HomeMy WebLinkAboutItem No. 05 - Receive and File the Comprehensive Annual Financial Report
Page 1
Staff Report
City of San Bernardino
Request for Council Action
Date: February 19, 2020
To: Honorable Mayor and City Council Members
From: Teri Ledoux, City Manager
By: Paul Espinoza, Finance Director
Subject: Receive and File the Comprehensive Annual Financial Report
for Fiscal Year 2018/19
Recommendation
It is recommended that the Mayor and City Council of the City of San Bernardino,
California, receive and file the Fiscal Year 2018/19 Comprehensive Annual Financial
Report (CAFR).
Background
By March 31st of each year, pursuant to California law, the City is required to complete
an annual audit of its financial records by an independent audit firm for the previous
year ended June 30th. The City has contracted with the Pun Group, L LC through FY
2018/19 to perform this function. They have completed this task for FY 2018/19. The
final Comprehensive Annual Financial Report is attached to this report and was filed in
a timely manner with the State Controller’s Office.
The 2018/19 CAFR contains numerous comprehensive financial reports pertaining to all
aspects of the City’s finances and for all City funds including: the General, Special
Revenue, Housing, Capital Project, Internal Service, and Enterprise (Water, Sewer and
Sewer Collection) funds as well as Fiduciary and Agency funds. Financial information is
conveyed both by major fund type and in a comprehensive aggregated manner; thus,
the information is somewhat complex to interpret. Because of this, specific detailed
information regarding the General Fund Year-End results for FY 2018/19 was presented
separately at the December 4, 2019 Mayor and City Council meeting.
Discussed below are the highlights of the CAFR and results of the audit. The notes to
the Basic Financial Statements (pages 55-130) also provide detailed information
regarding accounting methods and year-over-year changes.
Discussion
The CAFR contains three sections:
1. Introductory Section
a. The Letter of Transmittal
b. Mayor and City Council
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c. Principal Officials
d. Organizational Chart
2. Financial Section
a. The Independent Auditor’s Report
b. Basic Financial Statements
c. Required Supplementary Information
d. Supplementary Information
3. Statistical Section
1. Introductory Section
a. The Letter of Transmittal is to introduce the CAFR and not intended to
duplicate information in the Management Discussion and Analysis but to
elaborate. The Letter of Transmittal includes a brief profile of City
Government and the Economic Condition.
b. Mayor and City Council
c. Principal Officials
d. Organizational Chart
2. Financial Section
The Financial Section comprises the majority of the report and discussion.
a. Independent Auditor’s Report
The auditor’s opinion for a financial statement is most typically an “Unmodified”
opinion. That implies two things - 1) the auditors were able to perform all the
required tests of the accounts and, 2) the financial statements present fairly, in all
material respects, the financial position of the City’s opinion units. From
FY2012/13 - FY2017/18 the City of San Bernardino received “Qualified” or
“Modified” opinions. That means that for some portion of the accounts, the
auditors were not able to perform the required tests - it does not mean that the
results of the tests performed were unsatisfactory. For FY2018/19 there were no
qualified opinions.
The City was able to correct the four areas where modified opinions were
rendered: Governmental Activities, Major Federal & State Grants Special
Revenue Fund, Major Low and Moderate Income Housing Special Revenue
Fund, and Aggregate Remaining Fund Information. The reasoning for this
opinion was the fact that the City had not adopted a methodology for reviewing
the collectability of notes receivable, primarily related to the former
Redevelopment Agency (RDA) and Housing Division. In FY2018/19 Staff was
able to successfully implement a methodology in reviewing the collectability of
notes receivable and received an unmodified opinion. This represents a
significant step forward in the City’s financial reporting.
b. Basic Financial Statements
Within the Basic Financial Statement, there are three sections: Government -
wide Financial Statements, Fund Financial Statements and Notes to the Basic
Financial Statements. The information presented in the government-wide
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financial statements is very different than the information presented in the fund
financial statements and they each serve different purposes.
Government-wide financial statements are comprehensive in scope, meaning all
assets (including capital assets and infrastructure) and all liabilities (including
outstanding long-term debt and CalPERS unfunded liabilities) are presented.
Additionally, the Government-wide statements include the assets and liabilities of
the San Bernardino Municipal Water Department. The government-wide
statements have a long-term focus (recognizing transactions and events as soon
as they occur, even if related cash flows will not take place well into the future).
The purpose of the government-wide statements is to assess whether the City is
meeting its operating objectives effectively and will be able to continue to do so
for the foreseeable future.
The government-wide financial statements analyze the City’s “Net position.” Net
position is the difference between the City’s assets and liabilities. Over time,
increases or decreases in net position may serve as a useful indicator of whether
the City’s financial position is improving or deteriorating. Below is a summary of
the changes in net position for Governmental and Business-type Activities:
“Business-type Activities” are related to water, sewer, sewer collection, and
integrated waste activities. All other activities are in the “Governmental Activities”
category. FY 2018/19 saw a decrease in Net Posi tion of $21.67 million for the
City's Governmental Activities, partially offset by an increase in Net Position of
$12.73 million in the City's Business-type Activities. In total, the City's Net
Position decreased by $8.94 million in FY 2018/19, due princip ally to increased
costs for public safety and streets in the City's Governmental Activities and a
one-time loss of $8.38 million in the City's Business -type funds related to the
liquidation of the East Trunk Line fiduciary fund from the Sewer Fund.
Unlike the previous fiscal year where we saw a $48.5 million increase in the net
pension liability, we now see a $7.7 million decrease to the City’s net pension
liability. The decrease is primarily due to investment income generated from the
pension investments. In FY 2018/19, the City’s required payment toward the
unfunded accrued liability (UAL) was $28.2 million.
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Fund financial statements are narrower in scope. A fund is a grouping of related
accounts and is used to maintain control over resources that have been
segregated for specific activities or objectives. All of the City’s funds are
aggregated into three categories: governmental, proprietary and fiduciary. In
the case of governmental funds (including the General Fund) the fund financial
statements have a near-term focus (recognizing transactions and events only to
the extent that they affect near-term cash flows). Total Governmental Funds
balance increased by $747 thousand over the previous year.
Below is a summary of changes in fund balance for governmental funds:
Fund balance is classified into a number of categories:
Non-Spendable- non liquid assets, for example, as property held for resale.
Restricted - restricted by external limitations such as gas tax revenue or bond
proceeds.
Committed - self-imposed limitations by the City; requires formal action to
change, for example reserves for capital improvements.
Unassigned - amount available in excess of all other classifications.
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At 6/30/2019, the General Fund had an unassigned fund balance of $31,543,452.
General Fund cash and receivable balances, which are not restricted or
committed for a specific purpose, decreased by $7.5 million. As was discussed
during the FY 2018/19 Mid-Year Financial Review presented to the Mayor and
City Council on April 3, 2019, the main contributing factor to the decrease in the
General Fund unassigned balance was the transfer of over $7 million to
remediate the deficit in the Special Gas Tax Fund and meet the Measure I
Maintenance of Effort (MOE) Requirement that had accumulated to over $ 7.9
million as of fiscal year end 2018.
Reconciliation of Change in Net Position to Change in Fund Balance
As discussed earlier, the government-wide statements show a decrease in
governmental activities of $21.67 million, while the fund statements indicate an
increase in governmental fund balances of $747 thousand. Page 34 of the
Annual Financial Statements provides reconciliation between these two reports
to facilitate the comparison between governmental funds and governmental
activities.
The Notes to the Financial Statements provide over 75 pages of information on
subjects including: accounting policies, long term debt and liabilities,
investments, capital assets, pension obligations, and other items essential to
obtaining a full understanding of the data provided in the financial statements.
These notes are listed in the table of contents on page 55 of the CAFR .
c. Required Supplementary Information (RSI)
The following information is contained in the RSI section of the Annual Financial
Report: budgetary information for the General Fund and major special revenue
funds, changes in net pension liability, changes in net OPEB liability, and
schedules of pension contributions and OPEB contributions as listed in the table
of contents.
d. Supplementary Information:
The Supplementary Information section contains financial reports regarding the
Non-Major Governmental Funds, Internal Service Funds and the Fiduciary
Funds, as well as budget to actual comparisons fo r all other governmental funds
with a legally adopted budget for FY 2018/19.
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2020-25 Key Strategic Targets and Goals
Providing the Mayor and City Council with the Comprehensive Annual Financial Report
for FY 2018/19 is aligns with Key Target No. 1: Financial Stability, by providing fiscal
information included herein to aide the Mayor and City Council as they make decisions
about the allocation of City resources.
Fiscal Impact
There is no fiscal impact from this action. The report is intended to provide i nformation
to assist the Mayor and City Council as they make financial decisions and assess the
financial condition of the City.
Conclusion
It is recommended that the Mayor and City Council of the City of San Bernardino,
California, receive and file receive and file the Fiscal Year 2018/19 Comprehensive
Annual Financial Report (CAFR).
Attachments
Attachment 1 2019 Comprehensive Annual Financial Report
Attachment 2 2018/19 CAFR PowerPoint
Ward: 1, 2, 3, 4, 5, 6 & 7
Synopsis of Previous Council Actions:
FY 2018/19 Year-End Financial Update December 4, 2019
City of San Bernardino
San Bernardino, California
Comprehensive Annual Financial Report
For the Year Ended June 30, 2019
City of San Bernardino
Comprehensive Annual Financial Report
For the Year Ended June 30, 2019
Prepared by the San Bernardino Finance Department
San Bernardino, California
City of San Bernardino
Comprehensive Annual Financial Report
For the Year Ended June 30, 2019
Table of Contents
Page
INTRODUCTORY SECTION (Unaudited)
Letter of Transmittal ..................................................................................................................................................... i
Mayor and City Council ............................................................................................................................................... v
Principal Officials ......................................................................................................................................................... vi
Organizational Chart .................................................................................................................................................... vii
FINANCIAL SECTION
Independent Auditors’ Report on Financial Statements ........................................................................................... 1
Management’s Discussion and Analysis
(Required Supplementary Information) (Unaudited) ................................................................................................ 5
Basic Financial Statements:
Government-Wide Financial Statements:
Statement of Net Position ................................................................................................................................. 22
Statement of Activities and Changes in Net Position ....................................................................................... 24
Fund Financial Statements:
Governmental Fund Financial Statements:
Balance Sheet ............................................................................................................................................. 31
Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position ............................................................................... 32
Statement of Revenues, Expenditures, and Changes in Fund Balances .................................................... 33
Reconciliation of the Governmental Statement of Revenues,
Expenditures, and Changes in Fund Balances to the Government-Wide
Statement of Activities and Changes in Net Position ............................................................................. 34
Proprietary Fund Financial Statements:
Statement of Net Position .......................................................................................................................... 36
Statement of Revenues, Expenses, and Changes in Net Position .............................................................. 40
Statement of Cash Flows ........................................................................................................................... 42
Fiduciary Fund Financial Statements:
Statement of Fiduciary Net Position .......................................................................................................... 49
Statement of Changes in Fiduciary Net Position ....................................................................................... 50
Notes to the Basic Financial Statements ............................................................................................................. 55
City of San Bernardino
Comprehensive Annual Financial Report
For the Year Ended June 30, 2019
Table of Contents (Continued)
Page
FINANCIAL SECTION (Continued):
Required Supplementary Information (Unaudited):
Budgetary Information ........................................................................................................................................... 133
Budgetary Comparison Schedules:
General Fund ................................................................................................................................................... 134
Federal and State Grants Special Revenue Fund ............................................................................................. 135
Schedules of Changes in the Net Pension Liability and Related Ratios ................................................................ 136
Schedule of the Successor Agency’s
Proportionate Share of the Net Pension Liability and Related Ratios ................................................... 138
Schedule of Contributions - Pension ...................................................................................................................... 139
Schedule of Changes in Net OPEB Liability and Related Ratios .......................................................................... 142
Schedule of Contributions - OPEB ........................................................................................................................ 143
Supplementary Information:
Non-Major Governmental Funds:
Combining Balance Sheet ............................................................................................................................... 150
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances ....................................... 155
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual:
Cable TV Special Revenue Fund .............................................................................................................. 160
Asset Seizure Special Revenue Fund ........................................................................................................ 161
Alternative Transportation Special Revenue Fund ................................................................................... 162
RMRA Gas Tax Special Revenue Fund ................................................................................................... 163
Special Gas Tax Special Revenue Fund ................................................................................................... 164
Traffic Safety Special Revenue Fund ....................................................................................................... 165
Measure I Special Revenue Fund ............................................................................................................. 166
Verdemont Capital Projects Fund ............................................................................................................. 167
Storm Drain Construction Capital Projects Fund ..................................................................................... 168
Special Assessments Capital Projects Fund .............................................................................................. 169
Cultural Development Construction Fee Capital Projects Fund ............................................................... 170
Impact Fees Capital Projects Fund ........................................................................................................... 171
Internal Service Funds:
Combining Statement of Net Position ............................................................................................................ 174
Combining Statement of Revenues, Expenses, and Changes in Net Position ................................................ 175
Combining Statement of Cash Flows ............................................................................................................. 176
Fiduciary Funds:
Combining Statement of Fiduciary Assets and Liabilities – Agency Funds .................................................. 180
Combining Statement of Changes in Fiduciary Assets and Liabilities – Agency Funds ............................... 182
City of San Bernardino
Comprehensive Annual Financial Report
For the Year Ended June 30, 2019
Table of Contents (Continued)
Page
STATISTICAL SECTION (Unaudited)
Description of Statistical Section Contents .................................................................................................................. 187
Financial Trends:
Net Assets by Component – Last Ten Fiscal Years ............................................................................................... 188
Changes in Net Position – Last Ten Fiscal Years .................................................................................................. 190
Fund Balances of Governmental Funds – Last Ten Fiscal Years .......................................................................... 194
Changes in Fund Balances of Governmental Funds – Last Ten Fiscal Years ....................................................... 196
Tax Revenues by Source – Governmental Funds – Last Ten Fiscal Years ........................................................... 198
Revenue Capacity:
Assessed Value and Estimated Actual Value of Taxable Property – Last Ten Fiscal Years ................................. 199
Taxable Sales by Category – Last Ten Calendar Years ......................................................................................... 200
Principal Sales Tax Remitters – Current Year and Nine Years Ago ..................................................................... 203
Direct and Overlapping Property Tax Rates – Last Ten Fiscal Years ................................................................... 204
Principal Property Taxpayers – Current Year and Ten Years Ago ........................................................................ 205
Property Tax Levies and Collections – Last Ten Fiscal Years .............................................................................. 206
Top 10 Customers - Water, Sewer Treatment, Sewer Collection – Current Year ................................................. 207
Connections and Revenues by User Type – Water – Last Ten Fiscal Years ......................................................... 208
Water Rate History - Minimum Monthly Charge – Last Ten Fiscal Years ........................................................... 209
Connections and Revenues by User Type - Sewer Treatment – Last Ten Fiscal Years ........................................ 210
Sewer Treatment Rate History – Last Ten Fiscal Years ........................................................................................ 211
Connections and Revenues by User Type - Sewer Collection – Last Three Fiscal Years ..................................... 212
Sewer Collection Rate History – Last Ten Fiscal Years ........................................................................................ 213
Debt Capacity Schedules:
Ratio of Outstanding Debt by Type – Last Ten Fiscal Years ................................................................................ 214
Ratio of General Bonded Debt Outstanding – Last Ten Fiscal Years ................................................................... 216
Schedule of Direct and Overlapping Bonded Debt– Current Fiscal Year ............................................................. 217
Legal Debt Margin – Last Ten Fiscal Years .......................................................................................................... 218
Debt Service Coverage – Last Ten Fiscal Years .................................................................................................... 220
Demographic and Economic Information:
Demographic and Economic Statistics – Last Ten Calendar Years ....................................................................... 221
Principal Employers – Current Year and Nine Years Ago .................................................................................... 222
Budgeted Full-Time and Part-Time Positions by Function – Last Ten Fiscal Years ............................................ 223
Operating Information:
Capital Asset Statistics – Last Ten Fiscal Years .................................................................................................... 224
Operating Indicators by Function – Last Ten Fiscal Years ................................................................................... 225
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January 28, 2020
To the Mayor, Members of the City Council and Citizens of the City of San Bernardino:
We are pleased to submit the Comprehensive Annual Financial Report (CAFR) of the City of
San Bernardino (City) for the fiscal year ended June 30, 2019. This report is published in
accordance with local ordinance and state law requirements that financial statements be
presented in conformity with generally accepted accounting principles (GAAP) and audited in
accordance with generally accepted auditing standards by an independent public accounting
firm of licensed certified public accountants.
City management assumes full responsibility for the completeness and reliability of the
information contained in this report. We believe the data fairly represents the financial position
and results of operations of the City. The disclosures necessary to enable the reader to
understand the City's financial affairs have been included. The City's accounting system has
been developed and maintained with due consideration given to the adequacy of internal
controls. Because the cost of internal controls should not exceed the anticipated benefits, the
objective is to provide reasonable, rather than absolute, assurance that the financial statements
are free of any material misstatements. The evaluation of the costs and benefits of a particular
control requires estimates and judgments by management.
The Pun Group, LLP, a firm of licensed certified public accountants, has audited the City's
financial statements. The goal of the independent audit was to provide reasonable assurance
the City's financial statements for the fiscal year ended June 30, 2019 are free of material
misstatement. The independent auditor concluded it was reasonable to render an unmodified
opinion and that the City's financial statements for the fiscal year ended June 30, 2019, are
fairly presented in conformity with GAAP. The independent auditor’s report is presented as the
first component of the financial section of this report.
In addition, the Pun Group, LLP audited the City’s major program expenditures of federal funds
for compliance with Title 2 of the United States Code of Federal Regulations Part 200 (Uniform
Guidance), and the standards applicable to financial audits contained in Government Auditing
Standards. The report of the Single Audit is published separately from the CAFR and may be
obtained upon request from the City’s Finance Department.
Management’s discussion and analysis (MD&A) immediately follows the independent auditor’s
report and provides a narrative overview and analysis of the basic financial statements. This
letter of transmittal is designed to complement the MD&A and should be read in conjunction with
it.
290 North D St, San Bernardino, CA 92401 | P: 909‐384‐5242 | F: 909‐384‐5043| www.SBCity.org
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Profile of the Government
The City of San Bernardino, incorporated as a Charter City in 1854, is located in Southern
California, approximately 60 miles east of Los Angeles and 55 miles west of Palm Springs. The
City has a land area of approximately 59.3 square miles and population of over 213,000. The
City is the County Seat of San Bernardino County, the largest county in the nation. Along with
adjacent Riverside County, these two counties comprise what is called the “Inland Empire”, so-
named because it formerly was a vast agriculture domain (primarily citrus). This area is
immediately east of the Los Angeles/Orange County metropolitan area.
The City operates under a Council-Manager form of government. Under this governance plan,
the elected Mayor and City Council appoints a full-time professional City Manager responsible
for the day-to-day administration of City government. The Mayor and City Council represent the
legislative branch of the government and are responsible for setting City policy and allocating
resources. The City Manager and staff represent the executive branch of the government and
are tasked with recommending policy and implementing the Mayor and City Council’s direction.
Each City department, office, and agency is administered by an executive appointed by and
subject to the direction and supervision of the City Manager, except the Offices of the Council,
Mayor, City Attorney and City Clerk, the Library Board of Trustees, and the Water Board, which
are administered by their respective executive officers. The City Attorney, City Clerk, and City
Manager work directly for the entire City Council and receive direction only from the full body,
acting by majority vote, conducted at a publically noticed meeting.
The City provides a broad range of services, including public safety, water and sewer,
infrastructure and highway maintenance, recreational activities, and cultural events. The City
contracts with the San Bernardino County Fire Protection District for fire protection and
emergency medical aid services. The City is financially accountable for the former economic
development agency, the Successor Agency to the former economic development agency, and
the financing authority, all of which are reported within the City’s financial statements. Additional
information regarding all three of these legally separate entities can be found in the notes to the
financial statements.
The annual budget serves as the foundation for the City’s financial planning and control. The
appropriated budget is prepared by department (e.g., police), fund (e.g. general), and program
(e.g. patrol field services). All department heads may make transfers of non-personnel
appropriations within their department if less than $25,000. Elected officials may also make
transfers of personnel appropriations within their department. All other transfers of
appropriations, however, require the special approval of the City Council. Budget-to-actual
comparisons are provided in this report for each individual governmental fund for which an
appropriated annual budget has been adopted. For the general fund and major special revenue
funds, this comparison is presented as part of the required supplementary information in the
accompanying financial statements. For governmental funds that have appropriated annual
budgets, other than the general fund and major special revenue funds, this comparison is
presented in the supplementary section of the accompanying financial statements.
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Economic Condition
The information presented in the financial statements is perhaps best understood when it is
considered from the broader perspective of the specific environment within which the City
operates.
Local economy. Since the Great Recession over a decade ago, the City’s bankruptcy in 2012
and the State’s dissolution of redevelopment agencies statewide, the City’s financial conditions
have been slow to recover. Nevertheless, over the last five years, the City has shown marked
improvements in the local economy improving the City’s financial position. Although the City
pledged its property tax revenue to the County of San Bernardino Fire District to provide
essential services to the Community, there has been a notable increase in taxable value of
property within the City, a clear reflection of improvements in the local economy. Specifically,
the City of San Bernardino experienced a net taxable value increase of 9.5% for the 2019-
property tax roll, which was a greater increase than the 6.5% growth expected countywide. The
assessed value increase between 2018-19 and 2019-20 was $1.3 billion.
As it relates to the median home price in the City, over the last six years the City has also seen
a continued rise in the value of single-family properties in the community. From 2018 to 2019,
the median home price increased 7.4% to a median home value of $290,000.
Development activities in the City continue to be robust and active as developers see the
advantage of developing in this centralized location in the Inland Empire. Development on and
around the San Bernardino International Airport (SBIA) continues to grow as a major logistics
hub in Southern California. There has been over 15 million square feet of distribution, logistics
and fulfillment centers constructed around SBIA over the last decade and an additional 3.3
million square feet are either under construction or are planned for development in this area of
the City. Some of the major land owners and tenants in this area include Amazon.com, Stater
Bros. Markets, Kohl’s, Trader Joe’s, Mattel and PepBoys.
Development in the Hospitality Lane area just north of the 10 Freeway has seen interest from
the hotel industry. The Double Tree Hotel just finished a multi-million dollar remodel to their
hotel and the La Quinta Inn and Suites finished the development of their new hotel just next
door. There are also three additional mid-range hotels that are also slated for development over
the next two years. To date, the City has not seen a slowdown in these development activities.
Cash management policies and practices. Cash temporarily idle during the year was
invested by the City Treasurer in investments authorized by the City’s Investment Policy,
including obligations of the U.S. Treasury, corporate bonds, investment contracts, and the State
Treasurer’s investment pool. The maturities of the investments range from current to 5 years,
with average days to maturity of 302 at June 30, 2019. The average yield on investments was
2.18 percent. Investment income includes changes in the fair value of investments. Changes in
fair value during the current year, however, do not necessarily represent trends that will
continue; nor is it always possible to realize such amounts, especially in the case of temporary
changes in the fair value of investments that the City intends to hold to maturity. The City
Treasurer, as required by the California Government Code section 53601, has prepared an
annual Statement of Investment Policy which allows the City to meet current obligations while
earning a market rate of return. Further information regarding the City’s cash and investments
can be found under Note 2 in the Notes to the Financial Statements.
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iv
Risk management. The City of San Bernardino is self-insured for workers’ compensation and
liability with self-insured retentions (SIR) of $1 million. The unpaid claims and judgments
payable as of June 30, 2019 for these activities is $6.2 million. Excess coverage is currently
maintained by CSAC Excess Insurance Authority for worker’s compensation for coverage in
excess of the City’s SIR of $1 million, with limits of $50 million. The City’s current excess stand-
alone coverage for liability includes the following insurance carriers: Allied World, Berkley
National and Arch Insurance Company with an SIR of $1 million with limits of $30 million.
Additional information on the City’s risk management activity can be found under Note 9 in the
Notes the Financial statements.
Long-term Financial Planning. Economic growth, while marginal in the City, has increased
the demand for vital City services. These issues were reflected in the setting of City Council
priorities for 2018:
The City has developed a Strategic Plan with established goals from which budgetary decisions
are made. The Plan is periodically updated and the City is consistently working to achieve these
goals.
City goals for fiscal years 2018 – 2019 are as follows:
1. Implement the City Vision
2. Provide for the Safety of City Residents and Businesses
3. Create, Maintain and Grow Jobs and Economic Value in the City
4. Ensure Development of a Well-Planned, Balanced, and Sustainable City
5. Improve City Government Operations
6. Operate in a Fiscally Responsible and Business-like Manner
7. Pursue City Goals and Objectives by Working with Other Agencies
Substantial progress has been made towards the accomplishment of these goals.
The City has also developed a Five-Year Capital Improvement Plan detailing specific capital
projects planned for each City department. Each project is consistent with the overall goals and
objectives of the City as outlined in the Strategic and General Plans. The current Five-Year
Capital Improvement Plan proposed at adoption $46 million of capital projects for the Fiscal
Year 2018-19 including $9.6 million for City Facilities, $3.9 million for Park Improvements, $5.5
million for Police Facility Improvements, $5 million for Storm Drains, $18.4 million for Streets,
$3.3 million for Traffic Controls, and $150,000 for Landfills.
Finally, we would like to express our appreciation to the Mayor, City Council, City employees
and the community for their leadership and support in maintaining the highest standards of
professionalism in the management of the City’s Finances.
Respectfully submitted,
Teri Ledoux Paul Espinoza
City Manager Director of Finance
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vi
CITY OF SAN BERNARDINO, CALIFORNIA
CITY OFFICIALS
JUNE 30, 2019
LEGISLATIVE OFFICIALS
John Valdivia ………………………………………………………………………………. Mayor*
Theodore Sanchez ……………………………………………….. Member of City Council-Ward 1*
Sandra Ibarra …………………………………………………….. Member of City Council-Ward 2*
Juan Figeroa ……………………………………………………... Member of City Council-Ward 3*
Fred Shorett ………………………………………………...….... Member of City Council-Ward 4*
Henry Nickel …………………………………………………….. Member of City Council-Ward 5*
Bessine L. Richard ………………………………………………. Member of City Council-Ward 6*
James L. Mulvihill ………………………………………………. Member of City Council-Ward 7*
CHIEF ADMINISTRATIVE OFFICERS
Teri Ledoux ………………………………………………………………………….... City Manager
Miguel J. Guerrero …………….... General Manager, San Bernardino Municipal Water Department
DEPARTMENT HEADS
Georgeann Hanna ……………………………………………………………………….. City Clerk*
Gary D. Saenz ………………………………………………………………………... City Attorney*
Vacant ……………………………………………………………………………..... City Treasurer*
Michael A. Huntley ………………………….. Director of Community and Economic Development
Paul Espinoza ………………………………………………………………….... Director of Finance
Helen Tran ……………………………………….……………...….... Director of Human Resources
Mitch Cochran ……………………………………………….... Director of Information Technology
Jim Tickemyer ……………………………………………….….... Director of Parks and Recreation
Eric McBride ………………………………………………………………………… Chief of Police
Alex Qishta ……………………………………………………….. Acting Director of Public Works
Edward Erjavek …………………………………………………………………….. Library Director
*Elected Officials
City of San Bernardino
Organizational Chart
June 30, 2019
Citizens of
San Bernardino
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viii
INDEPENDENT AUDITORS’ REPORT
To the Honorable Mayor and Members of the City Council
of the City of San Bernardino
San Bernardino, California
Report on Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business-type activities,
each major fund, and the aggregate remaining fund information of the City of San Bernardino, California (the “City”),
as of and for the year ended June 30, 2019, and the related notes to the basic financial statements, which collectively
comprise the City’s basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with
accounting principles generally accepted in the United States of America; this includes the design, implementation,
and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are
free from material misstatement, whether due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We did not audit the
financial statements of the Water Enterprise Fund, Sewer Enterprise Fund, and the Sewer Collection Enterprise Fund
(major funds), which collectively represent the following percentages of assets, net position, and expenses of the
following opinion units:
Those statements were audited by other auditors whose reports have been furnished to us, and our opinions, insofar
as they relate to the amounts included for the Water Enterprise Fund, Sewer Enterprise Fund, and the Sewer Collection
Enterprise Fund, are based solely on the reports of the other auditors.
We conducted our audit in accordance with auditing standards generally accepted in the United States of America
and the standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement.
Opinion Unit Assets Net Position Expenses
Business-type Activities 98.34%99.18%99.03%
Major Enterprise Fund:
Water Enterprise Fund 100.00% 100.00% 100.00%
Sewer Enterprise Fund 100.00% 100.00% 100.00%
Sewer Collection Enterprise Fund 100.00% 100.00% 100.00%
200 E. Sandpointe Avenue, Suite 600, Santa Ana, California 92707
Tel: 949-777-8800 • Fax: 949-777-8850 • www.pungroup.com
3939352 Pun & McGeady_L_final.pdf 1 1/14/14 3:48 PM
To the Honorable Mayor and Members of the City Council
of the City of San Bernardino
San Bernardino, California
Page 2
2
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of
material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments,
the auditor considers internal control relevant to the City’s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the City’s internal control. Accordingly, we express no such opinion. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinions.
Opinions
In our opinion, based on our audit and the report of other auditors, the financial statements referred to above present
fairly, in all material respects, the respective financial position of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2019, and the
respective changes in financial position, and where applicable, cash flows thereof for the year then ended in
accordance with accounting principles generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management’s Discussion
and Analysis, Budgetary Comparison Schedules, Schedule of Funding Progress for Other Postemployment Benefits,
Schedules of Changes in the Net Pension Liability and Related Ratios, Schedule of Proportionate Share of the Net
Pension Liability and Related Ratios, Schedules of Contributions – Pension, Schedule of Changes in the Net OPEB
Liability and Related Ratios, and Schedule of Contributions - OPEB, as listed in the foregoing table of contents, be
presented to supplement the basic financial statements. Such information, although not a part of the basic financial
statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of
financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical
context. We have applied certain limited procedures to the Required Supplementary Information in accordance with
auditing standards generally accepted in the United States of America, which consisted of inquiries of management
about the methods of preparing the information and comparing the information for consistency with management’s
responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the
basic financial statements. We do not express an opinion or provide any assurance on the information because the
limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise
the City’s basic financial statements. The Introductory Section, the Combining Nonmajor Fund Financial Statements
and the budgetary comparison schedules, and the Statistical Section are presented for purposes of additional analysis
and are not a required part of the basic financial statements.
To the Honorable Mayor and Members of the City Council
of the City of San Bernardino
San Bernardino, California
Page 3
3
The Combining Nonmajor Fund Financial Statements and the budgetary comparison schedules on pages 150 through
171 are the responsibility of management and were derived from and relate directly to the underlying accounting and
other records used to prepare the basic financial statements. Such information has been subjected to the auditing
procedures applied in the audit of the basic financial statements and certain additional procedures, including
comparing and reconciling such information directly to the underlying accounting and other records used to prepare
the basic financial statements or to the basic financial statements themselves, and other additional procedures in
accordance with auditing standards generally accepted in the United States of America. In our opinion, the
Combining Nonmajor Fund Financial Statements are fairly stated in all material respects in relation to the basic
financial statements as a whole.
The Introductory and Statistical Sections have not been subjected to the auditing procedures applied in the audit of
the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated January 28, 2020, on our
consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain
provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely
to describe the scope of our testing of internal control over financial reporting and compliance and the results of that
testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on
compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards
in considering the City’s internal control over financial reporting and compliance.
Santa Ana, California
January 28, 2020
4
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City of San Bernardino
Management’s Discussion and Analysis (Unaudited)
For the Fiscal Year Ended June 30, 2019
5
As management of the City of San Bernardino (City), California, we offer readers of the City's financial statements
this narrative overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2019. We
encourage readers to consider the information presented here in conjunction with additional information that we have
furnished in our letter of transmittal, which can be found in the introductory section of this report, and with the City's
financial statements, which follow this discussion.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the City's basic financial statements. The City's
basic financial statements consist of three components: 1) government-wide financial statements, 2) fund financial
statements, and 3) notes to the basic financial statements. This report also contains other supplementary information in
addition to the basic financial statements themselves.
Government-Wide financial statements
The government-wide financial statements are designed to provide readers with a broad overview of the City's finances,
in a manner similar to a private-sector business.
The Statement of Net Position presents information on all of the City's assets and liabilities, with the difference between
the two reported as net position. Over time, changes in the net position may serve as a useful indicator of whether the
financial position of the City is improving or deteriorating.
The Statement of Activities presents information illustrating how the government's net position changed during the
most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change
occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for
some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused
vacation leave).
The government-wide financial statements present information about the functions of the City that are principally
supported by taxes and intergovernmental revenues (governmental activities). The governmental activities of the City
include general government, public safety, streets, cultures and recreation, community development, and community
services.
The government-wide financial statements include not only the City itself (known as the primary government), but
also three legally separate entities: the San Bernardino Municipal Water Department, Affordable Housing Solutions of
San Bernardino, Inc., and the San Bernardino Joint Powers Financing Authority, for which the City is financially
accountable. Although legally separate, these entities function for all practical purposes as a department of the City,
and therefore has been included as an integral part of the primary government. The government-wide financial
statements immediately follow this discussion and analysis.
Fund financial statements
A fund is a grouping of related accounts used to maintain control over resources that have been segregated for specific
activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and
demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into three
categories: governmental funds, proprietary funds, and fiduciary funds.
City of San Bernardino
Management’s Discussion and Analysis (Unaudited) (Continued)
For the Fiscal Year Ended June 30, 2019
6
Governmental funds
Governmental funds are used to account for essentially the same functions reported as governmental activities in the
government-wide financial statements. However, unlike the government-wide financial statements, governmental fund
financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of
spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's
near-term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful
to compare the information presented for governmental funds with similar information presented for governmental
activities in the government-wide financial statements. By doing so, readers may better understand the long-term
impact of the government's near-term financing decisions. Both the governmental fund Balance Sheet and the
governmental fund Statement of Revenues, Expenditures, and Changes in Fund Balances provides a reconciliation to
facilitate this comparison between governmental funds and governmental activities.
The City maintains various individual governmental funds. Information is presented separately in the Governmental
Funds Balance Sheet, and in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund
Balances, for the General Fund and Federal and State Grants Fund, both of which are considered major funds. Data
from other governmental funds are combined into a single, aggregated presentation. Individual fund data for each of
these other governmental funds is provided in the form of combining statements elsewhere in this report.
The basic financial statements also include budgetary comparison statements for the General Fund and all Special
Revenue funds to demonstrate compliance with the annual budget as adopted (original) and amended (final).
The basic governmental fund financial statements immediately follow the government-wide financial statements.
Proprietary funds
The City maintains various enterprise funds to report the business-type activities of the Water Fund, Sewer Fund,
Sewer Collection Fund, and Integrated Waste Fund. The City also maintains various internal service funds, which are
an accounting device used to accumulate and allocate costs internally among the City's various functions. The City
uses internal service funds to account for its self-insurance activities, vehicle fleet operations, and information
technology systems. Because these services benefit governmental functions, they have been included within
governmental activities in the government-wide financial statements.
Proprietary funds provide the same type of information as the Government-wide Financial Statements, only in more
detail. The internal service funds are combined into a single, aggregated presentation in the proprietary fund financial
statements. Individual fund data for the internal service funds is provided in the form of combining statements
elsewhere in this report.
The basic proprietary fund financial statements immediately follow the basic governmental fund financial statements.
City of San Bernardino
Management’s Discussion and Analysis (Unaudited) (Continued)
For the Fiscal Year Ended June 30, 2019
7
Fiduciary funds
Fiduciary funds account for resources held for the benefit of parties outside the government. Fiduciary funds are not
included in the government-wide financial statement because the resources of those funds are not available to support
the City's programs. The basic fiduciary fund financial statements immediately follow the basic proprietary fund
financial statements.
Notes to the basic financial statements
The notes to the basic financial statements provide additional information that is essential to a full understanding of
the data provided in the government-wide and fund financial statements. The notes to the basic financial statements
immediately follow the basic fiduciary fund financial statements.
Other information
In addition to the basic financial statements and accompanying notes, this report also presents certain required
supplementary information concerning the City's annual required contribution to the Defined Benefit Pension Plans
and Other Post Employment Benefit Plan. Required supplementary information immediately follows the notes to the
basic financial statements. The combining statements referred to earlier in connection with other governmental funds
and internal service funds for non-major Special Revenue Funds, Debt Service Fund, Capital Projects Funds, and
Internal Service Funds. These combining and individual fund statements and schedules immediately follow the
required supplementary information.
Financial Highlights
At June 30, 2019, the City’s total net position was $374.29 million, an $8.94 million decrease from the prior
fiscal year, primarily due to the City’s Sewer Utility fund liquidating a fiduciary fund agreement and remitting
the funds back to the government agency and increased expenses related to street improvements and capital
projects.
During the year, the City recorded a $24.90 million prior period adjustment to adjust certain Notes Receivable,
the corresponding Allowance for Doubtful Accounts, and property held for resale to their net realizable value
at June 30, 2019 as determined by management. Additional information on the prior period adjustments can
be found under Note 16 in the Notes to the Financial Statements.
As of June 30, 2019, the City’s governmental funds reported a combined ending fund balance of $162.56
million, an increase of $747 thousand compared to the prior year.
At June 30, 2019, the total committed, assigned, and unassigned fund balance for the General Fund was $31.61
million or 22 percent of total general fund expenditures.
Government-wide Financial Analysis
The government-wide financial statements provide long-term and short-term information about the City's overall
financial condition. This analysis addresses the financial statements of the City as a whole.
City of San Bernardino
Management’s Discussion and Analysis (Unaudited) (Continued)
For the Fiscal Year Ended June 30, 2019
8
Net Position
Net position may serve over time as a useful indicator of a government’s financial condition. In the case of the City,
as of June 30, 2019, assets and deferred outflows exceeded liabilities and deferred inflows by $374.29 million.
Approximately $546.55 million of the City's net position reflects its net investment in capital assets (e.g., land and
easements, infrastructure, buildings and improvements, machinery, vehicles, and equipment, water rights, wells, and
pumping, distribution and collection systems, and construction in progress); less any related outstanding debt used to
acquire those assets. The City uses these capital assets to provide services to residents; consequently, these assets are
not available for future spending. Although the City's investment in its capital assets is reported net of related debt, it
should be noted that the resources needed to repay this debt must be provided from other sources, since the capital
assets themselves cannot be used to liquidate these liabilities.
A portion of the City’s net position, $132.13 million, represents resources that are subject to external restrictions on
how they may be used. The remaining balance is a deficit in unrestricted net position of $(304.39) million. This deficit
reflects liabilities which exceed assets on hand and is related to the implementation of GASB 68 regarding Pension
Plan reporting, GASB 75 regarding OPEB liability reporting, and other long-term liabilities such as obligations for
claims and judgments.
2019
Restated
2018 2019
Restated
2018 2019
Restated
2018
Assets
Current and other assets 187,255,869$ 182,267,222$ 231,399,500$ 228,337,301$ 418,655,369$ 410,604,523$
Capital Assets, net 296,311,492 302,609,450 285,505,777 275,317,300 581,817,269 577,926,750
Total Assets 483,567,361 484,876,672 516,905,277 503,654,601 1,000,472,638 988,531,273
Deferred Outflows of Resources
Pension related items 45,181,346 74,412,365 5,636,517 14,000,595 50,817,863 88,412,960
OPEB related items - - 3,057,917 2,673,389 3,057,917 2,673,389
Total Deferred Outflows of Resources 45,181,346 74,412,365 8,694,434 16,673,984 53,875,780 91,086,349
Liabilities
Other liabilities 28,870,473 23,920,823 14,655,092 13,995,010 43,525,565 37,915,833
Long-term liabilities 415,998,557 425,981,576 212,098,865 218,072,777 628,097,422 644,054,353
Total Liabilities 444,869,030 449,902,399 226,753,957 232,067,787 671,622,987 681,970,186
Deferred Inflows of Resources
Pension related items 5,828,212 9,660,800 778,901 3,964,903 6,607,113 13,625,703
OPEB related items - - 1,829,014 793,000 1,829,014 793,000
Total Deferred Inflows of Resources 5,828,212 9,660,800 2,607,915 4,757,903 8,436,127 14,418,703
Net Position
Net investment in capital assets 286,878,015 291,168,979 259,671,498 248,654,078 546,549,513 539,823,057
Restricted 98,129,481 114,629,131 33,999,584 8,363,037 132,129,065 122,992,168
Unrestricted (306,956,031) (306,072,272) 2,566,757 26,485,780 (304,389,274) (279,586,492)
Total Net Position 78,051,465$ 99,725,838$ 296,237,839$ 283,502,895$ 374,289,304$ 383,228,733$
Activities Activities Total
Business-TypeGovernmental
City of San Bernardino
Management’s Discussion and Analysis (Unaudited) (Continued)
For the Fiscal Year Ended June 30, 2019
9
During the fiscal year ended June 30, 2019, the net position of the City decreased by $8.94 million to $374.29 million,
as summarized below.
2019 2018 2019 2018 2019 2018
Revenues
Program Revenues:
Charges for services 20,390,086$ 21,240,186$ 76,725,422$ 75,999,570$ 97,115,508$ 97,239,756$
Operating grants and contributions 24,786,515 21,652,775 1,832,879 1,776,883 26,619,394 23,429,658
Capital grants and contributions 270,819 283,942 10,121,344 4,854,784 10,392,163 5,138,726
Property taxes 17,101,369 18,498,848 - - 17,101,369 18,498,848
Sales taxes 49,450,785 43,890,011 - - 49,450,785 43,890,011
Franchise taxes 11,550,447 10,657,848 - - 11,550,447 10,657,848
Utilities user taxes 22,924,522 23,666,459 - - 22,924,522 23,666,459
Transient occupancy taxes 4,950,170 4,987,491 - - 4,950,170 4,987,491
Other taxes 8,217,876 8,153,029 - - 8,217,876 8,153,029
Investment earnings 3,864,707 1,479,966 3,112,261 534,899 6,976,968 2,014,865
Other revenues 2,979,410 4,936,032 2,044,179 1,749,331 5,023,589 6,685,363
Total Revenues 166,486,706 159,446,587 93,836,085 84,915,467 260,322,791 244,362,054
Expens es
General government 29,494,169 29,093,189 - - 29,494,169 29,093,189
Public safety 98,603,681 97,710,294 - - 98,603,681 97,710,294
Streets 44,613,103 33,332,099 - - 44,613,103 33,332,099
Culture and recreation 3,712,899 8,474,953 - - 3,712,899 8,474,953
Community development 6,679,568 4,808,376 - - 6,679,568 4,808,376
Community service 4,195,874 2,723,132 - - 4,195,874 2,723,132
Interest on long-term debt 861,785 1,126,611 - - 861,785 1,126,611
Water - - 35,988,661 36,461,897 35,988,661 36,461,897
Sewer - - 27,787,317 25,258,155 27,787,317 25,258,155
Sewer Collection - - 8,172,922 11,667,157 8,172,922 11,667,157
Integrated Waste - - 777,167 1,177,266 777,167 1,177,266
Total Expenditures 188,161,079 177,268,654 72,726,067 74,564,475 260,887,146 251,833,129
Excess (deficiency) of Revenues over (under)
expenditures before extraordinary items (21,674,373) (17,822,067) 21,110,018 10,350,992 (564,355) (7,471,075)
Capital contributions and transfers - 590,005 (8,375,074) - (8,375,074) 590,005
Special item - restatement of Notes Receivable - (24,902,675) - - - (24,902,675)
Change in Net Position (21,674,373) (42,134,737) 12,734,944 10,350,992 (8,939,429) (31,783,745)
Net Position - beginning, as restated 99,725,838 141,860,575 283,502,895 273,151,903 383,228,733 415,012,478
Net Position - ending 78,051,465$ 99,725,838$ 296,237,839$ 283,502,895$ 374,289,304$ 383,228,733$
Business-Type
Activities Total
Governmental
Activities
City of San Bernardino
Management’s Discussion and Analysis (Unaudited) (Continued)
For the Fiscal Year Ended June 30, 2019
10
Changes in Net Position – Governmental Activities
Revenues related to the City’s Governmental activities totaled $166.49 million for the fiscal year ended June 30, 2019,
an increase of $7.04 million, or 4 percent, from the prior year. The primary causes for the overall increase were:
Sales tax revenue, which increased $5.56 million, or 13 percent, from the prior year due to delayed payments
for the previous fiscal year being received in fiscal year 2019.
Operating grants and contributions revenue, which increased $3.13 million, or 14 percent, from the prior year
due to increased allocations received from other governmental agencies to fund street maintenance and other
capital projects.
Other revenues, which decreased by $1.96 million, or 40 percent, from the prior year due to various one-time
gains recognized in conjunction with the refinance of the City’s 1996 Lease Revenue Refunding Bonds in the
previous fiscal year.
Expenses related to the City’s Governmental activities totaled $188.16 million for the fiscal year ended June 30, 2019,
an increase of $10.89 million, or 6 percent, from the prior year. The primary causes for the overall increase were:
Expenses related to streets and public works, which increased $11.28 million, or 34 percent, from the prior
year due to increased spending on street improvements and related capital projects during the current year. In
addition, expenses related to parks maintenance were moved from culture and recreation to public works for
the fiscal year ended June 30, 2019.
Culture and recreation expenses, which decreased $4.76 million, or 56 percent, from the prior year due
primarily to the parks maintenance expenses that were moved to public works during the year.
Community service expenses, which increased by $1.47 million, or 54 percent, from the prior year due to
construction costs and increased capital project activity in the current fiscal year.
Changes in Net Position – Business-Type Activities
Revenues related to the City’s Business-Type activities totaled $93.84 million for the fiscal year ended June 30, 2019,
an increase of $8.92 million, or 11 percent, from the prior year. The primary causes for the overall increase were:
Capital grants and contributions, which increased $5.27 million from the prior year due primarily to a large
capital contribution of land to the Sewer Utility fund.
Revenue related to investment earnings, which increased $2.58 million from the prior year due to favorable
market conditions, particularly related to investment activities in the Sewer Utility fund.
Fund Financial Analysis
As detailed above, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal
requirements.
Governmental Funds
The focus of the City's governmental funds is to provide information on near-term inflows, outflows and balances of
spendable resources. Such information may be useful in assessing the City's financing requirements.
City of San Bernardino
Management’s Discussion and Analysis (Unaudited) (Continued)
For the Fiscal Year Ended June 30, 2019
11
As of June 30, 2019, the City's governmental funds reported total combined ending fund balances of $162.56 million,
an increase of $747 thousand from the prior year. Approximately 19 percent of the City's governmental funds' fund
balances, or $31.58 million, constitutes committed, assigned, and unassigned fund balance, which is available for
spending at the government's discretion within the guidelines of the funding sources. The remaining fund balance,
$130.98 million, is either nonspendable or restricted for purposes imposed by creditors, grantors, contributors, laws or
regulations of other governments or through enabling legislation.
General Fund Financial Highlights
The general fund is the chief operating fund of the City. At June 30, 2019, committed and unassigned fund balance of
the general fund was $31.61 million, while total fund balance was $64.54 million. As a measure of the general fund's
liquidity, it is useful to compare committed and unassigned fund balance to total fund expenditures. Committed and
unassigned fund balance represents 22 percent of the total general fund expenditures. The City Council has designated
all of the committed fund balances for specified purposes.
The fund balance of the General Fund decreased by $7.55 million during the current fiscal year, primarily due to
transfer of over $7 million to remediate a deficit in the Special Gas Tax Fund.
2019 2018
Revenues
Taxes 105,604,698$ 101,436,301$
Licenses and permits 11,567,573 11,012,115
Charges for services 7,021,328 6,681,515
Use of money and property 1,048,252 70,145
Intergovernmental 1,332,916 1,319,468
Othe r 6,396,289 9,043,120
Total Revenues 132,971,056 129,562,664
Expenditures
Current:
General government 22,905,192 23,157,298
Public safety 81,553,652 73,434,759
Streets 24,119,892 9,198,355
Culture and recreation 3,424,819 7,018,921
Community development 4,015,206 4,607,348
Community service 2,454,631 2,055,542
Debt Service:
Principal 1,517,120 5,531,768
Interest and fiscal charges 589,633 893,441
Total Expenditures 140,580,145 125,897,432
Excess (Deficiency) of Revenues Over
(Under) Expenditures (7,609,089) 3,665,232
Proceeds from debt issuance - 4,414,002
Net transfers - 360,350
Sale of capital assets 58,949 -
Net Change in Fund Balances (7,550,140)$ 8,439,584$
City of San Bernardino
Management’s Discussion and Analysis (Unaudited) (Continued)
For the Fiscal Year Ended June 30, 2019
12
General Fund revenues for the fiscal year ended June 30, 2019, increased by $3.41 million, or approximately 3 percent,
over the prior year. Taxes contributed to the majority of the increase at $4.17 million, a 4 percent increase over last
year. The largest increase within the taxes was sales tax, which increased $5.56 million, or approximately 13 percent
over the prior year due to delayed payments for the previous fiscal year being received in fiscal year 2019.
Total General Fund expenditures increased by $14.68 million, or 12 percent, from the prior year. The overall increase
was due to the following factors:
Public safety expenditures increased by $8.12 million to $81.55 million due to increased personnel costs
associated with CalPERS pension obligations and negotiated salary adjustments, as well as various litigation
settlement payments.
Public works (streets) expenditures increased by $14.92 million to $24.12 million due to increased spending
for street maintenance, parks maintenance, and other capital projects.
Culture and recreation expenditures decreased by $3.59 million to $3.42 million. The decrease was primarily
the result of decreased parks maintenance costs, which were transferred to public works during the year.
Community development expenditures decreased by $592 thousand to $4.02 million as a result of savings in
the property maintenance division that was formerly under the City’s EDA program.
Debt service expenditures for principal and interest payments also decreased by $4.01 million and $304
thousand, respectively, from the prior fiscal year. The decreases are due to the refunding of the City’s 1996
Lease Revenue Refunding Bonds in the prior fiscal year and the resulting interest savings in the current fiscal
year.
City of San Bernardino
Management’s Discussion and Analysis (Unaudited) (Continued)
For the Fiscal Year Ended June 30, 2019
13
General Fund Budgetary Highlights
During the year, the City’s adopted General Fund revenue and expenditure budgets were amended. The amendments
included adjustments for carryovers of unspent funds from the previous fiscal year and other capital projects throughout
the City. These amendments to original budgeted appropriations were authorized by City Council during the mid-year
review. Differences between the General Fund adopted (original) budget and the amended (final) budget are detailed
below:
Original Final
Actual
Amounts
Variance with
Final Budget -
Positive
(Negative)
Revenues
Taxes 103,345,000$ 103,345,000$ 105,604,698$ 2,259,698$
Licenses and permits 10,155,000 10,155,000 11,567,573 1,412,573
Fines and forfeitures 1,740,000 1,890,000 2,281,190 391,190
Use of money and property 350,000 350,000 1,048,252 698,252
Lease revenue 840,000 840,000 1,099,730 259,730
Intergovernmental 1,130,000 1,145,000 1,332,916 187,916
Charges for services 5,484,600 5,484,600 7,021,328 1,536,728
Other revenues 4,597,500 4,602,500 3,015,369 (1,587,131)
Total Revenues 127,642,100 127,812,100 132,971,056 5,158,956
Expenditures
Current
General government 17,853,442 18,556,192 22,905,192 (4,349,000)
Public safety 83,669,246 84,430,498 81,553,652 2,876,846
Streets 10,260,011 27,691,345 24,119,892 3,571,453
Culture and recreation 7,375,843 3,485,039 3,424,819 60,220
Community development 4,783,461 4,771,899 4,015,206 756,693
Community service 2,688,599 2,585,313 2,454,631 130,682
Debt Service
Principal 1,785,000 1,785,000 1,517,120 267,880
Interest and fiscal charges - - 589,633 (589,633)
Total Expenditures 128,415,602 143,305,286 140,580,145 2,725,141
Excess (Deficiency) of Revenues Over (Under) Expenditures (773,502) (15,493,186) (7,609,089) 2,433,815
Sale of capital assets - - 58,949 58,949
Total Sale of capital assets - - 58,949 58,949
Net Change in Fund Balances (773,502) (19,693,186) (7,550,140) 6,692,764
Fund Balances - Beginning 72,090,552 72,090,552 72,090,552 -
Fund Balances - Ending 71,317,050$ 52,397,366$ 64,540,412$ 6,692,764$
Budgeted Amounts
City of San Bernardino
Management’s Discussion and Analysis (Unaudited) (Continued)
For the Fiscal Year Ended June 30, 2019
14
Other Major Fund Financial Highlights
The Federal and State Grants Fund is used to account for various grants awarded to the City by Federal, State, and
local governments not otherwise accounted for in the General Fund or Capital Projects funds. Current year revenues
totaled $10.79 million and current year expenditures totaled $10.58 million, resulting in an increase in net position of
$205 thousand for the current year. At June 30, 2019, the fund balance was $18.09 million, all of which was restricted
for specific purposes based on the stipulations established by the granting agencies.
Business-Type Funds
As of June 30, 2019, the City's business-type funds reported total combined ending fund balances of $296.24 million,
an increase of $12.73 million from the prior year. Approximately 88 percent of the City's proprietary funds' fund
balances, or $259.67 million, represents the funds’ net investment in capital assets.
Major Fund Financial Highlights
The Water Fund is used to account for the provision of water services to the residential, commercial, and industrial
segments of the City. All activities necessary to provide such services are accounted for in this fund, including, but not
limited to, administration, operations, maintenance, financing and related debt service, and billing and collection. As
of June 30, 2019, the fund balance totaled $160.77 million, up from $151.10 million in the prior year, due to positive
net income from operations and capital contributions of $9.67 million. Total revenues increased by $843 thousand from
the prior fiscal year, despite no rate increases in the fiscal year ending June 30, 2019. Total expenses decreased by $474
thousand due to costs being more accurately allocated to the Sewer and Sewer Collection funds.
The Sewer Fund accounts for the provision of sewer treatment of residential, commercial, and industrial segments of
the City. All activities necessary to provide such services are accounted for in this fund, including, but not limited to,
administration, operations, maintenance, financing and related debt service, and billing and collection. In the current
year, the fund balance increased by $2.80 million to $103.28 million as of June 30, 2019. The increase was primarily
due to an increase in capital assets and a change in the methodology of allocating investments to all funds offset by the
liquidation of the East Trunk Line fiduciary fund.
The Sewer Collection Fund is used to account for the provision of wastewater collection to residential, commercial,
and industrial segments of the City. All activities necessary to provide such services are accounted for in this fund,
including, but not limited to, administration, operations, maintenance, financing and related debt service, and billing
and collection. As of June 30, 2019, the fund balance totaled $29.62 million, up from $29.36 million in the prior year.
Total Revenues for the Sewer Collection Fund increased $298 thousand from the prior fiscal year, primarily due to an
increase in investment income. Total expenses decreased 30 percent due to GASB 68 pension expense being allocated
differently for the fiscal year ending June 30, 2019.
The Integrated Waster Fund is used to account for the provision of refuse collection to the residential, commercial,
and industrial segments of the City. All activities necessary to provide such services are accounted for in this fund,
including, but not limited to, administration, operations, maintenance, financing and related debt service, and billing
and collection. In the current year, the fund balance remained relatively flat from the prior year, decreasing by $7
thousand to $2.57 million as of June 30, 2019.
City of San Bernardino
Management’s Discussion and Analysis (Unaudited) (Continued)
For the Fiscal Year Ended June 30, 2019
15
Capital Assets
Capital assets, including the infrastructure of the City, are those assets that are used in the performance of the City’s
functions. At June 30, 2019, capital assets totaled $296.31 million for governmental activities and $285.51 million for
business-type activities, net of accumulated depreciation on capital assets, which is recognized in the Government-
wide Financial Statements. The City’s capital assets include land and easements, infrastructure, buildings and
improvements, machinery, vehicles, and equipment, water rights, wells, and pumping, distribution and collection
systems, and construction in progress. The net increase over the prior fiscal year in the City's capital assets was $3.89
million, or a 1 percent increase.
2019 2018 2019 2018 2019 2018
Land and easements 103,334,621$ 103,334,621$ 23,213,972$ 17,624,932$ 126,548,593$ 120,959,553$
Construction in progress 15,126,024 14,500,483 7,907,281 12,741,571 23,033,305 27,242,054
Infrastructure 158,760,870 168,372,210 - - 158,760,870 168,372,210
Buildings and improvements 12,724,496 9,166,038 - - 12,724,496 9,166,038
Machinery, vehicles, and equipment 5,423,981 5,699,965 - - 5,423,981 5,699,965
Purchased software 941,500 1,536,133 - - 941,500 1,536,133
Water rights, wells, and pumping - - 60,494,000 61,335,717 60,494,000 61,335,717
Distribution and collection systems - - 120,238,521 123,564,123 120,238,521 123,564,123
Building, plant, and store yards - - 51,092,379 50,828,986 51,092,379 50,828,986
Other capital assets - - 22,559,624 9,221,971 22,559,624 9,221,971
Total Capital Assets, net 296,311,492$ 302,609,450$ 285,505,777$ 275,317,300$ 581,817,269$ 577,926,750$
Activities Activities Total
Governmental Business-Type
Major capital asset transactions during the current fiscal year included the following:
Infrastructure additions were $3.51 million. Street additions accounted for $2.66 million, traffic signal
additions totaled $568 thousand, and storm drain additions were $285 thousand.
Completed CIP projects for buildings and improvements in the City’s Governmental Activities totaled $4.55
million, consisting primarily of park improvements and renovations. In the City’s Business-Type Activities,
completed CIP projects totaled $18.43 million for various projects in the Water and Sewer Treatment Funds.
Additional information on the City’s capital assets can be found under Note 6 in the Notes to the Financial Statements.
City of San Bernardino
Management’s Discussion and Analysis (Unaudited) (Continued)
For the Fiscal Year Ended June 30, 2019
16
Long-Term Liabilities
As of June 30, 2019, the City had $116.44 million in long-term debt outstanding, a decrease of $4.49 million from the
prior year, attributable to the City’s annual debt service payments.
2019 2018 2019 2018 2019 2018
Notes payable 26,649,629$ 28,286,305$ 300,000$ 600,000$ 26,949,629$ 28,886,305$
Bonds payable - - 85,482,663 87,091,704 85,482,663 87,091,704
Lease revenue bonds 3,598,360 4,414,002 - - 3,598,360 4,414,002
California Infrstructure and Economic
Development Bank 406,234 534,311 - - 406,234 534,311
Total long term debt 30,654,223$ 33,234,618$ 85,782,663$ 87,691,704$ 116,436,886$ 120,926,322$
Activities Activities Total
Governmental Business-Type
Additional information on the City’s long-term liabilities can be found under Note 7 in the Notes to the Financial
Statements.
Economic Factors and Next Year’s Budget and Rates
The City's economy is linked to the national and state economy. In its December 2019 quarterly report, the UCLA
Anderson Forecast (Forecast) continued to anticipate modest improvement in the national economy, upgrading its GDP
growth outlook to 1.7% in 2020, citing “improved financial conditions, a better housing and employment outlook,
some relaxation of trade tensions and a modest improvement in business fixed investment.” The Forecast anticipated
the steady growth to continue within the state of California as well, calling for total employment growth rates to be
0.9% and 1.3% in 2020 and 2021, respectively.
The City’s economic recovery has followed the rest of the country and California, although at a slower pace. Median
home prices in San Bernardino increased to $290,000 from 2018 to 2019. The City’s unemployment rate of 4.10%,
although higher than the State level of 3.5% and San Bernardino County level of 3.3%, has continued to decline each
year from a high of 13.7% in 2010.
Beginning in Fiscal Year 2018-19 and continuing through Fiscal Year 2019-20, the City began a Request for
Qualifications (RFQ) process to solicit interest from regional and national developers in the redevelopment of the
Carousel Mall property, a 43-acre property located in the historic heart of Downtown San Bernardino. The City
received a total of 11 submissions and is continuing to evaluate all options with the property, which has been identified
as the main catalyst for the future revitalization of Downtown San Bernardino.
For Fiscal Year 2019-20, the City’s General Fund budget totaled $129.39 million, which represented an increase of
$975 thousand, or 0.75%, from the original adopted budget for Fiscal Year 2018-19. In adopting the “status quo”
budget for Fiscal Year 2019-20 with no additional programs or services, the City remains focused on exploring new
avenues for revenue generation among rising costs.
Additional details regarding the City’s budget and its overall Fiscal Year 2019-20 Adopted Budget can be found on
the City’s website. Questions or requests for information regarding the Adopted Budget should be directed to the
Finance Department.
City of San Bernardino
Management’s Discussion and Analysis (Unaudited) (Continued)
For the Fiscal Year Ended June 30, 2019
17
Requests for Information
This financial report is designed to provide a general overview of the City's finances for all those with an interest in
the government's finances and to show the City’s accountability for the financial resources it receives. Questions
concerning any of the information provided in this report or requests for additional financial information should be
addressed to the Director of Finance, 290 North “D” Street, San Bernardino, California 92401.
18
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BASIC FINANCIAL STATEMENTS
19
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20
GOVERNMENT-WIDE FINANCIAL STATEMENTS
21
Governmental Business-Type
Activities Activities Total
ASSETS
Current assets:
Cash and investments 99,136,618$ 87,984,037$ 187,120,655$
Cash and investments with fiscal agents 73,416 - 73,416
Receivables:
Accounts, Net 9,430,727 9,917,034 19,347,761
Interest - 274,430 274,430
Due from other governments 9,945,435 371,422 10,316,857
Internal balances 3,129,146 (3,129,146) -
Inventory 189,990 1,884,565 2,074,555
Prepaid items 694,874 1,326,217 2,021,091
Total current assets 122,600,206 98,628,559 221,228,765
Noncurrent assets:
Notes receivable 313,971 - 313,971
Restricted cash - 59,948,377 59,948,377
Restricted investments - Consent Decree (Note 18)- 23,346,376 23,346,376
Restricted - other assets - 24,045,929 24,045,929
Property held for resale 64,341,692 - 64,341,692
Investment in joint ventures - 25,430,252 25,430,252
Non-depreciable capital assets 118,460,645 31,121,255 149,581,900
Depreciable capital assets, net 176,909,347 254,384,529 431,293,876
Intangible assets, being amortized, net 941,500 - 941,500
Total noncurrent assets 360,967,155 418,276,718 779,243,873
Total assets 483,567,361 516,905,277 1,000,472,638
DEFERRED OUTFLOWS OF RESOURCES
Pension-related deferred outflows of resources 45,181,346 5,636,517 50,817,863
OEPB-related deferred outflows of resources - 3,057,917 3,057,917
Total deferred outflows of resources 45,181,346 8,694,434 53,875,780
Primary Government
City of San Bernardino
June 30, 2019
Statement of Net Position
See accompanying Notes to the Basic Financial Statements.
22
Governmental Business-Type
Activities Activities Total
LIABILITIES
Current liabilities:
Accounts payable and accrued liabilities 8,829,033$ 5,690,994$ 14,520,027$
Payroll and related liabilities 3,101,539 1,428,919 4,530,458
Interest payable 222,319 1,479,688 1,702,007
Retentions payable 971,327 - 971,327
Unearned revenue 6,427,131 - 6,427,131
Deposits payable 398,202 498,062 896,264
Compensated absences - due within one year 1,565,333 1,102,497 2,667,830
Claims payable - due within one year 4,393,876 2,689,932 7,083,808
Long-term debt - due within one year 2,961,713 1,765,000 4,726,713
Total current liabilities 28,870,473 14,655,092 43,525,565
Noncurrent liabilities:
Deposits payable - 3,026,882 3,026,882
Unearned revenue - Consent Decree (Note 18)- 47,392,305 47,392,305
Due to Successor Agency 2,232,925 - 2,232,925
Aggregate net pension liability 358,483,820 56,856,346 415,340,166
Net OPEB liability - 14,377,581 14,377,581
Landfill closure liability - 6,150,136 6,150,136
Compensated absences - due in more than one year 3,652,442 277,952 3,930,394
Claims payable - due in more than one year 23,936,860 - 23,936,860
Long-term debt - due in more than one year 27,692,510 84,017,663 111,710,173
Total noncurrent liabilities 415,998,557 212,098,865 628,097,422
Total liabilities 444,869,030 226,753,957 671,622,987
DEFERRED INFLOWS OF RESOURCES
Pension-related deferred inflows of resources 5,828,212 778,901 6,607,113
OPEB-related deferred inflows of resources - 1,829,014 1,829,014
Total deferred inflows of resources 5,828,212 2,607,915 8,436,127
NET POSITION
Net investment in capital assets 286,878,015 259,671,498 546,549,513
Restricted:
Public safety 3,495,816 - 3,495,816
Streets and capital projects 19,748,430 - 19,748,430
Culture and recreation 925,424 - 925,424
Grants 992,218 - 992,218
Community development 35,889,008 - 35,889,008
Debt service 168,389 - 168,389
Capital projects 36,910,196 - 36,910,196
Capital related fees - 33,999,584 33,999,584
Total restricted 98,129,481 33,999,584 132,129,065
Unrestricted (deficit)(306,956,031) 2,566,757 (304,389,274)
Total net position 78,051,465$ 296,237,839$ 374,289,304$
Primary Government
City of San Bernardino
Statement of Net Position (Continued)
June 30, 2019
See accompanying Notes to the Basic Financial Statements.
23
Operating Capital Total
Charges for Grants and Grants and Program
Functions/Programs Expenses Services Contributions Contributions Revenues
Primary government:
Governmental activities:
General government 29,494,169$ 1,057,221$ 5,834,465$ -$ 6,891,686$
Public safety 98,603,681 7,770,680 2,520,605 - 10,291,285
Streets 44,613,103 6,158,572 13,104,290 270,819 19,533,681
Culture and recreation 3,712,899 1,416,584 - - 1,416,584
Community development 6,679,568 3,941,191 2,303,866 - 6,245,057
Community service 4,195,874 45,838 1,023,289 - 1,069,127
Interest on long-term debt 861,785 - - - -
Total governmental activities 188,161,079 20,390,086 24,786,515 270,819 45,447,420
Business-type activities:
Water 35,988,661 38,819,578 1,832,879 2,737,031 43,389,488
Sewer 27,787,317 29,849,642 - 7,092,785 36,942,427
Sewer Collection 8,172,922 7,555,960 - 291,528 7,847,488
Integrated Waste 777,167 500,242 - - 500,242
Total business-type activities 72,726,067 76,725,422 1,832,879 10,121,344 88,679,645
Total primary government 260,887,146$ 97,115,508$ 26,619,394$ 10,392,163$ 134,127,065$
Program Revenues
Statement of Activities and Changes in Net Position
City of San Bernardino
For the Year Ended June 30, 2019
See accompanying Notes to the Basic Financial Statements.
24
Governmental Business-Type
Functions/Programs Activities Activities Total
Primary government:
Governmental activities:
General government (22,602,483)$ -$ (22,602,483)$
Public safety (88,312,396) - (88,312,396)
Streets (25,079,422) - (25,079,422)
Culture and recreation (2,296,315) - (2,296,315)
Community development (434,511) - (434,511)
Community service (3,126,747) - (3,126,747)
Interest on long-term debt (861,785) - (861,785)
Total governmental activities (142,713,659) - (142,713,659)
Business-type activities:
Water - 7,400,827 7,400,827
Sewer - 9,155,110 9,155,110
Sewer Collection - (325,434) (325,434)
Integrated Waste - (276,925) (276,925)
Total business-type activities - 15,953,578 15,953,578
Total primary government (142,713,659) 15,953,578 (126,760,081)
General revenues:
Taxes:
Property taxes 17,101,369 - 17,101,369
Sales taxes 49,450,785 - 49,450,785
Franchise taxes 11,550,447 - 11,550,447
Utilities user taxes 22,924,522 - 22,924,522
Transient occupancy taxes 4,950,170 - 4,950,170
Other taxes 8,217,876 - 8,217,876
Total taxes 114,195,169 - 114,195,169
Investment earnings 3,864,707 3,112,261 6,976,968
Gain (loss) on disposal of assets 58,949 22,086 81,035
Miscellaneous 2,920,461 2,022,093 4,942,554
Subtotal 6,844,117 5,156,440 12,000,557
Capital contributions
Intragovernmental contributions - (8,375,074) (8,375,074)
Total capital contributions - (8,375,074) (8,375,074)
Total general revenues and contributions 121,039,286 (3,218,634) 117,820,652
Changes in net position (21,674,373) 12,734,944 (8,939,429)
Net Position - beginning of year, as restated (Note 16)99,725,838 283,502,895 383,228,733
Net Position - end of year 78,051,465$ 296,237,839$ 374,289,304$
City of San Bernardino
Statement of Activities and Changes in Net Position (Continued)
For the Year Ended June 30, 2019
Primary Government
and Changes in Net Position
Net (Expense) Revenue
See accompanying Notes to the Basic Financial Statements.
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26
FUND FINANCIAL STATEMENTS
27
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28
GOVERNMENTAL FUND
FINANCIAL STATEMENTS
General Fund – This is the primary operating fund of the City. It is used to account for all revenues and expenditures
that are not required to be accounted for in another fund.
Federal and State Grants Fund - This fund is used to report various grants awarded to the City by Federal, State, and
local governments not otherwise accounted for in the General Fund or Capital Projects funds. A detailed report by
program is available under a separate report meeting the criteria of Title 2 U.S.Code of Federal Regulations Part 200,
Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards , for all federal
grants received by the City.
29
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30
Federal and Other Total
General State Grants Governmental Governmental
Fund Fund Funds Funds
ASSETS
Cash and investments 26,691,742$ 2,959,081$ 63,592,269$ 93,243,092$
Receivables:
Accounts, Net 5,359,428 3,005,757 473,216 8,838,401
Notes - - 313,971 313,971
Due from other governments 8,049,623 - 1,895,812 9,945,435
Prepaid items 692,390 - - 692,390
Due from other funds 5,191,479 - - 5,191,479
Property held for resale 32,162,065 16,110,585 16,069,042 64,341,692
Restricted cash and investments held by fiscal agents 73,416 - - 73,416
Total assets 78,220,143$ 22,075,423$ 82,344,310$ 182,639,876$
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable 4,209,387$ 787,237$ 2,073,272$ 7,069,896$
Accrued liabilities 14,303 - - 14,303
Payroll and related liabilities 2,842,262 72,824 50,520 2,965,606
Retentions payable 642,221 77,896 251,210 971,327
Deposits payable 363,633 - 34,569 398,202
Unearned revenue 3,375,000 3,052,131 - 6,427,131
Due to Successor Agency 2,232,925 - - 2,232,925
Total liabilities 13,679,731 3,990,088 2,409,571 20,079,390
Fund Balances:
Nonspendable 32,855,157 - - 32,855,157
Restricted 73,416 18,085,335 79,970,730 98,129,481
Committed 68,387 - - 68,387
Unassigned 31,543,452 - (35,991) 31,507,461
Total fund balances 64,540,412 18,085,335 79,934,739 162,560,486
Total liabilities and fund balances 78,220,143$ 22,075,423$ 82,344,310$ 182,639,876$
(Concluded)
Major Funds
June 30, 2019
Governmental Funds
Balance Sheet
City of San Bernardino
See accompanying Notes to the Basic Financial Statements.
31
Total Fund Balances - Total Governmental Funds 162,560,486$
Amounts reported for governmental activities in the Statement of Net Position were different because:
Capital assets used in governmental activities were not financial resources and therefore were not reported in governmental
funds.
Government-Wide Financial Statements 296,311,492
Less: Internal Service Funds' capital assets (1,365,360)
Total capital assets adjustment 294,946,132
Interest payable on long-term debt did not require current financial resources. Therefore, interest payable was not reported as a
liability in Governmental Funds Balance Sheet.(222,319)
Long-term liabilities are not due and payable in the current period and therefore are not reported in the governmental funds.
Amount reported in Government-Wide Statement of Net Position:
Compensated absences - due within one year (1,565,333)
Compensated absences - due in more than one year (3,652,442)
Claims payable - due within one year (4,393,876)
Claims payable - due in more than one year (23,936,860)
Long-term debt - due within one year (2,961,713)
Long-term debt - due in more than one year (27,692,510)
Total reported in Government-Wide Statement of Net Position (64,202,734)
Less: amount reported in Internal Service Funds
Compensated absences - due within one year 65,720
Compensated absences - due in more than one year 153,348
Long-term debt - due within one year 626,883
Claims payable - due within one year 4,393,876
Claims payable - due in more than one year 23,936,860
Total reported in Internal Service Funds 29,176,687
Net long-term liabilities (35,026,047)
Aggregate net pension liability is not due and payable in the current period and therefore is not reported in the governmental
funds. This amount does not include the aggregate net pension liability in the Internal Service Funds in the amount of
$14,039,728.(344,444,092)
Actuarially determined pension deferred outflows of resources are reported in the government-wide statements but are not
reported in the governmental funds. This amount does not include the pension deferred outflows in the Internal Service Funds in
the amount of $1,292,299.43,889,047
Actuarially determined pension deferred inflows of resources are reported in the government-wide statements but are not
reported in the governmental funds. This amount does not include the pension deferred outflows in the Internal Service Funds in
the amount of $192,337.(5,635,875)
Internal service funds were used by management to charge the costs of certain activities to individual funds. The assets and
liabilities of the internal service funds were included in governmental activities in the Government-Wide Statement of Net
Position.(38,015,867)
Net Position of Governmental Activities 78,051,465$
City of San Bernardino
June 30, 2019
to the Government-Wide Statement of Net Position
Reconciliation of the Governmental Funds Balance Sheet
See accompanying Notes to the Basic Financial Statements.
32
Federal and Other Total
General State Grants Governmental Governmental
Fund Fund Funds Funds
REVENUES:
Taxes 105,604,698$ -$ 5,590,760$ 111,195,458$
Licenses and permits 11,567,573 - 738,116 12,305,689
Impact fees - - 1,858,064 1,858,064
Fines and forfeitures 2,281,190 - 456,060 2,737,250
Use of money and property 1,048,252 92,069 2,042,394 3,182,715
Lease revenue 1,099,730 - - 1,099,730
Intergovernmental 1,332,916 10,694,959 9,812,033 21,839,908
Charges for services 7,021,328 - 1,783,552 8,804,880
Other revenues 3,015,369 - - 3,015,369
Total revenues 132,971,056 10,787,028 22,280,979 166,039,063
EXPENDITURES:
Current:
General government 22,905,192 184,989 454,064 23,544,245
Public safety 81,553,652 2,169,371 814,616 84,537,639
Streets 24,119,892 4,788,504 11,680,173 40,588,569
Culture and recreation 3,424,819 281 - 3,425,100
Community development 4,015,206 1,731,260 9,958 5,756,424
Community service 2,454,631 971,073 347,545 3,773,249
Debt service:
Principal 1,517,120 454,000 - 1,971,120
Interest and fiscal charges 589,633 282,867 - 872,500
Total expenditures 140,580,145 10,582,345 13,306,356 164,468,846
REVENUES OVER
(UNDER) EXPENDITURES (7,609,089) 204,683 8,974,623 1,570,217
OTHER FINANCING SOURCES (USES):
Loss on sale of property held for resale - - (882,637) (882,637)
Proceeds from sale of capital assets 58,949 - - 58,949
Transfers in - - 1,491,125 1,491,125
Transfers out - - (1,491,125) (1,491,125)
Total other financing sources (uses)58,949 - (882,637) (823,688)
CHANGES IN FUND BALANCES (7,550,140) 204,683 8,091,986 746,529
FUND BALANCES:
Beginning of year, as restated (Note 16) 72,090,552 17,880,652 71,842,753 161,813,957
End of year 64,540,412$ 18,085,335$ 79,934,739$ 162,560,486$
(Concluded)
Major Funds
For the Year Ended June 30, 2019
Governmental Funds
Statement of Revenues, Expenditures, and Changes in Fund Balances
City of San Bernardino
See accompanying Notes to the Basic Financial Statements.
33
Net Change in Fund Balances - Total Governmental Funds 746,529$
Amounts reported for governmental activities in the Statement of Activities were different because:
Governmental funds reported capital asset acquisitions as expenditures. However, in the Government-Wide Statement of
Activities and Changes in Net Position, the cost of those assets was allocated over their estimated useful lives as
depreciation expense. This was the amount of capital assets recorded in the current period. This amount did not include
acquisitions for Internal Service Funds in the amount of $74,752.10,386,763
Depreciation expense on capital assets was reported in the Government-Wide Statement of Activities and Changes in Net
Position, but they did not require the use of current financial resources. Therefore, depreciation expense was not reported as
expenditures in the Governmental Funds. This amount did not include the depreciation or amortization expense for Internal
Service Funds in the amounts of $151,319 and $594,633, respectively. (16,013,521)
Repayment of long-term liabilities was an expenditures in governmental funds, but the repayment reduced long-term
liabilities in the Government-Wide Statement of Net Position. This amount did not include principal payments in the
internal service fund of $609,275
Principal payment of long-term debt 1,971,120
Some expenses reported in the statement of activities do not require the use of current financial resources and therefore are
not reported as expenditures in governmental funds. This amount did not include the changes in compensated absences for
Internal Service Funds in the amount of $29,086.
Changes in compensated absences (327,239)
Changes in net pension liability reported in the Statement of Activities does not require the use of current financial
resources and, therefore, is not reported as an expenditure in governmental funds.6,051,659
The net effect of various miscellaneous transactions involving pension plans (i.e. deferred inflow/outflow amortization,
contributions after measurement date) increased Net Position. (24,151,545)
Interest expense on long-term debt was reported in the Government-Wide Statement of Activities and Changes in Net
Position, but it did not require the use of current financial resources. This amount represented the change in accrued interest
from prior year.24,314
Internal service funds were used by management to charge the costs of certain activities to individual funds. The net
revenue of internal service funds was reported with governmental activities.(362,453)
Change in Net Position of Governmental Activities (21,674,373)$
City of San Bernardino
For the Year Ended June 30, 2019
in Fund Balances to the Government-Wide Statement of Activities and Changes in Net Position
Reconciliation of the Governmental Statement of Revenues, Expenditures, and Changes
See accompanying Notes to the Basic Financial Statements.
34
PROPRIETARY FUND
FINANCIAL STATEMENTS
Water Fund – This fund is used to account for the provision of water services to the residential, commercial, and
industrial segments of the City. All activities necessary to provide such services are accounted for in this fund, including,
but not limited to, administration, operations, maintenance, financing and related debt service, and billing and collection.
p ,
commercial, and industrial segments of the City. All activities necessary to provide such services are accounted for in
this fund, including, but not limited to, administration, operations, maintenance, financing and related debt service, and
billing and collection.
Sewer Collection Fund – This fund is used to account for the provision of wastewater collection to the residential,
commercial, and industrial segments of the City. All activities necessary to provide such services are accounted for in
this fund, including, but not limited to, administration, operations, maintenance, financing and related debt service, and
billing and collection.
Integrated Waste Fund – This fund is used to account for the provision of refuse collection to the residential,
commercial, and industrial segments of the City. All activities necessary to provide such services are accounted for in
this fund, including, but not limited to, administration, operations, maintenance, financing and related debt service, and
billing and collection. Effective April 1, 2016, the City provides refuse services through an outside contractor.
35
Sewer
Water Sewer Collection
ASSETS
Current assets:
Cash and cash equivalents 20,948,690$ 37,434,557$ 22,663,480$
Accounts receivable, net 5,380,201 3,564,238 847,532
Interest receivable 79,277 144,052 51,101
Due from other governments 12,622 358,800 -
Due from other funds - - -
Inventories 1,884,565 - -
Current portion of prepaid items 673,088 618,712 34,417
Total current assets 28,978,443 42,120,359 23,596,530
Noncurrent assets:
Restricted assets:
Cash and cash equivalents - capital-related fees 27,686,184 32,262,193 -
Investments - Consent Decree 23,346,376 - -
Interest receivable - Consent Decree 91,521 - -
Prepaid insurance - Consent Decree 23,954,408 - -
Advances to other fund - - -
Investments in joint ventures - 25,430,252 -
Non-depreciable capital assets 10,861,266 18,835,144 1,424,845
Depreciable capital assets, net 190,673,195 45,866,249 17,845,085
Total capital assets, net 201,534,461 64,701,393 19,269,930
Total noncurrent assets 276,612,950 122,393,838 19,269,930
Total assets 305,591,393 164,514,197 42,866,460
DEFERRED OUTFLOWS OF RESOURCES
Pension-related deferred outflows of resources 2,798,504 2,108,488 729,525
OPEB-related deferred outflows of resources 1,871,854 944,136 241,927
Total deferred outflows of resources 4,670,358 3,052,624 971,452
June 30, 2019
Proprietary Funds
Major Enterprise Funds
Statement of Net Position
City of San Bernardino
See accompanying Notes to the Basic Financial Statements.
36
Sewer
Water Sewer Collection
LIABILITIES
Current liabilities:
Accounts payable and accrued liabilities 2,732,141 890,435 2,024,507
Payroll and related liabilities 732,503 515,302 173,271
Due to other funds 2,547,991 - 2,291,155
Interest payable 908,536 571,152 -
Deposits payable 498,062 - -
Compensated absences - due within one year 793,779 290,871 16,729
Claims payable - due within one year 1,883,552 666,160 140,220
Long term debt - due within one year 830,000 935,000 -
Total current liabilities 10,926,564 3,868,920 4,645,882
Noncurrent liabilities:
Deposits payable 3,026,882 - -
Advances from other fund - - -
Unearned revenue - Consent Decree 47,392,305 - -
Aggregate net pension liability 28,228,907 21,268,618 7,358,821
Net OPEB liability - due in more than one year 7,188,944 5,319,591 1,869,046
Landfill closure liability - due in more than one year - - -
Compensated absences - due in more than one year 198,444 72,718 4,182
Claims payable - due in more than one year - - -
Long term debt - due in more than one year 51,232,110 32,785,553 -
Total noncurrent liabilities 137,267,592 59,446,480 9,232,049
Total liabilities 148,194,156 63,315,400 13,877,931
DEFERRED INFLOWS OF RESOURCES
Pension-related deferred inflows of resources 386,721 291,368 100,812
OPEB-related deferred inflows of resources 914,507 676,735 237,772
Total deferred inflows of resources 1,301,228 968,103 338,584
Net Position (Deficit):
Net investment in capital assets 177,158,535 63,243,033 19,269,930
Restricted (16,392,168) 40,040,285 10,351,467
Unrestricted (deficit)- - -
Total net position (deficit)160,766,367$ 103,283,318$ 29,621,397$
Major Enterprise Funds
June 30, 2019
Proprietary Funds
Statement of Net Position (Continued)
City of San Bernardino
See accompanying Notes to the Basic Financial Statements.
37
Governmental
Activities
Integrated Internal
Waste Total Service Funds
ASSETS
Current assets:
Cash and cash equivalents 6,937,310$ 87,984,037$ 5,893,526$
Accounts receivable, net 125,063 9,917,034 592,326
Interest receivable - 274,430 -
Due from other governments - 371,422 -
Due from other funds - - 2,176,676
Inventories - 1,884,565 189,990
Current portion of prepaid items - 1,326,217 2,484
Total current assets 7,062,373 101,757,705 8,855,002
Noncurrent assets:
Restricted assets:
Cash and cash equivalents - capital-related fees - 59,948,377 -
Investments - Consent Decree - 23,346,376 -
Interest receivable - Consent Decree - 91,521 -
Prepaid insurance - Consent Decree - 23,954,408 -
Advances to other fund 1,710,000 1,710,000 -
Investments in joint ventures - 25,430,252 -
Non-depreciable capital assets - 31,121,255 -
Depreciable capital assets, net - 254,384,529 1,365,360
Total capital assets, net - 285,505,784 1,365,360
Total noncurrent assets 1,710,000 419,986,718 1,365,360
Total assets 8,772,373 521,744,423 10,220,362
DEFERRED OUTFLOWS OF RESOURCES
Pension-related deferred outflows of resources - 5,636,517 1,292,299
OPEB-related deferred outflows of resources - 3,057,917 -
Total deferred outflows of resources - 8,694,434 1,292,299
Major Enterprise
Funds
June 30, 2019
Proprietary Funds
Statement of Net Position (Continued)
City of San Bernardino
See accompanying Notes to the Basic Financial Statements.
38
Governmental
Activities
Integrated Internal
Waste Total Service Funds
LIABILITIES
Current liabilities:
Accounts payable and accrued liabilities 43,911 5,690,994 1,744,834
Payroll and related liabilities 7,843 1,428,919 135,933
Due to other funds - 4,839,146 2,529,009
Interest payable - 1,479,688 -
Deposits payable - 498,062 -
Compensated absences - due within one year 1,118 1,102,497 65,720
Claims payable - due within one year - 2,689,932 4,393,876
Long term debt - due within one year - 1,765,000 626,883
Total current liabilities 52,872 19,494,238 9,496,255
Noncurrent liabilities:
Deposits payable - 3,026,882 -
Advances from other fund - - 1,710,000
Unearned revenue - Consent Decree - 47,392,305 -
Aggregate net pension liability - 56,856,346 14,039,728
Net OPEB liability - due in more than one year - 14,377,581 -
Landfill closure liability - due in more than one year 6,150,136 6,150,136 -
Compensated absences - due in more than one year 2,608 277,952 153,348
Claims payable - due in more than one year - - 23,936,860
Long term debt - due in more than one year - 84,017,663 -
Total noncurrent liabilities 6,152,744 212,098,865 39,839,936
Total liabilities 6,205,616 231,593,103 49,336,191
DEFERRED INFLOWS OF RESOURCES
Pension-related deferred inflows of resources - 778,901 192,337
OPEB-related deferred inflows of resources - 1,829,014 -
Total deferred inflows of resources - 2,607,915 192,337
Net Position (Deficit):
Net investment in capital assets - 259,671,498 738,477
Restricted - 33,999,584 -
Unrestricted (deficit) 2,566,757 2,566,757 (38,754,344)
Total net position (deficit)2,566,757$ 296,237,839$ (38,015,867)$
Major Enterprise
Funds
June 30, 2019
Proprietary Funds
Statement of Net Position (Continued)
City of San Bernardino
See accompanying Notes to the Basic Financial Statements.
39
Sewer
Water Sewer Collection
OPERATING REVENUES:
Charges for services 38,819,578$ 29,849,642$ 7,555,960$
Other operating revenues 280,382 696,539 6,137
Total operating revenues 39,099,960 30,546,181 7,562,097
OPERATING EXPENSES:
Cost of sales and services - - -
Administration and customer service 5,312,470 3,436,525 1,448,598
Utility administration 2,619,347 348,052 159,476
Plant operations 8,015,317 9,343,882 439,660
Maintenance 2,387,889 3,041,620 -
Environmental control - 774,625 -
Distribution 4,838,083 - -
Engineering and water quality control 2,253,371 617,855 5,051,772
General, administration and overhead 2,055,691 2,990,975 -
Claims expense - - -
Amortization - - -
Depreciation 6,512,869 4,313,147 1,073,416
Total operating expenses 33,995,037 24,866,681 8,172,922
OPERATING INCOME (LOSS)5,104,923 5,679,500 (610,825)
NONOPERATING REVENUES (EXPENSES):
Investment income 903,401 1,361,935 584,690
Rental income 206,360 - -
Noncapital grants 1,832,879 - -
Interest expense and fiscal charges (1,993,624) (1,553,261) -
Loss on joint venture - RIX - (1,367,375) -
Contributions to other agencies - (8,375,074) -
Miscellaneous income - - -
Gain on disposal of assets 12,669 9,417 -
Other 867,763 (42,951) -
Total nonoperating revenues (expenses)1,829,448 (9,967,309) 584,690
INCOME (LOSS) BEFORE CAPITAL CONTRIBUTIONS 6,934,371 (4,287,809) (26,135)
CAPITAL CONTRIBUTIONS
Acquisition fees 830,760 - -
Capital contributions 1,139,828 254,520 -
Capacity fees 746,603 1,067,143 291,528
EPA grants 19,840 - -
Other capital - 5,771,122 -
Total contributions 2,737,031 7,092,785 291,528
CHANGES IN NET POSITION 9,671,402 2,804,976 265,393
NET POSITION:
Beginning of year 151,094,965 100,478,342 29,356,004
End of year 160,766,367$ 103,283,318$ 29,621,397$
For the Year Ended June 30, 2019
Proprietary Funds
Statement of Revenues, Expenses, and Changes in Net Position
City of San Bernardino
Major Enterprise Funds
See accompanying Notes to the Basic Financial Statements.
40
Governmental
Activities
Integrated Internal
Waste Total Service Funds
OPERATING REVENUES:
Charges for services 500,242$ 76,725,422$ 16,885,416$
Other operating revenues - 983,058 1,003,542
Total operating revenues 500,242 77,708,480 17,888,958
OPERATING EXPENSES:
Cost of sales and services 777,167 777,167 12,167,999
Administration and customer service - 10,197,593 -
Utility administration - 3,126,875 -
Plant operations - 17,798,859 -
Maintenance - 5,429,509 -
Environmental control - 774,625 -
Distribution - 4,838,083 -
Engineering and water quality control - 7,922,998 -
General, administration and overhead - 5,046,666 -
Claims expense - - 5,712,556
Amortization - - 594,633
Depreciation - 11,899,432 151,319
Total operating expenses 777,167 67,811,807 18,626,507
OPERATING INCOME (LOSS)(276,925) 9,896,673 (737,549)
NONOPERATING REVENUES (EXPENSES):
Investment income 262,235 3,112,261 -
Rental income - 206,360 -
Noncapital grants - 1,832,879 -
Interest expense and fiscal charges - (3,546,885) (13,598)
Loss on joint venture - RIX - (1,367,375) -
Contributions from City - (8,375,074) -
Miscellaneous income 7,863 7,863 388,694
Gain on disposal of assets - 22,086 -
Other - 824,812 -
Total nonoperating revenues (expenses)270,098 (7,283,073) 375,096
INCOME (LOSS) BEFORE CAPITAL CONTRIBUTIONS (6,827) 2,613,600 (362,453)
CAPITAL CONTRIBUTIONS
Acquisition fees - 830,760 -
Capital contributions - 1,394,348 -
Capacity fees - 2,105,274 -
EPA grants - 19,840 -
Other capital - 5,771,122 -
Total contributions - 10,121,344 -
CHANGES IN NET POSITION (6,827) 12,734,944 (362,453)
NET POSITION:
Beginning of year 2,573,584 283,502,895 (37,653,414)
End of year 2,566,757$ 296,237,839$ (38,015,867)$
For the Year Ended June 30, 2019
Proprietary Funds
Statement of Revenues, Expenses, and Changes in Net Position (Continued)
City of San Bernardino
Major Enterprise
Funds
See accompanying Notes to the Basic Financial Statements.
41
Sewer
Water Sewer Collection
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers 38,968,123$ 30,539,993$ 7,555,792$
Cash received from user departments - - -
Cash payments to suppliers for goods and services (17,412,566) (13,923,030) 934,297
Cash payments to employees for services (9,683,703) (7,453,250) (2,334,247)
Cash payments for claims and insurance - - -
Cash paid to RIX joint venture for operations - (106,886) -
Cash inflows (outflows) from other activities - - -
Net cash provided by (used in) operating activities 11,871,854 9,056,827 6,155,842
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:
Acquisition of capital assets (10,926,792) (1,566,601) (2,494,523)
Capital fees received 1,577,363 1,067,143 291,529
Proceeds from disposal of assets 78,739 9,418 -
Rental income 206,360 - -
Principal paid on capital-related debt (795,000) (910,000) -
Interest paid on capital-related debt (2,197,887) (1,367,679) -
Capital grant proceeds 19,840 - -
Net cash (used in) capital and related
financing activities (12,037,377) (2,767,719) (2,202,994)
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Interfund (lending) borrowing - - -
Other non-operating revenues (expenses) 867,763 (42,951) -
Cash paid to RIX joint venture - (8,375,074) -
Consent Decree insurance drawdowns 2,955,012 - -
Net cash provided by (used in) noncapital financing activities 3,822,775 (8,418,025) -
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment income 886,958 1,338,441 578,386
Net cash provided (used) by investing activities 886,958 1,338,441 578,386
Net change in cash and cash equivalents 4,544,210 (790,476) 4,531,234
CASH AND CASH EQUIVALENTS:
Beginning of year 37,366,339 51,230,302 7,368,173
End of year 41,910,549$ 50,439,826$ 11,899,407$
RECONCILIATION TO STATEMENT OF NET POSITION:
Cash and cash equivalents 20,948,690$ 37,434,557$ 22,663,480$
Restricted cash and cash equivalents 27,686,184 32,262,193 -
Less those not meeting the definition of a cash equivalent (Note 1) (6,724,325) (19,256,924) (10,764,073)
Total cash and cash equivalents 41,910,549$ 50,439,826$ 11,899,407$
City of San Bernardino
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2019
Major Enterprise Funds
See accompanying Notes to the Basic Financial Statements.
42
Sewer
Water Sewer Collection
RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH
PROVIDED BY (USED IN) OPERATING ACTIVITIES:
Operating income (loss) 5,104,923$ 5,679,500$ (610,825)$
Adjustments to reconcile operating income (loss) to net cash
provided by (used in) operating activities:
Depreciation and amortization 6,512,869 4,313,147 1,073,416
Changes in operating assets and liabilities:
Accounts receivable (117,347) 65,743 (6,305)
Due from other governments (26,517) (71,931) -
Inventories (87,018) - -
Prepaids 1,206,319 77,033 9,692
Due from other funds - - -
RIX Joint Venture - (106,886) -
Pension-related deferred outflows 4,294,299 3,798,246 271,533
OPEB-related deferred outflows (72,740) (69,861) (241,927)
Accounts payable and accrued liabilities (337,922) (3,886) 1,583,630
Accrued payroll and related liabilities (575,015) (85,877) 1,624,565
Due to other funds - - -
Deposits payable 12,027 - -
Landfill closure liability - - -
Aggregate net pension liability (4,816,884) (5,569,656) 3,680,842
Aggregate net OPEB liability 845,156 1,294,228 648,477
Compensated absences 138,114 (1,354) (252)
Claims and judgments payable (59,558) (110,195) (27,292)
Pension-related deferred inflows (627,209) (471,309) (2,087,484)
OPEB-related deferred inflows 478,357 319,885 237,772
Total adjustments 6,766,931 3,377,327 6,766,667
Net cash provided by (used in) operating activities 11,871,854$ 9,056,827$ 6,155,842$
NON-CASH FROM CAPITAL AND RELATED FINANCING ACTIVITIES
Capital contributions 1,408,096$ -$ -$
Non-cash from capital and related financing activities 1,408,096$ -$ -$
City of San Bernardino
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2019
Major Enterprise Funds
See accompanying Notes to the Basic Financial Statements.
43
Governmental
Activities
Integrated Internal
Waste Total Service Funds
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers 375,242$ 77,439,150$ -$
Cash received from user departments - - 16,197,562
Cash payments to suppliers for goods and services (1,429,791) (31,831,090) (9,516,187)
Cash payments to employees for services - (19,471,200) -
Cash payments for claims and insurance - - (5,516,767)
Cash paid to RIX joint venture for operations - (106,886) -
Cash inflows (outflows) from other activities 97,843 97,843 1,003,542
Net cash provided by (used in) operating activities (956,706) 26,127,817 2,168,150
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:
Acquisition of capital assets - (14,987,916) (74,752)
Capital fees received - 2,936,035 -
Proceeds from disposal of assets - 88,157 -
Rental income - 206,360 -
Principal paid on capital-related debt - (1,705,000) (609,275)
Interest paid on capital-related debt - (3,565,566) (13,598)
Capital grant proceeds - 19,840 -
Net cash (used in) capital and related
financing activities - (17,008,090) (697,625)
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Interfund (lending) borrowing (1,710,000) (1,710,000) 1,710,000
Other non-operating revenues (expenses) 7,863 832,675 388,694
Cash paid to RIX joint venture - (8,375,074) -
Consent Decree insurance drawdowns - 2,955,012 -
Net cash provided by (used in) noncapital financing activities (1,702,137) (6,297,387) 2,098,694
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment income 262,235 3,066,020 -
Net cash provided (used) by investing activities 262,235 3,066,020 -
Net change in cash and cash equivalents (2,396,608) 5,888,360 3,569,219
CASH AND CASH EQUIVALENTS:
Beginning of year 9,333,918 105,298,732 2,324,307
End of year 6,937,310$ 111,187,092$ 5,893,526$
RECONCILIATION TO STATEMENT OF NET POSITION:
Cash and cash equivalents 6,937,310$ 87,984,037$ 5,893,526$
Restricted cash and cash equivalents - 59,948,377 -
Less those not meeting the definition of a cash equivalent (Note 1) - (36,745,322) -
Total cash and cash equivalents 6,937,310$ 111,187,092$ 5,893,526$
Major Enterprise
Funds
City of San Bernardino
Statement of Cash Flows (Continued)
Proprietary Funds
For the Year Ended June 30, 2019
See accompanying Notes to the Basic Financial Statements.
44
Governmental
Activities
Integrated Internal
Waste Total Service Funds
RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH
PROVIDED BY (USED IN) OPERATING ACTIVITIES:
Operating income (loss) (276,925)$ 9,896,673$ (737,549)$
Adjustments to reconcile operating income (loss) to net cash
provided by (used in) operating activities:
Depreciation and amortization - 11,899,432 745,952
Changes in operating assets and liabilities:
Accounts receivable (125,000) (182,909) (557,371)
Due from other governments 97,843 (605) -
Inventories - (87,018) (7,817)
Prepaids - 1,293,044 (1,409)
Due from other funds - - 85,635
RIX Joint Venture - (106,886) -
Pension-related deferred outflows - 8,364,078 1,517,075
OPEB-related deferred outflows - (384,528) -
Accounts payable and accrued liabilities (391,621) 850,201 1,298,158
Accrued payroll and related liabilities (5,007) 958,666 26,661
Due to other funds - - (216,118)
Deposits payable - 12,027 -
Landfill closure liability (255,231) (255,231) -
Aggregate net pension liability - (6,705,698) 60,247
Aggregate net OPEB liability - 2,787,861 -
Compensated absences (765) 135,743 29,086
Claims and judgments payable - (197,045) 195,789
Pension-related deferred inflows - (3,186,002) -
OPEB-related deferred inflows - 1,036,014 (270,189)
Total adjustments (679,781) 16,231,144 2,905,699
Net cash provided by (used in) operating activities (956,706)$ 26,127,817$ 2,168,150$
NON-CASH FROM CAPITAL AND RELATED FINANCING ACTIVITIES
Contributions of capital assets from governmental activities -$ 1,408,096$ -$
Non-cash from capital and related financing activities -$ 1,408,096$ -$
City of San Bernardino
Major Enterprise
Funds
For the Year Ended June 30, 2019
Proprietary Funds
Statement of Cash Flows (Continued)
See accompanying Notes to the Basic Financial Statements.
45
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46
FIDUCIARY FUND
FINANCIAL STATEMENTS
Agency Funds – These funds are used to account for money and property held by the City as trustee or custodian. Such
funds include Special Deposits, Cemetery Perpetual Care, San Bernardino Regional Water Resource Authority, and
Successor Agency to the San Bernardino Economic Development Agency Private Purpose Trust Fund – This fund
is used to account for monies received from the San Bernardino County Auditor-Controller for the repayment of the
enforceable obligations of the former San Bernardino Economic Development Agency. These funds are restricted for
the sole purpose of payment of items on an approved Recognized Payment Obligation Schedule (ROPS).
47
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48
Successor Agency
To the Economic
Development
Agency
of San Bernardino
Agency Private-purpose
Funds Trust Fund
ASSETS
Cash and investments 6,668,865$ 17,252,404$
Cash and investments with fiscal agents - 18,676,896
Receivables:
Accounts 22,784 145,956
Interest 446,959 -
Due from City - 2,232,925
Prepaids - 510,576
Property held for resale - 9,306,483
Total assets 7,138,608$ 48,125,240
DEFERRED OUTFLOWS OF RESOURCES
Pension-related deferred outflows of resources 1,139,802
Deferred loss on refunding of bonds 1,415,605
Total deferred outflows of resources 2,555,407
LIABILITIES
Accounts payable 351,896$ 179,343
Accrued liabilities - 4,536
Retentions payable - 145,956
Deposits payable 6,639,079 4,532
Interest payable - 857,310
Due to bondholders 147,633 -
Compensated absences - 112,710
Aggregate net pension liability - 6,269,392
Long-term debt - 78,840,355
Total liabilities 7,138,608$ 86,414,134
DEFERRED INFLOWS OF RESOURCES
Pension-related deferred inflows of resources 584,924
Total deferred inflows of resources 584,924
NET POSITION (DEFICIT)
Held in trust (36,318,411)
Total net position (deficit)(36,318,411)$
City of San Bernardino
June 30, 2019
Fiduciary Funds
Statement of Fiduciary Net Position
See accompanying Notes to the Basic Financial Statements.
49
Successor Agency
to the Economic
Development
Agency
of San Bernardino
Private-purpose
Trust Fund
ADDITIONS:
Property taxes 16,280,136$
Investment income 592,556
Other revenues 317,621
Total additions 17,190,313
DEDUCTIONS:
Redevelopment 1,487,811
Debt service - interest and fiscal charges 4,099,990
Loss on disposition of capital assets 619,475
Total deductions 6,207,276
Changes in Net Position 10,983,037
NET POSITION:
Beginning of period, as restated (Note 16)(47,301,448)
End of period (36,318,411)$
City of San Bernardino
For the Year Ended June 30, 2019
Fiduciary Funds
Statement of Changes in Fiduciary Net Position
See accompanying Notes to the Basic Financial Statements.
50
51
NOTES TO THE BASIC FINANCIAL STATEMENTS
52
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City of San Bernardino
Index of Notes to the Basic Financial Statements
For the Year Ended June 30, 2019
53
NOTE DESCRIPTION PAGE
1 Summary of Significant Accounting Policies 55
2 Cash and Investments 70
3 Notes Receivables 75
4 Interfund Receivables, Payables, and Transfers 76
5 Property Held for Resale 77
6 Capital Assets 77
7 Long-Term Liabilities 79
8 Compensated Absences 95
9 Claims and Judgements Payable 97
10 Pension Plans 99
11 Other Postemployment Benefits 117
12 Other Required Disclosures 122
13 Fund Balance Classification 123
14 Net Investments in Capital Assets 123
15 Landfill Closure Liability 124
16 Prior Period Adjustments 124
17 Successor Agency Trust for Assets of Former Redevelopment Agency 125
18 Consent Decree 127
19 Jointly Governed Organizations and Joint Ventures 128
20 Commitments and Contingencies 129
54
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City of San Bernardino
Notes to the Basic Financial Statements
For the Fiscal Year Ended June 30, 2019
55
Note 1 – Summary of Significant Accounting Policies
The basic financial statements of the City of San Bernardino, California (City) have been prepared in conformity with
Generally Accepted Accounting Principles of the United States of America (U.S. GAAP) as applied to governmental
agencies. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for establishing
governmental accounting and financial reporting standards in the United States. The more significant of the City’s
accounting policies are described below.
A. Financial Reporting Entity
The City was incorporated on April 13, 1854, as a Charter City. The City operates under a Council-Manager form
of government and provides the following services: public safety (police), highways and streets, health and social
services, culture-recreation, public improvements, community development (planning, building and zoning), public
utilities (water and sewage), and general administrative services. In addition, the City operates the San Bernardino
Municipal Water Department (including Water, Sewer, and Sewer Collection Enterprise Funds).
In evaluating how to define the City for financial reporting purposes, management has considered all potential
component units. The primary criteria for including a potential component unit within the reporting entity are the
governing body’s financial accountability and a financial benefit or burden relationship and whether it is misleading
to exclude. A primary government is financially accountable and shares a financial benefit or burden relationship
if it appoints a voting majority of an organization’s governing body and it is able to impose its will on the
organization, or if there is a potential for the organization to provide specific financial benefits to, or impose specific
financial burdens on the primary government. A primary government may also be financially account able if an
organization is fiscally dependent on the primary government regardless of whether the organization has a
separately elected governing board, a governing board appointed by a higher level of government, or a jointly
appointed board, and there is a potential for the organization to provide specific financial benefits to, or impose
specific financial burdens on the primary government.
Blended Component Units
The financial reporting entity consists of the primary government, the City, and its component units. Component
units are legally separate entities for which the elected officials of the primary government are financially
accountable. In addition, component units can be other organizations for which the primary government is
accountable and their exclusion would cause the reporting entity’s financial statements to be misleading or
incomplete.
Blended component units, although legally separate entities, are, in substance part of the government’s operation
and so data from these units are combined with data of the primary government. Discretely presented component
units, on the other hand, are reported in a separate column in the combined financial statements to emphasize that
they are legally separate from the government.
Although the following are legally separate from the City, they have been “blended” as though they are part of the
City because the component unit’s governing body is substantially the same as the City’s and there is a financial
benefit or burden relationship between the City and the component unit; management of the City has operational
responsibilities for the component units; and/or the component units provide services entirely, or almost entirely,
to the City or otherwise exclusively, or almost exclusively, benefits the City , even though it does not provide
services directly to it.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
56
Note 1 – Summary of Significant Accounting Policies (Continued)
A. Financial Reporting Entity (Continued)
San Bernardino Municipal Water Department (SBMWD)
The San Bernardino Municipal Water Department and the Board of Water Commissioners ("Board") were
established on May 8th, 1905 by the Mayor and Common Council of San Bernardino in accordance with the
provisions specified in the City charter. The board is appointed by the Mayor and approved by City Council, has
Charter defined powers, with full authority for administration of the water utility and delegated authority for the
sewer treatment utility. The Board assembled for the first time on May 16th, 1905 to meet the water supply needs
of the community by providing trusted, quality service to our customers. This service has grown through the years
to include: water supply, water reclamation, geothermal heating supply, sewer collection and administrative support
for our growing citizens. On April 1, 2017 the City transferred operational management and the related assets of
the sewer collection system to SBMWD. Separately issued financial reports are available for SBMWD. These
reports may be obtained by contacting SBMWD, 1350 South E Street, San Bernardino, CA 92408.
Affordable Housing Solutions of San Bernardino, Inc. (AHS)
On December 16, 2009, the Economic Development Agency (EDA) acquired the Global Mobile Home Park
Corporation, a not-for-profit corporation (501(c)(3)), from the Redevelopment Agency of the City of Pomona for
the redevelopment purposes of the EDA as authorized by Resolution 2009-16 of the Community Development
Commission of the City of San Bernardino on May 4, 2009, and approved on May 5, 2009. The Mayor and Common
Council of the City of San Bernardino serve ex officio as the chairperson and members of the Community
Development Commission of the City of San Bernardino, respectively. On September 23, 2009, the Corporation
amended its Articles of Incorporation to rename the Corporation the “Affordable Housing Solutions of San
Bernardino Inc.” (AHS), which was endorsed and filed in the office of the Secretary of State of the State of
California on October 9, 2009. AHS is not currently active and has no assets.
San Bernardino Joint Powers Financing Authority (Authority)
The San Bernardino Joint Powers Financing Authority (Authority) was established pursuant to a Joint Exercise of
Powers Agreement dated August 21, 1989, by and between the City and the EDA. The EDA was dissolved during
fiscal year 2012 and the Successor Agency to the San Bernardino EDA is now a member of the JPFA along with
the City. The Authority was created for the purpose of providing financing for redevelopment activities for the City,
the EDA, or other local agencies in the State of California, the acquisition, construction or installation by the
Authority of public capital improvements and/or the purchase by the Authority of public obligations within the
meaning of the Marks-Roos Act. The Authority is authorized pursuant to the Marks-Roos Act to borrow money for
the purpose of financing the acquisition of bonds, notes and other obligations of, or for the purpose of making loans
to, the City, the EDA, or such other local agencies to provide financing for redevelopment activities of the City or
the EDA. The Authority is governed by a board composed of the City's elected officials. There are no separate
financial statements issued for the Authority.
B. Basis of Presentation, Accounting and Measurement Focus
The accounts of the City are organized on the basis of funds, each of which is considered a separate accounting
entity. The operations of each fund are accounted for by providing a separate set of self-balancing accounts that
comprise its assets, liabilities, fund equity, revenues and expenditures or expenses, as appropriate. Fund accounting
segregates funds according to their intended purpose and is used to aid management in demonstrating compliance
with finance-related legal and contractual provisions. The minimum number of funds is maintained in accordance
with legal and managerial requirements.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
57
Note 1 – Summary of Significant Accounting Policies (Continued)
B. Basis of Presentation, Accounting and Measurement Focus (Continued)
Government-Wide Financial Statements
The City’s Government-Wide Financial Statements include a Statement of Net Position and a Statement of
Activities and Changes in Net Position. These statements present summaries of governmental and business-type
activities for the City accompanied by a total column. Fiduciary activities of the City are not included in these
statements.
These financial statements are presented on an “economic resources” measurement focus and the accrual basis of
accounting. Accordingly, all of the City’s assets and liabilities, including capital assets, as well as infrastructure
assets, and long-term liabilities, are included in the accompanying Statement of Net Position. The Statement of
Activities presents changes in Net Position. Under the accrual basis of accounting, revenues are recognized in the
period in which they are earned while expenses are recognized in the period in which the liability is incurred. Under
the accrual basis of accounting, revenues, expenses, gains, losses, assets, deferred outflows of resources, liabilities
and deferred inflows of resources resulting from exchange and exchange-like transactions are recognized when the
exchange takes place. Revenues, expenses, gains, losses, assets, deferred outflows of resources, liabilities and
deferred inflows of resources resulting from non-exchange transactions are recognized in accordance with the
requirements of U.S. GAAP.
Program revenues include charges for services, special assessments, and payments made by parties outside of the
reporting government's citizenry if that money is restricted to a particular program. Program revenues are netted
with program expenses in the statement of activities to present the net cost of each program. Program revenues for
the City are classified in three categories:
➢ Charges for services
➢ Operating grants and contributions
➢ Capital grants and contributions
Certain eliminations have been made in regards to interfund activities, payables and receivables. All internal
balances in the Statement of Net Position have been eliminated except those representing balances between the
governmental activities and the business-type activities, which are presented as internal balances and eliminated in
the total primary government column. In the Statement of Activities and Changes in Net Position, internal service
fund transactions have been eliminated; however, those transactions between governmental and business-type
activities have not been eliminated. The following interfund activities have been eliminated:
➢ Due to/from other funds
➢ Advances to/from other funds
➢ Transfers in/out
Governmental Fund Financial Statements
Governmental Fund Financial Statements include a Balance Sheet and a Statement of Revenues, Expenditures and
Changes in Fund Balances for all major governmental funds and non-major funds aggregated. An accompanying
schedule is presented to reconcile and explain the differences in Net Position as presented in these statements to the
Net Position presented in the Government-Wide Financial Statements. The City has presented all major funds that
met the applicable criteria.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
58
Note 1 – Summary of Significant Accounting Policies (Continued)
B. Basis of Presentation, Accounting and Measurement Focus (Continued)
Governmental Fund Financial Statements (Continued)
All governmental funds are accounted for on a spending or "current financial resources" measurement focus and
the modified accrual basis of accounting. Accordingly, only current assets and current liabilities are included on the
Balance Sheet. The Statement of Revenues, Expenditures and Changes in Fund Balances presents increases
(revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets.
Under the modified accrual basis of accounting, revenues are rec ognized in the accounting period in which they
become both measurable and available to finance expenditures of the current period. Measurable means that the
amounts can be estimated, or otherwise determined. Available means that the amounts were collected during the
reporting period or soon enough thereafter to be available to finance the expenditures accrued for the reporting
period. The City uses an availability period of 60 days for all revenues except grants, which use a six month
availability period.
Sales taxes, property taxes, franchise taxes, gas taxes, motor vehicle in-lieu, transient occupancy taxes, grants and
interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been
recognized as revenues of the current fiscal period to the extent normally collected within the availability period.
Other revenue items are considered to be measurable and available when cash is received by the government.
Revenue recognition is subject to the measurable and available criteria for the governmental funds in the fund
financial statements. Exchange transactions are recognized as revenues in the period in which they are earned
(i.e., the related goods or services are provided). Locally imposed derived tax revenue s are recognized as
revenues in the period in which the underlying exchange transaction upon which they are based takes place.
Imposed non -exchange transactions are recognized as revenues in the period for which they were imposed. If the
period of use is not specified, they are recognized as revenues when an enforceable legal claim to the revenues
arises or when they are received, whichever occurs first. Government -mandated and voluntary non -exchange
transactions have been recognized as revenues when all applicable eligibility requirements have been met.
The Reconciliation of the Fund Financial Statements to the Government-Wide Financial Statements is provided to
explain the differences created by the integrated approach of GASB Statement No. 34.
The City reports the following major Governmental Funds:
General Fund – This is the primary operating fund of the City. It accounts for all activities of the general
government, except those required to be accounted for in another fund.
Federal and State Grants Fund – This fund is used to report various grants awarded to the City by Federal,
State, and local governments not otherwise accounted for in the General Fund or Capital Projects funds. A
detailed report by program is available under a separat e report meeting the criteria of Title 2 U.S. Code of
Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit
Requirements for Federal Awards , for all federal grants received by the City.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
59
Note 1 – Summary of Significant Accounting Policies (Continued)
B. Basis of Presentation, Accounting and Measurement Focus (Continued)
Proprietary Fund Financial Statements
Proprietary Fund Financial Statements include a Statement of Net Position, a Statement of Revenues, Expenses and
Changes in Fund Net Position, and a Statement of Cash Flows for each major Proprietary Fund.
A separate column representing internal service funds is also presented in these statements. However, internal
service balances and activities have been combined with the governmental activities in the Government -Wide
Financial Statements. The City’s internal service funds include funds which provide services directly to other City
funds. These areas of service include workers' compensation, liability insurance, motorpool, and information
systems.
Proprietary funds are accounted for using the "economic resources" measurement focus and the accrual basis of
accounting. Accordingly, all assets and liabilities (whether current or noncurrent) are included on the Statement of
Net Position. The Statement of Revenues, Expenses and Changes in Fund Net Position presents increases (revenues)
and decreases (expenses) in total Net Position. Under the accrual basis of accounting, revenues are recognized in
the period in which they are earned while expenses are recognized in the period in which the liability is incurred.
In these funds, receivables have been recorded as revenue and provisions have been made for uncollectible amounts.
Operating revenues in the proprietary funds are those revenues that are generated from the primary operations of
the fund. All other revenues are reported as non-operating revenues. Operating expenses are those expenses that
are essential to the primary operations of the fund. All other expenses are reported as non-operating expenses.
The City reports the following major proprietary funds:
Water Fund – This fund is used to account for the provision of water services to the residential, commercial
and industrial segments of the City. All activities necessary to provide such services are accounted for in this
fund, including, but not limited to, administration, operations, maintenance, financing and rela ted debt
service, and billing and collection.
Sewer Fund – This fund is used to account for the provision of treatment to residential, commercial and
industrial segments of the City. All activities necessary to provide such services are accounted for in t his
fund, including, but not limited to, administration, operations, maintenance, financing and related debt
service, and billing and collection.
Sewer Collection Fund – This fund is used to account for the provision of wastewater collection to
residential, commercial and industrial segments of the City. All activities necessary to provide such services
are accounted for in this fund, including, but not limited to, administration, operations, maintenance,
financing and related debt service, and billing an d collection.
Integrated Waste Fund – This fund is used to account for the provision of refuse collection to the residential,
commercial and industrial segments of the City. All activities necessary to provide such services are
accounted for in this fund, including, but not limited to, administration, operations, maintenance, financing
and related debt service, and billing and collection.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
60
Note 1 – Summary of Significant Accounting Policies (Continued)
B. Basis of Presentation, Accounting and Measurement Focus (Continued)
Fiduciary Fund Financial State ments
Fiduciary fund financial statements include a Statement of Net Position and a Statement of Changes in Fiduciary
Net Position. The City’s fiduciary funds represent agency funds and private purpose trust funds. Both agency funds
and the private purpose trust funds are accounted for on the full accrual basis of accounting.
Fiduciary fund types are accounted for according to the nature of the fund. The City’s agency funds are purely
custodial in nature (assets equal liabilities) and thus do not involve measurement of results of operations. These
funds are used to account for money and property held by the City as trustee or custodian. The City establishe s
Agency Funds to account for money and property held by the City as trustee or custodian. Such funds inclu de
Special Deposits, Cemetery Perpetual Care, and San Bernardino Regional Water Resource Authority. 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. Such funds include Assessment Districts
#977A, #977B, and #1003.
The City’s private purpose trust fund is a fiduciary fund type used by the City to report assets, liabilities and
activities of the Successor Agency to the Redevelopment Agency for the City of San Bernardino. Its results of
operations are presented on the Statement of Changes of Fiduciary Net Position.
Successor Agency of the Redevelopment Agency for the City of San Bernardino
The Redevelopment Obligation Retirement Fund (Successor Agency) was created to serve as a custodian for
the assets and to wind down the affairs of the RDA on February 1, 2012, pursuant to Assembly Bill x1 26 .
Its purpose is to expeditiously wind down the affairs of the dissolved RDA. The Successor Agency is a separate
public entity from the City, subject to the direction of an oversight board. The City Council serves as the
governing board of the Successor Agency. In general, the Successor Agency’s assets can only be used to pay
enforceable obligations in existence at the date of dissolution (including the completion of any unfinished
projects that were subject to legally enforceable contractual commitments). In future fiscal years, the
Successor Agency will only be alloca ted revenue in the amount that is necessary to pay the estimated annual
installment payments on enforceable obligations of the former RDA until all enforceable obligations of the
former RDA have been paid in full and all assets have been liquidated. Based upon the nature of the Successor
Agency’s custodial role, the Successor Agency has been included in the accompanying basic financial
statements as a private purpose trust fund. On December 31, 2015, the California Department of Finance
(Finance) approved the City’s revised Long Range Property Management Plan (LRPMP), with the assets
deemed for governmental use and future development. Properties were transferred to the City of San Bernardino
effective upon the date of Finance’s approval of the LRPMP.
C. Deferred Outflows and Inflows of Resources
The Statement of Net Position reports separate sections for Deferred Outflows of Resources, and Deferred
Inflows of Resources, when applicable.
Deferred Outflows of Resources represent a consumption of net position that applies to a future period(s)
and so will not be recognized as an outflow of resources (expense/ expenditure) until then.
Deferred Inflows of Resources represent an acquisition of net position that applies to a future period(s)
and so will not be recognized as an inflow of resources (revenue) until that time.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
61
Note 1 – Summary of Significant Accounting Policies (Continued)
D. 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 appropriation, is employed as an extension of
budgetary controls.
E. Cash, Cash Equivalents and Investments
The City pools its available cash for investment purposes. The City considers pooled cash and investment amounts,
with original maturities of three months or less, to be cash equivalents.
Investments are reported in the accompanying financial statements at fair value, except for certain investment
contracts that are reported at cost because they are not transferable and they have terms that are not affected by
changes in market interest rates. Changes in fair value that occur during a fiscal year are rec ognized as
investment income reported for that fiscal year, and may result in negative investment income in the
accompanying financial statements. Investment income includes interest earnings, changes in fair value, and
any gains or losses realized upon th e liquidation, maturity, or sale of investments.
Investment income earned by the pooled investments is allocated to the various funds based on each fund's
average cash and investment balance, except for investment income associated with funds not legally required to
receive pooled investment income which has been assigned to and recorded as revenue of the general fund, as
provided by California Government Code Section 53647.
For purposes of the statement of cash flows, amounts reported as cash and cash eq uivalents, include amounts on
deposit in the City pool and any short-term, highly liquid investments that are both readily convertible to known
amounts of cash or so near their maturity that they present insignificant risk of changes in value because of
changes in interest rates.
Certain disclosure requirements, if applicable, for deposits and investment risks in the following areas:
➢ Interest rate risk
➢ Credit risk
- Overall
- Custodial credit risk
- Concentration of credit risk
➢ Foreign currency risk
In addition, other disclosures are specified including use of certain methods to present deposits and investments,
highly sensitive investments, credit quality at year-end and other disclosures.
F. Restricted Assets
Amounts reported as restricted assets in the enterprise funds have been restricted by bond indentures or are to be
used for specified purposes based on contract provisions, such as bonded debt service.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
62
Note 1 – Summary of Significant Accounting Policies (Continued)
G. Fair Value Measurement
U.S. GAAP establishes a framework for measuring fair value, and establishes disclosures about fair value
measurement. Investments, unless otherwise specified, recorded at fair value in the Statements of Net Position,
are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Levels
of inputs are as follows:
Level 1 – Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the
measurement date.
Level 2 – Inputs, other than quoted prices included in Level 1, which are observable for the asset s or liabilities
through corroboration with market data at the measurement date.
Level 3 – Unobservable inputs that reflect management’s best estimate of what market participants would use
in pricing the assets or liabilities at the measurement date.
H. Receivables
Customer or trade receivables are reported as “accounts receivable” and are shown net of an allowance for
uncollectible accounts based on historical and management estimates.
Noncurrent portions of long-term receivables (e.g. “notes receivable”) due to governmental fund types are reported
in their respective balance sheets despite their spending measurement focus. Recognition of governmental fund
type revenues represented by noncurrent receivables are deferred until they become current receivables. Noncurrent
portions of long-term notes receivable are offset by nonspendable fund balance in the general fund, and by
restricted, committed or assigned fund balance in other funds.
I. Interfund Transactions
Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the
fiscal year are referred to as either “due to/from other funds” or “advances to/from other funds” (i.e., the current
portion of interfund loans). Any residual balances outstanding between the governmental activities and business-
type activities are reported in the Governmental-Wide Financial Statements as “internal balances.”
J. Inventory
Inventories are valued on the average cost method. Inventory balances represent expendable supplies held for
consumption. Inventory is reported under the consumption method whereby expenditures are reported at the time
inventory is used. Inventory reported in governmental funds is offset with nonspendable fund balance to show that
inventories do not constitute available spendable resources, even though they are a component of fund balance.
K. Prepaid Items
Prepaid items are reported in the governmental funds under the consumption method and are reported as a
nonspendable component of fund balance to indicate that they are not spendable for appropriation and are not
expendable financial resources.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
63
Note 1 – Summary of Significant Accounting Policies (Continued)
L. Property Held for Resale
Property held for resale represents land, structures, and related improvements that were acquired for resale as part
of the City’s redevelopment and grant activities. Property held for resale is accounted for is recorded at lower of
cost or net realizable value in accordance with accounting principles generally accepted in the United States of
America. Property held for resale, which is not available for current expenditure, is reported in the governmental
funds balance sheet as restricted fund balance when proceeds from the sale must be used for restricted purposes or
as nonspendable fund balance when such proceeds are not restricted.
M. Capital Assets
Capital assets, which include land, buildings and improvements, machinery, vehicles, equipment (including
furniture) and infrastructure assets, are reported in the applicable activity columns in the accompanying
government-wide statement of net position and the proprietary funds statement of net position. Capital assets are
defined using guidelines established by the City. Such guidelines provide that assets with an initial individual cost
of more than $5,000 ($200,000 for infrastructure) and an estimated useful life of at least two years are considered
to be capital assets. Such capital assets are recorded at cost where historical records are available and at an estimated
original cost where no historical records exist. Donated or contributed capital assets are recorded at their acquisition
value at the date of the contribution. The cost of normal maintenance and repairs that do not add to the value of the
assets or materially extend asset lives are not capitalized. Major outlays for capital assets and improvements are
capitalized as projects are constructed.
Capital assets include public domain (infrastructure) consisting of certain improvements other than buildings,
including pavement, curbs and gutters, streets and sidewalks, drainage systems, traffic control devices, streetlights,
and right-of-way corridors within the City.
Capital assets used in operations are depreciated over their estimated useful lives using the straight -line method in
the government-wide financial statements and in the financial statements of the proprietary funds. Depreciation is
charged as an expense against operations and accumulated depreciation is reported on the respective statement of
net position.
The ranges of lives used for depreciation purposes for each capital asset class are:
Years
Buildings and improvements 10 - 40
Infrastructure 20 - 50
Wells, pumping plants, reservoirs, and distribution system 8 - 50
Interceptor lines 50
Disposal plant 35 - 50
Leasehold improvements 5 - 25
Shops, office, stores and yards 10 - 20
Tools and equipment 4 - 20
Office equipment 5 - 20
Communication equipment 7 - 10
Computer equipment 5 - 10
Automotive equipment 3 - 8
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
64
Note 1 – Summary of Significant Accounting Policies (Continued)
M. Capital Assets (Continued)
Each major infrastructure system can be divided into subsystems. For example, the street system can be subdivided
into pavement, curbs and gutters, sidewalks, medians, streetlights, landscaping and land. These subsystems were
not delineated in the basic financial statements. The appropriate operating department maintains information
regarding the sub-systems. Interest accrued during capital assets construction, if any, is capitalized for the business-
type funds as part of the asset cost.
For all infrastructure systems, the City elected to use the Basic Approach for infrastructure reporting.
N. Capital Contribution
Contributions in aid of construction represent cash and utility plant additions contributed to the City by property
owners or developers desiring services that require capital expenditures or capacity commitment.
O. Long-Term Debt
For the government-wide financial statements and proprietary fund financial statements, long-term debt and other
financial obligations are reported as liabilities, net of bond premiums or discounts. Bond premiums and discounts
are amortized over the life of the bonds using the straight-line method. Issuance costs are reported as expense when
incurred.
Governmental fund financial statements do not present long-term debt but are shown in the Reconciliation of the
Governmental Funds Balance Sheet to the Government-wide Statement of Net Position.
P. Refunding of Debt
The difference between the reacquisition price of refunding bonds and the net carrying amount of refunded debt
(deferred amount on refunding) is amortized over the shorter of the lives of the refunding debt or remaining life of
the refunded debt. Unamortized portions of the loss on refunding debt are reported as deferred outflows of resources.
Q. Compensated Absences
In accordance with negotiated labor agreements, employees accumulate earned but unused vacation, other
compensated leave, and sick leave pay benefits. Depending upon bargaining unit and date of hire, employees were
allowed to apply 100% of accrued sick leave hours for additional California Public Employees’ Retirement System
(CalPERS) service credit upon retirement.
After subtracting the sick leave balance equivalent of one full year of service credit (2080 hours), which may be
applied to CalPERS service credit, any sick leave balance remaining upon separation shall be paid at a specific
percentage of the cash value to employees who have remained in City service until the dates specified in the labor
agreements.
Government-Wide Financial Statements
For governmental and business-type activities, compensated absences are recorded as expenses when earned.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
65
Note 1 – Summary of Significant Accounting Policies (Continued)
Q. Compensated Absences (Continued)
Fund Financial Statements
For governmental funds, compensated absences are recorded as expenditures in the year paid. The General Fund is
typically used to liquidate compensated absences. In proprietary funds, compensated absences are expensed to the
various funds in the period they are earned, and such fund’s share of the unpaid liability is recorded as a long-term
liability of the fund.
R. Pension Plans
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources
related to pensions, and pension expense, information about the fiduciary net position of the plans and additions
to/deductions from the plans’ fiduciary net position have been determined on the same basis as they are reported
by the plans (Note 10). For this purpose, benefit payments (including refunds of employee contributions) are
recognized when due and payable in accordance with benefit terms. Investments are reported at fair value. The
General Fund and Internal Service Funds are typically used to liquidate the pension liability related to the City's
governmental activities while the pension liability for Business-type activities is liquidated from the Enterprise
Funds.
The following timeframes are used for pension reporting:
Valuation Date June 30, 2017
Measurement Date June 30, 2018
Measurement Period:July 1, 2017 to June 30, 2018
Gains and losses related to changes in total pension liability and fiduciary net position are recognized in pension
expense systematically over time. The first amortized amounts are recognized in pension expense for the year the
gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources
related to pensions and are to be recognized in future pension expense. The amortization period differs depending
on the source of the gain or loss. The difference between projected and actual earnings is amortized straight-line
over 5 years. All other amounts are amortized straight-line over the average expected remaining service lives of all
members that are provided with benefits (active, inactive, and retired) as of the beginning of the measurement
period.
S. Other Postemployment Benefits (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources
related to OPEB, and OPEB expense, information about the fiduciary net position of the OPEB plan, the assets of
which are held in an irrevocable trust, and additions to/deductions from the OPEB plan’s fiduciary net position have
been determined by an independent actuary (Note 11). For this purpose, benefit payments are recognized when
currently due and payable in accordance with the benefit terms. Investments are reported at fair value. The
Enterprise Funds are used to liquidate the OPEB liability.
Generally accepted accounting principles require that the reported results must pertain to liability and fiduciary net
position information within certain defined timeframes. For this report, the following timeframes are used:
Valuation Date June 30, 2017
Measurement Date June 30, 2018
Measurement Period:July 1, 2017 to June 30, 2018
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
66
Note 1 – Summary of Significant Accounting Policies (Continued)
T. Fund Balances
As prescribed by U.S. GAAP, governmental funds report fund balance in classifications based primarily on the
extent to which the City is bound to honor constraints on the specific purposes for which amounts in the funds can
be spent. As of June 30, 2019, fund balances for governmental funds are made up of the following:
• Nonspendable Fund Balance – includes amounts that are (a) not in a spendable form, or (b) legally or
contractually required to be maintained intact. The “not in spendable form” criterion includes items that
are not expected to be converted to cash, for example: deposits and prepaid items.
• Restricted Fund Balance – includes amounts that are restricted for specific purposes stipulated by external
resources providers, constitutionally or through enabling legislation. Restrictions may effectively be
changed or lifted with the consent of resource providers.
• Committed Fund Balance – includes amounts that have been limited to specific purposes or through
adoption of a resolution or an ordinance by the City Council, the highest level of decision making authority
of the City, and resources that have been specifically committed for use in satisfying contractual
obligations, as in agreements with third-parties. The City has determined that both a resolution and an
ordinance are equally binding. These commitments may be changed or lifted, but only by the same formal
action that was used to impose the constraint originally. City Council action to commit fund balance must
occur within the fiscal reporting period while the amount committed may be subsequently determined.
• Assigned Fund Balance – includes amounts that are intended to be used by the City for specific purposes.
Intent is expressed by (a) the City Council or (b) a body or official to which the City Council has delegated
the authority to assign amounts to be used for a specific purpose.
• Unassigned Fund Balance – includes amounts within the General Fund, the residual resources, either
positive or negative in excess of what can be properly classified in one of the other four fund balance
categories. Unassigned amounts are technically available for any purpose. Other governmental funds may
only report a negative unassigned balance that was created after classification of fund balance in the
nonspendable, restricted or committed categories.
The City considers the restricted fund balances to have been spent when an expenditure is incurred for purposes for
which both unrestricted and restricted fund balance is available. The City considers unrestricted fund balances to
have been spent when an expenditure is incurred for purposes for which amounts in any of the unrestricted
classifications of fund balance could be used. In circumstances when an expenditure is made for a purpose for which
amounts are available in multiple fund balance classifications, fund balance is depleted in order of r estricted,
committed, assigned, and unassigned.
U. Net Position
The financial statements utilize a net position presentation. Net position is classified as follows:
• Net Investment in Capital Assets – This category of net position consists of capital assets, net of
accumulated depreciation and reduced by any debt outstanding and any deferred outflows of resources
related to such borrowings that are attributable to the acquisition, construction or improvement of those
assets. If there are significant unspent related debt proceeds at year-end, the portion of the debt attributable
to the unspent proceeds is not included in the calculation of net investment in capital assets. Rather, that
portion of the debt is offset by unspent proceeds.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
67
Note 1 – Summary of Significant Accounting Policies (Continued)
U. Net Position (Continued)
• Restricted Net Position – This category presents restricted assets reduced by liabilities and deferred inflows
of resources related to those assets. Those assets are restricted due to external restrictions imposed by
creditors (such as through bond covenants), grantors or laws and regulations of other governments and
restrictions imposed through constitutional provisions or enabling legislation.
• Unrestricted – This category represents net position of the City that is not restricted for any project or other
purpose.
When both restricted and unrestricted resources are available for use, the City’s policy is to use restricted resources
first, then unrestricted resources that are needed.
V. Property Taxes
Property tax revenue is recognized in the fiscal year for which the taxes have been levied providing they become
available. Available means due, or past due and receivable within the current period and collected within the current
period or expected to be collected soon enough thereafter (not to exceed 60 days) to be used to pay liabilities in the
current period.
Under California law, property taxes are assessed and collected by the counties at up to 1% of assessed value, plus
other increases approved by the voters. The County of San Bernardino, bills and collects the property t axes and
remits them to the City at various times throughout the year. Property taxes are attached as an enforceable lien on
property as of January 1. Taxes are levied on July 1 and are due in two installments. The first installment is due on
November 1, and is payable through December 10 without penalty. The second installment is due February 1, and
is payable through April 10 without penalty.
On June 30, 2016, the City transferred assets and liabilities comprising its fire service operations to the San
Bernardino County Fire Protection District (SBCFPD) for the purpose of regionalization of fire services. As a result
of the transfer, the City is required to transfer annual revenues from property taxes and 35 percent of its annual
property tax in lieu of Vehicle License Fee (VLF) revenue to SBCFPD. Beginning July 1, 2017, the VLF portion
due to the County was reduced to 26.5 percent.
W. Use of Accounting Estimates
The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires
management to make estimates and assumptions, in some cases when applicable, that affect the amounts in the
financial statements and the accompanying notes. Actual results could differ from the estimates.
X. Implementation of New GASB Pronouncements for the Year Ended June 30, 2019
The requirements of the following accounting standards are effective for the purpose of implementation, if
applicable to the City, for the year ended June 30, 2019. The financial statements included herein apply the
requirements and provisions of these statements, including necessary retroactive adjustments to financial statement
classifications and presentations.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
68
Note 1 – Summary of Significant Accounting Policies (Continued)
X. Implementation of New GASB Pronouncements for the Year Ended June 30, 2019 (Continued)
GASB Statement No. 83
In November 2016, GASB issued Statement No. 83, Certain Asset Retirement Obligations. This Statement
establishes criteria for determining the timing and pattern of recognition of a liability and a corresponding deferred
outflow of resources for asset retirement obligations (ARO). This Statement requires that recognition occur when
the liability is both incurred and reasonably estimable. The determination of when the liability is incurred should
be based on the occurrence of external laws, regulations, contracts, or court judgments, together with the occurrence
of an internal event that obligates a government to perform asset retir ement activities. Laws and regulations may
require governments to take specific actions to retire certain tangible capital assets at the end of the useful lives of
those capital assets, such as decommissioning nuclear reactors and dismantling and removing sewage treatment
plants. Other obligations to retire tangible capital assets may arise from contracts or court judgments. Internal
obligating events include the occurrence of contamination, placing into operation a tangible capital asset that is
required to be retired, abandoning a tangible capital asset before it is placed into operation, or acquiring a tangible
capital asset that has an existing ARO. Application of this statement is effective for the City’s fiscal year ending
June 30, 2019. This pronouncement did not have a material effect on the financial statements of the City.
GASB Statement No. 88
In April 2018, GASB issued Statement No. 88, Certain Disclosures Related to Debt, including Direct Borrowings
and Direct Placements. This Statement is to improve the information that is disclosed in notes to government
financial statements related to debt, including direct borrowings and direct placements. It also clarifies which
liabilities governments should include when disclosing information related to debt. The statement also defines debt
for purposes of disclosure in notes to financial statements as a liability that arises from a contractual obligation to
pay cash (or other assets that may be used in lieu of cash) in one or more payments to settle an amount that is fixed
at the date the contractual obligation is established. In addition the statement requires that additional essential
information related to debt be disclosed in notes to financial statements, including unused lines of credit; assets
pledged as collateral for the debt; and terms specified in debt agreements related to significant events of default
with finance-related consequences, significant termination events with finance-related consequences, and
significant subjective acceleration clauses. This pronouncement did not have a material effect on the financial
statements of the City.
Y. Upcoming Government Accounting Standards Implementations
The City is currently analyzing its accounting practices to determine the potential impact on the financial statements
for the following GASB statements:
GASB Statement No. 87
In June 2017, GASB issued Statement No. 87, Leases. This Statement increases the usefulness of governments’
financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were
classified as operating leases and recognized as inflows of resources or outfl ows of resources based on the payment
provisions of the contract. It establishes a single model for lease accounting based on the foundational principle
that leases are financings of the right to use an underlying asset. Under this Statement, a lessee is required to
recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease
receivable and a deferred inflow of resources, thereby enhancing the relevance and consistency of information about
governments’ leasing activities. Application of this statement is effective for the City’s fiscal year ending
June 30, 2021.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
69
Note 1 – Summary of Significant Accounting Policies (Continued)
Y. Upcoming Government Accounting Standards Implementations (Continued)
GASB Statement No. 89
In June 2018, GASB issued Statement No. 89, Accounting for Interest Cost Incurred before the End of a
Construction Period. This Statement establishes accounting requirements for interest cost incurred before the end
of a construction period. Such interest cost includes all interest that previously was accounted for in accordance
with the requirements of paragraphs 5–22 of Statement No. 62, Codification of Accounting and Financial Reporting
Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements, which are superseded by this
Statement. This Statement requires that interest cost incurred before the end of a construction period be recognized
as an expense in the period in which the cost is incurred for financial statements prepared using the economic
resources measurement focus. As a result, interest cost incurred before the end of a construction period will not be
included in the historical cost of a capital asset reported in a business-type activity or enterprise fund. Application
of this statement is effective for the City’s fiscal year ending June 30, 2021.
GASB Statement No. 90
In August 2018, GASB issued Statement No. 90, Majority Equity Interests– An Amendment of GASB Statements
No. 14 and No. 61. This Statement improves the consistency and comparability of reporting a government’s
majority equity interest in a legally separate organization and to improve the relevance of financial statement
information for certain component units. It defines a majority equity interest and specifies that a majority equity
interest in a legally separate organization should be reported as an investment if a government’s holding of the
equity interest meets the definition of an investment. A majority equity interest that meets the definition of an
investment should be measured using the equity method, unless it is held by a special-purpose government engaged
only in fiduciary activities, a fiduciary fund, or an endowment (including permanent and term endowments) or
permanent fund. Those governments and funds should measure the majority equity interest at fair value. Application
of this statement is effective for the City’s fiscal year ending June 30, 2020.
GASB Statement No. 91
In May 2019, GASB issued Statement No. 91, Conduit Debt Obligations. The primary objectives of this Statement
are to provide a single method of reporting conduit debt obligations by issuers and eliminate diversity in practice
associated with (1) commitments extended by issuers, (2) arrangements associated with conduit debt obligations,
and (3) related note disclosures. This Statement achieves those objectives by clarifying the existing definition of a
conduit debt obligation; establishing that a conduit debt obligation is not a liability of the issuer; establishing
standards for accounting and financial reporting of additional commitments and voluntary commitments extended
by issuers and arrangements associated with conduit debt obligations; and improving re quired note disclosures.
Application of this statement is effective for the City’s fiscal year ending June 30, 2022.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
70
Note 2 – Cash and Investments
Cash and investments are presented in the accompanying financial statements at June 30, 2019 as follows:
Fiduciary Funds
Governmental Business-Type Statement of
Activities Activities Total Net Position Total
Cash and investments 99,136,618$ 87,984,037$ 187,120,655$ 23,921,269$ 211,041,924$
Cash and investments with fiscal agent 73,416 - 73,416 18,676,896 18,750,312
Restricted cash - 59,948,377 59,948,377 - 59,948,377
Restricted investment - Consent Decree (Note 20)- 23,346,376 23,346,376 - 23,346,376
Total cash and investments 99,210,034$ 171,278,790$ 270,488,824$ 42,598,165$ 313,086,989$
Government-Wide Statement of Net Position
Cash and investments at June 30, 2019, consisted of the following:
Cash:
Cash on hand 14,265$
Deposits with financial institution 85,244,483
Total cash 85,258,748
Investments:
Investments 120,876,078
Investments held by bond trustee 106,952,163
Total investments 227,828,241
Total cash and investments 313,086,989$
As part of the City's investment guidelines, the City continually seeks ways to increase investment income while not
risking investment principal. One way the City accomplishes this is by “sweeping”, on a nightly basis, any excess
cash held in its non -interest bearing checking account to an interest bear ing money market account with the same
bank.
A. Demand Deposits
The carrying amounts of the City’s demand deposits were $85,244,483 at June 30, 2019. Bank balances were
$87,311,822 at that date, the total amount of which was collateralized or insured with securities held by the
pledging financial institutions in the City’s name as discussed below.
The California Government Code requires California banks and savings and loan associations to secure the City’s
cash deposits by pled ging securities as collateral. This Code states that collateral pledged in this manner shall
have the effect of perfecting a security interest in such collateral superior to those of a general creditor. Thus,
collateral for cash deposits is considered to be held in the City's name.
The market value of pledged securities must equal at least 110% of the City's cash deposits. California law also
allows institutions to secure City’s deposits by pledging first trust deed mortgage notes having a value of 150%
of the City’s total cash deposits. The City may waive collateral requirements for cash deposits, which are fully
insured up to $250,000 by the Federal Deposit I nsurance Corporation (“FDIC”). The City, however, has not
waived the collateralization requirements.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
71
Note 2 – Cash and Investments (Continued)
B. Investments Authorized by the California Government Code and the City’s Investment Policy
The table below identifies the investment types that are authorized for the City by the California Government
Code and the City's investment policy. The table also identifies certain provisions of the California Government
Code (or the City's investment policy, if more restrictive) that address interest rate ris k and concentration of
credit risk. This table does not address investments of debt proceeds held by bond trustees that are governed by
the provisions of debt agreements of the City, rather than the general provisions of the California Government
Code or the City's investment policy.
Maximum Maximum
Maximum Percentage Investment in
Authorized Investment Types Maturity of Portfolio One Issuer*
United States Treasury Obligations 5 years None None
United States Federal Agency securities 5 years None None
Bonds, Notes or Registered Warrants Issue
by the State of California or Local
Agencies within the State of California 5 years None None
Bankers' Acceptances 180 days 40%30%
Commercial Paper 270 days 25%10%
Negotiable Certificates of Deposit 5 years 30%None
Time Cerificates of Deposit N/A 25%None
Medium-term Corporates Notes 5 years 30%15%
Money Market Mutual Funds N/A 20%10%
Mortgage Pass - through Securities 5 years 20%None
Local Agency Investment (LAIF)N/A None $50 million
* Based on state law requirements or City investment policy requirements, whichever is more restrictive.
C. Investments Authorized by Debt Agreements
Investment of debt proceeds held by fiscal agents are governed by provisions of the debt agreements, rather than
the general provisions of the California Government Code or the City’s investment policy. The table below
identifies the investment types that are authorized for investments held by fiscal agents. The table also identifies
certain provisions of these debt agreements that address interest rate risk and concentration of credit risk.
Maximum Maximum
Maximum Percentage Investment in
Authorized Investment Types Maturity Allowed One Issuer
United States Treasury Obligations None None N/A
United States Federal Agency Securities None None None
Bonds, Notes or Registered Warrants
Issued by the State of California or Local
Agencies within the State of California 5 yrs None None
Bankers' Acceptances 180-360 days None None
Commercial Paper 90-180 days None None
Medium-term Corporate Notes None None None
Money Market Mutual Funds N/A None None
Investment Contracts None None None
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
72
Note 2 – Cash and Investments (Continued)
D. Fair Value Measurement
As of June 30, 2019, the City’s investments had the following recurring fair value measurements:
Investments measured by fair value level:June 30, 2019 Level 1 Level 2 Level 3
Commercial paper 444,430$ -$ 444,430$ -$
Federal agency securities 61,647,627 - 61,647,627 -
U.S. Treasury obligations 32,398,775 32,398,775 - -
Medium-term corporate notes 6,721,604 - 6,721,604 -
Asset backed securities 4,424,305 - 4,424,305 -
Total investments by fair value level 105,636,741$ 32,398,775$ 73,237,966$ -$
Investments not subject to the fair value hierarchy:
Local Agency Investment Fund 4,302,755$
Money market mutual funds 107,545,057
Certificates of deposit 10,343,688
Total investments not subject to the fair value hierarchy 122,191,500$
Total investments 227,828,241$
Debt and equity securities classified in Level 1 are valued using prices quoted in active markets for those securities.
Debt and equity securities classified in Level 2 are valued using the following approaches:
• U.S. Treasuries, U.S. Agencies, and Commercial Paper: quoted prices for identical securities in markets that
are not active;
• Medium term notes: quoted prices for similar securities in active markets; and
• Asset-backed securities: recent appraisals of the asset value.
E. Risk Disclosure
Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest will adversely affect the fair value of an investment.
Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market
interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination
of shorter term and longer term investments and by timing cash flows from maturities so that a portion of the
portfolio is maturing or coming close to maturity evenly over time as necessary to provide the cash flow and
liquidity needed for operations.
Information about the sensitivity of the fair values of the City’s investments (including investments held by bond
trustee) to market interest rate fluctuations is provided by the following table that shows the distribution of the
City’s investments by maturity. For purposes of the schedule shown on the next page, any callable securities are
assumed to be held to maturity.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
73
Note 2 – Cash and Investments (Continued)
E. Risk Disclosure (Continued)
Disclosures Relating to Interest R ate Risk (Continued)
Investment Type Total 1 year or fewer 1 to 2 years Over 2 years
Local Agency Investment Fund 4,302,755$ 4,302,755$ -$ -$
Commercial paper 444,430 444,430 - -
Money market mutual funds 23,939,270 23,939,270 - -
Certificates of deposit 10,343,688 2,612,135 3,323,603 4,407,950
Federal agency securities 61,647,627 13,646,589 14,409,919 33,591,119
U.S. Treasury obligations 32,398,775 3,392,579 4,993,499 24,012,697
Medium-term corporate notes 6,721,604 1,221,299 2,173,393 3,326,912
Asset backed securities 4,424,305 314,553 3,565,343 544,409
Held by bond trustee:
Money market mutual funds 83,605,787 83,605,787 - -
Total investments 227,828,241$ 133,479,397$ 28,465,757$ 65,883,087$
Investment Maturities
Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the
investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization.
However, some issuers do not seek a credit rating. For instance, the California Local Agency Investment Fund
(LAIF) has not sought or received a credit rating. In these cases, the purchaser is solely responsible for performing
their own due diligence before purchasing an investment or participating in an external investment pool. Certificates
of deposit of $250,000 or less are fully insured by the Federal Deposit Insurance Corporation (FDIC), and therefore,
do not seek a credit rating.
Presented below is the minimum rating required by (where applicable) the California Government Code, the City’s
investment policy, or debt agreements, and the actual rating as of year-end for each investment type.
Minimum Ratings Rating
Legal at Year-End at Year-End
Investment Type Total Rating AA or AAA A /A-1 Not Rated
Local Agency Investment Fund 4,302,755$ N/A -$ -$ 4,302,755$
Commercial paper 444,430 A-1 - 444,430 -
Money market mutual funds 23,939,270 AA+193,437 - 23,745,833
Certificates of deposit 10,343,688 N/A - 2,919,710 7,423,978
Federal agency securities 61,647,627 AA 61,647,627 - -
U.S. Treasury obligations 32,398,775 N/A 4,989,625 - 27,409,150
Medium-term corporate notes 6,721,604 AA-6,721,604 - -
Asset backed securities 4,424,305 AA 4,424,305 - -
Held by bond trustee:
Money market mutual funds 83,605,787 AA+59,948,377 - 23,657,410
Total investments 227,828,241$ 137,924,975$ 3,364,140$ 86,539,126$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
74
Note 2 – Cash and Investments (Continued)
E. Risk Disclosure (Continued)
Disclosure Relating to Concentration of Credit Risk
The investment policy of the City contains no limitations on the amount that can be invested in any one issuer
beyond that stipulated in the Government Code. GASB Statement No. 40 requires disclosure by amount and issuer,
of investments in any one issuer that represent 5% or more of total investments. Investments in any one issuer (other
than U.S. Treasury securities, mutual funds, and external investment pools) that represents 5% or more of the City's
total investments are as follows:
Reported Percentage
Issuer Amount of Portfolio
Federal National Mortgage Association 15,396,184$ 6.76%
Federal Home Loan Mortgage Corp.11,416,942 5.01%Federal Agency Securities
Investment Type
Federal Agency Securities
Disclosures Relating to Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a
government will not be able to recover its deposits or will not be able to recover collateral securities that are in
the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of t he
failure of the counterparty (e.g., broker -dealer) to a transaction, a government will not be able to recover the
value of its investment or collateral securities that are in the possession of another party. The California
Government Code and the City’s investment policy do not contain legal or policy requirements that would limit
the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits:
The California Government Code requires that a financial institution secure deposits made by state or local
governmental units by pledging securities in an undivided collateral pool held by a depository regulated under
state law (unless so waived by the governmental unit). The market value of the pledged securities in the collateral
pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows
financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150%
of the secured public deposits. At June 30, 2019, the City’s deposits (bank balances) were collateralized under
California Law.
F. Investment in State Investment Pool
The City is a participant in LAIF which is regulated by California Government Code Section 16429 under the
oversight of the Treasurer of the State of California. The City’s investments in LAIF at June 30, 2019 included a
portion of pool funds invested in Structure Notes and Asset-Backed Securities:
Structured Notes are debt securities (other than asset-backed securities) whose cash-flow characteristics
(coupon rate, redemption amount, or stated maturity) depend upon one or more indices and/or that have
embedded forwards or options.
Asset-Backed Securities, the bulk of which are mortgage-backed securities, entitle their purchasers to receive a
share of the cash flows from pool of assets such as principal and interest repayments from a pool of mortgages
(such as Collateralized Mortgage Obligations) or credit card receivables.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
75
Note 2 – Cash and Investments (Continued)
F. Investment in State Investment Pool (Continued)
As of June 30, 2019, the City had $4,302,755 invested in LAIF, which had invested 2.67% of the pool investment
funds in Structured Notes and Asset-Back Securities. LAIF determines fair value on its investment portfolio based
on market quotations for those securities where market quotations are readily available and based on amortized cost
or best estimate for those securities where market value is not readily available. The City valued its investments in
LAIF as of June 30, 2019, by multiplying its account balance with LAIF times a fair value factor determined by
LAIF. This fair value factor was determined by dividing all LAIF participants’ total aggregate amortized cost by
total aggregate fair value. The fair value of the City’s position in the pool is the s ame as the value of the pool
shares. The credit quality rating of LAIF is unrated as of June 30, 2019.
Note 3 – Notes Receivables
The City uses funds generated from the former EDA as well as state and federal funding sources to offer financial
assistance to qualified developers, individuals, and families primarily for housing development, rehabilitation, and
economic development. Repayment terms on these loans can be classified in the following categories: 1) Deferred loans
which are due and payable only upon sale or transfer of title to the property; 2) Amortizing loans which have a set
monthly payment, which may be interest bearing or principal only; 3) Forgivable loans which may convert to grants
depending on the terms of the loan agreements; 4) Residual receipts loans which require repayments only when the
properties have positive cash flows pursuant to a formula set forth in the l oan agreement; and 5) Term loans which
require payment in full on the maturity date of the loans.
In the financial statements, notes receivable are reported net of an allowance for doubtful accounts. In estimating the
allowance, management considered the following factors: 1) composition of the loan portfolio; 2) past write-off
experience; 3) past market valuation; and 4) life-to-date interest and principal payments, if applicable. The allowance
estimate is continually evaluated and adjusted to reflect what management believes to be the net realizable value of the
total loan portfolio.
At June 30, 2019, notes receivable consisted of the following:
Allowance for Financial
Notes Receivable Doubtful Accounts Statement
Balance Balance Balance
June 30, 2019 June 30, 2019 June 30, 2019
City:
Federal and State Grants Fund 9,677,563$ (9,677,563)$ -$
Low and Moderate Income Housing Fund 30,331,275 (30,017,302) 313,973
Total City 40,008,838 (39,694,865) 313,973
Successor Agency:
Successor Agnecy to the Economic Development
Agency of San Bernardino 1,982,780 (1,982,780) -
Total Successor Agency 1,982,780 (1,982,780) -
Total 41,991,618$ (41,677,645)$ 313,973$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
76
Note 4 – Interfund Receivables, Payables, and Transfers
A. Due To / From Other Funds
Amounts due to and due from other funds at June 30, 2019, were as follows:
Due From Due To Amount Purpose
General Fund Water Enterprise Fund 2,547,991$ Cost reimbursement
General Fund Sewer Collection Enterprise Fund 2,291,155 Cost reimbursement
General Fund Motorpool Internal Service Fund 131,975 Overdrawn Cash
General Fund Information Systems Internal Service Fund 220,358 Overdrawn Cash
Subtotal 5,191,479
Liability Insurance Internal Service Fund Workers' Compensation Internal Service Fund 2,176,676 Overdrawn Cash
Total 7,368,155$
B. Transfers
Interfund transfers during the year ended June 30, 2019, consisted of the following:
Transfers In Transfers Out Amount Purpose
RMRA Gas Tax Special Revenue Fund Special Gas Tax Special Revenue Fund 1,491,125$ New Fund
C. Long-Term Advances
At June 30, 2019, the balances of long-term advances were as follows:
Advances To Advances From Amount
Integrated Waste Enterprise Fund Motorpool Internal Service Fund 1,710,000$
In 2018, the Integrated Waste Enterprise Fund entered into loan agreement with Motorpool Internal Service Fund
in the amount of $1,710,000. The loan is to be repaid over 2 years at 2.0% interest rate per year. This loan is for
upgrading the existing fuel station at the City Yard. At June 30, 2019, the outstanding balance of the agreement was
$1,710,000.
The annual requirements to amortize the loan are as follows:
Year Ended June 30,Principal Interest Total
2019 -$ 14,250$ 14,250$
2020 855,000 34,200 889,200
2021 855,000 17,100 872,100
1,710,000$ 65,550$ 1,775,550$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
77
Note 5 – Property Held for Resale
Property held for resale represents single-family, multi-family, commercial, and retail real estate acquired by the City
in the General Fund, the Low and Moderate Income Housing Fund and the Federal and St ate Grant Fund. Five
properties, originally held by the Successor Agency, were released to the City by the California Department of Finance
and bankruptcy decree. Property held for resale is recorded at the lower of cost or net realizable value in accordance
with accounting principles generally accepted in the United States and is evaluated for impairment on an annual basis.
These properties range in value from approximately $134,000 to $16.75 million and total $32.2 million, and are
recorded in the City’s General Fund. Approximately 58 properties are reported in the Federal and State Grants Fund
major special revenue fund ranging in amount from under $1,000 to $640,000, and total $16.1 million. The Low and
Moderate Income Housing special revenue fund includes approximately 5 7 properties ranging in amount from
approximately $5,000 to $1.8 million, and total $16.0 million.
Property held for resale in the Successor Agency represents vacant land and commercial and retail real estate acquired
by the EDA as part of its redevelopment activities. Approximately 39 properties ranging from under $1,000 to $2.5
million, and totaling $9.3 million, were transferred to the Successor Agency upon dissolution of the redevelopment
agency. These properties are being held for disposition in accordance with applicable laws and regulations.
Note 6 – Capital Assets
A. Governmental Activities
The summary of changes in governmental activities capital assets for the year ended June 30, 2019, is as follows:
Balance Balance
July 1, 2018 Additions Deletions Transfers June 30, 2019
Capital assets, not being depreciated:
Land 103,334,621$ -$ -$ -$ 103,334,621$
Construction in progress 14,500,483 8,688,194 - (8,062,653) 15,126,024
Total capital assets, not being depreciated 117,835,104 8,688,194 - (8,062,653) 118,460,645
Capital assets, being depreciated:
Infrastructure 505,197,955 - - 3,510,986 508,708,941
Buildings and improvements 72,883,247 - - 4,551,667 77,434,914
Machinery, vehicles, and equipment 49,724,290 1,773,321 (725,845) - 50,771,766
Subtotal 627,805,492 1,773,321 (725,845) 8,062,653 636,915,621
Less accumulated depreciation
Infrastructure (336,825,745) (13,122,326) - - (349,948,071)
Buildings and improvements (63,717,209) (993,209) - - (64,710,418)
Machinery, vehicles, and equipment (44,024,325) (2,049,305) 725,845 - (45,347,785)
Subtotal (444,567,279) (16,164,840) 725,845 - (460,006,274)
Capital assets being depreciated, net 183,238,213 (14,391,519) - 8,062,653 176,909,347
Intangible assets, being amortized:
Purchased software 5,946,327 - - - 5,946,327
Accumulated amortization (4,410,194) (594,633) - - (5,004,827)
Subtotal 1,536,133 (594,633) - - 941,500
Total capital assets, being depreciated/amortized 184,774,346 (14,986,152) - 8,062,653 177,850,847
Total governmental activities capital assets, net 302,609,450$ (6,297,958)$ -$ -$ 296,311,492$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
78
Note 6 – Capital Assets (Continued)
A. Governmental Activities (Continued)
Depreciation and amortization expense was charged to the functions/programs of the governmental activities as
follows:
General government 849,877$
Public safety 1,179,123
Streets 13,341,630
Culture and recreation 254,735
Community services 388,156
Internal service funds 745,952
Total depreciation/amortization expense 16,759,473$
B. Business-Type Activities
The summary of changes in business-type activities capital assets for the year ended June 30, 2019, is as follows:
Balance Balance
July 1, 2018 Additions Deletions June 30, 2019
Capital assets, not being depreciated:
Land and easements 17,624,932$ 5,642,000$ (52,960)$ 23,213,972$
Construction in progress 12,741,571 13,595,002 (18,429,290) 7,907,283
Total capital assets, not being depreciated 30,366,503 19,237,002 (18,482,250) 31,121,255
Capital assets, being depreciated:
Water rights, wells, and pumping 104,282,640 1,688,591 - 105,971,231
Distribution and collection systems 178,321,434 296,360 (42,889) 178,574,905
Building, plant, and store yards 162,779,175 4,549,456 - 167,328,631
Other capital assets 28,253,299 14,811,267 (181,458) 42,883,108
Subtotal 473,636,548 21,345,674 (224,347) 494,757,875
Less accumulated depreciation
Water rights, wells, and pumping (42,946,923) (2,530,288) - (45,477,211)
Distribution and collection systems (54,757,311) (3,620,548) 41,457 (58,336,402)
Building, plant, and store yards (111,950,189) (4,286,061) - (116,236,250)
Other capital assets (19,031,328) (1,462,535) 170,380 (20,323,483)
Subtotal (228,685,751) (11,899,432) 211,837 (240,373,346)
Total capital assets, being depreciated 244,950,797 9,446,242 (12,510) 254,384,529
Total capital assets, net 275,317,300$ 28,683,244$ (18,494,760)$ 285,505,784$
Depreciation expense was charged to the functions/programs of the business-type activities as follows:
Water Enterprise Fund 6,512,869$
Sewer Enterprise Fund 4,313,147
Sewer Collection Enterprise Fund 1,073,416
Total depreciation expense 11,899,432$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
79
Note 7 – Long-Term Liabilities
A. Governmental Activities
A summary of changes in the long-term liabilities of the governmental activities for the year ended June 30, 2019,
is as follows:
Balance Debt Debt Balance Due within Due in More
July 1, 2018 Issued Retired June 30, 2019 One Year Than One Year
Governmental Activities:
Notes payable:
HUD Section 108 - Arden Guthrie 5,256,000$ -$ (454,000)$ 4,802,000$ 494,000$ 4,308,000$
New World Software Agreement 1,236,158 - (609,275) 626,883 626,883 -
Fire Management Association Settlement 900,000 - (300,000) 600,000 300,000 300,000
AMBAC 6,274,512 - (82,102) 6,192,410 168,941 6,023,469
Commerzbank 14,619,635 - (191,299) 14,428,336 393,634 14,034,702
Total notes payable 28,286,305 - (1,636,676) 26,649,629 1,983,458 24,666,171
Lease revenue bonds:
2018 Lease Revenue Refunding Bonds 4,414,002 - (815,642) 3,598,360 846,579 2,751,781
Total lease revenue bonds 4,414,002 - (815,642) 3,598,360 846,579 2,751,781
California Infrastructure and Economic
Development Bank (CIEDB) - Harriman Place
Street Extension Lease 534,311 - (128,077) 406,234 131,676 274,558
Total CIEDB 534,311 - (128,077) 406,234 131,676 274,558
Total 33,234,618$ -$ (2,580,395)$ 30,654,223$ 2,961,713$ 27,692,510$
Classification
HUD Section 108 – Arden Guthrie Focused Neighborhood Revitalization Project Note Payable
The City of San Bernardino entered into a Contract for Loan Guarantee Assistance, a Master Fiscal Agency
Agreement, and executed a promissory note with the United States Department of Housing and Urban Development
pursuant to Section 108 of the Housing and Community Development Act of 1974, as amended (Section 108 Loan).
The proceeds of the loan were then loaned to the EDA to be used for the Arden -Guthrie Focused Neighborhood
Revitalization Project, which affects approximately 20 acres of land located at the northwest corner of Arden
Avenue and 20th Street (Arden-Guthrie Site). Once the Arden-Guthrie Site is sold to a third-party, the proceeds of
the sale are required to be paid to the City. All of the debt service pay ments on the Section 108 Loan are the
responsibility of the City. The source of funds available for the repayment of the Loan is the CDBG Program
Revenue of the City.
Interest payments are due semiannually on February 1 and August 1 at a rate of 2.7% per annum and continue
through August 1, 2026. Principal payments are due annually on August 1, and continue through August 1, 2026.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
80
Note 7 – Long-Term Liabilities (Continued)
A. Governmental Activities (Continued)
HUD Section 108 – Arden Guthrie Focused Neighborhood Revitalization Project Note Payable (Continued)
The annual debt service requirements for the HUD Section 108 – Arden Guthrie note payable outstanding at
June 30, 2019 are as follows:
Year Ending
June 30,Principal Interest Total
2020 494,000$ 257,193$ 751,193$
2021 534,000 229,020 763,020
2022 574,000 198,323 772,323
2023 624,000 164,802 788,802
2024 654,000 128,760 782,760
2025-2027 1,922,000 164,682 2,086,682
Total 4,802,000$ 1,142,780$ 5,944,780$
New World Note Payable
In 2011, the City entered into a subscription agreement for the acquisition of computer software. The agreement
has the substance of a note payable for accounting purposes and has been recorded at the present value of the annual
payments of $645,000, calculated using a discount rate of 2.89%. The final payment is due July 1, 2019.
The annual debt service requirements for the New World note payable outstanding at June 30, 2019 are as follows:
Year Ending
June 30,Principal Interest Total
2020 626,883$ 18,118$ 645,001$
Total 626,883$ 18,118$ 645,001$
Fire Management Association Note Payable
On May 18, 2015, the Mayor and Common Council approved the City Recovery Plan which included numerous
measures to increase revenues and reduce expenditures, including regionalizing or contracting of fire services. In
January 2016, the City reached an agreement with the San Bernardino City Professional Firefighters Union, Local
891, and the San Bernardino County Fire Protection District (“SBCFPD”). The existing operations and remaining
employees of the City Fire Department were transferred to SBCFPD effective July 1, 2016. The transfer agreement
included stipulations for post-transfer salary mitigation amounts to be paid by the City to SBCFPD. In fiscal year
2017, it was determined that the City would pay SBCFPD $1,500,000 in five equal installments of $300,000 for
salary mitigation via a zero interest note payable.
The annual debt service requirements for the Fire Management Association note payable outstanding at
June 30, 2019 are as follows:
Year Ending
June 30,Principal Interest Total
2020 300,000$ -$ 300,000$
2021 300,000 - 300,000
Total 600,000$ -$ 600,000$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
81
Note 7 – Long-Term Liabilities (Continued)
A. Governmental Activities (Continued)
AMBAC Note Payable
In October 2005, the City issued the City of San Bernardino Taxable Pension Obligation Bonds, 2005 Series A.
The City issued the bonds to prepay its unfunded actuarial liability related to the City’s Safety retirement plan. The
City defaulted on the bonds beginning in 2013. The City reached a settlement agreement with the bond creditors
which was confirmed in bankruptcy and became effective June 15, 2017. AMBAC Assurance Corporation was a
bondholder on the original bonds and, via an exchange agreement executed June 15, 2017, agreed to restructure
their claim on the pension obligation bonds to a note payable in the principal amount of $15,217,703 with zero
interest payable in semi-annual installments ranging from $195,195 to $375,375 through December 15, 2046. The
City applied an annual interest rate of 4.92% to the installment payment schedule which resulted in a present value
of the outstanding balance of $6,192,410 at June 30, 2019.
The annual debt service requirements for the AMBAC note payable outstanding at June 30, 2019 are as follows:
Year Ending
June 30,Principal Interest Total
2020 168,941$ 232,710$ 401,651$
2021 173,678 239,234 412,912
2022 173,678 239,234 412,912
2023 173,678 239,234 412,912
2024 173,678 239,234 412,912
2025-2029 907,862 1,250,544 2,158,406
2030-2034 1,026,279 1,413,658 2,439,937
2035-2039 1,184,168 1,631,144 2,815,312
2040-2044 1,421,002 1,957,373 3,378,375
2045-2047 789,446 1,087,430 1,876,876
Total 6,192,410$ 8,529,795$ 14,722,205$
Commerzbank Note Payable
In October 2005, the City issued the City of San Bernardino Taxable Pension Obligation Bonds, 2005 Series A.
The City issued the bonds to prepay its unfunded actuarial liability related to the City’s Safety retirement plan. The
City defaulted on the bonds beginning in 2013. The City reached a settlement agreement with the bond creditors
which was confirmed in bankruptcy and became effective June 15, 2017.
Commerzbank Finance & Covered Bond S.A. was a bondholder on the original bonds and, via an exchange
agreement executed June 15, 2017, agreed to restructure their claim on the pension obligation bonds to a note
payable in the principal amount of $35,457,296 with zero interest payable in semi-annual installments ranging from
$454,805 to $874,625 through December 15, 2046. The City applied an annual interest rate of 4.92% to the
installment payment schedule which resulted in a present value of the outstanding balance of $14,428,336 at
June 30, 2019.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
82
Note 7 – Long-Term Liabilities (Continued)
A. Governmental Activities (Continued)
Commerzbank Note Payable (Continued)
The annual debt service requirements for the Commerzbank note payable outstanding at June 30, 2019 are as
follows:
Year Ending
June 30,Principal Interest Total
2020 393,634$ 542,215$ 935,849$
2021 404,670 557,417 962,087
2022 404,670 557,417 962,087
2023 404,670 557,417 962,087
2024 404,670 557,417 962,087
2025-2029 2,115,322 2,913,772 5,029,094
2030-2034 2,391,234 3,293,829 5,685,063
2035-2039 2,759,116 3,800,572 6,559,688
2040-2044 3,310,939 4,560,686 7,871,625
2045-2047 1,839,411 2,533,714 4,373,125
Total 14,428,336$ 19,874,456$ 34,302,792$
2018 Lease Revenue Refunding Bonds
On January 9, 2018, the City issued $4,414,002 of 2018 Lease Revenue Refunding Bonds to defease and refund on
a current basis, all of the outstanding Lease Revenue Refunding Bonds (City Hall Project), Series 1996 Bonds. The
bonds consist of serial bonds maturing from 2019 through 2023 in annual installments of $991,000 to $994,000.
Interest is due and payable semi-annually at 4.08%. Annual debt service is approximately $990,000 through 2023.
The bonds are subject to federal arbitrage requirements. The aggregate debt service payments of the new debt are
$199,009 less than the old debt. The issuance of the new debt and the refunding of the old debt resulted in an
economic gain (the difference between the net present value of the old debt and new debt service payments) of
approximately $107,423.
The annual debt service requirements of the 2018 Lease Revenue Refunding Bonds outstanding at June 30, 201 9
are as follows:
Year Ending
June 30,Principal Interest Total
2020 846,579$ 146,813$ 993,392$
2021 880,244 112,273 992,517
2022 917,690 76,358 994,048
2023 953,847 38,916 992,763
Total 3,598,360$ 374,360$ 3,972,720$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
83
Note 7 – Long-Term Liabilities (Continued)
A. Governmental Activities (Continued)
California Infrastructure and Economic Development Bank – Harriman Place Extension Lease
On August 28, 2001, the California Infrastructure and Economic Development Bank (CIEDB) and the City entered
into a lease agreement in regard to the Harriman Place Street Extension Project (Project) for an amount of
$2,000,000. Interest rate is 2.81% per annum. The Project is located on real property owned by the City. Subject to
the provisions of the lease, the City agreed to pay to the CIEDB as rental for use and occupancy of the Harriman
Street Extension lease payments on February 1 and August 1 of each year, commencing on August 1, 2004, through
August 1, 2021.
The annual debt service requirements for the Harriman Place Extension Lease outstanding at June 30, 2019 are as
follows:
Year Ending
June 30,Principal Interest Total
2020 131,676$ 9,565$ 141,241$
2021 135,377 5,813 141,190
2022 139,181 1,956 141,137
Total 406,234$ 17,334$ 423,568$
B. Business-Type Activities
A summary of changes in the long-term liabilities of the business-type activities for the year ended June 30, 2019,
is as follows:
Balance Debt Debt Balance Due within Due in More
July 1, 2018 Issued Retired June 30, 2019 One Year Than One Year
Business-Type Activities:
Notes payable:
2016 San Bernardino Valley Municipal
Water District Note 600,000$ -$ (300,000)$ 300,000$ 300,000$ -$
Total notes payable 600,000 - (300,000) 300,000 300,000 -
Bonds payable:
2016 Water Revenue Bonds 47,455,000 - (795,000) 46,660,000 830,000 45,830,000
plus: unamortized bond premium 5,599,748 - (197,638) 5,402,110 - 5,402,110
2016 Sewer Revenue Bonds 33,855,000 - (610,000) 33,245,000 635,000 32,610,000
plus: unamortized bond premium 181,956 - (6,403) 175,553 - 175,553
Total bonds payable 87,091,704 - (1,609,041) 85,482,663 1,465,000 84,017,663
Total 87,691,704$ -$ (1,909,041)$ 85,782,663$ 1,765,000$ 84,017,663$
Classification
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
84
Note 7 – Long-Term Liabilities (Continued)
B. Business-Type Activities (Continued)
2016 San Bernardino Valley Municipal Water District Note
In December 2015, the Department entered into an agreement loan of $1,200,000 with the San Bernardino Valley
Municipal Water District (SBVMWD) for UV System Rehabilitation project improvements to the Rapid Infiltration
and Extraction (RIX) facility owned by the City of Colton and the Department. The note is to be paid in four (4)
yearly installments of $300,000 plus interest at the LAIF interest rate of return.
The annual debt service requirements for the 2016 San Bernardino Valley Municipal Water District note payable
outstanding at June 30, 2019 are as follows:
Year Ending
June 30,Principal Interest Total
2020 300,000$ -$ 300,000$
Total 300,000$ -$ 300,000$
2016 San Bernardino Water Revenue Bonds
The Water Revenue Bonds, Series 2016 (City of San Bernardino Municipal Water Department Water Facilities
Project) (the “2016 Water Bonds”) were issued in the amount of $48,225,000 by the California Municipal Finance
Authority (CMFA) on November 3, 2016. The bonds were issued to finance the acquisition and construction of
certain water system capital improvements of the Water Department, the refund outstanding obligations of the
Water Department, to purchase a Municipal Bond Debt Service Revenue Insurance Policy in satisfaction of the
Reserve Requirement, and to pay the costs of issuance of the 2016 Water Bonds. The repayment of the 2016 Water
Bonds is from a pledge of net revenues of the Water Fund. The principal amount due is reported net of the
unamortized premium of $5,402,110.
The 2016 Water Bonds consist of serial bonds and term bonds. The 2016 serial bonds on the amount of $24,370,000
with varying interest rates from 3.0% to 5.0% per annum. Interest is payable semi -annually on February 1 and
August 1. Serial bonds mature annually on August 1, 2017 through August 1, 2036. Term bonds of $10,500,000
are due on August 1, 2041, term bonds of $10,000,000 are due on August 1, 2046, and term bonds of $3,355,000
are due on August 1, 2046. Interest is payable semi-annually on February 1 and August 1 at rates ranging from
3.5% to 5.0% per annum.
A reserve account is required to be maintained in the amount of $2,994,638. The balance held in the reserve account
as of June 30, 2019 was $2,994,638. At June 30, 2019, $46,660,000 of the bonds were outstanding.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
85
Note 7 – Long-Term Liabilities (Continued)
B. Business-Type Activities (Continued)
2016 San Bernardino Water Revenue Bonds (Continued)
The annual debt service requirements for the 2016 Water Revenue Bonds outstanding at June 30, 2019 are as
follows:
Year Ending
June 30,Principal Interest Total
2020 830,000$ 2,163,888$ 2,993,888$
2021 860,000 2,130,088 2,990,088
2022 900,000 2,090,388 2,990,388
2023 950,000 2,044,138 2,994,138
2024 995,000 1,955,513 2,950,513
2025-2029 5,805,000 9,156,313 14,961,313
2030-2034 7,300,000 7,659,688 14,959,688
2035-2039 9,055,000 5,901,106 14,956,106
2040-2044 11,585,000 3,366,900 14,951,900
2045-2047 8,380,000 593,763 8,973,763
Total 46,660,000$ 37,061,785$ 83,721,785$
Pledged Revenues
The City has pledged future net revenues from the Water Fund for the repayment of all of the Revenue Bonds of
the Water Fund. For the year ended June 30, 2019, total principal and interest paid was $2,991,388, and net
revenues were $15,428,543. The total principal and interest remaining to be paid on the Water Utility Revenue
Bonds are $83,721,785.
Debt Covenants
The Revenue Bonds all require the maintenance of a financial covenant of minimum debt service coverage (DSC)
ratio. The minimum DSC ratio for the bonds is 110% of net system revenues, which are pledged for repayment of
revenue bonds. The DSC ratio is the measure of the Water Fund’s ability to have sufficient resources to pay its debt
service. The Water Fund has met its DSC for the fiscal year ended June 30, 2019, at each measurement.
2016 San Bernardino Sewer Revenue Bonds
The Sewer Revenue Bonds, Series 2016 (City of San Bernardino Sewer Facilities Project) (the “2016 Sewer
Bonds”) were issued in the amount of $34,445,000 by the California Municipal Finance Authority (CMFA) on
December 8, 2016. The bonds were issued to finance the acquisition and construction of additional capital
improvements to the sewer utility. The repayment of the 2016 Sewer Bonds is from a pledge of net revenues of the
Sewer Fund. The principal amount due is reported net of the unamortized premium of $175,553.
The 2016 Sewer Bonds consist of serial bonds and term bonds. The 2016 serial bonds in the amount of $14,510,000
with varying interest rates from 3.0% to 5.0% per annum. Interest is payable semi -annually on February 1 and
August 1. Serial bonds mature annually on August 1, 2017 through August 1, 2033. Term bonds of $2,435,000 are
due on August 1, 2035, term bonds of $2,635,000 are due on August 1, 2037, term bonds of $5,950,000 are due on
August 1, 2041, and term bonds of $8,915,000 are due on April 1, 2046. Interest is payable semi-annually on
February 1 and August 1 at a rate of 4.0% per annum.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
86
Note 7 – Long-Term Liabilities (Continued)
B. Business-Type Activities (Continued)
2016 San Bernardino Sewer Revenue Bonds (Continued)
A reserve account is required to be maintained in the amount of $1,968,962. The balance held in the res erve account
as of June 30, 2019 was $1,968,963. At June 30, 2019, $33,245,000 of the bonds were outstanding.
The annual debt service requirements for the 2016 Sewer Revenue Bonds outstanding at June 30, 2019 are as
follows:
Year Ending
June 30,Principal Interest Total
2020 635,000$ 1,331,225$ 1,966,225$
2021 665,000 1,301,900 1,966,900
2022 700,000 1,267,775 1,967,775
2023 735,000 1,231,900 1,966,900
2024 770,000 1,194,275 1,964,275
2025-2029 4,460,000 5,374,222 9,834,222
2030-2034 5,345,000 4,488,641 9,833,641
2035-2039 6,470,000 3,360,600 9,830,600
2040-2044 7,905,000 1,928,100 9,833,100
2045-2047 5,560,000 339,600 5,899,600
Total 33,245,000$ 21,818,238$ 55,063,238$
Pledged Revenues
The City has pledged future net revenues from the Sewer Fund for the repayment of all of the Revenue Bonds of
the Sewer Fund. For the year ended June 30, 2019, total principal and interest paid was $2,266,900, and net
revenues were $11,354,582. The total principal and interest remaining to be paid on the Water Utility Revenue
Bonds are $55,063,238.
Debt Covenants
The Sewer Revenue Bonds all require the maintenance of a financial covenant of minimum debt service coverage
(DSC) ratio. The minimum DSC ratio for the bonds is 110% of net system revenues, which are pledged for
repayment of revenue bonds. The DSC ratio is the measure of the Water Fund’s ability to have sufficient resources
to pay its debt service. The Water Fund has met its DSC for the fiscal year ended June 30, 2019, at each
measurement.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
87
Note 7 – Long-Term Liabilities (Continued)
C. Fiduciary Fund Financial Statements
A summary of changes in the long-term liabilities of the fiduciary fund financial statements for the year ended
June 30, 2019, is as follows:
Balance Debt Debt Balance Due within Due in More
July 1, 2018 Issued Retired June 30, 2019 One Year Than One Year
Fiduciary Activities:
Notes payable:
HUD Section 108 - Cinema Project 370,000$ -$ (370,000)$ -$ -$ -$
Total notes payable 370,000 - (370,000) - - -
Tax allocation bonds:
Series 1998A, Refunding 3,905,000 - (1,230,000) 2,675,000 1,300,000 1,375,000
Series 2005A, Refunding 24,295,000 - (3,695,000) 20,600,000 3,905,000 16,695,000
Series 2005B, Refunding 8,945,000 - (1,425,000) 7,520,000 1,510,000 6,010,000
Series 2010A 5,090,000 - (260,000) 4,830,000 280,000 4,550,000
Series 2010B 2,035,000 - (115,000) 1,920,000 100,000 1,820,000
Series 2016A, Refunding 24,195,000 - (2,725,000) 21,470,000 2,815,000 18,655,000
Series 2016B, Refunding 13,785,000 - (2,280,000) 11,505,000 2,225,000 9,280,000
Unamortized discount (43,646) - 4,595 (39,051) - (39,051)
Unamortized premium 3,968,185 - (323,779) 3,644,406 - 3,644,406
Total tax allocation bonds 86,174,539 - (12,049,184) 74,125,355 12,135,000 61,990,355
Mortgage revenue bonds:
Highland Senior Housing 1995 885,000 - (85,000) 800,000 90,000 710,000
Casa Ramona Senior Housing 1995 775,000 - (75,000) 700,000 80,000 620,000
Total mortgate revenue bonds 1,660,000 - (160,000) 1,500,000 170,000 1,330,000
Certificates of participation:
1999 Certificates of Participation 3,655,000 - (440,000) 3,215,000 470,000 2,745,000
Total certificates of participation 3,655,000 - (440,000) 3,215,000 470,000 2,745,000
Total 91,859,539$ -$ (13,019,184)$ 78,840,355$ 12,775,000$ 66,065,355$
Classification
HUD Section 108 – Cinema Project Note Payable
The City of San Bernardino EDA and MDA-San Bernardino Associates, LLC (MDA) entered into a HUD Section
108 Loan Agreement in December of 1998. The proceeds of the EDA Loan, together with other sources of funds,
were used and applied by MDA for the payment of the costs of the development, construction, improvement and
financing of a multi-screen cinema complex and related common area improvements. In order for the EDA to be
able to make the loan, the EDA entered into a Contract for Loan Guarantee Assistance, a Master Fiscal Agency
Agreement, and executed promissory notes with the United States of America through its Department of Housing
and Urban Development pursuant to Section 108 of the Housing and Community Development Act of 1974, as
amended.
Interest payments are due semiannually on February 1 and August 1 at a rate of 2.7% per annum through
August 1, 2018. Principal payments are to be made annually on August 1, and continue through August 1, 2018.
As of June 30, 2019, the Cinema Project Note Payable was paid in full.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
88
Note 7 – Long-Term Liabilities (Continued)
C. Fiduciary Fund Financial Statements (Continued)
Tax Allocation Refunding Bonds, Series 1998A
The $19,000,000 of tax allocation refunding bonds, issue of 1998, Series A, consist of serial bonds with varying
interest rates from 3.600% to 5.750% per annum. Interest is payable semiannually on January 1 and July 1. Serial
bonds mature annually on July 1 through July 1, 2020.
The proceeds of the 1998 Series A Tax Allocation Refunding Bonds along with the proceeds of the 1998 Series B
Subordinated Tax Allocation Refunding Bonds were used to advance refund $20,990,000 of outstanding Central
City Project Tax Allocation Refunding Bonds, 1991 Series A and $4,005,000 of outstanding Central City Project
Subordinated Tax Allocation Bonds 1991 Series B.
The Series A bonds are not subject to optional redemption. The bonds are secured by a pledge of property tax
apportionments from the Central City Project Area. In accordance with the bond documents, a reserve account is
required to be maintained in the amount of $1,456,515. The balance held in the reserve account as of June 30, 2019
was $1,456,447. At June 30, 2019, $2,675,000 of the bonds were outstanding.
The annual debt service requirements for the Tax Allocation Refunding Bonds, Series 1998A outstanding at
June 30, 2019 are as follows:
Year Ending
June 30,Principal Interest Total
2020 1,300,000$ 116,438$ 1,416,438$
2021 1,375,000 39,531 1,414,531
Total 2,675,000$ 155,969$ 2,830,969$
Tax Allocation Refunding Bonds, Series 2005A
In September 2005, the San Bernardino Joint Powers Financing Authority issued $55,800,000 in tax allocation
refunding bonds to current refund $55,800,000 of the outstanding 1995A Tax Allocation Refunding Bonds. The
remaining portion of the 1995A Bonds was refunded with the proceeds of the Authority’s Tax Allocation Refunding
Bonds, Series 2005B (see following section). As a result, the 1995A Tax Allocation Refunding Bonds are
considered to be defeased and the liability has been removed from the financial statements. The Series 2005A bonds
consist of serial bonds with varying interest rates from 5.15% to 5.75% per annum. Interest is payable semi-annually
on April 1 and October 1. Serial bonds mature annually on October 1 through October 1, 2025.
The Series 2005A bonds are not subject to optional redemption. The former EDA agreed to pay the Authority
principal and interest payments solely from the EDA's tax revenues from the Central City North, State College
Project No. 4, Southeast Industrial Park, Northwest, South Valle, Uptown, and Tri-City Redevelopment Project
Areas.
A reserve account is required to be maintained in the amount of $5,101,721. The balance held in the reserve account
as of June 30, 2019 was $5,129,403. At June 30, 2019, $20,600,000 of the bonds were outstanding.
The reacquisition price exceeded the net carrying amount of the old debt by $1,116,000. This amount is being netted
against the new debt and being amortized over the life of the new debt. The advance refunding resulted in an
increase in debt service payments over the next 20 years of $18,089 and resulted in an economic gain of $1,940,000
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
89
Note 7 – Long-Term Liabilities (Continued)
C. Fiduciary Fund Financial Statements (Continued)
Tax Allocation Refunding Bonds, Series 2005A (Continued)
The annual debt service requirements for the Tax Allocation Refunding Bonds, Series 2005A outstanding at
June 30, 2019 are as follows:
Year Ending
June 30,Principal Interest Total
2020 3,905,000$ 1,072,231$ 4,977,231$
2021 4,135,000 841,081 4,976,081
2022 2,390,000 653,488 3,043,488
2023 2,525,000 512,181 3,037,181
2024 2,670,000 362,825 3,032,825
2025-2026 4,975,000 289,944 5,264,944
Total 20,600,000$ 3,731,750$ 24,331,750$
Tax Allocation Revenue Refunding Bonds, Series 2005B
In September 2005, the San Bernardino Joint Powers Financing Authority issued $21,105,000 in tax allocation
refunding bonds to current refund $21,105,000 of the outstanding 1995A Tax Allocation Refunding Bonds. The
remaining portion of the 1995A Bonds was refunded with the proceeds of the Authority’s Tax Allocation Refunding
Bonds, Series 2005A (see preceding section). As a result, the 1995A Tax Allocation Refunding Bonds are
considered to be defeased and the liability has been removed from the financial statements.
The Series 2005B bonds consist of serial bonds with varying interest rates from 5.15% to 5.75% per annum. Interest
is payable semi-annually on April 1 and October 1. Serial bonds mature annually on October 1 through
October 1, 2025.
The Series 2005B bonds are not subject to optional redemption. The former EDA agreed to pay the Authority
principal and interest payments solely from the EDA's tax revenues from the Central City North, State College
Project No. 4, Southeast Industrial Park, Northwest, South Valle, Uptown and Tri-City Redevelopment Project
Areas.
A reserve account is required to be maintained in the amount of $1,946,566. The balance held in the reserve account
as of June 30, 2019 was $1,955,529. At June 30, 2019, $7,520,000 of the bonds were outstanding.
The reacquisition price exceeded the net carrying amount of the old debt by $422,100. This amount is being netted
against the new debt and being amortized over the life of the new debt.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
90
Note 7 – Long-Term Liabilities (Continued)
C. Fiduciary Fund Financial Statements (Continued)
Tax Allocation Revenue Refunding Bonds, Series 2005B (Continued)
The annual debt service requirements for the Tax Allocation Refunding Bonds, Series 2005B outstanding at
June 30, 2019 are as follows:
Year Ending
June 30,Principal Interest Total
2020 1,510,000$ 388,988$ 1,898,988$
2021 1,595,000 299,719 1,894,719
2022 820,000 230,288 1,050,288
2023 870,000 181,700 1,051,700
2024 920,000 130,238 1,050,238
2025-2026 1,805,000 105,369 1,910,369
Total 7,520,000$ 1,336,302$ 8,856,302$
Tax Allocation Bonds, Series 2010A
In December 2010, the San Bernardino Joint Powers Financing Authority issued $7,065,000 in tax allocation bonds
to finance certain redevelopment activities of the 4th Street Corridor project, to fund a reserve fund for the bonds,
fund the interest account, and pay all costs of issuance related to the bonds.
The outstanding Series 2010A bonds consist of term bonds of $5,330,000 maturing from April 1, 2018, to
April 1, 2030 in annual installments ranging from $240,000 to $655,000. Term bonds of $1,080,000 are due on
April 1, 2021, and term bonds of $4,250,000 are due on April 1, 2030. Interest is payable semi-annually on April 1
and October 1 at rates ranging from 3.5% to 9.3% per annum.
Term bonds maturing on April 1, 2021, are subject to mandatory prepayment, on each April 1, commencing on
April 1, 2016, through April 1, 2021. Term bonds maturing on April 1, 2030, are subject to mandatory prepayment
on each April 1, commencing on April 1, 2022, through April 1, 2030.
The former EDA agreed to pay the Authority principal and interest payments solely from the Tax Revenues from
the Northwest Redevelopment Project Area.
A reserve account is required to be maintained in the amount of $685,294. The balance held in the reserve account
as of June 30, 2019, was $691,848. At June 30, 2018, $4,830,000 of the bonds were outstanding.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
91
Note 7 – Long-Term Liabilities (Continued)
C. Fiduciary Fund Financial Statements (Continued)
Tax Allocation Bonds, Series 2010A (Continued)
The annual debt service requirements for the Tax Allocation Bonds, Series 2010A outstanding at June 30, 2019 are
as follows:
Year Ending
June 30,Principal Interest Total
2020 280,000$ 436,625$ 716,625$
2021 300,000 415,625 715,625
2022 325,000 393,125 718,125
2023 355,000 363,062 718,062
2024 385,000 330,225 715,225
2025-2029 2,530,000 1,046,638 3,576,638
2030 655,000 60,588 715,588
Total 4,830,000$ 3,045,888$ 7,875,888$
Tax Allocation Bonds, Series 2010B
In January 2011, the San Bernardino Joint Powers Financing Authority issued $3,220,000 in tax allocation bonds
to finance certain redevelopment activities of the Northwest project area, to fund a reserve fund for the bonds, fund
the interest account, and pay all costs of issuance of the bonds.
The outstanding Series 2010B bonds consist of term bonds of $2,160,000 maturing from April 1, 2020, to
April 1, 2028 in annual installments ranging from $25,000 to $690,000. Term bonds of $340,000 are due on
April 1, 2020 and term bonds of $1,820,000 are due on April 1, 2028. Interest is payable annually on April 1 at
rates ranging from 3.0% to 7.0% per annum.
The term bonds maturing in April 2020 are subject to mandatory prepayment, on each April 1, commencing on
April 1, 2013, through April 1, 2020. Term bonds maturing on April 1, 2028, are subject to mandatory prepayment,
on each April 1, commencing on April 1, 2021, through April 1, 2028.
The former EDA agreed to pay the Authority principal and interest payments solely from the EDA's tax revenues
from the Northwest Redevelopment Project Area.
A reserve account is required to be maintained in the amount of $309,888. The balance held in the reserve account
as of June 30, 2019, was $311,153. At June 30, 2019, $1,920,000 of the bonds were outstanding.
The annual debt service requirements for the Tax Allocation Bonds, Series 2010B outstanding at June 30, 2019 are
as follows:
Year Ending
June 30,Principal Interest Total
2020 100,000$ 133,400$ 233,400$
2021 65,000 127,400 192,400
2022 90,000 122,850 212,850
2023 75,000 116,550 191,550
2024 - 111,300 111,300
2025-2028 1,590,000 364,350 1,954,350
Total 1,920,000$ 975,850$ 2,895,850$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
92
Note 7 – Long-Term Liabilities (Continued)
C. Fiduciary Fund Financial Statements (Continued)
Tax Allocation Refunding Bonds, Series 2016A
In March 2016, the Agency issued $27,850,000 in tax-exempt tax allocation refunding bonds in order to refund the
outstanding balances, as of April 1, 2016, of the CMB Infrastructure Investment Group Notes Payable, the Tax
Allocation Bonds, Series 2002A, and the Tax Allocation Refunding Bonds, Series 2002, to purchase a Municipal
Bond Debt Service Reserve Insurance Policy for deposit in the reserve account, and to pay certain costs of issuance.
The Series 2016A bonds consist of $24,925,000 in serial bonds, which mature on December 1 each year from 2017
through 2025 in amounts ranging from $2,310,000 to $3,900,000, and $1,945,000 of term bonds maturing on
December 1, 2031. Interest is paid semi-annually on June 1 and December 1 at interest rates ranging from 2 .0% to
5.0% per annum.
The Series 2016A bonds are payable from, and secured by, the tax revenues deposited in the Redevelopment
Property Tax Trust Fund. The aggregate debt service payments of the new debt are $9,381,967 less than the old
debt. The issuance of the new debt and refunding of the old debt resulted in an economic gain (the difference
between the net present value of the old debt and new debt service payments) of approximately $10,028,205.
A reserve account is required to be maintained in the amount of $5,241,569. As of June 30, 2019, the reserve
requirement was met through the City’s purchase of a Surety policy in-lieu of the cash reserve requirement. At
June 30, 2019, $21,470,000 of the bonds were outstanding.
The annual debt service requirements for the Tax Allocation Refunding Bonds, Series 2016A outstanding at
June 30, 2019 are as follows:
Year Ending
June 30,Principal Interest Total
2020 2,815,000$ 989,050$ 3,804,050$
2021 2,915,000 859,875 3,774,875
2022 3,900,000 689,500 4,589,500
2023 2,310,000 534,250 2,844,250
2024 2,425,000 415,875 2,840,875
2025-2029 6,430,000 604,750 7,034,750
2030-2032 675,000 62,125 737,125
Total 21,470,000$ 4,155,425$ 25,625,425$
Tax Allocation Refunding Bonds, Series 2016B
In March 2016, the Agency issued $16,030,000 in federally taxable tax allocation refunding bonds in order to refund
the outstanding balances, as of April 1, 2016, of the Tax Allocation Bonds, Series 1998B and Tax Allocation Bonds,
Taxable Series 2006, to purchase a Municipal Bond Debt Service Reserve Insurance Policy for deposit in the reserve
account, and to pay certain costs of issuance.
The Series 2016B bonds consist of $12,015,000 in serial bonds, which mature on December 1 each year from 2017
through 2022 in amounts ranging from $815,000 to $2,780,000, and $1,700,000 and $2,315,000 of term bonds
maturing on December 1, 2024 and December 1, 2027, respectively. Interest is paid semi-annually on June 1 and
December 1 at interest rates ranging from 1.75% to 4.05% per annum.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
93
Note 7 – Long-Term Liabilities (Continued)
C. Fiduciary Fund Financial Statements (Continued)
Tax Allocation Refunding Bonds, Series 2016B (Continued)
The Series 2016B bonds are payable from, and secured by, the tax revenues deposited in the Redevelopment
Property Tax Trust Fund. The aggregate debt service payments of the new debt are $5,514,666 less than the old
debt. The issuance of the new debt and refunding of the old debt resulted in an econ omic gain (the difference
between the net present value of the old debt and new debt service payments) of approximately $5,072,654.
A reserve account is required to be maintained in the amount of $5,241,569. As of June 30, 2019, the reserve
requirement was met through the City’s purchase of a Surety policy in-lieu of the cash reserve requirement. At
June 30, 2019, $11,505,000 of the bonds were outstanding.
The annual debt service requirements for the Tax Allocation Bonds, Series 2016B outstanding at June 30, 2019 are
as follows:
Year Ending
June 30,Principal Interest Total
2020 2,225,000$ 327,955$ 2,552,955$
2021 2,780,000 264,768 3,044,768
2022 1,670,000 203,230 1,873,230
2023 815,000 165,140 980,140
2024 835,000 137,488 972,488
2025-2028 3,180,000 243,838 3,423,838
Total 11,505,000$ 1,342,419$ 12,847,419$
Highland Senior Housing 1995 Mortgage Revenue Bonds
The Multifamily Housing Revenue Bonds 1995 Series (Highland Lutheran Senior Housing Project) were issued on
June 29, 1995 for $1,710,000. The mortgage revenue bonds are special obligations payable solely from payments
made on and secured by a pledge of the acquired mortgage loans and certain reserve funds and other monies in
connection therewith, all pledged under the resolution authorizing the issuance of the bonds. The Bonds shall mature
on July 1, 2025 and shall bear interest at the rate of 7.625% per annum. Interest is payable semi-annually on July 1
and January 1. The bonds are payable from revenues or assets of the EDA. Multifamily Housing Revenue Bonds
(Highland Lutheran Senior Housing Project) 1995 Series mortgage revenue bonds outstanding as of June 30, 2019
are $800,000.
The annual debt service requirements for the Highland Senior Housing Mortgage Revenue bonds outstanding at
June 30, 2019 are as follows:
Year Ending
June 30,Principal Interest Total
2020 90,000$ 57,569$ 147,569$
2021 95,000 50,516 145,516
2022 105,000 42,891 147,891
2023 115,000 34,503 149,503
2024 120,000 25,544 145,544
2025-2026 275,000 21,541 296,541
Total 800,000$ 232,564$ 1,032,564$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
94
Note 7 – Long-Term Liabilities (Continued)
C. Fiduciary Fund Financial Statements (Continued)
Casa Ramona Senior Housing 1995 Mortgage Revenue Bonds
The Multifamily Housing Revenue Bonds 1995 Series (Casa Ramona Senior Housing Complex Project) were
issued on June 29, 1995 for $1,500,000. The mortgage revenue bonds are special obligations payable solely from
payments made on and secured by a pledge of the acquired mortgage loans and certain reserve funds and other
monies in connection therewith, all pledged under the resolution author izing the issuance of the bonds. The Bonds
shall mature on July 1, 2025 and shall bear interest at the rate of 7.875% per annum. Interest is payable semi-
annually on July 1 and January 1. The bonds are payable from revenues or assets of the EDA. Multifamily Housing
Revenue Bonds (Casa Ramona Senior Housing Project) 1995 Series mortgage revenue bonds outstanding as of
June 30, 2019 are $700,000.
The annual debt service requirements for the Casa Ramona Senior Housing 1995 Mortgage Revenue bonds
outstanding at June 30, 2019 are as follows:
Year Ending
June 30,Principal Interest Total
2020 80,000$ 51,975$ 131,975$
2021 85,000 45,478 130,478
2022 90,000 38,588 128,588
2023 100,000 31,106 131,106
2024 105,000 23,034 128,034
2025-2026 240,000 19,294 259,294
Total 700,000$ 209,475$ 909,475$
1999 Certificates of Participation
On September 23, 1999, the San Bernardino Joint Powers Financing Authority issued $15,480,000 of Refunding
Certificates of Participation (Certificates). The Certificates were issued to retire $2,325,000 outstanding of
Refunding Certificates of Participation (South Valle Public Improvement Project) dated April 1, 1987, and
$5,910,000 outstanding of Certificates of Participation (1995 Police Station Financing Project) dated
April 1, 1995, and to provide funds for capital improvements (201 Building Projects).
The Certificates mature on September 1 of each year through September 1, 2024, in amounts ranging from
$420,000 to $1,080,000. The interest represented by the Certificates is calculated on the basis of a 360 -day year
of twelve 30-day months, from September 1, 1999, at the rates per annum set forth in the bond documents and
will represent the sum of the portions of the lease payments design ated as interest coming due during the six
months preceding each interest payment date. The interest rates will range approximately from 3.70% to 5.50%
per annum.
The Certificates maturing on September 1, 2020, are subject to mandatory si nking fund redemption in part on
September 1 in each year on or after September 1, 2010, from the principal components of the lease payments
required to be paid by the City pursuant to the Lease Agreements with respect to each such redemption date, at a
redemption price equal to the principal amount thereof to be redeemed, together with interest accrued thereon to
the date fixed for redemption, without premium, in accordance with the terms identified in the bond documents.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
95
Note 7 – Long-Term Liabilities (Continued)
D. Fiduciary Activities
1999 Certificates of Participation (Continued)
The Certificates maturing on September 1, 2024, are subject to mandatory sinking fund redemption in part on
September 1, 2021, from the principal components of the lease payments required to be paid by the City pursuant
to the Lease Agreements with respect to each such redemption date, at a redemption price equal to the principal
amount thereof to be redeemed, together with interest accrued thereon to the date fixed for re demption, without
premium, in accordance with the terms identified in the bond documents.
The Certificates represent direct, undivided fractional interest in lease payments to be made by the City under
the lease agreements. A reserve fund is required to b e maintained in an amount equal to the maximum annual
debt service. At June 30, 2019, the reserve requirement was $648,430 and the amount actually held in the reserve
account was $652,208. The total outstanding balan ce of the Certificates at June 30, 2019, was $3,215,000, which
is the portion of the Certificates that represent the South Valle Refunding and 201 Building Projects. Repayments
of these portions of the Certificates are funded from the Redevelopment Property Tax Trust Fund, as a result of
the dissolution of the redevelopment agency. The Certificates that represent the Police Station portion , were
defeased during the fiscal year ended June 30, 2017 .
The annual debt service requirements for the 1999 Certificates of Participation outstanding at June 30, 2019 are as
follows:
Year Ending
June 30,Principal Interest Total
2020 470,000$ 163,900$ 633,900$
2021 490,000 137,500 627,500
2022 520,000 109,725 629,725
2023 545,000 80,438 625,438
2024 580,000 49,500 629,500
2025 610,000 16,775 626,775
Total 3,215,000$ 557,838$ 3,772,838$
Note 8 – Compensated Absences
City employees receive between 10 and 25 vacation days each year depending upon length of service. An employee
may accumulate earned vacation time to a maximum not to exceed 60 days. Upon termination, employees are paid the
full value of their unused vacation time determined at their present salary rate. City employees receive 12 personal
necessity/sick leave days each year. Upon separation from the City, employees having six or more years of service can
convert unused sick leave to a post-employment health care plan or a 401(a) retirement plan as follows: 288 hours or
fewer accrued = 0; 289-479 hours accrued = 20% of accrued sick leave; 480-959 hours = 25%; 960 hours or more =
35%.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
96
Note 8 – Compensated Absences (Continued)
A. Governmental Activities
A summary of changes in the compensated absences balances for the governmental activities for the year ended
June 30, 2019 is as follows:
Balance Balance Due within Due in More
July 1, 2018 Additions Deletions June 30, 2019 One Year Than One Year
Compensated absences 4,861,450$ 8,185,028$ (7,828,703)$ 5,217,775$ 1,565,333$ 3,652,442$
Total 4,861,450$ 8,185,028$ (7,828,703)$ 5,217,775$ 1,565,333$ 3,652,442$
Classification
Compensated absences in the governmental activities are obligations of the following funds:
Governmental Funds 4,998,707$
Workers Compensation 11,364
Liability Insurance 11,934
Motorpool 60,347
Information Systems 135,423
Total 5,217,775$
B. Business-Type Activities
A summary of changes in the compensated absences balances for the business-type activities for the year ended
June 30, 2019 is as follows:
Balance Balance Due within Due in More
July 1, 2018 Additions Deletions June 30, 2019 One Year Than One Year
Compensated absences 1,244,706$ 2,058,957$ (1,923,214)$ 1,380,449$ 1,102,497$ 277,952$
Total 1,244,706$ 2,058,957$ (1,923,214)$ 1,380,449$ 1,102,497$ 277,952$
Classification
Compensated absences in the business-type activities are obligations of the following funds:
Water Fund 992,223$
Sewer Fund 363,589
Sewer Collection Fund 20,911
Integrated Waste Fund 3,726
Total 1,380,449$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
97
Note 8 – Compensated Absences (Continued)
C. Fiduciary Fund Financial Statements
A summary of changes in the compensated absences balances for the fiduciary fund financial statements for the
year ended June 30, 2019 is as follows:
Balance Balance Due within Due in More
July 1, 2018 Additions Deletions June 30, 2019 One Year Than One Year
Compensated absences 107,939$ 15,695$ (10,924)$ 112,710$ 112,710$ -$
Total 107,939$ 15,695$ (10,924)$ 112,710$ 112,710$ -$
Classification
All compensated absences liabilities in the fiduciary fund financial statements belong to the Redevelopment
Obligation Retirement Fund (Successor Agency).
Note 9 – Claims and Judgments Payable
The City of San Bernardino is self-insured for its liability, unemployment and long-term disability programs. The
accrued liability for estimated claims represents an estimate of the eventual loss on claims arising prior to year-end
including claims incurred but not yet reported and estimates of loss adjustment expense.
For liability claims, the City is self-insured for the first $1 million. In addition, the City has obtained excess liability
coverage using a tiered system with three carriers totaling $30 million per occurrence.
The City is a member of the CSAC Excess Insurance Authority (the Authority) for its workers’ compensation claims.
For these claims, the City is self-insured for the first $1 million. Excess coverage is currently maintained by the
Authority for worker’s compensation for coverage in excess of the City’s self-insured retention of $1 million, with
limits of $50 million
Settled claims for general liability and workers’ compensation have not exceeded insurance coverage during the past
three years.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
98
Note 9 – Claims and Judgments Payable (Continued)
A. Governmental Activities
Changes in the general liability claims liability for the governmental activities for the years ended June 30, 2019,
2018, and 2017, are as follows:
Beginning of Prior Claims and Balance at
Fiscal Year Period Changes in Claims Fiscal Year
Liability Adjustment Estimates Payments End
2016-2017 14,360,983$ (12,456,931)$ 6,216,638$ (275,289)$ 7,845,401$
2017-2018 7,845,401 - 1,490,799 (4,164,456) 5,171,744
2018-2019 5,171,744 - 2,905,525 (2,067,649) 6,009,620
Changes in the workers’ compensation claims liability for the governmental activities for the years ended
June 30, 2019, 2018, and 2017, are as follows:
Beginning of Claims and Balance at
Fiscal Year Changes in Claims Fiscal Year
Liability Estimates Payments End
2016-2017 29,856,479$ 739,829$ (5,963,659)$ 24,632,649$
2017-2018 24,632,649 4,985,843 (6,655,289) 22,963,203
2018-2019 22,963,203 3,002,819 (3,644,906) 22,321,116
B. Business-Type Activities
Changes in the workers’ compensation claims liability for the business-type activities for the years ended
June 30, 2019, 2018, and 2017, are as follows:
Beginning of Claims and Balance at
Fiscal Year Changes in Claims Fiscal Year
Liability Estimates Payments End
2016-2017 1,294,506$ 1,409,298$ (293,201)$ 2,410,603$
2017-2018 2,410,603 2,608,114 (2,131,740) 2,886,977
2018-2019 2,886,977 (197,045) - 2,689,932
The City maintains third party insurance coverage for general liability claims in business-type activities.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
99
Note 10 – Pension Plans
A. Summary
Net Pension Liability
Net Pension Liability is reported in the accompanying statements of net position as follows:
Miscellaneous Safety Miscellaneous
Plan -53 Plan - 54 Plan - 1414 Total
Governmental Activities (minus
Internal Service Funds)87,038,220$ 257,405,872$ -$ 344,444,092$
Internal Service Funds:
Workers' Compensation 960,241 - - 960,241
Liability Insurance 1,000,672 - - 1,000,672
Motorpool 3,881,393 - - 3,881,393
Information Systems 8,197,422 - - 8,197,422
Total Internal Service Funds 14,039,728 - - 14,039,728
Total Governmental Activities 101,077,948 257,405,872 - 358,483,820
Business-Type funds:
Water Utility 28,228,907 - - 28,228,907
Sewer Utility 21,268,618 - - 21,268,618
Sewer Collection Utility 7,358,821 - - 7,358,821
Total Business-Type funds 56,856,346 - - 56,856,346
Successor Agency Trust Fund - - 6,269,392 6,269,392
Total 157,934,294$ 257,405,872$ 6,269,392$ 421,609,558$
Deferred Outflows of Resources
Deferred Outflows of Resources are reported in the accompanying statements of net position as follows:
Pension Contributions Made after the Measurement Date
Miscellaneous Safety Miscellaneous
Plan -53 Plan - 54 Plan - 1414 Total
Governmental Activities (minus
Internal Service Funds)7,422,465$ 19,556,883$ -$ 26,979,348$
Internal Service Funds:
Workers' Compensation 81,888 - - 81,888
Liability Insurance 85,336 - - 85,336
Motorpool 330,998 - - 330,998
Information Systems 699,062 - - 699,062
Total Internal Service Funds 1,197,284 - - 1,197,284
Total Governmental Activities 8,619,749 19,556,883 - 28,176,632
Business-Type funds:
Water Utility 2,607,463 - - 2,607,463
Sewer Utility 1,964,551 - - 1,964,551
Sewer Collection Utility 679,724 - - 679,724
Total Business-Type funds 5,251,738 - - 5,251,738
Successor Agency Trust Fund - - 410,556 410,556
Total 13,871,487$ 19,556,883$ 410,556$ 33,838,926$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
100
Note 10 – Pension Plans (Continued)
A. Summary (Continued)
Deferred Outflows of Resources (Continued)
Investments
Miscellaneous Safety Miscellaneous
Plan -53 Plan - 54 Plan - 1414 Total
Governmental Activities (minus
Internal Service Funds)589,038$ 1,351,441$ -$ 1,940,479$
Internal Service Funds:
Workers' Compensation 6,498 - - 6,498
Liability Insurance 6,772 - - 6,772
Motorpool 26,268 - - 26,268
Information Systems 55,477 - - 55,477
Total Internal Service Funds 95,015 - - 95,015
Total Governmental Activities 684,053 1,351,441 - 2,035,494
Business-Type funds:
Water Utility 191,041 - - 191,041
Sewer Utility 143,937 - - 143,937
Sewer Collection Utility 49,801 - - 49,801
Total Business-Type funds 384,779 - - 434,580
Successor Agency Trust Fund - - 30,994 30,994
Total 1,068,832$ 1,351,441$ 30,994$ 2,501,068$
Difference between Expected and Actual Experience
Miscellaneous Safety Miscellaneous
Plan -53 Plan - 54 Plan - 1414 Total
Governmental Activities (minus
Internal Service Funds)-$ 3,370$ -$ 3,370$
Internal Service Funds:
Workers' Compensation - - - -
Liability Insurance - - - -
Motorpool - - - -
Information Systems - - - -
Total Internal Service Funds - - - -
Total Governmental Activities - 3,370 - 3,370
Business-Type funds:
Water Utility - - - -
Sewer Utility - - - -
Sewer Collection Utility - - - -
Total Business-Type funds - - - -
Successor Agency Trust Fund - - 158,689 158,689
Total -$ 3,370$ 158,689$ 162,059$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
101
Note 10 – Pension Plans (Continued)
A. Summary (Continued)
Deferred Outflows of Resources (Continued)
Change in Assumptions
Miscellaneous Safety Miscellaneous
Plan -53 Plan - 54 Plan - 1414 Total
Governmental Activities (minus
Internal Service Funds)-$ 14,965,850$ -$ 14,965,850$
Internal Service Funds:
Workers' Compensation - - - -
Liability Insurance - - - -
Motorpool - - - -
Information Systems - - - -
Total Internal Service Funds - - - -
Total Governmental Activities - 14,965,850 - 14,965,850
Business-Type funds:
Water Utility - - - -
Sewer Utility - - - -
Sewer Collection Utility - - - -
Total Business-Type funds - - - -
Successor Agency Trust Fund - - 539,563 539,563
Total -$ 14,965,850$ 539,563$ 15,505,413$
Total Pension-Related Deferred Outflows
Miscellaneous Safety Miscellaneous
Plan -53 Plan - 54 Plan - 1414 Total
Governmental Activities (minus
Internal Service Funds)8,011,503$ 35,877,544$ -$ 43,889,047$
Internal Service Funds:
Workers' Compensation 88,386 - - 88,386
Liability Insurance 92,108 - - 92,108
Motorpool 357,266 - - 357,266
Information Systems 754,539 - - 754,539
Total Internal Service Funds 1,292,299 - - 1,292,299
Total Governmental Activities 9,303,802 35,877,544 - 45,181,346 - - - -
Business-Type funds:
Water Utility 2,798,504 - - 2,798,504
Sewer Utility 2,108,488 - - 2,108,488
Sewer Collection Utility 729,525 - - 729,525
Total Business-Type funds 5,636,517 - - 5,636,517 - - -
Successor Agency Trust Fund - - 1,139,802 1,139,802 - - -
Total 14,940,319$ 35,877,544$ 1,139,802$ 51,957,665$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
102
Note 10 – Pension Plans (Continued)
A. Summary (Continued)
Deferred Inflows of Resources
Deferred Inflows of Resources are reported in the accompanying statements of net position as follows:
Difference between Expected and Actual Experience
Miscellaneous Safety Miscellaneous
Plan -53 Plan - 54 Plan - 1414 Total
Governmental Activities (minus
Internal Service Funds)436,702$ 2,381,782$ -$ 2,818,484$
Internal Service Funds:
Workers' Compensation 4,818 - - 4,818
Liability Insurance 5,021 - - 5,021
Motorpool 19,474 - - 19,474
Information Systems 41,129 - - 41,129
Total Internal Service Funds 70,442 - - 70,442
Total Governmental Activities 507,144 2,381,782 - 2,888,926
Business-Type funds:
Water Utility 141,635 - - 141,635
Sewer Utility 106,712 - - 106,712
Sewer Collection Utility 36,922 - - 36,922
Total Business-Type funds 285,269 - - 285,269
Successor Agency Trust Fund - - - -
Total 792,413$ 2,381,782$ -$ 3,174,195$
Changes in Assumptions
Miscellaneous Safety Miscellaneous
Plan -53 Plan - 54 Plan - 1414 Total
Governmental Activities (minus
Internal Service Funds)755,672$ 2,061,719$ -$ 2,817,391$
Internal Service Funds:
Workers' Compensation 8,337 - - 8,337
Liability Insurance 8,688 - - 8,688
Motorpool 33,699 - - 33,699
Information Systems 71,171 - - 71,171
Total Internal Service Funds 121,895 - - 121,895
Total Governmental Activities 877,567 2,061,719 - 2,939,286
Business-Type funds:
Water Utility 245,086 - - 245,086
Sewer Utility 184,656 - - 184,656
Sewer Collection Utility 63,890 - - 63,890
Total Business-Type funds 493,632 - - 493,632
Successor Agency Trust Fund - - - -
Total 1,371,199$ 2,061,719$ -$ 3,432,918$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
103
Note 10 – Pension Plans (Continued)
A. Summary (Continued)
Deferred Inflows of Resources (Continued)
Difference between Actual and Proportionate Share of Employers Contributions
Miscellaneous Safety Miscellaneous
Plan -53 Plan - 54 Plan - 1414 Total
Governmental Activities (minus
Internal Service Funds)-$ -$ -$ -$
Internal Service Funds:
Workers' Compensation - - - -
Liability Insurance - - - -
Motorpool - - - -
Information Systems - - - -
Total Internal Service Funds - - - -
Total Governmental Activities - - - -
Business-Type funds:
Water Utility - - - -
Sewer Utility - - - -
Sewer Collection Utility - - - -
Total Business-Type funds - - - -
Successor Agency Trust Fund - - 347,478 347,478
Total -$ -$ 347,478$ 347,478$
Differences in Proportions
Miscellaneous Safety Miscellaneous
Plan -53 Plan - 54 Plan - 1414 Total
Governmental Activities (minus
Internal Service Funds)-$ -$ -$ -
Internal Service Funds:
Workers' Compensation - - - -
Liability Insurance - - - -
Motorpool - - - -
Information Systems - - - -
Total Internal Service Funds - - - -
Total Governmental Activities - - - -
Business-Type funds:
Water Utility - - - -
Sewer Utility - - - -
Sewer Collection Utility - - - -
Total Business-Type funds - - - -
Successor Agency Trust Fund - - 237,446 237,446
Total -$ -$ 237,446$ 237,446$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
104
Note 10 – Pension Plans (Continued)
A. Summary (Continued)
Deferred Inflows of Resources (Continued)
Total Pension-Related Deferred Inflows
Miscellaneous Safety Miscellaneous
Plan -53 Plan - 54 Plan - 1414 Total
Governmental Activities (minus
Internal Service Funds)1,192,374$ 4,443,501$ -$ 5,635,875$
Internal Service Funds:
Workers' Compensation 13,155 - - 13,155
Liability Insurance 13,709 - - 13,709
Motorpool 53,173 - - 53,173
Information Systems 112,300 - - 112,300
Total Internal Service Funds 192,337 - - 192,337
Total Governmental Activities 1,384,711 4,443,501 - 5,828,212
Business-Type funds:
Water Utility 386,721 - - 386,721
Water Utility 291,368 - - 291,368
Sewer Utility 100,812 - - 100,812
Total Business-Type funds 778,901 - - 778,901
Successor Agency Trust Fund - - 584,924 584,924
Total 2,163,612$ 4,443,501$ 584,924$ 7,192,037$
B. City Plans
Plan Description
Substantially all City employees working the equivalent of 1,000 hours per fiscal year are eligible to participate in
the Safety Plan and Miscellaneous Plan Agent multiple-employer defined benefit plans administered by California
Public Employees Retirement System (CalPERS), which acts as a common investment and administrative agent for
its participating member employers. Benefit Provisions under the Plans are established by State statutes within the
Public Employee’s Retirement Law. CalPERS issues publicly available reports that include a full description of the
pension plans regarding benefit provisions, assumptions and membership informati on that can be found on the
CalPERS website. Copies of the CalPERS annual financial report may be obtained from the CalPERS Executive
Office – 400 P Street, Sacramento, CA 95814.
Benefits Provided
CalPERS provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan
members and beneficiaries. A classic CalPERS member becomes eligible for service retirement upon attainment of
age 55 with at least 5 years of credited service.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
105
Note 10 – Pension Plans (Continued)
B. City Plans (Continued)
Benefits Provided (Continued)
CalPERS California Public Employees’ Pension Reform Act (PEPRA) members become eligible for service
retirement upon attainment of age 62 with at least 5 years of service. The service retirement benefit is a monthly
allowance equal to the product of the benefit factor, years of service, and final compensation. The final
compensation is the monthly average of the member's highest 36 or 12 consecutive months' fulltime equivalent
monthly pay. Retirement benefits for classic miscellaneous employees are calculated as 2% to 2.7% of the average
final 12 months compensation. Retirement benefits for PEPRA miscellaneous employees are calculated as 2% of
the average final 36 months compensation. Retirement benefits for classic safety employees are calculated as 3% of
the average final 12 months compensation. Retirement benefits for PEPRA safety employees are calculated as 2.7%
of the average final 36 months compensation.
Participant is eligible for nonindustrial disability retirement if becomes disabled and has at least 5 years of credited
service. There is no special age requirement. The standard nonindustrial disability retirement benefit is a monthly
allowance equal to 1.8% of final compensation, multiplied by service.
Industrial disability benefits are not offered to miscellaneous employees. The City provides industrial disability
retirement benefit to safety employees. The industrial disability retirement benefit is a monthly allowance equal to
50% of final compensation.
An employee's beneficiary may receive the basic death benefit if the employee dies while actively employed. The
employee must be actively employed with the City to be eligible for this benefit. An employee's survivor who is
eligible for any other pre-retirement death benefit may choose to receive that death benefit instead of this basic
death benefit. The basic death benefit is a lump sum in the amount of the employee's accumulated contributions,
where interest is currently credited at 7.5% per year, plus a lump sum in the amount of one month's salary for each
completed year of current service, up to a maximum of six months' salary. For purposes of this benefit, one month's
salary is defined as the member's average monthly full-time rate of compensation during the 12 months preceding
death.
Upon the death of a retiree, a one-time lump sum payment of $500 will be made to the retiree's designated
survivor(s), or to the retiree's estate.
Benefit terms provide for annual cost-of-living adjustments to each employee’s retirement allowance. Beginning
the second calendar year after the year of retirement, retir ement and survivor allowances will be annually adjusted
on a compound basis by 2%.
Employees Covered
At June 30, 2018, the measurement date, the following employees were covered by the benefit terms for each Plan:
Miscellaneous Safety
Active employees 654 241
Transferred and terminated employees 976 219
Retired employees and benificiaries 1477 730
Total 3107 1190
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
106
Note 10 – Pension Plans (Continued)
B. City Plans (Continued)
Contributions
Section 20814(c) of the California Public Employees’ Retirement Law (“PERL”) requires that the employer
contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective
on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’
annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the
costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued
liability. The employer is required to contribute the difference between the actuarially determined rate and the
contribution rate of employees. For the year ended June 30, 2019, the average active miscellaneous and safety
employee contribution rates were 7.614% and 9.254% of annual pay, respectively, and the employer’s contribution
rates were 10.172% and 19.242% of miscellaneous and safety employee annual payroll, respectively.
For the year ended June 30, 2019, the plan’s contributions made for each Plan was as follows:
Miscellaneous Safety Aggregate Total765345
Contributions - employer 13,871,487$ 19,556,883$ 33,428,370$
Net Pension Liability
The City’s net pension liability is measured as the total pension liability, less the pension plan’s fiduciary net
position. The net pension liability of the Plan is measured as of June 30, 2018, using an annual actuarial valuation
as of June 30, 2017 rolled forward to June 30, 2018 using standard update procedures. A summary of principal
assumptions and methods used to determine the net pension liability is shown on the following page.
Actuarial Assumptions
The total pension liabilities in the June 30, 2017 actuarial valuations were determined using the following actuarial
assumptions:
Actuarial Cost Method
Actuarial Assumptions:
Discount Rate
Inflation
Salary Increases
Investment Rate of Return
Mortality Rate Table
Post Retirement Benefit Increase
7.50%
Derived using CalPERS’ Membership Data for all Funds.
Contract COLA up to 2.75%until Purchasing Power Protection Allowance Floor on Purchasing
Power applies, 2.75% thereafter
Entry Age Normal in accordance with the requirement of GASB Statement No. 68
7.15%
2.75%
Varies by Entry Age and Service
The underlying mortality assumptions and all other actuarial assumptions used in the June 30, 2017 valuation were
based on the results of a January 2015 actuarial experience study for the period 1997 to 2011. Further details of the
Experience Study can be found on the CalPERS website.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
107
Note 10 – Pension Plans (Continued)
B. City Plans (Continued)
Discount Rate
In determining the long-term expected rate of return, CalPERS took into account, both short-term and long-term
market return expectations as well as the expected pension fund cash flows. Such cash flows were developed
assuming that both members and employers will make their required contributions on time and as scheduled in all
future years. Using historical returns of all the funds’ asset classes, expected compound (geometric) returns were
calculated over the short-term (first 10 years) and the long-term (11-60 years) using a building-block approach.
Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated
for each fund. The expected rate of return was set by calculating the single equivalent expected return that arrived
at the same present value of benefits for cash flows as the one calculated using both short-term and long-term
returns. The expected rate of return was then set equivalent to the single equivalent rate calculated above and
rounded down to the nearest one quarter of one percent.
The table below reflects long-term expected real rate of return by asset class. The rate of return was calculated using
the capital market assumptions applied to determine the discount rate and asset allocation. These geometric rates of
return are net of administrative expenses.
Asset Class New Strategic Allocation Real Return Years 1 - 10 1 Real Return Years 11 + 2
Global equity 50.00%4.80%5.98%
Global fixed income 28.00%1.00%2.62%
Inflation sensitive assets 0.00%0.77%1.81%
Private equity 8.00%6.30%7.23%
Real assets 13.00%3.75%4.93%
Liquidity 1.00%0.00%-0.92%
1 An expected inflation of 2.00% was used for this period.
2 An expected inflation of 2.92% was used for this period.
The discount rate used to measure the total pension liability was 7.15% for the plan. To determine whether the
municipal bond rate should be used in the calculation of a discount rate for each plan, CalPERS stress tested plans
that would most likely result in a discount rate that would be different from the actuarially assumed discount rate.
Based on the testing, none of the tested plans run out of assets. Therefore, the current 7.15% discount rate is adequate
and the use of the municipal bond rate calculation is not necessary. The long term expected discount rate of 7.15%
is applied to all plans in the Public Employees Retirement Fund (PERF). The stress test results are presented in a
detailed report called “GASB Crossover Testing Report” that can be obtained from the CalPERS website under the
GASB 68 Section.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
108
Note 10 – Pension Plans (Continued)
B. City Plans (Continued)
Changes in the Net Pension Liability
The following table shows the changes in net pension liability recognized over the measurement period:
Total Pension
Liability
Plan Fiduciary Net
Position Net Pension Liability
Balance at June 30, 2017 (Valuation Date)560,927,881$ 398,163,785$ 162,764,096
Changes in the year:
Service cost 6,941,229 - 6,941,229
Interest on the total pension liabilities 38,956,825 - 38,956,825
Changes in assumptions (2,617,743) - (2,617,743)
Differences between expected and actual experience (1,512,789) - (1,512,789)
Benefit payments, including refunds of members contributions (30,834,523) (30,834,523) -
Plan to plan resource movement - (10,306) 10,306
Contributions - employer - 11,868,160 (11,868,160)
Contributions - employee - 3,003,123 (3,003,123)
Net investment income - 33,535,039 (33,535,039)
Administrative expenses - (1,798,692) 1,798,692
Net changes 10,932,999 15,762,801 (4,829,802)
Balance at June 30, 2018 (Measurement Date)571,860,880$ 413,926,586$ 157,934,294$
Miscellaneous Plan
Total Pension
Liability
Plan Fiduciary Net
Position Net Pension Liability
Balance at June 30, 2017 (Valuation Date)781,691,149$ 521,384,938$ 260,306,211$
Changes in the year:
Service cost 7,839,902 - 7,839,902
Interest on the total pension liabilities 54,332,493 - 54,332,493
Changes in assumptions (652,443) - (652,443)
Differences between expected and actual experience (3,779,819) - (3,779,819)
Benefit payments, including refunds of members contributions (42,567,625) (42,567,625) -
Plan to plan resource movement - 8,082 (8,082)
Contributions - employer - 16,518,568 (16,518,568)
Contributions - employee - 2,505,657 (2,505,657)
Net investment income - 43,963,504 (43,963,504)
Administrative expenses - (2,355,339) 2,355,339
Net changes 15,172,508 18,072,847 (2,900,339)
Balance at June 30, 2018 (Measurement Date)796,863,657$ 539,457,785$ 257,405,872$
Safety Plan
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
109
Note 10 – Pension Plans (Continued)
B. City Plans (Continued)
Sensitivity of the Net Pension Liability to Changes in the Discount Rate
The following presents the City’s net pension liability, calculated using the discount rate, as well as what the City’s
net pension liability would be if it were calculated using a discount rate that is one percentage point lower or one
percentage point higher than the current rate:
Discount Rate - 1%Current Discount Discount Rate + 1%
(6.15%)Rate (7.15%)(8.15%)
Miscellaneous Plan - 53 231,589,924$ 157,934,294$ 97,188,169$
Safety Plan - 54 366,466,408$ 257,405,872$ 168,608,119$
Aggregate Total 598,056,332$ 415,340,166$ 265,796,288$
Plan's Aggregate Net Pension Liability/(Asset)
Pension Plan Fiduciary Net Position
Detailed information about each pension plan’s fiduciary net position is available in the separately issued CalPERS
financial reports.
Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
For the year ended June 30, 2018, the City recognized pension expense in the amounts of $23,599,369 and
$32,673,173, for the miscellaneous and safety plans, respectively.
The amortization period differs depending on the source of the gain or loss. The difference between projected and
actual earnings is amortized over 5-years straight line. All other amounts are amortized straight-line over the
average expected remaining service lives of all members that are provided with benefits (active, inactive and retired)
as of the beginning of the measurement period.
The Expected Average Remaining Service Lifetime (“EARSL”) is calculated by dividing the total future service
years by the total number of plan participants (active, inactive, and retired) in the risk pool. The EARSL for the
Miscellaneous Plan for the 2017-18 measurement period is 2.1 years, which was obtained by dividing the total
service years of 6,449 (the sum of remaining service lifetimes of the active employees) by 3,061 (the total number
of participants: active, inactive, and retired). The EARSL for the Safety Plan for the 2017-18 measurement period
is 2.2 years, which was obtained by dividing the total service years of 2,560 (the sum of remaining service lifetimes
of the active employees) by 1,174 (the total number of participants: active, inactive, and retired).
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
110
Note 10 – Pension Plans (Continued)
B. City Plans (Continued)
Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions (Continued)
At June 30, 2019 the City reported deferred outflows of resources and deferred inflows of resources related to
pensions from the following sources:
Deferred outflows Deferred inflows
of Resources of Resources
Pension contributions made subsequent
to measurement date 13,871,487$ -$
Difference between projected and actual
earning on pension plan investments 1,068,832 -
Changes in assumptions - (1,371,199)
Differences between expected and actual experience - (792,413)
Differences in proportions - -
Total 14,940,319$ (2,163,612)$
Miscellaneous Plan
Deferred outflows Deferred inflows
of Resources of Resources
Pension contributions made subsequent
to measurement date 19,556,883$ -$
Difference between projected and actual
earning on pension plan investments 1,351,441 -
Changes in assumptions 14,965,850 (2,061,719)
Differences between expected and actual experience 3,370 (2,381,782)
Differences in proportions - -
Total 35,877,544$ (4,443,501)$
Safety Plan
Deferred outflows Deferred inflows
of Resources of Resources
Pension contributions made subsequent
to measurement date 33,428,370$ -$
Difference between projected and actual
earning on pension plan investments 2,420,273 -
Changes in assumptions 14,965,850 (3,432,918)
Differences between expected and actual experience 3,370 (3,174,195)
Differences in proportions - -
Total 50,817,863$ (6,607,113)$
Aggregate Totals
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
111
Note 10 – Pension Plans (Continued)
B. City Plans (Continued)
For the Miscellaneous Plan and Safety Plan, $13,871,487 and $19,556,883, respectively, was reported as deferred
outflows of resources related to pensions resulting from City’s contributions subsequent to the measurement date
and will be recognized as a reduction of the net pension liability in the year ended June 30, 2020. Other amounts
reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized
in pension expense as follows:
Year Ended June 30,Miscellaneous Plan Safety Plan
2019 3,322,430$ 17,973,340$
2020 956,940 1,104,222
2021 (4,219,106) (5,667,121)
2022 (1,155,044) (1,533,281)
2023 - -
Thereafter - -
(1,094,780)$ 11,877,160$
Deferred Outflows/(Inflows) of Resources
C. Successor Agency Plan
Plan Description
The Successor Agency Plan of the City of San Bernardino is available to full time employees employed by the
Successor Agency to the San Bernardino Economic Development Agency. Part-time employees must meet specific
criteria for participation. The Classic Plans are closed to new entrants. Benefit Provisions under the Plans are
established by State statutes within the Public Employee’s Retirement Law. CalPERS issues publicly available
reports that include a full description of the pension plans regarding benefit provisions, assumptions and
membership information that can be found on the CalPERS website. Copies of the CalPERS annual financial report
may be obtained from the CalPERS Executive Office – 400 P Street, Sacramento, CA 95814.
Benefits Provided
CalPERS provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan
members and beneficiaries. A classic safety and miscellaneous CalPERS member becomes eligible for Service
Retirement upon attainment of age 50 and 55, respectively, with at least 5 years of credited service. The service
retirement benefit is a monthly allowance equal to the product of the benefit factor, years of service, and final
compensation. The final compensation is the monthly average of the member's highest 12 full-time equivalent
monthly pay. Retirement benefits for classic safety and miscellaneous employees are calculated as 3% and 2.7%,
respectively, of the average final 12 months compensation.
Participant is eligible for non-industrial disability retirement if he becomes disabled and has at least 5 years of
credited service. There is no special age requirement. The standard non-industrial disability retirement benefit is a
monthly allowance equal to 1.8% of final compensation, multiplied by service. Industrial disability benefits are
not offered to miscellaneous employees.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
112
Note 10 – Pension Plans (Continued)
C. Successor Agency Plan (Continued)
Benefits Provided (Continued)
An employee's beneficiary may receive the basic death benefit if the employee dies while actively employed. The
employee must be actively employed with the City to be eligible for this benefit. An employee's survivor who is
eligible for any other pre-retirement death benefit may choose to receive that death benefit instead of this basic
death benefit. The basic death benefit is a lump sum in the amount of the employee's accumulated contributions,
where interest is currently credited at 7.5% per year, plus a lump sum in the amount of one month's salary for each
completed year of current service, up to a maximum of six months' salary. For purposes of this benefit, one month's
salary is defined as the member's average monthly full-time rate of compensation during the 12 months preceding
death.
Upon the death of a retiree, a one-time lump sum payment of $500 will be made to the retiree's designated
survivor(s), or to the retiree's estate.
Benefit terms provide for annual cost-of-living adjustments to each employee’s retirement allowance. Beginning
the second calendar year after the year of retirement, retirement and survivor allowances will be annually adjusted
on a compound basis by 2%.
Employees Covered
At June 30, 2018, the measurement date, the following employees were covered by the benefit terms the Plan:
Successor Agency
Active employees 1
Transferred and terminated employees 36
Retired employees and benificiaries 68
Total 105
Contributions
Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires that the employer
contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective
on the July 1 following notice of a change in the rate. The total plan contributions are determined through the
CalPERS’ annual actuarial valuation process. For public agency cost-sharing plans covered by the Miscellaneous
risk pools, the Plan’s actuarially determined rate is based on the estimated amount necessary to pay the Plan’s
allocated share of the risk pool’s costs of benefits earned by employees during the year, and any unfunded accrued
liability. The employer is required to contribute the difference between the actuarially determined rate and the
contribution rate of employees. For the measurement period ended June 30, 2018 (the measurement date), the active
contribution rate was 7.776% of annual payroll for the Miscellaneous Classic Plan which was paid for by the
employer. The average employer’s contribution rate was 14.369% of annual payroll for the Miscellaneous Classic
Plan.
For the year ended June 30, 2019, employer contributions made for the Successor Agency Miscellaneous Cost -
sharing Plan was as follows:
Successor Agency 765
Contributions - employer 410,556$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
113
Note 10 – Pension Plans (Continued)
C. Successor Agency Plan (Continued)
Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
The City’s net pension liability for each Plan is measured as the proportionate share of the net pension liability. The
net pension liability of the Plans is measured as of June 30, 2018, and the total pension liability for each Plan used
to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2017 rolled forward to
June 30, 2018 using standard update procedures. The City’s proportion of the net pension liability was based on a
projection of the City’s long-term share of contributions to the pension plans relative to the projected contributions
of all participating employers, actuarially determined.
As of June 30, 2018, the City reported net pension liability for its proportionate shares of the net pension liability
of the Successor Agency Miscellaneous Plan as follows:
Plan Total Pension Plan Fiduciary Net Plan Net Pension
Liability Position Liability/(Asset)
Balance at: 6/30/17 (Valuation date)21,630,347$ 15,233,189$ 6,397,158
Balance at: 6/30/18 (Measurement date)21,541,288 15,271,896 6,269,392
Net Changes during 2017-2018 (89,059) 38,707 (127,766)
Increase (Decrease)
The following is the approach established by the plan actuary to allocate the net pension liability and pension
expense to the individual employers within the risk pool.
(1) In determining a cost-sharing plan’s proportionate share, total amounts of liabilities and assets are first
calculated for the risk pool as a whole on the valuation date (June 30, 2017). The risk pool’s fiduciary net
position (“FNP”) subtracted from its total pension liability (“TPL”) determines the net pension liability (“NPL”)
at the valuation date.
(2) Using standard actuarial roll forward methods, the risk pool TPL is then computed at the measurement date
(June 30, 2018). Risk pool FNP at the measurement date is then subtracted from this number to compute the
NPL for the risk pool at the measurement date. For purposes of FNP in this step and any later reference thereto,
the risk pool’s FNP at the measurement date denotes the aggregate risk pool’s FNP at June 30, 2018 less the
sum of all additional side fund (or unfunded liability) contributions made by all employers during the
measurement period (2017-18).
(3) The individual plan’s TPL, FNP and NPL are also calculated at the valuation date.
(4) Two ratios are created by dividing the plan’s individual TPL and FNP as of the valuation date from (3) by
the amounts in step (1), the risk pool’s total TPL and FNP, respectively.
(5) The plan’s TPL as of the Measurement Date is equal to the risk pool TPL generated in (2) multiplied by the
TPL ratio generated in (4). The plan’s FNP as of the Measurement Date is equal to the FNP generated in (2)
multiplied by the FNP ratio generated in (4) plus any additional side fund (or unfunded liability) contributions
made by the employer on behalf of the plan during the measurement period.
(6) The plan’s NPL at the Measurement Date is the difference between the TPL and FNP calculated in (5).
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
114
Note 10 – Pension Plans (Continued)
C. Successor Agency Plan (Continued)
Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
(Continued)
The City’s proportionate share of the net pension liability for the Successor Agency Miscellaneous Plan as of
June 30, 2017 and 2018 was as follows:
Proportion June 30, 2017 0.06451%
Proportion June 30, 2018 0.06506%
Change - Increase (Decrease)0.00056%
For the year ended June 30, 2019, the City recognized pension expense in the amount of $365,243 for the Successor
Agency Miscellaneous Plan.
The amortization period differs depending on the source of the gain or loss. The difference between projected and
actual earnings is amortized over 5-years straight line. All other amounts are amortized straight-line over the
average expected remaining service lives of all members that are provided with benefits (active, inactive and retired)
as of the beginning of the measurement period.
The EARSL for PERF C for the measurement date ending June 30, 2018 is 3.8 years, which was obtained by
dividing the total service years of 516,147 (the sum of remaining service lifetimes of the active employees) by
135,474 (the total number of participants: active, inactive, and retired) in PERF C. Inactive employees and retirees
have remaining service lifetimes equal to 0. Total future service is based on the members’ probability of
decrementing due to an event other than receiving a cash refund.
At June 30, 2019, the City reported deferred outflows of resources and deferred inflows of resources related to
pensions from the following sources:
Deferred outflows Deferred inflows
of Resources of Resources
Pension contributions made subsequent
to measurement date 410,556$ -$
Difference between projected and actual earning on
pension plan investments 30,994 -
Adjustment due to differences in proportions - (237,446)
Changes in assumptions 539,563 -
Difference between actual and expected experience 158,689 -
Difference between employer's actual contributions
and proportionate share of contributions - (347,478)
Total 1,139,802$ (584,924)$
Successor Agency Plan
For the Successor Agency Miscellaneous Plan, $410,556 was reported as deferred outflows of resources related to
pensions resulting from City’s contributions subsequent to the measurement date will be recognized as a reduction
of the net pension liability in the year ended June 30, 2020.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
115
Note 10 – Pension Plans (Continued)
C. Successor Agency Plan (Continued)
Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
(Continued)
Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will
be recognized in pension expense as follows:
Year Ended June 30,
Deferred Outflows/
(Inflows) of Resources
2020 366,417$
2021 121,520
2022 (287,224)
2023 (56,391)
2024 -
Thereafter -
144,322$
Actuarial Methods and Assumptions Used to Determine Total Pension Liability
For the measurement period ended June 30, 2018 (the measurement date), the total pension liability was determined
by rolling forward the June 30, 2017 total pension liability. Both the June 30, 2016 and the June 30, 2017 total
pension liabilities were based on the following actuarial methods and assumptions:
Actuarial Cost Method
Actuarial Assumptions:
Discount Rate
Inflation
Salary Increases
Investment Rate of Return
Mortality Rate Table
Post Retirement Benefit Increase Contract COLA up to 2.75%until Purchasing Power Protection Allowance Floor on Purchasing
Power applies, 2.75% thereafter
Entry Age Normal in accordance with the requirement of GASB Statement No. 68
7.15%
2.75%
Varies by Entry Age and Service
7.65%
Derived using CalPERS’ Membership Data for all Funds.
All other actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial
experience study for the period from 1997 to 2014, including updates to salary increase, mortality and retirement
rates. The Experience Study report can be obtained at CalPERS’ website under Forms and Publications.
Discount Rate
The discount rate used to measure the total pension liability was 7.15%. To determine whether the municipal bond
rate should be used in the calculation of a discount rate for each plan, CalPERS stress tested plans that would most
likely result in a discount rate that would be different from the actuarially assumed discount rate. Based on the
testing, none of the tested plans run out of assets. Therefore, the current 7.15% discount rate is adequate and the
use of the municipal bond rate calculation is not necessary. The long term expected discount rate of 7.15% is applied
to all plans in the Public Employees Retirement Fund. The stress test results are presented in a detailed report called
“GASB Crossover Testing Report” that can be obtained at CalPERS’ website under the GASB 68 section.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
116
Note 10 – Pension Plans (Continued)
C. Successor Agency Plan (Continued)
Discount Rate (Continued)
The long-term expected rate of return on pension plan investments was determined using a building-block method
in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan
investment expense and inflation) are developed for each major asset class. In determining the long-term expected
rate of return, staff took into account both short-term and long-term market return expectations as well as the
expected pension fund cash flows. Such cash flows were developed assuming that both members and employers
will make their required contributions on time and as scheduled in all future years. Using historical returns of all
the funds’ asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years)
and the long-term (11-60 years) using a building block approach. Using the expected nominal returns for both short-
term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set
by calculating the single equivalent expected return that arrived at the same present value of benefits for cash flows
as the one calculated using both short-term and long-term returns. The expected rate of return was then set
equivalent to the single equivalent rate calculated above and rounded down to the nearest one quarter of one percent.
The table below reflects long-term expected real rate of return by asset class. The rate of return was calculated using
the capital market assumptions applied to determine the discount rate and asset allocation. These geometric rates of
return are net of administrative expenses.
New Strategic Real Return Real Return
Asset Class Allocation Years 1-101 Years 11+2
Global Equity 47.00%4.90%5.71%
Global Fixed Income 19.00%0.80%2.43%
Inflation Sensitive 6.00%0.60%3.36%
Private Equity 12.00%6.60%6.95%
Real Estate 11.00%2.80%5.13%
Infrastructure and forestland 3.00%3.90%5.09%
Liquidity 2.00%-0.40%-1.05%
100%
1An expected inflation of 2.5% used for this period
2An expected inflatin of 3.0% used for this period.
Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate
The following presents the City’s proportionate share of the net pension liability for the Successor Agency
Miscellaneous Plan, calculated using the discount rate for the Successor Agency Miscellaneous Pl an, as well as
what the City’s proportionate share of the net pension liability would be if it were calculated using a discount rate
that is one percentage point lower or one percentage point higher than the current rate:
Discount Rate - 1%Current Discount Discount Rate + 1%
(6.15%)Rate (7.15%)(8.15%)
9,183,307$ 6,269,392$ 3,864,003$
Plan's Aggregate Net Pension Liability/(Asset)
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
117
Note 10 – Pension Plans (Continued)
C. Successor Agency Plan (Continued)
Pension Plan Fiduciary Net Position
Detailed information about each pension plan’s fiduciary net position is available in the separately issued CalPERS
financial reports.
Payable to the Pension Plan
At June 30, 2019, the Successor Agency reported a payable of $0 for the outstanding amount of contributions to
the pension plan required for the year ended June 30, 2019.
Note 11 – Other Postemployment Benefits
A. City – Excluding Water Department (Water Enterprise Fund and Sewer Enterprise Fund)
The City administers a single employer defined benefit healthcare plan (the Plan). The Plan provides healthcare
and life insurance for eligible retirees and their surviving spou ses through the City’s group health insurance plan.
Life insurance premiums are paid 100% by retirees. The plan covers both active and retired members. Benefit
provisions are established through negotiations between the City and various union bargaining groups.
However, on August 1, 2012, the City filed a Chapter 9 petition for bankruptcy protection in the United States
Bankruptcy Court. A Retiree Committee was appointed by the United States Trustee to represent the interests of
the retired employees.
On May 19, 2015, the City and the Retiree Committee reached an agreement to settle claims of retirees for lost
health benefits. Pursuant to this settlement all retiree health benefits for employees hired after January 1, 2013 are
eliminated. At June 30, 2017, a finite group of retirees, numbering fewer than sixteen and meeting specific criteria,
continue to receive a subsidy of $116 per month with an annual increase capped at two percent per calendar year.
These participants are placed in a City healthcare plan for Retirees only.
This is a closed group and its beneficiaries are a declining number, gradually being removed from the limited
ongoing benefit as they either pass away or become ineligible for other potential reasons.
The settlement is part of the City’s Chapter 9 Plan of Adjustment effective June 15, 2017. As a result of this
settlement, the City’s OPEB obligation of $29,753,601 has been reduced to zero as the City has eliminated post -
employment benefits.
Plan Description
The City Water Department (Department) provides health benefits to all qualifying retirees and their spouses in
accordance with Memorandums of Understanding under various labor agreements. The Department maintains the
financial activity of the plan as a trust fund, and no separate financial report is publicly available.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
118
Note 11 – Other Postemployment Benefits (Continued)
B. Water Department
Employees Covered
Employees are eligible for retiree health benefits if they retire from the Department on or after age 50 with at least
10, 12, or 15 years of service, depending on bargaining unit, and are eligible for a PERS pension.
As of the June 30, 2018 measurement date, the following current and former employees were covered by the benefit
terms under the OPEB Plan:
Active plan members 239
Inactive employees or beneficiaries currently
receiving benefits 149
Inactive plan members entitled to, but not yet
receiving benefits -
Total 388
Contributions
The contribution requirements of plan members and the Department are established and may be amended by the
Board. The required contribution is based on projected pay-as-you-go financing requirements, with an additional
amount to prefund benefits as may be determined annually by the Board. The Department has established an
irrevocable trust to which pre-funding contributions are made. For the fiscal year ended June 30, 20 19, the
Department’s contributions were $2,134,932, and the amount of contributions in the form of an implied subsidy
were $481,000.
Net OPEB Liability
The Department’s net OPEB liability was measured as of June 30, 2019 and the total OPEB liability used to
calculated the net OPEB liability was determined by an actuarial valuation dated June 30, 2017 that was rolled
forward to determine the June 30, 2018 total OPEB liability, based on the following actuarial methods and
assumptions:
Actuarial Cost Method
Actuarial Assumptions:
Discount Rate 6.25%
Inflation 2.75%
Investment Rate of Return 6.25%
Mortality Rate
Healthcare Trend Rate
Entry Age Normal
CalPERS 1997-2015 Experience Study
Pre-Medicare - 7.5% for 2020, decreasing to an ultimate rate of 4.0% in 2076;
Medicare - 6.5% for 2020, decreasing to an ultimate rate of 4.0% in 2076;
The long-term expected rate of return on OPEB plan investments was determined using a building-block method
in which expected future real rates of return (expected returns, net of OPEB plan investment expense and inflation)
are developed for each major asset class. These ranges are combined to produce the long -term expected rate of
return by weighting the expected future real rates of return by the target asset allocation percentage and by adding
expected inflation.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
119
Note 11 – Other Postemployment Benefits (Continued)
B. Water Department (Continued)
Net OPEB Liability (Continued)
The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized
in the following table:
Long Term Expected Real Rate of Return by Asset Class
Asset Class Target Allocation
Long-term Expected
Real Rate of Return
Fixed income 40.00%1.47%
Global equity 60.00%4.82%
Assumed long-term rate of inflation 0.00%2.75%
Expected long-term rate of return 0.00%6.25%
Total 100.00%
Discount Rate
The discount rate used to measure the total OPEB liability was 6.25 percent. The projection of cash flows used to
determine the discount rate assumed that the Department’s contributions will be made at rates equal to the
actuarially determined contribution rates. Based on those assumptions, the OPEB plan’s fiduciary net position was
projected to be available to make all projected OPEB payments for current and inactive employees and
beneficiaries. Therefore, the long-term expected rate of return on OPEB plan investments was applied to all periods
of projected benefit payments to determine the total OPEB liability.
Changes in the Net OPEB Liability
The changes in the net OPEB liability are as follows:
Total OPEB Plan Fiduciary Net Net OPEB
Liability Position Liability/(Asset)
(a)(b)(c) = (a) - (b)
Balance at June 30, 2017 38,905,000$ 22,348,000$ 16,557,000$
Changes Recognized for the Measurement Period:
Service Cost 1,067,080 - 1,067,080
Interest on the total OPEB liability 2,449,681 - 2,449,681
Changes in benefit terms (640,849) - (640,849)
Changes in assumptions (1,065,369) - (1,065,369)
Differences between expected and actual experience 523,834 - 523,834
Contributions - employer - 2,673,389 (2,673,389)
Net investment income - 1,848,262 (1,848,262)
Benefit payments, including refunds of member
contributions (1,554,389) (1,554,389) -
Administrative expenses - (7,855) 7,855
Net Changes during July 1, 2017 to June 30, 2018 779,988$ 2,959,407$ (2,179,419)$
Balance at June 30, 2018 (Measurement Date)39,684,988$ 25,307,407$ 14,377,581$
Increase (Decrease)
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
120
Note 11 – Other Postemployment Benefits (Continued)
B. Water Department (Continued)
Sensitivity of the Net OPEB Liability to Changes in the Discount Rate
The following represents the net OPEB liability of the Department if it were calculated using a discount rate that
is one percentage point lower or one percentage point higher than the current rate, for measurement period ended
June 30, 2018:
Discount Rate - 1%Current Discount Discount Rate + 1%
(5.25%)Rate (6.25%)(7.25%)
20,531,245$ 14,377,581$ 9,415,592$
Plan's Net OPEB Liability/(Asset)
Sensitivity of the Net OPEB Liability to Changes in the Health Care Cost Trend Rates
The following represents the net OPEB liability of the Department if it were calculated using a health care cost
trend rates that are one percentage point lower or one percentage point higher than the current rate, for measurement
period ended June 30, 2018:
(6.5% Pre-Medicare (7.5% Pre-Medicare (8.5% Pre-Medicare
decreasing to decreasing to decreasing to
5.5% Medicare)6.5% Medicare)7.5% Medicare)
9,103,858$ 14,377,581$ 20,997,404$
Plan's Net OPEB Liability/(Asset)
Recognition of Deferred Outflows and Deferred Inflows of Resources
Gains and losses related to changes in the total OPEB liability and fiduciary net position are recognized in OPEB
expense systematically over time.
Amounts are first recognized in OPEB expense for the year the gain or loss occurs. T he remaining amounts are
categorized as deferred outflows and deferred inflows of resources related to OPEB and are to be recognized in
future OPEB expense.
The recognition period differs depending on the source of the gain or loss. The net difference between projected
and actual earnings on OPEB plan investments are recognized over five years, while all other deferred outflows
and inflows are amortized over the average expected remaining service life of plan participants. For the
June 30, 2018 measurement date, the average expected remaining service life is 6.4 years.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
121
Note 11 – Other Postemployment Benefits (Continued)
B. Water Department (Continued)
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB
For the fiscal year ended June 30, 2019, the Department recognized OPEB expense of $1,087,999. As of fiscal year
ended June 30, 2018, the Department reported deferred outflows of resources related to OPEB from the following
sources:
Deferred outflows of resources and deferred inflows of resources
Deferred outflows Deferred inflows
of Resources of Resources
OPEB contributions made subsequent to the
measurement date 2,615,932$ -$
Differences between expected and actual experience 441,985 -
Changes of assumptions - 898,905
Net difference between projected and actual earnings on
OPEB plan investments - 930,109
3,057,917$ 1,829,014$ Total
The $2,615,932 reported as deferred outflows of resources related to contributions subsequent to the June 30, 2018
measurement date will be recognized as a reduction of the net OPEB liability during the fiscal year ended
June 30, 2020. Other amounts reported as deferred outflows/inflows of resources related to OPEB will be
recognized as expense as follows:
Measurement Period OPEB
Ending June 30 Expense
2020 (366,392)$
2021 (366,392)
2022 (367,392)
2023 (168,393)
2024 (84,615)
Thereafter (33,845)
(1,387,029)$
C. Successor Agency
The Successor Agency (Agency) administers a single employer defined benefit healthcare plan (the Plan). The
Agency provides medical and dental plan coverage for retirees and their eligible su rviving dependents. At
June 30, 2019, a finite group of retirees and surviving spouses numbering fewer than eleven receive a subsidy of
$128 per month. Because this is a closed plan with de minimis liability impact, the Successor Agency’s OPEB
obligation of $1,583,335 has been reduced to zero and the minor annual costs are being reported on a pay as you
go basis.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
122
Note 12 – Other Required Disclosures
A. Deficit Fund Balances/Net Position
At June 30, 2019, the Governmental Activities Statement of Net Position had an unrestricted net position deficit of
$(307,081,031).
At June 30, 2019, the following proprietary funds, governmental funds, fiduciary funds have deficits that are
anticipated to be funded from future grants, other revenues and operating transfers:
Fund Type Funds Deficit
Governmental Special Assessments Capital Projects Fund (35,991)$
Internal Service Workers' Compensation Fund (25,495,927)
Internal Service Liability Insurance Fund (1,535,368)
Internal Service Motorpool Fund (3,451,016)
Internal Service Information Systems Fund (7,533,556)
Fiduciary Successor Agency to the Economic Development (36,318,411)
Agency of San Bernardino Private-purpose
Trust Fund
As of June 30, 2019, the General Fund does not have the financial capacity to fund such accumulated deficits.
Therefore, management expects that funding for the accumulated deficits will be accomplished over a period of
years. The accumulated deficits of the Workers’ Compensation Internal Service Fund and the Liability Insurance
Internal Service Fund are due to higher claims experienced over a period of years, versus amounts charged to the
various departments. Both these funds operate on a pay-as-you-go basis; as such the deficits in these funds are
expected to change as claims are made. Management has paid and exp ects to pay for all accepted claims as and
when they become due.
B. Expenditures Exceeding Appropriations
For the year ended June 30, 2019, expenditures exceeded appropriations in the following functions of the
General Fund and Federal and State Grants Special Revenue Fund:
Excess Expenditures
Fund Function over Appropriations
General Fund General government: City clerk (31,244)$
General Fund General government: Finance (1,462,242)
General Fund General government: Nondepartmental (3,757,157)
General Fund Debt service: interest
and fiscal charges (589,633)
Federal and State Grants Special
Revenue Fund General government: Finance (262,442)
Federal and State Grants Special
Revenue Fund Culture and recreation: Parks, recreation
and community services (281)
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
123
Note 13 – Fund Balance Classification
The City classifies fund balances, as shown on the Balance Sheet – Governmental Funds, as follows as of June 30, 2019:
Federal
and State Other
General Grants Governmental
Fund Fund Funds Total
Nonspendable
Employee advance 702$ -$ -$ 702$
Prepaid expenditures 692,390 - - 692,390
Property held for resale 32,162,065 - - 32,162,065
Total nonspendable 32,855,157 - - 32,855,157
Restricted
Housing - 17,093,117 18,795,891 35,889,008
Grants - 992,218 - 992,218
Street improvements - - 17,192,230 17,192,230
Cable TV - - 925,424 925,424
Law enforcement - - 3,495,816 3,495,816
Transportation - - 2,546,699 2,546,699
Sewer - - 9,501 9,501
Debt service 73,416 - 94,973 168,389
Capital projects - - 36,910,196 36,910,196
Total restricted 73,416 18,085,335 79,970,730 98,129,481
Committed
Animal control 68,387 - - 68,387
Total committed 68,387 - - 68,387
Unassigned (deficit)31,543,452 - (35,991) 31,507,461
Total fund balances 64,540,412$ 18,085,335$ 79,934,739$ 162,560,486$
Major Funds
Note 14 – Net Investment in Capital Assets
The Government-wide Statement of Net Position reports net investment in capital assets as follows:
Governmental Business-type
Activities Activities Total
Total capital assets, net 296,311,492$ 285,505,784$ 581,817,276$
Less related debt:
Notes payable (5,428,883) (300,000) (5,728,883)
Lease revenue bonds (3,598,360) - (3,598,360)
California Infrastructure (406,234) - (406,234)
Bonds payable - (85,482,663) (85,482,663)
Unspent bond proceeds - 59,948,377 59,948,377
Net investment in capital assets 286,878,015$ 259,671,498$ 546,549,513$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
124
Note 15 – Landfill Closure Liability
The City operated a municipal non -hazardous solid waste facility, identified as the “Waterman Landfill”, from 1950
to 1960. The City is the primary responsible party for pollution remediation obliga tions related to the Waterman
Landfill. During the 1990s, groundwater monitoring wells were installed and placed into service as part of the overall
remediation plan. In 2004, it was determined that additional work was required to comply with state regulat ions.
State regulatory agencies approved a plan for final closure of the Waterman Landfill in 2012. The City is currently
in the operations maintenance and monitoring phase of the remediation project. Pollution remediation costs for the
closure of the Waterman Landfill are estimate d at $6,150,136 at June 30, 2019, measured using the expected cash
flow technique.
This estimate is subject to change in future periods due to various factors including changes in the remediation plan
or operating conditions, the type of equipment and services that will be used, price increases or reductions for specific
outlay elements such as ongoing monitoring requirements, changes in technology, or changes in legal or regulatory
requirements. The liability is reported in the Integrated Waste Fund in the accompanying financial statements.
Note 16 – Prior Period Adjustments
A. Governmental Activities
The City recorded the following prior period adjustments to the beginning net position of the Governmental
Activities in order to adjust notes receivable and related allowance for doubtful accounts in the amount of
$24,952,175 and to record an adjustment to the value of property held for resale in the amount of $49,500.
Governmental
Activities
Net position at July 1, 2018, as previously reported 124,628,513$
To adjust notes receivable and related allowance for doubtful accounts (24,952,175)
To adjust property held for resale balances 49,500
Net position at July 1, 2018, as restated 99,725,838$
B. Governmental Fund Financial statements
The City recorded the following prior period adjustments to the beginning fund balance of the the Federal and State
Grants Major Special Revenue Fund , and the Low and Moderate Income Housing Special Revenue Fund in order
to adjust notes receivable and related allowance for doubtful accounts in the amount of $24,952,175 and to record
an adjustment to the value of property held for resale in the amount of $49,500.
Federal and State Low and Moderate
Grants Major Income Housing
Special Revenue Special Revenue
Fund Fund
Fund balance at July 1, 2018, as previously reported 21,557,270$ 40,401,479$
To adjust notes receivable and related allowance for doubtful accounts (3,676,618) (21,275,557)
To adjust property held for resale balances - 49,500
Fund balance at July 1, 2018, as restated 17,880,652$ 19,175,422$
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
125
Note 16 – Prior Period Adjustments (Continued)
C. Fiduciary Fund Financial Statements
The City recorded the following prior period adjustments to the amount held in trust of the Successor Agency To
the Economic Development Agency of San Bernardino Private-purpose Trust Fund in order to adjust notes
receivable and related allowance for doubtful accounts in the amount of $1,157,939.
Successor Agency
To the Economic
Development
Agency
of San Bernardino
Private-purpose
Trust Fund
Held in trust at July 1, 2018, as previously reported (46,143,509)$
To adjust notes receivable and related allowance for doubtful accounts (1,157,939)
Held in trust at July 1, 2018, as restated (47,301,448)$
Note 17 – Successor Agency Trust for Assets of Former R edevelopment Agency
On December 29, 2011, the California Supreme Court upheld Assembly Bill X1 26 (the “Bill”) that provides for the
dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City
since the City had previously reported its redevelopment agency (commonly referred to as the “Economic Development
Agency” or “EDA”) as a blended component unit on the City’s financial statements.
The Bill provides that upon dissolution of the redevelopment agency, either the city or another unit of local government
may serve as the “successor agency” to hold the assets of the dissolved redevelopment agency until they are disposed
of in accordance with applicable laws and regulations. On January 9, 2012, the City Council adopted resolution 2012-
12, electing to serve as the Successor Agency to the former redevelopment agency of the City of San Bernardino in
accordance with the Bill. On January 23, 2012, the City Council adopted resolution 2012-19 to have the City of San
Bernardino serve as the Successor Housing Agency to the former redevelopment agency of the City of San Bernardino.
After enactment of the law, which occurred on June 28, 2011, redevelopment agencies in the State of California were
prohibited from entering into new projects, obligations or commitments. Subject to the control of a newly established
oversight board, remaining assets can only be used to pay enforceable obligations in existence at the date of dissolution,
including the completion of any unfinished projects that were subject to legally enforceable contractual commitments.
In future fiscal years, successor agencies will only be allocated tax increment revenue (to the extent a vailable in the
Redevelopment Property Tax Trust Fund, or “RPTTF”, as maintained by the County Auditor/Controller) in the amount
that is necessary to pay the estimated annual payments on enforceable obligations of the former redevelopment agency
until all enforceable obligations of the prior redevelopment agency have been paid in full and all assets have been
redistributed or liquidated.
The Bill directs the State Controller of the State of California to review the propriety of any transfers of assets between
redevelopment agencies and other public bodies that occurred after January 1, 2011. If the public body that received
such transfers is not contractually committed to a third party for the expenditure or encumbrance of those assets, the
State Controller is required to order the available assets to be transferred to the public body designated as the successor
agency by the Bill.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
126
Note 17 – Successor Agency Trust for Assets of Former Redevelopment Agency (Continued)
In accordance with the timeline set forth in the Bill (as modified by the California Supreme Court on
December 29, 2011) all redevelopment agencies in the State of California were dissolved and ceased to operate as a
legal entity as of February 1, 2012. After the date of dissolution, the assets, liabilities, and activities of the dissolved
redevelopment agency are reported in the Low and Moderate Income Housing Fund, a City special revenue fund (for
housing assets, liabilities, and activities), and a private-purpose trust fund, a type of fiduciary fund (for non-housing
assets, liabilities, and activities), in the financial statements of the City.
The EDA and the Successor Agency to the EDA conducted some of their activities through three affiliated entities: San
Bernardino Economic Development Corporation (SBEDC), Affordable Housing Solutions (AHS), and Sustainable
Communities Reinvestment Partnership (SCRIP). The financial activities of these affiliated entities are reported in the
fiduciary funds of the accompanying financial statements, as components of the Successor Agency.
San Bernardino Economic Development Corporation – SBEDC was incorporated in 1973 as a nonprofit public benefit
corporation. SBEDC’s purpose is to assist the EDA in promoting development and redevelopment of properties within
the City of San Bernardino (City). SBEDC currently holds title to approximately 300 parcels of real property in the City
pursuant to a March 2011 Funding Agreement with the EDA, under which the EDA transferred properties to SBEDC,
and SBEDC committed to develop the properties using funding provided by the EDA. These parcels include 128 parcels
for the Bice Property project, 74 parcels for the Arden-Guthrie Property project, and 5 parcels for the Carousel Mall (an
approximately 650,000 square foot indoor mall), which is owned and operated through the Carousel Mall LLC (a single-
member limited liability company with SBEDC as the single member).
The funding agreement and the transfer of the properties were validated in a judgment entered on July 27, 2011 by the
Superior Court of the State of California, County of San Bernardino, in an action brought by the EDA as Case No.
CIVDS1103893 (Validation Judgment). Subsequently, however, the State Controller’s Office (SCO), as authorized by
the June 2011 and June 2012 legislation providing for the dissolution of redevelopment agencies, conducted a review
of the transfers and issued a report dated March 6, 2013 (SCO’s “City of San Bernardino Economic Development
Agency – Asset Transfer Review Report.”). The SCO contended in the report that the transfers were unallowable and
that the Validation Judgment was not effective.
As a result, the properties were transferred from SBEDC to the Successor Agency. On December 31, 2015, the
California Department of Finance approved the City’s Long Range Property Management Plan, which transferred
certain properties to the City.
Affordable Housing Solutions (AHS) was incorporated in 2005 as a nonprofit public benefit corporation and was
acquired by the EDA in 2009 to assist it in promoting economic development and increasing the availability of low and
moderate income housing in the City. AHS has developed several successful affordable housing projects, including
Phoenix Square and the Magnolia Square Project. AHS is also the City’s contracted Neighborhood Stabilization
Program administrator as well as its property holding entity for the Home Investment Partnership Program (HOME)
and the Low and Moderate Income Housing Fund (LMIHF). AHS, like SBEDC, entered into an agreement with the
EDA in March 2011 for the receipt of properties and funding from the EDA.
This agreement, and property transfers made pursuant to it, was validated in the Validation Judgment. As with SBEDC,
the SCO disputed the validity of the EDA-AHS transactions. These properties, were transferred to the Low and
Moderate Income Housing Fund and are reported therein as of June 30, 2019.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
127
Note 17 – Successor Agency Trust for Assets of Former Redevelopment Agency (Continue d)
Sustainable Communities Reinvestment Partnership (SCRIP) was organized as a limited liability company in 2009 to
pursue renewable energy and sustainability projects in the City to help improve energy efficiency and reduce greenhouse
gas emissions in the region. SCRIP’s priorities include the development of solar power systems and coordination with
the City-owned geothermal energy operation that serves governmental and private users in the City. In 2010, SCRIP
facilitated the construction of a 250kW photovoltaic solar power system on the roof of a city-occupied building at 201
North “E” Street, San Bernardino. SCRIP also facilitated construction of a 448kW solar power system at the San
Bernardino International Airport in conjunction with the Inland Valley Development Agency.
On September 22, 2015, Senate Bill 107, which amends various sections of the California Health and Safety Code
related to the dissolution of redevelopment agencies, was signed into law. SB 107 contains various provisions which
may impact, among other things, (i) the repayment of prior City/Redevelopment loans, (ii) treatment of City loans to
the Successor Agency to pay enforceable obligations, including bonded debt, and administrative costs, and (iii) the
treatment of special levies.
On December 31, 2015, the California Department of Finance (Finance) has approved the City’s revised Long Range
Property Management Plan (LRPMP), with the assets deemed for governmental use and future development properties
to be transferred to the City of San Bernardino effective upon the date of Finance’s approval of the LRPMP.
Note 18 – Consent Decree
In 1996, the City of San Bernardino filed a complaint against the United States of America, Department of the Army to
recover damages, response costs and other available remedies relating to contamination alleged to have originated at a
World War II army installation known as Camp Ono. In March 2005, the United States District Court, Central Division
entered judgment, in the form of a Consent Decree, in the matter of City of San Bernardino v. United States of America.
The Consent Decree settles the City’s and the State’s claims arising from the groundwater contamination allegedly
caused by the Army. The Consent Decree contains a number of provisions obligating the City (through the City’s Water
Department) to operate and maintain the Newmark Groundwater Superfund site (Site). The Site consists of two operable
units, the Newmark Operable Unit and the Muscoy Operable Unit. The Newmark Operable Unit was declared
operational and functional in 1998. The Muscoy Operable unit was declared operational and functional in 2007.
The Consent Decree provided for a payment of $69 million from the Army to the City for performance of the work
outlined in the Consent Decree. Upon acceptance of the Consent Decree, the Department received title to all facilities
constructed by the United States Environmental Protection Agency (EPA) of the Site and agreed to operate and maintain
the groundwater extraction and treatment system for a period of 50 years. The $69 million payment consisted of $59
million for operations and maintenance and $10 million for the construction of certain capital facilities that would be
required in the future; the funds are subject to strict limitations, contained in the Consent Decree, as to how the money
may be spent.
Pursuant to the Consent Decree, $10 million, including interest earned, has been set aside to be used only for (i) funding
construction of treatment and directly related transmission systems that expand the City’s Water Department’s capacity
to deliver potable water and (ii) funding work performed by the City’s Water Department to complete construction of
the Muscoy Operable Unit extraction system. These capital facility funds may not be used for costs incurred to operate,
maintain, repair or retrofit components of the site extraction of treatment systems constructed by EPA.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
128
Note 18 – Consent Decree (Continued)
In March 2006, the City’s Water Department entered into a Guaranteed Investment Contract (GIC) with AIG Match
Funding Corporation. The Department invested $16,482,039 of excess Consent Decree funds into an interest bearing
Escrow Fund investment with an interest rate of 4.95% per annum. These funds were invested to pay costs associated
with the water facilities defined in the Consent Decree for years 2035-2056. An additional $50 million was used to
purchase a blended insurance policy to provide a financial vehicle that provides cost cap coverage for the first 30 years
of expenses.
The terms of the GIC only provided the Department with the position of a secured creditor with respect to an AIG
bankruptcy. As concerns rose regarding AIG’s financial credibility, in October 2009, the Department negotiated and
accepted a “payout” in the amount of $18,661,876, which represented the principal and accrued interest as of that date.
These funds are currently invested in a diversified portfolio managed by PFM Asset Management. The balance of
restricted investments held at June 30, 2019 is $23,346,376.
Note 19 – Jointly Governed Organizations and Joint Ventures
Inland Valley Development Agency
In January 1990, the City entered into a joint powers agreement with the Cities of Colton and Loma Linda and the
County of San Bernardino to form the Inland Valley Development Agency (IVDA). The IVDA adopted a
redevelopment plan, and its primary purpose is to promote the redevelopment of the former Norton Air Force Base and
other areas within its project area. The IVDA board is comprised of three members from the City and two each from
the other members. The primary sources of funding are tax increment and lease income. Additional financial
information can be obtained by contacting the IVDA at 1601 E. Third Street, San Bernardino, CA 92408.
San Bernardino International Airport Authority
In May 1992, the City entered into a joint powers agreement with the Cities of Colton, Loma Linda, Highland and
Redlands and the County of San Bernardino to form the San Bernardino International Airport Authority (SBIAA).
SBIAA was created primarily for the purpose of acquiring, operating, repairing, maintaining and administering the
aviation related portions of the former Norton Air Force Base property located in San Bernardino. Eff ective
April 19, 1996, the City of Redlands withdrew from its membership in SBIAA. The board is comprised of two members
from the City and one each from the other members. The primary sources of funding are loans, federal grants and lease
income. Additional financial information can be obtained by contacting SBIAA at 1601 E. Third Street, San Bernardino,
CA 92408.
San Bernardino Regional Water Resource Authority
In August 1998, the City entered into a joint powers agreement with the Inland Valley Developm ent Agency (IVDA)
and the San Bernardino Valley Municipal Water District (the District) to form the San Bernardino Regional Water
Resources Authority (the Authority). The Authority was created primarily for the purpose of conducting a water
resource and storage project. The Authority board is comprised of three members from the City, one member from
IVDA and two from the District. The primary sources of funding are loans and grants. Additional financial
information can be obtained by contacting the Authorit y at 201 North “E” Street, Third Floor, San Bernardino, CA
92401.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
129
Note 19 – Jointly Governed Organizations and Joint Ventures (Continued)
Colton / San Bernardino Regional Tertiary Treatment and Water Reclamation Authority
On August 2, 1994, the City of San Bernardino, through the Water Department formed a joint powers authority with
the City of Colton to construct, operate, use and maintain tertiary wastewater treatment, disposal and water
reclamations systems, including th e Regional Rapid Infiltration and Extraction Facility (RIX). This authority is
governed by a separate board consisting of four members; two appointed by the City through the Water Department's
Board of Water Commissioners and two appointed by the City Coun cil of the City of Colton. Construction of RIX
was administered by the Santa Ana Watershed Project Authority and was substantially completed during 1996.
Administration and operation was turned over at that time. The cities of San Bernardino and Colton eac h have an
undivided interest in the real property and any related debt of the RIX projects based on an 80% / 20% split,
respectively. Substantially all of the assets of RIX are in the form of capital assets. RIX has no liabilities. Annual
revenues (in the form of contributions from the two member cities) are equal to annual expenses. The Water
Department's equity interest in this joint venture has been reported as an investment in joint venture in the
accompanying statement of net position. The RIX complete financial statements may be obtained at the City of San
Bernardino Municipal Water Department at 444 W. Rialto Avenue, San Bernardino, CA 92418.
West End Water Development, Treatment and Conservation Joint Powers Authority
On August 15, 1990, the City of San Bernardino joined the West End Water Development, Treatment and Conservation
Joint Powers Authority (WEJPA) as a financing vehicle for construction of water facilities. A three-member board
consisting of one representative from each agency’s governing body governs the WEJPA. This joint venture was formed
to provide a financing vehicle for the three member agencies. This joint venture is currently inactive.
Note 20 – Commitments and Contingencies
A. Litigation
The City is a defendant in numerous lawsuits and is also subject to other claims, including claims for workers’
compensation payments. The City generally uses outside counsel to adjudicate lawsuits. Each claim and case is
initially rated by the City’s risk management team and outside Claims Examiner. At that stage, if a claim or case
is likely to exceed the City’s self-insured retention of $1 million, the case or claim is reported to the City’s excess
insurance carrier(s). In addition, upon the filing of a case and assignment of that case to outside counsel, outside
counsel is required to provide the City with a full report identifying the City’s potential exposure and the likely fees
and costs to take the case to trial. Such report may be delayed if the case is expected to be resolved relatively
quickly.
Only cases rated 'probable' for recovery from the City are reported for financial statement purposes. The dollar
value reserved for any eventual payout on any said case is based upon the facts of the ca se, industry standards
relative to the type of injury or damage involved, and the experience of the handling attorney. The City used a third-
party actuary to perform a workers’ compensation reserve analysis and the general liability claims analysis
(estimated loss reserve) as of June 30, 2019. The actuary used a general approach that relied upon actual loss
development patterns for the City of San Bernardino to the extent they are available and is augmented with industry
benchmark loss development patterns based on insurance industry sources and patterns to project ultimate losses.
While it is not possible to project the final outcome of these lawsuits and claims, the City and its legal department
have estimated that the liability for all such litigation and claims totaled approximately $31.02 million for the
primary government as of June 30, 2019. These lawsuits and claims may be compromised and/or discharged
pursuant to a plan of adjustment confirmed in the Bankruptcy Case.
City of San Bernardino
Notes to the Basic Financial Statements (Continued)
For the Fiscal Year Ended June 30, 2019
130
Note 20 – Commitments and Contingencies
A. Litigation (Continued)
The City’s plan of adjustment became effective on the Effective Date, June 15, 2017, and all transactions necessary
to implement the plan of adjustment closed. In the days that followed, the City made all required cash distributions
on or shortly after the Effective Date. During the fiscal year 201 9, the City has paid, and in the forthcoming three
to five years, the City is committed to making settlement payments to the various claimant’s beneficiaries per the
terms agreed upon under their respective Settlement Agreements.
A copy of the Confirmation Order and the City’s Plan of Adjustment is available on the City’s website at:
http://www.sbcity.org/cityhall/finance/chapter_9_bankruptcy/default.asp. Copies of other pleadings filed in the
City’s Chapter 9 case and other information can be obtained directly from the records of the Bankruptcy Court.
B. Federal and State Grants
Amounts received or receivable from grantor agencies are subject to audits or adjustme nts by grantor agencies,
principally the federal and state governments. Such audits could lead to disallowed claims under the terms of the
grants, including amounts already collected, which may constitute a liability of the City.
C. Gas Tax Revenues
The City is subject to periodic audits of its use of gas tax revenues by the State Controller’s Office. The City used
a portion of gas tax revenues to make certain debt service payments on a note payable related to pavement
rehabilitation (street-related) projects. State guidelines relating to gas tax expenditures limit the amount of revenue
available for debt service expenditures, as well as the type of debt that may be paid. State regulatory authorities
have not issued an opinion on the matter and the potential exposure to the City’s General Fund is uncertain, and
therefore, no contingent liability related to this matter has been accrued in the accompanying financial statements.
131
REQUIRED SUPPLEMENTARY INFORMATION
132
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City of San Bernardino
Required Supplementary Information (Unaudited)
Budgetary Information
For the Year Ended June 30, 2019
133
Budgetary Information
The annual budget adopted by the City Council provides for the City’s general operations, and includes proposed
expenditures and estimated revenues. The City Manager and City Council are authorized to make the necessary changes
to the budget to ensure adequate and proper standards of services.
Following approval of the final budget by the Mayor and City Council, budget transfers within a department budget in
an amount not to exceed $25,000 per transfer, shall be approved or disapproved according to established Finance
Department policies and procedures, with notice to the Director of Finance and written notice to the Mayor and City
Council, as long as the total department budget allocation is not increased. Elected officials may make transfers and
allocations within their department with notice to the Finance Director and without City Council approval. All other
transfers of appropriations, however, require the special approval of the City Council. The legal level of budgetary
control is considered to be the department level.
The budget is formally integrated into the accounting system and employed as a managed control device during the
year.
For the fiscal year ended June 30, 2019, budgets were legally adopted for all City funds except the following:
Special Revenue Funds
Low and Moderate Income Housing Fund
Sewerline Maintenance Fund
Debt Service Funds
Verdemont Improvement Loan Fund
Assessment District #1015 Fund
Capital Projects Funds
Park Construction Fee Fund
Sewerline Construction Fund
Street Construction Fund
Public Improvements Fund
Prop 1B Local Streets Fund
All budgets are adopted on a basis consistent with generally accepted accounting principles.
At fiscal year-end, operating budget appropriations lapse; however, appropriations for incomplete capital
improvements, equipment purchases, and contractual obligations can be carried over to the following fiscal year.
Under Article XIIIB of the California Constitution (the Gann Spending Limitation Initiative), the City is restricted as
to the amount of annual appropriations from the proceeds of taxes, and if proceeds of taxes exceed allowed
appropriations, the excess must either be refunded to the State Controller, returned to the taxpayers through revised tax
rates or revised fee schedules, or an excess in one year may be offset against a deficit in the following year. Further ,
Section 5 of Article XIIIB allows the City to designate a portion of fund balance for general contingencies to be used
in future years without limitation.
City of San Bernardino
Required Supplementary Information (Unaudited) (Continued)
Budgetary Comparison Schedules – General Fund
For the Year Ended June 30, 2019
134
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:
Taxes 103,345,000$ 103,345,000$ 105,604,698$ 2,259,698$
Licenses and permits 10,155,000 10,155,000 11,567,573 1,412,573
Fines and forfeitures 1,740,000 1,890,000 2,281,190 391,190
Use of money and property 350,000 350,000 1,048,252 698,252
Lease revenue 840,000 840,000 1,099,730 259,730
Intergovernmental 1,130,000 1,145,000 1,332,916 187,916
Charges for services 5,484,600 5,484,600 7,021,328 1,536,728
Other revenues 4,597,500 4,602,500 3,015,369 (1,587,131)
Total revenues 127,642,100 127,812,100 132,971,056 5,158,956
EXPENDITURES:
Current:
General government
Mayor 681,420 733,520 645,771 87,749
Common council 951,736 1,021,989 930,418 91,571
City clerk 897,554 897,554 928,798 (31,244)
City attorney 3,128,333 2,996,333 2,996,132 201
City administrator 3,266,755 3,296,755 2,797,456 499,299
Personnel 1,080,077 1,280,077 1,057,254 222,823
Finance 3,719,035 3,719,035 5,181,277 (1,462,242)
Nondepartmental 4,128,532 4,610,929 8,368,086 (3,757,157)
Public safety
Police 83,669,246 84,430,498 81,553,652 2,876,846
Streets
Public services 10,260,011 24,439,819 24,119,892 319,927
Culture and recreation
Park, recreation and community services 7,375,843 3,485,039 3,424,819 60,220
Community development 4,783,461 4,771,899 4,015,206 756,693
Community service 2,688,599 2,585,313 2,454,631 130,682
Debt service:
Principal 1,785,000 1,785,000 1,517,120 267,880
Interest and fiscal charges - - 589,633 (589,633)
Total expenditures 128,415,602 140,053,760 140,580,145 (526,385)
REVENUES OVER
(UNDER) EXPENDITURES (773,502) (12,241,660) (7,609,089) 4,632,571
OTHER FINANCING SOURCES (USES)
Proceeds from sale of capital assets - - 58,949 58,949
Transfers out - (4,200,000) - 4,200,000
Total other financing sources (uses)- (4,200,000) 58,949 4,258,949
CHANGE IN FUND BALANCE (773,502)$ (16,441,660)$ (7,550,140) 8,891,520$
Fund Balance:
Beginning of year 72,090,552
End of year 64,540,412$
Budgeted Amounts
City of San Bernardino
Required Supplementary Information (Unaudited) (Continued)
Budgetary Comparison Schedules – Federal and State Grants Special Revenue Fund
For the Year Ended June 30, 2019
135
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:
Use of money and property -$ -$ 92,069$ 92,069$
Intergovernmental 7,008,009 12,810,305 10,694,959 (2,115,346)
Total revenues 7,008,009 12,810,305 10,787,028 (2,023,277)
EXPENDITURES:
Current:
General government
City administrator - 499,411 184,809 314,422
Finance - - 180 (180)
Public safety
Police 648,515 1,906,929 2,169,371 (262,442)
Streets
Public services 5,541,932 6,060,383 4,788,504 1,271,879
Culture and recreation
Park, recreation and community services - - 281 (281)
Community development 6,149,344 4,574,061 1,731,260 2,842,801
Community service 823,365 1,033,794 971,073 62,721
Debt Service:
Principal 454,000 454,000 454,000 -
Interest and fiscal charges 282,870 282,870 282,867 3
Total expenditures 13,900,026 14,811,448 10,582,345 4,228,923
CHANGE IN FUND BALANCE (6,892,017)$ (2,001,143)$ 204,683 2,205,826$
FUND BALANCE:
Beginning of year, as restated (Note 16)17,880,652
End of year 18,085,335$
Budgeted Amounts
City of San Bernardino
Required Supplementary Information (Unaudited) (Continued)
Schedule of Changes in the Net Pension Liability and Related Ratios
For the Year Ended June 30, 2019
136
Total Pension Liability 2017-18 2016-17 2015-16 2014-15 2013-14 1
Service cost 6,941,229$ 7,045,162$ 7,155,797$ 7,442,643$ 7,664,862$
Interest on total pension liability 38,956,825 38,182,872 37,886,480 36,972,628 35,857,877
Differences between expected and actual
experience (1,512,789) (8,734,519) (6,107,773) (4,628,505) -
Changes in assumptions (2,617,743) 30,840,588 - (8,789,538) -
Changes in benefit terms - - - - -
Benefit payments, including refunds of employee
contributions (30,834,523) (29,607,481) (27,022,461) (25,414,126) (24,178,446)
Net change in total pension liability 10,932,999 37,726,622 11,912,043 5,583,102 19,344,293
Total pension liability - beginning 560,927,881 523,201,259 511,289,216 505,706,114 486,361,821
Total pension liability - ending (a)571,860,880$ 560,927,881$ 523,201,259$ 511,289,216$ 505,706,114$
Plan fiduciary net position
Contributions - employer 11,868,160$ 9,782,993$ 9,535,349$ 8,328,349$ 10,201,167$
Contributions - employee 3,003,123 3,005,285 3,307,239 3,362,371 4,422,413
Investment income (net of administrative expenses)33,535,039 41,369,230 2,060,677 8,671,204 58,763,840
Benefit payments (30,834,523) (29,607,481) (27,022,461) (25,414,126) (24,178,446)
Other (1,808,998) (553,567) (230,854) (435,431) -
Net change in plan fiduciary net position 15,762,801 23,996,460 (12,350,050) (5,487,633) 49,208,974
Plan fiduciary net position - beginning 398,163,785 374,167,325 386,517,375 392,005,008 342,796,034
Plan fiduciary net position - ending (b)413,926,586$ 398,163,785$ 374,167,325$ 386,517,375$ 392,005,008$
Net pension liability - ending (a)-(b)157,934,294$ 162,764,096$ 149,033,934$ 124,771,841$ 113,701,106$
Plan fiduciary net position as a percentage of the
total pension liability 72.38%70.98%71.51%75.60%77.52%
Covered payroll 37,507,992$ 37,664,590$ 41,939,966$ 42,405,805$ 41,173,517$
Net pension liability as a percentage of
covered payroll 421.07%432.14%355.35%294.23%276.15%
Notes to Schedule:
1 Historical information is presented only for measurement periods for which GASB 68 is applicable.
As of June 30, 2019
Benefit changes:The figures above do not include any liability impact that may have resulted from plan changes which occurred after June
30,2014.This applies for voluntary benefit changes as well as any offers of Two Years of Additional Service Credit (a.k.a.Golden
Handshakes).
Changes of Assumptions: In 2018, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study
and Review of Actuarial Assumptions December 2017.There were no changes in the discount rate.In 2017,the discount rate was reduced
from 7.65 percent to 7.15 percent.In 2016,there were no changes.In 2015,amounts reported reflect an adjustment of the discount rate from
7.5 percent (net of administrative expense)to 7.65 percent (without a reduction for pension plan administrative expense.)In 2014,amounts
reported were based on the 7.5 percent discount rate.
City Miscellaneous Plan - 53
City of San Bernardino
Required Supplementary Information (Unaudited) (Continued)
Schedule of Changes in the Net Pension Liability and Related Ratios (Continued)
For the Year Ended June 30, 2019
137
Total Pension Liability 2017-18 2016-17 2015-16 2014-15 2013-14 1
Service cost 7,839,902$ 10,668,244$ 9,581,356$ 9,902,473$ 11,208,178$
Interest on total pension liability 54,332,493 53,181,646 52,179,027 50,392,288 48,966,477
Differences between expected and actual
experience (652,443) (6,077,710) 104,464 (5,975,828) -
Changes in assumptions (3,779,819) 44,897,552 - (12,404,993) -
Changes in benefit terms - - - - -
Benefit payments, including refunds of employee
contributions (42,567,625) (41,247,705) (37,558,743) (36,206,443) (34,402,815)
Net change in total pension liability 15,172,508 61,422,027 24,306,104 5,707,497 25,771,840
Total pension liability - beginning 781,691,149 720,269,122 695,963,018 690,255,521 664,483,681
Total pension liability - ending (a)796,863,657$ 781,691,149$ 720,269,122$ 695,963,018$ 690,255,521$
Plan fiduciary net position
Contributions - employer 16,518,568$ 11,308,879$ 13,617,432$ 12,378,212$ 18,245,106$
Contributions - employee 2,505,657 2,363,002 3,539,959 3,351,555 5,184,692
Investment income (net of administrative expenses)43,963,504 54,968,745 2,507,728 11,406,991 78,093,954
Benefit payments (42,567,625) (41,247,705) (37,558,743) (36,206,443) (34,402,815)
Other (2,347,257) (730,424) (311,119) (579,829) -
Net change in plan fiduciary net position 18,072,847 26,662,497 (18,204,743) (9,649,514) 67,120,937
Plan fiduciary net position - beginning 521,384,938 494,722,441 512,927,184 522,576,698 455,455,761
Plan fiduciary net position - ending (b)539,457,785$ 521,384,938$ 494,722,441$ 512,927,184$ 522,576,698$
Net pension liability - ending (a)-(b)257,405,872$ 260,306,211$ 113,701,106$ 183,035,834$ 167,678,823$
Plan fiduciary net position as a percentage of the
total pension liability 67.70%66.70%68.69%73.70%75.71%
Covered payroll 25,845,264$ 35,443,848$ 35,506,229$ 36,543,185$ 39,718,552$
Net pension liability as a percentage of
covered payroll 995.95%734.42%276.15%500.88%422.17%
Notes to Schedule:
1 Historical information is presented only for measurement periods for which GASB 68 is applicable.
As of June 30, 2019
Benefit changes:The figures above do not include any liability impact that may have resulted from plan changes which occurred after June
30,2014.This applies for voluntary benefit changes as well as any offers of Two Years of Additional Service Credit (a.k.a.Golden
Handshakes).
Changes of Assumptions: In 2018, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study
and Review of Actuarial Assumptions December 2017.There were no changes in the discount rate.In 2017,the discount rate was reduced
from 7.65 percent to 7.15 percent.In 2016,there were no changes.In 2015,amounts reported reflect an adjustment of the discount rate from
7.5 percent (net of administrative expense)to 7.65 percent (without a reduction for pension plan administrative expense.)In 2014,amounts
reported were based on the 7.5 percent discount rate.
City Safety Plan - 54
City of San Bernardino
Required Supplementary Information (Unaudited) (Continued)
Schedule of the Successor Agency’s Proportionate Share of the
Net Pension Liability and Related Ratios
For the Year Ended June 30, 2019
138
Measurement period, year ended 6/30/2018 6/30/2017 6/30/2016 6/30/2015 6/30/2014 1
Plan's proportion of the net pension liability 0.0650604%0.0645053%0.0654569%0.0653236%0.061320%
Plan's proportionate share of the net pension liability 6,269,392$ 6,397,158$ 5,664,045$ 4,483,755$ 3,815,585$
Plan's covered payroll 92,688$ 89,988$ 89,988$ 464,530$ 451,000$
Plan's proportionate share of the net pension liability as a
percentage of covered payroll 6764.00%7108.90%6294.22%965.22%846.03%
Plan's fiduciary net position 15,271,896$ 15,233,189$ 14,686,614$ 15,896,118$ 17,279,507$
Plan's fiduciary net position as a percentage of the total
pension liability 70.90%70.43%72.17%78.00%81.91%
Plan's proportionate share of aggregate employer
contributions 347,304$ 313,887$ 280,440$ 19,656$ 60,842$
Notes to Schedule:
1 Historical information is presented only for measurement periods for which GASB 68 is applicable.
For the Year Ended June 30, 2019
Successor Agency Plan-1414
City of San Bernardino
Required Supplementary Information (Unaudited) (Continued)
Schedule of Contributions - Pension
For the Year Ended June 30, 2019
139
2018-19 1 2017-18 1 2016-17 1 2015-16 1 2014-15 1 2013-14 1
Actuarially determined contribution 13,871,487$ 11,858,284$ 9,782,993$ 9,535,349$ 8,328,349$ 10,201,167$
Contributions in relation to the actuarially
determined contributions 2 (13,871,487) (11,858,284) (9,782,993) (9,535,349) (8,328,349) (10,201,167)
Contribution deficiency (excess)-$ -$ -$ -$ -$ -$
Covered payroll 38,633,232$ 37,507,992$ 37,664,590$ 41,939,966$ 42,405,805$ 41,173,517$
Contributions as a percentage of
covered payroll 35.91%31.62%25.97%22.74%19.42%24.78%
Notes to Schedule
Valuation date:6/30/2017
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry Age Normal
Amortization method/period
Asset valuation method
Inflation 2.75%
Salary increases Varies by entry age and service
Payroll growth 3.00%
Investment rate of return
Retirement age
Mortality
City Miscellaneous Plan - 53
For details, see June 30, 2015 Funding Valuation Report
Actuarial Value of Assets. For details, see June 30, 2015 Funding Valuation Report.
7.50%, net of pension plan investment and administrative expenses, including inflation
The probabilities of retirement are based on the 2014 CalPERS Experience study for the period
from 1997 to 2011.
The probabilities of mortality are based on the 2014 CalPERS Experience Study for the period from
1997 to 2011. Pre-retirement and Post-retirement mortality rates include 20 years of projected
mortality improvement using Scale BB published by the Society of Actuaries.
1 Historical information is presented only for measurement periods for which GASB 68 is applicable.
2 Employers are assumed to make contributions equal to the actuarially determined contributions.However,some employers may choose to make
additional contributions towards their unfunded liability. Employer contributions for such plans exceed the actuarially determined contributions.
The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2014-15 were from the June 30, 2012
public agency valuations.
As of June 30, 2019
City of San Bernardino
Required Supplementary Information (Unaudited) (Continued)
Schedule of Contributions – Pension (Continued)
For the Year Ended June 30, 2019
140
2018-19 1 2017-18 1 2016-17 1 2015-16 1 2014-15 1 2013-14 1
Actuarially determined contribution 19,556,883$ 16,530,635$ 11,308,879$ 13,617,432$ 12,378,212$ 18,245,106$
Contributions in relation to the actuarially
determined contributions 2 (19,556,883) (16,530,635) (11,308,879) (13,617,432) (12,378,212) (18,245,106)
Contribution deficiency (excess)-$ -$ -$ -$ -$ -$
Covered payroll 26,620,622$ 25,845,264$ 35,443,848$ 35,506,229$ 36,543,185$ 39,718,552$
Contributions as a percentage of
covered payroll 73.47%63.96%31.91%38.35%33.87%45.94%
Notes to Schedule
Valuation date:6/30/2017
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry Age Normal
Amortization method/period
Asset valuation method
Inflation 2.75%
Salary increases Varies by entry age and service
Payroll growth 3.00%
Investment rate of return
Retirement age
Mortality
For details, see June 30, 2015 Funding Valuation Report
Actuarial Value of Assets. For details, see June 30, 2015 Funding Valuation Report.
7.50%, net of pension plan investment and administrative expenses, including inflation
The probabilities of retirement are based on the 2014 CalPERS Experience study for the period
from 1997 to 2011.
The probabilities of mortality are based on the 2014 CalPERS Experience Study for the period from
1997 to 2011. Pre-retirement and Post-retirement mortality rates include 20 years of projected
mortality improvement using Scale BB published by the Society of Actuaries.
City Safety Plan - 54
1 Historical information is presented only for measurement periods for which GASB 68 is applicable.
2 Employers are assumed to make contributions equal to the actuarially determined contributions.However,some employers may choose to make
additional contributions towards their unfunded liability. Employer contributions for such plans exceed the actuarially determined contributions.
The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2014-15 were from the June 30, 2012
public agency valuations.
As of June 30, 2019
City of San Bernardino
Required Supplementary Information (Unaudited) (Continued)
Schedule of Contributions – Pension (Continued)
For the Year Ended June 30, 2019
141
2018-19 1 2017-18 1 2016-17 1 2015-16 1 2014-15 1 2013-14 1
Actuarially determined contribution 410,556$ 347,304$ 313,887$ 280,440$ 19,656$ 60,842$
Contributions in relation to the actuarially
determined contributions 2 (410,556) (347,304) (313,887) (280,440) (19,656) (60,842)
Contribution deficiency (excess)-$ -$ -$ -$ -$ -$
Covered payroll 95,468$ 92,688$ 89,988$ 89,988$ 464,530$ 451,000$
Contributions as a percentage of
covered payroll 430.04%374.70%348.81%311.64%4.23%13.49%
Notes to Schedule
Valuation date:6/30/2017
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry Age Normal
Amortization method/period
Asset valuation method
Inflation 2.75%
Salary increases Varies by entry age and service
Payroll growth 3.00%
Investment rate of return
Retirement age
Mortality
Actuarial Value of Assets. For details, see June 30, 2015 Funding Valuation Report.
7.50%, net of pension plan investment and administrative expenses, including inflation
The probabilities of retirement are based on the 2014 CalPERS Experience study for the period
from 1997 to 2011.
The probabilities of mortality are based on the 2014 CalPERS Experience Study for the period from
1997 to 2011. Pre-retirement and Post-retirement mortality rates include 20 years of projected
mortality improvement using Scale BB published by the Society of Actuaries.
For details, see June 30, 2015 Funding Valuation Report
As of June 30, 2019
1 Historical information is presented only for measurement periods for which GASB 68 is applicable.
2 Employers are assumed to make contributions equal to the actuarially determined contributions.However,some employers may choose to make
additional contributions towards their unfunded liability. Employer contributions for such plans exceed the actuarially determined contributions.
The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2014-15 were from the June 30, 2012
public agency valuations.
Successor Agency Plan - 1414
City of San Bernardino
Required Supplementary Information (Unaudited) (Continued)
Schedule of Changes in Net OPEB Liability and Related Ratios
For the Year Ended June 30, 2019
142
Measurement period, year ended: 2017-18 1 2016-17 1
Total OPEB liability
Service cost 1,067,080$ 1,036,000$
Interest 2,449,681 2,322,000
Changes of benefit terms (640,849) -
Differences between expected and actual experience 523,834 -
Changes of assumptions (1,065,369) -
Benefit payments, including refunds of member contributions (1,554,389) (1,118,000)
Net change in total OPEB liability 779,988 2,240,000
Total OPEB liability - beginning 38,905,000 36,665,000
Total OPEB liability - ending (a)39,684,988$ 38,905,000$
OPEB fiduciary net position
Contributions - employer 2,673,389$ 2,602,000$
Net investment income 1,848,262 2,204,000
Benefit payments, including refunds of member contributions (1,554,389) (1,118,000)
Administrative expense (7,855) (7,000)
Net change in plan fiduciary net position 2,959,407 3,681,000
Plan fiduciary net position - beginning 22,348,000 18,667,000
Plan fiduciary net position - ending (b)25,307,407 22,348,000
Plan net OPEB liability - ending (a) - (b)14,377,581$ 16,557,000$
Plan fiduciary net position as a percentage of the total OPEB liability 64.00%57.00%
Covered payroll 16,768,495$ 19,132,000$
Plan net OPEB liability as a percentage of covered payroll 85.74%86.54%
1 Historical information is presented only for measurement periods for which GASB 68 is applicable.
Changes in assumptions:Demographic assumptions were updated to CalPERS 1997-2015 Experience Study;assumed Medical Plan in
retirement updated to:(1)Non-Medicare -Kaiser:55%;Anthem HMO/PPO:30%/15%;Medicare -Kaiser:60%;Anthem:40%;(2)Life
Insurance Participation updated to 90%; (3) Mortality improvement scale was updated to Scale MP-2018.
Benefit changes:Per updated MOUs,benefit caps increase at the average percentage difference (up to 10%)of HMO premiums from
year to year,except the Mid-Management cap is frozen in line with other bargaining units.Prior increase to future caps was 90%of
average difference in HMO premiums from year to year.
City of San Bernardino
Required Supplementary Information (Unaudited) (Continued)
Schedule of Contributions - OPEB
For the Year Ended June 30, 2019
143
2018-19 1 2017-18 1
Contractually determined contribution (actuarially determined)2,760,000$ 2,592,000$
Contributions in relation to the actuarially determined contributions 2 (2,615,932) (2,673,389)
Contribution deficiency (excess)144,068$ (81,389)$
Covered payroll 3 17,981,957$ 16,768,495$
Contributions as a percentage of covered payroll 14.55%15.94%
Notes to Schedule
Valuation date:6/30/2018
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry Age Normal, level % of pay
Amortization method/period
Asset valuation method
Inflation 2.75%
Discount rate 6.25%
Healthcare cost-trend rates
Mortality CalPERS 1997-2015 Experience Study
Actuarial value; asset gains/losses recognized over 5 years
Level dollar amount over closed 21.5 year period
Pre-Medicare - 7.5% for 2020, decreasing to an ultimate rate of 4.0% in 2076;
Medicare - 6.5% for 2020, decreasing to an ultimate rate of 4.0% in 2076;
The actuarial methods and assumptions used to set the actuarially determined contributions for fiscal year 2018-19 were from the June
30, 2018 actuarial valuation.
2 Employers are assumed to make contributions equal to the actuarially determined contributions.However,some employers may
choose to make additional contributions towards their unfunded liability.Employer contributions for such plans exceed the actuarially
determined contributions.
1 Historical information is presented only for measurement periods for which GASB 68 is applicable.
144
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SUPPLEMENTARY INFORMATION
145
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146
NON-MAJOR
GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS:
Cable TV Fund -This fund is used to account for the regulatory oversight of the City's cable companies for franchise
compliance, consumer protection, and franchise renewal negotiations, as well as operating two access channels.
Asset Seizure Fund -This fund is used for the investigation, detection, and prosecution of criminal activities. Funding
is provided by criminal assets seized under existing state and federal statutes.
Low and Moderate Income Housing Fund - This fund is used for the continued maintenance and operations of low and
moderate income housing project activities of the former redevelopment agency. This fund was established on February
1, 2012, when the City elected to become the Housing Successor to the housing related activities of the former
Alternative Transportation Fund -This fund is used to account for the receipt and disbursement of funds received per
Assembly Bill 2766, which imposed an additional registration fee on motor vehicles. These revenues are to be used to
reduce air pollution from mobile sources and for related planning, monitoring, enforcement, and technical studies
necessary for the implementation of the California Clean Air Act of 1988.
RMRA Gas Tax Fund -This fund is used to account for the receipt of gasoline tax revenue paid to the City as a
subvention from the State of California for SB-1. These funds are transferred to the General Fund to partially support
maintenance activities and to finance street construction projects as provided by State law.
Special Gas Tax Fund -This fund is used to account for the receipt of gasoline tax revenue paid to the City as a
subvention from the State of California. These funds are transferred to the General Fund to partially support
maintenance activities and to finance street construction projects as provided by State law.
Traffic Safety Fund -This fund is used for the recording of the City's share of California Vehicle Code fines collected
by San Bernardino County.
Measure I Fund - This fund is used to account for the local street improvements as provided for by the San Bernardino
County Measure I Sales Tax.
Sewerline Maintenance Fund -This fund is used to account for the cost of maintaining sewer lines as paid for from a
portion of sewer revenues.
DEBT SERVICE FUNDS:
Verdemont Loan Fund -This fund is used to account for the collection of assessments from property owners and for
the remittance of such assessments to the loan for improvements in the Verdemont area.
Assessment District #1015 Fund -This fund is used to account for the collection of assessments from property owners
and for the remittance of such assessments to the Successor Agency of the former redevelopment agency (Economic
Development Agency) and other City funds as required by the Improvement Bond Act of 1915 and related California
147
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148
NON-MAJOR
GOVERNMENTAL FUNDS
CAPITAL PROJECTS FUNDS:
Verdemont Fund - This fund is used to account for development fees collected for improvements in the Verdemont area.
Park Construction Fee Fund -This fund is used for park land acquisition and development. Principal revenue sources
are parks acquisition and development fees collected from developers and state revenues for park development.
Sewerline Construction Fund -This fund is used for construction of sewer collection systems from development
revenues.
Storm Drain Construction Fund -This fund is used for construction of storm drain facilities through the City from
development revenues.
Special Assessments Fund -This fund is used to account for assessment districts related to improvement, construction,
and maintenance, including landscape maintenance, sewerline maintenance, and security paid by assessments on
Cultural Development Construction Fee Fund -This fund is used for collection of development fees used to pay for
cultural improvements and activities.
Impact Fees Fund -This fund is used to account for the specific revenue sources that are legally restricted to fund
expenditures from developer impact fees.
Street Construction Fund -This fund is used to account for right-of-way acquisition, construction, and improvements
related to the City's street system. These projects are funded by various state and federal programs and matching City
Public Improvements Fund -This fund is used for maintenance and construction of improvements around the Indian
Bingo Casino located on the reservation.
Prop 1B Local Street Fund -This fund was established to account for monies received from the State through Prop 1B.
This proposition provided $19 billion in bond funds for a variety of transportation projects, including $2 billion for cities
and counties for maintenance and improvements of local transportation facilities.
149
Low and
Moderate
Income
Asset Housing Alternative RMRA
Cable TV Seizure Fund Transportation Gas Tax
ASSETS
Cash and investments 871,314$ 3,547,900$ 2,413,114$ 809,663$ 4,340,831$
Receivables:
Accounts 65,536 - - - -
Notes - - 313,971 - -
Due from other governments - - - 74,358 723,721
Property held for resale - - 16,069,042 - -
Total assets 936,850$ 3,547,900$ 18,796,127$ 884,021$ 5,064,552$
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable 11,426$ 52,084$ 236$ 1,175$ 1,673$
Accrued payroll and related liabilities - - - - 779
Deposits payable - - - - -
Retentions payable - - - - -
Total liabilities 11,426 52,084 236 1,175 2,452
Fund Balances:
Restricted 925,424 3,495,816 18,795,891 882,846 5,062,100
Unassigned (deficit) - - - - -
Total fund balances 925,424 3,495,816 18,795,891 882,846 5,062,100
Total liabilities and fund balances 936,850$ 3,547,900$ 18,796,127$ 884,021$ 5,064,552$
Special Revenue
Non-Major Governmental Funds
June 30, 2019
City of San Bernardino
Combining Balance Sheet
150
Debt Service
Special Traffic Measure I Sewerline Verdemont
Gas Tax Safety Fund Maintenance Loan
ASSETS
Cash and investments 1,975,442$ 1,667,368$ 9,685,460$ 9,501$ 73,029$
Receivables:
Accounts 407,680 - - - -
Notes - - - - -
Due from other governments - 58 1,086,375 - -
Property held for resale - - - - -
Total assets 2,383,122$ 1,667,426$ 10,771,835$ 9,501$ 73,029$
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable 474,989$ 3,573$ 288,580$ -$ -$
Accrued payroll and related liabilities 34,178 - 758 - -
Deposits payable - - - - -
Retentions payable 87,140 - 139,182 - -
Total liabilities 596,307 3,573 428,520 - -
Fund Balances:
Restricted 1,786,815 1,663,853 10,343,315 9,501 73,029
Unassigned (deficit) - - - - -
Total fund balances 1,786,815 1,663,853 10,343,315 9,501 73,029
Total liabilities and fund balances 2,383,122$ 1,667,426$ 10,771,835$ 9,501$ 73,029$
Special Revenue
Non-Major Governmental Funds
June 30, 2019
City of San Bernardino
Combining Balance Sheet (Continued)
151
Debt Service
Assessment Park Storm
District Construction Sewerline Drain
#1015 Verdemont Fee Construction Construction
ASSETS
Cash and investments 21,944$ 261,272$ 145,972$ 121,974$ 9,458,797$
Receivables:
Accounts - - - - -
Notes - - - - -
Notes - - - - -
Property held for resale - - - - -
Total assets 21,944$ 261,272$ 145,972$ 121,974$ 9,458,797$
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable -$ -$ -$ -$ 599,193$
Accrued payroll and related liabilities - - - - 3,251
Deposits payable - - - - -
Retentions payable - - - - 17,200
Total liabilities - - - - 619,644
Fund Balances:
Restricted 21,944 261,272 145,972 121,974 8,839,153
Unassigned (deficit) - - - - -
Total fund balances 21,944 261,272 145,972 121,974 8,839,153
Total liabilities and fund balances 21,944$ 261,272$ 145,972$ 121,974$ 9,458,797$
Capital Projects
June 30, 2019
City of San Bernardino
Combining Balance Sheet (Continued)
Non-Major Governmental Funds
152
Cultural
Development
Special Construction Impact Street Public
Assessments Fee Fees Construction Improvements
ASSETS
Cash and investments 204,348$ 5,127,087$ 19,927,955$ 1,730,811$ 1,134,217$
Receivables:
Accounts - - - - -
Notes - - - - -
Due from other governments 11,300 - - - -
Property held for resale - - - - -
Total assets 215,648$ 5,127,087$ 19,927,955$ 1,730,811$ 1,134,217$
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable 209,006$ 250,360$ 180,977$ -$ -$
Accrued payroll and related liabilities 8,064 - 3,490 - -
Deposits payable 34,569 - - - -
Retentions payable - - 7,688 - -
Total liabilities 251,639 250,360 192,155 - -
Fund Balances:
Restricted - 4,876,727 19,735,800 1,730,811 1,134,217
Unassigned (deficit) (35,991) - - - -
Total fund balances (35,991) 4,876,727 19,735,800 1,730,811 1,134,217
Total liabilities and fund balances 215,648$ 5,127,087$ 19,927,955$ 1,730,811$ 1,134,217$
Capital Projects
City of San Bernardino
Combining Balance Sheet (Continued)
Non-Major Governmental Funds
June 30, 2019
153
Capital Projects
Total
Prop 1B Other
Local Governmental
Street Funds
ASSETS
Cash and investments 64,270$ 63,592,269$
Receivables:
Accounts - 473,216
Notes - 313,971
Due from other governments - 1,895,812
Property held for resale - 16,069,042
Total assets 64,270$ 82,344,310$
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable -$ 2,073,272$
Accrued payroll and related liabilities - 50,520
Deposits payable - 34,569
Retentions payable - 251,210
Total liabilities - 2,409,571
Fund Balances:
Restricted 64,270 79,970,730
Unassigned (deficit)- (35,991)
Total fund balances 64,270 79,934,739
Total liabilities and fund balances 64,270$ 82,344,310$
(Concluded)
City of San Bernardino
Combining Balance Sheet (Continued)
Non-Major Governmental Funds
June 30, 2019
154
Low and
Moderate
Income
Asset Housing Alternative RMRA
Cable TV Seizure Fund Transportation Gas Tax
REVENUES:
Taxes 265,871$ -$ -$ -$ -$
Licenses and Permits - - 150 - -
Impact fees - - - - -
Fines and forfeitures - - - - -
Use of money and property 23,636 99,175 512,914 19,636 65,736
Intergovernmental 10,590 348,199 - 287,781 4,055,126
Charges for services - - - - -
Total revenues 300,097 447,374 513,064 307,417 4,120,862
EXPENDITURES:
Current:
General government 190,950 - - 13,301 -
Public safety - 214,618 - - -
Streets - - - - 549,887
Community development - - 9,958 - -
Community service - - - - -
Total expenditures 190,950 214,618 9,958 13,301 549,887
REVENUES OVER
(UNDER) EXPENDITURES 109,147 232,756 503,106 294,116 3,570,975
OTHER FINANCING SOURCES (USES):
Loss on sale of property held for resale - - (882,637) - -
Transfers in - - - - 1,491,125
Transfers out - - - - -
Total other financing sources (uses)- - (882,637) - 1,491,125
CHANGE IN FUND BALANCES 109,147 232,756 (379,531) 294,116 5,062,100
FUND BALANCES:
Beginning of year, as restated (Note 16) 816,277 3,263,060 19,175,422 588,730 -
End of year 925,424$ 3,495,816$ 18,795,891$ 882,846$ 5,062,100$
(Continued)
City of San Bernardino
Special Revenue
For the Year Ended June 30, 2019
Non-Major Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
155
Debt Service
Special Traffic Measure I Sewerline Verdemont
Gas Tax Safety Fund Maintenance Loan
REVENUES:
Taxes -$ -$ 4,105,053$ -$ -$
Licenses and Permits - - - - 6,276
Impact fees - - - - -
Fines and forfeitures - 456,060 - - -
Use of money and property 8,550 - 330,191 - 329
Intergovernmental 4,507,620 10,351 102,862 - -
Charges for services - - - - 66,424
Total revenues 4,516,170 466,411 4,538,106 - 73,029
EXPENDITURES:
Current:
General government - - - - -
Public safety - 599,998 - - -
Streets 1,447,313 - 6,542,768 - -
Community development - - - - -
Community service - - - - -
Total expenditures 1,447,313 599,998 6,542,768 - -
REVENUES OVER
(UNDER) EXPENDITURES 3,068,857 (133,587) (2,004,662) - 73,029
OTHER FINANCING SOURCES (USES):
Loss on sale of property held for resale - - - - -
Transfers in - - - - -
Transfers out (1,491,125) - - - -
Total other financing sources (uses)(1,491,125) - - - -
CHANGES IN FUND BALANCES 1,577,732 (133,587) (2,004,662) - 73,029
FUND BALANCES:
Beginning of year, as restated (Note 16) 209,083 1,797,440 12,347,977 9,501 -
End of year 1,786,815$ 1,663,853$ 10,343,315$ 9,501$ 73,029$
(Continued)
City of San Bernardino
For the Year Ended June 30, 2019
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued)
Non-Major Governmental Funds
Special Revenue
156
Debt Service
Assessment Park Storm
District Construction Sewerline Drain
#1015 Verdemont Fee Construction Construction
REVENUES:
Taxes -$ -$ -$ -$ -$
Licenses and Permits - - - - -
Impact fees - - - - -
Fines and forfeitures - - - - -
Use of money and property 632 8,498 4,202 - 250,919
Intergovernmental - - - - -
Charges for services - 32,582 - - 1,684,546
Total revenues 632 41,080 4,202 - 1,935,465
EXPENDITURES:
Current:
General government - - - - -
Public safety - - - - -
Streets - 79,427 - - 877,129
Community development - - - - -
Community service - - - - -
Total expenditures - 79,427 - - 877,129
REVENUES OVER
(UNDER) EXPENDITURES 632 (38,347) 4,202 - 1,058,336
OTHER FINANCING SOURCES (USES):
Loss on sale of property held for resale - - - - -
Transfers in - - - - -
Transfers out - - - - -
Total other financing sources (uses)- - - - -
CHANGES IN FUND BALANCES 632 (38,347) 4,202 - 1,058,336
FUND BALANCES:
Beginning of year, as restated (Note 16) 21,312 299,619 141,770 121,974 7,780,817
End of year 21,944$ 261,272$ 145,972$ 121,974$ 8,839,153$
(Continued)
City of San Bernardino
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued)
For the Year Ended June 30, 2019
Capital Projects
Non-Major Governmental Funds
157
Cultural
Development
Special Construction Impact Street Public
Assessments Fee Fees Construction Improvements
REVENUES:
Taxes 1,219,836$ -$ -$ -$ -$
Licenses and Permits - 731,690 - - -
Impact fees - - 1,858,064 - -
Fines and forfeitures - - - - -
Use of money and property - 134,455 549,015 - 32,656
Intergovernmental - - 375,525 113,979 -
Charges for services - - - - -
Total revenues 1,219,836 866,145 2,782,604 113,979 32,656
EXPENDITURES:
Current:
General government - 249,813 - - -
Public safety - - - - -
Streets 1,411,550 - 772,099 - -
Community development - - - - -
Community service - - 347,545 - -
Total expenditures 1,411,550 249,813 1,119,644 - -
REVENUES OVER
(UNDER) EXPENDITURES (191,714) 616,332 1,662,960 113,979 32,656
OTHER FINANCING SOURCES (USES):
Loss on sale of property held for resale - - - - -
Transfers in - - - - -
Transfers out - - - - -
Total other financing sources (uses)- - - - -
CHANGES IN FUND BALANCES (191,714) 616,332 1,662,960 113,979 32,656
FUND BALANCES:
Beginning of year, as restated (Note 16) 155,723 4,260,395 18,072,840 1,616,832 1,101,561
End of year (35,991)$ 4,876,727$ 19,735,800$ 1,730,811$ 1,134,217$
(Continued)
City of San Bernardino
For the Year Ended June 30, 2019
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued)
Non-Major Governmental Funds
Capital Projects
158
Capital Projects
Total
Prop 1B Other
Local Governmental
Street Funds
REVENUES:
Taxes -$ 5,590,760$
Licenses and Permits - 738,116
Impact fees - 1,858,064
Fines and forfeitures - 456,060
Use of money and property 1,850 2,042,394
Intergovernmental - 9,812,033
Charges for services - 1,783,552
Total revenues 1,850 22,280,979
EXPENDITURES:
Current:
General government - 454,064
Public safety - 814,616
Streets - 11,680,173
Community development - 9,958
Community service - 347,545
Total expenditures - 13,306,356
REVENUES OVER
(UNDER) EXPENDITURES 1,850 8,974,623
OTHER FINANCING SOURCES (USES):
Loss on sale of property held for resale - (882,637)
Transfers in - 1,491,125
Transfers out - (1,491,125)
Total other financing sources (uses)- (882,637)
CHANGES IN FUND BALANCES 1,850 8,091,986
FUND BALANCES:
Beginning of year, as restated (Note 16)62,420 71,842,753
End of year 64,270$ 79,934,739$
(Concluded)
City of San Bernardino
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances (Continued)
Non-Major Governmental Funds
For the Year Ended June 30, 2019
159
Variance with
Final Budget
Actual Positive
Original Final
Amounts (Negative)
REVENUES:
Taxes 270,000$ 270,000$ 265,871$ (4,129)$
Use of money and property 5,000 5,000 23,636 18,636
Intergovernmental 20,000 20,000 10,590 (9,410)
Total revenues 295,000 295,000 300,097 5,097
EXPENDITURES:
Current:
General government
City administrator 210,500 210,500 190,950 19,550
Total expenditures 210,500 210,500 190,950 19,550
CHANGE IN FUND BALANCE 84,500$ 84,500$ 109,147 24,647$
FUND BALANCE:
Beginning of year 816,277
End of year 925,424$
Budgeted Amounts
City of San Bernardino
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual
Cable TV Special Revenue Fund
For the Year Ended June 30, 2019
160
Variance with
Final Budget
Actual Positive
Original Final
Amounts (Negative)
REVENUES:
Use of money and property 20,000$ 20,000$ 99,175$ 79,175$
Intergovernmental - - 348,199 348,199
Other revenues 200,000 200,000 - (200,000)
Total revenues 220,000 220,000 447,374 227,374
EXPENDITURES:
Current:
Public safety
Police 291,500 297,058 214,618 82,440
Total expenditures 291,500 297,058 214,618 82,440
CHANGE IN FUND BALANCE (71,500)$ (77,058)$ 232,756 309,814$
FUND BALANCE:
Beginning of year 3,263,060
End of year 3,495,816$
City of San Bernardino
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual
Asset Seizure Special Revenue Fund
For the Year Ended June 30, 2019
Budgeted Amounts
161
Variance with
Final Budget
Actual Positive
Original Final
Amounts (Negative)
REVENUES:
Use of money and property 10,000$ 10,000$ 19,636$ 9,636$
Intergovernmental 250,000 250,000 287,781 37,781
Other revenues - 240,000 - (240,000)
Total revenues 260,000 500,000 307,417 (192,583)
EXPENDITURES:
Current:
General government
City administrator - 240,000 13,301 226,699
Total expenditures - 240,000 13,301 226,699
CHANGE IN FUND BALANCE 260,000$ 260,000$ 294,116 34,116$
FUND BALANCE:
Beginning of year 588,730
End of year 882,846$
City of San Bernardino
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual
Alternative Transportation Special Revenue Fund
For the Year Ended June 30, 2019
Budgeted Amounts
162
Variance with
Final Budget
Actual Positive
Original Final
Amounts (Negative)
REVENUES:
Use of money and property -$ -$ 65,736$ 65,736$
Intergovernmental - 3,849,708 4,055,126 205,418
Total revenues - 3,849,708 4,120,862 271,154
EXPENDITURES:
Current:
Streets
Public services - 4,724,999 549,887 4,175,112
Total expenditures - 4,724,999 549,887 4,175,112
REVENUES OVER
(UNDER) EXPENDITURES - (875,291) 3,570,975 4,446,266
OTHER FINANCING SOURCES:
Transfers in - - 1,491,125 1,491,125
Total other financing sources (uses)- - 1,491,125 1,491,125
CHANGE IN FUND BALANCE -$ (875,291)$ 5,062,100 5,937,391$
FUND BALANCE:
Beginning of year -
End of year 5,062,100$
City of San Bernardino
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual
RMRA Gas Tax Special Revenue Fund
For the Year Ended June 30, 2019
Budgeted Amounts
163
Variance with
Final Budget
Actual Positive
Original Final
Amounts (Negative)
REVENUES:
Use of money and property -$ -$ 8,550$ 8,550$
Intergovernmental 9,065,621 5,215,913 4,507,620 (708,293)
Total revenues 9,065,621 5,215,913 4,516,170 (699,743)
EXPENDITURES:
Current:
Streets
Public services 16,668,745 4,269,004 1,447,313 2,821,691
Total expenditures 16,668,745 4,269,004 1,447,313 2,821,691
REVENUES OVER
(UNDER) EXPENDITURES (7,603,124) 946,909 3,068,857 (3,521,434)
OTHER FINANCING (USES):
Transfers out - - (1,491,125) (1,491,125)
Total other financing sources (uses)- - (1,491,125) (1,491,125)
CHANGE IN FUND BALANCE (7,603,124)$ 946,909$ 1,577,732 630,823$
FUND BALANCE:
Beginning of year 209,083
End of year 1,786,815$
City of San Bernardino
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual
Special Gas Tax Special Revenue Fund
For the Year Ended June 30, 2019
Budgeted Amounts
164
Variance with
Final Budget
Actual Positive
Original Final
Amounts (Negative)
REVENUES:
Fines and forfeitures 320,000$ 320,000$ 456,060$ 136,060$
Intergovernmental 10,000 10,000 10,351 351
Total revenues 330,000 330,000 466,411 136,411
EXPENDITURES:
Current:
Public safety
Police 600,000 600,000 599,998 2
Total expenditures 600,000 600,000 599,998 2
CHANGE IN FUND BALANCE (270,000)$ (270,000)$ (133,587) 136,413$
FUND BALANCE:
Beginning of year 1,797,440
End of year 1,663,853$
City of San Bernardino
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual
Traffic Safety Special Revenue Fund
For the Year Ended June 30, 2019
Budgeted Amounts
165
Variance with
Final Budget
Actual Positive
Original Final
Amounts (Negative)
REVENUES:
Taxes 3,750,000$ 3,750,000$ 4,105,053$ 355,053$
Use of money and property 50,000 50,000 330,191 280,191
Intergovernmental - - 102,862 102,862
Total revenues 3,800,000 3,800,000 4,538,106 738,106
EXPENDITURES:
Current:
Streets
Public services 7,358,999 16,280,805 6,542,768 9,738,037
Total expenditures 7,358,999 16,280,805 6,542,768 9,738,037
CHANGE IN FUND BALANCE (3,558,999)$ (12,480,805)$ (2,004,662) 10,476,143$
FUND BALANCE:
Beginning of year 12,347,977
End of year 10,343,315$
City of San Bernardino
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual
Measure I Special Revenue Fund
For the Year Ended June 30, 2019
Budgeted Amounts
166
Variance with
Final Budget
Actual Positive
Original Final
Amounts (Negative)
REVENUES:
Use of money and property -$ -$ 8,498$ 8,498$
Charges for services - - 32,582 32,582
Total revenues - - 41,080 41,080
EXPENDITURES:
Current:
Streets
Public services 263,000 263,000 79,427 183,573
Total expenditures 263,000 263,000 79,427 183,573
CHANGE IN FUND BALANCE (263,000)$ (263,000)$ (38,347) 224,653$
FUND BALANCE:
Beginning of year 299,619
End of year 261,272$
City of San Bernardino
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual
Verdemont Capital Projects Fund
For the Year Ended June 30, 2019
Budgeted Amounts
167
Variance with
Final Budget
Actual Positive
Original Final
Amounts (Negative)
REVENUES:
Use of money and property -$ -$ 250,919$ 250,919$
Charges for services - - 1,684,546 1,684,546
Total revenues - - 1,935,465 1,935,465
EXPENDITURES:
Current:
Streets
Public services 5,550,000 5,550,000 877,129 4,672,871
Total expenditures 5,550,000 5,550,000 877,129 4,672,871
CHANGE IN FUND BALANCE (5,550,000)$ (5,550,000)$ 1,058,336 6,608,336$
FUND BALANCE:
Beginning of year 7,780,817
End of year 8,839,153$
City of San Bernardino
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual
Storm Drain Construction Capital Projects Fund
For the Year Ended June 30, 2019
Budgeted Amounts
168
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES:
Taxes 1,221,928$ 1,221,928$ 1,219,836$ (2,092)$
Total revenues 1,221,928 1,221,928 1,219,836 (2,092)
EXPENDITURES:
Current:
Streets
Public services 1,477,264 1,552,381 1,411,550 140,831
Total expenditures 1,477,264 1,552,381 1,411,550 140,831
CHANGE IN FUND BALANCE (255,336)$ (330,453)$ (191,714) 138,739$
FUND BALANCE:
Beginning of year 155,723
End of year (35,991)$
City of San Bernardino
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual
Special Asessments Capital Projects Fund
For the Year Ended June 30, 2019
Budgeted Amounts
169
Variance with
Final Budget
Actual Positive
Original Final
Amounts (Negative)
REVENUES:
Licenses and Permits -$ -$ 731,690$ 731,690$
Use of money and property - - 134,455 134,455
Total revenues - - 866,145 866,145
EXPENDITURES:
Current:
General government
Nondepartmental 300,000 300,000 249,813 50,187
Total expenditures 300,000 300,000 249,813 50,187
CHANGE IN FUND BALANCE (300,000)$ (300,000)$ 616,332 916,332$
FUND BALANCE:
Beginning of year 4,260,395
End of year 4,876,727$
City of San Bernardino
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual
Cultural Development Construction Fee Capital Projects Fund
For the Year Ended June 30, 2019
Budgeted Amounts
170
Variance with
Final Budget
Actual Positive
Original Final
Amounts (Negative)
REVENUES:
Impact fees -$ -$ 1,858,064$ 1,858,064$
Use of money and property - - 549,015 549,015
Intergovernmental - - 375,525 375,525
Total revenues - - 2,782,604 2,782,604
EXPENDITURES:
Current:
Streets
Public services 3,911,500 3,989,405 772,099 3,217,306
Community service 214,700 563,700 347,545 216,155
Total expenditures 4,126,200 4,553,105 1,119,644 3,433,461
CHANGE IN FUND BALANCE (4,126,200)$ (4,553,105)$ 1,662,960 6,216,065$
FUND BALANCE:
Beginning of year 18,072,840
End of year 19,735,800$
City of San Bernardino
Schedule of Revenues, Expenditures, and Change in Fund Balance - Budget and Actual
Impact Fees Capital Projects Fund
For the Year Ended June 30, 2019
Budgeted Amounts
171
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172
INTERNAL SERVICE FUNDS
Internal Service Funds are used to finance and account for special activities and services performed by a designated
City department for other departments on a cost reimbursement basis. The City maintains the following Internal Service
Funds for the purposes indicated:
Workers' Compensation Fund -This fund is for administration of the City's self-insurance for workers'
compensation.
Information Systems Fund -This fund is used to account for the acquisition and maintenance of the City's
computer and emergency communications systems.
Motorpool Fund -This fund is used to account for the maintenance and operating costs for the City's fleet of
vehicles.
Liability Insurance Fund -This fund is for the administration of the City's liability claims, combined self-
insurance and umbrella coverage for liability.
173
Workers' Liability Information
Compensation Insurance Motorpool Systems Total
ASSETS
Current assets:
Cash and investments -$ 4,183,526$ 1,710,000$ -$ 5,893,526$
Accounts receivable 109,121 358,205 125,000 - 592,326
Due from other funds - 2,176,676 - - 2,176,676
Inventories - - 189,990 - 189,990
Prepaid items - - 2,484 - 2,484
Total current assets 109,121 6,718,407 2,027,474 - 8,855,002
Noncurrent assets:
Depreciable capital assets, net - - 149,052 1,216,308 1,365,360
Total noncurrent assets - - 149,052 1,216,308 1,365,360
Total assets 109,121 6,718,407 2,176,526 1,216,308 10,220,362
DEFERRED OUTFLOWS OF RESOURCES
Pension-related deferred outflows of resources 88,386 92,108 357,266 754,539 1,292,299
Total deferred outflows of resources 88,386 92,108 357,266 754,539 1,292,299
LIABILITIES
Current liabilities:
Accounts payable and accrued liabilities 203,037 1,301,862 116,586 123,349 1,744,834
Payroll and related liabilities 7,845 8,086 31,334 88,668 135,933
Due to other funds 2,176,676 - 131,975 220,358 2,529,009
Compensated absences - due within one year 3,409 3,580 18,104 40,627 65,720
Claims payable - due within one year 3,042,759 1,351,117 - - 4,393,876
Long-term debt - due within one year - - - 626,883 626,883
Total current liabilities 5,433,726 2,664,645 297,999 1,099,885 9,496,255
Noncurrent liabilities:
Advances from other fund - - 1,710,000 - 1,710,000
Aggregate net pension liability 960,241 1,000,672 3,881,393 8,197,422 14,039,728
Compensated absences - due in more than one year 7,955 8,354 42,243 94,796 153,348
Claims payable - due in more than one year 19,278,357 4,658,503 - - 23,936,860
Total noncurrent liabilities 20,246,553 5,667,529 5,633,636 8,292,218 39,839,936
Total liabilities 25,680,279 8,332,174 5,931,635 9,392,103 49,336,191
DEFERRED INFLOWS OF RESOURCES
Pension-related deferred inflows of resources 13,155 13,709 53,173 112,300 192,337
Total deferred inflows of resources 13,155 13,709 53,173 112,300 192,337
NET POSITION
Net investment in capital assets - - 149,052 589,425 738,477
Unrestricted (deficit) (25,495,927) (1,535,368) (3,600,068) (8,122,981) (38,754,344)
Total net position (25,495,927)$ (1,535,368)$ (3,451,016)$ (7,533,556)$ (38,015,867)$
(Concluded)
June 30, 2019
All Internal Service Funds
Combining Statement of Net Position
City of San Bernardino
174
Workers' Liability Information
Compensation Insurance Motorpool Systems Total
OPERATING REVENUES:
Charges for services 6,104,845$ 3,213,638$ 2,934,514$ 4,632,419$ 16,885,416$
Other 26,965 976,577 - - 1,003,542
Total operating revenues 6,131,810 4,190,215 2,934,514 4,632,419 17,888,958
OPERATING EXPENSES:
Cost of sales and services 1,964,531 2,122,566 3,602,727 4,478,175 12,167,999
Claims expense 3,644,907 2,067,649 - - 5,712,556
Amortization - - - 594,633 594,633
Depreciation - - 84,233 67,086 151,319
Total operating expenses 5,609,438 4,190,215 3,686,960 5,139,894 18,626,507
Operating income (loss)522,372 - (752,446) (507,475) (737,549)
NONOPERATING REVENUES (EXPENSES):
Interest expense and fiscal charges - - - (13,598) (13,598)
Miscellaneous income 2,000 - 8,821 377,873 388,694
Total nonoperating revenues (expenses)2,000 - 8,821 364,275 375,096
Changes in net position 524,372 - (743,625) (143,200) (362,453)
NET POSITION:
Beginning of year (26,020,299) (1,535,368) (2,707,391) (7,390,356) (37,653,414)
End of year (25,495,927)$ (1,535,368)$ (3,451,016)$ (7,533,556)$ (38,015,867)$
(Concluded)
City of San Bernardino
Combining Statement of Revenues, Expenses, and Changes in Net Position
All Internal Service Funds
For the Year Ended June 30, 2019
175
Workers' Liability Information
Compensation Insurance Motorpool Systems Total
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from user departments 5,935,251$ 2,950,328$ 2,941,489$ 4,370,494$ 16,197,562$
Cash payments to suppliers and employees
for goods and services (1,677,222) (482,058) (3,272,619) (4,084,288) (9,516,187)
Cash payments for claims and insurance (4,286,994) (1,229,773) - - (5,516,767)
Cash received from (paid for) other activities 26,965 976,577 - - 1,003,542
Net cash provided by (used in)
operating activities (2,000) 2,215,074 (331,130) 286,206 2,168,150
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:
Acquisition of capital assets - - (33,546) (41,206) (74,752)
Principal payments on long term debt - - - (609,275) (609,275)
Interest paid - - - (13,598) (13,598)
Net cash (used in) capital and
related financing activities - - (33,546) (664,079) (697,625)
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES:
Interfund borrowing - - 1,710,000 - 1,710,000
Other non-operating revenues 2,000 - 8,821 377,873 388,694
Net cash provided by noncapital
financing activities 2,000 - 1,718,821 377,873 2,098,694
Net change in cash and cash equivalents - 2,215,074 1,354,145 - 3,569,219
CASH AND CASH EQUIVALENTS:
Beginning of year - 1,968,452 355,855 - 2,324,307
End of year -$ 4,183,526$ 1,710,000$ -$ 5,893,526$
(Concluded)
All Internal Service Funds
Combining Statement of Cash Flows
City of San Bernardino
For the Year Ended June 30, 2019
176
Workers' Liability Information
Compensation Insurance Motorpool Systems Total
RECONCILIATION OF OPERATING INCOME
TO NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES:
Operating income (loss) 522,372$ -$ (752,446)$ (507,475)$ (737,549)$
Adjustments to reconcile operating income (loss) to
net cash provided by (used in) operating activities:
Depreciation and amortization - - 84,233 661,719 745,952
Changes in operating assets and liabilities:
Accounts receivable (83,959) (348,945) (125,000) 533 (557,371)
Due from other funds - 85,635 - - 85,635
Inventories - - (7,817) - (7,817)
Prepaids 375 700 (2,484) - (1,409)
Pension-related deferred outflows 95,835 46,058 419,394 955,788 1,517,075
Accounts payable 163,787 1,286,489 (28,101) (124,017) 1,298,158
Payroll and related liabilities 1,175 3,190 2,868 19,428 26,661
Due to other funds (85,635) - 131,975 (262,458) (216,118)
Aggregate net pension liability 43,554 313,157 16,723 (313,187) 60,247
Compensated absences (242) (48) 4,219 25,157 29,086
Claims and judgments payable (642,087) 837,876 - - 195,789
Pension-related deferred inflows (17,175) (9,038) (74,694) (169,282) (270,189)
Total adjustments (524,372) 2,215,074 421,316 793,681 2,905,699
Net cash provided by (used in)
operating activities (2,000)$ 2,215,074$ (331,130)$ 286,206$ 2,168,150$
(Concluded)
For the Year Ended June 30, 2019
All Internal Service Funds
Combining Statement of Cash Flows (Continued)
City of San Bernardino
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178
AGENCY FUNDS
Assessment District #977A - This fund is used to account for the collection of assessments from property owners
and for the remittance of such assessments to bondholders as required by the Improvement Bond Act of 1915 and
related California State statutes for this district.
Assessment District #977B - This fund is used to account for the collection of assessments from property owners
and for the remittance of such assessments to bondholders as required by the Improvement Bond Act of 1915 and
related California State statutes for this district.
Assessment District #1003 - This fund is used to account for the collection of assessments from property owners
and for the remittance of such assessments to bondholders as required by the Improvement Bond Act of 1915 and
related California State statutes for this district.
Special Deposits - This fund accounts for all deposits made by developers, other government agencies or others for
disposition under the terms for which the deposits were made.
Cemetery Perpetual Care - This fund accounts for all money collected for the perpetual maintenance of the City
owned and operated Cemetery.
FIDUCIARY FUNDS
The Agency Funds are used to account for assets held by the City in a trustee capacity for individuals, private
organizations, other governments, and/or other funds. The City maintains the following Agency Funds for the purposes
indicated:
179
Assessment Assessment Assessment
District District District Special
#977A #977B #1003 Deposits
ASSETS
Cash and investments 63,124$ 26,751$ 57,758$ 5,861,436$
Accounts receivable - - - 22,784
Interest receivable - - - 446,959
Total assets 63,124$ 26,751$ 57,758$ 6,331,179$
LIABILITIES
Accounts payable -$ -$ -$ 351,896$
Deposits payable - - - 5,979,283
Due to bondholders 63,124 26,751 57,758 -
Total liabilities 63,124$ 26,751$ 57,758$ 6,331,179$
(Continued)
June 30, 2019
City of San Bernardino
Combining Statement of Fiduciary Assets and Liabilities
Agency Funds
180
Cemetery
Perpetual
Care Total
ASSETS
Cash and investments 659,796$ 6,668,865$
Accounts receivable - 22,784
Interest receivable - 446,959
Total assets 659,796$ 7,138,608$
LIABILITIES
Accounts payable -$ 351,896$
Deposits payable 659,796 6,639,079
Due to bondholders - 147,633
Total liabilities 659,796$ 7,138,608$
(Concluded)
June 30, 2019
City of San Bernardino
Combining Statement of Fiduciary Assets and Liabilities (Continued)
Agency Funds
181
Balance Balance
July 1, 2018 Additions Deletions June 30, 2019
Assessment District #977A
Assets:
Cash and investments 63,124$ -$ -$ 63,124$
Total assets 63,124$ -$ -$ 63,124$
Liabilities:
Due to bondholders 63,124$ -$ -$ 63,124$
Total liabilities 63,124$ -$ -$ 63,124$
Assessment District #977B
Assets:
Cash and investments 26,751$ -$ -$ 26,751$
Total assets 26,751$ -$ -$ 26,751$
Liabilities:
Due to bondholders 26,751$ -$ -$ 26,751$
Total liabilities 26,751$ -$ -$ 26,751$
Assessment District #1003
Assets:
Cash and investments 57,758$ -$ -$ 57,758$
Total assets 57,758$ -$ -$ 57,758$
Liabilities:
Due to bondholders 57,758$ -$ -$ 57,758$
Total liabilities 57,758$ -$ -$ 57,758$
Special Deposits
Assets:
Cash and investments 4,107,897$ 1,753,539$ -$ 5,861,436$
Accounts receivable 61,146 - (38,362) 22,784
Interest receivable 385,928 61,031 - 446,959
Total assets 4,554,971$ 1,814,570$ (38,362)$ 6,331,179$
Liabilities:
Accounts payable 566,534$ -$ (214,638)$ 351,896$
Deposits payable 3,988,437 1,990,846 - 5,979,283
Total liabilities 4,554,971$ 1,990,846$ (214,638)$ 6,331,179$
City of San Bernardino
For Year Ended June 30, 2019
Agency Funds
Combining Statement of Changes in Fiduciary Assets and Liabilities
182
Balance Balance
July 1, 2018 Additions Deletions June 30, 2019
Cemetery Perpetual Care
Assets:
Cash and investments 659,796$ -$ -$ 659,796$
Total assets 659,796$ -$ -$ 659,796$
Liabilities:
Deposits payable 659,796$ -$ -$ 659,796$
Total liabilities 659,796$ -$ -$ 659,796$
Total All Agency Funds
Assets:
Cash and investments 4,915,326$ 1,753,539$ -$ 6,668,865$
Accounts receivable 61,146 - (38,362) 22,784
Interest receivable 385,928 61,031 - 446,959
Total assets 5,362,400$ 1,814,570$ (38,362)$ 7,138,608$
Liabilities:
Accounts payable 566,534$ -$ (214,638)$ 351,896$
Deposits payable 4,648,233 1,990,846 - 6,639,079
Due to bondholders 147,633 - - 147,633
Total liabilities 5,362,400$ 1,990,846$ (214,638)$ 7,138,608$
Combining Statement of Changes in Fiduciary Assets and Liabilities (Continued)
Agency Funds
For Year Ended June 30, 2019
City of San Bernardino
183
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184
STATISTICAL SECTION
(Unaudited)
185
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186
Net Position by Component 188
Changes in Net Position 190
Fund Balances of Governmental Funds 194
Changes in Fund Balances of Governmental Funds 196
Tax Revenues by Source - Governmental Funds 198
Assessed Value and Estimated Actual Value of Taxable Property 199
Taxable Sales by Category 200
Principal Sales Tax Remitters 203
Direct and Overlapping Property Tax Rates 204
Principal Property Taxpayers 205
Property Tax Levies and Collections 206
Top 10 Customers - Water, Sewer Treatment, Sewer Collection 207
Connections and Revenues by User Type - Water 208
Water Rate History - Minimum Monthly Charge 209
Connections and Revenues by User Type - Sewer Treatment 210
Sewer Treatment Rate History 211
Connections and Revenues by User Type - Sewer Collection 212
Sewer Collection Rate History 213
Ratio of Outstanding Debt by Type 214
Ratio of General Bonded Debt Outstanding 216
Schedule of Direct and Overlapping Bonded Debt 217
Legal Debt Margin 218
Debt Service Coverage 220
Demographic and Economic Statistics 221
Principal Employers 222
Budgeted Full-Time and Part-Time Positions by Function 223
Capital Asset Statistics 224
Operating Indicators by Function 225
Demographic and Economic Information - These schedules offer demographic and economic indicators to help the reader
understand the environment within which the City's financial activities take place and to help make comparisons over time and with
other governments.
Operating Information - These schedules contain information about the City's operations and resources to help the reader
understand how the City's financial information relates to the services the City provides and the activities it performs.
Sources: Unless otherwise noted, the information in these schedules is derived from the Comprehensive Annual Financial Reports for
the relevant year.
STATISTICAL SECTION
This section of the City of San Bernardino's Comprehensive Annual Financial Report presents detailed information as a context for
understanding what the information in the financial statements, note disclosures, and required supplementary information says about
the City's overall financial health.
Financial Trends Schedules - These schedules contain trend information to help the reader understand how the City's financial
performance and well-being have changed over time.
Revenue Capacity Schedules - These schedules contain information to help the reader assess the factors affecting the City's ability
to generate its property and sales taxes, as well as proprietary revenues for the City's Water, Sewer Treatment, and Sewer Collection
services.
Debt Capacity Schedules - These schedules present information to help the reader assess the affordability of the City's current levels
of outstanding debt and the City's ability to issue additional debt in the future.
187
2010 2011 2012 2013 2014
Governmental activities:
Net investment in capital assets 417,644,510$ 425,705,511$ 394,655,658$ 377,287,488$ 366,632,191$
Restricted 188,976,306 197,685,282 112,634,171 109,448,652 117,670,005
Unrestricted (220,895,189) (260,861,339) (126,831,648) (133,128,461) (74,661,663)
Total governmental activities
net assets 385,725,627$ 362,529,454$ 380,458,181$ 353,607,679$ 409,640,533$
Business-type activities:
Net investment in capital assets 200,989,638$ 204,367,733$ 212,255,999$ 191,109,595$ 206,293,601$
Restricted 11,992,059 8,276,462 7,389,246 7,799,773 61,537,004
Unrestricted 39,723,816 41,372,198 40,727,533 63,679,374 10,563,420
Total primary government
net assets 252,705,513$ 254,016,393$ 260,372,778$ 262,588,742$ 278,394,025$
Primary government:
Net investment in capital assets 618,634,148$ 630,073,244$ 606,911,657$ 568,397,083$ 572,925,792$
Restricted 200,968,365 205,961,744 120,023,417 117,248,425 179,207,009
Unrestricted (181,171,373) (219,489,141) (86,104,115) (69,449,087) (64,098,243)
Total primary government
net assets 638,431,140$ 616,545,847$ 640,830,959$ 616,196,421$ 688,034,558$
Source: City Finance Department
Fiscal Year
City of San Bernardino
Net Assets by Component
Last Ten Fiscal Years
(accrual basis of accounting)
188
2015 2016 2017 2018 2019
Governmental activities:
Net investment in capital assets 357,760,150$ 346,538,460$ 316,218,375$ 291,168,979$ 286,878,015$
Restricted 100,668,315 126,717,096 106,923,136 114,629,131 97,721,801
Unrestricted (384,440,896) (388,600,709) (257,124,872) (306,072,272) (306,956,031)
Total governmental activities
net assets 73,987,569$ 84,654,847$ 166,016,639$ 99,725,838$ 77,643,785$
Business-type activities:
Net investment in capital assets 223,104,368$ 235,670,073$ 250,399,481$ 248,654,078$ 259,671,498$
Restricted 60,084,163 58,331,021 7,944,758 8,363,037 33,999,584
Unrestricted (47,561,359) (39,100,089) 29,139,574 26,485,780 2,566,757
Total business-type activities
net assets 235,627,172$ 254,901,005$ 287,483,813$ 283,502,895$ 296,237,839$
Primary government:
Net investment in capital assets 580,864,518$ 582,208,533$ 566,617,856$ 539,823,057$ 546,549,513$
Restricted 160,752,478 185,048,117 114,867,894 122,992,168 131,721,385
Unrestricted (432,002,255) (427,700,798) (227,985,298) (279,586,492) (304,389,274)
Total primary government
net assets 309,614,741$ 339,555,852$ 453,500,452$ 383,228,733$ 373,881,624$
Source: City Finance Department
(accrual basis of accounting)
Fiscal Year
City of San Bernardino
Net Assets by Component (Continued)
Last Ten Fiscal Years
189
2010 2011 2012 2013 2014
Expenses:
Governmental activities:
General Government 30,091,111$ 22,992,136$ 22,915,176$ 19,896,979$ 18,045,239$
Public Safety 96,151,341 106,367,139 108,865,770 95,824,587 90,844,424
Streets 26,308,728 31,801,002 30,143,061 27,584,040 28,371,459
Culture and Recreation 5,682,806 7,112,156 7,649,897 6,258,991 8,053,521
Community Development 48,315,410 47,557,048 33,679,934 6,123,668 2,944,616
Community Service 9,092,811 11,223,506 7,823,261 6,360,346 6,062,512
Interest on long-term debt 13,852,035 13,299,213 7,234,246 2,383,832 6,324,491
Total governmental activities
expenses 229,494,242 240,352,200 218,311,345 164,432,443 160,646,262
Business-type activities:
Integrated Waste 23,871,383 24,172,161 26,931,095 24,643,145 20,306,358
Water 32,608,484 36,343,754 39,951,698 38,302,554 36,303,452
Sewer 26,037,956 24,072,074 23,232,878 23,231,158 23,753,540
Sewer Collection - - - - -
Total business-type activities
expenses 82,517,823 84,587,989 90,115,671 86,176,857 80,363,350
Total primary government
expenses 312,012,065 324,940,189 308,427,016 250,609,300 241,009,612
Program revenues:
Governmental activities:
Charges for services:
General Government 4,035,539 509,158 3,466,570 4,738,387 2,496,930
Public Safety 8,397,172 7,696,287 8,399,399 8,210,410 5,921,344
Streets 7,611,158 6,357,593 6,476,362 8,405,822 7,907,263
Culture and Recreation 1,897,352 1,009,023 965,629 1,278,495 766,853
Community Development 3,681,075 4,413,761 4,981,622 4,621,495 4,025,505
Economic Development - - - - -
Community Service 1,539,532 1,869,805 322,873 329,359 56,056
Operating grants and contributions 29,834,546 33,138,747 26,312,461 14,620,794 14,853,177
Capital grants and contributions 8,127,158 15,689,230 11,305,306 9,562,325 11,141,515
Total governmental activities
program revenues 65,123,532 70,683,604 62,230,222 51,767,087 47,168,643
(Continued)
Source: City Finance Department
Fiscal Year
City of San Bernardino
Changes in Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
190
2010 2011 2012 2013 2014
Business-Type activities:
Charges for services:
Integrated Waste 26,074,292 24,529,480 24,371,665 24,968,040 24,911,930
Water 27,688,694 33,027,707 37,106,217 37,868,846 35,968,790
Sewer 22,424,943 23,433,833 25,888,729 26,414,653 25,350,989
Sewer Collection - - - - -
Operating grants and contributions 1,894,624 1,928,999 1,838,223 3,110,201 2,030,066
Capital grants and contributions 6,325,571 4,390,162 3,055,921 4,896,921 7,510,777
Total business-type activities
program revenues 84,408,124 87,310,181 92,260,755 97,258,661 95,772,552
Total primary government
program revenues 149,531,656 157,993,785 154,490,977 149,025,748 142,941,195
Net revenues (expenses):
Governmental activities (164,370,710) (169,668,596) (156,081,123) (112,665,356) (113,477,619)
Business-type activities 1,890,301 2,722,192 2,145,084 11,081,804 15,409,202
Total net revenues (expenses) (162,480,409) (166,946,404) (153,936,039) (101,583,552) (98,068,417)
General revenues and other changes in net assets:
Governmental activities:
Taxes:
Sales tax 25,569,302 29,378,969 32,347,377 34,337,173 30,420,582
Property tax 63,565,610 63,442,311 46,708,872 28,103,713 38,885,226
Other taxes 31,087,543 31,124,606 30,911,640 32,873,019 32,573,029
Franchise tax 3,125,973 3,164,830 3,268,800 3,356,643 3,749,762
Investment income (unrestricted) 1,112,028 2,262,551 - 688,248 892,498
Other general revenues 11,213,503 10,036,775 4,824,838 4,991,985 4,731,890
Intergovernmental (unrestricted) 853,324 1,068,331 - - 2,105
Gain (loss) on sale of capital assets - 2,546,550 - - -
Extraordinary item:
Gain on dissolution of economic
development agency - - 49,844,437 - -
Annexation of City Fire Dept by County - - - - -
Discontinuance of Solid Waste Ops - - - - -
Long-Range Property Mgmt Plan - - - - -
Loss on transfer of sewer collection operations - - - - -
Chapter 9 Bankruptcy Settlement - - - - -
Notes Receivable adjustment - - - - -
Transfers 3,511,700 3,447,500 (65,000) 2,200,000 2,200,000
Total governmental activities 140,038,983 146,472,423 167,840,964 106,550,781 113,455,092
Business-type activities
Investment income (unrestricted) 2,333,045 1,410,638 1,031,912 287,469 581,185
Other revenues 540,421 625,550 1,444,963 296,440 1,884,946
Gain (loss) on disposal of capital assets - - - - (11,798)
Extraordinary item:
Discontinuance of Solid Waste Ops - - - - -
Chapter 9 Bankruptcy Settlement - - - - -
Transfers (3,511,700) (3,447,500) 65,000 (2,200,000) (2,200,000)
Total business-type activities (638,234) (1,411,312) 2,541,875 (1,616,091) 254,333
Total primary government 139,400,749 145,061,111 170,382,839 104,934,690 113,709,425
Changes in net assets:
Governmental activities (24,331,727) (23,196,173) 11,759,841 (6,114,575) (22,527)
Business-type activities 1,252,067 1,310,880 4,686,959 9,465,713 15,663,535
Total primary government (23,079,660)$ (21,885,293)$ 16,446,800$ 3,351,138$ 15,641,008$
(Continued)
Source: City Finance Department
(accrual basis of accounting)
Fiscal Year
City of San Bernardino
Changes in Net Position (Continued)
Last Ten Fiscal Years
191
2015 2016 2017 2018 2019
Expenses:
Governmental activities:
General Government 23,792,572$ 29,434,611$ 41,953,597$ 29,093,189$ 29,494,169$
Public Safety 93,758,051 85,867,627 74,606,563 97,710,294 98,603,681
Streets 29,610,950 32,928,851 32,621,290 33,332,099 44,613,103
Culture and Recreation 10,805,969 7,589,992 6,504,874 8,474,953 3,712,899
Community Development 3,060,294 4,443,029 5,085,625 4,808,376 5,796,931
Community Service 5,684,705 3,261,649 2,233,081 2,723,132 4,195,874
Interest on long-term debt 3,994,357 3,713,051 1,046,882 1,126,611 861,785
Total governmental activities
expenses 170,706,898 167,238,810 164,051,912 177,268,654 187,278,442
Business-type activities:
Integrated Waste 19,640,062 15,323,676 1,183,561 1,177,266 777,167
Water 35,673,702 34,941,060 40,205,419 36,461,897 35,988,661
Sewer 19,501,609 20,015,296 26,638,434 25,258,155 27,787,317
Sewer Collection - - 1,054,866 11,667,157 8,172,922
Total business-type activities
expenses 74,815,373 70,280,032 69,082,280 74,564,475 72,726,067
Total primary government
expenses 245,522,271 237,518,842 233,134,192 251,833,129 260,004,509
Program revenues:
Governmental activities:
Charges for services:
General Government 2,459,211 6,877,634 2,563,248 3,069,172 1,057,221
Public Safety 5,242,941 5,759,696 4,089,638 4,806,016 7,770,680
Streets 12,826,107 12,388,167 10,850,828 7,380,078 6,158,572
Culture and Recreation 1,397,431 2,785,816 892,502 1,003,421 1,416,584
Community Development 579,930 5,404,887 4,839,812 4,944,299 3,941,191
Economic Development - - - - -
Community Service 104,608 614,304 33,793 37,200 45,838
Operating grants and contributions 17,883,362 11,865,542 7,263,130 21,652,775 24,378,835
Capital grants and contributions 9,801,186 9,031,491 8,230,994 283,942 270,819
Total governmental activities
program revenues 50,294,776 54,727,537 38,763,945 43,176,903 45,039,740
(Continued)
Source: City Finance Department
Fiscal Year
City of San Bernardino
Changes in Net Position (Continued)
Last Ten Fiscal Years
(accrual basis of accounting)
192
2015 2016 2017 2018 2019
Business-Type activities:
Charges for services:
Integrated Waste 25,212,322 19,547,672 644,710 503,657 500,242
Water 32,334,811 29,388,782 32,883,423 37,786,156 38,819,578
Sewer 24,399,415 25,030,569 28,022,259 30,030,737 29,849,642
Sewer Collection - - 2,860,627 7,679,020 7,555,960
Operating grants and contributions 2,089,637 1,696,219 2,047,946 1,776,883 1,832,879
Capital grants and contributions 4,977,945 4,271,325 3,551,138 4,854,784 10,121,344
Total business-type activities
program revenues 89,014,130 79,934,567 70,010,103 82,631,237 88,679,645
Total primary government
program revenues 139,308,906 134,662,104 108,774,048 125,808,140 133,719,385
Net revenues (expenses):
Governmental activities (120,412,122) (112,511,273) (125,287,967) (134,091,751) (142,238,702)
Business-type activities 14,198,757 9,654,535 927,823 8,066,762 15,953,578
Total net revenues (expenses) (106,213,365) (102,856,738) (124,360,144) (126,024,989) (126,285,124)
General revenues and other changes in net assets:
Governmental activities:
Taxes:
Sales tax 31,187,510 36,680,419 43,641,309 43,890,011 49,450,785
Property tax 40,571,180 41,344,972 13,749,684 18,498,848 17,101,369
Other taxes 34,554,151 36,498,187 35,491,197 36,806,979 36,092,568
Franchise tax 3,900,853 4,925,012 10,777,853 10,657,848 11,550,447
Investment income (unrestricted) 856,229 1,613,925 674,345 1,479,966 3,864,707
Other general revenues 4,324,380 4,157,249 3,678,262 4,957,964 2,096,773
Intergovernmental (unrestricted) 1,001 - - - -
Gain (loss) on sale of capital assets - (1,130,211) (446,020) (21,932) -
Extraordinary item:
Gain on dissolution of economic
development agency - - - - -
Annexation of City Fire Dept by County - (5,010,868) - - -
Discontinuance of Solid Waste Ops - (10,069,000) - - -
Long-Range Property Mgmt Plan - - 46,766,207 - -
Loss on transfer of sewer collection operations - - (8,376,366) - -
Chapter 9 Bankruptcy Settlement - - 76,034,666 - -
Notes Receivable adjustment - - - (24,902,675) -
Transfers 2,200,000 14,168,866 (27,798,309) 590,005 -
Total governmental activities 117,595,304 123,178,551 194,192,828 91,957,014 120,156,649
Business-type activities
Investment income (unrestricted) 635,061 875,707 129,944 534,899 3,112,261
Other revenues 2,348,834 2,072,951 1,567,787 1,696,912 2,044,179
Gain (loss) on disposal of capital assets - - (1,123,192) 52,419 -
Extraordinary item:
Discontinuance of Solid Waste Ops - 20,839,506 - - -
Chapter 9 Bankruptcy Settlement - - 55,787 - -
Transfers (2,200,000) (14,168,866) 31,024,659 - (8,375,074)
Total business-type activities 783,895 9,619,298 31,654,985 2,284,230 (3,218,634)
Total primary government 118,379,199 132,797,849 225,847,813 94,241,244 116,938,015
Changes in net assets:
Governmental activities (2,816,818) 10,667,278 68,904,861 (42,134,737) (22,082,053)
Business-type activities 14,982,652 19,273,833 32,582,808 10,350,992 12,734,944
Total primary government 12,165,834$ 29,941,111$ 101,487,669$ (31,783,745)$ (9,347,109)$
(Concluded)
Source: City Finance Department
(accrual basis of accounting)
Fiscal Year
City of San Bernardino
Changes in Net Position (Continued)
Last Ten Fiscal Years
193
2010(1)2011(1)2012(1)2013(1)2014(1)
General fund:
Reserved 1,107,232$ -$ -$ -$ -$
Unreserved (696,939) - - - -
Nonspendable - 101,054 95,306 74,376 415,286
Restricted - - - - 1,208,016
Committed - - - - 1,439,131
Assigned - - - - -
Unassigned - (1,282,658) (12,304,390) (7,220,531) 10,327,070
Total general fund 410,293 (1,181,604) (12,209,084) (7,146,155) 13,389,503
All other governmental funds:
Reserved 189,764,830 - - - -
Unreserved, reported in:
Special revenue funds (14,349,535) - - - -
Debt service funds (581,544) - - - -
Capital project funds 23,607,604 - - - -
Nonspendable - 2,962,070 - 200,000 77,284,512
Restricted - 242,457,518 104,770,342 107,731,704 38,718,920
Committed - 356,373 589,180 - -
Assigned - 118,462 79,971 - -
Unassigned - (40,459,403) (3,240,711) (2,504,245) (682,322)
Total all other governmental funds 198,441,355$ 205,435,020$ 102,198,782$ 105,427,459$ 115,321,110$
(1) The City implemented Governmental Accounting Standards Board Statement No. 54 (GASB 54) beginning fiscal year ended June 30, 2011.
Source: City Finance Department
Fiscal Year
City of San Bernardino
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
194
2015(1)2016(1)2017(1)2018(1)2019(1)
General fund:
Reserved -$ -$ -$ -$ -$
Unreserved - - - - -
Nonspendable 635,493 516,258 40,858,145 33,023,125 32,855,157
Restricted 1,226,630 1,270,317 543,011 3,351 73,416
Committed 905,724 53,451 133,282 68,387 68,387
Assigned - - - - -
Unassigned 15,260,350 32,571,653 30,218,397 38,995,689 31,543,452
Total general fund 18,028,197 34,411,679 71,752,835 72,090,552 64,540,412
All other governmental funds:
Reserved - - - - -
Unreserved, reported in:
Special revenue funds - - - - -
Debt service funds - - - - -
Capital project funds - - - - -
Nonspendable 65,167,831 44,059 59,093,468 300 -
Restricted 47,298,125 114,064,965 48,460,477 89,723,105 97,648,385
Committed - - - - -
Assigned - - - - -
Unassigned (906,217) (87,413) (32,806) - (35,991)
Total all other governmental funds 111,559,739$ 114,021,611$ 107,521,139$ 89,723,405$ 97,612,394$
Source: City Finance Department
Fiscal Year
City of San Bernardino
Fund Balances of Governmental Funds (Continued)
Last Ten Fiscal Years
(modified accrual basis of accounting)
195
2010 2011 2012 2013 2014
Revenues:
Taxes 120,443,480$ 123,896,615$ 109,518,983$ 94,933,808$ 104,126,781$
Licenses and permits 8,796,052 8,516,516 10,243,232 10,636,856 9,706,800
Impact fees 2,036,352 618,030 239,553 1,771,424 1,761,012
Fines and forfeitures 5,850,072 2,338,684 1,973,047 1,844,472 2,490,649
Investment Income 4,191,386 2,485,053 1,148,831 688,248 549,969
Lease - - 2,049,151 12,942 704,726
Intergovernmental 42,318,633 48,775,893 34,030,047 25,797,462 23,691,032
Charges for services 10,932,430 12,886,715 12,325,700 12,091,896 11,408,243
Other 8,603,639 8,925,459 8,036,027 6,370,315 4,613,341
Total revenues 203,172,044 208,442,965 179,564,571 154,147,423 159,052,553
Expenditures:
Current:
General Government 23,815,033 17,234,673 21,691,566 16,293,262 17,285,460
Public Safety 96,130,768 101,657,184 102,876,767 94,108,772 87,314,975
Streets 20,267,012 24,433,688 16,780,012 13,985,990 18,506,025
Culture and Recreation 5,228,540 6,579,287 7,522,783 5,267,641 7,398,022
Community Development 12,817,428 15,901,097 9,852,580 5,607,114 2,828,621
Community Service 9,150,336 10,266,256 7,967,618 5,358,123 5,682,896
Economic Development 34,168,768 29,735,854 18,074,203 - -
Debt service:
Principal retirement 12,285,742 12,627,234 9,872,237 4,784,483 3,838,738
Interest and fiscal charges 13,420,944 13,745,859 9,716,214 1,538,016 2,559,661
Total expenditures 227,284,571 232,181,132 204,353,980 146,943,401 145,414,398
Excess (deficiency) of revenues
over (under) expenditures (24,112,527) (23,738,167) (24,789,409) 7,204,022 13,638,155
Other financing sources (uses):
Transfers in 38,698,615 33,952,713 38,439,148 2,616,226 6,960,097
Transfers out (34,665,002) (30,530,449) (36,494,374) (416,226) (4,757,992)
Issuance of long-term debt 4,227,490 23,171,122 18,000,000 - -
Sale of capital assets 1,930,000 2,546,549 (5,248,157) 142,473 -
Total other financing
sources (uses) 10,191,103 29,139,935 14,696,617 2,342,473 2,202,105
Extraordinary item:
Gain (loss) on dissolution of
economic development agency - - (110,339,812) - -
LRPMP Transfers from Successor Agency - - - - -
Chapter 9 Bankruptcy Settlement - - - - -
Notes Receivable adjustment - - - - -
Net change in fund balances (13,921,424)$ 5,401,768$ (120,432,604)$ 9,546,495$ 15,840,260$
Expenditures for capitalized assets 10,120,207 11,047,330 4,585,686 3,343,257 5,932,143
Debt service as a percentage of
noncapital expenditures 11.8% 11.9% 9.8% 4.4% 4.6%
Source: City Finance Department
Fiscal Year
City of San Bernardino
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
196
2015 2016 2017 2018 2019
Revenues:
Taxes 108,248,780$ 116,474,108$ 101,310,156$ 106,751,261$ 111,195,458$
Licenses and permits 11,226,693 11,515,983 10,646,234 12,021,242 12,305,689
Impact fees 2,915,704 2,409,364 2,690,413 2,494,953 1,858,064
Fines and forfeitures 1,859,659 2,642,998 2,268,213 2,476,338 2,737,250
Investment Income 808,225 1,528,158 693,247 683,016 3,182,715
Lease 396,250 569,583 734,853 1,367,014 1,099,730
Intergovernmental 23,211,589 16,672,907 12,581,942 18,615,104 21,464,810
Charges for services 10,432,822 13,124,068 10,536,949 8,653,717 8,772,298
Other 5,851,039 9,843,361 5,311,574 6,150,859 3,015,369
Total revenues 164,950,761 174,780,530 146,773,581 159,213,504 165,631,383
Expenditures:
Current:
General Government 23,028,342 30,023,905 41,208,970 27,143,743 23,544,245
Public Safety 86,113,657 90,994,899 63,871,615 77,574,446 84,537,639
Streets 16,779,236 20,009,090 19,562,136 21,471,387 40,588,569
Culture and Recreation 10,015,698 7,549,588 6,188,786 8,034,662 3,425,100
Community Development 3,550,617 4,501,617 4,978,005 4,608,360 5,756,424
Community Service 5,109,127 3,204,997 2,586,926 2,302,476 3,773,249
Economic Development - - - - -
Debt service:
Principal retirement 9,897,441 12,771,410 7,782,077 5,955,768 1,971,120
Interest and fiscal charges 1,488,074 1,009,214 946,770 1,202,292 872,500
Total expenditures 155,982,192 170,064,720 147,125,285 148,293,134 164,468,846
Excess (deficiency) of revenues
over (under) expenditures 8,968,569 4,715,810 (351,704) 10,920,370 1,162,537
Other financing sources (uses):
Transfers in 3,087,398 15,153,355 7,133,534 590,005 1,491,125
Transfers out (886,397) (1,023,811) (16,487,965) (229,655) (1,491,125)
Issuance of long-term debt - - - 4,414,002 -
Sale of capital assets - - (254,169) - (823,688)
Total other financing
sources (uses) 2,201,001 14,129,544 (9,608,600) 4,774,352 (823,688)
Extraordinary item:
Gain (loss) on dissolution of
economic development agency - - - - -
LRPMP Transfers from Successor Agency - - 38,848,755 - -
Chapter 9 Bankruptcy Settlement - - 1,952,233 - -
Notes Receivable adjustment - - - (24,902,675) -
Net change in fund balances 11,169,570$ 18,845,354$ 30,840,684$ (9,207,953)$ 338,849$
Expenditures for capitalized assets 5,682,353 3,658,379 3,702,189 5,807,791 10,386,763
Debt service as a percentage of
noncapital expenditures 7.6% 8.3% 6.1% 5.0% 1.8%
Source: City Finance Department
Fiscal Year
City of San Bernardino
Changes in Fund Balances of Governmental Funds (Continued)
Last Ten Fiscal Years
(modified accrual basis of accounting)
197
Fiscal Year
Ended Property Sales Franchise Utilities User Transient Other
June 30 Tax Tax Tax Tax Occupancy Tax Taxes Total
2010 63,565,610 25,569,302 3,125,973 22,630,460 2,222,113 6,234,970 123,348,428
2011 63,442,311 29,378,969 3,164,830 22,089,888 2,507,283 6,527,435 127,110,716
2012 46,708,872 32,347,377 3,268,800 22,127,129 2,217,325 6,567,186 113,236,689
2013 28,103,713 34,337,173 3,356,643 23,159,846 2,921,980 6,791,193 98,670,548
2014 38,885,226 30,420,582 3,749,762 22,498,934 2,935,962 7,138,133 105,628,599
2015 40,571,180 31,187,510 3,900,853 23,921,806 3,463,262 7,169,083 110,213,694
2016 41,344,972 36,680,419 4,925,012 23,986,813 4,327,091 8,184,283 119,448,590
2017 13,749,684 43,641,309 10,777,853 23,591,923 4,502,185 7,397,089 103,660,043
2018 18,498,848 43,890,011 10,657,848 23,666,459 4,987,491 8,153,029 109,853,686
2019 17,101,369 49,450,785 11,550,447 22,924,522 4,950,170 8,217,876 114,195,169
City of Sand Bernardino
Tax Revenues by Source - Governmental Funds
Last Ten Fiscal Years
198
Fiscal Year Taxable Taxable Total
Ended Less Assessed Less Assessed Direct Tax
June 30 Secured Unsecured Exemptions Value Secured Unsecured Exemptions Value Rate
2010 5,185,425,176 260,923,761 (143,959,857) 5,302,389,080 5,120,754,081 577,948,187 - 5,698,702,268 0.43%
2011 4,956,261,271 252,261,265 (143,550,006) 5,064,972,530 4,678,734,272 602,483,225 - 5,281,217,497 0.43%
2012 4,959,942,790 252,999,295 (141,201,758) 5,071,740,327 4,486,175,902 607,066,114 - 5,093,242,016 0.43%
2013 5,023,911,140 305,587,154 (137,553,197) 5,191,945,097 4,426,602,803 557,995,407 - 4,984,598,210 0.42%
2014 5,147,376,701 396,277,023 (133,837,593) 5,409,816,131 4,564,949,325 586,585,698 - 5,151,535,023 0.17%
2015 5,473,438,440 346,724,646 (130,541,256) 5,689,621,830 4,786,710,713 691,242,385 - 5,477,953,098 0.17%
2016 5,738,959,843 312,079,238 (128,316,274) 5,922,722,807 5,141,903,516 720,777,168 - 5,862,680,684 0.17%
2017 5,981,441,663 325,997,592 (133,119,032) 6,174,320,223 5,689,891,753 661,264,210 - 6,351,155,963 0.17%
2018 6,304,981,676 348,471,031 (130,446,387) 6,523,006,320 6,058,430,422 675,636,279 - 6,734,066,701 0.01%
2019 6,568,149,924 388,910,383 (127,261,499) 6,829,798,808 6,575,428,405 657,727,943 - 7,233,156,348 0.00%
Note: Estimated value of taxable property not readily available in the State of California. The assessed valuation data shown above represents the only data currently
available with respect to the actual market value of taxable property and is subject to the limitations of Proposition 13 passed in 1978.
Source: HdL, Coren & Cone, San Bernardino County Auditor/Controller
(1) Redevelopment Agency was dissolved on February 1, 2012.
City of San Bernardino
Assessed Value and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
City Redevelopment Agency
(1)
199
2009 2010 2011 2012 2013
Apparel Stores 84,539$ 90,419$ 96,167$ 99,537$ 108,646$
General Merchandise 361,470 361,075 376,398 395,002 409,662
Food Stores 72,507 74,798 75,885 76,724 73,363
Eating and Drinking Places 252,136 249,832 260,067 267,626 275,248
Building Materials 187,455 200,814 205,144 202,615 218,617
Auto Dealers and Supplies 231,989 253,219 304,857 337,231 389,457
Service Stations 248,124 269,261 326,498 354,383 343,211
Other Retail Stores 317,956 306,945 307,039 312,864 317,545
All Other Outlets 474,114 494,561 593,962 668,733 753,960
Total 2,230,290$ 2,300,924$ 2,546,017$ 2,714,715$ 2,889,709$
Note: Due to confidentiality issues, the names of the ten largest revenue payers are not available. The categories presented are intended to provide
alternative information regarding the sources of the City's revenue.
Sources: State Board of Equalization, California Department of Taxes and Fees Administration, State Controller's Office, The HdL Companies
Calendar Year
City of San Bernardino
Taxable Sales by Category
Last Ten Calendar Years
(in thousands of dollars)
200
2014 2015 2016 2017 2018
Apparel Stores 117,123$ 121,778$ 124,213$ 123,220$ 130,457$
General Merchandise 419,542 433,719 435,341 450,489 456,565
Food Stores 76,856 79,474 85,633 84,848 91,187
Eating and Drinking Places 296,399 320,304 337,469 362,303 378,339
Building Materials 240,632 249,553 265,323 277,395 294,083
Auto Dealers and Supplies 423,024 454,933 490,109 524,118 490,259
Service Stations 330,727 291,942 268,125 293,393 337,616
Other Retail Stores 317,133 340,705 341,002 340,216 366,959
All Other Outlets 847,943 913,442 999,364 1,064,621 1,205,531
Total 3,069,379$ 3,205,850$ 3,346,579$ 3,520,603$ 3,750,996$
Sources: State Board of Equalization, California Department of Taxes and Fees Administration, State Controller's Office, The HdL Companies
Note: Due to confidentiality issues, the names of the ten largest revenue payers are not available. The categories presented are intended to provide
alternative information regarding the sources of the City's revenue.
City of San Bernardino
Taxable Sales by Category (Continued)
Last Ten Calendar Years
(in thousands of dollars)
Calendar Year
201
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202
Business Name Business Category Business Name Business Category
Allied Building Products Building Materials Arco AM PM Service Stations
Best Buy Electronics/Appliance Stores Barr Lumber Building Materials
Chaparral Motorsports Boats/Motorcycles Best Buy Electronics/Appliance Stores
Chevron Service Stations Chaparral Motorsports Boats/Motorcycles
Costco Discount Dept Stores Chevron Service Stations
Crest Chevrolet New Motor Vehicle Dealers Circle K 76 Service Stations
Fairview Ford New Motor Vehicle Dealers Costco Discount Dept Stores
Greenbrier Rail Services Transportation-Non-Auto Crest Chevrolet New Motor Vehicle Dealers
Home Depot Building Materials Fairview Ford New Motor Vehicle Dealers
Hub Construction Specialties Building Materials Home Depot Building Materials
Inland Water Works Supply Heavy Industrial Inland Water Works Supply Heavy Industrial
Interline Brands Plumbing/Electrical Supplies Interline Brands Plumbing/Electrical Supplies
Kohls Distribution Center Fulfillment Centers John Ray Co Building Materials
Larry H Miller Nissan San Bernardino New Motor Vehicle Dealers KCI USA Medical Supplies Medical/Biotech
Macys Department Stores Lowes Building Materials
Moss Bros Chrysler Dodge Jeep Ram Fiat New Motor Vehicle Dealers Macys Department Stores
Ross Family Apparel Moss Bros Chrysler Dodge Jeep Ram Fiat New Motor Vehicle Dealers
Sams Club w/ Fuel Discount Dept Stores Nissan of San Bernardino New Motor Vehicle Dealers
San Manuel Band Of Mission Indians Leisure/Entertainment Omnitrans Transportation/Rentals
Stater Bros Grocery Stores Sams Club w/ Fuel Discount Dept Stores
Target Discount Dept Stores Sears Department Stores
Toyota/Subaru of San Bernardino New Motor Vehicle Dealers Stater Bros Grocery Stores
United Oil Service Stations Target Discount Dept Stores
USA Gasoline Service Stations Toyota/Subaru of San Bernardino New Motor Vehicle Dealers
Walmart Supercenter Discount Dept Stores Walmart Supercenter Discount Dept Stores
*Firms listed alphabetically
Source: The HdL Companies, State Board of Equalization
Fiscal Year 2019 Fiscal Year 2010
City of San Bernardino
Principal Sales Tax Remitters
Current Year and Nine Years Ago
203
Agency 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Basic Levy(1)1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000
Colton Unified School Board 0.09850 0.13040 0.14030 0.14880 0.11870 0.09730 0.11690 0.14540 0.09390 0.11160
Crestline-Lake Arrowhead Water Agency - Bond 0.00000 0.00000 0.05280 0.05510 0.05600 0.07250 0.07280 0.07280 0.08700 0.08700
Redlands Unified School Bond 1993 0.05410 0.06170 0.05820 0.06410 0.06290 0.05940 0.05670 0.05240 0.04940 0.03240
Rialto Unified School Bond 0.06590 0.07880 0.08560 0.07360 0.07040 0.06550 0.11940 0.09920 0.09570 0.07710
San Bernardino Community College Bond 0.02800 0.04670 0.03730 0.04590 0.04190 0.03930 0.04030 0.03500 0.03760 0.04070
San Bernardino Debt Service 0.03550 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000
San Bernardino Unified School Bond 0.07470 0.08840 0.09780 0.09980 0.13500 0.10810 0.11820 0.07950 0.10070 0.11260
San Bernardino Valley Muni Water 0.16500 0.16500 0.16500 0.16250 0.16250 0.16250 0.16250 0.16250 0.15250 0.15250
Total Direct and Overlapping Rates(2)1.52170 1.57100 1.63700 1.64980 1.64740 1.60460 1.68680 1.64680 1.61680 1.61390
City's Share of 1% Levy Per Prop 13(3)0.16897 0.16897 0.16897 0.16897 0.16897 0.16897 0.16897 0.16897 0.00000 0.00000
Voter Approved City Debt Rate 0.03550 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000
Redevelopment Rate(4)1.16500 1.16500 1.16500 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000
Total Direct Rates(5)0.42945 0.43116 0.42657 0.41962 0.16973 0.16974 0.16975 0.16975 0.00886 0.00000
(2) Overlapping rates are those of local and county governments that apply to property owners within the City. Not all overlapping rates apply to all property owners.
(3)City's Share of 1% Levy is based on the City's share of the general fund tax rate area with the largest net taxable value within the City. The ERAF portion of the
City's Levy has been subtracted where known.
(4)Redevelopment Rate is based on the largest RDA tax rate area and only includes rate(s) from indebtedness adopted prior to 1989 per California State statute. RDA
direct and overlapping rates are applied only to the incremental property values. The approval of ABX1 26 eliminated Redevelopment from the State of California for
the fiscal year 2012/13 and years thereafter.
(5)Total Direct Rate is the weighted average of all individual direct rates applied by the City preparing the statistical section information and excludes revenues
derived from aircraft. Beginning in fiscal year 2013-14, the Total Direct Rate no longer includes revenue generated from the former redevelopment tax rate areas.
Challenges to recognized enforceable obligations are assumed to have been resolved during fiscal year 2012-13. For the purposes of this report, residual revenue is
assumed to be distributed to the City in the same proportions as general fund revenue.
City of San Bernardino
Direct and Overlapping Property Tax Rates
Last Ten Fiscal Years
Fiscal Year
(1)In 1978, California voters passed Proposition 13 which set the property tax rate at a 1.00% fixed amount. This 1.00% is shared by all taxing agencies for which the
subject property resides within. In addition to the 1.00% fixed amount, property owners are charged taxes as a percentage of assessed property values for the payment
of any voter approved bonds.
204
Percent of Percent of
Total City Total City
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxpayer:Value Rank Value Value Rank Value
Stater Bros Markets 380,512,044$ 1 2.68% 318,939,386$ 1 2.86%
Golden State FC LLC 155,235,095 2 1.09% -
HW Southgate Building LLC 113,927,752 3 0.80% -
WM Inland Investors IV LLC 113,724,285 4 0.80% -
IE Logistics Inc 104,871,147 5 0.74% -
Kohl's Department Stores Inc 98,638,082 6 0.69% 73,224,897 6 0.66%
San Manuel Band of Mission Indians 79,384,224 7 0.56% -
Lit Industrial LP 74,459,470 8 0.52% 115,668,000 3 1.04%
Harvest A OSR LLC 73,586,577 9 0.52% -
Exeter 6227 Cajon LLC 69,361,244 10 0.49% -
Rancon Realty Fund 157,031,028 2 1.41%
SP4 Cajon II LP 98,928,752 4 0.89%
Opus Real Estate CA VII Northpointe 77,520,000 5 0.70%
SP4 Gateway South I LP 64,404,840 7 0.58%
SP4 Gateway North LP 62,009,921 8 0.56%
SP4 Interchange 60,530,131 9 0.54%
Westgate No 1 LP 60,123,047 10 0.54%
1,263,699,920$ 8.89% 1,088,380,002$ 9.78%
Sources: HdL, Coren & Cone
2019 2009
City of San Bernardino
Principal Property Taxpayers
Current Year and Ten Years Ago
205
Fiscal Taxes Levied Collections in
Year Ended for the Percent Subsequent Percent
June 30 Fiscal Year Amount of Levy Years Amount of Levy
2010 11,173,659 10,507,597 94.04% 943,324 11,450,921 102.48%
2011 10,567,101 10,184,419 96.38% 430,365 10,614,784 100.45%
2012 10,547,495 9,552,101 90.56% 291,277 9,843,378 93.32%
2013 9,693,543 9,218,290 95.10% 167,799 9,386,089 96.83%
2014 10,139,727 9,783,362 96.49% 265,648 10,049,010 99.11%
2015 10,933,170 10,059,145 92.01% 219,257 10,278,402 94.01%
2016 11,030,576 10,593,161 96.03% 208,567 10,801,728 97.93%
2017(1)N/A 95,314 N/A 116,204 211,518 N/A
2018(1)N/A 197,198 N/A 88 197,286 N/A
2019(1)N/A 235,242 N/A 5,550 240,792 N/A
Note:
The amounts presented include City property taxes only.
In 2011 penalties started to be excluded from amounts collected.
Source: County of San Bernardino, Auditor/Controller - Recorder - County Clerk
(1)Effective, July 1, 2016, fire protection and emergency medical response services were transferred to the San Bernardino County Fire Protection
District (SBCFPD). To fund this transfer, the City is required to transfer revenue from property taxes and 35 percent of its Vehicle Registration
Fees to SBCFPD.
City of San Bernardino
Property Tax Levies and Collections
Last Ten Fiscal Years
Fiscal Year of Levy
Collected within the
Total Collections to Date
206
Percent of Percent of Percent of
Total Total Sewer Total Sewer
Customer Water Customer Treatment Customer Collection
Customer:Revenue Rank Revenue Revenue Rank Revenue Revenue Rank Revenue
City of San Bernardino 1,061,423$ 1 2.78% 58,431$ 9 0.20% 64,715$ 3 0.85%
City of Colton 887,296 2 2.33%
San Bernardino City Unified School District 730,998 3 1.92% 166,606 1 0.56% 110,440 1 1.46%
California State University, San Bernardino 405,518 4 1.06%
Cott Beverages 286,725 5 0.75%
Housing Authority 219,020 6 0.57% 128,541 3 0.43% 32,342 10 0.43%
County of San Bernardino 169,765 7 0.45% 163,590 2 0.55% 74,275 2 0.98%
Hines 145,100 8 0.38%
Pama Management Co. 139,763 9 0.37% 116,463 4 0.39% 61,143 4 0.81%
W. Dean Weidner 136,740 10 0.36%
St. Bernardine Hospital 108,745 5 0.36% 58,056 5 0.77%
Lido Condominiums 72,464 6 0.24% 38,853 7 0.51%
Crest Haven Apts. 68,230 7 0.23% 34,102 8 0.45%
Broadstone Investors LLC 59,949 8 0.20% 32,578 9 0.43%
243 North Meridian LLC 57,245 10 0.19%
Rancho Meridian MHE/Santiago 41,231 6 0.54%
4,182,349$ 10.97% 1,000,265$ 3.35% 547,735$ 7.24%
Source: City Water Department
Water Sewer Treatment Sewer Collection
City of San Bernardino
Top 10 Customers - Water, Sewer Treatment, Sewer Collection
Current Year
207
User Type Connections Revenue Connections Revenue Connections Revenue Connections Revenue
Single family 36,006 21,579,693$ 35,824 20,476,866$ 35,825 17,346,414$ 35,729 15,688,749$
Multiple family 2,903 5,157,997 2,904 4,944,978 2,899 4,449,204 2,873 4,225,832
Commercial 3,104 6,320,900 3,111 6,117,493 3,131 5,750,672 3,092 4,913,942
Landscape 1,150 4,256,390 1,159 4,694,704 1,121 3,789,527 1,129 3,203,907
Other 2,056 808,227 2,018 748,141 1,956 557,392 1,905 677,180
Total all users 45,220 38,123,207$ 45,016 36,982,182$ 44,932 31,893,209$ 44,728 28,709,610$
Connections Revenue Connections Revenue Connections Revenue Connections Revenue
Single family 35,695 16,775,834$ 35,012 18,583,708$ 34,913 18,741,773$ 34,716 18,094,052$
Multiple family 2,869 4,349,601 2,824 4,591,290 2,820 4,704,384 2,801 4,510,962
Commercial 3,097 6,332,882 3,085 6,566,344 3,082 6,800,310 3,117 5,790,427
Landscape 1,130 3,079,610 1,140 3,616,135 1,104 3,591,678 1,151 3,321,846
Other 1,791 679,606 1,703 913,810 1,663 599,210 1,626 1,597,791
Total all users 44,582 31,217,533$ 43,764 34,271,287$ 43,582 34,437,355$ 43,411 33,315,078$
Connections Revenue Connections Revenue
Single family 34,695 15,665,580$ 34,542 13,899,599$
Multiple family 2,806 4,025,079 2,799 3,442,271
Commercial 3,117 4,678,003 3,127 3,826,613
Landscape 1,149 2,745,990 1,158 2,367,514
Other 1,571 701,296 1,553 900,840
Total all users 43,338 27,815,948$ 43,179 24,436,837$
Source: City Water Department
City of San Bernardino
Connections and Revenues by User Type - Water
Last Ten Fiscal Years
2011 2010
2019 2018 2017 2016
2015 2014 2013 2012
208
Effective
Date 1/2" 5/8" 3/4" 1" 1-1/2" 2" 3" 4" 6" 8" 10" 12"
7/1/2009 * $8.88 $11.84 $14.16 $25.41 $35.49 $60.35 $102.46 $184.47 $276.67 $345.84 $415.08
2/1/2010 10.55 10.55 13.00 17.90 30.15 44.85 79.15 128.15 250.70 397.75 569.30 *
1/1/2011 12.20 12.20 15.15 21.00 35.75 53.45 94.75 153.70 301.15 478.10 684.55 *
1/1/2012 12.90 12.90 16.15 22.60 38.80 58.20 103.50 168.20 330.00 524.15 750.65 *
7/1/2013 12.90 12.90 16.15 22.60 38.80 58.20 103.50 168.20 330.00 524.15 750.65 *
7/1/2014 12.90 12.90 16.15 22.60 38.80 58.20 103.50 168.20 330.00 524.15 750.65 *
7/1/2015 12.90 12.90 16.15 22.60 38.80 58.20 103.50 168.20 330.00 524.15 750.65 *
10/1/2016 16.09 16.09 20.15 28.19 48.40 72.60 129.12 197.36 411.68 653.88 936.44 *
7/1/2017 19.58 19.58 24.51 34.30 58.88 88.32 157.06 240.07 500.78 795.40 1,139.12 *
7/1/2018 23.39 23.39 29.28 40.98 70.35 105.52 187.66 286.63 598.33 950.34 1,361.01 *
7/1/2019 23.39 23.39 29.28 40.98 70.35 105.52 187.66 286.63 598.33 950.34 1,361.01 *
* Information not reported
Source: City Water Department
Monthly Charge(1)
(1)Effective July 1, 2007 and July 1, 2008, all water usage except municipal will be billed at the rate of $0.94 and $0.97 per 100 cubic feet,
respectively, with no minimum allowance.
City of San Bernardino
Water Rate History - Minimum Monthly Charge
Last Ten Fiscal Years
209
User Type Connections Revenue Connections Revenue Connections Revenue Connections Revenue
San Bernardino Residential 33,051 $10,146,660 32,945 $10,135,132 32,960 $9,756,592 32,889 $8,746,617
San Bernardino Nonresidential 5,531 8,645,032 5,526 8,834,641 5,471 8,010,240 5,377 7,125,053
East Valley Residential 18,477 4,778,152 18,477 4,765,218 18,477 4,622,944 18,477 4,008,039
East Valley Nonresidential 1,050 3,550,973 1,050 3,579,348 1,050 3,083,475 1,060 2,825,971
Loma Linda Residential 2,799 1,171,706 4,824 1,167,823 4,723 1,107,201 5,948 1,008,071
Loma Linda Nonresidential 345 1,557,119 703 1,548,574 593 1,441,807 591 1,308,474
Total all users 61,253 $29,849,643 63,525 $30,030,737 63,274 $28,022,259 64,342 $25,022,225
Connections Revenue Connections Revenue Connections Revenue Connections Revenue
San Bernardino Residential 32,874 $8,056,827 32,537 $8,111,634 32,563 $7,922,936 32,571 $7,650,142
San Bernardino Nonresidential 5,344 7,240,533 5,410 8,033,072 5,447 8,332,214 5,412 7,877,416
East Valley Residential 18,480 4,093,625 18,404 4,149,836 18,925 4,188,434 18,813 4,019,127
East Valley Nonresidential 1,051 2,571,813 1,115 2,725,075 1,126 2,434,118 1,128 2,492,375
Loma Linda Residential 5,040 997,242 4,656 991,387 4,663 1,063,124 4,443 933,648
Loma Linda Nonresidential 588 1,294,612 592 1,330,102 585 1,549,643 589 1,258,747
Total all users 63,377 $24,254,651 62,714 $25,341,106 63,309 $25,490,469 62,956 $24,231,455
Connections Revenue Connections Revenue
San Bernardino Residential 32,447 $7,053,263 32,307 $6,670,859
San Bernardino Nonresidential 5,416 7,131,988 5,196 6,699,228
East Valley Residential 18,700 3,645,721 18,157 3,348,238
East Valley Nonresidential 1,138 2,070,233 1,132 2,185,072
Loma Linda Residential 4,648 870,734 4,688 839,451
Loma Linda Nonresidential 584 1,048,402 588 1,016,088
Total all users 62,933 $21,820,341 62,068 $20,758,936
Source: City Water Department
City of San Bernardino
Connections and Revenues by User Type - Sewer Treatment
Last Ten Fiscal Years
2011 2010
2019 2018 2017 2016
2015 2014 2013 2012
210
1/1/2009 1/1/2010 2/1/2011 1/1/2012 10/1/2015 7/1/2016 7/1/2017 7/1/2018 7/1/2019
Residential (monthly per EDU)15.25 16.00 17.00 18.50 20.65 22.38 23.10 23.10 23.10
Commercial:
Commodity Charge (per HCF):
Multi-family, mobile home parks 0.90 0.95 1.10 1.25 1.36 1.48 1.53 1.53 1.53
Retail, commercial, light industrial 1.80 1.90 2.00 2.10 2.28 2.47 2.55 2.55 2.55
Auto repair, car wash 1.25 1.30 1.30 1.30 1.41 1.53 1.58 1.58 1.58
Offices, motels (w/o restaurants) 1.40 1.50 1.50 1.50 1.63 1.77 1.83 1.83 1.83
Restaurants, hotels 1.90 2.00 2.35 2.70 2.93 3.18 3.28 3.28 3.28
Laundromats 1.25 1.30 1.40 1.50 1.63 1.77 1.83 1.83 1.83
Hospitals, convalescent homes 0.90 0.95 1.15 1.35 1.46 1.58 1.63 1.63 1.63
Schools, churches, nursery schools 0.65 0.70 0.90 1.10 1.19 1.29 1.33 1.33 1.33
Industrial:
Discharge Flow (per million gallons) 860.00 900.00 900.00 900.00 977.00 1,060.00 1,094.00 1,094.00 1,094.00
Biological Oxygen demand (per 1,000 lbs) 280.00 292.00 330.00 360.00 391.00 424.00 438.00 438.00 438.00
Suspended Solids (per 1,000 lbs) 610.00 640.00 640.00 640.00 694.00 753.00 778.00 778.00 778.00
Source: City Water Department
Fiscal Year
City of San Bernardino
Sewer Treatment Rate History
Last Ten Fiscal Years
211
User Type Connections Revenue Connections Revenue Connections Revenue
Residential-Single Family 33,127 $3,927,784 32,939 $3,916,946 32,899 $3,719,798
Residential-Multi Family 1,606 424,665 1,607 424,024 1,609 405,007
Residential- Multi Family 4 Units + 17 44,420 16 44,945 15 41,351
Comm/Land/Lt. Industrial/Non-Res. 3,180 2,601,804 3,198 2,668,497 3,204 2,467,470
Education-Public 27 21,700 27 26,118 27 27,420
Education-Private 152 61,858 150 67,985 150 61,779
Hospital/Convalescent Homes 35 166,768 35 170,063 35 161,182
Office/Motel-No Restaurant 94 69,280 94 66,015 96 58,587
Restaurant/ Hotel w/ Restaurant 47 37,750 41 35,963 37 32,509
Auto Repair/Car Wash 229 74,854 231 89,565 229 75,421
Laundromat 5 23,362 5 23,160 5 21,824
CS Irrigation 43 115,905 45 145,737 46 158,834
Totals IVDA 50 - 49 - 51 -
Total all users 38,613 $7,570,150 38,438 $7,679,020 38,402 $7,231,183
Source: City Water Department
* As the Sewer Collection Utility was transferred to the Water Department on May 1, 2017, prior year data is unavailable. Data provided for 2017
represents the entire year.
2019 2018 2017
City of San Bernardino
Connections and Revenues by User Type - Sewer Collection
Last Three Fiscal Years*
212
1/1/2009 1/1/2010 10/1/2015 7/1/2016 7/1/2017 7/1/2018 7/1/2019
Residential (monthly per EDU)3.75 4.00 9.00 9.45 9.90 9.90 9.90
Multi-Family
Multi-family, 2 units n/a 8.00 18.00 18.90 19.85 19.85 19.85
Multi-family, 3 units n/a 12.00 27.00 28.35 29.75 29.75 29.75
Multi-family, 4 or more units, Non-res.
Monthly Charge n/a 1.25 2.80 2.95 3.10 3.10 3.10
Usage Charge (per HCF) n/a 0.35 0.79 0.83 0.87 0.87 0.87
Source: City Water Department
City of San Bernardino
Sewer Collection Rate History
Last Ten Fiscal Years
Fiscal Year
213
2010 2011 2012 2013 2014
Governmental Activities:
Lease revenue bonds 12,410,000$ 11,145,000$ 9,810,000$ 7,505,000$ 6,925,000$
Tax allocation bonds(1)131,777,008 134,670,538 - - -
Certificates of participation(2)11,450,000 10,940,000 4,520,000 4,270,000 4,010,000
Pension obligation bonds (2)47,902,051 47,075,251 46,140,860 51,862,482 52,202,499
Other 31,850,996 46,518,126 23,838,553 22,983,032 21,351,657
Total governmental activities 235,390,055 250,348,915 84,309,413 86,620,514 84,489,156
Business-type Activities:
Capital leases 13,598,053 13,149,895 10,280,057 7,343,367 4,792,949
Notes payable 27,912,613 24,439,995 31,547,225 29,451,835 26,174,480
Certificates of participation 19,539,695 17,196,320 14,707,332 12,077,692 9,292,368
Water bonds 35,000 25,000 15,000 - -
Total business-type activities 61,085,361 54,811,210 56,549,614 48,872,894 40,259,797
Total Primary Government 296,475,416$ 305,160,125$ 123,549,027$ 135,493,408$ 124,748,953$
Percentage of Personal Income(3)4.74% 4.65% 1.81% 1.94% 1.76%
Debt per Capita(3)1,412$ 1,452$ 586$ 639$ 587$
(3) Based on most current data available.
(1) As a result of the dissolution of the Economic Development Agency on January 31, 2012, indebtedness was transferred to the Successor Agency.
(2) Upon approval of the City's Plan of Adjustment by the U.S. Bankruptcy Court on June 15, 2017, certain long-term liabilities of the City were
reduced or eliminated.
Fiscal Year
City of San Bernardino
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
214
2015 2016 2017 2018 2019
Governmental Activities:
Lease revenue bonds 6,315,000$ 5,670,000$ 4,985,000$ 4,414,002$ 3,598,360$
Tax allocation bonds(1)- - - - -
Certificates of participation(2)3,735,000 3,445,000 - - -
Pension obligation bonds (2)52,924,744 53,608,476 - - -
Other 18,235,640 12,219,665 30,383,546 28,820,616 27,055,863
Total governmental activities 81,210,384 74,943,141 35,368,546 33,234,618 30,654,223
Business-type Activities:
Capital leases 2,652,586 - - - -
Notes payable 22,826,237 20,568,662 900,000 600,000 300,000
Certificates of participation 6,346,308 - - - -
Water bonds - - 88,655,746 87,091,704 85,482,663
Total business-type activities 31,825,131 20,568,662 89,555,746 87,691,704 85,782,663
Total Primary Government 113,035,515$ 95,511,803$ 124,924,292$ 120,926,322$ 116,436,886$
Percentage of Personal Income(3)1.48% 1.20% 1.48% 1.42% 1.37%
Debt per Capita(3)528$ 443$ 576$ 547$ 531$
(3) Based on most current data available.
(1) As a result of the dissolution of the Economic Development Agency on January 31, 2012, indebtedness was transferred to the Successor Agency.
(2) Upon approval of the City's Plan of Adjustment by the U.S. Bankruptcy Court on June 15, 2017, certain long-term liabilities of the City were
reduced or eliminated.
Fiscal Year
City of San Bernardino
Ratios of Outstanding Debt by Type (Continued)
Last Ten Fiscal Years
215
Fiscal Tax Pension Lease Percent of
Year Ended Allocation Obligation Revenue Assessed Per
June 30 Bonds(1)Bonds(2)Bonds Total Value Capita
2010 131,777$ 47,902$ 12,410$ 192,089$ 1.75% 915$
2011 134,671 47,075 11,145 192,891 1.86% 918
2012 - 46,141 9,810 55,951 0.55% 265
2013 - 51,862 7,505 59,367 0.58% 280
2014 - 52,202 6,925 59,127 0.56% 278
2015 - 52,925 6,315 59,240 0.53% 277
2016 - 53,608 5,670 59,278 0.50% 275
2017 - - 4,985 4,985 0.04% 23
2018 - - 4,414 4,414 0.03% 20
2019 - - 3,598 3,598 0.03% 16
Source: City Finance Department
(1) As a result of the dissolution of the Economic Development Agency on January 31, 2012, indebtedness was transferred to the
Successor Agency.
(2) Upon approval of the City's Plan of Adjustment by the U.S. Bankruptcy Court on June 15, 2017, certain long-term liabilities of the
City were reduced or eliminated.
Outstanding General Bonded Debt
City of San Bernardino
Ratio of General Bonded Debt Outstanding
Last Ten Fiscal Years
(In Thousands, except per capita)
216
2018-19 Assessed Valuation : 14,190,216,655$
OVERLAPPING TAX AND ASSESSMENT DEBT:
Total Debt
6/30/2019 % Applicable(1)
City's Share of Debt
6/30/19
San Bernardino Community College District 430,013,947$ 20.106% 86,458,604$
Colton Joint Unified School District 187,883,831$ 8.482% 15,936,307$
Redlands Unified School District 71,523,512$ 4.403% 3,149,180$
Rialto Unified School District 83,953,902$ 7.284% 6,115,202$
San Bernardino City Unified School District 241,159,446$ 76.778% 185,157,399$
Colton Joint Unified School District Community Facilities District No. 2 3,810,000$ 41.053% 1,564,119$
TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT 298,380,811$
DIRECT AND OVERLAPPING GENERAL FUND DEBT:
San Bernardino County General Fund Obligations 335,155,000$ 6.379% 21,379,537$
San Bernardino County Pension Obligation Bonds 288,826,268$ 6.379% 18,424,228$
San Bernardino County Flood Control District General Fund Obligations 62,820,000$ 6.379% 4,007,288$
Colton Joint Unified School District Certificates of Participation 1,188,372$ 8.482% 100,798$
Redlands Unified School District Certificates of Participation 5,000,000$ 4.403% 220,150$
Rialto Unified School District Certificates of Participation 12,574,391$ 7.284% 915,919$
San Bernardino City Unified School District Certificates of Participation 104,995,000$ 76.778% 80,613,061$
City of San Bernardino General Fund Obligations 3,598,360$ 100.000% 3,598,360$
City of San Bernardino Pension Obligation Settlement Agreement Notes Payable 20,620,746$ 100.000% 20,620,746$
TOTAL DIRECT AND OVERLAPPING GENERAL FUND DEBT 149,880,087$
OVERLAPPING TAX INCREMENT DEBT (Successor Agencies):
San Bernardino County Inland Valley Project Tax Allocation Bonds 235,260,000$ 62.774% 147,682,112$
City of San Bernardino Tax Allocation Bonds 70,520,000$ 100.000% 70,520,000$
City of San Bernardino Certificates of Participation 3,215,000$ 100.000% 3,215,000$
TOTAL OVERLAPPING TAX INCREMENT DEBT 221,417,112$
TOTAL DIRECT DEBT 24,219,106$
TOTAL OVERLAPPING DEBT 645,458,904$
COMBINED TOTAL DEBT 669,678,010$ (2)
Ratios to 2018-19 Assessed Valuation :
Total Overlapping Tax and Assessment Debt 2.10%
Total Direct Debt ($24,219,106) 0.17%
Combined Total Debt 4.72%
Ratios to Redevelopment Successor Agency Incremental Valuation 7,233,156,348$
Total Overlapping Tax Increment Debt 3.06%
AB:($500)
Source: California Municipal Statistics, Inc.
Current Fiscal Year
Schedule of Direct and Overlapping Bonded Debt
City of San Bernardino
(1)The percentage of overlapping debt applicable to the city is estimated using taxable assessed property value. Applicable percentages were
estimated by determining the portion of the overlapping district's assessed value that is within the boundaries of the city divided by the district's
total taxable assessed value.
(2)Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations. Qualified Zone
Academy Bonds are included based on principal due at maturity.
217
2010 2011 2012 2013 2014
Assessed valuation 11,145,051$ 10,489,740$ 10,306,184$ 10,314,097$ 10,695,189$
Conversion percentage 25% 25% 25% 25% 25%
Adjusted assessed value 2,786,263 2,622,435 2,576,546 2,578,524 2,673,797
Debt limit percentage 15% 15% 15% 15% 15%
Debt limit 417,939 393,365 386,482 386,779 401,070
Total net debt applicable to limit:
General obligation bonds 71,762 69,160 66,436 69,192 68,352
Legal debt margin 346,177$ 324,205$ 320,046$ 317,586$ 332,717$
Total debt applicable to the limit
as a percentage of debt limit 17.2% 17.6% 17.2% 17.9% 17.0%
Fiscal Year
City of San Bernardino
Legal Debt Margin
Last Ten Fiscal Years
(amounts in thousands)
Note:
The government code of the State of California provides for a legal debt limit of 15% of gross assessed valuation. However, this provision was
enacted when assessed valuation was based upon 25% of market value. Effective with the 1981-82 fiscal year, each parcel in now assessed at
100% of market value (as of the most recent change in ownership for that parcel). The computations shown above reflect a conversion of
assessed valuation data for each fiscal year from the current full valuation perspective to the 25% level that was in effect at the time that the
legal debt margin was enacted by the State of California for local governments located within the state.
218
2015 2016 2017 2018 2019
Assessed valuation 11,298,116$ 11,913,720$ 12,658,595$ 13,387,519$ 14,190,217$
Conversion percentage 25% 25% 25% 25% 25%
Adjusted assessed value 2,824,529 2,978,430 3,164,649 3,346,880 3,547,554
Debt limit percentage 15% 15% 15% 15% 15%
Debt limit 423,679 446,764 474,697 502,032 532,133
Total net debt applicable to limit:
General obligation bonds 67,830 67,198 9,060 8,069 6,813
Legal debt margin 355,850$ 379,566$ 465,637$ 493,963$ 525,320$
Total debt applicable to the limit
as a percentage of debt limit 16.0% 15.0% 1.9% 1.6% 1.3%
Fiscal Year
City of San Bernardino
Legal Debt Margin (Continued)
Last Ten Fiscal Years
(amounts in thousands)
Note:
The government code of the State of California provides for a legal debt limit of 15% of gross assessed valuation. However, this provision was
enacted when assessed valuation was based upon 25% of market value. Effective with the 1981-82 fiscal year, each parcel in now assessed at
100% of market value (as of the most recent change in ownership for that parcel). The computations shown above reflect a conversion of
assessed valuation data for each fiscal year from the current full valuation perspective to the 25% level that was in effect at the time that the
legal debt margin was enacted by the State of California for local governments located within the state.
219
Water Utility
Fiscal Operating Net Non- Net
Year Ended Operating Expenses Operating Operating Available
June 30 Revenue (Excl. Depr.) Income Income (Expense) Revenue Principal Interest Coverage
2010 27,689 26,543 1,146 2,102 3,248 956 667 2.00
2011 33,028 29,786 3,242 2,025 5,267 1,352 548 2.77
2012 37,106 33,385 3,721 2,436 6,157 974 506 4.16
2013 37,869 31,925 5,944 2,492 8,436 1,227 548 4.75
2014 36,672 30,070 6,602 2,505 9,107 1,658 661 3.93
2015 33,121 30,139 2,982 2,703 5,685 1,748 570 2.45
2016 30,002 29,025 977 2,283 3,260 1,814 523 1.39
2017 33,359 30,597 2,762 2,584 5,346 247 219 11.47
2018 38,280 27,874 10,406 3,168 13,574 770 2,224 4.53
2019 39,100 27,482 11,618 3,810 15,428 795 2,196 5.16
Sewer Utility
Fiscal Operating Net Non- Net
Year Ended Operating Expenses Operating Operating Available
June 30 Revenue (Excl. Depr.) Income Income (Expense) Revenue Principal Interest Coverage
2010 23,434 17,726 5,708 (20) 5,688 4,181 1,636 0.98
2011 25,889 17,409 8,480 (617) 7,863 2,130 3,706 1.35
2012 26,415 17,888 8,527 (462) 8,065 4,418 1,166 1.44
2013 25,671 18,548 7,123 (631) 6,492 4,724 757 1.18
2014 24,734 16,750 7,984 (1,129) 6,855 4,424 747 1.33
2015 25,411 16,750 8,661 1,099 9,760 4,629 569 1.88
2016 25,411 17,439 7,972 (224) 7,748 300 - 25.83
2017 28,612 20,037 8,575 39 8,614 300 133 19.89
2018 30,733 18,540 12,193 (721) 11,472 890 1,383 5.05
2019 30,546 20,554 9,992 1,362 11,354 910 1,356 5.01
Tax Allocation Bonds
Fiscal
Year Ended Tax
June 30(1)Increment(2)Principal Interest Coverage
2010 28 10 3 2.15
2011 54 10 2 4.50
2012 41 15 1 2.56
2013 N/A N/A N/A N/A
2014 N/A N/A N/A N/A
2015 N/A N/A N/A N/A
2016 N/A N/A N/A N/A
2017 N/A N/A N/A N/A
2018 N/A N/A N/A N/A
2019 N/A N/A N/A N/A
(1) As a result of the dissolution of the Economic Development Agency on January 31, 2012, indebtedness was transferred to the
Successor Agency.
(2) Tax Increment figures are net of related pass-through payments
Source: City department's annual reports
Debt Service
Debt Service
Debt Service
City of San Bernardino
Debt Service Coverage
Last Ten Fiscal Years
(In Thousands)
220
Personal Per Capita
Fiscal Income Personal Unemployment
Year Population(1)(in thousands) (2)Income(2)Rate(3)
2010 209,924 6,256,785$ 29,805$ 13.70%
2011 210,108 6,559,152 31,218 13.00%
2012 210,753 6,807,533 32,301 11.50%
2013 211,994 7,001,102 33,025 9.80%
2014 212,584 7,070,119 33,258 10.10%
2015 213,933 7,645,879 35,740 6.80%
2016 215,491 7,931,577 36,807 6.30%
2017 216,972 8,459,304 38,988 5.50%
2018 221,130 8,523,677 38,546 5.70%
2019 219,233 8,509,748 38,816 4.10%
(1) California Department of Finance
(2) U.S. Department of Commerce, Bureau of Economic Analysis for 2006-2013 (Riverside-San Bernardino MSA)
(3) State of California, Economic Development Department; City of San Bernardino Economic Development Dept
City of San Bernardino
Demographic and Economic Statistics
Last Ten Calendar Years
221
Employer Ranking Number of Employees Ranking Number of Employees
County of San Bernardino 1 22,719 9 1,000+
Stater Brothers 2 18,000
San Bernardino City Unified School District 3 6,400 5 1,000+
BNSF Railway Co.* 4 1,000-4,999
California State University, San Bernardino* 5 1,000-4,999 1 1,000+
Saint Bernardine Medical Center* 6 1,000-4,999 10 1,000+
Community Hospital of San Bernardino* 7 1,000-4,999 4 1,000+
State of California, Department of Transportation* 8 1,000-4,999 2 1,000+
San Bernardino County Sheriff* 9 1,000-4,999 6 1,000+
City of San Bernardino 10 1,185 3 1,000+
San Bernardino County Superintendent of Schools 7 1,000+
San Manuel Band of Mission Indians 8 1,000+
Source: Economic Development Department Labor Market Information, Agency Websites and City's Annual Financial Report
* Actual employment numbers not available
Fiscal Year 2019 Fiscal Year 2010*
City of San Bernardino
Principal Employers
Current Year and Nine Years Ago
222
Fiscal Year
Function 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
General Government 175 183.5 176.5 110 131 146 148 147 117 107
Public Safety 757 795 725 611 615 611 607 470 474 468
Streets 234 270 257 95 221 270 254 185 138 131
Culture & Recreation 142 150 144 105 106 101 103 104 111 110
Community Development 77 72 70 27 26 35 37 39 38 33
Community Service 52 45 41 38 42 32 33 34 38 37
Enterprise 251 242 256 256 258 258 272 300 299 299
Total 1,688 1,758 1,670 1,242 1,399 1,453 1,454 1,279 1,215 1,185
Source: Budgeted positions for full and part time employees
City of San Bernardino
Budgeted Full-Time and Part-Time Positions by Function
Last Ten Fiscal Years
223
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Pubic Safety:
Police stations 1 1 1 1 1 1 1 1 1 1
Fire stations 12 12 12 12 12 12 12 * * *
Public Works:
Miles of streets 629 629 629 ** ** ** ** ** ** 629
Street lights (City maintained) 5,100 5,100 5,900 ** ** ** ** ** ** **
Street lights (SCE maintained) 7,700 7,700 7,500 ** ** ** ** ** ** **
Street traffic controllers (signals) 272 272 272 ** ** ** ** ** ** 289
Street traffic controllers (ped-xing) 19 19 19 ** ** ** ** ** ** 19
Parks and Recreation:
Parks 39 39 37 37 37 37 37 37 37 36
Park acreage 618 618 545 545 545 545 545 545 545 530
Water:
Water mains (miles) 584 586 587 597 602 603 608 608 609 612
Sewer:
Sanitary sewers (miles) 510 510 510 510 510 510 510 510 510 510
Source: Various City departments
* Effective, July 1, 2016, fire protection and emergency medical response services were transferred to the San Bernardino County Fire District.
** Information not available
Fiscal Year
City of San Bernardino
Capital Asset Statistics
Last Ten Fiscal Years
224
Fiscal Year
2010 2011 2012 2013 2014
Police:
Arrests 13,733 13,620 8,346 8,100 11,386
Parking citations issued 24,266 27,606 16,608 18,559 19,531
Traffic citations issued 21,141 18,773 9,467 11,177 6,842
Fire:
Number of emergency calls 29,578 25,720 25,734 * *
Inspections 5,344 6,144 3,476 * *
Public Works/Public Services:
Street resurfacing (lane miles) 31 23 7 * *
Parks and Recreation:
Number of recreation classes 346 501 357 504 450
Number of facility rentals 372 268 247 260 235
Water:
Total connections 43,179 43,338 43,411 43,582 43,764
Sewer:
Total connections 62,068 62,933 62,956 63,309 62,714
Source: Various City departments
* Information not available
** Effective, July 1, 2016, fire protection and emergency medical response services were transferred to the San Bernardino County Fire District.
City of San Bernardino
Operating Indicators by Function
Last Ten Fiscal Years
225
Fiscal Year
2015 2016 2017 2018 2019
Police:
Arrests 10,590 8,930 10,256 11,295 12,100
Parking citations issued 14,692 14,781 21,711 21,480 16,359
Traffic citations issued 4,338 3,062 3,848 3,108 9,055
Fire:
Number of emergency calls * * ** ** **
Inspections * * ** ** **
Public Works/Public Services:
Street resurfacing (lane miles)*****
Parks and Recreation:
Number of recreation classes 432 525 494 514 509
Number of facility rentals 220 290 277 345 321
Water:
Total connections 44,582 44,728 44,932 45,016 45,219
Sewer:
Total connections 63,377 64,342 63,274 63,525 63,525
Source: Various City departments
* Information not available
** Effective, July 1, 2016, fire protection and emergency medical response services were transferred to the San Bernardino County Fire District.
City of San Bernardino
Operating Indicators by Function (Continued)
Last Ten Fiscal Years
226
FY 2018/19 Comprehensive Annual Financial Report
February 19, 2020
Presented by Sam Singery, Accounting Division Manager
1
Introduction
Background
•Annual audit requirement of all accounts
•Due to State Controller’s Office by March 31 of the year following the
close of the fiscal year
•City has filed timely each year since FY2015/16
•FY2018/19 marks the earliest filing since FY2010/11
2
FY 2018/19
FY 2018/19
•First Comprehensive Annual Financial Report (CAFR) assembled since FY 2011/12
•CAFR provides wider variety of important information intended to help the reader properly understand the financial statements
•City has continually improved reporting and caught up on backlog of annual audits
•Unmodified opinion rendered by Independent Auditors (The Pun Group, LLP)
•Over the last 4 years, City has worked to steadily eliminate audit findings. In FY19 the last of the findings were addressed
•City has received modified opinions since FY 2011/12
3
AFR vs. CAFR
Annual Financial
Report (AFR)
Comprehensive Annual
Financial Report (CAFR)
Transmittal letter from City executives
•Government Profile
•Economic Update
•Major Initiatives
Management Discussion and Analysis (MD&A)
•Overview of financial statements
•Current year highlights
Independent Auditors’ Report
Government-Wide Financial Statements
Fund Financial Statements
Notes to the Financial Statements
Required Supplementary Information & Supplementary
Information
Statistical Section
4
Independent Auditors’ Report
FY 2018/19 Audit Opinion: Unmodified
•Indicates auditor was able to perform all test work and verify the
financial statement balances accurately reflect the City’s financial
position
•Previous modification related to Notes Receivable and Allowance
balances in various Special Revenue Funds was remediated during
the year
5
Financial Statement Review
6
Financial Statement Overview
Three Components
•Government-Wide Financial Statements
•Fund Financial Statements
•Notes to the Financial Statements
7
Government-Wide Financial Statements
Long-Term Comprehensive View
•All Assets, including Capital Assets (i.e. Land, Infrastructure,
Equipment, etc.)
•All Liabilities, including long-term liabilities (CalPERS Pension, Bonds
Payable, Claims Payable, etc.)
•Funds grouped into two categories:
•Governmental Activities
•Business-Type Activities
8
Government-Wide Financial Statements
FY 2018/19 Results
Governmental
Activities
Business-Type
Activities
Total Primary
Government
YE 2018 99,725,838$ 283,502,895$ 383,228,733$
YE 2019 78,051,465 296,237,839 374,289,304
Change (21,674,373)$ 12,734,944$ (8,939,429)$
% change -21.7% 4.5% -2.3%
Changes in Net Position
9
Government-Wide Financial Statements
FY2018/19 Results – Net Pension Liability
•Decrease primarily due to net investment income over the year
•Total CalPERS required contributions for the City were $28.18 million for the Safety and Miscellaneous plans and $5.25 million for the Water portion of the Miscellaneous plan
Miscellaneous
Plan Safety Plan Combined Total
YE 2018 162,764,096$ 260,306,211$ 423,070,307$
YE 2019 157,934,294 257,405,872 415,340,166
Change (4,829,802)$ (2,900,339)$ (7,730,141)$
% change -3.0% -1.1% -1.8%
Change in Net Pension Liability
10
Fund Financial Statements
Fund Accounting
Used to maintain control over resources that have been segregated for specific activities or
objectives
•Three categories of Fund Financial Statements
•Governmental Funds
•General Fund
•Federal and State Grants Fund
•Other Governmental Funds
•Proprietary Funds
•Business-type Activities (Water, Sewer, Sewer Collection, and Integrated Waste)
•Fiduciary Funds
•Successor Agency and Other Agency Funds
11
Fund Financial Statements
FY 2018/19 Results – Governmental Funds
General Fund
Federal and
State Grants
Fund
Other
Governmental
Funds
Total
Governmental
Funds
YE 2018 72,090,552$ 17,880,652$ 71,842,753$ 161,813,957$
YE 2019 64,540,412 18,085,335 79,934,739 162,560,486
Change (7,550,140)$ 204,683$ 8,091,986$ 746,529$
% change -10.5% 1.1% 11.3% 0.5%
Changes in Fund Balance
12
Fund Financial Statements
FY 2018/19 Results – General Fund
Fund Balance by Category
Category Amount
Non-Spendable 32,855,157$
Restricted 73,416
Committed 68,387
Unassigned 31,543,452
Total General Fund 64,540,412$
13
Fund Financial Statements
FY 2018/19 Results – General Fund
Fund Balance by Category
14
Category Target Reserve Actual at 6/30/19
Emergency Reserve - 15% of adopted budget 19,024,050$ 19,024,050$
Economic Reserve - 10% of adopted budget 12,682,700 10,151,928
Carryovers 2,367,474
Unassigned - -
Total General Fund 31,706,750$ 31,543,452$
Recommendation
Action Recommended
•Mayor and City Council receive and file the audited Comprehensive
Annual Financial Report for FY 2018/19
15
Questions/Discussion
16