HomeMy WebLinkAbout05.b. Review draft position paper to accept (1) the Audited Comparative Annual Comprehensive Financial Report (ACFR) for Fiscal Year 2020-2021 and (2) the independent auditors' memorandum of internal control and required communications for the fiscal yeaPage 1 of 104
Item 5.b.
MEETING DATE:
DECEMBER 21, 2021
BOARD OF DIRECTORS
POSITION PAPER
SUBJECT: REVIEW DRAFT POSITION PAPER TO ACCEPT (1) THE AUDITED
COMPARATIVE ANNUAL COMPREHENSIVE FINANCIAL REPORT (ACFR)
FOR THE FISCAL YEARS ENDED JUNE 30, 2021, AND 2020 PERFORMED
BYMAZE &ASSOCIATES,AND (2)THE INDEPENDENT AUDITORS'
MEMORANDUM ON INTERNAL CONTROL AND REQUIRED
COMMUNICATIONS FOR THE FISCAL YEAR ENDED JUNE 30, 2021
SUBMITTED BY:
INITIATING DEPARTMENT:
KEVIN MIZUNO, FINANCE MANAGER ADMINISTRATION -FINANCE
REVIEWED BY: PHILIPLEIBER, DIRECTOR OF FINANCE AND ADMINISTRATION
ROGER S. BAILEY, GENERAL MANAGER
ISSUE
The comparative audited ACFR of Central San for the fiscal years ended June 30, 2021, and 2020, and
the independent auditors' memorandum on internal control and required communications for the year
ended June 30, 2021, are being submitted to the Board.
BACKGROUND
Independent Audit Results
The independent audit firm of Maze & Associates has completed their eighth consecutive audit of Central
San's annual financial statements for the fiscal years ended June 30, 2021, and 2020, and has issued their
audit opinion thereon. The objective of this annually required independent audit is the expression of an
opinion as to whether the basic financial statements are fairly presented, in all material respects, in
conformity with United States generally accepted accounting principles (GAAP) and to report on the
fairness of the supplementary information in relation to the financial statements taken as a whole. The audit
is conducted in accordance with auditing standards generally accepted in the United States (GAAS).
GAAS require the independent auditor to plan and perform the audit to obtain reasonable, but not
absolute, assurance about whether the financial statements are free from material misstatement.
Procedures performed necessary to gather sufficient audit evidence supporting their opinion are based on
a comprehensive assessment of Central San's financial risks, and incorporate an element of both internal
control risks and inherent business risks. Management is pleased to announce Central San's independent
auditor's report for the fiscal years ending June 30, 2021, and 2020 expresses an unmodified (clean)
opinion. As always, the I ndependent Auditors' Report including the audit opinion is included on Page 1 of
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 99 of 220
Page 2 of 104
the attached ACFR (Attachment 1). The ACFR is the new name for the report previously known as the
Comprehensive Annual Financial Report.
In accordance with California Govemment Code Section 53891, information from the audit is also used
to prepare an annual report filed with the State Controller's Office (SCO). This report is referred to as the
Financial Transactions Report (FTR), and is prepared following strict reporting guidelines published by
the SCO annually. Now that the annual independent audit has been completed, the FTR for the fiscal year
ended June 30, 2021, will be remitted electronically by the January 31, 2022, reporting deadline. The
audited financial statements will also be sent to the Contra Costa County County Auditor -Controller's
Office, the Contra Costa County Board of Supervisors, the Bond Rating Agencies, and posted to the
Electronic Municipal Market Access (EMMA) website as required by continuing disclosure requirements
for Central San's bond and certificate debt issuances.
I n accordance with GAAS, in the performance of their audit of the annual financial statements, the
independent auditors evaluated Central San's internal controls over financial reporting. Based on their
observations during the course of the audit, the independent auditors advise management of any
significant deficiencies or material misstatements and any recommendations to improve the system of
internal accounting controls. The independent auditors are required to communicate certain matters to
those charged with governance at the conclusion of the audit, which is addressed by their "Memorandum
on Internal Control and Required Communications" (Attachment 2). In addition to the clean audit opinion,
Management is also pleased to report there were no significant deficiencies or material misstatements
identified by the auditors as part of this year's audit.
Financial Summary
Pursuant to GAAP, as a stand-alone business -type governmental entity, Central San uses an enterprise
fund format to report its activities for financial statement purposes. Under this enterprise fund format, all
non -fiduciary sub -funds of the Central San (i.e. Running Expense, Sewer Construction, Self -I nsurance,
Debt Service) are consolidated into a single reporting unit and reported in a Statement of Net Position;
Statement of Revenues, Expenses and Changes in Net Position; and a Statement of Cash Flows. This
consolidated reporting unit is considered an "opinion unit" and is what Central San's independent auditors
have rendered their (clean) opinion on. Accordingly, the emphasis of the annual audited financial
statements is at the District -wide level pursuant to GAAP, and not at the sub -fund level.
Central San's total ending net position increased by $57.7 million or 7.5% in 2020-21. This increase is
primarily due to the additional pension -related deferred outflows and negative pension expense adjustment
recognized as a result of a $70.8 contribution made to the Contra Costa County Employee Retirement
Association, the Central San's pension plan administrator. This significant contribution was made in June
2021 to payoff the pension plan's Unfunded Actuarily Accrued Liability (UAAL) in conjunction with the
issuance of the 2021 Wastewater Revenue Certificates of Participation (COPs). COPs with par value of
$50.57 million were issued to generate, with premium, $58.0 million of proceeds to finance a portion of the
capital improvement budget in the current and following fiscal years, allowing for the redirection sewer
service charges from Central San's capital budget to its operating and maintenance budget, and use in the
pension pay -down.
Previously, the Finance Committee has inquired about Central San's accrued employee compensated
absences liability, specifically asking for additional information of the portion of the liability attributable to
employee sick leave accruals earned and compensable upon termination. The total balance of
compensated absences payable reflected on the ACFR as of the fiscal year ended June 30, 2021, is
$5.09 million, of which $1.40 million (27.6%) pertains to employee sick leave accruals. This $1.40 million
accrual attributable to sick leave reflects employee sick time vested and payable upon termination as of
June 30, 2021. Sick time may be used by employees while employed for eligible leave or be applied
towards pension service time and/or cashed out upon retirement as permitted in labor agreements
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 100 of 220
Page 3 of 104
currently in place. As disclosed in the ACFR's compensated absences footnote, employees hired prior to
May 1, 1985, have a vested interest 85% of accrued sick time, and the last employee hired prior to this
date retired in the fiscal year ended June 30, 2021. Employees hired on or after May 1, 1985 have a
vested interest in up to 40% of their sick time, based upon length of employment with Central San.
The payout of long-term compensated absences is a cash -only transaction with the expense being
accrued and recognized in Central San's financials as earned pursuant to GAAP. Absent significant
turnover or significant changes to payout caps, this obligation generally grows with payroll (i.e. employee
step increases, promotions, inflationary cost of living adjustments, etc.). Attachment 3 provides a historical
trend of the sick leave compensated absences liability for the current year's ACFR being presented today
for the year ended June 30, 2021, as well as the six fiscal years prior to this. The chart illustrates that while
the compensated absences liability has gradually grown as expected, the portion attributable to sick leave
accruals has decreased.
GFOA Award Program
The Government Finance Officers Association (GFOA) is a professional association of state/provincial
and local finance officers in the United States and Canada, and has served the public finance profession
since 1906. The GFOA established the Certificate of Achievement for Excellence in Financial Reporting
Program in 1945 to encourage and assist state and local governments to go beyond the minimum
requirements of generally accepted accounting principles (GAAP) issued by the Government Accounting
Standards Board (GASB) and to prepare CAFR that provide transparency and full disclosure, and then
recognize individual governments that succeed in achieving that goal.
On August 25, 2021, Central San was awarded a Certificate of Achievement for Excellence in Financial
Reporting by the GFOA for the report submitted for the fiscal year ended June 30, 2020, representing the
21 st consecutive year Central San has received the award. The Certificate of Achievement is the highest
form of recognition for excellence in state and local government financial reporting. In order to be awarded
a Certificate of Achievement, a government agency must publish an easily readable report in a prescribed
format report that complies with GAAP as well as GFOA program requirements. The ACFR includes ten
years of Central San's historical, financial, and statistical data. The ACFR provides a concise document
for internal management use, as well as external use with other agencies, and is posted on Central San's
website for the general public. A Certificate of Achievement is valid for a period of one year.
The Finance Division has prepared the Central San's ACFR as of June 30, 2021. Management is
confident that the current ACFR continues to meet the Certificate of Achievement for Excellence in
Financial Reporting Program requirements and intends to submit it to the GFOA to determine its eligibility
for another certificate.
Commentary on Draft Status ofACFR
The ACFR included with the Finance Committee agenda packet is in DRAFT form, allowing for the
Finance Committee, serving as an "audit committee" in this capacity, to provide feedback on any critical
items. Central San's independent auditors anticipate issuing the final audit opinion with signature
immediately after the December 21, 2021 Finance Committee meeting, which will be provided to the
Board for acceptance. Additionally, a few pages in the draft ACFR included with the agenda packet were
incomplete at the time the agenda packet was finalized with the attached ACFR temporarily displaying prior
year information for these pages. It is emphasized that these three incomplete pages are located in the
introductory and statistical sections of the ACFR, which are un-audited sections as outlined in the ACFR's
audit opinion letter (pg. 1 of the report). The replacement sheets for these three specific pages will be
provided as handouts for the December 21, 2021 Finance Committee meeting:
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 101 of 220
Page 4 of 104
1. Condensed Organizational Chart (pg. xi)
3. Statistics page on Central San's "Ten Largest Customers" (pg. S-6)
4. Statistics table on "Sewer Service Charges by Type" (pg. S-7, bottom table)
ALTERNATIVES/CONSIDERATIONS
The Board could direct staff not to pursue the GFOA award for the ACFR. However, pursuing the award
is advised, a best practice, and consistent with Central San's strategic plan to goal to provide exceptional
customer service and maintain an excellent reputation in the community.
FINANCIAL IMPACTS
The acceptance of the audited ACFR for the comparative fiscal years ending June 30, 2021, and 2020
does not have direct fiscal impact on Central San. Staff intends to submit the attached ACFR to the
G FOA for the Certificate ofAchievement for Excellence in Financial Reporting program, for which there
is an application fee for submission of a ACFR for review based on total revenues of the entity applying.
Based on this sliding fee schedule, Central San's fee is expected to be $560. Funding necessary to
cover this cost was included in the adopted budget for the current fiscal year ending June 30, 2022.
COMMITTEE RECOMMENDATION
The Finance Committee reviewed this matter at its meeting on December 21, 2021 and recommended
RECOMMENDED BOARD ACTION
Accept the draft audited ACFR for the fiscal years ended June 30, 2021, and 2020, and the auditors'
memorandum on internal control and required communications for the fiscal year ended June 30, 2021.
Strategic Plan re -In
GOAL ONE: Customer and Community
Strategy 2 — Maintain a positive reputation
GOAL THREE: Fiscal Responsibility
Strategy 1— Maintain financial stability and sustainability, , Strategy 2 — Ensure integrity and transparency in financial
management
ATTACHMENTS:
1. Annual Comprehensive Financial Report for Fiscal Years Ended June 30, 2021 and 2020 (DRAFT)
2. Memorandum on Internal Control and Required Communications (DRAFT)
3. Sick Leave Accrual Trend Chart
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 102 of 220
N UAL
FINAL
OMPREH
IAL [ZEP(
0 '-JW ..
OR THE FiSCALYEARS ENDED UN
ENSIV
)RT
Page 6 of 104
Attachment 1
CENTRAL CONTRA COSTA SANITARY
DISTRICT
MARTINEZ, CALIFORNIA
ANNUAL COMPREHENSIV
FOR THE YEARS
Prepared By:
Finance Division
REPORT
AND 2020
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 104 of 220
Page 7 of 104
Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
Annual Comprehensive Financial Report
Table of Contents
For the Years Ended June 30, 2021 and 2020
INTRODUCTORY SECTION:
Letterof Transmittal............................................................................................... i
Board of Directors.................................................................................................ix
MissionStatement................................................................................................ x
OrganizationChart...............................................................................................A
Mapof Service Area............................................................................................xii
Certificate of Achievement.................................................................................. xiii
FINANCIAL SECTION:
Independent Auditors' Report ...................
Management's Discussion and Analysis
Basic Financial Statements
Statements of Net Position ..........
Statements of Revenues, ense
Statements of Cash Flows
Notes to Financial Stateme
integral part of the ' fit
Required Supplementa for t
Cost -Sharing tiple
Schedule of P na E
Scheduil
Post -WI
Sch'Sliul
SchedIR
Schedul
► ............................... 3
.............................. 11-12
Net Position.......... 13
........................ 14-15
ying notes are an
statements .................................... 16-45
refined Benefit Retirement Plan -
are of Net Pension Liability............
......... 47
............................... 48
]are Defined Benefit Plan —
es in the Net OPEB Liability and Related Ratios ...
..
Ftment Return Rate .................................................... 49
tributions..................................................................... 50
Supplementary InfoWation
Combining Schedule of Statement of Net Position .................................
Combining Schedule of Statement of Revenues, Expenses and
Changes in Net Position - Enterprise Sub -Funds .................................
STATISTICAL SECTION (Unaudited):
52
53
Changes in Net Position and Statement of Net Position -
Last Ten Fiscal Years.....................................................................................S-1
Revenue by Type - Last Ten Fiscal Years.........................................................S-2
Operating Expenses by Type - Last Ten Fiscal Years.......................................S-3
Major Revenue Base and Rates - Historical and Current Fees -
Last Ten Fiscal Years ...................... ............................................................... S-4
Assessed and Estimated Actual Valuation of Taxable Property -
Last Ten Fiscal Years.....................................................................................S-5
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Attachment 1
Property Tax and Sewer Service Charge Fees Levied and Collected -
Last Ten Fiscal Years..................................................................................... S-5
Sewer Service Charge - List of Ten Largest Customers -
Last Ten Fiscal Years..................................................................................... S-6
Payments Under the Concord Agreement -
Last Ten Fiscal Years..................................................................................... S-7
Active Service Accounts and Fiscal Year Billings -
Sewer Service Charges..................................................................................S-7
Summary of Debt Service - Type, Debt Service Coverage, Debt Ratio -
Last Ten Fiscal Years..................................................................................... S-8
Demographic and Economic Data - Population Served -
Last Ten Calendar Years................................................................................S-9
List of Nine Largest Employers in Contra Costa County
Last Year and Eight Years Ago......................................................................S-9
Demographic and Economic Statistics - Contra Cos ounty -
Last Ten Fiscal Years.............................................................................S-10
Full-time Equivalent Positions Filled by Depart
Last Ten Fiscal Years ............................... ...........................................S-11
Number of Retirees and Surviving Spous
Last Ten Fiscal Years ........................ ..................................................S-11
Capital Asset and Operating Statistics —
Last Ten Calendar or Fiscal Ye ...........................................................S-12
Miscellaneous Statistics .............. .. .................................................S-12
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 106 of 220
Page 9 of 104
Attachment 1
Decembqw 1 Regular FINANCE Committee Meeting Agenda Packet - Page 107 of 220
Page 10 of 104
Attachment 1
)ICENTRAL SAN
January 6, 2022
Central Contra Costa Sanitary District Customers and
The Honorable Board of Directors,
Martinez, California:
California Government Code section 26909 requires
with the California State Controller's Office within tv
fiscal year. This report is published to fulfill that
0
June 30, 2021 (FY 2020-21).
Management of Central Contra Cost
responsibility for the completeness anc
statements, based upon a comprehensi,
for this purpose. Because the cost of
benefits, the objective is to p�^t(
sl
financial statements are free
The District's independent a
("clean") opinion oror
The independent' re
report.
it to be completed and filed
the after the close of the
r the fiscal year ended
it strict (the District) assumes full
)ility the information in these financial
of
rnal controls that is established
�4*ol should not exceed anticipated
rather than absolute, assurance that the
isstatements.
Ma-MV& Associates, has issued an unmodified
ncial statements for the year ended June 30, 2021.
located at the front of the financial section of this
Management's Discussd Analysis report (MD&A) immediately follows the
independent auditors' repo and provides a narrative introduction, overview, and analysis
of the basic financial statements. The MD&A complements this letter of transmittal and
should be read in conjunction with it.
I9:Na144107a9:141CIGIV/4NZI►Yi14Z111111
History and Services Provided
The District was established in 1946 under the Sanitary District Act of 1923 and is located
approximately 30 miles east of San Francisco. The District builds, operates and maintains
the facilities required to collect and clean wastewater for approximately 344,000 residents
of Danville, Lafayette, Martinez, Moraga, Orinda, Pleasant Hill, San Ramon, Walnut
Creek and some of the unincorporated communities within central Contra Costa County.
The District also treats wastewater for approximately 141,000 residents of the Cities of
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Attachment 1
Concord and Clayton under a 1974 (and as subsequently amended) contract with the City
of Concord.
The District is committed to protecting the public health and preserving the environment
at responsible rates, through conducting long-range financial planning and managing
costs. The District has approximately 1,500 miles of sewer pipeline, ranging in size from
4 inches to 102 inches in diameter, and 19 sewage -pumping stations (three of which are
privately owned) in the District's sewage collection system. The District is the sole
provider of wastewater service within the District limits (see map of service area). The
residential segment makes up the largest segment of the District's customer base
representing approximately 81 % of the Sewer Service Charge operating revenue. The
District's treatment capacity has grown tremendously from a modest 4.5 million gallons
per day (mgd) in 1948 to 53.8 mgd currently. Bonds, state grants, federal grants, and
pay-as-you-go resources of the District have currAffinanpital expenditures and
capacity expansions, although in recent years, pources have been the
primary financing mechanism for the District's cahough a bond offering
in June 2021 will fund capital expenditures for a 0-21 and FY 2021-22
needs.
The District also operates an expanding Re c ter Program that provides high -
quality recycled water for non -drinking pur oses s as landscape irrigation at schools,
parks, playgrounds, median strips and p eIds, ell as dust control and industrial
process uses. Due to strong customer a trict maintained operation of its
residential recycled water fill st wh lows residential customers to obtain a
maximum of 300 gallons of r c wat per trip for use in hand watering lawns,
landscaping, and gardens. e rict actively pursues new recycled water
expansion opportunities to of the potential water supply that highly -
treated wastewater rep s, icularly given California's limited water supply. Goals
of this program incl exp n ycled water availability to District customers, and
potentially, putting valuabl cy ed water resource to beneficial use by augmenting
the region's water su throu a water exchange project currently being evaluated with
Contra Costa Water Di t a anta Clara Valley Water District. The District continues
to actively promote this p am with the position that recycling water is good for the
environment and provides an economic benefit to the community by ensuring a reliable,
drought -proof water supply for local schools, parks, and businesses.
In addition to its responsibility to collect and treat wastewater, the District also undertakes
pollution prevention initiatives through the operation and maintenance of a permanent
Household Hazardous Waste (HHW) Collection Facility in partnership with Mountain View
Sanitary District and other local governments. The HHW Collection Facility is located
adjacent to the District's wastewater treatment plant and seeks to keep pollutants out of
the sewer system, making this facility a vital part of our overall Pollution Prevention
Program. Having completed its 24th year of operation, the HHW Facility served over
36,000 residential and small business customers. On average, over two million pounds
of hazardous waste is collected and properly disposed of annually. While volumes
temporarily declined in the prior year due to a short-term closure at the onset of the
COVID-19 pandemic, HHW collection rebounded in FY 2021 having collected
ii
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 109 of 220
Page 12 of 104
Attachment 1
approximately 2.7 million pounds of waste. In conjunction with its HHW facility, the
District's Pharmaceutical Collection Program encourages pollution prevention having
collected just over 5,600 pounds of expired or unwanted medications between its thirteen
collection sites in calendar year 2021. Although this is a decline from last year's nearly
10,000 pounds of medications collected, the number of non -District collection sites has
increased to over 40 sites, which improves access to proper disposal in our service area.
Organization, Accounting and Budgetary Controls
A five -member Board of Directors (the Board) governs the District. Board members each
serve a different electoral district and are elected by voters from their electoral district on
a non -partisan basis serving four-year staggered terms. The Board appoints the General
Manager, who in accordance with policies established by the Board, manages District
affairs. The District employed 278 permanent regular full-time employees at year end out
of 291 authorized permanent regular full-time positions. Th employees are organized
into three departments steered by an Executive Governa unit. Department Directors
oversee and are responsible for the budgets and expe each department and their
underlying divisions. The three departments ar� dmi ration, Engineering and
Technical Services, and Operations.
As a California municipal utility, the District chM
sewer collection and treatment services. Acco
accounting principles issued by the G E
District uses full accrual enterprise fund a ou
similar, though not identical, to pri ind
fund for financial reporting purp s, ich or
funds for internal accountin roos .
s to external users for providing
y, pursuant to generally accepted
ita counting Standards Board, the
a count for its operations, which is
he istrict currently has one enterprise
prised of the following four internal sub-
0 Running Expense - unl&r the general operations of the District. Substantially
all operating rev s )cc
es are accounted for in this fund (also referred to
as the Operati & Mance or "O&M" Fund).
■ Sewer Construc -nts for non -operating revenues that are to be used for
acquisition or const plant, property, and equipment (also referred to as the
Capital Fund).
■ Self -Insurance - accounts for interest earnings on cash balances in this sub -fund and
cash allocations from other funds, as well as costs of insurance premiums and claims
not covered by the District's insurance policies.
■ Debt Service — accounts for activity associated with the payment of the District's long
term bonds and loans.
Each year, the Board adopts the following four budgets: Operations and Maintenance,
Capital Improvement (i.e. Sewer Construction), Self -Insurance, and Debt -Service. The
Board, Finance Committee and management review interim financial reports and
operational disbursements monthly. District management is accountable for variances
and adhering to overall budget constraints. The Board has delegated various contracting
and spending authority to the General Manager, as specified by an adopted Board policy.
Additional limited contracting and spending authority is further delegated to certain staff
classifications as specified by internal signature limits. The District also has several
iii
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Page 13 of 104
Attachment 1
documented financial policies (including debt management, investments, fiscal reserves,
etc.) that are periodically reviewed and updated to ensure their consistency with best
practices as well as changes in laws and regulations.
ASSESSING THE DISTRICT'S ECONOMIC CONDITION
Local Economy and Outlook
According to the State of California's Legislative Analyst's Office's (LAO), despite the
ongoing global pandemic and its disparate health and economic impacts on Californians,
revenues are growing at historical rates with the state projecting a $31 billion surplus for
allocation in FY 2022-23. Based on this outlook, the LAO examined the state's budget
condition through FY 2025-26 and assessed its capacity for new commitments, such as
spending increases or tax reductions. The LAO has found t the state budget does in
fact have such capacity, finding the operating surpluses r e from $348 billion over that
multiyear period. The LAO's FY 2022-23 fiscal outloo acknowledges this positive
news is tempered by questions of the long-term su abi f this revenue growth as
well as recent reports on inflation. In the mon llowing close of FY 2020-21,
resurgent consumer demand met with continu ricti in pro ction and transport of
many goods has led to higher -than -normal g t the prices of many goods and
services. To put this in context, since June 2021, al price inflation has exceeded 5%
compared to an average of 2% over th cad hile the LAO report recognizes
the consensus among economic forecas s i ck in inflation will abate by next
year, it also acknowledges this fo st c with ignificant uncertainty, underscored
by reports of further acceleratigtion October 2021.
According to the California I Ielopment Department (EDD), the Contra
Costa County workforc ea by approximately 3.4%from October 2020 to October
2021. During this s ti m nemployment in Contra Costa County decreased
from 8.4% to 5.3%, maining htl elow California as a whole, which decreased from
9.0% to 6.1 %. This nward end is positive news, particularly in comparison to the
peak of 15.1 % reporte tra Costa County in April 2020 near the onset of the
COVID-19 pandemic.
Long -Term Financial Planning
The District has an excellent reputation in providing public service, which includes
transparent and accessible governance, financial reporting and management, sewage
collection and treatment, training, workforce safety, capital improvements and
replacements, innovative use of technology, and customer service. This positive
reputation and long-term outlook has served the District well, evidenced by the significant
customer support and unanimous Board of Directors approval of a four-year sewer
service charge rate increase. Following the public noticing process and a public hearing
stipulated by Proposition 218, the sewer service charge rates approved in April 2019 will
be effective from July 2019 through June 2023. The four-year sewer service charge rate
annual increases range from 5.25% to 4.75%, subject to a Board review for continued
necessity prior to the start of each fiscal year. The planned increases are a critical
component of implementing the treatment plant and collection system capital
iv
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 111 of 220
Page 14 of 104
Attachment 1
improvement projects specified in the District's 20-year master plan adopted in 2017. Due
to the financial hardships brought on by the COVID-19 pandemic and related lock downs
in 2020, the Board took action and passed customer relief measures to prevent further
burdens on its customers. Specific measures taken included the freezing of rate
increases scheduled for FY 2020-21 and refunding schools' sewer service charges to
reflect a drop in water consumption while schools implemented remote learning in FY
2019-20, which continued into FY 2020-21.
In conjunction with the approved sewer service charge rates, the District's long-term
financial plan initially anticipated two debt issuances totaling $150-200 million to finance
its treatment plant and collection system capital improvement program through the fiscal
year ending June 30, 2024. This plan initially involved the District pursuing low interest
and federally subsidized State Revolving Fund loan financing up to $173 million through
the California Water Board necessary to finance the reh litation, replacement, and
upgrading of the solids handling incineration facility. Giv he solids handling projects'
significant and continued growth in cost estimates, in S er 2021 the Board changed
course from a continued major investment in incin on. MILinstead directed staff to
develop plans to transition the solids handling pro
the District's long-term master plan, but on an ce
approach will still necessitate debt financing, t x
to the Capital Improvement Program is till unce
staff, but is expected to cost less than t us I
of a revised 10-year Capital Improvemen ro
in time for the upcoming Financia��nnin sho
District management analyzjrand
seven goals in effect during 0
Customer an&Wc
an excellen4ffDutE
K
3
,s towardsestion, consistent with
leoed basis. While this alternative
financial impact of this transition
and currently being assessed by
Staff anticipates the completion
k
crporating this significant change
nticipated to occur in March 2022.
strategic plan every two years, with the
rovide exceptional customer service and maintain
ip - Meet regulatory requirements and promote
cage finances wisely and prudently,
4. Workforce Development - Recruit, empower, and engage a highly trained and
safe workforce,
5. Infrastructure Reliability - Maintain facilities and equipment to be dependable,
resilient, and long-lasting,
6. Innovation and Optimization - Explore new technologies for continuous
improvement, and
7. Agility and Adaptability - Preserve business continuity during pandemic events
or major natural disasters.
Environmen S
sustainability,
Fiscal Responsib
Strategies to achieve each of these seven goals are developed, as well as metrics to
evaluate success. Performance on achievement of the goals in the plan is reported
quarterly to the Board. The District updates a 10-year financial plan each year prior to
the completion, presentation, and adoption of the annual budget. The main economic
factors considered in this long-term forecasting exercise are: the impact of state
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 112 of 220
Page 15 of 104
Attachment 1
legislation and mandates, regulatory compliance, GASB reporting requirements,
negotiated labor contract terms (including projected changes in retirement and health
care costs), energy costs and interpreting the energy market, housing growth, and
infrastructure renewal and replacement needs. The unfunded actuarial accrued liabilities
(UAAL) for the District's pension and other post -employment benefit (OPEB) plans are
also considered in the financial planning process. Pursuant to the most recently issued
independent actuarial reports, the District currently has a strong fiduciary net position in
both plans of approximately 85.8% for its pension plan as of December 31, 2020 and
99.16% for its OPEB plan as of June 30, 2021. A Section 115 Pension Prefunding Trust
also has additional resources available to be used towards pension liabilities. When
incorporating these additional restricted trust assets, the pension plan's funded status is
elevated to 88.4% as of December 31, 2020. Most significantly, in conjunction with the
issuance of $50.57 million in certificates of participation generating $58.0 million in
proceeds to finance the capital budget, the District alloca additional sewer service
charges to the O&M Fund necessary to pay down the f 70.8 million balance of the
pension plan's UAAL effectively fully funding the pensi as of June 30, 2021. This
significant transaction is not reflected in CCCERA's aria ults as it was effectuated
after the report's December 31, 2020 valuation d^
The District antici
provide excellent
compliance requi
foreseeable futurE
Relevant Financie
id goals, continue to
:ustomers, and meet
trategic plan for the
Investment policies for the 11,
ct's ets, tI,OPEB Trust, and the Pension Prefunding
Trust are reviewed and appr the Board. During FY 2020-21 the District
Board directed an addi Dbcolnsidered
,000 be contributed to the Pension Prefunding Trust
as a mechanism to tential future employer pension contribution rate
volatility. As this rius , the Pension Prefunding Trust was subsequently
utilized in June 202 a balance of the pension plan's UAAL. Section 53646
of the California Goveode governs the District's investment practices, with
changes in legislation in the Board's annual review of District
investment policies. Additionally, the Board receives quarterly financial statements that
include District investment portfolio reports. The OPEB Trust and the Section 115
Pension Prefunding Trusts are governed by separate investment policies. Since 2008,
the OPEB Trust funds has been invested with a moderate investment strategy, reflecting
the relatively long-term horizon for use of the funds. The Section 115 Pension Prefunding
trust funds are invested using a moderately conservative strategy, reflecting the relatively
shorter term need for the funds. These two irrevocable trusts are managed by an outside
investment advisor subject to investment policies adopted by the Board. The Board
Finance Committee reviews the OPEB Trust and Section 115 Pension Trust performance
on a quarterly basis.
Major Initiatives
The District's vision statement in effect during FY 2020-21 was to be an industry -leading
organization known for environmental stewardship, innovation, and delivering exceptional
Vi
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 113 of 220
Page 16 of 104
Attachment 1
customer service at responsible rates. The Board and
this vision through the establishment of a Strategi
c
The District has received the Platinum award from the National Association of Clean
Water Agencies (NACWA) for 24 straight years in recognition of 100% compliance with
our National Pollutant Discharge Elimination System (NPDES) permit. It has also
reduced the number of sanitary sewer overflows by more than 85% in the past 18 years
by improved sewer cleaning and a robust sewer rehabilitation program.
As described previously, the District reviews and adopts a Strategic Plan every two years.
During FY 2021-22, the District Board and Management have been developing the new
Strategic Plan for FY 2022-23 and FY 2023-24, which is e cted to be completed and
adopted in the Spring of 2022, prior to the adoption of the 022-23 budget. The District
continues to analyze current and future rates, costs, an flows to ensure they remain
consistent with the cost of service study initially adop in F 14-15 then subsequently
reassessed for viability and re -adopted by the Bon FY 20 9.
In order to effectively manage assets
requirements, the District initiated an Ass
a Comprehensive Wastewater Master 1
regulatory requirements. The Master P12
to be used as a roadmap for capiL&Lrnp
projects are proposed in an an
for approval above specifie�
adoption of the Uniform
streamlined contractin
e state and federal regulatory
t Program and the preparation of
e options for addressing future
�d in FY 2016-17 and is intended
he next two decades. Individual
'tali ovement budget, and brought to the Board
rther re, in May 2018, the Board approved the
0
Accounting Act, which provides for a
I process for smaller capital projects.
The Government Finance�cers Association of the United States and Canada (GFOA)
awarded a Certificate of Achievement for Excellence in Financial Reporting to the District
for its annual comprehensive financial report (ACFR) for the fiscal year ended June 30,
2020. This was the 21st consecutive year that the District has achieved this prestigious
award. In order to receive the award, a government must publish an easily readable and
efficiently organized ACFR. This report must satisfy both generally accepted accounting
principles and applicable legal requirements.
A Certificate of Achievement for Excellence in Financial Reporting is valid for a period of
one year only. We believe that our current ACFR continues to meet the program's
requirements and we are submitting it to the GFOA to determine its eligibility for another
certificate.
Vii
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 114 of 220
Page 17 of 104
Attachment 1
This report could not have been accomplished without the dedication and commitment
provided by District staff. We would like to express our appreciation to the following
employees who assisted in its preparation:
■ The Finance Division who compiled the information contained in this document with a
special thanks to: Christopher Thomas, Accounting Supervisor; Olivia Ruiz,
Accounting Supervisor; Amal Lyon, Accountant; and Sue Goodrich, Temporary
Accountant.
■ The Reproduction and Graphics Team who creatively and professionally edited this
the ACFR for publication.
■ Engineering & Technical Services Department as well as Operations Department staff
who provided much of the statistical information included in this document.
■ The District's Board of Directors and Management team for their support in preparing
this document as well as their day-to-day support conducting the financial
operations of the District in a prudent and responsiblener.
Respectfully submitted,
Philip Leiber, CPA
Director of Finance & Administration
Mizuno, CPA
Manager
Viii
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 115 of 220
Page 18 of 104
Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
BOARD OF DIRECTORS
June 30, 2021
Tad J. Pilecki.................................................... President
David R. Williams ............................... President Pro-Tem
Barbara D. Hockett............................................. Member
Mariah N. Lauritzen ................................
I
Member
Vlember
ix
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 116 of 220
2 SO CENTRAL SAN
CENTRAL CONTRA COSTA SANITARY DISTRICT
VISION, MIS
9'*'. \/A LU E(:�
OUR MISSION
To protect public health and the environment
OUR VISION
To be an industry -leading organization known for ovironmental stewardship,
innovation, and delivering exceptional custom . 5 rvice at responsible rates
PEOPLE
Respect customers
and employees
Work effectively
and efficiently as a
team
Celebrate our
successes and
learn from our
challenges
OUR VA'_U FS
COMMUNITY
Collaborate with
water sector
partners
Foster cor , nunitN
relationship.
Be ,,jen, ')ns� rent,
J accessi, 'e
Unc, -stand arvice
level e, r .cations
PRIi iPLES
''� trut. iI and
rA `
Be fair, kind, and
`riendly
Take ownership and
responsibility
LEADERSHIPAND
COMMITMENT
Promote a passionate
and empowered
workforce
Encourage continuous
growth and
development
Inspire dedication and
top-quality results
Provide a safe and
healthful environment
LPL"r. ,�,
Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
Organization Chart - Composite
Electorate
Board
Members
General
Manage]
Director of Director of
Secretary of the D ty
District Finance and nag Engineering &
Administration Technical Svcs.
Information Ilel urn n Capital Projects
Technology Operations d Division
Plant Environmental &
Maintenance Regulatory
Compliance
Purchasing Plant d
Planning &
Materials Development
Services Operations Services
Communication Human
& Intergov. Resources
Relations
Risk
Management
Counsel for the
District
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 118 of 220
Page 21 of 104
Huacnmem i
j Central Contra Costa Sanitary District Service Area
• . June 30, 2021 Date: 12/13/2021
San
Pablo
Bay go
Hercules
�4
680
Benicia
Suisun Bay
(4) Pittsburg
rt�ineezz
�" r ❑ Antioch
7 Concord
Pleasant Hill
layton
■
Berkeley
24
San
Francisco
Bay
Orinda
Legend
Central San's Headquarter, Treatment Plant,
and HHW Collection Facility
Central San's Collection System Operations
Department (sewer maintenance) Building
❑ Wastewater collection and treatment and
HHW collection for 344,254 people
Wastewater treatment and HHW collection ❑
for 140,541 residents in Concord and Clayton
by contract
HHW disposal services only
Waln/Creek
nzo
Danville
4
D
San Ramon
AA 15
0 2 4 A
❑ Pump or Lift Station I I
❑ Privately Owned Pump Station Miles
Pump and Lift Stations
1.
Martinez
11.
Lower Orinda
2.
Fairview
12.
Bates Blvd. - Orinda
3.
Maltby
13.
Orinda Crossroads
4.
Clyde
14.
Moraga
5.
Concord Industrial
15.
San Ramon
6.
Buchanan Field North
16.
Wagner Ranch
7.
Buchanan Field South
17.
Lower Wilder
8.
Sleepy Hollow
18.
Upper Wilder
9.
Acacia
10.
Flush Kleen
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 119 of 220
Page 22 of 104
Attachment 1
Government Finance Officers Association
Centr
Certificate of
Achievement
for Excell
a Sanitary District
alifornia
R'its Comprehensive Annual
Financial Report
For the Fiscal Year Ended
June 30, 2020
Executive Director/CEO
XIII
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 120 of 220
NNUAL
OMPREHENSIV
"MA
IAL
Page 24 of 104
Attachment 1
FIA' M ACZTES
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
Central Contra Costa Sanitary District
Martinez, California
We have audited the accompanying financial statements of the business -type activities of the Central Contra Costa
Sanitary District (District) as of and for the years ended June 30, 2021 and 2020, and the related notes to the
financial statements, which collectively comprise the District'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 presentati2&f these filljklial statements in accordance with
accounting principles generally accepted in the United States o erica; this in s the design, implementation,
and maintenance of internal control relevant to the preparati nd f ' resentation of the financial statements that
are free from material misstatement, whether due to fraud or e
Auditor's Responsibility `
Our responsibility is to express opinions on the e finan me ased on our audits. We conducted our audits
in accordance with auditing standards gen epte the United States of America. Those standards require
that we plan and perform the audits to in re nable urance about whether the financial statements are free
from material misstatement.
An audit involves performing to in audit evidence about the amounts and disclosures in the financial
statements. The procedure ected d e auditor's judgment, including the assessment of the risks of
material misstatement of t ancial stat ents, whether due to fraud or error. In making those risk assessments,
the auditor considers intema trol rel nt to the District's preparation and fair presentation of the financial
statements in order to design au o es that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effe ess of the District'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
opinion.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective
financial position of the business -type activities of the Central Contra Costa Sanitary District as of June 30, 2021 and
2020, and the respective changes in financial positions and cash flows, where applicable for the years then ended in
accordance with accounting principles generally accepted in the United States of America.
Accountancy Corporation
3478 Buskirk Avenue, Suite 215
Pleasant Hill, CA 94523
r 925.930.0902
F 925.930.0135
e maze@mazeassociates.com
w mazeassociates.com
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 122 of 220
Page 25 of 104
Attachment 1
Change in Accounting Principles
Management adopted the provisions of Governmental Accounting Standards Board Statement No. 84 — Fiduciary
Activities, which became effective during the year ended June 30, 2021 and established the new fund type, Custodial
Funds, and eliminated the fund type of Agency Funds as discussed in Note 1 M to the financial statements.
Management early adopted the provisions of Governmental Accounting Standards Board Statement No. 98 — The
Annual Comprehensive Financial Report which changes the name of the Comprehensive Annual Financial Report to
Annual Comprehensive Financial Report.
Report on Summarized Comparative Information
We have previously audited the District's June 30, 2020 financial statements, and we expressed an unmodified audit
opinions on those audited financial statements in our report dated December 3, 2020. In our opinion, the
summarized comparative information presented herein as of and for the year e ded June 30, 2020 is consistent, in all
material respects, with the audited financial statements from which it has berived.
Other Matters
Required Supplementary h
Accounting principles generally accepted in the United States a require that Management's Discussion and
Analysis and other Required Supplementary Information, as din the table of contents, be presented to
supplement the basic financial statements. Such info althoNCO
f a part of the basic financial statements, is
required by the Governmental Accounting Standard oa ders it to be an essential part of financial
reporting for placing the basic financial statements in a n erational, economic or historical context. We
have applied certain limited procedures t quire pplementary information in accordance with auditing
standards generally accepted in the Unit tates Ame , which consisted of inquiries of management about the
methods of preparing the information coin i rmation for consistency with management's responses
to our inquiries, the basic financial sta , an r knowledge we obtained during our audit of the basic
financial statements. We do not an ion or provide any assurance on the information because the limited
procedures do not provide us suf 1 t e ce to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the pu�of forming an opinion on the financial statements that collectively comprise
the District's financial statements as a whole. The Supplementary Information listed in the Table of Contents is
presented for purposes of additional analysis and is not a required part of the financial statements.
The Supplementary Information is the responsibility of management and was derived from and relates directly to the
underlying accounting and other records used to prepare the financial statements. The information has been
subjected to the auditing procedures applied in the audit of the financial statements and certain additional
procedures, including comparing and reconciling such information directly to the underlying accounting and other
records used to prepare the financial statements or to the financial statements themselves, and other additional
procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion,
the Supplementary Information is fairly stated in all material respects in relation to the financial statements as a
whole.
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 123 of 220
Page 26 of 104
Attachment 1
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.
Pleasant Hill, California
December 21, 2021
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 124 of 220
Page 27 of 104
Attachment 1
Jl Central Contra Costa Sanitary District
MANAGEMENT'S DISCUSSION AND ANALYSIS
This section of the Central Contra Costa Sanitary District's (District) annual financial report presents an
analysis of the District's financial performance during the fiscal year ended June 30, 2021 (2020-21). This
information is presented in conjunction with the audited financial statements, which follow this report.
FINANCIAL HIGHLIGHTS
The District's 2020-21 financial highlights are listed below. These results are discussed in more detail
later in the report.
• The District's total ending net position increased by
increase is primarily due to the additional pension -re
expense adjustment recognized as a result of a $70
Employee Retirement Association, the Distri pe
contribution was made in June 2021 to pay off
Liability (UAAL) in conjunction with th issuance
of Participation (COPS). COPS with a pa $5
proceeds were issued to finance a portio f t
following fiscal years, allowing f redi n sewi
budget to its operating and m ' na bu
Ilion or 7.52% in 2020-21. This
defe outflows and negative pension
ribution to the Contra Costa County
tplan a inistrator. This significant
ion plan's Unfunded Actuarily Accrued
.e 2021 Wastewater Revenue Certificates
lVnillion to generate $58.0 million in net
l improvement budget in the current and
service charges from the District's capital
• Total revenues in 2020-21 in y . illion or 4.64%. Despite the Board's action in May
2020 to freeze the seuddWkwic7ftianze rate increase scheduled for 2020-21 as a customer relief
measure in respo o cust r h�hips faced by the pandemic, revenue attributable to sewer
service charges a ecured pr erty taxes still grew over the prior year due to continued property
value growth and de ment creasing the District's regional customer base. While total annual
sewer service charge r eviously approved to increase by 5.18% (to $629) for single family
homes and 5.30% (to $5 or multi -family homes, the Board -approved customer relief measure
resulted in these increases not being collected in 2020-21. Increased property values in the service
area led to an increase in property taxes of $1.6 million or 8.69%.
Total 2020-21 expenses increased by $4.7 million or 4.61 %. This increase is largely attributable
to budget savings in the prior fiscal year from temporary operational setbacks and disruptions
following the shelter -in -place mandates by the State and County in response to the COVID-19
pandemic in the Spring of 2020.
Capital Contributions decreased in 2020-21 by $6.4 million or 12.1%. The decrease is mainly due
to a decrease in contributions from the City of Concord for its share of treatment plant and other
eligible capital project costs as well as a reduced allocation of sewer service charges allocated to
finance the capital improvement budget following the issuance of the 2021 Wastewater
Certificates of Participation (2021 COPS) in June 2021.
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 125 of 220
Page 28 of 104
Attachment 1
OVERVIEW OF THE FINANCIAL STATEMENTS
The District operates as a utility enterprise and presents its financial statements using the economic
resources measurement focus and the full accrual basis of accounting. As an enterprise fund, the District's
basic financial statements are comprised of two components: financial statements and notes to the financial
statements. This report also contains other supplementary information in addition to the basic financial
statements themselves.
In accordance with the GASB Codification of Governmental Accounting and Financial Reporting
Standards, the District's annual financial balances and transactions are summarized and reported in the
following financial statements:
• Statement of Net Position — reports the District's
spendable resources) with capital assets, deferred
and deferred inflows of resources.
• Statement of Revenues, Expenses and Chang
and non -operating revenues by major source along
capital contributions.
• Statement of Cash Flows —
financing activities, capital
activities.
The following table shot'
District for the past three
resources (short-term
)urces, long-term obligations,
OFosition — reports the District's operating
operating and non -operating expenses and
sslWows from operating activities, non -capital
activities, investing activities, and non -cash
sTWement of net position of the Central Contra Costa Sanitary
5
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 126 of 220
Page 29 of 104
Attachment 1
Table 1 — Condensed Statement of Net Position
Year Ending June 30
2021 vs. 2020
2021 vs. 2019
$ Increase
% Increase
$ Increase
% Increase
2021
2020
2019
(Decrease)
(Decrease)
(Decrease)
(Decrease)
Assets
Current assets
$136,391,239
$164,102,632
$138,987,589
$(27,711,393)
-16.89%
$ (2,596,350)
-1.87%
Capital assets, net
760,567,573
711,564,564
677,392,935
49,003,009
6.89%
83,174,638
12.28%
Other non -current assets
36,572,236
11,478,481
9,752,616
25,093,755
218.62%
26,819,620
275.00%
Total assets
933,531,048
887,145,677
826,133,140
46,385,371
5.23%
107,397,908
13.00%
Deferred outflows
Pension related
95,805,386
26,670,166
46,715,613
69,135,220
259.22%
49,089,773
105.08%
OPEB related
4,117,730
2,176,533
2,836,089
1,941,197
89.19%
1,281,641
45.19%
Total deferred outflows
99,923,116
28,846,699
49,551,702
71,076,417
246.39%
50,371,414
101.65%
Liabilitie s
Current liabilities
28,102,111
15,854,317
14,404,545
12,247,794
77.25%
13,697,566
95.09%
Long-term liabilities
119,474,622
97,013,922
126,547,399
22,460
23.15%
(7,072,777)
-5.59%
Total liabilities
147,576,733
112,868,239
140,951,944
34,7 4
30.75%
6,624,789
4.70%
Deferred inflows
Pension related
48,100,435
30,761,867
23,736,976
17,338,5V65
24,363,459
102.64%
OPEB related
12 287,769
4,601,542
6,864
7 686
5,423,409
79.01%
Total deferred inflows
60,388,204
35,363,409
30,6 6
4,795
70.76%
29,786,868
97.34%
Net position
Net investment in capital assets
684,834,242
692,117,172W,562
82,930)
-1.05%
29,247,938
4.46%
Restricted
34,929,105
2,639
26,466
-1323473.51%
35,200,475
-12971.40%
Unrestricted
105,725,880
75,640,9170,084,963
39.77%
56,909,252
-116.58%
Total net position
$825,489,227
$76
57,728,499
7.52%
$121,357,665
17.24%
The total net position of the Distri<
20 and increased to $825.5 million
or 5.23% compared to 2019
increased $34.7 million o 50%o
2018-19. The increase i positi
largely from the District's sitil
savings through more afforda
a significant increase in capital
year timeframe.
r reas in$V4.1 million in 2018-19 to $767.8 million in 2019-
istrict's total assets have increased by $46.4 million
.4 million or 13.0% compared to 2018-19. Total liabilities
a o 2019-20 and increased $6.6 million or 4.7% compared to
r the three-year period totals $121.4 million, or 17.24%, resulting
t a1PERS for healthcare insurance, creating short and long-term
premiums for active and retired employee participants as well as
butions for a largely pay-as-you-go capital program over that three
As a public utility relying heavily on a complex infrastructure network, unsurprisingly by far the largest
portion of the District's net position (83.0%) reflects its investment in capital assets (e.g. land, buildings,
machinery, equipment, intangible assets, and sewer line infrastructure), less any related debt used to
acquire those assets that is still outstanding. The District uses these capital assets to provide services to
its ratepayers; consequently, these assets are not available for future spending. Although the District's
investment in its capital assets is reported net of related debt, it should be noted that the funds needed to
repay this debt must be provided from other sources, since the capital assets themselves cannot generally
be used to discharge these liabilities. The balance of $105.7 million in unrestricted net position increased
by $30.1 million from 2019-20 and increased by $56.9 million from 2018-19. As noted previously, this
increase was primarily a result of the District transitioning to a more economical provider for healthcare
insurance, reducing current healthcare premiums for active and retired employee participants as well as
resulting in significant reductions to the long-term net OPEB liability.
6
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 127 of 220
Page 30 of 104
Attachment 1
REVIEW OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION
The table below shows the condensed statement of revenues, expenses, and changes in net position for the
District for the past three fiscal years:
Table 2 - Condensed Statement of Revenues, Expenses, and Changes in Net Position
Year Ending June 30
2021 vs. 2020
2021 vs. 2019
$ Increase
% Increase
$ Increase
% Increase
2021
2020
2019
(Decrease)
(Decrease)
(Decrease)
(Decrease)
Revenues:
Operating revenues
Sewer service charges
$ 87,327,907
$ 85,332,494
$ 83,862,200
$ 1,995,413
2.34%
$ 3,465,707
4.13%
Other
1,914,654
1,890,285
1,815,966
24,369
1.29%
98,688
5.43%
Total operating revenue
89,242,561
87,222,779
85,678,166
2,019,782
2.32%
3,564,395
4.16%
Non -operating revenues
Property taxes
20,516,826
18,876,886
18,251,794
40
8.69%
2,265,032
12.41%
Permit and inspection fees
2,44Q187
2,251,245
2,648,708
88,942
8.39%
(208,521)
7.87%
Investment earnings
1,678,028
2,310269
2,573,964
241)
27.37%
(895,936)
34.81%
Other
3,193,569
1,219,811
1,424,52
1, 8
161.81%
1,769,049
124.19%
Total non -operating revenue
27,828,610
24,658,211
24,89
3,17 ,
12.86%
2,929,624
11.77%
Total revenues
117,071,171
111,880,990
11 52
5,190,18
4.64%
6,494,019
5.87%
Expenses
Operating expense other than depreciation
83,913,477
79,462,379
4,451,098
5.60%
31,617,906
60.46%
Depreciation
21,531,302
2125 062
20,9
278,240
1.31%
547,949
2.61%
Non -operating expenses
542,226
6
1,025,
(62,625)
10.35%
(482,780)
47.10%
Total expenses
105,987,005
101,32 2�36
4,666,713
4.61%
31,683,075
42.64%
Income before capital contributions
11,084,166�10,560,
523,468
4.96%
(25,189,056)
69.44%
Capital contributions
Increase in net position
Beginning net position, as restated
Ending net position
Revenue
Total operating revenues IncWeom$85.7 million in 2018-19 to $87.2 million in 2019-20 and
increased to $89.2 million in 2Operating revenues increased by $2.0 million or 2.32% compared
to 2019-20 and increased by $3.6 million or 4.2% comparing 2020-21 to 2018-19. This modest increase
in operating revenues is largely attributable to a slight decrease in the proportion of sewer service charges
allocated to the capital improvement program, which is reported as non -operating capital contributions,
following the issuance of the 2021 COPS and related payoff of the pension plan UAAL in June 2021 (after
the actuarial measurement date).
46,886,850 (6,424,135)-12.11% (242,517) -0.52%
�rPW 83,160,072 (5,900,667) 9.27% (25,431,573) 30.58%
,131,562 620,971,490 63,629,166 9.04% 146,789,238 23.64%
,760,728 $704,131,562 $ 57,728,499 7.52% $121,357,665 17.24%
Total non -operating revenue decreased from $24.9 million in 2018-19 to $24.7 million in 2019-20 and
increased to $27.8 million in 2020-21. Total non -operating revenues in 2020-21 increased compared to
2019-20 by $3.2 million or 12.86% and increased by $2.9 million or 11.77% comparing 2020-21 to 2018-
19.
Total revenues increased from $110.6 million in 2018-19 to $111.9 million in 2019-20 and increased to
$117.1 million in 2020-21. The change in total revenue represented an increase of $5.2 million or 4.64%
comparing 2020-21 to 2019-20 and an increase of $6.5 million or 5.87% comparing 2020-21 to 2018-19.
7
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Attachment 1
As described previously, despite the Board's action in May 2020 to freeze the sewer service charge rate
increase scheduled for 2020-21 as a customer relief measure in response to customer hardships faced by
the pandemic, revenue attributable to sewer service charges and secured property taxes still grew over the
prior year due to continued property value growth and development increasing the District's regional
customer base. While total annual sewer service charge rate was previously approved to increase by
5.18% (to $629) for single family homes and 5.30% (to $569) for multi -family homes, the Board -approved
customer relief measure resulted in these increases not being collected in 2020-21. Property tax revenue
increased by $1.6 million or 8.69% from 2019-20 to 2020-21, and $2.3 million or 12.4% comparing 2020-
21 to 2018-19 due to the continued increase in assessed property values, a healthy real estate market, and
development of residential and commercial real estate in the region.
Expenses
Total expenses increased from $74.3 million in 2018-19 to $101.3 million in 2019-20 and increased to
$106.0 million in 2020-21. In 2020-21, total expenses increased by $4.7 million or 4.61% compared to
2019-20. Comparing 2020-21 to 2018-19, total expenses were $31.7 million or 42.64% higher. As noted
previously, this increase is largely attributable to budget savings in prior fiscal year from temporary
operational setbacks and disruptions following the shelter-in-pla andates by the State and County in
response to the COVID-19 pandemic in the Spring of 2020. -o ting expenses are mainly driven
by interest expense.
Total income before capital contributions went from
20, and increased to $11.1 million in 2020-21. The
driven largely by savings attributable to the
Total capital contributions in 2020-21 were $46.6
million in 2018-19. This decrease was
charges to the capital program
in June 2021 as described Dre`
CAPITAL ASSETS
Ph in 2018-19, to $10.6 million in 2019-
reduction from 2018-19 to 2019-20 was
:S healthcare as noted previously.
1 million in 2019-20 and $46.9
a decrease in the allocation of sewer service
.021 COPS and payoff of the pension UAAL
Net capital assets for fis ears 202 1, 2019-20 and 2018-19 totaled $760.6 million, $711.6 million,
and $677.4 million, respec y. capital assets include the District's entire major infrastructure
including wastewater treatmen es, sewers, land, buildings, pumping stations, vehicles, intangible
assets and furniture and equipm exceeding the District's capitalization policy limit of $5,000, less
depreciation. As of June 30, 2021, the District's investment in capital assets totaled $760.6 million, an
increase of $49.0 million or 43.8% over the net capital asset balance of $711.6 million at June 30, 2020.
Net capital assets increased by $83.1 million or 12.3% comparing 2020-21 to 2018-19. A comparison of
the District's capital assets, net of depreciation, over the past three fiscal years is presented below:
Table 3 - Net Capital Assets
Structures, buildings, and
equipment
Land and rights of way
Construction in progress
Total
Year Ending June 30
2021
2020
2019
$ 631,932,004
$ 613,794,504
$ 609,205,177
22,290,077
22,290,077
22,270,077
106,345,492
75,479,983
45,917,681
760,567,573
711,564,564
677,392,935
2021 vs. 2020 2021 vs. 2019
$ Increase
% Increase
$ Increase
% Increase
(Decrease)
(Decrease)
(Decrease)
(Decrease)
$18,137,500
3.0%
$22,726,827
3.7%
-
0.0%
20,000
0.1%
30,865,509
40.9%
60,427,811
131.6%
49,003,009
43.8%
83,174,638
12.3%
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 129 of 220
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Attachment 1
The increase in capital assets, net of depreciation, of $49.0 million from 2019-20 to 2020-21 and $83.2
million from 2018-19 to 2020-21 is a result of an expanding capital improvement program over these
years, where spending has exceeded annual depreciation and recent capital spending being largely
financed by pay-as-you-go resources rather than debt. This year's major addition to construction -in -
progress includes the following:
Project Description
Moraga/Cro s s roads pump station project (8436)
Filter Plant & Clearwell Improvements Ph. IA (7361)
Outfall Improvements Ph. 7 (7353)
WC Sewer Renovations Ph. 14 (8460)
Martinez Sewer Renovation Ph. 6 (8458)
Lafayette Sewer Renovation Ph 14 (8459)
Danville Sewer Renovation Ph 3 (8456)
ERP Replacement (8250)
Solids Handling Facility Improvements (7348)
So. Orinda Sewer Renovation Ph. 8 (8461)
Total
Refer to Note 5 in the audited financial statements for
DEBT ADMINISTRATION
The total debt obligations, exclud
liabilities, for fiscal years 2020-21,
million, respectively. As of June 31
an increase of $56.3 million or 28,
increased by $53.9 millione021
dueto the issuance oft �
proceeds. The primary sl%Le of f
capital improvement progr s a
information on the Distri( s o
Capital Outlay
$ 14,148,216
8,068,424
5,054,203
4,155,140
3,665,295
3,362,734
3,006,827
' 2,739,651
2,720,704
17
s on the District's capital assets.
4esd to pension, OPEB and compensated absences
20 9 totaled $75.7 million, $19.4 million, and $21.8
1s outstanding debt totaled $75.7 million, which is
er balance of $19.4 million at June 30, 2020. Debt
ring 2020-21 to 2018-19. The increase in debt obligations is
it par value of $50.57 million, generating $58.0 million in
fledged to and securing the repayment of debt issuances for the
)rem secured property taxes. Refer to Note 6 for additional
debt obligations.
ECONOMIC FACTORS, NEXT YEAR'S BUDGET, AND RATES
The District operates as an enterprise fund primarily funded by fees charged to external customers for
services. The District charges rates and fees to customers to cover the costs of operation and maintenance
of the sewage collection and treatment system as well as costs associated with its capital improvement
program. External factors that may affect the District's financial position include, but are not limited to
the following:
• Regulatory requirements becoming more stringent, causing the District to spend more on compliance,
both for operations and maintenance costs as well as capital improvement and replacement projects.
• The economic cycle, creating volatility with capacity/connection fee revenues as new development
projects are highly sensitive to the economic cycle.
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Attachment 1
• Interest rate and/or investment return, which directly impacts investment earnings, borrowing costs,
and which has an adverse relationship to employer pension and OPEB contribution requirements.
• The consumer price index (CPI), which is a measure of inflation. The CPI for the San Francisco -
Oakland -Hayward area directly impacts the cost of living adjustments provided in the employee
MOUs. Higher than anticipated inflation may also adversely impact spending for contracted services,
energy, chemicals, and other materials/supplies necessary for wastewater collection and treatment
services.
Changes in assessed property values, which affect the District's non -operating ad valorem secured
property tax revenue. When the housing market grows, overall ssessed property values increase,
thereby increasing the District's property tax revenues. Convers any decline in the housing market
will decrease property values and correspondingly decrease lorem property tax receipts for the
District.
These factors, to
District's Board
construction cap
2021. Following
in April 2019 thf
timeframe spanni
assess whether th
budget. In June 2020, the
,f $90.7 million and sewer
d year ending June 30,
,ulated by Proposition 218,
charges for the four-year
i year the District shall re -
While the Board -approved custo elie effectively froze sewer service charge rates in the
fiscal year ended June 30, 2021 sewe ice charge rates for the fiscal year ending June 30, 2022 return
back to the rates previousl y Board in 2019. Accordingly, next fiscal year sewer service
charges will include the % rate ea of collected in 2020-21 as well as the 4.75% rate increase
previously approved an eduled 2021-22. While forgone for one year due to unprecedented
challenges faced during the demese approved rate increases are critical to meet the needs of an
greatly expanded capital impr t program in the next few years. As designed in the District's
financial model, steady but contro ed sewer service charge rate increases help prevent spikes in revenue
needs from customers in future years when annual capital spending is expected to significantly, but
temporarily, outpace annual revenues. This pay-as-you-go approach, paired with necessary debt
financing, ultimately helps to achieve rate stability. Primary drivers for the expansion of the capital
improvement program include the need to enhance and modernize the District's ageing infrastructure to
meet new regulatory requirements and ensure the sustainability of its infrastructure as the region's
population grows driving an increased demand for service capacity.
FINANCIAL CONTACT
The financial report is designed to provide the District's customers and creditors with a general overview
of District finances and to demonstrate the accountability and transparency for the rate and tax payer
money it receives. If you have questions about this report or need additional financial information,
contact: Kevin Mizuno, Finance Manager, Central Contra Costa Sanitary District, 5019 Imhoff Place,
Martinez, CA 94553.
10
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 131 of 220
Page 34 of 104
Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
STATEMENTS OF NET POSITION
JUNE 30, 2021 AND 2020
ASSETS
CURRENT ASSETS
Cash and cash equivalents (Note 2)
Short term investments (Note 2)
Accounts receivable, net (Note 3)
Employee computer loans receivable (Note 3)
Interest receivable
Parts and supplies
Prepaid expense
Total ci
NON -CURRENT A
Restricted cash
Assessment Dis
Capital assets:
Nondeprecial
Depreciable,
Total capil
Total n4
DEFERRED OUTF]
Pension related
OPEB related (I
Total dE
See accompanying notes to financial statements
2021
$49,027,092
54,700,000
27,009,462
10,684
37,772
3,086,194
2020
$111,856,324
20,000,000
27,985,589
12,893
256,559
2,295,555
1,695,712
164,102,632
10,422,954
1,055,527
97,770,060
613,794,504
711,564,564
723,043,045
887,145,677
26,670,166
2,176,533
28,846,699
(Continued)
11
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Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
STATEMENTS OF NET POSITION
JUNE 30, 2021 AND 2020
LIABILITIES
CURRENT LIABILITIES
Accounts payable and accrued expenses
Interest payable
Current portion of long-term obligations (Note 6)
Accrued compensated absences - current portion (Note 1.J.)
Provision for uninsured claims (Note 7)
Refundable deposits
Total currer
NON -CURRENT LIABI
Non -current portion
Accrued compensate
Net pension liability
Net OPEB liability (
Total non-ci
Ti
DEFERRED INFLOWS
Pension related (No1
OPEB related (Note
Total deferr
NET POSITION (Note 1
Net investment in ca
Restricted for debt s
Unrestricted
2021
2020
$15,161,757
$11,785,558
248,632
269,772
10,450,000
1,740,000
509,400
535,200
1,455,065
1,221,293
277,257
302,494
105,725,880
15,854,317
17,707,392
4,817,572
64,117,450
10,371,508
97,013,922
112,868,239
30,761,867
4,601,542
35,363,409
692,117,172
2,639
75,640,917
TOTAL NET POSITION $825,489,227 $767,760,728
See accompanying notes to financial statements
12
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Page 36 of 104
Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
STATEMENTS OF REVENUES, EXPENSES AND CHANGES IN NET POSITION
FOR THE YEARS ENDED JUNE 30, 2021 AND 2020
OPERATING REVENUES
Sewer service charges (SSC)
Service charges - City of Concord (Note 8)
Other services charges
Miscellaneous charges
Total operating revenues
OPERATING EXPENSES
Sewage collection and pumping stations
Sewage treatment
Engineering
Recycled water
Administrative and gene
Pension expense adjustn
OPEB expense adjustme
Depreciation (Note 5)
Total operating exp
OPERATING (LOSSES)
NONOPERATING REVE:
Taxes
Permit and inspection fe
Interest earnings
Interest expense
Other income (expense),
Total nonoperating
INCOME BEFORE CA F
CAPITAL CONTRIBUTI(
City of Concord contributions to capital costs (Note 8)
Customer contributions to capital cost (SSC)
Contributed sewer lines
Connection fees
Total capital contributions
CHANGE IN NET POSITION
NET POSITION, BEGINNING OF YEAR
2021 2020
$72,325,340
$70,408,903
15,002,567
14,923,591
1,171,378
1,176,242
743,276
714,043
89,242,561 87,222,779
18,183,752
16,671,998
24,783,779
26,998,492
15,278,784
15, 564,466
2,037,788
1,205,526
94,563,373
21,408,746
(67,027,225)
757,666
(3,906,774)
(3,144,515)
21,531,302
21,253,062
105,444,779 100,715,441
(16,202,218) (13,492,662)
20, 516, 826
18,876,886
2,440,187
2,251,245
1,678,028
2,310,269
(542,226)
(604,851)
3,193,569
1,219,811
27,286,384 24,053,360
11,084,166 10,560,698
10,064,155
11,393,000
30,156,394
32,829,958
923,468
1,761,808
5,500,316
7,083,702
46,644,333 53,068,468
57,728,499 63,629,166
767,760,728 704,131,562
NET POSITION, END OF YEAR $825,489,227 $767,760,728
See accompanying notes to financial statements
13
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Page 37 of 104
Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED JUNE 30, 2021 AND 2020
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
Payments to suppliers
Payments to employees and related benefits
Net cash provided by operating activities
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES
Receipt of taxes
Inspection/permit fees and other non -operating income
Net cash proviaea by
CASH FLOWS FROM CAP]
Capital contributions
Connection fees
Acquisition and constructii
Interest paid on long-term
Proceeds from issuance of
Bond premium
Principal payments on lonl
Net cash used for capi
CASH FLOWS FROM INVE
Redemption of investment;
Acquisition of investments
Interest received
Net cash provided by
NET INCREASE (DECREA
Cash, beginning of year
Cash, end of year
2021 2020
$89,780,414 $84,135,233
(43,269,319) (43,500,766)
(109,867,047) (36,604,529)
(63,355,952) 4,029,938
20, 516, 826 18,876, 886
5,633,756 3,471,056
26,150,582 22,347,942
40,220,549
44,222,958
5,500,316
7,083,702
(69,610,843)
(53,662,883)
(563,366)
(623,584)
50,570,000
7,870,179
(2,154,240)
(2,359,239)
31,832,595 (5,339,046)
145,000,000
100,000,000
179,700,000)
(67,000,000)
1,896,815
2,053,710
(32,803,185)
35,053,710
(38,175,960)
56,092,544
122,279,278
66,186,734
$84,103,318 $122,279,278
(Continued)
See accompanying notes to financial statements
14
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Page 38 of 104
Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED JUNE 30, 2021 AND 2020
Reconciliation of operating (loss) to net cash provided by
operating activities:
Operating income (losses)
Adjustments to reconcile operating losses to cash
flows from operating activities:
Depreciation
Changes in assets and liabilities:
Receivables, net
Parts and supplies
Prepaid expenses
Accounts payable and accrued expenses
Accrued payroll and related expenses
Refundable deposits
Claims
Net pension liability
Net OPEB liability
Net cash provided (used) by operating activities
SCHEDULE OF NON CASH ACTIVITY
Change in fair value of investments
Capital contributions
Total non cash activity
CASH AND CASH EQUIVALENTS, AS
STATEMENT OF NET POSITION:
Unrestricted cash and cash
Restricted cash and cash ec
Total cash and cash
notes to financial statements
2021 2020
($16,202,218) ($13,492,662)
21,531,302 21,253,062
537,853
(3,087,546)
(790,639)
(109,557)
(824,323)
(294,702)
3,376,199
1,828,812
(258,680)
305,169
(25,237)
(49,303)
233,772
63,496
(67,027,207)
757,684
(3,906,774)
(3,144,515)
W,355,952) $4,029,938
$1,896,815 $2,053,710
923,468 1,761,808
$2,820,283 $3,815,518
$49,027,092 $111,856,324
35,076,226 10,422,954
$84,103,318 $122,279,278
15
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 136 of 220
Page 39 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 1— DESCRIPTION OF DISTRICT AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
A. Reporting Entity
The Central Contra Costa Sanitary District (District), a special district and a public entity
established under the Sanitary District Act of 1923, provides sewer service for the incorporated
and unincorporated areas under its jurisdiction. A Board of Directors comprised of five elected
members governs the District.
As required by accounting principles generally accepted in the United States of America, these
basic financial statements present the financial statements of Central Contra Costa Sanitary
District and its component unit. The component unit discussed in the following paragraph is
blended in the District's reporting entity because of the si 'ficance of its operational and
financial relationship with the District.
Blended Component Unit - Component units are le a sep a organizations for which the
District is financially accountable. Component may alsoIIIIIIIII11whide organizations that are
fiscally dependent on the District, in that the Di approves their get, the issuance of their
debt or the levying of their taxes. In addi co ent units are other legally separate
organizations for which the District is not finance countable but the nature and significance
of the organization's relationship with th istrict is that exclusion would cause the District's
financial statements to be misleading lete. or financial reporting purposes, the
component unit discussed below is repo in . ict's financial statements because of the
significance of its relationship he Di ' The component unit, although a legally separate
entity, is reported in the fin, men sing the blended presentation method as if it were
part of the District's oper s bec e the verning Board of the component unit is the same
as of Governing Board of is se its purpose is to finance facilities to be used for
the direct benefit of t istr he Central Contra Costa Sanitary District Facilities Financing
Authority (Author' an solely for the purpose of providing financial assistance to the
District. The ority d this acquiring, constructing, improving and financing various
facilities, land equipme purchases, and by leasing or selling certain facilities, land and
equipment for the bene nd enjoyment of the public served by the District. The Authority
has no employees an and of Directors of the Authority consists of the same persons who
are serving as the Bo of Directors of the District. There are no separate basic financial
statements prepared for the Authority.
B. Basis of Accounting
The District's financial statements are prepared on the accrual basis of accounting. The District
applies all applicable Governmental Accounting Standards Board (GASB) pronouncements for
accounting and financial reporting guidance.
REVIEW DRAFT
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Page 40 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 1— DESCRIPTION OF DISTRICT AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (Continued)
The District is a proprietary entity; it uses an enterprise fund format to report its activities for
financial statement purposes. Enterprise funds are used to account for operations that are
financed and operated in a manner similar to private business enterprises, where the intent of the
governing body is that the cost and expenses, including depreciation, of providing goods or
services to its customers be financed or recovered primarily through user charges; or where the
governing body has decided that periodic determination of revenues earned, expense incurred,
and net income is appropriate for capital maintenance, public policy, management control,
accountability, or other purposes.
Enterprise funds are used to account for activities similar to those in the private sector, where the
proper matching of revenues and costs is important and the accrual basis of accounting is
required. With this measurement focus, all assets and liabil' of the enterprise are recorded on
its statement of net position, all revenues are recognized 00%arned and all expenses, including
depreciation, are recognized when incurred.
Enterprise funds (
Operating revenues
delivering goods it
;tinguish operating re
ind expenses generally
connection with an en
principal operating revenues of the D' 'Ci
expenses for the District include the c
depreciation on capital assets. All reven
as non -operating revenues and uses.
For internal operating pi:
sub -funds, each of which
approved budget for
enterprise fund p
these sub -fund as fol:
Running
:penses 'qWm non -operating items.
:)viding services and producing and
principal ongoing operations. The
customers for services. Operating
rvices, administrative expenses, and
t meeting this definition are reported
;oard of Directors has established four separate
F balancing set of accounts and a separate Board
These sub -funds are combined into the single
The nature and purpose of
rig Expense accounts for the general operations of the District.
revenues and expenses are accounted for in this sub -fund.
Sewer Construction — Sewer Construction accounts for non -operating revenues, which
are to be used for acquisition or construction of plant, property and equipment.
Self -Insurance — Self -Insurance accounts for interest earnings on cash balances in this
sub -fund and cash allocations from other sub -funds, as well as for costs of insurance
premiums and claims not covered by the District's insurance coverage.
Debt Service — Debt Service accounts for activity associated with the payment of the
District's long term bonds and loans.
That portion of the District's net position which is allocable to each of these sub -funds has been
shown separately in the accompanying supplementary information to the financial statements.
REVIEW DRAFT
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Page 41 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 1— DESCRIPTION OF DISTRICT AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (Continued)
C.
0
Investments
Investments held at June 30, 2021 and 2020 with original maturities greater than one year, are
stated at fair value. Fair value is estimated based on quoted market prices at year-end. All
investments not required to be reported at fair value are stated at cost or amortized cost.
Fair Value Measurements
Fair value is defined as the price that would be received to sell an asset or paid to transfer a
liability in an orderly transaction between market participants at the measurement date. The
District categorizes its fair value measurements within the f value hierarchy established by
generally accepted accounting principles. The fair value rarchy categorizes the inputs to
valuation techniques used to measure fair value into thr is based on the extent to which
inputs used in measuring fair value are observable in th arke
Level 1 inputs are quoted prices
liabilities.
Level 2 inputs are inputs —
observable for an asset or lia
Level 3 inputs are
If the fair value of an a;
fair value hierarchy, the
that is significant to
E. Prepaid
Certain payments'♦
recorded as prepaid
F. Bank Escrow Deposit
for identical assets or
-s included within level 1 — that are
indirectly.
using inputs from more than one level of the
to be based on the lowest priority level input
reflect costs applicable to
financial statements.
accounting periods and are
An escrow agreement was formed between the District and the National Park Service for the
right-of-way through the John Muir National Historic Site, in lieu of issuing a performance bond.
The current right-of-way permit is 10 years, but is renewable and must remain in effect so long as
there is sewage running through the area; therefore, it is unlikely that the escrow funds will ever
be released to the District. These funds are listed as restricted cash in the financial statements.
G. Parts and Supplies
Parts and supplies are valued at average cost and are used primarily for internal purposes.
REVIEW DRAFT
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Page 42 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 1— DESCRIPTION OF DISTRICT AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (Continued)
H.
L
Property, Plant, and Equipment
Purchased capital assets are stated at historical cost. Capital assets contributed to the District are
reported at acquisition value. The capitalization threshold for capital assets is $5,000.
Expenditures which materially increase the value or life of capital assets are capitalized and
depreciated over the remaining useful life of the asset.
Depreciation of exhaustible capital assets has been provided using the straight-line method over
the asset's useful life as follows:
Property
Property
Contra C
collected
General (
Californi,
provided
mechanis
agencies
system is
County it
Years
75
75
40
50
5-15
7-15
is levied. The County of
all material amounts are
the County participates in
[an. The Teeter Plan as
ation Code establishes a
and other levies to taxing
;ollections. Although this
sk of delinquencies. The
Secured property tax bWare mailed once a year, during the month of October on the current
secured tax roll, to the owner of the property as of the lien date (January 1). Payments can be
made in two installments, and are due on November 1 and February 1. Delinquent accounts are
assessed a penalty of 10 percent. Accounts which remain unpaid on June 30 are charged an
additional 11/2 percent per month. Unsecured property tax is due on July 1 and becomes
delinquent on August 31. The penalty percentage rates are the same as secured property tax.
REVIEW DRAFT
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December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 140 of 220
Page 43 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 1— DESCRIPTION OF DISTRICT AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (Continued)
J. Compensated Absences
The liability for vested vacation, compensatory time, and sick pay is recorded as an expense when
earned. District employees have a vested interest in 100 percent of accrued vacation time and 85
percent of accrued sick time for employees hired before May 1, 1985 (the last employee hired
prior to this date retired during the fiscal year ending June 30, 2021). Employees hired after May
1, 1985 have a vested interest in up to 40 percent of their sick time, based upon length of
employment with the District. The time may be applied towards pension service time and/or
cashed out upon retirement.
The changes in compensated absences were as follows for fisca ears ended June 30:
2021 2020
Beginning Balance $5,35 $5,047,603
Additions 779 755,277
Payments , (450,108)
Ending Balance $5,0 2 $5,352,772
Current Portion 40 $535,200
The current portion of the liab'le ithin the next year is estimated by management to
be approximately 10% oft d
MW
K. Statement of Cash Flows
For purposes oQava
h flows, all highly liquid investments, including restricted
assets, with m nths or less when purchased, are considered to be cash
equivalents. Ire petty cash, bank accounts, and the State of California Local
Agency InvestF). Restricted assets are debt service amounts maintained by
fiduciaries and general expenses.
L. Use of Estimates
The preparation of financial statements in conformity with accounting principles generally
accepted in the United States of America requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent
assets and liabilities at the date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from those estimates.
REVIEW DRAFT
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Page 44 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 1— DESCRIPTION OF DISTRICT AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (Continued)
M.
N.
New Governmental Accounting Standards Board Statement Pronouncement
GASB 84 — Fiduciary Activities — The objective of this Statement is to improve guidance
regarding the identification of fiduciary activities for accounting and financial reporting purposes
and how those activities should be reported. The District implemented the provisions of this
Statement during the year ended June 30, 2021. As a result, the District determined that the
activities of the Other Post -Employment Benefit Trust Fund should no longer be reported in the
Other Post -Employment Benefit Trust Fund, since the District does not have control of the assets
of the OPEB Plan as a whole. Therefore, the Other Post -Employment Benefit Trust Fund is no
longer reported in the financial statements as of July 1, 2020.
Prior -Period Comparative Statements
The basic financial statements include certain prio
total, but not at the level of detail required for
accepted accounting principles. Accordingly,
with the District's financial statements for
summarized information was derived.
NOTE 2 — CASH AND INVESTMENTS
A.
Summary of Cash and Ij
Cash and investments as
follows:
Cash and ca
Short term mve
Restricted cash
Total District Cas
Investments
Cash and Investments held with Pension Trust
Total Cash and Investments
%Led comparative information in
Dfl4Waccordance with generally
►n s d be read in conjunction
June 30, 2020, from which the
in the accompanying financial statements as
2021
$49,027,092
54,700,000
35,029,105
138,756,197
2020
$111,856,324
20,000,000
100,000
131,956,324
47,121 10,322,954
$138,803,318 $142,279,278
REVIEW DRAFT
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21
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 142 of 220
Page 45 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 2 — CASH AND INVESTMENTS (Continued)
B. Policies and Practices
The District is authorized under California Government Code to make direct investments in local
agency bonds, notes, or warrants within the State: U.S. Treasury instruments, registered State
warrants or treasury notes, securities of the U.S. Governments, or its agencies, commercial paper,
certificates of deposit placed with commercial banks and/or savings with loan companies, and
certificates of participation. State code and the District's investment policy prohibit the District
from investing in investments with a rating of less than A or equivalent.
Investments purchases and sales are coordinated by the District's Treasurer, Contra Costa
County, at the request of the District.
C. General Authorizations
Limitations as they relate to interest
rate risk, credi
an ncentration of credit
risk are
indicated in the schedules below:
District
District
S
imits
Policy
Policy
Maximum
Maximum
um
Maximum
Percentage
Minimum
Re
Perc e
Investment
of Portfolio
Credit
Authorized Investment Type
Ma
Port
In One Issuer
(Per Issuer)
Quality
U.S. Treasury Obligations
5 ye
None
100%
N/A
U.S. Government Agency Issues
5 year
None
None
100%
N/A
Money Market Funds
N/A
20%
10%
10%
A
Negotiable Certificates of Deposit
5 ears
30%
None
5%
AA
Banker's Acceptances
40%
40%
5%
N/A
Commercial Paper (1)
270
25%
10%
10%
A-1
Medium Term Notes
5 years
30%
None
5%
AA
Collateralized Certificates of sit (2)
5 years
None
None
20%
Aaa
Supranationals
5 years
30%
5%
5%
AA
County Pooled Investment Funds
N/A
None
None
100%
N/A
Local Agency Investment Fund (LA
N/A
None
$75 million
100%
N/A
Government Investment Pools (CAMP, t, etc)
N/A
None
$75 million
100%
N/A
(1) Prime quality; limited to corporations with assets over $500,000,000
(2) Prior approval of the Board of Directors must be obtained to acquire maturities beyond one year, excluding
Treasury Notes and LAIF.
REVIEW DRAFT 12/15/2021 4:16 PM
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Page 46 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 2 — CASH AND INVESTMENTS (Continued)
D. Fair Value Hierarchy
The District categorizes its fair value measurements within the fair value hierarchy established by
generally accepted accounting principles. The hierarchy is based on the valuation inputs used to
measure fair value of the assets. Level 1 inputs are quoted prices in an active market for identical
assets; Level 2 inputs are significant other observable inputs; and Level 3 inputs are significant
unobservable inputs.
The following is a summary of the fair value hierarchy of the fair value of investments of the
District as of June 30:
Investment Type
Investments Reported at Fair Value:
U.S. Treasury Obligations /
Total
Investments Measured at
Money Market Funds
External Investment Pool
California Local Agenc
Investments Exem it
Restricted Cash
Cash and I el(
Cash in and !%61
2021
2 Total
$25,000,000
),0 25,000,000
386,779
29,700,000
34,642,326
47,121
49,027,092
$138,803,318
U.S. Treasury Obliglling $25 million classified in Level 2 of the fair value hierarchy, is
valued using matrix prilWg techniques maintained by various pricing vendors. Matrix pricing is
used to value securities based on the securities' relationship to benchmark quoted prices.
REVIEW DRAFT
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December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 144 of 220
Page 47 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 2 — CASH AND INVESTMENTS (Continued)
The following is a summary of the fair value hierarchy of the fair value of investments of the
District as of June 30:
Investment Type
hivestments Reported at Fair Value:
U.S. Federal Agency Securities -FBLB
Total Investments
tnws tmen
Califomiz
Tot
Cash and
Cash in b
Tota
U.S. Federa
hierarchy, i;
Matrix prici
quoted price
E. Interest Rati
Interest rate
of an invests
its fair value
interest rate
timing cash
maturity eve
District poli
Treasury Nc
Board approval.
2020
Level 2 Total
$20,000,000 $20,000,000
$20,000,000 20,000,000
75,000,000
95,000,000
10,322,954
36,956,324
$142,279,278
-vel 2 of the fair value
various pricing vendors.
lationship to benchmark
-rsely affect the fair value
greater the sensitivity of
cy to manage exposure to
term investments and by
tturing or coming close to
city needed for operations.
rs, with the exception of
s can be held longer with
REVIEW DRAFT
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Page 48 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 2 — CASH AND INVESTMENTS (Continued)
Information about the sensitivity of the fair values of the District's investments to market interest
rate fluctuation is provided by the following schedule that shows the distribution of the District's
investments by maturity, as of June 30:
2021
12 Months
Investment Type
or less
Maturity
U.S Treasury Obligations
$25,000,000
7/15/2021
California Local Agency Investment Fund
29,700,000
Money Market Funds
386,779
Total
55,086,779
Restricted Cash
34,642,326
Restricted Cash and Investments held with Pension Trust
47,121
Cash in bank
27,092
Total Cash and Investments
$13 , 318
2020
12 Months
Investment T a
or k
Maturity
U.S Federal Agency Securities -
$20,000,000
9/25/2020
California Local Agency Inve nt Fu
75,000,000
Total Investments
95,000,000
Restricted
Restricted
Cash in ba.
Total (
100,000
Pension Trust 10,322,954
36,856,324
$142,279,278
REVIEW DRAFT
12/15/2021 4:21 PM
25
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 146 of 220
Page 49 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 2 — CASH AND INVESTMENTS (Continued)
Investment in LAIF — The District is a voluntary participant in LAIF which is regulated by the
California Government Code under the oversight of the Treasurer of the State of California. LAIF is
not registered with the Securities and Exchange Commission. The fair value of the District's
investment in this pool is reported in the accompanying financial statements at amounts based upon
the District's pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio (in
relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the
accounting records maintained by LAIF, which are recorded on an amortized cost basis. At June 30,
2021 and 2020, these investments had weighted average maturities of 291 and 191 days,
respectively.
Investments in County Treasury — The District is considered to be a voluntary participant in an
external investment pool. The fair value of the District's inves nt in the pool is reported in the
financial statements in cash and cash equivalents at mounts b upon the District's pro-rata share
of the fair value provided by the County Treasurer for the ortfolio (in relation to amortized
cost of that portfolio). The balance available for with al 1 sed on the accounting records
maintained by the County Treasurer, which is record�h the amo cost basis.
F. Credit Risk
Credit risk is the risk that an issuer of;
the investment. This is measured by
statistical rating organization. Presen
investment type as provided b,
top rating for short term inve n
Rated P-1:
U.S. Treasury Ob ons
U.S. Federal Agency
Money Market Funds
Total Rated Investments
Not rated:
California Local Agency Investment Fund
Restricted Cash and Cash Equivalents
Cash and Investments held with Pension Trust
Cash in Bank
Total Cash and Investments
not fulfill its obligation to the holder of
ka rating by a nationally recognized
actual rating as of June 30, of each
ig system, of which a P -1 rating is the
Totals
2021 2020
$25,000,000
$20,000,000
386,779
25,386,779 20,000,000
29,700,000
34,642,326
47,121
49,027,092
75,000,000
100,000
10,322,954
36,856,324
$138,803,318 $142,279,278
REVIEW DRAFT
12/15/2021 5:05 PM
26
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 147 of 220
Page 50 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 2 — CASH AND INVESTMENTS (Continued)
G.
H.
Concentration of Credit Risk
There are no covered investments that represent in excess of 5% of the District's total
investments as of June 30, 2021.
Custodial Credit Risk — Investments
Custodial risk for investments is the risk that, in the event of the failure of the counterparty (e.g.
the 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 does not contain legal or policy requirements that would limit the exposure to
custodial credit risk. As a voluntary pool participant, the Cou Treasurer's office transacts the
District's investment decisions in compliance with the requi ents of the District's policy. The
County Treasurer's Office will execute the District's i nts through such broker -dealers
and financial institutions as are approved by the C ty surer, and through the State
Treasurer's Office for investment in the Local Aeen District's
d.
NOTE 3 — ACCOUNTS RECEIVABLE
Accounts receivable for the years
City of Concord (see Note
Household Hazardous Wai
All Other
Total Accounts
Employee
of the following:
$25,112,937
1,077,027
2020
$26,362,258
832,005
819,498 791,326
$27,009,462 $27,985,589
The District provides o its employees for the purchase of personal computers. These loans
are payable through paroll deductions of $100 until the loan is paid off. The interest rate
associated with the loan is based of the most current Local Agency Investment Fund (LAIF) rate.
The maximum amount each employee may borrow is $2,000. The loans receivable balances were
as follows as of June 30:
Employee Computer Loans
Additions
2021 2020
$12,893 $15,736
11,123 11,640
Payments (13,332) (14,483)
Total Loan Receivable $10,684 $12,893
REVIEW DRAFT 12/14/2021 5:40 PM
27
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Page 51 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 4 — ASSESSMENT DISTRICTS RECEIVABLE
The District established the Contractual Assessment District (CAD) program to help homeowners finance
the cost of connecting to the District. The construction costs associated with the project within the
program are capitalized and depreciated. Individual homeowners are assessed at an amount equal to their
share of the construction costs and connection fee. The assessments, plus interest, are generally payable
over 10 years. The CAD receivable balance at June 30, 2021 and 2020 was $914,700 and $339,613,
respectively.
The District also established the Alhambra Valley Assessment District (AVAD) to provide services to
residents in the Alhambra Valley in Martinez. Residents have the choice to pay cash or finance the
construction costs and connection fees. The AVAD receivable balance at June 30, 2021 and 2020 was
$581,310 and $715,914, respectively.
The total receivable
$1,055,527, respective
AD was $1,496,010 and
If Net Position.
REVIEW DRAFT
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28
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 149 of 220
Page 52 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 5 — CAPITAL ASSETS
Property, plant and equipment, and construction in progress are summarized below for the year
ended June 30, 2021:
Capital assets not being depreciated:
Land
Easements (intangible)
Construction in Progress
Total nondepreciated assets
Capital assets being depreciated:
Sewage collection system
Contributed sewer lines
Outfall sewers
Sewage treatment plant
Recycled water infrastructure
Pumping stations
Buildings
Furniture and equipment
Motor vehicles
Enterprise software
Total depreciated assets
Less accumulated depreciation:
Sewage collection system
Contributed sewer lines
Outfall sewers
Sewage treatment plant
Recycled water infrastructure
Pumping stations
Buildings
Furniture and equipment
Motor vehicles
Enterprise software
Total accumulated depreciation
Total capital assets being
depreciated, net
Capital assets, net
Balance at
June 30, 2020
Additions Retirements
$17,320,570
4,969,507
75,479,983 $69,610,843
97,770,060 69,610,843
Transfers & Balance at
Adjustments June 30, 2021
$17,320,570
4,969,507
($38,745,334) 106,345,492
(38,745,334) 128,635,569
412,002,475
1000)
5,147,655
415,550,130
164,093,221
923,468
846)
1,096,657
166,020,500
11,371,574
11,371,574
358,464,912
(1,040,0
21,912,538
379,337,450
20,451,991
(1,000,000)
7,920,957
27,372,848
57,327,020
202,089
57,529,109
44,439,279
299,598
44,738,877
15,276,163
1,068,066
16,344,229
8,711,241
(338,233)
1,097,774
9,470,782
3,365,658
3,365,658
1,095,503,434
3,
(4,071,079)
38,745,334
1,131,101,157
84,20
601,580
(1,600,000)
88,208,487
6
2,172,218
(92,846)
67,885,601
1,165
150,553
4,221,718
2,001
7,844,525
(1,040,000)
(3,650,507)
246,686,019
10, 8
727,687
(1,OOQ000)
3,65Q507
14278,072
39,17 , 3
1,862,006
41,033,139
16,704,923
1284,668
17,989,591
11,520,782
996,530
12,517,312
5,291,063
554,969
(338,233)
5,507,799
504,849
336,566
841,415
481,708,930
21,531,302
(4,071,079)
499,169,153
613,794,504
(20,607,834)
38,745,334
631,932,004
$711,564,564
$49,003,009
$760,567,573
REVIEW DRAFT 12/14/2021 5:40 PM
29
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 150 of 220
Page 53 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 5 — CAPITAL ASSETS (Continued)
Property, plant and equipment, and construction in progress are summarized below for the year
ended June 30, 2020:
Capital assets not being depreciated:
Land
Easements (intangible)
Construction in Progress
Total nondepreciated assets
Capital assets being depreciated:
Sewage collection system
Contributed sewer lines
Outfall sewers
Sewage treatment plant
Recycled water infrastructure
Pumping stations
Buildings
Furniture and equipment
Motor vehicles
Enterprise software
Total depreciated assets
Less accumulated depreciation:
Sewage collection system
Contributed sewer lines
Outfall sewers
Sewage treatment plant
Recycled water infrastruc
Pumping stations
Buildings
Furniture and equipment
Motor vehicles
Enterprise software
Balance at Transfers & Balance at
June 30, 2019 Additions Retirements Adjustments June 30, 2020
$17,320,570
4,949,507
45,917,681 $53,662,883
68,187,758 53,662,883
58,161 ,
5,451,745
2,189,734
<3,19,770
151,395
04,155
7,827,846
55,662
544,216
,09,198
1,861,935
15,427,731
1,277,192
10,415,521
1,146,011
5,296,931
466,422
168,283
336,566
$17,320,570
$20,000
4,969,507
(24,100,581)
75,479,983
(24,080,581)
97,770,060
($3,000)
17,920,623
412,002,475
22,468
164,093,221
11,371,574
\35,836)
3,488,619
358,464,912
159,525
20,451,891
'
57,327,020
59,800
44,439,279
(40,750)
736,975
15,276,163
(472290)
1,692,571
8,711,241
3,365,658
(551,876)
24,080,581
1,095,503,434
84,206,907
65,806,229
4,071,165
243,532,001
10,899,878
39,171,133
16,704,923
11,520,782
5,291,063
504,849
Total accumulated depreciation 461,007,744 21,253,062 (551,876) 481,708,930
Total capital assets being
depreciated, net 609,205,177 (19,491,254) 24,080,581 613,794,504
Capital assets, net $677,392,935 $34,171,629 $711,564,564
REVIEW DRAFT 12/14/2021 5:40 PM
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Page 54 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 6 — LONG-TERM DEBT
A. Summary of Activity
The changes in the District's long-term obligations during the year ended June 30, 2021 consisted
of the following:
Original
Amount
Issue
Balance
Balance
due within
Amount
June 30, 2020 Additions
Retirements
June 30, 2021
one year
2018 Series A Wastewater Revenue
Refunding Bonds
1.39-2.34%, due 9/l/2029 $15,135,000
$15,135,000
$1,225,000
$13,910,000
$1,270,000
2018 Series B Wastewater Revenue
Refunding Bonds
2.62-3.12%, due 9/l/2023 4,315,000
2,170,000
5 0.00
1,655,000
535,000
2021 Wastewater Revenue Certificates
of Participation
0.05% - 0.62% due 9/l/2028 50,570,000
$50,57
50,570,000
8,645,000
Total long-term debt
17,305,000k670,'6
1,7
66,135,000
$10450000
Add: Unamortized premium
Wastewater Revenue Bonds
2,1423
214,240
9,598,331
Total Long -Term Debt, net
19,447,392
$1,954,240
75,733,331
$10,450,000
Less Current Portion
00
(10,450,000)
Long Term Portion
$ 07,39
$65,283,331
The changes in the District's 1y1
ob11 ons during the year ended June 30,
2020 consisted
of the following:
2018 Series
1.39-2.34%,
2018 Series B Was
Refunding Bonds
2.62-3.12%, due
Total long-term debt
Add: Unamortized premium
Wastewater Revenue Bonds
Total Long -Term Debt, net
Less Current Portion
Long Term Portion
ow Amount
Balance Balance due within
June 30, 2019 Retirements June 30, 2020 one year
$15,135,000 $1,225,000
4,315,000 4,315,000 $2,145,000 2,170,000 $515,000
19,450,000 2,145,000 17,305,000 $1,740,000
2,356,631 214,239 2,142,392
21,806,631 $2,359,239 19,447,392 $1,740,000
(2,145,000) (1,740,000)
$19,661,631 S17,707,392
REVIEW DRAFT 12/14/2021 5:40 PM
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Page 55 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 6 — LONG-TERM DEBT (Continued)
1'0
Debt Service Requirements
The 2018 Wastewater Revenue Refunding debt service requirements are as follows:
Fiscal Year
2018 Wastewater Revenue Refuding
Ending
Series A
Series B
June 30,
Principal
Interest
Principal Interest
2022
$1,270,000
$663,750
$535,000 $42,477
2023
1,335,000
598,625
550,000 26,172
2024
1,395,000
530,375
570,000 8,892
2025
1,465,000
458,875
2026
1,535,000
383,875
2027 - 2031
6,910,000
711,000
Total
$13,910,000
$3,346,500
$1,655,000 $77,541
2018 Series A and B Wastewater Revenue
2021 Wastewater Revenue
Certificates ofParticination
Principal
Interest
$8,645,000
$1,734,832
8,865,000
1,874,625
5,125,000
1,524,875
5,630,000
1,256,000
6,165,000
961,125
16,140,000
998,250
$50,570,000
349,707
On September 13, 2018 the District issued two
The 2018 Wastewater Revenue Refunding R
taxable) were issued for $15,135,000 and $4,3
defease and refund all of the District's tstan
original principal amount of 2009 Wast
all of the District's outstanding obligati W
amount of 2009 Wastewa^ReeCert
the Bonds. The refundinan r
present value of the debt ss is ca
Total
Principal
Interest
$10,450,000
$2,441,059
10,750,000
2,499,422
7,090,000
2,064,142
7,095,000
1,714,875
7,700,000
1,345,000
23,050,000
1,709,250
$66,135,000
$11,773,748
ewater Revenl3Vefunding Bonds (Bonds).
ds, s A (tax-exempt) and B (federally
espectively. The Bonds were issued to
ing gations with respect to the $19,635,000
venue ificates of Participation, Series A and
c to the $34,490,000 original principal
of icipation, Series B, and pay costs issuing
l debt service savings of $7,455,312. The net
an economic gain and amounted to $2,603,897.
The two bonds total 9,4 and are secured by a pledge of tax and net revenues of the
wastewater syste uts ng bonds from direct borrowings related to business -type
activities of $ 0,000 c in ovision that in an event of default, the U.S. Bank National
Association ( e) has the ght to accelerate the total unpaid principal amounts of the bonds.
The official stat t con s an event of default clause that changes the timing of the
repayments of outst ounts to become immediately due if the District is unbale to make
payment. Principal pa is begin annually on September 1, 2020 and 2021 for the Series B and
A Bonds, respectively, with semi-annual interest payments due on September 1 and March 1 of
each year. Yields range from 1.39% to 2.34% and 2.62% to 3.12% for the Series A and Series B
Bonds, respectively. The outstanding balance at June 30, 2021 amounted to $15,565,000.
2021 Wastewater Revenue Certificates of Participation
On June 1, 2021, the District issued new Wastewater Revenue Certificates of Participation. The
2021 Wastewater Revenue Certificates of Participation was issued for $50,570,000. The
Certificates were issued to finance certain improvements to the Wastewater System which is
owned and operated by the District. The repayment of the Certificates will come from the
revenues derived from operation of the Wastewater System, tax revenues, consisting of the ad
valorem property taxes received by the District. The first principal payment is due on March 1,
2022 and then September 1 of each year thereafter. Yield ranges from 0.05% to 0.62% for the
Certificates. The outstanding balance at June 30, 2021 amounted to $50,570,000.
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Page 56 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 7 — RISK MANAGEMENT
The District is exposed to various risks of loss including torts, theft of, damage to, and
destruction of assets, errors and omissions, injuries to employees, and natural disasters. To
manage these risks, the District joined with other entities to form the California Sanitation Risk
Management Authority (CSRMA), a public entity risk pool currently operating as a common risk
management and insurance program for the member entities. The purpose of CSRMA is to
spread the adverse effects of losses among the member entities and to purchase excess insurance
as a group, thereby reducing its cost. Through CSRMA, the District purchases property
insurance and workers' compensation insurance. The District also commenced an Enterprise
Risk Management program during the fiscal year ended June 30, 2020, where the primary risks
facing the agency are identified, monitored and reported on to the Board.
A. Insuran,
The Dist
All -Risk P
Special For
Crime
Liability:
Fiduciary L
Pollution- C
Commercia
Special Exc
Excess Foll
Employmer
Workers'
Excess Wo
B. Provisio
Self Insured
Deductible Per
Occurrence
5,193
$250,000
0,000
2,500
0,000
-
i0,000
5,000 - 50,000
0,000
5,000 - 50,000
0,000
50,0000
0,000
10,000,000
0,000
30,000
ttutory
The Governmental AccWhting Standard Board (GASB) requires state and local governments to
record their liability for uninsured claims in their financial statements. The District's policy is to
maintain a reserve for claims of $1,500,000 which is equivalent to three claims at $500,000 per
occurrence. The District's actuary has calculated its potential liability as of June 30, 2021 to be
$1,455,065.
The District's uninsured claims activity and exposure relates primarily to its general and
automobile liability program. The District records its estimated liability for uninsured claims in
this area based on the results of periodic actuarial evaluations. The actuarial evaluations are
typically performed every two years latest report was dated December 23, 2020. For intervening
years, the liability for uninsured claims is reviewed for adequacy based on claims activity during
the intervening period.
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Page 57 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 7 — RISK MANAGEMENT (Continued)
For fiscal years ended June 30, 2021, 2020, and 2019, settlements have not exceeded insurance
coverage. Changes in the District's estimated liability for retained losses are summarized as
follows as of June 30:
2021 2020 2019
Beginning balance $1,221,293
Provisions for claims incurred in the current year
and changes in the liability for retained -
losses incurred in prior years
Claims paid and/or adjustments
Ending balance
596,645
$1,4
62
I NOTE 8 — AGREEMENT WITH THE CITY OF CONC/hD I
In 1974, the District and the City of Concord
under which the District became responsible
services to the City. Under this agre t
operating, maintenance and administra e
facilities capital costs expended. Service r
totaled $15,002,567 and $10,0 espe
$25,066,772. Service char nd c 'buti
and $11,393,000 respecti for
NOTE 9 — PENSION
$1,157,797 $882,230
257,075 275,567
(193,579)
$1,221,293 $1,157,797
N
ntered into a cost -sharing agreement
ing sewage treatment facilities and
s a service charge for its share of
entered
a contribution for its share of
a ntributions to capital costs from the City
ly, for the year ended June 30, 2021, for a total of
to capital costs from the City totaled $14,923,591
June 30, 2020, for a total of $26,316,591.
A. Contra Costa Mate EmnloWs' Retirement Association Pension Plan
Plan Descriptions —791F&sWially all District permanent employees are required to participate in
the Contra Costa Coun mployees' Retirement Association (CCCERA), a cost -sharing multiple
employer public defined benefit retirement plan (Plan), governed by the County Employee's
Retirement Law of 1937, as amended, and the California Public Employees' Pension Reform Act
of 2013 (PEPRA). The latest available actuarial and financial information for the Plan is for the
year ended December 31, 2020. CCCERA issues a publicly available financial report that
includes financial statements and supplemental information of the Plan. That report is available
by writing to Contra Costa County Employees' Retirement Association, 1200 Concord Ave.,
Suite 300, Concord, CA 94523 or on their website at www.cccera.org.
Benefits Provided — The Plan provides for retirement, disability, and death and survivor benefits.
Annual cost of living (COL) adjustments to retirement allowances can be granted by the
Retirement Board as provided by State statutes. Retirement benefits are based on age, length of
service, date of membership and final average salary.
Subject to vested status, employees can withdraw contributions plus interests credited, or leave
them as a deferred retirement when they terminate, or transfer to a reciprocal retirement system.
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Page 58 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 9 — PENSION PLANS (Continued)
The Plans' provisions and benefits in effect at June 30, 2021, are summarized as follows:
Membership date
Benefit vesting schedule
Benefit payments
Leave cash out pensionable?
Benefit % per year of service
Final pensionable salary formula
Annual benefit cap
Minimum Retirement age (with benefit reductions)
Required employee contribution rates
Required employer contribution rates
Contributions — The Plan requires employees
a portion of future COL costs. For the year i
the Plan were $17,968,524. Ah.-
Pension Liabilities, Pension Expenses
Pensions - The District reported��e
pension liability of the Plan JIM%
Mis
Total Net
Miscellaneous
Prior to January 1, 2013
On or after January 1, 2013
10years service
5years service
monthly for life
monthly for life
Yes
No
2%
2%
Highest 12 consecutive
Annual average of highest
months
36 consecutive months
Hired before 1/1/1996-None
$153,671
Hired 1/1/1996- 12/31[2012-
8.
a
52
11.06%
45.87%
retirement benefit and
2021, the District's contributions to
�fflows/Inflows of Resources Related to
lities or its proportionate share of the net
30:
portionate Share of Net Pension Liability
2021 2020
$48,886,895
$64,117,450
$64,117,450
The District's net pensioTi liability for the Plan is measured as the proportionate share of the net
pension liability. The net pension liability of the Plan is measured as of December 31, 2020, and
the total pension liability for the Plan used to calculate the net pension liability was determined by
an actuarial valuation as of December 31, 2019 rolled forward to December 31, 2020 using
standard update procedures. The District's proportion of the net pension liability was based on a
projection of the District's long-term share of contributions to the pension plan relative to the
projected contributions of all participating employers, actuarially determined.
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December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 156 of 220
Page 59 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 9 — PENSION PLANS (Continued)
The District's proportionate share of the net pension liability for the Plan as of December 31,
2019, 2020, and 2021 were as follows:
Reporting Date for
Employer under GASB 68
as of June 30
2019
2020
2021
Proportionate share of the
Plan Fiduciary Net
Proportion of the
Net Pension Liability as a
Pension as a
Net Pension
Proportionate share of
Covered
percentage of its covered
percentage of the Total
Liability
Net Pension Liability
Payroll
payroll
Pension Liability
6.332%
$90,430,104
$33,793,159
267.60%
77.86%
7.420%
64,117,450
36,087,017
177.67%
85.05%
10.594%
48,886,895
37,131,965
131.66%
89.10%
For the year ended June 30, 2021, the District recognized pension expense of $13,284,517. At
June 30, 2021, the District reported deferred outflows of r�Qurces and deferred inflows of
resources related to pensions from the following sources:
Pension contributions subsequent to measurement
Differences between expected and actual experience
Changes of assumptions or other inputs
Change in proportion and differences bet
contributions and proportionate share of triby
Net difference between
on pension plan inv(
Total
The $9,152,71
the measureml
ended June 30,
Deferred Inflows
of Resources
($1,240,201)
(4,869,641)
(6,746,064)
(35,244,529)
$95,805,386 ($48,100,435)
ows of resources related to contributions subsequent to
as a reduction of the net pension liability in the year
Other amounts report deferred outflows of resources and deferred inflows of resources
related to pensions will be recognized as pension expense as follows:
Year Ended
Annual
June 30
Amortization
2022
($8,617,706)
2023
2,397,163
2024
(13,194,117)
2025
(3,824,807)
Total
($23,239,467)
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December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 157 of 220
Page 60 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 9 — PENSION PLANS (Continued)
At June 30, 2020, the District reported deferred outflows of resources and deferred inflows of
resources related to pensions from the following sources:
Pension contributions subsequent to measurement date
Differences between expected and actual experience
Changes of assumptions or other inputs
Change in proportion and differences between employer
contributions and proportionate share of contributions
Net difference between projected and actual earnings
on pension plan investments
Total
Actuarial Assumptions — The total pension
valuations were determined using the following
Valuation Date
Measurement Date
Actuarial Cost Method
Amortization Method
Actuarial Assumptions:
Discount Rate
Inflation Rate
Payroll Gro)m�
Cost o14
Investme.
Mortality
Deferred Outflows
of Resources
$8,971,970
9,160,932
Miscellaneous
Deferred Inflows
of Resources
($956,369)
(3,889,681)
(11,042,919)
(14,872,898)
($30,761,867)
31, 2020 actuarial
December 31, 2018
December 31, 2020
Entry Age Actuarial Cost Method
Level percent ofpayroll
7.00%
2.75%
2.75% (1)
3.75% - 15.25%
2.75%
7.00%
Pub-2010 General Healthy Retiree Amount -Weighted
Above -Median Mortality Table
(1) Plus "across the board" real salary increases of 0.5% per year
Discount Rate — The discount rate used to measure the Total Pension Liability (TPL) was 7.00%
as of December 31, 2020 and December 31, 2019. The projection of cash flows used to determine
the discount rate assumed employer and employee contributions will be made at rates equal to the
actuarially determined contribution rates. For this purpose, only employer and employee
contributions that are intended to fund benefits for current plan members and their beneficiaries
are included. Projected employer contributions that are intended to fund the service costs for
future plan members and their beneficiaries, as well as projected contributions from future plan
members, are not included. Based on those assumptions, the Plan Fiduciary Net Position was
projected to be available to make all projected future benefit payments for current plan members.
Therefore, the long-term expected rate of return on pension plan investments was applied to all
periods of projected benefit payments to determine the TPL as of both December 31, 2020 and
December 31, 2019.
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Page 61 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 9 — PENSION PLANS (Continued)
The long-term expected rate of return on pension plan investments was determined in 2021 using
a building-block method in which expected future real rates of return (expected returns, net of
inflation) are developed for each major asset class. The target allocation and projected arithmetic
real rates of return for each major asset class, after deducting inflation, but before investment
expenses, used in the derivation of the long-term expected investment rate of return assumption
are summarized in the following table:
Long -Term
Expected Real
Target Rate of
Asset Class Allocation Return
Large Cap U.S. Equity
Developed International Equity
Emerging Markets Equity
Short -Term Govt/Credit
U.S. Treasury
Private Equity
Risk Diversifying
Global Infrastructure
Private Credit
REIT
Value Add Real Eiimi&
5.44%
6.54%
8.73%
3.53%
7.90%
5.80%
6.80%
8.80%
12.00%
5.80%
A change in th scount ra oulWffect the measurement of the Total Pension Liability (TPL).
A lower disco ate results a higher TPL and higher discount rates results in a lower TPL.
Because the disco\sh
do of affect the measurement of assets, the percentage change in the
Net Pension Liabian be very significant for a relatively small change in the discount
rate. The table bels the sensitivity of the NPL to a one percent decrease and a one percent
increase in the discount rate:
1VTiccallananns
1% Decrease 6.00%
Net Pension Liability $108,606,076
Current Discount Rate 7.00%
Net Pension Liability $48,886,895
1% Increase 8.00%
Net Pension Liability ($34,625)
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December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 159 of 220
Page 62 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 9 — PENSION PLANS (Continued)
B. 457 (b) Deferred Compensation Plan
District employees may defer a portion of their compensation under a District sponsored Deferred
Compensation Plan created in accordance with Internal Revenue Code Section 457 (b). The plan
was established by the District's Board of Directors and any amendments to the plan must be
authorized by the Board of Directors. Under this plan, participants are not taxed on the deferred
portion of their compensation until it is distributed to them; distributions may be made only at
termination, retirement, death, or in an emergency as defined by the plan. The District does not
make contributions to the plan.
The plan's 457 (b) assets are held in trust with Mission Square Retirement (formerly ICMA-RC)
for the exclusive benefit of the participants and are not inided in the District's financial
statements.
C. 401 (a) Defined Contribution Plan
The District also contributes to a money pw
Revenue Code section 401(a). The plan was es"
any amendments to the plan must be authorized
in accordance with a memorandum of rst,
Social Security, the District contributes
have been contributed to Social Security be
required to participate in Socia ity.
the Plan during the years en un , 20
�e pla created lWccordance with Internal
she the District's Board of Directors and
oard. Contributions to the plan are made
in ting that in lieu of making payments to
La)
n amount equal to that which would
employees as long as the District is not
tract contributed $2,795,431 and $2,222,449 to
2020, respectively.
The 401(a) money purc held in trust with Mission Square Retirement
(formerly ICMA-R th lusive benefit of the participants and are not included in the
District's financi e
NOTE 10 — POST EMPWYMENTWEALTH CARE BENEFITS
A. General Information the District's Other Post Employment Benefit (OPEB) Plan
Plan Description — The District's defined benefit post employment healthcare plan (DPHP)
provides medical benefits to eligible retired District employees and beneficiaries. DPHP is part of
the Public Agency portion of the Public Agency Retirement System (PARS), an agent multiple -
employer plan through PARS, which acts as a common investment agent for participating public
employees within the State of California. The District is the plan administrator. A menu of
benefit provisions as well as other requirements is established by the State statute with the Public
Employees' Retirement Law. DPHP selects optional benefit provisions from the benefit menu by
contract with PARS and adopts those benefits through District resolution. PARS issues a separate
Comprehensive Annual Financial Report. Copies of the PARS annual financial report may be
obtained from PARS, 4350 Von Karman Ave., Suite 100, Newport Beach, CA 92660, by calling
1(800) 540-6369, or by emailing info@pars.org.
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December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 160 of 220
Page 63 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 10 — POST EMPLOYMENT HEALTH CARE BENEFITS (Continued)
B.
Benefit Terms — Post -employment healthcare and similar benefit allowances are provided to
eligible employees who retire from the District or to their surviving spouses.
Employees Covered by Benefit Terms — Membership in the plan consisted of the following at the
measurement date of June 30, 2021:
Active employees 272
Inactive employees or beneficiaries currently
receiving benefit payments 261
Inactive employees entitled to but not yet
receiving benefit payments
Total
Net OPEB Liability
Actuarial Methods and Assumptions — The
30, 2021 and the total OPEB liability used to
actuarial valuation dated July 1, 2020 tha w
determine the $85,326,987 total OPE
actuarial methods and assumptions:
Valuation Date
Measurement Date
Actuarial Cost Method
Actuarial As sumptions:
Contribution and Fw
Investments ,
Discount Rate
General Inflation
Mortality, Disability, T¢
Retirement
Mortality Improvement
Medical Trend
Dental Trend
Healthcare Participation
for future Retirees
EB liability was measured as of June
OPEB liability was determined by an
using standard update procedures to
30, 2021, based on the following
District contributes full ADC less benefit payments to PARS trust
1efits payments paid outside the trust
RS portfolio: Moderate
5.75% at June 30, 2020
5.50°/u at June 30, 2021
2.75% Annually
CCCERA 2015-17 Experience Study
Mortality improvement projected generationally with Scale MP-2018
Non -Medicare - 7% for 2022, decreasing to an ultimate rate of 4°/u in 2076
Medicare (Non -Kaiser) - 6.1% for 2022, decreasing to an ultimate rate of 4°/u in 2076
Medicare (Kaiser) - 5% for 2022, decreasing to an ultimate rate of4% in 2076
3.75% annually
Currently Covered: 100%
Currently Waived Coverage: 95%
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December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 161 of 220
Page 64 of 104
Discount Rate — The disc
projection of cash flows u�
be made at rates equal to th
the OPEB plan's fid
payments for cu a
expected rate turn on
payments to
the
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 10 — POST EMPLOYMENT HEALTH CARE BENEFITS (Continued)
The underlying mortality assumptions were based on the mortality improvement projected
generationally with Scale MP-15 and all other actuarial assumptions used in the July 1, 2020
valuation were based on the results of a July 1, 2020 actuarial experience study for the period of
July 1, 2020 to June 30, 2021.
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. 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
Taxpected Real
Asset Class Component Allorge n e of Return
Global Equity 50. 4.56%
Fixed Income % 0.78%
Cash 0% -0.50%
Total 100.
rat sed t easure the total OPEB liability was 5.50%. The
det me the count rate assumed that District contributions will
i ned contribution rates. Based on those assumptions,
ition was projected to be available to make all projected OPEB
ctive employees and beneficiaries. Therefore, the long-term
3 p investments was applied to all periods of projected benefit
OPEB liability.
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Page 65 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 10 — POST EMPLOYMENT HEALTH CARE BENEFITS (Continued)
C. Changes in Net OPEB Liability
The changes in the net OPEB liability follows:
Balance at June 30, 2020
Changes Recognized for the Measurement Period:
Adjustment to beginning balance*
Service Cost
Interest on the total OPEB liability
Changes in benefit terns
Differences between expected and actual experience
Changes of assumptions
Contributions from the employer
Contributions from the employee
Net investment income
Benefit payments
Administrative expenses
Net changes It
Balance at June 30, 2021
*Adjustment to reconcile prior year Fiduciaiyj�tion and
Increase (Decrease)
Total OPEB Plan Fiduciary Net OPEB
Liability Net Position Liability/(Asset)
(a) (b) (a) - (b)
$80,359,688 $69,988,180 $10,371,508
(138,800) 138,800
2,249,861 2,249,861
4,616,234,616,239
asset statements
3,219,980
(464,535)
(4,654,246)
14,958,207
(14,958,207)
(4,654,246)
(200,304)
200,304
14,619,103
(9,651,804)
$84,607,283
$719,704
D. Sensitivity of the Net O Lia Clipiges in the Discount Rate and Healthcare Cost
Trend Rates
The following p is th O liability of the District at June 30, 2021, as well as what the
District's net B liabili oul be if it were calculated using a discount rate that is 1-
percentage-poin er (4.50° r 1-percentage-point higher (6.50%) than the current discount rate:
Net OPEB Liability/(Asset)
Discount Rate -1%
(4.50 %)
$12,453,533
Discount Rate
(5.50%)
$719,704
Discount Rate +1%
(6.50%)
($8,837,363)
The following presents the net OPEB liability of the District, as well as what the District's net
OPEB liability would be if it were calculated using healthcare cost trend rates that are 1-percentage-
point lower or 1-percentage-point higher than the current healthcare cost trend rates:
Net OPEB Liability/(Asset)
Current Healthcare Cost
1% Decrease Trend Rates 1% Increase
($9,880,589) $719,704 $13,887,732
REVIEW DRAFT 12/15/2021 4:27 PM
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Page 66 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 10 — POST EMPLOYMENT HEALTH CARE BENEFITS (Continued)
E. OPEB Expense and Deferred OutflowsJnflows of Resources Related to OPEB
F.
For the year ended June 30, 2021, the District recognized negative OPEB expense of $747,472. At
June 30, 2021, the District reported deferred outflows and inflows of resources related to OPEB
from the following sources:
Differences between actual and expected experience
Changes of assumptions
Net differences between projected and actual earnings on
plan investments
Total
Amounts reported as deferred outflows and
recognized as part of OPEB expense as follows:
Deferred Outflows Deferred Inflows
of Resources of Resources
$2,600,753
1,516,977
($3,188,293)
(375,201)
(8,724,275)
($12,287,769)
related to OPEB will be
OPEB Liabilities, VB enses and Deferred OutflowsJnflows of Resources Related to
OPEB — For purposeasuring 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 District's OPEB Plan and additions to/deductions from the OPEB
Plan's fiduciary net position have been determined on the same basis as they are reported by the
District's defined benefit post employment healthcare plan (DPHP). For this purpose, benefit
payments are recognized when currently due and payable in accordance with the benefit terms.
Investments are reported at fair value.
Annual Money -Weighted Rate of Return on Investments
For the years ended June 30, 2021 and 2020, the annual money -weighted rate of return on
investments, net of investment expense, were 17.44% and 4.49%. The money -weighted rate of
return expresses investment performance net of investment expense, adjusted for the changing
amounts actually invested.
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Page 67 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 10 — POST EMPLOYMENT HEALTH CARE BENEFITS (Continued)
G. Disclosure of the Other Post -Employment Benefit Plan Trust Fiduciary Fund
The District implemented the provisions of Governmental Accounting Standards Board Statement
No. 84 — Fiduciary Activities during the year ended June 30, 2021. As a result, the District
determined that the Other Post -Employment Benefits Trust Fund fiduciary activities should no
longer be reported as a Fiduciary Fund, since the District does not have control of the assets of the
Public Agencies Post -Retirement Healthcare Plan as a whole. Therefore the Other Post -
Employment Benefits Trust Fund is no longer reported in the financial statements as a fiduciary
fund as of July 1, 2020.
NOTE 11—NET POSITION
Net Position
Net Position is the excess of all the District's assets a Te ferre flows of resources over all its
liabilities and deferred inflows of resources, regar of fund. NINition is divided into three
captions:
Net Investment in Capital Assets describes the p of Net Position which is represented by
the current net book value of the Distri ital ass ess the outstanding balance of any debt
issued to finance these assets.
Restricted describes the pc
conditions of agreements
restrictions which the DisA
Unrestricted
NOTE 12 — LEASE
The District leases
summary of operating
et P n which is restricted as to use by the terms and
�ide Vies, governmental regulations, laws, or other
uulater alter.
et Position which is not restricted as to use.
Facilities and equipment under operating leases. Following is a
commitments as of June 30:
Fiscal Year
Ending June 30,
2021
Total
Facilities
Total
$332,642 $332,642
$332,642 $332,642
Total rental expense for both the fiscal years ended June 30, 2021 and 2020 was $332,642 and
$320,342, respectively.
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December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 165 of 220
Page 68 of 104
CENTRAL CONTRA COSTA SANITARY DISTRICT Attac men
NOTES TO THE BASIC FINANCIAL STATEMENTS
For the Years Ended June 30, 2021 and 2020
NOTE 13 — COMMITMENTS AND CONTINGENCIES
Commitments and contingencies, undeterminable in amount, include normal recurring pending
claims and litigation. In the opinion of management, based upon discussion with legal counsel,
there is no pending litigation which is likely to have a material adverse effect on the financial
position of the District.
Claims and losses are recorded when they are reasonably probable of being incurred and the
amount is estimable. Insurance proceeds and settlements are recorded when received.
The District has a number of purchase commitments for ongoing operating and capital projects
that involve multi -year contracts. Purchase commitments related to these multi -year contracts are
approximately $59,973,759 and $49,817,490 as of June 30, 2021 and 2020, respectively.
NOTE 14 — SUBSEQUENT EVENTS
Increase to Self Insurance Reserve
On December 2, 2021 the District's Board app
017), increasing the Catastrophic Loss Emerge
million to 7.5 million. The intent of this increase
driven by inflation since the reserve v4@hJ&t ii
increase is available reserves in the Dis
Approval of State Revolving
ons to itsTiscal Reserves Policy (BP
of the Self Insurance Fund from $5.0
.ure projected increases in future losses
in 2015. The funding source for this
Won Fund Reserve Account.
On December 9, 2021, thaistrict' icat for a state revolving fund loan in the amount of
$173.1 million was authon b is State Water Resources Control Board. The loan
is a critical fina . le in the District's long-term Capital Improvement Budget,
specifically for t rge ds dling Facilities Improvement Project". The December 2021
approved loa 1 finance rei ursement of approximately $15.0 million in planning and
design costs of roject. loan has a 30 year term, maturing on July 31, 2055, with a fixed
interest rate of 0. D service payments are set to commence one-year following the
completion of cons tru nticipated in the fiscal year ending June 30, 2025.
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Page 69 of 104
Attachment 1
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Page 70 of 104
Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
Cost -Sharing Multiple Employer Defined Benefit Retirement Plan
As of fiscal year ending June 30, 2021
PROPORTIONATE SHARE OF NET PENSION LIABILITY
Last 10 Fiscal Years'
December 31,
Measurement date 2020 2019 2018 2017 2016 2015 2014
Proportion of the net pension
liability
10.59%
7.42%
Proportionate share of the net
pension liability
$48,886,895
$64,117,450
Covered Payrolf
$37,131,965
$36,087,019
Proportionate share of the net
pension liability as a percentage
of covered payroll
131.66%
177.67%
Fiduciary net position as a
percentage of the total pension
liability
89.100/0
85.05%
6.33%
7.86% 6.27%
6.09%
7.49%
$90,430,104
$63,806,000 $87,947,116
$91,746,888
$89,535,510
$33,793,159
$33,306,738 $31,584,169
$29,061,743
$29,647,993
267.60%
191.57% . 278.14%
315.70%
302.00%
The fiscal year ending June 30, 2015 was the first year of implementation.
2 Covered payroll represents compensation earnable and pensionable J&
eamable and pensionable compensation that would possibly go into the
74.14% 73.86%
period ended December 31st. Only compensation
is are included.
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Page 71 of 104
Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
Cost -Sharing Multiple Employer Defined Benefit Retirement Plan
As of fiscal year ending June 30, 2021
SCHEDULE OF CONTRIBUTIONS
Last 10 Years*
2021 2020 2019 2018 2017 2016 2015
Actuarially determined contribution $ 18,319,277 $ 18,046,778 $ 17,520,615 $ 17,880,152 $ 18,043,391 $ 22,752,611 $ 24,451,234
Contributions in relation to the actuarially determined
contributions 18,319,277 18,046,778 17,520,615 17,880,152 18,043,391 22,752,611 24,451,234
Contribution deficiency (excess) - - - - - - -
Covered payroll $ 41,625,151 $ 40,356,579 $ 38,479,260 $ 36,638,935 $ 35,178,106 $ 32,675,243 $ 30,093,339
Contributions as apercentage ofcovered-employee
payroll 44.01% 44.72%
Notes to Schedule
Measurement Date:
Methods and assumptions used to c
Actuarial cost method
Amortization method
Remaining amortization period
Asset valuation method
Inflation
Salary increases
Investment rate of return
Retirement age
Mortality
* Fiscal year 2015 was the 1st year o
** Remaining balance of December:
as of December 31, 2017. Any chang
December 31, 2013, any changes in
period effective with that valuation.
45.53% 48.80% 51.29% 69.63% 81.25°%
if December 31, 2018 and 5 years remaining
:tive with that valuation. Effective
t be amortized over a 10-year fixed
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Page 72 of 104
Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
POST -RETIREMENT HEALTH CARE DEFINED BENEFIT PLAN
SCHEDULE OF CHANGES IN THE NET OPEB LIABILITY AND RELATED RATIOS
Single Employer
Last 10 fiscal years*
Me as urement Date
Total OPEB Liability
Service Cost
Interest
Changes in benefit terms
Differences between expected and actual experience
Changes of assumptions
Benefit payments
Net change in total OPEB liability
Total OPEB liability -beginning
Total OPEB liability - ending (a)
Plan fiduciary net position
Contributions - employer
Contributions - employee
Adjustment to Beginning Balance
Net investment income
Administrative expense
Benefit payments
Net change in plan fiduciary net position
Plan fiduciary net position - beginning
Plan fiduciary net position - ending (b)
Net OPEB liability - ending (a)-(b)
Plan fiduciary net position as a percentage of the total OPEB liability
Covered payroll OR
Net OPEB liability as a percentage of covered -employ oll
Notes to schedule: I
Annual money weighted rate of return,
net of investment expense
June 30, 2021
June 30, 2020
June 30, 2019
June 30, 2018
$2,249,861
$2,184,331
$2,447,310
$2,370,276
4,616,239
4,482,146
6,596,612
6,396,063
(27,603,524)
3,219,980
(7,346,935)
(464,535)
3,495,645
(4,654246)
(4,145,654)
(5,697,440)
(5,571,750)
4,967,299
2,520,823
(28,108,332)
3,194,589
80,359,688
77,838,865
105,947,197
102,752,608
$85,326,987
$80,359,688
$77,838,865
$105,947,197
$4,654246
' $5,395,654
$7,280,240
$9,649,750
2,994,909
4,920,923
3,354,822
82,833)
(174,362)
(164,446)
54
(5,697,440)
(5,571,750)
4,061W6
6,329,361
7,268,376
65,926,104
59,596,743
52,328,367
$69,988,180
$65,926,104
$59,596,743
$10,371,508 $11,912,761 $46,350,454
87.09% 84.70% 56.25%
$41,625,151 $40,356,579 $38,479.260 $36,638,935
1.73% 25.70% 30.96% 126.51%
,NTRA COSTA SANITARY DISTRICT
'HEALTH CARE DEFINED BENEFIT PLAN
OF INVESTMENT RETURN RATE
2021 2020 2019
17.44% 4.49% 7.20%
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December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 170 of 220
Page 73 of 104
Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
POST -RETIREMENT HEALTH CARE DEFINED BENEFIT PLAN
SCHEDULE OF CONTRIBUTIONS
Single Employer
Last 10 fiscal years*
Fiscal Year Ended June 30,
2021
2020
2019
2018
2017
Actuarially determined contribution
$3,917,000
$3,906,000
$7,524,000
$7,866,000
$7,866,000
Contributions in relation to the
actuarially determined contribution
4,654,246
5,395,654
7280,240
10,433,327
$10,433,327
Contnbution deficiency (excess)
($737,246)
($1,489,654)
$243,760
($2,567,32D
($2,567,32D
Covered payroll
$41,625,151
$40,356,579
$38,479,260
$36,638,935
$35,178,106
Contnbutions as a percentage of
covered payroll
11.18%
13.37%
18.92%
28.48%
29.66%
Notes to Schedule
Methods and assumotions used
Valuation Date
Actuarial Cost Method:
Amortization Method:
Asset Valuation Method
Actuarial Assumptions:
Discount Rate
General Inflation
Medical Trend
Dental Trend
Mortality Rate
Mortality Improvement
4% in 2076
ate rate of 4% in 2076
of 4% in 2076
2018
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Page 74 of 104
Attachment 1
SUPPLEMENTARY INFORMATION
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Page 75 of 104
Attachment 1
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
Short term investments
Accounts receivable
Employee computer loans receivable
Interest receivable
Due from other funds
Parts and supplies
Prepaid expenses
Total current assets
NON -CURRENT ASSETS:
Restricted cash and equivalents
Assessment Districts receivable
CAPITAL ASSETS
Nondepreciable
Depreciable, net of accumulated depreciation
Total capital assets, net
Total non -current assets
TOTAL ASSETS
DEFERRED OUTFLOWS OF RESOURCES
Pension related
OPEB related
Total deferred outflows
LIABILITIES
CURRENT LIABILITIES:
Accounts payable and accrued expenses
Interest payable
Current portion of long -tern obligations
Accrued compensated absences - current portion
Liability for uninsured claims
Refundable deposits
Due to other funds
Total current liabilities
NON -CURRENT LIABILITIES:
Non -current portion of long-term obligations
Accrued compensated absences, noncurrent po
Net pension liability
Net OPEB liability
Total noncurrent liabilities
TOTAL LIABILITIES
DEFERRED INFLOWS OF RESOURCES
Pension related
OPEB related
Total deferred inflows
NET POSITION
Net investment in capital assets
Restricted for debt service
Unrestricted
TOTAL NET POSITION
CENTRAL CONTRA COSTA SANITARY DISTRICT
COMBINING SCHEDULE OF NET POSITION
ENTERPRISE SUB -FUNDS
JUNE 30, 2021
Running Sewer Self Debt
Expense Construction Insurance Service
$18,371,736
$30,283,225
$372,131
21,100,000
26,000,000
7,600,000
16,880,754
10,128,708
10,684
14,994
16,283
6,495
5,906
35,008,465
3,086,194
2,520,035
61,990,303
101,436,681
7,978,626
147,121
$34,929,105
1,496,010
128,635,569
631,932,004
760,567,573
760,714,694 1,496,010 34,929,105
822,704,997 102,932,691 7,978,62 34,929,105
95,805,386
4,117,730
99,923,116
Elimination Total
$49,027,092
54,700,000
27,009,462
10,684
37,772
35,014,371
3,086,194
2,520,035
171,405,610
35,076,226
1,496,010
128,635,569
631.932.004
760,567,573
797,139,809
968,545,419
95,805,386
4,117,730
99,923,116
5,351,973rl�W701708
15,161,757
248,632
248,632
10,450,000
10,450,000
00509,400
1,455,065
1,455,065
180
277,257
5 00 5
35,014,371
841,897 1,525,773
10,698,632
63,116,482
65,283,331
65,283,331
92
4,584,692
8,8 5
48,886,895
719,704
719,704
4,191,291
65,283,331
119,474,622
5,241,471 9,841,897 1,525,773
75,981,963
182,591,104
48,100,435
12,287,769
60,388,204
48,100,435
12,287,769
60,388,204
760,567,573 (75,733,331) 684,834,242
34,929,105 34,929,105
6,430,865 93,090,794 6,452,853 (248,632) 105,725,880
$766,998,438 $93,090794 $6,452,853 ($41,052,858) $825,489,227
52
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 173 of 220
Page 76 of 104
Attachment 1
CENTRAL CONTRA COSTA SANITARY DISTRICT
COMBINING SCHEDULE OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION
ENTERPRISE SUB -FUNDS
FOR THE YEAR ENDING JUNE 30, 2021
OPERATING REVENUES
Sewer service charges (SSC)
Service charges - City of Concord
Other services charges
Miscellaneous charges
Total operating revenues
OPERATING EXPENSES
Sewage collection and pumping stations
Sewage treatment
Engineering
Recycled water
Administrative and general
Pension expense
OPEB expense
Depreciation
Total operating expenses
OPERATING INCOME (LOSS)
NONOPERATING REVENUES (EXPENSES)
Taxes
Permit and inspection fees
Interest earnings
Interest expense
Other income (expense), net
Total nonoperating revenues
NET INCOME (LOSS) BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS
CAPITAL CONTRIBUTIONS AND TRANSFERS
City of Concord contributions to capital costs
Customer contributions to capital cost (SSC)
Contributed sewer lines
Capital contributions - connection fees
Transfers In (Out)
Total capital contributions and transfers
CHANGE IN NET POSITION 14
NET POSITION, BEGINNING OF YEAR
NET POSITION, END OF YEAR
Running Sewer Self
Expense Construction Insurance
Debt
Service Elimination Total
$72,325,340
$72,325,340
15,002,567
15,002,567
1,171,378
1,171,378
743,276
743,276
89,242,561
89,242,561
18,183,752
18,183,752
24,783,779
24,783,779
15,278,784
15,278,784
2,037,788
2,037,788
93,755,104
$808,269 94,563,373
(67,027,225)
(67,027,225)
(3,906,774)
(3,906,774)
21,531,302
21,531,302
104,636,510
808,269 105,444,779
(15,393,949)
(808,269) (16,202,218)
2826
�$2,511,211
,440,187
2,440,187
11,194
1,678,028
(542,226)
(542,226)
(240,179) 808,269
3,193,569
1,740,000 808,269
27,286,384
1,740,000
11,084,166
10,064,155
30,156,394
923,468
5,500,316
-W111QW06,369)
745,419
(23,078,333)
(1,185,504)
745,419
(23,078,333)
46,644,333
17,359,003
(21,047)
(21,338,333)
57,728,499
75,731,791
6,473,900
(19,714,525)
767,760,728
$93,090,794
$6,452,853
($41,052,858)
$825,489,227
53
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 174 of 220
NNUAL C.OMPREHENSIV
TATISTI
Attachment 1
Central Contra Costa Sanitary District
Changes in Net Position and Statement of Net Position
Last Ten Fiscal Years
Changes in Net Position
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
Operating Revenues:
Sewer Service Charges (SSC)
$49,123,848
$56,770,984
$60,796,421
$70,023,512
$72,233,903
City of Concord
10,647,389
10,483,421
11,625,864
12,892,945
13,913,960
Other Service Charges
915,485
1,076,401
1,035,134
1,006,197
963,01
Miscellaneous Charges
929,917
751,880
544,589
593,780
623
Total Operating Revenue
61,616,639
69,082,686
74,002,008
84,516,434
87,7
2016-2017 2017-2018 2018-2019 2019-2020 2020-2021
'13,138,235 $75,824,221 $68,656,908 $70,408,903 $72,325,340
13,851,253 14,973,623 15,205,292 14,923,591 15,002,567
1,029,500 1,078,594 1,126,239 1,176,242 1,171,378
606,453 619,997 689,727 714,043 743,276
,625,441 92,496,435 85,678,166 87,222,779 89,242,561
Operating Expenses:
Salaries & Benefits
45,562,430
49,811,218
58,954,452
66,104,630
88,158
6 2
68,862,484
65,071,382
62,672,096
134,187,829
Chemicals, Utilities & Supplies
8,121,809
7,401,103
8,063,309
7:466,490
7:304:619
8,1
7,477,602
8,093,144
8,088,750
8,738,404
Professional & Outside Services
4,099,876
2,836,638
3,995,860
3,322,881
3,891,
2,988,280
3,276,763
2,684,034
4,160,807
Hauling, Disposal, Repairs & Maintenance
4,077,741
4,239,421
4,041,355
4,758,26
5,662,086
5,461,011
5,755,590
5,435,406
5,751,355
Self -Insurance (net of transfers)
(65,688)
159,961
214,290
496,381
(300,108)
(332,483)
1,039,444
1,110,798
550,000
Pension/OPEB Expense
-
-
-
(3,012,757)
e4,196,3
(4,080,558)
1,104,358
(33,307,168)
(2,386,849)
(70,933,999)
Depreciation
21,190,059
21,596,266
21,892,545
22:740,942
22,892,153
21,561,704
20,983,353
21,253,062
21,531,302
All Other
2,489,019
2,693,135
2,346,583
473,963
2,942,592
2,558,122
2,366,416
1,858,144
1,459,081
Total Operating Expenses
85,475,246
88,737,742
99,508,394
0
9 17
101,464,785
109,681,078
73,278,924
100,715,441
105,444,779
Operating Loss
(23,858,607)
(19,655,056)
(25,506,386)
34,
10,05
(12,839,344)
(17,184,643)
12,399,242
(13,492,662)
(16,202,218)
Non -Operating Revenues (Expenses):
Property Taxes
12,047,169
13,010,477
13,093
1
14, 5,167
16,318,874
17,650,741
18,251,794
18,876,886
20,516,826
Connection & Other Fees
903,810
1,169,809
1
1,
2,546,723
2,600,888
2,592,137
2,648,708
2,251,245
2,440,187
Interest Income
294,938
405,474
,28
3 5
562,308
761,838
1,223,349
2,573,964
2,310,269
1,678,028
Interest Expense
(1,919,375)
(1,802,084)
,996,689)
(1,52 )
(1,427,641)
(1,313,398)
(1,230,680)
(1,025,006)
(604,851)
(542,226)
All Other'
931,660
951,100
9------
1,828,
1,195,095
966,244
1,075,838
1,424,520
1,219,811
3,193,569
Total Non -Operating
12,258,202
13,734,776
13,964,1
1,1
17,711,652
19,334,446
21,311,385
23,873,980
24,053,360
27,286,384
Income Before Contributions and Transfers
(11,600,405)
(5,920,280)
)
,205)
7,653,671
6,495,102
4,126,742
36,273,222
10,560,698
11,084,166
Customer Contributions*
8,888,663
8,
1 67
6,769,623
11,991,752
16,628,105
20,425,514
36,562,141
44,222,958
40,220,549
Contributed Sewer Lines
792,011
1,4
794,218
1,774,168
2,899,042
2,003,614
2,179,641
1,761,808
923,468
Capital Contributions - ConnectionFees
5,724,833
91,529
8,224,
6,673,298
8,543,758
7,044,340
9,331,420
8,145,068
7,083,702
5,500,316
CHANGE IN NET POSITION
3,805,102k9,611224
30,669
10,953,934
29,963,349
33,066,589
35,887,290
83,160,072
63,629,166
57,728,499
Total Net Position - Beginning
622,797,87173
6 14,997
644,345,666
563,607,078
593,570,427
626,637,016
620,971,490
704,131,562
767,760,728
Prior Period Adjustment - GASB 68 and 71
--
-
(91,692,522)
-
-
-
-
-
-
Prior Period Adjustment - GASB 75
(41,552,816)
Total Net Position - Ending
$626,602,973
$635,
,345,666
$563,607,078
$593,570,427
$626,637,016
$620,971,490
$704,131,562
$767,760,728
$825,489,227
Statement of Net Position
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020
2020-2021
Net Investment in Capital Assets
$549,462,506
$559,523,642
$568,006,023
$573,175,094
$581,844,903
$600,770,254
$623,307,342
$655,586,304
$692,117,172
$684,834,242
Restricted
4,663,601
4,730,837
4,809,248
4,288,008
4,363,251
4,449,437
4,421,504
(271,370)
2,639
34,929,105
Unrestricted
72,476,866
71,460,518
71,530,395
(13,856,024)
7,362,273
21,417,325
(6,757,356)
48,816,628
75,640,917
105,725,880
Total Net Position
$626,602,973
$635,714,997
$644,345,666
$563,607,078
$593,570,427
$626,637,016
$620,971,490
$704,131,562
$767,760,728
$825,489,227
Source: Central Contra Costa Sanitary Distract AudRed Financial Statements
S-1
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 176 of 220
Attachment 1
Fiscal
Year
Sewer Service
Charges*
City of
Concord
the ice
rges
Miscellaneous
Charges
Total
Operating
2011-2012
$49,123,848
$1 89
915,485
$929,917
$61,616,639
2012-2013
56,770,984
1 1
6,401
751,880
69,082,686
2013-2014
60,796,421
11, 864
1, 5,134
544,589
74,002,008
2014-2015
70,023,512
12,8 4
006,197
593,780
84,516,434
2015-2016
72,233,903
13,91
963,014
623,659
87,734,536
2016-2017
73,138,
31851,
1,029,500
606,453
88,625,441
2017-2018
75,82 1
4,973,6
1,078,594
619,997
92,496,435
2018-2019
68,6
1,126,239
689,727
85,678,166
2019-2020
70,408,
14,9 , 91
1,176,242
714,043
87,222,779
2020-2021
340
15,002,567
1,171,378
743,276
89,242,561
-Operating Revenue
Fiscal
Year
Property
Taxes
Customer
tributions *1
nections
& Other Fees *2
Interest
All
Other
Total Non -Operating
& Contributions
2011-2012
$12,047,169
9,680,6
$6,628,643
$294,938
$931,660
$29,583,084
2012-2013
13,010,477
4
7,261,338
405,474
951,100
30,569,164
2013-2014
13,093,841
1 83
9,799,768
359,288
932,464
36,133,744
2014 2015
14,083,331
7,5 3,841
8,517,240
318,475
1,828,530
32,311,417
2015-2016
14,835,167
13,765,920
11,090,481
562,308
1,195,095
41,448,971
2016-2017
16,318,874
19,527,147
9,645,228
761,838
966,244
47,219,331
2017-2018
17,650,741
22,429,128
11,923,557
1,223,349
1,075,838
54,302,613
2018-2019
18,251,794
38,741,782
10,793,776
2,573,964
1,424,520
71,785,836
2019-2020
18,876,886
45,984,766
9,334,947
2,310,269
1,219,811
77,726,679
2020-2021
20,516,826
41,144,017
7,940,503
1,678,028
3,193,569
74,472,943
* Sewer Service Charge (SSC) represents the Running Expense Fund portion of SSC County collections along with District direct billings and counter collections.
*1 Customer Contributions include the portion of SSC that is allocated to Sewer Construction Fund, City of Concord reimbursement of capital costs, and
developer contributed sewer lines beginning in 2000-2001, due to changes in GASB 33 reporting requirements.
*2 Includes connection fees, non -operating permit, inspection, and other fees.
Source: Central Contra Costa Sanitary District Audited Financial Statements
S-2
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 177 of 220
Attachment 1
$179,000,000
$129,000,000
N $79,000,000
m
0
$29,000,000
$(21,000,000)
$(71,000,000)
2011-2012 2012-2013
Li Salaries and Benefits
■ Self -Insurance
Central Contra Costa Sanitary District
Operating Expenses by Type
Last Ten Fiscal Years
2013-2014 2014-2015 2015-2016 016-2017 2017-2018 2018-2019 2019-2020 2020-2021
Fiscal
❑Chemicals, Utilities &Supplies P & Outside Services
❑ Depreciation � ension/OPEB Expense*
❑Hauling, Disposal, Repairs &Maintenance
o All Other
PE
ING MENSES
Fiscal Salaries Chemicals, Utilities Professional & Hauling, Dispo Depreciation Pension/OPEB All Total Operating
Non -Operating
Year
and Benefits
&Supplies
Outside Services
Repair nanc
Expense'
Other
Expenses
Expenses
2011-2012 45,562,430 8,121,809 4,099,876 4,07 810,849 21,190,059 - 1,612,482 85,475,246
1,919,375
2012-2013
49,811,218
7,401,103
2,836,638
4,239,4
2,380,466
21,596,266
-
472,630
88,737,742
1,802,084
2013-2014
58,954,453
8,063,310
3,995,861
4,041,3
858,738
21,892,545
-
1,702,131
99,508,394
1,996,689
2014-2015
66,104,630
7,466,490
3,322,881
5
1,146,381
22,740,942
($3,012,757)
1,823,963
104,350,790
1,523,127
2015-2016
63,988,158
7,304,619
4,196,302
11 ,533
1,572,486
22,885,030
(9,778,389)
1,843,778
97,792,517
1,427,641
2016-2017
62,342,392
8,115,004
3,891,224
5,662,086
619,892
22,892,153
(4,080,558)
2,022,592
101,464,785
1,313,398
2017-2018
68,862,484
7,477,602
2,988,280
5,461,011
252,517
21,561,704
1,104,358
1,973,122
109,681,078
1,230,680
2018-2019
65,071,382
8,093,144
3,276,763
5,755,590
1,039,444
20,983,353
(33,307,168)
2,366,416
73,278,924
1,025,006
2019-2020
62,672,096
8,088,750
2,684,034
5,435,406
1,110,798
21,253,062
(2,386,849)
1,858,144
100,715,441
604,851
2020-2021
134,187,829
8,738,404
4,160,807
5,751,355
550,000
21,531,302
(70,933,999)
1,459,081
105,444,779
542,226
Informational -not graph
Source: Central Contra Costa Sanitary District Audited Financial Statements
"Reflects pension/OPEB adjuestment at year-end to comply with the provisions of GASB Statements No. 68 and 75. Budgeted pension/OPEB emloyer contributions made during
the year are reported under "Salaries and Benefits".
December 21, 2021 Regular FINANCE Committee Meeting Agenda Pack�t� Page 178 of 220
Attachment 1
Fiscal Year
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020
2020-2021
Fiscal Year
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020
Central Contra Costa Sanitary District
Major Revenue Base and Rates
Historical and Current Fees
Last Ten Fiscal Years
Single Family Annual Sewer Service Charge (SSC) "1
Operations
Capital
Total
$302
$39
$341
344
27
371
365
40
405
416
23
439
422
49
471
432
71
503
447
83
530
400
167
567
408
190
59
$277
$352
$6
Multi -Family Annual Sewer Service Char
"1
Operations Capital
T
$300 $11
311
302 3
1
344 2
1
365 40
405
416
439
415 48
463
418 69
487
432 81
513
388 16
549
386
566
Facility
Capacity Fee `2
$5,465
5,797
5,930
5,995
6,005
5,948
6,300
6,700
6,589
$6,803
Pump
Zone Fee *3
$1,641
1,606
1,625
1,587
1,585
1,650
1,608
1,639
1,636
1,586
2020-2021 1 $262 $334 $596 1 1 $1,585
*1 All residential accounts paid a flat annual sewer service charge shown above per household through 2014-2015. In 2015-2016, as a result of a cost of service study, the District
changed to a two tier single family and multi family rate structure. The charge for commercial users consists of an annual rate based on a measured volume of water
usage per 100 cubic feet (HCF).
'2 New users who are connected to the Wastewater System are charged Capital Improvement Fees called Facility Capacity Fees. Fee is per connection.
*3 New customers in areas where wastewater pumping stations are needed to reach the District's gravity fed sewers are charged a Pump Zone Fee.
Fee is per connection.
Source: Central Contra Costa Sanitary District Environmental Services Division
S-4
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 179 of 220
Central Contra Costa Sanitary District
Assessed and Estimated Actual Valuation of Taxable Property
Last Ten Fiscal Years
Fiscal Year
Local Secured
Unsecured
Total
% Change
2011-2012
$67,486,938,247
$1,591,574,852
$69,078,513,099
-0.7%
2012-2013
67,538,246,870
1,604,518,295
69,142,765,165
0.1%
2013-2014
74,400,356,922
1,742,364,655
76,142,721,577
10.1%
2014-2015
80,431,132,956
1,739,342,301
82,170,475,257
7.9%
2015-2016
86,701,930,276
1,645,712,628
88,347,642,904
7.5%
2016-2017
92,006,863,080
1,704,263,642
93,711,126,722
6.1%
2017-2018
97,298,029,346
1,722,229,970
9,020,259,316
5.7%
2018-2019
102,984,718,407
1,801,374,86
86,093,269
5.8%
2019-2020
2020-2021
108,704,671,836
110,795,231,142
1,863,018
1,848,64 0 '
11 , 7,690,595
112,643,876,052
5.5%
1.9%
Property Tax and Sewer Serv*ALhargeM10&s Levied and Collected
Last Te ea
Property Tax*
Colle4ntia
Sewer Service Charges*
Collection
Fiscal Year
Levied &Collected
Perce
% Clue
Levied &Collected
Percentage
%Change
2011-2012
$12,032,525
-1.1%
$54,586,208
100%
8.7%
2012-2013
13,185,988 **
9.6%
60,068,807
100%
10.0%
2013-2014
13,108,176
-0.6%
66,604,323
100%
10.9%
2014-2015
14,195,300
8.3%
72,622,738
100%
9.0%
2015-2016
15,323,818
10
7.9%
78,930,977
100%
8.7%
2016-2017
16,428,089
10
7.2%
83,601,971
100%
5.9%
2017-2018
17,300,475
/0
5.3%
87,944,554
100%
5.2%
2018-2019
18,352,620
0%
6.1 %
95,298,869
100%
8.4%
2019-2020
19,348,103
100%
5.4%
100,863,356
100%
5.8%
2020-2021
20,233,423
100%
4.6%
100,603,114
100%
-0.3%
General County taxes collected are the same as the amount levied since the County participates in California's alternative method of
apportionment called the Teeter Plan. The Teeter Plan as provided in Section 4701 et seq. of the State Revenue and Taxation Code,
establishes a mechanism for the County to advance the full amount of property tax and other levies to taxing agencies based on the
tax levy, rather than on the basis of actual tax collections. Although this system is a simpler method to administer, the County assumes
the risk of delinquencies. The County in return retains the penalties and accrued interest thereon.
" Includes repayment of Prop 1A loan in June, 2013. The repayment amount includes $985,916 of principal and $65,545 of interest
for a total of $1,051,461.
Source: Contra Costa County Auditor -Controller's Office
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet- Page 180 of 220
Attachment 1
2010-2011
Central Contra Costa Sanitary District
Sewer Service Charge
Ten Largest Customers
Last Ten Fiscal Years
2011-2012
2012-2013
2013-2014
2014-2015
Percentage of
Percentage of
Percentage
of
Percentage of
Percentage
of
Operating
Operating
Operating
Operating
Operating
Operating
Operating
Operating
Operating
Operating
Customer
Revenue
Rank
Revenue
Revenue
Rank
Revenue
Revenue
R
Revenue
Revenue
Rank
Revenue
Revenue
Rank
Revenue
City of Concord 1.
$9,224,952
1
15.40%
$10,647,389
1
17.28%
$10,483,42
1
15.18%
$11,625,864
1
15.71%
$12,892,945
1
15.25%
Contra Costa County General Services 2.
301,430
2
0.50%
292,384
4
0.47%
321
0.47%
384,750
3
0.52%
451,567
2
0.53%
First Walnut Creek Mutual
295,450
3
0.49%
323,950
2
0.53%
3 0
0.51%
361,260
4
0.49%
417,050
3
0.49%
Park Regency Apartments
277,412
4
0.46%
304,172
3
0.49%
0,932
3
8%
303,750
5
0.41%
391,588
4
0.46%
Second Walnut Creek Mutual Apts
233,250
5
0.39%
255,750
5
0.42%
78,250
5
211,866
6
0.29%
329,250
5
0.39%
Sun Valley Mall
193,957
6
0.32%
203,037
6
0.33%
174,038
7
0.
148,374
8
0.20%
299,697
6
0.35%
Chevron Offices & Office Park
-
-
-
-
419,590
2
0.57%
-
Kaiser Foundation Hospital 2.
-
-
-
-
-
-
-
158,848
8
0.19%
Branch Creek Vista Apartments
124,400
7
0.21%
136,400
7
0.22%
400
9
0.21%
162,000
7
0.22%
175,600
7
0.21%
Bay Landing Apartments
111,960
8
0.19%
122,760
8
0.20%
3,560
10
0.19%
145,800
9
0.20%
158,040
9
0.19%
St. Marys College Contract
-
-
119,407
9
°0
480
8
0.23%
-
-
-
-
John Muir Health 2.
-
-
-
1 1
6
0.26%
145,091
10
0.20%
-
-
Archstone Apartments
108,850 9-10
0.18%
119,350
10
9%
-
-
-
153,650
10
0.18%
Muirland @ Windemere Apartments
108,850 9-10
0.18%
119,350
10
%
-
153,650
10
0.18%
Total
$10,980,511
18.33%
$12,64
20.
$12,557,715
18.18%
$13,908,345
18.79%
15, 581,885
°
18.44 /o
2015-2016
20
2017-2018
2018-2019
2019-2020
Percentage of
of
Percentage
of
Percentage of
Percentage
of
Operating
Operating
O
Operating
Operating
Operating
Operating
Operating
Operating
Operating
Customer
Revenue
Rank
Raven
Reve
Rank
Revenue
Revenue
Rank
Revenue
Revenue
Rank
Revenue
Revenue
Rank
Revenue
City of Concord 1.
$13,913,960
1
1 °
51,2
1
15.63%
$14,973,623
1
16.19%
$15,205,292
1
16.44%
$14,923,591
1
16.13%
Contra Costa County General Services 2.
638,608
2
%943
,
0.62%
556,782
2
0.60%
-
-
733,416
2
0.79%
First Walnut Creek Mutual
439,850
3
%
650
3
0.52%
487,350
3
0.53%
521,550
2
0.56%
537,700
3
0.58%
Park Regency Apartments
412,996
4
404
4
0.49%
457,596
4
0.49%
489,708
3
0.53%
504,872
4
0.55%
Second Walnut Creek Mutual Apts
347,250
5
0.4
250
5
0.41 %
387,750
5
0.42%
411,750
6
0.45%
424,500
5
0.46%
John Muir Health 2.
218,919
7
0.25%
21601
6
0.36%
278,589
7
0.30%
413,900
5
0.45%
391,245
6
0.42%
Sun Valley Mall
283,613
6
0.32%
298,005
7
0.34%
354,208
6
0.38%
453,512
4
0.49%
373,171
7
0.40%
Bishop Ranch City Center
-
-
-
-
-
-
315,106
7
0.34%
335,017
8
0.36%
San Ramon Unified School District
215,044
8
0.25%
225,339
8
0.25%
247,766
8
0.27%
266,550
8
0.29%
283,631
9
0.31%
Branch Creek Vista Apartments
-
-
194,800
9
0.22%
205,200
9
0.22%
219,600
10
0.24%
226,400
10
0.24%
Kaiser Foundation Hospital 2.
186,232
10
0.21%
186,281
10
0.21%
-
-
244,180
9
0.26%
-
-
Willows Shopping Center 2.
206,210
9
0.24%
-
-
188,828
10
0.20%
-
-
-
Total
$16,862,681
19.22%
$16,888,526
19.06%
$18,137,692
19.61%
$18,541,148
20.05%
18,733,543
°
20.25/0
1. Contract with the City of Concord to treat and dispose of wastewater for the
cities of Concord and Clayton.
The City of Clayton contracts with the City of Concord for the maintenance,
operation,
and capital replacement/improvement
of its sewage collection system, which runs through the City of Concord.
2. Kaiser, John Muir Health, Willows Shopping Center, and County hospital are permitted
industries.
Source: Central Contra Costa Sanitary District Environmental Services Division
S-6
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 181 of 220
Attachment 1
Fiscal Year
2011-12
2012-13
2013-14
2014-15
2015-16
2016-17
2017-18
2018-19
2019-20
2020-21
User Group
Residential
Mixed Use
Office
Hotel/Motel
Food Service
Government
Schools
Recreation/Entertainment
Businesses
Automotive/Car Wash
Market/Supermarket
Industrial Permitted
All Other User Groups
Subtotal
Central Contra Costa Sanitary District
Payments Under the Concord Agreement
Last 10 Fiscal Years
Discharge Volume (mg)
4,279
4,213
3,914
3,826
3,878
4,800
4,265
4,512
4,383
3,922
Service ChargE
$10, 647, 389
10,483,421
11,625,864
12,892,945
13,913,960
13,851,253
14,973,623
15,205,292
14,923,591
15,048,782
;j
Central Contra Costa Sanit
Active Service Accounts and Fis
Sewer Serviceftj
Fiscal Year 2
No. of Accounts
114,993
426
712
1-11
138
383
244
39
11
491
117,988
Partial Year Charges (Counter)
Prior Year Adjustments
Total FY 2019-2020 Sewer Service Charge Revenue
1% 6,6-U,852
2,852,440
1,410,709
1,188,731
1,121,289
1,010,889
843,247
808,415
737,895
567,290
497,443
2,630,906
$102,896,012
$347,497
(4,648)
$103,238,861
Capital Contributions
$2,541,688
3,616,771
3,820,858
2,897,491
3,671,892
4,476,961
6,364,725
7,973,516
01 1,393,000
64.155
Residential Unit Equivalents
138,154
11,055
4,770
2,359
1,988
1,875
1,690
1,410
1,352
1,234
949
832
4,041
171,709
Total
$13,189, 077
14,100,192
15,446,722
15,790,436
17,585,852
18,328,214
21,338,348
23,178,808
26,316,591
25,112,937
Percentage of
Tntal
I UU%
S-7
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 182 of 220
Debt Service Paid Each Fiscal Year
$7,000,000
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$0
Summary Of Debt Service
Last Ten Fiscal Years
$75,000,000
$60,000,000
m $45,000,000
0
o $30,000,000
$15,000,000
$0
Attachment 1
Outstanding Debt Each Fiscal Year
In 2021, the District issued COP's for $58.0M, see Note 6
ryO,�^l ryO,�K ry°^4J ryO^4f ryO,�K ryO,�9f ,v°^M �0,��
Summary a Of D
venue Bonds (2018 & 2009)
•
To ebt Service Annual Expense
• =
•
•
Fiscal
Interest & Total
Interest &
Total Interest & Total
Rev. Bonds
o .
.. -
Year
Principal Amortization Debt Service
Principal
Amortization
Debt Service ipal Amortization Debt Service
& COP's
..
•
2011-2012
$3,465,000
$1,888,601
$5,353,601
$156,346
$30,773 7,119 $34W346
$1,919,375
$5,540,721
$47,200,000
$1,027,237
$48,227,237
2012-2013
3,605,000
1,775,376
5,380,376
160,411
26,708 3,713Wl
1,802,084
5,567,495
43,595,000
866,826
44,461,826
2013-2014
3,720,000
1,974,151 <a>
5,694,151
164,581
22,537 87, 884,.1W
1,996,688
5,881,269
39,875,000
702,245
40,577,245
2014-2015
3,865,000
1,504,939
5,369,939
168,860
18,258 7,1 860
1,523,197
5,557,057
36,010,000
533,385
36,543,385
2015-2016
2,210,000
1,413,772
3,623,772
173,251
8 2, 3,251
1,427,640
3,810,891
33,800,000
360,134
34,160,134
2016-2017
2,300,000
1,304,036
3,604,036
177,757
19 2,477,757
1,313,398
3,791,155
31,500,000
182,377
31,682,377
2017-2018
2,405,000
1,225,938
3,630,938
182,377
4,74 1 19 2,587,377
1,230,680
3,818,057
29,095,000
-
29,095,000
2018-2019
-
1,025,006
1,025,006
-
1,025,006
1,025,006
21,806,631
21,806,631
2019-2020
2,145,000
604,851
2,749,851
2,145,000
604,851
2,749,851
19,447,392
19,447,392
2020-2021
1 1,740,000
1 542,226
1 2,282,226
1,740,000
1 542,226
1 2,282,226
1 75,733,331
75,733,331
a e Summary 0
1
Debt Ratios
Total
Total OperatineAnue
Debt Service Capital
Debt Service
Annual Debt Annual Debt Total Debt
Fiscal
Debt
Operating Expenses leseN*2
Coverage Improvement
Adjusted Net
Coverage
Service to Service per Outstanding
Year
Service
Revenue Depreciation(Net
Revenue) *3 Fees/Concord
Revenue *4
(Adj. Net Revenue) *5
Operating Exp. Customer Per Customer
2010-2011
$5,674,288
$59,896,560
$58,235,679N32,31
1
$ 11,832
4.32
$6,731,994
$17,779,838
3.13
9.74%
$34.67
$316.81
2011-2012
5,540,721
61,616,639
64,285,1874
14,536
4.86
8,266,521
18,648,015
3.37
8.62%
34.06
296.47
2012-2013
5,567,495
69,082,686
67,141,4764
510,374
5.84
9,708,300
22,802,074
4.10
8.29%
33.78
269.73
2013-2014
5,881,269
74,002,008
77,615,849
32,519,903
5.53
12,045,375
20,474,528
3.48
7.58%
35.31
243.60
2014-2015
5,557,057
84,516,434
81,609,848
35,218,003
6.34
9,570,789
25,647,214
4.62
6.81%
33.01
217.10
2015-2016
3,810,891
87,734,536
74,907,487
41,448,971
54,276,020
14.24
12,215,650
42,060,370
11.04
5.09%
22.28
199.74
2016-2017
3,791,155
88,625,441
78,572,632
47,219,331
57,272,140
15.11
11,521,301
45,750,839
12.07
4.83%
22.36
186.85
2017-2018
3,818,057
92,496,435
88,119,374
51,841,253
56,218,314
14.72
15,696,145
40,522,169
10.61
4.33%
22.51
171.56
2018-2019
1,025,006
85,678,166
52,295,571
70,760,830
104,143,425
101.60
16,118,584
88,024,841
85.88
1.96%
5.98
127.15
2019-2020
2,749,851
87,222,779
79,462,379
77,121,828
84,882,228
30.87
18,476,702
63,795,526
23.20
3.46%
15.93
112.65
2020-2021
2,282,226
89,242,561
83,913,477
73,930,717
79,259,801
34.73
15,564,471
63,695,330
27.91
2.72%
13.32
441.92
Note: Details regarding the District's outstanding debt can be found in the notes to the financial statements.
<a> GASB Statement No. 65 required that bond issuance costs of $315,287, previously being amoritized annually, be expensed in FY 2013-2014.
*1 2014-2015 includes implementaion of pension expense reporting changes for GASB 68 & 71.
*2 Net Revenue = Operating Revenue, less Total Operating Expenses less Depreciation, plus Non -Operating Revenue & Contributions.
*3 This ratio must be above 1.00 to meet the Debt Rate Covenant (Net Revenue/Total Debt Service).
*4 Adjusted Net Revenue = Net Revenue less Capital Improvement Fees (Connection Fees) and City of Concord Capital Charges. In FY 2019-20 the Board,
by Resolution, adopted rate stabilization fund reserve accounts for the OW and Sewer Construction funds, contributing initial seed monies of $2.61 million.
*5 This ratio must be above 1.25 to meet the Debt Rate Covenant (Adjusted Net Revenue/Total Debt Service).
Source: Central Contra Costa Sanitary District Audited Financial Statements and Internal Accounting Records
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 183 of 220
s-8
Debt Restrictions:
Revenue Pledge & Covenant: The District pledges
Property Tax Revenue along with its ability to raise Sewer
Service Charge (SSC) rates. Debt Coverage requirements
are discussed in the footnotes to the left.
Attachment 1
Central Contra Costa Sanitary District
Demographic and Economic Data
Population Served
Last Ten Calendar Years
Inside District
As Of January 1
Boundaries
2011
321,800
2012
326,900
2013
332,600
2014
335,009
2015
339,029
2016
340,667
2017
344,591
2018
348,333
2019
352,733
2020
342,149
Source: Central Contra Costa Sanitary District Environmental Services Division
Employers
Chevron Corporation
St. Mary's College
Bio-Rad Laboratories
Job Connections
John Muir Medical Center '
Kaiser Permanente
La Raza Market
Martinez Medical Offices
USS-POSCO Industries
Target Corporation
Walmart Stores, Inc.
Doctors Medical Center
Contra Costa Newspaper, Inc.
Shell/Martinez Refinery
Texaco Inc.
All Others
Total
List of Ten Largest Ei
Last Year
-2
4'999
T-2
-4,999
K
T-2
-4,999
T-2
,-4,999
T-2
1,000-4,999
T-2
1,000-4,999
T-2
1,000-4,999
T-2
439,500
473,500
Concord/
Clayton
133,600
134,200
13:,90
135,
1
Costa County
2.11%
0.63%
0.63%
0.63%
0.63%
0.63%
0.64%
0.64%
0.64%
92.82%
Total
Served
455,400
461,100
467,500
470,865
476,386
481,583
484,245
488,923
494,275
483,629
2012'
Change
-1.4%
1.3%
1.4 %
0.7%
1.2%
1.1%
0.6%
1.0%
1.1%
-2.2%
Estimated
% of Total County
Employees
Rank
Employment
1,329
3
0.28%
900
9
0.19%
2,200
1
0.46%
2,000
2
0.42%
1,262
4
1,150
5
937
7
1,140
6
900
8
800
10
465,281
0.26%
0.24%
0.19%
0.24%
0.19%
0.17%
97.36%
100.0% 477,899 100.0%
Source: ' County of Contra Costa, California, Comprehensive Annual Financial Report for June 30, 2020, Statistical Section, principal employers excludes government employers.
S-9
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 184 of 220
Attachment 1
Fiscal Year
Ended
June 30
2U11
2012
2013
2014
2015
2016
2017
2018
2019
2020
Central Contra Costa Sanitary District
Demographic and Economic Statistics
Contra Costa County
Population*
1,066,182
1,079,093
1,095,310
1,110,971
1,126,027
1,138, 645
1,147,439
1,150,215
1,153, 526
1,152,333
U.S. Department of Commerce, E
State of California, Employment
Last Ten Fiscal Years
Pes#lrpita
Personal nal
Income* ^ncl%�
$61,498,902,000
66,772,041,00�
67,290,115,00
71,164,4 8,000
77,914,
82,204,4 00
27
4,9 003, 0
$57,161,878
61,435
64,056
69,195
72,195
76,527
82,506
85,324
92,264
Average Annual
Unemployment
Rate**
10.4%
9.0%
7.4%
6.2%
5.0%
4.4%
3.8%
2.7%
7.9%
5.3%
for 2020-2021 reflect county population estimates available as of October 2021.
), annual calendar figure.
S-10
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 185 of 220
Department
Administration
Engineering
Operations
Collection Systems
Plant
Pumping Station
Operations Total
District Total
District Total
Central Contra Costa Sanitary District
Full-time Equivalent Positions Filled by Department
Last Ten Fiscal Years
2012
39
71
Full-time Equivalent Positions Filled as of June 30
2013 2014 2015 2016 2017
39 44 46 43
75 73 72 A 88 8
47
56
71
76
7
8
125
140
235 254
237 244 243
Source: Central Contra Costa Sanitary District Finance and Human Resources Divisions
2018
2019
2020
2021
43
41
44
51
89
90
89
90
55
55
54
54
53
55
83
81
77
81
75
7
7
12
7
7
`k1
145
142
143
141
137
276
274
274
278
278
274
and Surviving Spouses as of June 30
st Ten Fiscal Years
244
249
259
278 268 269 261
S-11
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 186 of 220
Central Contra Costa Sanitary District
Capital Asset and Operating Statistics
Last Ten Calendar or Fiscal Years
Treatment Plant
Attachment 1
Millions of Gallons per Day (mgd)
Year 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Treatment Plant Permitted Capacity
Calendar 53.8 53.8 53.8
53.8
53.8
53.8
53.8
53.8
53.8
53.8
Average Dry Weather Flow (ADWF)
Calendar 37.2 33.2 33.8
30.4
29.1
30.8
33.3
31.8
34.1
29.5
Wastewater Treated per day
Calendar 41.9 39.8 36.8
35.6
31.8
35.4
43.2
36.0
41.2
35.3
Tons
per Year
Sludge to Furnace (Dry)*1
Fiscal 15,790 15,097 14,590
16,789
16,623
17,031
16,279
16,498
16,056
16,029
Ash to Reuse Site (Wet)*2
Fiscal 3,850 3,667 3,618
3,811
3,651
4,230
3,475
3,577
3,450
3,410
'1 In the multi -hearth furnace, the wet sludge is converted to dry ash. Water is added to the dry ash as it is loaded into trucks (ratio of 60 percent ash to 40 per
t water) to
prevent the ash
from blowing out of the truck during
transport.
'2 Wet sludge, which at 19 to 27 percent solids, is pumped to the multiple -hearth furnace for incineration. The table above shows the dry tons per year of s
o the furnace, excluding the
73 to 81 percent water in the wet sludge.
Collection Systems/Pumping Stations/Outfall Sewers
ata
Pipeline Miles
Calendar 1,500 1,526 1, 26
9
1,519
1,519
1,535
1,535
1,535
1,535
Number of pumping stations (owned)
Calendar 16 16 16
16
16
15
15
15
15
Recycled Water
Recycled Water Distribution Pipeline (miles)
Calendar 11.7 1 .3
14.3
14.6
14.6
14.6
14.6
14.6
14.6
Average Recycled Water Produced (million gallons per day)
Calendar 1.8 1. 1.7
1.6
1.7
1.5
1.6
1.6
1.6
1.4
Number of Recycled Water Customers Sites
Calendar 29 29 29
29
43
47
47
49
50
58
Commercial Truck Fill Use (million gallons per year)
Calendar <0. <0.1 .1
0.3
4.4
0.4
0.6
0.6
4.6
4.8
Commercial Truck Fill Customers
Calendar 3
11
37
26
14
13
12
6
Estimated Residential Fill Station Use (million gallons per year)
Calendar N/A N/A
N/A
11.8
6.5
2.5
2.3
1.3
1.0
Residential Fill Station Customer Visits
Calendar N/A N/A
N/A
55,552
28,598
11,633
9,780
5,671
4,635
Household Hazardous Waste (HHW) - Inception 1997/1998
Program Participation (Number of cars)
Fi 2 2 19 30,379
31,779
33,468
33,037
35,640
36,108
27,818
35,634
Percentage of Households in Service Area
4% 15.9%
16.6%
16.8%
16.7%
18.1 %
18.4%
14.0%
17.9%
Operating Cost per Car
Fisc $93 $83
$78
$72
$80
$77
$78
$100
$95
Pounds of HHW per Car
Fiscal 67 68 66
63
64
65
64
61
61
76
Pharmaceutical Collection Program - Inception 2009
Number of Collection Sites
Calend 10 10 12
13
13
13
13
13
12
12
Pounds of Expired or Unwanted medications Collected
Calenda 9,434 12,240 12,428
14,041
15,366
16,485
17,337
17,178
9,918
5,645
Miscellaneous Statistics
Governing Body:
ber Board of Directors elected at large
Governmental Structure:
Established in 1946 under the Sanitary District Act of 1923
Staff:
278 full-time equivalent employees (292 budgeted/authorized)
Authority:
California Health and Safety Code Section 4700 et. Seq.
Services:
Wastewater collection, treatment, and disposal
Household Hazardous Waste (HHW) Facility
Recycled Water
Residential and Truck Recycled Water Fill Station
Pharmaceutical Collection Program (12-Collection Sites)
Retail HHW Collection Program
Type Of Treatment:
Discharge - Secondary; Reclamation - Tertiary
Service Area:
146 square miles
Total Population Served:
484,795 (HHW service area 518,900)
Sewer Service Charge:
$567 for single family homes and $549 for multi -family
homes.
Source: Central Contra Costa Sanitary District records
S-12
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 187 of 220
Page 90 of 104
Attachment 2
CENTRAL CONTRA COSTA SANITIW
REQUIRED C
INS
CT
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 188 of 220
Page 91 of 104
Attachment 2
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 189 of 220
Page 92 of 104
Attachment 2
CENTRAL CONTRA COSTA SANITARY DISTRICT
MEMORANDUM ON INTERNAL CONTROL
AND
REQUIRED COMMUNICATIONS
For the Year Ended June 30, 2021
Table of Contents
Page
Memorandum on Internal Control....................................................................................................1
Scheduleof Other Matters...................................................................................................
3
Required Communications............................................................................................1
1
SignificantAudit Matters ......................................... ........................... ...........................1
1
AccountingPolicies....................................................................................................11
Unusual Transactions, Controversial o g Ar.................................................
I I
Accounting Estimates ............... ..............................................................................11
Disclosures..................... .......... ................................................................................12
Difficulties Encountered in rming t e Audit...............................................................12
Corrected an correct e iss ents...........................................................................12
Disagreements Mana ent.........................................................................................12
Management Represe ons...............................................................................................12
Management Consultations with Other Independent Accountants.....................................12
Other Audit Findings or Issues.............................................................................................12
Other Information Accompanying the Financial Statements...............................................13
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 190 of 220
Page 93 of 104
Attachment 2
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 191 of 220
Page 94 of 104
Attachment 2
U/, M ACZTE
MEMORANDUM ON INTERNAL CONTROL
To the Board of Directors
Central Contra Costa Sanitary District
Martinez, California
In planning and performing our audit of the basic financial statements of the Central Contra Costa Sanitary
District (District) as of and for the year ended June 30, 2021, in accordance with auditing standards generally
accepted in the United States of America, we considered the District's internal control over financial reporting
(internal control) as a basis for designing our auditing procedures that are appropriate in the circumstances for
the purpose of expressing our opinions on the financial statements, but t for the purpose of expressing an
opinion on the effectiveness of the District's internal control. Accord in e do not express an opinion on the
effectiveness of the District's internal control.
A deficiency in internal control exists when the design or oper of a co does not allow management or
employees, in the normal course of performing their assi functions, t vent, or detect and correct
misstatements on a timely basis. A material weakness i jdefic* y, or a combination of deficiencies, in
internal control, such that there is a reasonable possibility thrial misstatement of the District's financial
statements will not be prevented, or detected and corrected, onely basis.
Our consideration of internal control was for the
designed to identify all deficiencies in inte c<
of inherent limitations in internal con ,
misstatements due to error or fraud occu
during our audit we did not identi ny
weaknesses. However, material weakne ay t
Included in the Schedi
believe to be of potentiE
dXcribed in the first paragraph and was not
Ff�igWe material weaknesses. In addition, because
.e possibility of management override of controls,
j detected by such controls. Given these limitations,
in internal control that we consider to be material
have not been identified.
recommendations not meeting the above definitions that we
This communication is intende3%eWr the information and use of management, Board of Directors, others
within the organization, and agenc nd pass -through entities and is not intended to be and should not be used
by anyone other than these specified parties.
Pleasant Hill, California
DATE
Accountancy Corporation
3478 Buskirk Avenue, Suite 215
Pleasant Hill, CA 94523
r 925.930.0902
F 925.930.0135
e maze@mazeassociates.com
w mazeassociates.com
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 192 of 220
Page 95 of 104
Attachment 2
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 193 of 220
Page 96 of 104
Attachment 2
CENTRAL CONTRA COSTA SANITARY DISTRICT
SCHEDULE OF OTHER MATTERS
FOR THE YEAR ENDED JUNE 30, 2021
2021-01 New GASB Pronouncements Not Yet Effective
The following comment represents new pronouncements taking effect in the next few years. We have cited
them here to keep you abreast of developments:
EFFECTIVE FISCAL YEAR 2021/22:
GASB 87 — Leases
The objective of this Statement is to better meet the information needs of financial statement users by improving
accounting and financial reporting for leases by governments. 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 outflows of resources
based on the payment provisions of the contract. It establishes a single mo 1 for lease accounting based on the
foundational principle that leases are financings of the right to use an u ymg asset. Under this Statement, a
lessee is required to recognize a lease liability and an intangible righ sa lease asset, and a lessor is required
to recognize a lease receivable and a deferred inflow of reso , by enhancing the relevance and
consistency of information about governments' leasing activitie,0
A lease is defined as a contract that conveys control of
underlying asset) as specified in the contract for :
transaction. Examples of nonfinancial assets mcludjlJLuJ
meets this definition should be accounted for un
Statement.
GASB 89 —
The objectives of this Statement are
assets and the cost of borrowin 0,
before the end of a construct'
Re another entity's nonfinancial asset (the
time in an exchange or exchange -like
vehicles, and equipment. Any contract that
kgnce, unless specifically excluded in this
Pffivance and comparability of information about capital
and (2) to simplify accounting for interest cost incurred
This Statement establishe ounting r irements for interest cost incurred before the end of a construction
period. Such interest cost des a terest that previously was accounted for in accordance with the
requirements of paragraphs 5— tement No. 62, Codification of Accounting and Financial Reporting
Guidance Contained in Pre-Nove r 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.
This Statement also reiterates that in financial statements prepared using the current financial resources
measurement focus, interest cost incurred before the end of a construction period should be recognized as an
expenditure on a basis consistent with governmental fund accounting principles.
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 194 of 220
Page 97 of 104
Attachment 2
CENTRAL CONTRA COSTA SANITARY DISTRICT
SCHEDULE OF OTHER MATTERS
FOR THE YEAR ENDED JUNE 30, 2021
EFFECTIVE FISCAL YEAR 2022/23:
GASB 91— Conduit Debt Oblizations
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 required note disclosures.
A conduit debt obligation is defined as a debt instrument having all of the following characteristics:
• There are at least three parties involved:
(1) an issuer
(2) a third -party obligor, and
(3) a debt holder or a debt trustee.
• The issuer and the third -party obligor are not within
• The debt obligation is not a parity bond of the
issuer.
• The third -party obligor or its agent, not
issuance.
• The third -party obligor, not
with the debt obligation (del
entity.
cross -collateralized with other debt of the
y receives the proceeds from the debt
obligated for the payment of all amounts associated
All conduit debt obligations ' i making a limited commitment. Some issuers extend additional
commitments or voluntary, itmen %su rt debt service in the event the third party is, or will be, unable
to do so.
An issuer should not recognize t debt obligation as a liability. However, an issuer should recognize a
liability associated with an addi iofWcommitment or a voluntary commitment to support debt service if certain
recognition criteria are met. As long as a conduit debt obligation is outstanding, an issuer that has made an
additional commitment should evaluate at least annually whether those criteria are met. An issuer that has made
only a limited commitment should evaluate whether those criteria are met when an event occurs that causes the
issuer to reevaluate its willingness or ability to support the obligor's debt service through a voluntary
commitment.
This Statement also addresses arrangements —often characterized as leases —that are associated with conduit
debt obligations. In those arrangements, capital assets are constructed or acquired with the proceeds of a conduit
debt obligation and used by third -party obligors in the course of their activities. Payments from third -party
obligors are intended to cover and coincide with debt service payments. During those arrangements, issuers
retain the titles to the capital assets. Those titles may or may not pass to the obligors at the end of the
arrangements.
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 195 of 220
Page 98 of 104
Attachment 2
CENTRAL CONTRA COSTA SANITARY DISTRICT
SCHEDULE OF OTHER MATTERS
FOR THE YEAR ENDED JUNE 30, 2021
GASB 91— Conduit Debt Oblikations (Continued)
Issuers should not report those arrangements as leases, nor should they recognize a liability for the related
conduit debt obligations or a receivable for the payments related to those arrangements. In addition, the
following provisions apply:
• If the title passes to the third -party obligor at the end of the arrangement, an issuer should not recognize
a capital asset.
If the title does not pass to the third -party obligor and the third party has exclusive use of the entire
capital asset during the arrangement, the issuer should not recognize a capital asset until the
arrangement ends.
If the title does not pass to the third -party obligor and the third party has exclusive use of only portions
of the capital asset during the arrangement, the issuer, at the i ption of the arrangement, should
recognize the entire capital asset and a deferred inflow of reso s. The deferred inflow of resources
should be reduced, and an inflow recognized, in a systemat' ational manner over the term of the
arrangement.
This Statement requires issuers to disclose general informa ' about their coi?Wt debt obligations, organized
by type of commitment, including the aggregate outsta pr' al amount of the issuers' conduit debt
obligations and a description of each type of commitment. Is at recognize liabilities related to supporting
the debt service of conduit debt obligations also s ld disclo ormation about the amount recognized and
how the liabilities changed during the reporting per
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 196 of 220
Page 99 of 104
Attachment 2
N MAZE
&ASSOC IATES
REQUIRED COMMUNICATIONS
To the Board of Directors
Central Contra Costa Sanitary District
Martinez, California
We have audited the basic financial statements of the Central Contra Costa Sanitary District (District) for the
year ended June 30, 2021. Professional standards require that we communicate to you the following information
related to our audit under generally accepted auditing standards.
Significant Audit Matters
Accounting Policies
Management is responsible for the selection and use of
accounting policies used by the District are included in Note
policies were adopted and the application of existing policiJ
GASB 84 - Fiduciary Activities
The objective of this Statement is to it
for accounting and financial reportiU
This Statement establishes cri for
The focus of the criteria g lly
fiduciary activity and (2) the b
are included to ident'
fiduciary activities
�priate a01Wting policies. The significant
the financial9wernents. No new accounting
iglohanged during the year except as follows:
cYng the identification of fiduciary activities
se activities should be reported.
in fiduciary activities of all state and local governments.
ether a government is controlling the assets of the
whom a fiduciary relationship exists. Separate criteria
units and postemployment benefit arrangements that are
An activity meeting riteria uld be reported in a fiduciary fund in the basic financial statements.
Governments with act i mg the criteria should present a statement of fiduciary net position and
a statement of changes in ciary net position. An exception to that requirement is provided for a
business -type activity that normally expects to hold custodial assets for three months or less.
This Statement describes four fiduciary funds that should be reported, if applicable: (1) pension (and
other employee benefit) trust funds, (2) investment trust funds, (3) private -purpose trust funds, and (4)
custodial funds. Custodial funds generally should report fiduciary activities that are not held in a trust or
equivalent arrangement that meets specific criteria.
A fiduciary component unit, when reported in the fiduciary fund financial statements of a primary
government, should combine its information with its component units that are fiduciary component units
and aggregate that combined information with the primary government's fiduciary funds.
This Statement also provides for recognition of a liability to the beneficiaries in a fiduciary fund when
an event has occurred that compels the government to disburse fiduciary resources. Events that compel a
government to disburse fiduciary resources occur when a demand for the resources has been made or
when no further action, approval, or condition is required to be taken or met by the beneficiary to
release the assets.
Accountancy Corporation
3478 Buskirk Avenue, Suite 215
Pleasant Hill, CA 94523
r 925.930.0902
F 925.930.0135
e maze@mazeassociates.com
w mazeassociates.com
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 197 of 220
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Attachment 2
The pronouncement became effective, and as disclosed in Note 1M to the financial statements.
GASB 90 — Maiority Equity Interests (an amendment of GASB Statements No. 14 and No. 61)
The primary objectives of this Statement are to improve 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.
For all other holdings of a majority equity interest in a
should report the legally separate organization as a coma
holds the equity interest should report an asset related to
method. This Statement establishes that ownership of
organization results in the government being f ci
organization and, therefore, the government shoul ort 1
This Statement also requires that a coml
interest account for its assets, deferred
resources at acquisition value at the date
component unit. Transactions pre se d i�
should include only transactions)
The pronouncement became
Unusual Transactions,
We noted no
guidance or consensus.
proper period.
irate organization, a government
and the government or fund that
equity interest using the equity
interest in a legally separate
for the legally separate
tion as a component unit.
Lich a government has a 100 percent equity
ces, liabilities, and deferred inflows of
as uired a 100 percent equity interest in the
!Cs of the component unit in that circumstance
to the acquisition.
a material effect on the financial statements.
during the year for which there is a lack of authoritative
have been recognized in the financial statements in the
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Attachment 2
Accounting Estimates
Accounting estimates are an integral part of the financial statements prepared by management and are based on
management's current judgments. Those judgments are normally based on knowledge and experience about past
and current events and assumptions about future events. Certain accounting estimates are particularly sensitive
because of their significance to the financial statements and because of the possibility that future events
affecting them may differ significantly from those expected. The most sensitive estimates affecting the District's
financial statements are depreciation, claims liability and actuarial estimates for net pension liability and net
other post -employment benefits liability.
The value of the assets, liability and assumptions used to determine annual required contributions for other post -
employment benefits is determined by an actuary study provided to the District as of June 30, 2021. The value
of the District's net pension liability was obtained from an actuarial valuation provided by CCCERA.
Management's estimate of depreciation is based on the estimated usefu lives of the capital assets, and its
estimate of claims is based on the District Attorney's estimates oNI&
otential litigation, as well as
actuary studies provided for the District as of June 30, 2021. We evfactors and assumptions used
to develop the depreciation expense and claims liability and reviectuary study and determined
that they are reasonable in relation to the basic financial stateme .
Disclosures
The financial statement disclosures are neutral, consigtent, and
Difficulties Encountered in Performing the Audit
We encountered no significant difficultie,Jll%ng wlWmanagement in performing and completing our audit.
Corrected and Uncorrected
Professional standards requir u e all known and likely misstatements identified during the audit,
other than those that are c y trivia , d c unicate them to the appropriate level of management. We did
not propose any audit add ents that, our judgement, could have a significant effect, either individually or
in the aggregate, on the Dist financ* reporting process.
Professional standards require us accumulate all known and likely uncorrected misstatements identified
during the audit, other than those that are trivial, and communicate them to the appropriate level of management.
We have no such misstatements to report to the Board of Directors.
Disagreements with Management
For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing
matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the
auditor's report. We are pleased to report that no such disagreements arose during the course of our audit.
Management Representations
We have requested certain representations from management that are included in a management representation
letter dated DATE.
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Attachment 2
Management Consultations with Other Independent Accountants
In some cases, management may decide to consult with other accountants about auditing and accounting
matters, similar to obtaining a "second opinion" on certain situations. If a consultation involves application of an
accounting principle to the governmental unit's financial statements or a determination of the type of auditor's
opinion that may be expressed on those statements, our professional standards require the consulting accountant
to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such
consultations with other accountants.
Other Audit Findings or Issues
We generally discuss a variety of matters, including the application of accounting principles and auditing
standards, with management each year prior to retention as the District's auditors. However, these discussions
occurred in the normal course of our professional relationship and our responses were not a condition to our
retention.
Other Information Accompanying the Financial Statements
We applied certain limited procedures to the required
supplements the basic financial statements. Our procedures
methods of preparing the information and comparing tl
responses to our inquiries, the basic financial statements, ai
the basic financial statements. We did not audit th equir(
opinion or provide any assurance on the required st
itary tion that accompanies and
of inquir1W management regarding the
.ton for consistency with management's
iowledge we obtained during our audit of
ientary information and do not express an
We were engaged to report on the suppleme info , whh accompany the financial statements but are
not required supplementary informatio respe to this supplemental information, we made certain
inquiries of management and eval the c nt, and methods of preparing the information to
determine that the information comp wit principles generally accepted in the United States of
America, the method of preparin it ha changed om the prior period, and the information is appropriate
and complete in relation to o the in
statements. We compared and reconciled the supplemental
information to the underl accoun re s used to prepare the financial statements or to the financial
statements themselves.
This information is intended solely for the use of the Board of Directors and management and is not intended to
be, and should not be, used by anyone other than these specified parties.
Pleasant Hill, California
DATE
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 200 of 220
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Attachment 2
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 201 of 220
Attachment 3
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1, 000, 000
2015
Compensated Sick Leave Accrual Trend
2016
1
2017 2018 2019
Fiscal Year Ended June 30th
77 00/ 1
2020
Accrued Sick Leave Liability (left axis)
Total Compensated Absences Accrued Liability (left axis)
Sick Leave Share of Total (right axis)
27.6%
$1.4UM
2021
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
December 21, 2021 Regular FINANCE Committee Meeting Agenda Packet - Page 202 of 220