was formed for the acquisition and construction of facilities to supply water to the inhabitants within the boundaries of its members. The governing Board of Directors consists of one member appointed from each participating agency and has approval of all budget and finance activities. The City's investment in the Authority has been recorded on the equity method of accounting and is shown as an investment in joint venture in the Enterprise Fund. On October 1, 1986, the Authority issued $33,715,000 Refunding Certificates of Participation, 1986 Series A (Agua de Lejos Project), with fixed interest rates varying between 4% and 6.5%. Final maturity is due in 2015. The outstanding balance at June 30, 1993 is $30,655,000. 41 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Each participant in the joint venture has pledged gross revenues from its respective Enterprise Fund and has agreed to restrictive covenants that establish rates and charges for each respective water enterprise fund at levels sufficient to maintain net revenues equal to at least 1.25 times the aggregate amount of each respective party's installment payments to the Authority as well as any parity debt which shall become due and payable within the succeeding twelve months. The City is liable to repay 7.52415% of the Authority's debt and therefore has recorded this portion, $2,306,528, in the financial statements. The components of the City's investment in the Authority at June 30, 1993 are summarized as follows: City contributed capital $2,925,839 Portion of Authority Debt assumed, excluding related reserve fund of $205,078 2,102,051 Cumulative equity in earnings of the Authority 394,822 Total Investment in the Authority $5,422,712 By agreement, allocations of planned capacity and entitlement are as follows: Participant Percentage City of Chino Hills 15.7% Monte Vista Water District 24.0 City of Chino 5.9 City of Ontario 31.4 City of Upland 23.0 Total 100.0% Audited financial information of the Authority for the fiscal year ended June 30, 1993 is summarized as follows: Authority City Share Total assets $46,8075951 $10,453,854 Total liabilities $31,936,507 $7,132,540 Total fund equity $14,871,444 $3,321,314 42 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Authority City Share Operating revenues $7,001,678 $1,563,720 Operating expenses (8,689,172) (1,940,596) Non-operating revenue (net) 1,031,513 230,373 Net Loss (655,981) (146,503) Retained earnings, beginning of year 2,423,826 541.325 Retained earnings, end of year $1,767,845 $ 394,822 Property, plant and equipment (net) $35,491,073 $7,926,399 Net working capital $3,784,650 $845,245 Capital contributions $13,100,628 $2,925,839 The participants and their audited financial contributions through June 30, 1993 were as follows: 1993 Amount Percent City of Chino Hills $ 2,925,839 22.33% Monte Vista Water District 2,222,652 16.97 City of Chino 1,819,363 13.89 City of Ontario 3,729,582 28.47 City of Upland 2,403,192 18.34 Total $131100.628 100.00% 13. LEASE PAYMENTS RECEIVABLE Leases include certain water improvements, facilities, capacity rights and real and related personal property to the City of Chino and the Monte Vista Water District. The lease provides that, upon satisfaction of the terms of the agreement, legal title to the facilities will transfer to the lessees. The following is a schedule of minimum lease payments receivable by years as of June 30, 1993: Year Ending June 30, 1994 $ 430,144 43 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Year Ending June 30, 1995 431,187 1996 430,577 1997 430,140 1998 429,675 Thereafter 2,153,743 Minimum lease payments 4,305,466 Less unearned interest (1,563,825) Lease receivable $2,741,641 14. INSTALLMENT RECEIVABLE In February 1992, City Council approved the sale of land owned by the Enterprise Fund to the General Fund for the construction of the Civic Center. Payment will be made as funds become available. 15. CONTRIBUTED CAPITAL Contributed capital is the portion of equity derived from pipeline constructed and serviced by developers and donated to the City. Such equity also includes connection fees received from developers and customers to join new or extend existing water systems, as well as proceeds from special assessment bonds issued to finance utility plant in service. The following is a summary of the change in contributed capital: Original Prior Restated Balance at Period Balance at Balance at June 30, 1992 Adjustments July 1, 1992 Additions Deletions June 30, 1993 $25,084,263 $9,642,311 $34,726,574 $1,276,737 $(69,379) $35,933,93 The adjustment to arrive at the July 1, 1992 restated balance represents previously unrecorded capital contributed in prior years mainly related to the City's development fee programs (see Note 9). 16. RESIDUAL EQUITY TRANSFERS Residual Residual Equity Equity Transfer In Transfer Out General Fund $870,108 $ - 44 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Residual Residual Equity Equity Transfer In Transfer Out Special Revenue Funds: Lighting and Landscape District #1 $4,832,358 Lighting and Landscape District #2 217,037 CSA $ 501,845 CHMO Administration 441,092 Development Fee 123,272 Total Special Revenue Funds $5,049,395 $1,066,209 Capital Projects Funds: Lighting and Landscape District #1 $4,832,358 Lighting and Landscape District #2 217,037 Rolling Ridge CFD #1 189,619 The Oaks CFD #4 10,599 Soquel Canyon Ricon and Woodview CFD #5 77,902 Butterfield CFD #8 65 Ricon Village CFD #9 $77,879 Total Capital Projects Fund $77,879 $5,327,580 Enterprise Fund Contributed Capital $123,272 $ - Agency Funds: Rolling Ridge CFD #1 $189,619 * The Oaks CFD #4 10,600 * Canyon Ricon and Woodview CFD #5 25 * Butterfield CFD #8 62 * 1915 Act Bonds 72,829 * Total Agency Funds $273,135 $ - * Due to the nature of the fund, these are shown as additions rather than as equity transfers. 17. PRIOR PERIOD ADJUSTMENTS Beginning fund balances and retained earnings have been restated as follows: 45 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Balances Restated as Previously Fund Reported, Sales Tax Interest Operating Balances, June 30, 1992 Revenue Revenue Transfers July 1, 1992 Governmental Fund Types: General Fund $ 369,755 $ 36,900 $ (7,448) $ 399,207 Special Revenue Funds: Lighting and Landscape District #1 6,351,132 (37,326) 6,313,806 Lighting and Landscape District #2 185,557 (12_64) 184,293 CSA 490,333 (102) 490,231 Chino Administration 439,457 439,457 Development Fee 10,196,150 (57,541) $(1,606,000) 8,532,609 FBA 1,537,754 (11,174) 1,526,580 Gas Tax 460,412 (2,939) 457,473 Air Quality 8,653 (48) 8,605 Measure I 126,441 (620) 125,821 Total Special Revenue Funds 19,795,889 (111,014) (1,606,000) 18,078,875 Capital Projects Funds: Special Construction 488,726 (3,722) 485,004 Park Development 75,627 (522) 75,105 Pomona Construction 40,084 (17,579) 2,400,000 2,422,505 Assessment District #85-1 264,934 (1,910) 263,024 Assessment District #86-1 1,379,065 (10,227) 1,368,838 Assessment District #87-1 344,428 (2,700) 341,728 Regional CFD 1,058,162 (11,023) (794,000) 253,139 CFD #1 190,008 (39) 189,969 Cell #2 3,431,567 (29,687) 3,401,880 CFD #9 18,124,695 (137,628) 17,987,067 All Other Capital Projects Funds 5,508,405 5508,405 30,905,701 (215,037) 1,606,000 32,296,664 All Governmental Fund Type Fund Balances $51,071,345 36 900 $(333.499) $ - $50,774,746 46 CITY OF CHINO HILLS Notes to Financial Statements (Continued) June 30, 1993 Enterprise Fund: Retained Earnings as Previously Retained Reported, Interest Development Capitalized Earnings June 30, 1992 Revenue Fee Revenue Interest July 1, 1992 $6.043.649 (50,602) tan $282,469 $6,295,418 Sales Tax Revenue: This adjustment represents sales tax revenue which was not previously recorded. Interest Revenue: This adjustment represents a reduction of interest earnings which had been received and recorded as revenue in error. Operating Transfers: This adjustment represents an exchange of moneys which was previously recorded as an interfund payable and receivable. Development Fee This adjustment represents previously unrecorded Revenue: development fee revenues. Capitalized Interest: This adjustment represents capitalized construction period interest which was previously recorded as interest expense. 18. FUND BALANCE RESERVES AND DESIGNATIONS Fund balance reserves and designations are as follows: Special Debt Capital General Revenue Service Projects Fund Funds Fund Funds Reserved: Encumbrances $375,460 $2,637,253 $10,516,378 Long-term receivable 645,238 Debt service $253,967 Total Reserved $375,460 $3,282,491 $253.967 $10.516,378 Designated: Structure replacements $ - $1,216,615 $ - $ - 47 CITY OF CHINO HILLS Combining Balance Sheet All Special Revenue Funds June 30, 1993 CHMO Lighting and Landscape Adminis— Assets District 1 District 2 CSA tration Cash and investments $ 13,100,324 $ 441,668 $ 14,647 Interest receivable 187,267 6,391 270 Taxes receivable Special assessment receivable—current 179,380 6,134 Deferred special assessment receivable Advances to other funds 50,000 Total Assets $ 13,516,971 $ 454,193 $ 14,917 $ — Liabilities and Fund Balances Liabilities: Accounts payable $ 394,048 $ 33,509 $ 100 Due to other funds 88,291 7,388 9 Salaries and benefits payable 35,190 540 Total Liabilities 517,529 41,437 109 Fund Balances: Reserved for long—term deferred special assessments receivable Reserved for encumbrances 2,132,473 69,488 Designated for structure replacement 1,054,867 161,748 Unreserved — undesignated 9,812.102 181,520 14,808 Total Fund Balances 12,999.442 412,756 14,808 Total Liabilities and Fund Balances $ 13,516,971 $ 454,193 $ 14.917 $ — 48 Development Air Federal Fee FBA Gas Tax Quality Grants Measure I Totals $ 5,586,718 $ 701,007 $ 1,086,852 $ 69,405 $ 27,108 $ 511,602 $ 21,539,331 141,829 20,200 14,696 739 314 6,418 378,124 40,326 40,326 185,514 645,238 645,238 50,000 $ 6,373,785 $ 721,207 $ 1,101,548 $70,144 $ 27,422 $ 558,346 $ 22,838,533 $ 1,005,733 $ 35,053 $ 14,993 $ 48 $ 619 $ 1,484,103 4,215 452 588 35 $ 16 290 101,284 1,073 8,758 45,561 1,011,021 35,505 24,339 83 16 909 1,630,948 645,238 645,238 327,224 11,181 96,887 2,637,253 1,216,615 4,390,302 674,521 980,322 70,061 27,406 557,437 16,708,479 5,362,764 685,702 1,077,209 70,061 27,406 557,437 21,207,585 $ 6,373,785 $ 721,207 $ 1,101,548 $ 70,144 $ 27,422 $ 558,346 $ 22,838,533 49 CITY OF CHINO HILLS Combining Statement of Revenues,Expenditures and Changes in Fund Balances All Special Revenue Funds For the Year Ended June 30, 1993 CHMO Lighting and Landscape Adminis— District 1 District 2 CSA tration Revenues: Special assessment taxes $ 6,067,181 $ 385,769 Use of money and property 534,620 15,615 $ 26,430 Intergovernmental Developer fees Other 58,314 $ 1,635 Total Revenues 6,660,115 401,384 26,430 1,635 Expenditures: Current: General government Public safety Public works 4,106,927 272,563 8 Capital outlay 450,524 8,579 Debt service: Principal retirement Interest and fiscal charges Total Expenditures 4,557,451 281,142 8 Excess(Deficiency) of Revenues Over Expenditures 2,102,664 120,242 26,422 1,635 Other Financing Sources (Uses): Proceeds of long—term debt Operating transfers in 3,685,511 39,407 Operating transfers out (3,934,897) (148,223) Total Other Financing Sources(Uses) (249,386) (108,816) Excess(Deficiency) of Revenues and Other Financing Sources Over Expenditures and Other Financing Uses 1,853,278 11,426 26,422 1,635 Fund Balances,Beginning of Year, as Restated 6,313,806 184,293 490,231 439,457 Residual equity transfer from (to) other funds 4,832,358 _ 217,037 (501,845) (441,092) Fund Balances,End of Year $ 12,999,442 $ 412,756 $ 14,808 $ — 50 Development Air Federal Fee FBA Gas Tax Quality Grants Measure I Totals $ 6,452,950 $ 517,666 $ 69,977 $ 46,635 $ 1,488 $ 609 $ 17,272 1,230,312 830,410 60,037 26,826 415,130 1,332,403 6,308,361 942,144 7,250,505 1,775 61,724 6,827,802 1,012,121 877,045 61,525 27,435 432,402 16,327,894 29 29 257,309 257,309 3,521,351 32,041 69 786 7,933,745 1,948,045 418,605 2,825,753 5,335,531 584,149 5,919,680 283,808 283,808 11,088,735 1,034,795 257,309 69 29 786 17,220,324 (4,260,933) (22,674) 619,736 61,456 27,406 431,616 (892,430) 2,518,317 74,000 2,592,317 622,404 4,347,322 (1,926,361) (892,204) (6,901,685) 1,214,360 (818,204) 37,954 (3,046,573) (840,878) 619,736 61,456 27,406 431,616 (854,476) 8,532,609 1,526,580 457,473 8,605 125,821 18,078,875 (123,272) 3,983,186 $ 5,362,764 $ 685,702 $ 1,077,209 $ 70,061 $ 27,406 $ 557,437 $ 21,207,585 51 CITY OF CHINO HILLS Combining Balance Sheet All Capital Projects Funds June 30, 1993 Lighting and Landscape Special ' Park Assets District 1 District 2 Construction Development Cash and investments $ 663,706 $ 452,290 Cash and investments with fiscal agent Interest receivable 4,253 3,301 Total Assets $ — $ — $ 667,959 $ 455,591 Liabilities and Fund Balances Liabilities: Accounts payable $ 221,403 $ 679 Due to other funds 27 139 Salaries and benefits payable Total Liabilities 221,430 818 Fund Balances: Reserved for encumbrances 249,656 278,558 Unreserved — undesignated 196,873 176,215 Total Fund Balances 446,529 454,773 Total Liabilities and Fund Balances $ — $ — $ 667,959 $ 455,591 52 Capital Parkway Improvement Pomona Special Assessment Districts Phasing Corporation Construction AD#85-1 AD #86-1 AD #87-1 $ 633,608 $ 2,546,286 $ 271,190 $ 2,189,790 $ 378,329 $ 218 6,528 47,023 5,053 28,288 7,081 $ 640,136 $ 218 $ 2,593,309 $ 276,243 $ 2,218,078 $ 385,410 $ 500,000 $ 17,579 $ 7,238 $ 2,146,897 $ 2,778 326 1,472 157 903 219 500,326 19,051 7,395 2,147,800 2,997 40,895 139,810 $ 218 2,574,258 268,848 29,383 382,413 139,810 218 2,574,258 268,848 70,278 382,413 $ 640,136 $ 218 $ 2,593,309 $ 276,243 $ 2,218,078 $ 385,410 (Continued) 53 CITY OF CHINO HILLS Combining Balance Sheet All Capital Projects Funds (Continued) June 30, 1993 Community Facilities #1 #2 #4 Rolling Los The Assets Regional Ridge Ranchos Oaks Cash and investments $ 2,228,750 $4,742 $ 3,528,903 $ 49,692 Cash and investments with fiscal agent Interest receivable 37,037 93 70,558 372 Total Assets $ 2,265,787 $4,835 $ 3,599,461 $ 50,064 Liabilities and Fund Balances Liabilities: Accounts payable $ 41,657 $ 38 $ 29,688 $27,367 Due to other funds 1,301 3 2,043 18 Salaries and benefits payable Total Liabilities 42,958 41 31,731 27,385 Fund Balances: Reserved for encumbrances 461,387 12,947 Unreserved — undesignated 1,761,442 4,794 3,567,730 9,732 Total Fund Balances 2,222,829 4,794 3,567,730 22,679 Total Liabilities and Fund Balances $ 2,265,787 $4,835 $ 3,599,461 $ 50,064 54 Districts #5 Soquel Canyon #9 Ricon and #8 Ricon Woodview Butterfield Village Totals $ 16,409,850 $ 29,357,136 218 331,949 541,536 $ — $ — $ 16,741,799 $ 29,898,890 $ 1,800,279 $ 4,795,603 9,716 16,324 2,448 2,448 1,812,443 4,814,375 9,472,935 10,516,378 5,456,421 14,568,137 14,929,356 25,084,515 $ — $ — $ 16,741,799 $ 29,898,890 55 CITY OF CHINO HILLS Combining Statement of Revenues,Expenditures and Changes in Fund Balances All Capital Projects Funds For the Year Ended June 30, 1993 Lighting and Landscape Special Park District 1 District 2 Construction Development Revenues: Use of money and property $ 138,339 $ 6,319 $ 22,322 $ 9,339 Contributions from developers Other 7,853 1,520 Total Revenues 138,339 6,319 30,175 10,859 Expenditures: Current: Public works 578,650 27,413 Capital outlay 7,778 Debt service: Principal retirement Interest and fiscal charges Total Expenditures 578,650 35,191 Excess(Deficiency) of Revenues Over Expenditures 138,339 6,319 (548,475) (24,332) Other Financing Sources (Uses): Proceeds of long—term debt Operating transfers in 510,000 404,000 Operating transfers out Total Other Financing Sources(Uses) 510,000 404,000 Excess (Deficiency) of Revenues and Other Financing Sources Over Expenditures and Other Uses 138,339 6,319 (38,475) 379,668 Fund Balances,Beginning of Year 4,694,019 210,718 485,004 75,105 Residual equity transfer from (to) other funds (4,832,358) (217,037) Fund Balances,End of Year $ — $ — $ 446,529 $ 454,773 56 Capital Parkway Improvement Pomona Special Assessment Districts Phasing Corporation Construction AD #85-1 AD #86-1 AD #87-1 $ 29,604 $ 2,504 $ 158,366 $ 17,252 $ 88,097 $ 24,182 1,039,889 27,338 29,604 2,504 158,366 17,252 1,127,986 51,520 1,390 6,613 11,428 2,426,546 10,835 689,161 76,074 690,551 76,074 6,613 11,428 2,426,546 10,835 (660,947) (73,570) 151,753 5,824 (1,298,560) 40,685 2,198,828 324,762 (2,125,040) 324,762 73,788 (336,185) 218 151,753 5,824 (1,298,560) 40,685 475,995 2,422,505 263,024 1,368,838 341,728 $ 139,810 $ 218 $ 2,574,258 $ 268,848 $ 70,278 $ 382,413 (Continued) 57 CITY OF CHINO HILLS Combining Statement of Revenues,Expenditures and Changes in Fund Balances All Capital Projects Funds (Continued) For the Year Ended June 30, 1993 Community Facilities #1 #2 #4 Rolling Los The Regional Ridge Ranchos Oaks Revenues: Use of money and property $ 112,589 $ 8,283 $ 230,392 $ 1,432 Contributions from developers 1,063,640 378,353 482,713 247,683 Other Total Revenues 1,176,229 386,636 713,105 249,115 Expenditures: Current: Public works 160,874 3,839 62,216 15,767 Capital outlay 1,170,705 201,835 223,989 Debt service: Principal retirement 378,353 283,204 Interest and fiscal charges Total Expenditures 1,331,579 382,192 547,255 239,756 Excess (Deficiency) of Revenues Over Expenditures (155,350) 4,444 165,850 9,359 Other Financing Sources (Uses): Proceeds of long-term debt Operating transfers in 2,125,040 Operating transfers out Total Other Financing Sources(Uses) 2,125,040 Excess(Deficiency) of Revenues and Other Financing Sources Over Expenditures and Other Uses 1,969,690 4,444 165,850 9,359 Fund Balances,Beginning of Year 253,139 189,969 3,401,880 23,919 Residual equity transfer from (to) other funds (189,619) (10,599) Fund Balances,End of Year $ 2,222,829 $ 4,794 $ 3,567,730 $ 22,679 58 Districts #5 Soquel Canyon #9 Ricon and #8 Ricon Woodview Butterfield Village Totals $ 4,068 $ 531 $ 1,141,607 $ 1,995,226 3,212,278 36,711 4,068 531 1,141,607 5,244,215 18,361 12,025 1,058,445 4,394,402 3,218,752 4,823,059 1,350,718 76,074 18,361 12,025 4,277,197 10,644,253 (14,293) (11,494) (3,135,590) (5,400,038) 2,198,828 3,363,802 (2,125,040) 3,437,590 (14,293) (11,494) (3,135,590) (1,962,448) 92,195 11,559 17,987,067 32,296,664 (77,902) (65) 77,879 (5,249,701) $ — $ — $ 14,929,356 $ 25,084,515 59 CITY OF CHINO HILLS Combining Balance Sheet All Agency Funds June 30, 1993 Chino Unified School Special Assessment Districts Assets District AD 85-1 AD 86-1 AD 87-1 Cash and investments $ 217,832 $ 7,128,935 $ 6,310,875 $ 1,212,629 Cash and investments with fiscal agents Interest receivable 2,043 127,171 125,849 21,760 Special assessment receivable—current 133,850 67,036 Total Assets $ 219,875 $ 7,256,106 $ 6,570,574 $ 1,301,425 Liabilities Accounts payable $ 212,996 $ 49,077 $ 601,872 $ 8,633 Due to other funds 73 4,016 3,971 678 Deferred compensation payable Funds held for others 6,806 7,203,013 5,964,731 1,292,114 Total Liabilities $ 219,875 $ 7,256,106 $ 6,570,574 $ 1,301,425 60 Community Facilities Districts #5 #1 #2 Canyon #6 Rolling Los #4 Ricon and Carbon #8 Regional Ridge Ranchos The Oaks Woodview Canyon Butterfield $ 28,582 $ 1,362,510 $ 996,068 $ 1,249,424 $ 677,200 $ 13,972 $ 1,153,408 1,092,868 320,749 233,058 335,828 818 32,276 17,742 32,737 16,545 306 21,628 13,886 8,949 9,885 1,255 179 7,144 $29,400 $ 2,501,540 $ 1,022,759 $ 1,612,795 $ 928,058 $ 14,457 $ 1,518,008 $ 659 $ 15,497 $ 8,290 $ 14,292 $ 7,568 $ 152 $ 7,730 8 1,050 547 922 456 7 737 28,733 2,484,993 1,013,922 1,597,581 920,034 14,298 1,509,541 $ 29,400 $ 2,501,540 $ 1,022,759 $ 1,612,795 $ 928,058 $ 14,457 $ 1,518,008 (Continued) 61 CITY OF CHINO HILLS Combining Balance Sheet All Agency Funds (Continued) June 30, 1993 #9 Ricon Deferred 1915 Act Assets Village Compensation Bonds Totals Cash and investments $ 2,823,660 $ 72,609 $ 23,247,704 Cash and investments with fiscal agents $ 4,282 1,986,785 Interest receivable 51,269 839 450,983 Special assessment receivable—current 242,184 Total Assets $ 2,874,929 $ 4,282 $ 73,448 $ 25,927,656 Liabilities Accounts payable $ 25,479 952,245 Due to other funds 1,477 $ 42 13,984 Deferred compensation payable $ 4,282 4,282 Funds held for others 2,847,973 73,406 24,957,145 Total Liabilities $ 2,874,929 $ 4,282 $ 73,448 $ 25,927,656 62